8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) September 7, 2001

JDA Software Group, Inc.

(Exact name of registrant as specified in charter)

Delaware
(State or other jurisdiction
of incorporation) 0-27876
(Commission
File Number) 86-0787377
(IRS Employer
Identification No.)

14400 N. 87th Street, Scottsdale, Arizona
(Address of principal executive offices) 85260-3649
(Zip Code)

Registrant’s telephone number, including area code (480) 308-3000

(Former name or former address, if changed since last report)

Item 2. Acquisition or Disposition of Assets.

         On September 7, 2001, JDA Software Group, Inc. (the “Registrant”) completed the acquisition (the “Acquisition”) of E3 Corporation (“E3”), a Georgia corporation, pursuant to an Agreement and Plan of Reorganization among the Registrant, E3, certain shareholders of E3, and E3 Acquisition Corp., a wholly-owned subsidiary of the Registrant formed for the purpose of effecting the merger.

         E3 develops, markets and supports inventory optimization systems.

         The purchase price of approximately $50 million was determined through arms-length negotiations among the parties and consisted of $20 million in cash and the exchange of 1,600,085 shares of the Registrant’s common stock for all of the outstanding common stock of E3. Approximately 10% of the cash consideration and stock certificates were placed into escrow for the purpose of securing the indemnification obligations of E3. In addition, the purchase price is subject to adjustment, pursuant to the provisions of the Agreement and Plan of Reorganization, upon receipt of a balance sheet dated as of the closing date. The source of the funds for the cash consideration came from the Registrant’s immediately available funds.

         The shares issued in the transaction were not registered with the Securities and Exchange Commission and were issued in a transaction exempt from the registration provisions of the Securities Act of 1933 (the "Securities Act") pursuant to the exemption set forth in Section 4(2) of the Securities Act. As part of the transaction the former E3 shareholders received contractual rights to cause JDA to file a registration statement with the SEC for the purposes of registering their JDA shares for resale. In particular, beginning December 8, 2001, and subject to certain limitations, the holders of a majority of the JDA shares issued in the transaction can make demand upon JDA to register up to approximately 800,000 shares of JDA Common Stock. The former E3 shareholders also received certain rights to include their shares in any registration initiated by JDA. A copy of the Registration Rights Agreement executed as part of the transaction is included with this filing as Exhibit 4.1.

         The Acquisition was structured as reorganization within the meaning of Section 368(a) of the Internal Revenue Code and has been accounted for under the purchase method of accounting. Prior to the execution of the Agreement and Plan of Reorganization, there were no material relationships between the Registrant or its affiliates, and E3 or its affiliates, or between any officers or directors of the Registrant or its affiliates, and the officers or directors of E3 or its affiliates.

Item 7. Financial Statements and Exhibits.

(a)	Financial statements of business acquired.
	Financial statements for the business acquired as described in Item 2 above will be filed by the required date by amendment to this Form 8-K.
(b)	Pro forma financial information.
	Pro forma financial information reflecting the effect of the business acquired as described in Item 2 above will be filed by the required date by amendment to this Form 8-K.
(c)	Exhibits.

Exhibit No.	Description
2.1	Agreement and Plan of Reorganization dated as of September 7, 2001, by and among JDA Software Group, Inc., E3 Acquisition Corp., E3 Corporation and certain shareholders of E3 Corporation
4.1	Registration Rights Agreement dated as of September 7, 2001, by and among JDA Software Group, Inc. and the former E3 shareholders
99.1	Press release issued September 10, 2001.

SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		JDA Software Group, Inc.
Date: September 21, 2001	By:	/s/ Kristen L. Magnuson Kristen L. Magnuson Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.	Description
2.1	Agreement and Plan of Reorganization dated as of September 7, 2001, by and among JDA Software Group, Inc., E3 Acquisition Corp., E3 Corporation and certain shareholders of E3 Corporation
4.1	Registration Rights Agreement dated as of September 7, 2001, by and among JDA Software Group, Inc. and the former E3 shareholders
99.1	Press release issued September 10, 2001.

EX-2.1 3 p65597ex2-1.txt EX-2.1 1 EXHIBIT 2.1 AGREEMENT AND PLAN OF REORGANIZATION among JDA SOFTWARE GROUP, INC., a Delaware corporation ("JDA"), E3 ACQUISITION CORP., a Delaware corporation and wholly-owned subsidiary of JDA, E3 CORPORATION, a Georgia corporation ("E3"), and THE SHAREHOLDERS of E3 Dated as of September 7, 2001 2

TABLE OF CONTENTS Page ARTICLE I THE MERGER................................................................. 1 Section 1.1 Effective Time of the Merger.......................................... 1 Section 1.2 Closing............................................................... 1 Section 1.3 Effects of the Merger................................................. 2 Section 1.4 Directors and Officers................................................ 2 ARTICLE II CONVERSION OF SECURITIES................................................... 2 Section 2.1 Certain Definitions................................................... 2 Section 2.2 Conversion of E3 Capital Stock; Payment of Indebtedness............... 10 Section 2.3 Surrender of Certificates............................................. 12 Section 2.4 Ancillary Agreements.................................................. 13 Section 2.5 Escrow................................................................ 13 Section 2.6 Certificate Legends................................................... 14 Section 2.7 Treatment of E3 Options............................................... 15 ARTICLE III REPRESENTATIONS AND WARRANTIES OF E3....................................... 15 Section 3.1 Organization, Standing, Power and Subsidiaries........................ 15 Section 3.2 E3 Capital Structure.................................................. 16 Section 3.3 Authority; Required Filings and Consents.............................. 16 Section 3.4 Financial Statements.................................................. 17 Section 3.5 Absence of Undisclosed Liabilities.................................... 18 Section 3.6 Absence of Certain Changes or Events.................................. 18 Section 3.7 Taxes................................................................. 19 Section 3.8 Tangible Assets and Real Property..................................... 21 Section 3.9 Intellectual Property................................................. 22 Section 3.10 Bank Accounts......................................................... 24 Section 3.11 Contracts............................................................. 24 Section 3.12 Labor Difficulties.................................................... 26 Section 3.13 Trade Regulation..................................................... 27 Section 3.14 Environmental Matters................................................. 27 Section 3.15 Employee Benefit Plans................................................ 28 Section 3.16 Compliance with Laws.................................................. 31 Section 3.17 Employees and Consultants............................................. 31 Section 3.18 Litigation............................................................ 32 Section 3.19 Restrictions on Business Activities................................... 33 Section 3.20 Governmental Authorization............................................ 33 Section 3.21 Insurance............................................................. 33 Section 3.22 Interested Party Transactions......................................... 33 Section 3.23 No Existing Discussions............................................... 34 Section 3.24 Real Property Holding Corporation..................................... 34 Section 3.25 Corporate Documents................................................... 34 Section 3.26 Aliens................................................................ 34 Section 3.27 Indemnification Claims................................................ 35 Section 3.28 Power of Attorney..................................................... 35 Section 3.29 No Misrepresentation.................................................. 35

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TABLE OF CONTENTS Page ARTICLE IIIA REPRESENTATIONS AND WARRANTIES OF EACH SIGNING SHAREHOLDER................................................................ 35 Section 3A.1 Ownership and Status of E3 Common Stock............................... 35 Section 3A.2 Power of the Signing Shareholder; Approval of the Merger.............. 36 Section 3A.3 No Conflicts or Litigation............................................ 36 Section 3A.4 Preemptive and Other Rights; Waiver................................... 36 Section 3A.5 Accredited Investor Status; Sophistication............................ 37 ARTICLE IV REPRESENTATIONS AND WARRANTIES OF JDA AND SUB.............................. 37 Section 4.1 Organization.......................................................... 37 Section 4.2 JDA Capital Structure................................................. 37 Section 4.3 Authority; No Conflict; Required Filings and Consents................. 38 Section 4.4 SEC Filings; Financial Statements..................................... 39 Section 4.5 Absence of Undisclosed Liabilities.................................... 39 Section 4.6 Absence of Certain Changes or Events.................................. 39 Section 4.7 Litigation............................................................ 39 Section 4.8 Board Approval and Recommendation..................................... 40 Section 4.9 Tax Treatment......................................................... 40 Section 4.10 No Prior Activities................................................... 40 ARTICLE V CONDUCT OF BUSINESS........................................................ 40 [Intentionally Deleted]............................................................. 40 ARTICLE VI ADDITIONAL AGREEMENTS...................................................... 40 Section 6.1 No Solicitation....................................................... 40 Section 6.2 Access to Information................................................. 40 Section 6.3 Legal Conditions to Merger............................................ 40 Section 6.4 Public Disclosure..................................................... 40 Section 6.5 Tax-Free Reorganization............................................... 40 Section 6.6 E3 401(k) Plan........................................................ 41 Section 6.7 Brokers or Finders.................................................... 41 Section 6.8 Additional Agreements; Reasonable Efforts............................. 41 Section 6.9 Expenses.............................................................. 41 Section 6.10 Updating Schedules.................................................... 42 Section 6.11 Directors and Officers of Subsidiaries................................ 42 ARTICLE VII CONDITIONS TO MERGER....................................................... 42 Section 7.1 Conditions to Each Party's Obligation to Effect the Merger............ 42 Section 7.2 Additional Conditions to Obligations of JDA and Sub................... 43 Section 7.3 Additional Conditions to Obligations of E3............................ 44 ARTICLE VIII TERMINATION AND AMENDMENT.................................................. 46 [Intentionally Deleted]............................................................. 46 ARTICLE IX INDEMNIFICATION............................................................ 46 Section 9.1 Survival of Representations and Warranties............................ 46 Section 9.2 Indemnification by Shareholders....................................... 46 Section 9.3 Procedures for Indemnification........................................ 47

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TABLE OF CONTENTS Page Section 9.4 Defense of Third Party Claims......................................... 47 Section 9.5 Settlement of Third Party Claims...................................... 48 Section 9.6 Manner of Indemnification; Excess Indemnification by Indemnifying Shareholders.......................................................... 48 Section 9.7 Appointment of Shareholders' Representative........................... 49 Section 9.8 Indemnification of Shareholders' Representative....................... 50 Section 9.9 Post Closing Indemnification.......................................... 50 ARTICLE X GENERAL PROVISIONS......................................................... 51 Section 10.1 Notices............................................................... 51 Section 10.2 Interpretation........................................................ 52 Section 10.3 Counterparts.......................................................... 52 Section 10.4 Severability.......................................................... 52 Section 10.5 Entire Agreement...................................................... 52 Section 10.6 Governing Law......................................................... 53 Section 10.7 Assignment............................................................ 53 Section 10.8 Third Party Beneficiaries............................................. 53 Section 10.9 Release............................................................... 53 Section 10.10 Gender................................................................ 54

EXHIBITS Exhibit A List of E3 Signing Shareholders Exhibit B Escrow Agreement Exhibit C July Balance Sheet Exhibit D March Balance Sheet Exhibit E Shareholder's Certificate Exhibit F E3 Tax Certificate Exhibit G JDA Tax Certificate Exhibit H Medical Benefits Agreement Exhibit I Opinion of Morris, Manning & Martin, LLP Exhibit J Non-Competition and Non-Solicitation Agreement Exhibit K Opinion of Gray Cary Ware & Freidenrich LLP Exhibit L Registration Rights Agreement Exhibit M Indemnification Schedule SCHEDULES Schedule 1.4 Initial Directors and Officers of the Surviving Corporation Schedule 2.2(b) Merger Consideration Payable to Shareholders Schedule 3.1 Liens Schedule 3.9(j) List of Employee or Consultants Who Developed Intellectual Property Schedule 3.17(b) Employee Contracts, Agreements, Plans or Commitments Schedule 6.7 Brokers and Finders Fees Schedule 7.2(d) Required Consents Schedule 7.2(j) List of Individuals for Proprietary Information and Inventions Assignment Agreement

