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The following is an excerpt from a S-1 SEC Filing, filed by SAGENT TECHNOLOGY INC on 1/29/1999.
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S WIND-UP CORP - S-1 - 19990129 - DILUTION

DILUTION

The pro forma net tangible book value of the Company as of December 31, 1998, after giving effect to the conversion of the Company's outstanding preferred stock, was $ or $ per share of Common Stock. Pro forma net tangible book value per share as of a specific date is determined by dividing the tangible book value of the Company (total tangible assets less total liabilities) by the number of outstanding shares of Common Stock at that date. After giving effect to the sale by the Company of the shares of Common Stock offered hereby (based upon an assumed initial public offering price of $ per share and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by the Company), the Company's net tangible book value at December 31, 1998 would have been $ or $ per share. This represents an immediate increase in net tangible book value to existing stockholders of $ per share and an immediate dilution to new public investors of $ per share. The following table illustrates the per share dilution:

Assumed initial public offering price per share......              $
  Pro forma net tangible book value per share as of
     December 31, 1998...............................  $
  Increase in net tangible book value per share
     attributable to new public investors............
                                                       --------    --------
Pro forma net tangible book value per share after
  offering...........................................
                                                                   --------
Dilution per share to new public investors...........              $
                                                                   ========

The following table sets forth on a pro forma basis as of December 31, 1998 the difference between the number of shares of Common Stock purchased from the Company, the total consideration paid, and the average price per share paid by existing stockholders and new public investors (based upon an assumed initial public offering price of $ per share before deduction of estimated underwriting discounts and commissions and offering expenses):

                           SHARES PURCHASED       TOTAL CONSIDERATION
                         ---------------------    -------------------    AVERAGE PRICE
                           NUMBER      PERCENT     AMOUNT     PERCENT      PER SHARE
                         ----------    -------    --------    -------    -------------
Existing                 18,669,377          %    $                 %      $
  stockholders.........
New public
  investors(a).........
                         ----------     -----     --------     -----
          Total........                 100.0%    $            100.0%
                         ==========     =====     ========     =====

If the Underwriters' over-allotment option is exercised in full, the number of shares held by new investors will increase to , or %, of the total shares of Common Stock outstanding after the offering.
(a) In the event that Sagent issues additional shares of Common Stock in the future, purchasers of Common Stock in this offering may experience further dilution. Options and warrants to purchase 2,313,735 and 235,623 shares of Common Stock, respectively, at a weighted average exercise price of $3.38 and $3.33 per share, respectively, were outstanding as of December 31, 1998. To the extent the holders of these options and warrants exercise their options and warrants, new investors will experience further dilution. See "Management--Employee Benefit Plans."

19

SELECTED CONSOLIDATED FINANCIAL DATA

The following selected consolidated financial data are qualified by reference to, and should be read in conjunction with, the Company's Consolidated Financial Statements and related notes thereto and Management's Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this Prospectus. The selected consolidated balance sheet data as of December 31, 1997 and 1998 and selected consolidated statement of operations data for the years ended December 31, 1996, 1997 and 1998 have been derived from the audited consolidated financial statements of the Company and the notes thereto included elsewhere in this Prospectus. The consolidated balance sheet data as of December 31, 1995 and 1996 and selected consolidated statements of operations data for the period from April 12, 1995 (inception) through December 31, 1995 have been derived from the audited consolidated financial statements of the Company not included herein.

                                           PERIOD FROM APRIL 12, 1995      YEARS ENDED DECEMBER 31,
                                              (INCEPTION) THROUGH       ------------------------------
                                               DECEMBER 31, 1995         1996       1997        1998
                                           --------------------------   -------    -------    --------
                                                      (IN THOUSANDS, EXCEPT PER SHARE DATA)
STATEMENT OF OPERATIONS DATA:
     Revenues, net:
          Licenses.......................                --             $   240    $ 5,728    $ 10,459
          Services.......................                --                  39      1,350       6,584
                                                    -------             -------    -------    --------
               Total revenues, net.......                --                 279      7,078      17,043
          Cost of revenues:
          Licenses.......................                --                 120        194         143
          Services.......................                --                 127        679       4,923
                                                    -------             -------    -------    --------
               Total cost of revenues....                --                 247        873       5,066
                                                    -------             -------    -------    --------
          Gross profit...................                --                  32      6,205      11,977
          Operating expenses:
          Sales and marketing............           $   198               2,727      5,929      12,037
          Research and development.......               469               3,425      4,969       6,013
          General and administrative.....               363               1,111      2,215       5,186
          Acquired in-process
            technology...................                --                  --         --       2,425
                                                    -------             -------    -------    --------
               Total operating
                 expenses................             1,030               7,263     13,113      25,661
                                                    -------             -------    -------    --------
          Loss from operations...........            (1,030)             (7,231)    (6,908)    (13,684)
          Other income (expense), net....                44                 192          8         (17)
                                                    -------             -------    -------    --------
          Net loss.......................           $  (986)            $(7,039)   $(6,900)   $(13,701)
                                                    =======             =======    =======    ========
          Pro forma net loss per share,
            basic and diluted............                                                     $  (0.74)
                                                                                              ========
          Shares used in calculation of
            pro forma net loss per share,
            basic and diluted(a).........                                                       18,495

                                                                  AS OF DECEMBER 31,
                                                         -------------------------------------
                                                          1995      1996      1997      1998
                                                         ------    ------    ------    -------
                                                                    (IN THOUSANDS)
BALANCE SHEET DATA:
     Cash and cash equivalents.........................  $5,026    $4,575    $3,813    $ 3,093
     Working capital...................................   4,901     3,715     2,201      1,122
     Total assets......................................   5,453     6,326     7,185     13,196
     Long-term obligations, net of current portion.....     114       544       627      3,346
     Total stockholders' equity........................   5,160     4,649     3,123      1,671


(a) See Note 2 of Notes to Consolidated Financial Statements for information concerning the calculation of shares used in computing pro forma net loss per share.

20

MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

All statements, trend analysis and other information contained in the following discussion relative to markets for the Company's products and trends in revenues, gross margins and anticipated expense levels, as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend" and other similar expressions constitute forward-looking statements. These forward-looking statements are subject to business and economic risks and uncertainties, and the Company's actual results of operations may differ materially from those contained in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in "Risk Factors" as well as other risks and uncertainties referenced in this prospectus.

OVERVIEW

Sagent develops, markets and supports Enterprise Intelligence software designed to address organizations' rapidly growing information access, analysis and delivery needs. The Sagent DMS product suite provides end-to-end, fully integrated data movement, access, analysis and presentation capabilities on all major database platforms and is specifically designed to deliver information over the Internet. Sagent also provides Sagent Professional Services, which include system and application design, implementation and education services, to facilitate the successful implementation of the Sagent DMS product suite.

Sagent was incorporated in April 1995, commenced operations in June 1995 and began selling the first products of the Sagent DMS product suite during the fourth quarter of 1996. The Company's revenues increased from $279,000 in 1996, to $7.1 million in 1997, the first full year of product shipments, and to $17.0 million in 1998. The Company had net losses of $7.0 million, $6.9 million and $13.7 million in 1996, 1997 and 1998, respectively, and had an accumulated deficit of approximately $28.6 million as of December 31, 1998. Although the Company's revenues have grown significantly during these periods, there can be no assurance that such growth will continue, nor that the Company can achieve or sustain profitability in the future. The Company intends to continue to invest significant resources in the development of the Sagent DMS product suite and on its sales and marketing and general and administrative functions.

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The Company's revenues are derived from two sources, product license revenues and service revenues. License revenues are derived from product sales to end users, resellers, distributors and enterprise application vendors as well as royalties from enterprise application vendors. License revenues are based upon the number and capacity of servers on which a product is installed, as well as on a per user basis. Service revenues are derived from providing consulting and training, maintenance and support services to end users.

The Company recognizes revenues in accordance with the American Institute of Certified Public Accountants Statement of Position No. 97-2. License revenues from sales to end users are recognized upon shipment of the product, if a signed contract exists, the fee is fixed and determinable and collection is deemed probable. If an acceptance period is provided, revenue is recognized upon the earlier of customer acceptance or the expiration of that period. The Company recognizes royalties as revenues based on an enterprise application vendor's sell-through of the Company's products. Fees for services are charged separately from licenses. Service revenues from consulting and training are recognized upon completion of the work to be performed. Revenues from maintenance and support agreements which includes product updates are deferred and recognized on a straight-line basis as service revenues over the term of the related agreement, which is typically one year.

The Company sells its products outside of the United States through distributors located in France, Germany, Japan, South Africa and the United Kingdom. In December 1997, the Company established a subsidiary, Sagent Technology Japan KK, to address the Asia Pacific market. Revenues from licenses and services to customers outside the United States were insignificant prior to 1998 and represented approximately $1.4 million in 1998. Historically, as a result of the relatively small amount of international sales, fluctuations in foreign currency exchange rates have not had a material effect on the Company's business, financial condition and operating results. The Company has agreements with its United Kingdom distributor and the parent company of its French and German distributors, under each of which the Company has an option to acquire such distributors. In the event of a change of control of the Company, the Company could be required to acquire the German distributor. Any such acquisition may have the effect of diluting existing stockholders, reducing the Company's available cash for working capital and other purposes, requiring substantial management attention, increasing annual amortization expense or imposing costs on the Company associated with integrating the acquired entity.

On February 28, 1998, the Company acquired Talus, Inc. ("Talus"), a privately held consulting company that has significant experience in the design and implementation of Enterprise Intelligence applications. At the time of the acquisition, Talus had a staff of 33 consultants. The total purchase price was $3.5 million, and the acquisition was recorded under the purchase method of accounting. In connection with the acquisition, the Company expensed $2.4 million of in-process technology in the quarter ended March 31, 1998. The determination of the acquired in-process technology allocation was based upon recently issued guidance by the Securities and Exchange Commission "(SEC)" and considered such factors as degree of completion, technological uncertainties, costs incurred and projected costs to complete. In addition, the Company recorded other intangible assets of $587,000 which are being amortized on a straight-line basis over the six months to three years following the acquisition. See Note 7 of Notes to Consolidated Financial Statements.

22

RESULTS OF OPERATIONS

The following table sets forth certain statement of operations data as a percentage of total revenues for the periods indicated:

                                                       YEARS ENDED DECEMBER 31,
                                                      --------------------------
                                                        1996      1997     1998
                                                      --------    -----    -----
Revenues, net:
  Licenses..........................................      86.0%    80.9%    61.4%
  Services..........................................      14.0     19.1     38.6
                                                      --------    -----    -----
     Total revenues, net............................     100.0    100.0    100.0
                                                      --------    -----    -----
Cost of revenues:
  Licenses..........................................      43.0      2.7      0.8
  Services..........................................      45.5      9.6     28.9
                                                      --------    -----    -----
     Total cost of revenues.........................      88.5     12.3     29.7
                                                      --------    -----    -----
Gross profit........................................      11.5     87.7     70.3
Operating expenses:
  Sales and marketing...............................     977.4     83.8     70.6
  Research and development..........................   1,227.6     70.2     35.3
  General and administrative........................     398.2     31.3     30.4
  Acquired in-process technology....................        --       --     14.2
                                                      --------    -----    -----
     Total operating expenses.......................   2,603.2    185.3    150.6
                                                      --------    -----    -----
Loss from operations................................  (2,591.8)   (97.6)   (80.3)
Other income (expense), net.........................      68.8      0.1     (0.1)
                                                      --------    -----    -----
Net loss............................................  (2,522.9)%  (97.5)%  (80.4)%
                                                      ========    =====    =====

FISCAL YEARS ENDED DECEMBER 31, 1996, 1997 AND 1998

REVENUES

Total revenues. The Company's revenues were $279,000, $7.1 million and $17.0 million in 1996, 1997 and 1998, respectively, representing increases of $6.8 million from 1996 to 1997 and $10.0 million, or 141%, from 1997 to 1998. The increase from 1997 to 1998 was primarily due to a greater volume of products sold and a significant increase in services revenues as a result of the acquisition of Talus. Two of the Company's customers each represented 10.0% of the Company's revenues in 1997. The Company had no customer that accounted for more than 10.0% of its revenues in 1996 or 1998.

License revenues. The Company's license revenues were $240,000, $5.7 million and $10.5 million in 1996, 1997 and 1998 respectively, representing increases of $5.5 million from 1996 to 1997 and $4.7 million, or 83.0%, from 1997 to 1998. The increase from 1996 to 1997 was due to the recognition of a full year of revenues from license sales in 1997, compared to the recognition of revenues from license sales during the fourth quarter in 1996. The increase from 1997 to 1998 was primarily due to an increase in license sales of the Sagent DMS product suite resulting from additions to the Company's direct sales and marketing staff. The Company anticipates that license revenues, which have represented a significant portion of the Company's total revenues in 1998, will continue to represent the substantial majority of its revenues for the foreseeable future.

Service revenues. Service revenues were $39,000, $1.4 million and $6.6 million in 1996, 1997 and 1998, respectively, representing increases of $1.3 million from 1996 to 1997

23

and $5.2 million, or 388%, from 1997 to 1998. The increase from 1996 to 1997 was primarily due to the addition of training and consulting services. Such services generated $778,000 in revenue during 1997. In 1996, no training and consulting work was performed, and service revenues represented only maintenance and support fees. The increase in service revenues from 1997 to 1998 was primarily due to additional growth in training and consulting services as a result of the Talus acquisition. Such services generated $4.2 million, or a 522% increase, in service revenues in 1998.

COST OF REVENUES

Cost of licenses. Cost of revenues from license sales consists primarily of royalties, product packaging, shipping, media and documentation. Cost of revenues from license sales was $120,000, $194,000 and $143,000 in 1996, 1997 and 1998, respectively, representing 50.0%, 3.0% and 1.0% of license revenue in the respective periods. The dollar increase from 1996 to 1997 was primarily due to increased costs for documentation and royalties related to the increased volume of licenses sold. The dollar decrease from 1997 to 1998 was due to reductions achieved in per unit packaging costs. The percentage decreases resulted from spreading these relatively fixed costs over an increased volume of product licenses sold.

Cost of services. Cost of services consists primarily of personnel costs and third-party consulting fees associated with providing software maintenance and support and training and consulting services. Cost of services revenues was $127,000, $678,000 and $4.9 million, in 1996, 1997 and 1998, respectively, representing 322%, 50.0% and 75.0% of services revenue in the respective periods. The dollar increases were primarily due to the increase in the number of technical support staff, the increase in the number of consultants in 1997 required to support introduction of training and consulting services and the increase in the number of consultants in 1998 providing consulting services as a result of the Talus acquisition. The percentage decrease from 1996 to 1997 was primarily due to the introduction of higher margin consulting services. The percentage increase from 1997 to 1998 was due to the increased infrastructure costs associated with supporting the Talus consultant staff.

OPERATING EXPENSES

Sales and marketing. Sales and marketing expenses consist primarily of salaries, benefits, commissions, bonuses and travel expenses for sales and marketing personnel as well as marketing programs and other promotion costs. Sales and marketing expenses were $2.7 million, $5.9 million and $12.0 million in 1996, 1997 and 1998, respectively, representing 976%, 84.0% and 71.0% of total revenue in the respective periods. The dollar increases resulted primarily from a $1.7 million increase in 1997 and a $3.0 million increase in 1998 in employee-related expenses, principally due to the hiring of additional sales personnel and to higher commissions paid as a result of Sagent's revenue growth. In addition, during 1998 expenses related to marketing programs increased $1.7 million as a result of the Company conducting its first user conference, expanding its advertising campaigns and beginning its Enterprise Intelligence seminar series. The percentage decreases were attributable to the Company's increased revenues. The Company believes that as it continues to expand its direct sales and presales support organization, its third-party partnering relationships and its indirect channel sales organization on a worldwide basis, sales and marketing expenses will continue to increase in absolute dollars, although such expenses may vary as a percentage of total revenues.

24

Research and development. Research and development expenses consist primarily of personnel and related costs associated with the development of new products, the enhancement and localization of existing products, quality assurance and testing. Research and development expenses were $3.4 million, $5.0 million and $6.0 million in 1996, 1997 and 1998, respectively, representing 1,226%, 70.0% and 34.0% of total revenues in the respective periods. The dollar increases were primarily due to a $1.2 million increase in compensation costs in 1997 resulting from the hiring of additional developers and an $800,000 increase in contractor costs in 1998 for the localization of the Company's software for use in Japan. The percentage decreases were attributable to the Company's increased revenues. The Company anticipates that research and development expenditures will continue to increase in absolute dollars, although such expenses may vary as a percentage of total revenues.

General and administrative. General and administrative expenses consist primarily of personnel costs for the Company's finance, human resources, information systems and other management departments. General and administrative expenses were $1.1 million, $2.2 million and $5.2 million for 1996, 1997 and 1998, respectively, representing 398%, 31.0% and 30.0% of total revenues in the respective periods. The dollar increases were primarily due to employee-related expenses associated with the addition of staff in senior managerial positions and professional fees necessary to manage and support the Company's growth. The percentage decreases were attributable to the Company's increased revenues. In addition, during 1998, the Company recorded significant legal fees associated with two litigation matters. One such matter remains pending. See "Risk Factors--Risks Associated with Intellectual Property" and "Business--Legal Proceedings."

Income Tax. As of December 31, 1998, the Company had available net operating loss carryforwards for federal and state income tax purposes of approximately $20.8 and $17.8 million, respectively, which expire from 2003 to 2018. See Note 14 of Notes to the Financial Statements included elsewhere herein. The Tax Reform Act of 1986 imposes limitations on the use of net operating loss carryforwards if certain stock ownership changes have occurred or could occur in the future.

25

QUARTERLY RESULTS OF OPERATIONS

The following tables set forth certain unaudited consolidated statements of operations data for the eight quarters ended December 31, 1998, as well as the percentage of Sagent's revenues represented by each item. These data have been derived from unaudited interim consolidated financial statements prepared on the same basis as the audited Consolidated Financial Statements contained herein and, in the opinion of management, include all adjustments, consisting only of normal recurring adjustments, considered necessary for a full presentation of such information when read in conjunction with the Consolidated Financial Statements and Notes thereto appearing elsewhere in this prospectus.

                                                                           QUARTERS ENDED
                                      -----------------------------------------------------------------------------------------
                                      MARCH 31,   JUNE 30,   SEPT. 30,   DEC. 31,   MARCH 31,   JUNE 30,   SEPT. 30,   DEC. 31,
                                        1997        1997       1997        1997       1998        1998       1998        1998
                                      ---------   --------   ---------   --------   ---------   --------   ---------   --------
                                                                           (IN THOUSANDS)
Revenues, net:
  Licenses..........................   $   777    $ 1,326     $ 1,784    $ 1,842     $ 1,798    $ 2,112     $ 2,932    $ 3,618
  Services..........................       224        159         384        583       1,199      1,568       1,689      2,128
                                       -------    -------     -------    -------     -------    -------     -------    -------
    Total revenues, net.............     1,001      1,485       2,168      2,425       2,997      3,679       4,621      5,746
Cost of revenues:
  Licenses..........................        30         22          26        116          36         24          61         21
  Services..........................       133         89         105        352         729      1,386       1,467      1,340
                                       -------    -------     -------    -------     -------    -------     -------    -------
    Total cost of revenues..........       163        111         130        468         765      1,411       1,529      1,362
                                       -------    -------     -------    -------     -------    -------     -------    -------
Gross profit........................       837      1,374       2,037      1,957       2,231      2,269       3,092      4,384
Operating expenses:
  Sales and marketing...............     1,343      1,184       1,494      1,908       2,203      3,007       3,188      3,639
  Research and development..........     1,192      1,122       1,217      1,439       1,516      1,401       1,649      1,447
  General and administrative........       403        540         427        845       1,199      1,321       1,425      1,271
  Acquired in-process technology....        --         --          --         --       2,425         --          --         --
                                       -------    -------     -------    -------     -------    -------     -------    -------
    Total operating expenses........     2,939      2,846       3,137      4,191       7,343      5,729       6,261      6,327
                                       -------    -------     -------    -------     -------    -------     -------    -------
Loss from operations................    (2,101)    (1,472)     (1,100)    (2,235)     (5,111)    (3,461)     (3,169)    (1,943)
Other income(expense), net..........         4        (24)         10         21          22         32         (26)       (45)
                                       -------    -------     -------    -------     -------    -------     -------    -------
Net loss............................   $(2,097)   $(1,496)    $(1,090)   $(2,214)    $(5,089)   $(3,429)    $(3,195)   $(1,988)
                                       =======    =======     =======    =======     =======    =======     =======    =======

                                                                  AS A PERCENTAGE OF TOTAL REVENUES
                                      -----------------------------------------------------------------------------------------
Revenues, net:
  Licenses..........................      77.6%      89.3%       82.3%      76.0%       60.0%      57.4%       63.4%      63.0%
  Services..........................      22.4       10.7        17.7       24.0        40.0       42.6        36.6       37.0
                                       -------    -------     -------    -------     -------    -------     -------    -------
    Total revenues, net.............     100.0      100.0       100.0      100.0       100.0      100.0       100.0      100.0
                                       -------    -------     -------    -------     -------    -------     -------    -------
Cost of revenues:
  Licenses..........................       3.0        1.5         1.2        4.8         1.2        0.7         1.3        0.4
  Services..........................      13.3        6.0         4.8       14.5        24.3       37.7        31.8       23.3
                                       -------    -------     -------    -------     -------    -------     -------    -------
    Total cost of revenues..........      16.3        7.5         6.0       19.3        25.5       38.3        33.1       23.7
                                       -------    -------     -------    -------     -------    -------     -------    -------
Gross profit........................      83.7       92.5        94.0       80.7        74.5       61.7        66.9       76.3
Operating expenses:
  Sales and marketing...............     134.2       79.7        68.9       78.7        73.5       81.7        69.0       63.3
  Research and development..........     119.2       75.5        56.1       59.3        50.6       38.1        35.7       25.2
  General and administrative........      40.3       36.4        19.7       34.8        40.0       35.9        30.8       21.6
  Acquired in-process technology....        --         --          --         --        80.9         --          --         --
                                       -------    -------     -------    -------     -------    -------     -------    -------
    Total operating expenses........     293.7      191.7       144.7      172.9       245.0      155.7       135.5      110.1
                                       -------    -------     -------    -------     -------    -------     -------    -------
Loss from operations................    (210.0)     (99.1)      (50.7)     (92.2)     (170.6)     (94.1)      (68.6)     (33.8)
Other income(expense), net..........       0.4       (1.6)        0.4        0.9         0.7        0.9        (0.6)      (0.8)
                                       -------    -------     -------    -------     -------    -------     -------    -------
Net loss............................    (209.6)%   (100.8)%     (50.3)%    (91.3)%    (169.8)%    (93.2)%     (69.1)%    (34.6)%
                                       =======    =======     =======    =======     =======    =======     =======    =======

26

The Company's operating expenses for the three months ended March 31, 1998 exceeded levels that the Company has historically experienced due primarily to acquired in-process technology expense recorded in connection with the acquisition of Talus. In addition, operating expenses for the three months ended June 30, 1998 exceeded levels that the Company has historically experienced due to the addition of several sales personnel and increased advertising expenses. Sagent's quarterly operating results may vary significantly from quarter to quarter. The timing of the Company's revenues are unpredictable due to several factors, including the effect of delays in customer orders, the lack of software order backlog, the potential effect of seasonality as international operations expand and the degree to which customers engage the Company's professional services. Additionally the Company cannot predict expenses with significant certainty given planned expansion of its business. Due to uncertainty surrounding revenues and expenses, the Company believes that quarter to quarter comparison of its operating results are not a good indication of future performance.

LIQUIDITY AND CAPITAL RESOURCES

At December 31, 1998, the Company had cash and cash equivalents totaling $3.1 million, a decrease of $720,000 from December 31, 1997. Since inception, the Company has funded its operations primarily through private sales of equity securities, the use of equipment leases and a bank line of credit. As of December 31, 1998, the Company had raised approximately $28.6 million, net of offering costs, from the issuance of preferred stock and the exercise of stock options, had financed equipment purchases totaling approximately $3.3 million, and had borrowed $1.7 million under its line of credit with a bank. Approximately $300,000 of available borrowings remain under the line of credit.

Net cash used in operating activities was $6.3 million, $5.4 million and $11.0 million in 1996, 1997 and 1998, respectively. For such periods, net cash used in operating activities was primarily a result of funding ongoing operations.

The Company's investing activities have primarily consisted of annual purchases of property and equipment. Capital expenditures, including those under capital leases, totaled $1.1 million, $1.1 million and $1.2 million in 1996, 1997 and 1998, respectively. Capital leases have been used to finance the acquisition of property and equipment, primarily computer hardware and software, and leasehold improvements and furniture associated with the Company's recent move into a larger facility to accommodate its increasing employee base. In 1998, investing activities included $2.7 million associated with the acquisition of Talus. The Company anticipates that it will experience an increase in its capital expenditures and lease commitments consistent with its anticipated growth in operations, infrastructure and personnel.

The Company's financing activities have primarily included sales of preferred stock and use of its equipment lease lines. Proceeds from the issuance of preferred stock totaled $6.5 million, $5.2 million and $10.4 million in 1996, 1997 and 1998 respectively. The proceeds from equipment financing, net of principal payments, totaled $600,000, $294,000 and $3.4 million in 1996, 1997 and 1998 respectively.

The Company has a line of credit with a bank for $2.0 million, which bears interest at the lending bank's prime rate. Borrowings are limited to the lesser of 80.0% of eligible accounts receivable or $2.0 million and are secured by substantially all of the Company's non-leased assets. The line of credit contains certain financial restrictions and covenants. At December 31, 1998, total borrowings available under this line were approximately $300,000. This credit facility expires in December 2001, and the Company expects to

27

extend or replace such credit facility, although there can be no assurance that it will be able to do so on terms acceptable to the Company or at all. The Company was not in compliance with certain financial covenants under its line of credit as of December 31, 1998, and received a waiver from its lender for non-compliance prior to December 31, 1998. The Company is currently in compliance with its financial covenants under such line of credit.

Sagent believes that the net proceeds from the offering, together with existing sources of liquidity, will be sufficient to meet its working capital and anticipated capital expenditure requirements for at least the next 12 months. Thereafter, Sagent may require additional funds to support its working capital requirements or for other purposes, and may seek, even before such time, to raise additional funds through public or private equity financing or from other sources. There can be no assurance that additional financing will be available at all, or that if available, such financing will be obtainable on terms acceptable to Sagent or that are not dilutive to its stockholders.

RECENT ACCOUNTING PRONOUNCEMENTS

The American Institute of Certified Public Accountants issued Statement of Position ("SOP") No. 98-1, "Software for Internal Use," which provides guidance on accounting for the cost of computer software developed or obtained for internal use. SOP No. 98-1 is effective for financial statements for fiscal years beginning after December 15, 1998. The Company does not expect that the adoption of SOP No. 98-1 will have a material effect on its business, financial condition and operating results.

YEAR 2000 ISSUES

Many currently installed computer systems and software products store dates using only the last two digits of the calendar year. As a result, such systems may not be able to distinguish whether "00" means 1900 or 2000, which may cause system failures or erroneous results. The Company has designed its products to be capable of handling four digit dates, and therefore the Company believes that the direct impact of the Year 2000 problem on the Company's products will not be significant. In addition the Company will continue Year 2000 testing of its products throughout the calendar year 1999. The Company does not expect expenditures with respect to ensuring Year 2000 compliance of its internal systems and software to exceed $50,000. The Company's products operate in complex network environments and directly or indirectly interact with a number of other hardware and software systems. Despite preliminary testing the Company cannot predict all the possible Year 2000 issues arising from the interaction with older hardware and software systems. If the source of any of these hardware or software systems do not appropriately interpret the upcoming calendar year 2000, some level of modification or possible replacements of such systems will be necessary. Known or unknown errors associated with interaction between the Company's products and other hardware or software systems could result in a delay or loss of revenue, interruption of service, cancellation of customer contracts, diversion of development resources, damage to the Company's reputation, increased service and warranty costs and litigation, any of which could have a material adverse effect on the business, financial condition and results of operations of the Company.

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The Company is currently unable to predict the extent to which the Year 2000 problem will affect its customers, strategic partners or suppliers, or the extent to which it would be vulnerable to any failure by customers, strategic partners or suppliers to remediate any Year 2000 issue on a timely basis. The failure of major customers, partners or suppliers to convert its systems on a timely basis or to implement a conversion that is compatible with the Company's systems could have a material adverse effect on the Company's business, financial condition and operating results.

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BUSINESS

The following description of the Company's business should be read in conjunction with the information included elsewhere in this Prospectus. This description contains certain forward-looking statements that are based largely on the Company's current expectations and are subject to a number of risks and uncertainties. Actual results and events could differ significantly from those discussed in the forward-looking statements as a result of certain of the factors set forth below and elsewhere in this prospectus.

OVERVIEW

Sagent develops, markets and supports Enterprise Intelligence software solutions designed to address organizations' rapidly growing information access, analysis and delivery needs. The Sagent DMS product suite provides end-to-end, fully integrated data movement, access, analysis and presentation capabilities on all major database platforms, and is specifically designed to deliver information over the Internet. The Sagent DMS product suite utilizes a multi-dimensional data structure known as a Star Schema and advanced dataflow technology to construct and provide access to data marts capable of handling some of the most complex and demanding Enterprise Intelligence requirements. Sagent's Web technology enables the distribution of information throughout the organization and gives end users the ability to access and analyze data through common Web browsers. Sagent also offers Sagent Professional Services, which include system and application design, implementation and education services, to facilitate the successful implementation of the Sagent DMS product suite. Sagent's products and services have been adopted in a variety of industries, including financial services, telecommunications, technology, health care, retail and others. The Company currently has more than 200 customers worldwide. Sagent markets its software and services through its direct sales force and indirect channels, which include enterprise application vendors, resellers and international distributors.

INDUSTRY BACKGROUND

Today, information about an organization's customers, products and operations is one of its most important strategic assets. An organization's ability to maximize revenues and efficiently manage operations increasingly depends upon its ability to rapidly collect, organize, analyze and distribute information. In particular, as organizations have begun to pursue more complex operational strategies, their need for timely information has increased. For example, businesses engaged in total customer management must synthesize information regarding past purchases, service history, payment status and sales contacts. Similarly, businesses engaged in supply chain management must manage the information exchanged among multiple plants, sales locations, suppliers and distribution facilities. Furthermore, as businesses continue to streamline their organizational structures to improve time to market and responsiveness to rapidly changing market conditions, decision making authority is expected to become more distributed, thus heightening the need for broader dissemination of information throughout the enterprise. Most recently, the rapid adoption of the Internet and the World Wide Web has given organizations the ability to share information internally and externally on a cost-effective basis and has dramatically increased the number of people who can receive and access information.

To meet these challenges, many organizations have purchased and implemented data warehousing systems and decision support software. These systems were designed to assist organizations in answering fundamental business questions such as "Who are our best

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customers?" or "What are our most profitable products?" Early data warehousing systems aggregated an organization's enterprise data into a single location and reorganized it into contextual, business-related terms. The single location has enabled the use of query tools or other decision support software to explore and analyze the data. The need for data warehousing and decision support software has also been driven by the proliferation of online transaction processing ("OLTP") systems. These systems include packaged applications or custom and semi-custom systems, which automate business processes such as manufacturing planning, customer support, billing, accounting, human resources and financial services transactions. While these multiple OLTP systems have provided greater business efficiency, they have also created massive amounts of new data, typically maintained in the form of proprietary, complex and incompatible data models.

The demand for more useful information and the proliferation of new data sources and data types has led to an active market for data warehousing and decision support software. International Data Corporation ("IDC") estimates that the size of the data warehouse market will grow from over $2.8 billion in 1997 to over $8.0 billion in 2001. Forrester Research projects that the decision support segment of the data warehouse market will grow from $1.1 billion in 1997 to $3.6 billion by 2001.

As corporate data warehouses have grown in size and complexity, the Company believes that several challenges have prevented organizations from realizing the promise of data warehousing systems and decision support solutions. The first challenge has been integration. Traditional solutions have utilized discrete data warehousing and decision support software purchased from many different vendors, including separate data extraction tools, data cleansing tools, data sorting packages, relational database management systems, report writers, analysis tools and distribution packages. Integrating these point products is difficult and often limits the capability of the overall solution. The second challenge has been user scalability. Traditional solutions were designed to handle a small number of users and were not designed to meet the needs of a large number of simultaneous users with diverse, individual requirements. The third challenge has been performance. Discrete data warehousing and decision support software applications often have difficulty aggregating complex enterprise data into a single business view of information, which is critical for processing information requests efficiently. The fourth challenge has been cost and complexity. Many large data warehousing projects cost several million dollars and take a year or more to implement.

Most importantly, the emergence of the Internet has challenged the continued viability of traditional data warehousing and decision support software as the best approach to enterprise-wide information access, analysis and delivery. The Internet provides organizations with a low-cost infrastructure to connect their customers, suppliers, partners and employees directly with the information they need. Organizations are using the Internet to streamline their marketing, sales and support processes and offer enhanced customer service capabilities. Examples of these initiatives include enabling customers to use the Internet to research product features, order products, check order status and obtain on-line service and support. Organizations are also using the Internet to track key business information regarding sales, customers, suppliers, distributors, assets and resources, and to make that information widely available to employees when and where they need it. As the number of Internet users continues to grow, the Company believes that the demand for Web-based information access, analysis and delivery will increase significantly. IDC forecasts that total commerce on the Internet will grow from an estimated $12.4 billion in 1997 to $239.5 billion in 2001, with the business-to-business component growing from an estimated $7.3 billion to $179.4 billon in the same period.

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NEED FOR A NEW SOLUTION

The Company believes that new demands for high performance information access, analysis and delivery, particularly through the Internet, have stretched the capabilities of traditional data warehousing and decision support systems. Many organizations now require a new generation of Enterprise Intelligence solutions that can leverage Internet technologies and accommodate the rapidly growing number of internal and external users who need to access business-critical information. To be most effective, the Company believes that these solutions should satisfy four critical requirements:

- First, solutions must be capable of accessing and assembling increasing amounts of data from multiple, disparate and complex sources into a single business view of information for the end user.

- Second, solutions must be capable of scaling to hundreds and thousands of concurrent users and delivering information through the bandwidth of many Internet connections, as well as through new access devices such as hand-held computers and alphanumeric pagers.

- Third, solutions must deliver information fast enough to meet the demands of the new business environment, particularly the performance requirements of e-Business and Internet applications.

- Fourth, solutions should be delivered by a single vendor that can provide a complete, integrated product and the professional services required to implement a working, timely solution.

THE SAGENT SOLUTION

Sagent offers a new generation of Enterprise Intelligence software solutions designed to address organizations' rapidly growing information access, analysis and delivery needs. The Sagent DMS product suite provides end-to-end, fully integrated data movement, access, analysis and presentation capabilities on all major database platforms and is specifically designed to deliver information over the Internet. The Sagent DMS product suite utilizes a multi-dimensional data structure known as a Star Schema and advanced dataflow technology to construct and provide access to data marts capable of handling some of the most complex and demanding Enterprise Intelligence requirements. Sagent's data marts, which are data warehouses that contain a subset of specific corporate data, provide a more detailed, single business view of information that is focused on the needs of a specific group of users. Sagent's Web technology enables the distribution of information throughout the organization and gives end users the ability to access and analyze data through common Web browsers. Sagent also offers Sagent Professional Services, which include system and application design, implementation and education services, to facilitate the successful implementation of the Sagent DMS product suite.

Sagent believes its solution provides the following key benefits:

High Performance Internet Access. The Sagent DMS product suite is designed to provide customers with the ability to access, analyze and deliver critical information easily and rapidly over the Web. The Sagent architecture utilizes Internet based processing capabilities to minimize the bandwidth required for the delivery of information over the Web and other new access technologies. This technology significantly reduces the waiting time for Web-page processing and information delivery, thus increasing user productivity.

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Single Business View of Information. The Sagent DMS product suite utilizes a 32-bit application server, a proprietary dataflow model and Star Schema data structure to create a single business view of information from complex, disparate data sources. The Company believes this consolidated view of information allows Sagent users to access and analyze complex data more easily and rapidly than with traditional solutions. This approach also allows Sagent's customers to manage the rapidly growing levels of data within their organizations.

Highly Scalable. Sagent's use of advanced bandwidth management technology, combined with its core Star Schema data structure, enables the Sagent DMS product suite to provide Web-based information access and data analysis capabilities to thousands of users without degrading application performance and availability.

Low Total Cost of Ownership. The Sagent DMS product suite is designed to deliver low total cost of ownership by leveraging industry standards such as the Windows NT operating system and other Microsoft technology, by providing an integrated product suite to lower implementation time and cost, and by providing extensive administrative functionality to reduce ongoing systems management burdens.

STRATEGY

Sagent's objective is to become a leading provider of Enterprise Intelligence software solutions to address organizations' rapidly growing information access, analysis and delivery needs.

The following are key elements of the Company's strategy:

Focus on Internet Market Opportunity. The Company believes that the growing global use of the Internet is driving widespread implementation of new e-Business applications. These applications depend on the efficient access, analysis and presentation of enterprise data. By providing a product that delivers large amounts of highly complex data through the Web to large numbers of simultaneous users, the Company believes that its products can be a foundation and enabler of Web-based Enterprise Intelligence and e-Business applications.

Extend Product Functionality and Technology Leadership. The Company believes it provides the first fully integrated, end-to-end Enterprise Intelligence software solution capable of meeting the performance demanded by the emerging e-Business environment. The Company is currently developing the next version of the Sagent DMS product suite, which is being designed to significantly enhance user scalability, and which is currently scheduled for release in the first half of 1999. The Company plans to add capabilities that broaden and complement the Sagent DMS product suite, such as data analysis (including data mining, forecasting and modeling), data visualization, data sorting, Web querying, extraction of data from SAP applications and information broadcasting. In addition, the Company may introduce new international versions of its products and may port its products to additional UNIX platforms as opportunities arise. Although the Company expects that certain of its new products will be developed internally, the Company may, based on timing and cost considerations, acquire technology or products from third parties.

Offer Pre-Built Enterprise Intelligence Applications. The Company believes there is a large market for pre-built applications that utilize the underlying analytical capabilities of the Sagent DMS product suite and offer "out of the box" functionality in targeted vertical markets. To date, the Company has designed, developed and marketed such applications in conjunction with strategic partners, including Siebel, Advent Software, Inc. ("Advent")

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and Automatic Data Processing, Inc. ("ADP"). In the future, Sagent plans to leverage the vertical and functional knowledge gained through these relationships and through implementations by its Professional Services Group to develop other pre-built Enterprise Intelligence applications.

Broaden Distribution and Strategic Relationships. The Company believes that it can continue to expand its market penetration and build its brand recognition by aggressively expanding its direct sales force; pursuing strategic relationships with selected enterprise application vendors, consulting firms, system integrators and development partners; and expanding its network of resellers and distributors. To date, the Company has entered into relationships with companies such as Microsoft Corporation ("Microsoft"), Oracle Corporation ("Oracle"), Siebel, ADP, Advent and USinternetworking, Inc. ("USinternetworking"). The Company also believes that a significant opportunity exists to sell its products internationally and intends to leverage its existing distributor relationships in Europe and Japan and expand its direct and indirect international sales efforts to exploit this opportunity.

Provide High Quality Services to Customers. The Company provides comprehensive implementation, support and training services to help customers adopt Sagent products and build customer satisfaction, strong references and long-term relationships. The Company plans to continue to expand its professional services capabilities and infrastructure. In addition, Sagent intends to expand the education and training services it offers to its strategic partners and resellers to help these companies market Sagent products more effectively.

Exploit Rapid Growth of Microsoft Windows NT. The Company will continue to focus its development efforts on the Microsoft Windows NT platform. Sagent believes Windows NT is rapidly gaining share in the enterprise computing market due to its ease of maintenance and cost effectiveness. IDC projects that the installed base of Windows NT-based servers will increase from 1.6 million in 1997 to 5.9 million in 2002. The Company believes that the Sagent DMS product suite has a competitive advantage in leveraging the growth of the Windows NT platform because it was designed to optimize Microsoft technology.

PRODUCTS

The Sagent DMS product suite is comprised of software application servers that handle the core components of an end-to-end solution, as well as end user analysis applications.

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[Graphic depiction of the components of the Company's product architecture]

As illustrated above, the Sagent DMS product suite consists of three core functional areas: Data Load and Management, Data Access and Analysis, and Administration and Design.

DATA LOAD AND MANAGEMENT

Sagent Data Load Server. The Sagent Data Load Server extracts data from multiple client/server and mainframe databases, transforms that data into a Star Schema data structure, and then loads that data into a Sagent data mart. The server relies upon a 32-bit multithreaded architecture to achieve its high level of performance.

DATA ACCESS AND ANALYSIS

Sagent Data Access Server. The Sagent Data Access Server delivers the data loaded into a Sagent data mart to end users. The server is designed to allow large numbers of users to access and analyze data stored in Star Schema structures. The server relies upon a 32-bit multithreaded architecture to achieve its high level of performance.

Sagent WebLink Server. The Sagent WebLink Server is a high performance, scalable application server that delivers information from the Sagent Data Access Server, allowing end users to query, analyze and report business information from a Web browser. The server also provides management capabilities that maintain the security and availability of Internet connections.

Sagent Statistical Calculator. The Sagent Statistical Calculator adds advanced statistical analysis capabilities to the Sagent Data Access Server. The calculator allows organizations to automate statistical analyses of large, complex data sets, thereby improving the single business view of information distributed to end users.

Sagent Information Studio. Sagent Information Studio enables users to access and analyze an organization's information in client/server environments. Information Studio, as well as WebLink Server, can be integrated with Microsoft Excel to aid in exporting result sets to spreadsheets for further analysis.

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The following reporting and analysis products can be integrated with the Sagent DMS product suite:

Sagent Reports. Sagent Reports allows end users to create, publish and view graphically rich presentations of corporate information.

Sagent Analysis. Sagent Analysis provides a wide range of analytical capabilities for business data, such as rankings, deciles, periodic and exception reporting. The product's drill down analysis capabilities allow users to view information in either cross-tabular or chart format.

StatView for Sagent. StatView for Sagent provides an end user with the ability to create, publish and view complex statistical analyses of corporate data in client/server environments.

ADMINISTRATION AND DESIGN

Sagent Design Studio. Sagent Design Studio provides a visual environment for describing data and designing the flow of data for both loading and accessing a data mart. Sagent Design Studio minimizes the requirement that users have in-depth knowledge of databases, networks and operating systems and allows them to concentrate on the business purpose of accessing, analyzing and delivering information.

Sagent Admin. Sagent Admin enables administrators to manage and control one or more Sagent DMS servers from a single location. In addition, Sagent Admin manages user security and access privileges.

Sagent Automation. Sagent Automation automates common tasks within the Sagent DMS product suite, such as data loading, error recovery and quality assurance. Tasks can be initiated by events such as a pre-determined time of day or date, reaching disk storage capacity or the availability of new data.

PROFESSIONAL SERVICES AND CUSTOMER SUPPORT

The Sagent Professional Services Group offers an extensive set of consulting and education services to the Company's customers. The Sagent Professional Services Group has significant experience in the design and implementation of Enterprise Intelligence applications using a Star Schema data architecture. Sagent's customers are able to select an appropriate level of support for their implementations, including project planning, design and implementation assistance.

In addition to consulting services, the Sagent Professional Services Group offers design and product training classes to facilitate customer success in initial implementations and provide a foundation for expanding the use of Sagent products in customer organizations. The Sagent Professional Services Group also offers to third party consultants product certification training, which the Company believes helps develop market awareness of its product offerings.

CUSTOMERS

The following is a representative list of the Company's customers that have purchased more than $75,000 in product licenses or services from the Company since January 1, 1997.

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ARINC                           DiaLogos                    Mashantucket Pequot Tribal
Automated Data Processing       Eddie Bauer                 Nation
AT&T                            Ernst & Young               MCI WorldCom
Barnesandnoble.com              Express Scripts/ValueRx     Miller Freeman
Bell Communications Research    Farm Credit Services        NationsBanc
BellSouth Cellular              General American            NETCOM On-Line
BellSouth Entertainment         Transportation              Communication Services
CEISS/BC Ministry of Education  Hoechst Marion Roussel      Nordstrom
CellStar                        GPU Energy                  Nycomed
Ceridian                        J.P. Morgan & Co.           PairGain Technologies
City of Santa Clara             Jiffy Lube International    Pharmaceutical Care Network
Cohn & Wells                    John Hopkins University     Prudential Insurance
Deutsche Financial Services     Kaufman & Broad Home        Rohm & Haas
                                Kawasaki Steel Systems R&D  The Application Group

In 1997, the Company received in excess of 10% of its total revenues from each of Oracle Corporation and Automated Data Processing.

CASE STUDIES

The following case studies illustrate how certain of the Company's customers have utilized the Sagent DMS product suite:

PHARMACEUTICAL CARE NETWORK

Pharmaceutical Care Network ("PCN") is a pharmacy benefits management and healthcare information services company.

Business Challenge. PCN was one of the first pharmacy benefit management companies to institute on-line, real-time claim processing for a nationwide network of participating pharmacies. When a plan participant presents a prescription at a PCN participating pharmacy, the applicable plan guidelines are referenced on-line instantly, ensuring that a customer pays for appropriate and eligible prescriptions at the contracted price. PCN wanted to leverage the information it was gathering through its nationwide network of pharmacies to improve the level of service across its pharmaceutical care value chain, including plan members, health care providers and plan sponsors and affiliated pharmacies. To provide this service, PCN wanted to install an Enterprise Intelligence solution that would allow customers to access and analyze the vast amounts patient care information through a Web browser.

Solution. PCN established MedIntelligence, a family of information-based products for its pharmaceutical care value chain, to screen and review prescription data, initiate notifications that identify drug therapy problems and recommend action to improve the quality and cost of patient care. PCN selected the Sagent DMS product suite as the core of MedIntelligence to integrate large amounts of disparate information within the PCN network and to rapidly deliver MedIntelligence products over the Web. The MedIntelligence products and the Sagent DMS product suite furnishes healthcare providers with access to a more complete view of patient drug regimens, which reduce the risk of harmful drug interactions, and provide health care payers and plan administrators with the ability to monitor pharmacy related plan costs and usage trends.

CELLSTAR CORPORATION

CellStar Corporation ("CellStar") is an integrated wholesaler and retailer of wireless handsets and other wireless communication products, with operations in the U.S., Asia/Pacific, Latin America and the U.K.

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Business Challenge. CellStar required a solution to provide its global sales force and key customers access to sales data for analysis and presentation. In particular Cellstar wanted to provide it's employees with the ability to monitor sell through, perform customer rankings and identify high margin products. In addition CellStar wished to provide it's key customers and vendors with worldwide data on the most popular products by volume to maximize their revenue opportunity.

Solution. CellStar uses the Sagent DMS to manage and access CellStar data. The Sagent Analysis desktop module with Sagent's WebLink lets users perform multidimensional analysis on the data mart to gain sales data information either from a client/server environment for their internal employees and through a Web browser for their global sales force, customers and vendors. While the WebLink facility is used to provide access to data mart information to general users, Sagent's Information Studio with the analysis module is generally utilized by internal business analysts. This Enterprise Intelligence solution provides CellStar's manufacturers and key customers with the ability to analyze sell- through data so that they can determine which products are selling at acceptable margins to make better informed channel marketing decisions.

TECHNOLOGY

The Company has invested significant resources in developing leading technologies and believes that utilizing a Star Schema data architecture and the Company's advanced dataflow technology to construct and provide access to data marts gives it a competitive advantage over traditional solutions. The Company also believes that its technology maximizes the advantages of an Internet based architecture to provide one of the most scalable solutions currently offered in the market. The following are the key underlying technologies of the Sagent DMS product suite:

Dataflow Technology. Sagent's dataflow technology is the foundation for the Sagent DMS load and access servers. Dataflow technology allows users to rapidly construct processes that load and access a data mart without writing code. These services relieve the need for users to have in-depth knowledge of databases, networks and multithreaded operating systems and allow them to concentrate on the application they are building. The dataflow engine executes the processes that are visually designed by the user. The dataflow technology is implemented using the COM (Component Object Model) standard developed by Microsoft. The utilization of a modular, language-independent component technology allows customers and resellers to incorporate new functionality into the product via a transform software development kit. This same development kit provides the Company with the ability to add new functionality to the server rapidly and send it to the customer electronically without requiring a complete upgrade of the system.

Star Schema Design. The Company has implemented a set of dataflow components to support the loading and accessing of Star Schemas. Star Schemas are a database design technique used to provide high performance for ad hoc data analysis within a relational database by minimizing the number of relations to process in a query. By combining query generation with the dataflow engine's processing capability, the Company provides power and speed to users accessing Star Schema structured data. In addition, the Sagent DMS product suite provides a set of specialized dataflow components for loading Star Schemas that significantly lowers the implementation time for the Sagent DMS product suite.

Internet-Based Architecture. The Company has developed an architecture that utilizes the network of computing tiers that comprise the Web. These tiers include browsers, Internet servers, data access servers, data load servers and database servers. The efficient

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usage of CPU cycles and memory provided by these tiers enables the Sagent DMS product suite to achieve a high degree of scalability and performance. In addition, on-demand data delivery minimizes bandwidth usage, improving the rate at which information is delivered to users.

SALES AND MARKETING

Sales. The Company sells its products and services in North America primarily through its direct sales and services organization. The Company has domestic sales offices in California, Colorado, Connecticut, Florida, Georgia, Massachusetts, New York, Pennsylvania, Texas, Illinois and Virginia. The direct sales process involves the generation of sales leads through direct mail, seminars, telemarketing, advertising and the Web. The Company's field sales force typically conducts demonstrations and presentations of the Company's products to developers and management at customer sites as part of its direct sales effort. The time between initial customer contact and an actual sales order may span six months or more. See "Risk Factors--Our Products Have Lengthy Sales Cycles."

Within the Company's direct sales group, a separate group targets strategic partnerships with industry-leading application software providers such as Siebel, Advent, ADP and Oracle. These vendors embed all or a portion of the Company's products within their own applications and then sell the integrated products to their customers. The enterprise application vendor's customer receives a license to use the Company's products solely in conjunction with the vendor's application with which Sagent DMS products are integrated. Enterprise application vendors provide the first level of post-sales support to customers. The Company also utilizes a limited number of resellers, such as Unisys Corporation, USinternetworking and Cap Gemini Group, that remarket the Company's products to their customer base. Resellers are offered discounts on the Company's products and sell a full use license of the product. The Company's resellers do not provide post-sales support. The Company's ability to achieve revenue growth in the future will depend in large part on its success in expanding its direct sales force and in further establishing and maintaining relationships with enterprise application vendors and resellers. See "Risk Factors--We Rely Substantially on Our Channel Partners."

The Company also sells its products internationally through distributors located in France, Germany, Japan, South Africa and the United Kingdom. These distributors perform some or all of the following functions: sales and marketing, systems integration, software development, and ongoing consulting training and customer support. In exchange for providing such services, the Company offers its distributors discounts on products. International sales are subject to certain risks, including, but not limited to, costs of localizing products for foreign countries, dependence on local vendors, currency fluctuations and greater difficulty or delay in accounts receivable collection. See "Risk Factors--Risks Associated with International Operations."

Marketing. The Company has a comprehensive marketing strategy which includes public relations, user group meetings, programs to work closely with analysts and other influential third parties, and direct mail campaigns. The Company also utilizes the Web for advertising campaigns on frequently visited Web sites including those of its strategic partners. The Company uses its Web site, www.sagenttech.com, to establish its market presence, generate leads and extend its program offerings to customers and strategic partners. A key element of the Company's marketing strategy is to leverage its relationship with Dr. Ralph Kimball, one of the Company's consultants and strategic partners, by sponsoring his data mart design courses. The Company has also invested in building a

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partner and channel marketing function to recruit, train, support and offer co-marketing opportunities to technology partners and resellers.

RESEARCH AND PRODUCT DEVELOPMENT

The Company's research and development group is organized by product teams, which consist of product managers, software engineers, quality assurance engineers and technical documentation specialists. The teams are encouraged to maintain consistent architectural standards, engineering practices, quality goals and documentation standards across a broad product line. The product teams use a phased development approach that monitors cost, schedule, quality, time, functionality and customer satisfaction. The Company has established an executive product steering committee which reviews the progress of individual product teams at each phase of development. In order to incorporate customer needs in product releases, the product teams actively solicit requirements from customers, user groups, professional services, industry analysts and technical support.

The Company's total expenses for research and development for the year ended December 31, 1996, 1997 and 1998 were $3.4 million, $5.0 million and $6.0 million respectively. The Company believes that research and development expenses will continue to increase in the future. To date, the Company's development efforts have not resulted in any capitalized software development costs.

The Company has made substantial investments in research and development. The Company is currently developing the next version of the Sagent DMS product suite, which is being designed to significantly enhance user scalability, and is currently scheduled for release in the first half of 1999. The Company plans to add capabilities that broaden and complement the Sagent DMS product suite, such as data analysis (including data mining, forecasting and modeling), data visualization, data sorting, Web querying, extraction of data from SAP applications and information broadcasting. In addition, the Company may introduce new international versions of its products and may port its products to additional UNIX platforms as opportunities arise. Although the Company expects that certain of its new products will be developed internally, the Company may, based on timing and cost considerations, acquire technology or products from third parties.

The Company believes that its future performance will depend in large part on its ability to maintain and enhance its current product line, develop new products that achieve market acceptance, maintain technological competitiveness and meet an expanding range of customer requirements. The Company's inability to enhance its existing products and develop new ones in a timely and effective manner, could have a material adverse effect upon the Company's business, financial condition and operating results. See "Risk Factors--We Depend upon New Product Development," "--Evolving Technology Standards May Impact Our Products" and "--Risk of Software Defects and Potential Product Liability."

COMPETITION

The markets for the Company's products are intensely competitive and subject to rapidly changing technology. The Company competes against providers of decision support software, data warehousing software, enterprise application software and e-Business software. The primary bases of competition in this market include performance, scalability, ease of use, operating platform and cost of ownership.

The Company's competitors providing traditional decision support software include Brio Technology, Inc., Business Objects S.A., Cognos Incorporated, Information Advan-

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tage, Inc. and MicroStrategy, Inc. The Company's competitors providing data warehousing software include Ardent Software, Inc., Informatica Corporation, Information Builders, Oracle, PLATINUM Technology, Inc. and SAS Institute, Inc. In addition, enterprise application software vendors such as Baan Company N.V., J.D. Edwards & Company, PeopleSoft, Incorporated and SAP AG are beginning to offer decision support and analytical modules, although each tends to support the analysis of data only from its own operational systems. One or more of these companies may expand its technologies to support greater Enterprise Intelligence functionality. The Company may also face competition from vendors of products and turn-key solutions for e-Business applications that could include Internet based information functionality.

Many of the Company's competitors have longer operating histories, significantly greater financial, technical, marketing or other resources, or greater name recognition than we do. The Company's competitors may be able to respond more quickly than the Company can to new or emerging technologies and changes in customer requirements. Competition could seriously harm the Company's ability to sell additional software and maintenance and support renewals on terms favorable to the Company. Competitive pressures could reduce the Company's market share or require it to reduce the price of products, either of which could materially and adversely affect the Company's business, financial condition and operating results.

INTELLECTUAL PROPERTY

The Company seeks to protect its software, documentation and other written materials primarily through a combination of patent, trade secret, trademark and copyright laws, confidentiality procedures and contractual provisions. For example, the Company licenses rather than sells its software and requires licensees to enter into license agreements that impose certain restrictions on the licensees' ability to utilize the software. In addition, the Company seeks to avoid disclosure of its trade secrets, by, among other things, requiring those persons with access to the Company's proprietary information to execute confidentiality agreements with the Company and restricting access to the Company's source code.

The Company has two patent applications pending and one patent application allowed in the United States with respect to certain aspects of its software. None of these patents have been issued, and there can be no assurance that any patents will be issued pursuant to these applications or that, if granted, such patent would survive a legal challenge to its validity or provide significant protection to the Company. Despite the Company's efforts to protect its proprietary rights, unauthorized parties may attempt to copy aspects of the Company's products or obtain and use information that the Company regards as proprietary. Policing unauthorized use of the Company's products is difficult. While the Company is unable to determine the extent to which piracy of its software products exists, software piracy can be expected to be a persistent problem, particularly in foreign countries where the laws may not protect the Company's proprietary rights as fully as in the United States. There can be no assurance that the Company's means of protecting its proprietary rights will be adequate or that the Company's competitors will not independently develop similar technology.

From time to time, the Company may be involved in intellectual property disputes. In May 1998, Acta Technology, Inc. ("Acta") filed suit against the Company alleging, among other things, copyright infringement, and the Company filed suit against Acta alleging misappropriation of Company trade secrets. Other than Acta, the Company has not been notified that the Company's products infringe the proprietary rights of third

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parties. However, there can be no assurance that third parties will not claim infringement by the Company with respect to current or future products. The Company expects that software product developers will increasingly be subject to infringement claims as the number of products and competitors in the Company's industry segment grows and the functionality of products in different industry segments overlaps. See "--Legal Proceedings" and "Risk Factors--Risks Associated with Intellectual Property."

The Company relies upon certain software to perform key functions that it has licensed from Opalis S.A. for its Sagent Automation product. This license may not continue to be available to the Company on commercially reasonable terms. The loss of this license could result in delays or reductions of shipments of the Sagent Automation product until equivalent software could be developed, identified, licensed and integrated, which could materially adversely affect the Company's business, financial condition and operating results.

EMPLOYEES

As of December 31, 1998, the Company had a total of 152 employees, of whom 147 were based in the United States and 4 were based internationally. Of the total, 60 were engaged in sales and marketing, 43 in research and development, 32 in professional services and customer support, and 17 in finance, administration and corporate operations. The Company's future performance depends in significant part on its continuing ability to attract, train and retain highly qualified technical, sales, service, marketing and managerial personnel. None of the Company's employees is represented by a labor union. The Company has not experienced any work stoppages and considers its relations with its employees to be good. See "Risk Factors--We Need to Recruit Additional Personnel and We Depend on Our Key Personnel."

FACILITIES

The Company's principal offices currently occupy approximately 34,000 square feet in Mountain View, California pursuant to a lease which expires in October 2003. In addition, the Company also leases executive suites on a short-term basis for North American offices in Englewood, Colorado; Atlanta, Georgia; Orlando, Florida; Plantation, Florida; Chicago, Illinois; Wellesley, Massachusetts; New York, New York; Bala Cynwyd, Pennsylvania; Houston, Texas; Alexandria, Virginia and Toronto, Ontario. The Company believes that its facilities are adequate for the next 12 months and that, if required, suitable additional space will be available on commercially reasonable terms to accommodate expansion of the Company's operations.

LEGAL PROCEEDINGS

In May 1998, Acta filed suit against the Company alleging copyright infringement of certain of its software code. In addition, Acta alleged that the Company committed conversion, fraud and unfair competition. Acta sought a declaration that it did not misappropriate any of the Company's trade secrets. Acta also sought injunctive relief, monetary damages, costs and attorneys' fees. In May 1998, the Company filed suit against Acta and its founders alleging misappropriation of the Company's trade secrets, breach of contract, violation of the covenant of good faith and fair dealing, breach of confidence, fraud and unfair competition. The Company and Acta have agreed to mediate the dispute; however, this mediation may not be successful. If the dispute is not resolved in mediation and the parties do not otherwise settle the dispute, the Company could incur substantial expenses and the attention of the Company's development and management personnel may

42

be diverted. Litigation of this type is inherently uncertain, especially because it involves complex technical issues. The Company can give no assurance that it will prevail in the litigation against Acta or that it will successfully defend Acta's claim. See "Risk Factors--Risks Associated with Intellectual Property."

43

MANAGEMENT

EXECUTIVE OFFICERS AND DIRECTORS

The executive officers and directors of the Company as of January 29, 1999 are as follows:

                   NAME                     AGE                   POSITION
                   ----                     ---                   --------
Kenneth C. Gardner........................  48     President, Chief Executive Officer and
                                                   Director
John E. Zicker............................  42     Executive Vice President, Technology,
                                                   Chief Technology Officer and Director
W. Virginia Walker........................  53     Executive Vice President, Finance and
                                                   Administration, and Chief Financial
                                                   Officer
Thomas M. Lounibos........................  42     Executive Vice President, Sales and
                                                   Marketing
Kenneth C. Holcomb........................  49     Vice President, Operations
Michael P. Venerable......................  36     Vice President, Professional Services
Shanda Bahles (a)(b)......................  43     Director
Richard W. Shapero(a)(b)..................  51     Director
Jeffrey T. Webber.........................  46     Director
Klaus S. Luft(c)..........................  57     Director designee


(a) Member of the Audit Committee.

(b) Member of the Compensation Committee.

(c) The Board of Directors has appointed Mr. Luft to the Board of Directors, and Mr. Luft has agreed to join, effective as of the first meeting of the Board of Directors following completion of the offering.

Kenneth C. Gardner. Mr. Gardner has been President, Chief Executive Officer and a director since commencement of operations in June 1995. From March 1994 until March 1995, Mr. Gardner was Vice President of Products at Borland International, Inc. ("Borland"), which has since changed its name to Inprise Corporation, an enterprise applications company. From February 1992 until March 1994, Mr. Gardner was President, Chief Executive Officer and a co-founder of ReportSmith, Inc. ("ReportSmith"), a database report applications company, which was purchased by Borland in 1994. Mr. Gardner is a director of ObjectSwitch Corp., Data Sage, Inc. and CommerceOne Inc., which are privately held companies. Mr. Gardner received his B.S.C. degree in Finance from the University of Louisville.

John E. Zicker. Mr. Zicker has been Executive Vice President, Technology, Chief Technology Officer and a director since the Company's commencement of operations in June 1995. From March 1994 until May 1995, Mr. Zicker was Director of Client/Server Development at Borland. From February 1992 until March 1994, Mr. Zicker was Vice President of Technology and a co-founder of ReportSmith. Mr. Zicker has 13 years experience in software development and image processing at NASA Ames Research Center, Lawrence Livermore Laboratories and the Stanford Linear Accelerator Center. Mr. Zicker received his B.S. degree in Electrical Engineering at the University of California at Davis and his M.S. degree in Electrical Engineering from the University of Wisconsin at Madison.

W. Virginia Walker. Ms. Walker has been Executive Vice President, Finance and Administration, and Chief Financial Officer since January 1998. From June 1996 to January 1998, Ms. Walker pursued personal interests. From November 1995 until June 1996, Ms. Walker was Executive Vice President of Finance and Administration, Chief

44

Financial Officer and Secretary of JTS Corporation, a publicly traded disk drive manufacturer. From May 1985 until September 1995, Ms. Walker worked at Scios Nova, Inc., a publicly traded biopharmaceutical company, where she held the positions of Vice President of Finance and Administration and Chief Financial Officer. Ms. Walker received her B.S. degree in Business Administration, Accounting from San Jose State University.

Thomas M. Lounibos. Mr. Lounibos has been Executive Vice President, Sales and Marketing since January 1999. Mr. Lounibos was the Company's Executive Vice President, Worldwide Sales, from October 1998 until January 1999 and was the Company's Vice President, Sales from March 1996 until October 1998. From October 1995 until March 1996, Mr. Lounibos was Vice President of Sales for ParcPlace-DigiTalk Incorporated ("ParcPlace-DigiTalk"), an object-oriented programming tools company, and from November 1993 until October 1995 Mr. Lounibos was Vice President of Sales for DigiTalk, Incorporated, which was acquired by ParcPlace Incorporated. Prior to joining DigiTalk, Mr. Lounibos worked for Knowledgeware, Incorporated, a software company, where he served as Vice President of Sales--Western United States and Vice President of Marketing. Mr. Lounibos received his B.S. degree in Business Economics from the University of San Francisco.

Kenneth C. Holcomb. Mr. Holcomb has been Vice President, Operations since March 1998. From March 1997 until February 1998, Mr. Holcomb was Vice President, Operations of Pilot Network Services, Inc., a publicly-traded network security company. From May 1996 until February 1997, Mr. Holcomb was Vice President, Systems Integration of WorldCom, Inc., a publicly traded telecommunications company. From January 1996 until May 1996, Mr. Holcomb was Vice President, Internet Development of MFS Communications Company, Inc., a telecommunications company. From January 1992 until December 1996, Mr. Holcomb was Senior Vice President, Customer Service and Operations of MFS Datanet, Inc., and subsidiary of MFS Communications, Inc. a data communications company. Mr. Holcomb received his B.A. degree in Business Administration, Finance, from the University of Notre Dame.

Michael P. Venerable. Mr. Venerable has been Vice President, Sagent Professional Services since March 1998. In March 1992, Mr. Venerable founded Talus, a data warehousing consulting firm, and served as its President until February 1998, when the Company acquired Talus. Mr. Venerable received his B.S. degree in Criminal Justice from the University of Dayton.

Shanda Bahles. Ms. Bahles has been a director of the Company since May 1995. Since May 1991, Ms. Bahles has been a General Partner of El Dorado Ventures, a venture capital firm. Ms. Bahles joined El Dorado Ventures as an associate in June 1987. From 1979 to 1985, Ms Bahles held various engineering, marketing and management positions with Millennium Systems, Inc., a systems integration company, and Fortune Systems Corporation, a workstation manufacturer. Ms. Bahles is a director of Pilot Network Services, Inc., a publicly traded company, and Women.com Networks, Inc., Poet Holdings, Inc. and MS2, Inc., which are privately held companies. Ms. Bahles received her B.S.E.E. and M.B.A. degrees from Stanford University.

Richard W. Shapero. Mr. Shapero has been a director of the Company since May 1995. Since April 1993, Mr. Shapero has been a General Partner of Crosspoint Venture Partners, a venture capital firm. From January until June 1992, Mr. Shapero was Chief Operating Officer of Shiva Corporation, a networking company. Previously, he was a Vice President of Sun Microsystems, Inc., Senior Director of Marketing of AST Research, Inc. and held marketing and sales positions at Informatics General Corporation and UNIVAC's

45

Communications Division. Mr. Shapero is a director of Covad Communications Group, Inc., a publicly traded company, and Digital Island, Inc., Diamond Lane Communications Corporation, NetBoost Corporation, Fabrik Communications, Inc., ObjectSwitch Corp., Jetstream Communications, Inc., AristaSoft Corporation and iBeam Broadcasting Corporation, which are privately held companies. Mr. Shapero received his B.A. degree in English from the University of California at Berkeley.

Jeffrey T. Webber. Mr. Webber has been a director of the Company since September 1995. Mr. Webber founded, and since January 1991 has served as President of, R.B. Webber & Company, Inc., a management consulting firm. From 1987 to January 1991, he was a partner of Edgar, Dunn & Company, a management consulting firm. Mr. Webber serves as a director of Sybase, Inc., a publicly traded company, and CommerceOne, Inc., enCommerce, Inc., Persistence Software, Inc., Spear Technologies, Inc. and Workwise Software, Inc., which are privately held companies. Mr. Webber received his B.A. degree in American Studies from Yale University.

Klaus S. Luft. Mr. Luft is the founder and President of MATCH -- Market Access for Technology Services GmbH, a provider of sales and marketing services to high technology companies, since February 1994. Mr. Luft is also the founder, owner and President of ISAR-Vermogensverwaltung GbR mbH ("ISAR"). Since August 1990, Mr. Luft has served as an International Advisor and Vice-Chairman of Goldman Sachs Europe Limited, an investment bank. From March 1986 to November 1989, Mr. Luft was Chief Executive Officer of Nixdorf Computer AG, a manufacturer of computer systems in Paderborn, Germany, where he also held various other executive positions in marketing, manufacturing and finance for more than 17 years. Mr. Luft is a director of Dell Computer Corporation, a publicly traded company. Mr. Luft received his German Arbitur in Bruchsal, Germany.

BOARD OF DIRECTORS AND COMMITTEES

Following the offering, the Company's Board of Directors (the "Board") will consist of six directors divided into three classes with each class serving for a term of three years. At each annual meeting of stockholders, directors will be elected by the holders of the Common Stock to succeed those directors whose terms are expiring. Mr. Shapero and Ms. Bahles are Class I directors whose terms will expire in 2000; Mr. Webber is a Class II directors whose terms will expire in 2001; and Messrs. Gardner and Zicker are Class III directors whose terms will expire in 2002.

The Board has a Compensation Committee and an Audit Committee. The Compensation Committee, which is comprised of Ms. Bahles and Mr. Shapero, administers the Amended 1995 Plan, the 1998 Plan and the 1999 Purchase Plan and all matters concerning executive compensation. The Audit Committee, which is comprised of Ms. Bahles and Mr. Shapero, approves the Company's independent auditors, reviews the results and scope of annual audits and other accounting related services, and evaluates the Company's internal audit and control functions. Each of these committees was established in February 1997.

DIRECTOR COMPENSATION

The Company does not pay any compensation to directors for serving in that capacity, nor does it reimburse directors for expenses incurred in attending board meetings. The Board has the discretion to grant options to non-employee directors pursuant to the Director Plan. See "Management--Employee Benefit Plans--Director Plan."

46

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Compensation Committee is currently comprised of Ms. Bahles and Mr. Shapero. Neither of these individuals has at any time been an officer or employee of the Company. Prior to formation of the Compensation Committee, all decisions regarding executive compensation were made by the full Board. No interlocking relationship exists between the Board or Compensation Committee and the board of directors or compensation committee of any other Company, nor has any such interlocking relationship existed in the past.

LIMITATION ON LIABILITY AND INDEMNIFICATION MATTERS

The Company's Amended and Restated Certificate of Incorporation (the "Amended Certificate of Incorporation") limits the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a corporation shall not be personally liable for monetary damages for breach of their fiduciary duties as directors, except for liability (1) for any breach of their duty of loyalty to the corporation or its stockholders, (2) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (3) for unlawful payments of dividends or unlawful Stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law or (4) for any transaction from which the director derived an improper personal benefit.

The Company's Bylaws provide that the Company shall indemnify its directors and executive officers and may indemnify its other officers and employees and agents and other agents to the fullest extent permitted by law. The Company believes that indemnification under its Bylaws covers at least negligence and gross negligence on the part of indemnified parties. The Company's Bylaws also permit the Company to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in such capacity, regardless of whether the Bylaws would permit indemnification.

The Company has entered into agreements to indemnify its directors and officers, in addition to indemnification provided for in the Company's Bylaws. These agreements, among other things, indemnify the Company's directors and officers for certain expenses (including attorneys' fees), judgments, fines and settlement amounts incurred by any such person in any action or proceeding, including any action by or in the right of the Company, arising out of such person's services as a director or officer of the Company, any subsidiary of the Company or any other Company or enterprise to which the person provides services at the request of the Company. In addition, the Company intends to obtain directors' and officers' insurance providing indemnification for certain of the Company's directors, officers and employees for certain liabilities The Company believes that these provisions, agreements and insurance are necessary to attract and retain qualified directors and officers.

At present, there is no pending litigation or proceeding involving any director, officer, employee or agent of the Company where indemnification will be required or permitted. The Company is not aware of any threatened litigation or proceeding that might result in a claim for such indemnification.

EXECUTIVE COMPENSATION

The following table sets forth information concerning the compensation that the Company paid during the year ended December 31, 1998 to the Company's Chief Executive Officer and each of the Company's other four most highly compensated

47

executive officers whose salary and bonus exceeded $100,000 during such fiscal year (collectively, the "Named Officers").

SUMMARY COMPENSATION TABLE

                                                            LONG-TERM
                                                           COMPENSATION
                                                           ------------
                                    ANNUAL COMPENSATION     SECURITIES
                                    --------------------    UNDERLYING       ALL OTHER
   NAME AND PRINCIPAL POSITION      SALARY($)   BONUS($)    OPTIONS(#)    COMPENSATION(A)
   ---------------------------      ---------   --------   ------------   ---------------
Kenneth C. Gardner................  $225,000    $ 90,000          --           $366
  President and Chief Executive
  Officer
John E. Zicker....................   150,000      60,000          --            120
  Executive Vice President,
  Technology and Chief Technology
  Officer
W. Virginia Walker................   173,965      69,586     180,000            240
  Executive Vice President,
  Finance and Administration and
  Chief Financial Officer
Thomas M. Lounibos................   164,590     124,420(b)    90,000           120
  Executive Vice President, Sales
  and Marketing
Perry S. Mizota(c)................   140,000      35,000          --             72
  Former Vice President, Marketing


(a) Consists of premiums paid on term life insurance.

(b) Consists of commissions calculated based on Company revenues.

(c) Perry S. Mizota resigned from his position as Vice President, Marketing of the Company effective January 29, 1999.

OPTION GRANTS IN LAST FISCAL YEAR

The following table sets forth each stock option grant to each of the Named Officers during the fiscal year ended December 31, 1998. No stock appreciation rights were granted during such fiscal year.

