10-K

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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-K
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   [X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934

           FOR THE FISCAL YEAR ENDED DECEMBER 31, 2003

                                  OR

   [ ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
           SECURITIES EXCHANGE ACT OF 1934

           FOR THE TRANSITION PERIOD FROM           TO



                         COMMISSION FILE NUMBER 0-27876
                            JDA SOFTWARE GROUP, INC.
             (Exact name of registrant as specified in its charter)

                                            
                   DELAWARE                                      86-0787377
       (State or other jurisdiction of                        (I.R.S. Employer
        incorporation or organization)                      Identification No.)
                                   14400 NORTH 87TH STREET
                                  SCOTTSDALE, ARIZONA 85260
                (Address of principal executive offices, including zip code)



              REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE:
                                 (480) 308-3000
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          SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
                                      NONE

          SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                         COMMON STOCK, $0.01 PAR VALUE

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.  Yes [X]     No [ ]

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.

     Indicate by check mark whether the registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2).  Yes [X]     No [ ]

     The approximate aggregate market value of the registrant's common stock
held by non-affiliates of the registrant (based on the closing sales price of
such stock as reported by the NASDAQ Stock Market) on June 30, 2003 was
$300,433,967. Excludes shares of common stock held by directors, officers and
each person who holds 5% or more of the registrant's common stock. Number of
shares of common stock, $0.01 par value per share, outstanding as of March 5,
2004 was 29,040,595.

                      DOCUMENTS INCORPORATED BY REFERENCE



                DOCUMENTS                             FORM 10-K REFERENCE
                ---------                             -------------------
                                        
 Portions of the Proxy Statement for the    Items 10, 11, 12, 13 and 14 of Part III
    registrant's 2004 Annual Meeting of
     Stockholders are incorporated by
   reference into Part III of this Form
                   10-K


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     This Annual Report on Form 10-K contains forward-looking statements
reflecting management's current forecast of certain aspects of our future. It is
based on current information that we have assessed but which by its nature is
dynamic and subject to rapid and even abrupt changes. Forward looking statements
include statements regarding future operating results, liquidity, capital
expenditures, product development and enhancements, numbers of personnel,
strategic relationships with third parties, and strategy. The forward-looking
statements are generally accompanied by words such as "plan," "estimate,"
"expect," "intend," "believe," "should," "would," "could," "anticipate" or other
words that convey uncertainty of future events or outcomes. Our actual results
could differ materially from those stated or implied by our forward-looking
statements due to risks and uncertainties associated with our business. These
risks are described throughout this Annual Report on Form 10-K, which you should
read carefully. We would particularly refer you to the section under the heading
"Factors That May Affect Our Future Results or the Market Price of Our Stock"
for an extended discussion of the risks confronting our business. The
forward-looking statements in this Annual Report on Form 10-K should be
considered in the context of these risk factors.

                                     PART I

ITEM 1. BUSINESS

OVERVIEW

     We are a leading provider of sophisticated software solutions designed
specifically to address the demand and supply chain management, business
process, decision support, e-commerce, inventory optimization, and collaborative
planning and forecasting requirements of the retail industry and suppliers to
the retail industry. Our solutions enable customers to manage and optimize their
inventory flows throughout the demand chain to the consumer, and provide
optimized labor scheduling for retail store operations. Our customers include
approximately 4,500 of the world's leading retail, consumer package goods
("CPG") manufacturers and wholesalers. We believe we have the largest retail
customer installed base among our direct competitors, with more than 1,200
retail customers in over 60 countries and nearly 3,300 CPG manufacturers and
wholesalers. Our customers include many of the world's leading retail, CPG
manufacturing and wholesale organizations including AEON Company Ltd.,
Anheuser-Busch Companies, Carrefour, Colgate-Palmolive, CVS Pharmacy, Inc.,
Dollar General Corporation, Energizer Holdings, Inc., The Estee Lauder
Companies, Inc., H. E. Butt Grocery Company, The Kroger Company, The Limited,
Meijer Stores, Michaels Stores, Sodimac, Tesco and Wal-Mart. Our software
solutions business is enhanced and supported by our retail and supplier specific
professional services.