iii 5 AGREEMENT AND PLAN OF REORGANIZATION THIS AGREEMENT AND PLAN OF REORGANIZATION (this "AGREEMENT") is made and entered into as of September 7, 2001 by and among JDA Software Group, Inc., a Delaware corporation ("JDA"), E3 Acquisition Corp., a Delaware corporation and wholly-owned subsidiary of JDA ("SUB"), E3 Corporation, a Georgia corporation ("E3"), and certain of the shareholders of E3 listed on Exhibit A attached hereto (individually, a "SIGNING SHAREHOLDER" and collectively, the "SIGNING SHAREHOLDERS"). RECITALS WHEREAS, the Board of Directors of each of JDA, Sub and E3 deems it advisable and in the best interests of its respective corporation and the shareholders of its respective corporation that JDA and E3 combine in order to advance the long-term business interests of JDA and E3; WHEREAS, the combination of JDA and E3 shall be effected by the terms of this Agreement through a transaction (the "MERGER") in which E3 will merge with and into Sub, Sub will remain a wholly-owned subsidiary of JDA and the shareholders of E3 receive a combination of cash and JDA Common Stock; and WHEREAS, for federal income tax purposes, it is intended that the Merger shall qualify as a reorganization within the meaning of Section 368(a) of the Code. NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, covenants and agreements set forth below, the parties agree as follows: ARTICLE I THE MERGER Section 1.1 Effective Time of the Merger. Subject to the provisions of this Agreement, a certificate of merger (the "CERTIFICATE OF MERGER") in such form as is required by the relevant provisions of the Delaware General Corporation Law and the Georgia Business Corporation Code shall be duly prepared, executed and acknowledged by the Surviving Corporation (as defined in Section 2.1) and delivered to the Delaware Secretary of State and the Georgia Secretary of State for filing as soon as practicable after the Closing (as defined in Section 1.2). Unless otherwise provided in the Certificate of Merger, the Merger shall become effective upon the filing of the Certificate of Merger with the Delaware Secretary of State and the Georgia Secretary of State (the "EFFECTIVE TIME"). Section 1.2 Closing. The closing of the Merger (the "CLOSING") will take place at 4:30 p.m., Eastern Time, on a date to be specified by JDA and E3 (the "CLOSING DATE"), which shall be no later than the second business day after the latest to occur of the satisfaction or waiver of all of the conditions set forth in Sections 7.1, 7.2(b) (other than the delivery of the officers' 1 6 certificate referred to therein) and 7.3(b) (other than the delivery of the officers' certificate referred to therein), provided that the other closing conditions set forth in Article VII have been met or waived as provided in Article VII at or prior to the Closing, at the offices of Morris, Manning & Martin, LLP, 1600 Atlanta Financial Center, 3343 Peachtree Road, NE, Atlanta, Georgia 30326-1022 unless another time, date or place is agreed to in writing by JDA and E3, further provided that the Closing Date shall be on or before September 10, 2001 in any case. Section 1.3 Effects of the Merger. (a) At the Effective Time (i) the separate existence of E3 shall cease, and E3 shall be merged with and into Sub, (ii) the Certificate of Incorporation of Sub shall be amended so that Article First of such Certificate of Incorporation shall read as follows: "The name of the corporation is JDA-E3 Corporation" and, as so amended, such Certificate of Incorporation shall be the Certificate of Incorporation of the Surviving Corporation, and (iii) the Bylaws of Sub as in effect immediately prior to the Effective Time shall be the Bylaws of the Surviving Corporation. (b) The Merger shall have the effects set forth in this Agreement and the DGCL and the GBCC. At and after the Effective Time, the Surviving Corporation shall possess all the rights, privileges, powers and franchises of a public as well as of a private nature, and be subject to all the restrictions, disabilities and duties of each of the Constituent Corporations; and all and singular rights, privileges, powers and franchises of each of the Constituent Corporations, and all property, real, personal and mixed, and all debts due to either of the Constituent Corporations on whatever account, as well as for stock subscriptions and all other things in action or belonging to each of the Constituent Corporations, shall be vested in the Surviving Corporation, and all property, rights, privileges, powers and franchises, and all and every other interest shall be thereafter as effectually the property of the Surviving Corporation as they were of the Constituent Corporations, and the title to any real estate vested by deed or otherwise, in either of the Constituent Corporations, shall not revert or be in any way impaired but all rights of creditors and all Liens upon any property of either of the Constituent Corporations shall be preserved unimpaired, and all debts, liabilities and duties of the Constituent Corporations shall thereafter attach to the Surviving Corporation, and may be enforced against it to the same extent as if such debts and liabilities had been incurred by it. Section 1.4 Directors and Officers. The initial directors and officers of the Surviving Corporation shall be the persons identified on Schedule 1.4 hereto, each of whom will hold office in accordance with the Certificate of Incorporation and Bylaws of the Surviving Corporation until their respective successors are duly elected or appointed. ARTICLE II CONVERSION OF SECURITIES Section 2.1 Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth below: "ACQUIRED ENTITY" means E3 or any of the E3 Subsidiaries, collectively the "ACQUIRED ENTITIES." 2 7 "ASSUMED OPTION" means each E3 Option so assumed by JDA under this Agreement. "BALANCE SHEET DATE" means July 31, 2001. "BANK DEBT" means the indebtedness of E3 (including the principal borrowed plus any accrued and unpaid interests and other fees of any kind related thereto) to First Union National Bank under the Amended and Restated Loan and Security Agreement, dated June 1, 2000, as amended, by and between E3 and First Union National Bank. E3 represents and warrants that the outstanding principal and interest amount of such indebtedness, together with any related accrued fees or expenses payable to First Union National Bank, as of and through September 10, 2001 is $8,180,25.27. "BENEFIT OBLIGATIONS" means the employer's aggregate financial liability to provide all current, projected and contingent benefits to Employees or former Employees of E3 or any Acquired Entity, or their beneficiaries or dependents, as the case may be, under the terms of any E3 Employee Plan, regardless of whether an amount less than such aggregate financial liability is reflected on the employer's financial statements under applicable tax or accounting rules. "CASH MERGER CONSIDERATION" means, subject to adjustment pursuant to Section 2.2(d), $20,000,000 less the Excess E3 Transaction Expenses. "CLOSING BALANCE SHEET" means the unaudited consolidated E3 balance sheet dated as of two (2) days prior to the Closing Date prepared in accordance with past practices (other than changes directly related to any change in the deferred revenue account resulting from changes in E3's revenue recognition policy consistent with GAAP) and provided by E3 to JDA within ten (10) days following the Closing Date. "CLOSING E3 TRANSACTION EXPENSE SCHEDULE" has the meaning given it in Section 6.9. "CLOSING STOCK PRICE" means the average closing per share price of JDA Common Stock on the NASDAQ National Market System ("NASDAQ") for the ten consecutive trading days prior to and ending three days prior to the Closing Date. "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of 1985. "CODE" means the Internal Revenue Code of 1986, as amended. "CONFIDENTIALITY AGREEMENT" means the Confidentiality Agreement dated on or about January 11, 2001 between JDA and E3. "CONSENTS" mean consents, authorizations, filings, approvals, orders, clearances, permits, declarations and registrations. "CONSTITUENT CORPORATIONS" means Sub and E3. 3 8 "CONSULTANT" means an individual resident in any jurisdiction who, as of the Effective Time, is an independent contractor or an individual supplied by a third party and who currently provides an Acquired Entity with consulting services related to the business of such Acquired Entity. "CORPORATE DOCUMENTS" has the meaning given it in Section 3.25. "CUSTOMER LICENSE AGREEMENTS" means those license agreements entered into with end users of an E3 Product pursuant to which E3 or an E3 Subsidiary enjoys any right or benefit or undertakes any obligation related to any of the E3 Products, or pursuant to which E3 or an E3 Subsidiary has granted a third party the right to use an E3 Product. The phrases "THE DATE OF THIS AGREEMENT," "THE DATE HEREOF," and terms of similar import, unless the context otherwise requires, shall be deemed to refer to the date set forth on the cover page of this Agreement. "DERIVATIVE WORKS" means all modules, changes, updates, translations, localizations, customizations, enhancements, improvements, modifications, or adaptations to an E3 Product or with respect to E3 Intellectual Property, as such derivative works are developed by an Acquired Entity or a third party under a license, service or support agreement regardless of whether such agreements contain provisions assigning the derivative works to E3. "DGCL" means the Delaware General Corporation Law. "EMPLOYEE" means an individual resident in any jurisdiction who, as of the Effective Time, is an employee of an Acquired Entity (including active or inactive employees). "EFFECTIVE TIME" has the meaning given it in Section 1.1. "ENVIRONMENTAL CLAIM" means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, directives, claims, writs, injunctions, restraining orders, Liens, investigations, proceedings or notices of noncompliance or violation by any person or entity (including any Governmental Authority) alleging liability or potential liability (including, without limitation, potential responsibility for or liability for enforcement costs, investigatory costs, cleanup costs, governmental response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries, fines or penalties) arising out of, based on or resulting from (A) the presence, or Release or threatened Release into the environment, of any Hazardous Materials at any location, whether or not owned, operated, leased or managed by any Acquired Entity or any joint venture; or (B) circumstances forming the basis of any violation, or alleged violation, of any Environmental Law; or (C) any and all claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief resulting from the presence or Release of any Hazardous Materials. "ENVIRONMENTAL LAWS" means all Laws relating to pollution, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or protection of human health as it relates to protection of the environment including, without limitation, Laws relating to Releases or threatened Releases of Hazardous 4 9 Materials, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials. "ENVIRONMENTAL PERMITS" means all environmental approvals, permits, licenses, clearances and consents. "ERISA" means the Employee Retirement Income Security Act of 1974, as amended. "ERISA AFFILIATE" means any trade or business (whether or not incorporated) which is or, at any relevant time, was treated as a single employer with E3 within the meaning of Sections 414(b), (c), (m) or (o) of the Code. "ESCROW" means the escrow arrangement set forth in Section 2.5. "ESCROW AGENT" means The Chase Manhattan Bank. "ESCROW AGREEMENT" means the escrow agreement in substantially the form of Exhibit B attached hereto. "ESCROW PAYMENT" has the meaning given it in Section 9.6(a). "ESCROWED CASH" means a dollar amount equal to ten percent (10%) of the Cash Merger Consideration. "ESCROWED CONSIDERATION" means the Escrowed Cash and the Escrowed Shares. "ESCROWED SHARES" means the number of shares (rounded to the nearest whole share) equal to ten percent (10%) of the Stock Merger Consideration. "ESTIMATED E3 TRANSACTION EXPENSES" has the meaning given it in Section 6.9. "E3 AUTHORIZATIONS" has the meaning given it in Section 3.20. "E3 CAPITAL STOCK" means the E3 Common Stock, including shares issuable upon exercise of or conversion of outstanding vested stock options, warrants, convertible promissory notes or other convertible securities. "E3 COMMON STOCK" means the Common Stock, par value $0.05, of E3. "E3 DISCLOSURE SCHEDULES" means the disclosure schedules to Article III and Article IIIA provided by E3 prior to or on the date hereof. "E3 EMPLOYEE PLAN(S)" has the meaning given it in Section 3.15(a). "E3 FINANCIAL STATEMENTS" has the meaning given it in Section 3.4. "E3 FOREIGN SUBSIDIARY NOTES" means the promissory notes evidencing any indebtedness for monies borrowed by a foreign Subsidiary of E3 to E3, including without 5 10 limitation those promissory notes endorsed by E3 to First Union National Bank as a security interest under the Loan Agreement. A list of the E3 Foreign Subsidiary Notes are listed in the E3 Disclosure Schedule. "E3 INTELLECTUAL PROPERTY RIGHTS" has the meaning given it in Section 3.9(a). "E3 INTERNATIONAL EMPLOYEE PLANS" has the meaning given it in Section 3.15(a). "E3 OPTION" means each outstanding option to purchase shares of E3 Common Stock. "E3 PRODUCT" has the meaning given it in Section 3.9(b). "E3 STOCK OPTION PLAN" means the E3 Corporation Stock Incentive Plan. "E3 SUBSIDIARIES" means E3 Australia Pty Ltd ACN 090 583 798, E3 Mexico S.A. de C.V., E3 Soluciones en Inventario, S.A. de C.V., E3 ESPANA INCORPORATED, S.A., E3 United Kingdom Limited, E3 France, societe anonyme, E3 (Deutchland) GmbH, E3 Italia S.r.l., E3 Norge AS, E3 International Ltd. (FSC-St. Thomas, USVI), E3 North America, Inc., Inventory Management Institute, Inc., E3 Norden Aktiebolag, E3 Danmark ApS and E3 Suomi Logistics Oy. "E3 TRANSACTION EXPENSES" has the meaning given it in Section 6.9. "E3 U.S. EMPLOYEE PLAN" has the meaning given it in Section 3.15(a)(i). "E3'S KNOWLEDGE" means the actual knowledge after reasonable inquiry of the following individuals who are reasonably believed to have knowledge, or could be expected to have knowledge in the course of conducting a reasonably comprehensive investigation, concerning the existence of such matters: E3's directors, corporate officers (with a title of president or vice-president, including the President - Europe), senior legal counsel and senior regional managers (who may be employees of an Acquired Entity rather than employees of E3). In the case of senior regional managers, in the event such senior regional managers are not fluent in a local language, E3's Knowledge shall be deemed to include a reasonable inquiry of the senior local manager who is fluent in that local language. In addition, any reference to the "knowledge of E3" shall include the knowledge of each of the Shareholders. "EXCESS E3 TRANSACTION EXPENSES" means E3 Transaction Expenses greater than $1,550,000, and any amounts paid by E3 for an investment advisor's fairness opinion and any amounts paid by E3 to investment advisors in excess of $850,000. For purposes of calculating any expenses denominated in foreign currencies, the parties will use the exchange rates published in the Wall Street Journal on the date of this Agreement. "EXCESS INDEMNIFICATION LIABILITY CAP" means, with respect to any Indemnification Claim for breach of a representation or warranty contained in Section 3.9, the sum total of the Indemnifying Shareholders' Pro Rata Portion of the Merger Consideration, valued as of the Closing Date. 6 11 "EXCHANGE ACT" means the Securities Act and the Securities Exchange Act of 1934, as amended. "EXCHANGE RATIO" has the meaning set forth in Section 2.2(b)(i). "FLOOR AMOUNT" means $500,000. "GAAP" means generally accepted accounting principles. "GBCC" means the Georgia Business Corporation Code, as amended. "GOVERNMENTAL ENTITY" means any court, administrative agency or commission or other governmental authority or instrumentality, whether multilateral, regional, federal, state, provincial or local of any country. "HAZARDOUS MATERIALS" means (a) any petroleum or petroleum products, hydrocarbons, radioactive materials, asbestos, urea formaldehyde foam insulation and transformers of other equipment that contain dielectric fluid containing polychlorinated biphenyls ("PCBS") in regulated concentrations; and (b) any chemicals, materials or substances which are now defined as or included in the definition of "hazardous substances," "hazardous wastes," "hazardous materials," "extremely hazardous wastes," "restricted hazardous wastes," "toxic substances," "toxic pollutants," or words of similar import, under any Environmental Law; and (c) any other chemical, material, substance or waste, which is regulated under any Environmental Law in a jurisdiction in which any Acquired Entity operates. "HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. The words "INCLUDE," "INCLUDES" and "INCLUDING" when used herein shall be deemed in each case to be followed by the words "without limitation." "INDEMNIFICATION CLAIM" means a claim for indemnification under Article IX. "INDEMNIFYING SHAREHOLDER" means Anders Herlitz, Carl Herlitz, Frank Schuster, and Daniel Craddock. "INDEMNITEE" means the member or members of the JDA Group seeking indemnification under Article IX. "INDEMNITOR" means the party against which a member of the JDA Group is seeking indemnification under Article IX. "INITIAL STOCK PRICE" means $16.171 per share of JDA Common Stock. "IRCA" means the Immigration Reform and Control Act of 1986, as amended. "JDA BALANCE SHEET" means the unaudited consolidated balance sheet of JDA as of June 30, 2001. 7 12 "JDA COMMON STOCK" means the Common Stock, $0.01 par value, of JDA. "JDA DISCLOSURE SCHEDULE" means the disclosure schedule delivered by JDA to E3 on or before the date of this Agreement. "JDA GROUP" means JDA, its officers, directors, employees and agents, all Subsidiaries and affiliates of JDA (including Sub as successor to E3 and all Subsidiaries of E3), and the respective officers, directors, employees and agents of such entities. "JDA LOSSES" has the meaning given it in Section 9.2(a). "JDA SEC REPORTS" means forms, reports and documents required to be filed by JDA with the SEC since January 1, 2001. "JULY BALANCE SHEET" means the consolidated E3 balance sheet dated as of July 31, 2001 delivered by E3 to JDA, attached as Exhibit C hereto. "LAW" or "LAWS" means any constitution, statute, law, ordinance, decree, order, injunction, rule, directive, or regulation of any government or quasi-governmental authority in any jurisdiction, and includes rules and regulations of any regulatory or self-regulatory authority compliance with which is required by Law, in effect on the date hereof, or enacted, adopted or promulgated on or prior to the Closing Date, to the extent the same is applicable to the business of the Acquired Entities. "LICENSED INTELLECTUAL PROPERTY" has the meaning given it in Section 3.9(b). "LIEN" means any lien, pledge, charge, claim, restriction on transfer, mortgage, right of usufruct, option, right of first refusal or preemptive right (whether created by statute, the charter documents of E3 or any agreement to which E3 or any Acquired Entity is a party), purchase money and other security interest or other encumbrance of any sort. "LOAN AGREEMENT" means the Amended and Restated Loan and Security Agreement, dated June 1, 2000, as amended from time to time, by and between E3 and First Union National Bank. The phrase "MADE AVAILABLE" in this Agreement shall mean that the information referred to has been (i) provided to JDA or its representatives, (ii) made available in a data room pursuant to the request of JDA to JDA or its representatives, or (iii) made available to JDA or its representatives at the local office of any Acquired Entity. "MARCH BALANCE SHEET" means the consolidated E3 balance sheet dated as of March 31, 2001 delivered by E3 to JDA, attached as Exhibit D hereto. "MARKET STOCK PRICE" means the per-share closing price of JDA Common Stock on the NASDAQ as of the last day of trading prior to the Closing "MATERIAL ADVERSE EFFECT," with respect to any entity or group of entities, means a material adverse effect on the business, liabilities, assets (including intangible assets), financial 8 13 condition, prospects, or results of operations of such entity and its Subsidiaries, taken as a whole. Without limiting the generality of the foregoing, a condition or occurrence which is reasonably likely to cause the cessation of or material interruption to the business of any Acquired Entity, or which could reasonably be expected to result in, or which does result in, an injunction or order prohibiting or materially interrupting the operations of any Acquired Entity, shall be deemed a Material Adverse Effect. "MATERIAL TANGIBLE ASSETS" means all tangible assets and properties which are material to the conduct of its business as currently conducted or which are reflected on the July Balance Sheet or acquired since the Balance Sheet Date. "MERGER CONSIDERATION" means the Stock Merger Consideration and the Cash Merger Consideration. "NON-FLOOR LOSSES" means the losses, damages, costs and expenses (including reasonable legal fees and expenses) identified as Non-Floor Losses on Exhibit M. "PRE-ACQUISITION CLAIM" has the meaning given it in Section 10.9. "PRE-ACQUISITION MATTER" has the meaning given it in Section 10.9. "PRO RATA PORTION" means for each Shareholder, the percentage of the total Merger Consideration payable to that Shareholder set forth on Schedule 2.2(b). "REGULATION S" means Regulation S promulgated under the Securities Act. "RELEASE" means any release, spill, emission, leaking, injection, deposit, disposal, discharge, dispersal, leaching or migration into the atmosphere, soil, surface water, groundwater or property. "RELEASED PARTIES" means all past, present and future members of the JDA Group. "RETURNS" means all returns, estimates, information statements and reports required to be filed with any taxing authority. "SEC" means the Securities and Exchange Commission "SECURITIES ACT" means the Securities Act of 1933, as amended. "SHAREHOLDER" means each holder of record of E3 Common Stock as of immediately prior to the Effective Time (collectively, the "SHAREHOLDERS"). "SHAREHOLDERS' REPRESENTATIVE" means Anders Herlitz, as the representative and attorney-in-fact for and on behalf of the Shareholders. "STOCK MERGER CONSIDERATION" means, subject to adjustment pursuant to Section 2.2(c), the number of shares of JDA Common Stock obtained by dividing $30,000,000 by the Closing Stock Price. 9 14 "STOCK TRANSFER DOCUMENTS" has the meaning given it in Section 2.4. "SUBSIDIARY" means, with respect to any party, any corporation or other organization, whether incorporated or unincorporated, of which (i) such party or any other Subsidiary of such party is a general partner (excluding partnerships, the general partnership interests of which held by such party or any Subsidiary of such party do not have a majority of the voting interest in such partnership) or (ii) such party or any Subsidiary of such party possesses, directly or indirectly, the power to direct or cause the direction of the management and polices of such corporation or other organization, whether through the ownership of voting securities, by contract or otherwise. "SURVIVING CORPORATION" means the Sub. "TAX" or, collectively, "TAXES," means, with respect to any country, any and all federal, provincial, regional, state, city, county, possession and local taxes, assessments and other governmental charges, duties, impositions and liabilities, including taxes based upon or measured by gross receipts, income, profits, sales, use, occupation and volume, quantity or weight of hazardous wastes generated or disposed of, and value added, ad valorem, transfer, registration, franchise, withholding, payroll, recapture, employment, windfall profits, property, capital, severance, premium, customs, duties and excise taxes, together with all interest, penalties and additions imposed with respect to such amounts and any obligations under any agreements or arrangements with any other person with respect to such amounts and including any liability for taxes of a predecessor entity. "THIRD PARTY CLAIM" means any claim made or suit or proceeding instituted against an Indemnitee which, if prosecuted successfully, would be a matter for which such Indemnitee is entitled to indemnification under this Article IX. "TRANSACTION DOCUMENTS" means all other documents required to be executed and delivered by E3 hereunder, including without limitation the Escrow Agreement, Registration Rights Agreement, Medical Benefits Agreements, the Non-competition and Non-solicitation Agreement, intellectual property assignment agreements, and the Stock Transfer Documents. Section 2.2 Conversion of E3 Capital Stock; Payment of Indebtedness. As of the Effective Time, by virtue of the Merger and without any action on the part of the holder of any shares of capital stock of E3 or capital stock of Sub: (a) Capital Stock of Sub. Each issued and outstanding share of the capital stock of Sub shall remain unchanged and such shares shall constitute all the issued and outstanding shares of Common Stock of the Surviving Corporation. (b) Conversion of E3 Common Stock. Each share of E3 Common Stock issued and outstanding immediately prior to the Effective Time will be canceled and extinguished and shall be converted and exchanged, without any action on the part of the Shareholders, into the right to receive, subject to Section 2.5, the following Merger Consideration: 10 15 (i) subject to Section 2.2(c) hereof, that number of validly issued, fully paid and nonassessable shares of JDA Common Stock equal to the amount obtained by (x) the Stock Merger Consideration divided by (y) the number of outstanding shares of E3 Common Stock outstanding immediately prior to the Effective Time (the "EXCHANGE RATIO"); and (ii) subject to Section 2.2(d) hereof, the cash amount equal to (i) the Cash Merger Consideration less the Excess E3 Transaction Expenses and the result divided by (ii) the number of outstanding shares of E3 Common Stock immediately prior to the Effective Time. (iii) The pro-rata distribution of the Merger Consideration for each holder of E3 Capital Stock is set forth on Schedule 2.2(b). (iv) Any adjustments to the Merger Consideration pursuant to Section 2.2(c) and 2.2(d) hereof shall be made on a pro rata basis in accordance with each shareholder's respective ownership of E3 Common Stock immediately prior to the Effective Time. (c) Stock Merger Consideration Adjustment. The Stock Merger Consideration shall be subject to adjustment as follows: (i) If the Closing Stock Price is less than 75% of the Initial Stock Price, then the Stock Merger Consideration shall be determined by dividing $30,000,000 by 75% of the Initial Stock Price. (ii) If the Closing Stock Price is greater than 125% of the Initial Stock Price, then the Stock Merger Consideration shall be determined by dividing $30,000,000 by 125% of the Initial Stock Price. (d) Cash Merger Consideration Adjustment. (i) As soon as practicable but in no event later than the Closing Date, E3 shall provide JDA with the July Balance Sheet. If the shareholders equity listed on the July Balance Sheet has been reduced or increased in an amount greater than $100,000 (other than reductions or increases directly related to any change in the deferred revenue account resulting from changes in E3's revenue recognition policy) from that listed on the March Balance Sheet, the Cash Merger Consideration shall be reduced or increased on a dollar-for-dollar basis for the amount of any reduction or increase, respectively, in shareholder equity in excess of $100,000, as the case may be. (ii) Within ten (10) days following the Closing Date, E3 shall provide JDA with the Closing Balance Sheet. If the shareholders equity listed on the Closing Balance Sheet has been reduced in an amount greater than $500,000 from that listed in the July Balance Sheet, the Cash Merger Consideration shall be reduced on a dollar-for-dollar basis for the amount of any reduction in excess of $500,000. Anything contained in this Agreement to the contrary notwithstanding, the parties agree that [ONE MILLION DOLLARS ($1,000,000)] shall be withheld from the Cash Merger Consideration otherwise payable at the Closing and deposited with Gray Cary Ware and Friedenrich LLP (the "Suspended Funds"), which shall hold the 11 16 Suspended Funds in accordance with this Section 2.2(d)(ii). Within one (1) day following delivery of the Closing Balance Sheet, JDA and E3 shall notify Gray Cary Ware and Friedenrich LLP of their calculation of the adjustment, if any, to be made to the Cash Merger Consideration pursuant to this Section 2.2(d)(ii). If such calculations agree, then the Suspended Funds shall be distributed promptly to the parties entitled thereto pursuant to the terms of this Agreement. If the calculations delivered by JDA and E3 do not agree, then the parties shall use their good faith efforts to agree on such calculations during the immediately following two (2) day period. If the parties do not reach agreement upon the calculations during such two (2) day period, then Gray Cary Ware and Friedenrich LLP shall distribute the Suspended Funds at the end of such two (2) day period in accordance with the calculations delivered by E3. Any interest earned on the Suspended Funds shall be applied on a pro rata basis. The Suspended Funds shall be deemed Cash Merger Consideration only to the extent that such Suspended Funds are distributed to the Shareholders in accordance with this Section 2.2(d)(ii). (e) Adjustment to Exchange Ratio. The Exchange Ratio (including any appropriate adjustments to the Initial Stock Price, Closing Stock Price or Stock Merger Consideration) shall be adjusted to reflect fully the effect of any stock split, reverse split, stock dividend (including any dividend or distribution of securities convertible into JDA Common Stock or E3 Common Stock), reorganization, recapitalization or other like change with respect to JDA Common Stock or E3 Common Stock occurring after the date hereof and prior to the Effective Time, as applicable. (f) Payment of Indebtedness. At Closing, JDA shall deliver a wire transfer to First Union National Bank in the amount of the Bank Debt (plus any additional interest amounts at the daily rate) in full and final satisfaction of the amount owed by E3 to First Union National Bank. Section 2.3 Surrender of Certificates. The procedures for surrendering outstanding shares of E3 Common Stock and receiving the Merger Consideration are as follows: (a) Delivery of E3 Share Certificates. At Closing, each Signing Shareholder who surrenders to JDA certificate(s) representing the number of shares of E3 Common Stock shown as owned by that Signing Shareholder in the E3 Disclosure Schedule, which constitutes all shares of E3 Common Stock held by that Signing Shareholder and includes all necessary transfer tax and other reserve stamps, acquired at that Signing Shareholder's expense, affixed and canceled, shall be entitled to receive that Shareholder's portion of the Merger Consideration. Each Shareholder who is not a Signing Shareholder shall deliver to JDA at Closing or promptly following the Closing, a Shareholder's Certificate in the form attached hereto as Exhibit E and surrender to JDA certificate(s) representing the number of shares of E3 Common Stock shown as owned by that Shareholder in the E3 Disclosure Schedule, which shall constitute all shares of E3 Common Stock held by that Shareholder and will include all necessary transfer tax and other reserve stamps, acquired at that Shareholder's expense, affixed and canceled. Each Shareholder shall cure any deficiencies in the endorsement of the certificates or other documents of conveyance respecting the certificates representing E3 Common Stock surrendered by that Shareholder. The certificates so surrendered at Closing shall be canceled immediately after the Effective Time and the certificates surrendered following the Closing shall be canceled 12 17 immediately after such surrender. Additionally, E3 shall deliver at Closing all share certificate or other documentation or instruments that evidence E3's ownership of the E3 Subsidiaries. (b) Delivery of Closing Merger Consideration. At Closing, upon surrender by each Shareholder of his stock certificate(s) and other required documents to JDA as described in Section 2.3(a), that Shareholder shall receive in exchange therefor (i) subject to Section 2.3(c), a stock certificate issued in the name of that Shareholder representing that number of shares of JDA Common Stock shown on Schedule 2.2(b) as being deliverable to that Shareholder at Closing and (ii) either (A) a check made out to that Shareholder or (B) a wire sent to an account designated by that Shareholder, in each case, in the amount shown on Schedule 2.2(b) as being deliverable to that Shareholder at closing. (c) No Fractional Shares. No certificate or scrip representing fractional shares of JDA Common Stock shall be issued upon the surrender for exchange of certificates pursuant to Section 2.3(a), and such fractional share interests will not entitle the owner thereof to vote or to any rights of a stockholder of JDA. Notwithstanding any other provision of this Agreement, each holder of shares of E3 Common Stock exchanged pursuant to the Merger who would otherwise have been entitled to receive a fraction of a share of JDA Common Stock (after taking into account all certificates for E3 Common Stock delivered by such holder) shall receive, in lieu thereof, cash (without interest) in an amount equal to such fractional part of a share of JDA Common Stock multiplied by the Closing Stock Price. (d) Distributions With Respect to Unexchanged Shares. No dividends or other distributions with respect to JDA Common Stock with a record date after the Effective Time will be paid to the holder of any unsurrendered stock certificate for shares of E3 Common Stock represented thereby until the holder of record of such certificate shall surrender such certificate. Subject to applicable law, following surrender of any such certificate, there shall be paid to the record holder of the certificates representing the whole shares of JDA Common Stock issued in exchange therefor, without interest at the time of the surrender, the amount of any such dividends or other distributions with a record date after the Effective Time theretofore payable (but for the provisions of this Section 2.3(d)) with respect to such shares of JDA Common Stock. Section 2.4 Ancillary Agreements. In connection with the transaction contemplated by this Agreement, at or before the Closing Date, JDA (or the Sub or such Subsidiary or affiliate of JDA as JDA may direct) and E3 and/or the E3 Subsidiaries, as applicable, shall enter into and deliver separate stock purchase agreements or share transfer forms and such other relevant documents as may be required under local Law ("STOCK TRANSFER DOCUMENTS") with respect to the equity interests or other ownership interests of the E3 Subsidiaries being transferred under this Agreement, with only such modifications as are necessary in order to maintain substantially the same legal meaning and effect under local Law as provided in this Agreement. Section 2.5 Escrow. (a) At the Closing, JDA will deposit into Escrow the Escrowed Consideration. The Escrowed Consideration shall be held by The Chase Manhattan Bank or such other financial institution as JDA and E3 shall mutually determine in accordance with and subject to the provisions of an Escrow Agreement. The deposit of the Escrowed Consideration with the 13 18 Escrow Agent on behalf of the Shareholders pursuant to the terms of the Escrow Agreement shall constitute full and final satisfaction of JDA's obligation to deliver that portion of the Merger Consideration equal to the Escrowed Consideration to the appropriate Shareholders in consideration of such Shareholders' respective shares of E3 Common Stock pursuant to this Agreement. As provided in the Escrow Agreement, the Shareholders will have all the rights, title and interest in the Escrowed Shares and the Escrowed Cash as of the Closing Date. (b) Subject to the terms of the Escrow Agreement, within ten (10) days following the first anniversary of the Closing Date, the Escrowed Consideration less (i) any part of the Escrowed Consideration that has previously been paid to JDA under the terms of the Escrow Agreement, and (ii) an amount of the Escrowed Consideration equal to the aggregate amount of all claims, if any, that have been validly tendered by Indemnitees under the Escrow Agreement prior to such date and remain outstanding as of such date, shall be released from the Escrow and delivered to the Shareholders on the basis of their Pro Rata Portion. Section 2.6 Certificate Legends. The shares of JDA Common Stock to be issued pursuant to this Agreement shall not have been registered and shall be characterized as "restricted securities" under the Securities Act, and under such Laws such shares may be resold without registration under the Securities Act only in certain limited circumstances. Each certificate evidencing shares of JDA Common Stock to be issued pursuant to this Agreement shall bear the following legend, with such modification or addition thereto as may be required under local Law: "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). SUCH SHARES MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION WITHOUT AN EXEMPTION UNDER THE ACT OR AN OPINION OF LEGAL COUNSEL REASONABLY ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED." Each stock certificate issued to a Shareholder who is not a U.S. Persons shall bear the following legend, with such modification or addition thereto as may be required under local Law: "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED IN THE UNITED STATES OR TO U.S. PERSONS, EXCEPT (I) IN CONJUNCTION WITH AN EFFECTIVE REGISTRATION STATEMENT COVERING SUCH SHARES, (II) IN COMPLIANCE WITH AN EXEMPTION FROM REGISTRATION UNDER THE ACT, (III) IN RELIANCE OF AN OPINION OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED BASED ON AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT, OR (IV) IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S." 14 19 Section 2.7 Treatment of E3 Options. (a) Prior to the Effective Time, the E3 Stock Option Plan shall have be terminated by E3. (b) Prior to the Effective Time, each outstanding E3 Option issued pursuant to an E3 Employee Plan or otherwise shall have been terminated pursuant to the provisions of such E3 Employee Plan or such other agreement that governs such E3 Option, and E3 shall have no liability contingent or otherwise, therefore. ARTICLE III REPRESENTATIONS AND WARRANTIES OF E3 Except as disclosed in E3 Disclosure Schedules provided to JDA on or before the date of this Agreement, E3 and each of the Signing Shareholders, jointly and severally, represent and warrant to JDA as follows: Section 3.1 Organization, Standing, Power and Subsidiaries. E3 is a corporation duly organized, validly existing and in good standing under the Laws of the State of Georgia. Each E3 Subsidiary has been duly organized and is validly existing legal entity and in good standing or its local equivalent, as applicable, under the Laws of the jurisdiction of its organization (which is set forth in the E3 Disclosure Schedule), except where a failure to be such shall not have a Material Adverse Effect on E3. The E3 Subsidiaries are the only Subsidiaries of E3. Each Acquired Entity has all requisite corporate power to own, lease and operate its properties and to carry on its business as currently being conducted and as currently proposed to be conducted, and is duly qualified to transact business and is in good standing or its local equivalent, as applicable, in each jurisdiction in which the nature of its operations requires such qualification, except where the failure to so qualify has not and will not have a Material Adverse Effect on E3. E3 has delivered true and correct copies of the Articles of Incorporation and Bylaws of E3, and the charter documents of each other Acquired Entity in accordance with relevant local Law, each as amended to date, to JDA. None of the Acquired Entities is in violation of any of the provisions of its Articles or Certificates of Incorporation, Bylaws or other charter documents. No Acquired Entity owns directly or indirectly any equity or similar interest in, or any interest convertible or exchangeable or exercisable for any equity or similar interest in, any corporation, partnership, joint venture or other business association or entity except as set forth in the E3 Disclosure Schedule. E3, or an E3 Subsidiary, owns all of the equity interests or other ownership interests, as applicable under local Law, of each E3 Subsidiary, which equity interests are described in the E3 Disclosure Schedule, free and clear of all Liens except as set forth in Schedule 3.1 attached hereto. E3 has delivered to JDA true and correct copies of the charter documents of each of the E3 Subsidiaries and any other agreement, arrangement or document (i) between E3 and any E3 Subsidiary or (ii) otherwise related to E3's direct or indirect ownership of any E3 Subsidiary. 15 20 Section 3.2 E3 Capital Structure. (a) The authorized capital stock of E3 consists of 50,000,000 shares of common stock, par value $0.05 per share. As of the date hereof, 15,135,065 shares of E3 Common Stock are issued and outstanding and held of record by the Shareholders in the amounts set forth in the E3 Disclosure Schedule. All such outstanding shares of E3 Common Stock have been duly authorized, validly issued, are fully paid and nonassessable, are free of any Liens and have been issued in compliance with all applicable federal and state securities Laws. (b) All outstanding shares or other equity or ownership interests, as applicable under local Law, of the E3 Subsidiaries have been duly authorized, validly issued, are fully paid and nonassessable, or the local Law equivalent, are free of any Liens and have been issued in compliance with all applicable securities Laws in the relevant jurisdictions. (c) There are (i) no equity securities of any class of any Acquired Entity, or any securities exchangeable into or exercisable for such equity securities, issued, reserved for issuance, or outstanding and (ii) no outstanding subscriptions, options, warrants, puts, calls, rights, or other commitments or agreements of any character to which an Acquired Entity is a party or by which it is bound obligating an Acquired Entity to issue, deliver, sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased or redeemed, any equity securities of an Acquired Entity or obligating an Acquired Entity to grant, extend, accelerate the vesting of, change the exercise price of, or otherwise amend or enter into any such option, warrant, call, right, commitment or agreement. There are no contracts, commitments or agreements relating to voting, purchase or sale of any Acquired Entity's equity (i) between or among an Acquired Entity and any of its shareholders, equity holders or holders of ownership interests, as applicable under local Law, or (ii) to any Acquired Entity's knowledge, between or among any of that entity's shareholders, equity holders or holders of ownership interests, as applicable under local Law. Section 3.3 Authority; Required Filings and Consents. (a) E3 has all requisite corporate power and authority to execute and deliver this Agreement and the Transaction Documents, and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the other Transaction Documents to which E3 is or will be a party and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of E3, including the approval of the Merger by the Shareholders as required by the Laws of Georgia. This Agreement has been, and the other Transaction Documents to which E3 and the Acquired Entities are a party have been or will be when they are executed by E3 and the Acquired Entities, duly executed and delivered by E3 and the Acquired Entities and constitute, or will constitute when they are executed by E3 and the Acquired Entities, the valid and binding obligations of E3 and the Acquired Entities, enforceable against E3 and the Acquired Entities in accordance with their respective terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, moratorium or other similar Laws affecting or relating to creditors' rights generally, and (ii) general principles of equity. 16 21 (b) The execution and delivery by E3 of this Agreement and the other Transaction Documents to which it is a party, or will be a party when they are executed by E3, do not, and the consummation of the transactions contemplated hereby and thereby will not, (i) conflict with, or result in any violation or breach of any provision of, the Articles of Incorporation or Bylaws of E3 or charter documents of the Subsidiaries, (ii) result in any violation or breach of or constitute (with or without notice or lapse of time, or both) a default under, or give rise to a right of termination, cancellation or acceleration of any obligation or loss of any benefit under or the payment of any fees or fines under, any material agreement (including any material note, mortgage, indenture, lease, guarantee, contract or other agreement or obligation) to which E3 or any other Acquired Entity is a party or by which E3 or any other Acquired Equity or any of its respective properties or assets may be bound, or (iii) conflict with or violate any permit, concession, franchise, license, judgment or Law applicable to E3 or any other Acquired Entity or any of its respective properties or assets and where such conflict or violation could reasonably expected to have a Material Adverse Effect on E3. (c) No Consent from a Governmental Entity is required by or with respect to E3, the E3 Subsidiaries or its shareholders in connection with the execution and delivery of this Agreement, the Transaction Documents, the Merger or the consummation of the transactions contemplated hereby, except for (i) the filing of a pre-merger notification and report form, by E3 and JDA and, if required, by some or all of the Shareholders, under the HSR Act, (ii) the filing of the Certificate of Merger with the Secretary of State of the State of Georgia in accordance with the GBCC, (iii) such Consents as may be required under applicable federal and state securities Laws in the United States and the securities Laws of other relevant jurisdictions, and (iv) such other Consents which, if not obtained or made, would not have a Material Adverse Effect on E3 or any Acquired Equity and would not prevent or materially alter or delay any of the transactions contemplated by this Agreement. No Acquired Entity or any Shareholder has received any notice, written or otherwise, or has any other knowledge of any plan or intention of any party not to grant any Consent listed in the E3 Disclosure Schedule. Section 3.4 Financial Statements. E3 has delivered to JDA (i) its audited consolidated financial statements for each of the years ended December 31, 1998, 1999 and 2000, (ii) its unaudited consolidated financial statements, including statements of operations and cash flows for the quarters ending March 31, 2001 and June 30, 2001, and (iv) its unaudited financial statements, including statements of operations and cash flows for the current fiscal year through July 31, 2001 and through the date of, and including, the Closing Balance Sheet (collectively, the "E3 FINANCIAL STATEMENTS"). The E3 Financial Statements were prepared in accordance with GAAP and accounting policies applied on a consistent basis throughout the periods involved, except that the unaudited interim E3 Financial Statements do not contain footnotes and that the financial statements dated as of and for periods ending as of March 31, 2001 and July 31, 2001 do not reflect changes in E3's revenue recognition policy consistent with GAAP. The E3 Financial Statements present fairly, in all material respects, the financial position of E3 and the E3 Subsidiaries on a consolidated basis as of the respective dates and the results of its operations and cash flows for the periods indicated, subject, in the case of unaudited interim financial statements, to normal year-end audit adjustments. E3 maintains, and until the Effective Time will continue to maintain, a standard system of accounting established and administered in accordance with GAAP. 17 22 Section 3.5 Absence of Undisclosed Liabilities. None of the Acquired Entities have any liabilities of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise (whether or not required to be reflected in financial statements in accordance with GAAP), and whether due or to become due, other than (i) liabilities reflected or provided for on the Closing Balance Sheet contained in the E3 Financial Statements, (ii) liabilities contemplated by this Agreement and (iii) normal or recurring liabilities incurred since the Balance Sheet Date in the ordinary course of business consistent with past practices. Any liabilities of the type described in clause (iii) of the previous sentence in excess of $500,000, individually or in the aggregate, are listed and described in the E3 Disclosure Schedule. Section 3.6 Absence of Certain Changes or Events. Since the Balance Sheet Date, each Acquired Entity has conducted its business in the ordinary course and in a manner consistent with past practices and, since such date, none of the Acquired Entities has: (a) suffered any event or occurrence (whether singly or in the aggregate) that has had, or is reasonably likely to have, a Material Adverse Effect on the Acquired Entities; (b) suffered any damage, destruction or loss, whether covered by insurance or not, having a Material Adverse Effect on the properties or business of the Acquired Entities; (c) granted any increase in the compensation payable or to become payable by any Acquired Entity to its directors, officers, managers or Employees (except, with respect to the managers and Employees, those increases in compensation occurring in the ordinary course of business consistent with E3's past practices); (d) declared, set aside or paid any dividend or made any other distribution on or in respect of the shares of its capital stock or other equity interests or declared any direct or indirect redemption, retirement, purchase or other acquisition of such shares or other equity interests; (e) issued any shares of its capital stock or any other equity interests or any warrants, rights, or options for, or entered into any commitment relating to such capital stock or any other equity interests; (f) made any material change in the accounting methods or practices it follows, whether for general financial or tax purposes, or any material change in depreciation or amortization policies or rates; (g) sold, leased, subleased, abandoned or otherwise disposed of any real property, leasehold interests, machinery, equipment or other operating property other than in the ordinary course of business; (h) sold, assigned, transferred, licensed or otherwise disposed of any patent, trademark, trade name, brand name, copyright (or pending application for any patent, trademark or copyright), invention, work of authorship, process, know-how, formula or trade secret or interest thereunder or other material intangible asset other than in the ordinary course of business; 18 23 (i) entered into any material commitment or transaction (including, without limitation, any borrowing or capital expenditure) other than in the ordinary course of business; (j) incurred any material liability, except in the ordinary course of business and consistent with past practice; (k) permitted or allowed any of its property, leasehold interests or assets to be subjected to any Lien, except for Liens in place as of the Balance Sheet Date and disclosed to the Buyer pursuant to this Agreement and Liens for current taxes not yet due and purchase money security interests incurred in the ordinary course of business; (l) made any capital expenditure or commitment for additions to property, plant or equipment individually in excess of $50,000, or, in the aggregate, in excess of $250,000; (m) paid, loaned or advanced any amount to, or sold, transferred or leased any properties or assets to, or entered into any agreement or arrangement with, any of its officers, directors or ten percent (10%) shareholders or any affiliate of any of the foregoing, other than employee compensation and benefits and reimbursement of employment related business expenses incurred in the ordinary course of business; (n) agreed to take any action described in this Section 3.6 or which would constitute a breach of any of the representations or warranties of E3 contained in this Agreement; or (o) taken any other action that would have required the consent of JDA pursuant to Section 5.1 of this Agreement (and which has not been obtained) had such action occurred after the date of this Agreement to the extent not otherwise listed herein. Section 3.7 Taxes. (a) Each Acquired Entity has prepared and timely filed all Returns relating to any and all Taxes concerning or attributable to that Acquired Entity or its operations, such Returns are true and correct in all material respects and have been completed in accordance with applicable Law, and each Acquired Entity has disclosed on its Returns all positions taken therein that could reasonably be expected to give rise to a substantial understatement penalty within the meaning of Section 6662 of the Code (or any predecessor provision or comparable provision of state, local or foreign Law). (b) Each Acquired Entity, as of the Closing Date, (i) will have paid or accrued for on the E3 Financial Statements all Taxes it is required to pay prior to the Closing Date and (ii) will have withheld with respect to its Employees all Taxes required to be withheld. (c) During the period of all unexpired applicable statute of limitations, no Acquired Entity has been delinquent in the payment of any Tax. There is no Tax deficiency outstanding or assessed or, to E3's knowledge, proposed against any Acquired Entity that is not reflected as a liability on the July Balance Sheet or set forth on the E3 Disclosure Schedule, nor has any Acquired Entity executed any agreements or waivers extending any statute of limitations on or extending the period for the assessment or collection of any Tax. 19 24 (d) The Acquired Entities' liability for unpaid Taxes (whether actual or contingent) as of the Closing Date does not exceed the reserve for unpaid Taxes on the Closing Balance Sheet. (e) No Acquired Entity is a party to any tax-sharing agreement or similar arrangement with any other party, and no Acquired Entity has assumed or agreed to pay any Tax obligations of, or with respect to any transaction relating to, any other person or agreed to indemnify any other person with respect to any Tax. (f) No Acquired Entity's Returns have ever been audited by a government or taxing authority, no such audit is in process or pending, and no Acquired Entity has been notified of any request for such an audit or other examination. (g) No Acquired Entity has ever been a member of an affiliated group of corporations filing a consolidated federal income tax return other than a group the common parent of which was E3. (h) Each Acquired Entity has made available to JDA copies of all Returns filed for all periods for the past three (3) tax years. (i) No Acquired Entity has ever filed any consent agreement under Section 341(f) of the Code or agreed to have Section 341(f)(4) apply to any disposition of assets owned by that Acquired Entity. (j) No Acquired Entity is a party to any contract, agreement, plan or arrangement, including but not limited to the provisions of this Agreement, covering any Employee or former Employee of that Acquired Entity which, individually or collectively, could reasonably be expected to give rise to the payment of any amount that would not be deductible as an expense by the Acquired Entity pursuant to Sections 280G, 404 or 162(m) of the Code or by similar applicable Law. (k) E3 has not constituted either a "distributing corporation" or a "controlled corporation" in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code (i) in the two years prior to the date of this Agreement or (ii) in a distribution which could otherwise constitute part of a "plan" or "series of related transactions" (within the meaning of Section 355(e) of the Code) in conjunction with the Merger. (l) E3 has not agreed to make, nor is it required to make, any adjustment under Section 481 of the Code by reason of any change in accounting method. (m) None of the assets of any Acquired Entity is treated as "tax-exempt use property," within the meaning of Section 168(h) of the Code. (n) No Acquired Entity is, or has been, a "reporting corporation" subject to the information reporting and record maintenance requirements of Section 6038A of the Code and the regulations thereunder. 20 25 (o) No Acquired Entity has ever been a party to any joint venture, partnership or other agreement that could reasonably be expected to be treated as a partnership for Tax purposes. (p) There are (and immediately following the Effective Time there will be) no Liens on the assets of any Acquired Entity relating to or attributable to Taxes, other than Liens for Taxes not yet due and payable. (q) Each Acquired Entity is properly registered for purposes of value added tax and all other taxes in each jurisdiction in which such registration is required and no Acquired Entity has received any notice from any taxing authority in a jurisdiction where it has not filed Returns that such Acquired Entity may be subject to taxation in that jurisdiction. (r) No Acquired Entity has requested or received any private letter ruling from the Internal Revenue Service or comparable rulings from any other government or taxing agency. (s) No power of attorney with respect to Taxes has been granted with respect to the Acquired Entities. Section 3.8 Tangible Assets and Real Property. (a) Each Acquired Entity owns or leases all the Material Tangible Assets. The Material Tangible Assets are in such condition and repair, reasonable wear and tear excepted, as is suitable for the purposes for which they are currently used by E3. Each Acquired Entity has good and marketable title to all Material Tangible Assets that it owns (except properties, interests in properties and assets sold or otherwise disposed of since the July Balance Sheet Date in the ordinary course of business), free and clear of all Liens, except for Liens for current Taxes not yet due and payable. Assuming the due execution and delivery thereof by the other parties thereto, all leases of Material Tangible Assets to which an Acquired Entity is a party are in full force and effect and valid, binding and enforceable against the Acquired Entities and, to E3's knowledge, the other party thereto in accordance with their respective terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, moratorium or other similar Laws affecting or relating to creditors' rights generally, and (ii) general principles of equity. The E3 Disclosure Schedule sets forth a true and correct list of all such leases, and true and correct copies of all such leases have been made available to JDA, except for equipment leases which do not have annual payments of $10,000 individually or $25,000 in the aggregate. (b) No Acquired Entity owns any real property. (c) The E3 Disclosure Schedule sets forth a true and complete list of all real property leased, subleased or licensed by an Acquired Entity and all real property subleases to which an Acquired Entity is a party. Assuming the due execution and delivery thereof by the other parties thereto, all such real property leases, subleases and licenses are in full force and effect and valid, binding and enforceable, to E3's knowledge after reasonable investigation of local Law, against the other parties in accordance with their respective terms, except as such enforceability may be limited by (i) bankruptcy, insolvency, moratorium or other similar Laws 21 26 affecting or relating to creditors' rights generally, and (ii) general principles of equity. True and correct copies all such of real property leases and subleases have been made available to JDA. Section 3.9 Intellectual Property. (a) Each Acquired Entity owns, is licensed under or otherwise possesses adequate and legally enforceable rights to use and practice, without future payment or attribution to or consent of any person, all patents, trademarks, trade names, service marks, copyrights (including, without limitation, moral rights), mask works, domain names and Derivative Works, and any applications for and registrations of such patents, trademarks, trade names, service marks, copyrights, mask works and Derivative Works and all processes, formulas, methods, schematics, technology, know-how, computer software programs or applications, databases, trade secrets and tangible or intangible proprietary information or material that are necessary to conduct the business of that Acquired Entity as currently being conducted (all of which are referred to as the "E3 INTELLECTUAL PROPERTY RIGHTS"), free and clear of all Liens. The foregoing representation as it relates to Licensed Intellectual Property is limited to an Acquired Entity's interest pursuant to licenses from third parties, each of which is in full force and effect, is valid, binding and enforceable and grants an Acquired Entity such rights to such intellectual property as are necessary to the business of that Acquired Entity as currently conducted. (b) The E3 Disclosure Schedule contains an accurate and complete list and description of (i) all issued patents, registered trademarks, trade names, registered service marks and registered copyrights therefor included in the E3 Intellectual Property Rights, including the jurisdictions in which each such E3 Intellectual Property Right has been issued or registered or in which any such application for such issuance or registration has been filed, (ii) all pending patent, copyright and trademark applications, (iii) other than those non-exclusive licenses granted to customers in the ordinary course of business, all licenses, sublicenses, development agreements, manufacturing agreements, distribution agreements, agency agreements, commission agreements, options, rights (including marketing rights), and other agreements to which any Acquired Entity is a party and pursuant to which any person is authorized to use any E3 Intellectual Property Rights or has the right to develop, manufacture, reproduce, market, solicit orders for or exploit any current product that is available for license of any Acquired Entity (a "E3 PRODUCT") or any adaptation, translation or Derivative Work based on any E3 Product or any portion thereof, (iv) all licenses, sublicenses and other agreements to which any Acquired Entity is a party and pursuant to which any Acquired Entity is authorized to use any third party technology, trade secret, know-how, process, patent, trademark or copyright, including software and databases ("LICENSED INTELLECTUAL PROPERTY"), which is used in the development, manufacture or marketing of, or is incorporated in or forms a part of any E3 Product (other than licenses for standard off-the-shelf software used in the conduct of any Acquired Entity's business), (v) all joint development agreements to which any Acquired Entity is a party, (vi) all agreements with Governmental Entities, universities, research institutions or other third parties pursuant to which any Acquired Entity has obtained government funding for research and development activities, (vii) a list of all E3 Products, software, code, programmers' notes or other E3 Intellectual Property held in escrow, including the location and status of such escrow and (viii) a table of the E3 Products, the platforms for which they were developed and the development status of such E3 Product. 22 27 (c) The execution and delivery of this Agreement, compliance with its terms and the consummation of the transactions contemplated hereby in accordance with this Agreement do not and will not conflict with, or result in any violation or breach of, or default (with or without notice or lapse of time or both) or give rise to any right, license or Lien relating to any E3 Intellectual Property Rights, any of the agreements of Section 3.9(b), or any right of termination, cancellation or acceleration of any E3 Intellectual Property Rights or any such agreements or any such obligation thereof, or the loss or encumbrance of any E3 Intellectual Property Rights or benefit related thereto, or result in or require the creation, imposition or extension of any Lien upon any E3 Intellectual Property Rights, or cause the acceleration of any payment due to any third party, or cause any third party to be entitled to any statutory payments, or otherwise impair the right of any Acquired Entity or its customers to use the E3 Intellectual Property Rights in the same manner as such E3 Intellectual Property Rights are currently being used by E3 or the customers of any Acquired Entity. (d) All copyrights and, to the knowledge of E3, all patents and registered trademarks, service marks and domain names owned by or issued to any Acquired Entity which relate to any E3 Product are valid and subsisting and no Acquired Entity has received any notice challenging or questioning the validity or effectiveness of any of the foregoing. The manufacturing, marketing, licensing or sale of any E3 Product does not infringe any copyright, proprietary or personal right or, to the knowledge of E3, any patent, trade secret, trademark, trade name, service mark or mask work right of any third party. No Acquired Entity (i) has been sued or named in any suit, action or proceeding which involves a claim of infringement or misappropriation of any patent, trademark, trade name, service mark, copyright, mask work right, trade secret, domain name or other proprietary right of any third party, (ii) has received a notice of any such infringement or misappropriation or (iii) has knowledge of any claim challenging or questioning the validity or effectiveness of any license or agreement relating to any E3 Intellectual Property Rights or to any Licensed Intellectual Property. There is no outstanding order, writ, injunction, decree, judgment or stipulation by or with any court, administrative agency or arbitration panel regarding patent, copyright, trade secret, trademark, trade name, mask work right or other claims relating to the E3 Intellectual Property Rights to which any Acquired Entity is a party or by which any Acquired Entity is bound. (e) All designs, drawings, specifications, source code, object code, documentation, flow charts and diagrams incorporated, embodied or reflected in any E3 Product at any stage of its development were written, developed and created solely and exclusively by (i) Employees of an Acquired Entity (without the assistance of any third party) who have validly waived or otherwise conveyed the benefit of any moral rights thereto to the Acquired Entity or (ii) third parties who assigned ownership of their rights with respect thereto to an Acquired Entity by means of valid and enforceable agreements, which are listed and described in the E3 Disclosure Schedule and copies of which have been made available to JDA. None of the trade secrets of any Acquired Entity have been published or disclosed by any Acquired Entity or, to the knowledge of any Acquired Entity, by any other person, to any person in a manner that would materially jeopardize such information's status as a trade secret, except pursuant to licenses or contracts requiring such other persons to keep such trade secrets confidential. (f) No Acquired Entity is in breach of or in default (including with the passage of time or the giving of notice or both) under any material obligation of any license, 23 28 sublicense, development agreement, manufacturing agreement, distributorship or other similar arrangements relating to the E3 Intellectual Property Rights and, to the knowledge of the E3, no other party to any such arrangements is in breach or default thereof. (g) To the knowledge of E3, no person is infringing on or otherwise violating any right of any Acquired Entity with respect to any E3 Intellectual Property Rights. (h) No Acquired Entity has assigned, sold or otherwise transferred ownership of, or granted an exclusive license or exclusive right to use, any patent, patent application, trademark, mask work right, service mark or domain name. (i) No Acquired Entity or any of its directors, officers, managers or Employees has any patents issued or patent applications pending for any invention of any kind now used or needed by any Acquired Entity in the furtherance of its business operations as currently being conducted by that Acquired Entity, which patents or applications have not been assigned to an Acquired Entity with such assignment duly recorded in the United States Patent Office or with the applicable foreign Governmental Entity. (j) Each person currently or formerly employed by any Acquired Entity (including Consultants and independent contractors, if any) that has or had access to confidential information of any Acquired Entity has executed and delivered to an Acquired Entity a confidentiality and non-disclosure agreement in one of the forms previously provided to JDA. No director, corporate officer (with the title of president or vice president, including the President-Europe), senior legal counsel or senior regional manager of E3 has received notice that the execution or delivery of any such agreement by any such person, or the carrying on by any such person, as an Employee, Consultant or independent contractor, of any Acquired Entity's business as currently conducted and as currently proposed to be conducted, has or will conflict with or result in a breach of the terms, conditions or provisions of, or constitute a default under, any contract, covenant or instrument under which any of such persons is obligated. Schedule 3.9(j) contains a list of all current or former Employees and Consultants who have participated in the development of any E3 Product or E3 Intellectual Property. (k) To E3's knowledge, the E3 Products disclosed on the E3 Disclosure Schedule contain no errors which (i) are unresponsive to remedial actions taken after proper notification and in accordance with the terms of the E3 Product license agreement, during the ordinary course of business and (ii) prevents the E3 Products from operating in any material capacity for an extended period of time. Section 3.10 Bank Accounts. The E3 Disclosure Schedule sets forth the names and locations of all banks and other financial institutions at which any Acquired Entity maintains accounts of any nature, the type of accounts maintained at each such institution and the names of all persons authorized to draw thereon or make withdrawals therefrom. Section 3.11 Contracts. (a) No Acquired Entity is a party or subject to any agreement, obligation or commitment, written or oral: 24 29 (i) that calls for any fixed or contingent payment or expenditure or any related series of fixed or contingent payments or expenditures by or to an Acquired Entity totaling more than $100,000 in the twelve-month period prior to or following the Balance Sheet Date; (ii) with agents, advisors, managers, salesmen, sales representatives, independent contractors or Consultants that are not cancelable by it without liability, penalty or premium on no more than thirty (30) days' notice; (iii) that explicitly restricts any Acquired Entity from carrying on anywhere in the world its business or any portion thereof as currently conducted or from carrying on business of any other sort anywhere in the world; (iv) to provide funds to or to make any investment in any other person or entity other than an Acquired Entity (in the form of a loan, capital contribution or otherwise); (v) with respect to E3's obligations as guarantor, surety, co-signer, endorser, co-maker, indemnitor or otherwise in respect of the obligation of any other person or entity other than an Acquired Entity; (vi) for any line of credit, standby financing, revolving credit or other similar financing arrangement; (vii) with any distributor, original equipment manufacturer, value added remarketer or other person for the distribution of any products of any Acquired Entity; (viii) with any customers that grant such customers a refund right (other than as a remedy for a breach of warranty) on the installation of E3 Products or software, and that the refund period with respect any such installations has not passed, lapsed, expired or terminated; (ix) with any customers that provide the customer with an option to buy monthly user fee in one lump sum rather than pay out their monthly user fee in perpetuity (a list and detail of those customers with such agreements and a list of those customers who have exercised the lump-sum option is set forth on such schedule); (x) with any customers who since January 1, 2001 have elected to pay monthly use fees on an annual basis in exchange for a discount from such fees (a list of any such agreements and any discount amounts for each customer are set forth on such schedule); (xi) with any customers for services that were on a fixed bid basis in excess of $25,000 and have not been completed (a list and description of any incomplete or outstanding arrangements is set forth on such schedule); (xii) with any customers whose agreement with an Acquired Entity contains a "most favored" customer clause; 25 30 (xiii) with any Governmental Entity or involving the provision of products or services to a Governmental Entity; or (xiv) that is otherwise material to the business of any Acquired Entity as currently being conducted, or as currently proposed to be conducted and that is not otherwise listed in Section 3.11(a) of the E3 Disclosure Schedule. (b) To the knowledge of any Acquired Entity, no party to any such contract, agreement or instrument has threatened or given prior written notice of its intention to cancel or withdraw such contract, agreement or instrument. Any such existing contract, agreement or instrument is legal, valid, binding and enforceable and in full force and effect with respect to such Acquired Entity, and to such Acquired Entity's knowledge is legal, valid, binding, enforceable and in full force and effect with respect to each other party thereto, in either case subject to the effect of bankruptcy, insolvency, moratorium or other similar Laws affecting the enforcement of creditors' rights generally and except as the availability of equitable remedies may be limited by general principles of equity and the exercise of judicial discretion in accordance with such principles. Such contracts, agreements or instruments shall continue to be legal, valid, binding and enforceable and in full force and effect immediately following the Closing with respect to each Acquired Entity, and to such Acquired Entity's knowledge is legal, valid, binding, enforceable and in full force and effect with respect to each other party thereto, in either case, in accordance with the terms thereof as in effect prior to the Closing, subject to the effect of bankruptcy, insolvency, moratorium or other similar Laws affecting the enforcement of creditors' rights generally and except as the availability of equitable remedies may be limited by general principles of equity. (c) No Acquired Entity is in material default under or in material breach or violation of, nor is there any valid basis for any claim of material default by any Acquired Entity under, or material breach or violation by any Acquired Entity of, any contract, commitment or restriction to which any Acquired Entity is a party or by which any Acquired Entity or any of its properties or assets is bound or affected. To the knowledge of any Acquired Entity, no other party is in material default under or in material breach or violation of, nor is there any valid basis for any claim of material default by any other party under, or any material breach of violation by any other party of, any contract, commitment, or restriction to which any Acquired Entity is a party or by which any Acquired Entity or any of its properties or assets is bound or affected. Section 3.12 Labor Difficulties. (a) Except as set forth on the E3 Disclosure Schedule, there is no controversy existing, pending or, to the knowledge of E3, threatened with any association, labor union, works council, trade union, collective bargaining representative or other employee representative of the Employees. (b) Except as set forth on the E3 Disclosure Schedule, there is no charge or complaint relating to unfair labor practice pending against any Acquired Entity, or to the knowledge of E3, or threatened before any Governmental Entity, nor is there any strike, slowdown, work stoppage, grievance or other labor dispute pending or, to the knowledge of any Acquired Entity (nor, to the knowledge of any Acquired Entity or the Shareholders, does any 26 31 valid basis for any such complaint exist), threatened against any Acquired Entity. To the knowledge of E3, no Acquired Entity is now or has ever been subject to any union organizing activities, nor has any Acquired Entity experienced any work stoppage or other labor difficulty within the last three (3) years. (c) The E3 Disclosure Schedule sets forth a true and complete list of each works council, labor union, trade union, labor organization or other employee representative which has to be notified or consulted or with which negotiations need to be conducted in connection with the transactions contemplated by this Agreement, and each collective bargaining agreement which has any impact on the terms and conditions of employment with respect to the Employees. (d) Where required by Law, E3 and any Acquired Entity will prior to the Closing Date properly and timely notify, or where appropriate, consult or negotiate with, the works council, labor union, trade union, labor organization, employee representative, labor board or governmental agency concerning the transactions contemplated by this Agreement. Section 3.13 Trade Regulation. Since the Balance Sheet Date, no Acquired Entity has terminated its relationship with or refused to ship any of its products to any dealer, distributor, third party marketing entity or customer which had theretofore paid or been obligated to pay any Acquired Entity in excess of $100,000 over the immediately prior twelve (12) month period. All of the prices charged by any Acquired Entity in connection with the marketing or sale of any of its products or services have been in compliance with all applicable Laws and regulations except where such non-compliance would not have a Material Adverse Effect on E3. No claims have been asserted or, to the knowledge of the Acquired Entity, threatened against E3 with respect to the wrongful termination of any dealer, distributor or any other marketing entity, discriminatory pricing, price fixing, unfair competition, false advertising, or any other violation of any Laws or regulations relating to anti-competitive practices or unfair trade practices of any kind. Section 3.14 Environmental Matters. (a) There are no Environmental Claims pending or, to the knowledge of any Acquired Entity, threatened (i) against any Acquired Entity or (ii) against any real or personal property or operations which any Acquired Entity owns, leases, occupies, possesses or manages, in whole or in part. (b) To the knowledge of E3, there have been no Releases of any Hazardous Material that are reasonably likely to form the basis of any Environmental Claim against any Acquired Entity. (c) At all times, each Acquired Entity has transported, stored, used, manufactured, treated, generated, handled, disposed of or arranged for the disposition of, released or exposed its Employees or others to Hazardous Materials in compliance with all Environmental Laws promulgated by any Governmental Entity except where such non-compliance would not have a Material Adverse Effect on E3. (d) Each Acquired Entity currently holds all Environmental Permits necessary for the conduct of its business as such business is currently being conducted and is in compliance 27 32 with all such Environmental Permits except where such non-compliance would not have a Material Adverse Effect on E3. Except as set forth in the E3 Disclosure Schedule, no environmental report, closure activity, investigation or assessment, and no notification to or Consent from, any Governmental Entity with jurisdiction regarding environmental matters or Hazardous Materials is required to be obtained by any Acquired Entity, either before or after the Effective Time, in connection with any of the transactions contemplated by this Agreement. (e) No Acquired Entity has any knowledge of any Environmental Claim pending or threatened, or of any Release of Hazardous Materials that is reasonably likely to form the basis of any Environmental Claim, in each case against any person or entity (including, without limitation, any predecessor of any Acquired Entity) whose liability any Acquired Entity has or may have retained or assumed either contractually or by operation of Law or against any real or personal property which any Acquired Entity formerly owned, leased or managed, in whole or in part. (f) E3 has made available JDA with copies (or, if not available, accurate written summaries) of all environmental investigations, studies, audits, reviews and other analyses conducted by or on behalf, or which otherwise are in the possession, of any Acquired Entity or any Shareholder respecting any facility, site or other property any Acquired Entity currently owns or operates. (g) No underground storage tanks or underground improvements, including without limitation, treatment or storage tanks, sumps, or water, gas or oil wells are or were present under any property that any Acquired Entity has at any time owned, operated, occupied or leased. (h) To the knowledge of E3, no asbestos or asbestos-containing material, formaldehyde or insulating material containing urea formaldehyde, or material containing polychlorinated biphenyls is present in, on, or at any real property or facility or equipment that any Acquired Entity currently owns, operates, occupies or leases. Section 3.15 Employee Benefit Plans. (a) With respect to each E3 Employee Plan (as hereinafter defined): (i) E3 has set forth in the E3 Disclosure Schedule a complete and accurate list of all material agreements, funds, plans, programs, policies, practices, contracts or other arrangements providing for employment, compensation, retirement, pension, superannuation, profit sharing, deferred compensation, hospitalization, medical, dental, vision, vacation, life insurance, death benefit, sick pay, disability, loans, severance, separation, relocation, repatriation, expatriation, visas, work permits, termination pay, termination indemnity, redundancy pay, performance awards, commissions, bonus, thirteenth month, incentive, stock option, stock purchase, stock bonus, phantom or stock equivalent, stock appreciation right, supplemental retirement, fringe benefits, cafeteria benefits, educational assistance, holiday pay, housing assistance, moving expense reimbursement or other benefits, whether written or unwritten, including, without limitation, each "employee benefit plan" within the meaning of Section 3(3) of ERISA which is or has been sponsored, maintained, contributed 28 33 to, or required to be contributed to by E3, any E3 Subsidiary or any ERISA Affiliate for the benefit of any person who performs or who has performed services for E3 or with respect to which E3, any E3 Subsidiary or ERISA Affiliate has or may have any liability (including, without limitation, contingent liability) or obligation, regardless of whether it is voluntary, private, funded, unfunded, financed by the purchase of insurance, contributory or non-contributory (each an "E3 EMPLOYEE PLAN" and collectively, "E3 EMPLOYEE PLANS"); provided, however, that any governmental plan or program requiring mandatory payment of social insurance taxes or similar contributions to a governmental fund with respect to the wages of an Employee and any plan or program that may be mandated by local Law shall not be considered an "E3 Employee Plan" for these purposes. An E3 Employee Plan adopted or maintained, whether formally or informally, for the benefit of Employees in the United States is hereinafter referred to as a "E3 U.S. EMPLOYEE PLAN." An E3 Employee Plan adopted or maintained, whether formally or informally, for the benefit of Employees outside the United States is hereinafter referred to as a "E3 INTERNATIONAL EMPLOYEE PLAN." There has been no amendment to, written interpretation or announcement by E3, any E3 Subsidiary or ERISA Affiliate which would materially increase the expense of maintaining any E3 Employee Plan above the level of expense incurred with respect to that plan for the most recent fiscal year included in the plan sponsor's financial statements. (ii) Each E3 Employee Plan and any plan or program that may be mandated under local Law has been established and administered in accordance with its terms and in material compliance with the requirements prescribed by any and all statutes, rules and regulations. (iii) As of the Closing Date, no E3 Employee Plan and any plan or program that may be mandated under local Law has any unfunded liability. As of the Closing Date, the Benefit Obligations under each E3 Employee Plan will be (A) appropriately reflected on the Closing Balance Sheet in accordance with GAAP and (B) appropriately reflected on the E3 Financial Statements (or the financial statements of any other E3 Employee Plan sponsor) in accordance with local Law, past practice and generally accepted accounting principles in each applicable jurisdiction. Any E3 Employee Plan that is sponsored by any Acquired Entity as of the Closing Date will own assets (including cash or insurance contracts) with a fair market value, as of the Closing Date, equal to or greater than the Benefit Obligations under such plan as of the Closing Date. (b) No Acquired Entity is a party to any oral or written (i) agreement with any officer or other key Employee of any Acquired Entity, the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of a transaction involving any Acquired Entity of the nature contemplated by this Agreement, (ii) agreement with any officer of any Acquired Entity providing any term of employment or compensation guarantee or for the payment of compensation in excess of $100,000 per annum, or (iii) agreement or plan, including any stock option plan, stock appreciation right plan, restricted stock plan or stock purchase plan, any of the benefits of which will be increased, or the vesting of the benefits of which will be accelerated, by the occurrence of any of the transactions contemplated by this Agreement or the value of any of the benefits of which will be calculated on the basis of any of the transactions contemplated by this Agreement. 29 34 (c) With respect to each E3 U.S. Employee Plan: (i) E3 has furnished to JDA true and complete copies of documents embodying each E3 U.S. Employee Plan and related plan documents, including (to the extent applicable) the most recent determination or opinion letter, trust documents, group annuity contracts, plan amendments, insurance policies or contracts, participant agreements, employee booklets, administrative service agreements, summary plan descriptions, summary of material modifications, compliance and nondiscrimination tests for the last three plan years, Form 5500 reports filed for the last three plan years, standard COBRA forms and related notices, and registration statements and prospectuses. (ii) (1) E3 has, to the extent applicable, either obtained from the Internal Revenue Service a favorable determination or opinion letter as to its qualified status under the Code, including Section 4975(e)(7) of the Code, if applicable, and all amendments to the Code which are currently effective, or has time remaining to apply under applicable regulations or pronouncements for a determination or opinion letter and to make any amendments necessary to obtain a favorable determination or opinion letter; (2) none of the E3 U.S. Employee Plans promises or provides retiree medical or other retiree welfare benefits to any person (other than COBRA continuation coverage); (3) there has been no "prohibited transaction," as such term is defined in Section 406 of ERISA or Section 4975 of the Code, with respect to any E3 U.S. Employee Plan: (4) none of E3, any Subsidiary or any ERISA Affiliate is subject to any liability or penalty under Sections 4976 through 4980 of the Code or Title I of ERISA; (5) all contributions required to be made by E3, any Subsidiary or ERISA Affiliate to any E3 U.S. Employee Plan have been timely paid or accrued; (6) each E3 U.S. Employee Plan has timely filed all requisite governmental reports (which were true and correct as of the date filed) and has properly and timely filed and distributed or posted all required notices and reports to Employees; and (7) no suit, administrative proceeding, action or other litigation has been brought, or to the knowledge of E3 is threatened, against or with respect to any such E3 U.S. Employee Plan, including any audit or inquiry by the IRS or United States Department of Labor. (iii) None of E3, any Subsidiary or any ERISA Affiliate has ever maintained, established, sponsored, participated in, contributed to, or is obligated to contribute to, or otherwise incurred any obligation or liability (including, without limitation, any contingent liability) under any "multiemployer plan" (as defined in Section 3(37) of ERISA) or to any "pension plan" (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA or Section 412 of the Code. None of E3, any Subsidiary or any ERISA Affiliate has any actual or potential withdrawal liability (including, without limitation, any contingent liability) for any complete or partial withdrawal (as defined in Sections 4203 and 4205 of ERISA) from any multiemployer plan. (iv) With respect to each E3 U.S. Employee Plan, E3 and each of its United States Subsidiaries have complied in all material respects with and have no unsatisfied obligations (other than obligations that can only be satisfied under applicable law with the passage of time) under (1) the applicable health care continuation and notice provisions of COBRA and the regulations thereunder or any state Law governing health care coverage extension or continuation; (2) the applicable requirements of the Family and Medical Leave Act of 1993 and the regulations thereunder; (3) the applicable requirements of the Health Insurance 30 35 Portability and Accountability Act of 1996; and (4) the applicable requirements of the Cancer Rights Act of 1998. (v) No benefit payable or which may become payable by E3 pursuant to any E3 U.S. Employee Plan or as a result of or arising under this Agreement shall constitute an "excess parachute payment" (as defined in Section 280G(b)(1) of the Code) which is subject to the imposition of an excise Tax under Section 4999 of the Code or the deduction for which would be disallowed by reason of Section 280G of the Code. Each E3 U.S. Employee Plan can be amended, terminated or otherwise discontinued after the Effective Time in accordance with its terms, without material liability to JDA or E3 (other than ordinary administration expenses typically incurred in a termination event). (d) With respect to each E3 International Employee Plan, E3 has furnished to JDA true and complete copies of documents embodying each E3 International Employee Plan and related plan documents, including (without limitation) the most recent actuarial estimates of liabilities, audited financial statements for each E3 International Employee Plan for the last three years, trust documents, group annuity contracts, plan amendments, insurance policies or contracts, participant agreements, employee booklets, administrative service agreements, summary plan descriptions, registration statements and prospectuses. Except as required by Law, no condition exists that would prevent E3 or JDA from terminating or amending any E3 International Employee Plan at any time for any reason. Section 3.16 Compliance with Laws. Each Acquired Entity has complied with, is not in violation of, and has not received any notices of violation with respect to, any Law applicable to the ownership or operation of its business except for violations or other instances of non-compliance which would not have a Material Adverse Effect on E3. Section 3.17 Employees and Consultants. (a) The E3 Disclosure Schedule contains a complete and accurate list of the names of all Employees and Consultants of each Acquired Entity as of the date of this Agreement and their salaries or wages, other compensation, dates of employment/service and positions. (b) Prior to the Closing, E3 has made available to JDA correct and complete copies of all contracts, agreements, plans, and commitments with respect to all Employees pertaining to terms of employment, compensation, bonuses, profit sharing, securities purchases, securities repurchases, options, deferred compensation arrangements or plans, commissions, incentives, loans or loan guarantees, severance pay or benefits, use of company property, noncompetition and other restrictive covenants, and related matters. Schedule 3.17(b) contains a list of all such contracts, agreements, plans and commitments. E3 and each Acquired Entity is in material compliance with and not in violation of any agreements and/or arrangements with any Employee or Consultant. (c) E3 and each Acquired Entity are in material compliance with respect to its Employees and Consultants with all currently applicable Laws and its own policies with respect to or affecting employment, employment practices, discrimination in employment, terms and 31 36 conditions of employment, wages, hours and occupational safety and health and employment practices, equal opportunity, civil rights, labor relations, payroll taxes, any federal, state, provincial or local human rights act and immigration and are not engaged in any unfair labor practice. Neither E3 nor any Acquired Entity has received any written notice from any Governmental Entity and, to the knowledge of E3 or any Acquired Entity, there has not been asserted before any Governmental Entity, any current claim, action or proceeding to which E3 or any Acquired Entity is a party relating to the Employees and there is neither pending nor, to the knowledge of E3 or any Acquired Entity, has there been threatened in writing, any investigation or hearing to which E3 or any Acquired Entity is a party relating to the Employees of E3 or any Acquired Entity arising out of or based upon any such Laws. There is no pending claim against E3 or any Acquired Entity relating to the Employees of E3 or any Acquired Entity under any workers' compensation plan or statute. (d) To the knowledge of E3, a sufficient number of Employees with software development responsibilities have not expressed to a director, corporate officer (with a title of president or vice president, including President-Europe), the senior legal counsel or senior regional manager their firm intention to leave their employment such that their departure would collectively have an Material Adverse Effect on E3. (e) Except as set forth on the E3 Disclosure Schedule, there is no employment agreement in force between any Acquired Entity and any of their respective directors, managers or officers which is not terminable by the appropriate Acquired Entity without compensation on less than three months' notice given at any time. Except as set forth on the E3 Disclosure Schedule, there are no material consultancy or management services agreements in existence between any Acquired Entity and any other person, firm or company, and there are no material collective bargaining agreements between any Acquired Entity or any employers or trade association of which the Acquired Entity is a member and any trade union, staff association or other body representing Employees or a substantial number of them. E3 has made available to JDA correct and complete copies of each agreement listed on the E3 Disclosure Schedule, each as amended to date. Each such agreement is legal, valid and binding on the applicable Acquired Entity and, to E3's knowledge, the other party or parties thereto. The terms of all such agreements have been complied with in all material respects by the applicable Acquired Entity and, to E3's knowledge, by the other parties to such agreements. No event, occurrence or condition exists that, with the lapse of time, the giving of notice, or both, would become a default under any such agreement by any Acquired Entity or, to E3's knowledge. Section 3.18 Litigation. There is no action, suit, proceeding, claim, arbitration or investigation pending before any agency, court or tribunal or, to the knowledge of any Acquired Entity, threatened against any Acquired Entity or any of its properties or officers, managers or directors (in their capacities as such). There is no judgment, decree or order against any Acquired Entity or, to the knowledge of any Acquired Entity, any of its officers, managers or directors (in their capacities as such) that could reasonably be expected to prevent, enjoin or materially alter or delay any of the transactions contemplated by this Agreement, or that could reasonably be expected to have a Material Adverse Effect on E3. All litigation to which any Acquired Entity is a party (or, to the knowledge of any Acquired Entity, threatened to become a party) is disclosed in the E3 Disclosure Schedule. 32 37 Section 3.19 Restrictions on Business Activities. There is no agreement, judgment, injunction, order, decree or proceeding of, by or with any Governmental Entities binding upon any Acquired Entity which has or could reasonably be expected to have the effect of prohibiting or materially impairing any current business practice of any Acquired Entity, any acquisition of property by any Acquired Entity or the conduct of business by any Acquired Entity as currently being conducted or as currently proposed to be conducted. Section 3.20 Governmental Authorization. Each Acquired Entity has obtained each governmental Consent, license, grant or other authorization of a Governmental Entity that is required for the operation of the business of that Acquired Entity, including with respect to government subsidies, customer tax exemptions, holidays and the like other than authorizations that would not have a Material Adverse Effect on E3 (collectively, the "E3 AUTHORIZATIONS"), and all of such E3 Authorizations are in full force and effect. E3 has provided JDA with a complete written list of all E3 Authorizations. No Acquired Entity nor, to the knowledge of any Acquired Entity, any Employee of any Acquired Entity has received any notice from a Governmental Entity of its intention to cancel, terminate or not renew any E3 Authorization and no E3 Authorization will be lost or adversely impacted as a result of the consummation of the transaction under this Agreement. Section 3.21 Insurance. The E3 Disclosure Schedule contains a list of all insurance policies of the Acquired Entities. There is no material claim pending under any of such policies as to which coverage has been questioned, denied or disputed by the underwriters of such policies. All premiums due and payable under all policies currently in force or issued in the past have been paid, and each Acquired Entity is otherwise in material compliance with the terms of such policies. No Acquired Entity has any knowledge of any threatened termination of, or material premium increase with respect to, any of such policies. No policy currently in force or issued to any Acquired Entity in the past is subject to any retrospective rating or retrospective premium provision, premium recapture provision, or similar provision. Section 3.22 Interested Party Transactions. (a) No director, officer or ten percent (10%) Shareholder of any Acquired Entity has any interest in (i) any equipment or other property or asset, real or personal, tangible or intangible, including, without limitation, any of the E3 Intellectual Property Rights, used in connection with or pertaining to the business of any Acquired Entity, (ii) any creditor, supplier, customer, manufacturer, agent, representative, or distributor of any of the products of any Acquired Entity, (iii) any entity that competes with any Acquired Entity, or with which any Acquired Entity is affiliated or has a business relationship, or (iv) any agreement, obligation or commitment, written or oral, to which any Acquired Entity is a party; provided, however, that no such person shall be deemed to have such an interest solely by virtue of ownership of less than one percent (1%) of the outstanding stock or debt securities of any company whose stock or debt securities are traded on a recognized stock exchange or quoted on NASDAQ. (b) Except as contemplated by the Transaction Documents or otherwise set forth in the E3 Disclosure Schedule, no Acquired Entity is (i) a party to any agreement with any director, officer, manager or other Employee of any Acquired Entity the benefits of which are contingent, or the terms of which would be materially altered, upon the occurrence of the 33 38 transactions contemplated by this Agreement, (ii) a party to any agreement or plan, including, without limitation, any stock option plan, stock appreciation right plan or stock purchase plan, any of the benefits of which will be increased, or the vesting of benefits of which will be accelerated, by the occurrence of any of the transactions contemplated by this Agreement or the value of any of the benefits of which will be calculated on the basis of any of the transactions contemplated by this Agreement, (iii) indebted to any director, officer, senior regional manager or ten percent (10%) Shareholder of any Acquired Entity (except for amount due as normal salaries and bonuses and in reimbursement of ordinary expenses), or (iv) a party to any agreement or arrangement for the loan of money to any director, officer, senior regional manager or ten percent (10%) Shareholder of any Acquired Entity. Section 3.23 No Existing Discussions. To the extent that E3 or any Acquired Entity is in discussions with a third party with respect to a private equity financing, E3 or the Acquired Entity has the legal right to terminate or suspend any such pending negotiations. Section 3.24 Real Property Holding Corporation. No Acquired Entity is, or has been, a "United States real property holding corporation" within the meaning of Section 897(c)(2) of the Code during the applicable period specified in Section 897(c)(1)(A)(ii) of the Code. Section 3.25 Corporate Documents. Each Acquired Entity has made available to JDA, or its representatives, for its examination (i) its minute book and other corporate records, in accordance with local Law, containing all records required to be set forth of all proceedings, consents, actions, and meetings of the shareholders or equity holders, the Board of Directors or other relevant management body and any committees thereof, (ii) its stock register, equity register or local Law equivalent evidencing the ownership interests in the Acquired Equity, and (iii) all Consents issued by any Governmental Entity with respect to that Acquired Entity (together, the "CORPORATE DOCUMENTS"). The Corporate Documents are complete and accurate in all material respects, and the signatures appearing on all documents contained therein are the true signatures of the persons purporting to have signed the same. All actions reflected in the Corporate Documents were duly and validly taken in compliance with the Laws of the applicable jurisdiction. E3 has made available to JDA or its representatives true and complete copies of all documents which are referred to in the E3 Disclosure Schedule. Section 3.26 Aliens. All Employees in the United States of the Acquired Entities are, to the knowledge of E3 (including any constructive knowledge the IRCA may deem E3 to have), (i) citizens of the United States or (ii) not citizens of the United States, but, in accordance with the IRCA and other applicable federal governmental requirements, are either (A) immigrants authorized to work in the United States or (B) nonimmigrants authorized to work in the United States for E3 in their specific jobs. Since November 6, 1986 no Acquired Entity has (i) hired (or by reason of any contract, subcontract or exchange is considered for purposes of the IRCA to have hired) an alien in the United States to perform labor or services in the United States with knowledge (as determined in accordance with the IRCA) that the alien is an unauthorized alien with respect to performing that labor or those services, (ii) continued the employment of any Employee hired after November 6, 1986 with knowledge (as determined in accordance with the IRCA) that the Employee is or has become an unauthorized alien with respect to that employment or (iii) directly or indirectly in violation of the IRCA required any individual it has hired to post a bond or security or provide any other financial assurance to it against any 34 39 potential liability under the IRCA as a result of that hire. E3 has provided JDA with a true, complete list of all current alien Employees of the Acquired Entities who (i) are authorized to work in the United States as immigrants or (ii) hold H-1B, H-2B or other nonimmigrant visas. E3 has made available to JDA with respect to each current Employee of the Acquired Entities who has an H-1B or H-2B visa, true, complete copies of the Department of Labor File and Public Access File the Acquired Entities have maintained with respect to that Employee. E3 also has made available to JDA true, complete copies of all Forms I-9 the Acquired Entities possess with respect to their (i) current Employees, (ii) former Employees whose employment was terminated within 12 months of the date hereof and who were employed for more than 36 months and (iii) former Employees whose employment was terminated within 36 months of the date hereof and who were employed for less than 36 months. Each Acquired Entity has obtained, completed and maintained Form I-9s in accordance with, and has otherwise complied with the record-keeping requirements of, the IRCA. Section 3.27 Indemnification Claims. The E3 Disclosure Schedules sets forth a list of all persons who are parties to director, officer and/or employee indemnification agreements with E3 or the Subsidiaries. Except as set forth in the E3 Disclosure Schedules, there are no outstanding claims under any of such indemnification agreements or under any indemnification rights granted pursuant to the Articles of Incorporation, Bylaws or other charter documents of E3 or the E3 Subsidiaries (as currently in effect); and, to E3's knowledge, there are no facts or circumstances that either now, or with the passage of time, would reasonably be expected to provide a basis for a claim under any such indemnification agreement or under any indemnification rights granted pursuant to the Certificate of Incorporation, Bylaws or other charter documents of E3 or the E3 Subsidiaries. Section 3.28 Power of Attorney. Neither E3 nor any of the E3 Subsidiaries has granted to any person a power of attorney or similar authorization of a material nature that is currently in effect of authority. Section 3.29 No Misrepresentation. No representation or warranty by any Acquired Entity in this Agreement, or any document, exhibit, statement, certificate or Schedule furnished or to be furnished by or on behalf of any Acquired Entity pursuant to this Agreement, when taken together, contains or shall contain any untrue or incorrect statement of a material fact or omits or shall omit to state a material fact required to be stated therein or necessary in order to make such statements, in light of the circumstances under which they were made, not misleading. ARTICLE IIIA REPRESENTATIONS AND WARRANTIES OF EACH SIGNING SHAREHOLDER Except as disclosed in the E3 Disclosure Schedule, each of the Signing Shareholders represents and warrants, as applied solely to himself, as follows: Section 3A.1 Ownership and Status of E3 Common Stock. The Signing Shareholder is the record and beneficial owner of the number of shares of E3 Common Stock set forth opposite the Shareholder's name in the E3 Disclosure Schedule, free and clear of all Liens. 