Revenue 

        Total revenue decreased by 23% to $8.8 million for the three months ended September 30, 2002 from $11.4 million for the corresponding period in 2001. For the nine months ended September 30, 2002, total revenue decreased by 14% to $29.3 million from $34.3 million for the corresponding period in 2001. The slowing global economy resulted in continued lengthening of the enterprise sales cycle and deferral of information technology (IT) spending further contributed to the lower license and professional services revenue. 

        License revenue declined by 22% to $4.5 million for the three months ended September 30, 2002 from $5.9 million for the corresponding period in 2001. For the nine months ended September 30, 2002, license revenue declined by 11% to $15.4 million from $17.3 million for the corresponding period in 2001.The decline was mainly attributed to a reduction in the number and size of the deals closed during the three and nine months periods ended September 30, 2002. Uncertainty in global economic conditions continues to make it difficult to predict our product demand. We expect seasonal trends to continue throughout the next few quarters, and license revenue will remain flat or grow modestly. Sagent had a restructuring during the three months period ended September 30, 2002, and as part of this restructuring, there were management changes at the executive level and sales force turnover. This reorganization impacted the performance of our sales force in the United States and Asia Pacific during the three months ended September 30, 2002, and delayed the closure of several transactions. In any quarter, a few large license transactions at the end of the quarter may account for a substantial amount of our license revenue. If a customer or potential customer cancels or does not enter into an anticipated large transaction, or delays the transaction beyond the end of the quarter, our financial results may be materially adversely affected. 

        Service revenue declined by 24% to $4.3 million for the three months ended September 30, 2002 from $5.6 million for the corresponding period in 2001. For the nine months ended September 30, 2002, service revenue declined by 18% to $13.9 million from $16.9 million for the corresponding period in 2001. 

        Maintenance revenue increased by 3% to $2.8 million for the three months ended September 30, 2002 from $2.7 million for the corresponding period in 2001. For the nine months ended September 30, 2002, maintenance revenue increased by 11% to $8.6 million from $7.7 million for the corresponding period in 2001.The increases of $0.01 and $0.9 million in maintenance revenue during the three and nine months periods ending September 30, 2002, respectively, were primarily due to new licenses and an increased effort to renew the maintenance agreements within our existing customer base.

        Professional services declined by 49% to $1.5 million for the three months ended September 30, 2002 from $2.9 million for the corresponding period in 2001. For the nine months ended September 30, 2002, professional services declined 43% to $5.3 million from $9.2 million for the corresponding period in 2001. Decreases in professional services revenue of $1.4 million and $3.9 million for the three and nine months periods ending September 30, 2002, respectively, were due to declines in consulting and training services attributed to a slowdown in the economy and a decline in new license revenue in previous quarters. Sagent had a restructuring during the period ended September 30, 2002, as part of this restructuring, we reduced the headcount of professional services by 15. This reduction in headcount will improve the productivity and gross margin in the long run; however, it also causes a decline in the professional services revenue.

        A significant portion of our revenue is generated outside the United States. Our international revenue was 36% of total revenue or $3.1 million and 32% or $3.7 million for the three months ended September 30, 2002 and 2001, respectively, representing a decline of $0.5 million or 14%. The decline in international revenue during the three months ended September 30, 2002 was mainly attributable to restructuring efforts in our subsidiaries including a reduction in their headcounts from 85 to 72 and the decision to close our Sagent Brazil office. For the nine months ended September 30, 2002, our international revenue was 37% of total revenue or $11.0 million and 27% or $9.2 million for the corresponding period in 2001, representing an increase of $1.7 million or 19%. This increase is attributed mainly to expansion of our international operations as well as stronger overseas market demand for our products. A significant portion of our total revenue is currently derived from international sales and therefore subject to its related risks, including general economic conditions in each country, the strength of international competitors, different tax structures, difficulty of managing an organization spread over various countries, changes in regulatory requirements, compliance with a variety of foreign laws and regulations, longer payment cycles, and the volatility of exchange rates in certain countries. A significant portion of our business is conducted in currencies other than the U.S. dollar and the effect of exchange rates on our total revenues was immaterial during the three and nine months periods ended September 30, 2002 and 2001. Foreign exchange rates will continue to affect our total revenue and results of operations depending on the U.S. dollar strengthening or weakening relative to foreign currencies. Unfavorable changes in each country's general economic and political environment or foreign exchange rates may have a material adverse impact on our total revenue and results of operations. 

    Cost of Revenue 

        Cost of revenue from license sales consists primarily of royalties, product packaging, shipping, media, and documentation. Our cost of revenue for license sales was $0.3 million and $1.6 million, representing 7% and 27% of license revenue, for the three months ended September 30, 2002 and 2001, respectively. Our cost of revenue for license sales was $1.4 million and $3.3 million, representing 9% and 19% of license revenue, for the nine months ended September 30, 2002 and 2001, respectively. Our cost of license revenue decreased over the same period of the prior year as a result of discontinuation of providing product documentation in a hard copy format thereby reducing the applicable costs by $0.2 million and $0.9 million for the three and nine months periods ended September 30, 2002 and 2001, respectively. We have been providing our customers with soft copy online documentation effective January 1, 2002. The cost of licensed technology decreased by $0.8 million and $1.2 million for the three and nine months periods ended September 30, 2002 and 2001, respectively. The decline in the cost of licensed technology is due to the impairment of our obsolete technology licenses in the previous quarters that we no longer intended to use. 

        Cost of service consists primarily of personnel costs associated with providing software maintenance, technical support, training and consulting services. Our cost of service revenue declined by 31% to $1.7 million, representing 41% of service revenue, for the three months period ended September 30, 2002 from $2.5 million, representing 45% of service revenue, for the corresponding period in 2001. Our cost of service revenue declined by 29% to $6.1 million, representing 44% of service revenue, for the nine months ended September 30, 2002 from $8.5 million, representing 50% of service revenue, for the corresponding period in 2001. The decline was mainly attributed to the outsourcing of marketing services during the period ended September 30, 2002, and a reduction in salary related expenditures of $0.6 million for the three months ended September 30, 2002 due to a reduction in headcount from 42 to 25, and $2.4 million for the nine months ended September 30, 2002 due t o a headcount reduction from 46 to 25. 

        Further, during the three months ended June 30, 2002, we recorded an impairment charge of $1.2 million related to purchased technology that we no longer expect to utilize in the future. 