                                              INDIVIDUAL GRANTS(A)                     POTENTIAL REALIZABLE
                             ------------------------------------------------------      VALUE AT ASSUMED
                                NUMBER                                                 ANNUAL RATES OF STOCK
                             OF SECURITIES       % OF                                 PRICE APPRECIATION FOR
                              UNDERLYING     TOTAL OPTIONS   EXERCISE                     OPTION TERM(C)
                                OPTIONS       GRANTED TO     PRICE PER   EXPIRATION   -----------------------
           NAME                 GRANTED        EMPLOYEES     SHARE(B)       DATE         5%           10%
           ----              -------------   -------------   ---------   ----------   ---------   -----------
Kenneth C. Gardner.........          --             --            --            --          --            --
John E. Zicker.............          --             --            --            --          --            --
W. Virginia Walker.........     180,000          13.12%        $2.90      01/20/08    $328,283    $  831,934
Thomas M. Lounibos.........      90,000           6.56%         7.00      12/28/08     396,204     1,004,058
Perry S. Mizota............          --             --            --            --          --            --


(a) All options granted during the fiscal year were granted under the Amended 1995 Plan and the 1998 Plan (collectively, the "Stock Plans"). Each option becomes exercisable according to a vesting schedule, subject to the employee's continued employment with the Company. Certain options granted under the Amended 1995 Plan may be exercised immediately upon grant and prior to full vesting, subject to the optionee's entering a restricted stock purchase agreement with the Company

48

with respect to any unvested shares. Under such agreement, the optionee grants the Company the right to repurchase any unvested shares at their original purchase price in the event the optionee's employment relationship with the Company should terminate. The Company's right of repurchase will lapse and the purchaser will vest in the balance of the shares in a series of installments in accordance with the original vesting schedule of the exercised option. The exercise price for all these options may be paid in cash, check, promissory note, shares of Common Stock, through a cashless exercise procedure involving same-day sale of the purchased shares or any combination of such methods. The Board has discretion, subject to plan limits, to modify the terms of outstanding options and to reprice the options. The Company granted options to purchase 1,367,400 shares of Common Stock in the year ended December 31, 1998. Ms. Walker's option was granted under the Amended 1995 Plan in January 1998. One-forty-eighth of the shares subject to the option vest on each monthly anniversary of January 5, 1998. Mr. Lounibos' option was granted in December 1998 under the 1998 Plan. One-twenty-fourth of the shares subject to the option vest on each monthly anniversary after July 1, 1999.

(b) The exercise price per share of options granted represented the fair market value of the underlying shares of Common Stock on the dates the respective options were granted, as determined by the Board. The Company's Common Stock was not traded publicly at the time of the option grants to the Named Officers.

(c) Potential gains are net of the exercise price but before taxes associated with the exercise. The 5% and 10% assumed annual rates of compounded stock appreciation based upon the deemed fair market value are mandated by the rules of the Securities and Exchange Commission and do not represent the Company's estimate or projection of the future Common Stock price. Actual gains, if any, on stock option exercises are dependent on the future financial performance of the Company, overall market conditions and the option holder's continued employment through the vesting period. This table does not take into account any appreciation in the deemed fair market value of the Common Stock from the date of grant to the date of this Prospectus, other than the columns reflecting assumed rates of appreciation of 5% and 10%.

OPTION EXERCISES AND HOLDINGS

The following table sets forth for each of the Named Officers certain information concerning the number of shares acquired upon exercise of stock options in the fiscal year ended December 31, 1998 and the number of shares subject to both exercisable and unexercisable stock options at December 31, 1998. Also reported are values for "in-the-money" options that represent the positive spread between the respective exercise prices of outstanding stock options and the fair market value of the Common Stock as of December 31, 1998, as determined by the Board.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

                                                                                      VALUE OF UNEXERCISED
                                                        NUMBER OF UNEXERCISED         IN-THE-MONEY OPTIONS
                                                       OPTIONS AT DECEMBER 31,           AT DECEMBER 31,
                           SHARES         VALUE                1998(A)                     1998(A)(B)
                        ACQUIRED ON      REALIZED    ---------------------------   ---------------------------
        NAME            EXERCISE(A)       ($)(C)     EXERCISABLE   UNEXERCISABLE   EXERCISABLE   UNEXERCISABLE
        ----           --------------   ----------   -----------   -------------   -----------   -------------
Kenneth C. Gardner...          --               --     100,000             --       $450,000             --
John E. Zicker.......          --               --      80,000             --        360,000             --
W. Virginia Walker...     180,000               --          --             --             --             --
Thomas M. Lounibos...     230,000       $1,244,300     118,255        141,745        624,342       $232,853
Perry S. Mizota......          --               --      50,000             --        225,000             --


(a) Certain options granted under the Amended 1995 Plan may be exercised immediately upon grant and prior to full vesting, subject to the optionee's entering a restricted stock purchase agreement with the Company with respect to any unvested shares. Under such agreement, the optionee grants the Company an option to repurchase any unvested shares at their original purchase price in the event the optionee's employment relationship with the Company should terminate. The Company's right of

49

repurchase will lapse and the purchaser will vest in the balance of the shares in a series of installments in accordance with the original vesting schedule of the exercised options.

(b) Calculated by determining the difference between the fair market value of the securities underlying the option at December 31, 1998 ($7.00 per share, as determined by the Board) and the exercise price of the options.

(c) Calculated by determining the difference between the fair market value of the securities underlying the option on the exercise date and the exercise price paid for such shares.

EMPLOYMENT AGREEMENTS

The Company requires each of its employees to enter into confidentiality agreements prohibiting such employee from disclosing any confidential or proprietary information of the Company. In addition, the agreements generally provide that upon termination such employee will not work for a competitor and will not solicit Company customers and employees. At the time of commencement of employment, the Company's employees also generally sign offer letters specifying certain basic terms and conditions of employment. In general, employees of the Company are not subject to written employment agreements. However, in connection with the Company's acquisition of Talus, Michael Venerable entered into an employment agreement with the Company. See "Certain Transactions--Acquisition of Talus, Inc."

EMPLOYEE BENEFIT PLANS

1998 Plan. The 1998 Plan provides for grants to employees of incentive stock options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code"), and for grants to employees, directors and consultants of nonstatutory stock options and stock purchase rights ("SPRs"). The 1998 Plan was approved initially by the Board and the stockholders in December 1998. Unless terminated sooner, the 1998 Plan will terminate automatically in December 2008. A total of 2,440,000 shares of Common Stock are currently authorized for issuance pursuant to the 1998 Plan, of which 2,221,100 are still available for issuance. The number of shares reserved for issuance will be subject to an annual increase every May beginning in 2000 equal to the lesser of 1,500,000 shares of Common Stock, five percent of the outstanding shares of Common Stock on the date of increase or such lesser number of shares of Common Stock as approved by the Board. No employee, director or consultant may be granted in any fiscal year of the Company options to purchase more than 2,000,000 shares of Common Stock (except in connection with his or her initial service, in which he or she may be granted options to purchase an additional 2,000,000 shares). As of December 31, 1998, no shares had been issued upon the exercise of stock options or stock purchase rights granted under the 1998 Plan, 218,900 shares were subject to outstanding options, and 2,221,100 shares remained available for future grant.

The 1998 Plan may be administered by the Board or a committee of the Board (the "Committee," and collectively with the Board, the "Administrator"), which Administrator shall, in the case of options intended to qualify as "performance-based compensation" within the meaning of Section 162(m) of the Internal Revenue Code, consist of two or more "outside directors" within the meaning of Section 162(m) of the Internal Revenue Code. The Administrator has the power to determine the terms of the options or SPRs granted, including the exercise price, the number of shares subject to each option or SPR, the exercisability thereof, and the form of consideration payable upon such exercise. The Administrator also has the authority to reduce the exercise price of any option or SPR to the then current fair market value, if the fair market value of the Common Stock covered

50

by such option or SPR declined since the date of grant. In addition, the Board has the authority to amend, suspend or terminate the 1998 Plan, provided that no such action may affect any share of Common Stock previously issued and sold or any option previously granted under the 1998 Plan.

Unless otherwise determined by the Administrator, options and SPRs granted under the 1998 Plan are not transferable by the optionee, and each option and SPR is exercisable during the lifetime of the optionee only by such optionee. The exercise price for options may be paid in cash, check, promissory note, shares of Common Stock through a cashless exercise procedure involving same-day sale of the purchased shares or any combination of such exercise procedures. Options granted under the 1998 Plan must generally be exercised within 90 days of the end of optionee's status as an employee, director or consultant of the Company, or within 12 months after such optionee's termination by death or disability but in no event later than the expiration of the option's term. In the case of SPRs, unless the Administrator determines otherwise, the Restricted Stock Purchase Agreement shall grant the Company a repurchase option exercisable upon the voluntary or involuntary termination of the purchaser's employment with the Company for any reason (including death or disability). The purchase price for shares repurchased pursuant to the Restricted Stock Purchase Agreement shall be the original price paid by the purchaser and may be paid by cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall lapse at a rate determined by the Administrator. The exercise price of all incentive stock options granted under the 1998 Plan must be at least equal to the fair market value of the Common Stock on the date of grant. The exercise price of nonstatutory stock options and SPRs granted under the 1998 Plan is determined by the Administrator, but with respect to nonstatutory stock options intended to qualify as "performance-based compensation" within the meaning of
Section 162(m) of the Internal Revenue Code, the exercise price must at least be equal to the fair market value of the Common Stock on the date of grant. With respect to any participant who owns stock possessing more than 10% of the voting power of all classes of the Company's outstanding capital stock, the exercise price of any incentive stock option granted must equal at least 110% of the fair market value on the grant date and the term of such incentive stock option must not exceed five years. The term of all other options granted under the 1998 Plan may not exceed 10 years.

The 1998 Plan provides that in the event of a proposed dissolution or liquidation of the Company, the Administrator will notify each optionee of such proposed transaction. The Administrator in its discretion may provide for an optionee to have the right to exercise his or her option until 10 days prior to such transaction, including shares as to which the option would not otherwise be exercisable. In addition, the Administrator may provide that any Company repurchase option applicable to any shares purchased upon exercise of an option or SPR shall lapse as to all such shares, provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not been previously exercised, an option or SPR will terminate immediately prior to the consummation of such proposed action.

The 1998 Plan provides that in the event of a merger of the Company with or into another corporation or a sale of substantially all of the Company's assets, each option must be assumed or an equivalent option substituted by the successor corporation (or its parent or subsidiary). If the outstanding options are not assumed or an equivalent option is not substituted, the optionee will fully vest in and have the right to exercise the option or SPR as to all of the optioned stock, including shares which would not otherwise have been vested or exercisable. In the event that an option or SPR becomes exercisable in full in the

51

event of a merger or sale of assets, the Administrator will notify each optionee and the option or SPR will be fully exercisable for a period of fifteen (15) days from the date of such notice. The option or SPR will terminate upon the expiration of such period.

Amended 1995 Plan. The Amended 1995 Plan provides grants to employees of incentive stock options within the meaning of Section 422 of the Internal Revenue Code, and for grants to employees, directors and consultants of nonstatutory stock options and SPRs. The original plan was approved initially by the Board and the stockholders in May 1995. The Amended 1995 Plan was approved by the Board in July 1998 and the stockholders in September 1998. A total of 3,276,000 shares of Common Stock were authorized for issuance pursuant to the Amended 1995 Plan. As of December 31, 1998, 1,214,443 shares had been issued upon the exercise of stock options or stock purchase rights granted under the Amended 1995 Plan and 2,056,580 shares were subject to outstanding options, and no shares remain available for future grant. The terms of the Amended 1995 Plan are substantially similar to those of the 1998 Plan. The Board terminated the Amended 1995 Plan as to new option grants in December 1998.

Director Plan. The Board has the discretion to grant options to non-employee directors pursuant to the Director Plan. The Director Plan was adopted by the Board in January 1999, and is subject to stockholder approval, but it will in no event become effective until the date of this offering. The Director Plan has a term of 10 years, unless terminated sooner by the Board. A total of 150,000 shares of Common Stock have been reserved for issuance under the Director Plan.

The Board has the authority to determine the terms of the options granted including the exercise price, number of shares subject to each option, exercisability thereof and form of consideration payable upon such exercise. Options outstanding at the end of an optionee's tenure as a director may be exercised only to the extent exercisable at the time of such cessation of service as a director. No option granted under the Director Plan is transferable by the optionee other than by will or the laws of descent and distribution, and each option is exercisable, during the lifetime of the optionee, only by such optionee. In the event of a merger of the Company or the sale of substantially all of the assets of the Company, each outstanding option will become fully vested and exercisable for all of the option shares, unless such outstanding option are assumed or substituted by the successor corporation (or its parent or subsidiary). In the event either outstanding options are assumed or an equivalent option substituted by the successor corporation, each outstanding option will continue to become exercisable in accordance with its original exercise schedule. If an outstanding option is assumed or substituted and the optionee's status as a director or as a director of the successor corporation terminates other than upon a voluntary resignation by the optionee, then the option will become immediately vested exercisable for all of the option shares.

1999 Purchase Plan. The 1999 Purchase Plan was adopted by the Board in January 1999 and will be submitted the stockholders in February 1999. A total of 450,000 shares of Common Stock has been reserved for issuance under the 1999 Purchase Plan. The number of shares reserved under the 1999 Purchase Plan will be subject to an annual increase every January equal to the lesser of the number of shares optioned during the prior year or a lesser amount determined by the Board. The 1999 Purchase Plan, which is intended to qualify under Section 423 of the Internal Revenue Code, will be implemented with an initial offering period commencing on the date on which the Securities and Exchange Commission declares the Company's Registration Statement effective and ending on or about October 31, 1999. Subsequent offering periods shall each have a six-month duration

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commencing on the first trading day on or after May 1 and November 1 of each year. The 1999 Purchase Plan is administered by the Board or by a committee appointed by the Board. Employees are eligible to participate if they are customarily employed by the Company or any participating subsidiary for at least 20 hours per week and more than five months in any calendar year. The 1999 Purchase Plan permits eligible employees to purchase Common Stock through payroll deductions of up to 20% of an employee's compensation (excluding commissions, overtime and other bonuses and incentive compensation), subject to the limitations of Section 423(b)(8) of the Internal Revenue Code. The price of stock purchased under the 1999 Purchase Plan is 85% of the lower of the fair market value of the Common Stock at the beginning or end of each offering period or at the end of the offering period. Employees may end their participation at any time during an offering period, and they will be refunded their payroll deductions to date. Participation ends automatically upon termination of employment with the Company.

Rights granted under the 1999 Purchase Plan are not transferable by a participant other than by will, the laws of descent and distribution, or as otherwise provided under the 1999 Purchase Plan. The 1999 Purchase Plan provides that, in the event of a merger of the Company with or into another corporation or a sale of substantially all of the Company's assets, each option shall be assumed or an equivalent plan substituted by the successor corporation. If the successor corporation refuses to assume or substitute for the option, the offering period then in progress shall be shortened so that employees' rights to purchase stock under the 1999 Purchase Plan are exercised prior to the merger or sale of assets. The 1999 Purchase Plan will terminate in February 2009. The Board has the authority to amend or terminate the 1999 Purchase Plan, except that no such action may adversely affect any outstanding rights to purchase stock under the 1999 Purchase Plan.

401(k) Plan. The Company maintains in a tax-qualified employee savings and retirement plan (the "Company 401(k) Plan") which covers all of the Company's employees who are at least 21 years of age. Pursuant to the Company 401(k) Plan, eligible employees may defer up to 25% of their pre-tax earnings, subject to the limitation under Section 415 of the Internal Revenue Code and Internal Revenue Service's annual contribution limit. The Company 401(k) Plan permits additional discretionary matching contributions by the Company on behalf of all participants in the in such a percentage amount as may be determined annually by the Board. To date, the Company has made no such matching contributions. The Company 401(k) Plan is intended to qualify under Section 401 of the Internal Revenue Code, so that contributions by employees or by the Company to the Company 401(k) Plan, and income earned on plan contributions, are not taxable to employees until withdrawn from the Company 401(k) Plan, and so that contributions by the Company, if any, will be deductible by the Company when made. The trustee under the Company 401(k) Plan invests the assets of the Company 401(k) Plan at the direction of each participant in any of a number of investment options.

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CERTAIN TRANSACTIONS

EQUITY INVESTMENT TRANSACTIONS

In July, August and September 1996, the Company sold an aggregate of 2,615,680 shares of its Series C Preferred Stock ("Series C Preferred") at a price per share of $2.50. In August and September 1997 and January 1998, the Company sold an aggregate of 1,572,327 shares of its Series D Preferred Stock ("Series D Preferred") at a price per share of $3.18. In February and March 1998, the Company sold an aggregate of 1,895,370 shares of its Series E Preferred Stock ("Series E Preferred") at a price per share of $5.40. Simultaneously with the consummation of this offering, all shares of preferred stock will be converted into shares of Common Stock. Listed below are those directors, executive officers and stockholders who beneficially own five percent or more of the Company's securities who participated in such financings. The Company believes that the shares issued in these transactions were sold at the then fair market value and that the terms of these transactions were no less favorable than the Company could have obtained from unaffiliated third parties.

                                          SERIES C     SERIES D     SERIES E     AGGREGATE CASH
              STOCKHOLDER                 PREFERRED    PREFERRED    PREFERRED    CONSIDERATION
              -----------                 ---------    ---------    ---------    --------------
Entities affiliated with Crosspoint         531,708     411,130      925,926       $7,636,664
  Venture Partners(a)...................
Entities affiliated with El Dorado          531,708     411,130      485,185        5,256,662
  Ventures(b)...........................
Greylock Equity Limited Partnership.....    480,584     371,599      437,963        4,748,145
Entities affiliated with U.S. Venture     1,040,000     150,405           --        3,078,288
  Partners(c)...........................
Jeffrey T. Webber.......................      6,000(d)   58,262(e)    46,296(f)       450,272
Thomas M. Lounibos......................         --      45,785           --          145,596


(a) Includes shares purchased by Crosspoint Venture Partners LS 1993, Crosspoint 1993 Entrepreneurs Fund and Crosspoint Venture Partners LS 1997. Each of these funds has five general partners, each of whom shares voting and investment power over the shares held by such funds. Richard W. Shapero, a director of the Company, is a general partner of each of these entities. Mr. Shapero disclaims beneficial ownership of the shares held by these funds, except to the extent of his proportionate interest therein.

(b) Includes shares purchased by El Dorado Ventures III, L.P. and El Dorado Technology IV, L.P. Each of these funds has four general partners, each of whom shares voting and investment power over the shares held by such funds. Shanda Bahles, a director of the Company, is a general partner of each of these entities. Ms. Bahles disclaims beneficial ownership of the shares held by these funds, except to the extent of her proportionate interest therein.

(c) Includes shares purchased by U.S. Venture Partners IV, L.P., Second Ventures II, L.P., U.S.V.P. Entrepreneur Partners II, L.P. and 2180 Associates Fund. Presidio Management Group IV, L.P. ("Presidio"), which is the general partner of each of these entities, has five general partners, each of whom shares voting and investment power over the shares held by Presidio.

(d) Includes (1) 4,000 shares held by Mr. Webber directly and (2) 2,000 shares held by Mr. Webber's wife. Mr. Webber is a director of the Company.

(e) Includes (1) 51,973 shares held by The Entrepreneurs' Fund, L.P., whose General Partner is BW Management LLC, of which Mr. Webber is one of the managing directors, (2) 1,572 shares held by Mr. Webber's wife, (3) 1,572 shares held by Mr. Webber directly and (4) 3,145 shares held by the First Trust Corporation fbo Jeffrey T. Webber, which is Mr. Webber's IRA account. Mr. Webber is a director of the Company. Mr. Webber disclaims beneficial ownership of the shares held by The Entrepreneurs' Fund, L.P., except to the extent of his proportionate interest therein.

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(f) Includes (1) 39,352 shares held by The Entrepreneurs' Fund, L.P. and (2) 6,944 shares held by RBW Investments, LLC, of which Mr. Webber is the Managing Director. Mr. Webber disclaims beneficial ownership of the shares held by The Entrepreneurs' Fund, L.P. and RBW Investments, LLC, except to the extent of his proportionate interest therein.

RESTRICTED STOCK PURCHASE AGREEMENTS

In February 1998, Ms. Walker, the Company's Executive Vice President, Finance and Administration, and Chief Financial Officer, exercised two options to purchase an aggregate of 180,000 shares of Common Stock and entered into Notices of Early Exercise and Restricted Stock Purchase Agreements with respect to such exercises. Ms. Walker paid the $2.90 exercise price per share for such shares by delivery of a series of three year full-recourse promissory notes bearing interest at the rate of 5.47% per annum. The notes are secured by the shares of Common Stock purchased by Ms. Walker. As of December 31, 1998, $548,499 in unpaid principal and interest was outstanding in the aggregate under the notes.

ACQUISITION OF TALUS, INC.

In February 1998, the Company and Talus entered into an Agreement and Plan of Reorganization whereby the Company acquired Talus for total consideration of $1,170,000 in cash and 259,258 shares of Series E Preferred Stock. Michael P. Venerable, the Company's Vice President, Professional Services, was Talus' President at the time of the acquisition. Mr. Venerable received $571,051 in cash and 109,919 shares of Series E Preferred as consideration for his shares of Talus. In addition, in connection with the acquisition, Mr. Venerable entered into an employment agreement (the "Venerable Agreement") with the Company. Pursuant to the Venerable Agreement, Mr. Venerable received a salary of $123,000 and a bonus based upon performance milestones. The Company also granted Mr. Venerable an option to purchase 150,000 shares of Common Stock at an exercise price of $4.30 per share. Twenty percent of the shares subject to the option vested on the first anniversary of the date of the Venerable Agreement, 20% will vest on the second anniversary and 60% will vest on the third anniversary. In the event of a Change of Control (as defined in the Venerable Agreement) of the Company, the option will accelerate and become immediately exercisable if such options are not assumed. If Mr. Venerable's options are assumed and he is terminated for any reason other than for Cause (as defined in the Venerable Agreement) or if he voluntarily terminates his employment for Good Reason (as defined in the Venerable Agreement), after the Change of Control, the unvested portion of the option will accelerate and become immediately exercisable. If Mr. Venerable's employment is terminated for Cause or if he resigns for any reason other than Good Reason, he has agreed not to engage in a Restricted Business (as defined in the Venerable Agreement) or solicit any of the Company's employees for three years.

EXECUTIVE CHANGE OF CONTROL POLICY

The Board has adopted an Executive Change of Control Policy (the "Policy") applicable to key executives of the Company. The Policy provides that options granted to key executives ("Key Executive Options") will be assumed upon a Change of Control of the Company (as defined in the Policy). Furthermore, if a key executive remains an employee at the time of the Change of Control, the vesting of that individual's Key Executive Options will accelerate, and the Company's right to repurchase will lapse, as to 50% of the unvested portion of such options. If a key executive is terminated for any

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reason other than for Cause (as defined in the Policy) or terminates employment for Good Reason (as defined in the Policy) during the one-year period after the date of the Change of Control, then the remaining unvested portion of such Key Executive Options will accelerate and become immediately exerciseable, and the Company's right to repurchase the applicable portion of such shares will lapse.

TRANSACTIONS WITH ISAR

Klaus S. Luft, has agreed to join the Board as of the first meeting of the Board following completion of the offering, is a general partner of ISAR. The Company has entered into an agreement (the "ISAR Agreement") with ISAR, pursuant to which ISAR established a German company, Magnolia II Vermogensverwaltung GmbH ("Magnolia"), to distribute and support the Company's products in Germany, Austria and Switzerland (the "Territory"). The Company has entered into an agreement with Magnolia pursuant to which Magnolia has the exclusive right (other than with respect to value added resellers who have been or will be granted worldwide distribution rights) to distribute the Company's products in the Territory. Magnolia has agreed to pay the Company royalties on sales and maintenance of the Company's products. The Company has a call option to acquire Magnolia with cash, registrable securities or a combination of cash and registrable securities, with the acquisition price determined according to the date of the acquisition and Magnolia's revenues.

In May 1998, the Company and ISAR entered into a Common Stock Purchase Agreement pursuant to which ISAR purchased 28,000 shares of the Company's Common Stock for an aggregate purchase price of $120,960. In May 1998, the Company granted ISAR a Warrant to purchase 22,000 shares of the Company's Common Stock at an exercise price of $5.40 per share. Mr. Luft disclaims beneficial ownership of the shares and Warrant held by ISAR except to the extent of his proportionate interest therein.

OTHER TRANSACTIONS

The Company has entered into an Indemnification Agreement with each of its executive officers and directors.

The Company has granted options to certain of its executive officers. See "Management--Option Grants in Last Fiscal Year."

Holders of Preferred Stock are entitled to certain registration rights with respect to the Common Stock issued or issuable upon conversion thereof. See "Description of Capital Stock--Registration Rights."

The Company believes that all related-party transactions described above were on terms no less favorable than could have been otherwise obtained from unrelated third parties. All future transactions between the Company and its principal officers, directors and affiliates will be approved by a majority of the independent and disinterested members of the Board and will be on terms no less favorable that could be obtained from unrelated third parties.

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PRINCIPAL STOCKHOLDERS

The following table sets forth certain information with respect to beneficial ownership of the Common Stock as of December 31, 1998 and as adjusted to reflect the sale of Common Stock offered hereby, conversion of all outstanding shares of Preferred Stock into shares of Common Stock upon completion of this offering and the exercise of outstanding warrants which expire or are required to be exercised upon completion of this offering for (1) each person who is known by the Company to beneficially own more than five percent of the Common Stock, (2) each of the Company's directors, (3) each of the Named Officers and (4) all directors and executive officers as a group. Unless otherwise indicated, the principal address of each of the stockholders below is c/o Sagent Technology, Inc., 800 W. El Camino Real, Suite 300, Mountain View, California 94040.

                                                                   PERCENTAGE
                                                                   OWNED(A)(B)
                                                SHARES OWNED   -------------------
                                                PRIOR TO THE    BEFORE     AFTER
                                                OFFERING(A)    OFFERING   OFFERING
                                                ------------   --------   --------
5% STOCKHOLDERS:
  Entities affiliated with Crosspoint Venture
     Partners(c)..............................    4,179,876      22.4%          %
  Entities affiliated with El Dorado
     Ventures(d)..............................    3,739,135      20.0
  Greylock Equity Limited Partnership(e)......    3,379,034      18.1
  Entities affiliated with U.S. Venture
     Partners(f)..............................    1,190,405       6.4
DIRECTORS AND OFFICERS:
  Kenneth C. Gardner(g).......................    1,200,000       6.4
  Jeffrey T. Webber(h)........................      334,940       1.8
  John E. Zicker(i)...........................      968,000       5.2
  W. Virginia Walker(j).......................      180,000         *
  Perry S. Mizota(k)..........................      320,000       1.7
  Thomas M. Lounibos(l).......................      434,040       2.3
  Richard W. Shapero(c).......................    4,179,876      22.4
  Shanda Bahles(d)............................    3,739,135      20.0
  All directors and officers as a group
     (10 persons)(m)..........................   11,712,420      60.8


* Represents less than one percent of the total

(a) Assumes no exercise of the Underwriter's over-allotment option. Except pursuant to applicable community property laws or as indicated in the footnotes to this table, to the Company's knowledge, each stockholder identified in the table possesses sole voting and investment power with respect to all shares of Common Stock shown as beneficially owned by such stockholder.

(b) Percent of the outstanding shares of Common Stock, based on 18,669,377 shares outstanding as of December 31, 1998, treating as outstanding all shares of Common Stock issuable on exercise of options exercisable within 60 days of December 31, 1998 held by the particular beneficial owner and that are included in the first column.

(c) Principal address is The Pioneer Hotel Building, 2925 Woodside Road, Woodside, CA 94062. Number of shares includes (1) 3,155,547 shares held by Crosspoint Venture Partners LS 1993; (2) 925,926 shares held by Crosspoint Venture Partners LS 1997; and (3) 98,403 shares held by Crosspoint 1993 Entrepreneurs Fund. Crosspoint Venture Partners has five general partners. Each of these general partners shares voting and investment power over the shares held by Crosspoint Venture Partners. Richard W. Shapero, a director of the Company, is a general partner of Crosspoint Venture Partners. Mr. Shapero disclaims beneficial ownership of the shares held by such entities except to the extent of his proportionate pecuniary interest therein.

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(d) Principal address is 2400 Sand Hill Road, Suite 100, Menlo Park, CA 94025.
Number of shares includes (1) 3,172,773 shares held by El Dorado Ventures III L.P.; (2) 478,658 shares held by El Dorado Ventures IV, L.P.; (3) 81,177 shares held by El Dorado Technology IV, L.P.; and (4) 6,527 shares held by El Dorado Technology '98, L.P. El Dorado Ventures has four general partners. Each of these general partners shares voting and investment power over the shares held by El Dorado Ventures. Shanda Bahles, a director of the Company, is a general partner of El Dorado Ventures. Ms. Bahles disclaims beneficial ownership of the shares held by such entities except to the extent of her proportionate pecuniary interest therein.

(e) Principal address is 755 Page Mill Road, Suite A-100, Palo Alto, CA 94304.

(f) Principal address is 2180 Sand Hill Road, Suite 300, Menlo Park, CA 94025.
Number of shares includes (1) 1,026,129 shares held by U.S. Venture Partners IV, L.P.; (2) 124,993 shares held by Second Ventures II, L.P.; (3) 35,712 shares held by U.S.V.P. Entrepreneur Partners II, L.P.; and (4) 3,571 shares held by 2180 Associates Fund.

(g) Includes (1) 925,000 shares registered in the name of Kenneth C. Gardner and Patricia T. Gardner, Trustees of the Gardner Family Trust u/d/t dated September 6, 1996; (2) 100,000 shares registered in the name of Delaware Charter Guarantee & Trust Co., Trustee fbo Kenneth C. Gardner, IRA; (3) 75,000 shares registered in the name of trusts; and (4) an option, granted to Kenneth C. Gardner, to purchase 100,000 shares exercisable within 60 days of December 31, 1998.

(h) Includes (1) 207,692 shares registered in the name of Jeffrey T. Webber;
(2) 91,325 shares registered in the name of The Entrepreneurs' Fund, L.P.;
(3) 32,778 shares registered in the name of Mr. Webber's wife; and (4) 3,145 shares registered in the name of First Trust Corporation fbo Jeffrey T. Webber.

(i) Includes (1) 788,000 shares registered in the name of John E. Zicker; (2) 100,000 shares registered in the name of Delaware Charter Guarantee & Trust Co., Trustee fbo John E. Zicker, IRA; and (3) an option, granted to John E. Zicker, to purchase 80,000 shares, exercisable within 60 days of December 31, 1998.

(j) Includes 138,750 shares which are subject to a repurchase option held by the Company as of December 31, 1998.

(k) Includes an option to purchase 50,000 shares, exercisable within 60 days of December 31, 1998.

(l) Includes (1) an option to purchase an aggregate of 158,255 shares exercisable within 60 days of December 31, 1998 and (2) 45,575 shares which are subject to a repurchase option held by the Company as of December 31, 1998.

(m) Includes the directors and officers as listed and (1) an option, granted to Kenneth C. Holcomb, to purchase 46,510 shares, exercisable within 60 days of December 31, 1998; (2) 109,919 shares registered in the name of Michael P. Venerable; (3) an option, granted to Mr. Venerable, to purchase 150,000 shares, exercisable within 60 days of December 31, 1998; (4) 28,000 shares registered in the name of ISAR; and (5) a warrant, granted to ISAR, to purchase 22,000 shares, exercisable within 60 days of December 31, 1998.

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DESCRIPTION OF CAPITAL STOCK

Upon the closing of this offering, the authorized capital stock of the Company will consist of 70,000,000 shares of Common Stock, $0.001 par value, and 5,000,000 shares of Preferred Stock, $0.001 par value.

The following summary of certain provisions of the Common Stock and Preferred Stock does not purport to be complete and is subject to, and qualified in its entirety by, the provisions of the Amended Certificate of Incorporation, which is included as an exhibit to the Registration Statement of which this Prospectus is a part, and by the provisions of applicable law.

COMMON STOCK

After giving effect to the conversion of all previously outstanding preferred stock into shares of Common Stock, as of December 31, 1998, there were 18,669,377 shares of Common Stock outstanding held of record by approximately 144 stockholders. There will be shares of Common Stock outstanding (assuming no exercise of the Underwriters' over-allotment option and no exercise of certain outstanding options or warrants) after giving effect to the sale of Common Stock in the offering.

The holders of Common Stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Subject to preferences that may be applicable to any outstanding shares of Preferred Stock, the holders of Common Stock are entitled to receive ratably such dividends, if any, as may be declared by the Board out of funds legally available for the payment of dividends. See "Dividend Policy." In the event of a liquidation, dissolution or winding up of the Company, the holders of Common Stock are entitled to share ratably in all assets remaining after payment of liabilities and liquidation preferences of any outstanding shares of Preferred Stock. Holders of Common Stock have no preemptive rights or rights to convert their Common Stock into any other securities. There are no redemption or sinking fund provisions applicable to the Common Stock. All outstanding shares of Common Stock are fully paid and non-assessable, and the shares of Common Stock to be issued in the offering will be fully paid and non-assessable.

PREFERRED STOCK

Pursuant to the Amended Certificate of Incorporation the Board has the authority, without further action by the stockholders, to issue up to 5,000,000 shares of Preferred Stock in one or more series and to fix the designations, powers, preferences, privileges and relative participating, optional or special rights and the qualifications, limitations or restrictions thereof, including dividend rights, conversion rights, voting rights, terms of redemption and liquidation preferences, any or all of which may be greater than the rights of the Common Stock. The Board, without stockholder approval, can issue Preferred Stock with voting, conversion or other rights that could adversely affect the voting power and other rights of the holders of Common Stock. Preferred Stock could thus be issued quickly with terms calculated to delay or prevent a change in control of the Company or make removal of management more difficult. Additionally, the issuance of Preferred Stock may have the effect of decreasing the market price of the Common Stock, and may adversely affect the voting and other rights of the holders of Common Stock. At present, there are no shares of Preferred Stock outstanding, and the Company has no plans to issue any Preferred Stock.

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COMMON STOCK WARRANTS

Upon completion of the offering, the Company will have three warrants outstanding to purchase an aggregate of 18,306 shares of Common Stock, exerciseable as follows: (1) 5,539 shares at an exercise price of $6.50 per share; (2) 9,433 shares at an exercise price of $3.18 per share; and (3) 3,334 shares at an exercise price of $5.40 per share. These warrants expire 10 years from the date of execution or five years from the effective date of the offering, whichever is later.

REGISTRATION RIGHTS

Upon completion of the offering, the holders of an aggregate of approximately 14,800,000 shares of Common Stock will be entitled to certain rights with respect to the registration of such shares under the Securities Act. Under the terms of certain registration rights agreements, if the Company proposes to register any of its securities under the Securities Act of 1933, as amended (the "Securities Act"), either for its own account or for the account of other security holders exercising registration rights, such holders are entitled to notice of such registration and are entitled to include shares of Common Stock in the registration. The rights are subject to certain conditions and limitations, among them the right of the underwriters of an offering subject to the registration to limit the number of shares included in such registration. Holders of these rights may also require the Company to file a registration statement under the Securities Act at its expense with respect to their shares of Common Stock, and the Company is required to use its best efforts to effect such registration, subject to certain conditions and limitations. Furthermore, such holders may require the Company to file additional registration statements on Form S-3, subject to certain conditions and limitations.

DELAWARE ANTI-TAKEOVER LAW AND CERTAIN CHARTER AND BYLAWS PROVISIONS

Delaware Anti-Takeover Statute. The Company is subject to Section 203 of the Delaware General Corporation Law ("Section 203"), which, subject to certain exceptions, prohibits a Delaware corporation from engaging in any business combination with any interested stockholder for a period of three years following the date that such stockholder became an interested stockholder, unless: (1) prior to such date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; (2) upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding those shares owned (A) by persons who are directors and officers and (B) by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or (3) on or subsequent to such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66 2/3% of the outstanding voting stock that is not owned by the interested stockholder.

Section 203 defines business combination to include: (1) any merger or consolidation involving the corporation and the interested stockholder; (2) any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder; (3) subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;

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(4) any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation beneficially owned by the interested stockholder; or (5) the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation. In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or person affiliated with or controlling or controlled by such entity or person.

Amended Certificate of Incorporation. In February 1999, the Company submitted to its stockholders for approval the Amended Certificate of Incorporation, to provide: (1) for the authorization of the Board to issue, without further action by the stockholders, up to 5,000,000 shares of Preferred Stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof; (2) that any action required or permitted to be taken by stockholders of the Company must be effected at a duly called annual or special meeting of the stockholders and may not be effected by a consent in writing; (3) for a classified Board; (4) that vacancies on the Board, including newly created directorships, can be filled only be a majority of the directors then in office;
(5) that directors of the Company may be removed only for cause, and (6) for the elimination of cumulative voting effective upon such time as the Company ceases to be subject to Section 2115 of the California Corporations Code.

Bylaws. In January 1999, the Board approved certain amendments to the Bylaws to provide that special meetings of stockholders of the Company may be called only by the Chairman of the Board, the President of the Company or the Board.

These provisions are intended to enhance the likelihood of continuity and stability in the composition of the Board and in the policies formulated by the Board and to discourage certain types transactions that may involve an actual or threatened change of control of the Company. These provisions also are designed to reduce the vulnerability of the Company to an unsolicited proposal for a takeover of the Company that does not contemplate the acquisition of all of its outstanding shares or an unsolicited proposal for the restructuring or sale of all or part of the Company. Such provisions, however, could discourage potential acquisition proposals and could delay or prevent a change in control of the Company. Such provisions may also have the effect of preventing changes in the management of Sagent.

TRANSFER AGENT AND REGISTRAR

The transfer agent and registrar for the Company's Common Stock is
. 's address is , and its telephone number is .

LISTING

The Company has applied to list its Common Stock on the Nasdaq National Market under the trading symbol "SGNT". The Company has not applied to list its Common Stock on any other exchange or quotation system.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no market for the Common Stock. Future sales of substantial amounts of Common Stock in the public market could adversely affect the prevailing market price from time to time. Furthermore, because only a limited number of shares will be available for sale shortly after this offering, because of certain contractual and legal restrictions on resale (as described below), sales of substantial amounts of Common Stock in the public market after the restrictions lapse could adversely affect the prevailing market price and the Company's ability to raise equity capital in the future.

Upon completion of the offering, the Company will have outstanding an aggregate of shares of Common Stock, assuming no exercise of the Underwriters' over-allotment option and no exercise of outstanding options or outstanding warrants after December 31, 1998. Of these outstanding shares, the 18,669,377 shares sold in the offering will be freely tradeable without restriction or further registration under the Securities Act, unless purchased by "affiliates" of the Company as that term is defined in Rule 144 under the Securities Act. The remaining shares of Common Stock outstanding upon completion of the offering and held by existing stockholders will be "restricted securities," as that term is defined in Rule 144 under the Securities Act ("Restricted Shares"). Restricted Shares may be sold in the public market only if registered or if they qualify for an exemption from registration under Rules 144, 144(k) or 701 promulgated under the Securities Act, which rules are summarized below, or another exemption therefrom. Sales of the Restricted Shares in the public market, or the availability of such shares for sale, could adversely affect the market price of the Common Stock.

All officers, directors and certain other holders of Common Stock have entered into contractual "lock-up" agreements providing that they will not offer, sell, contract to sell or grant any option to purchase or otherwise dispose of shares of Common Stock owned by them or that could be purchased by them through the exercise of options for a period of 180 days after the date of this prospectus without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation. As a result of these contractual restrictions, notwithstanding possible earlier eligibility for sale under the provisions of Rules 144, 144(k) and 701, additional shares will be available for sale in the public market as follows: (1) no shares of Common Stock will be eligible for sale as of the effective date of this offering, (2) no additional shares will be eligible for sale beginning 90 days after the effective date of this offering, and (3) 18,404,766 additional shares will be eligible for sale beginning 180 days after the effective date of this offering, subject in some cases to certain volume limitations. Of the 264,611 remaining Restricted Shares, (1) 236,611 shares are subject to a repurchase option of the Company in the event of termination of employment and (2) 28,000 shares will not be eligible for sale pursuant to Rule 144 until the expiration of a one-year holding period in December 1999.

In general, under Rule 144 as currently in effect, beginning 90 days after the date of this Prospectus, a person (or persons whose shares are aggregated) who has beneficially owned Restricted Shares for at least one year, including persons who may be deemed to be "affiliates" of the Company, would be entitled to sell within any three-month period a number of shares that does not exceed the greater of: (1) one percent of the number of shares of Common Stock then outstanding (which will equal approximately shares immediately after this offering) or (2) the average weekly trading volume of the Common Stock as reported through the Nasdaq National Market during the four calendar weeks preceding the filing of a Form 144 with respect to such sale. Sales under Rule 144 are also subject to certain manner of sale provisions and notice

62

requirements and to the availability of current public information about the Company. Under Rule 144(k), a person who is not deemed to have been an affiliate of the Company at any time during the 90 days preceding a sale, and who has beneficially owned for at least two years the Restricted Shares proposed to be sold (including the holding period of any prior owner except an affiliate), is entitled to sell such shares without complying with the manner of sale, public information, volume limitation or notice provisions of Rule 144.

Subject to certain limitations on the aggregate offering price of a transaction and certain other conditions, Rule 701 permits resales of shares issued prior to the date an issuer becomes subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), pursuant to certain compensatory benefit plans and contracts. Such resales may be made commencing 90 days after the issuer becomes subject to the reporting requirements of the Exchange Act, in reliance upon Rule 144 but, in certain cases, without compliance with certain restrictions, including the holding period requirements. In addition, the Securities and Exchange Commission has indicated that Rule 701 will apply to typical stock options granted by an issuer before it becomes subject to the reporting requirements of the Exchange Act, along with the shares acquired upon exercise of such options, including exercises after the date the issuer becomes so subject. Securities issued in reliance on Rule 701 are restricted securities and, subject to the contractual restrictions described above, beginning 90 days after the date of this Prospectus, may be sold by persons other than affiliates subject only to the manner of sale provisions of Rule 144, and by affiliates under Rule 144 without compliance with its one-year minimum holding period requirement.

The Company has agreed not to sell or otherwise dispose of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock, or enter into any swap or similar agreement that transfers, in whole or in part, the economic risk of ownership of the Common Stock, for a period of 180 days after the date of this Prospectus, without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation, subject to certain limited exceptions.

The Company intends to file a registration statement under the Securities Act covering the shares of Common Stock subject to outstanding options or reserved for issuance under the Amended 1995 Plan, 1998 Plan, 1999 Purchase Plan and the Director Plan. Such registration statement is expected to be filed as early as the effectiveness of the registration statement covering the shares of Common Stock offered in this offering and will automatically become effective upon filing. Accordingly, shares registered under such registration statement will, subject to Rule 144 volume limitations applicable to affiliates and the expiration of a 180-day lockup period, be available for sale in the open market, except to the extent that such shares are subject to vesting restrictions with the Company or the contractual restrictions described above.

63

UNDERWRITING

Subject to the terms and subject to conditions contained in an Underwriting Agreement dated , 1999 (the "Underwriting Agreement"), the underwriters named below (the "Underwriters"), who are represented by Donaldson, Lufkin & Jenrette Securities Corporation, Hambrecht & Quist LLC and Piper Jaffray Inc. (the "Representatives"), have severally agreed to purchase from the Company the respective number of shares of Common Stock set forth opposite their names below:

                                                              NUMBER OF
                       UNDERWRITERS:                           SHARES
                       -------------                          ---------
Donaldson, Lufkin & Jenrette Securities Corporation.........
Hambrecht & Quist LLC.......................................
Piper Jaffray Inc. .........................................

                                                               -------
          Total.............................................
                                                               =======

The Underwriting Agreement provides that the obligations of the several Underwriters to purchase and accept delivery of the shares of Common Stock offered hereby are subject to approval by their counsel of certain legal matters and to certain other conditions. The Underwriters are obligated to purchase and accept delivery of all the shares of Common Stock offered hereby (other than those shares covered by the over-allotment option described below) if any are purchased.

The Underwriters initially propose to offer the shares of Common Stock in part directly to the public at the initial public offering price set forth on the cover page of this prospectus and in part to certain dealers (including the Underwriters) at such price less a concession not in excess of $ per share. The Underwriters may allow, and such dealers may re-allow, to certain other dealers a concession not in excess of $ per share. After the initial offering of the Common Stock, the public offering price and other selling terms may be changed by the Representatives at any time without notice. The Underwriters do not intend to confirm sales to any accounts over which they exercise discretionary authority.

DLJdirect Inc., an affiliate of Donaldson, Lufkin & Jenrette Securities Corporation and a member of the selling group, is facilitating the distribution of the shares sold in the offering over the Internet. The Underwriters have agreed to allocate a limited number of shares to DLJdirect Inc. for sale to its brokerage account holders.

Sagent has granted to the Underwriters an option, exercisable for 30 days after the date of this prospectus, to purchase, from time to time, in whole or in part, up to an aggregate of additional shares of Common Stock at the initial public offering price less underwriting discounts and commission. The Underwriters may exercise such option solely to cover over-allotments, if any, made in connection with the offering. To the extent that the Underwriters exercise such option, each Underwriter will become obligated, subject

64

to certain conditions, to purchase its pro rata portion of such additional shares based on such Underwriters' percentage underwriting commitment as indicated in the above table.

Sagent has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act, or to contribute to payments that the Underwriters may be required to make in respect thereof.

Each of Sagent, its executive officers, directors, stockholders and option holders has agreed, subject to certain exceptions, not to (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (2) enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any Common Stock (regardless of whether any of the transactions described in clause
(1) or (2) is to be settled by the delivery of Common Stock, or such other securities, in cash or otherwise) for a period of 180 days after the date of this prospectus without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation. In addition, during such 180-day period, Sagent has also agreed not to file any registration statement with respect to, and each of its executive officers, directors and certain stockholders of Sagent has agreed not to make any demand for, or exercise any right with respect to, the registration of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation.

Prior to the offering, there has been no established trading market for the Common Stock. The initial public offering price of the shares of Common Stock offered hereby will be determined by negotiation among Sagent and the Representatives. The factors to be considered in determining the initial public offering price include the history of and the prospects for the industry in which Sagent competes, the past and present operations of Sagent, the historical results of operations of Sagent, the prospects for future earnings of Sagent, the recent market prices of securities of generally comparable companies, and the general condition of the securities markets at the time of the offering.

Other than in the United States, no action has been taken by Sagent or the Underwriters that would permit a public offering of the shares of Common Stock offered hereby in any jurisdiction where action for that purpose is required. The shares of Common Stock offered hereby may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such shares of Common Stock be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of such jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any shares of Common Stock offered hereby in any jurisdiction in which such an offer or a solicitation is unlawful.

In connection with the offering, the Underwriters may engage in transactions that stabilize, maintain or otherwise affect the price of the Common Stock. Specifically, the Underwriters may over-allot the offering, creating a syndicate short position. The Underwriters may bid for and stabilize the price of the Common Stock. In addition, the underwriting syndicate may reclaim selling concessions from syndicate members and selected dealers if they repurchase previously distributed Common Stock in syndicate

65

covering transactions, in stabilizing transactions or otherwise. These activities may stabilize or maintain the market price of the Common Stock above independent market levels. The Underwriters are not required to engage in these activities, and may end any of these activities at any time.

LEGAL MATTERS

Certain legal matters with respect to the legality of the issuance of the shares of Common Stock offered hereby will be passed upon for the Company by Wilson Sonsini Goodrich & Rosati, Professional Corporation, Palo Alto, California. Arthur F. Schneiderman, a member of Wilson Sonsini Goodrich & Rosati, is Secretary of the Company. Mr. Schneiderman and investment partnerships, of which certain members of Wilson Sonsini Goodrich & Rosati are general partners, beneficially own an aggregate of 180,445 shares of the Company's Common Stock. Certain legal matters in connection with this offering will be passed upon for the Underwriters by Brobeck Phleger & Harrison LLP, Palo Alto, California.

EXPERTS

The consolidated balance sheets as of December 31, 1998 and 1997 and the consolidated statements of operations, stockholders' equity and cash flows for each of the three years in the period ended December 31, 1998 for Sagent Technology, Inc. included in this Prospectus and Registration Statement, have been included herein in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given upon the authority of such firm as experts in accounting and auditing.

The balance sheets as of December 31, 1997 and 1996 and the statements of operations and retained earnings and cash flows for the two years in the period ended December 31, 1997 for Talus, Incorporated included in this Prospectus and Registration Statement, have been included herein in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given upon the authority of such firm as experts in accounting and auditing.

66

AVAILABLE INFORMATION

We have filed with the SEC, Washington, D.C. 20549, under the Securities Act a registration statement on Form S-1 relating to the Common Stock offered hereby. This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto. For further information with respect to Sagent and the shares we are offering pursuant to this prospectus you should refer to the registration statement, including the exhibits and schedules thereto. Statements contained in this prospectus as to the contents of any contract, agreement or other document referred to are not necessarily complete, and you should refer to the copy of such contract or other document filed as an exhibit to the registration statement or such other document. You may inspect a copy of the registration statement without charge at the Public Reference Section of the SEC at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 or at the SEC's regional offices at 5670 Wilshire Boulevard, 11th Floor, Los Angeles, California 90036. The SEC maintains an Internet site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The SEC's World Wide Web address is www.sec.gov.

Sagent intends to furnish holders of the Common Stock with annual reports containing, among other information, audited financial statements certified by an independent public accounting firm and quarterly reports containing unaudited condensed financial information for the first three quarters of each fiscal year. Sagent intends to furnish such other reports as it may determine or as may be required by law.

67

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                              PAGE
                                                              ----
SAGENT TECHNOLOGY, INC.
Report of Independent Accountants...........................   F-2
Consolidated Balance Sheets as of December 31, 1997 and
  1998......................................................   F-3
Consolidated Statements of Operations for the years ended
  December 31, 1996, 1997 and 1998..........................   F-4
Consolidated Statements of Stockholders' Equity as of
  December 31, 1997
  and 1998..................................................   F-5
Consolidated Statements of Cash Flows for the years ended
  December 31, 1996, 1997 and 1998..........................   F-6
Consolidated Notes to Financial Statements..................   F-7
TALUS, INCORPORATED
Report of Independent Accountants...........................  F-24
Balance Sheets as of December 31, 1996 and 1997.............  F-25
Statements of Operations and Retained Earnings for the years
  ended December 31, 1996 and 1997..........................  F-26
Statements of Cash Flows for the years ended December 31,
  1996 and 1997.............................................  F-27
Notes to Financial Statements...............................  F-28
Pro Forma Consolidated Financial Statements (unaudited).....  F-33
Pro Forma Consolidated Statements of Operations for the year
  ended December 31, 1998 (unaudited).......................  F-34
Notes to Pro Forma Consolidated Financial Statements
  (unaudited)...............................................  F-35

F-1

REPORT OF INDEPENDENT ACCOUNTANTS

To the Stockholders and Board of Directors of Sagent Technology, Inc.:

In our opinion, the accompanying consolidated balance sheets and the related statements of operations and stockholders' equity and cash flows present fairly, in all material respects, the financial position of Sagent Technology, Inc. and its subsidiaries at December 31, 1997 and 1998, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 1998, in conformity with generally accepted accounting principles. These financial statements are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with generally accepted auditing standards which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above.

PricewaterhouseCoopers LLP
San Jose, California
January 27, 1999

F-2

SAGENT TECHNOLOGY, INC.

CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

ASSETS

                                                                         PRO FORMA
                                                                       STOCKHOLDERS'
                                                                          EQUITY
                                                    DECEMBER 31,       DECEMBER 31,
                                                 -------------------   -------------
                                                   1997       1998         1998
                                                 --------   --------   -------------
CURRENT ASSETS:
  Cash and cash equivalents....................  $  3,813   $  3,093
  Accounts receivable, net of allowance for
     doubtful accounts of $450 in 1997 and $508
     in 1998...................................     1,603      5,376
  Prepaid assets...............................       220        832
                                                 --------   --------
     Total current assets......................     5,636      9,301
  Property and equipment, net..................     1,396      3,044
  Other assets.................................       153        851
                                                 --------   --------
     Total assets..............................  $  7,185   $ 13,196
                                                 ========   ========

                        LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Accounts payable.............................  $    512   $  1,478
  Accrued liabilities..........................     1,383      4,216
  Deferred revenue.............................     1,077      1,304
  Current portion of capital lease
     obligations...............................       463      1,181
                                                 --------   --------
     Total current liabilities.................     3,435      8,179
  Long-term portion of capital lease
     obligations...............................       627      3,346
                                                 --------   --------
     Total liabilities.........................     4,062     11,525
                                                 --------   --------
  Commitments and contingencies (Note 5)

STOCKHOLDERS' EQUITY:
  Convertible preferred stock, par value $.001
     per share:
  Authorized: 13,056 shares in 1997 and 15,556
     in 1998;
  Issued and outstanding: 12,390 shares in 1997
     and 14,544 shares in 1998 and no pro forma
     shares (unaudited)........................        12         15           --
  (Liquidation value of $29,554 at December 31,
     1998)
  Common Stock, par value $.001 per share:
  Authorized: 20,000 shares in 1997 and 25,000
     shares in 1998;
  Issued and outstanding: 3,249 shares in 1997,
     4,125 shares in 1998 and 18,495 pro forma
     shares (unaudited)........................         3          4           19
  Additional paid-in capital...................    18,033     30,699       30,699
  Notes receivable from stockholder............                 (522)        (522)
  Cumulative translation adjustment............                  101          101
  Accumulated deficit..........................   (14,925)   (28,626)     (28,626)
                                                 --------   --------     --------
     Total stockholders' equity................     3,123      1,671     $  1,671
                                                 --------   --------     --------
     Total liabilities and stockholders'
       equity..................................  $  7,185   $ 13,196
                                                 ========   ========

The accompanying notes are an integral part of these consolidated financial statements.

F-3

SAGENT TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

                                                  FOR THE YEARS ENDED DECEMBER 31,
                                                  ---------------------------------
                                                    1996        1997        1998
                                                  --------    --------    ---------
REVENUES, NET:
  Licenses......................................  $   240     $ 5,728     $ 10,459
  Services......................................       39       1,350        6,584
                                                  -------     -------     --------
     Total revenues, net........................      279       7,078       17,043
                                                  -------     -------     --------
COST OF REVENUES:
  Licenses......................................      120         194          143
  Services......................................      127         679        4,923
                                                  -------     -------     --------
     Total cost of revenues.....................      247         873        5,066
                                                  -------     -------     --------
Gross profit....................................       32       6,205       11,977
                                                  -------     -------     --------
OPERATING EXPENSES:
  Sales and marketing...........................    2,727       5,929       12,037
  Research and development......................    3,425       4,969        6,013
  General and administrative....................    1,111       2,215        5,186
  Acquired in-process technology (Note 7).......                             2,425
                                                  -------     -------     --------
     Total operating expenses...................    7,263      13,113       25,661
                                                  -------     -------     --------
Loss from operations............................   (7,231)     (6,908)     (13,684)
Interest expense................................      (65)       (191)        (207)
Other income....................................      257         199          190
                                                  -------     -------     --------
Net loss........................................  $(7,039)    $(6,900)    $(13,701)
                                                  =======     =======     ========
Historical basic and diluted net loss per
  share.........................................  $ (2.67)    $ (2.41)    $  (3.47)
                                                  =======     =======     ========
Number of shares used in calculation of
  historical basic and diluted net loss per
  share.........................................    2,637       2,860        3,951
Pro forma net loss per share, basic and diluted
  (unaudited)...................................                          $  (0.74)
                                                                          ========
Shares used in computing pro forma net loss per
  share, basic and diluted (unaudited)..........                            18,495

The accompanying notes are an integral part of these consolidated financial statements.

F-4

SAGENT TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT PER SHARE DATA)

                                            CONVERTIBLE
                                          PREFERRED STOCK    COMMON STOCK     ADDITIONAL   CUMULATIVE    STOCKHOLDERS
                                          ---------------   ---------------    PAID-IN     TRANSLATION       NOTE       ACCUMULATED
                                          SHARES   AMOUNT   SHARES   AMOUNT    CAPITAL     ADJUSTMENT     RECEIVABLE      DEFICIT
                                          ------   ------   ------   ------   ----------   -----------   ------------   -----------
BALANCES, DECEMBER 31, 1995.............   8,122    $ 8     2,625      $2      $ 6,136        $             $            $   (986)
  Issuance of Common Stock at $.09
    per share...........................                       13                    1
  Issuance of Series C Preferred Stock
    at $2.50 per share for cash, net of
    issuance costs of $16,483...........   2,616      3                          6,525
  Repurchase of Common Stock at $.045
    per share...........................                      (18)                  (1)
  Stock options exercised...............                       14                    1
  Net loss..............................                                                                                   (7,039)
                                          ------    ---     -----      --      -------        ----          -----        --------
BALANCES, DECEMBER 31, 1996.............  10,738     11     2,634       2       12,662          --             --          (8,025)
  Issuance of Series C Preferred Stock
    at $2.50 per share for cash.........      79                                   198
  Issuance of Series D Preferred Stock
    at $3.18 per share for cash, net of
    issuance costs of $14,856...........   1,573      1                          4,983
  Stock options exercised...............                      615       1           67
  Issuance of Series C Preferred Stock
    warrant.............................                                            23
  Issuance of Common Stock warrant......                                           100
  Net loss..............................                                                                                   (6,900)
                                          ------    ---     -----      --      -------        ----          -----        --------
BALANCES, DECEMBER 31, 1997.............  12,390     12     3,249       3       18,033          --             --         (14,925)
  Issuance of Series D Preferred Stock
    at $3.18 per share for cash, net of
    issuance costs of $12,924...........      45                                   132
  Issuance of Series E Preferred Stock
    at $5.40 per share for cash, net of
    issuance costs of $7,821............   2,155      3                         11,625
  Stock options exercised...............                      715       1          235
  Repurchase of Series C Preferred Stock
    at $2.50 per share..................     (40)                                 (100)
  Repurchase of Series D Preferred Stock
    at $3.18 per share..................      (6)                                  (18)
  Repurchase of Common Stock............                      (57)                 (20)
  Issuance of Series E Preferred Stock
    warrant.............................                                            18
  Issuance of Common Stock warrants.....                                            96
  Exercise of Common Stock options at
    $5.50 per share.....................                       10                   55
  Cumulative translation adjustment.....                                                       101
  Issuance of notes receivable for
    Common Stock........................                      180                  522                       (522)
  Exercise of stock purchase right......                       28                  121
  Net loss..............................                                                                                  (13,701)
                                          ------    ---     -----      --      -------        ----          -----        --------
BALANCES, DECEMBER 31, 1998.............  14,544    $15     4,125      $4      $30,699        $101          $(522)       $(28,626)
                                          ======    ===     =====      ==      =======        ====          =====        ========


                                          STOCKHOLDERS'
                                             EQUITY
                                          -------------
BALANCES, DECEMBER 31, 1995.............    $  5,160
  Issuance of Common Stock at $.09
    per share...........................           1
  Issuance of Series C Preferred Stock
    at $2.50 per share for cash, net of
    issuance costs of $16,483...........       6,527
  Repurchase of Common Stock at $.045
    per share...........................          (1)
  Stock options exercised...............           1
  Net loss..............................      (7,039)
                                            --------
BALANCES, DECEMBER 31, 1996.............       4,649
  Issuance of Series C Preferred Stock
    at $2.50 per share for cash.........         198
  Issuance of Series D Preferred Stock
    at $3.18 per share for cash, net of
    issuance costs of $14,856...........       4,984
  Stock options exercised...............          68
  Issuance of Series C Preferred Stock
    warrant.............................          23
  Issuance of Common Stock warrant......         100
  Net loss..............................      (6,899)
                                            --------
BALANCES, DECEMBER 31, 1997.............       3,123
  Issuance of Series D Preferred Stock
    at $3.18 per share for cash, net of
    issuance costs of $12,924...........         132
  Issuance of Series E Preferred Stock
    at $5.40 per share for cash, net of
    issuance costs of $7,821............      11,628
  Stock options exercised...............         236
  Repurchase of Series C Preferred Stock
    at $2.50 per share..................        (100)
  Repurchase of Series D Preferred Stock
    at $3.18 per share..................         (18)
  Repurchase of Common Stock............         (20)
  Issuance of Series E Preferred Stock
    warrant.............................          18
  Issuance of Common Stock warrants.....          96
  Exercise of Common Stock options at
    $5.50 per share.....................          55
  Cumulative translation adjustment.....         101
  Issuance of notes receivable for
    Common Stock........................          --
  Exercise of stock purchase right......         121
  Net loss..............................     (13,701)
                                            --------
BALANCES, DECEMBER 31, 1998.............    $  1,671
                                            ========

The accompanying notes are an integral part of these consolidated financial statements.

F-5

SAGENT TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

                                                               YEARS ENDED
                                                               DECEMBER 31,
                                                      ------------------------------
                                                       1996       1997        1998
                                                      -------    -------    --------
CASH FLOWS FROM OPERATIONS:
  Net loss..........................................  $(7,039)   $(6,900)   $(13,701)
  Adjustments to reconcile net loss to net cash used
            in operating activities:
       Acquired in-process technology...............       --         --       2,425
       Depreciation and amortization................      268        835       1,445
       Fair value of stock warrants issued..........                 123         114
       Change in operating assets and liabilities,
          net of acquisition:
            Accounts receivable.....................     (152)    (1,451)     (3,773)
            Prepaid assets..........................      (67)       (99)       (550)
            Other assets............................     (105)        16      (1,011)
            Accounts payable........................      513        (72)        966
            Accrued liabilities.....................      221      1,136       2,833
            Deferred revenue........................       51      1,027         227
                                                      -------    -------    --------
Net cash used in operating activities...............   (6,310)    (5,385)    (11,025)
                                                      -------    -------    --------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Maturity of restricted investments................       26        150          --
  Purchase of restricted investments................     (150)                    --
  Purchase of property and equipment................   (1,143)    (1,072)     (2,696)
  Acquisition of Talus, Incorporated................       --         --      (1,170)
                                                      -------    -------    --------
Net cash used in investing activities...............   (1,267)      (922)     (3,866)
                                                      -------    -------    --------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from capital lease financings............      738        650       4,103
  Payments of principal under capital lease
     obligations....................................     (139)      (356)       (666)
  Proceeds from issuance of Preferred Stock, net of
     issuance costs.................................    6,527      5,183      10,360
  Repurchase of Common Stock........................       (1)        --         (20)
  Repurchase of Preferred Stock.....................       --         --        (118)
  Proceeds from issuance of Common Stock............        2         68         411
                                                      -------    -------    --------
Net cash provided by financing activities...........    7,127      5,545      14,070
     Effect of exchange rate changes in cash........       --         --         101
                                                      -------    -------    --------
Net decrease in cash and cash equivalents...........     (450)      (762)       (720)
Cash and cash equivalents, beginning of year........    5,025      4,575       3,813
                                                      -------    -------    --------
Cash and cash equivalents, end of year..............  $ 4,575    $ 3,813    $  3,093
                                                      =======    =======    ========
Supplemental disclosure of cash flow information:
  Cash payments for interest........................  $    65    $   184    $    191
Supplemental non-cash financing activities:
  Issuance of Preferred Stock warrants..............       --         23          18
  Issuance of Common Stock warrants.................       --        100          96
  Issuance of Common Stock for notes and interest
     receivable.....................................       --         --         522
Liabilities assumed in connection with acquisition
  of Talus, Incorporated:
  Fair value of assets acquired.....................                           3,526
  Cash paid.........................................                          (1,170)
  Preferred Stock issued............................                          (1,400)
                                                                            --------
     Liabilities assumed............................                        $    956
                                                                            ========

The accompanying notes are an integral part of these consolidated financial statements.

F-6

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS, EXCEPT PER SHARE DATA)

1. FORMATION AND BUSINESS OF THE COMPANY

Sagent Technology, Inc. (the "Company") develops, markets and supports software designed to address organizations' information access, analysis, and delivery needs.

The Company was incorporated under the laws of the State of California in April 1995 under the name of Savant Software, Inc. In June 1995, the Company changed its name to Sagent Technology, Inc. The Company was reincorporated under the laws of the State of Delaware in September 1998.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of Sagent Technology, Inc. and its wholly-owned subsidiaries, Sagent Technology Japan KK and Sagent Technology (Canada), Inc. All significant intercompany accounts and transactions have been eliminated.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

FOREIGN CURRENCY TRANSLATION

The functional currency of the Company's subsidiaries is the local currency. Accordingly, the Company applies the current rate method to translate the subsidiaries' financial statements into U.S. dollars. Translation adjustments are included as a separate component of stockholders' equity in the accompanying consolidated financial statements.

CASH AND CASH EQUIVALENTS

The Company considers all highly liquid investments with an original or remaining maturity of three months or less at the time of purchase to be cash equivalents.

BUSINESS RISK AND CONCENTRATION OF CREDIT RISK

The Company operates in one segment and its revenue is attributable to the sale of one product line and related maintenance, consulting and training services. The Company's future success will depend upon its ability to continue to improve its product and to develop new products to meet diverse and evolving customer demands.

Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of temporary cash investments (including money market accounts). The Company places its temporary cash investments with two major financial institutions. The Company maintains allowances for potential credit losses and such losses to date have been within management's expectations. There were no customers with

F-7

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

balances due to the Company in excess of 10% of aggregate accounts receivable at December 31, 1998.

FAIR VALUE OF FINANCIAL INSTRUMENTS

Carrying amounts of certain of the Company's financial instruments, including cash and cash equivalents, accounts receivable, accounts payable, accrued expenses and other liabilities, approximate fair value due to their short maturities. Based upon borrowing rates currently available to the Company for loans with similar terms, the carrying value of capital lease obligations approximates fair value.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost and depreciated on a straight-line basis over the estimated useful lives of the related assets, generally two to five years. Leased assets are amortized on a straight-line basis over the lesser of the estimated useful life or the lease term. Gains and losses upon asset disposal are taken into income in the year of disposition.

REVENUE RECOGNITION

The Company's revenues are derived from two sources, product license revenues and service revenues. License revenues are derived from product sales to end users, resellers and distributors and enterprise application vendors as well as royalties from enterprise application vendors. License revenues are based upon the number and capacity of servers on which a product is installed, as well as on a per user basis. Service revenues are derived from providing consulting and training, maintenance and support services to end users.

The Company recognizes revenues in accordance with the American Institute of Certified Public Accountants Statement of Position No. 97-2. License revenues from sales to end users are recognized upon shipment of the product, if a signed contract exists, the fee is fixed and determinable and collection is deemed probable. If an acceptance period is provided, revenue is recognized upon the earlier of customer acceptance or the expiration of that period. The Company recognizes royalty as revenues based on an enterprise application vendor's sell-through of the Company's products. Fees for services are charged separately from licenses. Service revenues from consulting and training are recognized upon completion of the work to be performed. Revenues from maintenance and support agreements which includes product updates are deferred and recognized on a straight-line basis as service revenues over the term of the related agreement, which is typically one year.

The Company performs ongoing credit evaluations of its customers' financial condition and does not require collateral. The Company maintains allowances for potential credit losses and the amount of such losses have been within management's expectations.

ADVERTISING

The Company expenses advertising costs as incurred. Advertising costs amounted to $137, $50, and $532 for 1996, 1997 and 1998, respectively.

F-8

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

INCOME TAXES

The Company accounts for income taxes in accordance with Financial Accounting Standards Board ("FASB") Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for Income Taxes." This statement prescribes the use of the liability method whereby deferred tax assets and liabilities are determined based on the differences between financial reporting and tax bases of assets and liabilities and measured at tax rates that will be in effect when the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred tax assets where it is more likely than not the deferred tax asset will not be realized.

STOCK-BASED COMPENSATION

In 1997, the Company adopted the disclosure provisions of SFAS No. 123, "Accounting for Stock-based Compensation." The Company has elected to continue accounting for stock-based compensation issued to employees using Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued to Employees," and, accordingly, pro forma disclosures required under SFAS No. 123 have been presented (See Note 9). Under APB No. 25 ("APB No. 25"), compensation expense is based on the difference, if any, on the date of the grant, between the fair value of the Company's Common Stock and the exercise price. Additionally, pursuant to SFAS No. 123, stock issued to non-employees is accounted for at the fair value of the equity instruments issued, or at the fair value of the consideration received, whichever is more reliably measurable.

RESEARCH AND DEVELOPMENT EXPENSES

Costs related to research, design and development of products are charged to research and development expense as incurred. Software development costs are capitalized beginning when a product's technological feasibility has been established and ending when a product is available for general release to customers. To date, completing a working model of the Company's products and general release have substantially coincided. As a result, the Company has not capitalized any software development costs.

RECLASSIFICATION

The Company has reclassified the presentation of certain prior year information to conform to the current year presentation. These changes had no effect on previously reported financial position or results of operations.

NET LOSS PER SHARE AND PRO FORMA NET LOSS PER SHARE

The Company computes net loss per share in accordance with SFAS No. 128, "Earnings per Share," ("SFAS No. 128") and The Securities and Exchange Commission ("SEC") Staff Accounting Bulletin No. 98 ("SAB 98"). Under the provisions of SFAS No. 128 and SAB 98, basic net loss per share is computed by dividing the net loss available to common stockholders for the period by the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed by dividing the net loss for the period by the weighted average number of common and common equivalent shares outstanding during the period. Options, warrants and Convert-

F-9

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

ible Preferred Stock were not included in the computation of diluted net loss per share because the effect would be antidilutive.

Pro forma net loss per share has been computed as described above and also gives effect, even if antidilutive, to common equivalent shares from Preferred Stock that will automatically convert upon the closing of the Company's initial public offering (using the as-if-converted method). If the offering contemplated by this Prospectus is consummated, all of the convertible preferred stock outstanding, as of the closing date will automatically be converted into an aggregate of approximately 14,544 shares of Common Stock based on the shares of Convertible Preferred Stock outstanding at December 31, 1998. Unaudited pro forma stockholders' equity at December 31, 1998, as adjusted for the conversion of Preferred Stock, is disclosed on the balance sheet.

A reconciliation of shares used in the calculation of historical and pro forma basic and diluted net loss per share follows:

                                                YEARS ENDED DECEMBER 31,
                                             ------------------------------
                                              1996       1997        1998
                                             -------    -------    --------
HISTORICAL NET LOSS PER SHARE, BASIC AND
  DILUTED:
  Net loss.................................  $(7,039)   $(6,900)   $(13,701)
                                             =======    =======    ========
  Shares used in computing net loss per
     share, basic and diluted..............    2,637      2,860       3,951
                                             =======    =======    ========
  Net loss per share, basic and diluted....  $ (2.67)   $ (2.41)   $  (3.47)
                                             =======    =======    ========
  Antidilutive securities including
     options, warrants and preferred stock
     not included in historical net loss
     per share calculations................   12,006     14,350      17,055
                                             =======    =======    ========
PRO FORMA NET LOSS PER SHARE:
  Net loss.................................                        $(13,701)
                                                                   ========
  Shares used in computing net loss per
     share, basic and diluted..............                           3,951
  Adjustment to reflect assumed conversion
     of convertible preferred stock........                          14,544
                                                                   --------
  Shares used in computing pro forma net
     loss per share, basic and diluted.....                          18,495
                                                                   ========
  Pro forma net loss per share, basic and
     diluted...............................                        $  (0.74)
                                                                   ========

RECENT ACCOUNTING PRONOUNCEMENTS

The American Institute of Certified Public Accountants ("AICPA") issued SOP No. 98-1, "Software for Internal Use," which provides guidance on accounting for the cost of computer software developed or obtained for internal use. SOP No. 98-1 is effective for financial statements for fiscal years beginning after December 15, 1998. The Company does not expect that the adoption of SOP No. 98-1 will have a material impact on its financial statements.

F-10

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

In June 1997, the FASB issued SFAS No. 130, "Reporting Comprehensive Income." SFAS No. 130 is effective for fiscal years beginning after December 15, 1997. There was no difference between the Company's net loss and its total comprehensive loss for the years ended December 31, 1996 and 1997. The only component of comprehensive income for the year ended December 31, 1998 related to a cumulative translation adjustment and amounted to $101.

During June 1997, the FASB issued SFAS No. 131, "Disclosures About Segments of an Enterprise and Related Information." SFAS No. 131 replaces SFAS No. 14, "Financial Reporting for Segments of a Business Enterprise" and changes the way the public companies report segment information. SFAS No. 131 is effective for fiscal years beginning after December 15, 1997 and has been adopted by the Company for the year ending December 31, 1998. The Company markets and sells its services primarily in North America and operates in one business segment.

In April 1998, the AICPA issued SOP 98-5 "Reporting on the Costs of Start-Up Activities." This standard requires companies to expense the costs of start-up activities and organization costs as incurred. In general, SOP 98-5 is effective for fiscal years beginning after December 15, 1998. The Company believes the adoption of SOP 98-5 will not have a material impact on its results of operations.

3. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

                                                    AS OF DECEMBER 31,
                                                   --------------------
                                                    1997         1998
                                                   -------      -------
Office equipment.................................  $   612      $ 2,166
Computer software and equipment..................    1,847        2,996
Leasehold improvements...........................       73           83
                                                   -------      -------
                                                     2,532        5,245
Less accumulated depreciation and amortization...   (1,136)      (2,201)
                                                   -------      -------
                                                   $ 1,396      $ 3,044
                                                   =======      =======

Property and equipment under capital leases consist of the following:

                                                      AS OF DECEMBER 31,
                                                      -------------------
                                                       1997        1998
                                                      -------    --------
Computer equipment..................................  $1,594     $ 2,208
Office equipment....................................     447       1,527
                                                      ------     -------
                                                       2,041       3,735
Less accumulated amortization.......................    (811)     (1,662)
                                                      ------     -------
                                                      $1,230     $ 2,073
                                                      ======     =======

F-11

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

4. ACCRUED LIABILITIES

Accrued liabilities consists of the following:

                                                       AS OF DECEMBER 31,
                                                       ------------------
                                                        1997       1998
                                                       -------    -------
Accrued employee compensation........................  $  530     $1,198
Sales returns and allowances.........................      --        830
Accrued taxes........................................      --        622
Accrued other........................................     853      1,566
                                                       ------     ------
                                                       $1,383     $4,216
                                                       ======     ======

5. COMMITMENTS AND CONTINGENCIES

The Company has entered into an equipment line of credit with a leasing company and a bank. See Note 6 of Notes to Consolidated Financial Statements. The capital lease obligations, which expire through January 2002 are collateralized by the related assets. Under the terms of the capital lease obligations, the Company is responsible for taxes, insurance and maintenance costs. The Company also leases various facilities under noncancelable operating leases expiring through August 2003. Future minimum lease payments under these leases at December 31, 1998, are as follows:

                                                      OPERATING     CAPITAL
                                                       LEASES       LEASES
                                                     -----------    -------
1999...............................................    $1,771       $1,404
2000...............................................     1,623        2,831
2001...............................................     1,491          628
2002...............................................     1,536            8
2003...............................................     1,312           --
                                                       ------       ------
Total minimum lease payments.......................    $7,733        4,871
                                                       ======
Less amount representing interest..................                   (344)
                                                                    ------
Present value of minimum lease payments............                  4,527
Current portion....................................                  1,181
                                                                    ------
                                                                    $3,346
                                                                    ======

Rent expense for the years ended December 31, 1996, 1997, and 1998 was $241, $606, and $1,112, respectively.

In May 1998, Acta Technology, Inc. ("Acta") filed suit in the United States District Court, Northern District of California (the "Federal Litigation") against the Company, and in June 1998, Acta filed an amended complaint. Acta alleged, among other things, that the Company committed copyright infringement of certain of its software code. In addition Acta alleged that the Company committed conversion, fraud and unfair competition. Acta sought a declaration that it did not misappropriate any trade secrets of the Company, injunctive relief, monetary damages, costs and attorneys' fees. The Company intends to vigorously contest Acta's claims in the Federal Litigation.

F-12

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

In May 1998, the Company filed suit against Acta and its founders (the "Defendants") in Superior Court of California, Santa Clara County (the "State Litigation"). The Company alleged that the Defendants misappropriated certain of the Company's trade secrets. In addition, the Company alleged breach of contract, violation of the covenant of good faith and fair dealing, breach of confidence, fraud and unfair competition. The Company is seeking injunctive relief and monetary damages, including costs and reasonable costs and reasonable attorneys' fees.

Both the Federal and State Litigation are currently pending. Although the Company does not believe such litigation will have a material impact on the Company, litigation, regardless of its outcome, could result in substantial cost and diversion of resources of the Company. On December 8, 1998, the parties stipulated in the State Litigation to enter into mediation, which has been scheduled for February 3, 1999, and which will address both the Federal and State Litigation.

6. LINE OF CREDIT

During 1997, the Company entered into a loan and security agreement with a bank under which the Company can borrow up to an aggregate amount of $4.8 million. The agreement is used to finance various leased assets and (see also Note 3) includes a revolving line of credit (revolving line) for up to $2 million and an equipment line of credit (equipment line) for up to $2.8 million. Both lines are collateralized by all assets of the Company, including receivables, equipment and intellectual property.

The revolving line consists of advances against eligible accounts receivable in an aggregate amount not to exceed the lesser of, the committed revolving line or the borrowing base, less any outstanding letters of credit. Advances against the revolving line bear interest at the bank's prime rate (7.75% at December 31, 1998) and are due no later than January 15, 2000. During 1998 advances totaled $1.75 million.

The equipment line consists of advances for the acquisition of equipment through May 5, 1999. Each advance bears interest at the bank's prime rate (7.75% at December 31, 1998) and is due in 36 monthly principal and interest payments. The equipment line matures on May 7, 2002.

Under these agreements, the Company is required to comply with certain covenants, among which are minimum quick ratios, debt to net worth ratios, tangible net worth ratios and profitability. As of December 31, 1998, the Company was not in compliance with certain of these covenants. Subsequent to December 31, 1998, the loan and security agreement was amended to waive the aforementioned covenant violations through the period ending December 31, 1998.

7. ACQUISITION OF BUSINESS

In February 1998, the Company acquired Talus, Incorporated for cash of approximately $1.2 million, 259 shares of preferred stock amounting to $1.4 million and the assumption of certain liabilities for an aggregate purchase price of $3.526 million. The Company accounted for the acquisition under the purchase method and, accordingly, the

F-13

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

purchase price was allocated to the fair value of tangible and intangible assets acquired and liabilities assumed.

The Company has allocated approximately $2.4 million of the purchase price to acquired in-process technology. The determination of the acquired in-process technology allocation was based upon recently issued guidance issued by the SEC to the AICPA SEC Regulations Committee and considered such factors as degree of completion, technological uncertainties, costs incurred and projected costs to complete. The value assigned to the acquired workforce was based on replacement cost. The allocation of the purchase price resulted in additional intangible assets (primarily non-compete agreements and the value of an acquired workplace) of $587, which as been capitalized and is being amortized on a straight line basis over six-months to three years. Amortization expense for the year ended December 31, 1998 was $102.

As of the date of acquisition, the Talus development project consisted of ongoing research and development efforts on decision support applications for manufacturing, food service and hospitality, and high technology. Based on management's estimates, the remaining research and development efforts relating to the completion of the technology were expected to continue into 2000. Accordingly, the cost to complete the inprocess technology was estimated based on the number of man months required to reach technological feasibility for the technology, the type of professional and engineering staff involved in the completion process and their fully burdened months' salaries. Management estimated the direct costs to achieve technological feasibility to be approximately $1,800.

The preliminary allocation of the Company's aggregate purchase price to the tangible and identifiable intangible assets acquired and liabilities assumed in connection with this acquisition were based primarily on estimates by independent appraisers of fair values. The allocation is summarized below:

                                                         TALUS
Acquired in-process technology.......................    $2,425
Current assets.......................................       494
Other intangibles....................................       587
Other assets.........................................        11
Goodwill.............................................         9
                                                         ------
          Total purchase price.......................    $3,526
                                                         ======

The excess of the purchase price over the fair value of the net tangibles and identifiable intangible assets acquired has been recorded as goodwill, which is being amortized on a straight-line basis over a period of three year.

8. CONVERTIBLE PREFERRED STOCK

Holders of Series A, B, C, D and E Preferred Stock are entitled to preferential noncumulative dividends at the rate of $.04, $.07, $.20, $.25 and $.43 per share, respectively, if and when declared by the Board of Directors. No dividends have been declared as of December 31, 1998. The holders of Series A, B, C, D and E shares Preferred Stock have liquidation preferences of $0.45, $0.90, $2.50, $3.18 and $5.40 per share, respectively, plus an amount equal to all declared but unpaid dividends. In the event

F-14

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

of liquidation, if the assets of the Company are insufficient to pay the entirety of such amounts to the preferred stockholders, the assets shall be distributed ratably among the preferred stockholders in proportion to their preferential amounts. Preferred stockholders are entitled to one vote for each share of Common Stock into which their Preferred Stock is convertible. After payment to the preferred stockholders of the full preferential amounts specified above, the remaining assets will be distributed ratably among the holders of the Common Stock.

At the option of the holder, and at any time after the date of issuance of such share, each share of Series A, B, C, D and E Preferred Stock is convertible on a one-for-one basis into shares of the Company Common Stock subject to adjustment for stock splits and certain dilutive issuances of securities. The shares will automatically convert into Common Stock upon the closing of an underwritten public offering of Common Stock under the Securities Act of 1933, as amended, with minimum proceeds of $10 million. As of December 31, 1998, the Company has reserved 14,544 shares of its Common Stock in the event of conversion of all Preferred Stock.

All preferred shareholders have a right to first refusal to purchase any new securities issued by the Company in proportion to the shares they currently hold as a percentage of the total shares the Company has outstanding. The holders of Preferred Stock have certain registration rights.

At December 31, 1998, Preferred Stock consists of the following:

                                                                    COMMON
                                    SHARES                          STOCK
                       SHARES     ISSUED AND                     RESERVED FOR   LIQUIDATION
     SERIES          AUTHORIZED   OUTSTANDING   PROCEEDS (NET)    CONVERSION       VALUE
     ------          ----------   -----------   --------------   ------------   -----------
A..................     2,800        2,567         $ 1,138         $ 2,567        $ 1,155
B..................     5,656        5,555           4,981           5,555          5,000
C..................     2,800        2,655           6,625           2,655          6,637
D..................     1,800        1,612           5,100           1,612          5,127
E..................     2,500        2,155          11,627           2,155         11,635
                       ------       ------         -------         -------        -------
                       15,556       14,544         $29,471         $14,544        $29,554
                       ======       ======         =======         =======        =======

9. RESTRICTED STOCK PURCHASE AGREEMENT:

The Company has sold shares of its Common Stock to founders and employees of the Company under agreements which provide for repurchase of the shares by the Company at the stock's original purchase price upon termination of employment of such persons. The Company's right to repurchase shares generally lapses as to 1/48 of the total shares on the date of purchase and 1/48 on the first day of each subsequent month thereafter until the founder or employee is fully vested. At December 31, 1998, 335 shares of Common Stock were subject to repurchase.

10. STOCK OPTION PLAN:

Under the 1995 Stock Option Plan (the "1995 Plan"), the Company initially reserved 1,200 shares of Common Stock for issuance to employees, officers, directors and

F-15

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

consultants of the Company. The Company amended the 1995 Plan in 1996, 1997 and 1998 to increase the number of shares reserved under the 1995 Plan to, in the aggregate, 1,800 shares, 2,800 shares and 3,276 shares, respectively.

Under the terms of the 1995 Plan, incentive stock options may be granted at prices not lower than fair market value at the date of grant, while nonqualified options may be granted at prices not lower than 85% of fair market value at the date of grant, each as determined by the Board of Directors. However, if an employee or other person who, at the time of the grant of such stock option, owns stock representing more than 10% of the voting power of all classes of stock in the Company, the exercise price may be no less than 110% of the fair market value per share on the date of grant. Options granted under the 1995 Plan are exercisable immediately, conditioned upon the optionee entering into a restricted stock purchase agreement, and generally vest to the extent of 25% of the shares granted 12 months from the vesting commencement date and the remainder to the extent of 1/48 of the options granted each month thereafter, such that all options granted will be vested four years from the vesting commencement date. Options granted expire 10 years from the date of grant.

In December 1998, the Board of Directors approved the 1998 Stock Option Plan (the "1998 Plan") which authorized 2,440 shares of the Common Stock as available for issuance to employees, officers, directors and consultants of the Company.

Under the terms of the 1998 Plan, incentive options may be granted at prices not lower than fair market value at the date of grant, while nonqualified options may be granted at prices as determined by the Administrator at the date of grant. However, if an employee or other person who, at the time of the grant of such stock option, owns stock representing more than 10% of the voting power of all classes of stock in the Company, the exercise price may be no less than 110% of the fair market value per share on the date of grant. In the case of nonqualified options intended to qualify as performance-based compensation, the exercise price shall be no less than 100% of fair market value on the date of grant.

Options granted under the 1998 Plan are generally exercisable one year after the vesting commencement date. Upon exercise of an option, the optionee shall enter into a restricted stock purchase agreement. Options generally vest to the extent of 25% of the shares granted 12 months from the vesting commencement date and the remainder to the extent of 1/48 of the shares granted each month thereafter, such that all options granted will be vested four years from the vesting commencement date. Options generally expire 10 years from the date of grant.

Upon adoption of the 1998 Plan, the Board of Directors approved the cessation of grants under the 1995 Plan and determined that all shares of Common Stock then reserved under the 1995 Plan for the future grant of stock options were no longer reserved for issuance.

At December 31, 1998, 1,158 shares were no longer subject to repurchase. Of the stock options exercised, 879 shares were no longer subject to repurchase.

F-16

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The following table summarizes activity under the Company's stock option plans for the years ended December 31, 1996, 1997 and 1998:

                                                                                WEIGHTED
                                                                    AGGREGATE   AVERAGE
                                       NUMBER OF   EXERCISE PRICE   EXERCISE    EXERCISE
                                        SHARES       PER SHARE        PRICE      PRICE
                                       ---------   --------------   ---------   --------
Options outstanding at January 1,
  1996...............................      625     $0.05 - $ 0.09    $    35     $0.06
  Options granted under the 1995
     Plan............................      558     0.09 - $ 0.25          72      0.13
  Options canceled under the 1995
     Plan............................      (13)    0.09 - $ 0.25          (2)     0.13
  Options exercised under the 1995
     Plan............................      (14)         0.05              (1)     0.05
                                         -----     -------------     -------     -----
Options outstanding at December 31,
  1996...............................    1,156     0.05 - $ 0.25         104      0.09
  Options granted under the 1995
     Plan............................    1,280      0.25 - $2.80       2,309      1.80
  Options canceled under the 1995
     Plan............................     (146)     0.09 - $2.50         (32)     0.22
  Options exercised under the 1995
     Plan............................     (535)     0.05 - $ .50         (47)     0.09
                                         -----     -------------     -------     -----
Options outstanding at December 31,
  1997...............................    1,755      0.05 - $2.80       2,334      1.33
  Options granted under the 1995
     Plan............................    1,148      2.90 - $6.50       5,094      4.43
  Options granted under the 1998
     Plan............................      219         7.00            1,532      7.00
  Options canceled under the 1995
     Plan............................     (182)     0.09 - $5.50        (418)     2.30
  Options exercised under the 1995
     Plan............................     (665)     0.05 - $5.50        (737)     1.11
                                         -----     -------------     -------     -----
Options outstanding at December 31,
  1998...............................    2,275     $0.05 - $7.00     $ 7,805     $3.43
                                         =====     =============     =======     =====

At December 31, 1997 and 1998, 496 shares and 2,221 shares, respectively, remained available for issuance.

The following table summarizes information with respect to stock options outstanding at December 31, 1998:

                          OPTIONS OUTSTANDING
                 -------------------------------------    OPTIONS EXERCISABLE
                                 WEIGHTED                ----------------------
                                 AVERAGE      WEIGHTED                 WEIGHTED
                   NUMBER       REMAINING     AVERAGE      NUMBER      AVERAGE
   RANGE OF       OF SHARES    CONTRACTUAL    EXERCISE    OF SHARES    EXERCISE
EXERCISE PRICE   OUTSTANDING   LIFE (YEARS)    PRICE     EXERCISABLE    PRICE
--------------   -----------   ------------   --------   -----------   --------
$.045 - $ .09         259          7.01        $ 0.07         259       $ 0.07
  .25 -   .50         112          7.87          0.27         112         0.27
 2.00 -  4.60       1,448          8.96          3.34       1,448         3.34
 5.50 -  7.00         456          9.85          6.42         237         5.89
                    -----                                   -----
 .045 -  7.00       2,275                                   2,056
                    =====                                   =====

The following information concerning the Company's stock option plans is provided in accordance with SFAS No. 123. The Company accounts for such plans in accordance with APB No. 25, "Accounting for Stock Issued to Employees."

F-17

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The fair value of each option grant has been estimated on the date of grant using the minimum value method with the following weighted average assumptions used for grants:

                                             YEARS ENDED DECEMBER 31,
                                          ------------------------------
                                              1997             1998
                                          -------------    -------------
Risk-free interest rate.................  5.31% - 6.54%    5.14% - 5.94%
Expected life...........................     4 years          4 years
Dividends...............................       --               --

The weighted average fair value per option granted in 1996, 1997 and 1998 was $0.15, $1.50 and $4.94, respectively.

The following pro forma net loss and net loss per share information has been prepared as if the Company had followed the provisions of SFAS No. 123:

                                             YEARS ENDED DECEMBER 31,
                                          ------------------------------
                                           1996       1997        1998
                                          -------    -------    --------
Net loss
  As reported...........................  $(7,039)   $(6,900)   $(13,701)
  Pro forma.............................   (7,042)    (6,940)    (13,999)
Basic and diluted net loss per share
  As reported...........................    (2.67)     (2.41)      (3.47)
  Pro forma.............................    (2.67)     (2.43)      (3.54)

11. NON-PLAN STOCK OPTIONS:

During 1996, the Company granted options to purchase 268,255 shares to an officer of the Company outside of the 1995 Stock Option Plan. These options are exercisable at $.09 per share and vest at the rate of 1/48 per month over a four-year period. In addition, these options have certain accelerated vesting requirements in the event of a change of control in the Company, as defined in the option grant agreement.

At December 31, 1998 and 1997, 38,255 and 268,255 shares of Common Stock, respectively, were reserved for the exercise of non-plan stock options.

At December 31, 1998, the non-plan stock options exercised 45,575 shares are subject to repurchase.

F-18

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

The following table summarizes activity under the non-plan stock options for the years ended December 31, 1996, 1997 and 1998:

                                                                           WEIGHTED
                                                   EXERCISE    AGGREGATE   AVERAGE
                                       NUMBER OF     PRICE     EXERCISE    EXERCISE
                                        SHARES     PER SHARE     PRICE      PRICE
                                       ---------   ---------   ---------   --------
Options outstanding at January 1,
  1996...............................      --           --         --          --
  Options granted....................     268        $0.09       $ 24       $0.09
                                         ----        -----       ----       -----
Options outstanding and exercisable
  at December 31, 1996...............     268         0.09         24        0.09
                                         ----        -----       ----       -----
Options outstanding and exercisable
  at December 31, 1997...............     268         0.09         24        0.09
  Options exercised..................    (230)        0.09        (21)       0.09
                                         ----        -----       ----       -----
Options outstanding and exercisable
  at December 31, 1998...............      38        $0.09       $  3       $0.09
                                         ====        =====       ====       =====

At December 31, 1998, the remaining contractual life of these options was 7.18 years.

The Company accounts for the fair value of its non-plan stock option grants under the non-stock plan in accordance with APB 25. Accordingly, no compensation expense has been recognized for the non-plan stock options.

The fair value of the options is estimated using the minimum value option pricing method allowable for non-public companies and using the following assumptions; dividend yield of 0%, volatility of 0%, risk-free interest rate of 6.45% at the date of grant, and an expected term of four years.

12. STOCKHOLDER NOTES RECEIVABLE

Stockholder notes receivable represents amounts due from a stockholder in exchange for the issuance of Common Stock together with interest. The notes bear interest at a rate of 5.47% and are due February 1, 2001 but may be repaid earlier. The notes are collateralized by a pledge of a portion of the underlying Common Stock issued.

13. WARRANTS

In connection with equipment leasing activity under a master lease agreement with a leasing company, the Company has issued warrants to the leasing company to purchase up to 42 shares of Series A Preferred Stock at a price of $.45 per share, 61 shares of Series B Preferred Stock at a price of $.90 per share and 22 shares of Series C Preferred Stock at a price of $2.50 per share. Each warrant has a seven year life and can be exercised at any time prior to expiration, except that the warrants will immediately expire on the effective date of an initial public offering if not exercised. The estimate fair value of these warrants of $22 has been recorded as debt issuance costs.

In connection with a reseller and technology license agreement with another software company, the Company issued a warrant to purchase up to 70 shares of the Company's Common Stock. The warrant can be exercised at any time prior to expiration. The exercise

F-19

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

price will be equal to $7.20 per share. The warrant expires on December 22, 2002. The estimate fair value of the warrant of $100 has been recorded as cost of sales.

The Company issued warrants to purchase Common and Preferred Stock to establish and increase a line of credit with a financial institution. Each warrant can be exercised at any time prior to expiration. At December 31, 1998 such warrants were as follows.

                             SHARES OF   EXERCISE
                              COMMON       PRICE
                               STOCK     PER SHARE         EXPIRATION DATE
                             ---------   ---------   ---------------------------
Series D Preferred Stock...       93       $3.18     Later of July 16, 2007 or
                                                     five years after the
                                                     closing of an initial
                                                     public offering
Series E Preferred Stock...        3        5.40     Later of May 7, 2008 or
                                                     five years after the
                                                     closing of an initial
                                                     public offering
Common Stock...............        6        6.50     Later of September 30, 2008
                                                     or five years after the
                                                     closing of an initial
                                                     public offering

The estimate fair value of these warrants of $54 has been recorded as debt issuance costs. In 1998, in connection with a joint venture to conduct business in a foreign country, the Company issued a warrant to purchase 22 shares of Common Stock at a price of $5.40 per share. The warrant is immediately exercisable and expires on the later of May 21, 2003, the closing of a business combination or the closing of the Company's initial public offering. The estimate fair value of the warrant of $60 has been recorded as general and administrative expense.

The estimated fair value of these warrants have been determined based on a Black Scholes fair value model.

14. INCOME TAXES

The Company's effective tax rate differs from the U.S. Federal statutory tax rate as follows:

                                                 YEARS ENDED DECEMBER 31,
                                               -----------------------------
                                                1996       1997       1998
                                               -------    -------    -------
Tax benefit at statutory rate................  $(2,393)   $(2,346)   $(4,652)
State taxes, net of federal benefit..........       --         --       (744)
Nonrecognition of tax benefits...............    2,481      2,554      5,885
Tax credits..................................     (100)      (240)      (420)
Other........................................       12         32        (69)
                                               -------    -------    -------
                                               $    --    $    --    $    --
                                               =======    =======    =======

F-20

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

Deferred tax assets (liabilities) are comprised of the following:

                                                    AS OF DECEMBER 31,
                                                     1997        1998
                                                    -------    --------
Deferred tax assets and liabilities:
  Net operating loss carry forwards...............  $ 4,083    $  7,588
  Capitalized research and development costs......      958       1,796
  Research and development credit.................      516       1,080
  Depreciation and amortization...................       73          68
  Other...........................................      460       1,457
                                                    -------    --------
                                                      6,090      11,989
Valuation allowance...............................   (6,090)    (11,989)
                                                    -------    --------
                                                    $    --    $     --
                                                    =======    ========

Due to the uncertainty surrounding the realization of the deferred tax asset in future tax returns, the Company has placed a valuation allowance against its net deferred tax assets. The valuation allowance increased by $2,139 and $5,899 during 1997 and 1998, respectively.

The difference between the statutory rate of approximately 40% (34% federal and 6% state, net of federal benefits) and the tax benefit of zero recorded by the Company is primarily due to the Company's full valuation allowance against its net deferred tax assets.

At December 31, 1998, the Company had available net operating loss carryforwards for federal and state income tax purposes of approximately $20,775 and $17,819, respectively. These carryforwards expire from 2003 to 2018. Although a significant portion of the state net operating loss expire in 2003. At December 31, 1998, the Company also had available research and development credit carryforwards for federal and state income tax purposes of approximately $741 and $514 respectively. These carryforwards expire from 2010 to 2013.

For federal and state tax purposes, a portion of the Company's net operating loss carryforwards may be subject to certain limitation on annual utilization in case of a change in ownership, as defined by federal and state tax law.

15. EMPLOYEE BENEFIT PLANS

Sagent maintains a Profit Sharing Salary Deferral 401(k) plan for all of its employees. This plan allows eligible employees to defer up to 15%, but no greater than the stated limitation in any plan year, of their pretax compensation in certain investments at the discretion of the employee. Under the Plan, the Company is not required to and has not made a contribution to the Plan for 1996, 1997 or 1998.

Sagent Professional Services maintained a separate Profit Sharing Salary Deferral 401(k) plan for eligible employees until January 1, 1999. This Plan allowed eligible employees to defer up to 15%, but no greater than the stated limitation in any plan year, of their pretax compensation in certain investments at the discretion of the employee. Under the Plan the Company was required to make matching contributions to the Plan. The Company could elect to make additional contributions on the basis of (a) a percentage of

F-21

SAGENT TECHNOLOGY, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)

the employee deferral and (b) profit sharing. Costs related to matching contributions amounted to $0, $50 and $51 for 1996, 1997 and 1998, respectively.

Effective January 1, 1999, all employees, including those formerly covered by the Profit Sharing Salary Deferral 401(k) plan of Sagent Professional Group, will be included in the Profit Sharing Salary Deferral 401(k) plan of Sagent Technology, Inc.

16. SUBSEQUENT EVENTS

In January 1999, the Board of Directors adopted the Director Plan, subject to stockholder approval, which allows the Company to grant up to 150 shares of Common Stock to non-employee directors. The exercise price of any option granted under the Director Plan will be equal to the fair market value per share of Common Stock on the date of grant. Each option granted will have a term of ten years and the shares subject to the option will become exercisable in four equal annual installments subject to the optionee's completion of each year of Board service.

The 1999 Purchase Plan was adopted by the Board of Directors in January 1999, subject to stockholder approval, a total of 450 shares of common stock has been reserved for issuance under the 1999 Purchase Plan. The number of shares reserved will be subject to an annual increase every January equal to the lesser of the number of shares optioned during the prior year or lesser amount determined by the Board of Directors. The 1999 Purchase Plan permits eligible employees to purchase Common Stock through payroll deductions at a price equal to 85% of the lower of the fair market value of the common stock at the beginning or end of each six-month offering period.

Upon the closing of the Company's initial public offering the authorized capital stock will be 70,000 shares of Common Stock, $0.001 par value, and 5,000 shares of Preferred Stock, $0.001 par value.

F-22

TALUS, INCORPORATED

INDEX TO FINANCIAL STATEMENTS

                                                              PAGE(S)
                                                              -------
Report of Independent Accountants...........................   F-24
Balance Sheets..............................................   F-25
Statements of Operations and Retained Earnings..............   F-26
Statements of Cash Flows....................................   F-27
Notes to Financial Statements...............................   F-28

F-23

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors of Sagent Technology, Inc. and Talus, Incorporated Stockholders:

We have audited the accompanying balance sheets of Talus, Incorporated (formerly known as InCASE Corporation) as of December 31, 1996 and 1997, and the related statements of operations and retained earnings and cash flows for each of the two years in the period ended December 31, 1997. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Talus, Incorporated as of December 31, 1996 and 1997, and the results of operations and its cash flows for each of the two years in the period ended December 31, 1997 in conformity with generally accepted accounting principles.

PricewaterhouseCoopers LLP
McLean, VA
February 20, 1998

F-24

TALUS, INCORPORATED

BALANCE SHEETS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

                                                              YEARS ENDED
                                                              DECEMBER 31,
                                                              ------------
                                                              1996    1997
                                                              ----    ----
                                  ASSETS

CURRENT ASSETS:
  Cash......................................................  $ 13    $  1
  Accounts receivable, net..................................   511     361
  Prepaid expenses..........................................     7      35
                                                              ----    ----
       Total current assets.................................   531     397
  Property and equipment, net...............................   111      76
  Deposits and other noncurrent assets......................    19       8
                                                              ----    ----
       Total assets.........................................  $661    $481
                                                              ====    ====

                   LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
  Borrowings under line of credit...........................  $299    $ 90
  Note payable..............................................    --      90
  Accounts payable and accrued expenses.....................    97      63
  Accrued vacation..........................................    41      36
  Accrued retirement contributions..........................    49      50
  Due to stockholders.......................................    17      --
                                                              ----    ----
       Total current liabilities............................   503     329
     Accrued bonus to stockholders..........................   105     105
                                                              ----    ----
       Total liabilities....................................   608     434
                                                              ----    ----
     Commitments (Note 5)

STOCKHOLDERS' EQUITY
  Common Stock; par value $.01 per share; authorized 200
     shares; issued and outstanding 102 shares..............     1       1
  Additional paid-in capital................................     4       4
  Retained earnings.........................................    48      42
                                                              ----    ----
       Total stockholders' equity...........................    53      47
                                                              ----    ----
       Total liabilities and stockholders' equity...........  $661    $481
                                                              ====    ====

The accompanying notes are an integral part of these financial statements.

F-25

TALUS, INCORPORATED

STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(IN THOUSANDS)

                                                                YEARS ENDED
                                                                DECEMBER 31,
                                                              ----------------
                                                               1996      1997
                                                              ------    ------
Gross revenue...............................................  $2,667    $2,830
OPERATING EXPENSES:
     Cost of goods sold.....................................   1,238     1,178
     Sales and marketing....................................     161       140
     Research and development...............................     573       627
     General and administrative.............................     686       857
                                                              ------    ------
Operating income............................................       9        28
                                                              ------    ------
OTHER INCOME (EXPENSE):
     Interest expense.......................................     (22)      (30)
     Loss on investment.....................................      (2)       --
     Loss on disposal of property and equipment.............      --        (4)
Net loss....................................................     (15)       (6)
Retained earnings, beginning of year........................      63        48
                                                              ------    ------
Retained earnings, end of year..............................  $   48    $   42
                                                              ======    ======

The accompanying notes are an integral part of these financial statements.

F-26

TALUS, INCORPORATED

STATEMENTS OF CASH FLOWS
(IN THOUSANDS)

                                                                 YEARS ENDED
                                                                DECEMBER 31,
                                                               1996       1997
                                                              ------      -----
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net loss..................................................  $  (15)     $  (6)
  Adjustments to reconcile net losses to net cash provided
     by (used in) operating activities:
     Depreciation and amortization..........................      43         40
     Provision for doubtful accounts and writeoff of
       uncollectible accounts...............................      40         41
     Loss on sale of property and equipment.................      --          4
     Changes in operating assets and liabilities:
       Accounts receivable..................................    (176)       109
       Prepaid expenses.....................................     (10)       (28)
       Deposits.............................................     (14)        10
       Accounts payable and accrued expenses................      --        (34)
       Accrued vacation.....................................      --          1
       Accrued retirement contributions.....................       7         (4)
       Accrued stockholders bonus...........................     (45)        --
                                                              ------      -----
Net cash provided by (used in) operating activities.........    (170)       133
                                                              ------      -----
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of property and equipment.......................     (12)        (9)
  Sales of property and equipment...........................      --          1
                                                              ------      -----
Net cash used in investing activities.......................     (12)        (8)
                                                              ------      -----
CASH FLOWS FROM FINANCING ACTIVITIES:
  Borrowings under line of credit...........................   1,112        769
  Repayments on line of credit..............................    (940)      (978)
  Proceeds from issuance of stockholder note................      17         --
  Repayment of stockholder note.............................      --        (17)
  Proceeds from note payable................................      --        100
  Repayments of note payable................................      --        (11)
  Distributions to stockholders.............................      --         --
                                                              ------      -----
Net cash (used in) provided by financing activities.........     189       (137)
                                                              ------      -----
Net increase (decrease) in cash.............................       7        (12)
Cash at beginning of year...................................       6         13
                                                              ------      -----
Cash at end of year.........................................  $   13      $   1
                                                              ======      =====
Supplemental disclosure of cash flow information:
  Cash paid for interest....................................  $   21      $  30
  Write-off of investment received in exchange for
     services...............................................       2         --

The accompanying notes are an integral part of these financial statements.

F-27

TALUS, INCORPORATED

NOTES TO FINANCIAL STATEMENTS
(IN THOUSANDS)

1. DESCRIPTION OF BUSINESS

Talus, Incorporated (previously known as InCASE Corporation) was formed to provide advanced information technology services to both governmental and commercial customers. Talus, Incorporated (the "Company") was incorporated in Virginia in 1992 and is owned by two stockholders. The primary activities of the Company consist of software engineering and data warehousing consulting.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF ACCOUNTING

These financial statements have been prepared on the accrual basis of accounting in accordance with generally accepted accounting principles.

ACCOUNTS RECEIVABLE

Accounts receivable include amounts billed and unbilled costs and fees recoverable under contracts. Included in unbilled costs and fees at December 31, 1997 and 1996 are amounts currently billable in accordance with specified contract terms. Of the stated amounts, $224 and $331 were billed by December 31, 1997 and 1996, respectively.

PROPERTY AND EQUIPMENT

Property and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the respective assets as follows:

                        DESCRIPTION                           YEARS
                        -----------                           -----
Furniture and fixtures......................................    7
Software....................................................    3
Office equipment............................................    5

Expenditures for repairs and maintenance are charged to expense as incurred. The costs of major improvements are capitalized and depreciated over their estimated useful lives. The cost and related accumulated depreciation of property and equipment are removed from the accounts upon disposition and any resulting gain or loss is reflected in operations at that time.

REVENUE RECOGNITION

The Company's revenue is derived primarily from time and materials contracts. Revenue on time and material contracts is recognized based on actual hours performed at the contracted hourly rate plus the costs of any direct materials provided.

INCOME TAXES

The Company has elected to be treated as an "S" Corporation under the Internal Revenue Code. Accordingly, the income or loss of the Company is taxable to the stockholders and the Company is not liable for federal and state income taxes.

F-28

TALUS, INCORPORATED

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS)

MAJOR CUSTOMERS

During 1997 and 1996, the Company's revenue was primarily derived from three major customers, each of which contributed more than 10% of total revenues. These customers accounted for 55% and 48% of gross revenue for 1997 and 1996, respectively. As of December 31, 1997 and 1996, these customers had accounts receivable balances totalling $147 and $140, respectively.

ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

EMPLOYEE BONUSES

The Company adopted a bonus plan in 1994 which provided that 83% of the Company's income before bonuses be allocated to a bonus pool. Of this amount, 40% was allocated to employee performance, 40% to sales performance and 20% to the two stockholders of the Company. In 1994 the two stockholders earned $63 in sales performance bonuses (approximately 50% of the total sales performance bonuses) and $25 in direct stockholder bonuses, and in 1995 they earned $17 in direct stockholder bonuses. The two stockholders have agreed to defer collection of these bonuses, totaling $105, until Talus is able to operate with less debt. It is not anticipated that these bonuses will be paid during 1998.

3. ACCOUNTS RECEIVABLE

                                                             AS OF
                                                          DECEMBER 31,
                                                          ------------
                                                          1996    1997
                                                          ----    ----
Billed and unbilled receivables.........................  $537    $389
Allowance for doubtful accounts.........................   (26)    (28)
                                                          ----    ----
Accounts receivable, net................................  $511    $361
                                                          ====    ====

F-29

TALUS, INCORPORATED

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS)

4. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

                                                             AS OF
                                                          DECEMBER 31,
                                                          ------------
                                                          1996    1997
                                                          ----    ----
Furniture and fixtures..................................  $ 33    $ 23
Computers and equipment.................................   158     163
Computer software.......................................    22      27
                                                          ----    ----
                                                           213     213
Less accumulated depreciation...........................   102     137
                                                          ----    ----
Property and equipment, net.............................  $111    $ 76
                                                          ====    ====

Depreciation expense for the years ended December 31, 1997 and 1996 was $40 and $42, respectively.

5. COMMITMENTS

LEASE OBLIGATIONS

The Company leases its office space and various equipment under noncancelable operating leases with original terms in excess of the year. Future minimum payments on noncancelable operating leases were as follows at December 31, 1997:

1998....................................................  $120
1999....................................................   113
2000....................................................    85
                                                          ----
          Total.........................................  $318
                                                          ====

Rental expense was $116 and $126 for the years ended December 31, 1997 and 1996, respectively.

6. LINE OF CREDIT AND NOTE PAYABLE

In March 1995, the Company entered into a revolving credit facility agreement with maximum borrowings of $150 subject to certain borrowing base restrictions which matured on March 24, 1996. Interest was at the prime rate plus 1 1/2% per annum, (a total of 10.15% at December 31, 1995). Borrowings were collateralized by the Company's eligible accounts receivable. The Company's two principal stockholders and one other member of management were guarantors on the Loan Agreement.

In March 1996, the Company entered a credit facility agreement with maximum borrowing of $300 subject to certain borrowing base restrictions. Interest was at the prime rate plus 1 1/2% per annum, (a total of 9.75% at December 31, 1996). In April 1997, the agreement was amended to decrease the maximum borrowings to $200, amended to increase the interest rate to prime rate plus 2% per annum (a total of 10.5% at December 31, 1997), and extended through May 1998.

F-30

TALUS, INCORPORATED

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS)

In July 1997, Talus entered into a term loan agreement with the same financial institution of $100 due July 24, 2001. Interest is at the prime rate plus 2% per annum, (a total of 10.5% at December 31, 1997).

These agreements contain certain restrictive terms and covenants, the most restrictive of which requires the Company to maintain a specified liabilities to tangible net worth ratio. The Company was not in compliance with this restrictive covenant as of December 31, 1997. Accordingly, the entire balance of the note payable as of December 31, 1997 has been classified as current. Borrowings are collateralized by the Company's eligible accounts receivable. The Company's two principal stockholders and one other member of management are guarantors on the Loan Agreement.

In 1996, majority stockholders loaned the Company $17 bearing interest at 10%. The loans were repaid during 1997.

7. RETIREMENT PLAN

In 1995, the Company established a qualified salary reduction simplified employee pension plan (SARSEP) for all eligible employees. The Company was required to contribute 3% of eligible salaries to the SARSEP each year. Because of restrictions imposed by the Internal Revenue Code, the 3% contribution for the highly compensated employees could not be made to the SARSEP. Accordingly, the Company adopted a policy that any amount that could not be funded to the SARSEP due to these restrictions would be paid directly to those highly compensated employees as additional compensation. As of December 31, 1996, six employees were deemed to be highly compensated. The compensation provided for such employees was $17. The total Company contributions for 1996 for all eligible employees, as defined by the Internal Revenue Code, were $32. The SARSEP was terminated during 1997.

During 1997 the Company established a 401(k) plan for the benefit of all eligible employees. Employees may make contributions to the plan, subject to certain limitations contained in the Internal Revenue Code. The Company matches up to 50% of the first 6% of compensation deferred under the plan. Employees vest 50% in the employer contributions after one year and 100% after two years of employment at the Company. Employer contributions to the plan were $50 for the year ended December 31, 1997.

8. COMMON STOCK, ADDITIONAL PAID-IN CAPITAL AND STOCK OPTIONS

At the Company's inception in 1992, 25 shares of common stock with $.10 par value per share were authorized and 10 shares were issued. In 1996, the Articles of Incorporation were amended to authorize 200 shares of common stock with a $.01 par value per share. A stock split was effective in 1996 increasing the number of issued and outstanding shares to 102.

A stock option plan, which was adopted in 1996, provides for the granting of stock options to employees. The agreements provide the participants an option to purchase shares of the Company's stock generally based on certain time vesting requirements. On June 21, 1996, the Company granted 7 options with an exercise price of $1.00 per share.

F-31

TALUS, INCORPORATED

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
(IN THOUSANDS)

On May 31, 1997, the Company granted 11 options with an exercise price of $4.77 per share. As of December 1997, options for 7 shares are exercisable.

The effects of applying SFAS NO. 123 are immaterial as the application of SFAS NO. 123 would not result in a significant difference from reported net loss. Accordingly, the following disclosures are omitted: (1) pro forma net income, (2) weighted-average grant date fair value of options granted during the year and (3) description of method and assumptions used to estimate fair value of options.

9. SUBSEQUENT EVENTS

The Company is currently negotiating a merger agreement with Sagent Technology, Inc.

F-32

SAGENT TECHNOLOGY, INC.

PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following financial statements present the Sagent Technology, Inc. ("Sagent") Pro Forma Consolidated Statements of Operations for the year ended December 31, 1998.

The Company's acquisition of Talus, Incorporated ("Talus") has been accounted for under the "purchase" method of accounting, which requires the purchase price to be allocated to the acquired assets and liabilities of Talus on the basis of their estimated fair values as of the date of acquisition. The following pro forma consolidated statements of operations for the year ended December 31, 1998 give effect to the acquisition of Talus as if it occurred on January 1, 1998, and include adjustments directly attributable to the acquisition of Talus and expected to have a continuing impact on the combined company (collectively, the "Pro Forma Financial Statements").

The pro forma information is based on historical financial statements. The pro forma results of operations for the year ended December 31, 1998 includes the results of operations of Talus from January 1, 1998 to February 28, 1998. The assumptions give effect to the business combination with Talus under the purchase method of accounting. The information has been prepared in accordance with the rules and regulations of the Commission and is provided for comparative purposes only. The pro forma information does not purport to be indicative of the results that actually would have occurred had the combination been effected at the beginning of the periods presented.

F-33

SAGENT TECHNOLOGY, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)

(IN THOUSANDS, EXCEPT PER SHARE DATA)

                                                  FOR THE YEAR ENDED DECEMBER 31, 1998
                                            ------------------------------------------------
                                                                   PURCHASE      PRO FORMA
                                             SAGENT     TALUS     ADJUSTMENTS   CONSOLIDATED
                                            --------   --------   -----------   ------------
Total revenues, net.......................  $ 17,043   $    452    $     --       $ 17,495
Cost of revenues..........................     5,066        167        (102)         5,131
                                            --------   --------    --------       --------
Gross profit..............................    11,977        285         102         12,364
Sales and marketing.......................    12,037        383                     12,420
Research and development..................     6,013        283                      6,296
General and administrative................     5,186        342                      5,528
Acquired in-process technology............     2,425                 (2,425)            --
                                            --------   --------    --------       --------
          Total operating expense.........    25,661      1,008      (2,425)        24,244
                                            --------   --------    --------       --------
Loss from operations......................   (13,684)      (723)     (2,527)       (11,880)
Interest expense..........................      (207)                                 (207)
Other income..............................       190                                   190
                                            --------   --------    --------       --------
          Net loss........................  $(13,701)  $   (723)   $ (2,527)      $(11,897)
                                            ========   ========    ========       ========
Pro forma net loss per share..............  $  (0.74)                             $   (.64)
                                            ========                              ========
Weighted average shares used in
  computation of pro forma net loss per
  share...................................    18,495                                18,495
                                            ========                              ========

See accompanying notes.

F-34

SAGENT TECHNOLOGY, INC.

NOTES TO PRO FORMA
CONSOLIDATED FINANCIAL STATEMENTS
(IN THOUSANDS)

1. BASIS OF PRESENTATION

On February 28, 1998, the Company acquired Talus, a privately held consulting company that has experience in the design and implementation of enterprise intelligence applications.

The unaudited pro forma information presented is not necessarily indicative of future consolidated results of operations of Sagent or the consolidated results of operations that would have resulted had the acquisition taken place on January 1, 1998. The unaudited pro forma consolidated statements of operations for the year ended December 31, 1998 reflect the effects of the acquisition, assuming the related events occurred as of January 1, 1998 for the purposes of the unaudited pro forma consolidated statements of operations.

2. UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL ADJUSTMENTS

The unaudited pro forma consolidated financial statements reflect a total purchase price of $3.5 million, and the acquisition was recorded under the purchase method of accounting. In connection with the acquisition, the Company expensed $2.4 million of in-process technology in the quarter ended March 31, 1998. In addition, the Company recorded other intangibles of $587, which are being amortized on a straight-line basis over six months to three years following the acquisition. The determination of the acquired in-process technology allocation was based upon recently issued guidance issued by the Securities and Exchange Commission ("SEC") and considered such factors as degree of completion, technological uncertainties, costs incurred and projected costs to complete. In-process technology charges have not been reflected in the pro forma consolidated financial statements of operations for the year ended December 31, 1998 as they are considered a non-recurring charge.

3. UNAUDITED PRO FORMA CONSOLIDATED NET LOSS PER SHARE

The net loss per share and shares used in computing the net loss per share for the year ended December 31, 1998 is based upon the historical weighted average common shares outstanding. The Sagent Common Stock issuable upon the exercise of the stock options and warrants have been excluded as the effect would be antidilutive. In addition to the shares used in computing the net loss per share above, pro forma net loss per share is calculated using the Convertible Preferred Stock outstanding as if such shares were converted to Common Stock at the time of issuance.

4. PURCHASE ADJUSTMENTS

Pro forma adjustments have been prepared to reflect the elimination of the non-recurring one-time charge for acquired in-process technology and to reflect the amortization of capitalized technology and other intangible assets.

F-35

SCHEDULE II

SAGENT TECHNOLOGY, INC.

VALUATION AND QUALIFYING ACCOUNTS
(IN THOUSANDS)

                                                  ADDITIONS
                                   BALANCE AT    (REDUCTIONS)                  BALANCE AT
                                   BEGINNING       IN COSTS                      END OF
                                   OF PERIOD     AND EXPENSES    WRITE-OFFS      PERIOD
                                   ----------    ------------    ----------    ----------
Allowance for doubtful accounts:
     Year ended December 31,
                           1996..    $   --         $   --           $--        $    --
                           1997..        --            450           --             450
                           1998..       450             58           --             508
Valuation allowances for deferred
  tax assets:
     Year ended December 31,
                           1996..    $   --         $3,351           $--        $ 3,351
                           1997..     3,351          2,739           --           6,090
                           1998..     6,090          5,899           --          11,989


REPORT OF INDEPENDENT ACCOUNTS ON
FINANCIAL STATEMENT SCHEDULE

To the Stockholders and Board of Directors of Sagent Technology, Inc.:

In connection with our audits of the consolidated financial statements of Sagent Technology, Inc. as of December 31, 1997 and 1998, and for each of the three years in the period ended December 31, 1998, which financial statements are included in the Prospectus, we have also audited the financial statement schedule listed in Item 16(b) herein. In our opinion, this financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information required to be included therein.

/s/ PRICEWATERHOUSECOOPERS LLP
San Jose, California
January 27, 1999

F-37



, 1999

LOGO

SHARES OF COMMON STOCK


PROSPECTUS

DONALDSON, LUFKIN & JENRETTE
HAMBRECHT & QUIST
PIPER JAFFRAY INC.

DLJDIRECT INC.


WE HAVE NOT AUTHORIZED ANY DEALER, SALESPERSON OR OTHER PERSON TO GIVE YOU WRITTEN INFORMATION OTHER THAN THIS PROSPECTUS OR TO MAKE REPRESENTATIONS AS TO MATTERS NOT STATED IN THIS PROSPECTUS. YOU MUST NOT RELY ON UNAUTHORIZED INFORMATION. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES OR OUR SOLICITATION OF YOUR OFFER TO BUY THE SECURITIES IN ANY JURISDICTION WHERE THAT WOULD NOT BE PERMITTED OR LEGAL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALES MADE HEREUNDER AFTER THE DATE OF THIS PROSPECTUS SHALL CREATE AN IMPLICATION THAT THE INFORMATION CONTAINED HEREIN OR THE AFFAIRS OF THE COMPANY HAVE NOT CHANGED SINCE THE DATE HEREOF.


UNTIL , 1999 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS), ALL DEALERS THAT EFFECT TRANSACTIONS IN THESE SHARES OF COMMON STOCK MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS IS IN ADDITION TO THE DEALER'S OBLIGATION TO DELIVER A PROSPECTUS WHEN ACTING AS AN UNDERWRITER AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.




PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth the costs and expenses, other than underwriting discounts and commissions, payable by the Registrant in connection with the sale of Common Stock being registered. All amounts are estimates except the registration fee and the NASD filing fee.

                                                              AMOUNT
                                                               TO BE
                                                               PAID
                                                              -------
Registration Fee............................................  $11,120
NASD Fee....................................................    5,100
Nasdaq Listing Fee..........................................        *
Legal Fees and Expenses.....................................        *
Accounting Fees and Expenses................................        *
Blue Sky Fees and Expenses..................................        *
Transfer Agent Fees.........................................        *
Miscellaneous...............................................        *
                                                              -------
          Total.............................................  $     *
                                                              =======


* To be filed by amendment.

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

As permitted by Section 145 of the Delaware General Corporation Law, the Registrant's Certificate of Incorporation includes a provision that eliminates the personal liability of its directors for monetary damages for breach or alleged breach of their duty of care. In addition, as permitted by Section 145 of the Delaware General Corporation Law, the Bylaws of the Registrant provide that: (1) the Registrant is required to indemnify its directors and executive officers and persons serving in such capacities in other business enterprises (including, for example, subsidiaries of the Registrant) at the Registrant's request to the fullest extent permitted by Delaware law, including in those circumstances in which indemnification would otherwise be discretionary; (2) the Registrant may, in its discretion, indemnify employees and agents in those circumstances where indemnification is not required by law; (3) the Registrant is required to advance expenses, as incurred, to its directors and executive officers in connection with defending a proceeding (except that it is not required to advance expenses to a person against whom the Registrant brings a claim for breach of the duty of loyalty, failure to act in good faith, intentional misconduct, knowing violation of law or deriving an improper personal benefit; (4) the rights conferred in the Bylaws are not exclusive, and the Registrant is authorized to enter into indemnification agreements with its directors, executive officers and employees; and (5) the Registrant may not retroactively amend the Bylaw provisions in a way that it adverse to such directors, executive officers and employees in these matters.

The Registrant's policy is to enter into indemnification agreements with each of its directors and executive officers that provide the maximum indemnity allowed to directors and executive officers by Section 145 of the Delaware General Corporation Law and the

II-1


Bylaws, as well as certain additional procedural protections. In addition, such indemnification agreements provide that the Registrant directors and executive officers will be indemnified to the fullest possible extent not prohibited by law against all expenses (including attorney's fees) and settlement amounts paid or incurred by them in any action or proceeding, including any derivative action by or in the right of the Registrant, on account of their services as directors or executive officers of the Registrant or as directors or officers of any other company or enterprise when they are serving in such capacities at the request of the Registrant. The Registrant will not be obligated pursuant to the indemnification agreements to indemnify or advance expenses to an indemnified party with respect to proceedings or claims initiated by the indemnified party and not by way of defense, except with respect to proceedings specifically authorized by the Company's Board of Directors (the "Board") or brought to enforce a right to indemnification under the indemnification agreement, the Registrant's Bylaws or any statute or law. Under the agreements, the Registrant is not obligated to indemnify the indemnified party (1) for any expenses incurred by the indemnified party with respect to any proceeding instituted by the indemnified party to enforce or interpret the agreement, if a court of competent jurisdiction determines that each of the material assertions made by the indemnified party in such proceeding was not made in good faith or was frivolous; (2) for any amounts paid in settlement of a proceedings unless the Registrant consents to such settlement; (3) with respect to any proceeding brought by the Registrant against the indemnified party for willful misconduct, unless a court determines that each of such claims was not made in good faith or was frivolous; (4) on account of any suit in which judgment is rendered against the indemnified party for an accounting of profits made from the purchase or sale by the indemnified party of securities of the Registrant pursuant to the provisions of sec.16(b) of the Securities Exchange Act of 1934 and related laws;
(5) on account of conduct by the indemnified party that is finally adjudged to have been knowingly fraudulent or deliberately dishonest, or to constitute willful misconduct or a knowing violation of the law; (6) on account of any conduct from which the indemnified party derived an improper personal benefit;
(7) on account of conduct the indemnified party believed to be contrary to the best interests of the Registrant or its stockholders; (8) on account of conduct that constituted a breach of the indemnified party's duty of loyalty to the Registrant or its stockholders; or (9) if a final decision by a court having jurisdiction in the matter determines that such indemnification is not lawful.

The indemnification provision in the Bylaws and the indemnification agreements entered into between the Registrant and its directors and executive officers may be sufficiently broad to permit indemnification of the Registrant's officers and directors for liabilities arising under the Securities Act of 1933 (the "Securities Act").

II-2


Reference is made to the following documents filed as exhibits to this Registration Statement regarding relevant indemnification provisions described above and elsewhere herein:

                                                              EXHIBIT
                          DOCUMENT                            NUMBER
                          --------                            -------
Form of Underwriting Agreement..............................    1.1
Certificate of Incorporation of Registrant, as amended......    3.1
Form of Amended and Restated Certificate of Incorporation of
  Registrant, to be filed prior to closing of the
  offering..................................................    3.2
Bylaws of Registrant........................................    3.3
Form of Indemnification Agreement entered into by the
  Registrant with each of its directors and executive
  officers..................................................   10.1

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

Since January 1, 1996, the Registrant has issued and sold the following securities:

(a) From January 1, 1996 to December 31, 1998, the Registrant sold in the aggregate of 1,444,443 shares of unregistered Common Stock to 55 directors, officers, employees, former employees and consultants at prices ranging from $0.045 to $5.50 per share, for aggregate cash consideration of $805,831. Such shares were sold pursuant to the exercise of options granted by the Board. As to each director, officer, employee, former employee and consultant of the Registrant who was issued such securities, the Registrant relied upon Rule 701 of the Securities Act. Each such person purchased securities of the Registrant pursuant to a written contract between such person and the Registrant. In addition, the Registrant met the conditions imposed under Rule 701(b).

(b) On January 17, 1996 and February 25, 1997, the Registrant sold in the aggregate 92,500 shares of unregistered Common Stock at a price per share of $0.09 to a director and a price per share of $0.25 to a group of investors, respectively, for aggregate cash consideration of $21,125. These shares were sold pursuant to restricted stock purchase agreements between the Registrant and the director and such stockholders. As to each person issued such securities, the Registrant relied upon Section 4(2) of the Securities Act.

(c) In July, August and September 1996, the Registrant sold in the aggregate 2,615,680 shares of unregistered Series C Preferred Stock at a price per share of $2.50 to certain investors for aggregate cash consideration of $6,539,200. The Registrant relied upon Section 4(2) of the Securities Act and Regulation D, Rule 506, thereunder in connection with the sale of these shares. The sale of Series C Preferred Stock was made in compliance with all of the terms of Rules 501 and 502 of Regulation D, there were no more than 35 investors (as calculated pursuant to Rule 501(e) of Regulation D), and each investor who was not an accredited investor represented to the Registrant that he or she had such knowledge and experience in financial and business matters that he or she was capable of evaluating the merits and risks of the investment.

(d) On March 17, 1997, the Registrant issued and sold in the aggregate 40,000 shares of unregistered Series C Preferred Stock at a price per share of $2.50 to a director for aggregate cash consideration of $100,000. These shares were sold pursuant to a

II-3


Series C Preferred Stock Purchase Agreement between the Registrant and the director. Such issuance was made in reliance upon Section 4(2) of the Securities Act. The Registrant repurchased the shares at a price per share of $2.50 in April 1998.

(e) On June 16, 1997, the Registrant issued and sold in the aggregate 39,178 shares of unregistered Series C Preferred Stock at a price per share of $2.50 to a consultant for aggregate cash consideration of $97,945. These shares were sold pursuant to a Series C Preferred Stock Purchase Agreement between the Registrant and the consultant. Such issuance was made in reliance upon Section 4(2) of the Securities Act.

(f) In August and September 1997, the Registrant sold in the aggregate 1,572,327 shares of unregistered Series D Preferred Stock at a price per share of $3.18 to certain investors for aggregate cash consideration of $5,000,000. The Registrant relied upon Section 4(2) of the Securities Act and Regulation D, Rule 506, thereunder in connection with the sale of these shares. The sale of Series D Preferred Stock was made in compliance with all of the terms of Rules 501 and 502 of Regulation D, there were no more than 35 investors (as calculated pursuant to Rule 501(e) of Regulation D), and each investor who was not an accredited investor represented to the Registrant that he or she had such knowledge and experience in financial and business matters that he or she was capable of evaluating the merits and risks of the investment.

(g) In January 1998, the Registrant sold in the aggregate 45,785 shares of unregistered Series D Preferred Stock at a price per share of $3.18 to an officer of the Registrant for aggregate cash consideration of $145,596. These shares were sold pursuant to a Series D Preferred Stock Purchase Agreement between the Registrant and the officer. Such issuance was made in reliance upon Section 4(2) of the Securities Act.

(h) In February and March 1998, the Registrant sold in the aggregate 1,895,370 shares of unregistered Series E Preferred Stock at a price per share of $5.40 to certain investors for aggregate cash consideration of $10,234,998. The Registrant relied upon Section 4(2) of the 1933 act and Regulation D, Rule 506, thereunder in connection with the sale of these shares. The sale of Series E Preferred Stock was made in compliance with all of the terms of Rules 501 and 502 of Regulation D, there were no more than 35 investors (as calculated pursuant to Rule 501(e) of Regulation D), and each investor who was not an accredited investor represented to the Registrant that he or she had such knowledge and experience in financial and business matters that he or she was capable of evaluating the merits and risks of the investment.

(i) On May 21, 1998, the Registrant sold in the aggregate 28,000 shares of unregistered Common Stock at a price per share of $4.32 to a distributor of the Registrant's products for aggregate cash consideration of $120,960. These shares were sold pursuant to a stock purchase agreement between the Registrant and the distributor. Such issuance was made in reliance upon
Section 4(2) of the Securities Act.

(j) On September 14, 1998, the Registrant sold in the aggregate 10,000 shares of unregistered Common Stock at a price per share of $5.50 to a consultant for aggregate cash consideration of $55,000. These shares were sold pursuant to a stock purchase agreement between the Registrant and the consultant. Such issuance was made in reliance upon Section 4(2) of the Securities Act.

II-4


Appropriate legends were affixed to the share certificates issued in the transactions described above. All recipients had adequate access, through their relationships with the Registrant, to information about the Registrant.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) EXHIBITS

EXHIBIT
NUMBER                            DESCRIPTION
-------                           -----------
 1.1      Form of Underwriting Agreement.
 3.1      Certificate of Incorporation of Registrant.
 3.2*     Form of Amended and Restated Certificate of Incorporation of
          Registrant to be filed prior to the closing of the offering
          made under the Registration Statement.
 3.3      Bylaws of Registrant.
 4.1*     Form of Registrant's Common Stock Certificate.
 4.2      Sixth Amended and Restated Registration Rights Agreement,
          dated as of February 24, 1998, between the Registrant and
          the parties named therein.
 4.3      Common Stock Registration Rights Agreement, dated as of
          September 14, 1998, between the Registrant and Robert Hawk.
 5.1*     Opinion of Wilson Sonsini Goodrich & Rosati, Professional
          Corporation.
10.1      Form of Indemnification Agreement entered into by Registrant
          with each of its directors and executive officers.
10.2      Amended and Restated 1995 Stock Plan and related agreements.
10.3      1998 Stock Plan and related agreements.
10.4      1999 Employee Stock Purchase Plan and related agreements.
10.5      1999 Director Option Plan and related agreements.
10.6      Master Equipment Lease Agreement, dated August 7, 1995,
          between the Registrant and Lighthouse Capital Partners, L.P.
10.7      Master Lease Agreement, dated as of September 26, 1998,
          between the Registrant and Dell Financial Services L.P.
10.8      Loan and Security Agreement, dated as of July 16, 1997,
          between the Registrant and Venture Banking Group, a division
          of Cupertino National Bank, and amendments thereto.
10.9      Standard Office Lease, dated June 1, 1998, by and between
          the Registrant and Asset Growth Partners, Ltd., and the
          First Amendment thereto.
10.10**   Development and Licensing Agreement, dated January 22, 1997,
          between the Registrant and Abacus Concepts, Inc.
10.11**   Microsoft License and Distribution Agreement, dated August
          23, 1996, between the Registrant and Microsoft Corporation.
10.12**   Value-Added Reseller Agreement, effective June 26, 1997,
          between the Registrant and Automatic Data Processing, Inc.
10.13**   Sagent KK Non-Exclusive Japanese Distribution Agreement,
          dated as of December 17, 1997, between Sagent KK Japan and
          Kawasaki Steel Systems R&D Corporation.
10.14**   Exclusive Distribution Agreement, effective as of January 1,
          1998, by and between the Registrant and Sagent U.K. Ltd.
10.15**   Joint Venture Agreement, entered into as of April 8, 1998,
          between the Registrant and ISAR-Vermogensverwaltung GbR mbH
          and related agreements.

II-5


EXHIBIT
NUMBER                            DESCRIPTION
-------                           -----------
10.16**   Exclusive Concession Agreement, effective as of November 21,
          1997, by and between the Registrant and Sagent France S.A.
10.17**   Value-Added Reseller/OEM Agreement, effective December 30,
          1997, between the Registrant and Advent Software, Inc.
10.18     Form of Sagent Technology, Inc. End User Software License
          Agreement.
10.19**   OEM Software License Agreement, effective March 31, 1998,
          between the Registrant and Siebel Systems, Inc.
10.20     Form of Sagent Technology, Inc. Software Maintenance and
          Technical Support Agreement.
10.21     Form of Sagent Technology, Inc. Agreement for Consulting
          Services.
10.22     Form of Sagent Technology, Inc. Agreement for Subcontractor
          Consulting Services.
10.23     Form of Evaluation Agreement.
10.24     Note, dated February 1, 1998, of W. Virginia Walker.
10.25     Note, dated February 1, 1998, of W. Virginia Walker.
10.26**   Solution Provider Agreement, effective June 27, 1997,
          between the Registrant and Unisys Corporation.
10.27     Consulting Agreement, dated as of April 7, 1997, between the
          Registrant and Ralph Kimball.
10.28     Executive Change of Control Policy.
10.29     Agreement and Plan of Reorganization, dated as of February
          27, 1998, by and among Sagent Technology, Inc., Talus
          Acquisition Corp., Talus, Incorporated and Certain
          Shareholders of Talus, Inc.
10.30     Employment and Non-Competition Agreement, dated as of
          February 27, 1998, between the Registrant and Michael P.
          Venerable.
10.31**   Software License and Services Agreement, dated March 31,
          1998, between the Registrant and Siebel Systems, Inc.
21.1      Subsidiaries of the Registrant.
23.1*     Consent of Wilson Sonsini Goodrich & Rosati, Professional
          Corporation (included in Exhibit 5.1).
23.2      Consent of PricewaterhouseCoopers LLP, Independent
          Accountants.
23.3      Consent of PricewaterhouseCoopers LLP, Independent
          Accountants.
23.4*     Consent of Klaus S. Luft.
24.1      Power of Attorney (See page II-8).
27.1      Financial Data Schedule (available in EDGAR format only).


* To be supplied by amendment.

** Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission.

(b) FINANCIAL STATEMENT SCHEDULES

Schedule II. Valuation and Qualifying Accounts

Schedules not listed above have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto.

II-6


ITEM 17. UNDERTAKINGS

The undersigned hereby undertakes to provide to the Underwriters at the closing specified in the Underwriting Agreement, certificates in such denominations and registered in such names as required by the Underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the provisions referenced in Item 14 of this Registration Statement or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered hereunder, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective.

(2) For the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-7


SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this registration statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Mountain View, State of California, on this 28th day of January 1999.

SAGENT TECHNOLOGY, INC.

By: /s/ KENNETH C. GARDNER
   -----------------------------------
    Kenneth C. Gardner
    President and Chief Executive
    Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS that each person whose signature appears below constitutes and appoints, jointly and severally, Kenneth C. Gardner and W. Virginia Walker and each one of them, his true and lawful attorney-in-fact and agents, each with full power of substitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, and any registration statement related to the offering contemplated by this registration statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933 and to file the same, with all exhibits thereto and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that each of said attorneys-in-fact and agents or any of them, or his or their substitute or substitutes, may lawfully do or cause to be done or by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

                 SIGNATURES                               TITLE                    DATE
                 ----------                               -----                    ----
/s/ KENNETH C. GARDNER                         President and Chief           January 28, 1999
---------------------------------------------  Executive Officer (Principal
   Kenneth C. Gardner                          Executive Officer)

/s/ W. VIRGINIA WALKER                         Vice President of Finance     January 28, 1999
---------------------------------------------  and Administration, Chief
   W. Virginia Walker                          Financial Officer (Principal
                                               Financial and Accounting
                                               Officer)

/s/ JOHN E. ZICKER                             Director                      January 28, 1999
---------------------------------------------
   John E. Zicker

/s/ SHANDA BAHLES                              Director                      January 28, 1999
---------------------------------------------
   Shanda Bahles

II-8


                 SIGNATURES                               TITLE                    DATE
                 ----------                               -----                    ----
/s/ RICHARD W. SHAPERO                         Director                      January 28, 1999
---------------------------------------------
   Richard W. Shapero

/s/ JEFFREY T. WEBBER                          Director                      January 28, 1999
---------------------------------------------
   Jeffrey T. Webber

II-9


EXHIBIT INDEX

EXHIBIT
NUMBER                             DESCRIPTION
-------                            -----------
     1.1   Form of Underwriting Agreement.
     3.1   Certificate of Incorporation of Registrant.
     3.2*  Form of Amended and Restated Certificate of Incorporation of
           Registrant to be filed upon the closing of the offering made
           under the Registration Statement.
     3.3   Bylaws of Registrant.
     4.1*  Form of Registrant's Common Stock Certificate.
     4.2   Sixth Amended and Restated Registration Rights Agreement,
           dated as of February 24, 1998, between the Registrant and
           the parties named therein.
     4.3   Common Stock Registration Rights Agreement, dated as of
           September 14, 1998, between the Registrant and Robert Hawk.
     5.1*  Opinion of Wilson Sonsini Goodrich & Rosati, Professional
           Corporation.
    10.1   Form of Indemnification Agreement entered into by Registrant
           with each of its directors and executive officers.
    10.2   Amended and Restated 1995 Stock Plan and related agreements.
    10.3   1998 Stock Plan and related agreements.
    10.4   1999 Employee Stock Purchase Plan and related agreements.
    10.5   1999 Director Option Plan and related agreements.
    10.6   Master Equipment Lease Agreement, dated August 7, 1995,
           between the Registrant and Lighthouse Capital Partners, L.P.
    10.7   Master Lease Agreement, dated as of September 26, 1998,
           between the Registrant and Dell Financial Services L.P.
    10.8   Loan and Security Agreement, dated as of July 16, 1997,
           between the Registrant and Venture Banking Group, a division
           of Cupertino National Bank, and amendments thereto.
    10.9   Standard Office Lease, dated June 1, 1998, by and between
           the Registrant and Asset Growth Partners, Ltd., and the
           First Amendment thereto.
    10.10** Development and Licensing Agreement, dated January 22, 1997,
           between the Registrant and Abacus Concepts, Inc.
    10.11** Microsoft License and Distribution Agreement, dated August
           23, 1996, between the Registrant and Microsoft Corporation.
    10.12** Value-Added Reseller Agreement, effective June 26, 1997,
           between the Registrant and Automatic Data Processing, Inc.
    10.13** Sagent KK Non-Exclusive Japanese Distribution Agreement,
           dated as of December 17, 1997, between Sagent KK Japan and
           Kawasaki Steel Systems R&D Corporation.
    10.14** Exclusive Distribution Agreement, effective as of January 1,
           1998, by and between the Registrant and Sagent U.K. Ltd.
    10.15** Joint Venture Agreement, entered into as of April 8, 1998,
           between the Registrant and ISAR- Vermongensverwaltung GbR
           mbH and related agreements.
    10.16** Exclusive Concession Agreement, effective as of November 21,
           1997, by and between the Registrant and Sagent France S.A.
    10.17** Value-Added Reseller/OEM Agreement, effective December 30,
           1997, between the Registrant and Advent Software, Inc.
    10.18  Form of Sagent Technology, Inc. End User Software License
           Agreement.


EXHIBIT
NUMBER                             DESCRIPTION
-------                            -----------
    10.19** OEM Software License Agreement, effective March 31, 1998,
           between the Registrant and Siebel Systems, Inc.
    10.20  Form of Sagent Technology, Inc. Software Maintenance and
           Technical Support Agreement.
    10.21  Form of Sagent Technology, Inc. Agreement for Consulting
           Services.
    10.22  Form of Sagent Technology, Inc. Agreement for Subcontractor
           Consulting Services.
    10.23  Form of Evaluation Agreement.
    10.24  Note, dated February 1, 1998, of W. Virginia Walker.
    10.25  Note, dated February 1, 1998, of W. Virginia Walker.
    10.26** Solution Provider Agreement, effective June 27, 1997,
           between the Registrant and Unisys Corporation.
    10.27  Consulting Agreement, dated as of April 7, 1997, between the
           Registrant and Ralph Kimball.
    10.28  Executive Change of Control Policy.
    10.29  Agreement and Plan Reorganization, dated as of February 27,
           1998, by and among Sagent Technology, Inc., Talus
           Acquisition Corp., Talus, Incorporated and Certain
           Shareholders of Talus, Inc.
    10.30  Employment and Non-Competition Agreement, dated as of
           February 27, 1998 between Registrant and Michael P.
           Venerable.
    10.31** Software License and Services Agreement, dated March 31,
           1998, between Registrant and Siebel Systems, Inc.
    21.1   Subsidiaries of the Registrant.
    23.1*  Consent of Wilson Sonsini Goodrich & Rosati, Professional
           Corporation (included in Exhibit 5.1).
    23.2   Consent of PricewaterhouseCoopers LLP, Independent
           Accountants.
    23.3   Consent of PricewaterhouseCoopers LLP, Independent
           Accountants.
    23.4*  Consent of Klaus S. Luft.
    24.1   Power of Attorney (See page II-8).
    27.1   Financial Data Schedule (available in EDGAR format only).


* To be supplied by amendment.

** Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities

and Exchange Commission.


EXHIBIT 1.1
__________ Shares

SAGENT TECHNOLOGY, INC.

Common Stock

UNDERWRITING AGREEMENT

__________, 1999

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
HAMBRECHT & QUIST LLC
PIPER JAFFRAY INC.
As representatives of the several Underwriters named in Schedule I hereto
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, New York 10172

Dear Sirs:

Sagent Technology, Inc., a Delaware corporation (the "COMPANY"), proposes to issue and sell ____________ shares of its Common Stock, par value $0.001 per share (the "FIRM SHARES"), to the several underwriters named in Schedule I hereto (the "UNDERWRITERS"). The Company also proposes to issue and sell to the several Underwriters not more than an additional _______ shares of its Common Stock, par value $0.001 per share (the "ADDITIONAL SHARES"), if requested by the Underwriters as provided in Section 2 hereof. The Firm Shares and the Additional Shares are hereinafter referred to collectively as the "SHARES." The shares of common stock of the Company to be outstanding after giving effect to the sales contemplated hereby are hereinafter referred to as the "COMMON STOCK."

SECTION 1. Registration Statement and Prospectus. The Company has prepared and filed with the Securities and Exchange Commission (the "COMMISSION") in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the "ACT"), a registration statement on Form S-1, including a prospectus, relating to the Shares. The registration statement, as amended at the time it became effective, including the information (if any) deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430A under the Act, is hereinafter referred to as the "REGISTRATION STATEMENT"; and the prospectus in the form first used to confirm sales of Shares is hereinafter referred to as the "PROSPECTUS." If the Company has filed or is required pursuant to the terms hereof to file a registration statement pursuant to Rule 462(b) under the Act registering


additional shares of Common Stock (a "RULE 462(B) REGISTRATION STATEMENT"), then, unless otherwise specified, any reference herein to the term "Registration Statement" shall be deemed to include such Rule 462(b) Registration Statement.

SECTION 2. Agreements to Sell and Purchase and Lock-Up Agreements. On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to issue and sell, and each Underwriter agrees, severally and not jointly, to purchase from the Company at a price per Share of $______ (the "PURCHASE PRICE") the number of Firm Shares set forth opposite the name of such Underwriter in Schedule I hereto.

On the basis of the representations and warranties contained in this Agreement, and subject to its terms and conditions, the Company agrees to issue and sell the Additional Shares and the Underwriters shall have the right to purchase, severally and not jointly, up to _______ Additional Shares from the Company at the Purchase Price. Additional Shares may be purchased solely for the purpose of covering over-allotments made in connection with the offering of the Firm Shares. The Underwriters may exercise their right to purchase Additional Shares in whole or in part from time to time by giving written notice thereof to the Company within 30 days after the date of this Agreement. You shall give any such notice on behalf of the Underwriters and such notice shall specify the aggregate number of Additional Shares to be purchased pursuant to such exercise and the date for payment and delivery thereof, which date shall be a business day (i) no earlier than two business days after such notice has been given (and, in any event, no earlier than the Closing Date (as hereinafter defined)) and
(ii) no later than ten business days after such notice has been given. If any Additional Shares are to be purchased, each Underwriter, severally and not jointly, agrees to purchase from the Company the number of Additional Shares (subject to such adjustments to eliminate fractional shares as you may determine) which bears the same proportion to the total number of Additional Shares to be purchased from the Company as the number of Firm Shares set forth opposite the name of such Underwriter in Schedule I bears to the total number of Firm Shares.

The Company hereby agrees not to (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or (ii) enter into any swap or other arrangement that transfers all or a portion of the economic consequences associated with the ownership of any Common Stock (regardless of whether any of the transactions described in clause
(i) or (ii) is to be settled by the delivery of Common Stock, or such other securities, in cash or otherwise), except to the Underwriters pursuant to this Agreement, for a period of 180 days after the date of the Prospectus without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation. Notwithstanding the foregoing, during such period (i) the Company may grant stock options pursuant to the Company's existing stock option plan and (ii) the Company may issue shares of Common Stock upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof. The Company also agrees not to file any registration statement with respect to any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock for a period of 180 days after the date of the Prospectus without the prior written consent

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of Donaldson, Lufkin & Jenrette Securities Corporation. The Company shall, prior to or concurrently with the execution of this Agreement, deliver an agreement executed by (i) each of the directors and officers of the Company and (ii) each holder of greater than 0.5% of the Company's outstanding capital stock to the effect that such person will not, during the period commencing on the date such person signs such agreement and ending 180 days after the date of the Prospectus, without the prior written consent of Donaldson, Lufkin & Jenrette Securities Corporation, (A) engage in any of the transactions described in the first sentence of this paragraph or (B) make any demand for, or exercise any right with respect to, the registration of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock.