35 40 Section 3A.2 Power of the Signing Shareholder; Approval of the Merger. (a) The Signing Shareholder has the requisite power, legal capacity and authority to execute and deliver this Agreement and each other Transaction Document to which the Signing Shareholder is a party and to perform the Signing Shareholder's obligations in this Agreement and in all other Transaction Documents to which the Signing Shareholder is a party. This Agreement constitutes, and each such other Transaction Document, when executed in the Signing Shareholder's individual capacity and delivered by the Signing Shareholder, will constitute, the legal, valid and binding obligation of the Signing Shareholder, enforceable against the Signing Shareholder in accordance with its terms, except as that enforceability may be (i) limited by an applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar Laws affecting the enforcement of creditors' rights generally or any applicable Law that limits rights to indemnification and (ii) subject to general principles of equity (regardless of whether that enforceability is considered in a proceeding in equity or at Law). (b) The Signing Shareholder, acting in each capacity in which he is entitled, by reason of E3's charter documents or the Laws of E3's state of organization or for any other reason, to vote to approve or disapprove the consummation of the Merger, has voted all the shares of E3 Common Stock owned by him and entitled to a vote or votes on that matter, in any one or more of the manners prescribed or permitted by E3's charter documents or the Laws of E3's state of organization, whichever are controlling, to approve and adopt this Agreement and to approve the Merger and the other transactions contemplated by this Agreement or by any of the other Transaction Documents. Section 3A.3 No Conflicts or Litigation. The Signing Shareholder's execution, delivery and performance in accordance with their respective terms of this Agreement and the other Transaction Documents to which the Signing Shareholder is a party do not and will not (i) violate or conflict with any Law, (ii) breach or constitute a default under any agreement or instrument to which the Signing Shareholder is a party or by which the Shareholder or any shares of E3 Common Stock the Signing Shareholder owns is bound, or (iii) result in the creation or imposition of, or afford any person the right to obtain, any Lien upon any shares of E3 Common Stock the Signing Shareholder owns (or upon any revenues, income or profits of the Signing Shareholder therefrom). No action, suit, proceeding, claim, arbitration or investigation is pending or, to the knowledge of the Signing Shareholder, threatened to which the Signing Shareholder is or may reasonably be expected to become a party which (i) questions or involves the validity or enforceability of any of the Signing Shareholder's obligations under any Transaction Document or (ii) seeks (or reasonably may be expected to seek) (A) to prevent or delay the consummation by the Signing Shareholder of the transactions this Agreement contemplates the Signing Shareholder will consummate or (B) damages in connection with any such consummation. Section 3A.4 Preemptive and Other Rights; Waiver. Except for the right of the Signing Shareholder to receive shares of JDA Common Stock constituting the Stock Merger Consideration as a result of the Merger, the Signing Shareholder either (i) does not own or otherwise have any statutory or contractual preemptive or other right of any kind (including any right of first offer or refusal) to acquire any shares of E3 Common Stock or JDA Common Stock 36 41 or (ii) hereby irrevocably waives each right of that type the Signing Shareholder does own or otherwise has. Section 3A.5 Accredited Investor Status; Sophistication. The Signing Shareholder (i) will be acquiring the shares of JDA Common Stock to be issued to him pursuant to this Agreement solely for his account, for investment purposes only and with no current intention or plan to distribute, sell or otherwise dispose of any of those shares in connection with any distribution and (ii) is not a party to any agreement or other arrangement for the disposition of any shares of JDA Common Stock other than this Agreement. The Signing Shareholder is an "accredited investor" as defined in Securities Act Rule 501(a). The Signing Shareholder (i) is able to bear the economic risk of an investment in the JDA Common Stock acquired pursuant to this Agreement, (ii) can afford to sustain a total loss of that investment, (iii) has such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the proposed investment in the JDA Common Stock and (iv) has had an adequate opportunity to ask questions and receive answers from the officers of JDA concerning any and all matters relating to the transactions contemplated hereby and thereby including the background and experience of the current and proposed officers and directors of JDA, and the plans for the business and operation of JDA. ARTICLE IV REPRESENTATIONS AND WARRANTIES OF JDA AND SUB Except as set forth in the JDA Disclosure Schedule, JDA and Sub represent and warrant to E3 as follows: Section 4.1 Organization. Each of JDA and Sub is a corporation duly organized, validly existing and in good standing (or its local Law equivalent, as applicable) under the Laws of the jurisdiction of its organization, has all requisite corporate power to own, lease and operate its property and to carry on its business as now being conducted and as proposed to be conducted, and is duly qualified to transact business and is in good standing as a foreign corporation in each jurisdiction in which the failure to be so qualified would have a Material Adverse Effect on JDA. Section 4.2 JDA Capital Structure. (a) The authorized capital stock of JDA consists of 50,000,000 shares of JDA Common Stock and 2,000,000 shares of Preferred Stock, $1.00 par value, of which 500,000 shares of have been designated Series A Preferred Stock. As of August 10, 2001, 24,840,977 shares of JDA Common Stock and no shares of JDA Series A Preferred Stock were issued and outstanding, all of which had been duly authorized and validly issued and were fully paid and nonassessable. No material change in such capitalization has occurred between August 10, 2001 and the date of this Agreement. All of the outstanding shares of capital stock of Sub have been duly authorized and validly issued and are fully paid and nonassessable, and all such shares are owned by JDA, free and clear of all Liens. The authorized capital stock of Sub consists of 100,000 shares of common stock, par value $0.001 per share, all of which are issued and outstanding and owned by JDA. 37 42 (b) The shares of JDA Common Stock to be issued pursuant to the Merger, when issued in accordance with the terms of this Agreement, will be (i) duly authorized, validly issued, fully paid and nonassessable, (ii) free and clear of any security interests, pledges, mortgages, claims, Liens and encumbrances of any kind whatsoever and (iii) assuming the truth and accuracy of the statements, representations and warranties made by the Shareholders to JDA in connection therewith, will be issued in compliance with all applicable federal and state securities laws. Section 4.3 Authority; No Conflict; Required Filings and Consents. (a) JDA and Sub have all requisite corporate power and authority to execute and deliver this Agreement and the other Transaction Documents to which they are or will be parties and to consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the other Transaction Documents to which JDA or Sub is or will be a party and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of JDA and Sub, respectively. This Agreement has been, and the other Transaction Documents to which JDA and/or Sub are parties have been or will be when they are executed by JDA and/or Sub, as applicable, duly executed and delivered by JDA and/or Sub and constitute, or will constitute when they are executed by E3 and/or Sub, as applicable, the valid and binding obligations of JDA and/or Sub, enforceable against JDA and/or Sub, as the case may be, in accordance with their respective terms, except as such enforceability may be limited by (i) bankruptcy Laws and other similar Laws affecting creditors' rights generally and (ii) general principles of equity. (b) The execution and delivery by JDA and Sub of this Agreement and the other Transaction Documents to which they are or will be parties do not, and the consummation of the transactions contemplated hereby and thereby will not, (i) conflict with, or result in any violation or breach of any provision of the Certificate of Incorporation or Bylaws of JDA or Sub, (ii) result in any violation or breach of, or constitute (with or without notice or lapse of time, or both) a default under, or give rise to a right of termination, cancellation or acceleration of any material obligation or loss of any material benefit under, any note, mortgage, indenture, lease, contract or other agreement, instrument or obligation to which JDA or Sub is a party or by which either of them or any of their properties or assets may be bound, or (iii) conflict with or violate any permit, concession, franchise, license, judgment or Law, applicable to JDA or Sub or any of its or their properties or assets, except in the case of (ii) and (iii) for any such conflicts, violations, defaults, terminations, cancellations or accelerations which would not be reasonably likely to have a Material Adverse Effect on JDA. (c) No Consent from any Governmental Entity is required by or with respect to JDA or any of its Subsidiaries in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except for (i) the filing of a pre-merger notification and report forms by E3 and JDA and, if required, by some or all of the Shareholders, under the HSR Act, (ii) the filing of the Certificate of Merger with the Delaware Secretary of State, (iii) if required, the filing of a report on Form 8-K with the SEC, (iv) such Consents as may be required under applicable federal and state securities Laws in the United States and the securities Laws of other relevant jurisdictions, and (v) such other Consents which, if not obtained or made, would not prevent or materially alter or delay any of the 38 43 transactions contemplated by this Agreement or be reasonably likely to have a Material Adverse Effect on JDA. Section 4.4 SEC Filings; Financial Statements. (a) JDA has timely filed all JDA SEC Reports. Each of the JDA SEC Reports (i) at the time it was filed, complied in all material respects with the applicable requirements of the Exchange Act, as the case may be, and (ii) did not at the time it was filed (or if amended or superseded by a filing prior to the date of this Agreement, then on the date of such filing) contain any untrue statement of a material fact or omit to state a material fact required to be stated in such JDA SEC Report or necessary in order to make the statements in such JDA SEC Report, in the light of the circumstances under which they were made, not misleading. (b) Each of the consolidated financial statements (including, in each case, any related notes) contained in the JDA SEC Reports, including any JDA SEC Reports filed after the date of this Agreement until the Closing, complied or when filed will comply as to form in all material respects with the applicable published rules and regulations of the SEC with respect thereto, was or will be prepared in accordance with GAAP applied on a consistent basis throughout the periods involved (except as may be indicated in the notes to such financial statements or, in the case of unaudited statements, as permitted by Form 10-Q promulgated by the SEC) and presented fairly or when filed will present fairly, in all material respects, the consolidated financial position of JDA and its Subsidiaries as of the respective dates, and the consolidated results of its operations and cash flows for the periods indicated, except that the unaudited interim financial statements were or when filed are subject to normal and recurring year-end adjustments which were not or are not expected to be material in amount. Section 4.5 Absence of Undisclosed Liabilities. JDA does not have any liabilities of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise, (whether or not required to be reflected in financial statements in accordance with GAAP), and whether due or to become due, which individually or in the aggregate would be reasonably likely to have a Material Adverse Effect on JDA, other than (i) liabilities reflected or provided for on the JDA Balance Sheet, (ii) liabilities specifically contemplated by this Agreement, or described in the JDA SEC Reports, and (iii) normal or recurring liabilities incurred since the date of the JDA Balance Sheet, in the ordinary course of business consistent with past practices. Section 4.6 Absence of Certain Changes or Events. Since the date of the JDA Balance Sheet, JDA has not suffered any event or occurrence that has had, or is reasonably likely to have, a Material Adverse Effect on JDA or that would require JDA to file with the SEC a current report on Form 8-K or amend any prior filing made by JDA with the SEC. Section 4.7 Litigation. Except as described in the JDA SEC Reports, if any, there is no action, suit or proceeding, claim, arbitration or investigation against JDA pending or as to which JDA has received any written notice of assertion, which is reasonably likely to have a Material Adverse Effect on JDA or a material adverse effect on the ability of JDA to consummate the transactions contemplated by this Agreement. 39 44 Section 4.8 Board Approval and Recommendation. On or prior to the date hereof, the board of directors of JDA has (i) determined that the Merger is advisable to and in the best interests of JDA, and (ii) approved this Agreement and the transactions contemplated hereby, including the Merger. Section 4.9 Tax Treatment. Neither JDA nor any of its Subsidiaries has taken, proposes to take, or has agreed to take action that would prevent the Merger from constituting a reorganization qualifying under the provisions of Section 368(a) of the Code. Section 4.10 No Prior Activities. Except for obligations incurred in connection with its incorporation or organization or the negotiation or consummation of this Agreement and the transactions contemplated hereby, Sub has neither incurred any obligation or liability nor engaged in any business or activity of a type or kind or entered into any agreement or arrangement with any person. ARTICLE V CONDUCT OF BUSINESS [INTENTIONALLY DELETED] ARTICLE VI ADDITIONAL AGREEMENTS (a) No Solicitation. Intentionally Deleted. Section 6.2 Access to Information. Intentionally Deleted. Section 6.3 Legal Conditions to Merger. Each of JDA, E3 and the E3 Subsidiaries will take all reasonable actions necessary to comply promptly with all legal requirements which may be imposed on itself with respect to the Merger (which actions shall include, without limitation, furnishing all information in connection with approvals of or filings with any Governmental Entity) and will promptly cooperate with and furnish information to each other in connection with any such requirements imposed upon either of them or any of their Subsidiaries in connection with the Merger. Each of JDA and E3 will take all reasonable actions necessary to obtain (and will cooperate with each other in obtaining) any Consent, or any exemption by, any Governmental Entity or other third party, required to be obtained or made by E3, JDA or any of their Subsidiaries in connection with the Merger or the taking of any action contemplated thereby or by this Agreement and to enable the Closing to occur as promptly as practicable. Section 6.4 Public Disclosure. JDA and E3 shall consult with each other before issuing any press release or otherwise making any public statement with respect to the Merger or this Agreement and shall not issue any such press release or make any such public statement prior to such consultation. Section 6.5 Tax-Free Reorganization. JDA and E3 each intend that the Merger shall qualify for treatment as a reorganization within the meaning of Section 368(a) of the Code. JDA 40 45 and E3 each agree to refrain from taking any action inconsistent with such intended treatment. JDA and E3 agree to make reasonable representations substantially in the form of the tax certificates attached hereto as Exhibits F and G, as requested by counsel to JDA and E3 with respect to the rendering of the opinions required pursuant to Section 7.1(d). Section 6.6 E3 401(k) Plan. E3 agrees to terminate its 401(k) plan effective as of the day immediately preceding the Closing Date. Unless Sub provides such notice, E3 shall deliver to Sub evidence that E3's 401(k) plan has been terminated effective as of the day immediately preceding the Closing Date pursuant to resolutions of E3's Board of Directors (the form and substance of which resolutions shall be subject to review and approval of JDA), effective as of the day immediately preceding the Closing Date. Section 6.7 Brokers or Finders. E3 represents, as to itself, the E3 Subsidiaries and its Affiliates, and each Signing Shareholder represents, as to himself, that, except as set forth in Schedule 6.7, no agent, broker, investment banker, financial advisor or other firm or person is or will be entitled to any broker's or finder's fee or any other commission or similar fee in connection with any of the transactions contemplated by this Agreement, and the Signing Shareholders agree jointly and severally to indemnify and hold JDA and E3 harmless from and against any and all claims, liabilities or obligations with respect to any other fees, commissions or expenses not set forth in Schedule 6.7 asserted by any person including First Union Securities, Inc., financial advisor to E3, on the basis of any act, statement or agreement made or alleged to have been made by E3, any Subsidiary or Affiliate of E3, or any Signing Shareholder. Section 6.8 Additional Agreements; Reasonable Efforts. Subject to the terms and conditions of this Agreement, each of the parties agrees to use their commercially reasonable efforts to take, or cause to be taken, all action and to do, or cause to be done, all things necessary, proper or advisable under applicable Laws and regulations to consummate and make effective the transactions contemplated by this Agreement, including cooperating fully with the other party, including by provision of information. In case at any time after the Effective Time any further action is necessary or desirable to carry out the purposes of this Agreement or to vest the Surviving Corporation with full title to all properties, assets, rights, approvals, immunities and franchises of either of the Constituent Corporations, the proper officers and directors of each party to this Agreement shall take all such necessary action. Section 6.9 Expenses. The parties shall each pay their own legal, accounting, financial advisory and consulting fees and other out-of-pocket expenses related to the negotiation, preparation and carrying out of this Agreement and the transactions herein contemplated. In the event the Merger is consummated, all (i) Taxes applicable to the transfer of E3 Common Stock and the equity or other ownership interests of the E3's Subsidiaries, as contemplated by this Agreement; and (ii) legal, accounting, financial advisory and consulting fees and expenses incurred by E3 on behalf of itself or the Shareholders (whether paid or accrued), including those referred to in Section 6.7, relating to the negotiation, preparation and carrying out of this Agreement and the transactions contemplated hereby through the Closing Date, and obtaining all Consents from Governmental Entities in connection with such transactions (the "E3 TRANSACTION EXPENSES") shall become the liabilities of the Surviving Corporation as a result of the Merger. E3 shall provide an updated Schedule of Estimated E3 Transaction Expenses not later than two (2) business days prior to the Closing (the "CLOSING E3 TRANSACTION EXPENSE SCHEDULE"). The 41 46 amount of E3 Transaction Expenses set forth on the Closing E3 Transaction Expense Schedule shall be used to calculate the Cash Merger Consideration. In the event the E3 Transaction Expenses actually incurred by E3 include Excess E3 Transaction Expenses, JDA shall be entitled to assert a claim against the Escrowed Cash pursuant to Article IX hereof (without regard to the Floor Amount) in order to recover all such additional expenses, but only to the extent such amounts have not been reflected in the calculation of the Merger Consideration paid at Closing. Section 6.10 Updating Schedules. Intentionally Deleted. Section 6.11 Directors and Officers of Subsidiaries. The parties agree that the directors, officers and managers of the Subsidiaries of the Surviving Corporation immediately after the Closing shall be as set forth on Schedule 1.4, and the parties agree to take or cause to be taken all actions necessary to elect or nominate and qualify such persons for such offices or directorships. ARTICLE VII CONDITIONS TO MERGER Section 7.1 Conditions to Each Party's Obligation to Effect the Merger. The respective obligations of each party to this Agreement to effect the Merger shall be subject to the satisfaction on or prior to the Closing Date of the following conditions: (a) HSR Period. The waiting period (and any extension thereof) applicable to the Merger under the HSR Act shall have been terminated or shall have expired. (b) Governmental Approvals. All Consents, or expirations of waiting periods imposed by, any Governmental Entity the failure of which to obtain or comply with would be reasonably likely to have a Material Adverse Effect on JDA or E3 or a material adverse effect on the consummation of the transactions contemplated hereby shall have been filed, occurred or been obtained. (c) No Injunctions or Restrictions; Illegality. No temporary restraining order, preliminary or permanent injunction or other order issued by any court of competent jurisdiction or other legal or regulatory restraint or prohibition preventing the consummation of the Merger or limiting or restricting JDA's conduct or operation of the business of JDA or E3 after the Merger shall have been issued, nor shall any proceeding brought by any Governmental Entity seeking any of the foregoing be pending; nor shall there be any action taken, or any Law enacted, entered, enforced or deemed applicable to the Merger which makes the consummation of the Merger illegal. (d) Tax Opinion. JDA shall have received a written opinion from its counsel, Gray Cary Ware & Freidenrich LLP, and E3 shall have received a written opinion from its counsel, Morris, Manning & Martin, LLP, in form and substance reasonably satisfactory to both parties, to the effect that the Merger will be treated for federal income tax purposes as a tax-free reorganization within the meaning of Section 368(a) of the Code. The opinion condition referred to in this section shall not be waivable unless approval of the opposing party is obtained with appropriate disclosure. In rendering such opinions, counsel may rely upon reasonable 42 47 representations from JDA and E3 substantially in the form of the tax certificates attached hereto as Exhibit F and G. Section 7.2 Additional Conditions to Obligations of JDA and Sub. The obligations of JDA and Sub to effect the Merger are subject to the satisfaction of each of the following conditions, any of which may be waived in writing exclusively by JDA: (a) Representations and Warranties. The representations and warranties of E3 and the Signing Shareholders set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date, except (i) for changes contemplated by this Agreement, (ii) that representations and warranties which specifically relate to a particular date or period shall be true and correct as of such date or for such period and (iii) where the failure of any such representation or warranty to be true and correct on and as of the Closing Date, individually and in the aggregate, would not be reasonably likely to have a Material Adverse Effect on E3, or a material adverse effect upon the consummation of the transactions contemplated hereby; and JDA shall have received a certificate to such effect signed on behalf of E3 by the chief executive officer and the president of E3. For purposes of this subsection 7.2(a), the following events or occurrences shall not be deemed to be events or occurrences having a Material Adverse Effect on E3: (i) increases or decreases in the trading price of JDA Common Stock, as reported on the NASDAQ, occurring at any time or from time to time between the date hereof and the Closing Date; (ii) events or occurrences affecting the general economy or the industries or segments of the industries in which JDA or E3 do business, generally; or (iii) events or occurrences related directly to the Merger or the other transactions contemplated by this Agreement. (b) Performance of Obligations. E3 shall have performed in all material respects all obligations required to be performed by it or shall have refrained taking any actions prohibited under this Agreement at or prior to the Closing Date, and JDA shall have received a certificate to such effect signed on behalf of E3 by the chief executive officer of E3. (c) Approval. JDA shall have received from E3 written evidence that the execution, delivery and performance of E3's obligations under this Agreement have been duly and validly approved and authorized by the Board of Directors and by the Shareholders of E3. (d) Third Party Consents. JDA shall have been furnished with evidence satisfactory to it of the Consent of those persons whose consent or approval shall be required in connection with the Merger under the material contracts of E3 or material licenses or permits, as set forth in Schedule 7.2(d) hereto. (e) Medical Benefits Agreements. Concurrently herewith the Medical Benefits Agreements in the form attached as Exhibit H hereto shall have been executed by JDA and each of Anders Herlitz, Frank Schuster and William Huther, to be effective as of the Closing. As of the Closing, all of such agreements shall be in full force and effect in accordance with their terms. 43 48 (f) Opinion of E3 Counsel. JDA shall have received a legal opinion from Morris, Manning & Martin, LLP, counsel to E3, substantially in the form of Exhibit I attached hereto. (g) Escrow Agreement. The Escrow Agreement shall have been executed and delivered by the Shareholders' Representative and the Escrow Agent. (h) Blue Sky. JDA shall have received all permits or other authorizations required under applicable state blue sky Laws, or similar Laws of any foreign jurisdiction, for the issuance of JDA Common Stock pursuant to the Merger. (i) Resignations. JDA shall have received from each officer and director of each Acquired Entity, a resignation effective as of the Closing from each office or directorship held by each such person in any Acquired Entity other than those listed in Schedule 1.4. (j) Assignment of Intellectual Property. The individuals listed on Schedule 7.2(j) shall have entered into an intellectual property assignment agreement with E3 whereby all of his rights, title and interest in and to the E3 Intellectual Property or E3 Products is assigned, conveyed and transferred to E3. (k) Indebtedness. At Closing, First Union National Bank shall be prepared to deliver UCC-3 financing statements or other appropriate instruments or documents necessary to terminate or effect the termination of any and all Liens (including, but not limited to, any Liens on E3 Intellectual Property and any and all equity interests in any Subsidiary of E3) that it holds with respect to the Bank Debt if such Bank Debt is fully satisfied at Closing. At Closing, First Union National Bank shall deliver the original copies of any and all term notes or revolving credit notes provided under the Loan Agreement to JDA for cancellation if such bank debt is fully satisfied at Closing. If JDA has determined in its sole discretion that it is necessary, First Union National Bank shall have taken any and all necessary and appropriate actions to assign, transfer or convey any and all rights, title and interests in and to the E3 Foreign Subsidiary Notes at the Closing. (l) 401(k) Plan. At the Closing, JDA shall have received satisfactory evidence, pursuant to Section 6.7 above, that the E3 401(k) plan shall have been terminated effective as of the day immediately preceding the Closing Date. (m) Termination of E3 Stock Option Plan. Prior to the Closing, E3 shall have terminated the E3 Stock Option Plan and shall have canceled all stock options outstanding under such plan or otherwise. (n) Non-competition and Non-solicitation Agreement. On or prior to the Closing Date, the Non-competition and Non-solicitation Agreement, in the form of Exhibit J attached hereto, shall have been executed by JDA and each of the Indemnifying Shareholders. Section 7.3 Additional Conditions to Obligations of E3. The obligation of E3 to effect the Merger is subject to the satisfaction of each of the following conditions, any of which may be waived, in writing, exclusively by E3: 44 49 (a) Representations and Warranties. The representations and warranties of JDA and Sub set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date, except (i) for changes contemplated by this Agreement, (ii) that representations and warranties which specifically relate to a particular date or period shall be true and correct as of such date or for such period, and (iii) where the failure of any such representation or warranty to be true and correct on and as of the Closing Date, individually or in the aggregate, would not be reasonably likely to have a Material Adverse Effect on JDA, or a material adverse effect upon the consummation of the transactions contemplated hereby; and E3 shall have received a certificate to such effect signed on behalf of JDA by the chief financial officer of JDA. For the purposes of the foregoing condition, the following events or occurrences shall not be deemed to be events or occurrences having a Material Adverse Effect on JDA: (i) reductions or increases in the trading price of JDA Common Stock, as reported on the NASDAQ, occurring at any time or from time to time between the date hereof and the Closing Date; (ii) events or occurrences affecting the general economy or the industries or segments of the industries in which JDA or E3 do business, generally; or (iii) events or occurrences related directly to the Merger or the other transactions contemplated by this Agreement. (b) Performance of Obligations. JDA and Sub shall have performed in all material respects all obligations required to be performed by them under this Agreement at or prior to the Closing Date, and E3 shall have received a certificate to such effect signed on behalf of JDA by the chief financial officer of JDA. (c) Approvals. E3 shall have received from JDA and Sub written evidence that the execution, delivery and performance of JDA's and Sub's obligations under this Agreement have been duly and validly approved and authorized by the Boards of Directors of JDA and Sub. (d) Opinion of JDA Counsel. E3 shall have received a legal opinion from Gray Cary Ware & Freidenrich LLP, counsel to JDA, substantially in the form of Exhibit K attached hereto. (e) Escrow Agreement. The Escrow Agreement shall have been executed and delivered by JDA and the Escrow Agent. (f) Registration Rights Agreement. The Registration Rights Agreement, substantially in the form of Exhibit L attached hereto, shall have been executed and delivered by JDA and the Shareholders. (g) Indebtedness. At Closing, First Union National Bank shall be prepared to deliver UCC-3 financing statements or other appropriate instruments or documents necessary to terminate or effect the termination of any and all Liens (including, but not limited to, any Liens on E3 Intellectual Property and any and all equity interests in any Subsidiary of E3) that it holds with respect to the Bank Debt if such Bank Debt is fully satisfied at Closing. At Closing, First Union National Bank shall deliver the original copies of any and all term notes or revolving credit notes provided under the Loan Agreement to JDA for cancellation if such Bank Debt is fully satisfied at Closing. If JDA has determined in its sole discretion that it is necessary, First 45 50 Union National Bank shall have taken any and all necessary and appropriate actions to assign, transfer or convey any and all rights, title and interests in and to the E3 Foreign Subsidiary Notes at the Closing. (h) Medical Benefits Agreements. Concurrently herewith the Medical Benefits Agreements in the form attached as Exhibit H hereto shall have been executed by JDA and each of Anders Herlitz, Frank Schuster and William Huther, to be effective as of the Closing. As of the Closing, all of such agreements shall be in full force and effect in accordance with their terms. ARTICLE VIII TERMINATION AND AMENDMENT [INTENTIONALLY DELETED] ARTICLE IX INDEMNIFICATION Section 9.1 Survival of Representations and Warranties and Covenants. If the Merger occurs, all of the representations and warranties contained in this Agreement shall survive the Closing Date and shall continue in full force and effect for the period ending on the date that is one (1) year following the Closing Date, whereupon they will terminate and expire, except that and the representations and warranties of the Shareholders in Article IIIA shall survive forever. This Section 9.1 shall not limit any covenant or agreement of the parties hereto which by its terms contemplate performance after the Effective Time. The foregoing notwithstanding, all representations and warranties shall be deemed to be true and correct only as of the date of this Agreement except for those representations and warranties that specifically relate to a particular date or period, which shall be deemed to be true and correct as of such date and for such period. Section 9.2 Indemnification by Shareholders. (a) Subject to the terms and conditions contained herein, each of the Shareholders shall indemnify, defend and hold harmless the JDA Group from, against, for and in respect of any and all losses, damages, costs and expenses (including reasonable legal fees and expenses) which any member of the JDA Group may sustain or incur which are caused by or arise out of (i) any inaccuracy in or breach of any of the representations, warranties or covenants made by E3 or the Signing Shareholders in this Agreement, including the E3 Disclosure Schedule, (ii) any E3 Transaction Expenses in excess of the amount set forth on the Closing E3 Transaction Expense Schedule and reflected in the calculation of the Cash Merger Consideration, (iii) any breach by the Shareholders of this Article IX or the Escrow Agreement, or (iv) any of the matters set forth in the Indemnification Schedule attached as Exhibit M hereto, to the extent therein set forth (collectively, "JDA LOSSES"). (b) No Shareholder shall be required to indemnify any member of the JDA Group for any JDA Losses until the aggregate amount of all JDA Losses under all claims shall exceed the Floor Amount; provided, however, that JDA Losses under Section 3.7, 46 51 Section 9.2(a)(ii) and JDA Losses identified on Exhibit M as Non-Floor Losses shall be recoverable in full without regard to the Floor Amount. Once the aggregate amount of all JDA Losses under all claims exceeds the Floor Amount, all JDA Losses in excess of the first $200,000 initially included in the Floor Amount shall be recoverable in full. (c) The provisions of Sections 9.2(b) above and 9.6 below shall not limit, in any manner, (i) any remedy at Law or in equity to which any member of the JDA Group shall be entitled against E3 or any Shareholder as a result of willful fraud or intentional misrepresentation by E3, any Shareholder or any of their respective representatives, or (ii) any rights that JDA may have under federal or state securities Laws. (d) The amount of JDA Losses shall be computed after giving effect to the receipt of any insurance proceeds with respect thereto. Section 9.3 Procedures for Indemnification. (a) An Indemnification Claim shall be made by Indemnitee by delivery of a written notice to the Shareholders' Representative and the Escrow Agent requesting indemnification and specifying in reasonable detail the basis on which indemnification is sought (and shall include relevant documentation related to the Indemnification Claim), the amount of the asserted JDA Losses and, in the case of a Third Party Claim, containing (by attachment or otherwise) such other information as Indemnitee shall have concerning such Third Party Claim. (b) If the Indemnification Claim involves a Third Party Claim, the procedures set forth in Section 9.4 hereof shall be observed by Indemnitee and the Shareholders' Representative. Section 9.4 Defense of Third Party Claims. Should any claim be made, or suit or proceeding (including, without limitation, a binding arbitration or an audit by any taxing authority) be instituted against an Indemnitee which, if prosecuted successfully, would be a matter for which Indemnitee is entitled to indemnification under this Agreement, the obligations and liabilities of the parties hereunder with respect to such Third Party Claim shall be subject to the following terms and conditions: (a) Indemnitee shall give the Shareholders' Representative and Escrow Agent written notice of any Third Party Claim promptly after receipt by Indemnitee of notice thereof. The Shareholders' Representative may, at his option, (i) undertake control of the defense thereof by counsel of its own choosing reasonably acceptable to Indemnitee or (ii) decline to assume control of but participate in the defense thereof provided that such participation by the Shareholders' Representative shall be at the expense of the Indemnitors. Indemnitee may participate in the defense through its own counsel at its own expense. The assumption of the defense of any Third Party Claim by Shareholders' Representative shall not be an acknowledgment by Shareholders' Representative that such Third Party Claim is subject to indemnification under the provisions of this Article IX and that such provisions are binding on the Shareholders. If, however, Shareholders' Representative fails or refuses to undertake the defense of such Third Party Claim within fifteen (15) days after written notice of such claim has been delivered to Shareholders' Representative by Indemnitee, Indemnitee shall have the right to 47 52 undertake the defense, compromise and, subject to Section 9.5 hereof, settlement of such Third Party Claim with counsel of its own choosing. In the circumstances described in the preceding sentence, Indemnitee shall, promptly upon its assumption of the defense of such Third Party Claim, make an Indemnification Claim which shall be deemed an Indemnification Claim that is not a Third Party Claim for the purposes of the procedures set forth herein. Failure of Indemnitee to furnish written notice to the Shareholders' Representative of a Third Party Claim shall not release the Shareholders' Representative or the Indemnitors from their obligations hereunder, except to the extent the Indemnitors are prejudiced by such failure. (b) Indemnitee and the Shareholders' Representative shall cooperate with each other in all reasonable respects in connection with the defense of any Third Party Claim, including making available records relating to such claim and furnishing employees of Indemnitee as may be reasonably necessary for the preparation of the defense of any such Third Party Claim or for testimony as witness in any proceeding relating to such claim. (c) Notwithstanding anything else in this Section 9.4 to the contrary, in the event of a Third Party Claim that is reasonably estimated to exceed fifty percent (50%) of the total Merger Consideration, valued as of the Closing Date, in the case of a claim related to Section 3.9 and $5 million, in the case of any other claim, Indemnitee shall have the option to undertake control of the defense by counsel of Indemnitee's choosing reasonably acceptable to the Shareholders' Representative. In this circumstance, Indemnitee shall, promptly upon its assumption of the defense of such Third Party Claim, make an Indemnification Claim which shall be deemed an Indemnification Claim, but shall not be subject to Indemnitor's right to assume the defense of such claim pursuant to Section 9.4. Section 9.5 Settlement of Third Party Claims. No settlement by Indemnitee of a Third Party Claim shall be made without the prior written consent by or on behalf of the Shareholders' Representative, which consent shall not be unreasonably withheld or delayed. If the Shareholders' Representative has assumed the defense of a Third Party Claim as contemplated by Section 9.4 hereof, no settlement of such Third Party Claim may be made by the Shareholders' Representative without the prior written consent by or on behalf of Indemnitee, which consent shall not be unreasonably withheld or delayed. In the event of any dispute regarding the reasonableness of a proposed settlement, the party that will bear the larger financial loss resulting from such settlement shall make the final determination in respect thereto, which determination shall be final and binding on all involved parties. For the purposes of this Section 9.5, a proposed settlement involving E3 or JDA intellectual property rights shall be deemed reasonable only if such settlement includes a royalty-free license or right to exploit the intellectual property rights in question; provided, however, that such license or right shall not be necessary if the intellectual property rights are immaterial to the use, development or sale of E3 Products. Section 9.6 Manner of Indemnification; Excess Indemnification by Indemnifying Shareholders. (a) Except as specifically set forth in this Article IX, the Escrowed Consideration deposited into Escrow pursuant to the Escrow Agreement in accordance with the provisions of Section 2.5, shall provide the sole and exclusive fund against which members of 48 53 the JDA Group may assert claims of indemnification under this Article IX. Any payout of Escrowed Consideration to an Indemnitee (the "ESCROW PAYMENT") shall consist of Escrowed Shares and Escrowed Cash in the same ratio as the Stock Merger Consideration and Cash Merger Consideration bear to the total Merger Consideration as of Closing; provided, however, that the Shareholders' Representative shall have the right at any commercially reasonable time prior to payment of a claim by the Escrow Agent to adjust the composition of the Escrow Payment in his sole discretion by delivery of written notice to JDA and the Escrow Agent of such adjustment. For the purpose of valuing the Escrowed Shares to be paid to an Indemnitee, the value of JDA Common Stock shall be the average of the per share closing prices of JDA Common Stock on the NASDAQ on the last ten trading days prior to such payment of that Indemnitee. (b) Each claim for indemnification asserted against the Shareholders pursuant to this Article IX shall be made only in accordance with the procedures set forth in the Escrow Agreement, subject to the provisions of Section 9.2(c) hereof. (c) Except as specifically provided in this subsection and in Section 9.2(c), the rights of the JDA Group under the provisions of this Article IX shall be the exclusive remedy of the JDA Group for any inaccuracy in or breach of the representations, warranties or covenants of E3 and the Shareholders in this Agreement and for any JDA Losses. In the event of a breach of a representation or warranty contained in Section 3.9, and only in the event, that any JDA Loss for such breach exceeds the amount of the Escrowed Consideration remaining in the Escrow (such comparison to be made and such Escrowed Consideration to be valued for purposes of this subsection as of the date of delivery of the notice of Indemnification Claim described in Section 9.3(a)), then the Indemnifying Shareholders shall be obligated, jointly and severally and in addition to such Shareholders other indemnification obligations under this Article IX, to indemnify, defend and hold harmless the JDA Group from, against, for and in respect of such excess amount up to and including the Excess Indemnification Liability Cap; provided, however, that notwithstanding the Indemnifying Shareholders' joint and several liability hereunder, JDA shall use commercially reasonable efforts to pursue such indemnification claims on a pro rata basis against all the Indemnifying Shareholders. Such obligations shall be discharged pursuant to the procedures and manner of indemnification set forth in this Article IX (including without limitation the role and authority of the Shareholders' Representative set forth in Section 9.7). Notwithstanding the foregoing, the liability of the Indemnifying Shareholders as a group, jointly and not severally, under this subsection shall not exceed the Excess Indemnification Liability Cap. Section 9.7 Appointment of Shareholders' Representative. For purposes of this Agreement, the Shareholders hereby consent to the appointment of Anders Herlitz as the representative and attorney-in-fact for and on behalf of the Shareholders, and to the taking by the Shareholders' Representative of any and all actions and the making of any decisions required or permitted to be taken by him under this Agreement or the Escrow Agreement, including, without limitation, the exercise of the power to (i) execute the Escrow Agreement on behalf of the Shareholders, (ii) authorize delivery to JDA of Escrow Shares in satisfaction of Indemnification Claims, (iii) agree to, negotiate, enter into settlements and compromises of and comply with orders of courts and awards of arbitrators with respect to such Indemnification Claims, (iv) resolve any Indemnification Claims and (v) take all actions necessary in the judgment of the Shareholders' Representative for the accomplishment of the foregoing and all of the other terms, 49 54 conditions and limitations of this Agreement and the Escrow Agreement. Accordingly, the Shareholders' Representative has unlimited authority and power to act on behalf of each Shareholder with respect to this Agreement and the Escrow Agreement and the disposition, settlement or other handling of all Indemnification Claims, rights or obligations arising from and taken pursuant to this Agreement. The Shareholders will be bound by all actions taken by the Shareholders' Representative in connection with this Agreement, and JDA shall be entitled to rely on any action or decision of the Shareholders' Representative. The Shareholders' Representative will incur no liability with respect to any action taken or suffered by him in reliance upon any notice, direction, instruction, Consent, statement or other document believed by him to be genuine and to have been signed by the proper person (and shall have no responsibility to determine the authenticity thereof), nor for any other action or inaction, except his own willful misconduct or bad faith. At any time during the term of the Escrow Agreement, holders of a majority of the Escrow Shares subject to Indemnification Claims under this Article IX may, by written consent, appoint a new representative as the Shareholders' Representative by sending notice and a copy of the written consent appointing such new representative signed by holders of a majority of the Escrow Shares to JDA and the Escrow Agent. Such appointment will be effective upon the later of the date indicated in the Consent or the date such Consent is received by JDA and the Escrow Agent. Section 9.8 Indemnification of Shareholders' Representative. The Shareholders shall, severally and not jointly, on a pro rata basis based on their proportionate share of the Merger Consideration, indemnify , defend and hold the Shareholders' Representative harmless from and against any loss, damage, tax, liability and expense that may be incurred by the Shareholders' Representative arising out of or in connection with the acceptance or administration of the Shareholders' Representative's duties, including the defense of any Third Party Claim, except as caused by the Shareholders' Representative's proven gross negligence or willful misconduct (as determined in light of all the circumstances, including the time and facilities available to him in the ordinary course of business), including legal costs and expenses of defending such Shareholders' Representative against any claim or liability in connection with the performance of the Shareholders' Representative's duties. The Shareholders' Representative shall be entitled to, but not limited to, such indemnification from the Escrowed Consideration (net of any amounts due, owed or distributed to JDA) that are distributed to the Shareholders upon termination of the escrow. Section 9.9 Post Closing Indemnification. If a claim is bought after the Closing against any person who was an officer or director of E3 as of the date of this Agreement, and that claim is based upon such person's status as an officer, director, Employee or agent of the E3, or any of the E3 Subsidiaries, prior to the Closing, and that person would have been entitled to indemnification against such claim under the provisions of E3's Articles of Incorporation in effect as of September 6, 2001, then the Surviving Corporation shall indemnify such person to the same extent as that person would have been entitled to under the provisions of E3's Articles of Incorporation in effect as of September 6, 2001. 50 55 ARTICLE X GENERAL PROVISIONS Section 10.1 Notices. All notices and other communications hereunder shall be in writing and shall be deemed given when received if delivered personally or by commercial delivery service (with signature acknowledging receipt), or sent via facsimile (with confirmation of receipt), or within seventy-two (72) hours after being mailed by registered or certified mail (return receipt requested), in each case, to the parties at the following addresses (or at such other address for a party as shall be specified by like notice): (a) if to JDA, to: JDA Software, Group, Inc. 14400 N. 87th Street Scottsdale, Arizona 85260-3649 Attention: James D. Armstrong Fax: (480) 308-4265 Tel: (480) 308-3014 with a copy to: JDA Software, Group, Inc. 14400 N. 87th Street Scottsdale, Arizona 85260-3649 Attention: Michael Bridge, Esq. Fax: (480) 308-4268 Tel: (480) 308-3460 with a copy to: Gray Cary Ware & Freidenrich LLP 1221 South MoPac Expressway, Suite 400 Austin, Texas 78746-6875 Attention: Paul E. Hurdlow, Esq. Fax: (512) 457-7020 Tel: (512) 457-7001 (b) if to E3, to E3 Corporation 1800 Parkway Place, Suite 600 Marietta, Georgia 30067 Attention: Anders Herlitz Fax: (770) 421-6600 Tel: (770) 424-0100 51 56 with a copy to: Morris, Manning & Martin, LLP 1600 Atlanta Financial Center 3343 Peachtree Road, NE Atlanta, Georgia 30326 Attention: Grant W. Collingsworth, Esq. Fax: (404) 365-9532 Tel: (404) 233-7000 (c) if to a Signing Shareholder, to the appropriate address set forth upon Exhibit A. Section 10.2 Interpretation. (a) For purposes of this Agreement (i) When reference is made to an Article or Section, such reference shall be to an Article or Section of this Agreement unless otherwise indicated; and (ii) The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. (b) This Agreement has been negotiated by the respective parties hereto and their attorneys and the language hereof shall not be construed for or against any party. Section 10.3 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original as against any party whose signature appears on such counterpart and all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart. Section 10.4 Severability. In the event that any provision of this Agreement, or the application thereof, becomes or is declared by a court of competent jurisdiction to be illegal, void or unenforceable, the remainder of this Agreement will continue in full force and effect and the application of such provision to other persons or circumstances will be interpreted so as reasonably to effect the intent of the parties hereto. The parties further agree to replace such void or unenforceable provision of this Agreement with a valid and enforceable provision that will achieve, to the extent possible, the economic, business and other purposes of such void or unenforceable provision. Section 10.5 Entire Agreement. This Agreement (including the schedules and exhibits hereto and the other documents delivered pursuant hereto) constitutes the entire agreement among the parties concerning the subject matter hereof and supersedes all prior agreements and 52 57 understandings, both written and oral, among the parties with respect to the subject matter hereof, other than the Confidentiality Agreement. Section 10.6 Governing Law. This Agreement shall be governed and construed in accordance with the Laws of the State of Delaware without regard to the Laws that might otherwise govern under any applicable conflicts of Law principles thereof. Section 10.7 Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of Law or otherwise) without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and assigns. Section 10.8 Third Party Beneficiaries. Nothing contained in this Agreement is intended to confer upon any person other than the parties hereto and their respective successors and permitted assigns, any rights, remedies or obligations under, or by reason of this Agreement, except that (i) the persons who are Shareholders immediately prior to the Effective Time (and their successors and assigns) are express intended third party beneficiaries of Articles I, II and IV and Article IX, and (ii) each of the foregoing persons is an express intended third party beneficiary of Article X, to the extent relevant to any of the foregoing, and as such are entitled to rely on the provisions hereof as if a party hereto. Section 10.9 Release. (a) Subject only to the provisions of Section 10.9(b) and the limitations set forth in the last sentence of this Section 10.9(a) and notwithstanding any other provision of this Agreement, each Signing Shareholder hereby unconditionally and irrevocably releases and forever discharges, effective as of and forever after the Effective Time, to the fullest extent permitted by applicable Law, the Released Parties from any and all debts, liabilities, obligations, claims, demands, actions or causes of action, suits, judgments or controversies of any kind whatsoever (collectively, "PRE-ACQUISITION CLAIMS") against E3, or Sub solely in its capacity as successor to E3, if any, or any of them that arises out of or is based on any agreement or understanding or act or failure to act (including any act or failure to act that constitutes ordinary or gross negligence or reckless or willful, wanton misconduct), misrepresentation, omission, transaction, fact, event or other matter occurring prior to the Effective Time (whether based on any governmental requirement or right of action, at Law or in equity or otherwise, foreseen or unforeseen, matured or unmatured, known or unknown, accrued or not accrued) (collectively, "PRE-ACQUISITION MATTERS"), including without limitation: (i) claims by the Signing Shareholder with respect to repayment of loans or indebtedness; (ii) any rights, titles and interests in, to or under any agreements, arrangements or understandings to which the Signing Shareholder is a party; and (iii) claims by the Signing Shareholder with respect to dividends, violation of preemptive rights, or payment of salaries or other compensation or in any way arising out of or in connection with the Signing Shareholder's employment with E3 or any E3 Subsidiary, the cessation of that employment, the Signing Shareholder's status as an officer, director or shareholder of E3 or E3 Subsidiary or otherwise (subject to Section 9.7 and excluding any and all claims in respect of accrued and unpaid amounts owing to the Shareholder as salary or wages at the rates or in the amounts, as the case may be, set forth in the E3 Disclosure Schedule); 53 58 provided, however, that the Pre-Acquisition Claims shall not include any debts, liabilities, obligations, claims, demands, actions or causes of actions, suits, judgments or controversies of any kind whatsoever that arise out of or are based on the negotiation or execution of this Agreement or the other Transaction Documents, or the consummation of the Merger or other transactions contemplated by this Agreement or the other Transaction Documents or any other actions by E3 taken in connection with or in contemplation of the transactions contemplated by this Agreement or the other Transaction Documents. The Signing Shareholder further agrees not to file or bring any litigation before any governmental entity on the basis of or respecting any Pre-Acquisition Claim concerning any Pre-Acquisition Matter against any Released Party. Each Signing Shareholder (i) acknowledges that he fully comprehends and understands all the terms of this Section 10.9(a) and their legal effects and (ii) expressly represents and warrants that (A) he is competent to effect the release made in this Section 10.9 knowingly and voluntarily and without reliance on any statement or representation of any Released Party or its representatives and (B) he had the opportunity to consult with an attorney of his choice regarding this Section 10.9(a). This Section 10.9(a) will not affect the rights of the Signing Shareholders under the Agreement or any other Transaction Document. Section 10.10 Gender. Pronouns in masculine, feminine and neuter genders shall be construed to include any other gender, and words in the singular form shall be construed to include the plural and vice versa, unless the context otherwise requires. [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK] 54 59 IN WITNESS WHEREOF, JDA, Sub and E3 have caused this Agreement to be signed by their respective officers thereunto duly authorized, and the Signing Shareholders have signed this Agreement, as of the date first written above. JDA SOFTWARE GROUP, INC., a Delaware corporation By:___________________________ Name:_________________________ Title:________________________ 60 E3 CORPORATION, a Georgia corporation By:___________________________ Name:_________________________ Title:________________________ 61 E3 ACQUISITION CORP., a Delaware corporation By:___________________________ Name:_________________________ Title:________________________ 62 SIGNING SHAREHOLDERS ______________________________ Anders H. Herlitz ______________________________ Christina R. Herlitz ______________________________ Carl H. Herlitz ______________________________ Jan W. Herlitz ______________________________ Frank K. Schuster ______________________________ William H. Huther ______________________________ Daniel J. Craddock 63 EXHIBIT A LIST OF E3 SIGNING SHAREHOLDERS Anders H. Herlitz 1010 Seminole Dr. Apt. 1705 Ft. Lauderdale, Florida 33304 Christina R. Herlitz 1010 Seminole Dr. Apt. 1705 Ft. Lauderdale, Florida 33304 Carl H. Herlitz 125 Old Blaisdell Road Sutton, NH 03273 Jan W. Herlitz 1010 Seminole Dr. Apt. 1705 Ft. Lauderdale, Florida 33304 Frank K. Schuster 9610 Club South Circle, #4110 Sarasota, Florida 34238 William H. Huther 11291 Long Water Chase Ct. Gulf Harbour Y&CL Ft. Myers, Florida 33908-4952 Daniel J. Craddock 1208 Fenmore Hall Powder Springs, Georgia 30127 64 EXHIBIT B ESCROW AGREEMENT 65 EXHIBIT C JULY BALANCE SHEET 66 EXHIBIT D MARCH BALANCE SHEET 67 EXHIBIT E SHAREHOLDER'S CERTIFICATE 68 EXHIBIT F E3 TAX CERTIFICATE 69 EXHIBIT G JDA TAX CERTIFICATE 70 EXHIBIT H MEDICAL BENEFITS AGREEMENT 71 EXHIBIT I OPINION OF MORRIS, MANNING & MARTIN, LLP 72 EXHIBIT J NON-COMPETITION AND NON-SOLICITATION AGREEMENT 73 EXHIBIT K OPINION OF GRAY CARY WARE & FREIDENRICH LLP 74 EXHIBIT L REGISTRATION RIGHTS AGREEMENT 75 EXHIBIT M INDEMNIFICATION SCHEDULE 1. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from, related to or attributable to, and to the extent based upon, the failure to include in a Customer License Agreement with a customer based in the United States both a contractual exclusion of liability for consequential damages and a limitation of aggregate damages provision limiting E3's exposure to such damages at least to the extent such exposure would be limited by the following language: E3'S TOTAL LIABILITY FOR TORT, CONTRACT AND OTHER DAMAGES (EXCEPT FOR AND SUBJECT TO SECTION 1(A) OF THIS SECTION TWO) SHALL NOT EXCEED THE LICENSE FEE PAID BY LICENSEE FOR THE PARTICULAR SOFTWARE PROGRAM GIVING RISE TO THE CLAIM FOR, OR ALLEGEDLY CAUSING THE, DAMAGES. NOTWITHSTANDING ANYTHING TO THE CONTRARY, IN NO EVENT SHALL E3 BE LIABLE FOR LOST PROFITS OR OTHER INCIDENTAL OR CONSEQUENTIAL, INDIRECT, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES UNDER ANY CIRCUMSTANCES WHATSOEVER. Indemnification Claims based upon this Item 1 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). 2. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to any claim by Frank Schuster that he is entitled to severance payments or other compensation associated with termination of his employment in excess of accrued salary and benefits and severance benefits equal to six months of base salary. Indemnification Claims based upon this Item 2 shall be subject in all respects to the procedures and limitations set forth in Article IX and shall be a Non-Floor Loss. 3. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to any claim by Jose Alarcon that he is contractually entitled to severance or other similar payments solely as a result of the Merger or any change in the Board of Directors in connection with the Merger. Indemnification Claims based upon this Item 3 shall be subject in all respects to the procedures and limitations set forth in Article IX and shall be a Non-Floor Loss. 4. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to any claim by Peter Kornafel that he is entitled to equity securities of E3 or JDA as a result of or prior to the Merger. Indemnification Claims based upon this Item 4 shall be subject in all respects to the procedures and limitations set forth in Article IX and shall be a Non-Floor Loss. 76 5. Any payments of sales taxes (including related penalties and interest, if any) to sales tax authorities by JDA following the Closing Date relating to the matters described in Schedule 3.5, Schedule 3.6(j), and Schedule 3.7 of the E3 Disclosure Schedules less (i) the amount reserved for such payments on the July Balance Sheet and (ii) all such sales tax payments (including related penalties and interest, if any) that JDA is reasonably able to collect from customers of E3 following the Closing Date. Indemnification Claims based upon this Item 5 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). 6. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to E3's improper treatment of any employee as an "exempt" employee under the Fair Labor Standards Act. Indemnification Claims based upon this Item 6 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). 7. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to the loss of trade secret protection as a result of the failure of the following persons to have signed confidentiality agreements in favor of E3: Ryan Brothers Christopher Kang Michael Pecora Randy Byars Nam Su Kang Wayne Rabstejnek Wen Chen Bagyalakshmi Kathireson Terrence Rice Rod England Steve Keinath Sicily Richardson Brett Harris Christopher Loder Dennis Roper King Harrison Roger Mahler Joe Shenefield Debbie Horton-Rice Dale Moldenhauer Jonathan Yergin Saraj Kanduri Ken Palmer Scott Jacobs JeffWitte Igor Alvarez Dana Lovell Dawn Smith Heather Boothe Debbie McCullough Rainer Stein Andrew Calzon Marvin McGill I. Stevens Julia Cox Thomas Merandi, II Kim Stevenson C. De Gasquet Erin Miller Vaheeduddin Syed C. Dubois R. Moreno Steve Thomas Stuart Dunkin ME Nygaard F. Ventrone Stephanie Grammont L. Ohlsson Hugo Villafan B. Gryding Thomas Ollivier M. Virtanen Carl James F. Parrot Therese Viscelli R. Johanson O. Pedersen Willy Weie Jennifer Johnson S. Place Lee Windsor Tommy Johnson Edgar Ramirez Robert Zierler Y. Kunte Jennifer Reed Patrick Liefooghe Jane Roberts W. Lovatt Lucy Savidge 77 Indemnification Claims based upon this Item 7 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). 8. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to unpaid Taxes claimed by the relevant taxation authority as a result of the audits identified in Schedule 3.7(f) of the E3 Disclosure Schedules and in the subsequent disclosure in the same schedule regarding Germany and France. Indemnification Claims based upon this Item 8 shall be subject in all respects to the procedures and limitation set forth in Article IX and shall be a Non-Floor Loss. 9. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to the pending litigation with the French tax authorities disclosed in Schedule 3.18 of the E3 Disclosure Schedules under the caption "France." Indemnification Claims based upon this Item 9 shall be subject in all respects to the procedures and limitations set forth in Article IX , including without limitation the Floor Amount set forth in Section 9.2(b). 10. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to the pending litigation with M. Le Peniec disclosed in Schedules 3.12 and 3.18 of the E3 Disclosure Schedules. Indemnification Claims based upon this Item 10 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). 11. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to the disclosure in Schedule 3.17(c) of the E3 Disclosure Schedules regarding overtime payments potentially due to certain employees in Finland. Indemnification Claims based upon this Item 11 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). 12. Any losses, damages, costs and expenses (including reasonable legal fees and expenses) arising from or related to the disclosure in Schedule 3.9 of the E3 Disclosure Schedules regarding the lack of confidentiality or intellectual property ownership/assignment provisions in certain contracts with employees in Australia and Finland. Indemnification claims based upon this Item 12 shall be subject in all respects to the procedures and limitations set forth in Article IX, including without limitation the Floor Amount set forth in Section 9.2(b). EX-4.1 4 p65597ex4-1.txt EX-4.1 1 EXHIBIT 4.1 JDA SOFTWARE GROUP, INC. REGISTRATION RIGHTS AGREEMENT SEPTEMBER 7, 2001 2 REGISTRATION RIGHTS AGREEMENT THIS REGISTRATION RIGHTS AGREEMENT is entered into as of September 7, 2001 (this "AGREEMENT"), by and among JDA Software Group, Inc., a Delaware corporation (the "JDA"), and the holders of JDA's Common Stock (the "HOLDERS") listed on Exhibit A attached hereto. R E C I T A L S WHEREAS, the Holders are receiving shares of Common Stock pursuant to the Agreement and Plan of Reorganization dated September 7, 2001 (the "MERGER AGREEMENT"), by and among JDA, E3 Acquisition Corp., E3 and certain stockholders of E3. WHEREAS, JDA has agreed to enter into this Agreement with the Holders as a condition to closing of the Merger Agreement. NOW, THEREFORE, in consideration of the mutual promises contained herein, and other consideration, the receipt and sufficiency of which hereby is acknowledged, the parties hereto agree as follows: 1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms shall have the following respective meanings: 1.1. "COMMON STOCK" shall mean the Common Stock, $0.01 par value, of JDA. 1.2. "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder, all as the same shall be in effect at that time. 1.3. "INITIATING HOLDERS" means the Holders who, in the case of the demand registration under Section 4, are the holders of more than fifty percent (50%) of the Registrable Securities. 1.4. "PIGGYBACK RIGHTS" means those rights provided to the Holders pursuant to Section 3.1 of this Agreement. 1.5. The terms "REGISTER", "REGISTERED" and "REGISTRATION" refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act (as defined below), and the declaration or ordering of the effectiveness of such registration statement. 1.6. "REGISTRABLE SECURITIES" means the 1,600,085 shares of Common Stock received by the Holders pursuant to the Merger Agreement; provided, however, that the Common Stock shall only be treated as Registrable Securities if and for 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, (B) sold in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof so that all transfer 3 restrictions and restrictive legends with respect thereto are removed upon the consummation of such sale, or (C) transferred in a transaction whereby the registration rights granted herein are not assigned. 1.7. "REGISTRATION EXPENSES" shall mean all expenses (excluding underwriting discounts and selling commissions and any costs or expenses of any counsel retained by Holders) incurred in connection with a registration under Sections 3 and 4 hereof, including, without limitation, all registration and filing fees, printing expenses, fees and disbursements of counsel for JDA, and blue sky fees and expenses. 1.8. "SECURITIES ACT" shall mean the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder, all as the same shall be in effect at the time. 1.9. "SEC" shall mean the Securities and Exchange Commission or any other federal agency at the time administering the Securities Act. 2. RESTRICTIVE LEGEND. Each certificate representing Registrable Securities shall (unless otherwise permitted or unless the securities evidenced by such certificate shall have been registered under the Securities Act) be stamped or otherwise imprinted with a legend substantially 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, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS. SUCH SHARES MAY NOT BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE 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 COMPANY AT THE PRINCIPAL EXECUTIVE OFFICE OF THE COMPANY. Upon request of a holder of such a certificate, JDA shall remove the foregoing legend from the certificate or issue to such holder a new certificate therefor free of any transfer legend, if, with such request, JDA shall have received either (i) a written opinion of legal counsel to the holder who shall be reasonably satisfactory to JDA, addressed to JDA and reasonably satisfactory in form and substance to JDA's counsel, to the effect that the proposed transfer of the Registrable Securities may be effected without registration under the Securities Act and that future transfers will not require such registration or (ii) a "no-action" letter from the SEC to the effect that the distribution of such securities and any subsequent transfer without registration will not result in a recommendation by the staff of the SEC that action be taken with respect thereto, unless any such transfer legend may be removed (a) for routine sales under Rule 144, 2 4 (b) pursuant to Rule 144(k), and (c) for distributions by partnerships and limited liability companies, in which case no such legal opinion or "no-action" letter shall be required. 3. PIGGYBACK REGISTRATION. 3.1. If, at any time prior to the termination of the rights under this Agreement, JDA shall determine to register any of its securities either for its own account or for the account of a security holder or holders exercising their respective demand registration rights, other than a registration relating solely to employee benefit plans or a registration relating solely to a SEC Rule 145 transaction or a registration on any registration form which does not permit secondary sales or does not include substantially the same information as would be required to be included in a registration statement covering the sale of Registrable Securities, JDA will: (a) promptly give to each Holder written notice thereof; and (b) include in such registration, and in any underwriting involved therein, all of the Registrable Securities specified in a written request or requests made by any Holder within fifteen (15) days after receipt of the written notice from JDA described in clause (a) above, except as set forth in Section 3.2 below. Such written request may specify all or a part of a holder's Registrable Securities. 3.2. Underwriting. If the registration for which JDA gives notice is for a registered public offering involving an underwriting, JDA shall so advise the Holders as a part of the written notice given pursuant to Section 3.1. In such event the right of any Holder to registration pursuant to Section 3 shall be conditioned upon such Holder's participation in such underwriting and the inclusion of such Holder's Registrable Securities in the underwriting to the extent provided herein. All Holders proposing to distribute their securities through such underwriting shall (together with JDA and the other stockholders distributing their securities through such underwriting) enter into an underwriting agreement in customary form with a nationally recognized underwriter selected for underwriting by JDA (the "UNDERWRITER"). Notwithstanding any other provision of this Section 3, if the Underwriter determines that marketing factors require a limitation on the number of shares to be underwritten, the Underwriter may (subject to the allocation priority set forth below) exclude from such registration and underwriting all or a portion of the Registrable Securities. JDA shall so advise all holders of securities requesting registration, and the number of shares of securities that are entitled to be included in the registration and underwriting by persons other than JDA shall be allocated in the following priority: first, among all Holders in proportion, as nearly as practicable, to the respective amounts of securities which they had requested to be included in such registration at the time of filing the registration statement, and second, among persons not contractually entitled to registration rights under this Agreement. If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to JDA and the Underwriter. Any Registrable Securities excluded or withdrawn from such underwriting shall be withdrawn from such registration. 3 5 4. DEMAND REGISTRATION. 4.1. Request for Registration. If JDA shall receive from the Initiating Holders, at any time following expiration of the three (3) month period immediately following the date of this Agreement, a written request that JDA effect a registration of the Registrable Securities, JDA will: (a) within fifteen (15) days of receipt thereof, give written notice of the proposed registration to all other Holders (a "DEMAND NOTICE"); and (b) as soon as practicable, use its best efforts to effect such registration on Form S-3 (including, without limitation, the execution of an undertaking to file post effective amendments, appropriate qualification under applicable blue sky or other state securities laws and appropriate compliance with applicable regulations issued under the Securities Act) as may be so requested and as would permit or facilitate the sale and distribution of a portion of the Registrable Securities as are specified by the Initiating Holders in such request and by any Holders joining in such request in a written request delivered to JDA within twenty (20) days after the date of the Demand Notice; provided, however, that JDA shall not be required to register more than fifty percent (50%) of the total number of Registrable Securities. If the number of Registrable Securities requested to be registered exceeds fifty percent (50%) of the total number of Registrable Securities, then the number of shares of Registrable Securities each Holder is entitled to register shall be determined pro-rata based upon such Holder's ownership of Registrable Securities. In any event, JDA shall not be obligated to effect, or to take any action to effect, any such registration pursuant to this Section 4: (i) In any particular jurisdiction in which JDA would be required to execute a general consent to service of process in effecting such registration, qualification or compliance, unless JDA is already subject to service in such jurisdiction and except as may be required by the Securities Act; (ii) If JDA has effected a prior registration pursuant to this Section 4.1 and such registration has been declared or ordered effective and the sale of such Registrable Securities has closed; (iii) If JDA has effected a prior effective registration within one hundred eighty (180) days of the Initiating Holder's request (other than a registration effected solely to qualify an employee benefit plan or to effect a business combination pursuant to Rule 145); or (iv) If the registration requested would have an aggregate disposition price (after deduction of underwriting discounts and expenses of sale) of less than $500,000. Subject to the foregoing clauses (i), (ii), (iii) and (iv), JDA 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 and joining Holders; provided, however, that if JDA shall furnish to such Initiating Holders and joining Holders a certificate signed by the President or CEO of JDA stating that in the good faith judgment of the Board of 4 6 Directors of JDA, it would be significantly detrimental to JDA and its stockholders for such registration statement to be filed on or before the time filing would be required and it is therefore essential to defer the filing of such registration statement, JDA shall have the right to defer such filing for a period of not more than ninety (90) days after receipt of the request of the Initiating Holders and joining Holders. JDA shall file such registration statement on Form S-3 to the extent that JDA is eligible to use Form S-3 for such registration. 5. EXPENSES OF REGISTRATION; REGISTRATION PROCEDURE. 5.1. Expenses of Registration. JDA shall pay all Registration Expenses incurred in connection with any demand registration on Form S-3 pursuant to Section 4 and all Piggyback Registrations pursuant to Section 3, provided, however, that JDA shall not be required to pay any Registration Expenses if, as a result of the withdrawal of a request for registration by Initiating Holders, the registration statement does not become effective, unless such withdrawal is caused by a material adverse change in the business or operations of JDA and such material adverse change was not known to the Initiating Holders at the time of the request, or unless the Initiating Holders agree to have such registration considered a registration for the purposes of Section 4.1(b)(ii). If JDA is not required to pay any Registration Expenses, then the Holders seeking to participate in such registration shall bear such Registration Expenses pro rata on the basis of the number of their shares included in the registration request, and such registration shall not be considered a registration for purposes of Section 4.1(b)(ii). 5.2. Registration Procedure. In the case of each registration effected by JDA pursuant to Sections 3 or 4, JDA will keep each Holder advised in writing as to the initiation of each registration and as to the completion thereof. At its expense, JDA will: (a) Maintain and keep such registration effective or current for a period of one hundred eighty (180) days or until the Holders have completed the distribution described in the registration statement relating thereto, whichever first occurs; provided, however, that (i) such one hundred eighty (180) day period shall be extended for a period of time equal to the period the Holders refrain from selling any securities included in such registration at the request of an underwriter of Common Stock (or other securities) of JDA; and (ii) in the case of any registration of Registrable Securities on Form S-3 which are intended to be offered on a continuous or delayed basis, such one hundred eighty (180) day period shall be extended, if necessary, to keep the registration statement effective until all such Registrable Securities are sold, however, in no event longer than one (1) year from the effective date of the registration statement and provided that Rule 145, or any successor rule under the Securities Act governing the obligation to file a post-effective amendment permit, in lieu of filing a post-effective amendment that (I) includes any prospectus required by Section 10(a)(3) of the Securities Act or (II) reflects facts or events representing a material or fundamental change in the information set forth in the registration statement, the incorporation by reference of information required to be included in (I) or (II) above to be contained in periodic reports filed pursuant to Section 13 or 15(d) of the Exchange Act in the registration statement; (b) Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectuses used in connection with such registration 5 7 statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement; (c) Furnish such number of prospectuses and other documents incident thereto, including any amendment of or supplement to the prospectus, as a Holder from time to time may reasonably request; (d) Notify such seller of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading or incomplete in the light of the circumstances then existing, and at the request of any such seller, prepare and furnish to such seller a reasonable number of copies of a supplement to or an amendment of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such shares, such prospectus shall not include 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 not misleading or incomplete in light of the circumstances then existing; (e) Cause all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which similar securities issued by JDA are then listed; (f) Provide a transfer agent and registrar for all Registrable Securities registered pursuant to such registration statement and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration; and (g) Use its commercially reasonable efforts to take all other steps necessary or appropriate to effect the registration of the Registrable Securities contemplated hereby. 6. INDEMNIFICATION. 6.1. To the extent permitted by law, JDA will indemnify each Holder, if Registrable Securities held by such Holder are included in the securities with respect to which registration, qualification or compliance has been effected pursuant to this Agreement, and each underwriter, if any, and each person who controls any underwriter 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 prospectus, offering circular or other document (including any related registration statement) 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 JDA of the Securities Act including any rule or regulation thereunder applicable to JDA relating to action or inaction required of JDA in connection with any such registration, qualification or compliance, and will reimburse each such Holder, each of its officers, directors and partners, and each person controlling such Holder, each 6 8 such underwriter and each person who controls any such underwriter, for any legal and any other expenses reasonably incurred in connection with investigating and defending any such claim, loss, damage, liability or action, provided that JDA 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 alleged untrue statement) or omission (or alleged omission) based upon information furnished to JDA specifically for inclusion therein by such Holder, each of its officers, directors and partners, and each person controlling such Holder or underwriter and each person who controls any such. 6.2. Each Holder will, if Registrable Securities or other securities held by such Holder are included in the securities as to which such registration, qualification or compliance is being effected, indemnify JDA, each of its directors, officers and agents and each underwriter, if any, of JDA's securities covered by such a registration statement, each person who controls JDA or such underwriter within the meaning of Section 15 of the Securities Act, each other such Holder and each of their officers, directors and partners, 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, in light of the circumstances in which they were made, not misleading, and will reimburse JDA and such Holders, directors, officers, agents, partners, 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 information furnished to JDA specifically for inclusion therein by such Holder. In no event shall the aggregate liability of a Holder for indemnification under this Section 6 exceed the gross proceeds received by such Holder from the sale of shares in such offering. 6.3. Each party entitled to indemnification under this Section 6 (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 any litigation resulting therefrom, 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 Agreement, except to the extent that the Indemnified Party is prejudiced thereby. Each Indemnified Party shall furnish such information regarding itself or the claim in question as an Indemnifying Party may reasonably request and as shall be reasonably required in connection with defense of such claim and litigation resulting therefrom. An Indemnified Party shall have the right to retain its own counsel, with the fees and expenses to be paid by the Indemnifying Party, if representation of such Indemnified Party by the counsel retained by the Indemnifying Party would be 7 9 inappropriate due to actual or potential conflicts of interest between such Indemnified Party and any other party represented by such counsel in such proceeding, provided that in no event shall the Indemnifying Party be required to pay the fees and expenses of more than one such separate counsel for all Indemnified Parties. 6.4. If the indemnification provided for in this Section 6 is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any losses, claims, damages or liabilities referred to herein, the Indemnifying Party, in lieu of indemnifying such Indemnified Party thereunder, shall to the extent permitted by applicable law contribute to the amount paid or payable by such Indemnified Party as the result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the allegation(s) that resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties' relevant intent, knowledge, access to information and opportunity to correct or prevent such statement or omission; provided, that in no event shall any contribution by a Holder hereunder exceed the gross proceeds from the sale of shares in the offering received by such Holder. 6.5. The obligations of JDA and Holders under this Section 6 shall survive the completion of any offering of Registrable Securities in a registration statement and the termination of this Agreement. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the prior written consent of each Indemnified Party (which consent shall not be unreasonably withheld), consent to the entry of any judgment or enter into any settlement. Unless waived by the Indemnified Party, all judgments and settlements must 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. 7. RULE 144 REPORTING. With a view to making available the benefits of certain rules and regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, JDA agrees to: 7.1. Make and keep public information available as those terms are understood and defined in Rule 144 under the Securities Act; 7.2. Use its best efforts to file with the SEC in a timely manner all reports and other documents required of JDA under the Securities Act and the Exchange Act. 7.3. So long as a Holder owns any restricted securities under Rule 144, furnish to the Holder forthwith upon request a written statement by JDA as to its compliance with the reporting requirements of Rule 144, and of the Securities Act and the Exchange Act. 8. LOCKUP AGREEMENT. In consideration for JDA's obligations under this Agreement, each Holder of Registrable Securities and each transferee pursuant to Section 10.1 8 10 hereof agrees, in connection with any registration of JDA's securities with respect to which the Holders are permitted to include at least fifty percent (50%) of the Registrable Securities requested to be registered by the Holders, upon request of JDA or the underwriters managing any underwritten offering of JDA's securities, that he, she or it shall not, directly or indirectly, sell, offer to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to be similarly bound) any Registrable Securities (other than those included in the registration) without the prior written consent of JDA or such underwriters, as the case may be, for up to one hundred twenty (120) days from the effective date of such registration; provided, however, that all persons entitled to registration rights with respect to shares of Common Stock who are not parties to this Agreement, all other persons selling shares of Common Stock in such offering, and all executive officers and directors of the Company shall also have agreed not to sell publicly their Common Stock under the circumstances and pursuant to the terms substantially equivalent to those requested of the Holders pursuant to this Section 8. Each Holder agrees that JDA may instruct its transfer agent to place stop transfer notations in its records to enforce the provisions of this Section 8. 9. TERMINATION OF RIGHTS. Unless otherwise provided herein, the rights and provisions of this Agreement shall terminate upon the earlier to occur of (i) such time as any Holder is able to sell all of his, her or its Registrable Securities in any ninety (90) day period pursuant to Rule 144 promulgated under the Securities Act without regard to volume limitations; and (ii) two (2) years from the date of this Agreement. 10. MISCELLANEOUS. 10.1. Transfer or Assignment of Registration Rights. The rights to cause JDA to register the Holder's securities granted by JDA under Sections 3 and 4 hereof may be transferred or assigned by the Holder to a transferee or assignee of any of the Registrable Securities, provided that JDA is given written notice by such Holder at the time of said transfer or assignment, stating the name and address of said transferee or assignee and identifying the securities with respect to which such registration rights are being transferred or assigned; and provided further that (i) such transferee is a constituent, partner, affiliate, member, family member of transferor, or a trust or subsidiary controlled by the transferor, (ii) after giving effect to such transfer, the transferee holds at least 150,000 shares of Registrable Securities (appropriately adjusted for recapitalizations, stock combinations, stock splits, dividends and the like), or (iii) the transferee acquires the Registrable Securities for no consideration or by gift or devise; and provided further that the transferee or assignee of such rights is not deemed by the Board of Directors of JDA, in its reasonable judgment, to be a competitor of JDA; and provided further that the transferee or assignee of such rights assumes the obligations of a Holder under this Agreement and, without any further action of the parties hereto, becomes a Holder under this Agreement. 10.2. Governing Law. This Agreement shall be governed by and construed under the laws of the State of Delaware as applied to agreements entered into solely between residents of and to be performed entirely within such state. 9 11 10.3. Counterparts; Facsimiles. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile copies of this Agreement shall be deemed originals in all respects. 10.4. Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 10.5. Notices. All notices and other communications hereunder shall be in writing and shall be deemed given when received if delivered personally or by commercial delivery service (with signature acknowledging receipt), or sent via facsimile (with confirmation of receipt), or within seventy-two (72) hours after being mailed by registered or certified mail (return receipt requested), in each case, to the parties at the following addresses (or at such other address for a party as shall be specified by like notice): (a) if to JDA, to: JDA Software Group, Inc. 14400 N. 87th Street Scottsdale, Arizona 85260-3649 Attention: James D. Armstrong Fax: (480) 308-4265 Tel: (480) 308-3014 with a copy to: JDA Software Group, Inc. 14400 N. 87th Street Scottsdale, Arizona 85260-3649 Attention: Michael Bridge, Esq. Fax: (480) 308-4268 Tel: (480) 308-3460 with a copy to: Gray Cary Ware & Freidenrich LLP 1221 South MoPac Expressway, Suite 400 Austin, Texas 78746-6875 Attention: Paul E. Hurdlow, Esq. Fax: (512) 457-7020 Tel: (512) 457-7001 (b) if to Holders, to the addresses listed on Exhibit A. 10.6. Expenses. If any action at law or in equity (including arbitration) is necessary to enforce or interpret the terms of this Agreement, the prevailing party shall be 10 12 entitled to reasonable attorneys' fees, expenses and necessary disbursements in addition to any other relief to which such party may be entitled. 10.7. Amendments and Waivers. Any term of this Agreement may be amended with the written consent of the Board of Directors of JDA and the Holders of at least a majority of the then outstanding Registrable Securities. Any amendment or waiver effected in accordance with this Section 10.7 shall be binding upon the Holders, each transferee of the Registrable Securities, each future holder of all such Registrable Securities, and JDA. 10.8. Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, portions of such provisions, or such provisions in their entirety, to the extent necessary, shall be severed from this Agreement, and the balance of the Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms. 10.9. Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party to this Agreement, upon any breach or default of the other party, shall impair any such right, power or remedy of such non-breaching party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must be made in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement, or by law or otherwise afforded to any Holder, shall be cumulative and not alternative. 10.10. Entire Agreement. This Agreement and the documents referred to herein constitute the entire agreement between the parties hereto pertaining to the subject matter hereof and any other written or oral agreements between the parties hereto are expressly canceled. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] 11 13 IN WITNESS WHEREOF, the parties hereto have executed this Registration Rights Agreement of the day and year first above written. COMPANY: JDA SOFTWARE GROUP, INC., a Delaware corporation By: ------------------------------------ Name: ---------------------------------- Title: --------------------------------- Address: ------------------------------- ------------------------------- (Fax) -------------------------- SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT 14 HOLDERS: ---------------------------------------- Printed Name: -------------------------- SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT 15 EXHIBIT A HOLDERS Anders H. Herlitz 1010 Seminole Dr. Apt. 1705 Ft. Lauderdale, Florida 33304 Christina R. Herlitz 1010 Seminole Dr. Apt. 1705 Ft. Lauderdale, Florida 33304 Carl H. Herlitz 125 Old Blaisdell Road Sutton, NH 03273 Jan W. Herlitz 1010 Seminole Dr. Apt. 1705 Ft. Lauderdale, Florida 33304 Frank K. Schuster 9610 Club South Circle, #4110 Sarasota, Florida 34238 William H. Huther 11291 Long Water Chase Ct. Gulf Harbour Y&CL Ft. Myers, Florida 33908-4952 Daniel J. Craddock 1208 Fenmore Hall Powder Springs, Georgia 30127 Kenneth Axelsson 240 Galsworthy Court Roswell, GA 30075 Bjorn Uttergard Hagvagen 7 185 32 Vaxholm Sweden 16 Ove Andre TSV 36 S-18134 Lidingo Sweden Fitz-Lennart Egnell Varlavagen 92 S-11522 Stockholm Sweden Bjorn Valsinger 6 Loxton Place Forestville N.S.W. 2087 Australia EX-99.1 5 p65597ex99-1.txt EX-99.1 1 EXHIBIT 99.1 JDA SOFTWARE GROUP, INC. INVESTOR RELATIONS CONTACT: NEWS RELEASE Lawrence Delaney, Jr., The Berlin Group PH: (310) 577-5282; Email: larry@berlingroup.com JDA PUBLIC RELATIONS CONTACT: Maureen N. Tuskai, Director, Corporate Communications Phone: (480) 308-3233; Email: maureen.tuskai@jda.com -------------------------------------------------------------------------------- JDA SOFTWARE ACQUIRES E3, WORLD'S LEADING PROVIDER OF INVENTORY OPTIMIZATION SOLUTIONS Acquisition Extends JDA's Reach up the Supply Chain with Integrated CPFR Software SCOTTSDALE, ARIZ. - SEPTEMBER 10, 2001 - JDA(R) SOFTWARE GROUP, INC. (Nasdaq: JDAS) announced today the acquisition of E3 CORPORATION, the global leader of inventory optimization systems. Founded in 1980, privately held E3 has helped over 550 retailers, wholesalers, distributors and manufacturers in 20 countries to maximize their inventory decisions with computer assisted ordering and replenishment systems. With this acquisition, JDA has once again executed upon its proven strategy to broaden its JDA Portfolio(TM) with complementary products such as industry frontrunner, E3TRIM(TM) replenishment system, and E3's new Collaborative, Planning, Forecasting and Replenishment (CPFR) solutions. "In our drive to reach the $500 million mark, we will continue to build or acquire solutions that offer unlimited growth potential," commented JDA CEO JIM ARMSTRONG. "By acquiring a market leader such as E3, we have immediately gained the highest level of market share in the inventory replenishment space. Importantly, with approximately half of E3's clients being non-retail, we will accelerate our CPFR initiative by gaining presence in the wholesale and distribution industries, which we had already targeted for growth." Added Armstrong, "With 32 offices in 17 countries servicing clients in over 60 nations, JDA's global sales and delivery infrastructure is perfectly suited to acquisitions of this nature. Starting today we will leverage our capabilities to position E3 with the remainder of our 4,000 plus clients and unlimited prospects." Commenting on the acquisition, ANDERS H. HERLITZ, E3'S FOUNDER AND CHAIRMAN, said, "JDA has been our partner and our competitor for many years, and we have been mutually successful on both counts. With the match between our offerings being nearly perfect, it made sense for us to work together to benefit our clients. Our total solution has vast potential for improving customer ROI. Of even greater importance is the fact that we are now a single company offering a single product portfolio to an enlarged marketplace." ACQUISITION TERMS JDA acquired E3 for $20 million dollars in cash and 1.6 million shares of JDA Common Stock for a purchase price of approximately $50 million dollars. E3's revenues for the 12 months ending June 30, 2001 were $44.3 million including $21.1 million of software and $13.1 million in maintenance. JDA will incur a one-time charge of $2.2 million for in-process research and development costs and the related tax benefit in third quarter 2001. Excluding this charge, JDA expects the E3 acquisition to be neutral to earnings in third quarter and solidly accretive in future quarters. The Company also expects to spend an additional $10 to $12 million for merger-related costs and to take advantage of operating synergies, which will bring the total cost 2 Add 1 JDA Acquires E3 of the acquisition to approximately $60 million. Banc of America Securities LLC acted as financial advisor to JDA. First Union Securities acted as financial advisor to E3 Corporation. JDA TO TARGET UNIX MARKET WITH NEXT GENERATION E3TRIM A key factor influencing JDA's acquisition was E3's readiness to launch UNIX versions of its leading E3TRIM replenishment product. "Since approximately 110 of our clients are also E3 users, we have a real appreciation for this solution's power and have long viewed E3 as the best brand in forecast-based replenishment," commented JDA PRESIDENT, HAMISH BREWER. "The imminent availability of the UNIX version gives us a much broader opportunity base and strongly supports our tier one growth strategy." Affirming that E3 has set the standard for inventory replenishment, PETER CHARNESS, JDA'S SENIOR VICE PRESIDENT, MARKETING AND CHIEF PRODUCT OFFICER, said, "E3's next generation replenishment solutions are based on over 20 years of deep intellectual capital as well as proven best practices in computer assisted ordering. No other competitive product comes close to the depth of functionality that these applications deliver. With E3 now part of JDA Portfolio, we are confident that E3TRIM will assume the same leadership position in the UNIX-market as the solution has already achieved with its current customers." JDA TO DELIVER PREVAILING RESPONSE TO CPFR INITIATIVE JDA is also optimistic about the opportunities that will result by merging its CPFR efforts with E3's initiatives, including an existing Application Service Provider (ASP) delivery model for its solutions. With the vision of enabling manufacturers, distributors, and retailers to work from a single, shared demand forecast, E3 will now be able to hasten and enhance its progress as part of JDA. Commented JDA's Brewer, "We are very excited about the impressive strides that E3 has made driving collaborative replenishment solutions between retailers and their suppliers. The industry is focused on this and AMR Research has even pinpointed replenishment as the most sought after solution in the collaborative field. While plenty of vendors are talking about it, E3 has actually been doing it for years." E3's CPFR solutions include more than 50 live trading partners collaborating via E3 solutions -- an unparalleled number which includes four of the top five hardware co-ops either utilizing established programs or in the process of implementing systems. KEVIN STADLER, JDA'S SENIOR VICE PRESIDENT OF COLLABORATIVE SOLUTIONS, confirmed that E3's progress supports JDA's strategy of emphasizing forecasting and replenishment as key customer focused areas that link the demand chain with the supply chain. "We'll gain an immediate kick-start in this important strategic growth area," explained Stadler. "With E3 serving as a cornerstone of our CPFR offering, we will provide the total solution that tightens production cycles, lowers safety stock requirements and reduces potential lost sales. When you combine Arthur 3 Add 2 JDA Acquires E3 Planning(TM), Intactix(TM) assortment and space management applications, JDA Intellect(TM) advanced data mining applications and the E3 products, it's clear that no other vendor in the market can come close to offering the business benefit that JDA is able to deliver." CONFERENCE CALL INFORMATION JDA will host a conference call today at 9:15 a.m. Eastern to discuss its acquisition of E3. The following telephone numbers can be used for anyone interested in participating: (800) 450-0785 (United States) or (612) 332-0530 (International) and ask the operator for the "JDA Discussion." A replay of the conference call will begin today at 11:45 a.m. Eastern and end on September 24 at 11:59 p.m. Eastern. Interested parties can hear the recall by dialing (800) 475-6701 (United States) or (320) 365-3844 (International) using Access Code 602666. Additionally, interested parties can hear the conference call over the Internet through Vcall. To listen, callers must log onto the Vcall web site, http://www.vcall.com, by 9:00 a.m. Eastern to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available on Vcall shortly after the call and a transcript will be posted to Vcall's web site 24 to 48 hours after the call. A Frequently Asked Questions document is available at http://www.jda.com under "News & Events" for more information. ABOUT JDA SOFTWARE GROUP With more than 4,300 retail, wholesale, distribution and manufacturing clients in 60 countries, JDA Software Group, Inc. (NASDAQ:JDAS) is the global leader in providing integrated software and professional services that address real-world issues to help multi-channel companies manage their mission critical operations. By capitalizing on its market position and financial strength, JDA commits significant resources in furthering its next generation of retail intelligent solutions that exploit the power of the Internet to meet emerging business needs. Founded in 1985, JDA is headquartered in Scottsdale, Arizona and employs more than 1,400 associates operating from 32 offices in major cities throughout North America, South America, Europe, Asia and Australia. For more information, visit www.jda.com. ### This press release contains forward-looking statements that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include: our strategy of broadening JDA Portfolio by building or acquiring solutions that we hope will enable us to reach $500 million in annual revenue; Mr. Armstrong's statement that we have gained the highest level of market share in the inventory replenishment space and the implication that we can maintain and leverage this market share; Mr. Armstrong's statement that we will accelerate our CPFR initiative by gaining presence in wholesale and distribution; Mr. Armstrong's statement that our global sales and delivery infrastructure is perfectly suited to acquisitions of this nature; Mr. Armstrong's statement that we will position E3 with our clients and prospects; our expectation that the 4 Add 3 JDA Acquires E3 E3 acquisition will be neutral to earnings in the third quarter, and solidly accretive in future quarters; our expectation that we will need to spend an additional $10 to $12 million for merger-related costs, and that we will be able to take advantage of operating synergies; Mr. Brewer's statement that we believe the UNIX version of E3TRIM is imminently available, and that it will strongly support out tier one growth strategy; Mr. Charness' statement that E3TRIM will assume the same leadership position in the UNIX-market as it has with its current customers; Mr. Stadler's statements regarding our ability to combine our and E3's CPFR efforts to kick-start CPFR as an important strategic growth area for us. Future events may involve risks and uncertainties, including, but not limited to, uncertainties related to our ability to: successfully assimilate into JDA both the E3 products and services, and the E3 employees to help us achieve our $500 million annual revenue goal; our ability to maintain and enhance E3's market-leading position in the inventory replenishment space, particularly since many of E3's customers are wholesalers and distributors, who are not part of our traditional retail market; successfully use our existing sales and delivery infrastructure to integrate E3's products, services, employees and products, particularly since E3's office locations, products, customers and markets are different than ours; successfully back-sell E3 products into our client base; achieve neutral earnings with E3 in the third quarter and solidly accretive in future quarters, particularly given the uncertain global economy; keep merger-related costs to $10 to $12 million and achieve operating synergies, particularly given the complexity of combining two global companies; complete the development of the new UNIX version of E3TRIM in a timely, cost-efficient and technically viable manner, and to integrate this new version with our other products, particularly our UNIX-based merchandise system, ODBMS; leverage the E3 acquisition to further our efforts to enter the CPFR market; and other risks detailed from time to time in the "Risk Factors" section of our filings with the Securities and Exchange Commission. As a result of these and other risks, actual results may differ materially from those predicted. We undertake no obligation to update information in this release. In addition to the specific risks identified in the proceeding paragraph, acquisitions involve a number of special risks, including diversion of management's attention to the assimilation of the operations and personnel of acquired businesses, costs related to the acquisition and the integration of acquired businesses, products, technologies and employees into our business and product offerings. Achieving the anticipated benefits of any acquisition will depend, in part, upon whether the integration of the acquired business, products, technology, or employees is accomplished in an efficient and effective manner, and there can be no assurance that this will occur. The difficulties of such integration may be increased by the necessity of coordinating geographically disparate organizations, the complexity of the technologies being integrated, and the necessity of integrating personnel with disparate business backgrounds and combining different corporate cultures. The inability of management to successfully integrate any acquisition we may pursue, and any related diversion of management's attention, could have a material adverse effect on our business, operating results and financial condition. Moreover, there can be no assurance that any products acquired will gain acceptance in our markets, that we will be able to penetrate new markets successfully or that we will obtain the anticipated or desired benefits of such acquisitions. Any acquisition we pursue or consummate could result our incurring debt and contingent liabilities, amortization of goodwill and other intangibles, purchased research and development expense, other acquisition-related expenses and the loss of key employees, any of which items could have a material adverse effect on our business, operating results and financial condition. JDA is a registered trademark with the United States Patent and Trademark Office. E3TRIM, JDA Arthur Planning, JDA Intellect and JDA Portfolio are trademarks of JDA Software Group, Inc. All other company, product or services names referenced in this release may be registered trademarks or trademarks of their respective owners.