    Gross Margin 

        Gross margins increased to 77% for the three months ended September 30, 2002 from 64% for the corresponding period in 2001. For the nine months period ended September 30, 2002, the gross margin increased to 70% from 65% for the corresponding period in 2001. The increase was mainly due to improved gross margins for both license and service sales, as discussed in previous paragraphs, and partially due the mix of revenue and a higher percentage of license revenue to services revenue. 

        Our service revenues have a substantially lower margin than our product license revenues, and an increase in service revenues relative to license revenues could harm our gross margins. 

    Sales and Marketing 

        Sales and marketing expenses consist primarily of compensation, travel, marketing programs, and branch facilities. Sales and marketing expenses decreased 42% to $5.8 million for the three months ended September 30, 2002 from $10.1 million for the corresponding period in 2001. For the nine months ended September 30, 2002, sales and marketing expenses decreased by 29% to $20.0 million from $28.3 million for the corresponding period in 2001. Sales and marketing expenses represent 66% and 88% of total net revenue for the three months ended September 30, 2002 and 2001, respectively, and 68% and 83% of total net revenue for the nine months ended September 30, 2002 and 2001, respectively. For the three months ended September 30, 2002, the decline of $4.3 million is primarily attributable to $2.6 million decrease in salary related expenses due to a reduction in headcount from 131 to 97, a decrease in marketing related programs for $0.4 million, and a decrease in travel related expenditures of $0.3 million. For the nine months ended September 30, 2002, the decline of $8.3 million is primarily attributable to a decrease in salary related expenses of $4.3 million due to a reduction in headcount from 169 to 97, and a decrease in marketing related programs of $1.0 million, and a decrease in travel related expenditures of $0.6 million. 

    Research and Development 

        Research and development expenses consist primarily of personnel and related costs associated with the development of new products, enhancement and localization of existing products, quality assurance testing, and facilities. Research and development expenses decreased by $0.7 million to $2.6 million for the three months period ended September 30, 2002 from $3.3 million for the corresponding period in 2001. For the nine months ended September 30, 2002, research and development expenses declined by $1.4 million to $9.3 million from $10.7 million for the corresponding period in 2001. Research and development expenses represent 29% of total net revenue for the three months ended September 30, 2002 and 2001, and 32% and 31% of total net revenue for the nine months ended September 30, 2002 and 2001, respectively. The decline of $0.7 million and $1.4 million during the three and nine months periods ending September 30, 2002, respectively, is mainly attributable to a reduction in salary and employee related costs due to a reduction in headcount from 61 to 45 for the three months and from 64 to 45 for the nine months periods ended September 30, 2002, and other cost cutting measures that took effect during such periods. 

    General and Administrative 

        General and administrative expenses consist primarily of personnel costs for finance, human resources, information systems and general management, as well as legal, accounting and bad debt expenses. General and administrative expenses decreased by $2.5 million to $1.4 million for the three months ended September 30, 2002 from $3.9 million for the corresponding period in 2001. For the nine months ended September 30, 2002, general and administrative expenses decreased by $5.4 million to $4.0 million from $9.4 million for the corresponding period in 2001. General and administrative expenses represent 16% and 34% of total net revenue for the three months ended September 30, 2002 and 2001, respectively, and 13% and 27% of total net revenue for the nine months ended September 30, 2002 and 2001, respectively. For the three months ended September 30, 2002, the decline of $2.5 million is primarily due to a reduction of $1.5 million in bad debt expense, $0.3 million reduction in facility related costs, and $0.5 million decrease in personnel and related costs due to a reduction in headcount from 24 to 17. For the nine months ended September 30, 2002, the decline of $5.4 million is primarily due to a reduction of $1.6 million in bad debt expense, $0.9 million reduction in facility related costs, and a $1.3 million decline in personnel and related costs due to a reduction in headcount from 31 to 17. 

    Asset Impairments 

        For the three and nine months ended September 30, 2002, Sagent incurred asset impairment charges of $1.0 million, consisted of $0.7 million impairment in goodwill and $0.3 million reserve on shareholders' notes due to decline in fair market value. For the three and nine months ended September 30, 2001, the asset impairment charge of $1.6 million consisted of $0.3 million reduction in the carrying value of goodwill, $1.2 million impairment of prepayments for data center services, and $0.1 million of other losses related to the closing of a remote facility. 

    Restructuring Costs

        In December 2001, Sagent implemented a restructuring plan aimed at streamlining the underlying cost structure to better position Sagent for growth and improved operating results. As part of the restructuring plan, Sagent consolidated the Florida facility and implemented a reduction in workforce of approximately 14% or 51 employees and contractors through March 31, 2002. During the second quarter of 2002, Sagent implemented a new restructuring plan to be executed during the three months ended September 30, 2002. The major element of the restructuring plan was to terminate certain employees; as a result, Sagent had a reduction in force by approximately 29% or 74 employees, which brought Sagent's total headcount to 184 worldwide. The reduction came from all areas of the Company, and the terminations were completed by September 30, 2002. Sagent's Chief Executive Officer and President and its Executive Vice President and Chief Marketing Officer stepped down as part of this restructuring. Further, Sagent decided to proceed with closing its Brazil office and discontinuation of its marketing services due to the changes in the strategy of the Company. The purpose of the restructuring was to bring operating expenses in line with net revenues with the goal of achieving cash flow breakeven in the near future and strategically focusing the Company on its core business. We incurred $4.9 million in restructuring and related charges for the nine months ended September 30, 2002, consisting primarily of personnel and facility related costs. Sagent paid $1.3 million for the period ended September 30, 2002, $1.5 million will be paid in the next four quarters, and the remaining $2.1 million consisting of non-cash charges was primarily related to $1.2 million from forgiveness and impairment of loans to executive and $0.9 million in stock compensation from the acceleration of vesting for certain terminated executive. As part of this restructuring, Sagent reduced its total headcount worldwide to 177, as of October 31, 2002.
 

LIQUIDITY AND CAPITAL RESOURCES 

        As of September 30, 2002, Sagent's principal source of liquidity consisted of $5.2 million of cash and cash equivalents and $0.8 million restricted cash in the form of a money market account and certificate of deposit. Since inception, we have funded our operations partially through private sales of equity securities, the use of equipment leases and the initial public offering of our common stock in April 1999. 

        Net cash used in operating activities for the nine months ended September 30, 2002 was $8.2 million, which primarily funded our ongoing operations. 

       Net cash provided by investing activities was $0.3 million, which primarily was due to the collection of notes due from shareholders of $0.4 million, offset by $0.1 million in fixed asset purchases. 