SECTION 3. Terms of Public Offering. The Company is advised by you that the Underwriters propose (i) to make a public offering of their respective portions of the Shares as soon after the execution and delivery of this Agreement as in your judgment is advisable and (ii) initially to offer the Shares upon the terms set forth in the Prospectus.

SECTION 4. Delivery and Payment. The Shares shall be represented by definitive certificates and shall be issued in such authorized denominations and registered in such names as Donaldson, Lufkin & Jenrette Securities Corporation shall request no later than two business days prior to the Closing Date or the applicable Option Closing Date (as defined below), as the case may be. The Company shall deliver the Shares, with any transfer taxes thereon duly paid by the respective Sellers, to Donaldson, Lufkin & Jenrette Securities Corporation through the facilities of The Depository Trust Company ("DTC"), for the respective accounts of the several Underwriters, against payment to the Company of the Purchase Price therefore by wire transfer of Federal or other funds immediately available in New York City. The certificates representing the Shares shall be made available for inspection not later than 9:30 A.M., New York City time, on the business day prior to the Closing Date or the applicable Option Closing Date, as the case may be, at the office of DTC or its designated custodian (the "DESIGNATED OFFICE"). The time and date of delivery and payment for the Firm Shares shall be 9:00 A.M., New York City time, on ________, 1999 or such other time on the same or such other date as Donaldson, Lufkin & Jenrette Securities Corporation and the Company shall agree in writing. The time and date of delivery and payment for the Firm Shares are hereinafter referred to as the "CLOSING DATE." The time and date of delivery and payment for any Additional Shares to be purchased by the Underwriters shall be 9:00 A.M., New York City time, on the date specified in the applicable exercise notice given by you pursuant to Section 2 or such other time on the same or such other date as Donaldson, Lufkin & Jenrette Securities Corporation and the Company shall agree in writing. The time and date of delivery for any Additional Shares are hereinafter referred to as the "OPTION CLOSING DATE."

The documents to be delivered on the Closing Date or any Option Closing Date on behalf of the parties hereto pursuant to Section 8 of this Agreement shall be delivered at the offices of Brobeck, Phleger & Harrison LLP, Two Embarcadero Place, 2200 Geng Road, Palo Alto, CA 94303 and the Shares shall be delivered at the Designated Office, all on the Closing Date or such Option Closing Date, as the case may be.

SECTION 5. Agreements of the Company. The Company agrees with you:

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(a) To advise you promptly and, if requested by you, to confirm such advice in writing, (i) of any request by the Commission for amendments to the Registration Statement or amendments or supplements to the Prospectus or for additional information, (ii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of the suspension of qualification of the Shares for offering or sale in any jurisdiction, or the initiation of any proceeding for such purposes, (iii) when any amendment to the Registration Statement becomes effective, (iv) if the Company is required to file a Rule 462(b) Registration Statement after the effectiveness of this Agreement, when the Rule 462(b) Registration Statement has become effective and (v) of the happening of any event during the period referred to in Section 5(d) below which makes any statement of a material fact made in the Registration Statement or the Prospectus untrue or which requires any additions to or changes in the Registration Statement or the Prospectus in order to make the statements therein not misleading. If at any time the Commission shall issue any stop order suspending the effectiveness of the Registration Statement, the Company will use its best efforts to obtain the withdrawal or lifting of such order at the earliest possible time.

(b) To furnish to you four (4) signed copies of the Registration Statement as first filed with the Commission and of each amendment to it, including all exhibits, and to furnish to you and each Underwriter designated by you such number of conformed copies of the Registration Statement as so filed and of each amendment to it, without exhibits, as you may reasonably request.

(c) To prepare the Prospectus, the form and substance of which shall be satisfactory to you, and to file the Prospectus in such form with the Commission within the applicable period specified in Rule 424(b) under the Act; during the period specified in Section 5(d) below, not to file any further amendment to the Registration Statement and not to make any amendment or supplement to the Prospectus of which you shall not previously have been advised or to which you shall reasonably object after being so advised; and, during such period, to prepare and file with the Commission, promptly upon your reasonable request, any amendment to the Registration Statement or amendment or supplement to the Prospectus which may be necessary or advisable in connection with the distribution of the Shares by you, and to use its best efforts to cause any such amendment to the Registration Statement to become promptly effective.

(d) Prior to 10:00 A.M., New York City time, on the first business day after the date of this Agreement and from time to time thereafter for such period as in the opinion of counsel for the Underwriters a prospectus is required by law to be delivered in connection with sales by an Underwriter or a dealer, to furnish in New York City to each Underwriter and any dealer as many copies of the Prospectus (and of any amendment or supplement to the Prospectus) as such Underwriter or dealer may reasonably request.

(e) If during the period specified in Section 5(d), any event shall occur or condition shall exist as a result of which, in the opinion of counsel for the Underwriters, it becomes necessary to amend or supplement the Prospectus in order to make the statements therein, in the light of the circumstances when the Prospectus is delivered to a purchaser, not misleading, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or

4

supplement the Prospectus to comply with applicable law, forthwith to prepare and file with the Commission an appropriate amendment or supplement to the Prospectus so that the statements in the Prospectus, as so amended or supplemented, will not in the light of the circumstances when it is so delivered, be misleading, or so that the Prospectus will comply with applicable law, and to furnish to each Underwriter and to any dealer as many copies thereof as such Underwriter or dealer may reasonably request.

(f) Prior to any public offering of the Shares, to cooperate with you and counsel for the Underwriters in connection with the registration or qualification of the Shares for offer and sale by the several Underwriters and by dealers under the state securities or Blue Sky laws of such jurisdictions as you may request, to continue such registration or qualification in effect so long as required for distribution of the Shares and to file such consents to service of process or other documents as may be necessary in order to effect such registration or qualification; provided, however, that the Company shall not be required in connection therewith to qualify as a foreign corporation in any jurisdiction in which it is not now so qualified or to take any action that would subject it to general consent to service of process or taxation other than as to matters and transactions relating to the Prospectus, the Registration Statement, any preliminary prospectus or the offering or sale of the Shares, in any jurisdiction in which it is not now so subject.

(g) To mail and make generally available to its stockholders as soon as practicable an earnings statement covering the twelve-month period ending [INSERT DATE ONE YEAR AFTER THE END OF THE COMPANY'S FISCAL QUARTER IN WHICH THE CLOSING WILL OCCUR] __________, 2000 that shall satisfy the provisions of Section 11(a) of the Act, and to advise you in writing when such statement has been so made available.

(h) During the period of three (3) years after the date of this Agreement, to furnish to you as soon as available copies of all reports or other communications furnished to the record holders of Common Stock or furnished to or filed with the Commission or any national securities exchange on which any class of securities of the Company is listed and such other publicly available information concerning the Company and its subsidiaries as you may reasonably request.

(i) Whether or not the transactions contemplated in this Agreement are consummated or this Agreement is terminated, to pay or cause to be paid all expenses incident to the performance of its obligations under this Agreement, including: (i) the fees, disbursements and expenses of the Company's counsel and the Company's accountants in connection with the registration and delivery of the Shares under the Act and all other fees and expenses in connection with the preparation, printing, filing and distribution of the Registration Statement (including financial statements and exhibits), any preliminary prospectus, the Prospectus and all amendments and supplements to any of the foregoing, including the mailing and delivering of copies thereof to the Underwriters and dealers in the quantities specified herein, (ii) all costs and expenses related to the transfer and delivery of the Shares to the Underwriters, including any transfer or other taxes payable thereon, (iii) all costs of printing or producing this Agreement and any other agreements or documents in connection with the offering, purchase, sale or delivery of the Shares, (iv) all expenses in connection with the registration or qualification

5

of the Shares for offer and sale under the securities or Blue Sky laws of the several states and all costs of printing or producing any Preliminary and Supplemental Blue Sky Memoranda in connection therewith (including the filing fees and fees and disbursements of counsel for the Underwriters in connection with such registration or qualification and memoranda relating thereto), (v) the filing fees and disbursements of counsel for the Underwriters in connection with the review and clearance of the offering of the Shares by the National Association of Securities Dealers, Inc., (vi) all fees and expenses in connection with the preparation and filing of the Registration Statement on Form 8-A relating to the Common Stock and all costs and expenses incident to the listing of the Shares on the Nasdaq National Market, (vii) the cost of printing certificates representing the Shares, (viii) the costs and charges of any transfer agent, registrar and/or depositary, and (ix) all other costs and expenses incident to the performance of the obligations of the Company hereunder for which provision is not otherwise made in this Section.

(j) To use its best efforts to list for quotation the Shares on the Nasdaq National Market and to maintain the listing of the Shares on the Nasdaq National Market for a period of three (3) years after the date of this Agreement.

(k) To use its best efforts to do and perform all things required or necessary to be done and performed under this Agreement by the Company prior to the Closing Date or any Option Closing Date, as the case may be, and to satisfy all conditions precedent to the delivery of the Shares.

(l) If the Registration Statement at the time of the effectiveness of this Agreement does not cover all of the Shares, to file a Rule
462(b) Registration Statement with the Commission registering the Shares not so covered in compliance with Rule 462(b) by 10:00 P.M., New York City time, on the date of this Agreement and to pay to the Commission the filing fee for such Rule
462(b) Registration Statement at the time of the filing thereof or to give irrevocable instructions for the payment of such fee pursuant to Rule 111(b) under the Act.

SECTION 6. Representations and Warranties of the Company. The Company represents and warrants to each Underwriter that:

(a) The Registration Statement has become effective (other than any Rule 462(b) Registration Statement to be filed by the Company after the effectiveness of this Agreement); any Rule 462(b) Registration Statement filed after the effectiveness of this Agreement will become effective no later than 10:00 P.M., New York City time, on the date of this Agreement; and no stop order suspending the effectiveness of the Registration Statement is in effect, and no proceedings for such purpose are pending before or threatened by the Commission.

(b) (i) The Registration Statement (other than any Rule
462(b) Registration Statement to be filed by the Company after the effectiveness of this Agreement), when it became effective, did not contain and, as amended, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) the Registration Statement (other than any Rule 462(b) Registration Statement to be filed by the Company after the effectiveness

6

of this Agreement) and the Prospectus comply and, as amended or supplemented, if applicable, will comply in all material respects with the Act, (iii) if the Company is required to file a Rule 462(b) Registration Statement after the effectiveness of this Agreement, such Rule 462(b) Registration Statement and any amendments thereto, when they become effective (A) will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (B) will comply in all material respects with the Act and (iv) the Prospectus does not contain and, as amended or supplemented, if applicable, will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in the Registration Statement or the Prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.

(c) Each preliminary prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto, or filed pursuant to Rule 424 under the Act, complied when so filed in all material respects with the Act, and did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, except that the representations and warranties set forth in this paragraph do not apply to statements or omissions in any preliminary prospectus based upon information relating to any Underwriter furnished to the Company in writing by such Underwriter through you expressly for use therein.

(d) Each of the Company and its subsidiaries has been duly incorporated, is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation and has the corporate power and authority to carry on its business as described in the Prospectus and to own, lease and operate its properties, and each is duly qualified and is in good standing as a foreign corporation authorized to do business in each jurisdiction in which the nature of its business or its ownership or leasing of property requires such qualification, except where the failure to be so qualified would not have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole.

(e) There are no outstanding subscriptions, rights, warrants, options, calls, convertible securities, commitments of sale or liens granted or issued by the Company or any of its subsidiaries relating to or entitling any person to purchase or otherwise to acquire any shares of the capital stock of the Company or any of its subsidiaries, except as otherwise disclosed in the Registration Statement.

(f) All the outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid, non-assessable and not subject to any preemptive or similar rights; and the Shares have been duly authorized and, when issued and delivered to the Underwriters against payment therefor as provided by this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights.

7

(g) All of the outstanding shares of capital stock of each of the Company's subsidiaries have been duly authorized and validly issued and are fully paid and non-assessable, and are owned by the Company, directly or indirectly through one or more subsidiaries, free and clear of any security interest, claim, lien, encumbrance or adverse interest of any nature.

(h) The authorized capital stock of the Company conforms as to legal matters to the description thereof contained in the Prospectus.

(i) Neither the Company nor any of its subsidiaries is in violation of its respective charter or by-laws or in default in the performance of any obligation, agreement, covenant or condition contained in any indenture, loan agreement, mortgage, lease or other agreement or instrument that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound.

(j) This Agreement has been duly authorized, executed and delivered by the Company.

(k) The execution, delivery and performance of this Agreement by the Company, the compliance by the Company with all the provisions hereof and the consummation of the transactions contemplated hereby will not (i) require any consent, approval, authorization or other order of, or qualification with, any court or governmental body or agency (except such as may be required under the securities or Blue Sky laws of the various states), (ii) conflict with or constitute a breach of any of the terms or provisions of, or a default under, the charter or by-laws of the Company or any of its subsidiaries or any indenture, loan agreement, mortgage, lease or other agreement or instrument that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound, (iii) violate or conflict with any applicable law or any rule, regulation, judgment, order or decree of any court or any governmental body or agency having jurisdiction over the Company, any of its subsidiaries or their respective property or (iv) result in the suspension, termination or revocation of any Authorization (as defined below) of the Company or any of its subsidiaries or any other impairment of the rights of the holder of any such Authorization.

(l) The Company and its subsidiaries own or possess, or can acquire on reasonable terms, all patents, patent rights, licenses, inventions, copyrights, trademarks, service marks, trade names, mask work rights, technology and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures) ("INTELLECTUAL PROPERTY") necessary to conduct the business now or as proposed to be conducted by the Company as described in the Registration Statement. Neither the Company nor any of its subsidiaries has received any notice of infringement of or conflict with (or knows of such infringement of or conflict with) asserted rights of others with respect to any of such intellectual property which, singly or in the aggregate, if the subject of any unfavorable decision, ruling or finding, would have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole. To the

8

Company's knowledge, the discoveries, inventions, products or processes of the Company referred to in the Registration Statement do not infringe or conflict with any right or patent of any third party, or any discovery, invention, product or process which is the subject of a patent application filed by any third party.

(m) There are no legal or governmental proceedings pending or threatened to which the Company or any of its subsidiaries is or could be a party or to which any of their respective property is or could be subject that are required to be described in the Registration Statement or the Prospectus and are not so described; nor are there any statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not so described or filed as required.

(n) No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries on the one hand, and the directors, officers, stockholders, customers or suppliers of the Company or any of its subsidiaries on the other hand, which is required by the Act to be described in the Registration Statement or the Prospectus which is not so described. (o) Each of the Company and its subsidiaries has such permits, licenses, consents, exemptions, franchises, authorizations and other approvals (each, an "AUTHORIZATION") of, and has made all filings with and notices to, all governmental or regulatory authorities and self-regulatory organizations and all courts and other tribunals, including, without limitation, under any applicable Environmental Laws (as defined below), as are necessary to own, lease, license and operate its respective properties and to conduct its respective business, except where the failure to have any such Authorization or to make any such filing or notice would not, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole. Each such Authorization is valid and in full force and effect and each of the Company and its subsidiaries is in compliance with all the terms and conditions thereof and with the rules and regulations of the authorities and governing bodies having jurisdiction with respect thereto; and no event has occurred (including, without limitation, the receipt of any notice from any authority or governing body) which allows or, after notice or lapse of time or both, would allow, revocation, suspension or termination of any such Authorization or results or, after notice or lapse of time or both, would result in any other impairment of the rights of the holder of any such Authorization; and such Authorizations contain no restrictions that are burdensome to the Company or any of its subsidiaries; except where such failure to be valid and in full force and effect or to be in compliance, the occurrence of any such event or the presence of any such restriction would not, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole.

(p) Neither the Company nor any of its subsidiaries has violated any foreign, federal, state or local law or regulation relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), any provisions of the Employee Retirement Income Security Act of

9

1974, as amended, or any provisions of the Foreign Corrupt Practices Act, or the rules and regulations promulgated thereunder, except for such violations which, singly or in the aggregate, would not have a material adverse effect on the business, prospects, financial condition or results of operation of the Company and its subsidiaries, taken as a whole.

(q) There are no costs or liabilities associated with Environmental Laws (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any Authorization, any related constraints on operating activities and any potential liabilities to third parties) which would, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole.

(r) PricewaterhouseCoopers LLP are independent public accountants with respect to the Company and its subsidiaries as required by the Act.

(s) The consolidated financial statements included in the Registration Statement and the Prospectus (and any amendment or supplement thereto), together with related schedules and notes, present fairly the consolidated financial position, results of operations and changes in financial position of the Company and its subsidiaries on the basis stated therein at the respective dates or for the respective periods to which they apply; such statements and related schedules and notes have been prepared in accordance with generally accepted accounting principles consistently applied throughout the periods involved, except as disclosed therein; the supporting schedules, if any, included in the Registration Statement present fairly in accordance with generally accepted accounting principles the information required to be stated therein; and the other financial and statistical information and data set forth in the Registration Statement and the Prospectus (and any amendment or supplement thereto) are, in all material respects, accurately presented and prepared on a basis consistent with such financial statements and the books and records of the Company.

(t) The Company and each of its subsidiaries maintains a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management's general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with general accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

(u) All material tax returns required to be filed by the Company and each of its subsidiaries in any jurisdiction have been filed, other than those filings being contested in good faith, and all material taxes, including withholding taxes, penalties and interest, assessments, fees and other charges due pursuant to such returns or pursuant to any assessment received by the Company or any of its subsidiaries have been paid, other than those being contested in good faith and for which adequate reserves have been provided.

10

(v) The Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus, will not be, an "investment company" as such term is defined in the Investment Company Act of 1940, as amended.

(w) There are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement.

(x) Since the respective dates as of which information is given in the Prospectus and other than as set forth in the Prospectus (exclusive of any amendments or supplements thereto subsequent to the date of this Agreement), (i) there has not occurred any material adverse change or any development involving a prospective material adverse change in the condition, financial or otherwise, or the earnings, business, prospects, management or operations of the Company and its subsidiaries, taken as a whole, (ii) there has not been any material adverse change or any development involving a prospective material adverse change in the capital stock or in the long-term debt of the Company or any of its subsidiaries and (iii) neither the Company nor any of its subsidiaries has incurred any material liability or obligation, direct or contingent.

(y) The Company and its subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the Prospectus or such as do not materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries, in each case except as described in the Prospectus.

(z) The Company and each of its subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which they are engaged; and neither the Company nor any of its subsidiaries (i) has received notice from any insurer or agent of such insurer that substantial capital improvements or other material expenditures will have to be made in order to continue such insurance or (ii) has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers at a cost that would not have a material adverse effect on the business, prospects, financial conditions or results of the Company and its subsidiaries, taken as a whole.

(aa) There is no (i) significant unfair labor practice complaint, grievance or arbitration proceeding pending or threatened against the Company or any of its subsidiaries before the National Labor Relations Board or any state or local labor relations board,

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(ii) strike, labor dispute, slowdown or stoppage pending or threatened against the Company or any of its subsidiaries or (iii) union representation question existing with respect to the employees of the Company and its subsidiaries, except for such actions specified in clause (i), (ii) or (iii) above, which, singly or in the aggregate, would not have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole. To the best of the Company's knowledge, no collective bargaining organizing activities are taking place with respect to the Company or any of its subsidiaries.

(bb) (i) To the Company's knowledge, none of the computer software, computer firmware, computer hardware (whether general or special purpose) or other similar or related items of automated, computerized or software systems that are used or relied on by the Company or sub-licensed to the Company in the conduct of its business will malfunction, will cease to function, will generate incorrect data or will produce incorrect results when processing, providing or receiving (i) date-related data from, into and between the Twentieth (20th) and Twenty-First (21st) centuries or (ii) date-related data in connection with any valid date in the Twentieth (20th) and Twenty-First
(21st) centuries, causing a material adverse effect on the Company.

(ii) None of the products and services sold, licensed, rendered, or otherwise provided by the Company in the conduct of its business will malfunction, will cease to function, will generate incorrect data or will produce incorrect results when processing, providing or receiving (i) date-related data from, into and between the Twentieth (20th) and Twenty-First
(21st) centuries or (ii) date-related data in connection with any valid date in the Twentieth (20th) and Twenty-First (21st) centuries, causing a material adverse effect on the Company.

(iii) The Company has not made any representations or warranties relating to the ability of any product or service sold, licensed, rendered, or otherwise provided by the Company in the conduct of its business to operate without malfunction, to operate without ceasing to function, to generate correct data or to produce correct results when processing, providing or receiving (i) date-related data from, into and between the Twentieth (20th) and Twenty-First (21st) centuries and (ii) date-related data in connection with any valid date in the Twentieth (20th) and Twenty-First (21st) centuries.

(cc) Each product manufactured, sold, licensed, leased, or delivered by the Company has been in conformity with all applicable contractual commitments and all express and implied warranties except where the failure to be in such conformity would not have a material and adverse effect on the Company. The Company has no liability, and to the Company's knowledge, there is no current reasonable basis for any action, suit, proceeding, hearing, investigation, charge, complaint, claim, or demand giving rise to any liability, for replacement or repair thereof or other damages in connection therewith. No product manufactured, sold, licensed, leased or delivered by the Company is subject to any guaranty, lease or warranty beyond that implied or imposed by applicable law. Schedule 6(cc) includes a copy of the Company's standard terms and conditions of sale, license and lease.

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(dd) Each certificate signed by any officer of the Company and delivered to the Underwriters or counsel for the Underwriters shall be deemed to be a representation and warranty by the Company to the Underwriters as to the matters covered thereby.

SECTION 7. Indemnification. (a) The Company agrees to indemnify and hold harmless each Underwriter, its directors, its officers and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act or Section 20 of the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), from and against any and all losses, claims, damages, liabilities and judgments (including, without limitation, any legal or other expenses incurred in connection with investigating or defending any matter, including any action, that could give rise to any such losses, claims, damages, liabilities or judgments) caused by any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or supplement thereto) or any preliminary prospectus, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or judgments are caused by any such untrue statement or omission or alleged untrue statement or omission based upon information relating to any Underwriter furnished in writing to the Company by such Underwriter through you expressly for use therein; provided, however, that the foregoing indemnity agreement with respect to any preliminary prospectus shall not inure to the benefit of any Underwriter who failed to deliver a Prospectus, as then amended or supplemented (so long as the Prospectus and any amendments or supplements thereto was provided by the Company to the several Underwriters in the requisite quantity and on a timely basis to permit proper delivery on or prior to the Closing Date), to the person asserting any losses, claims, damages, liabilities or judgments caused by any untrue statement or alleged untrue statement of a material fact contained in such preliminary prospectus, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, if such material misstatement or omission or alleged material misstatement or omission was cured in the Prospectus, as so amended or supplemented, and such Prospectus was required by law to be delivered at or prior to the written confirmation of sale to such person.

(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, its officers who sign the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the same extent as the foregoing indemnity from the Company to such Underwriter but only with reference to information relating to such Underwriter furnished in writing to the Company by such Underwriter through you expressly for use in the Registration Statement (or any amendment thereto), the Prospectus (or any amendment or supplement thereto) or any preliminary prospectus.

(c) In case any action shall be commenced involving any person in respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (the "INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing and the indemnifying party shall assume the defense of such action, including the employment of counsel reasonably satisfactory to the

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indemnified party and the payment of all fees and expenses of such counsel, as incurred (except that in the case of any action in respect of which indemnity may be sought pursuant to both Sections 7(a) and 7(b), the Underwriter shall not be required to assume the defense of such action pursuant to this Section 7(c), but may employ separate counsel and participate in the defense thereof, but the fees and expenses of such counsel, except as provided below, shall be at the expense of such Underwriter). Any indemnified party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of the indemnified party unless (i) the employment of such counsel shall have been specifically authorized in writing by the indemnifying party, (ii) the indemnifying party shall have failed to assume the defense of such action or employ counsel reasonably satisfactory to the indemnified party or (iii) the named parties to any such action (including any impleaded parties) include both the indemnified party and the indemnifying party, and the indemnified party shall have been advised by such counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the indemnifying party (in which case the indemnifying party shall not have the right to assume the defense of such action on behalf of the indemnified party). In any such case, the indemnifying party shall not, in connection with any one action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for (i) the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for all Underwriters, their officers and directors and all persons, if any, who control any Underwriter within the meaning of either Section 15 of the Act or Section 20 of the Exchange Act and (ii) the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for the Company, its directors, its officers who sign the Registration Statement and all persons, if any, who control the Company within the meaning of either such Section, and all such fees and expenses shall be reimbursed as they are incurred. In the case of any such separate firm for the Underwriters, their officers and directors and such control persons of any Underwriters, such firm shall be designated in writing by Donaldson, Lufkin & Jenrette Securities Corporation. In the case of any such separate firm for the Company and such directors, officers and control persons of the Company, such firm shall be designated in writing by the Company. The indemnifying party shall indemnify and hold harmless the indemnified party from and against any and all losses, claims, damages, liabilities and judgments by reason of any settlement of any action (i) effected with its written consent or
(ii) effected without its written consent if the settlement is entered into more than twenty business days after the indemnifying party shall have received a request from the indemnified party for reimbursement for the fees and expenses of counsel (in any case where such fees and expenses are at the expense of the indemnifying party) and, prior to the date of such settlement, the indemnifying party shall have failed to comply with such reimbursement request. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement or compromise of, or consent to the entry of judgment with respect to, any pending or threatened action in respect of which the indemnified party is or could have been a party and indemnity or contribution may be or could have been sought hereunder by the indemnified party, unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability on claims that are or could have been the subject matter of such action and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of the indemnified party.

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(d) To the extent the indemnification provided for in this
Section 7 is unavailable to an indemnified party or insufficient in respect of any losses, claims, damages, liabilities or judgments referred to therein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities and judgments (i) in such proportion as is appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand from the offering of the Shares or (ii) if the allocation provided by clause 7(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 7(d)(i) above but also the relative fault of the Company on the one hand and the Underwriters on the other hand in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities or judgments, as well as any other relevant equitable considerations. The relative benefits received by the Company on the one hand and the Underwriters on the other hand shall be deemed to be in the same proportion as the total net proceeds from the offering (after deducting underwriting discounts and commissions, but before deducting expenses) received by the Company, and the total underwriting discounts and commissions received by the Underwriters, bear to the total price to the public of the Shares, in each case as set forth in the table on the cover page of the Prospectus. The relative fault of the Company on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

The Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in the immediately preceding paragraph. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities or judgments referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses incurred by such indemnified party in connection with investigating or defending any matter, including any action, that could have given rise to such losses, claims, damages, liabilities or judgments. Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Shares underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Underwriters' obligations to contribute pursuant to this Section 7(d) are several in proportion to the respective number of Shares purchased by each of the Underwriters hereunder and not joint.

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(e) The remedies provided for in this Section 7 are not exclusive and shall not limit any rights or remedies which may otherwise be available to any indemnified party at law or in equity.

SECTION 8. Conditions of Underwriters' Obligations. The several obligations of the Underwriters to purchase the Firm Shares under this Agreement are subject to the satisfaction of each of the following conditions:

(a) All the representations and warranties of the Company contained in this Agreement shall be true and correct on the Closing Date with the same force and effect as if made on and as of the Closing Date.

(b) If the Company is required to file a Rule 462(b) Registration Statement after the effectiveness of this Agreement, such Rule 462(b) Registration Statement shall have become effective by 10:00 P.M., New York City time, on the date of this Agreement; and no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been commenced or shall be pending before or contemplated by the Commission.

(c) You shall have received on the Closing Date a certificate dated the Closing Date, signed by Ken Gardner and Virginia Walker, in their capacities as the President and Chief Executive Officer, and Chief Financial Officer, respectively, of the Company, confirming the matters set forth in Sections 6(x), 8(a) and 8(b) and that the Company has complied with all of the agreements and satisfied all of the conditions herein contained and required to be complied with or satisfied by the Company on or prior to the Closing Date.

(d) Since the respective dates as of which information is given in the Prospectus other than as set forth in the Prospectus (exclusive of any amendments or supplements thereto subsequent to the date of this Agreement), (i) there shall not have occurred any change or any development involving a prospective change in the condition, financial or otherwise, or the earnings, business, management or operations of the Company and its subsidiaries, taken as a whole, (ii) there shall not have been any change or any development involving a prospective change in the capital stock or in the long-term debt of the Company or any of its subsidiaries and (iii) neither the Company nor any of its subsidiaries shall have incurred any liability or obligation, direct or contingent, the effect of which, in any such case described in clause 8(d)(i), 8(d)(ii) or 8(d)(iii), in your judgment, is material and adverse and, in your judgment, makes it impracticable to market the Shares on the terms and in the manner contemplated in the Prospectus.

(e) You shall have received on the Closing Date an opinion (satisfactory to you and counsel for the Underwriters), dated the Closing Date, of Wilson Sonsini Goodrich & Rosati, a Professional Corporation ("WSGR"), counsel for the Company, to the effect that:

(i) each of the Company and its subsidiaries has been duly incorporated, is validly existing as a corporation in good standing under the laws of its

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jurisdiction of incorporation and has the corporate power and authority to carry on its business as described in the Prospectus and to own, lease and operate its properties;

(ii) each of the Company and its subsidiaries is duly qualified and is in good standing as a foreign corporation authorized to do business in each jurisdiction in which the nature of its business or its ownership or leasing of property requires such qualification, except where the failure to be so qualified would not have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole;

(iii) all the outstanding shares of capital stock of the Company have been duly authorized and validly issued and are fully paid, non-assessable and not subject to any preemptive or similar rights;

(iv) the Shares have been duly authorized and, when issued and delivered to the Underwriters against payment therefor as provided by this Agreement, will be validly issued, fully paid and non-assessable, and the issuance of such Shares will not be subject to any preemptive or similar rights;

(v) all of the outstanding shares of capital stock of each of the Company's subsidiaries have been duly authorized and validly issued and are fully paid and non-assessable, and are owned by the Company, directly or indirectly through one or more subsidiaries, free and clear of any security interest, claim, lien, encumbrance or adverse interest of any nature;

(vi) this Agreement has been duly authorized, executed and delivered by the Company;

(vii) the authorized capital stock of the Company conforms as to legal matters to the description thereof contained in the Prospectus;

(viii) the Registration Statement has become effective under the Act, no stop order suspending its effectiveness has been issued and no proceedings for that purpose are, to the best of such counsel's knowledge after due inquiry, pending before or contemplated by the Commission;

(ix) the statements under the captions "Risk Factors--Risks Associated with Intellectual Property," "Risk Factors--Risks Related to Third Party Technology," "Business--Legal Proceedings," "Business--Intellectual Property," "Management--Limitation on Liability and Indemnification Matters," "Management--Employee Benefit Plans," "Certain Transactions," "Description of Capital Stock" and "Underwriting" in the Prospectus and Items 14 and 15 of Part II of the Registration Statement, insofar as such statements constitute a summary of the legal matters, documents or proceedings referred to therein, fairly present the information called for with respect to such legal matters, documents and proceedings;

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(x) neither the Company nor any of its subsidiaries is in violation of its respective charter or by-laws and, to the best of such counsel's knowledge after due inquiry, neither the Company nor any of its subsidiaries is in default in the performance of any obligation, agreement, covenant or condition contained in any indenture, loan agreement, mortgage, lease or other agreement or instrument that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound;

(xi) the execution, delivery and performance of this Agreement by the Company, the compliance by the Company with all the provisions hereof and the consummation of the transactions contemplated hereby will not (A) require any consent, approval, authorization or other order of, or qualification with, any court or governmental body or agency (except such as may be required under the securities or Blue Sky laws of the various states), (B) conflict with or constitute a breach of any of the terms or provisions of, or a default under, the charter or by-laws of the Company or any of its subsidiaries or any indenture, loan agreement, mortgage, lease or other agreement or instrument that is material to the Company and its subsidiaries, taken as a whole, to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries or their respective property is bound, (C) violate or conflict with any applicable law or any rule, regulation, judgment, order or decree of any court or any governmental body or agency having jurisdiction over the Company, any of its subsidiaries or their respective property or (D) result in the suspension, termination or revocation of any Authorization of the Company or any of its subsidiaries or any other impairment of the rights of the holder of any such Authorization;

(xii) after due inquiry, such counsel does not know of any legal or governmental proceedings pending or threatened to which the Company or any of its subsidiaries is or could be a party or to which any of their respective property is or could be subject that are required to be described in the Registration Statement or the Prospectus and are not so described, or of any statutes, regulations, contracts or other documents that are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits to the Registration Statement that are not so described or filed as required;

(xiii) neither the Company nor any of its subsidiaries has violated any Environmental Law, any provisions of the Employee Retirement Income Security Act of 1974, as amended, or any provisions of the Foreign Corrupt Practices Act, or the rules and regulations promulgated thereunder, except for such violations which, singly or in the aggregate, would not have a material adverse effect on the business, prospects, financial condition or results of operation of the Company and its subsidiaries, taken as a whole;

(xiv) each of the Company and its subsidiaries has such Authorizations of, and has made all filings with and notices to, all governmental or regulatory authorities and self-regulatory organizations and all courts and other tribunals, including, without limitation, under any applicable Environmental Laws, as are necessary to own, lease, license and operate its respective properties and to conduct its business, except where the failure to have any such Authorization or to make any such filing or notice would not, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of

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operations of the Company and its subsidiaries, taken as a whole; each such Authorization is valid and in full force and effect and each of the Company and its subsidiaries is in compliance with all the terms and conditions thereof and with the rules and regulations of the authorities and governing bodies having jurisdiction with respect thereto; and no event has occurred (including, without limitation, the receipt of any notice from any authority or governing body) which allows or, after notice or lapse of time or both, would allow, revocation, suspension or termination of any such Authorization or results or, after notice or lapse of time or both, would result in any other impairment of the rights of the holder of any such Authorization; and such Authorizations contain no restrictions that are burdensome to the Company or any of its subsidiaries; except where such failure to be valid and in full force and effect or to be in compliance, the occurrence of any such event or the presence of any such restriction would not, singly or in the aggregate, have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole;

(xv) the Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds thereof as described in the Prospectus, will not be, an "investment company" as such term is defined in the Investment Company Act of 1940, as amended;

(xvi) to the best of such counsel's knowledge after due inquiry, there are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Act with respect to any securities of the Company or to require the Company to include such securities with the Shares registered pursuant to the Registration Statement; and

(xvii) The Company and its subsidiaries have good and marketable title in fee simple to all real property and good and marketable title to all personal property owned by them which is material to the business of the Company and its subsidiaries, in each case free and clear of all liens, encumbrances and defects except such as are described in the Prospectus or such as do not materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company and its subsidiaries; and any real property and buildings held under lease by the Company and its subsidiaries are held by them under valid, subsisting and enforceable leases with such exceptions as are not material and do not interfere with the use made and proposed to be made of such property and buildings by the Company and its subsidiaries, in each case except as described in the Prospectus.

(xviii) The Company and its subsidiaries own or possess, or can acquire on reasonable terms, all patents, patent rights, licenses, inventions, copyrights, trademarks, service marks, trade names, mask work rights, technology and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), ("INTELLECTUAL PROPERTY") necessary to conduct the business now or as proposed to be conducted by the Company as described in the Registration Statement. To the best of such counsel's knowledge after due inquiry, neither the Company nor any of its subsidiaries has received any notice of infringement of or conflict with (or knows of such infringement of or conflict with) asserted rights of others with respect to any of such intellectual property which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or

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finding, would have a material adverse effect on the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole. To the best of such counsel's knowledge after due inquiry, the discoveries, inventions, products or processes of the Company referred to in the Registration Statement do not infringe or conflict with any right or patent of any third party, or any discovery, invention, product or process which is the subject of a patent application filed by any third party.

(xix) (A) the Registration Statement and the Prospectus and any supplement or amendment thereto (except for the financial statements and other financial data included therein as to which no opinion need be expressed) comply as to form with the Act, (B) such counsel has no reason to believe that at the time the Registration Statement became effective or on the date of this Agreement, the Registration Statement and the prospectus included therein (except for the financial statements and other financial data as to which such counsel need not express any belief) contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading and (C) such counsel has no reason to believe that the Prospectus, as amended or supplemented, if applicable (except for the financial statements and other financial data, as aforesaid) contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

The opinion of WSGR described in this Section 8(e) shall be rendered to you at the request of the Company and shall so state therein.

(f) You shall have received on the Closing Date an opinion, dated the Closing Date, of Brobeck, Phleger & Harrison LLP ("BPH"), counsel for the Underwriters, as to the matters referred to in Sections 8(e)(iv), 8(e)(vi),
8(e)(ix) (but only with respect to the statements under the caption "Description of Capital Stock" and "Underwriting") and 8(e)(xix).

In giving such opinions with respect to the matters covered by
Section 8(e)(xix), WSGR and BPH may state that their opinion and belief are based upon their participation in the preparation of the Registration Statement and Prospectus and any amendments or supplements thereto and review and discussion of the contents thereof, but are without independent check or verification except as specified.

(g) You shall have received, on each of the date hereof and the Closing Date, a letter dated the date hereof or the Closing Date, as the case may be, in form and substance satisfactory to you, from PricewaterhouseCoopers LLP, independent public accountants, containing the information and statements of the type ordinarily included in accountants' "comfort letters" to Underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus.

(h) The Company shall have delivered to you the agreements specified in Section 2 hereof which agreements shall be in full force and effect on the Closing Date.

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(i) The Shares shall have been duly listed for quotation on the Nasdaq National Market.

(j) The Company shall not have failed on or prior to the Closing Date to perform or comply with any of the agreements herein contained and required to be performed or complied with by the Company on or prior to the Closing Date.

The several obligations of the Underwriters to purchase any Additional Shares hereunder are subject to the delivery to you on the applicable Option Closing Date of such documents as you may reasonably request with respect to the good standing of the Company, the due authorization and issuance of such Additional Shares and other matters related to the issuance of such Additional Shares.

SECTION 9. Effectiveness of Agreement and Termination. This Agreement shall become effective upon the execution and delivery of this Agreement by the parties hereto.

This Agreement may be terminated at any time on or prior to the Closing Date by you by written notice to the Company if any of the following has occurred: (i) any outbreak or escalation of hostilities or other national or international calamity or crisis or change in economic conditions or in the financial markets of the United States or elsewhere that, in your judgment, is material and adverse and, in your judgment, makes it impracticable to market the Shares on the terms and in the manner contemplated in the Prospectus, (ii) the suspension or material limitation of trading in securities or other instruments on the New York Stock Exchange, the American Stock Exchange, the Chicago Board of Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade or the Nasdaq National Market or limitation on prices for securities or other instruments on any such exchange or the Nasdaq National Market, (iii) the suspension of trading of any securities of the Company on any exchange or in the over-the-counter market, (iv) the enactment, publication, decree or other promulgation of any federal or state statute, regulation, rule or order of any court or other governmental authority which in your opinion materially and adversely affects, or will materially and adversely affect, the business, prospects, financial condition or results of operations of the Company and its subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by either federal or New York State authorities or (vi) the taking of any action by any federal, state or local government or agency in respect of its monetary or fiscal affairs which in your opinion has a material adverse effect on the financial markets in the United States.

If on the Closing Date or on an Option Closing Date, as the case may be, any one or more of the Underwriters shall fail or refuse to purchase the Firm Shares or Additional Shares, as the case may be, which it has or they have agreed to purchase hereunder on such date and the aggregate number of Firm Shares or Additional Shares, as the case may be, which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase is not more than one-tenth of the total number of Firm Shares or Additional Shares, as the case may be, to be purchased on such date by all Underwriters, each non-defaulting Underwriter shall be obligated severally, in the proportion which the number of Firm Shares set forth opposite its name in Schedule I bears to the total number of Firm Shares which all the non-defaulting Underwriters have agreed to purchase, or in such other proportion as you may specify, to purchase the Firm

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Shares or Additional Shares, as the case may be, which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date; provided that in no event shall the number of Firm Shares or Additional Shares, as the case may be, which any Underwriter has agreed to purchase pursuant to Section 2 hereof be increased pursuant to this Section 9 by an amount in excess of one-ninth of such number of Firm Shares or Additional Shares, as the case may be, without the written consent of such Underwriter. If on the Closing Date any Underwriter or Underwriters shall fail or refuse to purchase Firm Shares and the aggregate number of Firm Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Firm Shares to be purchased by all Underwriters and arrangements satisfactory to you and the Company for purchase of such Firm Shares are not made within 48 hours after such default, this Agreement will terminate without liability on the part of any non-defaulting Underwriter and the Company. In any such case which does not result in termination of this Agreement, either you or the Company shall have the right to postpone the Closing Date, but in no event for longer than seven days, in order that the required changes, if any, in the Registration Statement and the Prospectus or any other documents or arrangements may be effected. If, on an Option Closing Date, any Underwriter or Underwriters shall fail or refuse to purchase Additional Shares and the aggregate number of Additional Shares with respect to which such default occurs is more than one-tenth of the aggregate number of Additional Shares to be purchased on such date, the non-defaulting Underwriters shall have the option to (i) terminate their obligation hereunder to purchase such Additional Shares or (ii) purchase not less than the number of Additional Shares that such non-defaulting Underwriters would have been obligated to purchase on such date in the absence of such default. Any action taken under this paragraph shall not relieve any defaulting Underwriter from liability in respect of any default of any such Underwriter under this Agreement.

SECTION 10. Miscellaneous. Notices given pursuant to any provision of this Agreement shall be addressed as follows: (i) if to the Company, to Sagent Technology, Inc., 800 W. El Camino Real, Suite 300, Mountain View, CA 94040 and (ii) if to any Underwriter or to you, to you c/o Donaldson, Lufkin & Jenrette Securities Corporation, 277 Park Avenue, New York, New York 10172, Attention:
Syndicate Department, or in any case to such other address as the person to be notified may have requested in writing.

The respective indemnities, contribution agreements, representations, warranties and other statements of the Company and the several Underwriters set forth in or made pursuant to this Agreement shall remain operative and in full force and effect, and will survive delivery of and payment for the Shares, regardless of (i) any investigation, or statement as to the results thereof, made by or on behalf of any Underwriter, the officers or directors of any Underwriter, any person controlling any Underwriter, the Company, the officers or directors of the Company or any person controlling the Company, (ii) acceptance of the Shares and payment for them hereunder and (iii) termination of this Agreement.

If for any reason the Shares are not delivered by or on behalf of the Company as provided herein (other than as a result of any termination of this Agreement pursuant to Section 9), the Company agrees to reimburse the several Underwriters for all out-of-pocket expenses (including the fees and disbursements of counsel) incurred by them. Notwithstanding any termination of this Agreement, the Company shall be liable for all expenses which it has agreed

22

to pay pursuant to Section 5(i) hereof. The Company also agrees to reimburse the several Underwriters, their directors and officers and any persons controlling any of the Underwriters for any and all fees and expenses (including, without limitation, the fees disbursements of counsel) incurred by them in connection with enforcing their rights hereunder (including, without limitation, pursuant to Section 7 hereof).

Except as otherwise provided, this Agreement has been and is made solely for the benefit of and shall be binding upon the Company, the Underwriters, the Underwriters' directors and officers, any controlling persons referred to herein, the Company's directors and the Company's officers who sign the Registration Statement and their respective successors and assigns, all as and to the extent provided in this Agreement, and no other person shall acquire or have any right under or by virtue of this Agreement. The term "successors and assigns" shall not include a purchaser of any of the Shares from any of the several Underwriters merely because of such purchase.

This Agreement shall be governed and construed in accordance with the laws of the State of New York.

This Agreement may be signed in various counterparts which together shall constitute one and the same instrument.

23

Please confirm that the foregoing correctly sets forth the agreement between the Company and the several Underwriters.

Very truly yours,

SAGENT TECHNOLOGY, INC.

By:

Name:
Title:

DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
HAMBRECHT & QUIST LLC
PIPER JAFFRAY, INC.

Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto

By: DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION

By:
Name:
Title:

24

SCHEDULE I

                                                         Number of Firm Shares
Underwriters                                                to be Purchased
------------                                                ---------------
Donaldson, Lufkin & Jenrette Securities
   Corporation

Hambrecht & Quist LLC

Piper Jaffray, Inc.

[Names of other Underwriters]


                                                             ---------------
                                               Total


Annex I

[Insert names of stockholders of the Company who will be required to sign lock ups]

2

EXHIBIT 3.1

CERTIFICATE OF INCORPORATION

OF

SAGENT TECHNOLOGY, INC.

ARTICLE I

The name of this Corporation is Sagent Technology, Inc. (the "Corporation").

ARTICLE II

The address of the Corporation's registered office in the State of Delaware is 1209 Orange Street, City of Wilmington, County of New Castle, Delaware 19801. The name of its registered agent at such address is The Corporation Trust Company.

ARTICLE III

The purpose of this Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of Delaware other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the General Corporation Law of Delaware.

ARTICLE IV

This Corporation is authorized to issue two classes of stock, designated Common Stock, par value $0.001 per share ("Common Stock") and Preferred Stock, par value $0.001 per share ("Preferred Stock"). The number of shares of Common Stock which this Corporation is authorized to issue is 25,000,000. The number of shares of Preferred Stock which this Corporation is authorized to issue is 15,555,555, 2,800,000 of which shall be designated "Series A Preferred," 5,655,555 of which shall be designated "Series B Preferred", 2,800,000 of which shall be designated "Series C Preferred", 1,800,000 of which shall be designated "Series D Preferred", and 2,500,000 of which shall be designated "Series E Preferred" (Series A Preferred, Series B Preferred, Series C Preferred, Series D Preferred and Series E Preferred are referred to collectively as the "Preferred Stock").

The Corporation shall from time to time in accordance with the laws of the State of Delaware increase the authorized amount of its Common Stock if at any time the number of shares of Common Stock remaining unissued and available for issuance shall not be sufficient to permit conversion of the Preferred Stock.


The relative rights, preferences, privileges and restrictions granted to or imposed upon the respective classes of Common Stock and Preferred Stock or the holders thereof are as follows:

SECTION 1. DIVIDENDS.

The holders of the outstanding Preferred Stock shall be entitled to receive, when and as declared by the Board of Directors, out of funds legally available therefor, dividends at the rate of $0.036 per share of Series A Preferred per annum, $0.072 per share of Series B Preferred per annum, $0.20 per share of Series C Preferred per annum, $0.25 per share of Series D Preferred per annum, and $0.43 per share of Series E Preferred per annum, payable in preference and priority to any payment of any dividend on Common Stock of the Corporation. Such dividends shall not be cumulative, and no right to such dividends shall accrue to holders of Preferred Stock or to the holders of Common Stock unless declared by the Board of Directors. No dividends or other distributions shall be made with respect to the Common Stock in any fiscal year, other than dividends payable solely in Common Stock, until a dividend has been paid to or declared and set apart upon all shares of Preferred Stock at the annual rates set forth above during that fiscal year. After the holders of the Preferred Stock have received their dividend preference as set forth above, any dividends declared by the Board of Directors out of funds legally available therefor shall be shared equally among all outstanding shares on an as-converted basis.

(a) For purposes of this Section 1, unless the context otherwise requires, a "distribution" shall mean the transfer of cash or other property without consideration whether by way of dividend or otherwise, payable other than in Common Stock, or the purchase or redemption of shares of the Corporation (other than repurchases of Common Stock issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries upon termination of their employment or services pursuant to agreements providing for the right of said repurchase) for cash or property.

(b) As authorized by Section 402.5(c) of the California Corporations Code, the provisions of Sections 502 and 503 of the California Corporations Code shall not apply with respect to repurchases by the Corporation of shares of Common Stock issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries upon termination of their employment or services pursuant to agreements providing for the right of said repurchase.

SECTION 2. LIQUIDATION PREFERENCE.

In the event of any liquidation, dissolution, or winding up of the Corporation, either voluntary or involuntary, distributions to the shareholders of the Corporation shall be made in the following manner:

(a) The holders of the Series A Preferred shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of the Common Stock by reason of their ownership of such stock, the amount of $0.45 per share for each share of Series A Preferred then held by them (adjusted for any subdivisions, combinations, consoli dations, or stock distributions or stock dividends with respect to such shares effected after the date these Amended and Restated Articles were filed with the Secretary of State) plus an amount equal to all

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declared but unpaid dividends on the Series A Preferred held by them, the holders of the Series B Preferred shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of Common Stock by reason of their ownership of such stock, the amount of $0.90 per share for each share of Series B Preferred then held by them(adjusted for any subdivisions, combinations, consolidations or stock distributions or stock dividends with respect to such shares effected after the date these Amended and Restated Articles were filed with the Secretary of State) plus an amount equal to all declared and unpaid dividends on the Series B Preferred shares then held by them, the holders of the Series C Preferred shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of Common Stock by reason of their ownership of such stock, the amount of $2.50 per share for each share of Series C Preferred then held by them (adjusted for any subdivisions, combinations, consolidations or stock distributions or stock dividends with respect to such shares effected after the date these Amended and Restated Articles were filed with the Secretary of State) plus an amount equal to all declared and unpaid dividends on the Series C Preferred shares then held by them, and the holders of the Series D Preferred shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of Common Stock by reason of their ownership of such stock, the amount of $3.18 per share for each share of Series D Preferred then held by them (adjusted for any subdivisions, combinations, consolidations or stock distributions or stock dividends with respect to such shares effected after the date these Amended and Restated Articles were filed with the Secretary of State) plus an amount equal to all declared and unpaid dividends on the Series D Preferred shares then held by them. The holders of the Series E Preferred shall be entitled to receive, prior and in preference to any distribution of any of the assets or surplus funds of the Corporation to the holders of Common Stock by reason of their ownership of such stock, the amount of $5.40 per share for each share of Series E Preferred then held by them (adjusted for any subdivisions, combinations, consolidations or stock distributions or stock dividends with respect to such shares effected after the date these Amended and Restated Articles were filed with the Secretary of State) plus an amount equal to all declared and unpaid dividends on the Series E Preferred shares then held by them. If the assets and funds thus distri buted among the holders of the Preferred Stock shall be insufficient to permit the payment to such holders of the full aforesaid preferential amount, then the entire assets and funds of the Corporation legally available for distribution shall be distributed ratably among the holders of the Preferred Stock in proportion to the full aforesaid preferential amounts to which each such holder is entitled.

(b) After payment has been made to the holders of the Preferred Stock of the full amounts to which they shall be entitled as set forth in Section 2(a) above, then the entire remaining assets and funds of the Corporation legally available for distribution, if any, shall be distributed ratably among the holders of the Common Stock in a manner such that the amount distributed to each holder of Common Stock shall equal the amount obtained by multiplying the entire remaining assets and funds of the Corporation legally available for distribution hereunder by a fraction, the numerator of which shall be the number of shares of Common Stock then held by such holder, and the denominator of which shall be the total number of shares of Common Stock then outstanding.

(c) For purposes of this Section 2, a merger or consolidation of the Corporation with or into any other corporation or corporations, or a merger of any other corporation or corporations into the Corporation, unless the shareholders of the Corporation immediately following such transaction

-3-

directly or indirectly own greater than fifty percent (50%) of the total voting power of the surviving or acquiring corporation or corporations, or a sale of all or substantially all of the assets of the Corporation, shall be treated as a liquidation, dissolution or winding up of the Corporation.

(d) Notwithstanding Sections 2(a) and 2(b) hereof, the Corporation may at any time, out of funds legally available therefor, repurchase shares of Common Stock of the Corporation issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries upon termination of their employment or services, pursuant to any agreement providing for such right of repurchase.

SECTION 3. CONVERSION.

The holders of the Preferred Stock shall have conversion rights as follows (the "CONVERSION RIGHTS"):

(a) Right to Convert. Each share of Series A Preferred shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for the Series A Preferred, into such number of fully paid and non assessable shares of Common Stock as is determined by dividing $0.45 by the applicable Conversion Price, determined as hereinafter provided, in effect at the time of conversion. Each share of Series B Preferred shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for the Series B Preferred, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $0.90 by the applicable Conversion Price, determined as hereinafter provided, in effect at the time of conversion. Each share of Series C Preferred shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for the Series C Preferred, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $2.50 by the applicable Conversion Price, determined as hereinafter provided, in effect at the time of conversion. Each share of Series D Preferred shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for the Series D Preferred, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $3.18 by the applicable Conversion Price, determined as hereinafter provided, in effect at the time of conversion. Each share of Series E Preferred shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share, at the office of the Corporation or any transfer agent for the Series E Preferred, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing $5.40 by the applicable Conversion Price, determined as hereinafter provided, in effect at the time of conversion. The price at which shares of Common Stock shall be deliverable upon conversion of shares of Preferred Stock (the "Conversion Price") shall initially be $0.45 with respect to the Series A Preferred, $0.90 with respect to the Series B Preferred, $2.50 with respect to the Series C Preferred, $3.18 with respect to the Series D Preferred, and $5.40 with respect to the Series E Preferred per share of Common Stock. Such initial Conversion Price shall be subject to adjustment as hereinafter provided.

-4-

Upon conversion, all declared and unpaid dividends on the Preferred Stock shall be paid either in cash or in shares of Common Stock of the Corporation, at the election of the Company, wherein the shares of Common Stock shall be valued at the fair market value at the time of such conversion, as determined by the Board of Directors of the Corporation.

(b) Automatic Conversion. Each share of Preferred Stock shall automatically be converted into shares of Common Stock at the then effective applicable Conversion Price upon either (i) the closing of a firm commitment underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, covering the offer and sale of Common Stock for the account of the Corporation to the public with gross proceeds to the Company (prior to underwriter commissions and offering expenses) of not less than $10 million, or (ii) the receipt by the Corporation of the affirmative vote at a duly noticed shareholders meeting or pursuant to a duly solicited written consent of the holders of more than sixty-six and two-thirds percent (66 2/3%) of the then out standing shares of Preferred Stock in favor of the conversion of all of the shares of Preferred Stock. In the event of the automatic conversion of the Preferred Stock upon a public offering as set forth in subsection (i) hereof, the person(s) entitled to receive the Common Stock issuable upon such conversion of Preferred Stock shall not be deemed to have converted such Preferred Stock until immediately prior to the closing of such sale of securities.

(c) Mechanics of Conversion. No fractional shares of Common Stock shall be issued upon conversion of Preferred Stock. In lieu of any fractional shares to which the holder would otherwise be entitled, the Corporation shall (after aggregating all shares into which shares of Preferred Stock held by each holder could be converted) pay cash equal to such fraction multiplied by the then-effective Conversion Price. Before any holder of Preferred Stock shall be entitled to convert the same into full shares of Common Stock and to receive certificates therefor, he shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Corporation or of any transfer agent for the Preferred Stock, and shall give written notice to the Corporation at such office that he elects to convert the same; provided, however, that in the event of an automatic conversion pursuant to Section 3(b), the outstanding shares of Preferred Stock shall be converted automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Corporation or its transfer agent, and provided further that the Corporation shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such automatic conversion unless the certificates evidencing such shares of Preferred Stock are either delivered to the Corporation or its transfer agent as provided above, or the holder notifies the Corporation or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the Corporation to indemnify the Corporation from any loss incurred by it in connection with such certificates. The Corporation shall, as soon as practicable after such delivery, or such agreement and indemnification in the case of a lost certificate, issue and deliver at such office to such holder of Preferred Stock, a certificate or certificates for the number of shares of Common Stock to which he shall be entitled as aforesaid and a check payable to the holder in the amount of any cash amounts payable as the result of a conversion into fractional shares of Common Stock. Such conversion shall be deemed to have been made immediately prior to the close of business on the date of such surrender of the shares of Preferred Stock to be converted, or in the case of automatic conversion immediately prior to the closing of the offering or on the effective date of such written consent, and the person or persons entitled to receive

-5-

the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock on such date.

(d) Adjustments to Conversion Price.

(i) Adjustments for Subdivisions, Stock Dividends, Combinations or Consolidations of Common Stock. In the event the Corporation effects a subdivision or combination of its outstanding shares of Common Stock into a greater or smaller number of shares without a proportionate and corresponding subdivision or combination of its outstanding shares of Preferred Stock, then and in each such event the Conversion Price shall be proportionally decreased or increased, respectively.

(ii) Adjustments for Other Dividends and Distributions. In the event the Corporation at any time or from time to time makes, or fixes a record date for the determination of holders of Common Stock entitled to receive, any distribution payable in securities of the Corporation other than shares of Common Stock and other than as otherwise adjusted in this
Section 3, then and in each such event provision shall be made so that the holders of Preferred Stock shall receive upon conversion thereof, in addition to the number of shares of Common Stock receivable thereupon, the amount of securities of the Corporation which they would have received had their shares of Preferred Stock been converted into Common Stock on the date of such event and had they thereafter, during the period from the date of such event to and including the date of conversion, retained such securities receivable by them as aforesaid during such period, subject to all other adjustments called for during such period under this Section 3 with respect to the rights of the holders of the Preferred Stock.

(iii) Adjustments for Reclassification, Exchange and Substitution. If the Common Stock issuable upon conversion of the Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock or other securities or property, whether by capital reorganization, reclassification or otherwise, the Conversion Price then in effect shall, concurrently with the effectiveness of such reorganization or reclassification, be proportionately adjusted such that the Preferred Stock shall be convertible into, in lieu of the number of shares of Common Stock which the holders would otherwise have been entitled to receive, a number of shares of such other class or classes of stock or other securities or property equivalent to the number of shares of Common Stock that would have been subject to receipt by the holders upon conversion of the Preferred Stock immediately before that change and, in any such case, appropriate adjustment (as determined by the Board) shall be made in the application of the provisions herein set forth with respect to the rights and interest thereafter of the holders of the Preferred Stock, to the end that the provisions set forth herein (including provisions with respect to change in and other adjustments of the Conversion Price) shall thereafter be applicable, as nearly as reasonably may be, in relation to any shares of stock or other property thereafter deliverable upon the conversion of the Preferred Stock.

(e) No Impairment. Except as provided in Section 5, the Corporation will not, by amendment of its Articles of Incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by

-6-

the Corporation but will at all times in good faith assist in the carrying out of all the provisions of this Section 3 and in the taking of all such action as may be necessary or appropriate in order to protect the Conversion Rights of the holders of the Preferred Stock against impairment.

(f) Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment of the Conversion Price pursuant to this Section 3, the Corporation at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each holder of Preferred Stock a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the written request at any time of any holder of Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Conversion Price at the time in effect, and (iii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of Preferred Stock.

(g) Notices of Record Date. In the event that this Corporation shall propose at any time:

(i) to declare any dividend or distribution upon its Common Stock, whether in cash, property, stock or other securities, whether or not a regular cash dividend and whether or not out of earnings or earned surplus;

(ii) to offer for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights;

(iii) to effect any reclassification or recapitalization of its Common Stock outstanding involving a change in the Common Stock; or

(iv) to merge or consolidate with or into any other corporation, or sell, lease or convey all or substantially all its property or business, or to liquidate, dissolve or wind up; then, in connection with each such event, this Corporation shall send to the holders of the Preferred Stock:

(1) at least 20 days' prior written notice of the date on which a record shall be taken for such dividend, distribution or subscription rights (and specifying the date on which the holders of Common Stock shall be entitled thereto) or for determining rights to vote in respect of the matters referred to in (iii) and (iv) above; and

(2) in the case of the matters referred to in (iii) and (iv) above, at least 20 days' prior written notice of the date when the same shall take place (and specifying the date on which the holders of Common Stock shall be entitled to exchange their Common Stock for securities or other property deliverable upon the occurrence of such event).

-7-

Each such written notice shall be delivered personally or by messenger or given by express or first class mail, postage prepaid, addressed to the holders of Preferred Stock at the address for each such holder as shown on the books of this Corporation.

SECTION 4. VOTING RIGHTS.

Except as otherwise required by law or by Section 5 hereof, the holder of each share of Common Stock issued and outstanding shall have one vote with respect to such share and the holder of each share of Preferred Stock shall be entitled with respect to such share to a number of votes equal to the number of shares of Common Stock into which such share of Preferred Stock could be converted at the record date for determination of the shareholders entitled to vote on such matters, or, if no such record date is established, at the date such vote is taken or any written consent of shareholders is solicited, such votes to be counted together with all other shares of stock of the Company having general voting power and not separately as a class. Holders of Common Stock and Preferred Stock shall be entitled to notice of any shareholders' meeting in accordance with the Bylaws of the Corporation. Fractional votes by the holders of Preferred Stock shall not, however, be permitted and any fractional voting rights shall (after aggregating all shares into which shares of Preferred Stock held by each holder could be converted) be rounded to the nearest whole number.

SECTION 5. COVENANTS.

In addition to any other rights provided by law, so long as any Preferred Stock shall be outstanding, this Corporation shall not, without first obtaining the affirmative vote or written consent of the holders of not less than a majority of such outstanding shares of Preferred Stock, voting together as a single class:

(a) amend or repeal any provision of, or add any provision to, this Corporation's Amended and Restated Articles of Incorporation if such action would materially and adversely alter or change the preferences, rights, privileges or powers of, or the restrictions provided for the benefit of, any Preferred Stock;

(b) authorize, issue or obligate itself to issue shares of any class of stock or any other security convertible into or exchangeable for shares of any class of stock having any preference or priority as to dividends or assets superior to or on a parity with any such preference or priority of any Preferred Stock;

(c) reclassify any Common Stock or any other shares of this Corporation other than the Preferred Stock into shares having any preference or priority as to dividends or assets superior to or on a parity with any such preference or priority of the Preferred Stock;

(d) increase the authorized number of shares of Preferred Stock; or

-8-

(e) authorize a liquidation, dissolution, recapitalization or reorganization of the Corporation, or a sale or transfer of all or substantially all of the assets of the Corporation or a merger or consolidation of the Corporation if, as a result of such merger or consolidation, the shareholders of the Corporation shall own less than 50% of the voting securities of the surviving corporation.

SECTION 6. NO REISSUANCE OF PREFERRED STOCK.
No share or shares of Preferred Stock acquired by this Corporation by reason of redemption, purchase, conversion or otherwise shall be reissued, and all such shares shall be canceled, retired and eliminated from the shares which the Corporation shall be authorized to issue.

ARTICLE V

SECTION 1. LIMITATION OF DIRECTOR'S LIABILITY.

The liability of the directors of this Corporation for monetary damages shall be eliminated to the fullest extent permissible under California law.

SECTION 2. INDEMNIFICATION OF CORPORATE AGENTS.

This Corporation is authorized to provide indemnification of agents (as defined in Section 317 of the California Corporations Code) through Bylaw provisions, agreements with agents, vote of shareholders or disinterested directors, or otherwise, to the fullest extent permissible under California law.

SECTION 3. REPEAL OR MODIFICATION.

Any amendment, repeal or modification of the foregoing provisions of this Article IV shall not adversely affect any right of indemnification or limitation of liability of an agent of this Corporation relating to acts or omissions occurring prior to such amendment, repeal or modification.

ARTICLE VI

The name and mailing address of the incorporator are as follows:

Deborah Chang 650 Page Mill Road Palo Alto, CA 94303-1050

The undersigned incorporator hereby acknowledges that the above Certificate of Incorporation of Sagent Technology, Inc. is her act and deed and that the facts stated therein are true.

Dated: September 4, 1998                                 /s/  Deborah Chang
                                                         ---------------------
                                                         Deborah Chang

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EXHIBIT 3.3

BYLAWS

OF

SAGENT TECHNOLOGY, INC

(a Delaware Corporation)

TABLE OF CONTENTS

                                                                                                                   Page
                                                                                                                   ----
ARTICLE I - CORPORATE OFFICES........................................................................................1

         1.1       REGISTERED OFFICE.................................................................................1
         1.2       OTHER OFFICES.....................................................................................1

ARTICLE II - MEETINGS OF STOCKHOLDERS................................................................................1

         2.1       PLACE OF MEETINGS.................................................................................1
         2.2       ANNUAL MEETING....................................................................................1
         2.3       SPECIAL MEETING...................................................................................2
         2.4       NOTICE OF STOCKHOLDERS' MEETINGS..................................................................2
         2.5       ADVANCE NOTICE OF STOCKHOLDER NOMINEES AND STOCKHOLDER
                   BUSINESS..........................................................................................2
         2.6       MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE......................................................3
         2.7       QUORUM............................................................................................4
         2.8       ADJOURNED MEETING; NOTICE.........................................................................4
         2.9       VOTING............................................................................................4
         2.10      WAIVER OF NOTICE..................................................................................5
         2.11      RECORD DATE FOR STOCKHOLDER NOTICE; VOTING........................................................5
         2.12      PROXIES...........................................................................................5
         2.13      ORGANIZATION......................................................................................6
         2.14      LIST OF STOCKHOLDERS ENTITLED TO VOTE.............................................................6

ARTICLE III - DIRECTORS..............................................................................................6

         3.1       POWERS............................................................................................6
         3.2       NUMBER OF DIRECTORS...............................................................................6
         3.3       ELECTION AND TERM OF OFFICE OF DIRECTORS..........................................................7
         3.4       RESIGNATION AND VACANCIES.........................................................................7
         3.5       PLACE OF MEETINGS; MEETINGS BY TELEPHONE..........................................................7
         3.6       REGULAR MEETINGS..................................................................................7
         3.7       SPECIAL MEETINGS; NOTICE..........................................................................8
         3.8       QUORUM............................................................................................8
         3.9       WAIVER OF NOTICE..................................................................................8
         3.10      ADJOURNMENT.......................................................................................8

-i-

TABLE OF CONTENTS

(Continued)

                                                                                                                   Page
                                                                                                                   ----
         3.11      NOTICE OF ADJOURNMENT.............................................................................9
         3.12      BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING.................................................9
         3.13      FEES AND COMPENSATION OF DIRECTORS................................................................9
         3.14      APPROVAL OF LOANS TO OFFICERS.....................................................................9

ARTICLE IV - COMMITTEES.............................................................................................10

         4.1       COMMITTEES OF DIRECTORS..........................................................................10
         4.2       MEETINGS AND ACTION OF COMMITTEES................................................................10
         4.3       COMMITTEE MINUTES................................................................................11

ARTICLE V - OFFICERS................................................................................................11

         5.1       OFFICERS.........................................................................................11
         5.2       ELECTION OF OFFICERS.............................................................................11
         5.3       SUBORDINATE OFFICERS.............................................................................11
         5.4       REMOVAL AND RESIGNATION OF OFFICERS..............................................................12
         5.5       VACANCIES IN OFFICES.............................................................................12
         5.6       CHAIRMAN OF THE BOARD............................................................................12
         5.7       PRESIDENT........................................................................................12
         5.8       VICE PRESIDENTS..................................................................................12
         5.9       SECRETARY........................................................................................13
         5.10      CHIEF FINANCIAL OFFICER..........................................................................13

ARTICLE VI - INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND
         OTHER AGENTS...............................................................................................14

         6.1       INDEMNIFICATION OF DIRECTORS AND OFFICERS........................................................14
         6.2       INDEMNIFICATION OF OTHERS........................................................................15
         6.3       INSURANCE........................................................................................15

ARTICLE VII - RECORDS AND REPORTS...................................................................................15

         7.1       MAINTENANCE AND INSPECTION OF RECORDS............................................................15
         7.2       INSPECTION BY DIRECTORS..........................................................................16
         7.3       ANNUAL STATEMENT TO STOCKHOLDERS.................................................................16
         7.4       REPRESENTATION OF SHARES OF OTHER CORPORATIONS...................................................16
         7.5       CERTIFICATION AND INSPECTION OF BYLAWS...........................................................16

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TABLE OF CONTENTS

(Continued)

                                                                                                                  Page
                                                                                                                  ----
ARTICLE VIII - GENERAL MATTERS......................................................................................16

         8.1       RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING............................................16
         8.2       CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS........................................................17
         8.3       CORPORATE CONTRACTS AND INSTRUMENTS:  HOW EXECUTED...............................................17
         8.4       STOCK CERTIFICATES; TRANSFER; PARTLY PAID SHARES.................................................17
         8.5       SPECIAL DESIGNATION ON CERTIFICATES..............................................................18
         8.6       LOST CERTIFICATES................................................................................18
         8.7       TRANSFER AGENTS AND REGISTRARS...................................................................19
         8.8       CONSTRUCTION; DEFINITIONS........................................................................19

ARTICLE IX - AMENDMENTS.............................................................................................19
         9.1       AMENDMENTS BY STOCKHOLDERS AND DIRECTORS.........................................................19
         9.2       SUPERMAJORITY VOTE...............................................................................19

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BYLAWS

OF

SAGENT TECHNOLOGY, INC.

(a Delaware Corporation)

ARTICLE I

CORPORATE OFFICES

1.1 REGISTERED OFFICE

The registered office of the corporation shall be fixed in the certificate of incorporation of the corporation.

1.2 OTHER OFFICES

The board of directors may at any time establish branch or subordinate offices at any place or places where the corporation is qualified to do business.

ARTICLE II

MEETINGS OF STOCKHOLDERS

2.1 PLACE OF MEETINGS

Meetings of stockholders shall be held at any place within or outside the State of Delaware designated by the board of directors. In the absence of any such designation, stockholders' meetings shall be held at the principal executive office of the corporation.

2.2 ANNUAL MEETING

The annual meeting of stockholders shall be held each year on a date and at a time designated by the board of directors. In the absence of such designation, the annual meeting of stockholders shall be held on the third Tuesday of May in each year at 10:00 a.m. However, if such day falls on a legal holiday, then the meeting shall be held at the same time and place on the next succeeding full business day. At the meeting, directors shall be elected, and any other proper business may be transacted.


2.3 SPECIAL MEETING

Except as otherwise required by law, a special meeting of the stockholders may be called only by the Board of Directors, the Chairman of the Board, or the President; provided however, that if at any time no directors remain in office, then a special meeting for the purpose of electing directors may be called in accordance with the procedure set forth in the Bylaws. No business may be transacted at such special meeting otherwise than as specified in the notice of such meeting.

2.4 NOTICE OF STOCKHOLDERS' MEETINGS

All notices of meetings of stockholders shall be sent or otherwise given in accordance with Section 2.6 of these bylaws not less than ten (10) nor more than sixty (60) days before the date of the meeting. The notice shall specify the place, date and hour of the meeting and (i) in the case of a special meeting, the purpose or purposes for which the meeting is called (no business other than that specified in the notice may be transacted) or (ii) in the case of the annual meeting, those matters which the board of directors, at the time of giving the notice, intends to present for action by the stockholders (but any proper matter may be presented at the meeting for such action). The notice of any meeting at which directors are to be elected shall include the name of any nominee or nominees who, at the time of the notice, the board intends to present for election.

2.5 ADVANCE NOTICE OF STOCKHOLDER NOMINEES AND STOCKHOLDER BUSINESS

Subject to the rights of holders of any class or series of stock having a preference over the Common Stock as to dividends or upon liquidation,

(a) nominations for the election of directors, and

(b) business proposed to be brought before any stockholder meeting

may be made by the board of directors or proxy committee appointed by the board of directors or by any stockholder entitled to vote in the election of directors generally if such nomination or business proposed is otherwise proper business before such meeting. However, any such stockholder may nominate one or more persons for election as directors at a meeting or propose business to be brought before a meeting, or both, only if such stockholder has given timely notice to the secretary of the corporation in proper written form of their intent to make such nomination or nominations or to propose such business. To be timely, such stockholder's notice must be delivered to or mailed and received at the principal executive offices of the corporation not less than one hundred twenty
(120) calendar days in advance of the date of the corporation's proxy statement released to stockholders in connection with the previous year's annual meeting of stockholders; provided, however, that in the event that no annual meeting was held in the previous year or the date of the annual meeting has been changed by more than thirty (30) days from the date contemplated at the time of the previous year's proxy statement, notice by the stockholder to be timely must be so received a reasonable time

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before the solicitation is made. To be in proper form, a stockholder's notice to the secretary shall set forth:

(i) the name and address of the stockholder who intends to make the nominations or propose the business and, as the case may be, of the person or persons to be nominated or of the business to be proposed;

(ii) a representation that the stockholder is a holder of record of stock of the corporation entitled to vote at such meeting and, if applicable, intends to appear in person or by proxy at the meeting to nominate the person or persons specified in the notice;

(iii) if applicable, a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nomination or nominations are to be made by the stockholder;

(iv) such other information regarding each nominee or each matter of business to be proposed by such stockholder as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had the nominee been nominated, or intended to be nominated, or the matter been proposed, or intended to be proposed by the board of directors; and

(v) if applicable, the consent of each nominee to serve as director of the corporation if so elected.

The chairman of the meeting shall refuse to acknowledge the nomination of any person or the proposal of any business not made in compliance with the foregoing procedure.

2.6 MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE

Written notice of any meeting of stockholders shall be given either personally or by first-class mail or by telegraphic or other written communication. Notices not personally delivered shall be sent charges prepaid and shall be addressed to the stockholder at the address of that stockholder appearing on the books of the corporation or given by the stockholder to the corporation for the purpose of notice. Notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by telegram or other means of written communication.

An affidavit of the mailing or other means of giving any notice of any stockholders' meeting, executed by the secretary, assistant secretary or any transfer agent of the corporation giving the notice, shall be prima facie evidence of the giving of such notice.