EX-2.1

   1
                                                                     EXHIBIT 2.1

                      AGREEMENT AND PLAN OF REORGANIZATION


                                      among


                            JDA SOFTWARE GROUP, INC.,
                             a Delaware corporation
                                    ("JDA"),


                              E3 ACQUISITION CORP.,
                     a Delaware corporation and wholly-owned
                               subsidiary of JDA,


                                 E3 CORPORATION,
                              a Georgia corporation
                                     ("E3"),


                                       and


                                THE SHAREHOLDERS
                                       of
                                       E3


                          Dated as of September 7, 2001
   2


                                TABLE OF CONTENTS

                                                                                              Page
                                                                                           
ARTICLE I        THE MERGER.................................................................     1
        Section 1.1   Effective Time of the Merger..........................................     1
        Section 1.2   Closing...............................................................     1
        Section 1.3   Effects of the Merger.................................................     2
        Section 1.4   Directors and Officers................................................     2

ARTICLE II       CONVERSION OF SECURITIES...................................................     2
        Section 2.1   Certain Definitions...................................................     2
        Section 2.2   Conversion of E3 Capital Stock; Payment of Indebtedness...............    10
        Section 2.3   Surrender of Certificates.............................................    12
        Section 2.4   Ancillary Agreements..................................................    13
        Section 2.5   Escrow................................................................    13
        Section 2.6   Certificate Legends...................................................    14
        Section 2.7   Treatment of E3 Options...............................................    15

ARTICLE III      REPRESENTATIONS AND WARRANTIES OF E3.......................................    15
        Section 3.1   Organization, Standing, Power and Subsidiaries........................    15
        Section 3.2   E3 Capital Structure..................................................    16
        Section 3.3   Authority; Required Filings and Consents..............................    16
        Section 3.4   Financial Statements..................................................    17
        Section 3.5   Absence of Undisclosed Liabilities....................................    18
        Section 3.6   Absence of Certain Changes or Events..................................    18
        Section 3.7   Taxes.................................................................    19
        Section 3.8   Tangible Assets and Real Property.....................................    21
        Section 3.9   Intellectual Property.................................................    22
        Section 3.10  Bank Accounts.........................................................    24
        Section 3.11  Contracts.............................................................    24
        Section 3.12  Labor Difficulties....................................................    26
        Section 3.13   Trade Regulation.....................................................    27
        Section 3.14  Environmental Matters.................................................    27
        Section 3.15  Employee Benefit Plans................................................    28
        Section 3.16  Compliance with Laws..................................................    31
        Section 3.17  Employees and Consultants.............................................    31
        Section 3.18  Litigation............................................................    32
        Section 3.19  Restrictions on Business Activities...................................    33
        Section 3.20  Governmental Authorization............................................    33
        Section 3.21  Insurance.............................................................    33
        Section 3.22  Interested Party Transactions.........................................    33
        Section 3.23  No Existing Discussions...............................................    34
        Section 3.24  Real Property Holding Corporation.....................................    34
        Section 3.25  Corporate Documents...................................................    34
        Section 3.26  Aliens................................................................    34
        Section 3.27  Indemnification Claims................................................    35
        Section 3.28  Power of Attorney.....................................................    35
        Section 3.29  No Misrepresentation..................................................    35



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                                TABLE OF CONTENTS

                                                                                              Page
                                                                                           
ARTICLE IIIA     REPRESENTATIONS AND WARRANTIES OF EACH SIGNING
                 SHAREHOLDER................................................................    35
        Section 3A.1  Ownership and Status of E3 Common Stock...............................    35
        Section 3A.2  Power of the Signing Shareholder; Approval of the Merger..............    36
        Section 3A.3  No Conflicts or Litigation............................................    36
        Section 3A.4  Preemptive and Other Rights; Waiver...................................    36
        Section 3A.5  Accredited Investor Status; Sophistication............................    37

ARTICLE IV       REPRESENTATIONS AND WARRANTIES OF JDA AND SUB..............................    37
        Section 4.1   Organization..........................................................    37
        Section 4.2   JDA Capital Structure.................................................    37
        Section 4.3   Authority; No Conflict; Required Filings and Consents.................    38
        Section 4.4   SEC Filings; Financial Statements.....................................    39
        Section 4.5   Absence of Undisclosed Liabilities....................................    39
        Section 4.6   Absence of Certain Changes or Events..................................    39
        Section 4.7   Litigation............................................................    39
        Section 4.8   Board Approval and Recommendation.....................................    40
        Section 4.9   Tax Treatment.........................................................    40
        Section 4.10  No Prior Activities...................................................    40

ARTICLE V        CONDUCT OF BUSINESS........................................................    40
        [Intentionally Deleted].............................................................    40

ARTICLE VI       ADDITIONAL AGREEMENTS......................................................    40
        Section 6.1   No Solicitation.......................................................    40
        Section 6.2   Access to Information.................................................    40
        Section 6.3   Legal Conditions to Merger............................................    40
        Section 6.4   Public Disclosure.....................................................    40
        Section 6.5   Tax-Free Reorganization...............................................    40
        Section 6.6   E3 401(k) Plan........................................................    41
        Section 6.7   Brokers or Finders....................................................    41
        Section 6.8   Additional Agreements; Reasonable Efforts.............................    41
        Section 6.9   Expenses..............................................................    41
        Section 6.10  Updating Schedules....................................................    42
        Section 6.11  Directors and Officers of Subsidiaries................................    42

ARTICLE VII      CONDITIONS TO MERGER.......................................................    42
        Section 7.1   Conditions to Each Party's Obligation to Effect the Merger............    42
        Section 7.2   Additional Conditions to Obligations of JDA and Sub...................    43
        Section 7.3   Additional Conditions to Obligations of E3............................    44

ARTICLE VIII     TERMINATION AND AMENDMENT..................................................    46
        [Intentionally Deleted].............................................................    46

ARTICLE IX       INDEMNIFICATION............................................................    46
        Section 9.1   Survival of Representations and Warranties............................    46
        Section 9.2   Indemnification by Shareholders.......................................    46
        Section 9.3   Procedures for Indemnification........................................    47



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                                TABLE OF CONTENTS

                                                                                              Page
                                                                                           
        Section 9.4   Defense of Third Party Claims.........................................    47
        Section 9.5   Settlement of Third Party Claims......................................    48
        Section 9.6   Manner of Indemnification; Excess Indemnification by Indemnifying
                      Shareholders..........................................................    48
        Section 9.7   Appointment of Shareholders' Representative...........................    49
        Section 9.8   Indemnification of Shareholders' Representative.......................    50
        Section 9.9   Post Closing Indemnification..........................................    50

ARTICLE X        GENERAL PROVISIONS.........................................................    51
        Section 10.1  Notices...............................................................    51
        Section 10.2  Interpretation........................................................    52
        Section 10.3  Counterparts..........................................................    52
        Section 10.4  Severability..........................................................    52
        Section 10.5  Entire Agreement......................................................    52
        Section 10.6  Governing Law.........................................................    53
        Section 10.7  Assignment............................................................    53
        Section 10.8  Third Party Beneficiaries.............................................    53
        Section 10.9  Release...............................................................    53
        Section 10.10 Gender................................................................    54





EXHIBITS

                   
Exhibit A             List of E3 Signing Shareholders
Exhibit B             Escrow Agreement
Exhibit C             July Balance Sheet
Exhibit D             March Balance Sheet
Exhibit E             Shareholder's Certificate
Exhibit F             E3 Tax Certificate
Exhibit G             JDA Tax Certificate
Exhibit H             Medical Benefits Agreement
Exhibit I             Opinion of Morris, Manning & Martin, LLP
Exhibit J             Non-Competition and Non-Solicitation Agreement
Exhibit K             Opinion of Gray Cary Ware & Freidenrich LLP
Exhibit L             Registration Rights Agreement
Exhibit M             Indemnification Schedule

SCHEDULES

Schedule 1.4          Initial Directors and Officers of the Surviving Corporation
Schedule 2.2(b)       Merger Consideration Payable to Shareholders
Schedule 3.1          Liens
Schedule 3.9(j)       List of Employee or Consultants Who Developed Intellectual Property
Schedule 3.17(b)      Employee Contracts, Agreements, Plans or Commitments
Schedule 6.7          Brokers and Finders Fees
Schedule 7.2(d)       Required Consents
Schedule 7.2(j)       List of Individuals for Proprietary Information and Inventions Assignment
                      Agreement



                                   iii
   5
                      AGREEMENT AND PLAN OF REORGANIZATION

      THIS AGREEMENT AND PLAN OF REORGANIZATION (this "AGREEMENT") is made and
entered into as of September 7, 2001 by and among JDA Software Group, Inc., a
Delaware corporation ("JDA"), E3 Acquisition Corp., a Delaware corporation and
wholly-owned subsidiary of JDA ("SUB"), E3 Corporation, a Georgia corporation
("E3"), and certain of the shareholders of E3 listed on Exhibit A attached
hereto (individually, a "SIGNING SHAREHOLDER" and collectively, the "SIGNING
SHAREHOLDERS").