        Net cash used in financing activities was $1.8 million, which primarily funded the payment of our capital lease obligations. 

       Accounts receivable decreased by 41% as of September 30, 2002 compared with December 31, 2001 balance. The decrease was due primarily to lower sales revenue. The Days Sales Outstanding (DSO) was at 110 as of September 30, 2002 compared with 106 for the corresponding period in 2001. Sagent calculates its DSO on a "net" basis by dividing the average accounts receivable at the beginning and the end of the quarter by the revenue recognized net of changes in deferred revenue for the quarter multiplied by the number of days during that quarter. 

        The following is a summary of our future minimum payments under contractual obligations as of September 30, 2002: 

        Sagent has entered into several agreements to finance computer equipment leases. Sagent financed the acquisition of property and equipment, primarily computer hardware and software, and leasehold improvements and furniture totaling $0.1 million and $4.0 million as of September 30, 2002 and December 31, 2001, respectively, through capital leases. Sagent has also entered into several agreements to lease facilities in California and several other states as well as in other countries in which it has sales operations. Sagent is also under obligation to pay certain maintenance fees to third party vendors. 

        Purchase obligations relate to Sagent's future commitments for technology and a data renewal contract. 

        Restructuring consists of primarily personnel and facility related costs. The purpose of the restructuring was to bring operating expenses in line with net revenues with the goal of achieving cash flow breakeven in the near future and strategically focusing the Company on its core business as discussed in Note 6.

        Our ability to grow sales and manage our expenses will have a direct impact on our liquidity and capital resources. Factors that are reasonably likely to impact our ability to maintain or grow Sagent's revenue, are as follows: 

• general economic conditions and the information technology spending environment;
• the growth or contraction of the enterprise intelligence software market;
• competition from other participants in the enterprise intelligence software market;
• our ability to expand our direct and indirect sales channels;
• our ability to maintain and expand our marketing, technology and distribution relationships;
• our access to licensed technologies integrated in our products and services
• market acceptance of Internet solutions;
• our ability to manage our international expansion;
• our ability to protect our intellectual property rights; and
• our ability to anticipate and respond to technological change.

        We believe that our existing cash balances, including the proceeds from the loan referred to in Note 9 to the financial statements above, and any cash provided by operations will be sufficient to meet our operating requirements for the next twelve months. Thereafter, we may require additional funds to support our operating requirements and may seek, even before such time, to raise additional funds through public or private equity financing, debt financing or other sources. There can be no assurance that additional financing will be available at all, or that if available, such financing will be obtained on terms favorable to us and would not result in additional dilution to our stockholders. If we are unable to raise additional capital, we will take actions to conserve our cash balances, including significantly reducing our operating expenses, downsizing our staff and closing existing branch offices, all of which could have a material adverse effect on our financial condition and our ability to reduce losses or generate profits. 

RECENT ACCOUNTING PRONOUNCEMENTS 

        In July 2002, the Financial Accounting Standard Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No. 146, "Accounting for Costs Associated with Exit or Disposal Activities." SFAS No. 146 requires that a liability for a cost associated with an exit or disposal activity should be recorded when it is incurred, meeting the definition of a liability in FASB Concepts Statement No. 6, " Elements of Financial Statements", and when its fair value can be measured. SFAS 146 supersedes FASB's Emergency Issues Task Force (EITF ) Issue No. 94-3, "Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred in a Restructuring." The Statement is effective for exit or disposal activities that are initiated after December 31, 2002. We do not expect the adoption of SFAS No. 146 to have a material effect on our consolidated results of operations or financial position. 


RISK FACTORS THAT MAY AFFECT FUTURE RESULTS 

        Any investment in our common stock involves a high degree of risk. You should consider carefully the following information about risks, together with the other information contained in this report, before you decide whether to buy our common stock or maintain your investment. Additional risks and uncertainties not known to us or that we now believe to be unimportant could also impair our business. If any of the following risks actually occur, our business, results of operations and financial condition could suffer significantly. As a result, the market price of our common stock could decline, and you may lose all of your investment. 

    Our workforce reduction and financial performance may adversely affect the morale and performance of our personnel and our ability to hire new employees. 

        In connection with our effort to streamline operations, increase revenues, reduce costs and bring our staffing and structure in line with our current and anticipated requirements, we recently realigned our business organization, which included a 29% reduction in workforce as discussed in Note 6. There may be costs associated with the workforce reduction, and our realignment plan may yield unanticipated consequences, such as attrition beyond our planned reduction in staff. In addition, our common stock has recently declined in value below the exercise price of many options granted to employees pursuant to our stock option plan. Thus, the intended benefits of the stock option granted to our employees, the creation of performance and retention incentives, may not be realized. 

        In addition, workforce reductions and management changes create anxiety and uncertainty and may adversely affect employee morale. As a result, we may lose employees whom we would prefer to retain. Due to above factors, our remaining personnel may seek employment with larger, more established companies they perceive as having less volatile stock prices. 

    We may need to raise additional capital in the future to fund our operations. 

        Since our inception, we have funded our operations primarily through sales of equity securities, and not from cash generated by our business. During 2001, we completed two separate private offerings of our common stock. In February 2001, we sold 5.8 million shares of our common stock to a group of private investors, raising approximately $16.1 million in net proceeds. In August 2001, we completed the sale of 9.1 million shares of our common stock to a group of private investors, netting approximately $16.0 million in proceeds. 

        In October 2002, we entered into an agreement with CDC Software Corporation, a wholly owned subsidiary of chinadotcom corporation (NASDAQ: CHINA), pursuant to which CDC Software will make secured loans of up to $7 million in the aggregate. The loans will bear interest at the rate of 12% per annum, payable quarterly in arrears. The principal amount of each loans will be payable in full two years after the date such loan is made. The loans will be secured by all of our assets, both tangible and intangible. As part of this agreement, CDC Software will receive warrants to purchase up to 8 million shares of our common stock at a price of $0.10 per share. In addition, certain financial advisor may receive warrants to purchase up to 400,000 shares of our common stock at a price of $0.10 per share. On October 31, 2002, we closed on the first $5 million of the total loan facility. We expect to close on the remaining $2 million of the total loan amount on or prior to December 31, 2002.