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2.7 QUORUM

The holders of a majority in voting power of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute or by the certificate of incorporation. If, however, such quorum is not present or represented at any meeting of the stockholders, then either (i) the chairman of the meeting or (ii) the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting in accordance with Section 2.7 of these bylaws.

When a quorum is present at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall decide any question brought before such meeting, unless the question is one upon which, by express provision of the laws of the State of Delaware or of the certificate of incorporation or these bylaws, a different vote is required, in which case such express provision shall govern and control the decision of the question.

If a quorum be initially present, the stockholders may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum, if any action taken is approved by a majority of the stockholders initially constituting the quorum.

2.8 ADJOURNED MEETING; NOTICE

When a meeting is adjourned to another time and place, unless these bylaws otherwise require, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business that might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

2.9 VOTING

The stockholders entitled to vote at any meeting of stockholders shall be determined in accordance with the provisions of Section 2.11 of these bylaws, subject to the provisions of Sections 217 and 218 of the General Corporation Law of Delaware (relating to voting rights of fiduciaries, pledgors and joint owners, and to voting trusts and other voting agreements).

Except as may be otherwise provided in the certificate of incorporation or these bylaws, each stockholder shall be entitled to one vote for each share of capital stock held by such stockholder with respect to any matter submitted to a vote of the stockholders and stockholders shall not be entitled to cumulate their votes in the election of directors.

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2.10 WAIVER OF NOTICE

Whenever notice is required to be given under any provision of the General Corporation Law of Delaware or of the certificate of incorporation or these bylaws, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice unless so required by the certificate of incorporation or these bylaws.

2.11 RECORD DATE FOR STOCKHOLDER NOTICE; VOTING

For purposes of determining the stockholders entitled to notice of any meeting or to vote thereat, the board of directors may fix, in advance, a record date, which shall not precede the date upon which the resolution fixing the record date is adopted by the board of directors and which shall not be more than sixty (60) days nor less than ten (10) days before the date of any such meeting, and in such event only stockholders of record on the date so fixed are entitled to notice and to vote, notwithstanding any transfer of any shares on the books of the corporation after the record date.

If the board of directors does not so fix a record date, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the business day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held.

A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting unless the board of directors fixes a new record date for the adjourned meeting, but the board of directors shall fix a new record date if the meeting is adjourned for more than thirty (30) days from the date set for the original meeting.

The record date for any other purpose shall be as provided in Section 8.1 of these bylaws.

2.12 PROXIES

Every person entitled to vote for directors, or on any other matter, shall have the right to do so either in person or by one or more agents authorized by a written proxy signed by the person and filed with the secretary of the corporation, but no such proxy shall be voted or acted upon after three
(3) years from its date unless the proxy provides for a longer period. A proxy shall be deemed signed if the stockholder's name is placed on the proxy (whether by manual signature, typewriting, telegraphic transmission, telefacsimile or otherwise) by the stockholder or the stockholder's attorney-in-fact. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Section 212(e) of the General Corporation Law of Delaware.

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2.13 ORGANIZATION

The president, or in the absence of the president, the chairman of the board, or, in the absence of the president and the chairman of the board, one of the corporation's vice presidents, shall call the meeting of the stockholders to order, and shall act as chairman of the meeting. In the absence of the president, the chairman of the board, and all of the vice presidents, the stockholders shall appoint a chairman for such meeting. The chairman of any meeting of stockholders shall determine the order of business and the procedures at the meeting, including such matters as the regulation of the manner of voting and the conduct of business. The secretary of the corporation shall act as secretary of all meetings of the stockholders, but in the absence of the secretary at any meeting of the stockholders, the chairman of the meeting may appoint any person to act as secretary of the meeting.

2.14 LIST OF STOCKHOLDERS ENTITLED TO VOTE

The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.

ARTICLE III

DIRECTORS

3.1 POWERS

Subject to the provisions of the General Corporation Law of Delaware and any limitations in the certificate of incorporation and these bylaws relating to action required to be approved by the stockholders or by the outstanding shares, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the board of directors.

3.2 NUMBER OF DIRECTORS

The board of directors shall consist of six members. The board of directors may increase or decrease the number of directors constituting the board of directors upon the approval of a majority of the directors then in office. The number of directors so determined shall be the

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authorized number of directors of the corporation. No reduction of the authorized number of directors shall have the effect of removing any director before that director's term of office expires.

3.3 ELECTION AND TERM OF OFFICE OF DIRECTORS

Except as provided in Section 3.4 of these bylaws, directors shall be elected at each annual meeting of stockholders to hold office until the next annual meeting. Each director, including a director elected or appointed to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified.

3.4 RESIGNATION AND VACANCIES

Any director may resign effective on giving written notice to the chairman of the board, the president, the secretary or the board of directors, unless the notice specifies a later time for that resignation to become effective. If the resignation of a director is effective at a future time, the board of directors may elect a successor to take office when the resignation becomes effective.

All vacancies in the board of directors may be filled by a majority of the remaining directors, even if less than a quorum, or by a sole remaining director; provided, that whenever the holders of any class or classes of stock or series thereof are entitled to elect one or more directors by the provisions of the certificate of incorporation, vacancies and newly created directorships of such class or classes or series may be filled by a majority of the directors elected by such class or classes or series thereof then in office, or by a sole remaining director so elected.

3.5 PLACE OF MEETINGS; MEETINGS BY TELEPHONE

Regular meetings of the board of directors may be held at any place within or outside the State of Delaware that has been designated from time to time by resolution of the board. In the absence of such a designation, regular meetings shall be held at the principal executive office of the corporation. Special meetings of the board may be held at any place within or outside the State of Delaware that has been designated in the notice of the meeting or, if not stated in the notice or if there is no notice, at the principal executive office of the corporation.

Any meeting, regular or special, may be held by conference telephone or similar communication equipment, so long as all directors participating in the meeting can hear one another; and all such directors shall be deemed to be present in person at the meeting.

3.6 REGULAR MEETINGS

Regular meetings of the board of directors may be held without notice if the times of such meetings are fixed by the board of directors. If any regular meeting day shall fall on a legal holiday, then the meeting shall be held next succeeding full business day.

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3.7 SPECIAL MEETINGS; NOTICE

Special meetings of the board of directors for any purpose or purposes may be called at any time by the chairman of the board, the president, any vice president, the secretary or any two directors.

Notice of the time and place of special meetings shall be delivered personally or by telephone to each director or sent by first-class mail or telegram, charges prepaid, addressed to each director at that director's address as it is shown on the records of the corporation. If the notice is mailed, it shall be deposited in the United States mail at least four (4) days before the time of the holding of the meeting. If the notice is delivered personally or by telephone or telegram, it shall be delivered personally or by telephone or to the telegraph company at least forty-eight (48) hours before the time of the holding of the meeting. Any oral notice given personally or by telephone may be communicated either to the director or to a person at the office of the director who the person giving the notice has reason to believe will promptly communicate it to the director. The notice need not specify the purpose or the place of the meeting, if the meeting is to be held at the principal executive office of the corporation.

3.8 QUORUM

A majority of the authorized number of directors shall constitute a quorum for the transaction of business, except to adjourn as provided in Section 3.10 of these bylaws. Every act or decision done or made by a majority of the directors present at a duly held meeting at which a quorum is present shall be regarded as the act of the board of directors, subject to the provisions of the certificate of incorporation and other applicable law.

A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for that meeting.

3.9 WAIVER OF NOTICE

Notice of a meeting need not be given to any director (i) who signs a waiver of notice or a consent to holding the meeting or an approval of the minutes thereof, whether before or after the meeting, or (ii) who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to such directors. All such waivers, consents, and approvals shall be filed with the corporate records or made part of the minutes of the meeting. A waiver of notice need not specify the purpose of any regular or special meeting of the board of directors.

3.10 ADJOURNMENT

A majority of the directors present, whether or not constituting a quorum, may adjourn any meeting to another time and place.

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3.11 NOTICE OF ADJOURNMENT

Notice of the time and place of holding an adjourned meeting need not be given unless the meeting is adjourned for more than twenty-four (24) hours. If the meeting is adjourned for more than twenty-four (24) hours, then notice of the time and place of the adjourned meeting shall be given before the adjourned meeting takes place, in the manner specified in Section 3.7 of these bylaws, to the directors who were not present at the time of the adjournment.

3.12 BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING

Any action required or permitted to be taken by the board of directors may be taken without a meeting, provided that all members of the board individually or collectively consent in writing to that action. Such action by written consent shall have the same force and effect as a unanimous vote of the board of directors. Such written consent and any counterparts thereof shall be filed with the minutes of the proceedings of the board.

3.13 FEES AND COMPENSATION OF DIRECTORS

Directors and members of committees may receive such compensation, if any, for their services and such reimbursement of expenses as may be fixed or determined by resolution of the board of directors. This Section 3.13 shall not be construed to preclude any director from serving the corporation in any other capacity as an officer, agent, employee or otherwise and receiving compensation for those services.

3.14 APPROVAL OF LOANS TO OFFICERS

The corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other employee of the corporation or any of its subsidiaries, including any officer or employee who is a director of the corporation or any of its subsidiaries, whenever, in the judgment of the directors, such loan, guaranty or assistance may reasonably be expected to benefit the corporation. The loan, guaranty or other assistance may be with or without interest and may be unsecured, or secured in such manner as the board of directors shall approve, including, without limitation, a pledge of shares of stock of the corporation. Nothing contained in this section shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the corporation at common law or under any statute.

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ARTICLE IV

COMMITTEES

4.1 COMMITTEES OF DIRECTORS

The board of directors may, by resolution adopted by a majority of the authorized number of directors, designate one (1) or more committees, each consisting of two or more directors, to serve at the pleasure of the board. The board may designate one (1) or more directors as alternate members of any committee, who may replace any absent member at any meeting of the committee. The appointment of members or alternate members of a committee requires the vote of a majority of the authorized number of directors. Any committee, to the extent provided in the resolution of the board, shall have and may exercise all the powers and authority of the board, but no such committee shall have the power of authority to:

(a) amend the certificate of incorporation (except that a committee may, to the extent authorized in the resolution or resolutions providing for the issuance of shares of stock adopted by the board of directors as provided in Section 151(a) of the General Corporation Law of Delaware, fix the designations and any of the preferences or rights of such shares relating to dividends, redemption, dissolution, any distribution of assets of the corporation or the conversion into, or the exchange of such shares for, shares of any other class or classes or any other series of the same or any other class or classes of stock of the corporation);

(b) adopt an agreement of merger or consolidation under Sections 251 or 252 of the General Corporation Law of Delaware;

(c) recommend to the stockholders the sale, lease or exchange of all or substantially all of the corporation's property and assets;

(d) recommend to the stockholders a dissolution of the corporation or a revocation of a dissolution; or

(e) amend the bylaws of the corporation; and, unless the board resolution estab lishing the committee, the bylaws or the certificate of incorporation expressly so provide, no such committee shall have the power or authority to declare a dividend, to authorize the issuance of stock, or to adopt a certificate of ownership and merger pursuant to Section 253 of the General Corporation Law of Delaware.

4.2 MEETINGS AND ACTION OF COMMITTEES

Meetings and actions of committees shall be governed by, and held and taken in accordance with, the provisions of Article III of these bylaws, Section
3.5 (place of meetings), Section 3.6 (regular meetings), Section 3.7 (special meetings and notice), Section 3.8 (quorum), Section 3.9

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(waiver of notice), Section 3.10 (adjournment), Section 3.11 (notice of adjournment), and Section 3.12 (action without meeting), with such changes in the context of those bylaws as are necessary to substitute the committee and its members for the board of directors and its members; provided, however, that the time of regular meetings of committees may be determined either by resolution of the board of directors or by resolution of the committee, that special meetings of committees may also be called by resolution of the board of directors, and that notice of special meetings of committees shall also be given to all alternate members, who shall have the right to attend all meetings of the committee. The board of directors may adopt rules for the government of any committee not inconsistent with the provisions of these bylaws.

4.3 COMMITTEE MINUTES.

Each committee shall keep regular minutes of its meetings and report the same to the board of directors when required.

ARTICLE V

OFFICERS

5.1 OFFICERS

The officers of the corporation shall be a president, a secretary, and a chief financial officer. The corporation may also have, at the discretion of the board of directors, a chairman of the board, one or more vice presidents, one or more assistant secretaries, one or more assistant treasurers, and such other officers as may be appointed in accordance with the provisions of Section 5.3 of these bylaws. Any number of offices may be held by the same person.

5.2 ELECTION OF OFFICERS

The officers of the corporation, except such officers as may be appointed in accordance with the provisions of Section 5.3 or Section 5.5 of these bylaws, shall be chosen by the board, subject to the rights, if any, of an officer under any contract of employment.

5.3 SUBORDINATE OFFICERS

The board of directors may appoint, or may empower the president to appoint, such other officers as the business of the corporation may require, each of whom shall hold office for such period, have such authority, and perform such duties as are provided in these bylaws or as the board of directors may from time to time determine.

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5.4 REMOVAL AND RESIGNATION OF OFFICERS

Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by the board of directors at any regular or special meeting of the board or, except in case of an officer chosen by the board of directors, by any officer upon whom such power of removal may be conferred by the board of directors.

Any officer may resign at any time by giving written notice to the corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice; and, unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party.

5.5 VACANCIES IN OFFICES

A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in these bylaws for regular appointments to that office.

5.6 CHAIRMAN OF THE BOARD

The chairman of the board, if such an officer be elected, shall, if present, preside at meetings of the board of directors and exercise and perform such other powers and duties as may from time to time be assigned to him by the board of directors or as may be prescribed by these bylaws. If there is no president, then the chairman of the board shall also be the chief executive officer of the cor poration and shall have the powers and duties prescribed in
Section 5.7 of these bylaws.

5.7 PRESIDENT

Subject to such supervisory powers, if any, as may be given by the board of directors to the chairman of the board, if there be such an officer, the president shall be the chief executive officer of the corporation and shall, subject to the control of the board of directors, have general supervision, direction, and control of the business and the officers of the corporation. He shall preside at all meetings of the stockholders and, in the absence or nonexistence of a chairman of the board, at all meetings of the board of directors. He shall have the general powers and duties of management usually vested in the office of president of a corporation, and shall have such other powers and duties as may be prescribed by the board of directors or these bylaws.

5.8 VICE PRESIDENTS

In the absence or disability of the president, the vice presidents, if any, in order of their rank as fixed by the board of directors or, if not ranked, a vice president designated by the board of directors, shall perform all the duties of the president and when so acting shall have all the powers of, and be subject to all the restrictions upon, the president. The vice presidents shall have such

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other powers and perform such other duties as from time to time may be prescribed for them respectively by the board of directors, these bylaws, the president or the chairman of the board.

5.9 SECRETARY

The secretary shall keep or cause to be kept, at the principal executive office of the corporation or such other place as the board of directors may direct, a book of minutes of all meetings and actions of directors, committees of directors and stockholders. The minutes shall show the time and place of each meeting, whether regular or special (and, if special, how authorized and the notice given), the names of those present at directors' meetings or committee meetings, the number of shares present or represented at stockholders' meetings, and the proceedings thereof.

The secretary shall keep, or cause to be kept, at the principal executive office of the corporation or at the office of the corporation's transfer agent or registrar, as determined by resolu tion of the board of directors, a share register, or a duplicate share register, showing the names of all stockholders and their addresses, the number and classes of shares held by each, the number and date of certificates evidencing such shares, and the number and date of cancellation of every certificate surrendered for cancellation.

The secretary shall give, or cause to be given, notice of all meetings of the stockholders and of the board of directors required to be given by law or by these bylaws. He shall keep the seal of the corporation, if one be adopted, in safe custody and shall have such other powers and perform such other duties as may be prescribed by the board of directors or by these bylaws.

5.10 CHIEF FINANCIAL OFFICER

The chief financial officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, retained earnings, and shares. The books of account shall at all reasonable times be open to in spection by any director.

The chief financial officer shall deposit all money and other valuables in the name and to the credit of the corporation with such depositaries as may be designated by the board of directors. He shall disburse the funds of the corporation as may be ordered by the board of directors, shall render to the president and directors, whenever they request it, an account of all of his transactions as chief financial officer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the board of directors or these bylaws.

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ARTICLE VI

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES,
AND OTHER AGENTS

6.1 INDEMNIFICATION OF DIRECTORS AND OFFICERS

The corporation shall, to the maximum extent and in the manner permitted by the General Corporation Law of Delaware as the same now exists or may hereafter be amended, indemnify any person against expenses (including attorneys' fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred in connection with any threatened, pending or completed action, suit, or proceeding in which such person was or is a party or is threatened to be made a party by reason of the fact that such person is or was a director or officer of the corporation. For purposes of this Section 6.1, a "director" or "officer" of the corporation shall mean any person (i) who is or was a director or officer of the corporation, (ii) who is or was serving at the request of the corporation as a director or officer of another corporation, partnership, joint venture, trust or other enterprise, or (iii) who was a director or officer of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

The corporation shall be required to indemnify a director or officer in connection with an action, suit, or proceeding (or part thereof) initiated by such director or officer only if the initiation of such action, suit, or proceeding (or part thereof) by the director or officer was authorized by the Board of Directors of the corporation.

The corporation shall pay the expenses (including attorney's fees) incurred by a director or officer of the corporation entitled to indemnification hereunder in defending any action, suit or proceeding referred to in this
Section 6.1 in advance of its final disposition; provided, however, that payment of expenses incurred by a director or officer of the corporation in advance of the final disposition of such action, suit or proceeding shall be made only upon receipt of an undertaking by the director or officer to repay all amounts advanced if it should ultimately be determined that the director of officer is not entitled to be indemnified under this Section 6.1 or otherwise.

The rights conferred on any person by this Article shall not be exclusive of any other rights which such person may have or hereafter acquire under any statute, provision of the corporation's Certificate of Incorporation, these bylaws, agreement, vote of the stockholders or disinterested directors or otherwise.

Any repeal or modification of the foregoing provisions of this Article shall not adversely affect any right or protection hereunder of any person in respect of any act or omission occurring prior to the time of such repeal or modification.

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6.2 INDEMNIFICATION OF OTHERS

The corporation shall have the power, to the maximum extent and in the manner permitted by the General Corporation Law of Delaware as the same now exists or may hereafter be amended, to indemnify any person (other than directors and officers) against expenses (including attorneys' fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred in connection with any threatened, pending or completed action, suit, or proceeding, in which such person was or is a party or is threatened to be made a party by reason of the fact that such person is or was an employee or agent of the corporation. For purposes of this Section 6.2, an "employee" or "agent" of the corporation (other than a director or officer) shall mean any person (i) who is or was an employee or agent of the corporation, (ii) who is or was serving at the request of the corporation as an employee or agent of another corporation, partnership, joint venture, trust or other enterprise, or (iii) who was an employee or agent of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

6.3 INSURANCE

The corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him or her and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the corporation would have the power to indemnify him or her against such liability under the provisions of the General Corporation Law of Delaware.

ARTICLE VII

RECORDS AND REPORTS

7.1 MAINTENANCE AND INSPECTION OF RECORDS

The corporation shall, either at its principal executive office or at such place or places as designated by the board of directors, keep a record of its stockholders listing their names and addresses and the number and class of shares held by each stockholder, a copy of these bylaws as amended to date, accounting books and other records of its business and properties.

Any stockholder of record, in person or by attorney or other agent, shall, upon written demand under oath stating the purpose thereof, have the right during the usual hours for business to inspect for any proper purpose the corporation's stock ledger, a list of its stockholders, and its other books and records and to make copies or extracts therefrom. A proper purpose shall mean a purpose reasonably related to such person's interest as a stockholder. In every instance where an attorney or other agent is the person who seeks the right to inspection, the demand under oath shall be

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accompanied by a power of attorney or such other writing that authorizes the attorney or other agent to so act on behalf of the stockholder. The demand under oath shall be directed to the corporation at its registered office in Delaware or at its principal place of business.

7.2 INSPECTION BY DIRECTORS

Any director shall have the right to examine (and to make copies of) the corporation's stock ledger, a list of its stockholders and its other books and records for a purpose reasonably related to his or her position as a director.

7.3 ANNUAL STATEMENT TO STOCKHOLDERS

The board of directors shall present at each annual meeting, and at any special meeting of the stockholders when called for by vote of the stockholders, a full and clear statement of the business and condition of the corporation.

7.4 REPRESENTATION OF SHARES OF OTHER CORPORATIONS

The chairman of the board, if any, the president, any vice president, the chief financial officer, the secretary or any assistant secretary of this corporation, or any other person authorized by the board of directors or the president or a vice president, is authorized to vote, represent and exercise on behalf of this corporation all rights incident to any and all shares of the stock of any other corporation or corporations standing in the name of this corporation. The authority herein granted may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.

7.5 CERTIFICATION AND INSPECTION OF BYLAWS

The original or a copy of these bylaws, as amended or otherwise altered to date, certified by the secretary, shall be kept at the corporation's principal executive office and shall be open to inspection by the stockholders of the corporation, at all reasonable times during office hours.

ARTICLE VIII

GENERAL MATTERS

8.1 RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING

For purposes of determining the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any other lawful action, the board of directors may fix, in advance, a record date, which shall not be more than sixty (60) days before any such action. In that case, only stockholders of

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record at the close of business on the date so fixed are entitled to receive the dividend, distribution or allotment of rights, or to exercise such rights, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date so fixed, except as otherwise provided in the General Corporation Law of Delaware.

If the board of directors does not so fix a record date, then the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the board adopts the applicable resolution.

8.2 CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS

From time to time, the board of directors shall determine by resolution which person or persons may sign or endorse all checks, drafts, other orders for payment of money, notes or other evidences of indebtedness that are issued in the name of or payable to the corporation, and only the persons so authorized shall sign or endorse those instruments.

8.3 CORPORATE CONTRACTS AND INSTRUMENTS: HOW EXECUTED

The board of directors, except as otherwise provided in these bylaws, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the corporation; such authority may be general or confined to specific instances. Unless so authorized or ratified by the board of directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

8.4 STOCK CERTIFICATES; TRANSFER; PARTLY PAID SHARES

The shares of the corporation shall be represented by certificates, provided that the board of directors of the corporation may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the corporation. Notwithstanding the adoption of such a resolution by the board of directors, every holder of stock represented by certificates and, upon request, every holder of uncertificated shares, shall be entitled to have a certificate signed by, or in the name of the corporation by, the chairman or vice-chairman of the board of directors, or the president or vice-president, and by the treasurer or an assistant treasurer, or the secretary or an assistant secretary of such corporation representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.

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Certificates for shares shall be of such form and device as the board of directors may designate and shall state the name of the record holder of the shares represented thereby; its number; date of issuance; the number of shares for which it is issued; a summary statement or reference to the powers, designations, preferences or other special rights of such stock and the qualifications, limitations or restrictions of such preferences and/or rights, if any; a statement or summary of liens, if any; a conspicuous notice of restrictions upon transfer or registration of transfer, if any; a statement as to any applicable voting trust agreement; if the shares be assessable, or, if assessments are collectible by personal action, a plain statement of such facts.

Upon surrender to the secretary or transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books.

The corporation may issue the whole or any part of its shares as partly paid and subject to call for the remainder of the consideration to be paid therefor. Upon the face or back of each stock certificate issued to represent any such partly paid shares, or upon the books and records of the corporation in the case of uncertificated partly paid shares, the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated. Upon the declaration of any dividend on fully paid shares, the corporation shall declare a dividend upon partly paid shares of the same class, but only upon the basis of the percentage of the consideration actually paid thereon.

8.5 SPECIAL DESIGNATION ON CERTIFICATES

If the corporation is authorized to issue more than one class of stock or more than one series of any class, then the powers, the designations, the preferences and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or summarized on the face or back of the certificate that the corporation shall issue to represent such class or series of stock; provided, however, that, except as otherwise provided in Section 202 of the General Corporation Law of Delaware, in lieu of the foregoing requirements there may be set forth on the face or back of the certificate that the corporation shall issue to represent such class or series of stock a statement that the corporation will furnish without charge to each stockholder who so requests the powers, the designations, the preferences and the relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.

8.6 LOST CERTIFICATES

Except as provided in this Section 8.6, no new certificates for shares shall be issued to replace a previously issued certificate unless the latter is surrendered to the corporation and canceled at the same time. The board of directors may, in case any share certificate or certificate for any other security is lost, stolen or destroyed, authorize the issuance of replacement certificates on such terms

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and conditions as the board may require; the board may require indemnification of the corporation secured by a bond or other adequate security sufficient to protect the corporation against any claim that may be made against it, including any expense or liability, on account of the alleged loss, theft or destruction of the certificate or the issuance of the replacement certificate.

8.7 TRANSFER AGENTS AND REGISTRARS

The board of directors may appoint one or more transfer agents or transfer clerks, and one or more registrars, each of which shall be an incorporated bank or trust company -- either domestic or foreign, who shall be appointed at such times and places as the requirements of the corporation may necessitate and the board of directors may designate.

8.8 CONSTRUCTION; DEFINITIONS

Unless the context requires otherwise, the general provisions, rules of construction, and definitions in the General Corporation Law of Delaware shall govern the construction of these bylaws. Without limiting the generality of this provision, the singular number includes the plural, the plural number includes the singular, and the term "person" includes both a corporation and a natural person.

ARTICLE IX

AMENDMENTS

9.1 AMENDMENTS BY STOCKHOLDERS AND DIRECTORS

The original or other bylaws of the corporation may be adopted, amended or repealed by the stockholders entitled to vote or by the board of directors of the corporation. The fact that such power has been so conferred upon the directors shall not divest the stockholders of the power, nor limit their power to adopt, amend or repeal bylaws.

Whenever an amendment or new bylaw is adopted, it shall be copied in the book of bylaws with the original bylaws, in the appropriate place. If any bylaw is repealed, the fact of repeal with the date of the meeting at which the repeal was enacted or the filing of the operative written consent(s) shall be stated in said book.

9.2 SUPERMAJORITY VOTE

Notwithstanding anything to the contrary in the bylaws, neither Section
2.3 (special meeting), Section 2.5 (advance notice of stockholder nominees and stockholder business), nor this Section 9.2 (supermajority vote) of the bylaws shall be repealed or amended, nor shall any provision inconsistent

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with the aforementioned provisions be adopted and added to the bylaws except upon the affirmative vote of not less than two-thirds of the shares of the corporation issued and outstanding.

Amended and Restated Bylaws adopted by the Board of Directors of the Corporation at Mountain View, California, this 22nd day of January, 1999.

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EXHIBIT 4.2

SAGENT TECHNOLOGY, INC.

SIXTH AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

THIS SIXTH AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT is made
as of February 24, 1998(the "Agreement") by and among SAGENT TECHNOLOGY, INC., a California corporation (the "Company"), the purchasers of Series E Preferred Stock of the Company (the "Series E Investors"), who represent a majority of the outstanding shares of Preferred Stock of the Company, and Kenneth C. Gardner, John Zicker, Alice Blair, Craig R. Powers and Robert E. Powers (collectively, the "Founders" and each individually a "Founder").

RECITALS

WHEREAS, the Company, the Founders, the purchasers of Series A Preferred Stock pursuant to the Series A Preferred Stock Purchase Agreement, dated May 26, 1995, the purchasers of Series B Preferred Stock pursuant to the Series B Preferred Stock Purchase Agreement, dated November 15, 1995, the purchasers of Series C Preferred Stock pursuant to the Series C Preferred Stock Purchase Agreement, dated September 30, 1996, Stewart Schuster, an individual and investor of the Company's Series A Preferred Stock pursuant to a Series A Preferred Stock Purchase Agreement, dated October 10, 1995, Dennis Jones and Ralph Kimball, individuals and investors of the Company's Series C Preferred Stock, pursuant to Series C Preferred Stock Purchase Agreements, dated March 17, 1997 and June 16, 1997 respectively, and the purchasers of Series D Preferred Stock pursuant to the Series D Preferred Stock Purchase Agreement dated as of August 4, 1997 and September 26, 1997 (collectively, the "Prior Investors") are parties to a Fifth Amended and Restated Registration Rights Agreement dated as of August 4, 1997 (together with all amendments, the "Prior Agreement"); and

WHEREAS, the Prior Agreement sets forth all the registration rights (collectively the "Registration Rights") of the Prior Investors; and

WHEREAS, the Series E Investors, in connection with their proposal to purchase up to 1,895,370 shares of the Company's Series E Preferred Stock pursuant to the Series E Preferred Stock Purchase Agreement dated as of February 24, 1998 (the "Series E Agreement"), desire to obtain such Registration Rights; and

WHEREAS, the Company and a majority of the Prior Investors, on behalf of all Prior Investors, to induce the Series E Investors to purchase Series E Preferred Stock pursuant to a Series E Preferred Stock Purchase Agreement (the "Series E Agreement"), desire to grant the Series E Investors the Registration Rights, all as detailed herein.

NOW, THEREFORE, the parties hereto agree that, subject to the closing of the purchase of Series E Preferred Stock by the Series E Investors pursuant to the Series E Agreement: (i) the Prior Agreement is terminated and of no further force and effect; (ii) the Company and a majority of the Prior Investors, on behalf of all Prior Investors, hereby grant to the Series E Investors the rights set forth below; and (iii) the Company, a majority of the Prior Investors, on behalf of all Prior Investors, and the Series E Investors and


as a condition of closing of the Series E Agreement, accept and agree to the termination of all prior registration rights agreements and accept and agree to be bound by the terms of this Agreement.

SECTION 1

DEFINITIONS

1.1 CERTAIN DEFINITIONS. Hereafter, in this Agreement the following terms shall have the following respective meanings:

"Purchaser" shall mean each of the Series A Investors, the Series B Investors, the Series C Investors, the Series D Investors and the Series E Investors referred to individually as listed in Exhibit A.

"Purchasers" shall mean all the Series A Investors, the Series B Investors, the Series C Investors, the Series D Investors and the Series E Investors referred to collectively as listed in Exhibit A.

"Commission" shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act.

"Preferred" means the Series A Preferred Stock, the Series B Preferred Stock, the Series C Preferred Stock, the Series D Preferred Stock, and the Series E Preferred Stock of the Company.

"Conversion Stock" means the Common Stock issued or issuable pursuant to conversion of the Preferred.

"Holder" shall mean (i) any Purchaser holding Registrable Securities (including Preferred) and any person holding Registrable Securities to whom the rights under this Agreement have been transferred in accordance with Section 2.14 hereof and (ii) Lighthouse Capital Partners, L.P. ("Lighthouse").

"Initiating Holders" shall mean any Purchasers or transferees of Purchasers under Sec tion 2.14 hereof who in the aggregate are Holders of greater than 50% of the Registrable Securities.

"Registrable Securities" means (i) the Conversion Stock; (ii) all the shares of common stock issued or issuable upon the conversion of the shares of Series A Preferred Stock or Series B Preferred Stock now or hereafter held by Lighthouse (including the Series A Preferred Stock and Series B Preferred Stock issuable upon exercise of the warrants to purchase Series A Preferred Stock and Series B Preferred Stock held by Lighthouse) (collectively the "Lighthouse Stock"), and (iii) any Common Stock of the Company issued or issuable in respect of the Conversion Stock, the Lighthouse Stock or other securities issued or issuable pursuant to the conversion of the Preferred upon any stock split, stock dividend, recapitalization, or similar event, or any Common Stock otherwise issued or issuable with respect to the Preferred; provided,

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however, that shares of Common Stock or other securities shall only be treated as Registrable Securities if and so long as they have not been (A) sold to or through a broker or dealer or underwriter in a public distribution or a public securities transaction, whether in a registered offering, Rule 144 transaction or otherwise, or (B) sold or are available for sale in the opinion of counsel to the Company in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act so that all transfer restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale; provided, however, that the Company's stock is then publicly traded.

The terms "register," "registered" and "registration" refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of the effectiveness of such registration statement.

"Registration Expenses" shall mean all expenses, except as otherwise stated below, incurred by the Company in complying with Sections 2.4, 2.5 and 2.6 hereof, including, without limitation, all registration, qualification and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Company, blue sky fees and expenses, the expense of any special audits incident to or required by any such registration (but excluding the compensation of regular employees of the Company which shall be paid in any event by the Company) and the reasonable fees and disbursements of one counsel for all Holders in the event of one exercise of a requested registration provided for in Section 2.4 hereof, in the event of two Company registrations pursuant to Section 2.5 hereof, and for all Company registrations on Form S-3 pursuant to Section 2.6 hereof.

"Restricted Securities" shall mean the securities of the Company required to bear the legend set forth in Section 2.2 hereof.

"Securities Act" shall mean the Securities Act of 1933, as amended, or any similar federal statute and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

"Selling Expenses" shall mean all underwriting discounts, selling commissions and stock transfer taxes applicable to the securities registered by the Holders and, except as set forth above, all reasonable fees and disbursements of counsel for any Holder.

SECTION 2

RESTRICTIONS ON TRANSFERABILITY OF SECURITIES;
COMPLIANCE WITH SECURITIES ACT; REGISTRATION RIGHTS

2.1 RESTRICTIONS ON TRANSFERABILITY. The Preferred and the Conversion Stock shall not be sold, assigned, transferred or pledged except upon the conditions specified in this Section 2, which conditions are intended to ensure compliance with the provisions of the Securities Act. Each Purchaser will cause any

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proposed purchaser, assignee, transferee, or pledgee of the Preferred or such Common Stock held by a Purchaser to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Section 2.

2.2 RESTRICTIVE LEGEND. Each certificate representing (i) the Preferred, (ii) the Conversion Stock, and (iii) any other securities issued in respect of the Preferred or the Conversion Stock upon any stock split, stock dividend, recapitalization, merger, consolidation or similar event, shall (unless otherwise permitted by the provisions of Section 2.3 below) be stamped or otherwise imprinted with a legend in the following form (in addition to any legend required under applicable state securities laws):

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT. COPIES OF THE AGREEMENT COVERING THE PURCHASE OF THESE SHARES AND RESTRICTING THEIR TRANSFER MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF THE CORPORATION AT THE PRINCIPAL EXECUTIVE OFFICES OF THE CORPORATION.

Each Purchaser and Holder consents to the Company making a notation on its records and giving instructions to any transfer agent of the Preferred or the Common Stock in order to implement the restrictions on transfer established in this Section 2.

2.3 NOTICE OF PROPOSED TRANSFERS. The holder of each certificate representing Restricted Securities by acceptance thereof agrees to comply in all respects with the provisions of this Section 2.3. Prior to any proposed sale, assignment, transfer or pledge of any Restricted Securities (other than (i) a transfer not involving a change in beneficial ownership or (ii) in transactions involving the distribution without consideration of Restricted Securities by any of the Purchasers to any of its partners, or retired partners, or to the estate of any of its partners or retired partners), unless there is in effect a registration statement under the Securities Act covering the proposed transfer, the holder thereof shall give written notice to the Company of such holder's intention to effect such transfer, sale, assignment or pledge. Each such notice shall describe the manner and circumstances of the proposed transfer, sale, assignment or pledge in sufficient detail, and shall be accompanied, at such holder's expense by either (i) an unqualified written opinion of legal counsel, who shall be and whose legal opinion shall be reasonably satisfactory to the Company, addressed to the Company, to the effect that the proposed transfer of the Restricted Securities may be effected without registration under the Securities Act, or (ii) a "no action" letter from the Commission to the effect that the transfer of such securities without registration will not result in a recommendation

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by the staff of the Commission that action be taken with respect thereto, whereupon the holder of such Restricted Securities shall be entitled to transfer such Restricted Securities in accordance with the terms of the notice delivered by the holder to the Company. Each certificate evidencing the Restricted Securities transferred as above provided shall bear, except if such transfer is made pursuant to Rule 144, the appropriate restrictive legend set forth in
Section 2.2 above, except that such certificate shall not bear such restrictive legend if in the opinion of counsel for such holder and the Company such legend is not required in order to establish compliance with any provision of the Securities Act.

2.4 REQUESTED REGISTRATION.

(a) Request for Registration. In case the Company shall receive from Initiating Holders a written request that the Company effect any registration, qualification or compliance with respect to not less than ten percent (10%) of the shares (appropriately adjusted for Recapitalizations) of Registrable Securities, or any lesser number of shares if the anticipated aggregate offering price, net of underwriting discounts and commissions, would exceed $10 million, the Company will:

(i) promptly give written notice of the proposed registration, qualification or compliance to all other Holders; and

(ii) as soon as practicable, use its best efforts to effect such registration, qualification or compliance (including, without limitation, appropriate qualification under applicable blue sky or other state securities laws and appropriate compliance with applicable regulations issued under the Securities Act and any other governmental requirements or regulations) as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any Holder or Holders joining in such request as are specified in a written request received by the Company within 20 days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to take any action to effect any such registration, qualification or compliance pursuant to this Section 2.4:

(A) In any particular jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act;

(B) Prior to December 31, 1999;

(C) During the period starting with the date sixty (60) days prior to the Company's estimated date of filing of, and ending on the date six (6) months immediately following the effective date of, any registration statement pertaining to securities of the Company (other than a registration of securities in a Rule 145 transaction or with respect to an employee benefit plan), provided

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that the Company is actively employing in good faith all reasonable efforts to cause such registration statement to become effective;

(D) After the Company has effected two such registrations pursuant to this subparagraph 2.4(a), and such registrations have been declared or ordered effective;

(E) If the Company shall furnish to such Holders a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors it would be seriously detrimental to the Company or its shareholders for a registration statement to be filed in the near future, then the Company's obligation to use its best efforts to register, qualify or comply under this Section 2.4 shall be deferred for a period not to exceed 120 days from the date of receipt of written request from the Initiating Holders.

Subject to the foregoing clauses (A) through (E), the Company shall file a registration statement covering the Registrable Securities so requested to be registered as soon as practicable, after receipt of the request or requests of the Initiating Holders.

(b) Underwriting. In the event that a registration pursuant to
Section 2.4 is for a registered public offering involving an underwriting, the Company shall so advise the Holders as part of the notice given pursuant to
Section 2.4(a)(i). In such event, the right of any Holder to registration pursuant to Section 2.4 shall be conditioned upon such Holder's participation in the underwriting arrangements required by this Section 2.4, and the inclusion of such Holder's Registrable Securities in the underwriting to the extent requested shall be limited to the extent provided herein.

The Company shall (together with all Holders proposing to distribute their securities through such underwriting) enter into an underwriting agreement in customary form with the managing underwriter selected for such underwriting by a majority in interest of the Initiating Holders, but subject to the Company's reasonable approval. Notwithstanding any other provision of this
Section 2.4, if the managing underwriter advises the Initiating Holders in writing that marketing factors require a limitation of the number of shares to be underwritten, then the Company shall so advise all holders of Registrable Securities and the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all Holders thereof in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders at the time of filing the registration statement. No Registrable Securities excluded from the underwriting by reason of the underwriter's marketing limitation shall be included in such registration. To facilitate the allocation of shares in accordance with the above provisions, the Company or the underwriters may round the number of shares allocated to any Holder to the nearest 100 shares.

If any Holder of Registrable Securities disapproves of the terms of the underwriting, such person may elect to withdraw therefrom by written notice to the Company, the managing underwriter and the Initiating Holders. The Registrable Securities and/or other securities so withdrawn shall also be withdrawn from registration, and such Registrable Securities shall not be transferred in a public distribution prior to

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90 days after the effective date of such registration, or such other shorter period of time as the underwriters may require.

2.5 COMPANY REGISTRATION.

(a) Notice of Registration. If at any time or from time to time the Company shall determine to register any of its securities, either for its own account or the account of a security holder or holders, other than (i) in connection with the Company's initial public offering, or (ii) a registration relating solely to employee benefit plans, or (iii) a registration relating solely to a Commission Rule 145 transaction, the Company will:

(i) promptly give to each Holder written notice thereof; and

(ii) include in such registration (and any related qualification under blue sky laws or other compliance), and in any underwriting involved therein, all the Registrable Securities specified in a written request or requests, made within 20 days after receipt of such written notice from the Company, by any Holder.

(b) Underwriting. If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise the Holders as a part of the written notice given pursuant to Section 2.5(a)(i). In such event the right of any Holder to registration pursuant to Section 2.5 shall be conditioned upon such Holder's participation in such underwriting and the inclusion of Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with the Company and the other holders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the managing underwriter selected for such underwriting by the Company. Notwithstanding any other provision of this Section 2.5, if the managing underwriter determines that marketing factors require a limitation of the number of shares to be underwritten, the managing underwriter may limit the Registrable Securities to be included in such registration. The Company shall so advise all Holders and other holders distributing their securities through such underwriting and the number of shares of Registrable Securities that may be included in the registration and underwriting shall be allocated among all Holders and such other holders in proportion, as nearly as practicable, to the respective amounts of Registrable Securities held by such Holders and such other holders at the time of filing the registration statement. To facilitate the allocation of shares in accordance with the above provisions, the Company may round the number of shares allocated to any Holder or holder to the nearest 100 shares. If any Holder or holder disapproves of the terms of any such underwriting, he may elect to withdraw therefrom by written notice to the Company and the managing underwriter. Any securities excluded or withdrawn from such underwriting shall be withdrawn from such registration, and shall not be transferred in a public distribution prior to 90 days after the effective date of the registration statement relating thereto, or such other shorter period of time as the underwriters may require.

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(c) Right to Terminate Registration. The Company shall have the right to terminate or withdraw any registration initiated by it under this
Section 2.5 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration.

2.6 REGISTRATION ON FORM S-3.

(a) If any Holder or Holders holding in the aggregate not less than 5% of the then-outstanding Registrable Securities request that the Company file a registration statement on Form S-3 (or any successor form to Form S-3) for a public offering of shares of the Registrable Securities the reasonably anticipated aggregate offering price to the public of which, net of underwriting discounts and commissions, would exceed $1,000,000, and the Company is a registrant entitled to use Form S-3 to register the Registrable Securities for such an offering, the Company shall use its best efforts to cause such Registrable Securities to be registered for the offering on such form and to cause such Registrable Securities to be qualified in such jurisdictions as the Holder or Holders may reasonably request; provided, however, that the Company shall not be required to effect more than one registration pursuant to this
Section 2.6 in any six (6) month period or in excess of two registrations under this Section 2.6. The substantive provisions of Section 2.4(b) shall be applicable to each registration initiated under this Section 2.6.

(b) Notwithstanding the foregoing, the Company shall not be obligated to take any action pursuant to this Section 2.6: (i) in any particular jurisdiction in which the Company would be required to execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already subject to service in such jurisdiction and except as may be required by the Securities Act; (ii) if the Company, within ten (10) days of the receipt of the request of the initiating Holders, gives notice of its bona fide intention to effect the filing of a registration statement with the Commission within ninety (90) days of receipt of such request (other than with respect to a registration statement relating to a Rule 145 transaction, an offering solely to employees or any other registration which is not appropriate for the registration of Registrable Securities); (iii) during the period starting with the date sixty (60) days prior to the Company's estimated date of filing of, and ending on the date six (6) months immediately following, the effective date of any registration statement pertaining to securities of the Company (other than a registration of securities in a Rule 145 transaction or with respect to an employee benefit plan), provided that the Company is actively employing in good faith all reasonable efforts to cause such registration statement to become effective; or (iv) if the Company shall furnish to such Holder a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors it would be seriously detrimental to the Company or its shareholders for registration statements to be filed in the near future, then the Company's obligation to use its best efforts to file a registration statement shall be deferred for a period not to exceed 120 days from the receipt of the request to file such registration by such Holder.

2.7 LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. From and after the Closing Date, the Company shall not enter into any agreement granting any holder or prospective holder of any securities of the Company registration rights with respect to such securities unless (i) such new registration rights, including standoff obligations, are on a pari passu basis with those rights of the Holders hereunder; or

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(ii) such new registration rights, including standoff obligations, are subordinate to the registration rights granted Holders hereunder. Any such additional parties may execute a counterpart of this Agreement, and upon execution by such additional parties and by the Company, shall be considered a Holder for all purposes of this Agreement.

2.8 EXPENSES OF REGISTRATION. All Registration Expenses incurred in connection with (i) one registration pursuant to Section 2.4, (ii) two registrations pursuant to Section 2.5, and (iii) all registrations pursuant to
Section 2.6 shall be borne by the Company. Unless otherwise stated, all Selling Expenses relating to securities registered on behalf of the Holders and all other Registration Expenses shall be borne by the Holders of such securities pro rata on the basis of the number of shares so registered.

2.9 REGISTRATION PROCEDURES. In the case of each registration, qualification or compliance effected by the Company pursuant to this Section 2, the Company will keep each Holder advised in writing as to the initiation of each registration, qualification and compliance and as to the completion thereof. At its expense the Company will:

(a) Prepare and file with the Commission a registration statement with respect to such securities and use its best efforts to cause such registration statement to become and remain effective for at least one hundred eighty (180) days or until the distribution described in the Registration Statement has been completed;

(b) Furnish to the Holders participating in such registration and to the underwriters of the securities being registered such reasonable number of copies of the registration statement, preliminary prospectus, final prospectus and such other documents as such underwriters may reasonably request in order to facilitate the public offering of such securities.

2.10 INDEMNIFICATION.

(a) The Company will indemnify each Holder, each of its officers and directors and partners, and each person controlling such Holder within the meaning of Section 15 of the Securities Act, with respect to which registration, qualification or compliance has been effected pursuant to this
Section 2, and each underwriter, if any, and each person who controls any underwriter within the meaning of Section 15 of the Securities Act, against all expenses, claims, losses, damages or liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement of any litigation, commenced or threatened, arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any registration statement, prospectus, offering circular or other document, or any amendment or supplement thereto, incident to any such registration, qualification or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, or any violation by the Company of the Securities Act or any rule or regulation promulgated under the Securities Act applicable to the Company in connection with any such registration, qualification or compliance, and the Company will reimburse each such Holder, each of its officers and directors, and each person control-

-9-

ling such Holder, each such underwriter and each person who controls any such underwriter, for any legal and any other expenses reasonably incurred in connection with investigating, preparing or defending any such claim, loss, damage, liability or action, provided that the Company will not be liable in any such case to the extent that any such claim, loss, damage, liability or expense arises out of or is based on any untrue statement or omission or alleged untrue statement or omission, made in reliance upon and in conformity with written information furnished to the Company by an instrument duly executed by such Holder, controlling person or underwriter and stated to be specifically for use therein.

(b) Each Holder will, if Registrable Securities held by such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors and officers, each underwriter, if any, of the Company's securities covered by such a registration statement, each person who controls the Company or such underwriter within the meaning of Section 15 of the Securities Act, and each other such Holder, each of its officers and directors and each person controlling such Holder within the meaning of Section 15 of the Securities Act, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any such registration statement, prospectus, offering circular or other document, or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company, such Holders, such directors, officers, persons, underwriters or control persons for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company by an instrument duly executed by such Holder and stated to be specifically for use therein. Notwithstanding the foregoing, the liability of each Holder under this subsection (b) shall be limited in an amount equal to the initial public offering price of the shares sold by such Holder, unless such liability arises out of or is based on willful conduct by such Holder.

(c) Each party entitled to indemnification under this Section
2.10 (the "Indemnified Party") shall give notice to the party required to provide indemnification (the "Indemnifying Party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not unreasonably be withheld), and the Indemnified Party may participate in such defense at such party's expense, and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 2 unless the failure to give such notice is materially prejudicial to an Indemnifying Party's ability to defend such action and provided further, that the Indemnifying Party shall not assume the defense for matters as to which there is a conflict of interest or separate and different defenses. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement

-10-

which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation.

2.11 TERMINATION OF REGISTRATION RIGHTS. The rights granted pursuant to this Agreement shall terminate as to any Holder five (5) years after the closing of an underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, covering the offer and sale of common stock for the account of the Company to the public.

2.12 INFORMATION BY HOLDER. The Holder or Holders of Registrable Securities included in any registration shall furnish to the Company such information regarding such Holder or Holders, the Registrable Securities held by them and the distribution proposed by such Holder or Holders as the Company may request in writing and as shall be required in connection with any registration, qualification or compliance referred to in this Section 2.

2.13 RULE 144 REPORTING. With a view to making available the benefits of certain rules and regulations of the Commission which may at any time permit the sale of the Restricted Securities to the public without registration, after such time as a public market exists for the Common Stock of the Company, the Company agrees to use its best efforts to:

(a) Make and keep public information available, as those terms are understood and defined in Rule 144 under the Securities Act, at all times after the effective date that the Company becomes subject to the reporting requirements of the Securities Act or the Securities Exchange Act of 1934, as amended.

(b) Use its best efforts to file with the Commission in a timely manner all reports and other documents required of the Company under the Securities Act and the Securities Exchange Act of 1934, as amended (at any time after it has become subject to such reporting requirements);

(c) So long as a Purchaser owns any Restricted Securities to furnish to the Purchaser forthwith upon request a written statement by the Company as to its compliance with the reporting requirements of said Rule 144 (at any time after 90 days after the effective date of the first registration statement filed by the Company for an offering of its securities to the general public), and of the Securities Act and the Securities Exchange Act of 1934 (at any time after it has become subject to such reporting requirements), a copy of the most recent annual or quarterly report of the Company, and such other reports and documents of the Company and other information in the possession of or reasonably obtainable by the Company as a Purchaser may reasonably request in availing itself of any rule or regulation of the Commission allowing a Purchaser to sell any such securities without registration.

2.14 TRANSFER OF REGISTRATION RIGHTS. The rights to cause the Company to register securities granted Purchasers under Sections 2.4, 2.5 and 2.6 may be assigned to a transferee or assignee reasonably acceptable to the Company in connection with any transfer or assignment of Registrable Securities by a Purchaser provided that: (i) such transfer may otherwise be effected in accordance with applicable

-11-

securities laws, and (ii) such assignee or transferee acquires at least 100,000 shares of Preferred and/or Common Stock issued upon conversion thereof (appropriately adjusted for Recapitalizations). Notwithstanding the foregoing, the rights to cause the Company to register securities may be assigned to any constituent partner of a Purchaser, without compliance with item (ii) above, provided written notice thereof is promptly given to the Company.

2.15 STANDOFF AGREEMENT. Each Holder agrees in connection with the Company's initial public offering of the Company's securities that, upon request of the Company or the underwriters managing any underwritten offering of the Company's securities, not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any Registrable Securities (other than those included in the registration) without the prior written consent of the Company or such underwriters, as the case may be, for such period of time (not to exceed one hundred eighty (180) days) from the effective date of such registration as may be requested by the underwriters; provided, that the officers and directors of the Company who own stock of the Company also agree to such restrictions.

SECTION 3

EFFECT OF THIS AGREEMENT

3.1 TERMINATION OF OTHER RIGHTS. The Company and the Purchasers acknowledge and agree that this Agreement supersedes the Prior Agreement, and hence such agreement is terminated in its entirety. All parties hereto acknowledge and agree that this Agreement supersedes any and all prior registration rights granted by the Company to them, and that such rights are terminated in their entirety.

SECTION 4

MISCELLANEOUS

4.1 GOVERNING LAW. This Agreement shall be governed and construed in all respects in accordance with the laws of the State of California as applied to agreements made and performed in California by residents of the State of California.

4.2 ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the full and entire understanding and agreement between the parties with regard to the subjects hereof, and no party shall be liable or bound to any other party in any manner by any warranties, representations or covenants except or specifically set forth herein. Except as expressly provided herein, neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought; provided, however, that holders of a majority of the Common Stock issued or issuable upon conversion of

-12-

the Preferred may, with the Company's prior written consent, waive, modify or amend on behalf of all holders, any provisions hereof.

4.3 NOTICES, ETC. All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified mail, postage prepaid or otherwise delivered by hand or by messenger, addressed (a) if to a Purchaser (including Lighthouse) at such Purchaser's address set forth in Exhibit A, or at such other address as such Purchaser shall have furnished to the Company in writing or (b) if to any other holder of any shares of Company Stock, at such address as such holder shall have furnished the Company in writing, or until any such holder so furnishes an address to the Company, then to and at the address of the last holder of such shares who has so furnished an address to the Company, or (c) if to the Company, one copy should be sent to its address set forth in Exhibit B and addressed to the attention of the Corporate Secretary or at such other address as the Company shall have furnished to the Purchasers.

Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given when delivered if delivered personally, or, if sent by mail, at the earlier of its receipt or seventy-two (72) hours after the same has been deposited in a regularly maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid.

4.4 SEVERABILITY. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision; provided that no such severability shall be effective if it materially changes the economic benefit of this Agreement to any party.

4.5 TITLES AND SUBTITLES. The titles and subtitles used in this Agreement are used for convenience only and are not considered in construing or interpreting this Agreement.

4.6 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which may be executed by less than all of the Purchasers, each of which shall be enforceable against the parties actually executing such counterparts, and all of which together shall constitute one instrument.

-13-

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

SAGENT TECHNOLOGY, INC.

By:      /s/ KENNETH C. GARDNER
   ------------------------------------
Title:
     ----------------------------------

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FOUNDERS

--------------------------------    -------------------------------------------
Kenneth C. Gardner                  John Zicker


--------------------------------    -------------------------------------------
Alice Blair                         Craig R. Powers


--------------------------------
Robert E. Powers

SERIES E INVESTORS

EL DORADO VENTURES IV, L.P.
By: El Dorado Venture Partners IV, LLC
Its: General Partner

/s/ SHANDA BAHLES
-------------------------------------------
By:  Shanda Bahles
     Managing Member

EL DORADO TECHNOLOGY '98, L.P.
By: El Dorado Venture Partners IV, LLC.
Its: General Partner

/s/ SHANDA BAHLES
-------------------------------------------
By:  Shanda Bahles
     Managing Member



/s/ DAVID N. STROM
-------------------------------------------
GREYLOCK EQUITY LIMITED PARTNERSHIP
By:  Greylock Equity GP Limited Partnership
Its: General Partner
     David N. Strom

-15-

/s/ RICH SHAPERO
-------------------------------------------
CROSSPOINT VENTURE PARTNERS 1997
By:  Rich Shapero
Its:  General Partner



/s/ JEFFREY T. WEBBER
-------------------------------------------
RBW INVESTMENTS, LLC
By: Jeffrey T. Webber
Its: Managing Director


/s/ JEFFREY T. WEBBER
-------------------------------------------
THE ENTREPRENEURS' FUND, L.P.
By: BW Management, LLC
Its: General Partner
By: Jeffrey T. Webber, Managing Director

-16-

EXHIBIT A

SCHEDULE OF INVESTORS

Crosspoint Venture Partners 1993
Crosspoint 1993 Entrepreneurs Fund
Rich Shapero
One First Street
Los Altos, CA 94022

El Dorado Ventures III, L.P.
El Dorado Technology IV, L.P.
c/o Shanda Bahles
20300 Stevens Creek Blvd.
Suite 395
Cupertino, CA 95014

Delaware Charter Guarantee & Trust Co.,
Trustee FBO Kenneth C. Gardner, IRA
829 Hermosa Way
Menlo Park, CA 94025

Delaware Charter Guarantee & Trust Co.,
Trustee FBO John E. Zicker, IRA
451 Portola Road
Portola Valley, CA 94028

Craig Powers
2036 Lyon Avenue
Belmont, CA 94002

Robert Powers
182 Dogwood Court
Hayward, CA 94544

Alice Blair
252 2nd Avenue
San Francisco, CA 94118

James Shircliff
5100 Olde Creek Way
Prospect, KY 40059

Arthur F. Schneiderman
Jason A. Schneiderman
Jeffrey A. Schneiderman
Jennifer A. Schneiderman
Jonathan A. Schneiderman
Julie A. Schneiderman
230 Woodside Road
Woodside, CA 94062

Meriken Nominees Ltd.
Attn: Tony Geoghegan
c/o Aall Trust & Banking Corporation Ltd.
The Aall Building
P.O. Box 1166
Grand Cayman, Cayman Islands
British West Indies

Jeffrey T. Webber
c/o R.B. Webber & Co.
1717 Embarcadero Road
Palo Alto, CA 94303
(415)424-9900

Scott Willey
663 Princeton Drive
Sunnyvale, CA 94087


WS Investments Attn: Linda Wilson 650 Page Mill Road Palo Alto, CA 94304-1050

Judith Jordan Webber c/o Jordan Sparkling Wine 150 North Street Healdsburg, CA 95448

James D. Woodward and Elaine K. Waski, Trustees of the Woodward Family Trust dated 8/23/90 9817 Koupela Drive Raleigh, NC 27614

Eugene Webber, Trustee of the Webber Family Trust dated 1/6/89 1806 Vallejo Street San Francisco, CA 94123

J.F. Brilando, Inc. 241 S. Balsamina Way Portola Valley, CA 94028

Stephen K. Plume, III 24 Loveland Hill Road White River Junction, VT 05001

Stephen K. Plume, IV 473 Dell Avenue Mountain View, CA 94043

Jordan Consulting Group Attn: Stephen A. Jordan 12600 Viscaino Court Los Altos Hills, CA 94022

William Elmore c/o Merrill Pickard ET AL 2480 Sand Hill Road Menlo Park, CA 94025

Robert Lauridsen and Patricia Lauridsen 1785 Bay Laurel Drive Menlo Park, CA 94025

S-1 Trust c/o Peter Thorne 42 Pleasant Street Watertown, MA 02172

Robert Spencer 27857 Altamont Circle Los Altos Hills, CA 94022

Perry S. Mizota 2075 Sutter Street, #221 San Francisco, CA 94115

Stewart A. Schuster 1858 Rockspring Place Walnut Creek, CA 94596

Greylock Equity Limited Partnership c/o David N. Strohm 755 Page Mill Road Suite A-100 Palo Alto, CA 94304-1018

Dan Shelley 29920 43rd Ave. South Auburn, WA 98001

U.S. Venture Partners IV, L.P.


Second Ventures II, L.P.
USVP Entrepreneur Partners II, L.P.
2180 Associates Fund
2180 Sand Hill Road
Suite 300
Menlo Park, CA 94025

-2-

Lighthouse Capital Partners, L.P.

100 Drakes Landing Road, Suite 260
Greenbrae, California 94904
Attn: Contract Administration

Dennis Jones
Federal Express Corporation
2005 Corporate Avenue
Memphis, TN 38132
U.S. Mail: P.O. Box 727
Memphis, TN 38194-1841

Ralph Kimball
Ralph Kimball Associates, Inc.
13750 Highway 9
Boulder Creek, CA 95006

Tom Lounibos
[ADDRESS]

-3-

EXHIBIT B

COMPANY ADDRESS

Sagent Technology, Inc.
2225 E. Bayshore, Suite 100
Palo Alto, CA 94303


EXHIBIT 4.3

SAGENT TECHNOLOGY, INC.

COMMON STOCK REGISTRATION RIGHTS AGREEMENT

THIS COMMON STOCK REGISTRATION RIGHTS AGREEMENT is made as of September 14, 1998 (the "Agreement") by and among SAGENT TECHNOLOGY, INC., a California corporation (the "Company") and Robert Hawk (the "Investor").

RECITALS

WHEREAS, the Company and the Investor entered into the Common Stock Purchase Agreement, dated as of September 14, 1998, pursuant to which Investor purchased 10,000 shares of Common Stock (the "Shares") of the Company; and

WHEREAS, the Investor, in connection with such purchase, desires to obtain certain registration rights with respect to such Shares.

NOW, THEREFORE, the parties hereto agree, subject to the closing of the purchase of Shares, to the following:

SECTION 1

DEFINITIONS

1.1 CERTAIN DEFINITIONS. Hereafter, in this Agreement the following terms shall have the following respective meanings:

"Commission" shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act.

The terms "register," "registered" and "registration" refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of the effectiveness of such registration statement.

"Registration Expenses" shall mean all expenses, except as otherwise stated below, incurred by the Company in complying with Sections 2.1 hereof, including, without limitation, all registration, qualification and filing fees, printing expenses, escrow fees, fees and disbursements of counsel for the Company, blue sky fees and expenses, the expense of any special audits incident to or required by any such registration (but excluding the compensation of regular employees of the Company which shall be paid in any event by the Company).


"Securities Act" shall mean the Securities Act of 1933, as amended, or any similar federal statute and the rules and regulations of the Commission thereunder, all as the same shall be in effect at the time.

"Selling Expenses" shall mean all underwriting discounts, selling commissions and stock transfer taxes applicable to the securities registered by Investor and, except as set forth above, all reasonable fees and disbursements of counsel for Investor.

SECTION 2

REGISTRATION RIGHTS

2.1 COMPANY REGISTRATION.

(a) Notice of Registration. If at any time or from time to time the Company shall determine to register any of its securities, either for its own account or the account of a security holder or holders, other than (i) in connection with the Company's initial public offering, or (ii) a registration relating solely to employee benefit plans, or (iii) a registration relating solely to a Commission Rule 145 transaction, the Company will:

(i) promptly give Investor written notice thereof; and

(ii) include in such registration (and any related qualification under blue sky laws or other compliance), and in any underwriting involved therein, all the Shares specified in a written request or requests, made within 20 days after receipt of such written notice from the Company, by Investor.

(b) Underwriting. If the registration of which the Company gives notice is for a registered public offering involving an underwriting, the Company shall so advise Investor as a part of the written notice given pursuant to Section 2.1(a)(i). In such event the right of Investor to registration pursuant to Section 2.1 shall be conditioned upon Investor's participation in such underwriting and the inclusion of the Shares in the underwriting to the extent provided herein. All stockholders proposing to distribute their securities through such underwriting shall (together with the Company and the other holders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with the managing underwriter selected for such underwriting by the Company. Notwithstanding any other provision of this Section 2.1, if the managing underwriter determines that marketing factors require a limitation of the number of shares to be underwritten, the managing underwriter may limit the securities to be included in such registration. The Company shall so advise Investor, and the number of Shares that may be included in the registration. If Investor disapproves of the terms of any such underwriting, Investor may elect to withdraw therefrom by written notice to the Company and the managing underwriter. Any securities excluded or withdrawn from such underwriting shall be withdrawn from such registration, and

-2-

shall not be transferred in a public distribution prior to 90 days after the effective date of the registration statement relating thereto, or such other shorter period of time as the underwriters may require.

(c) Right to Terminate Registration. The Company shall have the right to terminate or withdraw any registration initiated by it under this
Section 2.1 prior to the effectiveness of such registration whether or not Investor has elected to include securities in such registration.

2.2 EXPENSES OF REGISTRATION. All Registration Expenses incurred in connection with one registration pursuant to Section 2.1 shall be borne by the Company. Unless otherwise stated, Investor shall bear Investor's Selling Expenses relating to securities registered on behalf of the Investor.

2.3 REGISTRATION PROCEDURES. In the case of each registration, qualification or compliance effected by the Company pursuant to Section 2.1, the Company will keep Investor advised in writing as to the initiation of each registration, qualification and compliance and as to the completion thereof. At its expense the Company will:

(a) Prepare and file with the Commission a registration statement with respect to such securities and use its best efforts to cause such registration statement to become and remain effective for at least one hundred eighty (180) days or until the distribution described in the Registration Statement has been completed;

(b) Furnish to Investor and to the underwriters of the securities being registered such reasonable number of copies of the registration statement, preliminary prospectus, final prospectus and such other documents as such underwriters may reasonably request in order to facilitate the public offering of such securities.

2.4 INDEMNIFICATION.

(a) The Company will indemnify Investor with respect to which registration, qualification or compliance has been effected pursuant to Section 2.1, and each underwriter, if any, and each person who controls any underwriter within the meaning of Section 15 of the Securities Act, against all expenses, claims, losses, damages or liabilities (or actions in respect thereof), including any of the foregoing incurred in settlement of any litigation, commenced or threatened, arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any registration statement, prospectus, offering circular or other document, or any amendment or supplement thereto, incident to any such registration, qualification or compliance, or based on any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading, or any violation by the Company of the Securities Act or any rule or regulation promulgated under the Securities Act applicable to the Company in connection with any such registration, qualification or compliance, and the Company will reimburse Investor, each such underwriter and each person who controls any such underwriter, for any legal and any other expenses reasonably incurred in connection with investigating, preparing or defending any such claim, loss, damage,

-3-

liability or action, provided that the Company will not be liable in any such case to the extent that any such claim, loss, damage, liability or expense arises out of or is based on any untrue statement or omission or alleged untrue statement or omission, made in reliance upon and in conformity with written information furnished to the Company by an instrument duly executed by Investor, controlling person or underwriter and stated to be specifically for use therein.

(b) Investor will, if Shares held by Investor are included in the securities as to which such registration, qualification or compliance is being effected, indemnify the Company, each of its directors and officers, each underwriter, if any, of the Company's securities covered by such a registration statement, each person who controls the Company or such underwriter within the meaning of Section 15 of the Securities Act, and each other such holder of registration rights, each officer and director and each person controlling such holder within the meaning of Section 15 of the Securities Act, against all claims, losses, damages and liabilities (or actions in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in any such registration statement, prospectus, offering circular or other document, or any omission (or alleged omission) to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Company, such holders, such directors, officers, persons, underwriters or control persons for any legal or any other expenses reasonably incurred in connection with investigating or defending any such claim, loss, damage, liability or action, in each case to the extent, but only to the extent, that such untrue statement (or alleged untrue statement) or omission (or alleged omission) is made in such registration statement, prospectus, offering circular or other document in reliance upon and in conformity with written information furnished to the Company by an instrument duly executed by Investor and stated to be specifically for use therein. Notwithstanding the foregoing, the liability of Investor under this subsection
(b) shall be limited in an amount equal to the initial public offering price of the shares sold by Investor, unless such liability arises out of or is based on willful conduct by Investor.

(c) Each party entitled to indemnification under this Section 2.4 (the "Indemnified Party") shall give notice to the party required to provide indemnification (the "Indemnifying Party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval shall not unreasonably be withheld), and the Indemnified Party may participate in such defense at such party's expense, and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 2 unless the failure to give such notice is materially prejudicial to an Indemnifying Party's ability to defend such action and provided further, that the Indemnifying Party shall not assume the defense for matters as to which there is a conflict of interest or separate and different defenses. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation.

-4-

2.5 TERMINATION OF REGISTRATION RIGHTS. The rights granted pursuant to this Agreement shall terminate five (5) years after the closing of an underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, covering the offer and sale of common stock for the account of the Company to the public.

2.6 INFORMATION BY INVESTOR. The Investor shall furnish to the Company such information regarding Investor, the Shares held by Investor and the distribution proposed by Investor as the Company may request in writing and as shall be required in connection with any registration, qualification or compliance referred to in this Section 2.

2.7 TRANSFER OF REGISTRATION RIGHTS. The rights to cause the Company to register securities granted to Investor under Sections 2.1 may be assigned to a transferee or assignee reasonably acceptable to the Company in connection with any transfer or assignment of Shares by Investor provided that: (i) such transfer may otherwise be effected in accordance with applicable securities laws, and (ii) such transferee or assignee agrees to be bound by the provisions hereof.

SECTION 3

MISCELLANEOUS

3.1 GOVERNING LAW. This Agreement shall be governed and construed in all respects in accordance with the laws of the State of California as applied to agreements made and performed in California by residents of the State of California.

3.2 ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the full and entire understanding and agreement between the parties with regard to the subjects hereof, and no party shall be liable or bound to any other party in any manner by any warranties, representations or covenants except or specifically set forth herein. Except as expressly provided herein, neither this Agreement nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the party against whom enforcement of any such amendment, waiver, discharge or termination is sought.

3.3 NOTICES, ETC. All notices and other communications required or permitted hereunder shall be in writing and shall be mailed by registered or certified mail, postage prepaid or otherwise delivered by hand or by messenger, addressed (a) if to Investor, at Investor's address set forth in Exhibit A, or at such other address as Investor shall have furnished to the Company in writing or (b) if to any other holder of any shares of Company Stock, at such address as such holder shall have furnished the Company in writing, or until any such holder so furnishes an address to the Company, then to and at the address of the last holder of such shares who has so furnished an address to the Company, or
(c) if to the Company, one copy should be sent to its address set forth in Exhibit B and addressed to the attention of the Corporate Secretary or at such other address as the Company shall have furnished to Investor.

-5-

Each such notice or other communication shall for all purposes of this Agreement be treated as effective or having been given when delivered if delivered personally, or, if sent by mail, at the earlier of its receipt or seventy-two (72) hours after the same has been deposited in a regularly maintained receptacle for the deposit of the United States mail, addressed and mailed as aforesaid.

3.4 SEVERABILITY. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision; provided that no such severability shall be effective if it materially changes the economic benefit of this Agreement to any party.

3.5 TITLES AND SUBTITLES. The titles and subtitles used in this Agreement are used for convenience only and are not considered in construing or interpreting this Agreement.

3.6 COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which may be executed by less than all of the Purchasers, each of which shall be enforceable against the parties actually executing such counterparts, and all of which together shall constitute one instrument.

-6-

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

SAGENT TECHNOLOGY, INC.

By:    /s/ W. Virginia Walker
    ---------------------------------

Title: Executive Vice President (CFO)
       ------------------------------

ROBERT HAWK

/s/ Robert Hawk
-------------------------------------

-7-

EXHIBIT A

Schedule of Investor

Robert Hawk
[Address]
[Telephone number]


EXHIBIT B

COMPANY ADDRESS

Sagent Technology, Inc.
2225 E. Bayshore, Suite 100
Palo Alto, CA 94303


EXHIBIT 10.1

SAGENT TECHNOLOGY, INC.

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT ("Agreement") is made as of this day, November 30, 1995, by and between Sagent Technology, Inc., a California corporation (the "Company"), and Name ("Indemnitee").

WHEREAS, the Company and Indemnitee recognize the increasing difficulty in obtaining directors' and officers' liability insurance, the significant increases in the cost of such insurance and the general reductions in the coverage of such insurance;

WHEREAS, the Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting officers and directors to expensive litigation risks at the same time as the availability and coverage of liability insurance has been severely limited;

WHEREAS, Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other officers and directors of the Company may not be willing to continue to serve as officers and directors without additional protection; and

WHEREAS, the Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as officers and directors of the Company and to indemnify its officers and directors so as to provide them with the maximum protection permitted by law.

NOW, THEREFORE, the Company and Indemnitee hereby agree as follows:

1. INDEMNIFICATION.

(a) Third Party Proceedings. The Company shall indemnify Indemnitee if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while an officer or director or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually and reasonably incurred by Indemnitee in connection with such action or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the Company, and, with respect to any criminal action or pro ceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that (i) Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in the best interests of the Company, or (ii) with


respect to any criminal action or proceeding, Indemnitee had reasonable cause to believe that Indemnitee's conduct was unlawful.

(b) Proceedings By or in the Right of the Company. The Company shall indemnify Indemnitee if Indemnitee was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor by reason of the fact that Indemnitee is or was a director, officer, employee or agent of the Company, or any subsidiary of the Company, by reason of any action or inaction on the part of Indemnitee while an officer or director or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees) and, to the fullest extent permitted by law, amounts paid in settlement, in each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the Company and its shareholders, except that no indemnification shall be made in respect of any claim, issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its shareholders unless and only to the extent that the court in which such action or proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and then only to the extent that the court shall determine.

2. EXPENSES; INDEMNIFICATION PROCEDURE.

(a) Advancement of Expenses. The Company shall advance all expenses incurred by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil or criminal action or proceeding referenced in
Section 1(a) or (b) hereof (but not amounts actually paid in settlement of any such action or proceeding). Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that Indemnitee is not entitled to be indemni fied by the Company as authorized hereby. The advances to be made hereunder shall be paid by the Company to Indemnitee within twenty (20) days following delivery of a written request therefor by Indemnitee to the Company.

(b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a condition precedent to his right to be indemnified under this Agreement, give the Company notice in writing as soon as practicable of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the Chief Executive Officer of the Company at the address shown on the signature page of this Agreement (or such other address as the Company shall designate in writing to Indemnitee). Notice shall be deemed received three business days after the date postmarked if sent by domestic certified or registered mail, properly addressed; otherwise notice shall be deemed received when such notice shall actually be received by the Company. In addition, Indemnitee shall give the Company such information and cooperation as it may reasonably require and as shall be within Indemnitee's power.

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(c) Procedure. Any indemnification provided for in Section 1 shall be made no later than forty-five (45) days after receipt of the written request of Indemnitee. If a claim under this Agreement, under any statute, or under any provision of the Company's Articles of Incorporation or Bylaws providing for indemnification, is not paid in full by the Company within forty-five (45) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 13 of this Agreement, Indemnitee shall also be entitled to be paid for the expenses (including attorneys' fees) of bringing such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any action or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed, but Indemnitee shall be entitled to receive interim payments of expenses pursuant to Subsection 2(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the parties' intention that if the Company contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of Directors, any com mittee or subgroup of the Board of Directors, independent legal counsel, or its shareholders) to have made a determination that indemnification of Indemnitee is proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual deter mination by the Company (including its Board of Directors, any committee or subgroup of the Board of Directors, independent legal counsel, or its shareholders) that Indemnitee has not met such applicable standard of conduct, shall create a presumption that Indemnitee has or has not met the applicable standard of conduct.