                                    RECITALS

      WHEREAS, the Board of Directors of each of JDA, Sub and E3 deems it
advisable and in the best interests of its respective corporation and the
shareholders of its respective corporation that JDA and E3 combine in order to
advance the long-term business interests of JDA and E3;

      WHEREAS, the combination of JDA and E3 shall be effected by the terms of
this Agreement through a transaction (the "MERGER") in which E3 will merge with
and into Sub, Sub will remain a wholly-owned subsidiary of JDA and the
shareholders of E3 receive a combination of cash and JDA Common Stock; and

      WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a) of the
Code.

      NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth below, the
parties agree as follows:

                                   ARTICLE I

                                   THE MERGER

      Section 1.1 Effective Time of the Merger. Subject to the provisions of
this Agreement, a certificate of merger (the "CERTIFICATE OF MERGER") in such
form as is required by the relevant provisions of the Delaware General
Corporation Law and the Georgia Business Corporation Code shall be duly
prepared, executed and acknowledged by the Surviving Corporation (as defined in
Section 2.1) and delivered to the Delaware Secretary of State and the Georgia
Secretary of State for filing as soon as practicable after the Closing (as
defined in Section 1.2). Unless otherwise provided in the Certificate of Merger,
the Merger shall become effective upon the filing of the Certificate of Merger
with the Delaware Secretary of State and the Georgia Secretary of State (the
"EFFECTIVE TIME").

      Section 1.2 Closing. The closing of the Merger (the "CLOSING") will take
place at 4:30 p.m., Eastern Time, on a date to be specified by JDA and E3 (the
"CLOSING DATE"), which shall be no later than the second business day after the
latest to occur of the satisfaction or waiver of all of the conditions set forth
in Sections 7.1, 7.2(b) (other than the delivery of the officers'


                                       1
   6
certificate referred to therein) and 7.3(b) (other than the delivery of the
officers' certificate referred to therein), provided that the other closing
conditions set forth in Article VII have been met or waived as provided in
Article VII at or prior to the Closing, at the offices of Morris, Manning &
Martin, LLP, 1600 Atlanta Financial Center, 3343 Peachtree Road, NE, Atlanta,
Georgia 30326-1022 unless another time, date or place is agreed to in writing by
JDA and E3, further provided that the Closing Date shall be on or before
September 10, 2001 in any case.

      Section 1.3 Effects of the Merger.

            (a)   At the Effective Time (i) the separate existence of E3 shall
cease, and E3 shall be merged with and into Sub, (ii) the Certificate of
Incorporation of Sub shall be amended so that Article First of such Certificate
of Incorporation shall read as follows: "The name of the corporation is JDA-E3
Corporation" and, as so amended, such Certificate of Incorporation shall be the
Certificate of Incorporation of the Surviving Corporation, and (iii) the Bylaws
of Sub as in effect immediately prior to the Effective Time shall be the Bylaws
of the Surviving Corporation.

            (b)   The Merger shall have the effects set forth in this Agreement
and the DGCL and the GBCC. At and after the Effective Time, the Surviving
Corporation shall possess all the rights, privileges, powers and franchises of a
public as well as of a private nature, and be subject to all the restrictions,
disabilities and duties of each of the Constituent Corporations; and all and
singular rights, privileges, powers and franchises of each of the Constituent
Corporations, and all property, real, personal and mixed, and all debts due to
either of the Constituent Corporations on whatever account, as well as for stock
subscriptions and all other things in action or belonging to each of the
Constituent Corporations, shall be vested in the Surviving Corporation, and all
property, rights, privileges, powers and franchises, and all and every other
interest shall be thereafter as effectually the property of the Surviving
Corporation as they were of the Constituent Corporations, and the title to any
real estate vested by deed or otherwise, in either of the Constituent
Corporations, shall not revert or be in any way impaired but all rights of
creditors and all Liens upon any property of either of the Constituent
Corporations shall be preserved unimpaired, and all debts, liabilities and
duties of the Constituent Corporations shall thereafter attach to the Surviving
Corporation, and may be enforced against it to the same extent as if such debts
and liabilities had been incurred by it.

      Section 1.4 Directors and Officers. The initial directors and officers of
the Surviving Corporation shall be the persons identified on Schedule 1.4
hereto, each of whom will hold office in accordance with the Certificate of
Incorporation and Bylaws of the Surviving Corporation until their respective
successors are duly elected or appointed.

                                   ARTICLE II

                            CONVERSION OF SECURITIES

      Section 2.1 Certain Definitions. For purposes of this Agreement, the
following terms shall have the meanings set forth below:

            "ACQUIRED ENTITY" means E3 or any of the E3 Subsidiaries,
collectively the "ACQUIRED ENTITIES."


                                       2
   7
            "ASSUMED OPTION" means each E3 Option so assumed by JDA under this
Agreement.

            "BALANCE SHEET DATE" means July 31, 2001.

            "BANK DEBT" means the indebtedness of E3 (including the principal
borrowed plus any accrued and unpaid interests and other fees of any kind
related thereto) to First Union National Bank under the Amended and Restated
Loan and Security Agreement, dated June 1, 2000, as amended, by and between E3
and First Union National Bank. E3 represents and warrants that the outstanding
principal and interest amount of such indebtedness, together with any related
accrued fees or expenses payable to First Union National Bank, as of and through
September 10, 2001 is $8,180,25.27.

            "BENEFIT OBLIGATIONS" means the employer's aggregate financial
liability to provide all current, projected and contingent benefits to Employees
or former Employees of E3 or any Acquired Entity, or their beneficiaries or
dependents, as the case may be, under the terms of any E3 Employee Plan,
regardless of whether an amount less than such aggregate financial liability is
reflected on the employer's financial statements under applicable tax or
accounting rules.

            "CASH MERGER CONSIDERATION" means, subject to adjustment pursuant to
Section 2.2(d), $20,000,000 less the Excess E3 Transaction Expenses.

            "CLOSING BALANCE SHEET" means the unaudited consolidated E3 balance
sheet dated as of two (2) days prior to the Closing Date prepared in accordance
with past practices (other than changes directly related to any change in the
deferred revenue account resulting from changes in E3's revenue recognition
policy consistent with GAAP) and provided by E3 to JDA within ten (10) days
following the Closing Date.

            "CLOSING E3 TRANSACTION EXPENSE SCHEDULE" has the meaning given it
in Section 6.9.

            "CLOSING STOCK PRICE" means the average closing per share price of
JDA Common Stock on the NASDAQ National Market System ("NASDAQ") for the ten
consecutive trading days prior to and ending three days prior to the Closing
Date.

            "COBRA" means the Consolidated Omnibus Budget Reconciliation Act of
1985.

            "CODE" means the Internal Revenue Code of 1986, as amended.

            "CONFIDENTIALITY AGREEMENT" means the Confidentiality Agreement
dated on or about January 11, 2001 between JDA and E3.

            "CONSENTS" mean consents, authorizations, filings, approvals,
orders, clearances, permits, declarations and registrations.

            "CONSTITUENT CORPORATIONS" means Sub and E3.


                                       3
   8
            "CONSULTANT" means an individual resident in any jurisdiction who,
as of the Effective Time, is an independent contractor or an individual supplied
by a third party and who currently provides an Acquired Entity with consulting
services related to the business of such Acquired Entity.

            "CORPORATE DOCUMENTS" has the meaning given it in Section 3.25.

            "CUSTOMER LICENSE AGREEMENTS" means those license agreements entered
into with end users of an E3 Product pursuant to which E3 or an E3 Subsidiary
enjoys any right or benefit or undertakes any obligation related to any of the
E3 Products, or pursuant to which E3 or an E3 Subsidiary has granted a third
party the right to use an E3 Product.

            The phrases "THE DATE OF THIS AGREEMENT," "THE DATE HEREOF," and
terms of similar import, unless the context otherwise requires, shall be deemed
to refer to the date set forth on the cover page of this Agreement.

            "DERIVATIVE WORKS" means all modules, changes, updates,
translations, localizations, customizations, enhancements, improvements,
modifications, or adaptations to an E3 Product or with respect to E3
Intellectual Property, as such derivative works are developed by an Acquired
Entity or a third party under a license, service or support agreement regardless
of whether such agreements contain provisions assigning the derivative works to
E3.

            "DGCL" means the Delaware General Corporation Law.

            "EMPLOYEE" means an individual resident in any jurisdiction who, as
of the Effective Time, is an employee of an Acquired Entity (including active or
inactive employees).

            "EFFECTIVE TIME" has the meaning given it in Section 1.1.

            "ENVIRONMENTAL CLAIM" means any and all administrative, regulatory
or judicial actions, suits, demands, demand letters, directives, claims, writs,
injunctions, restraining orders, Liens, investigations, proceedings or notices
of noncompliance or violation by any person or entity (including any
Governmental Authority) alleging liability or potential liability (including,
without limitation, potential responsibility for or liability for enforcement
costs, investigatory costs, cleanup costs, governmental response costs, removal
costs, remedial costs, natural resources damages, property damages, personal
injuries, fines or penalties) arising out of, based on or resulting from (A) the
presence, or Release or threatened Release into the environment, of any
Hazardous Materials at any location, whether or not owned, operated, leased or
managed by any Acquired Entity or any joint venture; or (B) circumstances
forming the basis of any violation, or alleged violation, of any Environmental
Law; or (C) any and all claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief resulting from
the presence or Release of any Hazardous Materials.

            "ENVIRONMENTAL LAWS" means all Laws relating to pollution, the
environment (including, without limitation, ambient air, surface water,
groundwater, land surface or subsurface strata) or protection of human health as
it relates to protection of the environment including, without limitation, Laws
relating to Releases or threatened Releases of Hazardous


                                       4
   9
Materials, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Materials.

            "ENVIRONMENTAL PERMITS" means all environmental approvals, permits,
licenses, clearances and consents.

            "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.

            "ERISA AFFILIATE" means any trade or business (whether or not
incorporated) which is or, at any relevant time, was treated as a single
employer with E3 within the meaning of Sections 414(b), (c), (m) or (o) of the
Code.

            "ESCROW" means the escrow arrangement set forth in Section 2.5.

            "ESCROW AGENT" means The Chase Manhattan Bank.

            "ESCROW AGREEMENT" means the escrow agreement in substantially the
form of Exhibit B attached hereto.

            "ESCROW PAYMENT" has the meaning given it in Section 9.6(a).

            "ESCROWED CASH" means a dollar amount equal to ten percent (10%) of
the Cash Merger Consideration.

            "ESCROWED CONSIDERATION" means the Escrowed Cash and the Escrowed
Shares.

            "ESCROWED SHARES" means the number of shares (rounded to the nearest
whole share) equal to ten percent (10%) of the Stock Merger Consideration.

            "ESTIMATED E3 TRANSACTION EXPENSES" has the meaning given it in
Section 6.9.

            "E3 AUTHORIZATIONS" has the meaning given it in Section 3.20.

            "E3 CAPITAL STOCK" means the E3 Common Stock, including shares
issuable upon exercise of or conversion of outstanding vested stock options,
warrants, convertible promissory notes or other convertible securities.

            "E3 COMMON STOCK" means the Common Stock, par value $0.05, of E3.

            "E3 DISCLOSURE SCHEDULES" means the disclosure schedules to Article
III and Article IIIA provided by E3 prior to or on the date hereof.

            "E3 EMPLOYEE PLAN(S)" has the meaning given it in Section 3.15(a).

            "E3 FINANCIAL STATEMENTS" has the meaning given it in Section 3.4.

            "E3 FOREIGN SUBSIDIARY NOTES" means the promissory notes evidencing
any indebtedness for monies borrowed by a foreign Subsidiary of E3 to E3,
including without


                                       5
   10
limitation those promissory notes endorsed by E3 to First Union National Bank as
a security interest under the Loan Agreement. A list of the E3 Foreign
Subsidiary Notes are listed in the E3 Disclosure Schedule.

            "E3 INTELLECTUAL PROPERTY RIGHTS" has the meaning given it in
Section 3.9(a).

            "E3 INTERNATIONAL EMPLOYEE PLANS" has the meaning given it in
Section 3.15(a).

            "E3 OPTION" means each outstanding option to purchase shares of E3
Common Stock.

            "E3 PRODUCT" has the meaning given it in Section 3.9(b).

            "E3 STOCK OPTION PLAN" means the E3 Corporation Stock Incentive
Plan.

            "E3 SUBSIDIARIES" means E3 Australia Pty Ltd ACN 090 583 798, E3
Mexico S.A. de C.V., E3 Soluciones en Inventario, S.A. de C.V., E3 ESPANA
INCORPORATED, S.A., E3 United Kingdom Limited, E3 France, societe anonyme, E3
(Deutchland) GmbH, E3 Italia S.r.l., E3 Norge AS, E3 International Ltd. (FSC-St.
Thomas, USVI), E3 North America, Inc., Inventory Management Institute, Inc., E3
Norden Aktiebolag, E3 Danmark ApS and E3 Suomi Logistics Oy.

            "E3 TRANSACTION EXPENSES" has the meaning given it in Section 6.9.

            "E3 U.S. EMPLOYEE PLAN" has the meaning given it in Section
3.15(a)(i).

            "E3'S KNOWLEDGE" means the actual knowledge after reasonable inquiry
of the following individuals who are reasonably believed to have knowledge, or
could be expected to have knowledge in the course of conducting a reasonably
comprehensive investigation, concerning the existence of such matters: E3's
directors, corporate officers (with a title of president or vice-president,
including the President - Europe), senior legal counsel and senior regional
managers (who may be employees of an Acquired Entity rather than employees of
E3). In the case of senior regional managers, in the event such senior regional
managers are not fluent in a local language, E3's Knowledge shall be deemed to
include a reasonable inquiry of the senior local manager who is fluent in that
local language. In addition, any reference to the "knowledge of E3" shall
include the knowledge of each of the Shareholders.

            "EXCESS E3 TRANSACTION EXPENSES" means E3 Transaction Expenses
greater than $1,550,000, and any amounts paid by E3 for an investment advisor's
fairness opinion and any amounts paid by E3 to investment advisors in excess of
$850,000. For purposes of calculating any expenses denominated in foreign
currencies, the parties will use the exchange rates published in the Wall Street
Journal on the date of this Agreement.

            "EXCESS INDEMNIFICATION LIABILITY CAP" means, with respect to any
Indemnification Claim for breach of a representation or warranty contained in
Section 3.9, the sum total of the Indemnifying Shareholders' Pro Rata Portion of
the Merger Consideration, valued as of the Closing Date.


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   11
            "EXCHANGE ACT" means the Securities Act and the Securities Exchange
Act of 1934, as amended.

            "EXCHANGE RATIO" has the meaning set forth in Section 2.2(b)(i).

            "FLOOR AMOUNT" means $500,000.

            "GAAP" means generally accepted accounting principles.

            "GBCC" means the Georgia Business Corporation Code, as amended.

            "GOVERNMENTAL ENTITY" means any court, administrative agency or
commission or other governmental authority or instrumentality, whether
multilateral, regional, federal, state, provincial or local of any country.

            "HAZARDOUS MATERIALS" means (a) any petroleum or petroleum products,
hydrocarbons, radioactive materials, asbestos, urea formaldehyde foam insulation
and transformers of other equipment that contain dielectric fluid containing
polychlorinated biphenyls ("PCBS") in regulated concentrations; and (b) any
chemicals, materials or substances which are now defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic pollutants," or words of similar import, under any Environmental Law; and
(c) any other chemical, material, substance or waste, which is regulated under
any Environmental Law in a jurisdiction in which any Acquired Entity operates.

            "HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.

            The words "INCLUDE," "INCLUDES" and "INCLUDING" when used herein
shall be deemed in each case to be followed by the words "without limitation."

            "INDEMNIFICATION CLAIM" means a claim for indemnification under
Article IX.

            "INDEMNIFYING SHAREHOLDER" means Anders Herlitz, Carl Herlitz, Frank
Schuster, and Daniel Craddock.

            "INDEMNITEE" means the member or members of the JDA Group seeking
indemnification under Article IX.

            "INDEMNITOR" means the party against which a member of the JDA Group
is seeking indemnification under Article IX.

            "INITIAL STOCK PRICE" means $16.171 per share of JDA Common Stock.

            "IRCA" means the Immigration Reform and Control Act of 1986, as
amended.

            "JDA BALANCE SHEET" means the unaudited consolidated balance sheet
of JDA as of June 30, 2001.


                                       7
   12
            "JDA COMMON STOCK" means the Common Stock, $0.01 par value, of JDA.

            "JDA DISCLOSURE SCHEDULE" means the disclosure schedule delivered by
JDA to E3 on or before the date of this Agreement.

            "JDA GROUP" means JDA, its officers, directors, employees and
agents, all Subsidiaries and affiliates of JDA (including Sub as successor to E3
and all Subsidiaries of E3), and the respective officers, directors, employees
and agents of such entities.

            "JDA LOSSES" has the meaning given it in Section 9.2(a).

            "JDA SEC REPORTS" means forms, reports and documents required to be
filed by JDA with the SEC since January 1, 2001.

            "JULY BALANCE SHEET" means the consolidated E3 balance sheet dated
as of July 31, 2001 delivered by E3 to JDA, attached as Exhibit C hereto.

            "LAW" or "LAWS" means any constitution, statute, law, ordinance,
decree, order, injunction, rule, directive, or regulation of any government or
quasi-governmental authority in any jurisdiction, and includes rules and
regulations of any regulatory or self-regulatory authority compliance with which
is required by Law, in effect on the date hereof, or enacted, adopted or
promulgated on or prior to the Closing Date, to the extent the same is
applicable to the business of the Acquired Entities.

            "LICENSED INTELLECTUAL PROPERTY" has the meaning given it in Section
3.9(b).

            "LIEN" means any lien, pledge, charge, claim, restriction on
transfer, mortgage, right of usufruct, option, right of first refusal or
preemptive right (whether created by statute, the charter documents of E3 or any
agreement to which E3 or any Acquired Entity is a party), purchase money and
other security interest or other encumbrance of any sort.

            "LOAN AGREEMENT" means the Amended and Restated Loan and Security
Agreement, dated June 1, 2000, as amended from time to time, by and between E3
and First Union National Bank.

            The phrase "MADE AVAILABLE" in this Agreement shall mean that the
information referred to has been (i) provided to JDA or its representatives,
(ii) made available in a data room pursuant to the request of JDA to JDA or its
representatives, or (iii) made available to JDA or its representatives at the
local office of any Acquired Entity.

            "MARCH BALANCE SHEET" means the consolidated E3 balance sheet dated
as of March 31, 2001 delivered by E3 to JDA, attached as Exhibit D hereto.

            "MARKET STOCK PRICE" means the per-share closing price of JDA Common
Stock on the NASDAQ as of the last day of trading prior to the Closing

            "MATERIAL ADVERSE EFFECT," with respect to any entity or group of
entities, means a material adverse effect on the business, liabilities, assets
(including intangible assets), financial


                                       8
   13
condition, prospects, or results of operations of such entity and its
Subsidiaries, taken as a whole. Without limiting the generality of the
foregoing, a condition or occurrence which is reasonably likely to cause the
cessation of or material interruption to the business of any Acquired Entity, or
which could reasonably be expected to result in, or which does result in, an
injunction or order prohibiting or materially interrupting the operations of any
Acquired Entity, shall be deemed a Material Adverse Effect.

            "MATERIAL TANGIBLE ASSETS" means all tangible assets and properties
which are material to the conduct of its business as currently conducted or
which are reflected on the July Balance Sheet or acquired since the Balance
Sheet Date.

            "MERGER CONSIDERATION" means the Stock Merger Consideration and the
Cash Merger Consideration.

            "NON-FLOOR LOSSES" means the losses, damages, costs and expenses
(including reasonable legal fees and expenses) identified as Non-Floor Losses on
Exhibit M.

            "PRE-ACQUISITION CLAIM" has the meaning given it in Section 10.9.

            "PRE-ACQUISITION MATTER" has the meaning given it in Section 10.9.

            "PRO RATA PORTION" means for each Shareholder, the percentage of the
total Merger Consideration payable to that Shareholder set forth on Schedule
2.2(b).

            "REGULATION S" means Regulation S promulgated under the Securities
Act.

            "RELEASE" means any release, spill, emission, leaking, injection,
deposit, disposal, discharge, dispersal, leaching or migration into the
atmosphere, soil, surface water, groundwater or property.

            "RELEASED PARTIES" means all past, present and future members of the
JDA Group.

            "RETURNS" means all returns, estimates, information statements and
reports required to be filed with any taxing authority.

            "SEC" means the Securities and Exchange Commission

            "SECURITIES ACT" means the Securities Act of 1933, as amended.

            "SHAREHOLDER" means each holder of record of E3 Common Stock as of
immediately prior to the Effective Time (collectively, the "SHAREHOLDERS").

            "SHAREHOLDERS' REPRESENTATIVE" means Anders Herlitz, as the
representative and attorney-in-fact for and on behalf of the Shareholders.

            "STOCK MERGER CONSIDERATION" means, subject to adjustment pursuant
to Section 2.2(c), the number of shares of JDA Common Stock obtained by dividing
$30,000,000 by the Closing Stock Price.


                                       9
   14
            "STOCK TRANSFER DOCUMENTS" has the meaning given it in Section 2.4.

            "SUBSIDIARY" means, with respect to any party, any corporation or
other organization, whether incorporated or unincorporated, of which (i) such
party or any other Subsidiary of such party is a general partner (excluding
partnerships, the general partnership interests of which held by such party or
any Subsidiary of such party do not have a majority of the voting interest in
such partnership) or (ii) such party or any Subsidiary of such party possesses,
directly or indirectly, the power to direct or cause the direction of the
management and polices of such corporation or other organization, whether
through the ownership of voting securities, by contract or otherwise.

            "SURVIVING CORPORATION" means the Sub.

            "TAX" or, collectively, "TAXES," means, with respect to any country,
any and all federal, provincial, regional, state, city, county, possession and
local taxes, assessments and other governmental charges, duties, impositions and
liabilities, including taxes based upon or measured by gross receipts, income,
profits, sales, use, occupation and volume, quantity or weight of hazardous
wastes generated or disposed of, and value added, ad valorem, transfer,
registration, franchise, withholding, payroll, recapture, employment, windfall
profits, property, capital, severance, premium, customs, duties and excise
taxes, together with all interest, penalties and additions imposed with respect
to such amounts and any obligations under any agreements or arrangements with
any other person with respect to such amounts and including any liability for
taxes of a predecessor entity.

            "THIRD PARTY CLAIM" means any claim made or suit or proceeding
instituted against an Indemnitee which, if prosecuted successfully, would be a
matter for which such Indemnitee is entitled to indemnification under this
Article IX.

            "TRANSACTION DOCUMENTS" means all other documents required to be
executed and delivered by E3 hereunder, including without limitation the Escrow
Agreement, Registration Rights Agreement, Medical Benefits Agreements, the
Non-competition and Non-solicitation Agreement, intellectual property assignment
agreements, and the Stock Transfer Documents.

      Section 2.2 Conversion of E3 Capital Stock; Payment of Indebtedness. As of
the Effective Time, by virtue of the Merger and without any action on the part
of the holder of any shares of capital stock of E3 or capital stock of Sub:

            (a)   Capital Stock of Sub. Each issued and outstanding share of the
capital stock of Sub shall remain unchanged and such shares shall constitute all
the issued and outstanding shares of Common Stock of the Surviving Corporation.

            (b)   Conversion of E3 Common Stock. Each share of E3 Common Stock
issued and outstanding immediately prior to the Effective Time will be canceled
and extinguished and shall be converted and exchanged, without any action on the
part of the Shareholders, into the right to receive, subject to Section 2.5, the
following Merger Consideration:

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   15
                  (i)   subject to Section 2.2(c) hereof, that number of validly
issued, fully paid and nonassessable shares of JDA Common Stock equal to the
amount obtained by (x) the Stock Merger Consideration divided by (y) the number
of outstanding shares of E3 Common Stock outstanding immediately prior to the
Effective Time (the "EXCHANGE RATIO"); and

                  (ii)  subject to Section 2.2(d) hereof, the cash amount equal
to (i) the Cash Merger Consideration less the Excess E3 Transaction Expenses and
the result divided by (ii) the number of outstanding shares of E3 Common Stock
immediately prior to the Effective Time.

                  (iii) The pro-rata distribution of the Merger Consideration
for each holder of E3 Capital Stock is set forth on Schedule 2.2(b).

                  (iv)  Any adjustments to the Merger Consideration pursuant to
Section 2.2(c) and 2.2(d) hereof shall be made on a pro rata basis in accordance
with each shareholder's respective ownership of E3 Common Stock immediately
prior to the Effective Time.

            (c)   Stock Merger Consideration Adjustment. The Stock Merger
Consideration shall be subject to adjustment as follows:

                  (i)   If the Closing Stock Price is less than 75% of the
Initial Stock Price, then the Stock Merger Consideration shall be determined by
dividing $30,000,000 by 75% of the Initial Stock Price.

                  (ii)  If the Closing Stock Price is greater than 125% of the
Initial Stock Price, then the Stock Merger Consideration shall be determined by
dividing $30,000,000 by 125% of the Initial Stock Price.

            (d)   Cash Merger Consideration Adjustment.

                  (i)   As soon as practicable but in no event later than the
Closing Date, E3 shall provide JDA with the July Balance Sheet. If the
shareholders equity listed on the July Balance Sheet has been reduced or
increased in an amount greater than $100,000 (other than reductions or increases
directly related to any change in the deferred revenue account resulting from
changes in E3's revenue recognition policy) from that listed on the March
Balance Sheet, the Cash Merger Consideration shall be reduced or increased on a
dollar-for-dollar basis for the amount of any reduction or increase,
respectively, in shareholder equity in excess of $100,000, as the case may be.

                  (ii)  Within ten (10) days following the Closing Date, E3
shall provide JDA with the Closing Balance Sheet. If the shareholders equity
listed on the Closing Balance Sheet has been reduced in an amount greater than
$500,000 from that listed in the July Balance Sheet, the Cash Merger
Consideration shall be reduced on a dollar-for-dollar basis for the amount of
any reduction in excess of $500,000. Anything contained in this Agreement to the
contrary notwithstanding, the parties agree that [ONE MILLION DOLLARS
($1,000,000)] shall be withheld from the Cash Merger Consideration otherwise
payable at the Closing and deposited with Gray Cary Ware and Friedenrich LLP
(the "Suspended Funds"), which shall hold the


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Suspended Funds in accordance with this Section 2.2(d)(ii). Within one (1) day
following delivery of the Closing Balance Sheet, JDA and E3 shall notify Gray
Cary Ware and Friedenrich LLP of their calculation of the adjustment, if any, to
be made to the Cash Merger Consideration pursuant to this Section 2.2(d)(ii). If
such calculations agree, then the Suspended Funds shall be distributed promptly
to the parties entitled thereto pursuant to the terms of this Agreement. If the
calculations delivered by JDA and E3 do not agree, then the parties shall use
their good faith efforts to agree on such calculations during the immediately
following two (2) day period. If the parties do not reach agreement upon the
calculations during such two (2) day period, then Gray Cary Ware and Friedenrich
LLP shall distribute the Suspended Funds at the end of such two (2) day period
in accordance with the calculations delivered by E3. Any interest earned on the
Suspended Funds shall be applied on a pro rata basis. The Suspended Funds shall
be deemed Cash Merger Consideration only to the extent that such Suspended Funds
are distributed to the Shareholders in accordance with this Section 2.2(d)(ii).

            (e)   Adjustment to Exchange Ratio. The Exchange Ratio (including
any appropriate adjustments to the Initial Stock Price, Closing Stock Price or
Stock Merger Consideration) shall be adjusted to reflect fully the effect of any
stock split, reverse split, stock dividend (including any dividend or
distribution of securities convertible into JDA Common Stock or E3 Common
Stock), reorganization, recapitalization or other like change with respect to
JDA Common Stock or E3 Common Stock occurring after the date hereof and prior to
the Effective Time, as applicable.

            (f)   Payment of Indebtedness. At Closing, JDA shall deliver a wire
transfer to First Union National Bank in the amount of the Bank Debt (plus any
additional interest amounts at the daily rate) in full and final satisfaction of
the amount owed by E3 to First Union National Bank.

      Section 2.3 Surrender of Certificates. The procedures for surrendering
outstanding shares of E3 Common Stock and receiving the Merger Consideration are
as follows:

            (a)   Delivery of E3 Share Certificates. At Closing, each Signing
Shareholder who surrenders to JDA certificate(s) representing the number of
shares of E3 Common Stock shown as owned by that Signing Shareholder in the E3
Disclosure Schedule, which constitutes all shares of E3 Common Stock held by
that Signing Shareholder and includes all necessary transfer tax and other
reserve stamps, acquired at that Signing Shareholder's expense, affixed and
canceled, shall be entitled to receive that Shareholder's portion of the Merger
Consideration. Each Shareholder who is not a Signing Shareholder shall deliver
to JDA at Closing or promptly following the Closing, a Shareholder's Certificate
in the form attached hereto as Exhibit E and surrender to JDA certificate(s)
representing the number of shares of E3 Common Stock shown as owned by that
Shareholder in the E3 Disclosure Schedule, which shall constitute all shares of
E3 Common Stock held by that Shareholder and will include all necessary transfer
tax and other reserve stamps, acquired at that Shareholder's expense, affixed
and canceled. Each Shareholder shall cure any deficiencies in the endorsement of
the certificates or other documents of conveyance respecting the certificates
representing E3 Common Stock surrendered by that Shareholder. The certificates
so surrendered at Closing shall be canceled immediately after the Effective Time
and the certificates surrendered following the Closing shall be canceled


                                       12
   17
immediately after such surrender. Additionally, E3 shall deliver at Closing all
share certificate or other documentation or instruments that evidence E3's
ownership of the E3 Subsidiaries.

            (b)   Delivery of Closing Merger Consideration. At Closing, upon
surrender by each Shareholder of his stock certificate(s) and other required
documents to JDA as described in Section 2.3(a), that Shareholder shall receive
in exchange therefor (i) subject to Section 2.3(c), a stock certificate issued
in the name of that Shareholder representing that number of shares of JDA Common
Stock shown on Schedule 2.2(b) as being deliverable to that Shareholder at
Closing and (ii) either (A) a check made out to that Shareholder or (B) a wire
sent to an account designated by that Shareholder, in each case, in the amount
shown on Schedule 2.2(b) as being deliverable to that Shareholder at closing.

            (c)   No Fractional Shares. No certificate or scrip representing
fractional shares of JDA Common Stock shall be issued upon the surrender for
exchange of certificates pursuant to Section 2.3(a), and such fractional share
interests will not entitle the owner thereof to vote or to any rights of a
stockholder of JDA. Notwithstanding any other provision of this Agreement, each
holder of shares of E3 Common Stock exchanged pursuant to the Merger who would
otherwise have been entitled to receive a fraction of a share of JDA Common
Stock (after taking into account all certificates for E3 Common Stock delivered
by such holder) shall receive, in lieu thereof, cash (without interest) in an
amount equal to such fractional part of a share of JDA Common Stock multiplied
by the Closing Stock Price.

            (d)   Distributions With Respect to Unexchanged Shares. No dividends
or other distributions with respect to JDA Common Stock with a record date after
the Effective Time will be paid to the holder of any unsurrendered stock
certificate for shares of E3 Common Stock represented thereby until the holder
of record of such certificate shall surrender such certificate. Subject to
applicable law, following surrender of any such certificate, there shall be paid
to the record holder of the certificates representing the whole shares of JDA
Common Stock issued in exchange therefor, without interest at the time of the
surrender, the amount of any such dividends or other distributions with a record
date after the Effective Time theretofore payable (but for the provisions of
this Section 2.3(d)) with respect to such shares of JDA Common Stock.

      Section 2.4 Ancillary Agreements. In connection with the transaction
contemplated by this Agreement, at or before the Closing Date, JDA (or the Sub
or such Subsidiary or affiliate of JDA as JDA may direct) and E3 and/or the E3
Subsidiaries, as applicable, shall enter into and deliver separate stock
purchase agreements or share transfer forms and such other relevant documents as
may be required under local Law ("STOCK TRANSFER DOCUMENTS") with respect to the
equity interests or other ownership interests of the E3 Subsidiaries being
transferred under this Agreement, with only such modifications as are necessary
in order to maintain substantially the same legal meaning and effect under local
Law as provided in this Agreement.

      Section 2.5 Escrow.

            (a)   At the Closing, JDA will deposit into Escrow the Escrowed
Consideration. The Escrowed Consideration shall be held by The Chase Manhattan
Bank or such other financial institution as JDA and E3 shall mutually determine
in accordance with and subject to the provisions of an Escrow Agreement. The
deposit of the Escrowed Consideration with the


                                       13
   18
Escrow Agent on behalf of the Shareholders pursuant to the terms of the Escrow
Agreement shall constitute full and final satisfaction of JDA's obligation to
deliver that portion of the Merger Consideration equal to the Escrowed
Consideration to the appropriate Shareholders in consideration of such
Shareholders' respective shares of E3 Common Stock pursuant to this Agreement.
As provided in the Escrow Agreement, the Shareholders will have all the rights,
title and interest in the Escrowed Shares and the Escrowed Cash as of the
Closing Date.

            (b)   Subject to the terms of the Escrow Agreement, within ten (10)
days following the first anniversary of the Closing Date, the Escrowed
Consideration less (i) any part of the Escrowed Consideration that has
previously been paid to JDA under the terms of the Escrow Agreement, and (ii) an
amount of the Escrowed Consideration equal to the aggregate amount of all
claims, if any, that have been validly tendered by Indemnitees under the Escrow
Agreement prior to such date and remain outstanding as of such date, shall be
released from the Escrow and delivered to the Shareholders on the basis of their
Pro Rata Portion.

      Section 2.6 Certificate Legends. The shares of JDA Common Stock to be
issued pursuant to this Agreement shall not have been registered and shall be
characterized as "restricted securities" under the Securities Act, and under
such Laws such shares may be resold without registration under the Securities
Act only in certain limited circumstances. Each certificate evidencing shares of
JDA Common Stock to be issued pursuant to this Agreement shall bear the
following legend, with such modification or addition thereto as may be required
under local Law:

      "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
      THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). SUCH SHARES MAY NOT BE
      SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION WITHOUT
      AN EXEMPTION UNDER THE ACT OR AN OPINION OF LEGAL COUNSEL REASONABLY
      ACCEPTABLE TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."

Each stock certificate issued to a Shareholder who is not a U.S. Persons shall
bear the following legend, with such modification or addition thereto as may be
required under local Law:

      "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
      THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD,
      OFFERED FOR SALE, TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED IN THE
      UNITED STATES OR TO U.S. PERSONS, EXCEPT (I) IN CONJUNCTION WITH AN
      EFFECTIVE REGISTRATION STATEMENT COVERING SUCH SHARES, (II) IN COMPLIANCE
      WITH AN EXEMPTION FROM REGISTRATION UNDER THE ACT, (III) IN RELIANCE OF AN
      OPINION OF COUNSEL OR OTHER EVIDENCE, SATISFACTORY TO THE COMPANY AND ITS
      COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED BASED ON AN EXEMPTION FROM
      THE REGISTRATION REQUIREMENTS OF THE ACT, OR (IV) IN ACCORDANCE WITH THE
      PROVISIONS OF REGULATION S."


                                       14
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      Section 2.7 Treatment of E3 Options.

            (a)   Prior to the Effective Time, the E3 Stock Option Plan shall
have be terminated by E3.

            (b)   Prior to the Effective Time, each outstanding E3 Option issued
pursuant to an E3 Employee Plan or otherwise shall have been terminated pursuant
to the provisions of such E3 Employee Plan or such other agreement that governs
such E3 Option, and E3 shall have no liability contingent or otherwise,
therefore.

                                  ARTICLE III

                      REPRESENTATIONS AND WARRANTIES OF E3

      Except as disclosed in E3 Disclosure Schedules provided to JDA on or
before the date of this Agreement, E3 and each of the Signing Shareholders,
jointly and severally, represent and warrant to JDA as follows:

      Section 3.1 Organization, Standing, Power and Subsidiaries. E3 is a
corporation duly organized, validly existing and in good standing under the Laws
of the State of Georgia. Each E3 Subsidiary has been duly organized and is
validly existing legal entity and in good standing or its local equivalent, as
applicable, under the Laws of the jurisdiction of its organization (which is set
forth in the E3 Disclosure Schedule), except where a failure to be such shall
not have a Material Adverse Effect on E3. The E3 Subsidiaries are the only
Subsidiaries of E3. Each Acquired Entity has all requisite corporate power to
own, lease and operate its properties and to carry on its business as currently
being conducted and as currently proposed to be conducted, and is duly qualified
to transact business and is in good standing or its local equivalent, as
applicable, in each jurisdiction in which the nature of its operations requires
such qualification, except where the failure to so qualify has not and will not
have a Material Adverse Effect on E3. E3 has delivered true and correct copies
of the Articles of Incorporation and Bylaws of E3, and the charter documents of
each other Acquired Entity in accordance with relevant local Law, each as
amended to date, to JDA. None of the Acquired Entities is in violation of any of
the provisions of its Articles or Certificates of Incorporation, Bylaws or other
charter documents. No Acquired Entity owns directly or indirectly any equity or
similar interest in, or any interest convertible or exchangeable or exercisable
for any equity or similar interest in, any corporation, partnership, joint
venture or other business association or entity except as set forth in the E3
Disclosure Schedule. E3, or an E3 Subsidiary, owns all of the equity interests
or other ownership interests, as applicable under local Law, of each E3
Subsidiary, which equity interests are described in the E3 Disclosure Schedule,
free and clear of all Liens except as set forth in Schedule 3.1 attached hereto.
E3 has delivered to JDA true and correct copies of the charter documents of each
of the E3 Subsidiaries and any other agreement, arrangement or document (i)
between E3 and any E3 Subsidiary or (ii) otherwise related to E3's direct or
indirect ownership of any E3 Subsidiary.


                                       15
   20
      Section 3.2 E3 Capital Structure.

            (a)   The authorized capital stock of E3 consists of 50,000,000
shares of common stock, par value $0.05 per share. As of the date hereof,
15,135,065 shares of E3 Common Stock are issued and outstanding and held of
record by the Shareholders in the amounts set forth in the E3 Disclosure
Schedule. All such outstanding shares of E3 Common Stock have been duly
authorized, validly issued, are fully paid and nonassessable, are free of any
Liens and have been issued in compliance with all applicable federal and state
securities Laws.

            (b)   All outstanding shares or other equity or ownership interests,
as applicable under local Law, of the E3 Subsidiaries have been duly authorized,
validly issued, are fully paid and nonassessable, or the local Law equivalent,
are free of any Liens and have been issued in compliance with all applicable
securities Laws in the relevant jurisdictions.

            (c)   There are (i) no equity securities of any class of any
Acquired Entity, or any securities exchangeable into or exercisable for such
equity securities, issued, reserved for issuance, or outstanding and (ii) no
outstanding subscriptions, options, warrants, puts, calls, rights, or other
commitments or agreements of any character to which an Acquired Entity is a
party or by which it is bound obligating an Acquired Entity to issue, deliver,
sell, repurchase or redeem, or cause to be issued, delivered, sold, repurchased
or redeemed, any equity securities of an Acquired Entity or obligating an
Acquired Entity to grant, extend, accelerate the vesting of, change the exercise
price of, or otherwise amend or enter into any such option, warrant, call,
right, commitment or agreement. There are no contracts, commitments or
agreements relating to voting, purchase or sale of any Acquired Entity's equity
(i) between or among an Acquired Entity and any of its shareholders, equity
holders or holders of ownership interests, as applicable under local Law, or
(ii) to any Acquired Entity's knowledge, between or among any of that entity's
shareholders, equity holders or holders of ownership interests, as applicable
under local Law.

      Section 3.3 Authority; Required Filings and Consents.

            (a)   E3 has all requisite corporate power and authority to execute
and deliver this Agreement and the Transaction Documents, and to consummate the
transactions contemplated hereby and thereby. The execution and delivery of this
Agreement and the other Transaction Documents to which E3 is or will be a party
and the consummation of the transactions contemplated hereby and thereby have
been duly authorized by all necessary corporate action on the part of E3,
including the approval of the Merger by the Shareholders as required by the Laws
of Georgia. This Agreement has been, and the other Transaction Documents to
which E3 and the Acquired Entities are a party have been or will be when they
are executed by E3 and the Acquired Entities, duly executed and delivered by E3
and the Acquired Entities and constitute, or will constitute when they are
executed by E3 and the Acquired Entities, the valid and binding obligations of
E3 and the Acquired Entities, enforceable against E3 and the Acquired Entities
in accordance with their respective terms, except as such enforceability may be
limited by (i) bankruptcy, insolvency, moratorium or other similar Laws
affecting or relating to creditors' rights generally, and (ii) general
principles of equity.


                                       16
   21
            (b)   The execution and delivery by E3 of this Agreement and the
other Transaction Documents to which it is a party, or will be a party when they
are executed by E3, do not, and the consummation of the transactions
contemplated hereby and thereby will not, (i) conflict with, or result in any
violation or breach of any provision of, the Articles of Incorporation or Bylaws
of E3 or charter documents of the Subsidiaries, (ii) result in any violation or
breach of or constitute (with or without notice or lapse of time, or both) a
default under, or give rise to a right of termination, cancellation or
acceleration of any obligation or loss of any benefit under or the payment of
any fees or fines under, any material agreement (including any material note,
mortgage, indenture, lease, guarantee, contract or other agreement or
obligation) to which E3 or any other Acquired Entity is a party or by which E3
or any other Acquired Equity or any of its respective properties or assets may
be bound, or (iii) conflict with or violate any permit, concession, franchise,
license, judgment or Law applicable to E3 or any other Acquired Entity or any of
its respective properties or assets and where such conflict or violation could
reasonably expected to have a Material Adverse Effect on E3.

            (c)   No Consent from a Governmental Entity is required by or with
respect to E3, the E3 Subsidiaries or its shareholders in connection with the
execution and delivery of this Agreement, the Transaction Documents, the Merger
or the consummation of the transactions contemplated hereby, except for (i) the
filing of a pre-merger notification and report form, by E3 and JDA and, if
required, by some or all of the Shareholders, under the HSR Act, (ii) the filing
of the Certificate of Merger with the Secretary of State of the State of Georgia
in accordance with the GBCC, (iii) such Consents as may be required under
applicable federal and state securities Laws in the United States and the
securities Laws of other relevant jurisdictions, and (iv) such other Consents
which, if not obtained or made, would not have a Material Adverse Effect on E3
or any Acquired Equity and would not prevent or materially alter or delay any of
the transactions contemplated by this Agreement. No Acquired Entity or any
Shareholder has received any notice, written or otherwise, or has any other
knowledge of any plan or intention of any party not to grant any Consent listed
in the E3 Disclosure Schedule.

      Section 3.4 Financial Statements. E3 has delivered to JDA (i) its audited
consolidated financial statements for each of the years ended December 31, 1998,
1999 and 2000, (ii) its unaudited consolidated financial statements, including
statements of operations and cash flows for the quarters ending March 31, 2001
and June 30, 2001, and (iv) its unaudited financial statements, including
statements of operations and cash flows for the current fiscal year through July
31, 2001 and through the date of, and including, the Closing Balance Sheet
(collectively, the "E3 FINANCIAL STATEMENTS"). The E3 Financial Statements were
prepared in accordance with GAAP and accounting policies applied on a consistent
basis throughout the periods involved, except that the unaudited interim E3
Financial Statements do not contain footnotes and that the financial statements
dated as of and for periods ending as of March 31, 2001 and July 31, 2001 do not
reflect changes in E3's revenue recognition policy consistent with GAAP. The E3
Financial Statements present fairly, in all material respects, the financial
position of E3 and the E3 Subsidiaries on a consolidated basis as of the
respective dates and the results of its operations and cash flows for the
periods indicated, subject, in the case of unaudited interim financial
statements, to normal year-end audit adjustments. E3 maintains, and until the
Effective Time will continue to maintain, a standard system of accounting
established and administered in accordance with GAAP.


                                       17
   22
      Section 3.5 Absence of Undisclosed Liabilities. None of the Acquired
Entities have any liabilities of any kind whatsoever, whether accrued,
contingent, absolute, determined, determinable or otherwise (whether or not
required to be reflected in financial statements in accordance with GAAP), and
whether due or to become due, other than (i) liabilities reflected or provided
for on the Closing Balance Sheet contained in the E3 Financial Statements, (ii)
liabilities contemplated by this Agreement and (iii) normal or recurring
liabilities incurred since the Balance Sheet Date in the ordinary course of
business consistent with past practices. Any liabilities of the type described
in clause (iii) of the previous sentence in excess of $500,000, individually or
in the aggregate, are listed and described in the E3 Disclosure Schedule.