        Although we believe that our current cash and cash equivalents and any net cash provided by operations will be sufficient to meet anticipated cash needs for the next twelve months, a revenue shortfall could require us to reduce operations or raise additional funds through equity or debt financings. We cannot assure you any equity or debt financing will be available to us on favorable terms, if at all, or that if available, such financing will not be dilutive to our stockholders. If we are unable to raise additional capital, we will take actions to conserve our cash balances, including significantly reducing our operating expenses, downsizing our staff and closing existing branch offices, all of which could have a material adverse effect on our business, financial condition and our ability to reduce losses or generate profits. 

    Variations in our quarterly operating results due to such factors as changes in demand for our products and changes in our mix of revenues may cause our stock price to decline. 

        We expect our quarterly operating results to fluctuate. We therefore believe that quarter-to-quarter comparisons of our operating results may not be a good indication of our future performance, and you should not rely on them to predict our future performance or the future performance of our stock price. Our short-term expense levels are relatively fixed and are based on our expectations of future revenues. As a result, a reduction in revenue in a quarter may harm our operating results for that quarter. In the past, our operating results have fallen below the expectations of market analysts and investors. If we fall short of market expectations in future quarters, the price of our common stock may fall. Factors that may cause our operating results to fluctuate on a quarterly basis are as follows: 

• varying size, timing and contractual terms of orders for our products;
• lengthy sales cycles associated with our products;
• changes in the mix of revenue attributable to higher-margin product license revenue as opposed to lower-margin service revenue;
• customers' decisions to defer orders or implementations, particularly large orders or implementations, from one quarter to the next;
• announcements or introductions of new products by our competitors;
• our ability to hire, train and retain sufficient engineering, consulting, training and sales staff; and   
• subcontracting to more expensive consulting organizations to help provide implementation, support and training services when our own capacity is constrained.

     A slowing economy and reductions in information technology spending may negatively affect our revenues. 

        Our revenues may be negatively affected by the increasingly uncertain economic conditions both in the market generally and in our industry. If the economy continues to slow, some companies may reduce their budgets for spending on information technology and business software. As a consequence, our sales cycle may become longer with some customers, and other prospective customers may postpone, reduce, or even forego the purchase of our products and services, which could negatively affect our revenues.

    We have transferred from the Nasdaq National Market to the SmallCap Market, and we may be subject to delisting altogether. 

        In August 2002, we received a notification from The Nasdaq Stock Market that we are out of compliance with the minimum bid price requirement of $1.00 per share set forth in Marketplace Rule 4450(a)(5). Therefore, our common stock is subject to delisting from The Nasdaq National Market. We determined to transition to the Nasdaq SmallCap Market, which would extend the period for which we would be able to regain compliance with the minimum price requirement. In September 2002, Nasdaq informed us that it has approved our application to list Sagent's common stock on the Nasdaq small Cap Market. In November 2002, Nasdaq notified us that we met the initial listing criteria for the SmallCap Market, other than minimum bid price, and that we have until May 6, 2003 to regain compliance with the minimum bid price requirement. We may pursue a reverse stock-split or other measures in an effort to regain compliance.

        In the event our shares are delisted from the Nasdaq SmallCap Market, we will attempt to have our common stock traded on the Nasdaq Over-The Counter Bulletin Board. If our common stock is delisted, it would seriously limit the liquidity of our common stock and impair our potential to raise future capital through the sale of our common stock, which could have a material adverse effect on our business. Delisting could also reduce the ability of holders of our common stock to purchase or sell shares as quickly and as inexpensively as they have done historically, and may have an adverse effect on the trading price of our common stock. Delisting could also adversely affect relationships with vendors and customers. 

    We restated a portion of our financial results for 2001. 

        On November 28, 2001, we announced that we were revising our reported revenues for the first nine months of 2001, as a result of an internal investigation into the validity of sales orders to various government agencies. Our investigation confirmed that sales orders totaling approximately $5 million booked by one of our employees were forged. As a result, we filed Form 10-Q/A's for the periods ended March 31, 2001 and June 30, 2001 with financial statements restated to remove the effect of the invalid sales orders.

        As a result of the restatement, Sagent has been named in shareholder lawsuits. These lawsuits could seriously harm our business and financial condition. In particular, the lawsuits could harm our relationships with existing customers and our ability to obtain new customers. The continued defense of the lawsuits also could result in the diversion of our management's time and attention away from business operations, which could harm our business. Negative developments with respect to the lawsuits could cause our stock price to decline significantly. In addition, although we are unable to determine the amount, if any, that we may be required to pay in connection with the resolution of these lawsuits by settlement or otherwise, the size of any such payment could seriously harm our financial condition. The complaints generally allege that we and the other named defendants made false or misleading statements of material facts about our financial results during 2001. The complaints, in general, do not specify the amount of damages that plaintiffs seek. As a result, we are unable to estimate the possible range of damages that might be incurred as a result of the lawsuits. We have not set aside any financial reserves relating to potential damages associated with any of these lawsuits. 

    Enterprise intelligence software markets may not grow. 

        Since all of our revenues are attributable to the sale of enterprise intelligence software and related maintenance, consulting and training services, if the market for enterprise intelligence software does not grow, our business will not grow. We expect enterprise intelligence software and services to account for substantially all of our revenue for the foreseeable future. Although demand for enterprise intelligence software has grown in recent years, the market may not continue to grow or, even if the market does grow, businesses may not adopt our products. 

    If we fail to expand our direct and indirect sales channels, we will not be able to increase revenues. 

        Competition for highly qualified sales personnel is intense, and we may not be able to recruit and maintain the kind and the number of sales personnel we need. Hiring highly qualified customer service and account management personnel is very competitive in the software industry due to the limited number of people available with the necessary technical skills and understanding of the space. 

        In order to grow our business, we need to increase market awareness and sales of our products and services. To achieve this goal, we need to increase both our direct and indirect sales channels. If we fail to do so, this failure could harm our ability to increase revenues. We currently receive a significant portion of our revenues from direct sales, but we intend to increase sales through indirect sales channels in the future. 

        We intend to derive revenues from indirect sales channels by selling our software through value-added resellers (VARs) and original equipment manufacturers (OEMs). These VARs and OEMs offer our software products to their customers together with consulting and implementation services or integrate our software solutions with other software. Our ability to increase our revenues is dependent on entering into relationships with these VARs and OEMs. 

        We expect as part of our strategy to increase international sales principally through both direct and indirect sales. Our ability to develop and maintain direct and indirect channels will significantly affect our ability to penetrate international markets. 

    Pending litigation could harm our business. 