(d) Notice to Insurers. If, at the time of the receipt of a notice of a claim pursuant to Section 2(b) hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

(e) Selection of Counsel. In the event the Company shall be obligated under Section 2(a) hereof to pay the expenses of any proceeding against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indem nitee, which approval shall not be unreasonably withheld, upon the delivery to Indemnitee of written notice of its election so to do. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same pro ceeding, provided that (i) Indemnitee shall have the right to employ his counsel in any such proceeding at Indemnitee's expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense or (C) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of Indemnitee's counsel shall be at the expense of the Company.

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3. ADDITIONAL INDEMNIFICATION RIGHTS; NONEXCLUSIVITY.

(a) Scope. Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify the Indemnitee to the fullest extent permitted by law, notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Articles of Incorporation, the Company's By-laws or by statute. In the event of any change, after the date of this Agreement, in any applicable law, statute or rule which expands the right of a California corporation to indemnify a member of its board of directors or an officer, such changes shall be, ipso facto, within the purview of Indemnitee's rights and Company's obligations, under this Agreement. In the event of any change in any applicable law, statute or rule which narrows the right of a California corporation to indemnify a member of its Board of Directors or an officer, such changes, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement shall have no effect on this Agreement or the parties' rights and obligations hereunder.

(b) Nonexclusivity. The indemnification provided by this Agreement shall not be deemed exclusive of any rights to which Indemnitee may be entitled under the Company's Articles of Incorporation, its By-laws, any agreement, any vote of shareholders or disinterested directors, the California General Corporation Law, or otherwise, both as to action in Indemnitee's official capacity and as to action in another capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even though he may have ceased to serve in such capacity at the time of any action or other covered proceeding.

4. PARTIAL INDEMNIFICATION. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of the expenses, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal action or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which Indemnitee is entitled.

5. MUTUAL ACKNOWLEDGEMENT. Both the Company and Indemnitee acknowledge that in certain instances, Federal law or applicable public policy may prohibit the Company from indemnifying its directors and officers under this Agreement or otherwise. Indemnitee understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee.

6. DIRECTORS' AND OFFICERS' LIABILITY INSURANCE. The Company shall, from time to time, make the good faith determination whether or not it is practicable for the Company to obtain and main tain a policy or policies of insurance with reputable insurance companies providing the officers and directors of the Company with coverage for losses from wrongful acts, or to ensure the Company's performance of its indemnification obligations under this Agreement. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. In all policies of directors' and officers' liability insurance, Indemnitee shall be named

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as an insured in such a manner as to provide Indemnitee the same rights and benefits as are accorded to the most favorably insured of the Company's directors, if Indemnitee is a director; or of the Company's officers, if Indemnitee is not a director of the Company but is an officer; or of the Company's key employees, if Indemnitee is not an officer or director but is a key employee. Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such insurance is not reasonably available, if the premium costs for such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee is covered by similar insurance maintained by a subsidiary or parent of the Company.

7. SEVERABILITY. Nothing in this Agreement is intended to require or shall be construed as requiring the Company to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this Agreement. The provisions of this Agreement shall be severable as provided in this Section 7. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of this Agreement not so invalidated shall be enforceable in accordance with its terms.

8. EXCEPTIONS. Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:

(a) Excluded Acts. To indemnify Indemnitee for any acts or omissions or transactions from which a director may not be relieved of liability under the California General Corporation Law.

(b) Claims Initiated by Indemnitee. To indemnify or advance expenses to Indemnitee with respect to proceedings or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or law or otherwise as required under
Section 317 of the California General Corporation Law, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; or

(c) Lack of Good Faith. To indemnify Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or

(d) Insured Claims. To indemnify Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee by an insurance carrier under a policy of directors' and officers' liability insurance maintained by the Company; or

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(e) Claims Under Section 16(b). To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute.

9. EFFECTIVENESS OF AGREEMENT. To the extent that the indemnification permitted under the terms of certain provisions of this Agreement exceeds the scope of the indemnification provided for in the California General Corporation Law, such provisions shall not be effective unless and until the Company's Articles of Incorporation authorize such additional rights of indemnification. In all other respects, the balance of this Agreement shall be effective as of the date set forth on the first page and may apply to acts or omissions of Indemnitee which occurred prior to such date if Indemnitee was an officer, director, employee or other agent of the Company, or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, at the time such act or omission occurred.

10. CONSTRUCTION OF CERTAIN PHRASES.

(a) For purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a con stituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued.

(b) For purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company which imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries.

11. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which shall constitute an original.

12. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the Company and its successors and assigns, and shall inure to the benefit of Indemnitee and Indemnitee's estate, heirs, legal representatives and assigns.

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13. ATTORNEYS' FEES. In the event that any action is instituted by Indemnitee under this Agreement to enforce or interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees, incurred by Indemnitee with respect to such action, unless as a part of such action, the court of competent jurisdiction determines that each of the material assertions made by Indemnitee as a basis for such action were not made in good faith or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement or to enforce or interpret any of the terms of this Agreement, Indemnitee shall be entitled to be paid all court costs and expenses, including attorneys' fees, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and cross-claims made in such action), unless as a part of such action the court determines that each of Indemnitee's material defenses to such action were made in bad faith or were frivolous.

14. NOTICE. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee, on the date of such receipt, or (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice.

15. CONSENT TO JURISDICTION. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of California for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement and agree that any action instituted under this Agreement shall be brought only in the state courts of the State of California.

16. CHOICE OF LAW. This Agreement shall be governed by and its provisions construed in accordance with the laws of the State of California as applied to contracts between California residents entered into and to be performed entirely within California.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

SAGENT TECHNOLOGY, INC.

By:

Title:

750 Menlo Avenue, Suite 300 Menlo Park, CA 94025

AGREED TO AND ACCEPTED:

INDEMNITEE:

FIELD(Name)


(signature)


(address)

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EXHIBIT 10.2

SAGENT TECHNOLOGY, INC.

AMENDED 1995 STOCK PLAN

1. Purposes of the Plan. The purposes of this Stock Plan are to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to Employees and Consultants of the Company and its Subsidiaries and to promote the success of the Company's business. Options granted under the Plan may be incentive stock options (as defined under Section 422 of the Code) or nonstatutory stock options, as determined by the Administrator at the time of grant of an option and subject to the applicable provisions of Section 422 of the Code, as amended, and the regulations promulgated thereunder.

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

(a) "Administrator" means the Board or any of its Committees appointed pursuant to Section 4 of the Plan.

(b) "Applicable Laws" means the requirements relating to the administration of stock option plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any foreign country or jurisdiction where Options or Stock Purchase Rights are granted under the Plan.

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

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

(e) "Committee" means a Committee appointed by the Board of Directors in accordance with Section 4 of the Plan.

(f) "Common Stock" means the Common Stock of the Company.

(g) "Company" means Sagent Technology, Inc., a California corporation.

(h) "Consultant" means any person who is engaged by the Company or any Parent or Subsidiary to render consulting or advisory services and is compensated for such services, and any director of the Company whether compensated for such services or not. If and in the event the Company registers any class of any equity security pursuant to the Exchange Act, the term Consultant shall thereafter not include directors who are not compensated for their services or are paid only a director's fee by the Company.


(i) "Continuous Status as an Employee or Consultant" means that the employment or consulting relationship with the Company, any Parent, or Subsidiary, is not interrupted or terminated. Continuous Status as an Employee or Consultant shall not be considered interrupted in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. A leave of absence approved by the Company shall include sick leave, military leave, or any other personal leave approved by an authorized representative of the Company. For purposes of Incentive Stock Options, no such leave may exceed 90 days, unless reemployment upon expiration of such leave is guaranteed by statute or contract, including Company policies. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, on the 181st day of such leave any Incentive Stock Option held by the Optionee shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option.

(j) "Employee" means any person, including Officers and directors, employed by the Company or any Parent or Subsidiary of the Company. The payment of a director's fee by the Company shall not be sufficient to constitute "employment" by the Company.

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

(l) "Fair Market Value" means, as of any date, the value of Common Stock determined as follows:

(i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market of the National Association of Securities Dealers, Inc. Automated Quotation ("NASDAQ") System, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(ii) If the Common Stock is quoted on the NASDAQ System (but not on the Nasdaq National Market thereof) or regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day prior to the day of determination, or;

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

(m) "Incentive Stock Option" means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code.

(n) "Nonstatutory Stock Option" means an Option not intended to qualify as an Incentive Stock Option.

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(o) "Officer" means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(p) "Option" means a stock option granted pursuant to the Plan.

(q) "Option Agreement" means a written or electronic agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan.

(r) "Option Exchange Program" means a program whereby outstanding Options are exchanged for Options with a lower exercise price.

(s) "Optioned Stock" means the Common Stock subject to an Option.

(t) "Optionee" means an Employee or Consultant who receives an Option.

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

(v) "Plan" means this Amended 1995 Stock Plan.

(w) "Restricted Stock" means shares of Common Stock acquired pursuant to a grant of a Stock Purchase Right under Section 12 below.

(x) "Section 16(b)" means Section 16(b) of the Securities Exchange Act of 1934, as amended.

(y) "Service Provider" means an Employee or Consultant.

(z) "Share" means a share of the Common Stock, as adjusted in accordance with Section 12 below.

(aa) "Stock Purchase Right" means a right to purchase Common Stock pursuant to Section 12 below.

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

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3. Stock Subject to the Plan. Subject to the provisions of Section 12 of the Plan, the maximum aggregate number of Shares which may be optioned and sold under the Plan is 3,225,000(1) Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.

If an Option expires or becomes unexercisable without having been exercised in full, or is surrendered pursuant to an Option Exchange Program, the unpurchased Shares which were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has terminated); provided, however, that Shares that have actually been issued under the Plan shall not be returned to the Plan and shall not become available for future distribution under the Plan, except that if unvested Shares are repurchased by the Company at their original purchase price, and the original purchaser of such Shares did not receive any benefits of ownership of such Shares, such Shares shall become available for future grant under the Plan. For purposes of the preceding sentence, voting rights shall not be considered a benefit of Share ownership.

4. Administration of the Plan.

(a) The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee shall be constituted to comply with Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities, the Administrator shall have the authority in its discretion.

(i) to determine the Fair Market Value;

(ii) to select the Service Providers to whom Options and Stock Purchase Rights may from time to time be granted hereunder;

(iii) to determine the number of Shares to be covered by each such award granted hereunder;

(iv) to approve forms of agreement for use under the Plan;

(v) to determine the terms and conditions, of any Option or Stock Purchase Right granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any Option or Stock Purchase Right or the Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine;


(1) As increased from 1,200,000 to 1,800,000 on August 20, 1996, from 1,800,000 to 2,800,000 on September 16, 1997, and from 2,800,000 to 3,225,000 on February 20, 1998.

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(vi) to determine whether and under what circumstances an Option may be settled in cash under subsection 9(f) instead of Common Stock;

(vii) to reduce the exercise price of any Option to the then current Fair Market Value if the Fair Market Value of the Common Stock covered by such Option has declined since the date the Option was granted;

(viii) to initiate an Option Exchange Program;

(ix) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws;

(x) to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to be issued upon exercise of an Option or Stock Purchase Right that number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by Optionees to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable; and

(xi) to construe and interpret the terms of the Plan and awards granted pursuant to the Plan.

(c) Effect of Administrator's Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on all Optionees.

5. Eligibility.

(a) Nonstatutory Stock Options and Stock Purchase Rights may be granted to Employees and Consultants. Incentive Stock Options may be granted only to Employees. An Employee or Consultant who has been granted an Option may, if otherwise eligible, be granted additional Options.

(b) Each Option shall be designated in the written option agreement as either an Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designations, to the extent that the aggregate Fair Market Value:

(i) of Shares subject to an Optionee's Incentive Stock Options granted by the Company, any Parent or Subsidiary, which

(ii) become exercisable for the first time during any calendar year (under all plans of the Company or any Parent or Subsidiary) exceeds $100,000, such excess Options shall be treated as Nonstatutory Stock Options. For purposes of this Section 5(b), Incentive Stock Options shall

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be taken into account in the order in which they were granted, and the Fair Market Value of the Shares shall be determined as of the time the Option with respect to such Shares is granted.

(c) The Plan shall not confer upon any Optionee any right with respect to continuation of employment or consulting relationship with the Company, nor shall it interfere in any way with his or her right or the Company's right to terminate his or her employment or consulting relationship at any time, with or without cause.

6. Term of Plan. The Plan shall become effective upon the earlier to occur of its adoption by the Board of Directors or its approval by the shareholders of the Company, as described in Section 17 of the Plan. It shall continue in effect for a term of ten (10) years unless sooner terminated under
Section 13 of the Plan.

7. Term of Option. The term of each Option shall be the term stated in the Option Agreement; provided, however, that the term shall be no more than ten
(10) years from the date of grant thereof. However, in the case of an Incentive Stock Option granted to an Optionee who, at the time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Option shall be five (5) years from the date of grant thereof or such shorter term as may be provided in the Option Agreement.

8. Option Exercise Price and Consideration.

(a) The per share exercise price for the Shares to be issued pursuant to exercise of an Option shall be such price as is determined by the Board, but shall be subject to the following:

(i) In the case of an Incentive Stock Option

(A) granted to an Employee who, at the time of the grant of such Incentive Stock Option, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.

(B) granted to any Employee other than an Employee described in the preceding paragraph, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant.

(ii) In the case of a Nonstatutory Stock Option

(A) granted to a person who, at the time of the grant of such Option, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair Market Value per Share on the date of the grant.

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(B) granted to any person, the per Share exercise price shall be no less than 85% of the Fair Market Value per Share on the date of grant.

(iii) Notwithstanding the foregoing, Options may be granted with a per Share exercise price other than as required above pursuant to a merger or other corporate transaction.

(b) The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Administrator (and, in the case of an Incentive Stock Option, shall be determined at the time of grant) and may consist entirely of (1) cash, (2) check, (3) promissory note, (4) other Shares which (x) in the case of Shares acquired upon exercise of an Option have been owned by the Optionee for more than six months on the date of surrender and (y) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised, (5) delivery of a properly executed exercise notice together with such other documentation as the Administrator and the broker, if applicable, shall require to effect an exercise of the Option and delivery to the Company of the sale or loan proceeds required to pay the exercise price, or (6) any combination of the foregoing methods of payment. In making its determination as to the type of consideration to accept, the Board shall consider if acceptance of such consideration may be reasonably expected to benefit the Company.

9. Exercise of Option.

(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable at such times and under such conditions as determined by the Board, including performance criteria with respect to the Company and/or the Optionee, and as shall be permissible under the terms of the Plan, but in no case at a rate of less than 20% per year over five (5) years from the date the Option is granted.

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

An Option shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Option by the person entitled to exercise the Option and full payment for the Shares with respect to which the Option is exercised has been received by the Company. Full payment may, as authorized by the Board, consist of any consideration and method of payment allowable under Section 8(b) of the Plan. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the stock certificate evidencing such Shares, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such stock certificate promptly upon exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date the stock certificate is issued, except as provided in
Section 12 of the Plan.

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

(b) Termination of Employment or Consulting Relationship. In the event of termina tion of an Optionee's Continuous Status as an Employee or Consultant with the Company (but not in the event of an Optionee's change of status from Employee to Consultant (in which case an Employee's Incentive Stock Option shall automatically convert to a Nonstatutory Stock Option on the date three (3) months and one day from the date of such change of status) or from Consultant to Employee), such Optionee may, but only within such period of time as is determined by the Administrator, of at least thirty (30) days, with such determination in the case of an Incentive Stock Option not exceeding three (3) months after the date of such termination (but in no event later than the expiration date of the term of such Option as set forth in the Option Agreement), exercise his or her Option to the extent that Optionee was entitled to exercise it at the date of such termination. To the extent that Optionee was not entitled to exercise the Option at the date of such termination, or if Optionee does not exercise such Option to the extent so entitled within the time specified herein, the Option shall terminate.

(c) Disability of Optionee. In the event of termination of an Optionee's consulting relationship or Continuous Status as an Employee as a result of his or her disability, Optionee may, but only within twelve (12) months from the date of such termination (and in no event later than the expira tion date of the term of such Option as set forth in the Option Agreement), exercise the Option to the extent otherwise entitled to exercise it at the date of such termination; provided, however, that if such disability is not a "disability" as such term is defined in Section 22(e)(3) of the Code, in the case of an Incentive Stock Option such Incentive Stock Option shall automatically convert to a Nonstatutory Stock Option on the day three months and one day following such termination. To the extent that Optionee is not entitled to exercise the Option at the date of termination, or if Optionee does not exercise such Option to the extent so entitled within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(d) Death of Optionee. In the event of the death of an Optionee, the Option may be exercised at any time within twelve (12) months following the date of death (but in no event later than the expiration of the term of such Option as set forth in the Notice of Grant), by the Optionee's estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent that the Optionee was entitled to exercise the Option at the date of death. If, at the time of death, the Optionee was not entitled to exercise his or her entire Option, the Shares covered by the unexercisable portion of the Option shall immediately revert to the Plan. If, after death, the Optionee's estate or a person who acquired the right to exercise the Option by bequest or inheritance does not exercise the Option within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(e) Rule 16b-3. Options granted to persons subject to Section 16(b) of the Exchange Act must comply with Rule 16b-3 and shall contain such additional conditions or restrictions as may be

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required thereunder to qualify for the maximum exemption from Section 16 of the Exchange Act with respect to Plan transactions.

(f) Buyout Provisions. The Administrator may at any time offer to buy out for a payment in cash or Shares, an Option previously granted, based on such terms and conditions as the Administrator shall establish and communicate to the Optionee at the time that such offer is made.

10. Non-Transferability of Options. Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee.

11. Stock Purchase Rights.

(a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition to, or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it shall advise the offeree in writing or electronically of the terms, conditions and restrictions related to the offer, including the number of Shares that such person shall be entitled to purchase, the price to be paid, and the time within which such person must accept such offer. The terms of the offer shall comply in all respects with Section 260.140.42 of Title 10 of the California Code of Regulations. The offer shall be accepted by execution of a Restricted Stock purchase agreement in the form determined by the Administrator.

(b) Repurchase Option. Unless the Administrator determines otherwise, the Restricted Stock purchase agreement shall grant the Company a repurchase option exercisable upon the voluntary or involuntary termination of the purchaser's service with the Company for any reason (including death or disability). The purchase price for Shares repurchased pursuant to the Restricted Stock purchase agreement shall be the original price paid by the purchaser and may be paid by cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall lapse at such rate as the Administrator may determine, but in no case at a rate of less than 20% per year over five years from the date of purchase.

(c) Other Provisions. The Restricted Stock purchase agreement shall contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Administrator in its sole discretion.

(d) Rights as a Shareholder. Once the Stock Purchase Right is exercised, the purchaser shall have rights equivalent to those of a shareholder and shall be a shareholder when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment shall be made for a dividend or other right for which the record date is prior to the date the Stock Purchase Right is exercised, except as provided in Section 12 of the Plan.

12. Adjustments Upon Changes in Capitalization or Merger.

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(a) Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number of shares of Common Stock covered by each outstanding Option, and the number of shares of Common Stock which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option, as well as the price per share of Common Stock covered by each such outstanding Option, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combin ation or reclassification of the Common Stock, or any other increase or decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration." Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an Option.

(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Board shall notify the Optionee at least fifteen (15) days prior to such proposed action. To the extent it has not been previously exercised, the Option will terminate immediately prior to the consummation of such proposed action.

(c) Merger or Asset Sale. In the event of a merger of the Company with or into another corporation or the sale of substantially all of the assets of the Company, the Option may be assumed or an equivalent option may be substituted by such successor corporation or a parent or subsidiary of such successor corporation. If, in such event, the Option is not assumed or substituted, the Option shall terminate as of the date of the closing of the merger. For the purposes of this paragraph, the Option shall be considered assumed if, following the merger, the option confers the right to purchase, for each Share of Optioned Stock subject to the Option immediately prior to the merger, the consideration (whether stock, cash, or other securities or property) received in the merger by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the merger was not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of the Option for each Share of Optioned Stock subject to the Option to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders of Common Stock in the merger.

13. Time of Granting Options. The date of grant of an Option shall, for all purposes, be the date on which the Administrator makes the determination granting such Option, or such other date as is determined by the Board. Notice of the determination shall be given to each Employee or Consultant to whom an Option is so granted within a reasonable time after the date of such grant.

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14. Amendment and Termination of the Plan.

(a) Amendment and Termination. The Board may at any time amend, alter, suspend or discontinue the Plan, but no amendment, alteration, suspension or discontinuation shall be made which would impair the rights of any Optionee under any grant theretofore made, without his or her consent. In addition, to the extent necessary and desirable to comply with Rule 16b-3 under the Exchange Act or with Section 422 of the Code (or any other applicable law or regulation, including the requirements of the NASD or an established stock exchange), the Company shall obtain shareholder approval of any Plan amendment in such a manner and to such a degree as required.

(b) Effect of Amendment or Termination. Any such amendment or termination of the Plan shall not affect Options already granted, and such Options shall remain in full force and effect as if this Plan had not been amended or terminated, unless mutually agreed otherwise between the Optionee and the Board, which agreement must be in writing and signed by the Optionee and the Company.

15. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. As a condition to the exercise of an Option, the Company may require the person exercising such Option to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned relevant provisions of law.

16. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

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

The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

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18. Agreements. Options shall be evidenced by written agreements in such form as the Board shall approve from time to time.

19. Shareholder Approval. Continuance of the Plan shall be subject to approval by the shareholders of the Company within twelve (12) months before or after the date the Plan is adopted. Such shareholder approval shall be obtained in the degree and manner required under applicable state and federal law and the rules of any stock exchange upon which the Common Stock is listed.

20. Information to Optionees and Purchasers. The Company shall provide to each Optionee, not less frequently than annually, copies of annual financial statements. The Company shall also provide such statements to each individual who acquires Shares pursuant to the Plan while such individual owns such Shares. The Company shall not be required to provide such statements to key employees whose duties in connection with the Company assure their access to equivalent information.

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SAGENT TECHNOLOGY, INC.
AMENDED 1995 STOCK PLAN

STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Option Agreement.

I. NOTICE OF STOCK OPTION GRANT

Name of Optionee:                   optionee
Address of Optionee:                street address
                                    city, state zip

You have been granted an option to purchase Common Stock of the Company, subject to the terms and conditions of the Plan and this Option Agreement, as follows:

Grant Number                       grant no.

Date of Grant                      grant date

Vesting Commencement Date          vesting date

Exercise Price per Share           $exercise price

Total Number of Shares Granted     no. shares

Total Exercise Price               $total exercise price

Type of Option:                    [X]  Incentive Stock Option

                                   [ ]  Nonstatutory Stock Option

Term/Expiration Date:              term date

Vesting Schedule:

This Option may be exercised, in whole or in part, in accordance with the following schedule:

25% of the Shares subject to the Option shall vest twelve months after the Vesting Commencement Date, and 1/48 of the Shares subject to the Option shall vest each month

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thereafter, subject to the Optionee continuing to be an employee or consultant (a "Service Provider"), as the case may be, on such dates.

Notwithstanding the foregoing, this Option is exercisable immediately, in whole or in part, conditioned upon Optionee entering into a Restricted Stock Purchase Agreement attached hereto as Exhibit A-1 with respect to any unvested Shares subject to the Option.

Termination Period:

This Option may be exercised for ninety (90) days after Optionee ceases to be a Service Provider. Upon the death or Disability of the Optionee, this Option may be exercised for one year after Optionee ceases to be a Service Provider. In no event shall this Option be exercised later than the Term/Expiration Date as provided above.

II. AGREEMENT

1. Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant in Section I of this Option Agreement (the "Optionee") an option (the "Option") to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise price per share set forth in the Notice of Grant (the "Exercise Price"), subject to the terms and conditions of the Plan, which is incorporated herein by reference, and this Option Agreement. In the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Option Agreement, the terms and conditions of the Plan shall prevail.

If designated in the Notice of Grant as an Incentive Stock Option ("ISO"), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive Stock Option, to the extent that it exceeds the $100,000 rule of Code Section 422(d) it shall be treated as a Nonstatutory Stock Option ("NSO").

2. Exercise of Option.

(a) Right to Exercise. This Option is exercisable during its term in accordance with the Vesting Schedule set out in the Notice of Grant and the applicable provisions of the Plan and this Option Agreement.

(b) Method of Exercise. This Option is exercisable by delivery of an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"), which shall state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the "Exercised Shares"), and such other representations and agreements as may be required by the Company pursuant to the provisions of the Plan. The Exercise Notice shall be completed by the Optionee and delivered to the Controller of the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option

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shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate Exercise Price.

No Shares shall be issued pursuant to the exercise of this Option unless such issuance and exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Exercised Shares shall be considered transferred to the Optionee on the date the Option is exercised with respect to such Exercised Shares.

3. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the following, or a combination thereof, at the election of the Optionee:

(a) cash; or

(b) check; or

(c) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan; or

(d) surrender of other Shares which (i) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six (6) months on the date of surrender, and (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares; or

(e) with the Administrator's consent, delivery of Optionee's promissory note (the "Note") in the form attached hereto as Exhibit C, in the amount of the aggregate Exercise Price of the Exercised Shares together with the execution and delivery by the Optionee of the Security Agreement attached hereto as Exhibit B. The Note shall bear interest at the "applicable federal rate" prescribed under the Code and its regulations at time of purchase, and shall be secured by a pledge of the Shares purchased by the Note pursuant to the Security Agreement.

4. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent or distribution and may be exercised during the lifetime of Optionee only by the Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee.

5. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option Agreement.

6. Termination of Relationship. In the event an Optionee's Continuous Status as an Employee or Consultant terminates, Optionee may, to the extent otherwise so entitled at the date of such termination (the "Termination Date"), exercise this Option during the Termination Period set out in the Notice of Grant. To the extent that Optionee was not entitled to exercise this Option

-3-

at the date of such termination, or if Optionee does not exercise this Option within the time specified herein, the Option shall terminate.

7. Tax Consequences. Some of the federal tax consequences relating to this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

(a) Exercising the Option.

(i) Nonstatutory Stock Option. The Optionee may incur regular federal income tax liability upon exercise of a NSO. The Optionee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price. If the Optionee is an Employee or a former Employee, the Company will be required to withhold from his or her compensation or collect from Optionee and pay to the applicable taxing authorities an amount in cash equal to a percentage of this compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise.

(ii) Incentive Stock Option. If this Option qualifies as an ISO, the Optionee will have no regular federal income tax liability upon its exercise, although the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price will be treated as an adjustment to alternative minimum taxable income for federal tax purposes and may subject the Optionee to alternative minimum tax in the year of exercise. In the event that the Optionee ceases to be an Employee but remains a Service Provider, any Incentive Stock Option of the Optionee that remains unexercised shall cease to qualify as an Incentive Stock Option and will be treated for tax purposes as a Nonstatutory Stock Option on the date three (3) months and one (1) day following such change of status.

(b) Disposition of Shares.

(i) NSO. If the Optionee holds NSO Shares for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes.

(ii) ISO. If the Optionee holds ISO Shares for at least one year after exercise and two years after the grant date, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. If the Optionee disposes of ISO Shares within one year after exercise or two years after the grant date, any gain realized on such disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the lesser of (A) the difference between the Fair Market Value of the Shares

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acquired on the date of exercise and the aggregate Exercise Price, or (B) the difference between the sale price of such Shares and the aggregate Exercise Price. Any additional gain will be taxed as capital gain, short-term or long-term depending on the period that the ISO Shares were held.

(c) Notice of Disqualifying Disposition of ISO Shares. If the Optionee sells or otherwise disposes of any of the Shares acquired pursuant to an ISO on or before the later of (i) two years after the grant date, or (ii) one year after the exercise date, the Optionee shall immediately notify the Company in writing of such disposition. The Optionee agrees that he or she may be subject to income tax withholding by the Company on the compensation income recognized from such early disposition of ISO Shares by payment in cash or out of the current earnings paid to the Optionee.

8. Market Standoff Agreement. Optionee hereby agrees that if so requested by the Company or any representative of the underwriters in connection with any registration of the offering of any securities of the Company under the Securities Act, Optionee shall not sell or otherwise transfer any Shares or other securities of the Company during the 180-day period following the effective date of a registration statement of the Company filed under the Securities Act; provided, however, that such restriction shall only apply to the first registration statement of the Company to become effective under the Securities Act which include securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of such 180-day period.

9. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee's interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws, but not the choice of law rules, of California.

10. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

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[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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By your signature and the signature of the Company's representative below, you and the Company agree that this Option is granted under and governed by the terms and conditions of the Plan and this Option Agreement. Optionee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option Agreement and fully understands all provisions of the Plan and Option Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Option Agreement. Optionee further agrees to notify the Company upon any change in the residence address indicated below.

OPTIONEE:                                    SAGENT TECHNOLOGY, INC.:



                                             By:
-------------------------------                 -------------------------------
Signature


-------------------------------              ----------------------------------
Print Name                                   Print Name


-------------------------------              ----------------------------------
Residence Address                            Title

-------------------------------

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CONSENT OF SPOUSE

The undersigned spouse of optionee (the "Optionee") has read and hereby approves the terms and conditions of the Plan and this Option Agreement. In consideration of the Company's granting his or her spouse the right to purchase Shares as set forth in the Plan and this Option Agreement, the undersigned hereby agrees to be irrevocably bound by the terms and conditions of the Plan and this Option Agreement and further agrees that any community property interest shall be similarly bound. The undersigned hereby appoints the undersigned's spouse as attorney-in-fact for the undersigned with respect to any amendment or exercise of rights under the Plan or this Option Agreement.


Spouse of Optionee

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EXHIBIT A

EXERCISE NOTICE

Sagent Technology, Inc.
2225 East Bayshore, Suite 100
Palo Alto, CA 94303

Attention: Controller

1. Exercise of Option. Effective as of today, ________________, 199__, the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of Sagent Technology, Inc. (the "Company") under and pursuant to the Amended 1995 Stock Plan (the "Plan") and the Stock Option Agreement dated , 199__ (the "Option Agreement"). The purchase price for the Shares shall be $ , as required by the Option Agreement.

2. Delivery of Payment. Purchaser herewith delivers to the Company the full purchase price for the Shares.

3. Representations of Purchaser. Purchaser acknowledges that Purchaser has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions.

4. Rights as Shareholder. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the Shares, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares so acquired shall be issued to the Optionee as soon as practicable after exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date of issuance, except as provided in Section 12 of the Plan.

5. Tax Consultation. Purchaser understands that Purchaser may suffer adverse tax consequences as a result of Purchaser's purchase or disposition of the Shares. Purchaser represents that Purchaser has consulted with any tax consultants Purchaser deems advisable in connection with the purchase or disposition of the Shares and that Purchaser is not relying on the Company for any tax advice.

6. Entire Agreement; Governing Law. The Plan and Option Agreement are incorporated herein by reference. This Agreement, the Plan and the Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all

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prior undertakings and agreements of the Company and Purchaser with respect to the subject matter hereof, and may not be modified adversely to the Purchaser's interest except by means of a writing signed by the Company and Purchaser. This agreement is governed by the internal substantive laws, but not the choice of law rules, of California.

Submitted by:                                Accepted by:

PURCHASER:                                   SAGENT TECHNOLOGY, INC.:


                                             By:
-------------------------------                 -------------------------------
Signature
                                             Name:
                                                  -----------------------------

-------------------------------
Print Name                                   Title:
                                                   ----------------------------


Address:                                     Address:

                                             2225 E. Bayshore Road, Suite 100
-------------------------------

                                             Palo Alto, CA  94303
-------------------------------


Date Received

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EXHIBIT A-1

RESTRICTED STOCK PURCHASE AGREEMENT

Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Restricted Stock Purchase Agreement.

WHEREAS the Purchaser named in the Notice of Grant, (the "Purchaser") is an employee of or consultant to the Company (a "Service Provider"), and the Purchaser's continued participation is considered by the Company to be important for the Company's continued growth; and

WHEREAS in order to give the Purchaser an opportunity to acquire an equity interest in the Company as an incentive for the Purchaser to participate in the affairs of the Company, the Admin istrator has granted to the Purchaser a Stock Purchase Right subject to the terms and conditions of the Plan and the Notice of Grant, which are incorporated herein by reference, and pursuant to this Restricted Stock Purchase Agreement (the "Agreement").

NOW THEREFORE, the parties agree as follows:

1. Sale of Stock. The Company hereby agrees to sell to the Purchaser and the Purchaser hereby agrees to purchase shares of the Company's Common Stock (the "Shares"), at the per Share purchase price and as otherwise described in the Notice of Grant.

2. Payment of Purchase Price. The purchase price for the Shares may be paid by delivery to the Company at the time of execution of this Agreement of cash, a check, or some combination thereof.

3. Repurchase Option.

(a) In the event the Purchaser ceases to be a Service Provider for any or no reason (including death or disability) before all of the Shares are released from the Company's Repurchase Option (see Section 4), the Company shall, upon the date of such termination (as reasonably fixed and determined by the Company) have an irrevocable, exclusive option (the "Repurchase Option") for a period of ninety (90) days from such date to repurchase up to that number of shares which constitute the Unreleased Shares (as defined in Section 4) at the original purchase price per share (the "Repurchase Price"). The Repurchase Option shall be exercised by the Company by delivering written notice to the Purchaser or the Purchaser's executor (with a copy to the Escrow Holder) AND, at the Company's option, (i) by delivering to the Purchaser or the Purchaser's executor a check in the amount of the aggregate Repurchase Price, or (ii) by canceling an amount of the Purchaser's indebtedness to the Company equal to the aggregate Repurchase Price, or (iii) by a combination of (i) and (ii) so that the combined payment and cancellation of indebtedness equals the aggregate Repurchase Price. Upon delivery of such notice and the payment of the aggregate Repurchase Price,

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the Company shall become the legal and beneficial owner of the Shares being repurchased and all rights and interests therein or relating thereto, and the Company shall have the right to retain and transfer to its own name the number of Shares being repurchased by the Company.

(b) Whenever the Company shall have the right to repurchase Shares hereunder, the Company may designate and assign one or more employees, officers, directors or shareholders of the Company or other persons or organizations to exercise all or a part of the Company's purchase rights under this Agreement and purchase all or a part of such Shares. If the Fair Market Value of the Shares to be repurchased on the date of such designation or assignment (the "Repurchase FMV") exceeds the aggregate Repurchase Price of such Shares, then each such designee or assignee shall pay the Company cash equal to the difference between the Repurchase FMV and the aggregate Repurchase Price of such Shares.

[4. RELEASE OF SHARES FROM REPURCHASE OPTION. [INDIVIDUALIZED ACCORDING

TO VESTING SCHEDULE].

(a) TWENTY-FIVE PERCENT (25%) OF THE SHARES SHALL BE RELEASED FROM THE COMPANY'S REPURCHASE OPTION ONE YEAR AFTER THE VESTING COMMENCEMENT DATE AND ONE FORTY-EIGHTH (1/48TH) OF THE SHARES AT THE END OF EACH MONTH THEREAFTER, PROVIDED THAT THE PURCHASER DOES NOT CEASE TO BE A SERVICE PROVIDER PRIOR TO THE DATE OF ANY SUCH RELEASE.

(b) ANY OF THE SHARES THAT HAVE NOT YET BEEN RELEASED FROM THE REPURCHASE OPTION ARE REFERRED TO HEREIN AS "UNRELEASED SHARES."

(c) THE SHARES THAT HAVE BEEN RELEASED FROM THE REPURCHASE OPTION SHALL BE DELIVERED TO THE PURCHASER AT THE PURCHASER'S REQUEST (SEE SECTION 6).]

5. Restriction on Transfer. Except for the escrow described in Section 6 or the transfer of the Shares to the Company or its assignees contemplated by this Agreement, none of the Shares or any beneficial interest therein shall be transferred, encumbered or otherwise disposed of in any way until such Shares are released from the Company's Repurchase Option in accordance with the provisions of this Agreement, other than by will or the laws of descent and distribution.

6. Escrow of Shares.

(a) To ensure the availability for delivery of the Purchaser's Unreleased Shares upon repurchase by the Company pursuant to the Repurchase Option, the Purchaser shall, upon execution of this Agreement, deliver and deposit with an escrow holder designated by the Company (the "Escrow Holder") the share certificates representing the Unreleased Shares, together with the stock assignment duly endorsed in blank, attached hereto as Exhibit A-2. The Unreleased Shares and stock assignment shall be held by the Escrow Holder, pursuant to the Joint Escrow Instructions of the Company and Purchaser attached hereto as Exhibit A-3, until such time as the Company's Repurchase Option expires. As a further condition to the Company's obligations under this

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Agreement, the Company may require the spouse of Purchaser, if any, to execute and deliver to the Company the Consent of Spouse attached hereto as Exhibit A-4.

(b) The Escrow Holder shall not be liable for any act it may do or omit to do with respect to holding the Unreleased Shares in escrow while acting in good faith and in the exercise of its judgment.

(c) If the Company or any assignee exercises the Repurchase Option hereunder, the Escrow Holder, upon receipt of written notice of such exercise from the proposed transferee, shall take all steps necessary to accomplish such transfer.

(d) When the Repurchase Option has been exercised or expires unexercised or a portion of the Shares has been released from the Repurchase Option, upon request the Escrow Holder shall promptly cause a new certificate to be issued for the released Shares and shall deliver the certificate to the Company or the Purchaser, as the case may be.

(e) Subject to the terms hereof, the Purchaser shall have all the rights of a shareholder with respect to the Shares while they are held in escrow, including without limitation, the right to vote the Shares and to receive any cash dividends declared thereon. If, from time to time during the term of the Repurchase Option, there is (i) any stock dividend, stock split or other change in the Shares, or (ii) any merger or sale of all or substantially all of the assets or other acquisition of the Company, any and all new, substituted or additional securities to which the Purchaser is entitled by reason of the Purchaser's ownership of the Shares shall be immediately subject to this escrow, deposited with the Escrow Holder and included thereafter as "Shares" for purposes of this Agreement and the Repurchase Option.

7. Legends. The share certificate evidencing the Shares, if any, issued hereunder shall be endorsed with the following legend (in addition to any legend required under applicable state securities laws):

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS UPON TRANSFER AND RIGHTS OF REPURCHASE AS SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE SHAREHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

8. Adjustment for Stock Split. All references to the number of Shares and the purchase price of the Shares in this Agreement shall be appropriately adjusted to reflect any stock split, stock dividend or other change in the Shares which may be made by the Company after the date of this Agreement.

9. Tax Consequences. The Purchaser has reviewed with the Purchaser's own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement. The Purchaser is relying solely on such advisors and not on any

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statements or representations of the Company or any of its agents. The Purchaser understands that the Purchaser (and not the Company) shall be responsible for the Purchaser's own tax liability that may arise as a result of the transactions contemplated by this Agreement. The Purchaser understands that Section 83 of the Internal Revenue Code of 1986, as amended (the "Code"), taxes as ordinary income the difference between the purchase price for the Shares and the Fair Market Value of the Shares as of the date any restrictions on the Shares lapse. In this context, "restriction" includes the right of the Company to buy back the Shares pursuant to the Repurchase Option. The Purchaser understands that the Purchaser may elect to be taxed at the time the Shares are purchased rather than when and as the Repurchase Option expires by filing an election under Section 83(b) of the Code with the IRS within 30 days from the date of purchase. The form for making this election is attached as Exhibit A-5 hereto.

THE PURCHASER ACKNOWLEDGES THAT IT IS THE PURCHASER'S SOLE RESPONSIBILITY AND NOT THE COMPANY'S TO FILE TIMELY THE ELECTION UNDER SECTION
83(b), EVEN IF THE PURCHASER REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON THE PURCHASER'S BEHALF.

10. General Provisions.

(a) This Agreement shall be governed by the internal substantive laws, but not the choice of law rules, of California. This Agreement, subject to the terms and conditions of the Plan and the Notice of Grant, represents the entire agreement between the parties with respect to the purchase of the Shares by the Purchaser. Subject to Section 15(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Agreement, the terms and conditions of the Plan shall prevail. Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Agreement.

(b) Any notice, demand or request required or permitted to be given by either the Company or the Purchaser pursuant to the terms of this Agreement shall be in writing and shall be deemed given when delivered personally or deposited in the U.S. mail, First Class with postage prepaid, and addressed to the parties at the addresses of the parties set forth at the end of this Agreement or such other address as a party may request by notifying the other in writing.

Any notice to the Escrow Holder shall be sent to the Company's address with a copy to the other party hereto.

(c) The rights of the Company under this Agreement shall be transferable to any one or more persons or entities, and all covenants and agreements hereunder shall inure to the benefit of, and be enforceable by the Company's successors and assigns. The rights and obligations of the Purchaser under this Agreement may only be assigned with the prior written consent of the Company.

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(d) Either party's failure to enforce any provision of this Agreement shall not in any way be construed as a waiver of any such provision, nor prevent that party from thereafter enforcing any other provision of this Agreement. The rights granted both parties hereunder are cumulative and shall not constitute a waiver of either party's right to assert any other legal remedy available to it.

(e) The Purchaser agrees upon request to execute any further documents or instruments necessary or desirable to carry out the purposes or intent of this Agreement.

(f) PURCHASER ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO SECTION 4 HEREOF IS EARNED ONLY BY CONTINUING SERVICE AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED OR PURCHASING SHARES HEREUNDER). PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH PURCHASER'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE PURCHASER'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

By Purchaser's signature below, Purchaser represents that he or she is familiar with the terms and provisions of the Plan, and hereby accepts this Agreement subject to all of the terms and provisions thereof. Purchaser has reviewed the Plan and this Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Agreement and fully understands all provisions of this Agreement. Purchaser agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or this Agreement. Purchaser further agrees to notify the Company upon any change in the residence indicated in the Notice of Grant.

DATED:
      ------------------

PURCHASER:                                   SAGENT TECHNOLOGY, INC.:


                                             By:
-------------------------------                 -------------------------------
Signature
                                             Name:
                                                  -----------------------------

-------------------------------
Print Name                                   Title:
                                                   ----------------------------

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EXHIBIT A-2

ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED I, __________________________, hereby sell, assign and transfer unto ______________________________ (__________) shares of the Common Stock of Sagent Technology, Inc. standing in my name of the books of said corporation represented by Certificate No. _____ herewith and do hereby irrevocably constitute and appoint _________ to transfer the said stock on the books of the within named corporation with full power of substitution in the premises.

This Stock Assignment may be used only in accordance with the Restricted Stock Purchase Agreement (the "Agreement") between________________________ and the undersigned dated ______________, 19__.

Dated:                , 19
       ---------------

                                      Signature:
                                                -------------------------------

INSTRUCTIONS: Please do not fill in any blanks other than the signature line. The purpose of this assignment is to enable the Company to exercise the Repurchase Option, as set forth in the Agreement, without requiring additional signatures on the part of the Purchaser.

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EXHIBIT A-3

JOINT ESCROW INSTRUCTIONS

________, 19__

Corporate Secretary
Sagent Technology, Inc.

Dear___________:

As Escrow Agent for both Sagent Technology, Inc. a California corporation (the "Company"), and the undersigned purchaser of stock of the Company (the "Purchaser"), you are hereby authorized and directed to hold the documents delivered to you pursuant to the terms of that certain Restricted Stock Purchase Agreement ("Agreement") between the Company and the undersigned, in accordance with the following instructions:

1. In the event the Company and/or any assignee of the Company (referred to collectively as the "Company") exercises the Company's Repurchase Option set forth in the Agreement, the Company shall give to Purchaser and you a written notice specifying the number of shares of stock to be purchased, the purchase price, and the time for a closing hereunder at the principal office of the Company. Purchaser and the Company hereby irrevocably authorize and direct you to close the transaction contemplated by such notice in accordance with the terms of said notice.

2. At the closing, you are directed (a) to date the stock assignments necessary for the transfer in question, (b) to fill in the number of shares being transferred, and (c) to deliver same, together with the certificate evidencing the shares of stock to be transferred, to the Company or its assignee, against the simultaneous delivery to you of the purchase price (by cash, a check, or some combination thereof) for the number of shares of stock being purchased pursuant to the exercise of the Company's Repurchase Option.

3. Purchaser irrevocably authorizes the Company to deposit with you any certificates evidencing shares of stock to be held by you hereunder and any additions and substitutions to said shares as defined in the Agreement. Purchaser does hereby irrevocably constitute and appoint you as Purchaser's attorney-in-fact and agent for the term of this escrow to execute with respect to such securities all documents necessary or appropriate to make such securities negotiable and to complete any transaction herein contemplated, including but not limited to the filing with any applicable state blue sky authority of any required applications for consent to, or notice of transfer of, the securities.

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Subject to the provisions of this paragraph 3, Purchaser shall exercise all rights and privileges of a shareholder of the Company while the stock is held by you.

4. Upon written request of the Purchaser, but no more than once per calendar year, unless the Company's Repurchase Option has been exercised, you shall deliver to Purchaser a certificate or certificates representing so many shares of stock as are not then subject to the Company's Repurchase Option. Within 90 days after Purchaser ceases to be a Service Provider, you shall deliver to Purchaser a certificate or certificates representing the aggregate number of shares held or issued pursuant to the Agreement and not purchased by the Company or its assignees pursuant to exercise of the Company's Repurchase Option.

5. If at the time of termination of this escrow you should have in your possession any documents, securities, or other property belonging to Purchaser, you shall deliver all of the same to Purchaser and shall be discharged of all further obligations hereunder.

6. Your duties hereunder may be altered, amended, modified or revoked only by a writing signed by all of the parties hereto.

7. You shall be obligated only for the performance of such duties as are specifically set forth herein and may rely and shall be protected in relying or refraining from acting on any instrument reasonably believed by you to be genuine and to have been signed or presented by the proper party or parties. You shall not be personally liable for any act you may do or omit to do hereunder as Escrow Agent or as attorney-in-fact for Purchaser while acting in good faith, and any act done or omitted by you pursuant to the advice of your own attorneys shall be conclusive evidence of such good faith.

8. You are hereby expressly authorized to disregard any and all warnings given by any of the parties hereto or by any other person or corporation, excepting only orders or process of courts of law, and are hereby expressly authorized to comply with and obey orders, judgments or decrees of any court. In case you obey or comply with any such order, judgment or decree, you shall not be liable to any of the parties hereto or to any other person, firm or corporation by reason of such compliance, notwithstanding any such order, judgment or decree being subsequently reversed, modified, annulled, set aside, vacated or found to have been entered without jurisdiction.

9. You shall not be liable in any respect on account of the identity, authorities or rights of the parties executing or delivering or purporting to execute or deliver the Agreement or any documents or papers deposited or called for hereunder.

10. You shall not be liable for the outlawing of any rights under the statute of limitations with respect to these Joint Escrow Instructions or any documents deposited with you.

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11. You shall be entitled to employ such legal counsel and other experts as you may deem necessary properly to advise you in connection with your obligations hereunder, may rely upon the advice of such counsel, and may pay such counsel reasonable compensation therefor.

12. Your responsibilities as Escrow Agent hereunder shall terminate if you shall cease to be an officer or agent of the Company or if you shall resign by written notice to each party. In the event of any such termination, the Company shall appoint a successor Escrow Agent.

13. If you reasonably require other or further instruments in connection with these Joint Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join in furnishing such instruments.

14. It is understood and agreed that should any dispute arise with respect to the delivery and/or ownership or right of possession of the securities held by you hereunder, you are authorized and directed to retain in your possession without liability to anyone all or any part of said securities until such disputes shall have been settled either by mutual written agreement of the parties concerned or by a final order, decree or judgment of a court of competent jurisdiction after the time for appeal has expired and no appeal has been perfected, but you shall be under no duty whatsoever to institute or defend any such proceedings.

15. Any notice required or permitted hereunder shall be given in writing and shall be deemed effectively given upon personal delivery or upon deposit in the United States Post Office, by registered or certified mail with postage and fees prepaid, addressed to each of the other parties thereunto entitled at the following addresses or at such other addresses as a party may designate by ten days' advance written notice to each of the other parties hereto.

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COMPANY:            Sagent Technology, Inc.
                    2225 E. Bayshore Road, Suite 100
                    Palo Alto, CA  94303


PURCHASER:
                    -------------------------------

                    -------------------------------

                    -------------------------------

ESCROW AGENT:




16. By signing these Joint Escrow Instructions, you become a party hereto only for the purpose of said Joint Escrow Instructions; you do not become a party to the Agreement.

17. This instrument shall be binding upon and inure to the benefit of the parties hereto, and their respective successors and permitted assigns.

18. These Joint Escrow Instructions shall be governed by, and construed and enforced in accordance with, the internal substantive laws, but not the choice of law rules, of California.

Very truly yours,

SAGENT TECHNOLOGY, INC.

By:

Name:

Title:

PURCHASER:


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Signature


Print Name

ESCROW AGENT:


Corporate Secretary

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EXHIBIT A-4

CONSENT OF SPOUSE

I, ____________________, spouse of ___________________, have read and approve the foregoing Restricted Stock Purchase Agreement (the "Agreement"). In consideration of the Company's grant to my spouse of the right to purchase shares of Sagent Technology, Inc., as set forth in the Agreement, I hereby appoint my spouse as my attorney-in-fact in respect to the exercise of any rights under the Agreement and agree to be bound by the provisions of the Agreement insofar as I may have any rights in said Agreement or any shares issued pursuant thereto under the community property laws or similar laws relating to marital property in effect in the state of our residence as of the date of the signing of the foregoing Agreement.

Dated: _______________, 19__


Signature of Spouse

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EXHIBIT A-5

ELECTION UNDER SECTION 83(b)
OF THE INTERNAL REVENUE CODE OF 1986

The undersigned taxpayer hereby elects, pursuant to Sections 55 and 83(b) of the Internal Revenue Code of 1986, as amended, to include in taxpayer's gross income or alternative minimum taxable income, as the case may be, for the current taxable year the amount of any compensation taxable to taxpayer in connection with taxpayer's receipt of the property described below:

1. The name, address, taxpayer identification number and taxable year of the undersigned are as follows:

NAME:                      TAXPAYER:                        SPOUSE:

ADDRESS:

IDENTIFICATION NO.:        TAXPAYER:                        SPOUSE:

TAXABLE YEAR:

2. The property with respect to which the election is made is described as follows: ________ shares (the "Shares") of the Common Stock of Sagent Technology, Inc. (the "Company").

3. The date on which the property was transferred is:________, 19 ____.

4. The property is subject to the following restrictions:

The Shares may not be transferred and are subject to forfeiture under the terms of an agreement between the taxpayer and the Company. These restrictions lapse upon the satisfaction of certain conditions contained in such agreement.

5. The fair market value at the time of transfer, determined without regard to any restriction other than a restriction which by its terms will never lapse, of such property is:
$____________________.

6. The amount (if any) paid for such property is:
$____________________.

The undersigned has submitted a copy of this statement to the person for whom the services were performed in connection with the undersigned's receipt of the above-described property. The transferee of such property is the person performing the services in connection with the transfer of said property.

The undersigned understands that the foregoing election may not be revoked except with the consent of the Commissioner.

Dated: ___________________, 19____ _____________________________________

Taxpayer

The undersigned spouse of taxpayer joins in this election.

Dated: ___________________, 19____ _____________________________________ Spouse of Taxpayer


EXHIBIT B

SECURITY AGREEMENT

This Security Agreement is made as of __________, 19___ between Sagent Technology, Inc., a California corporation ("Pledgee"), and _________________________ ("Pledgor").

Recitals

Pursuant to Pledgor's election to purchase Shares under the Option Agreement dated ________ (the "Option"), between Pledgor and Pledgee under Pledgee's 1995 Stock Plan, as may be amended from time to time, and Pledgor's election under the terms of the Option to pay for such shares with his promissory note (the "Note"), Pledgor has purchased _________ shares of Pledgee's Common Stock (the "Shares") at a price of $________ per share, for a total purchase price of $__________. The Note and the obligations thereunder are as set forth in Exhibit C to the Option.

NOW, THEREFORE, it is agreed as follows:

1. Creation and Description of Security Interest. In consideration of the transfer of the Shares to Pledgor under the Option Agreement, Pledgor, pursuant to the California Commercial Code, hereby pledges all of such Shares (herein sometimes referred to as the "Collateral") represented by certificate number ______, duly endorsed in blank or with executed stock powers, and herewith delivers said certificate to the Secretary of Pledgee ("Pledgeholder"), who shall hold said certificate subject to the terms and conditions of this Security Agreement.

The pledged stock (together with an executed blank stock assignment for use in transferring all or a portion of the Shares to Pledgee if, as and when required pursuant to this Security Agreement) shall be held by the Pledgeholder as security for the repayment of the Note, and any extensions or renewals thereof, to be executed by Pledgor pursuant to the terms of the Option, and the Pledgeholder shall not encumber or dispose of such Shares except in accordance with the provisions of this Security Agreement.

2. Pledgor's Representations and Covenants. To induce Pledgee to enter into this Security Agreement, Pledgor represents and covenants to Pledgee, its successors and assigns, as follows:

a. Payment of Indebtedness. Pledgor will pay the principal sum of the Note secured hereby, together with interest thereon, at the time and in the manner provided in the Note.


b. Encumbrances. The Shares are free of all other encumbrances, defenses and liens, and Pledgor will not further encumber the Shares without the prior written consent of Pledgee.

c. Margin Regulations. In the event that Pledgee's Common Stock is now or later becomes margin-listed by the Federal Reserve Board and Pledgee is classified as a "lender" within the meaning of the regulations under Part 207 of Title 12 of the Code of Federal Regulations ("Regulation G"), Pledgor agrees to cooperate with Pledgee in making any amendments to the Note or providing any additional collateral as may be necessary to comply with such regulations.

3. Voting Rights. During the term of this pledge and so long as all payments of principal and interest are made as they become due under the terms of the Note, Pledgor shall have the right to vote all of the Shares pledged hereunder.

4. Stock Adjustments. In the event that during the term of the pledge any stock dividend, reclassification, readjustment or other changes are declared or made in the capital structure of Pledgee, all new, substituted and additional shares or other securities issued by reason of any such change shall be delivered to and held by the Pledgee under the terms of this Security Agreement in the same manner as the Shares originally pledged hereunder. In the event of substitution of such securities, Pledgor, Pledgee and Pledgeholder shall cooperate and execute such documents as are reasonable so as to provide for the substitution of such Collateral and, upon such substitution, references to "Shares" in this Security Agreement shall include the substituted shares of capital stock of Pledgor as a result thereof.

5. Options and Rights. In the event that, during the term of this pledge, subscription Options or other rights or options shall be issued in connection with the pledged Shares, such rights, Options and options shall be the property of Pledgor and, if exercised by Pledgor, all new stock or other securities so acquired by Pledgor as it relates to the pledged Shares then held by Pledgeholder shall be immediately delivered to Pledgeholder, to be held under the terms of this Security Agreement in the same manner as the Shares pledged.

6. Default. Pledgor shall be deemed to be in default of the Note and of this Security Agreement in the event:

a. Payment of principal or interest on the Note shall be delinquent for a period of 10 days or more; or

b. Pledgor fails to perform any of the covenants set forth in the Option or contained in this Security Agreement for a period of 10 days after written notice thereof from Pledgee.

In the case of an event of Default, as set forth above, Pledgee shall have the right to accelerate payment of the Note upon notice to Pledgor, and Pledgee shall thereafter be entitled to pursue its remedies under the California Commercial Code.

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7. Release of Collateral. Subject to any applicable contrary rules under Regulation G, there shall be released from this pledge a portion of the pledged Shares held by Pledgeholder here under upon payments of the principal of the Note. The number of the pledged Shares which shall be released shall be that number of full Shares which bears the same proportion to the initial number of Shares pledged hereunder as the payment of principal bears to the initial full principal amount of the Note.

8. Withdrawal or Substitution of Collateral. Pledgor shall not sell, withdraw, pledge, substitute or otherwise dispose of all or any part of the Collateral without the prior written consent of Pledgee.

9. Term. The pledge of Shares shall continue until the payment of all indebtedness secured hereby, at which time the remaining pledged stock shall be promptly delivered to Pledgor, subject to the provisions for prior release of a portion of the Collateral as provided in paragraph 7 above.

10. Insolvency. Pledgor agrees that if a bankruptcy or insolvency proceeding is instituted by or against it, or if a receiver is appointed for the property of Pledgor, or if Pledgor makes an assignment for the benefit of creditors, the entire amount unpaid on the Note shall become immediately due and payable, and Pledgee may proceed as provided in the case of default.

11. Pledgeholder Liability. In the absence of willful or gross negligence, Pledgeholder shall not be liable to any party for any of his acts, or omissions to act, as Pledgeholder.

12. Invalidity of Particular Provisions. Pledgor and Pledgee agree that the enforceability or invalidity of any provision or provisions of this Security Agreement shall not render any other provision or provisions herein contained unenforceable or invalid.

13. Successors or Assigns. Pledgor and Pledgee agree that all of the terms of this Security Agreement shall be binding on their respective successors and assigns, and that the term "Pledgor" and the term "Pledgee" as used herein shall be deemed to include, for all purposes, the respective designees, successors, assigns, heirs, executors and administrators.

14. Governing Law. This Security Agreement shall be interpreted and governed under the internal substantive laws, but not the choice of law rules, of California.

[THIS SPACE INTENTIONALLY LEFT BLANK.]

-3-

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

"PLEDGOR"                           ___________________________________
                                    Signature

                                    ___________________________________
                                    Print Name

                        Address:    ___________________________________

                                    ___________________________________


"PLEDGEE"                           SAGENT TECHNOLOGY, INC.
                                    a California corporation


                                    ___________________________________
                                    Signature

                                    ___________________________________
                                    Print Name

                                    ___________________________________
                                    Title


"PLEDGEHOLDER"
                                    ___________________________________
                                    Secretary of
                                    Sagent Technology, Inc.

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EXHIBIT C

NOTE

__________________________                                        ______________
                                                                   [City, State]


                                                                __________, 19__

FOR VALUE RECEIVED, _______________ promises to pay to Sagent Technology, Inc., a California corporation (the "Company"), the principal sum of _______________________ ($_____________), together with interest on the unpaid principal hereof from the date hereof at the rate of _______________ percent (____%) per annum, compounded semiannually.

Principal and interest shall be due and payable on __________, 19___. Payment of principal and interest shall be made in lawful money of the United States of America.

The undersigned may at any time prepay all or any portion of the principal or interest owing hereunder.

This Note is subject to the terms of the Option, dated as of ________________. This Note is secured in part by a pledge of the Company's Common Stock under the terms of a Security Agreement of even date herewith and is subject to all the provisions thereof.

The holder of this Note shall have full recourse against the undersigned, and shall not be required to proceed against the collateral securing this Note in the event of default.

In the event the undersigned shall cease to be an employee, director or consultant of the Company for any reason, this Note shall, at the option of the Company, be accelerated, and the whole unpaid balance on this Note of principal and accrued interest shall be immediately due and payable.

Should any action be instituted for the collection of this Note, the reasonable costs and attorneys' fees therein of the holder shall be paid by the undersigned.




EXHIBIT 10.3

SAGENT TECHNOLOGY, INC.

1998 STOCK PLAN

1. Purposes of the Plan. The purposes of this 1998 Stock Plan are:

- to attract and retain the best available personnel for positions of substantial responsibility,

- to provide additional incentive to Employees, Directors and Consultants, and

- to promote the success of the Company's business.

Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as determined by the Administrator at the time of grant. Stock Purchase Rights may also be granted under the Plan.

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

(a) "Administrator" means the Board or any of its Committees as shall be administering the Plan, in accordance with Section 4 of the Plan.

(b) "Applicable Laws" means the requirements relating to the administration of stock option plans under U. S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any foreign country or jurisdiction where Options or Stock Purchase Rights are, or will be, granted under the Plan.

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

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

(e) "Committee" means a committee of Directors appointed by the Board in accordance with Section 4 of the Plan.

(f) "Common Stock" means the common stock of the Company.

(g) "Company" means Sagent Technology, Inc., a Delaware corporation.

(h) "Consultant" means any person, including an advisor, engaged by the Company or a Parent or Subsidiary to render services to such entity.

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


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

(k) "Employee" means any person, including Officers and Directors, employed by the Company or any Parent or Subsidiary of the Company. A Service Provider shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. For purposes of Incentive Stock Options, no such leave may exceed ninety days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, on the 181st day of such leave any Incentive Stock Option held by the Optionee shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option. Neither service as a Director nor payment of a director's fee by the Company shall be sufficient to constitute "employment" by the Company.

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

(m) "Fair Market Value" means, as of any date, the value of Common Stock determined as follows:

(i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day prior to the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or

(iii) In the absence of an established market for the Common Stock, the Fair Market Value shall be determined in good faith by the Administrator.

(n) "Incentive Stock Option" means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.

(o) "Nonstatutory Stock Option" means an Option not intended to qualify as an Incentive Stock Option.

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(p) "Notice of Grant" means a written or electronic notice evidencing certain terms and conditions of an individual Option or Stock Purchase Right grant. The Notice of Grant is part of the Option Agreement.

(q) "Officer" means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(r) "Option" means a stock option granted pursuant to the Plan.

(s) "Option Agreement" means an agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan.

(t) "Option Exchange Program" means a program whereby outstanding Options are surrendered in exchange for Options with a lower exercise price.

(u) "Optioned Stock" means the Common Stock subject to an Option or Stock Purchase Right.

(v) "Optionee" means the holder of an outstanding Option or Stock Purchase Right granted under the Plan.

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

(x) "Plan" means this 1998 Stock Plan.

(y) "Restricted Stock" means shares of Common Stock acquired pursuant to a grant of Stock Purchase Rights under Section 11 of the Plan.

(z) "Restricted Stock Purchase Agreement" means a written agreement between the Company and the Optionee evidencing the terms and restrictions applying to stock purchased under a Stock Purchase Right. The Restricted Stock Purchase Agreement is subject to the terms and conditions of the Plan and the Notice of Grant.

(aa) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in effect when discretion is being exercised with respect to the Plan.

(bb) "Section 16(b)" means Section 16(b) of the Exchange Act.

(cc) "Service Provider" means an Employee, Director or Consultant.

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(dd) "Share" means a share of the Common Stock, as adjusted in accordance with Section 13 of the Plan.

(ee) "Stock Purchase Right" means the right to purchase Common Stock pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant.

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

3. Stock Subject to the Plan. Subject to the provisions of Section 13 of the Plan, the maximum aggregate number of Shares which may be optioned and sold under the Plan is 2,440,000 Shares, plus an annual increase to be added on May 1 of each year (beginning in 2000) equal to the lesser of (i) 1,500,000 Shares,
(ii) 5% of the outstanding Shares on such date or (iii) such lesser number of Shares as approved by the Board of Directors. The Shares may be authorized, but unissued, or reacquired Common Stock.

If an Option or Stock Purchase Right expires or becomes unexercisable without having been exercised in full, or is surrendered pursuant to an Option Exchange Program, the unpurchased Shares which were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has terminated); provided, however, that Shares that have actually been issued under the Plan, whether upon exercise of an Option or Right, shall not be returned to the Plan and shall not become available for future distribution under the Plan, except that if Shares of Restricted Stock are repurchased by the Company at their original purchase price, such Shares shall become available for future grant under the Plan.

4. Administration of the Plan.

(a) Procedure.

(i) Multiple Administrative Bodies. The Plan may be administered by different Committees with respect to different groups of Service Providers.

(ii) Section 162(m). To the extent that the Administrator determines it to be desirable to qualify Options granted hereunder as "performance-based compensation" within the meaning of Section 162(m) of the Code, the Plan shall be administered by a Committee of two or more "outside directors" within the meaning of Section 162(m) of the Code.

(iii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder shall be structured to satisfy the requirements for exemption under Rule 16b-3.

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(iv) Other Administration. Other than as provided above, the Plan shall be administered by (A) the Board or (B) a Committee, which committee shall be constituted to satisfy Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by the Board to such Committee, the Administrator shall have the authority, in its discretion:

(i) to determine the Fair Market Value;

(ii) to select the Service Providers to whom Options and Stock Purchase Rights may be granted hereunder;

(iii) to determine the number of shares of Common Stock

to be covered by each Option and Stock Purchase Right granted hereunder;

(iv) to approve forms of agreement for use under the Plan;

(v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Option or Stock Purchase Right granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any Option or Stock Purchase Right or the shares of Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine;

(vi) to reduce the exercise price of any Option or Stock Purchase Right to the then current Fair Market Value if the Fair Market Value of the Common Stock covered by such Option or Stock Purchase Right shall have declined since the date the Option or Stock Purchase Right was granted;

(vii) to institute an Option Exchange Program;

(viii) to construe and interpret the terms of the Plan and awards granted pursuant to the Plan;

(ix) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws;

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(x) to modify or amend each Option or Stock Purchase Right (subject to Section 15(c) of the Plan), including the discretionary authority to extend the post-termination exercisability period of Options longer than is otherwise provided for in the Plan;

(xi) to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to be issued upon exercise of an Option or Stock Purchase Right that number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by an Optionee to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable;

(xii) to authorize any person to execute on behalf of the Company any instrument required to effect the grant of an Option or Stock Purchase Right previously granted by the Administrator;

(xiii) to make all other determinations deemed necessary or advisable for administering the Plan.

(c) Effect of Administrator's Decision. The Administrator's decisions, determinations and interpretations shall be final and binding on all Optionees and any other holders of Options or Stock Purchase Rights.

5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may be granted to Service Providers. Incentive Stock Options may be granted only to Employees.

6. Limitations.

(a) Each Option shall be designated in the Option Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Optionee during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be determined as of the time the Option with respect to such Shares is granted.

(b) Neither the Plan nor any Option or Stock Purchase Right shall confer upon an Optionee any right with respect to continuing the Optionee's relationship as a Service Provider with the Company, nor shall they interfere in any way with the Optionee's right or the Company's right to terminate such relationship at any time, with or without cause.

(c) The following limitations shall apply to grants of Options:

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(i) No Service Provider shall be granted, in any fiscal year of the Company, Options to purchase more than 2,000,000 Shares.

(ii) In connection with his or her initial service, a Service Provider may be granted Options to purchase up to an additional 2,000,000 Shares which shall not count against the limit set forth in subsection
(i) above.

(iii) The foregoing limitations shall be adjusted proportionately in connection with any change in the Company's capitalization as described in Section 13.

(iv) If an Option is cancelled in the same fiscal year of the Company in which it was granted (other than in connection with a transaction described in Section 13), the cancelled Option will be counted against the limits set forth in subsections (i) and (ii) above. For this purpose, if the exercise price of an Option is reduced, the transaction will be treated as a cancellation of the Option and the grant of a new Option.

7. Term of Plan. Subject to Section 19 of the Plan, the Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten (10) years unless terminated earlier under Section 15 of the Plan.

8. Term of Option. The term of each Option shall be stated in the Option Agreement. In the case of an Incentive Stock Option, the term shall be ten (10) years from the date of grant or such shorter term as may be provided in the Option Agreement. Moreover, in the case of an Incentive Stock Option granted to an Optionee who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option shall be five (5) years from the date of grant or such shorter term as may be provided in the Option Agreement.

9. Option Exercise Price and Consideration.

(a) Exercise Price. The per share exercise price for the Shares to be issued pursuant to exercise of an Option shall be determined by the Administrator, subject to the following:

(i) In the case of an Incentive Stock Option

(A) granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.

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(B) granted to any Employee other than an Employee described in paragraph (A) immediately above, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant.

(ii) In the case of a Nonstatutory Stock Option, the per Share exercise price shall be determined by the Administrator. In the case of a Nonstatutory Stock Option intended to qualify as "performance-based compensation" within the meaning of Section 162(m) of the Code, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share on the date of grant.

(iii) Notwithstanding the foregoing, Options may be granted with a per Share exercise price of less than 100% of the Fair Market Value per Share on the date of grant pursuant to a merger or other corporate transaction.

(b) Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator shall fix the period within which the Option may be exercised and shall determine any conditions which must be satisfied before the Option may be exercised.

(c) Form of Consideration. The Administrator shall determine the acceptable form of consideration for exercising an Option, including the method of payment. In the case of an Incentive Stock Option, the Administrator shall determine the acceptable form of consideration at the time of grant. Such consideration may consist entirely of:

(i) cash;

(ii) check;

(iii) promissory note;

(iv) other Shares which (A) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six months on the date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised;

(v) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan;

(vi) a reduction in the amount of any Company liability to the Optionee, including any liability attributable to the Optionee's participation in any Company-sponsored deferred compensation program or arrangement;

(vii) any combination of the foregoing methods of payment; or

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(viii) such other consideration and method of payment for the issuance of Shares to the extent permitted by Applicable Laws.

10. Exercise of Option.

(a) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement. Unless the Administrator provides otherwise, vesting of Options granted hereunder shall be tolled during any unpaid leave of absence. An Option may not be exercised for a fraction of a Share.

An Option shall be deemed exercised when the Company receives: (i) written or electronic notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 13 of the Plan.

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

(b) Termination of Relationship as a Service Provider. If an Optionee ceases to be a Service Provider, other than upon the Optionee's death or Disability, the Optionee may exercise his or her Option within such period of time as is specified in the Option Agreement to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for three (3) months following the Optionee's termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified by the Administrator, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

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(c) Disability of Optionee. If an Optionee ceases to be a Service Provider as a result of the Optionee's Disability, the Optionee may exercise his or her Option within such period of time as is specified in the Option Agreement to the extent the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12) months following the Optionee's termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may be exercised within such period of time as is specified in the Option Agreement (but in no event later than the expiration of the term of such Option as set forth in the Notice of Grant), by the Optionee's estate or by a person who acquires the right to exercise the Option by bequest or inheritance, but only to the extent that the Option is vested on the date of death. In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12) months following the Optionee's termination. If, at the time of death, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall immediately revert to the Plan. The Option may be exercised by the executor or administrator of the Optionee's estate or, if none, by the person(s) entitled to exercise the Option under the Optionee's will or the laws of descent or distribution. If the Option is not so exercised within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(e) Buyout Provisions. The Administrator may at any time offer to buy out for a payment in cash or Shares an Option previously granted based on such terms and conditions as the Administrator shall establish and communicate to the Optionee at the time that such offer is made.

11. Stock Purchase Rights.

(a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition to, or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it shall advise the offeree in writing or electronically, by means of a Notice of Grant, of the terms, conditions and restrictions related to the offer, including the number of Shares that the offeree shall be entitled to purchase, the price to be paid, and the time within which the offeree must accept such offer. The offer shall be accepted by execution of a Restricted Stock Purchase Agreement in the form determined by the Administrator.

(b) Repurchase Option. Unless the Administrator determines otherwise, the Restricted Stock Purchase Agreement shall grant the Company a repurchase option exercisable upon the voluntary or involuntary termination of the purchaser's service with the Company for any reason

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(including death or Disability). The purchase price for Shares repurchased pursuant to the Restricted Stock Purchase Agreement shall be the original price paid by the purchaser and may be paid by cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall lapse at a rate determined by the Administrator.

(c) Other Provisions. The Restricted Stock Purchase Agreement shall contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Administrator in its sole discretion.

(d) Rights as a Stockholder. Once the Stock Purchase Right is exercised, the purchaser shall have the rights equivalent to those of a stockholder, and shall be a stockholder when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Stock Purchase Right is exercised, except as provided in Section 13 of the Plan.

12. Non-Transferability of Options and Stock Purchase Rights. Unless determined otherwise by the Administrator, an Option or Stock Purchase Right may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee. If the Administrator makes an Option or Stock Purchase Right transferable, such Option or Stock Purchase Right shall contain such additional terms and conditions as the Administrator deems appropriate.

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

(a) Changes in Capitalization. Subject to any required action by the stockholders of the Company, the number of shares of Common Stock covered by each outstanding Option and Stock Purchase Right, and the number of shares of Common Stock which have been authorized for issuance under the Plan but as to which no Options or Stock Purchase Rights have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option or Stock Purchase Right, as well as the price per share of Common Stock covered by each such outstanding Option or Stock Purchase Right, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration." Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an Option or Stock Purchase Right.

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(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such proposed transaction. The Administrator in its discretion may provide for an Optionee to have the right to exercise his or her Option until ten (10) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option would not otherwise be exercisable. In addition, the Administrator may provide that any Company repurchase option applicable to any Shares purchased upon exercise of an Option or Stock Purchase Right shall lapse as to all such Shares, provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not been previously exercised, an Option or Stock Purchase Right will terminate immediately prior to the consummation of such proposed action.

(c) Merger or Asset Sale. In the event of a merger of the Company with or into another corporation, or the sale of substantially all of the assets of the Company, each outstanding Option and Stock Purchase Right shall be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that the successor corporation refuses to assume or substitute for the Option or Stock Purchase Right, the Optionee shall fully vest in and have the right to exercise the Option or Stock Purchase Right as to all of the Optioned Stock, including Shares as to which it would not otherwise be vested or exercisable. If an Option or Stock Purchase Right becomes fully vested and exercisable in lieu of assumption or substitution in the event of a merger or sale of assets, the Administrator shall notify the Optionee in writing or electronically that the Option or Stock Purchase Right shall be fully vested and exercisable for a period of fifteen (15) days from the date of such notice, and the Option or Stock Purchase Right shall terminate upon the expiration of such period. For the purposes of this paragraph, the Option or Stock Purchase Right shall be considered assumed if, following the merger or sale of assets, the option or right confers the right to purchase or receive, for each Share of Optioned Stock subject to the Option or Stock Purchase Right immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or other securities or property) received in the merger or sale of assets by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the merger or sale of assets is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock subject to the Option or Stock Purchase Right, to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders of Common Stock in the merger or sale of assets.