     We market our JDA Portfolio software solutions to approximately 3,200
retailers worldwide with annual sales of $100 million or more. More than 1,200
of these potential retail customers own at least one of our products. Our
acquisitions of the Arthur Retail Business Unit ("Arthur"), Intactix
International, Inc. ("Intactix"), E3 Corporation ("E3") and Vista Software
Solutions, Inc. ("Vista"), have enabled us to expand our client base to include
nearly 3,300 suppliers to the retail industry and added software applications
that enable business-to-business collaborative planning, forecasting and
replenishment ("CPFR") between retailers and their suppliers. These
acquisitions, together with the investments we've made over the past few years
to increase the scalability of our products, have enabled us to pursue emerging
growth opportunities in the demand chain and further expand our target markets
to include larger multi-national retail organizations and approximately 26,000
suppliers to the retail industry worldwide with annual sales of $100 million or
more.

MARKET BACKGROUND

     Retail organizations and their suppliers are facing intensifying
competition, fluctuating demand, evolving retail channels and increasing
globalization. Sales are pressured, margins are compressed through intensified
competition and almost all companies are trying to achieve improved results with
fewer people. As a result, retail organizations seek technology solutions to
better manage their increasingly complex businesses, improve their operating
efficiencies and financial performance, and strengthen their relationships with
customers and suppliers.

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     Companies in the retail market we serve have specific technology
requirements to support and optimize their operations. General enterprise
resource planning ("ERP") solution providers have been unable to fully meet the
demands of these organizations. Although our retail and wholesale customers have
typically invested a low proportion of their total revenues in technology, as
the leaders in this industry begin to demonstrate an ability to achieve market
advantage through effective use of specialized applications, the requirement for
all retailers to increase their investment in technology and adopt best
practices has grown. Many of these companies have not yet replaced their
customized legacy systems with packaged software solutions, and as result, there
is substantial opportunity in our targeted retail market. In addition, many of
the companies in our targeted retail market do not utilize sophisticated
optimization solutions.

     The CPG manufacturing customers we serve employ solutions from JDA to
optimize their ability to sell to consumers through the retail channel. While
most of these companies have historically invested heavily in manufacturing
systems from other providers, the technology support for their sales operations
is generally limited. JDA is developing a new solutions market with these
companies, focused on optimizing sales of consumer products to end consumers
through collaborative solutions that allow the CPG manufacturer and the retailer
to improve inventory assortment and availability at the point of sale.

JDA SOLUTIONS

     We are the leading provider of comprehensive, integrated software solutions
specifically designed for the retail industry and its suppliers. We have
developed and marketed our Retail Enterprise Systems and In-Store Systems to
retailers for over 19 years, and our installed base of more than 1,200 retail
customers is comprised of many of the world's leading retail organizations. In
addition, our Collaborative Solutions have been installed at nearly 3,300
suppliers to the retail industry, enabling them to collaborate with their
retailer customers to improve their supply chain management and business
processes. We offer a wide range of retail specific professional services to
help clients rapidly achieve the benefits of our solutions, including project
management, system planning, design and implementation, custom configurations,
training and support services.

     We are moving the organization of our solutions into six business
application domains supported by several shared technology components:

     - MERCHANDISE MANAGEMENT SYSTEMS.  These systems are typically utilized by
       retailers and provide solutions for enterprise management of inventory
       throughout the retail demand chain.

     - IN-STORE SYSTEMS.  These systems are specific to retailers and provide
       point-of-sale tilling functions, in-store inventory management functions
       such as receiving, transfers, price management and physical inventory.
       Our in-store systems now include a workforce management solution to
       optimize in-store labor scheduling.

     - DEMAND CHAIN SOLUTIONS.  These solutions provide management and
       optimization of inventory from finished goods at the CPG manufacturer
       through the demand chain to the end consumer.

     - PLANNING AND FORECASTING SOLUTIONS.  These solutions provide retailers
       and their suppliers the ability to plan and project demand and ensure
       that customer service levels are optimized.

     - CUSTOMER RELATIONSHIP MANAGEMENT SOLUTIONS.  These solutions allow
       management of large numbers of consumer relationships through loyalty
       programs. These solutions are distinct in nature from typical one-to-one
       selling solutions and focus explicitly on the management of large numbers
       of end consumers.