        During the last two years, Sagent has been the subject of several shareholder lawsuits, which are still pending. In addition, the members of our board of directors have been the subjects of derivate lawsuits alleging breaches of their fiduciary duties to Sagent. More recently, as the result of the restatement by Sagent of its financial results for portions of 2001, Sagent has been named in additional shareholder lawsuits. These lawsuits could seriously harm our business and financial condition. In particular, the lawsuits could harm our relationships with existing customers and our ability to obtain new customers. The continued defense of the lawsuits could also result in the diversion of our management's time and attention away from business operations, which could harm our business. The lawsuits could also have the effect of discouraging potential acquirers from bidding for us or reducing the consideration they would otherwise be willing to pay in connection with an acquisition. In addition, although we are unable to determine the amount, if any, that we may be required to pay in connection with the resolution of these lawsuits by settlement or otherwise, the size of any such payment could seriously harm our financial condition. 

    We have a relatively new management team and there is no guarantee that they will be successful in growing our business. 

        Our management team has not been with us for a significant length of time. In July 2002, Ben Barnes, our President and Chief Executive Officer stepped down, and Andre Boisvert, our Chairman, assumed the role of Interim CEO. Also in July 2002, Steven R. Springsteel, our Chief Financial Officer, was appointed to serve the additional role of Chief Operating Officer. Mr. Springsteel, our Chief Financial Officer, joined us in November 2001. These employees serve "at-will" and may elect to pursue other opportunities at any time. If our management team is unable to work effectively together to accomplish our business objectives, our ability to grow our business could be severely impaired. 

    Recent terrorist and military activities could adversely affect our business. 

        The terrorist attacks in New York and Washington, D.C. on September 11, 2001 disrupted commerce throughout the United States and Europe. In response to such attacks, the United States is actively using military force to pursue those behind these attacks and initiating broader actions against global terrorism. The continued threat of terrorism within the United States and Europe, the escalation of military action and heightened security measures in response to such further threats may cause significant disruption to commerce throughout the world. To the extent that such disruptions result in further reductions in capital expenditures or spending on information technology, longer sales cycles, deferral or delay of customer orders, or an inability to effectively market our products, our revenues would decline, which would materially and adversely affect our business and results of operations. 

    General economic conditions may harm our business.

        We have become increasingly subject to the risks arising from adverse changes in domestic and global economic and political conditions. Because of the recent economic slowdown in the United States and in Europe, and the terrorist events of September 11, companies in many industries are delaying or reducing technology purchases. We experienced the impact of the September 11 events in the third and fourth quarters of 2001 and the recent economic slowdown in 2001 and the three quarters of 2002 with reductions in capital expenditures by our end-user customers, longer sales cycles, deferral or delay of purchase commitments for our products and increased price competition. As a result, if the current economic conditions in the U.S. and Europe continue or worsen, or if a wider or global economic slowdown occurs, we may fall short of our revenue expectations for the fourth quarter of 2002 or for the entire year. These conditions would negatively aff ect our business and results of operations. 

    If we do not keep pace with technological change, our products may be rendered obsolete and our business may fail. 

        Our industry is characterized by rapid technological change, changes in customer requirements, frequent new product introductions and enhancements and emerging industry standards. In order to achieve broad customer acceptance, our products must be compatible with major software and e-commerce applications and operating systems. We must continually modify and enhance our products to keep pace with changes in these applications and systems. If our products were to be incompatible with popular new systems or applications, our business would be significantly harmed. In addition, the development of entirely new technologies replacing existing software could lead to new competitive products that have better performance or lower prices than our products and could render our products obsolete. 

        Delays or problems in the installation or implementation of our new releases may cause customers to forego purchases of our products to purchase those of our competitors. 

    Our markets are highly competitive and competition could harm our ability to sell products and services and reduce our market share. 

        Competition could seriously harm our ability to sell additional software and maintenance and support renewals on prices and terms favorable to us. Additionally, if we cannot compete effectively, we may lose market share. The markets for our products are intensely competitive and subject to rapidly changing technology. We compete against providers of decision support software, data warehousing software and enterprise application software. We also compete with providers of e-Business software, which allows for the electronic delivery of products and services that enable commerce among businesses and end users. Companies in each of these areas may expand their technologies or acquire companies to support greater enterprise intelligence functionality and capability, particularly in the areas of query response time and the ability to support large numbers of users. We may also face competition from vendors of products and turnkey solutions for e-Business applicatio ns that include Internet based information functionality. 

        Many of our competitors have longer operating histories, significantly greater financial, technical, marketing or other resources, or greater name recognition than we do. Our competitors may be able to respond more quickly than we can to new or emerging technologies and changes in customer requirements. 

    We rely, in part, on equity incentives to attract and retain employees, and the performance of our stock price may impair our ability to attract and retain qualified personnel. 

        The market price of our common stock has fluctuated substantially since our initial public offering in April 1999, and has experienced a significant decline since the first quarter of 2000. We have relied historically on our ability to attract and retain employees using equity incentives, and any perception by potential or existing employees that our equity incentives are less attractive could harm our ability to attract and retain qualified employees. 

    We rely on marketing, technology and distribution relationships that may generally be terminated at any time, and if our current and future relationships are not successful, our growth may be limited. 

        We rely on marketing and technology relationships with a variety of companies that, in part, generate leads for the sale of our products. These marketing and technology relationships include relationships with: 

• system integrators and consulting firms;  
• vendors of e-commerce and Internet software;  
• vendors of software designed for customer relationship management or for management of organizations' operational information; 
• vendors of key technology and platforms;  
• demographic data providers; and  
• an application service provider and an Internet hoster. 

        If we cannot maintain successful marketing and technology relationships or cannot enter into additional marketing and technology relationships, we may have difficulty expanding the sales of our products and our growth may be limited. 

    If we lose key licenses we may be required to develop or license alternatives, which may cause delays or reductions in sales. 

        We rely on third-party technologies, and if we are unable to use or integrate these technologies, our product and service development may be delayed. 

        Sagent relies on MainWin from MainSoft to deliver the Solaris versions of the Data Load, Data Access, and WebLink Servers. MainWin is the Windows API ported to Sun Solaris. In addition, Visual Basic for Applications has been embedded in Design Studio and Information Studio to allow customization. We rely on interfaces from Microsoft and Crystal Decisions to integrate Microsoft Excel and Crystal Reports as display options in Design Studio, Information Studio, and WebLink. The Opalis Robot from Opalis provides the basis for the Sagent Automation tool. Automation is a dependency-scheduling tool with extensive integration with operating system level tasks. Opalis may not provide a stable Solaris version in the timeframe expected by our customers. The DirectLink for R/3 product we offer to connect to SAP is based on metadata browsing technology and pool table connectivity from Server Enterprises. DirectLink for Mainframes, which provides connectivity to mainframe d ata sources, is enabled by technologies from Striva and Cross Access. 