      Section 3.6 Absence of Certain Changes or Events. Since the Balance Sheet
Date, each Acquired Entity has conducted its business in the ordinary course and
in a manner consistent with past practices and, since such date, none of the
Acquired Entities has:

            (a)   suffered any event or occurrence (whether singly or in the
aggregate) that has had, or is reasonably likely to have, a Material Adverse
Effect on the Acquired Entities;

            (b)   suffered any damage, destruction or loss, whether covered by
insurance or not, having a Material Adverse Effect on the properties or business
of the Acquired Entities;

            (c)   granted any increase in the compensation payable or to become
payable by any Acquired Entity to its directors, officers, managers or Employees
(except, with respect to the managers and Employees, those increases in
compensation occurring in the ordinary course of business consistent with E3's
past practices);

            (d)   declared, set aside or paid any dividend or made any other
distribution on or in respect of the shares of its capital stock or other equity
interests or declared any direct or indirect redemption, retirement, purchase or
other acquisition of such shares or other equity interests;

            (e)   issued any shares of its capital stock or any other equity
interests or any warrants, rights, or options for, or entered into any
commitment relating to such capital stock or any other equity interests;

            (f)   made any material change in the accounting methods or
practices it follows, whether for general financial or tax purposes, or any
material change in depreciation or amortization policies or rates;

            (g)   sold, leased, subleased, abandoned or otherwise disposed of
any real property, leasehold interests, machinery, equipment or other operating
property other than in the ordinary course of business;

            (h)   sold, assigned, transferred, licensed or otherwise disposed of
any patent, trademark, trade name, brand name, copyright (or pending application
for any patent, trademark or copyright), invention, work of authorship, process,
know-how, formula or trade secret or interest thereunder or other material
intangible asset other than in the ordinary course of business;


                                       18
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            (i)   entered into any material commitment or transaction
(including, without limitation, any borrowing or capital expenditure) other than
in the ordinary course of business;

            (j)   incurred any material liability, except in the ordinary course
of business and consistent with past practice;

            (k)   permitted or allowed any of its property, leasehold interests
or assets to be subjected to any Lien, except for Liens in place as of the
Balance Sheet Date and disclosed to the Buyer pursuant to this Agreement and
Liens for current taxes not yet due and purchase money security interests
incurred in the ordinary course of business;

            (l)   made any capital expenditure or commitment for additions to
property, plant or equipment individually in excess of $50,000, or, in the
aggregate, in excess of $250,000;

            (m)   paid, loaned or advanced any amount to, or sold, transferred
or leased any properties or assets to, or entered into any agreement or
arrangement with, any of its officers, directors or ten percent (10%)
shareholders or any affiliate of any of the foregoing, other than employee
compensation and benefits and reimbursement of employment related business
expenses incurred in the ordinary course of business;

            (n)   agreed to take any action described in this Section 3.6 or
which would constitute a breach of any of the representations or warranties of
E3 contained in this Agreement; or

            (o)   taken any other action that would have required the consent of
JDA pursuant to Section 5.1 of this Agreement (and which has not been obtained)
had such action occurred after the date of this Agreement to the extent not
otherwise listed herein.

      Section 3.7 Taxes.

            (a)   Each Acquired Entity has prepared and timely filed all Returns
relating to any and all Taxes concerning or attributable to that Acquired Entity
or its operations, such Returns are true and correct in all material respects
and have been completed in accordance with applicable Law, and each Acquired
Entity has disclosed on its Returns all positions taken therein that could
reasonably be expected to give rise to a substantial understatement penalty
within the meaning of Section 6662 of the Code (or any predecessor provision or
comparable provision of state, local or foreign Law).

            (b)   Each Acquired Entity, as of the Closing Date, (i) will have
paid or accrued for on the E3 Financial Statements all Taxes it is required to
pay prior to the Closing Date and (ii) will have withheld with respect to its
Employees all Taxes required to be withheld.

            (c)   During the period of all unexpired applicable statute of
limitations, no Acquired Entity has been delinquent in the payment of any Tax.
There is no Tax deficiency outstanding or assessed or, to E3's knowledge,
proposed against any Acquired Entity that is not reflected as a liability on the
July Balance Sheet or set forth on the E3 Disclosure Schedule, nor has any
Acquired Entity executed any agreements or waivers extending any statute of
limitations on or extending the period for the assessment or collection of any
Tax.


                                       19
   24
            (d)   The Acquired Entities' liability for unpaid Taxes (whether
actual or contingent) as of the Closing Date does not exceed the reserve for
unpaid Taxes on the Closing Balance Sheet.

            (e)   No Acquired Entity is a party to any tax-sharing agreement or
similar arrangement with any other party, and no Acquired Entity has assumed or
agreed to pay any Tax obligations of, or with respect to any transaction
relating to, any other person or agreed to indemnify any other person with
respect to any Tax.

            (f)   No Acquired Entity's Returns have ever been audited by a
government or taxing authority, no such audit is in process or pending, and no
Acquired Entity has been notified of any request for such an audit or other
examination.

            (g)   No Acquired Entity has ever been a member of an affiliated
group of corporations filing a consolidated federal income tax return other than
a group the common parent of which was E3.

            (h)   Each Acquired Entity has made available to JDA copies of all
Returns filed for all periods for the past three (3) tax years.

            (i)   No Acquired Entity has ever filed any consent agreement under
Section 341(f) of the Code or agreed to have Section 341(f)(4) apply to any
disposition of assets owned by that Acquired Entity.

            (j)   No Acquired Entity is a party to any contract, agreement, plan
or arrangement, including but not limited to the provisions of this Agreement,
covering any Employee or former Employee of that Acquired Entity which,
individually or collectively, could reasonably be expected to give rise to the
payment of any amount that would not be deductible as an expense by the Acquired
Entity pursuant to Sections 280G, 404 or 162(m) of the Code or by similar
applicable Law.

            (k)   E3 has not constituted either a "distributing corporation" or
a "controlled corporation" in a distribution of stock qualifying for tax-free
treatment under Section 355 of the Code (i) in the two years prior to the date
of this Agreement or (ii) in a distribution which could otherwise constitute
part of a "plan" or "series of related transactions" (within the meaning of
Section 355(e) of the Code) in conjunction with the Merger.

            (l)   E3 has not agreed to make, nor is it required to make, any
adjustment under Section 481 of the Code by reason of any change in accounting
method.

            (m)   None of the assets of any Acquired Entity is treated as
"tax-exempt use property," within the meaning of Section 168(h) of the Code.

            (n)   No Acquired Entity is, or has been, a "reporting corporation"
subject to the information reporting and record maintenance requirements of
Section 6038A of the Code and the regulations thereunder.


                                       20
   25
            (o)   No Acquired Entity has ever been a party to any joint venture,
partnership or other agreement that could reasonably be expected to be treated
as a partnership for Tax purposes.

            (p)   There are (and immediately following the Effective Time there
will be) no Liens on the assets of any Acquired Entity relating to or
attributable to Taxes, other than Liens for Taxes not yet due and payable.

            (q)   Each Acquired Entity is properly registered for purposes of
value added tax and all other taxes in each jurisdiction in which such
registration is required and no Acquired Entity has received any notice from any
taxing authority in a jurisdiction where it has not filed Returns that such
Acquired Entity may be subject to taxation in that jurisdiction.

            (r)   No Acquired Entity has requested or received any private
letter ruling from the Internal Revenue Service or comparable rulings from any
other government or taxing agency.

            (s)   No power of attorney with respect to Taxes has been granted
with respect to the Acquired Entities.

      Section 3.8 Tangible Assets and Real Property.

            (a)   Each Acquired Entity owns or leases all the Material Tangible
Assets. The Material Tangible Assets are in such condition and repair,
reasonable wear and tear excepted, as is suitable for the purposes for which
they are currently used by E3. Each Acquired Entity has good and marketable
title to all Material Tangible Assets that it owns (except properties, interests
in properties and assets sold or otherwise disposed of since the July Balance
Sheet Date in the ordinary course of business), free and clear of all Liens,
except for Liens for current Taxes not yet due and payable. Assuming the due
execution and delivery thereof by the other parties thereto, all leases of
Material Tangible Assets to which an Acquired Entity is a party are in full
force and effect and valid, binding and enforceable against the Acquired
Entities and, to E3's knowledge, the other party thereto in accordance with
their respective terms, except as such enforceability may be limited by (i)
bankruptcy, insolvency, moratorium or other similar Laws affecting or relating
to creditors' rights generally, and (ii) general principles of equity. The E3
Disclosure Schedule sets forth a true and correct list of all such leases, and
true and correct copies of all such leases have been made available to JDA,
except for equipment leases which do not have annual payments of $10,000
individually or $25,000 in the aggregate.

            (b)   No Acquired Entity owns any real property.

            (c)   The E3 Disclosure Schedule sets forth a true and complete list
of all real property leased, subleased or licensed by an Acquired Entity and all
real property subleases to which an Acquired Entity is a party. Assuming the due
execution and delivery thereof by the other parties thereto, all such real
property leases, subleases and licenses are in full force and effect and valid,
binding and enforceable, to E3's knowledge after reasonable investigation of
local Law, against the other parties in accordance with their respective terms,
except as such enforceability may be limited by (i) bankruptcy, insolvency,
moratorium or other similar Laws


                                       21
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affecting or relating to creditors' rights generally, and (ii) general
principles of equity. True and correct copies all such of real property leases
and subleases have been made available to JDA.

      Section 3.9 Intellectual Property.

            (a)   Each Acquired Entity owns, is licensed under or otherwise
possesses adequate and legally enforceable rights to use and practice, without
future payment or attribution to or consent of any person, all patents,
trademarks, trade names, service marks, copyrights (including, without
limitation, moral rights), mask works, domain names and Derivative Works, and
any applications for and registrations of such patents, trademarks, trade names,
service marks, copyrights, mask works and Derivative Works and all processes,
formulas, methods, schematics, technology, know-how, computer software programs
or applications, databases, trade secrets and tangible or intangible proprietary
information or material that are necessary to conduct the business of that
Acquired Entity as currently being conducted (all of which are referred to as
the "E3 INTELLECTUAL PROPERTY RIGHTS"), free and clear of all Liens. The
foregoing representation as it relates to Licensed Intellectual Property is
limited to an Acquired Entity's interest pursuant to licenses from third
parties, each of which is in full force and effect, is valid, binding and
enforceable and grants an Acquired Entity such rights to such intellectual
property as are necessary to the business of that Acquired Entity as currently
conducted.

            (b)   The E3 Disclosure Schedule contains an accurate and complete
list and description of (i) all issued patents, registered trademarks, trade
names, registered service marks and registered copyrights therefor included in
the E3 Intellectual Property Rights, including the jurisdictions in which each
such E3 Intellectual Property Right has been issued or registered or in which
any such application for such issuance or registration has been filed, (ii) all
pending patent, copyright and trademark applications, (iii) other than those
non-exclusive licenses granted to customers in the ordinary course of business,
all licenses, sublicenses, development agreements, manufacturing agreements,
distribution agreements, agency agreements, commission agreements, options,
rights (including marketing rights), and other agreements to which any Acquired
Entity is a party and pursuant to which any person is authorized to use any E3
Intellectual Property Rights or has the right to develop, manufacture,
reproduce, market, solicit orders for or exploit any current product that is
available for license of any Acquired Entity (a "E3 PRODUCT") or any adaptation,
translation or Derivative Work based on any E3 Product or any portion thereof,
(iv) all licenses, sublicenses and other agreements to which any Acquired Entity
is a party and pursuant to which any Acquired Entity is authorized to use any
third party technology, trade secret, know-how, process, patent, trademark or
copyright, including software and databases ("LICENSED INTELLECTUAL PROPERTY"),
which is used in the development, manufacture or marketing of, or is
incorporated in or forms a part of any E3 Product (other than licenses for
standard off-the-shelf software used in the conduct of any Acquired Entity's
business), (v) all joint development agreements to which any Acquired Entity is
a party, (vi) all agreements with Governmental Entities, universities, research
institutions or other third parties pursuant to which any Acquired Entity has
obtained government funding for research and development activities, (vii) a
list of all E3 Products, software, code, programmers' notes or other E3
Intellectual Property held in escrow, including the location and status of such
escrow and (viii) a table of the E3 Products, the platforms for which they were
developed and the development status of such E3 Product.


                                       22
   27
            (c)   The execution and delivery of this Agreement, compliance with
its terms and the consummation of the transactions contemplated hereby in
accordance with this Agreement do not and will not conflict with, or result in
any violation or breach of, or default (with or without notice or lapse of time
or both) or give rise to any right, license or Lien relating to any E3
Intellectual Property Rights, any of the agreements of Section 3.9(b), or any
right of termination, cancellation or acceleration of any E3 Intellectual
Property Rights or any such agreements or any such obligation thereof, or the
loss or encumbrance of any E3 Intellectual Property Rights or benefit related
thereto, or result in or require the creation, imposition or extension of any
Lien upon any E3 Intellectual Property Rights, or cause the acceleration of any
payment due to any third party, or cause any third party to be entitled to any
statutory payments, or otherwise impair the right of any Acquired Entity or its
customers to use the E3 Intellectual Property Rights in the same manner as such
E3 Intellectual Property Rights are currently being used by E3 or the customers
of any Acquired Entity.

            (d)   All copyrights and, to the knowledge of E3, all patents and
registered trademarks, service marks and domain names owned by or issued to any
Acquired Entity which relate to any E3 Product are valid and subsisting and no
Acquired Entity has received any notice challenging or questioning the validity
or effectiveness of any of the foregoing. The manufacturing, marketing,
licensing or sale of any E3 Product does not infringe any copyright, proprietary
or personal right or, to the knowledge of E3, any patent, trade secret,
trademark, trade name, service mark or mask work right of any third party. No
Acquired Entity (i) has been sued or named in any suit, action or proceeding
which involves a claim of infringement or misappropriation of any patent,
trademark, trade name, service mark, copyright, mask work right, trade secret,
domain name or other proprietary right of any third party, (ii) has received a
notice of any such infringement or misappropriation or (iii) has knowledge of
any claim challenging or questioning the validity or effectiveness of any
license or agreement relating to any E3 Intellectual Property Rights or to any
Licensed Intellectual Property. There is no outstanding order, writ, injunction,
decree, judgment or stipulation by or with any court, administrative agency or
arbitration panel regarding patent, copyright, trade secret, trademark, trade
name, mask work right or other claims relating to the E3 Intellectual Property
Rights to which any Acquired Entity is a party or by which any Acquired Entity
is bound.

            (e)   All designs, drawings, specifications, source code, object
code, documentation, flow charts and diagrams incorporated, embodied or
reflected in any E3 Product at any stage of its development were written,
developed and created solely and exclusively by (i) Employees of an Acquired
Entity (without the assistance of any third party) who have validly waived or
otherwise conveyed the benefit of any moral rights thereto to the Acquired
Entity or (ii) third parties who assigned ownership of their rights with respect
thereto to an Acquired Entity by means of valid and enforceable agreements,
which are listed and described in the E3 Disclosure Schedule and copies of which
have been made available to JDA. None of the trade secrets of any Acquired
Entity have been published or disclosed by any Acquired Entity or, to the
knowledge of any Acquired Entity, by any other person, to any person in a manner
that would materially jeopardize such information's status as a trade secret,
except pursuant to licenses or contracts requiring such other persons to keep
such trade secrets confidential.

            (f)   No Acquired Entity is in breach of or in default (including
with the passage of time or the giving of notice or both) under any material
obligation of any license,


                                       23
   28
sublicense, development agreement, manufacturing agreement, distributorship or
other similar arrangements relating to the E3 Intellectual Property Rights and,
to the knowledge of the E3, no other party to any such arrangements is in breach
or default thereof.

            (g)   To the knowledge of E3, no person is infringing on or
otherwise violating any right of any Acquired Entity with respect to any E3
Intellectual Property Rights.

            (h)   No Acquired Entity has assigned, sold or otherwise transferred
ownership of, or granted an exclusive license or exclusive right to use, any
patent, patent application, trademark, mask work right, service mark or domain
name.

            (i)   No Acquired Entity or any of its directors, officers, managers
or Employees has any patents issued or patent applications pending for any
invention of any kind now used or needed by any Acquired Entity in the
furtherance of its business operations as currently being conducted by that
Acquired Entity, which patents or applications have not been assigned to an
Acquired Entity with such assignment duly recorded in the United States Patent
Office or with the applicable foreign Governmental Entity.

            (j)   Each person currently or formerly employed by any Acquired
Entity (including Consultants and independent contractors, if any) that has or
had access to confidential information of any Acquired Entity has executed and
delivered to an Acquired Entity a confidentiality and non-disclosure agreement
in one of the forms previously provided to JDA. No director, corporate officer
(with the title of president or vice president, including the President-Europe),
senior legal counsel or senior regional manager of E3 has received notice that
the execution or delivery of any such agreement by any such person, or the
carrying on by any such person, as an Employee, Consultant or independent
contractor, of any Acquired Entity's business as currently conducted and as
currently proposed to be conducted, has or will conflict with or result in a
breach of the terms, conditions or provisions of, or constitute a default under,
any contract, covenant or instrument under which any of such persons is
obligated. Schedule 3.9(j) contains a list of all current or former Employees
and Consultants who have participated in the development of any E3 Product or E3
Intellectual Property.

            (k)   To E3's knowledge, the E3 Products disclosed on the E3
Disclosure Schedule contain no errors which (i) are unresponsive to remedial
actions taken after proper notification and in accordance with the terms of the
E3 Product license agreement, during the ordinary course of business and (ii)
prevents the E3 Products from operating in any material capacity for an extended
period of time.

      Section 3.10 Bank Accounts. The E3 Disclosure Schedule sets forth the
names and locations of all banks and other financial institutions at which any
Acquired Entity maintains accounts of any nature, the type of accounts
maintained at each such institution and the names of all persons authorized to
draw thereon or make withdrawals therefrom.

      Section 3.11 Contracts.

            (a)   No Acquired Entity is a party or subject to any agreement,
obligation or commitment, written or oral:


                                       24
   29
                  (i)   that calls for any fixed or contingent payment or
expenditure or any related series of fixed or contingent payments or
expenditures by or to an Acquired Entity totaling more than $100,000 in the
twelve-month period prior to or following the Balance Sheet Date;

                  (ii)  with agents, advisors, managers, salesmen, sales
representatives, independent contractors or Consultants that are not cancelable
by it without liability, penalty or premium on no more than thirty (30) days'
notice;

                  (iii) that explicitly restricts any Acquired Entity from
carrying on anywhere in the world its business or any portion thereof as
currently conducted or from carrying on business of any other sort anywhere in
the world;

                  (iv)  to provide funds to or to make any investment in any
other person or entity other than an Acquired Entity (in the form of a loan,
capital contribution or otherwise);

                  (v)   with respect to E3's obligations as guarantor, surety,
co-signer, endorser, co-maker, indemnitor or otherwise in respect of the
obligation of any other person or entity other than an Acquired Entity;

                  (vi)  for any line of credit, standby financing, revolving
credit or other similar financing arrangement;

                  (vii) with any distributor, original equipment manufacturer,
value added remarketer or other person for the distribution of any products of
any Acquired Entity;

                  (viii) with any customers that grant such customers a refund
right (other than as a remedy for a breach of warranty) on the installation of
E3 Products or software, and that the refund period with respect any such
installations has not passed, lapsed, expired or terminated;

                  (ix)  with any customers that provide the customer with an
option to buy monthly user fee in one lump sum rather than pay out their monthly
user fee in perpetuity (a list and detail of those customers with such
agreements and a list of those customers who have exercised the lump-sum option
is set forth on such schedule);

                  (x)   with any customers who since January 1, 2001 have
elected to pay monthly use fees on an annual basis in exchange for a discount
from such fees (a list of any such agreements and any discount amounts for each
customer are set forth on such schedule);

                  (xi)  with any customers for services that were on a fixed bid
basis in excess of $25,000 and have not been completed (a list and description
of any incomplete or outstanding arrangements is set forth on such schedule);

                  (xii) with any customers whose agreement with an Acquired
Entity contains a "most favored" customer clause;


                                       25
   30
                  (xiii) with any Governmental Entity or involving the provision
of products or services to a Governmental Entity; or

                  (xiv) that is otherwise material to the business of any
Acquired Entity as currently being conducted, or as currently proposed to be
conducted and that is not otherwise listed in Section 3.11(a) of the E3
Disclosure Schedule.

            (b)   To the knowledge of any Acquired Entity, no party to any such
contract, agreement or instrument has threatened or given prior written notice
of its intention to cancel or withdraw such contract, agreement or instrument.
Any such existing contract, agreement or instrument is legal, valid, binding and
enforceable and in full force and effect with respect to such Acquired Entity,
and to such Acquired Entity's knowledge is legal, valid, binding, enforceable
and in full force and effect with respect to each other party thereto, in either
case subject to the effect of bankruptcy, insolvency, moratorium or other
similar Laws affecting the enforcement of creditors' rights generally and except
as the availability of equitable remedies may be limited by general principles
of equity and the exercise of judicial discretion in accordance with such
principles. Such contracts, agreements or instruments shall continue to be
legal, valid, binding and enforceable and in full force and effect immediately
following the Closing with respect to each Acquired Entity, and to such Acquired
Entity's knowledge is legal, valid, binding, enforceable and in full force and
effect with respect to each other party thereto, in either case, in accordance
with the terms thereof as in effect prior to the Closing, subject to the effect
of bankruptcy, insolvency, moratorium or other similar Laws affecting the
enforcement of creditors' rights generally and except as the availability of
equitable remedies may be limited by general principles of equity.

            (c)   No Acquired Entity is in material default under or in material
breach or violation of, nor is there any valid basis for any claim of material
default by any Acquired Entity under, or material breach or violation by any
Acquired Entity of, any contract, commitment or restriction to which any
Acquired Entity is a party or by which any Acquired Entity or any of its
properties or assets is bound or affected. To the knowledge of any Acquired
Entity, no other party is in material default under or in material breach or
violation of, nor is there any valid basis for any claim of material default by
any other party under, or any material breach of violation by any other party
of, any contract, commitment, or restriction to which any Acquired Entity is a
party or by which any Acquired Entity or any of its properties or assets is
bound or affected.

      Section 3.12 Labor Difficulties.

            (a)   Except as set forth on the E3 Disclosure Schedule, there is no
controversy existing, pending or, to the knowledge of E3, threatened with any
association, labor union, works council, trade union, collective bargaining
representative or other employee representative of the Employees.

            (b)   Except as set forth on the E3 Disclosure Schedule, there is no
charge or complaint relating to unfair labor practice pending against any
Acquired Entity, or to the knowledge of E3, or threatened before any
Governmental Entity, nor is there any strike, slowdown, work stoppage, grievance
or other labor dispute pending or, to the knowledge of any Acquired Entity (nor,
to the knowledge of any Acquired Entity or the Shareholders, does any


                                       26
   31
valid basis for any such complaint exist), threatened against any Acquired
Entity. To the knowledge of E3, no Acquired Entity is now or has ever been
subject to any union organizing activities, nor has any Acquired Entity
experienced any work stoppage or other labor difficulty within the last three
(3) years.

            (c)   The E3 Disclosure Schedule sets forth a true and complete list
of each works council, labor union, trade union, labor organization or other
employee representative which has to be notified or consulted or with which
negotiations need to be conducted in connection with the transactions
contemplated by this Agreement, and each collective bargaining agreement which
has any impact on the terms and conditions of employment with respect to the
Employees.

            (d)   Where required by Law, E3 and any Acquired Entity will prior
to the Closing Date properly and timely notify, or where appropriate, consult or
negotiate with, the works council, labor union, trade union, labor organization,
employee representative, labor board or governmental agency concerning the
transactions contemplated by this Agreement.

      Section 3.13 Trade Regulation. Since the Balance Sheet Date, no Acquired
Entity has terminated its relationship with or refused to ship any of its
products to any dealer, distributor, third party marketing entity or customer
which had theretofore paid or been obligated to pay any Acquired Entity in
excess of $100,000 over the immediately prior twelve (12) month period. All of
the prices charged by any Acquired Entity in connection with the marketing or
sale of any of its products or services have been in compliance with all
applicable Laws and regulations except where such non-compliance would not have
a Material Adverse Effect on E3. No claims have been asserted or, to the
knowledge of the Acquired Entity, threatened against E3 with respect to the
wrongful termination of any dealer, distributor or any other marketing entity,
discriminatory pricing, price fixing, unfair competition, false advertising, or
any other violation of any Laws or regulations relating to anti-competitive
practices or unfair trade practices of any kind.

      Section 3.14 Environmental Matters.

            (a)   There are no Environmental Claims pending or, to the knowledge
of any Acquired Entity, threatened (i) against any Acquired Entity or (ii)
against any real or personal property or operations which any Acquired Entity
owns, leases, occupies, possesses or manages, in whole or in part.

            (b)   To the knowledge of E3, there have been no Releases of any
Hazardous Material that are reasonably likely to form the basis of any
Environmental Claim against any Acquired Entity.

            (c)   At all times, each Acquired Entity has transported, stored,
used, manufactured, treated, generated, handled, disposed of or arranged for the
disposition of, released or exposed its Employees or others to Hazardous
Materials in compliance with all Environmental Laws promulgated by any
Governmental Entity except where such non-compliance would not have a Material
Adverse Effect on E3.

            (d)   Each Acquired Entity currently holds all Environmental Permits
necessary for the conduct of its business as such business is currently being
conducted and is in compliance


                                       27
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with all such Environmental Permits except where such non-compliance would not
have a Material Adverse Effect on E3. Except as set forth in the E3 Disclosure
Schedule, no environmental report, closure activity, investigation or
assessment, and no notification to or Consent from, any Governmental Entity with
jurisdiction regarding environmental matters or Hazardous Materials is required
to be obtained by any Acquired Entity, either before or after the Effective
Time, in connection with any of the transactions contemplated by this Agreement.

            (e)   No Acquired Entity has any knowledge of any Environmental
Claim pending or threatened, or of any Release of Hazardous Materials that is
reasonably likely to form the basis of any Environmental Claim, in each case
against any person or entity (including, without limitation, any predecessor of
any Acquired Entity) whose liability any Acquired Entity has or may have
retained or assumed either contractually or by operation of Law or against any
real or personal property which any Acquired Entity formerly owned, leased or
managed, in whole or in part.

            (f)   E3 has made available JDA with copies (or, if not available,
accurate written summaries) of all environmental investigations, studies,
audits, reviews and other analyses conducted by or on behalf, or which otherwise
are in the possession, of any Acquired Entity or any Shareholder respecting any
facility, site or other property any Acquired Entity currently owns or operates.

            (g)   No underground storage tanks or underground improvements,
including without limitation, treatment or storage tanks, sumps, or water, gas
or oil wells are or were present under any property that any Acquired Entity has
at any time owned, operated, occupied or leased.

            (h)   To the knowledge of E3, no asbestos or asbestos-containing
material, formaldehyde or insulating material containing urea formaldehyde, or
material containing polychlorinated biphenyls is present in, on, or at any real
property or facility or equipment that any Acquired Entity currently owns,
operates, occupies or leases.

      Section 3.15 Employee Benefit Plans.

            (a)   With respect to each E3 Employee Plan (as hereinafter
defined):

                  (i)   E3 has set forth in the E3 Disclosure Schedule a
complete and accurate list of all material agreements, funds, plans, programs,
policies, practices, contracts or other arrangements providing for employment,
compensation, retirement, pension, superannuation, profit sharing, deferred
compensation, hospitalization, medical, dental, vision, vacation, life
insurance, death benefit, sick pay, disability, loans, severance, separation,
relocation, repatriation, expatriation, visas, work permits, termination pay,
termination indemnity, redundancy pay, performance awards, commissions, bonus,
thirteenth month, incentive, stock option, stock purchase, stock bonus, phantom
or stock equivalent, stock appreciation right, supplemental retirement, fringe
benefits, cafeteria benefits, educational assistance, holiday pay, housing
assistance, moving expense reimbursement or other benefits, whether written or
unwritten, including, without limitation, each "employee benefit plan" within
the meaning of Section 3(3) of ERISA which is or has been sponsored, maintained,
contributed


                                       28
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to, or required to be contributed to by E3, any E3 Subsidiary or any ERISA
Affiliate for the benefit of any person who performs or who has performed
services for E3 or with respect to which E3, any E3 Subsidiary or ERISA
Affiliate has or may have any liability (including, without limitation,
contingent liability) or obligation, regardless of whether it is voluntary,
private, funded, unfunded, financed by the purchase of insurance, contributory
or non-contributory (each an "E3 EMPLOYEE PLAN" and collectively, "E3 EMPLOYEE
PLANS"); provided, however, that any governmental plan or program requiring
mandatory payment of social insurance taxes or similar contributions to a
governmental fund with respect to the wages of an Employee and any plan or
program that may be mandated by local Law shall not be considered an "E3
Employee Plan" for these purposes. An E3 Employee Plan adopted or maintained,
whether formally or informally, for the benefit of Employees in the United
States is hereinafter referred to as a "E3 U.S. EMPLOYEE PLAN." An E3 Employee
Plan adopted or maintained, whether formally or informally, for the benefit of
Employees outside the United States is hereinafter referred to as a "E3
INTERNATIONAL EMPLOYEE PLAN." There has been no amendment to, written
interpretation or announcement by E3, any E3 Subsidiary or ERISA Affiliate which
would materially increase the expense of maintaining any E3 Employee Plan above
the level of expense incurred with respect to that plan for the most recent
fiscal year included in the plan sponsor's financial statements.

                  (ii)  Each E3 Employee Plan and any plan or program that may
be mandated under local Law has been established and administered in accordance
with its terms and in material compliance with the requirements prescribed by
any and all statutes, rules and regulations.

                  (iii) As of the Closing Date, no E3 Employee Plan and any plan
or program that may be mandated under local Law has any unfunded liability. As
of the Closing Date, the Benefit Obligations under each E3 Employee Plan will be
(A) appropriately reflected on the Closing Balance Sheet in accordance with GAAP
and (B) appropriately reflected on the E3 Financial Statements (or the financial
statements of any other E3 Employee Plan sponsor) in accordance with local Law,
past practice and generally accepted accounting principles in each applicable
jurisdiction. Any E3 Employee Plan that is sponsored by any Acquired Entity as
of the Closing Date will own assets (including cash or insurance contracts) with
a fair market value, as of the Closing Date, equal to or greater than the
Benefit Obligations under such plan as of the Closing Date.

            (b)   No Acquired Entity is a party to any oral or written (i)
agreement with any officer or other key Employee of any Acquired Entity, the
benefits of which are contingent, or the terms of which are materially altered,
upon the occurrence of a transaction involving any Acquired Entity of the nature
contemplated by this Agreement, (ii) agreement with any officer of any Acquired
Entity providing any term of employment or compensation guarantee or for the
payment of compensation in excess of $100,000 per annum, or (iii) agreement or
plan, including any stock option plan, stock appreciation right plan, restricted
stock plan or stock purchase plan, any of the benefits of which will be
increased, or the vesting of the benefits of which will be accelerated, by the
occurrence of any of the transactions contemplated by this Agreement or the
value of any of the benefits of which will be calculated on the basis of any of
the transactions contemplated by this Agreement.


                                       29
   34
            (c)   With respect to each E3 U.S. Employee Plan:

                  (i)   E3 has furnished to JDA true and complete copies of
documents embodying each E3 U.S. Employee Plan and related plan documents,
including (to the extent applicable) the most recent determination or opinion
letter, trust documents, group annuity contracts, plan amendments, insurance
policies or contracts, participant agreements, employee booklets, administrative
service agreements, summary plan descriptions, summary of material
modifications, compliance and nondiscrimination tests for the last three plan
years, Form 5500 reports filed for the last three plan years, standard COBRA
forms and related notices, and registration statements and prospectuses.

                  (ii)  (1) E3 has, to the extent applicable, either obtained
from the Internal Revenue Service a favorable determination or opinion letter as
to its qualified status under the Code, including Section 4975(e)(7) of the
Code, if applicable, and all amendments to the Code which are currently
effective, or has time remaining to apply under applicable regulations or
pronouncements for a determination or opinion letter and to make any amendments
necessary to obtain a favorable determination or opinion letter; (2) none of the
E3 U.S. Employee Plans promises or provides retiree medical or other retiree
welfare benefits to any person (other than COBRA continuation coverage); (3)
there has been no "prohibited transaction," as such term is defined in Section
406 of ERISA or Section 4975 of the Code, with respect to any E3 U.S. Employee
Plan: (4) none of E3, any Subsidiary or any ERISA Affiliate is subject to any
liability or penalty under Sections 4976 through 4980 of the Code or Title I of
ERISA; (5) all contributions required to be made by E3, any Subsidiary or ERISA
Affiliate to any E3 U.S. Employee Plan have been timely paid or accrued; (6)
each E3 U.S. Employee Plan has timely filed all requisite governmental reports
(which were true and correct as of the date filed) and has properly and timely
filed and distributed or posted all required notices and reports to Employees;
and (7) no suit, administrative proceeding, action or other litigation has been
brought, or to the knowledge of E3 is threatened, against or with respect to any
such E3 U.S. Employee Plan, including any audit or inquiry by the IRS or United
States Department of Labor.

                  (iii) None of E3, any Subsidiary or any ERISA Affiliate has
ever maintained, established, sponsored, participated in, contributed to, or is
obligated to contribute to, or otherwise incurred any obligation or liability
(including, without limitation, any contingent liability) under any
"multiemployer plan" (as defined in Section 3(37) of ERISA) or to any "pension
plan" (as defined in Section 3(2) of ERISA) subject to Title IV of ERISA or
Section 412 of the Code. None of E3, any Subsidiary or any ERISA Affiliate has
any actual or potential withdrawal liability (including, without limitation, any
contingent liability) for any complete or partial withdrawal (as defined in
Sections 4203 and 4205 of ERISA) from any multiemployer plan.

                  (iv)  With respect to each E3 U.S. Employee Plan, E3 and each
of its United States Subsidiaries have complied in all material respects with
and have no unsatisfied obligations (other than obligations that can only be
satisfied under applicable law with the passage of time) under (1) the
applicable health care continuation and notice provisions of COBRA and the
regulations thereunder or any state Law governing health care coverage extension
or continuation; (2) the applicable requirements of the Family and Medical Leave
Act of 1993 and the regulations thereunder; (3) the applicable requirements of
the Health Insurance


                                       30
   35
Portability and Accountability Act of 1996; and (4) the applicable requirements
of the Cancer Rights Act of 1998.

                  (v)   No benefit payable or which may become payable by E3
pursuant to any E3 U.S. Employee Plan or as a result of or arising under this
Agreement shall constitute an "excess parachute payment" (as defined in Section
280G(b)(1) of the Code) which is subject to the imposition of an excise Tax
under Section 4999 of the Code or the deduction for which would be disallowed by
reason of Section 280G of the Code. Each E3 U.S. Employee Plan can be amended,
terminated or otherwise discontinued after the Effective Time in accordance with
its terms, without material liability to JDA or E3 (other than ordinary
administration expenses typically incurred in a termination event).

            (d)   With respect to each E3 International Employee Plan, E3 has
furnished to JDA true and complete copies of documents embodying each E3
International Employee Plan and related plan documents, including (without
limitation) the most recent actuarial estimates of liabilities, audited
financial statements for each E3 International Employee Plan for the last three
years, trust documents, group annuity contracts, plan amendments, insurance
policies or contracts, participant agreements, employee booklets, administrative
service agreements, summary plan descriptions, registration statements and
prospectuses. Except as required by Law, no condition exists that would prevent
E3 or JDA from terminating or amending any E3 International Employee Plan at any
time for any reason.

      Section 3.16 Compliance with Laws. Each Acquired Entity has complied with,
is not in violation of, and has not received any notices of violation with
respect to, any Law applicable to the ownership or operation of its business
except for violations or other instances of non-compliance which would not have
a Material Adverse Effect on E3.

      Section 3.17 Employees and Consultants.

            (a)   The E3 Disclosure Schedule contains a complete and accurate
list of the names of all Employees and Consultants of each Acquired Entity as of
the date of this Agreement and their salaries or wages, other compensation,
dates of employment/service and positions.

            (b)   Prior to the Closing, E3 has made available to JDA correct and
complete copies of all contracts, agreements, plans, and commitments with
respect to all Employees pertaining to terms of employment, compensation,
bonuses, profit sharing, securities purchases, securities repurchases, options,
deferred compensation arrangements or plans, commissions, incentives, loans or
loan guarantees, severance pay or benefits, use of company property,
noncompetition and other restrictive covenants, and related matters. Schedule
3.17(b) contains a list of all such contracts, agreements, plans and
commitments. E3 and each Acquired Entity is in material compliance with and not
in violation of any agreements and/or arrangements with any Employee or
Consultant.

            (c)   E3 and each Acquired Entity are in material compliance with
respect to its Employees and Consultants with all currently applicable Laws and
its own policies with respect to or affecting employment, employment practices,
discrimination in employment, terms and


                                       31
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conditions of employment, wages, hours and occupational safety and health and
employment practices, equal opportunity, civil rights, labor relations, payroll
taxes, any federal, state, provincial or local human rights act and immigration
and are not engaged in any unfair labor practice. Neither E3 nor any Acquired
Entity has received any written notice from any Governmental Entity and, to the
knowledge of E3 or any Acquired Entity, there has not been asserted before any
Governmental Entity, any current claim, action or proceeding to which E3 or any
Acquired Entity is a party relating to the Employees and there is neither
pending nor, to the knowledge of E3 or any Acquired Entity, has there been
threatened in writing, any investigation or hearing to which E3 or any Acquired
Entity is a party relating to the Employees of E3 or any Acquired Entity arising
out of or based upon any such Laws. There is no pending claim against E3 or any
Acquired Entity relating to the Employees of E3 or any Acquired Entity under any
workers' compensation plan or statute.

            (d)   To the knowledge of E3, a sufficient number of Employees with
software development responsibilities have not expressed to a director,
corporate officer (with a title of president or vice president, including
President-Europe), the senior legal counsel or senior regional manager their
firm intention to leave their employment such that their departure would
collectively have an Material Adverse Effect on E3.

            (e)   Except as set forth on the E3 Disclosure Schedule, there is no
employment agreement in force between any Acquired Entity and any of their
respective directors, managers or officers which is not terminable by the
appropriate Acquired Entity without compensation on less than three months'
notice given at any time. Except as set forth on the E3 Disclosure Schedule,
there are no material consultancy or management services agreements in existence
between any Acquired Entity and any other person, firm or company, and there are
no material collective bargaining agreements between any Acquired Entity or any
employers or trade association of which the Acquired Entity is a member and any
trade union, staff association or other body representing Employees or a
substantial number of them. E3 has made available to JDA correct and complete
copies of each agreement listed on the E3 Disclosure Schedule, each as amended
to date. Each such agreement is legal, valid and binding on the applicable
Acquired Entity and, to E3's knowledge, the other party or parties thereto. The
terms of all such agreements have been complied with in all material respects by
the applicable Acquired Entity and, to E3's knowledge, by the other parties to
such agreements. No event, occurrence or condition exists that, with the lapse
of time, the giving of notice, or both, would become a default under any such
agreement by any Acquired Entity or, to E3's knowledge.

      Section 3.18 Litigation. There is no action, suit, proceeding, claim,
arbitration or investigation pending before any agency, court or tribunal or, to
the knowledge of any Acquired Entity, threatened against any Acquired Entity or
any of its properties or officers, managers or directors (in their capacities as
such). There is no judgment, decree or order against any Acquired Entity or, to
the knowledge of any Acquired Entity, any of its officers, managers or directors
(in their capacities as such) that could reasonably be expected to prevent,
enjoin or materially alter or delay any of the transactions contemplated by this
Agreement, or that could reasonably be expected to have a Material Adverse
Effect on E3. All litigation to which any Acquired Entity is a party (or, to the
knowledge of any Acquired Entity, threatened to become a party) is disclosed in
the E3 Disclosure Schedule.


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   37
         Section 3.19 Restrictions on Business Activities. There is no
agreement, judgment, injunction, order, decree or proceeding of, by or with any
Governmental Entities binding upon any Acquired Entity which has or could
reasonably be expected to have the effect of prohibiting or materially impairing
any current business practice of any Acquired Entity, any acquisition of
property by any Acquired Entity or the conduct of business by any Acquired
Entity as currently being conducted or as currently proposed to be conducted.

         Section 3.20 Governmental Authorization. Each Acquired Entity has
obtained each governmental Consent, license, grant or other authorization of a
Governmental Entity that is required for the operation of the business of that
Acquired Entity, including with respect to government subsidies, customer tax
exemptions, holidays and the like other than authorizations that would not have
a Material Adverse Effect on E3 (collectively, the "E3 AUTHORIZATIONS"), and all
of such E3 Authorizations are in full force and effect. E3 has provided JDA with
a complete written list of all E3 Authorizations. No Acquired Entity nor, to the
knowledge of any Acquired Entity, any Employee of any Acquired Entity has
received any notice from a Governmental Entity of its intention to cancel,
terminate or not renew any E3 Authorization and no E3 Authorization will be lost
or adversely impacted as a result of the consummation of the transaction under
this Agreement.

         Section 3.21 Insurance. The E3 Disclosure Schedule contains a list of
all insurance policies of the Acquired Entities. There is no material claim
pending under any of such policies as to which coverage has been questioned,
denied or disputed by the underwriters of such policies. All premiums due and
payable under all policies currently in force or issued in the past have been
paid, and each Acquired Entity is otherwise in material compliance with the
terms of such policies. No Acquired Entity has any knowledge of any threatened
termination of, or material premium increase with respect to, any of such
policies. No policy currently in force or issued to any Acquired Entity in the
past is subject to any retrospective rating or retrospective premium provision,
premium recapture provision, or similar provision.

         Section 3.22 Interested Party Transactions.

              (a) No director, officer or ten percent (10%) Shareholder of any
Acquired Entity has any interest in (i) any equipment or other property or
asset, real or personal, tangible or intangible, including, without limitation,
any of the E3 Intellectual Property Rights, used in connection with or
pertaining to the business of any Acquired Entity, (ii) any creditor, supplier,
customer, manufacturer, agent, representative, or distributor of any of the
products of any Acquired Entity, (iii) any entity that competes with any
Acquired Entity, or with which any Acquired Entity is affiliated or has a
business relationship, or (iv) any agreement, obligation or commitment, written
or oral, to which any Acquired Entity is a party; provided, however, that no
such person shall be deemed to have such an interest solely by virtue of
ownership of less than one percent (1%) of the outstanding stock or debt
securities of any company whose stock or debt securities are traded on a
recognized stock exchange or quoted on NASDAQ.

              (b) Except as contemplated by the Transaction Documents or
otherwise set forth in the E3 Disclosure Schedule, no Acquired Entity is (i) a
party to any agreement with any director, officer, manager or other Employee of
any Acquired Entity the benefits of which are contingent, or the terms of which
would be materially altered, upon the occurrence of the


                                       33
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transactions contemplated by this Agreement, (ii) a party to any agreement or
plan, including, without limitation, any stock option plan, stock appreciation
right plan or stock purchase plan, any of the benefits of which will be
increased, or the vesting of benefits of which will be accelerated, by the
occurrence of any of the transactions contemplated by this Agreement or the
value of any of the benefits of which will be calculated on the basis of any of
the transactions contemplated by this Agreement, (iii) indebted to any director,
officer, senior regional manager or ten percent (10%) Shareholder of any
Acquired Entity (except for amount due as normal salaries and bonuses and in
reimbursement of ordinary expenses), or (iv) a party to any agreement or
arrangement for the loan of money to any director, officer, senior regional
manager or ten percent (10%) Shareholder of any Acquired Entity.

         Section 3.23 No Existing Discussions. To the extent that E3 or any
Acquired Entity is in discussions with a third party with respect to a private
equity financing, E3 or the Acquired Entity has the legal right to terminate or
suspend any such pending negotiations.

         Section 3.24 Real Property Holding Corporation. No Acquired Entity is,
or has been, a "United States real property holding corporation" within the
meaning of Section 897(c)(2) of the Code during the applicable period specified
in Section 897(c)(1)(A)(ii) of the Code.

         Section 3.25 Corporate Documents. Each Acquired Entity has made
available to JDA, or its representatives, for its examination (i) its minute
book and other corporate records, in accordance with local Law, containing all
records required to be set forth of all proceedings, consents, actions, and
meetings of the shareholders or equity holders, the Board of Directors or other
relevant management body and any committees thereof, (ii) its stock register,
equity register or local Law equivalent evidencing the ownership interests in
the Acquired Equity, and (iii) all Consents issued by any Governmental Entity
with respect to that Acquired Entity (together, the "CORPORATE DOCUMENTS"). The
Corporate Documents are complete and accurate in all material respects, and the
signatures appearing on all documents contained therein are the true signatures
of the persons purporting to have signed the same. All actions reflected in the
Corporate Documents were duly and validly taken in compliance with the Laws of
the applicable jurisdiction. E3 has made available to JDA or its representatives
true and complete copies of all documents which are referred to in the E3
Disclosure Schedule.

         Section 3.26 Aliens. All Employees in the United States of the Acquired
Entities are, to the knowledge of E3 (including any constructive knowledge the
IRCA may deem E3 to have), (i) citizens of the United States or (ii) not
citizens of the United States, but, in accordance with the IRCA and other
applicable federal governmental requirements, are either (A) immigrants
authorized to work in the United States or (B) nonimmigrants authorized to work
in the United States for E3 in their specific jobs. Since November 6, 1986 no
Acquired Entity has (i) hired (or by reason of any contract, subcontract or
exchange is considered for purposes of the IRCA to have hired) an alien in the
United States to perform labor or services in the United States with knowledge
(as determined in accordance with the IRCA) that the alien is an unauthorized
alien with respect to performing that labor or those services, (ii) continued
the employment of any Employee hired after November 6, 1986 with knowledge (as
determined in accordance with the IRCA) that the Employee is or has become an
unauthorized alien with respect to that employment or (iii) directly or
indirectly in violation of the IRCA required any individual it has hired to post
a bond or security or provide any other financial assurance to it against any


                                       34
   39
potential liability under the IRCA as a result of that hire. E3 has provided JDA
with a true, complete list of all current alien Employees of the Acquired
Entities who (i) are authorized to work in the United States as immigrants or
(ii) hold H-1B, H-2B or other nonimmigrant visas. E3 has made available to JDA
with respect to each current Employee of the Acquired Entities who has an H-1B
or H-2B visa, true, complete copies of the Department of Labor File and Public
Access File the Acquired Entities have maintained with respect to that Employee.
E3 also has made available to JDA true, complete copies of all Forms I-9 the
Acquired Entities possess with respect to their (i) current Employees, (ii)
former Employees whose employment was terminated within 12 months of the date
hereof and who were employed for more than 36 months and (iii) former Employees
whose employment was terminated within 36 months of the date hereof and who were
employed for less than 36 months. Each Acquired Entity has obtained, completed
and maintained Form I-9s in accordance with, and has otherwise complied with the
record-keeping requirements of, the IRCA.

         Section 3.27 Indemnification Claims. The E3 Disclosure Schedules sets
forth a list of all persons who are parties to director, officer and/or employee
indemnification agreements with E3 or the Subsidiaries. Except as set forth in
the E3 Disclosure Schedules, there are no outstanding claims under any of such
indemnification agreements or under any indemnification rights granted pursuant
to the Articles of Incorporation, Bylaws or other charter documents of E3 or the
E3 Subsidiaries (as currently in effect); and, to E3's knowledge, there are no
facts or circumstances that either now, or with the passage of time, would
reasonably be expected to provide a basis for a claim under any such
indemnification agreement or under any indemnification rights granted pursuant
to the Certificate of Incorporation, Bylaws or other charter documents of E3 or
the E3 Subsidiaries.

         Section 3.28 Power of Attorney. Neither E3 nor any of the E3
Subsidiaries has granted to any person a power of attorney or similar
authorization of a material nature that is currently in effect of authority.