     - REVENUE MANAGEMENT SOLUTIONS.  These solutions are designed to optimize
       pricing and margin, and incorporate the management of advertising and
       marketing functions.

     Our development initiative to move the JDA Portfolio to the Microsoft .Net
Platform (".Net Platform") will enable us to provide point solutions that allow
for the rapid deployment of a portion of the JDA Portfolio to solve a specific
business requirement, while at the same time offering an integrated solution
infrastructure that allows our customers to more readily expand and optimize
their use of the JDA Portfolio (See "OUR PRODUCT STRATEGY").

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JDA BUSINESS SEGMENTS

     We have organized our business segments around the distinct requirements of
retail enterprises, retail stores, and suppliers to the retail industry:

     Retail Enterprise Systems.  The modern retail enterprise is required to
rapidly collect, organize, distribute and analyze, and optimize information
throughout its organization. Retail Enterprise Systems include corporate level
merchandise management systems ("MERCHANDISE MANAGEMENT SYSTEMS") that enable
retailers to manage their inventory, product mix, pricing and promotional
execution, and enhance the productivity and accuracy of warehouse processes. In
addition, Retail Enterprise Systems include a comprehensive set of tools for
planning inventory and in-store space decisions throughout the demand chain,
analyzing business results and trends, automating demand forecasting and
replenishment, tracking customer shopping patterns, optimizing revenues through
trade allowance and promotional program management ("STRATEGIC MERCHANDISE
MANAGEMENT SOLUTIONS").

     In-Store Systems.  Store-level personnel require systems that enhance and
facilitate the retailer's direct interaction with the customer, and integrate
the store-level operations into the overall business processes of the
organization. In-Store Systems include point-of-sale, labor scheduling and back
office applications that enable retailers to capture, analyze and transmit
certain sales, store inventory and other operational information to corporate
level merchandise management and payroll systems using hand-held, radio
frequency devices, point-of-sale workstations or via the Internet. In-Store
Systems now include a workforce management solution to optimize the scheduling
of in-store labor, which typically represents the next largest operational cost
for a retailer after inventory.

     Collaborative Solutions.  CPG manufacturers and distributors are
increasingly required by industry practices developed by retailers such as
Wal*Mart, to collaborate with other participants in the demand chain. While
these companies have historically focused on technology to support their ability
to manufacture and supply products, this new era of collaboration with retailers
has created a requirement for new technology solutions that are designed to
optimize sales of products to end consumers through the retail channel.
Collaborative Solutions provide applications that enable business-to-business
collaborative activities such as collaborative planning, forecasting and
replenishment ("CPFR"), collaborative category management including
collaborative space and assortment planning, and collaborative revenue
management through trade funds management programs. Our Collaborative Solutions
offerings leverage existing solutions deployed to retailers within our Retail
Enterprise Systems business segment.

     Our software products and services are designed to provide the following
benefits:

     A Broad Set of Solutions for the Retail Demand Chain.  We believe the JDA
Portfolio is the broadest, most functional set of industry leading retail demand
chain software solutions available to retailers and their suppliers. Integration
costs often represent a significant expenditure for large enterprise systems.
Our products are designed to be pre-integrated, reducing the time and cost
required to deploy our solutions compared with our competitors. Our broad
solution suite also encourages our customers to adopt our JDA Portfolio
solutions as an internal standard for business applications, allowing them to
simplify their technology partner relationships while reducing the risk of
having one component of their enterprise solution set to be disrupted by the
failure of a smaller point solution provider.

     Enhanced Decision Making and Responsiveness to Consumer Demands.  The JDA
Portfolio solutions help our customers better understand and fulfill consumer
demands while improving operational efficiency. Our products enable vast amounts
of consumer, sales and inventory data to be rapidly collected, organized,
distributed and analyzed. Retailers and their suppliers can explore "what if"
merchandising plans, track and analyze performance, business results and trends,
monitor strategic plans, quickly implement operational strategies based upon
sophisticated fact-based optimization techniques and adjust to changes in
consumer purchasing patterns. The JDA Portfolio solutions also allow our
customers to reduce their inventory exposure while offering the consumer a more
compelling assortment at optimized prices.