    Failure of commercial users to accept internet solutions could limit our future growth. 

        A key element of our strategy is to offer users the ability to access, analyze and report information from a data server through a Web browser. Our growth may be limited if businesses do not accept Internet solutions or perceive them to be cost-effective. Continued viability of the Internet depends on several factors, some of these factors are as follows: 

• Third parties' abilities to develop new enabling technologies in a timely manner; 
• The Internet's ability to handle increased activity;  
• The Internet's ability to operate as a fast, reliable and secure network; and 
• Potential changes in government regulation.

        Moreover, critical issues concerning the commercial use of the Internet, including data corruption, cost, ease of use, accessibility and quality of service, remain unresolved and may negatively affect commerce and communication on the Internet. These issues will need to be addressed in order for the market for our products and services to grow. 

    We have expanded our international operations but may encounter a number of problems in managing overseas operations, which could limit our future growth. 

        We may not be able to successfully market, sell, deliver and support our products and services internationally. Our failure to manage our international operations effectively could limit the future growth of our business. International sales represented approximately 36% and 37% of our total revenue for the three and nine months ended September 30, 2002. We conduct our international sales through local subsidiaries in the United Kingdom, Germany, France, Japan, Brazil, Mexico, the Benelux regions, Australia and the Asia/Pacific and through distributor relationships in South Africa and Italy. We are currently in the process of closing our Brazil office due to changes in our strategy. We expect this process to be completed by the end of 2002. The expansion of our existing international operations and entry into additional international markets will require management attention and significant financial resources. Because of the significant growth in international business, we benefit overall from a weaker dollar and are adversely affected by a stronger dollar relative to major currencies worldwide. Changes in exchange rates, and in particular a strengthening of the U.S. dollar, may unfavorably affect our consolidated sales and net income. 

    We have been, and may be subject to future, intellectual property infringement claims. 

        We may be subject, from time to time, to claims that we are infringing the intellectual property rights of others. Any litigation regarding intellectual property rights may be costly to defend or settle, and may divert the attention of our management and key personnel from our business operations. The complexity of the technology involved and the uncertainty of intellectual property litigation increase these risks. Claims of intellectual property infringement might also require us to enter into costly royalty or license agreements. In December 2000, we settled an infringement claim brought by Timeline, Inc. Under the terms of the settlement, we paid Timeline $600,000 and issued 600,000 shares of our common stock to Timeline. We may be subject to similar or more costly claims in the future or may become subject to an injunction against use of our products. A successful claim of patent or other intellectual property infringement against us would have an immediate mate rial adverse effect on our business and financial condition. 

    If we are unable to protect our intellectual property rights, this inability could weaken our competitive position, reduce our revenue and increase our costs. 

        Our success depends in large part on our proprietary technology. We rely on a combination of copyright, trademark and trade secrets, confidentiality procedures and licensing arrangements to establish and protect our proprietary rights. We may be required to spend significant resources to monitor and police our intellectual property rights. If we fail to successfully enforce our intellectual property rights, our competitive position may be harmed. 

        Other software providers could copy or otherwise obtain and use our products or technology without authorization. They also could develop similar technology independently which may infringe our proprietary rights. We may not be able to detect infringement and may lose a competitive position in the market before we do so. In addition, competitors may design around our technology or develop competing technologies. The laws of some foreign countries do not protect proprietary rights to the same extent, as do the laws of the United States. 

    If we discover software defects we may have product-related liabilities, which may lead to loss of revenue or delay in market acceptance for our products. 

        Our software products are internally complex and may contain errors, defects or failures, especially when first introduced or when new versions are released. We test our products extensively prior to releasing them; however, in the past we have discovered software errors in some of our products after their introduction. Despite extensive testing, we may not be able to detect and correct errors in products or releases before commencing commercial shipments, which may result in loss of revenue or delays in market acceptance. 

        Our license agreements with our customers typically contain provisions designed to limit our exposure to potential product liability claims. All domestic and international jurisdictions may not enforce these limitations. Although we have not experienced any product liability claims to date, we may encounter such claims in the future. Product liability claims, whether or not successful, brought against us could divert the attention of management and key personnel and could be expensive to defend. 

    We have anti-takeover defenses that could delay or prevent an acquisition of our company. 

        Provisions of our certificate of incorporation, bylaws, other agreements and Delaware law could make it more difficult for a third party to acquire us, even if doing so would be beneficial to our stockholders. Our board of directors could choose not to negotiate with an acquirer that it did not feel was in the strategic interests of our company. If the acquirer was discouraged from offering to acquire us, or prevented from successfully completing a hostile acquisition by the anti-takeover measures, you could lose the opportunity to sell your shares at a favorable price. 

Item 3. Quantitative and Qualitative Disclosure About Market Risk. 

        The following discusses our exposure to market risk related to changes in interest rates, foreign currency exchange rates and equity prices. This discussion contains forward-looking statements that are subject to risks and uncertainties. Actual results could vary materially as a result of a number of factors including those set forth in "Risk Factors That May Affect Results". 

INTEREST RATE RISK 

        Our exposure to market risk related to changes in interest rates is primarily due to our highly liquid investments. We do not use derivative financial instruments. The primarily objective of our investment activities is to preserve principal while maximizing yields without significantly increasing risk. Our investments consist primarily of highly liquid investments and certificate of deposits. Due to the nature of our investments, we believe that there is no material risk exposure. All investments are carried at cost, which approximates market value. At September 30, 2002 and December 31, 2001, we had $6.0 and $16.3 million, respectively, in cash equivalents and restricted cash. 