14. Date of Grant. The date of grant of an Option or Stock Purchase Right shall be, for all purposes, the date on which the Administrator makes the determination granting such Option or Stock Purchase Right, or such other later date as is determined by the Administrator. Notice of the

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determination shall be provided to each Optionee within a reasonable time after the date of such grant.

15. Amendment and Termination of the Plan.

(a) Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan.

(b) Stockholder Approval. The Company shall obtain stockholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws.

(c) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not affect the Administrator's ability to exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to the date of such termination.

16. Conditions Upon Issuance of Shares.

(a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option or Stock Purchase Right unless the exercise of such Option or Stock Purchase Right and the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance.

(b) Investment Representations. As a condition to the exercise of an Option or Stock Purchase Right, the Company may require the person exercising such Option or Stock Purchase Right to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required.

17. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

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

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19. Stockholder Approval. The Plan shall be subject to approval by the stockholders of the Company within twelve (12) months after the date the Plan is adopted. Such stockholder approval shall be obtained in the manner and to the degree required under Applicable Laws.

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SAGENT TECHNOLOGY, INC.

1998 STOCK PLAN

STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the 1998 Stock Plan shall have the same defined meanings in this Stock Option Agreement.

I. NOTICE OF STOCK OPTION GRANT

[Optionee's Name and Address]

You have been granted an option to purchase Common Stock of the Company, subject to the terms and conditions of the Plan and this Option Agreement, as follows:

Grant Number                              _________________________

Date of Grant                             _________________________

Vesting Commencement Date                 _________________________

Exercise Price per Share                  $________________________

Total Number of Shares Granted            _________________________

Total Exercise Price                      $________________________

Type of Option:                           ___  Incentive Stock Option

                                          ___  Nonstatutory Stock Option

Term/Expiration Date:                     _________________________

Vesting Schedule:

This Option may be exercised, in whole or in part, in accordance with the following schedule:

[25% of the Shares subject to the Option shall vest twelve months after the Vesting Commencement Date, and 1/48 of the Shares subject to the Option shall vest each month thereafter, subject to the Optionee continuing to be a Service Provider on such dates].


Termination Period:

This Option may be exercised for ninety (90) days after Optionee ceases to be a Service Provider. Upon the death, Disability or retirement of the Optionee, this Option may be exercised for one year after Optionee ceases to be a Service Provider. In no event shall this Option be exercised later than the Term/Expiration Date as provided above.

II. AGREEMENT

1. Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant attached as Part I of this Agreement (the "Optionee") an option (the "Option") to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise price per share set forth in the Notice of Grant (the "Exercise Price"), subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to
Section 15(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Option Agreement, the terms and conditions of the Plan shall prevail.

If designated in the Notice of Grant as an Incentive Stock Option ("ISO"), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive Stock Option, to the extent that it exceeds the $100,000 rule of Code Section 422(d) it shall be treated as a Nonstatutory Stock Option ("NSO").

2. Exercise of Option.

(1) Right to Exercise. This Option is exercisable during its term in accordance with the Vesting Schedule set out in the Notice of Grant and the applicable provisions of the Plan and this Option Agreement.

(2) Method of Exercise. This Option is exercisable by delivery of an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"), which shall state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the "Exercised Shares"), and such other representations and agreements as may be required by the Company pursuant to the provisions of the Plan. The Exercise Notice shall be completed by the Optionee and delivered to the Company. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate Exercise Price.

No Shares shall be issued pursuant to the exercise of this Option unless such issuance and exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Exercised Shares shall be considered transferred to the Optionee on the date the Option is exercised with respect to such Exercised Shares.

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3. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the following, or a combination thereof, at the election of the Optionee:

(1) cash;

(2) check;

(3) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan; or

(4) surrender of other Shares which (i) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six (6) months on the date of surrender, AND (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares.

4. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent or distribution and may be exercised during the lifetime of Optionee only by the Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee.

5. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option Agreement.

6. Tax Consequences. Some of the federal tax consequences relating to this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

(1) Exercising the Option.

(a) NSO. The Optionee may incur regular federal income tax liability upon exercise of a NSO. The Optionee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price. If the Optionee is an Employee or a former Employee, the Company will be required to withhold from his or her compensation or collect from Optionee and pay to the applicable taxing authorities an amount in cash equal to a percentage of this compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise.

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(b) ISO. If this Option qualifies as an ISO, the Optionee will have no regular federal income tax liability upon its exercise, although the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price will be treated as an adjustment to alternative minimum taxable income for federal tax purposes and may subject the Optionee to alternative minimum tax in the year of exercise. In the event that the Optionee ceases to be an Employee but remains a Service Provider, any Incentive Stock Option of the Optionee that remains unexercised shall cease to qualify as an Incentive Stock Option and will be treated for tax purposes as a Nonstatutory Stock Option on the date three (3) months and one (1) day following such change of status.

(2) Disposition of Shares.

(a) NSO. If the Optionee holds NSO Shares for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes.

(b) ISO. If the Optionee holds ISO Shares for at least one year after exercise and two years after the grant date, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. If the Optionee disposes of ISO Shares within one year after exercise or two years after the grant date, any gain realized on such disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the excess, if any, of the lesser of (A) the difference between the Fair Market Value of the Shares acquired on the date of exercise and the aggregate Exercise Price, or (B) the difference between the sale price of such Shares and the aggregate Exercise Price. Any additional gain will be taxed as capital gain, short-term or long-term depending on the period that the ISO Shares were held.

(3) Notice of Disqualifying Disposition of ISO Shares. If the Optionee sells or otherwise disposes of any of the Shares acquired pursuant to an ISO on or before the later of (i) two years after the grant date, or (ii) one year after the exercise date, the Optionee shall immediately notify the Company in writing of such disposition. The Optionee agrees that he or she may be subject to income tax withholding by the Company on the compensation income recognized from such early disposition of ISO Shares by payment in cash or out of the current earnings paid to the Optionee.

7. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee's interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws, but not the choice of law rules, of California.

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8. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

By your signature and the signature of the Company's representative below, you and the Company agree that this Option is granted under and governed by the terms and conditions of the Plan and this Option Agreement. Optionee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option Agreement and fully understands all provisions of the Plan and Option Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Option Agreement. Optionee further agrees to notify the Company upon any change in the residence address indicated below.

OPTIONEE:                                    SAGENT TECHNOLOGY, INC.



___________________________________          ___________________________________
Signature                                    By

___________________________________          ___________________________________
Print Name                                   Title

___________________________________
Residence Address

___________________________________

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EXHIBIT A

1998 STOCK PLAN

EXERCISE NOTICE

Sagent Technology, Inc.

Attention: [Secretary]

1. Exercise of Option. Effective as of today, ________________, 199__, the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of Sagent Technology, Inc. (the "Company") under and pursuant to the 1998 Stock Plan (the "Plan") and the Stock Option Agreement dated , 19___ (the "Option Agreement"). The purchase price for the Shares shall be $ , as required by the Option Agreement.

2. Delivery of Payment. Purchaser herewith delivers to the Company the full purchase price for the Shares.

3. Representations of Purchaser. Purchaser acknowledges that Purchaser has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions.

4. Rights as Stockholder. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the Shares, no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares so acquired shall be issued to the Optionee as soon as practicable after exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date of issuance, except as provided in Section 13 of the Plan.

5. Tax Consultation. Purchaser understands that Purchaser may suffer adverse tax consequences as a result of Purchaser's purchase or disposition of the Shares. Purchaser represents that Purchaser has consulted with any tax consultants Purchaser deems advisable in connection with the purchase or disposition of the Shares and that Purchaser is not relying on the Company for any tax advice.


6. Entire Agreement; Governing Law. The Plan and Option Agreement are incorporated herein by reference. This Agreement, the Plan and the Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Purchaser with respect to the subject matter hereof, and may not be modified adversely to the Purchaser's interest except by means of a writing signed by the Company and Purchaser. This agreement is governed by the internal substantive laws, but not the choice of law rules, of California.

Submitted by:                                Accepted by:

PURCHASER:                                   SAGENT TECHNOLOGY, INC.


___________________________________          ___________________________________
Signature                                    By

___________________________________          ___________________________________
Print Name                                   Its


Address:                                     Address:


___________________________________



Date Received

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EXHIBIT 10.4

SAGENT TECHNOLOGY, INC.

1999 EMPLOYEE STOCK PURCHASE PLAN

1. Purpose. The purpose of the Plan is to provide employees of the Company and its Designated Subsidiaries with an opportunity to purchase Common Stock of the Company through accumulated payroll deductions. It is the intention of the Company to have the Plan qualify as an "Employee Stock Purchase Plan" under Section 423 of the Internal Revenue Code of 1986, as amended. The provisions of the Plan, accordingly, shall be construed so as to extend and limit participation in a manner consistent with the requirements of that section of the Code.

2. Definitions.

(a) "Board" shall mean the Board of Directors of the Company.

(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.

(c) "Common Stock" shall mean the Common Stock of the Company.

(d) "Company" shall mean Sagent Technology, Inc., a Delaware corporation, and any Designated Subsidiary of the Company.

(e) "Compensation" shall mean all base straight time gross earnings and commissions, exclusive of payments for overtime, shift premium, incentive compensation, incentive payments, bonuses and other compensation.

(f) "Designated Subsidiary" shall mean any Subsidiary which has been designated by the Board from time to time in its sole discretion as eligible to participate in the Plan.

(g) "Employee" shall mean any individual who is an Employee of the Company for tax purposes whose customary employment with the Company is at least 20 hours per week and more than five months in any calendar year. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company. Where the period of leave exceeds 90 days and the individual's right to reemployment is not guaranteed either by statute or by contract, the employment relationship shall be deemed to have terminated on the 91st day of such leave.

(h) "Enrollment Date" shall mean the first day of each Offering Period.

(i) "Exercise Date" shall mean the last day of each Offering Period.

(j) "Fair Market Value" shall mean, as of any date, the value of Common Stock determined as follows:

(1) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq


SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day on the date of such determination, as reported in The Wall Street Journal or such other source as the Board deems reliable, or;

(2) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean of the closing bid and asked prices for the Common Stock on the date of such determination, as reported in The Wall Street Journal or such other source as the Board deems reliable, or;

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

(k) "Offering Period" shall mean a period of approximately six months during which an option granted pursuant to the Plan may be exercised, commencing on the first Trading Day on or after May 1 and terminating on the last Trading Day in the period ending the following October 31, or commencing on the first Trading Day on or after November 1 and terminating on the last Trading Day in the period ending the following April 30; provided, however, that the first Offering Period under the Plan shall commence with the first Trading Day on or after the date on which the Securities and Exchange Commission declares the Company's Registration Statement effective and ending on the last Trading Day on or before October 31, 1999. The duration of Offering Periods may be changed pursuant to Section 4 of this Plan.

(l) "Plan" shall mean this Employee Stock Purchase Plan.

(m) "Purchase Price" shall mean an amount equal to 85% of the Fair Market Value of a share of Common Stock on the Enrollment Date or on the Exercise Date, whichever is lower.

(n) "Reserves" shall mean the number of shares of Common Stock covered by each option under the Plan which have not yet been exercised and the number of shares of Common Stock which have been authorized for issuance under the Plan but not yet placed under option.

(o) "Subsidiary" shall mean a corporation, domestic or foreign, of which not less than 50% of the voting shares are held by the Company or a Subsidiary, whether or not such corporation now exists or is hereafter organized or acquired by the Company or a Subsidiary.

(p) "Trading Day" shall mean a day on which national stock exchanges and the Nasdaq System are open for trading.

3. Eligibility.

(a) Any Employee who shall be employed by the Company on a given Enrollment Date shall be eligible to participate in the Plan.

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(b) Any provisions of the Plan to the contrary notwithstanding, no Employee shall be granted an option under the Plan (i) to the extent that, immediately after the grant, such Employee (or any other person whose stock would be attributed to such Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company and/or hold outstanding options to purchase such stock possessing 5% or more of the total combined voting power or value of all classes of the capital stock of the Company or of any Subsidiary, or (ii) to the extent that his or her rights to purchase stock under all employee stock purchase plans of the Company and its subsidiaries accrues at a rate which exceeds $25,000 worth of stock (determined at the fair market value of the shares at the time such option is granted) for each calendar year in which such option is outstanding at any time.

4. Offering Periods. The Plan shall be implemented by consecutive Offering Periods with a new Offering Period commencing on the first Trading Day on or after May 1 and November 1 each year, or on such other date as the Board shall determine, and continuing thereafter until terminated in accordance with
Section 20 hereof; provided, however, that the first Offering Period under the Plan shall commence with the first Trading Day on or after the date on which the Securities and Exchange Commission declares the Company's Registration Statement effective and ending on the last Trading Day on or before October 31, 1999. The Board shall have the power to change the duration of Offering Periods (including the commencement dates thereof) with respect to future offerings without stockholder approval if such change is announced at least five days prior to the scheduled beginning of the first Offering Period to be affected thereafter.

5. Participation.

(a) An eligible Employee may become a participant in the Plan by completing a subscription agreement authorizing payroll deductions in the form of Exhibit A to this Plan and filing it with the Company's payroll office prior to the applicable Enrollment Date.

(b) Payroll deductions for a participant shall commence on the first payroll following the Enrollment Date and shall end on the last payroll in the Offering Period to which such authorization is applicable, unless sooner terminated by the participant as provided in Section 10 hereof.

6. Payroll Deductions.

(a) At the time a participant files his or her subscription agreement, he or she shall elect to have payroll deductions made on each pay day during the Offering Period in an amount not exceeding twenty percent (20%) of the Compensation which he or she receives on each pay day during the Offering Period.

(b) All payroll deductions made for a participant shall be credited to his or her account under the Plan and shall be withheld in whole percentages only. A participant may not make any additional payments into such account.

(c) A participant may discontinue his or her participation in the Plan as provided in Section 10 hereof, or may increase or decrease the rate of his or her payroll deductions during the

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Offering Period by completing or filing with the Company a new subscription agreement authorizing a change in payroll deduction rate. The Board may, in its discretion, limit the number of participation rate changes during any Offering Period. The change in rate shall be effective with the first full payroll period following five business days after the Company's receipt of the new subscription agreement unless the Company elects to process a given change in participation more quickly. A participant's subscription agreement shall remain in effect for successive Offering Periods unless terminated as provided in Section 10 hereof.

(d) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code and Section 3(b) hereof, a participant's payroll deductions may be decreased to 0% at any time during an Offering Period. Payroll deductions shall recommence at the rate provided in such participant's subscription agreement at the beginning of the first Offering Period which is scheduled to end in the following calendar year, unless terminated by the participant as provided in Section 10 hereof.

(e) At the time the option is exercised, in whole or in part, or at the time some or all of the Company's Common Stock issued under the Plan is disposed of, the participant must make adequate provision for the Company's federal, state, or other tax withholding obligations, if any, which arise upon the exercise of the option or the disposition of the Common Stock. At any time, the Company may, but shall not be obligated to, withhold from the participant's compensation the amount necessary for the Company to meet applicable withholding obligations, including any withholding required to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by the Employee.

7. Grant of Option. On the Enrollment Date of each Offering Period, each eligible Employee participating in such Offering Period shall be granted an option to purchase on the Exercise Date of such Offering Period (at the applicable Purchase Price) up to a number of shares of the Company's Common Stock determined by dividing such Employee's payroll deductions accumulated prior to such Exercise Date and retained in the Participant's account as of the Exercise Date by the applicable Purchase Price; provided, that in no event shall an Employee be permitted to purchase during each Offering Period more than 10,000 shares (subject to any adjustment pursuant to Section 19), and provided further, that such purchase shall be subject to the limitations set forth in Sections 3(b) and 12 hereof. Exercise of the option shall occur as provided in
Section 8 hereof, unless the participant has withdrawn pursuant to Section 10 hereof. The Option shall expire on the last day of the Offering Period.

8. Exercise of Option. Unless a participant withdraws from the Plan as provided in Section 10 hereof, his or her option for the purchase of shares shall be exercised automatically on the Exercise Date, and the maximum number of full shares subject to option shall be purchased for such participant at the applicable Purchase Price with the accumulated payroll deductions in his or her account. No fractional shares shall be purchased; any payroll deductions accumulated in a participant's account which are not sufficient to purchase a full share shall be retained in the participant's account for the subsequent Offering Period, subject to earlier withdrawal by the participant as provided in
Section 10 hereof. Any other monies left over in a participant's account after the Exercise Date shall be returned

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to the participant. During a participant's lifetime, a participant's option to purchase shares hereunder is exercisable only by him or her.

9. Delivery. As promptly as practicable after each Exercise Date on which a purchase of shares occurs, the Company shall arrange the delivery to each participant, as appropriate, of a certificate representing the shares purchased upon exercise of his or her option.

10. Withdrawal.

(a) A participant may withdraw all but not less than all the payroll deductions credited to his or her account and not yet used to exercise his or her option under the Plan at any time by giving written notice to the Company in the form of Exhibit B to this Plan. All of the participant's payroll deductions credited to his or her account shall be paid to such participant promptly after receipt of notice of withdrawal and such participant's option for the Offering Period shall be automatically terminated, and no further payroll deductions for the purchase of shares shall be made for such Offering Period. If a participant withdraws from an Offering Period, payroll deductions shall not resume at the beginning of the succeeding Offering Period unless the participant delivers to the Company a new subscription agreement.

(b) A participant's withdrawal from an Offering Period shall not have any effect upon his or her eligibility to participate in any similar plan which may hereafter be adopted by the Company or in succeeding Offering Periods which commence after the termination of the Offering Period from which the participant withdraws.

11. Termination of Employment. Upon a participant's ceasing to be an Employee for any reason, he or she shall be deemed to have elected to withdraw from the Plan and the payroll deductions credited to such participant's account during the Offering Period but not yet used to exercise the option shall be returned to such participant or, in the case of his or her death, to the person or persons entitled thereto under Section 15 hereof, and such participant's option shall be automatically terminated. The preceding sentence notwithstanding, a participant who receives payment in lieu of notice of termination of employment shall be treated as continuing to be an Employee for the participant's customary number of hours per week of employment during the period in which the participant is subject to such payment in lieu of notice.

12. Interest. No interest shall accrue on the payroll deductions of a participant in the Plan.

13. Stock.

(a) The maximum number of shares of the Company's Common Stock which shall be made available for sale under the Plan shall be 450,000 shares, plus an annual increase to be added on each anniversary date of the adoption of the Plan equal to (i) the optioned stock underlying options granted in the immediately preceding year, or (ii) a lesser amount determined by the Board, subject to adjustment upon changes in capitalization of the Company as provided in Section 19 hereof. If, on a given Exercise Date, the number of shares with respect to which options are to be exercised exceeds the

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number of shares then available under the Plan, the Company shall make a pro rata allocation of the shares remaining available for purchase in as uniform a manner as shall be practicable and as it shall determine to be equitable.

(b) The participant shall have no interest or voting right in shares covered by his option until such option has been exercised.

(c) Shares to be delivered to a participant under the Plan shall be registered in the name of the participant or in the name of the participant and his or her spouse.

14. Administration. The Plan shall be administered by the Board or a committee of members of the Board appointed by the Board. The Board or its committee shall have full and exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to determine eligibility and to adjudicate all disputed claims filed under the Plan. Every finding, decision and determination made by the Board or its committee shall, to the full extent permitted by law, be final and binding upon all parties.

15. Designation of Beneficiary.

(a) A participant may file a written designation of a beneficiary who is to receive any shares and cash, if any, from the participant's account under the Plan in the event of such participant's death subsequent to an Exercise Date on which the option is exercised but prior to delivery to such participant of such shares and cash. In addition, a participant may file a written designation of a beneficiary who is to receive any cash from the participant's account under the Plan in the event of such participant's death prior to exercise of the option. If a participant is married and the designated beneficiary is not the spouse, spousal consent shall be required for such designation to be effective.

(b) Such designation of beneficiary may be changed by the participant at any time by written notice. In the event of the death of a participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such participant's death, the Company shall deliver such shares and/or cash to the executor or administrator of the estate of the participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more dependents or relatives of the participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate.

16. Transferability. Neither payroll deductions credited to a participant's account nor any rights with regard to the exercise of an option or to receive shares under the Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 15 hereof) by the participant. Any such attempt at assignment, transfer, pledge or other disposition shall be without effect, except that the Company may treat such act as an election to withdraw funds from an Offering Period in accordance with Section 10 hereof.

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17. Use of Funds. All payroll deductions received or held by the Company under the Plan may be used by the Company for any corporate purpose, and the Company shall not be obligated to segregate such payroll deductions.

18. Reports. Individual accounts shall be maintained for each participant in the Plan. Statements of account shall be given to participating Employees at least annually, which statements shall set forth the amounts of payroll deductions, the Purchase Price, the number of shares purchased and the remaining cash balance, if any.

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

(a) Changes in Capitalization. Subject to any required action by the stockholders of the Company, the Reserves, the maximum number of shares each participant may purchase per Offering Period (pursuant to Section 7), as well as the price per share and the number of shares of Common Stock covered by each option under the Plan which has not yet been exercised shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration." Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an option.

(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Offering Period then in progress shall be shortened by setting a new Exercise Date (the "New Exercise Date"), and shall terminate immediately prior to the consummation of such proposed dissolution or liquidation, unless provided otherwise by the Board. The New Exercise Date shall be before the date of the Company's proposed dissolution or liquidation. The Board shall notify each participant in writing, at least ten business days prior to the New Exercise Date, that the Exercise Date for the participant's option has been changed to the New Exercise Date and that the participant's option shall be exercised automatically on the New Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as provided in Section 10 hereof.

(c) Merger or Asset Sale. In the event of a proposed sale of all or substantially all of the assets of the Company, or the merger of the Company with or into another corporation, each outstanding option shall be assumed or an equivalent option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that the successor corporation refuses to assume or substitute for the option, the Offering Period then in progress shall be shortened by setting a new Exercise Date (the "New Exercise Date"). The New Exercise Date shall be before the date of the Company's proposed sale or merger. The Board shall notify each participant in writing, at least ten business days prior to the New Exercise Date, that the Exercise Date for the participant's option has been

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changed to the New Exercise Date and that the participant's option shall be exercised automatically on the New Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as provided in Section 10 hereof.

20. Amendment or Termination.

(a) The Board of Directors of the Company may at any time and for any reason terminate or amend the Plan. Except as provided in Section 19 hereof, no such termination can affect options previously granted; provided, that an Offering Period may be terminated by the Board of Directors on any Exercise Date if the Board determines that the termination of the Plan is in the best interests of the Company and its stockholders. Except as provided in Section 19 hereof, no amendment may make any change in any option theretofore granted which adversely affects the rights of any participant. To the extent necessary to comply with Section 423 of the Code (or any other applicable law, regulation or stock exchange rule), the Company shall obtain shareholder approval in such a manner and to such a degree as required.

(b) Without stockholder consent and without regard to whether any participant rights may be considered to have been "adversely affected," the Board (or its committee) shall be entitled to change the Offering Periods, limit the frequency and/or number of changes in the amount withheld during an Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by a participant in order to adjust for delays or mistakes in the Company's processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each participant properly correspond with amounts withheld from the participant's Compensation, and establish such other limitations or procedures as the Board (or its committee) determines in its sole discretion advisable which are consistent with the Plan.

21. Notices. All notices or other communications by a participant to the Company under or in connection with the Plan shall be deemed to have been duly given when received in the form specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.

22. Conditions Upon Issuance of Shares. Shares shall not be issued with respect to an option unless the exercise of such option and the issuance and delivery of such shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance.

As a condition to the exercise of an option, the Company may require the person exercising such option to represent and warrant at the time of any such exercise that the shares are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of

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counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of law.

23. Term of Plan. The Plan shall become effective upon the earlier to occur of its adoption by the Board of Directors or its approval by the stockholders of the Company. It shall continue in effect for a term of ten years unless sooner terminated under Section 20 hereof.

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EXHIBIT A

SAGENT TECHNOLOGY, INC.

1999 EMPLOYEE STOCK PURCHASE PLAN

SUBSCRIPTION AGREEMENT

_____ Original Application                           Enrollment Date: __________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)

1. _____________________________________ hereby elects to participate in the Sagent Technology, Inc. 1999 Employee Stock Purchase Plan (the "Employee Stock Purchase Plan") and subscribes to purchase shares of the Company's Common Stock in accordance with this Subscription Agreement and the Employee Stock Purchase Plan.

2. I hereby authorize payroll deductions from each paycheck in the amount of ____% of my Compensation on each payday (from 1 to 20%) during the Offering Period in accordance with the Employee Stock Purchase Plan.
(Please note that no fractional percentages are permitted.)

3. I understand that said payroll deductions shall be accumulated for the purchase of shares of Common Stock at the applicable Purchase Price determined in accordance with the Employee Stock Purchase Plan. I understand that if I do not withdraw from an Offering Period, any accumulated payroll deductions will be used to automatically exercise my option.

4. I have received a copy of the complete Employee Stock Purchase Plan. I understand that my participation in the Employee Stock Purchase Plan is in all respects subject to the terms of the Plan. I understand that my ability to exercise the option under this Subscription Agreement is subject to stockholder approval of the Employee Stock Purchase Plan.

5. Shares purchased for me under the Employee Stock Purchase Plan should be issued in the name(s) of (Employee or Employee and Spouse only):
________________________.

6. I understand that if I dispose of any shares received by me pursuant to the Plan within two years after the Enrollment Date (the first day of the Offering Period during which I purchased such shares), I will be treated for federal income tax purposes as having received ordinary income at the time of such disposition in an amount equal to the excess of the fair market value of the shares at the time such shares were purchased by me over the price which I paid for the shares. I hereby agree to notify the Company in writing within 30 days after the date of any disposition of shares and I will make adequate provision for Federal, state or other tax withholding obligations, if any, which arise upon the disposition of the Common Stock. The Company may, but not be obligated to, withhold from my compensation the amount necessary to meet any


applicable withholding obligation including any withholding necessary to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by me. If I dispose of such shares at any time after the expiration of the two-year holding period, I understand that I will be treated for federal income tax purposes as having received income only at the time of such disposition, and that such income will be taxed as ordinary income only to the extent of an amount equal to the lesser of (1) the excess of the fair market value of the shares at the time of such disposition over the purchase price which I paid for the shares, or (2) 15% of the fair market value of the shares on the first day of the Offering Period. The remainder of the gain, if any, recognized on such disposition will be taxed as capital gain.

7. I hereby agree to be bound by the terms of the Employee Stock Purchase Plan. The effectiveness of this Subscription Agreement is dependent upon my eligibility to participate in the Employee Stock Purchase Plan.

8. In the event of my death, I hereby designate the following as my beneficiary(ies) to receive all payments and shares due me under the Employee Stock Purchase Plan:

Name: (Please print)

(First) (Middle) (Last)


Relationship

(Address)

Employee's Social
Security Number:

Employee's Address:


I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.

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Dated:
      ------------------   ----------------------------------------------------
                           Signature of Employee


                           ----------------------------------------------------
                           Spouse's Signature (If beneficiary other than spouse)

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EXHIBIT B

SAGENT TECHNOLOGY, INC.

1999 EMPLOYEE STOCK PURCHASE PLAN

NOTICE OF WITHDRAWAL

The undersigned participant in the Offering Period of the Sagent Technology, Inc. 1999 Employee Stock Purchase Plan which began on ___________, 19____ (the "Enrollment Date") hereby notifies the Company that he or she hereby withdraws from the Offering Period. He or she hereby directs the Company to pay to the undersigned as promptly as practicable all the payroll deductions credited to his or her account with respect to such Offering Period. The undersigned understands and agrees that his or her option for such Offering Period will be automatically terminated. The undersigned understands further that no further payroll deductions will be made for the purchase of shares in the current Offering Period and the undersigned shall be eligible to participate in succeeding Offering Periods only by delivering to the Company a new Subscription Agreement.

Name and Address of Participant:




Signature:


Date:



EXHIBIT 10.5
SAGENT TECHNOLOGY, INC.

1999 DIRECTOR OPTION PLAN

1. Purposes of the Plan. The purposes of this Plan are:

o to attract and retain the best available personnel for service as Outside Directors (as defined herein) of the Company,

o to provide additional incentive to Outside Directors.

Options granted under the Plan will be Nonstatutory Stock Options. Stock Purchase Rights may also be granted under the Plan.

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

(a) "Administrator" means the Board or any of its Committees as shall be administering the Plan, in accordance with Section 4 of the Plan.

(b) "Applicable Laws" means the requirements relating to the administration of stock option plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, and the applicable laws of any foreign country or jurisdiction where Options or Stock Purchase Rights are, or will be, granted under the Plan.

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

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

(e) "Committee" means a committee of Directors appointed by the Board in accordance with Section 4 of the Plan.

(f) "Common Stock" means the Common Stock of the Company.

(g) "Company" means Sagent Technology, Inc., a Delaware corporation.

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

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


(j) "Employee" means any person employed by the Company or any Parent or Subsidiary of the Company. Neither service as a Director nor payment of a director's fee by the Company shall be sufficient to constitute "employment" by the Company.

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

(l) "Fair Market Value" means, as of any date, the value of Common Stock determined as follows:

(i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day prior to the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(iii) In the absence of an established market for the Common Stock, the Fair Market Value shall be determined in good faith by the Administrator.

(m) "Notice of Grant" means a written or electronic notice evidencing certain terms and conditions of an individual Option or Stock Purchase Right grant. The Notice of Grant is part of the Option Agreement.

(n) "Option" means a nonstatutory stock option granted pursuant to the Plan, that is not intended to qualify as an incentive stock option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.

(o) "Option Agreement" means an agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan.

(p) "Optioned Stock" means the Common Stock subject to an Option or a Stock Purchase Right.

(q) "Optionee" means the holder of an outstanding Option or Stock Purchase Right granted under the Plan.

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


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

(t) "Plan" means this 1999 Director Option Plan.

(u) "Restricted Stock" means shares of Common Stock acquired pursuant to a grant of a Stock Purchase Right under Section 11 below.

(v) "Share" means a share of the Common Stock, as adjusted in accordance with Section 12 of the Plan.

(w) "Stock Purchase Right" means a right to purchase Common Stock pursuant to Section 11 below.

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

3. Stock Subject to the Plan. Subject to the provisions of Section 12 of the Plan, the maximum aggregate number of Shares which may be optioned and sold under the Plan is 150,000 Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.

If an Option or Stock Purchase Right expires or becomes unexercisable without having been exercised in full, the unpurchased Shares which were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has terminated).

However, Shares that have actually been issued under the Plan, upon exercise of either an Option or Stock Purchase Right, shall not be returned to the Plan and shall not become available for future distribution under the Plan, except that if Shares of Restricted Stock are repurchased by the Company at their original purchase price, such Shares shall become available for future grant under the Plan.

4. Administration of the Plan.

(a) Administration. The Plan shall be administered by (i) the Board or (ii) a Committee, which committee shall be constituted to satisfy Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by the Board to such Committee, the Administrator shall have the authority, in its discretion:

(i) to determine the Fair Market Value of the Common Stock;

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(ii) to select the Outside Directors to whom Options and Stock Purchase Rights may be granted hereunder;

(iii) to determine whether and to what extent Options and Stock Purchase Rights are granted hereunder;

(iv) to determine the number of shares of Common Stock to be covered by each such award granted hereunder;

(v) to approve forms of agreement for use under the Plan;

(vi) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any award granted hereunder. Such terms and conditions include, but are not limited to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any Option or Stock Purchase Right or the shares of Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine;

(vii) to construe and interpret the terms of the Plan and awards granted pursuant to the Plan;

(viii) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws;

(ix) to modify or amend each Option (subject to Section 14(b) of the Plan), including the discretionary authority to extend the post-termination exercisability period of Options longer than is otherwise provided for in the Plan;

(x) to authorize any person to execute on behalf of the Company any instrument required to effect the grant of an Option or Stock Purchase Right previously granted by the Administrator;

(xi) to determine the terms and restrictions applicable to Options or Stock Purchase Rights;

(xii) to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to be issued upon exercise of an Option or Stock Purchase Right that number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by an Optionee to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable; and


(xiii) to make all other determinations deemed necessary or advisable for administering the Plan.

(c) Effect of Administrator's Decision. The Administrator's decisions, determinations and interpretations shall be final and binding on all Optionees and any other holders of Options or Stock Purchase Rights.

5. Eligibility. Options and Stock Purchase Rights may be granted only to Outside Directors.

6. Term of Plan. The Plan shall become effective upon its adoption by the Board. It shall continue until terminated under Section 14 of the Plan.

7. Term of Option. The term of each Option shall be stated in the Option Agreement.

8. Option Exercise Price and Consideration.

(a) Exercise Price. The per share exercise price for the Shares to be issued pursuant to exercise of an Option shall be determined by the Administrator.

(b) Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator shall fix the period within which the Option may be exercised and shall determine any conditions which must be satisfied before the Option may be exercised.

(c) Form of Consideration. The Administrator shall determine the acceptable form of consideration for exercising an Option, including the method of payment. Such consideration may consist entirely of:

(i) cash;

(ii) check;

(iii) promissory note;

(iv) other Shares which (A) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six months on the date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised;

(v) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan;

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(vi) a reduction in the amount of any Company liability to the Optionee, including any liability attributable to the Optionee's participation in any Company-sponsored deferred compensation program or arrangement;

(vii) such other consideration and method of payment for the issuance of Shares to the extent permitted by Applicable Laws; or

(viii) any combination of the foregoing methods of payment.

9. Exercise of Option.

(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement. An Option may not be exercised for a fraction of a Share.

An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 12 of the Plan.

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

(b) Termination of Service with the Company. If an Optionee ceases to provide service to the Company (either as a Director, Employee, or consultant), other than upon the Optionee's death or Disability, the Optionee may exercise his or her Option, but only within such period of time as is specified in the Option Agreement, and only to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for thirty (30) days following the Optionee's termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified by the Option Agreement or herein, as

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applicable, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

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

(d) Death of Optionee. In the event of an Optionee's death, the Optionee's estate or a person who acquired the right to exercise the Option by bequest or inheritance may exercise the Option, but only within six (6) months following the date of death, and only to the extent that the Optionee was entitled to exercise it on the date of death (but in no event later than the expiration of its ten (10) year term). To the extent that the Optionee was not entitled to exercise an Option on the date of death, and to the extent that the Optionee's estate or a person who acquired the right to exercise such Option does not exercise such Option (to the extent otherwise so entitled) within the time specified in the Option Agreement or herein, as applicable, the Option shall terminate.

10. Non-Transferability of Options and Stock Purchase Rights. Unless determined otherwise by the Administrator, an Option may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee. If the Administrator makes an Option transferable, such Option shall contain such additional terms and conditions as the Administrator deems appropriate.

11. Stock Purchase Rights.

(a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition to, or in tandem with other awards granted under the Plan and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it shall advise the offeree in writing or electronically of the terms, conditions and restrictions related to the offer, including the number of Shares that such person shall be entitled to purchase, the price to be paid, and the time within which such person must accept such offer. The offer shall be accepted by execution of a Restricted Stock purchase agreement in the form determined by the Administrator.

(b) Repurchase Option. Unless the Administrator determines otherwise, the Restricted Stock purchase agreement shall grant the Company a repurchase option exercisable upon the voluntary or involuntary termination of the purchaser's service with the Company for any reason (including death or disability). The purchase price for Shares repurchased pursuant to the Restricted Stock purchase agreement shall be the original price paid by the purchaser and may be paid by

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cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall lapse at such rate as the Administrator may determine.

(c) Other Provisions. The Restricted Stock purchase agreement shall contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Administrator in its sole discretion.

(d) Rights as a Shareholder. Once the Stock Purchase Right is exercised, the purchaser shall have rights equivalent to those of a shareholder and shall be a shareholder when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment shall be made for a dividend or other right for which the record date is prior to the date the Stock Purchase Right is exercised, except as provided in Section 12 of the Plan.

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

(a) Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number of shares of Common Stock covered by each outstanding Option or Stock Purchase Right, and the number of shares of Common Stock which have been authorized for issuance under the Plan but as to which no Options or Stock Purchase Rights have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option or Stock Purchase Right, as well as the price per share of Common Stock covered by each such outstanding Option or Stock Purchase Right, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration." Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an Option or Stock Purchase Right.

(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such proposed transaction. The Administrator in its discretion may provide for an Optionee to have the right to exercise his or her Option until fifteen (15) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option would not otherwise be exercisable. In addition, the Administrator may provide that any Company repurchase option applicable to any Shares purchased upon exercise of an Option or Stock Purchase Right shall lapse as to all such Shares, provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not been previously exercised, an Option or Stock Purchase Right will terminate immediately prior to the consummation of such proposed action.

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(c) Merger or Asset Sale. In the event of a merger of the Company with or into another corporation or the sale of substantially all of the assets of the Company, outstanding Options or Stock Purchase Rights may be assumed or equivalent options or rights may be substituted by the successor corporation or a Parent or Subsidiary thereof (the "Successor Corporation"). If an Option or Stock Purchase Right is assumed or substituted for, the Option or Stock Purchase Right or equivalent option or right shall continue to be exercisable as provided in Section 4 hereof for so long as the Optionee serves as a Director or a director of the Successor Corporation. Following such assumption or substitution, if the Optionee's status as a Director or director of the Successor Corporation, as applicable, is terminated other than upon a voluntary resignation by the Optionee, the Option or option shall become fully exercisable, including as to Shares for which it would not otherwise be exercisable. Thereafter, the Option or option shall remain exercisable in accordance with Sections 9(b) through (d) above.

If the Successor Corporation does not assume an outstanding Option or Stock Purchase Right or substitute for it an equivalent option or right, the Option or Stock Purchase Right shall become fully vested and exercisable, including as to Shares for which it would not otherwise be exercisable. In such event the Board shall notify the Optionee that the Option shall be fully exercisable for a period of fifteen (15) days from the date of such notice, and upon the expiration of such period the Option or Stock Purchase Right shall terminate. In addition, any Restricted Stock purchased upon the exercise of a Stock Purchase Right granted under this Plan shall become fully vested and the Company's or the Successor Corporation's repurchase right shall lapse.

For the purposes of this Section 12(c), an Option or Stock Purchase Right shall be considered assumed if, following the merger or sale of assets, the Option or Stock Purchase Right confers the right to purchase or receive, for each Share of Optioned Stock subject to the Option or Stock Purchase Right immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or other securities or property) received in the merger or sale of assets by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares). If such consideration received in the merger or sale of assets is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of the Option or Stock Purchase Right, for each Share of Optioned Stock subject to the Option or Stock Purchase Right, to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders of Common Stock in the merger or sale of assets.

13. Date of Grant. The date of grant of an Option or Stock Purchase Right shall be, for all purposes, the date on which the Administrator makes the determination granting such Option or Stock Purchase Right, or such other later date as is determined by the Administrator. Notice of the determination shall be provided to each Optionee within a reasonable time after the date of such grant.

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14. Amendment and Termination of the Plan.

(a) Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan.

(b) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not affect the Administrator's ability to exercise the powers granted to it hereunder with respect to options granted under the Plan prior to the date of such termination.

(c) Shareholder Approval. The Board shall obtain shareholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws.

15. Conditions Upon Issuance of Shares.

(a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option or Stock Purchase Right unless the exercise of such Option or Stock Purchase Right and the issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance.

(b) Investment Representations. As a condition to the exercise of an Option or Stock Purchase Right the Company may require the person exercising such Option or Stock Purchase Right to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required.

16. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company's counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

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

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SAGENT TECHNOLOGY, INC.

1999 DIRECTOR OPTION PLAN

STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Option Agreement.

I. NOTICE OF STOCK OPTION GRANT

[OPTIONEE'S NAME AND ADDRESS]

You have been granted an option to purchase Common Stock of the Company, subject to the terms and conditions of the Plan and this Option Agreement, as follows:

Grant Number
Date of Grant
Vesting Commencement Date
Exercise Price per Share $ Total Number of Shares Granted Total Exercise Price $

Type of Option: Nonstatutory Stock Option

Term/Expiration Date:
Vesting Schedule:

Subject to the Optionee continuing to be an Outside Director on such dates, this Option shall vest and become exercisable in accordance with the following schedule:

[25% OF THE SHARES SUBJECT TO THE OPTION SHALL VEST EACH YEAR ON THE

ANNIVERSARY OF THE VESTING COMMENCEMENT DATE; PROVIDED, HOWEVER, THAT OPTIONEE BE PROVIDING SERVICES TO THE COMPANY ON SUCH DATES].


Termination Period:

This Option may be exercised for thirty (30) days after Optionee ceases to provide service to the Company. Upon the death or Disability of the Optionee, this Option may be exercised for such longer period as provided in the Plan. In no event shall this Option be exercised later than the Term/Expiration Date as provided above.

II. AGREEMENT

1. Grant of Option. The Plan Administrator of the Company hereby grants to the Optionee named in the Notice of Grant attached as Part I of this Agreement (the "Optionee") an option (the "Option") to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise price per share set forth in the Notice of Grant (the "Exercise Price"), subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to
Section 14(b) of the Plan, in the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Option Agreement, the terms and conditions of the Plan shall prevail.

2. Exercise of Option.

(a) Right to Exercise. This Option is exercisable during its term in accordance with the Vesting Schedule set out in the Notice of Grant and the applicable provisions of the Plan and this Option Agreement.

(b) Method of Exercise. This Option is exercisable by delivery of an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"), which shall state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the "Exercised Shares"), and such other representations and agreements as may be required by the Company pursuant to the provisions of the Plan. The Exercise Notice shall be completed by the Optionee and delivered to [TITLE]. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate Exercise Price.

No Shares shall be issued pursuant to the exercise of this Option unless such issuance and exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Exercised Shares shall be considered transferred to the Optionee on the date the Option is exercised with respect to such Exercised Shares.

3. Optionee's Representations. In the event the Shares have not been registered under the Securities Act of 1933, as amended, at the time this Option is exercised, the Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option, deliver to the Company his or her Investment Representation Statement in the form attached hereto as Exhibit B.


4. Lock-Up Period. Optionee hereby agrees that, if so requested by the Company or any representative of the underwriters (the "Managing Underwriter") in connection with any registration of the offering of any securities of the Company under the Securities Act, Optionee shall not sell or otherwise transfer any Shares or other securities of the Company during the 180-day period (or such other period as may be requested in writing by the Managing Underwriter and agreed to in writing by the Company) (the "Market Standoff Period") following the effective date of a registration statement of the Company filed under the Securities Act. Such restriction shall apply only to the first registration statement of the Company to become effective under the Securities Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of such Market Standoff Period.

5. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the following, or a combination thereof, at the election of the Optionee:

(a) cash;

(b) check;

(c) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan; or

(d) surrender of other Shares which (i) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six (6) months on the date of surrender, AND (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares.

6. Restrictions on Exercise. This Option may not be exercised until such time as the Plan has been approved by the shareholders of the Company, or if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any Applicable Law.

7. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than by will or by the laws of descent or distribution and may be exercised during the lifetime of Optionee only by the Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Optionee.

8. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option Agreement.

9. Tax Consequences. Some of the federal tax consequences relating to this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE,

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AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

(a) Exercising the Option. The Optionee may incur regular federal income tax liability upon exercise of an NSO. The Optionee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price.

(b) Disposition of Shares. If the Optionee holds NSO Shares for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes.

10. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee's interest except by means of a writing signed by the Company and Optionee. This agreement is governed by the internal substantive laws, but not the choice of law rules, of California.

By your signature and the signature of the Company's representative below, you and the Company agree that this Option is granted under and governed by the terms and conditions of the Plan and this Option Agreement. Optionee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option Agreement and fully understands all provisions of the Plan and Option Agreement. Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Option Agreement. Optionee further agrees to notify the Company upon any change in the residence address indicated below.

OPTIONEE                               SAGENT TECHNOLOGY, INC.



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Signature                              By

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Print Name                             Title

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Residence Address

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EXHIBIT A

SAGENT TECHNOLOGY, INC.

1999 DIRECTOR OPTION PLAN

EXERCISE NOTICE

Sagent Technology, Inc.
800 W. El Camino Real
Third Floor
Mountain View, California 94040

Attention: [TITLE]

1 Exercise of Option. Effective as of today, ________________, ______, the undersigned ("Purchaser") hereby elects to purchase ______________ shares
(the "Shares") of the Common Stock of Sagent Technology, Inc. (the "Company")
under and pursuant to the 1999 Director Option Plan (the "Plan") and the Stock Option Agreement dated _________, ______ (the "Option Agreement"). The purchase price for the Shares shall be $ __________, as required by the Option Agreement.

2 Delivery of Payment. Purchaser herewith delivers to the Company the full purchase price for the Shares.

3 Representations of Purchaser. Purchaser acknowledges that Purchaser has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions.

4 Rights as Shareholder. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the Shares, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares so acquired shall be issued to the Optionee as soon as practicable after exercise of the Option. No adjustment will be made for a dividend or other right for which the record date is prior to the date of issuance, except as provided in Section 11 of the Plan.

5 Tax Consultation. Purchaser understands that Purchaser may suffer adverse tax consequences as a result of Purchaser's purchase or disposition of the Shares. Purchaser represents that Purchaser has consulted with any tax consultants Purchaser deems advisable in connection with the purchase or disposition of the Shares and that Purchaser is not relying on the Company for any tax advice.


6. Restrictive Legends and Stop-Transfer Orders.

(a) Legends. Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be required by the Company or by state or federal securities laws:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION OF COMPANY COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES.

(b) Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance with the restrictions referred to herein, the Company may issue appropriate "stop transfer" instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records.

(c) Interpretation. Any dispute regarding the interpretation of this Exercise Notice shall be submitted by Optionee or by the Company forthwith to the Administrator which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator shall be final and binding on all parties.


7. Entire Agreement; Governing Law. The Plan and Option Agreement are incorporated herein by reference. This Agreement, the Plan and the Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Purchaser with respect to the subject matter hereof, and may not be modified adversely to the Purchaser's interest except by means of a writing signed by the Company and Purchaser. This agreement is governed by the internal substantive laws, but not the choice of law rules, of California.

Submitted by:                          Accepted by:

PURCHASER                              SAGENT TECHNOLOGY, INC.


----------------------------------     -------------------------------------
Signature                              By

----------------------------------     -------------------------------------
Print Name                             Title

----------------------------------
Date Received


Address:                               Address: 800 W. El Camino Real
        ---------------------------    -------  Third Floor
                                                Mountain View, California 94040

-3-

EXHIBIT B

INVESTMENT REPRESENTATION STATEMENT

OPTIONEE:

COMPANY:     SAGENT TECHNOLOGY, INC.

SECURITY:    COMMON STOCK

AMOUNT:

DATE:


         In connection with the purchase of the above-listed Securities, the

undersigned Optionee represents to the Company the following:

(a) Optionee is aware of the Company's business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee's own account only and not with a view to, or for resale in connection with, any "distribution" thereof within the meaning of the Securities Act of 1933, as amended (the "Securities Act").

(b) Optionee acknowledges and understands that the Securities constitute "restricted securities" under the Securities Act and have not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee's investment intent as expressed herein. In this connection, Optionee understands that, in the view of the Securities and Exchange Commission, the statutory basis for such exemption may be unavailable if Optionee's representation was predicated solely upon a present intention to hold these Securities for the minimum capital gains period specified under tax statutes, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further understands that the Securities must be held indefinitely unless they are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under no obligation to register the Securities. Optionee understands that the certificate evidencing the Securities will be imprinted with a legend which prohibits the transfer of the Securities unless they are registered or such registration is not required in the opinion of counsel satisfactory to the Company, and any other legend required under applicable state securities laws.

(c) Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in substance, permit limited public resale of "restricted securities" acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies under Rule 701 at the


time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the reporting requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited "broker's transaction" or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of Securities being sold during any three month period not exceeding the limitations specified in Rule 144(e), and (4) the timely filing of a Form 144, if applicable.

In the event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold in certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than one year after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the paragraph immediately above.

(d) Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any such other registration exemption will be available in such event.

Signature of Optionee:


Date: , 19



EXHIBIT 10.6
MASTER EQUIPMENT LEASE AGREEMENT
Agreement No. 113 Dated: August 7, 1995

LESSOR:   LIGHTHOUSE CAPITAL PARTNERS, L.P., a Delaware limited partnership
          ("Lessor"), 100 Drakes Landing Road, Suite 260, Greenbrae,
          California 94904

LESSEE:   SAGENT TECHNOLOGY, INC., a California corporation ("Lessee"),

ADDRESS:  750 Menlo Avenue, Suite 300, Menlo Park, California 94025.


        IN CONSIDERATION of the mutual covenants contained herein, the parties

agree as follows:

1. LEASE. Lessor leases to Lessee and Lessee leases from Lessor the personal property described in each Equipment Schedule executed pursuant hereto, subject to the terms and conditions of this Master Equipment Lease Agreement ("Master Lease") and the applicable Lease Line Schedule (defined below). The "Equipment" (as defined in the Lease Line Schedule) is being leased for commercial or business purposes only, and not for personal, home, or family purposes. The parties agree that each Lease is a "finance lease" under the Uniform Commercial Code (as in effect in the State of California during the term of the Lease and referred to hereafter as the "UCC").

2. LEASE LINE SCHEDULE. "Lease Line Schedule" means a Lease Line Schedule in the form of EXHIBIT A, signed by Lessor and Lessee and incorporating by reference the terms and provisions of this Master Lease.

3. EQUIPMENT SCHEDULES. "Equipment Schedule" means an Equipment Schedule in the form of EXHIBIT B, signed by Lessor and Lessee and incorporating, by reference, the terms and provisions of this Master Lease and the applicable Lease Line Schedule. Each Equipment Schedule shall constitute a separate and independent lease (a "Lease"); the original of such Lease shall consist of the signed Equipment Schedule and a copy of the Master Lease and applicable Lease Line Schedule. Capitalized terms used, but not defined, in this Master Lease have the meanings given to such terms in the applicable Lease Line Schedule or Equipment Schedule, as the case may be.

4. TERM AND RENTALS.

(a) ACCEPTANCE. The Lease shall commence with respect to Equipment described on the Equipment Schedule upon the Acceptance Date. The "Acceptance Date" shall be the date upon which Lessee executes a Delivery and Acceptance Certificate in the form of EXHIBIT C.

(b) TERM AND PAYMENT OF RENT. The lease term for the Equipment shall be the "Lease Term" set forth in the Equipment Schedule which shall commence on the "Commencement Date" (as defined in the Lease Line Schedule). Lessee agrees to pay to Lessor the "Rental Payments" for the Lease Term, in the amounts and at the times set forth in the Equipment Schedule.

(c) INTERIM PERIOD. If the Acceptance Date does not fall on the Commencement Date, then Lessee agrees to pay to Lessor "Interim Rent" for the period commencing on the Acceptance Date through and including the day preceding the Commencement Date (the "Interim Period"). The Interim Rent payment for the Interim Period shall accrue at the "Interim Rate" (as defined in the Lease Line Schedule) and shall be due and payable in full on the Commencement Date.

(d) LEASE TERMINATION. Lessee may terminate the Lease at the expiration of the Lease Term or any renewal term (the "Lease Termination") by submitting to Lessor a Notice of Election in the form of EXHIBIT D. If a Notice of Election is not submitted by Lessee to Lessor during the "Advance Notice Period" (as defined in the Lease Line Schedule), then the Lease Term or any renewal Term will be automatically extended for an additional period equal to the "Automatic Extension Period" (as defined in the Lease Line Schedule). The Lease will continue to automatically extend until Lessee submits to Lessor a Notice of Election. The Lease may only be

1

terminated as expressly provided in this Section, in the applicable Lease Line Schedule or in the applicable Equipment Schedule. Lessee agrees to continue paying rent for the Equipment in the amount of the Rental Payment set forth in the Equipment Schedule until the later of (i) the expiration of the Lease Term, any renewal term and any Automatic Extension Period and (ii) either (A) the purchase option price is paid pursuant to Section 6(a), or (B) a mutually agreed renewal of the Lease takes effect pursuant to Section 6(b), or (C) the Equipment is returned in the manner and condition prescribed in Section 6(c), in each case after delivery of a Notice of Election.

(e) NET LEASE. Each Equipment Schedule shall be a net lease, and Lessee's obligation to pay all rent and other sums thereunder shall be absolute and unconditional, and shall not be subject to any abatement, reduction, set-off, defense, counterclaims, interruption, deferment or recoupment, for any reason whatsoever.

5. LATE FEE. Lessee shall pay a late charge on any rent payments or other sums due hereunder which are past due, in the amount specified in the Lease Line Schedule, payable on demand. In addition, interest shall accrue daily at the "Default Rate" (as defined in the Lease Line Schedule), or if such rate exceeds the maximum rate allowed by law, then at such maximum rate, and shall be payable on demand.

6. LEASE TERMINATION OPTIONS. Upon Lease Termination, Lessee will have the option to purchase the Equipment, renew the term of the Lease, or return the Equipment to Lessor, as set forth below. Lessee shall specify its election of a Lease Termination Option in the Notice of Election.

(a) PURCHASE OPTION. If Lessee exercises the option to purchase, then, provided no Event of Default has occurred and is then continuing, Lessee shall at the expiration of the Lease Term, renewal term or extension, as the case may be, purchase the Equipment. The purchase price shall be the Equipment's then fair market value ("FMV"). FMV, as applied to a purchase option, shall be determined by Lessor based on the price a willing buyer would pay and a willing seller would accept (neither buyer nor seller being under compulsion to act) for the Equipment as installed and in use, giving due consideration to its condition, utility, revenue-producing capability, and replacement costs. If Lessee fails to agree with Lessor's good faith determination of the FMV, Lessee shall nevertheless pay Lessor's invoice and provide Lessor with a written request for a determination of the FMV with or prior to such payment. Within ten
(10) days after such request Lessor and Lessee shall agree on an appraiser to determine the FMV or, lacking such agreement, shall each tender the name of an appraiser. The appraiser(s) shall, within thirty (30) days, either agree on the FMV or select a third appraiser, to form a committee to determine the FMV. Determination by the appraiser(s) shall be final and binding on both parties. Within fifteen (15) days after such determination, Lessor shall refund any excess received over the FMV, and/or Lessee shall pay any additional amount of the FMV above the amount previously paid. Each party shall bear the fees and expenses of any appraiser which it names and share equally the fees and expenses of any appraiser(s) jointly selected. If the appraised FMV is within 5% of the amount invoiced by Lessor, then Lessee shall pay all appraiser fees and expenses. The purchase option price shall be paid not later than the last day of the Lease Term.

(b) RENEWAL. If Lessee exercises the option to renew this Lease, such renewal shall be upon the terms and conditions of this Master Lease and the applicable Lease Line Schedule, for a rental period and rental amount to be agreed upon by Lessee and Lessor.

(c) RETURN. If the Notice of Election specifies return of the Equipment, Lessee at its own risk and expense (i) will immediately return the Equipment to Lessor in the same condition as when delivered, ordinary wear and tear excepted, at such location as Lessor shall designate; and (ii) will, on request from Lessor, obtain from the Equipment supplier (or other maintenance service supplier approved by Lessor) a certificate stating that the Equipment qualifies for continued maintenance service at the standard rates and terms then in effect.

7. USE; MAINTENANCE.

(a) Lessee, at its expense, shall make all necessary site preparations and cause the Equipment to be operated in accordance with any applicable operating manuals and manufacturer's instructions. Notwithstanding any transfer or assignment by Lessor and provided Lessee is not in default hereunder, Lessee shall have the right to quietly possess and use the Equipment as provided herein without interference by Lessor, its assigns or any other third party claiming through or under Lessor.

2

(b) Lessee shall effect and bear the expense of all necessary repair, maintenance, operation and replacements required to be made to maintain the Equipment in good condition, reasonable wear and tear excepted, and to comply with all domestic and international laws to which the use and operation of the Equipment may be or become subject. All replacement Equipment and parts furnished in connection with such maintenance or repair shall immediately become the property of Lessor and part of the Equipment for all purposes hereof. All such maintenance, repair and replacement services shall be immediately paid for and discharged by Lessee with the result that no lien under any applicable laws will attach to the Equipment as a result of the performance of such services or the provision of any such material.

8. INSURANCE. Lessee shall obtain and maintain for the Lease Term (and any renewal term or extension), at its own expense, (a) "all risk" insurance against loss or damage to the Equipment, (b) commercial general liability insurance (including contractual liability, products liability and completed operations coverage) reasonably satisfactory to Lessor, and (c) such other insurance against such other risks of loss and with such terms, as shall in each case be reasonably satisfactory to or reasonably required by Lessor (as to carriers, amounts and otherwise). The amount of the "all risk" insurance shall be greater than or equal to the Stipulated Loss Value (as defined in Section 9 below) of all Equipment outstanding under the Lease Line Schedule, and must otherwise be reasonably satisfactory to Lessor as of each anniversary date of this Lease. Any increase in the amount of such insurance coverage, other than "all risk", reasonably requested by Lessor shall be put into effect on the next succeeding renewal date of such insurance.

Each "all risk" policy shall: (i) name Lessor as sole loss payee with respect to the Equipment, (ii) provide for each insurer's waiver of its right of subrogation against Lessor and Lessee, and (iii) provide that such insurance shall not be invalidated by any action of, or breach of warranty by, Lessee of a provision of any of its insurance policies, and shall waive set-off, counterclaim or offset against Lessor.

Each liability policy shall name Lessor as an additional insured and provide that such insurance shall have cross-liability and severability of interest endorsements (which shall not increase the aggregate policy limits of Lessee's insurance).

All insurance policies shall provide that Lessee's insurance shall be primary without a right of contribution of Lessor's insurance, if any, or any obligation on the part of Lessor to pay premiums of Lessee, and shall contain a clause requiring the insurer to give Lessor at least 30 days' prior written notice of its cancellation (other than cancellation for non-payment for which 10 days' notice shall be sufficient. Lessee shall on or prior to the date of Equipment Schedule No. 1 and prior to each policy renewal, furnish to Lessor certificates of insurance or other evidence satisfactory to Lessor that such insurance coverage is in effect. Lessee further agrees to give Lessor prompt notice of any damage to, or loss of, the Equipment, or any part thereof.

9. LOSS OR DAMAGE. If any items of Equipment shall become lost, stolen, destroyed, or damaged beyond repair for any reason, or in the event of condemnation, confiscation, seizure or requisition of title to or use of such items (collectively, an "Event of Loss"), Lessee shall promptly pay to Lessor the applicable Stipulated Loss Value of the Equipment subject to the Event of Loss. Upon payment by Lessee of the Stipulated Loss Value, Lessor will transfer to Lessee, "AS IS, WHERE IS, WITHOUT RECOURSE, REPRESENTATION OR WARRANTY," all of Lessor's right, title and interest, if any, in such items of Equipment. The "Stipulated Loss Value" payable by Lessee under this Lease shall be an amount equal to the product of (a) Lessor's Cost of the affected Equipment and (b) the percentage set forth in the table attached to the applicable Lease Line Schedule as ANNEX A opposite the Rental Payment number next following the Event of Loss. Stipulated Loss Values and Rental Payments shall not be prorated.

10. TITLE, INSPECTION AND LOCATION.

(a) TITLE. Lessor and Lessee confirm their intent that title to the Equipment shall remain in Lessor (or its successors and assigns) exclusively. If requested by Lessor, Lessee will affix plates or markings on the Equipment and on any operating manuals and manufacturer's instructions indicating the interests of Lessor and its assigns therein, and Lessee will not allow any other indicia of ownership or other interest in the Equipment to

3

be placed on the Equipment. Lessee shall not sell, assign, grant a security interest in, sublet, pledge, hypothecate or otherwise encumber or suffer a lien upon or against this Lease or the Equipment.

(b) INSPECTION. Lessor (through any of its officers, employees or agents) shall have the right to inspect the Equipment during regular business hours, with reasonable notice, and in compliance with Lessee's reasonable security procedures; provided, that such inspections will be conducted no more often than every six (6) months unless an Event of Default, or event which, with notice or lapse of time or both, would become an Event of Default, has occurred and is continuing.

(c) LOCATION. In the case of Equipment other than mobile Equipment, Lessee may move such Equipment from the installation address shown on the Equipment Schedule (or any other location for which Lessee has complied with this provision) only if (i) the new location is within the continental United States, and (ii) Lessee gives at least 30 days' prior written notice of the relocation and provides UCC-1 financing statements, landlord waivers or such other documentation as Lessor reasonably requests to protect its interest in the Equipment. In the case of mobile equipment (including, without limitation, lap-top computers), Lessee agrees to obtain from the person using such mobile Equipment and deliver to Lessor, an Acknowledgment in the form of EXHIBIT F.

(d) Lessee shall keep copies of all operating manuals and manufacturer's instructions with respect to the Equipment in good condition at the locations specified in Section 10(c).

11. LESSEE'S REPRESENTATIONS, WARRANTIES AND WAIVERS. Upon execution of the Master Lease and each Equipment Schedule, Lessee warrants and represents the following:

(a) Lessee is a corporation duly organized, validly existing and in good standing under the laws of its state of incorporation. Lessee has full power and authority and all necessary licenses and permits to carry on its business as presently conducted, to own or hold under lease its properties and to enter into this Master Lease, the Lease Line Schedule and each Equipment Schedule and to perform its obligations thereunder; and Lessee is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the character of its properties or the nature of its business or the performance of its obligations under this Master Lease, the Lease Line Schedule and any Equipment Schedule requires such qualification, except for such jurisdictions in which failure to qualify would not have a material adverse effect on Lessee.

(b) The execution and delivery by Lessee of this Master Lease, the Lease Line Schedule and each Equipment Schedule and the performance by Lessee of its obligations thereunder have been duly authorized by all necessary corporate action on the part of Lessee; and do not and will not contravene the provisions of, or constitute a default (either with or without notice or lapse of time, or both) under, or result in the creation of any lien upon, the Equipment or any property of Lessee under any indenture, mortgage, contract or other instrument to which Lessee is a party or by which Lessee or its properties is bound.

(c) No consent or approval of, giving of notice to, registration with, or taking of any other action by, any state, federal, foreign or other governmental commission, agency or regulatory authority or any other person or entity is required for the consummation or performance by Lessee of the transactions contemplated under this Master Lease, the Lease Line Schedule and each Equipment Schedule.

(d) This Master Lease, the Lease Line Schedule and each Equipment Schedule, when executed by Lessee, constitute legal, valid and binding agreements of Lessee enforceable against Lessee in accordance with their terms, except as limited by any bankruptcy, insolvency, reorganization, or other similar laws of general application affecting the enforcement of creditor or Lessor rights.

(e) There are no actions, suits or proceedings pending or threatened against or affecting Lessee or any property of Lessee in any court, before any arbitrator of any kind or before or by any federal state, municipal or other government department, commission, board, bureau, agency or instrumentality (collectively "Governmental Body"), which, if adversely determined, would materially adversely affect the business, financial condition, assets, or operations of Lessee, or adversely affect the ability of Lessee to perform its obligations under

4

this Master Lease, the Lease Line Schedule and each Equipment Schedule; and Lessee is not in default with respect to any order of any court, arbitrator or Governmental Body or with respect to any material loan agreement, debt instrument or contract with a supplier or customer of Lessee, except as disclosed in writing to Lessor.

(f) To the extent permitted by applicable law, Lessee waives any and all rights and remedies to: (i) cancel this Lease; (ii) repudiate this Lease; (iii) reject the Equipment; (iv) revoke acceptance of the Equipment; (v) recover damages from Lessor for any breaches of warranty or for any other reason; (vi) claim a security interest in the Equipment in Lessee's possession or control for any reason; (vii) deduct from Rental Payments all or any part of any claimed damages resulting from Lessor's default, if any, under this Lease;
(viii) accept partial delivery of the Equipment; (ix) "cover" by making any purchase or lease of or contract to purchase or lease equipment in substitution for Equipment designated in the Lease; (x) recover any direct, general, special, incidental, indirect, exemplary or consequential damages, for any reason whatsoever; and (xi) obtain specific performance, replevin, detinue, sequestration, claim and delivery or the like for any Equipment identified to this Lease. To the extent permitted by applicable law, Lessee also waives any rights now or hereafter conferred by statute or otherwise which may require Lessor to sell, lease or otherwise use any Equipment in mitigation of Lessor's damages or which may otherwise limit or modify any of Lessor's rights or remedies.

12. ASSIGNMENT BY LESSOR. LESSEE ACKNOWLEDGES THAT LESSOR MAY SELL, ASSIGN, GRANT A SECURITY INTEREST IN, OR OTHERWISE TRANSFER ALL OR ANY PART OF ITS RIGHTS, TITLE AND INTEREST IN THIS LEASE AND THE EQUIPMENT WITHOUT NOTICE TO OR CONSENT OF LESSEE. Upon Lessor's written notice to Lessee that this Lease, or the right to the Rental Payments hereunder, have been assigned, Lessee shall, if requested, pay directly to Lessor's assignee without abatement, deduction or set-off all amounts which become due hereunder. Lessee waives and agrees it will not assert against Lessor's assignee any counterclaim or set-off in any action for rent under the Lease. Upon the assignment of this Lease, Lessor's assignee shall have and be entitled to exercise any and all rights and remedies (but none of the obligations) of lessor hereunder, and all references herein to Lessor shall include Lessor's assignee. Lessee acknowledges that any assignment or transfer by Lessor does not materially change Lessee's duties or obligations under this Lease nor materially increase the burdens or risks imposed on Lessee.

13. ASSIGNMENT BY LESSEE. LESSEE MAY NOT, WITHOUT LESSOR'S PRIOR WRITTEN CONSENT, (I) ASSIGN THIS LEASE, WHETHER BY OPERATION OF LAW OR OTHERWISE, OR SUBLEASE THE EQUIPMENT OR ANY PART THEREOF OR (II) ASSIGN, GRANT A SECURITY INTEREST IN, OR OTHERWISE TRANSFER ALL OR ANY PART OF ITS RIGHTS, TITLE AND INTEREST IN AND TO THIS LEASE OR THE EQUIPMENT. In the event Lessee makes an assignment, sublease or other transfer (to which Lessor has consented), Lessee shall not thereby be relieved of its duties and obligations hereunder, for which it shall remain fully responsible and liable (independent of its assignee).

14. TAXES.

(a) Lessee shall comply with all applicable federal, state, local, foreign and international laws, regulations and orders relating to this Lease. Lessee assumes liability for, and shall pay when due, and on a net after-tax basis shall indemnify and defend Lessor against, all federal, state, local, foreign and international fees, taxes and government charges (including, without limitation, interest and penalties) of any nature imposed upon or in any way relating to Lessor, Lessee, any item of Equipment or this Lease, except federal, state and local taxes on or measured by Lessor's net income (other than any such tax which is in substitution for or relieves Lessee from the payment of taxes it would otherwise be obligated to pay to or reimburse Lessor for as herein provided). Lessee shall at its expense file when due with the appropriate authorities any and all tax and similar returns and reports required to be filed with respect thereto or, if requested by Lessor, notify Lessor of all such requirements and furnish Lessor with all information required for Lessor to effect such filings, which filings shall also be at Lessee's expense. Any fees, taxes or other charges paid by Lessor upon failure of Lessee to make such payments shall at Lessor's option become immediately due from Lessee to Lessor.

(b) This Lease has been entered into on the assumption that Lessor shall be entitled to all deductions, credits, and other tax benefits as are provided in the Internal Revenue Code of 1986, including amendments as may occur (the "Code"), to an owner of property including, without limitation, depreciation

5

deductions and interest deductions with respect to any debts incurred to finance the purchase of the Equipment. If, as a result of any acts, omissions or misrepresentations by Lessee or as a result of any changes in the Code, the regulations issued thereunder or the administrative or judicial interpretations, Lessor's projected after-tax economic return resulting from ownership and lease of the Equipment is reduced, then Lessee's Rental Payments shall be increased in an amount (based on Lessor's reasonable calculations) sufficient to provide the same net after-tax economic return as if such acts or omissions or changes had not occurred. Appropriate increases shall also be made in the applicable Stipulated Loss Values for this Lease. In the event the Equipment is sold by Lessor to another party, the net after-tax economic returns considered shall be those of such other party.

15. EQUIPMENT WARRANTIES. Lessee acknowledges that (i) Lessee has selected the supplier of the Equipment, (ii) Lessor acquired the goods or the right to possession and use of the goods in connection with the Lease, and (iii) Lessee received a copy of the contract by which Lessor acquired the Equipment or the right to possession and use of the Equipment before signing the Lease.
LESSOR MAKES NO EXPRESS OR IMPLIED WARRANTIES INCLUDING THOSE OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE WITH RESPECT TO THE EQUIPMENT AND DISCLAIMS THE SAME. Lessor shall have no liability for any damages, whether direct, indirect, general, special, incidental, exemplary or consequential, incurred by Lessee as a result of any defect or malfunction of the Equipment. Lessee shall look solely to the Equipment supplier for any and all claims related to the Equipment. Lessor assigns to Lessee, for and during the Lease Term, any warranty on the Equipment provided by the supplier. Lessor and Lessee agree that all limitations on remedies and liability contained in this Lease represent a reasonable allocation of risks that is part of the fundamental bargain between the parties.

16. EVENTS OF DEFAULT. An Event of Default shall occur if Lessee (i) fails to pay any Rental Payment or other payment required under the Lease when due and such failure continues for a period of five (5) days after written notice from Lessor; or (ii) fails to perform or observe any other covenant, condition or agreement to be performed or observed by it or breaches any provision contained in the Lease or in any other document furnished to Lessor in connection herewith, and such failure or breach continues for a period of thirty
(30) days after written notice from Lessor; or (iii) without Lessor's consent, attempts to assign this Lease or sell, transfer, encumber, part with possession, or sublet any item of Equipment; or (iv) makes any representation or warranty herein or in any document furnished by Lessee in connection herewith, which shall have been materially false or inaccurate when made or at the time to which such representation or warranty relates; or (v) shall commit an act of bankruptcy or become insolvent or bankrupt or make an assignment for the benefit of creditors or consent to the appointment of a Trustee or Receiver or either shall be appointed for Lessee or for a substantial part of its property without its consent, or bankruptcy reorganization, or insolvency proceedings shall be instituted by or against Lessee, and, if instituted against Lessee, shall not be vacated or dismissed within sixty (60) days. Any Event of Default shall be deemed material and a substantial impairment of Lessor's interests for the purposes of this Lease, the UCC, and any other applicable law.

17. REMEDIES. Upon the occurrences of any Events of Default and at any time thereafter, provided such Event of Default is then continuing, Lessor may, in its discretion, do any one or more of the following:

(a) cancel any or all Leases which reference this Master Lease or the Lease Line Schedule, upon notice to Lessee;

(b) recover any accrued and unpaid Rental Payments and other amounts which are due and owing under the Leases so canceled on the Rental Payment Date immediately preceding the date on which Lessor obtains possession of the Equipment (or such earlier date as judgment is entered in favor of Lessor) (the "Determination Date"), plus interest at the Default Rate;

(c) with or without canceling this Lease, recover (i) such Stipulated Loss Value as of the Rental Payment Date immediately preceding the Determination Date, and (ii) the amount of any loss or reduction of tax benefits which Lessor anticipated it would receive if the Lease continued for its full Lease Term;

(d) recover any amounts due under any indemnity then determinable, plus interest at the Default Rate;

6

(e) require that Lessee provide the return and certification of the Equipment in accordance with Section 6(c) hereof;

(f) enter the premises where such Equipment is located and take immediate possession of and remove the same, all without liability to Lessor or its agents for such entry;

(g) sell any or all of the Equipment at public or private sale, with or without notice to Lessee or advertisement, or otherwise dispose of, hold, use, operate, lease to others or keep idle such Equipment, all free and clear of any rights of Lessee and without any duty to account to Lessee for such action or inaction or for any proceeds with respect thereto; and

(h) exercise any other right or remedy which may be available to it under the UCC or other applicable law including the right to recover damages for the breach hereof.

In addition, Lessee shall be liable for, and reimburse Lessor for, all reasonable legal fees and all commercially reasonable costs and expenses incurred by Lessor as a result of the foregoing defaults or the exercise of Lessor's remedies, including without limitation recovering possession of the Equipment, selling or leasing the Equipment (including broker's and sales representative's fees and commissions), and placing any Equipment in the condition and obtaining the certificate required by Section 6(c) hereof. No remedy referred to in this Section is intended to be exclusive, but each shall be cumulative and in addition to any other remedy referred to above or otherwise available to Lessor at law or in equity. No express or implied waiver by Lessor of any default shall constitute a waiver of any other default by Lessor, or a waiver of any of Lessor's rights.