         Section 3.29 No Misrepresentation. No representation or warranty by any
Acquired Entity in this Agreement, or any document, exhibit, statement,
certificate or Schedule furnished or to be furnished by or on behalf of any
Acquired Entity pursuant to this Agreement, when taken together, contains or
shall contain any untrue or incorrect statement of a material fact or omits or
shall omit to state a material fact required to be stated therein or necessary
in order to make such statements, in light of the circumstances under which they
were made, not misleading.

                                  ARTICLE IIIA

           REPRESENTATIONS AND WARRANTIES OF EACH SIGNING SHAREHOLDER

         Except as disclosed in the E3 Disclosure Schedule, each of the Signing
Shareholders represents and warrants, as applied solely to himself, as follows:

         Section 3A.1 Ownership and Status of E3 Common Stock. The Signing
Shareholder is the record and beneficial owner of the number of shares of E3
Common Stock set forth opposite the Shareholder's name in the E3 Disclosure
Schedule, free and clear of all Liens.


                                       35
   40
         Section 3A.2 Power of the Signing Shareholder; Approval of the Merger.

              (a) The Signing Shareholder has the requisite power, legal
capacity and authority to execute and deliver this Agreement and each other
Transaction Document to which the Signing Shareholder is a party and to perform
the Signing Shareholder's obligations in this Agreement and in all other
Transaction Documents to which the Signing Shareholder is a party. This
Agreement constitutes, and each such other Transaction Document, when executed
in the Signing Shareholder's individual capacity and delivered by the Signing
Shareholder, will constitute, the legal, valid and binding obligation of the
Signing Shareholder, enforceable against the Signing Shareholder in accordance
with its terms, except as that enforceability may be (i) limited by an
applicable bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium or similar Laws affecting the enforcement of creditors' rights
generally or any applicable Law that limits rights to indemnification and (ii)
subject to general principles of equity (regardless of whether that
enforceability is considered in a proceeding in equity or at Law).

              (b) The Signing Shareholder, acting in each capacity in which he
is entitled, by reason of E3's charter documents or the Laws of E3's state of
organization or for any other reason, to vote to approve or disapprove the
consummation of the Merger, has voted all the shares of E3 Common Stock owned by
him and entitled to a vote or votes on that matter, in any one or more of the
manners prescribed or permitted by E3's charter documents or the Laws of E3's
state of organization, whichever are controlling, to approve and adopt this
Agreement and to approve the Merger and the other transactions contemplated by
this Agreement or by any of the other Transaction Documents.

         Section 3A.3 No Conflicts or Litigation. The Signing Shareholder's
execution, delivery and performance in accordance with their respective terms of
this Agreement and the other Transaction Documents to which the Signing
Shareholder is a party do not and will not (i) violate or conflict with any Law,
(ii) breach or constitute a default under any agreement or instrument to which
the Signing Shareholder is a party or by which the Shareholder or any shares of
E3 Common Stock the Signing Shareholder owns is bound, or (iii) result in the
creation or imposition of, or afford any person the right to obtain, any Lien
upon any shares of E3 Common Stock the Signing Shareholder owns (or upon any
revenues, income or profits of the Signing Shareholder therefrom). No action,
suit, proceeding, claim, arbitration or investigation is pending or, to the
knowledge of the Signing Shareholder, threatened to which the Signing
Shareholder is or may reasonably be expected to become a party which (i)
questions or involves the validity or enforceability of any of the Signing
Shareholder's obligations under any Transaction Document or (ii) seeks (or
reasonably may be expected to seek) (A) to prevent or delay the consummation by
the Signing Shareholder of the transactions this Agreement contemplates the
Signing Shareholder will consummate or (B) damages in connection with any such
consummation.

         Section 3A.4 Preemptive and Other Rights; Waiver. Except for the right
of the Signing Shareholder to receive shares of JDA Common Stock constituting
the Stock Merger Consideration as a result of the Merger, the Signing
Shareholder either (i) does not own or otherwise have any statutory or
contractual preemptive or other right of any kind (including any right of first
offer or refusal) to acquire any shares of E3 Common Stock or JDA Common Stock


                                       36
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or (ii) hereby irrevocably waives each right of that type the Signing
Shareholder does own or otherwise has.

         Section 3A.5 Accredited Investor Status; Sophistication. The Signing
Shareholder (i) will be acquiring the shares of JDA Common Stock to be issued to
him pursuant to this Agreement solely for his account, for investment purposes
only and with no current intention or plan to distribute, sell or otherwise
dispose of any of those shares in connection with any distribution and (ii) is
not a party to any agreement or other arrangement for the disposition of any
shares of JDA Common Stock other than this Agreement. The Signing Shareholder is
an "accredited investor" as defined in Securities Act Rule 501(a). The Signing
Shareholder (i) is able to bear the economic risk of an investment in the JDA
Common Stock acquired pursuant to this Agreement, (ii) can afford to sustain a
total loss of that investment, (iii) has such knowledge and experience in
financial and business matters that he is capable of evaluating the merits and
risks of the proposed investment in the JDA Common Stock and (iv) has had an
adequate opportunity to ask questions and receive answers from the officers of
JDA concerning any and all matters relating to the transactions contemplated
hereby and thereby including the background and experience of the current and
proposed officers and directors of JDA, and the plans for the business and
operation of JDA.

                                   ARTICLE IV

                  REPRESENTATIONS AND WARRANTIES OF JDA AND SUB

         Except as set forth in the JDA Disclosure Schedule, JDA and Sub
represent and warrant to E3 as follows:

         Section 4.1 Organization. Each of JDA and Sub is a corporation duly
organized, validly existing and in good standing (or its local Law equivalent,
as applicable) under the Laws of the jurisdiction of its organization, has all
requisite corporate power to own, lease and operate its property and to carry on
its business as now being conducted and as proposed to be conducted, and is duly
qualified to transact business and is in good standing as a foreign corporation
in each jurisdiction in which the failure to be so qualified would have a
Material Adverse Effect on JDA.

         Section 4.2 JDA Capital Structure.

              (a) The authorized capital stock of JDA consists of 50,000,000
shares of JDA Common Stock and 2,000,000 shares of Preferred Stock, $1.00 par
value, of which 500,000 shares of have been designated Series A Preferred Stock.
As of August 10, 2001, 24,840,977 shares of JDA Common Stock and no shares of
JDA Series A Preferred Stock were issued and outstanding, all of which had been
duly authorized and validly issued and were fully paid and nonassessable. No
material change in such capitalization has occurred between August 10, 2001 and
the date of this Agreement. All of the outstanding shares of capital stock of
Sub have been duly authorized and validly issued and are fully paid and
nonassessable, and all such shares are owned by JDA, free and clear of all
Liens. The authorized capital stock of Sub consists of 100,000 shares of common
stock, par value $0.001 per share, all of which are issued and outstanding and
owned by JDA.


                                       37
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              (b) The shares of JDA Common Stock to be issued pursuant to the
Merger, when issued in accordance with the terms of this Agreement, will be (i)
duly authorized, validly issued, fully paid and nonassessable, (ii) free and
clear of any security interests, pledges, mortgages, claims, Liens and
encumbrances of any kind whatsoever and (iii) assuming the truth and accuracy of
the statements, representations and warranties made by the Shareholders to JDA
in connection therewith, will be issued in compliance with all applicable
federal and state securities laws.

         Section 4.3 Authority; No Conflict; Required Filings and Consents.

              (a) JDA and Sub have all requisite corporate power and authority
to execute and deliver this Agreement and the other Transaction Documents to
which they are or will be parties and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement
and the other Transaction Documents to which JDA or Sub is or will be a party
and the consummation of the transactions contemplated hereby and thereby have
been duly authorized by all necessary corporate action on the part of JDA and
Sub, respectively. This Agreement has been, and the other Transaction Documents
to which JDA and/or Sub are parties have been or will be when they are executed
by JDA and/or Sub, as applicable, duly executed and delivered by JDA and/or Sub
and constitute, or will constitute when they are executed by E3 and/or Sub, as
applicable, the valid and binding obligations of JDA and/or Sub, enforceable
against JDA and/or Sub, as the case may be, in accordance with their respective
terms, except as such enforceability may be limited by (i) bankruptcy Laws and
other similar Laws affecting creditors' rights generally and (ii) general
principles of equity.

              (b) The execution and delivery by JDA and Sub of this Agreement
and the other Transaction Documents to which they are or will be parties do not,
and the consummation of the transactions contemplated hereby and thereby will
not, (i) conflict with, or result in any violation or breach of any provision of
the Certificate of Incorporation or Bylaws of JDA or Sub, (ii) result in any
violation or breach of, or constitute (with or without notice or lapse of time,
or both) a default under, or give rise to a right of termination, cancellation
or acceleration of any material obligation or loss of any material benefit
under, any note, mortgage, indenture, lease, contract or other agreement,
instrument or obligation to which JDA or Sub is a party or by which either of
them or any of their properties or assets may be bound, or (iii) conflict with
or violate any permit, concession, franchise, license, judgment or Law,
applicable to JDA or Sub or any of its or their properties or assets, except in
the case of (ii) and (iii) for any such conflicts, violations, defaults,
terminations, cancellations or accelerations which would not be reasonably
likely to have a Material Adverse Effect on JDA.

              (c) No Consent from any Governmental Entity is required by or with
respect to JDA or any of its Subsidiaries in connection with the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby, except for (i) the filing of a pre-merger notification and report forms
by E3 and JDA and, if required, by some or all of the Shareholders, under the
HSR Act, (ii) the filing of the Certificate of Merger with the Delaware
Secretary of State, (iii) if required, the filing of a report on Form 8-K with
the SEC, (iv) such Consents as may be required under applicable federal and
state securities Laws in the United States and the securities Laws of other
relevant jurisdictions, and (v) such other Consents which, if not obtained or
made, would not prevent or materially alter or delay any of the


                                       38
   43
transactions contemplated by this Agreement or be reasonably likely to have a
Material Adverse Effect on JDA.

         Section 4.4 SEC Filings; Financial Statements.

              (a) JDA has timely filed all JDA SEC Reports. Each of the JDA SEC
Reports (i) at the time it was filed, complied in all material respects with the
applicable requirements of the Exchange Act, as the case may be, and (ii) did
not at the time it was filed (or if amended or superseded by a filing prior to
the date of this Agreement, then on the date of such filing) contain any untrue
statement of a material fact or omit to state a material fact required to be
stated in such JDA SEC Report or necessary in order to make the statements in
such JDA SEC Report, in the light of the circumstances under which they were
made, not misleading.

              (b) Each of the consolidated financial statements (including, in
each case, any related notes) contained in the JDA SEC Reports, including any
JDA SEC Reports filed after the date of this Agreement until the Closing,
complied or when filed will comply as to form in all material respects with the
applicable published rules and regulations of the SEC with respect thereto, was
or will be prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes to such
financial statements or, in the case of unaudited statements, as permitted by
Form 10-Q promulgated by the SEC) and presented fairly or when filed will
present fairly, in all material respects, the consolidated financial position of
JDA and its Subsidiaries as of the respective dates, and the consolidated
results of its operations and cash flows for the periods indicated, except that
the unaudited interim financial statements were or when filed are subject to
normal and recurring year-end adjustments which were not or are not expected to
be material in amount.

         Section 4.5 Absence of Undisclosed Liabilities. JDA does not have any
liabilities of any kind whatsoever, whether accrued, contingent, absolute,
determined, determinable or otherwise, (whether or not required to be reflected
in financial statements in accordance with GAAP), and whether due or to become
due, which individually or in the aggregate would be reasonably likely to have a
Material Adverse Effect on JDA, other than (i) liabilities reflected or provided
for on the JDA Balance Sheet, (ii) liabilities specifically contemplated by this
Agreement, or described in the JDA SEC Reports, and (iii) normal or recurring
liabilities incurred since the date of the JDA Balance Sheet, in the ordinary
course of business consistent with past practices.

         Section 4.6 Absence of Certain Changes or Events. Since the date of the
JDA Balance Sheet, JDA has not suffered any event or occurrence that has had, or
is reasonably likely to have, a Material Adverse Effect on JDA or that would
require JDA to file with the SEC a current report on Form 8-K or amend any prior
filing made by JDA with the SEC.

         Section 4.7 Litigation. Except as described in the JDA SEC Reports, if
any, there is no action, suit or proceeding, claim, arbitration or investigation
against JDA pending or as to which JDA has received any written notice of
assertion, which is reasonably likely to have a Material Adverse Effect on JDA
or a material adverse effect on the ability of JDA to consummate the
transactions contemplated by this Agreement.


                                       39
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         Section 4.8 Board Approval and Recommendation. On or prior to the date
hereof, the board of directors of JDA has (i) determined that the Merger is
advisable to and in the best interests of JDA, and (ii) approved this Agreement
and the transactions contemplated hereby, including the Merger.

         Section 4.9 Tax Treatment. Neither JDA nor any of its Subsidiaries has
taken, proposes to take, or has agreed to take action that would prevent the
Merger from constituting a reorganization qualifying under the provisions of
Section 368(a) of the Code.

         Section 4.10 No Prior Activities. Except for obligations incurred in
connection with its incorporation or organization or the negotiation or
consummation of this Agreement and the transactions contemplated hereby, Sub has
neither incurred any obligation or liability nor engaged in any business or
activity of a type or kind or entered into any agreement or arrangement with any
person.

                                   ARTICLE V

                               CONDUCT OF BUSINESS

                             [INTENTIONALLY DELETED]


                                   ARTICLE VI

                              ADDITIONAL AGREEMENTS

              (a) No Solicitation. Intentionally Deleted.

         Section 6.2 Access to Information. Intentionally Deleted.

         Section 6.3 Legal Conditions to Merger. Each of JDA, E3 and the E3
Subsidiaries will take all reasonable actions necessary to comply promptly with
all legal requirements which may be imposed on itself with respect to the Merger
(which actions shall include, without limitation, furnishing all information in
connection with approvals of or filings with any Governmental Entity) and will
promptly cooperate with and furnish information to each other in connection with
any such requirements imposed upon either of them or any of their Subsidiaries
in connection with the Merger. Each of JDA and E3 will take all reasonable
actions necessary to obtain (and will cooperate with each other in obtaining)
any Consent, or any exemption by, any Governmental Entity or other third party,
required to be obtained or made by E3, JDA or any of their Subsidiaries in
connection with the Merger or the taking of any action contemplated thereby or
by this Agreement and to enable the Closing to occur as promptly as practicable.

         Section 6.4 Public Disclosure. JDA and E3 shall consult with each other
before issuing any press release or otherwise making any public statement with
respect to the Merger or this Agreement and shall not issue any such press
release or make any such public statement prior to such consultation.

         Section 6.5 Tax-Free Reorganization. JDA and E3 each intend that the
Merger shall qualify for treatment as a reorganization within the meaning of
Section 368(a) of the Code. JDA


                                       40
   45
and E3 each agree to refrain from taking any action inconsistent with such
intended treatment. JDA and E3 agree to make reasonable representations
substantially in the form of the tax certificates attached hereto as Exhibits F
and G, as requested by counsel to JDA and E3 with respect to the rendering of
the opinions required pursuant to Section 7.1(d).

         Section 6.6 E3 401(k) Plan. E3 agrees to terminate its 401(k) plan
effective as of the day immediately preceding the Closing Date. Unless Sub
provides such notice, E3 shall deliver to Sub evidence that E3's 401(k) plan has
been terminated effective as of the day immediately preceding the Closing Date
pursuant to resolutions of E3's Board of Directors (the form and substance of
which resolutions shall be subject to review and approval of JDA), effective as
of the day immediately preceding the Closing Date.

         Section 6.7 Brokers or Finders. E3 represents, as to itself, the E3
Subsidiaries and its Affiliates, and each Signing Shareholder represents, as to
himself, that, except as set forth in Schedule 6.7, no agent, broker, investment
banker, financial advisor or other firm or person is or will be entitled to any
broker's or finder's fee or any other commission or similar fee in connection
with any of the transactions contemplated by this Agreement, and the Signing
Shareholders agree jointly and severally to indemnify and hold JDA and E3
harmless from and against any and all claims, liabilities or obligations with
respect to any other fees, commissions or expenses not set forth in Schedule 6.7
asserted by any person including First Union Securities, Inc., financial advisor
to E3, on the basis of any act, statement or agreement made or alleged to have
been made by E3, any Subsidiary or Affiliate of E3, or any Signing Shareholder.

         Section 6.8 Additional Agreements; Reasonable Efforts. Subject to the
terms and conditions of this Agreement, each of the parties agrees to use their
commercially reasonable efforts to take, or cause to be taken, all action and to
do, or cause to be done, all things necessary, proper or advisable under
applicable Laws and regulations to consummate and make effective the
transactions contemplated by this Agreement, including cooperating fully with
the other party, including by provision of information. In case at any time
after the Effective Time any further action is necessary or desirable to carry
out the purposes of this Agreement or to vest the Surviving Corporation with
full title to all properties, assets, rights, approvals, immunities and
franchises of either of the Constituent Corporations, the proper officers and
directors of each party to this Agreement shall take all such necessary action.

         Section 6.9 Expenses. The parties shall each pay their own legal,
accounting, financial advisory and consulting fees and other out-of-pocket
expenses related to the negotiation, preparation and carrying out of this
Agreement and the transactions herein contemplated. In the event the Merger is
consummated, all (i) Taxes applicable to the transfer of E3 Common Stock and the
equity or other ownership interests of the E3's Subsidiaries, as contemplated by
this Agreement; and (ii) legal, accounting, financial advisory and consulting
fees and expenses incurred by E3 on behalf of itself or the Shareholders
(whether paid or accrued), including those referred to in Section 6.7, relating
to the negotiation, preparation and carrying out of this Agreement and the
transactions contemplated hereby through the Closing Date, and obtaining all
Consents from Governmental Entities in connection with such transactions (the
"E3 TRANSACTION EXPENSES") shall become the liabilities of the Surviving
Corporation as a result of the Merger. E3 shall provide an updated Schedule of
Estimated E3 Transaction Expenses not later than two (2) business days prior to
the Closing (the "CLOSING E3 TRANSACTION EXPENSE SCHEDULE"). The


                                       41
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amount of E3 Transaction Expenses set forth on the Closing E3 Transaction
Expense Schedule shall be used to calculate the Cash Merger Consideration. In
the event the E3 Transaction Expenses actually incurred by E3 include Excess E3
Transaction Expenses, JDA shall be entitled to assert a claim against the
Escrowed Cash pursuant to Article IX hereof (without regard to the Floor Amount)
in order to recover all such additional expenses, but only to the extent such
amounts have not been reflected in the calculation of the Merger Consideration
paid at Closing.

         Section 6.10 Updating Schedules. Intentionally Deleted.

         Section 6.11 Directors and Officers of Subsidiaries. The parties agree
that the directors, officers and managers of the Subsidiaries of the Surviving
Corporation immediately after the Closing shall be as set forth on Schedule 1.4,
and the parties agree to take or cause to be taken all actions necessary to
elect or nominate and qualify such persons for such offices or directorships.

                                   ARTICLE VII

                              CONDITIONS TO MERGER

         Section 7.1 Conditions to Each Party's Obligation to Effect the Merger.
The respective obligations of each party to this Agreement to effect the Merger
shall be subject to the satisfaction on or prior to the Closing Date of the
following conditions:

              (a) HSR Period. The waiting period (and any extension thereof)
applicable to the Merger under the HSR Act shall have been terminated or shall
have expired.

              (b) Governmental Approvals. All Consents, or expirations of
waiting periods imposed by, any Governmental Entity the failure of which to
obtain or comply with would be reasonably likely to have a Material Adverse
Effect on JDA or E3 or a material adverse effect on the consummation of the
transactions contemplated hereby shall have been filed, occurred or been
obtained.

              (c) No Injunctions or Restrictions; Illegality. No temporary
restraining order, preliminary or permanent injunction or other order issued by
any court of competent jurisdiction or other legal or regulatory restraint or
prohibition preventing the consummation of the Merger or limiting or restricting
JDA's conduct or operation of the business of JDA or E3 after the Merger shall
have been issued, nor shall any proceeding brought by any Governmental Entity
seeking any of the foregoing be pending; nor shall there be any action taken, or
any Law enacted, entered, enforced or deemed applicable to the Merger which
makes the consummation of the Merger illegal.

              (d) Tax Opinion. JDA shall have received a written opinion from
its counsel, Gray Cary Ware & Freidenrich LLP, and E3 shall have received a
written opinion from its counsel, Morris, Manning & Martin, LLP, in form and
substance reasonably satisfactory to both parties, to the effect that the Merger
will be treated for federal income tax purposes as a tax-free reorganization
within the meaning of Section 368(a) of the Code. The opinion condition referred
to in this section shall not be waivable unless approval of the opposing party
is obtained with appropriate disclosure. In rendering such opinions, counsel may
rely upon reasonable


                                       42
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representations from JDA and E3 substantially in the form of the tax
certificates attached hereto as Exhibit F and G.

         Section 7.2 Additional Conditions to Obligations of JDA and Sub. The
obligations of JDA and Sub to effect the Merger are subject to the satisfaction
of each of the following conditions, any of which may be waived in writing
exclusively by JDA:

              (a) Representations and Warranties. The representations and
warranties of E3 and the Signing Shareholders set forth in this Agreement shall
be true and correct as of the date of this Agreement and as of the Closing Date
as though made on and as of the Closing Date, except (i) for changes
contemplated by this Agreement, (ii) that representations and warranties which
specifically relate to a particular date or period shall be true and correct as
of such date or for such period and (iii) where the failure of any such
representation or warranty to be true and correct on and as of the Closing Date,
individually and in the aggregate, would not be reasonably likely to have a
Material Adverse Effect on E3, or a material adverse effect upon the
consummation of the transactions contemplated hereby; and JDA shall have
received a certificate to such effect signed on behalf of E3 by the chief
executive officer and the president of E3. For purposes of this subsection
7.2(a), the following events or occurrences shall not be deemed to be events or
occurrences having a Material Adverse Effect on E3: (i) increases or decreases
in the trading price of JDA Common Stock, as reported on the NASDAQ, occurring
at any time or from time to time between the date hereof and the Closing Date;
(ii) events or occurrences affecting the general economy or the industries or
segments of the industries in which JDA or E3 do business, generally; or (iii)
events or occurrences related directly to the Merger or the other transactions
contemplated by this Agreement.

              (b) Performance of Obligations. E3 shall have performed in all
material respects all obligations required to be performed by it or shall have
refrained taking any actions prohibited under this Agreement at or prior to the
Closing Date, and JDA shall have received a certificate to such effect signed on
behalf of E3 by the chief executive officer of E3.

              (c) Approval. JDA shall have received from E3 written evidence
that the execution, delivery and performance of E3's obligations under this
Agreement have been duly and validly approved and authorized by the Board of
Directors and by the Shareholders of E3.

              (d) Third Party Consents. JDA shall have been furnished with
evidence satisfactory to it of the Consent of those persons whose consent or
approval shall be required in connection with the Merger under the material
contracts of E3 or material licenses or permits, as set forth in Schedule 7.2(d)
hereto.

              (e) Medical Benefits Agreements. Concurrently herewith the Medical
Benefits Agreements in the form attached as Exhibit H hereto shall have been
executed by JDA and each of Anders Herlitz, Frank Schuster and William Huther,
to be effective as of the Closing. As of the Closing, all of such agreements
shall be in full force and effect in accordance with their terms.


                                       43
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              (f) Opinion of E3 Counsel. JDA shall have received a legal opinion
from Morris, Manning & Martin, LLP, counsel to E3, substantially in the form of
Exhibit I attached hereto.

              (g) Escrow Agreement. The Escrow Agreement shall have been
executed and delivered by the Shareholders' Representative and the Escrow Agent.

              (h) Blue Sky. JDA shall have received all permits or other
authorizations required under applicable state blue sky Laws, or similar Laws of
any foreign jurisdiction, for the issuance of JDA Common Stock pursuant to the
Merger.

              (i) Resignations. JDA shall have received from each officer and
director of each Acquired Entity, a resignation effective as of the Closing from
each office or directorship held by each such person in any Acquired Entity
other than those listed in Schedule 1.4.

              (j) Assignment of Intellectual Property. The individuals listed on
Schedule 7.2(j) shall have entered into an intellectual property assignment
agreement with E3 whereby all of his rights, title and interest in and to the E3
Intellectual Property or E3 Products is assigned, conveyed and transferred to
E3.

              (k) Indebtedness. At Closing, First Union National Bank shall be
prepared to deliver UCC-3 financing statements or other appropriate instruments
or documents necessary to terminate or effect the termination of any and all
Liens (including, but not limited to, any Liens on E3 Intellectual Property and
any and all equity interests in any Subsidiary of E3) that it holds with respect
to the Bank Debt if such Bank Debt is fully satisfied at Closing. At Closing,
First Union National Bank shall deliver the original copies of any and all term
notes or revolving credit notes provided under the Loan Agreement to JDA for
cancellation if such bank debt is fully satisfied at Closing. If JDA has
determined in its sole discretion that it is necessary, First Union National
Bank shall have taken any and all necessary and appropriate actions to assign,
transfer or convey any and all rights, title and interests in and to the E3
Foreign Subsidiary Notes at the Closing.

              (l) 401(k) Plan. At the Closing, JDA shall have received
satisfactory evidence, pursuant to Section 6.7 above, that the E3 401(k) plan
shall have been terminated effective as of the day immediately preceding the
Closing Date.

              (m) Termination of E3 Stock Option Plan. Prior to the Closing, E3
shall have terminated the E3 Stock Option Plan and shall have canceled all stock
options outstanding under such plan or otherwise.

              (n) Non-competition and Non-solicitation Agreement. On or prior to
the Closing Date, the Non-competition and Non-solicitation Agreement, in the
form of Exhibit J attached hereto, shall have been executed by JDA and each of
the Indemnifying Shareholders.

         Section 7.3 Additional Conditions to Obligations of E3. The obligation
of E3 to effect the Merger is subject to the satisfaction of each of the
following conditions, any of which may be waived, in writing, exclusively by E3:


                                       44
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              (a) Representations and Warranties. The representations and
warranties of JDA and Sub set forth in this Agreement shall be true and correct
as of the date of this Agreement and as of the Closing Date as though made on
and as of the Closing Date, except (i) for changes contemplated by this
Agreement, (ii) that representations and warranties which specifically relate to
a particular date or period shall be true and correct as of such date or for
such period, and (iii) where the failure of any such representation or warranty
to be true and correct on and as of the Closing Date, individually or in the
aggregate, would not be reasonably likely to have a Material Adverse Effect on
JDA, or a material adverse effect upon the consummation of the transactions
contemplated hereby; and E3 shall have received a certificate to such effect
signed on behalf of JDA by the chief financial officer of JDA. For the purposes
of the foregoing condition, the following events or occurrences shall not be
deemed to be events or occurrences having a Material Adverse Effect on JDA: (i)
reductions or increases in the trading price of JDA Common Stock, as reported on
the NASDAQ, occurring at any time or from time to time between the date hereof
and the Closing Date; (ii) events or occurrences affecting the general economy
or the industries or segments of the industries in which JDA or E3 do business,
generally; or (iii) events or occurrences related directly to the Merger or the
other transactions contemplated by this Agreement.

              (b) Performance of Obligations. JDA and Sub shall have performed
in all material respects all obligations required to be performed by them under
this Agreement at or prior to the Closing Date, and E3 shall have received a
certificate to such effect signed on behalf of JDA by the chief financial
officer of JDA.

              (c) Approvals. E3 shall have received from JDA and Sub written
evidence that the execution, delivery and performance of JDA's and Sub's
obligations under this Agreement have been duly and validly approved and
authorized by the Boards of Directors of JDA and Sub.

              (d) Opinion of JDA Counsel. E3 shall have received a legal opinion
from Gray Cary Ware & Freidenrich LLP, counsel to JDA, substantially in the form
of Exhibit K attached hereto.

              (e) Escrow Agreement. The Escrow Agreement shall have been
executed and delivered by JDA and the Escrow Agent.

              (f) Registration Rights Agreement. The Registration Rights
Agreement, substantially in the form of Exhibit L attached hereto, shall have
been executed and delivered by JDA and the Shareholders.

              (g) Indebtedness. At Closing, First Union National Bank shall be
prepared to deliver UCC-3 financing statements or other appropriate instruments
or documents necessary to terminate or effect the termination of any and all
Liens (including, but not limited to, any Liens on E3 Intellectual Property and
any and all equity interests in any Subsidiary of E3) that it holds with respect
to the Bank Debt if such Bank Debt is fully satisfied at Closing. At Closing,
First Union National Bank shall deliver the original copies of any and all term
notes or revolving credit notes provided under the Loan Agreement to JDA for
cancellation if such Bank Debt is fully satisfied at Closing. If JDA has
determined in its sole discretion that it is necessary, First


                                       45
   50
Union National Bank shall have taken any and all necessary and appropriate
actions to assign, transfer or convey any and all rights, title and interests in
and to the E3 Foreign Subsidiary Notes at the Closing.

              (h) Medical Benefits Agreements. Concurrently herewith the Medical
Benefits Agreements in the form attached as Exhibit H hereto shall have been
executed by JDA and each of Anders Herlitz, Frank Schuster and William Huther,
to be effective as of the Closing. As of the Closing, all of such agreements
shall be in full force and effect in accordance with their terms.

                                  ARTICLE VIII

                            TERMINATION AND AMENDMENT

                             [INTENTIONALLY DELETED]


                                   ARTICLE IX

                                 INDEMNIFICATION

         Section 9.1 Survival of Representations and Warranties and Covenants.
If the Merger occurs, all of the representations and warranties contained in
this Agreement shall survive the Closing Date and shall continue in full force
and effect for the period ending on the date that is one (1) year following the
Closing Date, whereupon they will terminate and expire, except that and the
representations and warranties of the Shareholders in Article IIIA shall survive
forever. This Section 9.1 shall not limit any covenant or agreement of the
parties hereto which by its terms contemplate performance after the Effective
Time. The foregoing notwithstanding, all representations and warranties shall be
deemed to be true and correct only as of the date of this Agreement except for
those representations and warranties that specifically relate to a particular
date or period, which shall be deemed to be true and correct as of such date and
for such period.

         Section 9.2 Indemnification by Shareholders.

              (a) Subject to the terms and conditions contained herein, each of
the Shareholders shall indemnify, defend and hold harmless the JDA Group from,
against, for and in respect of any and all losses, damages, costs and expenses
(including reasonable legal fees and expenses) which any member of the JDA Group
may sustain or incur which are caused by or arise out of (i) any inaccuracy in
or breach of any of the representations, warranties or covenants made by E3 or
the Signing Shareholders in this Agreement, including the E3 Disclosure
Schedule, (ii) any E3 Transaction Expenses in excess of the amount set forth on
the Closing E3 Transaction Expense Schedule and reflected in the calculation of
the Cash Merger Consideration, (iii) any breach by the Shareholders of this
Article IX or the Escrow Agreement, or (iv) any of the matters set forth in the
Indemnification Schedule attached as Exhibit M hereto, to the extent therein set
forth (collectively, "JDA LOSSES").

              (b) No Shareholder shall be required to indemnify any member of
the JDA Group for any JDA Losses until the aggregate amount of all JDA Losses
under all claims shall exceed the Floor Amount; provided, however, that JDA
Losses under Section 3.7,


                                       46
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Section 9.2(a)(ii) and JDA Losses identified on Exhibit M as Non-Floor Losses
shall be recoverable in full without regard to the Floor Amount. Once the
aggregate amount of all JDA Losses under all claims exceeds the Floor Amount,
all JDA Losses in excess of the first $200,000 initially included in the Floor
Amount shall be recoverable in full.

              (c) The provisions of Sections 9.2(b) above and 9.6 below shall
not limit, in any manner, (i) any remedy at Law or in equity to which any member
of the JDA Group shall be entitled against E3 or any Shareholder as a result of
willful fraud or intentional misrepresentation by E3, any Shareholder or any of
their respective representatives, or (ii) any rights that JDA may have under
federal or state securities Laws.

              (d) The amount of JDA Losses shall be computed after giving effect
to the receipt of any insurance proceeds with respect thereto.

         Section 9.3 Procedures for Indemnification.

              (a) An Indemnification Claim shall be made by Indemnitee by
delivery of a written notice to the Shareholders' Representative and the Escrow
Agent requesting indemnification and specifying in reasonable detail the basis
on which indemnification is sought (and shall include relevant documentation
related to the Indemnification Claim), the amount of the asserted JDA Losses
and, in the case of a Third Party Claim, containing (by attachment or otherwise)
such other information as Indemnitee shall have concerning such Third Party
Claim.

              (b) If the Indemnification Claim involves a Third Party Claim, the
procedures set forth in Section 9.4 hereof shall be observed by Indemnitee and
the Shareholders' Representative.

         Section 9.4 Defense of Third Party Claims. Should any claim be made, or
suit or proceeding (including, without limitation, a binding arbitration or an
audit by any taxing authority) be instituted against an Indemnitee which, if
prosecuted successfully, would be a matter for which Indemnitee is entitled to
indemnification under this Agreement, the obligations and liabilities of the
parties hereunder with respect to such Third Party Claim shall be subject to the
following terms and conditions:

              (a) Indemnitee shall give the Shareholders' Representative and
Escrow Agent written notice of any Third Party Claim promptly after receipt by
Indemnitee of notice thereof. The Shareholders' Representative may, at his
option, (i) undertake control of the defense thereof by counsel of its own
choosing reasonably acceptable to Indemnitee or (ii) decline to assume control
of but participate in the defense thereof provided that such participation by
the Shareholders' Representative shall be at the expense of the Indemnitors.
Indemnitee may participate in the defense through its own counsel at its own
expense. The assumption of the defense of any Third Party Claim by Shareholders'
Representative shall not be an acknowledgment by Shareholders' Representative
that such Third Party Claim is subject to indemnification under the provisions
of this Article IX and that such provisions are binding on the Shareholders. If,
however, Shareholders' Representative fails or refuses to undertake the defense
of such Third Party Claim within fifteen (15) days after written notice of such
claim has been delivered to Shareholders' Representative by Indemnitee,
Indemnitee shall have the right to


                                       47
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undertake the defense, compromise and, subject to Section 9.5 hereof, settlement
of such Third Party Claim with counsel of its own choosing. In the circumstances
described in the preceding sentence, Indemnitee shall, promptly upon its
assumption of the defense of such Third Party Claim, make an Indemnification
Claim which shall be deemed an Indemnification Claim that is not a Third Party
Claim for the purposes of the procedures set forth herein. Failure of Indemnitee
to furnish written notice to the Shareholders' Representative of a Third Party
Claim shall not release the Shareholders' Representative or the Indemnitors from
their obligations hereunder, except to the extent the Indemnitors are prejudiced
by such failure.

              (b) Indemnitee and the Shareholders' Representative shall
cooperate with each other in all reasonable respects in connection with the
defense of any Third Party Claim, including making available records relating to
such claim and furnishing employees of Indemnitee as may be reasonably necessary
for the preparation of the defense of any such Third Party Claim or for
testimony as witness in any proceeding relating to such claim.

              (c) Notwithstanding anything else in this Section 9.4 to the
contrary, in the event of a Third Party Claim that is reasonably estimated to
exceed fifty percent (50%) of the total Merger Consideration, valued as of the
Closing Date, in the case of a claim related to Section 3.9 and $5 million, in
the case of any other claim, Indemnitee shall have the option to undertake
control of the defense by counsel of Indemnitee's choosing reasonably acceptable
to the Shareholders' Representative. In this circumstance, Indemnitee shall,
promptly upon its assumption of the defense of such Third Party Claim, make an
Indemnification Claim which shall be deemed an Indemnification Claim, but shall
not be subject to Indemnitor's right to assume the defense of such claim
pursuant to Section 9.4.

         Section 9.5 Settlement of Third Party Claims. No settlement by
Indemnitee of a Third Party Claim shall be made without the prior written
consent by or on behalf of the Shareholders' Representative, which consent shall
not be unreasonably withheld or delayed. If the Shareholders' Representative has
assumed the defense of a Third Party Claim as contemplated by Section 9.4
hereof, no settlement of such Third Party Claim may be made by the Shareholders'
Representative without the prior written consent by or on behalf of Indemnitee,
which consent shall not be unreasonably withheld or delayed. In the event of any
dispute regarding the reasonableness of a proposed settlement, the party that
will bear the larger financial loss resulting from such settlement shall make
the final determination in respect thereto, which determination shall be final
and binding on all involved parties. For the purposes of this Section 9.5, a
proposed settlement involving E3 or JDA intellectual property rights shall be
deemed reasonable only if such settlement includes a royalty-free license or
right to exploit the intellectual property rights in question; provided,
however, that such license or right shall not be necessary if the intellectual
property rights are immaterial to the use, development or sale of E3 Products.

         Section 9.6 Manner of Indemnification; Excess Indemnification by
Indemnifying Shareholders.

              (a) Except as specifically set forth in this Article IX, the
Escrowed Consideration deposited into Escrow pursuant to the Escrow Agreement in
accordance with the provisions of Section 2.5, shall provide the sole and
exclusive fund against which members of


                                       48
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the JDA Group may assert claims of indemnification under this Article IX. Any
payout of Escrowed Consideration to an Indemnitee (the "ESCROW PAYMENT") shall
consist of Escrowed Shares and Escrowed Cash in the same ratio as the Stock
Merger Consideration and Cash Merger Consideration bear to the total Merger
Consideration as of Closing; provided, however, that the Shareholders'
Representative shall have the right at any commercially reasonable time prior to
payment of a claim by the Escrow Agent to adjust the composition of the Escrow
Payment in his sole discretion by delivery of written notice to JDA and the
Escrow Agent of such adjustment. For the purpose of valuing the Escrowed Shares
to be paid to an Indemnitee, the value of JDA Common Stock shall be the average
of the per share closing prices of JDA Common Stock on the NASDAQ on the last
ten trading days prior to such payment of that Indemnitee.

              (b) Each claim for indemnification asserted against the
Shareholders pursuant to this Article IX shall be made only in accordance with
the procedures set forth in the Escrow Agreement, subject to the provisions of
Section 9.2(c) hereof.

              (c) Except as specifically provided in this subsection and in
Section 9.2(c), the rights of the JDA Group under the provisions of this Article
IX shall be the exclusive remedy of the JDA Group for any inaccuracy in or
breach of the representations, warranties or covenants of E3 and the
Shareholders in this Agreement and for any JDA Losses. In the event of a breach
of a representation or warranty contained in Section 3.9, and only in the event,
that any JDA Loss for such breach exceeds the amount of the Escrowed
Consideration remaining in the Escrow (such comparison to be made and such
Escrowed Consideration to be valued for purposes of this subsection as of the
date of delivery of the notice of Indemnification Claim described in Section
9.3(a)), then the Indemnifying Shareholders shall be obligated, jointly and
severally and in addition to such Shareholders other indemnification obligations
under this Article IX, to indemnify, defend and hold harmless the JDA Group
from, against, for and in respect of such excess amount up to and including the
Excess Indemnification Liability Cap; provided, however, that notwithstanding
the Indemnifying Shareholders' joint and several liability hereunder, JDA shall
use commercially reasonable efforts to pursue such indemnification claims on a
pro rata basis against all the Indemnifying Shareholders. Such obligations shall
be discharged pursuant to the procedures and manner of indemnification set forth
in this Article IX (including without limitation the role and authority of the
Shareholders' Representative set forth in Section 9.7). Notwithstanding the
foregoing, the liability of the Indemnifying Shareholders as a group, jointly
and not severally, under this subsection shall not exceed the Excess
Indemnification Liability Cap.

         Section 9.7 Appointment of Shareholders' Representative. For purposes
of this Agreement, the Shareholders hereby consent to the appointment of Anders
Herlitz as the representative and attorney-in-fact for and on behalf of the
Shareholders, and to the taking by the Shareholders' Representative of any and
all actions and the making of any decisions required or permitted to be taken by
him under this Agreement or the Escrow Agreement, including, without limitation,
the exercise of the power to (i) execute the Escrow Agreement on behalf of the
Shareholders, (ii) authorize delivery to JDA of Escrow Shares in satisfaction of
Indemnification Claims, (iii) agree to, negotiate, enter into settlements and
compromises of and comply with orders of courts and awards of arbitrators with
respect to such Indemnification Claims, (iv) resolve any Indemnification Claims
and (v) take all actions necessary in the judgment of the Shareholders'
Representative for the accomplishment of the foregoing and all of the other
terms,


                                       49
   54
conditions and limitations of this Agreement and the Escrow Agreement.
Accordingly, the Shareholders' Representative has unlimited authority and power
to act on behalf of each Shareholder with respect to this Agreement and the
Escrow Agreement and the disposition, settlement or other handling of all
Indemnification Claims, rights or obligations arising from and taken pursuant to
this Agreement. The Shareholders will be bound by all actions taken by the
Shareholders' Representative in connection with this Agreement, and JDA shall be
entitled to rely on any action or decision of the Shareholders' Representative.
The Shareholders' Representative will incur no liability with respect to any
action taken or suffered by him in reliance upon any notice, direction,
instruction, Consent, statement or other document believed by him to be genuine
and to have been signed by the proper person (and shall have no responsibility
to determine the authenticity thereof), nor for any other action or inaction,
except his own willful misconduct or bad faith. At any time during the term of
the Escrow Agreement, holders of a majority of the Escrow Shares subject to
Indemnification Claims under this Article IX may, by written consent, appoint a
new representative as the Shareholders' Representative by sending notice and a
copy of the written consent appointing such new representative signed by holders
of a majority of the Escrow Shares to JDA and the Escrow Agent. Such appointment
will be effective upon the later of the date indicated in the Consent or the
date such Consent is received by JDA and the Escrow Agent.

         Section 9.8 Indemnification of Shareholders' Representative. The
Shareholders shall, severally and not jointly, on a pro rata basis based on
their proportionate share of the Merger Consideration, indemnify , defend and
hold the Shareholders' Representative harmless from and against any loss,
damage, tax, liability and expense that may be incurred by the Shareholders'
Representative arising out of or in connection with the acceptance or
administration of the Shareholders' Representative's duties, including the
defense of any Third Party Claim, except as caused by the Shareholders'
Representative's proven gross negligence or willful misconduct (as determined in
light of all the circumstances, including the time and facilities available to
him in the ordinary course of business), including legal costs and expenses of
defending such Shareholders' Representative against any claim or liability in
connection with the performance of the Shareholders' Representative's duties.
The Shareholders' Representative shall be entitled to, but not limited to, such
indemnification from the Escrowed Consideration (net of any amounts due, owed or
distributed to JDA) that are distributed to the Shareholders upon termination of
the escrow.

         Section 9.9 Post Closing Indemnification. If a claim is bought after
the Closing against any person who was an officer or director of E3 as of the
date of this Agreement, and that claim is based upon such person's status as an
officer, director, Employee or agent of the E3, or any of the E3 Subsidiaries,
prior to the Closing, and that person would have been entitled to
indemnification against such claim under the provisions of E3's Articles of
Incorporation in effect as of September 6, 2001, then the Surviving Corporation
shall indemnify such person to the same extent as that person would have been
entitled to under the provisions of E3's Articles of Incorporation in effect as
of September 6, 2001.


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                                   ARTICLE X

                               GENERAL PROVISIONS

         Section 10.1 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given when received if delivered
personally or by commercial delivery service (with signature acknowledging
receipt), or sent via facsimile (with confirmation of receipt), or within
seventy-two (72) hours after being mailed by registered or certified mail
(return receipt requested), in each case, to the parties at the following
addresses (or at such other address for a party as shall be specified by like
notice):

              (a)  if to JDA, to:

                        JDA Software, Group, Inc.
                        14400 N. 87th Street
                        Scottsdale, Arizona 85260-3649
                        Attention:  James D. Armstrong
                        Fax: (480) 308-4265
                        Tel: (480) 308-3014

                        with a copy to:

                        JDA Software, Group, Inc.
                        14400 N. 87th Street
                        Scottsdale, Arizona 85260-3649
                        Attention:  Michael Bridge, Esq.
                        Fax: (480) 308-4268
                        Tel: (480) 308-3460

                        with a copy to:

                        Gray Cary Ware & Freidenrich LLP
                        1221 South MoPac Expressway, Suite 400
                        Austin, Texas 78746-6875
                        Attention: Paul E. Hurdlow, Esq.
                        Fax: (512) 457-7020
                        Tel: (512) 457-7001

              (b)  if to E3, to

                        E3 Corporation
                        1800 Parkway Place, Suite 600
                        Marietta, Georgia 30067
                        Attention: Anders Herlitz
                        Fax: (770) 421-6600
                        Tel: (770) 424-0100


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                        with a copy to:

                        Morris, Manning & Martin, LLP
                        1600 Atlanta Financial Center
                        3343 Peachtree Road, NE
                        Atlanta, Georgia 30326
                        Attention:  Grant W. Collingsworth, Esq.
                        Fax: (404) 365-9532
                        Tel: (404) 233-7000

              (c)  if to a Signing Shareholder, to the appropriate address set
                   forth upon Exhibit A.

         Section 10.2 Interpretation.

              (a)  For purposes of this Agreement

                   (i)  When reference is made to an Article or Section, such
reference shall be to an Article or Section of this Agreement unless otherwise
indicated; and

                   (ii) The table of contents and headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

              (b)  This Agreement has been negotiated by the respective parties
hereto and their attorneys and the language hereof shall not be construed for or
against any party.

         Section 10.3 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original as against any
party whose signature appears on such counterpart and all of which shall be
considered one and the same agreement and shall become effective when one or
more counterparts have been signed by each of the parties and delivered to the
other parties, it being understood that all parties need not sign the same
counterpart.

         Section 10.4 Severability. In the event that any provision of this
Agreement, or the application thereof, becomes or is declared by a court of
competent jurisdiction to be illegal, void or unenforceable, the remainder of
this Agreement will continue in full force and effect and the application of
such provision to other persons or circumstances will be interpreted so as
reasonably to effect the intent of the parties hereto. The parties further agree
to replace such void or unenforceable provision of this Agreement with a valid
and enforceable provision that will achieve, to the extent possible, the
economic, business and other purposes of such void or unenforceable provision.

         Section 10.5 Entire Agreement. This Agreement (including the schedules
and exhibits hereto and the other documents delivered pursuant hereto)
constitutes the entire agreement among the parties concerning the subject matter
hereof and supersedes all prior agreements and


                                       52
   57
understandings, both written and oral, among the parties with respect to the
subject matter hereof, other than the Confidentiality Agreement.

         Section 10.6 Governing Law. This Agreement shall be governed and
construed in accordance with the Laws of the State of Delaware without regard to
the Laws that might otherwise govern under any applicable conflicts of Law
principles thereof.

         Section 10.7 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto (whether by operation of Law or otherwise) without the prior written
consent of the other parties. Subject to the preceding sentence, this Agreement
will be binding upon, inure to the benefit of and be enforceable by the parties
and their respective successors and assigns.

         Section 10.8 Third Party Beneficiaries. Nothing contained in this
Agreement is intended to confer upon any person other than the parties hereto
and their respective successors and permitted assigns, any rights, remedies or
obligations under, or by reason of this Agreement, except that (i) the persons
who are Shareholders immediately prior to the Effective Time (and their
successors and assigns) are express intended third party beneficiaries of
Articles I, II and IV and Article IX, and (ii) each of the foregoing persons is
an express intended third party beneficiary of Article X, to the extent relevant
to any of the foregoing, and as such are entitled to rely on the provisions
hereof as if a party hereto.

         Section 10.9 Release.