FOREIGN CURRENCY EXCHANGE RATE RISK 

        A high percentage of operations are based in the United States, and, accordingly, the majority of our transactions are denominated in U.S. Dollars. However, we do have foreign-based operations where transactions are denominated in foreign currencies and are subject to exchange rate risk with respect to fluctuations in the relative value of currencies. Currently, we have operations throughout Asia, Asia Pacific, Europe, Australia, Middle East, South Africa and Latin America and conduct transactions in the local currency of each location. To date, the impact of any fluctuation in the relative value of other currencies has not been material due to relative size of the operation. However, we will continue to monitor our exposure to currency fluctuations, and, when appropriate, may use financial hedging techniques in the future to minimize the effect of these fluctuations, we cannot assure you that exchange rate fluctuations will not harm our business in the future. An i ncrease in the value of the United States dollar relative to foreign currencies could make our products less competitive in international markets. Although we will continue to monitor our exposure to currency fluctuations and, when appropriate, may use economic hedging techniques in the future to minimize the effect of these fluctuations, we can make no assurances that exchange rate fluctuations will not adversely affect our financial results in the future. Through September 30, 2002, the Company had not engaged in foreign currency hedging activities. 

EQUITY PRICE RISK 

        We do not own any significant public equity investments. Therefore, we believe we are not currently exposed to any direct equity price risk. 

Item 4. Controls and Procedures.

(a) Evaluation of disclosure controls and procedures.

        Our chief executive officer and our chief financial officer, after evaluating our "disclosure controls and procedures" (as defined in Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-14(c) and 15-d-14(c)) as of a date (the "Evaluation Date") within 90 days before the filing date of this Quarterly Report on Form 10-Q have concluded that as of the Evaluation Date, our disclosure controls and procedures are effective to ensure that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

(b) Changes in internal controls. 

        Subsequent to the Evaluation Date, there were no significant changes in our internal controls or in other factors that could significantly affect our disclosure controls and procedures, nor were there any significant deficiencies or material weaknesses in our internal controls. As a result, no corrective actions were required or undertaken. 

PART II-OTHER INFORMATION 

Item 1. Legal Proceedings 

         From time to time, the Company has been subject to litigation including the pending litigation described below. Because of the uncertainties related to both the amount and range of loss on the pending litigation, management is unable to make a reasonable estimate of the liability that could result from an unfavorable outcome. As additional information becomes available, the Company will assess its potential liability and revise its estimates. Pending or future litigation could be costly, could cause the diversion of management's attention and could upon resolution, have a material adverse affect on our business, result of operations, financial condition and cash flow. 

        In addition, the Company is engaged in certain legal and administrative proceedings incidental to our normal business activities and believes that these matters will not have a material adverse effect on our financial position, result of operations or cash flow. 

        From October 20, 2000 to November 27, 2000, several class action lawsuits were filed in the United States District Court on behalf of the individual investors who purchased Company common stock between October 21, 1999 and April 18, 2000. The claims allege that the Company misrepresented its prospects for 1999 and the first quarter of 2000. Thereafter, the court consolidated the complaints and selected a lead plaintiff and counsel. A consolidated amended complaint was filed in April 2001. Sagent filed a motion to dismiss the consolidated amended complaint. On September 28, 2001, the court granted Sagent's motion, and gave the plaintiffs leave to amend the complaint. On December 28, 2001, the class plaintiffs filed a second amended complaint. Sagent filed a motion to dismiss that complaint on February 15, 2002. The hearing on Sagent's motion was held on June 3, 2002. On June 5, 2002, the Court issued an order granting in part and denying in part Sagent's motion to di smiss the second amended complaint. 

        Thereafter, the plaintiffs filed a third amended complaint. Sagent has moved to strike certain portions of that complaint on the grounds that those particular allegations were dismissed by the Court from the prior complaint. On August 26, 2002, the court sustained Sagent's motion to strike certain portions of the complaint. Sagent has answered the complaint. Because certain claims survived the motion to dismiss the prior complaint, and the discovery stay is no longer in effect for those allegations, the parties are engaging in discovery. 

        On November 17, 2000, a derivative lawsuit was filed by a purported Company shareholder in the Superior Court of California for the County of San Mateo (the "Fanucci Complaint"). On February 9, 2001, a second derivative lawsuit was filed in the Superior Court of California for the County of Santa Clara (the "Hu Complaint"). The complaints name certain of the Company's present and former officers and directors as defendants. The Hu Complaint also names an investment bank retained by the Company and an employee of that investment bank as defendants. The Company has also been named as a nominal defendant in each complaint. The principal allegation of the complaints is that the defendants breached their fiduciary duties to the Company through the dissemination of allegedly misleading and inaccurate information and other allegations. In July 2001, the two cases were coordinated for pretrial purposes in the Superior Court of California for the County of Santa Clara. The Company filed a motion to dismiss the Fanucci Complaint, on the grounds that, among other things, the plaintiff had failed to make a pre-suit demand on the board of directors as required by Delaware law. The officer and director defendants joined in that motion, and also moved to dismiss on the grounds that the complaint fails to allege the asserted causes of action against the individual defendants. Similar motions were filed concerning the Hu Complaint. The parties agreed to stay the Hu Complaint indefinitely, pending the outcome of the Fanucci matter, and the court entered an order staying the Hu Complaint on January 11, 2002. Thereafter, on January 16, 2002, the Fanucci plaintiff filed a motion to transfer and/or remand that case back to the Superior Court for San Mateo County where it was originally filed. The court heard oral arguments on the defendants' motion to dismiss the Fanucci Complaint, and the plaintiffs' transfer motion on January 28, 2002. On March 1, 2002, the court issued an order sustaining the Company's motion to dismiss, granting the plaintiff leave to amend the complaint, denying the plaintiff's motion to transfer and/or remand the Fanucci case to San Mateo County, and ordering the Company to produce a limited quantity of documents to the plaintiff. 

        The Fanucci plaintiff filed an amended complaint in April 2002. Sagent and the individual defendants each filed a motion to dismiss to that complaint. The Court heard oral argument on July 9, 2002 and thereafter sustained the motions to dismiss, holding that the nominal plaintiff did not have standing to litigate the complaint where he had failed to make a pre-suit demand on the Company's Board of Directors as required by Delaware law. The plaintiffs have not filed an amended complaint to date. 

        In October 2001, infoUSA, Inc. filed a complaint against Sagent in the District Court of Douglas County, Nebraska, seeking amounts infoUSA claims are owed under a license agreement between Sagent and infoUSA. The amount of the claim is $900,000, plus interest. A default judgment for the full amount of the claim was entered against Sagent on December 20, 2001, for failure by Sagent to respond to the initial complaint. Sagent filed a motion to set aside the default judgment in January 2002. On February 22, 2002, the court granted Sagent's motion to set aside the default judgment, and allowed Sagent to file its answer to the complaint. Currently, Sagent and infoUSA are engaged in pretrial discovery; no trial date has been set. 