18. INDEMNIFICATION. Lessee assumes liability for, and shall pay when due, and shall indemnify, reimburse and hold each Indemnified Person (defined below) harmless from and against all Claims (defined below), directly or indirectly relating to or arising out of the acquisition, use, manufacture, purchase, shipment, transportation, delivery, installation, lease or sublease, ownership, operation, possession, control, storage, return or condition of any item of Equipment (regardless of whether such item of Equipment is at the time in the possession of Lessee), the falsity of any non-tax representation or warranty of Lessee or Lessee's failure to comply with the terms of the Lease during the Lease Term. The foregoing indemnity shall cover, without limitation,
(i) any Claim in connection with a design or other defect (latent or patent) in any item of Equipment, (ii) any Claim for infringement of any patent, copyright, trademark or other intellectual property right, or (iii) any Claim for negligence or strict or absolute liability in tort; provided, however, that Lessee shall not indemnify Lessor for any liability incurred by Lessor as a direct and sole result of Lessor's gross negligence or willful misconduct.

"Claim" means all liabilities, losses, damages, actions, suits, demands, claims of any kind and nature (including, without limitation, claims relating to environmental discharge, cleanup or compliance), and all costs and expenses whatsoever to the extent they may be incurred or suffered by an Indemnified Person in connection therewith (including, without limitation, reasonable attorneys' fees and expenses), fines, penalties (and other charges of applicable governmental authorities), licensing fees relating to any item of Equipment, damage to or loss of use of property (including, without limitation, consequential or special damages to third parties or damages to Lessee's property), or bodily injury to or death of any person (including, without limitation, any agent or employee of Lessee).

"Indemnified Person" means Lessor (including without limitation, each of its partners) and each of their respective successors, assigns, agents, officers, directors, shareholders, partners, servants, agents and employees.

Such indemnities shall continue in full force and effect, notwithstanding the expiration or termination of this Lease. Upon Lessor's written demand, Lessee shall assume and diligently conduct, at its sole cost and expense, the entire defense of any Indemnified Person against any indemnified Claim described in this SECTION 18. Lessee shall not settle or compromise any Claim against or involving Lessor without first obtaining Lessor's written consent thereto, which consent shall not be unreasonably withheld. Lessee shall give Lessor prompt notice of any occurrence, event or condition in connection with which Lessor may be entitled to indemnification hereunder. The provisions of this SECTION 18 are in addition to, and not in limitation of, the provisions of SECTION 14(b).

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19. NOTICES. Any notices or demands required or permitted hereunder shall be given to the parties in writing and by personal delivery, regular or certified mail, facsimile or telegram at the address set forth in the Lease Line Schedule or to such other address as the parties may hereafter substitute by written notice given in the manner prescribed in this Section. Such notices or demands shall be deemed given upon receipt in the case of personal delivery and upon mailing or transmission in the case of mail, facsimile or telegram. Lessee agrees to provide Lessor with thirty (30) days' prior written notice of (a) any merger or consolidation with or into any other business organization, (b) any sale, lease or other disposition of assets not in the ordinary course of business, and (c) any other material change in Lessee's financial structure or ownership.

20. FURTHER ASSURANCES. Lessee will promptly execute and deliver to Lessor such further reasonable documents and take such further reasonable action as Lessor may request in order to more effectively carry out the intent and purpose of this Lease or an assignment of Lessor's interest herein.

21. MISCELLANEOUS. This Lease shall be binding upon and inure to the benefit of the parties hereto, their permitted successors and assigns. Any provision of the Lease which is unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof; and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction; provided, however, that to the extent that the provisions of any such applicable law can be waived, they are waived by Lessee. Time is of the essence with respect to the Lease. The captions set forth herein are for convenience only and shall not define or limit any of the terms hereof. THIS LEASE SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT REFERENCE TO CONFLICT OF LAWS PRINCIPLES. LESSOR AND LESSEE WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY LITIGATION ARISING FROM THIS LEASE. THIS LEASE SHALL BECOME EFFECTIVE AND BINDING ON THE PARTIES, THEIR RESPECTIVE SUCCESSORS AND PERMITTED ASSIGNS, AND SHALL BE DEEMED EXECUTED AND PERFORMED IN THE STATE OF CALIFORNIA, WHEN THE RELATED EQUIPMENT SCHEDULE IS ACCEPTED BY LESSOR. LESSEE CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE COURTS OF CALIFORNIA FOR THE RESOLUTION OF ANY DISPUTES HEREUNDER.

22. AMENDMENTS, MODIFICATIONS, WAIVERS. NONE OF THE PROVISIONS OF THIS LEASE MAY BE AMENDED, MODIFIED OR WAIVED EXCEPT IN A WRITING SIGNED BY LESSOR AND LESSEE.

    INITIALS /s/ KG   (LESSEE)       INITIALS _______ (LESSOR)

LESSEE:                              LESSOR:

SAGENT TECHNOLOGY, INC.              LIGHTHOUSE CAPITAL PARTNERS, L.P.

By:    /s/ KENNETH C. GARDNER        By: LIGHTHOUSE MANAGEMENT
   ------------------------------        PARTNERS, L.P., its general partner

Name:   Kenneth C. Gardner
        -------------------                By:  LIGHTHOUSE CAPITAL
Title:     President                            PARTNERS, INC., its general partner
        ------------------
                                                By:
                                                     --------------------------------
                                                Name:   Richard D. Stubblefield
                                                     --------------------------------
                                                Title:   Managing Director
                                                      --------------------------------

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[LOGO]

EXHIBIT 10.7

NO. 5785949
MASTER LEASE AGREEMENT

Lessor:  DELL FINANCIAL SERVICES L.P.            Lessee:  SAGENT TECHNOLOGY INC.
Mailing Address:             Payment Address:             Address:
----------------             ----------------             --------
PO Box 811550                PO Box 99355                 800 W. El Camino
Chicago, Illinois            Chicago, Illinois            3rd Floor
60681-1550                   60693                        Mountain View, CA 94040
Fax:  _________________      Fax:  ________________       Fax:    650-493-1290
Attention:  COO              Attention:  __________       Attention:  KATHY OVALLE

This Master Lease Agreement (this "Agreement"), dated to be effective as of September 26, 1998 (the "Effective Date"), is between the Lessor and Lessee named above. Capitalized terms used in this Agreement and not defined in the body of this Agreement are defined in Section 25 of this Agreement. The parties agree as follows:

1. LEASE. Lessor hereby leases to Lessee and Lessee hereby leases from Lessor the Products that are described in any Lease Schedule to this Agreement (each a "Schedule") executed and to be executed by the parties hereto, in accordance with all of the terms and conditions of this Agreement. The provisions hereof shall be deemed to be incorporated into each Schedule and each Schedule shall constitute a separate lease of Products (a "Lease"). Except as may be specifically provided in this Agreement, in the event of any conflict between the terms of any Schedule and the terms of this Agreement, the terms of the Schedule shall govern. All rights not specifically granted to Lessee in this Agreement or in a Schedule are reserved by Lessor.

2. ACCEPTANCE, TERM AND RENT.

(a) All Products shall automatically be deemed to have been irrevocably accepted by Lessee ("Acceptance") upon the expiration of the 5th Business Day following the date the Products are shipped to Lessee (the "Acceptance Date") unless Lessee specifically rejects such Products by written notice to Lessor before the expiration of such period. The primary term of the Lease for any Product hereunder (the "Primary Term") shall be as provided in the Schedule related to such Product, subject to earlier termination as provided herein, and the first day of the Primary Term (the "Commencement Date") shall be either (i) the first day of the first month following the month in which the Acceptance Date occurs (if the Acceptance Date falls on or before the 20th day of the month) or (ii) the first day of the second month following the month in which the Acceptance Date occurs (if the Acceptance Date falls after the 20th day of the month). The period beginning on the Acceptance Date and ending on the last day of the Primary Term, together with any renewals or extensions thereof, is referred to herein as the "Lease Term." Each Lease of Products shall become effective as of the applicable Acceptance Date and, unless sooner terminated as provided herein or in the applicable Schedule, shall continue for the Lease Term. Subject to Section 2((b)), the amount of the rental payments ("Rent"), and the payment thereof, with respect to the Lease of any Product hereunder, shall be as provided in the relevant Schedule.

(b) For each Schedule, Lessee irrevocably authorizes Lessor to adjust the Products Acquisition Amount set forth on such Schedule and the related Rent by no more than 10% to account for costs to Lessor associated with change orders, returns, invoicing errors and similar matters. Lessee agrees to any resulting adjustments in the transaction's terms, if different from those stated in the applicable Schedule.

3. PAYMENT OBLIGATION.

(a) Rent shall be due on the first day of each Payment Period (as stated in the related Schedule) starting on the Commencement Date; provided, however, that added to the first payment of Rent shall be a prorated Rent calculated based on a 30-day month for the period from the Acceptance Date to the Commencement Date. Rent paid in advance, if any, shall be applied to the first Rent due and then to the final payments of Rent, in reverse order, or, at Lessor's option, to payment of any overdue obligation of Lessee (including Rent owed with respect to other Products). All Rent and other amounts due and payable under this Agreement or any Schedule shall be paid to Lessor in immediately available funds of the United States of America at the payment address for Lessor set forth above or at such other address as Lessor may designate from time to time. Rent shall be due and payable whether or not Lessee has received any notice that such Rent is due.

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(b) EACH LEASE SHALL BE A NET LEASE, and any Rent or other amounts set forth in this Agreement or any Schedule shall not include insurance, handling costs, shipping or other transportation costs (except as may be specifically provided in any Schedule); or sales, use, excise, turnover, purchase, property, luxury, added value or other taxes, fees, levies or assessments, or (to the extent Lessor may consent to Lessee's transfer of any Products to Persons outside the United States of America) customs duties or surcharges on imports or exports (collectively, "Taxes or Duties"), with respect to the Products, this Agreement or any Lease, all of which shall be paid directly by or charged to the account of Lessee. If Lessee claims eligibility for exemption from any tax, it shall provide Lessor with a tax exemption certificate acceptable to the relevant taxing authority. Any such Tax or Duty Lessor may be required to collect or pay (other than taxes based on the net income of Lessor) shall be paid by Lessee and, if not specifically set forth in this Agreement or the applicable Schedule as payable concurrently with the payment of Rent, shall be due and payable to Lessor on demand.

(c) LESSEE'S OBLIGATION TO PAY ALL RENT AND OTHER AMOUNTS WHEN DUE AND TO OTHERWISE PERFORM AS REQUIRED UNDER THIS AGREEMENT OR ANY SCHEDULE SHALL BE ABSOLUTE AND UNCONDITIONAL, AND SHALL NOT BE SUBJECT TO ANY ABATEMENT, REDUCTION, SET-OFF, DEFENSE, COUNTERCLAIM, INTERRUPTION, DEFERMENT OR RECOUPMENT FOR ANY REASON WHATSOEVER WHETHER ARISING OUT OF THIS AGREEMENT, ANY SCHEDULE, LESSOR'S STRICT LIABILITY OR NEGLIGENCE, THE CONDUCT OF A THIRD PARTY, TOTAL OR PARTIAL LOSS OF PRODUCTS OR THEIR USE OR POSSESSION, OR OTHERWISE. If any Product is unsatisfactory for any reason, Lessee shall make any claim solely against the manufacturer or supplier of such Product and shall, nevertheless, pay Lessor or its assignee all amounts due and payable under the Lease.

4. LICENSED MATERIALS. Notwithstanding anything to the contrary in this Agreement or any Schedule, neither this Agreement nor any Schedule grants any right, title or interest in or to that portion of any Products constituting or containing Software or Documentation (collectively, "Licensed Materials"). Any rights that Lessee may have with respect to Licensed Materials shall arise only pursuant to license agreements between Lessee and the licensor(s) of such Licensed Materials (collectively, the "Licensors") which license agreements (the "Licenses") may be contained within the packaging associated with the Products. All title to and ownership of the Licensed Materials (both to the original and any whole or partial reproductions of the same, and all rights therein, including all rights in patents, copyrights, trade secrets and other intellectual property rights applicable thereto) is and shall remain in the Licensors during and after the term of this Agreement. Any use of the terms "sell," "purchase," "license," "lease," and the like in this Agreement or any Schedule with respect to Licensed Materials shall be interpreted in accordance with this Section 4.

5. PERFORMANCE BY LESSOR. As between Lessor and Lessee, Lessor shall have the right to accept or reject in Lessor's sole discretion any request by Lessee for the leasing of Products under this Agreement. No Lease shall commence until Lessor signs the related Schedule. Each Schedule shall be binding upon Lessor and Lessee from the date it is accepted and executed by Lessor; provided, however, that Lessor shall have no obligations with respect to any Schedule unless before the earlier of the expiration of credit approval or the expiration of the price quotation (i) Lessor receives from Lessee, in a form acceptable to Lessor in its sole discretion, the originals of a fully signed and completed Schedule and such other documents as Lessor may require, (ii) Acceptance of the Products has occurred, (iii) Lessor receives clear and unencumbered title to the Products (excluding Licensed Materials), and (iv) no Event of Default, or any event which, with the passage of time, the giving of notice, or both, would give rise to an Event of Default ("Default") shall have occurred. In the event that all of the foregoing conditions have not been satisfied within such period, Lessor may, at Lessor's election, terminate such Schedule and Lessor shall thereafter have no further liabilities or obligations with respect thereto. If Lessor has accepted a Purchase Agreement Assignment (an "Assignment") with respect to any Products but the Schedule applicable to such Products has been terminated in accordance with the preceding sentence, Lessor may by notice to Lessee be relieved of all further liabilities or obligations with respect to such Products and transaction and reassign all rights and obligations under such Assignment to Lessee without recourse or warranty and Lessee shall reimburse Lessor for all expenses and other amounts incurred by Lessor with respect to such Products and transaction, plus interest at the Overdue Rate from the date such amounts were incurred by Lessor through the date such amounts are reimbursed by Lessee.

6. USE; LOCATION; INSPECTION. Except as may be specifically provided in any Schedule, Lessee shall be solely responsible for (i) unpacking and installation of the Products and (ii) deinstalling and repacking the Products for return in accordance with Section 7. Lessee shall cause Products to be possessed and operated only (i) in accordance with the Documentation and Applicable Laws (including intellectual property laws), and (ii) for the internal business purposes of Lessee and not for any other use or disposition. Lessee agrees to comply with all terms and conditions of any Licenses. Lessee agrees not to remove Products from the locations set forth in the related Schedule without Lessor's prior written consent, which consent shall not be unreasonably withheld; provided, however, Lessee may without Lessor's consent remove from such location any such Products which are designated on the applicable Schedule as mobile equipment. Lessee shall allow Lessor and the Licensors to inspect the premises where the Products are located from time to time during reasonable hours after reasonable notice in order to confirm Lessee's compliance with its obligations under this Agreement and the Licenses, and shall correct any deficiencies promptly upon notice from Lessor and/or one or more of the Licensors.

7. RETURN. At the expiration of the Lease Term for any Product or earlier termination of each Lease, Lessee agrees (i) unless otherwise provided by the applicable License(s), to terminate its use of all Licensed Materials provided to Lessee under such Schedule and to return the same to Lessor at a place within the continental United States reasonably designated by Lessor, together with an

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assignment of all of Lessee's rights under the applicable License(s), and (ii) to terminate its use of, and return to Lessor at a place within the continental United States reasonably designated by Lessor, all other Products leased to Lessee under such Schedule.

8. RISK OF LOSS; MAINTENANCE; UNINSURED LOSS AND DAMAGE. Lessee assumes all risk of loss or damage to Products from the time such Products are delivered to a carrier for shipment to Lessee until their return to Lessor and agrees to maintain the Products in good operating condition, in compliance with all requirements necessary to enforce all Product warranty rights, and to return the Products to Lessor as provided in Section 7 in good operating condition (ordinary wear and tear excepted). During the Lease Term, Lessee shall ensure that each Product is covered by a maintenance agreement (if available) from the manufacturer of such Product or another Person that is reasonably acceptable to Lessor. If a Product shall become lost, stolen, destroyed or damaged beyond repair or in the event of any condemnation, confiscation, seizure or expropriation of such Product, Lessee shall promptly notify Lessor of the same and shall immediately pay to Lessor the value of such Product calculated by discounting to present value the aggregate of all unpaid amounts due or to become due to Lessor with respect to such Product under this Agreement or any Schedule as Rent or otherwise (including the purchase option amount determined in accordance with the applicable Schedule or the estimated in-place fair market value at the end of the Lease Term as determined by Lessor if no purchase option is provided in such Schedule) using the discount rate of the Federal Reserve Bank of Chicago on the date of such occurrence plus 1%, at which time Lessor shall transfer to Lessee all of Lessor's right, title and interest, if any, in such Product (but not any Licensed Materials), AS IS, WHERE IS, WITHOUT RECOURSE
OR WARRANTY, EXPRESS, IMPLIED OR OTHERWISE, INCLUDING ANY WARRANTIES OF DESIGN, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, ANY WARRANTIES AGAINST INFRINGEMENT, OR ANY WARRANTIES ARISING FROM COURSE OF DEALING, USAGE OR TRADE PRACTICE, ALL OF WHICH SHALL BE SPECIFICALLY DISCLAIMED BY LESSOR.

9. ALTERATIONS. Lessee shall, at its expense, make such alterations to Products during the Lease Term as may be required by Applicable Laws. Lessee may make other alterations, additions or improvements to Products provided such other alterations, additions or improvements do not violate any License or materially decrease the value of Products or impair their utility. Lessee may remove any such other alteration, addition or improvement at the expiration of the relevant Lease Term, provided Lessee shall repair any damage to Products or the premises where located resulting from or occasioned by such removal and provided any such removal shall not violate any License or render Products incapable of use or operation for the purposes for which such Products were intended. Any alteration, addition or improvement shall be at Lessee's expense and, unless removed by Lessee as provided above, shall belong to and become the property of Lessor, subject to the terms of the applicable Lease during such Lease Term.

10. INSURANCE. From the date risk of loss passes to Lessee hereunder with respect to any Products and thereafter until all of Lessee's obligations under the related Lease have been performed in full, Lessee shall at its sole expense:

(a) Insure Products against "all risks" of physical loss or damage, including without limitation loss by fire (including extended coverage), theft, collision and such other risks of loss as are customarily covered by insurance on the type of products leased hereunder by prudent operators of businesses similar to that in which Lessee is engaged, in such amounts, in such form and with such insurers as shall be satisfactory to Lessor from time to time, but in no event shall such insurance be less than the full replacement value of the Products; and

(b) Maintain public liability and property damage insurance in respect of the use, operation and possession of the Products and the ownership thereof by Lessor with insurers satisfactory to Lessor in such form and with such limits of liability as Lessor may from time to time reasonably require.

Each insurance policy shall name Lessor (and if Lessor requests at any time, any successor, assignee or secured party of Lessor) as loss payee for physical damage insurance and as additional insured for liability and property damage insurance, and shall contain a clause requiring the insurer to give Lessor at least 30 days prior written notice of any alteration in the terms of such policy or of the cancellation thereof. At Lessor's request, Lessee shall furnish to Lessor a certificate or certificates of insurance or other evidence satisfactory to Lessor that such coverage is in effect, provided, however, that Lessor shall be under no duty to either ascertain the existence of or to examine such insurance policy or to advise Lessee in the event such insurance coverage shall not comply with the requirements of this Agreement or any Schedule. Lessee shall promptly notify Lessor of the occurrence of an event of loss and, at its expense, make all proofs of loss and take all other steps necessary to recover insurance benefits unless advised in writing by Lessor that Lessor desires so to do at Lessee's expense. Lessee irrevocably constitutes and appoints Lessor as its attorney-in-fact (i) to make, settle and adjust claims under each policy,
(ii) to make claims for monies which may become due under each policy including returned or unearned premiums and (iii) to endorse Lessee's name on any check, draft or other instrument received in payment of claims or returned or unearned premiums under each such policy and to apply the funds to the payment of amounts due by Lessee pursuant to this Agreement or the applicable Lease; provided, Lessor shall have no obligation to do any of the foregoing. Proceeds of insurance shall at the option of Lessor be disbursed by Lessor against satisfactory invoices for repair or replacement of Products, provided Lessee is not then in Default, or be retained by Lessor for application against Lessee's obligations hereunder, and if the proceeds received are less than the value of the Products subject to the loss, as determined pursuant to Section 8, Lessee shall pay to Lessor the amount of such deficiency.

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11. REPRESENTATIONS, WARRANTIES AND COVENANTS OF LESSEE. Lessee represents, warrants and covenants to Lessor that at all times during the term of this Agreement and any Schedule:

(a) Lessee is an entity duly organized and validly existing in good standing under the laws of the jurisdiction of its organization, has full power and authority to execute, deliver, and perform under this Agreement and each Schedule and all certificates and other documents required by, referred to in, or executed in connection with, this Agreement or any Schedule (collectively, the "Documents") to which it is a party, and is duly qualified and in good standing in all jurisdictions with respect to which its ownership or leasing of property or its conduct of business requires it to be so qualified;

(b) The execution, delivery and performance by Lessee of this Agreement, each Schedule and the other Documents to which it is a party have been duly authorized by all necessary corporate or other action on the part of Lessee, and this Agreement, each Schedule and the other Documents to which it is a party have been duly executed and delivered on Lessee's behalf by Persons duly authorized in that regard, and constitute the legal, valid and binding agreements of Lessee, enforceable against Lessee in accordance with their respective terms (subject to applicable bankruptcy and other similar laws);

(c) The execution, delivery and performance by Lessee of this Agreement, each Schedule and the other Documents to which it is a party do not and shall not result in a breach of, constitute a default under, contravene any provision of, or result in the creation of any lien on or in any property or assets of Lessee pursuant to, the Certificate or Articles of Incorporation or Bylaws of Lessee or any other documents pursuant to which Lessee is organized or operates, or any agreement, indenture or other instrument to which Lessee is a party or by which Lessee or any of its property or assets may be bound or affected;

(d) There is no action, suit or proceeding pending or, to the knowledge of Lessee, threatened in any court or tribunal or before any competent authority against Lessee or any of its property or assets which challenges this Agreement, any Schedule, any of the other Documents or any of the transactions contemplated hereby or thereby or which, in the reasonable and bona fide opinion of Lessee, may have a material adverse effect on the financial condition or business of Lessee; and

(e) The financial statements and other information furnished and to be furnished to Lessor by Lessee are and shall be true and correct.

If any Person guarantees payment or performance by Lessee of any liabilities or obligations of Lessee under this Agreement or any Schedule (a "Guarantor"), the preceding representations, warranties and covenants shall be deemed to be made by Lessee on behalf of such Guarantor as well as Lessee as if such Guarantor was named in addition to Lessee therein.

12. CONFIDENTIALITY.

(a) All information or materials disclosed by Lessor to Lessee, or obtained by Lessee from Lessor, under or in connection with this Agreement, any Schedule, or the transactions contemplated hereby or thereby, including information concerning Lessor's (or any vendor's or Licensor's) business activities, technical information, trade secrets, marketing plans, objectives, or financial results, and the terms and conditions of this Agreement and any Lease, regardless of whether the same is disclosed in writing, orally, visually or otherwise, are confidential and proprietary (collectively, the "Confidential Information"). Lessee shall receive and retain Confidential Information in confidence and shall use the same degree of care, but no less than a reasonable degree of care, as Lessee uses to protect its own similar information to protect the Confidential Information and to prevent (i) any use of Confidential Information other than in performance of its obligations under this Agreement or any Schedule; (ii) any dissemination of Confidential Information to any Person; or (iii) any publication of any Confidential Information (provided that Confidential Information may be disclosed to employees or professional advisors of Lessee to the extent such employees or advisors need to know such information in order to carry out the terms of this Agreement or otherwise utilize the Products in accordance with a Lease and agree to be bound by such obligations of nondisclosure and nonuse).

(b) The foregoing restrictions of confidentiality and nonuse shall not apply to any Confidential Information that (i) was known to Lessee at the time of the disclosure and was not obtained or derived, directly or indirectly, from Lessor; (ii) is or becomes available to the general public or generally known to Lessor's industry through no fault of Lessee; (iii) is obtained by Lessee from a third party which, to Lessee's knowledge, is lawfully in possession of the Confidential Information provided that, to Lessee's knowledge, such Confidential Information is not subject, in such third party's hands, to any confidential or nonuse obligations owed to Lessor or any third party; (iv) is disclosed by Lessor to a third party without a duty of confidentiality on the third party;
(v) is independently developed by Lessee without a breach of this Agreement or any Lease; or (vi) is disclosed by Lessee with the Lessor's prior written approval. The foregoing restrictions on confidentiality shall not prohibit Lessee from disclosing any Confidential Information that Lessee is required to disclose by government body, a court of law or Applicable Laws provided Lessee gives Lessor reasonable advance notice of the same so that Lessor may contest the disclosure or seek a protective order, and provided that Lessee complies with any such protective order.

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13. WARRANTY ASSIGNMENT; EXCLUSION OF WARRANTIES; LIMITATIONS ON LIABILITY.

(a) Lessor assigns to Lessee (to the extent assignable) the benefit of any limited warranty or right of return provided by any Licensor, manufacturer or vendor of the Products until such time as the Lease of such Product to Lessee has terminated or expired.

(b) LESSEE ACKNOWLEDGES THAT LESSOR DID NOT SELECT, MANUFACTURE OR SUPPLY ANY PRODUCT AND THAT LESSEE HAS MADE THE SELECTION OF PRODUCTS BASED UPON ITS OWN JUDGMENT AND EXPRESSLY DISCLAIMS ANY RELIANCE ON STATEMENTS MADE BY LESSOR OR ITS AGENTS. LESSEE FURTHER ACKNOWLEDGES THAT LESSOR LEASES PRODUCTS AS-IS AND MAKES NO WARRANTY, EXPRESS, IMPLIED, OR OTHERWISE, INCLUDING ANY WARRANTIES OF DESIGN, MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, ANY WARRANTIES OF TITLE OR AGAINST INFRINGEMENT, OR ANY WARRANTIES ARISING FROM A COURSE OF DEALING, USAGE OR TRADE PRACTICE, ALL OF WHICH ARE SPECIFICALLY DISCLAIMED BY LESSOR. LESSEE HEREBY WAIVES ANY CLAIM (INCLUDING ANY CLAIM BASED ON STRICT OR ABSOLUTE LIABILITY IN TORT) IT MIGHT HAVE AGAINST LESSOR FOR ANY LOSS, DAMAGE OR EXPENSE CAUSED BY OR WITH RESPECT TO ANY PRODUCTS. LESSEE HEREBY RELEASES AND FOREVER DISCHARGES LESSOR FROM ANY AND ALL ACTIONS, CLAIMS, DEMANDS, COSTS, EXPENSES, SET-OFFS, ABATEMENTS AND COMPENSATION WHATSOEVER, IN CONNECTION WITH THE FOREGOING, REGARDLESS OF THE FORM OF ACTION AND REGARDLESS OF WHETHER THE SAME ARISES FROM ANY NEGLIGENT ACT OR OMISSION OF LESSOR. Upon the parties' execution of a Schedule, Lessor shall be deemed to have fully performed and discharged all its obligations hereunder with respect to the related Products by providing Lessee with a possessory interest therein.

(c) Lessee agrees and acknowledges that it is the intent of both parties that each Lease qualify as statutory finance lease under Article 2A of the Uniform Commercial Code. Lessee acknowledges either (i) that Lessee has reviewed and approved any written supply contract covering the Products purchased from the supplier thereof for lease to Lessee or (ii) that Lessor has informed or advised Lessee, in writing, either previously or by this Agreement, that Lessee may have rights under the supply contract evidencing Lessor's purchase of the Products from the supplier chosen by Lessee and that Lessee should contact the supplier of the Products for a description of any such rights.

(d) LESSOR'S TOTAL LIABILITY FOR DAMAGES FOR ANY CAUSE WHATSOEVER ARISING UNDER OR RELATED TO THIS AGREEMENT, ANY SCHEDULE, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, REGARDLESS OF THE FORM OF ACTION, WHETHER IN CONTRACT OR IN TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, SHALL BE LIMITED TO THE TOTAL RENT PAID BY LESSEE TO LESSOR WITH RESPECT TO THE SCHEDULE THAT IS THE SUBJECT OF THE DISPUTE DURING THE TWELVE (12) MONTHS IMMEDIATELY PRECEDING THE DATE OF THE CLAIM. IN NO EVENT SHALL LESSOR BE LIABLE FOR (I) ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF OR RELATED TO THIS AGREEMENT, ANY SCHEDULE OR THE SALE, LEASE OR USE OF ANY PRODUCTS INCLUDING INTERRUPTION OF SERVICE, LOSS OF DATA, LOSS OF REVENUE OR PROFIT, LOSS OF TIME OR BUSINESS, OR ANY SIMILAR LOSS, EVEN IF LESSOR IS ADVISED IN ADVANCE OF THE POSSIBILITY OR CERTAINTY OF SUCH DAMAGES AND EVEN IF LESSEE ASSERTS OR ESTABLISHES A FAILURE OF ESSENTIAL PURPOSE OF ANY LIMITED REMEDY PROVIDED IN THIS AGREEMENT, OR (II) ANY CLAIM BY ANY THIRD PARTY EXCEPT AS MAY BE EXPRESSLY PROVIDED HEREIN.

14. EVENTS OF DEFAULT. It shall be an event of default hereunder and under any Lease ("Event of Default") if:

(a) Lessee fails to pay any Rent or other amounts payable under this Agreement or any Schedule when due and such failure shall have continued for 10 days;

(b) Any representation or warranty made by Lessee or any Guarantor to Lessor under, or in connection with entering into, this Agreement, any Schedule or any other Document is at any time untrue or incorrect;

(c) Lessee fails to comply with the provisions of Section 10 or Section 12 of this Agreement;

(d) Lessee fails to comply with any other obligation or provision of this Agreement or any Schedule and such failure shall have continued for 10 days after notice from Lessor;

(e) Any breach or default occurs under any agreement executed by any Guarantor for the benefit of Lessor (and, if capable of cure, is not cured within any applicable cure period set forth therein);

(f) Lessee or any Guarantor becomes insolvent or bankrupt, admits in writing its inability to pay its debts as they mature, or makes an assignment for the benefit of creditors; or Lessee or any Guarantor applies for or consents to the appointment of any receiver, trustee or similar officer for it or for all or any substantial part of its property (or such receiver, trustee or similar officer is appointed without its consent); or Lessee or any Guarantor institutes any bankruptcy, insolvency, reorganization, moratorium, arrangement, readjustment of debt, dissolution, liquidation or similar proceeding relating to it under the laws of any

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jurisdiction, or any such proceeding is instituted against Lessee or any Guarantor and is not dismissed within 30 days; or any judgment, writ, warrant or attachment or execution of similar process is issued or levied against a substantial part of the property of Lessee or any Guarantor and remains unsatisfied for 30 days;

(g) Lessee or any Guarantor dissolves, liquidates or otherwise terminates its existence as an entity, or consolidates with or merges with or into any entity, or sells, leases or otherwise disposes of all or substantially all of its assets, or incurs a substantial amount of indebtedness other than in the ordinary course of its business, or engages in a leveraged buy-out or any other form of corporate reorganization, in each case whether in a single transaction or in a series of related transactions, UNLESS in each case and before the event in question, either (i) Lessor, based on written confirmation from such party, is reasonably satisfied that such party's financial condition and credit standing shall not be impaired by the event, or (ii) such party's obligations under this Agreement, each Schedule and any Guaranty are assumed or guaranteed in a manner reasonably satisfactory to Lessor by an entity having in Lessor's good faith opinion at least as good financial condition and credit standing as those of such party immediately before the event;

(h) Lessee does or permits to occur any act which may in the reasonable opinion of Lessor materially lessen the value of any Products or Lessor's interest therein or increase the risk thereto; or

(i) Lessee or any Guarantor is in default under any other lease, contract, agreement or obligation now existing or hereinafter entered into with Lessor or any Affiliate of Lessor whether such party is bound alone or with others.

15. REMEDIES; TERMINATION.

(a) Upon an Event of Default Lessor may:

(i) require Lessee to return any or all Products as provided in Section 7;

(ii) without further notice, take possession of any or all Products ("Repossession") and for such purpose Lessee hereby (A) shall, if requested by Lessor, assemble the Products and deliver them to a location designated by Lessor and (B) grants Lessor the right to enter the premises where such Products are located for the purpose of Repossession;

(iii) terminate this Agreement and/or any or all Schedules;

(iv) without terminating or being deemed to have terminated this Agreement or any Schedule, sell, lease or otherwise dispose of any or all Products (as agent and attorney for Lessee to the extent necessary) upon such terms as Lessor deems advisable in its sole discretion ("Disposition"); or

(v) in addition to any other right or remedy Lessor may have at law or in equity, demand as a genuine pre-estimate of liquidated damages for loss of bargain and not as a penalty, the then present value of all the unpaid and future Rent together with any other amounts owed with respect to the Products, and (if any Products are not returned to or repossessed by Lessor) the present value of the purchase option amount for such Products determined in accordance with the applicable Schedule, or the estimated in-place fair market value of such Products at the end of the Lease Term as determined by Lessor if no purchase option is provided in such Schedule (calculated by discounting such amounts using the discount rate of the Federal Reserve Bank of Chicago, on the date of the Event of Default plus 1%), in which event Lessee shall immediately pay all such amounts to Lessor.

(b) Upon termination of this Agreement or termination or expiration of any Schedule, all right, title and interest of Lessee in or to the use of the Products subject to the terminated Schedule(s) shall absolutely cease and Lessee shall return any and all such Products as provided in Section 7. Termination of this Agreement shall constitute termination of all Schedules hereto, but termination or expiration of one or more Schedules shall not in and of itself constitute termination or expiration of this Agreement.

(c) Lessee shall pay all costs arising or incurred by Lessor as a result of any Default by Lessee or any Guarantor, including reasonable legal fees and costs related to the Repossession, re-conditioning and Disposition of any or all Products. Such costs shall be deducted from the proceeds of any Disposition. In the event an amount in excess of the amount described in clause 15(a)(v) is received by Lessor, after costs, from the exercise of its remedies under Section
15(a), Lessor shall promptly pay to Lessee any such excess.

(d) Lessee shall pay Lessor interest at a rate equal to the Overdue Rate on all sums not paid by Lessee to Lessor when due and owing under the provisions of this Agreement or any Schedule. Such interest shall be due and payable on demand by Lessor, or, if no demand is made, monthly on the same days as provided for the payment of Rent so long as payment of any monies due and payable hereunder is in arrears.

(e) All rights of Lessor are cumulative and not alternative and may be exercised by Lessor separately or together, in any order or combination. In addition to the rights of Lessor specifically set forth in this Agreement or any Schedule, Lessor

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shall be entitled to damages for breach of this Agreement or any Schedule, to an order requiring performance of the obligations of this Agreement or any Schedule, or to any other appropriate order or remedy available by contract, at law or in equity.

16. OWNERSHIP; PERSONAL PROPERTY; LABELS. As between Lessor and Lessee, title to the Products (other than any Licensed Materials) is and shall remain in Lessor; title to the Licensed Materials remains with the Licensor(s). During the relevant Lease Term, Products shall be and remain movable, personal and chattel property and Lessee agrees to take all action necessary or reasonably requested by Lessor to ensure that Products retain such status. Lessor shall not interfere with Lessee's right to possession and quiet enjoyment of Products during the relevant Lease Term, provided Lessee performs its obligations hereunder and under each Schedule pursuant to the terms and conditions hereunder and thereunder. Lessor may require plates, labels, or other markings to be affixed to or placed prominently upon Products (other than any Licensed Materials) indicating Lessor as the owner.

17. INDEMNIFICATION. LESSEE SHALL BE RESPONSIBLE FOR, AND SHALL INDEMNIFY, DEFEND AND HOLD LESSOR, LESSOR'S AFFILIATES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, REPRESENTATIVES AND AGENTS HARMLESS FROM AND AGAINST, ALL CLAIMS, DEMANDS, DAMAGES, LOSSES, LIABILITIES, ACTIONS, COSTS OR EXPENSES, INCLUDING ATTORNEYS' FEES (COLLECTIVELY, "CLAIMS"), ARISING FROM OR INCURRED IN CONNECTION WITH THIS AGREEMENT, ANY SCHEDULE, OR THE MANUFACTURE, ACQUISITION, POSSESSION, OWNERSHIP, USE, MAINTENANCE, CONDITION, RETURN OR OPERATION OF ANY PRODUCTS (INCLUDING (I) ANY PERSONAL INJURY OR DEATH, (II) ANY CLAIMS RELATED TO TAXES OR DUTIES, AND (III) ANY CLAIMS RELATED TO ANY SUBSEQUENT USE OR DISPOSITION BY LESSOR, LESSOR'S AFFILIATES OR ANY OF THEIR RESPECTIVE SUCCESSORS OR ASSIGNS OF ANY PRODUCTS THAT MAY CONTAIN ANY DATA OR OTHER MATERIALS OF LESSEE OR ANY THIRD PARTY). LESSEE SHALL BE OBLIGATED TO INDEMNIFY LESSOR AND ANY OTHER PERSON INDEMNIFIED HEREUNDER FOR ANY OF THE FOREGOING REGARDLESS OF THE FORM OF ACTION AND REGARDLESS OF WHETHER THE CLAIM IN QUESTION ARISES IN

PART FROM ANY NEGLIGENT ACT OR OMISSION OF ANY INDEMNIFIED PERSON, FROM STRICT

LIABILITY OF AN INDEMNIFIED PERSON, OR OTHERWISE, PROVIDED THAT THIS INDEMNITY SHALL NOT EXTEND TO ANY LOSS CAUSED SOLELY BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF LESSOR. LESSEE SHALL ASSUME THE DEFENSE OF SUCH CLAIM AT ITS EXPENSE, WITH COUNSEL OF ITS OWN CHOICE (SUCH COUNSEL BEING SUBJECT TO APPROVAL BY LESSOR, WHICH APPROVAL SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED) AND PAY ANY AMOUNT IN SETTLEMENT AND ALL COSTS AND DAMAGES AWARDED AGAINST OR INCURRED BY LESSOR OR ANY OTHER PERSON INDEMNIFIED HEREUNDER; PROVIDED, HOWEVER, THAT ANY PERSON INDEMNIFIED HEREUNDER SHALL HAVE THE RIGHT TO PARTICIPATE IN THE DEFENSE OF SUCH CLAIM WITH COUNSEL OF ITS CHOICE AND AT ITS EXPENSE AND TO APPROVE ANY SUCH SETTLEMENT (SUCH APPROVAL NOT TO BE UNREASONABLY WITHHELD OR DELAYED). LESSEE SHALL KEEP LESSOR INFORMED AT ALL TIMES AS TO THE STATUS OF LESSEE'S EFFORTS AND CONSULT WITH LESSOR CONCERNING ITS EFFORTS.

18. EXPORT ISSUES.

(a) Lessee shall not allow any Products to be transported or used outside of the United States of America without the prior written consent of Lessor. Lessee agrees that it shall not directly or indirectly export, reexport, transship, transfer, divert or otherwise dispose of any Products or technical information, even though otherwise permitted by this Agreement or by subsequent authorization from Lessor, except as shall be permitted by Applicable Laws. When requested by Lessor, Lessee shall give additional written assurances against any such export, reexport, transshipment, diversion or disposition.

(b) Lessor's obligation, if any, to lease and deliver Products and to provide or disclose any technical information shall be subject in all respects to the requirements of Applicable Laws, including such United States laws, regulations and orders as shall from time to time govern the lease and delivery of goods and the disclosure of technical information abroad by Persons subject to the jurisdiction of the United States.

19. LIENS, ENCUMBRANCES. Lessee shall, at Lessee's expense, keep Products free and clear of liens, security interests, attachments, seizures and encumbrances of any kind (except those arising hereunder or solely through the acts of Lessor) and shall immediately notify Lessor if any Person attempts to claim ownership of, a lien against, or any other interest in, or bring any legal process with respect to, any of the Products.

20. REMEDYING DEFAULTS. If Lessee shall fail to perform or comply with any of Lessee's obligations hereunder or under any Schedule, Lessor in its discretion may do all such reasonable acts and make all such reasonable disbursements as may be necessary to itself perform, or cause performance of or compliance with, such obligations, without the same constituting a waiver of such obligations or creating any obligation or liability on the part of Lessor either to remedy any other failure to perform or comply or to take any other action whatsoever, and any disbursements so made shall be payable by Lessee on demand, together with interest at the Overdue Rate from the date of disbursement by Lessor to the date of payment by Lessee.

21. NOTICES. Except as may be specifically provided herein, all notices with respect hereto shall be given in writing and shall be delivered (including delivery by courier, facsimile transmittal, telex or similar means) or sent by mail, postage prepaid, return receipt requested, addressed to the party for whom intended at the address specified on the first page of this Agreement or at such other

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address as the intended recipient previously shall have designated by at least 10 days written notice to the other party. Unless otherwise provided in this Agreement, notice shall be effective on the date that it is received or (if mailed as described above) 4 Business Days after the date of mailing.

22. ASSIGNMENT.

(a) Neither this Agreement, any Schedule, or any right or obligation hereunder or thereunder is assignable in whole or in part, whether by operation of law or otherwise, by Lessee without the prior written consent of Lessor, nor may Lessee assign or sublet Products without the prior written consent of Lessor. Any attempted assignment or subletting without Lessor's prior written consent shall be void and of no force and effect.

(b) Lessor may at any time without notice to Lessee, but subject to the rights of Lessee hereunder, transfer, assign, or grant a security interest in any Product, this Agreement, any Schedule, or any rights hereunder or thereunder (including any Rent or other monies and benefits due or to become due hereunder), in whole or in part. In such event, the assignee will have the rights and benefits, but not any of the obligations, of Lessor, and Lessee agrees that the rights of any such assignee will not be subject to any claims, defenses or setoffs that Lessee may have against Lessor.

(c) This Agreement shall be binding upon and inure to the benefit of Lessor and its successors and assigns and shall be binding upon Lessee and the heirs, executors, administrators, successors and permitted assigns and permitted sublessees of Lessee.

23. SURVIVAL. All of the representations, warranties, covenants and agreements of Lessee contained in this Agreement or any Schedule shall survive the termination of this Agreement and the expiration or earlier termination of any or all Schedule(s) until all obligations of Lessee under this Agreement and all Schedules have been performed in full; provided, however, that the provisions of Sections 11, 12, 13(b), 13(d), and 17 shall continue in full force and effect even after all obligations of Lessee have been performed in full.

24. GOVERNING LAW; JURISDICTION AND VENUE; WAIVER OF JURY TRIAL. THIS AGREEMENT AND EACH SCHEDULE SHALL BE GOVERNED IN ALL RESPECTS BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS, U.S.A. (EXCEPT AS OTHERWISE PROVIDED IN SECTION 27(k) REGARDING THE DETERMINATION OF THE MAXIMUM AMOUNT OF TIME PRICE BALANCE DIFFERENTIAL AND INTEREST), EXCLUSIVE OF ANY PROVISIONS OF THE UNITED NATIONS CONVENTION ON THE INTERNATIONAL SALE OF GOODS AND WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. REFERENCES TO THE UNIFORM COMMERCIAL CODE IN THIS AGREEMENT ARE TO THE UNIFORM COMMERCIAL CODE ADOPTED IN ILLINOIS AS 810 ILCS SECS. 5/1-101 ET SEQ. LESSEE IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY FEDERAL OR STATE COURT LOCATED IN COOK COUNTY, ILLINOIS, AND WAIVES TO THE FULLEST EXTENT ALLOWED BY LAW ANY OBJECTION TO VENUE IN SUCH COURT, AND FURTHER WAIVES ANY RIGHT TO A TRIAL BY JURY.

25. DEFINITIONS. In addition to the terms defined elsewhere in this Agreement, the following terms have the following respective meanings for purposes of this Agreement:

(a) Affiliate. Any Person that directly or indirectly controls, is controlled by, or is under common control with, Lessor or Lessee, as the context may require.

(b) Applicable Laws. All applicable laws, rules, regulations and orders of any government authority with jurisdiction over a party or over its performance in connection with this Agreement or any Schedule (including Lessee's lease or use of Products hereunder or thereunder).

(c) Business Day. Any day except Saturday, Sunday or a day on which banking institutions are required or authorized by law or other governmental action to be closed in Illinois.

(d) Documentation. All user guides, driver installation guides, listings, manuals, illustrations, and other written materials or publications that accompany or constitute all or a portion of any Software or other Products or that are provided by or on behalf of Lessor or any vendor or Licensor to Lessee relating to the installation, operation, sale, support or other use of any Software or other Products, and all modifications, additions, supplements, translations, derivative works and full or partial copies of any thereof, regardless of who prepared the same.

(e) Overdue Rate. A rate equal to the lesser of 1-1/2% per month or the highest rate permitted by applicable law.

(f) Person. Any individual, partnership, joint venture, corporation, limited liability company, trust, unincorporated organization, joint stock company, government or department or agency thereof, or other form of association or entity.

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(g) Products. All of the computer hardware, software, parts, equipment, accessories, and other products (including any Software or Documentation) that Lessor, in its sole discretion, may from time to time lease or offer for lease to Lessee under this Agreement, whether manufactured by Lessor or any other Person.

(h) Software. All software or computer programs that accompany or constitute all or a portion of any Products or are provided by or on behalf of Lessor or any vendor or Licensor to Lessee with respect to any Products, and all modifications, additions, supplements, translations, derivative works, and full or partial copies of any thereof, regardless of who prepared the same, and code with respect thereto, whether embodied in or contained on magnetic tape, disk, semiconductor device, or any other device or medium.

26. CONSTRUCTION. "This Lease Agreement," "Lease Agreement," "this Agreement," "hereto," "herein," "hereof," "hereby," "hereunder" and similar expressions refer to this Master Lease Agreement. The headings used in this Agreement are for convenience only and shall have no legal effect. Whenever the context requires, the gender of all words used herein shall include the masculine, the feminine and neuter, and the number of all words shall include the singular and plural. The term "including" as used in this Agreement means "including without limitation." Whenever reference is made in this Agreement to "days," the reference means calendar days, not Business Days, unless otherwise specified. This Agreement shall be interpreted fairly in accordance with its terms and without any strict construction in favor of or against either party.

27. MISCELLANEOUS.

(a) If more than one Person executes this Agreement or any Schedule as Lessee, their respective liabilities hereunder or thereunder shall be both joint and several, but Lessor shall be fully discharged in respect of any obligation hereunder upon performance of that obligation to any one of them.

(b) Failure of Lessor at any time to require Lessee's performance of any obligation shall not affect the right to require performance of that obligation. No term, condition or provision of this Agreement or any Schedule shall be waived or deemed to have been waived by Lessor unless it is in writing and signed by a duly authorized representative of Lessor. A valid waiver is limited to the specific situation for which it was given.

(c) Lessee shall furnish to Lessor such financial statements of Lessee and any Guarantor (prepared in accordance with generally accepted accounting principles consistently applied) and other information as Lessor may from time to time reasonably request. Lessee shall notify Lessor within 10 days after any material adverse change in Lessee's or any Guarantor's financial condition.

(d) Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement, or the application thereof to any Person or under any circumstances, shall be invalid or unenforceable to any extent under applicable law, and the extent of such invalidity or unenforceability does not destroy the basis for the bargain between the parties as expressed herein, then (i) such provision shall be deemed severed from this Agreement with respect to such party or such circumstance, without invalidating the remainder of this Agreement or the application of such provision to other Persons or circumstances, and (ii) a new provision shall be deemed substituted in lieu of the provision so severed which new provision shall, to the extent possible, accomplish the intent of the parties hereto as evidenced by the provision so severed.

(e) All Lessee's obligations hereunder shall be performed or observed at Lessee's expense.

(f) To the fullest extent permitted by applicable law, Lessee waives any and all rights and remedies conferred upon Lessee under Uniform Commercial Code Sections 2A-303 and 2A-508 through 2A-522.

(g) Lessee shall, upon Lessor's demand, promptly execute, acknowledge, deliver, file, register and record any and all further documents and take any and all other action reasonably requested by Lessor from time to time, for the purpose of fully effectuating the intent and purposes of this Agreement or any Schedule, and to protect the interests of Lessor, its successors and assigns. The parties intend for each lease to constitute a true lease of Products under the United Commercial Code and all Applicable Laws; if, however, any Lease is determined to be other than a true lease, Lessee grants to Lessor a security interest in the Products and all proceeds thereof. Lessee hereby appoints Lessor as Lessee's agent and attorney-in-fact to execute, deliver and file in the name of Lessee (and Lessee agrees to execute if requested) any financing statements or related filings as Lessor may reasonably deem necessary or appropriate. In addition, Lessor may file a copy of this Agreement in lieu of a financing statement.

(h) Lessee acknowledges receipt of a copy of this Agreement.

(i) This Agreement and each Schedule may be executed in any number of counterparts, each of which, when so executed and delivered, shall be an original (except as otherwise provided in the following sentence), but all such counterparts

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taken together shall constitute one and the same instrument. To the extent any Schedule constitutes chattel paper, no security interest in such Schedule may be perfected except by the possession of the manually executed counterpart of such Schedule identified in such Schedule as the original counterpart. If any Schedule is executed by Lessee and thereafter sent to Lessor by facsimile transmission, then until such time as Lessor has received such Schedule with Lessee's manual signature thereon, such facsimile transmission shall constitute, upon acceptance and execution by Lessor, the original Schedule and chattel paper and shall be admissible for all purposes as the original Schedule. In such event, Lessee agrees to promptly forward to Lessor the Schedule with Lessee's manual signature thereon and upon receipt by Lessor such Schedule with Lessee's manual signature thereon shall constitute the chattel paper in lieu of such facsimile transmission.

(j) This Agreement and each Schedule are non-cancellable by Lessee.

(k) Lessor and Lessee intend for each Lease to constitute a true lease of Products under the Uniform Commercial Code and all applicable law. If, however, any Lease is determined to be a lease intended as security, in no event shall Lessee, by acceleration or prepayment of the unpaid time price balance under the related Schedule or otherwise, be obligated to pay any time price balance differential in excess of the maximum amount permitted by applicable law (and for purposes of this Section the applicable law shall be the law of the state specified in Section 24 or the law of the state where the Products are located, whichever law permits the greater amount). Any acceleration or prepayment of the unpaid time price balance shall be subject to all applicable law, including rebates of unearned charges. If in any event whatsoever Lessor shall receive anything of value under a Lease deemed interest under applicable laws which would exceed the maximum amount of interest, the excess amount shall be applied to the reduction of the unpaid time price balance or shall be refunded to Lessee. All sums paid or agreed to be paid by Lessee to Lessor for the use, forbearance or detention of money shall, to the fullest extent permitted by applicable law, be amortized, prorated and allocated and spread throughout the full term of the applicable Schedule so that the amount of consideration constituting interest is uniform throughout the term of such Schedule and does not exceed the maximum permitted by applicable law. If any of the provisions of this paragraph conflict with any provision(s) of any other paragraph of this Agreement, any Schedule, or any provision(s) in any other agreement or course of dealing between Lessor and Lessee, the provisions of this paragraph shall control and govern the interpretation of this Agreement, such Schedule and any such other agreement or course of dealing.

(l) This Agreement and the Schedules hereto constitute the entire agreement between Lessor and Lessee and set forth the entire understanding and supersede and merge all prior written or oral communications, understandings, or agreements between the parties relating to the subject matter contained herein. The parties agree that use of preprinted forms (including orders, invoices and acknowledgments), other than the Schedules, is for convenience only and all terms and conditions stated therein, except for any information permitted by this Agreement, are void and of no effect. In the event of any conflict between this Agreement and the terms and conditions of any such document, this Agreement shall govern. This Agreement may be amended only in writing signed by Lessor (by a duly authorized representative) and Lessee. By initialing this provision, Lessee agrees to be bound by the terms of this Agreement and, to the extent applicable, that the provision concerning a separately signed document pursuant to Uniform Commercial Code Section 2A-208 has been compiled with.


Lessee's Initials

EXECUTED by the undersigned on the dates set forth below, to be effective as of the Effective Date.

DELL FINANCIAL SERVICES L.P.                  SAGENT TECHNOLOGY INC.
"LESSOR"                                      "LESSEE"


BY:                                           BY:     /s/ Kathleen Ovalle
   ----------------------------------            ------------------------------
NAME:                                         NAME:   Kathleen Ovalle
     --------------------------------              ----------------------------
TITLE:                                        TITLE:   Corporate Controller
      -------------------------------               ---------------------------
DATE:                                         DATE:    September 26, 1998
     --------------------------------              ----------------------------

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EXHIBIT 10.8


SAGENT TECHNOLOGY, INC.

LOAN AND SECURITY AGREEMENT



TABLE OF CONTENTS

                                                                                       PAGE

1.      DEFINITIONS AND CONSTRUCTION.....................................................1
        1.1    Definitions...............................................................1
        1.2    Accounting and Other Terms................................................8

2.      LOAN AND TERMS OF PAYMENT........................................................8
        2.1    Credit Extensions.........................................................8
        2.2    Overadvances.............................................................10
        2.3    Interest Rates, Payments, and Calculations...............................10
        2.4    Crediting Payments.......................................................10
        2.5    Fees.....................................................................11
        2.6    Additional Costs.........................................................11
        2.7    Term.....................................................................12

3.      CONDITIONS OF LOANS.............................................................12
        3.1    Conditions Precedent to Initial Credit Extension.........................12
        3.2    Conditions Precedent to all Credit Extensions............................12

4.      CREATION OF SECURITY INTEREST...................................................13
        4.1    Grant of Security Interest...............................................13
        4.2    Delivery of Additional Documentation Required............................13
        4.3    Right to Inspect.........................................................13

5.      REPRESENTATIONS AND WARRANTIES..................................................13
        5.1    Due Organization and Qualification.......................................13
        5.2    Due Authorization; No Conflict...........................................13
        5.3    No Prior Encumbrances....................................................13
        5.4    Bona Fide Eligible Accounts..............................................14
        5.5    Merchantable Inventory...................................................14
        5.6    Intellectual Property....................................................14
        5.7    Name; Location of Chief Executive Office.................................14
        5.8    Litigation...............................................................14
        5.9    No Material Adverse Change in Financial Statements.......................14
        5.10   Solvency.................................................................14
        5.11   Regulatory Compliance....................................................15
        5.12   Environmental Condition..................................................15
        5.13   Taxes....................................................................15
        5.14   Subsidiaries.............................................................15
        5.15   Government Consents......................................................15
        5.16   Full Disclosure..........................................................15

6.      AFFIRMATIVE COVENANTS...........................................................16
        6.1    Good Standing............................................................16
        6.2    Government Compliance....................................................16
        6.3    Financial Statements, Reports, Certificates..............................16
        6.4    Inventory; Returns.......................................................17
        6.5    Taxes....................................................................17
        6.6    Insurance................................................................17
        6.7    Principal Depository.....................................................17
        6.8    Quick Ratio, Cash Coverage Ratio or Cash Flow Coverage Ratio.............17
        6.9    Debt-Net Worth Ratio.....................................................18

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                                                                                       PAGE

        6.10   Tangible Net Worth.......................................................18
        6.11   Profitability............................................................18
        6.12   Further Assurances.......................................................18

7.      NEGATIVE COVENANTS..............................................................18
        7.1    Dispositions.............................................................18
        7.2    Changes in Business, Ownership, Management or Business Locations.........19
        7.3    Mergers or Acquisitions..................................................19
        7.4    Indebtedness.............................................................19
        7.5    Encumbrances.............................................................19
        7.6    Distributions............................................................19
        7.7    Investments..............................................................19
        7.8    Transactions with Affiliates.............................................19
        7.9    Intellectual Property Agreements.........................................19
        7.10   Subordinated Debt........................................................19
        7.11   Inventory................................................................20
        7.12   Compliance...............................................................20

8.      EVENTS OF DEFAULT...............................................................20
        8.1    Payment Default..........................................................20
        8.2    Covenant Default.........................................................20
        8.3    Material Adverse Change..................................................21
        8.4    Attachment...............................................................21
        8.5    Insolvency...............................................................21
        8.6    Other Agreements.........................................................21
        8.7    Subordinated Debt........................................................21
        8.8    Judgments................................................................21
        8.9    Misrepresentations.......................................................21

9.      BANK'S RIGHT'S AND REMEDIES.....................................................22
        9.1    Rights and Remedies......................................................22
        9.2    Power of Attorney........................................................23
        9.3    Accounts Collection......................................................23
        9.4    Bank Expenses............................................................23
        9.5    Bank's Liability for Collateral..........................................24
        9.6    Remedies Cumulative......................................................24
        9.7    Demand; Protest..........................................................24

10.     NOTICES.........................................................................24

11.     CHOICE OF LAW AND VENUE.........................................................25

12.     GENERAL PROVISIONS..............................................................25
        12.1   Successors and Assigns...................................................25
        12.2   Indemnification..........................................................25
        12.3   Time of Essence..........................................................25
        12.4   Severability of Provisions...............................................26
        12.5   Amendments in Writing, Integration.......................................26
        12.6   Counterparts.............................................................26
        12.7   Survival.................................................................26

ii

This LOAN AND SECURITY AGREEMENT is entered into as of July 16,1997, by and between VENTURE BANKING GROUP, a division of Cupertino National Bank ("Bank") and SAGENT TECHNOLOGY, INC. ("Borrower").

RECITALS

Borrower wishes to obtain credit from time to time from Bank, and Bank desires to extend credit to Borrower. This Agreement sets forth the terms on which Bank will advance credit to Borrower, and Borrower will repay the amounts owing to Bank.

AGREEMENT

The parties agree as follows:

1. DEFINITIONS AND CONSTRUCTION

1.1 Definitions.

As used in this Agreement, the following terms shall have the following definitions:

"Accounts" means all presently existing and hereafter arising accounts, contract rights, and all other forms of obligations owing to Borrower arising out of the sale or lease of goods (including, without limitation, the licensing of software and other technology) or the rendering of services by Borrower, whether or not earned by performance, and any and all credit insurance, guaranties, and other security therefor, as well as all merchandise returned to or reclaimed by Borrower and Borrower's Books relating to any of the foregoing.

"Advance" or "Advances" means a loan advance under the Committed Revolving Line.

"Affiliate" means, with respect to any Person, any Person that owns or controls directly or indirectly such Person, any Person that controls or is controlled by or is under common control with such Person, and each of such Person's senior executive officers, directors, partners and, for any Person that is a limited liability company, such Persons, managers and members.

"Bank Expenses" means all: reasonable costs or expenses (including reasonable attorneys' fees and expenses) incurred in connection with the preparation, negotiation, administration, and enforcement of the Loan Documents; and Bank's reasonable attorneys' fees and expenses incurred in amending, enforcing or defending the Loan Documents (including fees and expenses of appeal or review, or those incurred in any Insolvency Proceeding), whether or not suit is brought.

"Borrower's Books" means all of Borrower's books and records including without limitation: ledgers; records concerning Borrower's assets or liabilities, the Collateral, business operations or financial condition; and all computer programs, or tape files, and the equipment, containing such information.

"Borrowing Base" means an amount equal to (i) eighty percent (80%) of Eligible Accounts plus (ii) fifty percent (50%) of Eligible Foreign Accounts, as determined by Bank with reference to the most recent Borrowing Base Certificate delivered by Borrower.

1

"Business Day" means any day that is not a Saturday, Sunday, or other day on which banks in the State of California are authorized or required to close.

"Closing Date" means the date of this Agreement.

"Code" means the California Uniform Commercial Code.

"Collateral" means the property described on Exhibit A attached hereto.

"Committed Revolving Line" means a credit extension of up to Two Million Dollars ($2,000,000).

"Committed Equipment Line means a credit extension of up to One Million Dollars ($1,000,000).

"Contingent Obligation" means, as applied to any Person, any direct or indirect liability, contingent or otherwise, of that Person with respect to (i) any indebtedness, lease, dividend, letter of credit or other obligation of another, including, without limitation, any such obligation directly or indirectly guaranteed, endorsed, co-made or discounted or sold with recourse by that Person, or in respect of which that Person is otherwise directly or indirectly liable; (H) any obligations with respect to undrawn letters of credit issued for the account of that Person; and (W) all obligations arising under any interest rate, currency or commodity swap agreement, interest rate cap agreement, interest rate collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices; provided, however, that the term "Contingent Obligation" shall not include endorsements for collection or deposit in the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determined amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith; provided, however, that such amount shall not in any event exceed the maximum amount of the obligations under the guarantee or other support arrangement.

"Copyrights" means any and all copyright rights, copyright applications, copyright registrations and like protections in each work or authorship and derivative work thereof, whether published or unpublished and whether or not the same also constitutes a trade secret, now or hereafter existing, created, acquired or held.

"Credit Extension" means each Advance, Equipment Advance, Letter of Credit, Term Loan, Exchange Contract or any other extension of credit by Bank for the benefit of Borrower hereunder.

"Current Assets" means, as of any applicable date, all amounts that should, in accordance with GAAP, be included as current assets on the consolidated balance sheet of Borrower and its Subsidiaries as at such date.

"Current Liabilities" means, as of any applicable date, all amounts that should, in accordance with GAAP, be included as current liabilities on the consolidated balance sheet of Borrower and its Subsidiaries, as at such date, plus, to the extent not already included therein, all outstanding Credit Extensions made under this Agreement, including all Indebtedness that is payable upon demand or within one year from the date of determination thereof unless such Indebtedness is renewable or extendable at the option of Borrower or any Subsidiary to a date more than one year from the date of determination, but excluding Subordinated Debt.

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"Eligible Accounts" means those Accounts that arise in the ordinary course of Borrower's business that comply with all of Borrower's representations and warranties to Bank set forth in Section 5.4; provided that standards of eligibility may be fixed and revised from time to time by Bank in Bank's reasonable judgment and upon notification thereof to Borrower in accordance with the provisions hereof. Unless otherwise agreed to by Bank in writing, Eligible Accounts shall not include -the following:

(a) Accounts that the account debtor has failed to pay within ninety (90) days of invoice date;

(b) Accounts with respect to an account debtor, fifty percent (50%) of whose Accounts the account debtor has failed to pay within ninety (90) days of invoice date;

(c) Accounts with respect to an account debtor, including Affiliates, whose total obligations to Borrower exceed forty percent (40%) of all Accounts, except with respect to Fortune 500 Companies, as to which the percentage shall be sixty-five percent (65%) to the extent such obligations exceed the aforementioned percentage, except as approved in writing by Bank;

(d) Accounts with respect to which the account debtor does not have its principal place of business in the United States;

(e) Accounts with respect to which the account debtor is a federal, state or local governmental entity or any department, agency, or instrumentality thereof;

(f) Accounts with respect to which Borrower is liable to the account debtor, but only to the extent of any amounts owing to the account debtor (sometimes referred to as "contra" accounts, e.g. accounts payable, customer deposits, credit accounts, etc.);

(g) Accounts generated by demonstration or promotional equipment, or with respect to which goods are placed on consignment, guaranteed sale, sale or return, sale on approval, bill and hold, or other terms by reason of which the payment by the account debtor may be conditional;

(h) Accounts with respect to which the account debtor is an Affiliate, officer, employee, or agent of Borrower;

(i) Accounts with respect to which the account debtor disputes liability or makes any claim with respect thereto as to which Bank believes, in its sole discretion, that there may be a basis for dispute (but only to the extent of the amount subject to such dispute or claim), or is subject to any Insolvency Proceeding, or becomes insolvent, or goes out of business;

(j) Accounts owing from distributors that have not been pre-approved in writing by Bank; and

(k) Accounts with respect to progress billings;

(l) Accounts the collection of which Bank reasonably determines to be doubtful. "Eligible Foreign Accounts" means Accounts with respect to which the account debtor does not have its principal place of business in the United States and that are: (1) covered by credit insurance in form and amount, and by an insurer satisfactory to Bank less the amount of any deductible(s) which may be or become owing thereon; or (2) supported by one or more letters of credit either advised or negotiated through Bank or in favor of Bank as beneficiary, in an amount and of a

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tenor, and issued by a financial institution, acceptable to Bank; or (3) that Bank approves on a case-by-case basis.

"Equipment" means all present and future machinery, equipment, tenant improvements, furniture, fixtures, vehicles, tools, parts and attachments in which Borrower has any interest.

"Equipment Advance" has the meaning set forth in Section 2.1.3.

"Equipment Availability Date" has the meaning set forth in Section 2.1.3.

"ERISA" means the Employment Retirement Income Security Act of 1974, as amended, and the regulations thereunder.

"Fortune 500 Companies" mean any account debtor of Borrower listed among the 500 largest United States companies in the most recent such listing published by Fortune Magazine.

"GAAP" means generally accepted accounting principles as in effect in the United States from time to time.

"Indebtedness" means (a) all indebtedness for borrowed money or the deferred purchase price of property or services, including without limitation reimbursement and other obligations with respect to surety bonds and letters of credit, (b) all obligations evidenced by notes, bonds, debentures or similar instruments, (c) all capital lease obligations and (d) all Contingent Obligations.

"Insolvency Proceeding" means any proceeding commenced by or against any person or entity under any provision of the United States Bankruptcy Code, as amended, or under any other bankruptcy or insolvency law, including assignments for the benefit of creditors, formal or informal moratoria, compositions, extension generally with its creditors, or proceedings seeking reorganization, arrangement, or other relief.

"Intellectual Property Collateral" means

(a) Copyrights, Trademarks, Patents, and Mask Works;

(b) Any and all trade secrets, and any and all intellectual property rights in computer software and computer software products now or hereafter existing, created, acquired or held;

(c) Any and all design rights which may be available to Borrower now or hereafter existing, created, acquired or held;

(d) Any and all claims for damages by way of past, present and future infringement of any of the rights included above, with the right, but not the obligation, to sue for and collect such damages for said use or infringement of the intellectual property rights identified above;

(e) All licenses or other rights to use any of the Copyrights, Patents, Trademarks, or Mask Works, and all license fees and royalties arising from such use to the extent permitted by such license or rights;

(f) All amendments, renewals and extensions of any of the Copyrights, Trademarks, Patents or Mask Works; and

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(g) All proceeds and products of the foregoing, including without limitation all payments under-insurance or any indemnity or warranty payable in respect of any of the foregoing.

"Inventory" means all present and future inventory in which Borrower has any interest, including merchandise, raw materials, parts, supplies, packing and shipping materials, work in process and finished products intended for sale or lease or to be furnished under a contract of service, of every kind and description now or at any time hereafter owned by or in the custody or possession, actual or constructive, of Borrower, including such inventory as is temporarily out of its custody or possession or in transit and including any returns upon any accounts or other proceeds, including insurance proceeds, resulting from the sale or disposition of any of the foregoing and any documents of title representing any of the above.

"Investment" means any beneficial ownership of (including stock, partnership interest or other securities) any Person, or any loan, advance or capital contribution to any Person.

"IRC" means the Internal Revenue Code of 1986, as amended, and the regulations thereunder.

"Letter of Credit" means a letter of credit or similar undertaking issued by Bank pursuant to Section 2.1-2, and any letters of credit previously issued by Bank for the account of Borrower and existing on the Closing Date, including Letter of Credit #10356.

"Letter of Credit Reserve" has the meaning set forth in
Section 2.1.2.

"Lien" means any mortgage, lien, deed of trust, charge, pledge, security interest or other encumbrance.

"Loan Documents" means, collectively, this Agreement, any note or notes executed by Borrower, and any other present or future agreement entered into between Borrower and./or for the benefit of Bank in connection with this Agreement, all as amended, extended or restated from time to time.

"Mask Works" means all mask works or similar rights available for the protection of semiconductor chips, now owned or hereafter acquired.

"Material Adverse Effect" means a material adverse effect on (i) the business operations or condition (financial or otherwise) of Borrower and its Subsidiaries taken as a whole or (ii) the ability of Borrower to repay the Obligations or otherwise perform its obligations under the Loan Documents.

"Maturity Date" means July 15, 2001.

"Negotiable Collateral" means all of Borrower's present and future letters of credit of which it is a beneficiary, notes, drafts, instruments, securities, documents of title, and chattel paper.

"Obligations" means all debt, principal, interest, Bank Expenses and other amounts owed to Bank by Borrower pursuant to this Agreement or any other agreement, whether absolute or contingent, due or to become due, now existing or hereafter arising, including any interest that accrues after the commencement of an Insolvency Proceeding and including any debt, liability, or obligation owing from Borrower to others that Bank may have obtained by assignment or otherwise.

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"Patents" means all patents, patent applications and like protections, including without limitation improvements, divisions, continuations, renewals, reissues, extensions and continuations-in-part of the same.

"Payment Date" means the fifteenth (15th) calendar day of each month, commencing on the first such date after the Closing Date and ending on the Maturity Date.

"Permitted Indebtedness" means:

(a) Indebtedness of Borrower in favor of Bank arising under this Agreement or any other Loan Document;

(b) Indebtedness existing on the Closing Date and disclosed in the Schedule;

(c) Subordinated Debt;

(d) Indebtedness to trade creditors incurred in the ordinary course of business; and

(e) Indebtedness secured by Permitted Liens.

"Permitted Investment" means:

(a) Investments existing on the Closing Date disclosed in the Schedule; and

(b) (i) marketable direct obligations issued or unconditionally guaranteed by the United States of America or any agency or any State thereof maturing within one (1) year from the date of acquisition thereof,
(ii) commercial paper maturing no more than one (1) year from the date of creation thereof and currently having the highest rating obtainable from either Standard & Poor's Corporation or Moody's Investors Service, Inc., and (iii) certificates of deposit maturing no more than one (1) year from the date of investment therein issued by Bank.

"Permitted Liens" means the following:

(a) Any Liens existing on the Closing Date and disclosed in the Schedule or arising under this Agreement or the other Loan Documents;

(b) Liens for taxes, fees, assessments or other governmental charges or levies,. either not delinquent or being contested in good faith by appropriate proceedings and as to which adequate reserves are maintained on Borrower's Books in accordance with GAAP, provided the same have no priority over any of Bank's security interests;

(c) Liens (i) upon or in any Equipment acquired or held by Borrower or any of its Subsidiaries to secure the purchase price of such Equipment or indebtedness incurred solely for the purpose of financing the acquisition of such Equipment, or (ii) existing on such equipment at the time of its acquisition, provided that the Lien is confined solely to the property so acquired and improvements thereon, and the proceeds of such equipment;

(d) Leases or subleases and licenses or sublicenses granted to others in the ordinary course of Borrower's business not interfering in any material respect with the business of Borrower and its Subsidiaries taken as a whole, and any interest or title of a lessor, licensor or under

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any lease or license, provided that such leases, subleases, licenses and sublicenses do not prohibit the grant of the security interest granted hereunder; and

(e) Liens incurred in connection with the extension, renewal or refinancing of the indebtedness secured by Liens of the type described in clauses (a) through (c) above, provided that any extension, renewal or replacement Lien shall be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness being extended, renewed or refinanced does not increase.

"Person" means any individual, sole proprietorship, partnership, limited liability company, joint venture, trust, unincorporated organization, association, corporation, institution, public benefit corporation, firm, joint stock company, estate, entity or governmental agency.

"Prime Rate" means the variable rate of interest, per annum, most recently published in the Western edition of The Wall Street Journal, as the "prime rate," whether or not such rate is the lowest rate available from Bank.

"Quick Assets" means, as of any applicable date, the consolidated cash, cash equivalents, accounts receivable and investments with maturities of fewer than ninety (90) days of Borrower determined in accordance with GAAP.

"Responsible Officer" means each of the Chief Executive Officer, the President, the Chief Financial Officer and the Controller of Borrower.

"Revolving Maturity Date" means the date immediately preceding the first anniversary of the Closing Date.

"Schedule" means the schedule of exceptions attached hereto, if any.

"Subordinated Debt" means any debt incurred by Borrower that is subordinated to the debt owing by Borrower to Bank on terms acceptable to Bank (and identified as being such by Borrower and Bank).

"Subsidiary" means with respect to any Person, any corporation, partnership, company association, joint venture, or any other business entity, if any, of which more than fifty percent (50%) of the voting stock or other equity interests is owned or controlled, directly or indirectly, by such Person or one or more Affiliates of such Person.

"Tangible Net Worth" means, as of any applicable date, the consolidated total assets of Borrower and its Subsidiaries minus without duplication, (i) the sum of any amounts attributable to (a) goodwill, (b) intangible items such as unamortized debt discount and expense, patents, trade and service marks and names, copyrights and research and development expenses except prepaid expenses, and (c) all reserves not already deducted from assets, and (ii) Total Liabilities.

"Total Liabilities" means, as of any applicable date, all obligations that should, in accordance with GAAP, be classified as liabilities on the consolidated balance sheet of Borrower, including in any event all Indebtedness, but specifically excluding Subordinated Debt.

"Trademarks" means any trademark and servicemark rights, whether registered or not, applications to register and registrations of the same and like protections, and the entire goodwill of the business of Borrower connected with and symbolized by such trademarks.

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1.2 Accounting and Other Terms.

All accounting terms not specifically defined herein shall be construed in accordance with GAAP and all calculations and determinations made hereunder shall be made in accordance with GAAP. When used herein, the term "financial statements" shall include the notes and schedules thereto. The terms "including" / "includes" shall always be read as meaning "including (or includes) without limitation," when used herein or in any other Loan Document.

2. LOAN AND TERMS OF PAYMENT

2.1 Credit Extensions.

Borrower promises to pay when due to the order of Bank, in lawful money of the United States of America, the aggregate unpaid principal amount of all Credit Extensions made by Bank to Borrower hereunder. Borrower shall also pay interest on the unpaid principal amount of such Credit Extensions at rates in accordance with the terms hereof.

2.1.1