              (a) Subject only to the provisions of Section 10.9(b) and the
limitations set forth in the last sentence of this Section 10.9(a) and
notwithstanding any other provision of this Agreement, each Signing Shareholder
hereby unconditionally and irrevocably releases and forever discharges,
effective as of and forever after the Effective Time, to the fullest extent
permitted by applicable Law, the Released Parties from any and all debts,
liabilities, obligations, claims, demands, actions or causes of action, suits,
judgments or controversies of any kind whatsoever (collectively,
"PRE-ACQUISITION CLAIMS") against E3, or Sub solely in its capacity as successor
to E3, if any, or any of them that arises out of or is based on any agreement or
understanding or act or failure to act (including any act or failure to act that
constitutes ordinary or gross negligence or reckless or willful, wanton
misconduct), misrepresentation, omission, transaction, fact, event or other
matter occurring prior to the Effective Time (whether based on any governmental
requirement or right of action, at Law or in equity or otherwise, foreseen or
unforeseen, matured or unmatured, known or unknown, accrued or not accrued)
(collectively, "PRE-ACQUISITION MATTERS"), including without limitation: (i)
claims by the Signing Shareholder with respect to repayment of loans or
indebtedness; (ii) any rights, titles and interests in, to or under any
agreements, arrangements or understandings to which the Signing Shareholder is a
party; and (iii) claims by the Signing Shareholder with respect to dividends,
violation of preemptive rights, or payment of salaries or other compensation or
in any way arising out of or in connection with the Signing Shareholder's
employment with E3 or any E3 Subsidiary, the cessation of that employment, the
Signing Shareholder's status as an officer, director or shareholder of E3 or E3
Subsidiary or otherwise (subject to Section 9.7 and excluding any and all claims
in respect of accrued and unpaid amounts owing to the Shareholder as salary or
wages at the rates or in the amounts, as the case may be, set forth in the E3
Disclosure Schedule);


                                       53
   58
provided, however, that the Pre-Acquisition Claims shall not include any debts,
liabilities, obligations, claims, demands, actions or causes of actions, suits,
judgments or controversies of any kind whatsoever that arise out of or are based
on the negotiation or execution of this Agreement or the other Transaction
Documents, or the consummation of the Merger or other transactions contemplated
by this Agreement or the other Transaction Documents or any other actions by E3
taken in connection with or in contemplation of the transactions contemplated by
this Agreement or the other Transaction Documents. The Signing Shareholder
further agrees not to file or bring any litigation before any governmental
entity on the basis of or respecting any Pre-Acquisition Claim concerning any
Pre-Acquisition Matter against any Released Party. Each Signing Shareholder (i)
acknowledges that he fully comprehends and understands all the terms of this
Section 10.9(a) and their legal effects and (ii) expressly represents and
warrants that (A) he is competent to effect the release made in this Section
10.9 knowingly and voluntarily and without reliance on any statement or
representation of any Released Party or its representatives and (B) he had the
opportunity to consult with an attorney of his choice regarding this Section
10.9(a). This Section 10.9(a) will not affect the rights of the Signing
Shareholders under the Agreement or any other Transaction Document.

         Section 10.10 Gender. Pronouns in masculine, feminine and neuter
genders shall be construed to include any other gender, and words in the
singular form shall be construed to include the plural and vice versa, unless
the context otherwise requires.

                  [REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]




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         IN WITNESS WHEREOF, JDA, Sub and E3 have caused this Agreement to be
signed by their respective officers thereunto duly authorized, and the Signing
Shareholders have signed this Agreement, as of the date first written above.


JDA SOFTWARE GROUP, INC.,
a Delaware corporation


By:___________________________
Name:_________________________
Title:________________________
   60
E3 CORPORATION,
a Georgia corporation


By:___________________________
Name:_________________________
Title:________________________
   61
E3 ACQUISITION CORP.,
a Delaware corporation


By:___________________________
Name:_________________________
Title:________________________
   62
SIGNING SHAREHOLDERS




______________________________
Anders H. Herlitz



______________________________
Christina R. Herlitz



______________________________
Carl H. Herlitz



______________________________
Jan W. Herlitz



______________________________
Frank K. Schuster



______________________________
William H. Huther



______________________________
Daniel J. Craddock
   63
                                    EXHIBIT A

                         LIST OF E3 SIGNING SHAREHOLDERS


Anders H. Herlitz
1010 Seminole Dr.
Apt. 1705
Ft. Lauderdale, Florida 33304


Christina R. Herlitz
1010 Seminole Dr.
Apt. 1705
Ft. Lauderdale, Florida 33304


Carl H. Herlitz
125 Old Blaisdell Road
Sutton, NH 03273


Jan W. Herlitz
1010 Seminole Dr.
Apt. 1705
Ft. Lauderdale, Florida 33304


Frank K. Schuster
9610 Club South Circle, #4110
Sarasota, Florida 34238


William H. Huther
11291 Long Water Chase Ct.
Gulf Harbour Y&CL
Ft. Myers, Florida 33908-4952


Daniel J. Craddock
1208 Fenmore Hall
Powder Springs, Georgia 30127
   64
                                    EXHIBIT B

                                ESCROW AGREEMENT
   65
                                    EXHIBIT C

                               JULY BALANCE SHEET
   66
                                    EXHIBIT D

                               MARCH BALANCE SHEET
   67
                                    EXHIBIT E

                            SHAREHOLDER'S CERTIFICATE
   68
                                    EXHIBIT F

                               E3 TAX CERTIFICATE
   69
                                    EXHIBIT G

                               JDA TAX CERTIFICATE
   70
                                    EXHIBIT H

                           MEDICAL BENEFITS AGREEMENT
   71
                                    EXHIBIT I

                    OPINION OF MORRIS, MANNING & MARTIN, LLP
   72
                                    EXHIBIT J

                 NON-COMPETITION AND NON-SOLICITATION AGREEMENT
   73
                                    EXHIBIT K

                   OPINION OF GRAY CARY WARE & FREIDENRICH LLP
   74
                                    EXHIBIT L

                          REGISTRATION RIGHTS AGREEMENT
   75
                                    EXHIBIT M

                            INDEMNIFICATION SCHEDULE

1.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from, related to or attributable to, and to the
extent based upon, the failure to include in a Customer License Agreement with a
customer based in the United States both a contractual exclusion of liability
for consequential damages and a limitation of aggregate damages provision
limiting E3's exposure to such damages at least to the extent such exposure
would be limited by the following language:

         E3'S TOTAL LIABILITY FOR TORT, CONTRACT AND OTHER DAMAGES (EXCEPT FOR
         AND SUBJECT TO SECTION 1(A) OF THIS SECTION TWO) SHALL NOT EXCEED THE
         LICENSE FEE PAID BY LICENSEE FOR THE PARTICULAR SOFTWARE PROGRAM GIVING
         RISE TO THE CLAIM FOR, OR ALLEGEDLY CAUSING THE, DAMAGES.
         NOTWITHSTANDING ANYTHING TO THE CONTRARY, IN NO EVENT SHALL E3 BE
         LIABLE FOR LOST PROFITS OR OTHER INCIDENTAL OR CONSEQUENTIAL, INDIRECT,
         SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES UNDER ANY CIRCUMSTANCES
         WHATSOEVER.

Indemnification Claims based upon this Item 1 shall be subject in all respects
to the procedures and limitations set forth in Article IX, including without
limitation the Floor Amount set forth in Section 9.2(b).

2.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to any claim by Frank Schuster that
he is entitled to severance payments or other compensation associated with
termination of his employment in excess of accrued salary and benefits and
severance benefits equal to six months of base salary. Indemnification Claims
based upon this Item 2 shall be subject in all respects to the procedures and
limitations set forth in Article IX and shall be a Non-Floor Loss.

3.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to any claim by Jose Alarcon that he
is contractually entitled to severance or other similar payments solely as a
result of the Merger or any change in the Board of Directors in connection with
the Merger. Indemnification Claims based upon this Item 3 shall be subject in
all respects to the procedures and limitations set forth in Article IX and shall
be a Non-Floor Loss.

4.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to any claim by Peter Kornafel that
he is entitled to equity securities of E3 or JDA as a result of or prior to the
Merger. Indemnification Claims based upon this Item 4 shall be subject in all
respects to the procedures and limitations set forth in Article IX and shall be
a Non-Floor Loss.
   76
5.       Any payments of sales taxes (including related penalties and interest,
if any) to sales tax authorities by JDA following the Closing Date relating to
the matters described in Schedule 3.5, Schedule 3.6(j), and Schedule 3.7 of the
E3 Disclosure Schedules less (i) the amount reserved for such payments on the
July Balance Sheet and (ii) all such sales tax payments (including related
penalties and interest, if any) that JDA is reasonably able to collect from
customers of E3 following the Closing Date. Indemnification Claims based upon
this Item 5 shall be subject in all respects to the procedures and limitations
set forth in Article IX, including without limitation the Floor Amount set forth
in Section 9.2(b).

6.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to E3's improper treatment of any
employee as an "exempt" employee under the Fair Labor Standards Act.
Indemnification Claims based upon this Item 6 shall be subject in all respects
to the procedures and limitations set forth in Article IX, including without
limitation the Floor Amount set forth in Section 9.2(b).

7.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to the loss of trade secret
protection as a result of the failure of the following persons to have signed
confidentiality agreements in favor of E3:

Ryan Brothers                 Christopher Kang            Michael Pecora
Randy Byars                   Nam Su Kang                 Wayne Rabstejnek
Wen Chen                      Bagyalakshmi Kathireson     Terrence Rice
Rod England                   Steve Keinath               Sicily Richardson
Brett Harris                  Christopher Loder           Dennis Roper
King Harrison                 Roger Mahler                Joe Shenefield
Debbie Horton-Rice            Dale Moldenhauer            Jonathan Yergin
Saraj Kanduri                 Ken Palmer
Scott Jacobs                  JeffWitte
Igor Alvarez                  Dana Lovell                 Dawn Smith
Heather Boothe                Debbie McCullough           Rainer Stein
Andrew Calzon                 Marvin McGill               I. Stevens
Julia Cox                     Thomas Merandi, II          Kim Stevenson
C. De Gasquet                 Erin Miller                 Vaheeduddin Syed
C. Dubois                     R. Moreno                   Steve Thomas
Stuart Dunkin                 ME Nygaard                  F. Ventrone
Stephanie Grammont            L. Ohlsson                  Hugo Villafan
B. Gryding                    Thomas Ollivier             M. Virtanen
Carl James                    F. Parrot                   Therese Viscelli
R. Johanson                   O. Pedersen                 Willy Weie
Jennifer Johnson              S. Place                    Lee Windsor
Tommy Johnson                 Edgar Ramirez               Robert Zierler
Y. Kunte                      Jennifer Reed
Patrick Liefooghe             Jane Roberts
W. Lovatt                     Lucy Savidge
   77
Indemnification Claims based upon this Item 7 shall be subject in all respects
to the procedures and limitations set forth in Article IX, including without
limitation the Floor Amount set forth in Section 9.2(b).

8.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to unpaid Taxes claimed by the
relevant taxation authority as a result of the audits identified in Schedule
3.7(f) of the E3 Disclosure Schedules and in the subsequent disclosure in the
same schedule regarding Germany and France. Indemnification Claims based upon
this Item 8 shall be subject in all respects to the procedures and limitation
set forth in Article IX and shall be a Non-Floor Loss.

9.       Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to the pending litigation with the
French tax authorities disclosed in Schedule 3.18 of the E3 Disclosure Schedules
under the caption "France." Indemnification Claims based upon this Item 9 shall
be subject in all respects to the procedures and limitations set forth in
Article IX , including without limitation the Floor Amount set forth in Section
9.2(b).

10.      Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to the pending litigation with M. Le
Peniec disclosed in Schedules 3.12 and 3.18 of the E3 Disclosure Schedules.
Indemnification Claims based upon this Item 10 shall be subject in all respects
to the procedures and limitations set forth in Article IX, including without
limitation the Floor Amount set forth in Section 9.2(b).

11.      Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to the disclosure in Schedule 3.17(c)
of the E3 Disclosure Schedules regarding overtime payments potentially due to
certain employees in Finland. Indemnification Claims based upon this Item 11
shall be subject in all respects to the procedures and limitations set forth in
Article IX, including without limitation the Floor Amount set forth in Section
9.2(b).

12.      Any losses, damages, costs and expenses (including reasonable legal
fees and expenses) arising from or related to the disclosure in Schedule 3.9 of
the E3 Disclosure Schedules regarding the lack of confidentiality or
intellectual property ownership/assignment provisions in certain contracts with
employees in Australia and Finland. Indemnification claims based upon this Item
12 shall be subject in all respects to the procedures and limitations set forth
in Article IX, including without limitation the Floor Amount set forth in
Section 9.2(b).

EX-4.1

   1

                                                                     EXHIBIT 4.1



                            JDA SOFTWARE GROUP, INC.

                          REGISTRATION RIGHTS AGREEMENT


                                SEPTEMBER 7, 2001
   2
                          REGISTRATION RIGHTS AGREEMENT

      THIS REGISTRATION RIGHTS AGREEMENT is entered into as of September 7, 2001
(this "AGREEMENT"), by and among JDA Software Group, Inc., a Delaware
corporation (the "JDA"), and the holders of JDA's Common Stock (the "HOLDERS")
listed on Exhibit A attached hereto.

                                 R E C I T A L S

      WHEREAS, the Holders are receiving shares of Common Stock pursuant to the
Agreement and Plan of Reorganization dated September 7, 2001 (the "MERGER
AGREEMENT"), by and among JDA, E3 Acquisition Corp., E3 and certain stockholders
of E3.

      WHEREAS, JDA has agreed to enter into this Agreement with the Holders as a
condition to closing of the Merger Agreement.

      NOW, THEREFORE, in consideration of the mutual promises contained herein,
and other consideration, the receipt and sufficiency of which hereby is
acknowledged, the parties hereto agree as follows:

      1.    CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:

            1.1.  "COMMON STOCK" shall mean the Common Stock, $0.01 par value,
of JDA.

            1.2.  "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the SEC promulgated thereunder, all
as the same shall be in effect at that time.

            1.3.  "INITIATING HOLDERS" means the Holders who, in the case of the
demand registration under Section 4, are the holders of more than fifty percent
(50%) of the Registrable Securities.

            1.4.  "PIGGYBACK RIGHTS" means those rights provided to the Holders
pursuant to Section 3.1 of this Agreement.

            1.5.  The terms "REGISTER", "REGISTERED" and "REGISTRATION" refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act (as defined below), and the declaration or
ordering of the effectiveness of such registration statement.

            1.6.  "REGISTRABLE SECURITIES" means the 1,600,085 shares of Common
Stock received by the Holders pursuant to the Merger Agreement; provided,
however, that the Common Stock shall only be treated as Registrable Securities
if and for 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, (B) sold in a transaction exempt from the registration and
prospectus delivery requirements of the Securities Act under Section 4(1)
thereof so that all transfer
   3
restrictions and restrictive legends with respect thereto are removed upon the
consummation of such sale, or (C) transferred in a transaction whereby the
registration rights granted herein are not assigned.

            1.7.  "REGISTRATION EXPENSES" shall mean all expenses (excluding
underwriting discounts and selling commissions and any costs or expenses of any
counsel retained by Holders) incurred in connection with a registration under
Sections 3 and 4 hereof, including, without limitation, all registration and
filing fees, printing expenses, fees and disbursements of counsel for JDA, and
blue sky fees and expenses.

            1.8.  "SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, and the rules and regulations of the SEC promulgated thereunder, all as
the same shall be in effect at the time.

            1.9.  "SEC" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.

      2.    RESTRICTIVE LEGEND. Each certificate representing Registrable
Securities shall (unless otherwise permitted or unless the securities evidenced
by such certificate shall have been registered under the Securities Act) be
stamped or otherwise imprinted with a legend substantially 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,
      AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS. SUCH SHARES MAY NOT
      BE SOLD OR OFFERED FOR SALE IN THE ABSENCE OF SUCH REGISTRATION OR AN
      OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH
      REGISTRATION IS NOT REQUIRED UNDER THE 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 COMPANY AT THE PRINCIPAL
      EXECUTIVE OFFICE OF THE COMPANY.

            Upon request of a holder of such a certificate, JDA shall remove the
foregoing legend from the certificate or issue to such holder a new certificate
therefor free of any transfer legend, if, with such request, JDA shall have
received either (i) a written opinion of legal counsel to the holder who shall
be reasonably satisfactory to JDA, addressed to JDA and reasonably satisfactory
in form and substance to JDA's counsel, to the effect that the proposed transfer
of the Registrable Securities may be effected without registration under the
Securities Act and that future transfers will not require such registration or
(ii) a "no-action" letter from the SEC to the effect that the distribution of
such securities and any subsequent transfer without registration will not result
in a recommendation by the staff of the SEC that action be taken with respect
thereto, unless any such transfer legend may be removed (a) for routine sales
under Rule 144,


                                       2
   4
(b) pursuant to Rule 144(k), and (c) for distributions by partnerships and
limited liability companies, in which case no such legal opinion or "no-action"
letter shall be required.

      3.    PIGGYBACK REGISTRATION.

            3.1.  If, at any time prior to the termination of the rights under
this Agreement, JDA shall determine to register any of its securities either for
its own account or for the account of a security holder or holders exercising
their respective demand registration rights, other than a registration relating
solely to employee benefit plans or a registration relating solely to a SEC Rule
145 transaction or a registration on any registration form which does not permit
secondary sales or does not include substantially the same information as would
be required to be included in a registration statement covering the sale of
Registrable Securities, JDA will:

                  (a)   promptly give to each Holder written notice thereof; and

                  (b)   include in such registration, and in any underwriting
involved therein, all of the Registrable Securities specified in a written
request or requests made by any Holder within fifteen (15) days after receipt of
the written notice from JDA described in clause (a) above, except as set forth
in Section 3.2 below. Such written request may specify all or a part of a
holder's Registrable Securities.

            3.2.  Underwriting. If the registration for which JDA gives notice
is for a registered public offering involving an underwriting, JDA shall so
advise the Holders as a part of the written notice given pursuant to Section
3.1. In such event the right of any Holder to registration pursuant to Section 3
shall be conditioned upon such Holder's participation in such underwriting and
the inclusion of such Holder's Registrable Securities in the underwriting to the
extent provided herein. All Holders proposing to distribute their securities
through such underwriting shall (together with JDA and the other stockholders
distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with a nationally recognized
underwriter selected for underwriting by JDA (the "UNDERWRITER").
Notwithstanding any other provision of this Section 3, if the Underwriter
determines that marketing factors require a limitation on the number of shares
to be underwritten, the Underwriter may (subject to the allocation priority set
forth below) exclude from such registration and underwriting all or a portion of
the Registrable Securities. JDA shall so advise all holders of securities
requesting registration, and the number of shares of securities that are
entitled to be included in the registration and underwriting by persons other
than JDA shall be allocated in the following priority: first, among all Holders
in proportion, as nearly as practicable, to the respective amounts of securities
which they had requested to be included in such registration at the time of
filing the registration statement, and second, among persons not contractually
entitled to registration rights under this Agreement. If any Holder disapproves
of the terms of any such underwriting, such Holder may elect to withdraw
therefrom by written notice to JDA and the Underwriter. Any Registrable
Securities excluded or withdrawn from such underwriting shall be withdrawn from
such registration.



                                       3
   5
      4.    DEMAND REGISTRATION.

            4.1.  Request for Registration. If JDA shall receive from the
Initiating Holders, at any time following expiration of the three (3) month
period immediately following the date of this Agreement, a written request that
JDA effect a registration of the Registrable Securities, JDA will:

                  (a)   within fifteen (15) days of receipt thereof, give
written notice of the proposed registration to all other Holders (a "DEMAND
NOTICE"); and

                  (b)   as soon as practicable, use its best efforts to effect
such registration on Form S-3 (including, without limitation, the execution of
an undertaking to file post effective amendments, appropriate qualification
under applicable blue sky or other state securities laws and appropriate
compliance with applicable regulations issued under the Securities Act) as may
be so requested and as would permit or facilitate the sale and distribution of a
portion of the Registrable Securities as are specified by the Initiating Holders
in such request and by any Holders joining in such request in a written request
delivered to JDA within twenty (20) days after the date of the Demand Notice;
provided, however, that JDA shall not be required to register more than fifty
percent (50%) of the total number of Registrable Securities. If the number of
Registrable Securities requested to be registered exceeds fifty percent (50%) of
the total number of Registrable Securities, then the number of shares of
Registrable Securities each Holder is entitled to register shall be determined
pro-rata based upon such Holder's ownership of Registrable Securities. In any
event, JDA shall not be obligated to effect, or to take any action to effect,
any such registration pursuant to this Section 4:

                        (i)   In any particular jurisdiction in which JDA would
be required to execute a general consent to service of process in effecting such
registration, qualification or compliance, unless JDA is already subject to
service in such jurisdiction and except as may be required by the Securities
Act;

                        (ii)  If JDA has effected a prior registration pursuant
to this Section 4.1 and such registration has been declared or ordered effective
and the sale of such Registrable Securities has closed;

                        (iii) If JDA has effected a prior effective registration
within one hundred eighty (180) days of the Initiating Holder's request (other
than a registration effected solely to qualify an employee benefit plan or to
effect a business combination pursuant to Rule 145); or

                        (iv)  If the registration requested would have an
aggregate disposition price (after deduction of underwriting discounts and
expenses of sale) of less than $500,000.

            Subject to the foregoing clauses (i), (ii), (iii) and (iv), JDA
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 and joining Holders; provided, however,
that if JDA shall furnish to such Initiating Holders and joining Holders a
certificate signed by the President or CEO of JDA stating that in the good faith
judgment of the Board of


                                       4
   6
Directors of JDA, it would be significantly detrimental to JDA and its
stockholders for such registration statement to be filed on or before the time
filing would be required and it is therefore essential to defer the filing of
such registration statement, JDA shall have the right to defer such filing for a
period of not more than ninety (90) days after receipt of the request of the
Initiating Holders and joining Holders. JDA shall file such registration
statement on Form S-3 to the extent that JDA is eligible to use Form S-3 for
such registration.

      5.    EXPENSES OF REGISTRATION; REGISTRATION PROCEDURE.

            5.1.  Expenses of Registration. JDA shall pay all Registration
Expenses incurred in connection with any demand registration on Form S-3
pursuant to Section 4 and all Piggyback Registrations pursuant to Section 3,
provided, however, that JDA shall not be required to pay any Registration
Expenses if, as a result of the withdrawal of a request for registration by
Initiating Holders, the registration statement does not become effective, unless
such withdrawal is caused by a material adverse change in the business or
operations of JDA and such material adverse change was not known to the
Initiating Holders at the time of the request, or unless the Initiating Holders
agree to have such registration considered a registration for the purposes of
Section 4.1(b)(ii). If JDA is not required to pay any Registration Expenses,
then the Holders seeking to participate in such registration shall bear such
Registration Expenses pro rata on the basis of the number of their shares
included in the registration request, and such registration shall not be
considered a registration for purposes of Section 4.1(b)(ii).

            5.2.  Registration Procedure. In the case of each registration
effected by JDA pursuant to Sections 3 or 4, JDA will keep each Holder advised
in writing as to the initiation of each registration and as to the completion
thereof. At its expense, JDA will:

                  (a)   Maintain and keep such registration effective or current
for a period of one hundred eighty (180) days or until the Holders have
completed the distribution described in the registration statement relating
thereto, whichever first occurs; provided, however, that (i) such one hundred
eighty (180) day period shall be extended for a period of time equal to the
period the Holders refrain from selling any securities included in such
registration at the request of an underwriter of Common Stock (or other
securities) of JDA; and (ii) in the case of any registration of Registrable
Securities on Form S-3 which are intended to be offered on a continuous or
delayed basis, such one hundred eighty (180) day period shall be extended, if
necessary, to keep the registration statement effective until all such
Registrable Securities are sold, however, in no event longer than one (1) year
from the effective date of the registration statement and provided that Rule
145, or any successor rule under the Securities Act governing the obligation to
file a post-effective amendment permit, in lieu of filing a post-effective
amendment that (I) includes any prospectus required by Section 10(a)(3) of the
Securities Act or (II) reflects facts or events representing a material or
fundamental change in the information set forth in the registration statement,
the incorporation by reference of information required to be included in (I) or
(II) above to be contained in periodic reports filed pursuant to Section 13 or
15(d) of the Exchange Act in the registration statement;

                  (b)   Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectuses used in
connection with such registration


                                       5
   7
statement as may be necessary to comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
registration statement;

                  (c)   Furnish such number of prospectuses and other documents
incident thereto, including any amendment of or supplement to the prospectus, as
a Holder from time to time may reasonably request;

                  (d)   Notify such seller of Registrable Securities covered by
such registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or incomplete in the light of the
circumstances then existing, and at the request of any such seller, prepare and
furnish to such seller a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall not include 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 not misleading or
incomplete in light of the circumstances then existing;

                  (e)   Cause all such Registrable Securities registered
pursuant hereunder to be listed on each securities exchange on which similar
securities issued by JDA are then listed;

                  (f)   Provide a transfer agent and registrar for all
Registrable Securities registered pursuant to such registration statement and a
CUSIP number for all such Registrable Securities, in each case not later than
the effective date of such registration; and

                  (g)   Use its commercially reasonable efforts to take all
other steps necessary or appropriate to effect the registration of the
Registrable Securities contemplated hereby.

      6.    INDEMNIFICATION.

            6.1.  To the extent permitted by law, JDA will indemnify each
Holder, if Registrable Securities held by such Holder are included in the
securities with respect to which registration, qualification or compliance has
been effected pursuant to this Agreement, and each underwriter, if any, and each
person who controls any underwriter 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 prospectus, offering
circular or other document (including any related registration statement)
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 JDA
of the Securities Act including any rule or regulation thereunder applicable to
JDA relating to action or inaction required of JDA in connection with any such
registration, qualification or compliance, and will reimburse each such Holder,
each of its officers, directors and partners, and each person controlling such
Holder, each


                                       6
   8
such underwriter and each person who controls any such underwriter, for any
legal and any other expenses reasonably incurred in connection with
investigating and defending any such claim, loss, damage, liability or action,
provided that JDA 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 alleged untrue statement) or omission (or alleged omission)
based upon information furnished to JDA specifically for inclusion therein by
such Holder, each of its officers, directors and partners, and each person
controlling such Holder or underwriter and each person who controls any such.

            6.2.  Each Holder will, if Registrable Securities or other
securities held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify JDA, each
of its directors, officers and agents and each underwriter, if any, of JDA's
securities covered by such a registration statement, each person who controls
JDA or such underwriter within the meaning of Section 15 of the Securities Act,
each other such Holder and each of their officers, directors and partners, 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, in light of the circumstances in
which they were made, not misleading, and will reimburse JDA and such Holders,
directors, officers, agents, partners, 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 information furnished to JDA specifically
for inclusion therein by such Holder. In no event shall the aggregate liability
of a Holder for indemnification under this Section 6 exceed the gross proceeds
received by such Holder from the sale of shares in such offering.

            6.3.  Each party entitled to indemnification under this Section 6
(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 any litigation resulting
therefrom, 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 Agreement, except to the extent
that the Indemnified Party is prejudiced thereby. Each Indemnified Party shall
furnish such information regarding itself or the claim in question as an
Indemnifying Party may reasonably request and as shall be reasonably required in
connection with defense of such claim and litigation resulting therefrom. An
Indemnified Party shall have the right to retain its own counsel, with the fees
and expenses to be paid by the Indemnifying Party, if representation of such
Indemnified Party by the counsel retained by the Indemnifying Party would be


                                       7
   9
inappropriate due to actual or potential conflicts of interest between such
Indemnified Party and any other party represented by such counsel in such
proceeding, provided that in no event shall the Indemnifying Party be required
to pay the fees and expenses of more than one such separate counsel for all
Indemnified Parties.

            6.4.  If the indemnification provided for in this Section 6 is held
by a court of competent jurisdiction to be unavailable to an Indemnified Party
with respect to any losses, claims, damages or liabilities referred to herein,
the Indemnifying Party, in lieu of indemnifying such Indemnified Party
thereunder, shall to the extent permitted by applicable law contribute to the
amount paid or payable by such Indemnified Party as the result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party on the one hand and of the Indemnified
Party on the other in connection with the allegation(s) that resulted in such
loss, claim, damage or liability, as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by a court of law by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties' relevant intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission; provided, that in no event shall any contribution by a
Holder hereunder exceed the gross proceeds from the sale of shares in the
offering received by such Holder.

            6.5.  The obligations of JDA and Holders under this Section 6 shall
survive the completion of any offering of Registrable Securities in a
registration statement and the termination of this Agreement. No Indemnifying
Party, in the defense of any such claim or litigation, shall, except with the
prior written consent of each Indemnified Party (which consent shall not be
unreasonably withheld), consent to the entry of any judgment or enter into any
settlement. Unless waived by the Indemnified Party, all judgments and
settlements must 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.

      7.    RULE 144 REPORTING. With a view to making available the benefits of
certain rules and regulations of the SEC which may permit the sale of the
Registrable Securities to the public without registration, JDA agrees to:

            7.1.  Make and keep public information available as those terms are
understood and defined in Rule 144 under the Securities Act;

            7.2.  Use its best efforts to file with the SEC in a timely manner
all reports and other documents required of JDA under the Securities Act and the
Exchange Act.

            7.3.  So long as a Holder owns any restricted securities under Rule
144, furnish to the Holder forthwith upon request a written statement by JDA as
to its compliance with the reporting requirements of Rule 144, and of the
Securities Act and the Exchange Act.

      8.    LOCKUP AGREEMENT. In consideration for JDA's obligations under this
Agreement, each Holder of Registrable Securities and each transferee pursuant to
Section 10.1


                                       8
   10
hereof agrees, in connection with any registration of JDA's securities with
respect to which the Holders are permitted to include at least fifty percent
(50%) of the Registrable Securities requested to be registered by the Holders,
upon request of JDA or the underwriters managing any underwritten offering of
JDA's securities, that he, she or it shall not, directly or indirectly, sell,
offer to sell (including, without limitation, any short sale), grant any option
to purchase or otherwise transfer or dispose of (other than to donees who agree
to be similarly bound) any Registrable Securities (other than those included in
the registration) without the prior written consent of JDA or such underwriters,
as the case may be, for up to one hundred twenty (120) days from the effective
date of such registration; provided, however, that all persons entitled to
registration rights with respect to shares of Common Stock who are not parties
to this Agreement, all other persons selling shares of Common Stock in such
offering, and all executive officers and directors of the Company shall also
have agreed not to sell publicly their Common Stock under the circumstances and
pursuant to the terms substantially equivalent to those requested of the Holders
pursuant to this Section 8. Each Holder agrees that JDA may instruct its
transfer agent to place stop transfer notations in its records to enforce the
provisions of this Section 8.

      9.    TERMINATION OF RIGHTS. Unless otherwise provided herein, the rights
and provisions of this Agreement shall terminate upon the earlier to occur of
(i) such time as any Holder is able to sell all of his, her or its Registrable
Securities in any ninety (90) day period pursuant to Rule 144 promulgated under
the Securities Act without regard to volume limitations; and (ii) two (2) years
from the date of this Agreement.

      10.   MISCELLANEOUS.

            10.1. Transfer or Assignment of Registration Rights. The rights to
cause JDA to register the Holder's securities granted by JDA under Sections 3
and 4 hereof may be transferred or assigned by the Holder to a transferee or
assignee of any of the Registrable Securities, provided that JDA is given
written notice by such Holder at the time of said transfer or assignment,
stating the name and address of said transferee or assignee and identifying the
securities with respect to which such registration rights are being transferred
or assigned; and provided further that (i) such transferee is a constituent,
partner, affiliate, member, family member of transferor, or a trust or
subsidiary controlled by the transferor, (ii) after giving effect to such
transfer, the transferee holds at least 150,000 shares of Registrable Securities
(appropriately adjusted for recapitalizations, stock combinations, stock splits,
dividends and the like), or (iii) the transferee acquires the Registrable
Securities for no consideration or by gift or devise; and provided further that
the transferee or assignee of such rights is not deemed by the Board of
Directors of JDA, in its reasonable judgment, to be a competitor of JDA; and
provided further that the transferee or assignee of such rights assumes the
obligations of a Holder under this Agreement and, without any further action of
the parties hereto, becomes a Holder under this Agreement.

            10.2. Governing Law. This Agreement shall be governed by and
construed under the laws of the State of Delaware as applied to agreements
entered into solely between residents of and to be performed entirely within
such state.



                                       9
   11
            10.3. Counterparts; Facsimiles. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument. Facsimile copies of
this Agreement shall be deemed originals in all respects.

            10.4. Titles and Subtitles. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.

            10.5. Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given when received if delivered personally or
by commercial delivery service (with signature acknowledging receipt), or sent
via facsimile (with confirmation of receipt), or within seventy-two (72) hours
after being mailed by registered or certified mail (return receipt requested),
in each case, to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):

                  (a)   if to JDA, to:

                        JDA Software Group, Inc.
                        14400 N. 87th Street
                        Scottsdale, Arizona 85260-3649
                        Attention:  James D. Armstrong
                        Fax:  (480) 308-4265
                        Tel:  (480) 308-3014

                        with a copy to:

                        JDA Software Group, Inc.
                        14400 N. 87th Street
                        Scottsdale, Arizona 85260-3649
                        Attention:  Michael Bridge, Esq.
                        Fax:  (480) 308-4268
                        Tel:  (480) 308-3460

                        with a copy to:

                        Gray Cary Ware & Freidenrich LLP
                        1221 South MoPac Expressway, Suite 400
                        Austin, Texas 78746-6875
                        Attention: Paul E. Hurdlow, Esq.
                        Fax:  (512) 457-7020
                        Tel:  (512) 457-7001

                  (b)   if to Holders, to the addresses listed on Exhibit A.

            10.6. Expenses. If any action at law or in equity (including
arbitration) is necessary to enforce or interpret the terms of this Agreement,
the prevailing party shall be


                                       10
   12
entitled to reasonable attorneys' fees, expenses and necessary disbursements in
addition to any other relief to which such party may be entitled.

            10.7. Amendments and Waivers. Any term of this Agreement may be
amended with the written consent of the Board of Directors of JDA and the
Holders of at least a majority of the then outstanding Registrable Securities.
Any amendment or waiver effected in accordance with this Section 10.7 shall be
binding upon the Holders, each transferee of the Registrable Securities, each
future holder of all such Registrable Securities, and JDA.

            10.8. Severability. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, portions of such provisions, or
such provisions in their entirety, to the extent necessary, shall be severed
from this Agreement, and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.

            10.9. Delays or Omissions. No delay or omission to exercise any
right, power or remedy accruing to any party to this Agreement, upon any breach
or default of the other party, shall impair any such right, power or remedy of
such non-breaching party nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence therein, or of any similar breach or
default thereafter occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any party of any breach or default under this
Agreement, or any waiver on the part of any party of any provisions or
conditions of this Agreement, must be made in writing and shall be effective
only to the extent specifically set forth in such writing. All remedies, either
under this Agreement, or by law or otherwise afforded to any Holder, shall be
cumulative and not alternative.

            10.10. Entire Agreement. This Agreement and the documents referred
to herein constitute the entire agreement between the parties hereto pertaining
to the subject matter hereof and any other written or oral agreements between
the parties hereto are expressly canceled.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]






                                       11
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         IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement of the day and year first above written.

                                        COMPANY:

                                        JDA SOFTWARE GROUP, INC.,
                                        a Delaware corporation


                                        By:
                                            ------------------------------------
                                        Name:
                                              ----------------------------------
                                        Title:
                                               ---------------------------------
                                        Address:
                                                 -------------------------------

                                                 -------------------------------

                                                                           (Fax)
                                                 --------------------------







                 SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT
   14
                                        HOLDERS:



                                        ----------------------------------------

                                        Printed Name:
                                                      --------------------------






                 SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT
   15
                                    EXHIBIT A

                                     HOLDERS


Anders H. Herlitz
1010 Seminole Dr.
Apt. 1705
Ft. Lauderdale, Florida 33304

Christina R. Herlitz
1010 Seminole Dr.
Apt. 1705
Ft. Lauderdale, Florida 33304

Carl H. Herlitz
125 Old Blaisdell Road
Sutton, NH 03273

Jan W. Herlitz
1010 Seminole Dr.
Apt. 1705
Ft. Lauderdale, Florida 33304

Frank K. Schuster
9610 Club South Circle, #4110
Sarasota, Florida 34238

William H. Huther
11291 Long Water Chase Ct.
Gulf Harbour Y&CL
Ft. Myers, Florida 33908-4952

Daniel J. Craddock
1208 Fenmore Hall
Powder Springs, Georgia 30127

Kenneth Axelsson
240 Galsworthy Court
Roswell, GA  30075

Bjorn Uttergard
Hagvagen 7
185 32 Vaxholm
Sweden
   16
Ove Andre
TSV  36
S-18134 Lidingo
Sweden

Fitz-Lennart Egnell
Varlavagen 92
S-11522 Stockholm
Sweden

Bjorn Valsinger
6 Loxton Place
Forestville N.S.W. 2087
Australia

EX-99.1

   1
                                                                    EXHIBIT 99.1


JDA SOFTWARE GROUP, INC.                             INVESTOR RELATIONS CONTACT:
NEWS RELEASE                             Lawrence Delaney, Jr., The Berlin Group
                                PH: (310) 577-5282; Email: larry@berlingroup.com

                                                   JDA PUBLIC RELATIONS CONTACT:
                           Maureen N. Tuskai, Director, Corporate Communications
                            Phone: (480) 308-3233; Email: maureen.tuskai@jda.com
--------------------------------------------------------------------------------

JDA SOFTWARE ACQUIRES E3, WORLD'S LEADING PROVIDER OF INVENTORY OPTIMIZATION
SOLUTIONS
Acquisition Extends JDA's Reach up the Supply Chain with Integrated CPFR
Software

SCOTTSDALE, ARIZ. - SEPTEMBER 10, 2001 - JDA(R) SOFTWARE GROUP, INC. (Nasdaq:
JDAS) announced today the acquisition of E3 CORPORATION, the global leader of
inventory optimization systems. Founded in 1980, privately held E3 has helped
over 550 retailers, wholesalers, distributors and manufacturers in 20 countries
to maximize their inventory decisions with computer assisted ordering and
replenishment systems. With this acquisition, JDA has once again executed upon
its proven strategy to broaden its JDA Portfolio(TM) with complementary products
such as industry frontrunner, E3TRIM(TM) replenishment system, and E3's new
Collaborative, Planning, Forecasting and Replenishment (CPFR) solutions.

      "In our drive to reach the $500 million mark, we will continue to build or
acquire solutions that offer unlimited growth potential," commented JDA CEO JIM
ARMSTRONG. "By acquiring a market leader such as E3, we have immediately gained
the highest level of market share in the inventory replenishment space.
Importantly, with approximately half of E3's clients being non-retail, we will
accelerate our CPFR initiative by gaining presence in the wholesale and
distribution industries, which we had already targeted for growth."

      Added Armstrong, "With 32 offices in 17 countries servicing clients in
over 60 nations, JDA's global sales and delivery infrastructure is perfectly
suited to acquisitions of this nature. Starting today we will leverage our
capabilities to position E3 with the remainder of our 4,000 plus clients and
unlimited prospects."

      Commenting on the acquisition, ANDERS H. HERLITZ, E3'S FOUNDER AND
CHAIRMAN, said, "JDA has been our partner and our competitor for many years, and
we have been mutually successful on both counts. With the match between our
offerings being nearly perfect, it made sense for us to work together to benefit
our clients. Our total solution has vast potential for improving customer ROI.
Of even greater importance is the fact that we are now a single company offering
a single product portfolio to an enlarged marketplace."

ACQUISITION TERMS

      JDA acquired E3 for $20 million dollars in cash and 1.6 million shares of
JDA Common Stock for a purchase price of approximately $50 million dollars. E3's
revenues for the 12 months ending June 30, 2001 were $44.3 million including
$21.1 million of software and $13.1 million in maintenance. JDA will incur a
one-time charge of $2.2 million for in-process research and development costs
and the related tax benefit in third quarter 2001. Excluding this charge, JDA
expects the E3 acquisition to be neutral to earnings in third quarter and
solidly accretive in future quarters. The Company also expects to spend an
additional $10 to $12 million for merger-related costs and to take advantage of
operating synergies, which will bring the total cost
   2
Add 1
JDA Acquires E3



of the acquisition to approximately $60 million. Banc of America Securities LLC
acted as financial advisor to JDA. First Union Securities acted as financial
advisor to E3 Corporation.

JDA TO TARGET UNIX MARKET WITH NEXT GENERATION E3TRIM

      A key factor influencing JDA's acquisition was E3's readiness to launch
UNIX versions of its leading E3TRIM replenishment product.

      "Since approximately 110 of our clients are also E3 users, we have a real
appreciation for this solution's power and have long viewed E3 as the best brand
in forecast-based replenishment," commented JDA PRESIDENT, HAMISH BREWER. "The
imminent availability of the UNIX version gives us a much broader opportunity
base and strongly supports our tier one growth strategy."

      Affirming that E3 has set the standard for inventory replenishment, PETER
CHARNESS, JDA'S SENIOR VICE PRESIDENT, MARKETING AND CHIEF PRODUCT OFFICER,
said, "E3's next generation replenishment solutions are based on over 20 years
of deep intellectual capital as well as proven best practices in computer
assisted ordering. No other competitive product comes close to the depth of
functionality that these applications deliver. With E3 now part of JDA
Portfolio, we are confident that E3TRIM will assume the same leadership position
in the UNIX-market as the solution has already achieved with its current
customers."

JDA TO DELIVER PREVAILING RESPONSE TO CPFR INITIATIVE

      JDA is also optimistic about the opportunities that will result by merging
its CPFR efforts with E3's initiatives, including an existing Application
Service Provider (ASP) delivery model for its solutions. With the vision of
enabling manufacturers, distributors, and retailers to work from a single,
shared demand forecast, E3 will now be able to hasten and enhance its progress
as part of JDA.

      Commented JDA's Brewer, "We are very excited about the impressive strides
that E3 has made driving collaborative replenishment solutions between retailers
and their suppliers. The industry is focused on this and AMR Research has even
pinpointed replenishment as the most sought after solution in the collaborative
field. While plenty of vendors are talking about it, E3 has actually been doing
it for years."

      E3's CPFR solutions include more than 50 live trading partners
collaborating via E3 solutions -- an unparalleled number which includes four of
the top five hardware co-ops either utilizing established programs or in the
process of implementing systems.

      KEVIN STADLER, JDA'S SENIOR VICE PRESIDENT OF COLLABORATIVE SOLUTIONS,
confirmed that E3's progress supports JDA's strategy of emphasizing forecasting
and replenishment as key customer focused areas that link the demand chain with
the supply chain.

      "We'll gain an immediate kick-start in this important strategic growth
area," explained Stadler. "With E3 serving as a cornerstone of our CPFR
offering, we will provide the total solution that tightens production cycles,
lowers safety stock requirements and reduces potential lost sales. When you
combine Arthur
   3
Add 2
JDA Acquires E3



Planning(TM), Intactix(TM) assortment and space management applications, JDA
Intellect(TM) advanced data mining applications and the E3 products, it's clear
that no other vendor in the market can come close to offering the business
benefit that JDA is able to deliver."

CONFERENCE CALL INFORMATION

      JDA will host a conference call today at 9:15 a.m. Eastern to discuss its
acquisition of E3. The following telephone numbers can be used for anyone
interested in participating: (800) 450-0785 (United States) or (612) 332-0530
(International) and ask the operator for the "JDA Discussion." A replay of the
conference call will begin today at 11:45 a.m. Eastern and end on September 24
at 11:59 p.m. Eastern. Interested parties can hear the recall by dialing (800)
475-6701 (United States) or (320) 365-3844 (International) using Access Code
602666.

      Additionally, interested parties can hear the conference call over the
Internet through Vcall. To listen, callers must log onto the Vcall web site,
http://www.vcall.com, by 9:00 a.m. Eastern to register, download and install any
necessary audio software. For those who cannot listen to the live broadcast, a
replay will be available on Vcall shortly after the call and a transcript will
be posted to Vcall's web site 24 to 48 hours after the call.

      A Frequently Asked Questions document is available at http://www.jda.com
under "News & Events" for more information.

ABOUT JDA SOFTWARE GROUP

      With more than 4,300 retail, wholesale, distribution and manufacturing
clients in 60 countries, JDA Software Group, Inc. (NASDAQ:JDAS) is the global
leader in providing integrated software and professional services that address
real-world issues to help multi-channel companies manage their mission critical
operations. By capitalizing on its market position and financial strength, JDA
commits significant resources in furthering its next generation of retail
intelligent solutions that exploit the power of the Internet to meet emerging
business needs. Founded in 1985, JDA is headquartered in Scottsdale, Arizona and
employs more than 1,400 associates operating from 32 offices in major cities
throughout North America, South America, Europe, Asia and Australia. For more
information, visit www.jda.com.

                                       ###

This press release contains forward-looking statements that are made in reliance
upon the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements include: our strategy of broadening JDA
Portfolio by building or acquiring solutions that we hope will enable us to
reach $500 million in annual revenue; Mr. Armstrong's statement that we have
gained the highest level of market share in the inventory replenishment space
and the implication that we can maintain and leverage this market share; Mr.
Armstrong's statement that we will accelerate our CPFR initiative by gaining
presence in wholesale and distribution; Mr. Armstrong's statement that our
global sales and delivery infrastructure is perfectly suited to acquisitions of
this nature; Mr. Armstrong's statement that we will position E3 with our clients
and prospects; our expectation that the
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JDA Acquires E3



E3 acquisition will be neutral to earnings in the third quarter, and solidly
accretive in future quarters; our expectation that we will need to spend an
additional $10 to $12 million for merger-related costs, and that we will be able
to take advantage of operating synergies; Mr. Brewer's statement that we believe
the UNIX version of E3TRIM is imminently available, and that it will strongly
support out tier one growth strategy; Mr. Charness' statement that E3TRIM will
assume the same leadership position in the UNIX-market as it has with its
current customers; Mr. Stadler's statements regarding our ability to combine our
and E3's CPFR efforts to kick-start CPFR as an important strategic growth area
for us. Future events may involve risks and uncertainties, including, but not
limited to, uncertainties related to our ability to: successfully assimilate
into JDA both the E3 products and services, and the E3 employees to help us
achieve our $500 million annual revenue goal; our ability to maintain and
enhance E3's market-leading position in the inventory replenishment space,
particularly since many of E3's customers are wholesalers and distributors, who
are not part of our traditional retail market; successfully use our existing
sales and delivery infrastructure to integrate E3's products, services,
employees and products, particularly since E3's office locations, products,
customers and markets are different than ours; successfully back-sell E3
products into our client base; achieve neutral earnings with E3 in the third
quarter and solidly accretive in future quarters, particularly given the
uncertain global economy; keep merger-related costs to $10 to $12 million and
achieve operating synergies, particularly given the complexity of combining two
global companies; complete the development of the new UNIX version of E3TRIM in
a timely, cost-efficient and technically viable manner, and to integrate this
new version with our other products, particularly our UNIX-based merchandise
system, ODBMS; leverage the E3 acquisition to further our efforts to enter the
CPFR market; and other risks detailed from time to time in the "Risk Factors"
section of our filings with the Securities and Exchange Commission. As a result
of these and other risks, actual results may differ materially from those
predicted. We undertake no obligation to update information in this release.

In addition to the specific risks identified in the proceeding paragraph,
acquisitions involve a number of special risks, including diversion of
management's attention to the assimilation of the operations and personnel of
acquired businesses, costs related to the acquisition and the integration of
acquired businesses, products, technologies and employees into our business and
product offerings. Achieving the anticipated benefits of any acquisition will
depend, in part, upon whether the integration of the acquired business,
products, technology, or employees is accomplished in an efficient and effective
manner, and there can be no assurance that this will occur. The difficulties of
such integration may be increased by the necessity of coordinating
geographically disparate organizations, the complexity of the technologies being
integrated, and the necessity of integrating personnel with disparate business
backgrounds and combining different corporate cultures. The inability of
management to successfully integrate any acquisition we may pursue, and any
related diversion of management's attention, could have a material adverse
effect on our business, operating results and financial condition. Moreover,
there can be no assurance that any products acquired will gain acceptance in our
markets, that we will be able to penetrate new markets successfully or that we
will obtain the anticipated or desired benefits of such acquisitions. Any
acquisition we pursue or consummate could result our incurring debt and
contingent liabilities, amortization of goodwill and other intangibles,
purchased research and development expense, other acquisition-related expenses
and the loss of key employees, any of which items could have a material adverse
effect on our business, operating results and financial condition.

JDA is a registered trademark with the United States Patent and Trademark
Office. E3TRIM, JDA Arthur Planning, JDA Intellect and JDA Portfolio are
trademarks of JDA Software Group, Inc. All other company, product or services
names referenced in this release may be registered trademarks or trademarks of
their respective owners.