        In November and December 2001, several class action lawsuits were filed in the United States District Court for the Northern District of California on behalf of investors who purchased Company common stock between May 11, 2001 and November 28, 2001. The complaints allege that the Company and certain of its officers and directors violated the Securities Exchange Act of 1934, as amended. Thereafter, the court consolidated the complaints and selected a lead plaintiff and counsel. A consolidated complaint was filed in April 2002. The complaint alleges that during the class period, the defendants caused the Company's shares to trade at artificially inflated levels through the issuance of false and misleading financial statements. Sagent filed a motion to dismiss that complaint on April 18, 2002. On August 14, 2002, the court issued an order sustaining Sagent's motion to dismiss, granting the plaintiff leave to amend the complaint. The plaintiffs have submitted papers to the Court stating their intent not to file an amended complaint.

        In February 2002, two derivative lawsuits were filed by purported Company shareholders in the United States District Court for the Northern District of California. The complaints name certain of the Company's present and former officers and directors as defendants. The principal allegation of the complaints is that the defendants breached their fiduciary duties to the Company through the dissemination of allegedly misleading and inaccurate information and other allegations. The cases have been consolidated and the plaintiffs have not yet filed a consolidated complaint. The defendants filed a notion to dismiss, which is currently scheduled to be heard by the Court on December 18, 2002.

        Following its investigation of the circumstances that lead to the restatement of its financial statements for the first and second quarters of 2001, and the revision of its financial statements for the third quarter of 2001, Sagent entered the Department of Defense's ("DOD") Voluntary Disclosure Program. On June 7, 2002, Sagent filed with the DOD a report of its investigation which revealed that a single non-officer employee was solely responsible for submitting false documents to Sagent which purportedly showed that the Company had entered into contracts with the federal government, and that Sagent had unwittingly submitted requests for payment to U.S. government agencies not knowing that the employee had fabricated those contracts in order to defraud Sagent of various payments and benefits including commission payments.

        In March 2002, Sagent filed suit against MICROS Systems, Inc. ("MICROS") in Santa Clara County California alleging that MICROS had breached a contract to purchase from Sagent certain software and a related service agreement. The value of that contract is $136,000. MICROS removed the case to the United States District Court for the Northern District of California and the case was subsequently transferred to the United States District Court for the District of Maryland, where it is currently pending. MICROS has asserted a counterclaim against Sagent, alleging various torts and breaches of duties. MICROS' counterclaim seeks in excess of $1 million in damages. The parties are in the early stages of discovery.

        Sagent and Smart Online, Inc. ("Smart Online") entered into a Mutual OEM Agreement effective September 19, 2000. Disputes arose related to the relationship between the parties and Smart Online filed a lawsuit in North Carolina. Sagent filed a lawsuit in California and Smart Online filed a Cross-complaint in the California action. The parties entered into a Settlement and Mutual Release Agreement effective July 16, 2002, which terminated the relationship between the parties and waived and released all disputes without any cost to either party. 

        In connection with a dispute that arose with certain consultants over Sagent's operations in Brazil, in October 2002 Sagent entered into a Settlement Agreement with the Brazilian consultants and their consulting company. The consultants had filed a lawsuit against Sagent. The Settlement Agreement calls for Sagent to pay $400,000 to the consultants in full settlement of all claims, at which time the lawsuit will be dismissed. The settlement was accrued as of September 30, 2002. Sagent  paid the settlement amount in October 2002, and the lawsuit will be shortly dismissed.

        In early 2000, the Company entered into a software license agreement with Mountain Energy Corporation ("MEC"). MEC filed for bankruptcy in October 2000. The Company recently received a letter from the MEC bankruptcy trustee alleging that the Company had recently received certain preferential payment and demanding that the Company disgorge those payments. The amount in controversy is approximately $1,040,000.

Item 2. Changes in Securities and Use of Proceeds. Not applicable. 

Item 3. Defaults upon Senior Securities. Not applicable. 

Item 4. Submission of Matters to a Vote of Security Holders. Not applicable. 

Item 5. Other Information. Not applicable. 

Item 6. Exhibits and Reports on Form 8-K 

    (a) Exhibits 

THE EXHIBITS LISTED IN THE ACCOMPANYING INDEX TO EXHIBITS ARE INCORPORATED BY REFERENCE AS PART OF THIS FORM 10-Q. 

    (b) Reports on Form 8-K 

No reports on Form 8-K were filed during the quarter ending September 30, 2002. 

SIGNATURES 

        Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report on Form 10-Q to be signed on its behalf by the undersigned thereunto duly authorized.

                                                                                                                                              SAGENT TECHNOLOGY, INC.

Dated: November 13, 2002                                                                                                    /s/ Steven R. Springsteel

                                                                                                                                              ________________________________________
                                                                                                                                              Steven R. Springsteel
                                                                                                                                              Chief Operating Officer and
                                                                                                                                              Chief Financial Officer
                                                                                                                                              (Principal Financial and Accounting Officer)

CERTIFICATIONS

I, Andre M. Boisvert, certify that: 

1. I have reviewed this quarterly report on Form 10-Q of Sagent Technology, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
   a)        designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
   b)        evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and
   c)        presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
   a)        all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
   b)        any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Dated: November 13, 2002                                                                                                    /s/ Andre M. Boisvert

                                                                                                                                              ________________________________________
                                                                                                                                              Andre M. Boisvert
                                                                                                                                              Interim Chief Executive Officer
                                                                                                                                              

CERTIFICATIONS

I, Steven R. Springsteel, certify that: 

1. I have reviewed this quarterly report on Form 10-Q of Sagent Technology, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report; 

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report; 

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
   a)        designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
   b)        evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this quarterly report (the "Evaluation Date"); and
   c)        presented in this quarterly report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
   a)        all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and
   b)        any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

6. The registrant's other certifying officer and I have indicated in this quarterly report whether or not there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
   

Dated: November 13, 2002                                                                                                    /s/ Steven R. Springsteel

                                                                                                                                              ________________________________________
                                                                                                                                              Steven R. Springsteel
                                                                                                                                              Chief Operating Officer and
                                                                                                                                              Chief Financial Officer
                                                                                                                                              

Dated: November 13, 2002                                                                                                    /s/ Andre M. Boisvert

Dated: November 13, 2002                                                                                                    /s/ Steven R. Springsteel

                                                                                                                                              ________________________________________
                                                                                                                                              Steven R. Springsteel
                                                                                                                                              Chief Operating Officer and
                                                                                                                                              Chief Financial Officer