     Improved Inventory Management.  The JDA Portfolio solutions enable our
customers to continuously monitor and reduce inventory levels, achieve higher
gross margins, improve their inventory turnover rates and

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more effectively manage their order and distribution processes. We provide
retailers with tools for vendor analysis, stock status monitoring, sales capture
and analysis, merchandise allocation and replenishment, purchase order
management and distribution center management.

     Enhanced Collaboration Between Retailers and Their Suppliers.  As consumer
markets become more competitive, retail customers realize they must do more than
simply achieve increased efficiencies in their own organizations. A retailer's
competitive advantage is now being defined by the efficiencies of their entire
supply chain. As retailers and their suppliers cooperate to improve all aspects
of the supply chain, a new breed of collaborative technology solutions continues
to evolve. We have established a leading position in this new but rapidly
growing market for software solutions. Our Collaborative Solutions allow
retailers and their suppliers to plan and fulfill consumer demand through a
complete suite of collaboration solutions that also enable trading partners to
collaborate in planning, forecasting, replenishment, and space planning
decisions. In addition, we are developing additional functionality that will
enable retailers and their suppliers to make collaborative decisions for
marketing, assortment, and promotion activities. As of December 31, 2003, there
were approximately 200 trading partners worldwide live and fully operational on
our MARKETPLACE REPLENISHMENT CPFR solution.

OUR PRODUCT STRATEGY

     The JDA Portfolio product strategy offers a suite of applications that can
be deployed independently in order to provide a quick return on investment.
These products have been developed or acquired by JDA in order to present
customers with an enterprise offering that we believe is the broadest, most
functional set of industry leading retail demand chain software solutions
available to retailers and their suppliers. In addition, we have developed and
provided the industry with a guaranteed series of integrations between the JDA
Portfolio applications, which allow our customers to rapidly deploy large
portions of the JDA Portfolio functionality with minimal integration costs.
While we have achieved market leadership with this strategy, we believe there
are significant opportunities and advantages to be gained by integrating our
solutions into a common technical framework. This technical framework is based
upon open Web Services standards, and is largely focused around the .Net
Platform. We believe this approach will provide substantial benefits for both
our customers and JDA:

     - Benefits for our Customers.  It will be significantly easier for our
       customers to support and optimize their business processes with the full
       set of products in the JDA Portfolio, which in turn should enhance and
       accelerate our customers' return on their investment. Customers will find
       it easier to learn how to use our applications as the user interfaces
       will be standardized. Additionally, customers will be able to reduce
       their investments in information technology ("IT") infrastructure, and
       the skill levels required of our customers' internal IT personnel to
       support our products will be simplified.

     - Benefits for JDA.  Ultimately, we will be able to reduce the number of
       applications and technologies we maintain while at the same time increase
       the overall depth and breadth of our solution offering. This change
       should reduce our R&D investment requirements in the long-term and allow
       us to accelerate delivery of new functionality. The .Net Platform will
       also enhance our ability to integrate acquisitions of technology that are
       also based upon open Web Services technology. We have incurred and will
       continue to incur, higher than usual R&D expenses as a percentage of
       product revenues, as we complete this transition, one product at a time,
       and keep our current product offerings competitive.

     Our goal is to begin delivering applications on the .Net Platform in third
quarter 2004, starting with PORTFOLIO REPLENISHMENT BY E3, followed by PORTFOLIO
PLANNING BY ARTHUR, and certain of our INTELLECT applications. We expect to
complete the transition to the .Net Platform within the next two to three years.
This is a significant investment by the Company as we are building our next
generation of products, while at the same time, we continue development efforts
on our existing products and complete the integration of acquired products.
Throughout our product transition, we believe that we can also maintain our
ability to deliver point solutions that can quickly address specific business
requirements.

     We believe that enterprise solution providers will increasingly be expected
to provide component-based and Web Services-based solution suites. We further
believe that our ability to provide fully integrated
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solutions within a common technical framework will provide a significant
competitive advantage as many competitive offerings become outdated. We hope to
gain market share as many of our competitors may find it hard to fund a similar
fundamental transition. In addition, our In-Store Systems development initiative
is based on the emerging Java technology.

     As of December 31, 2003, we had 394 employees on our product development
staff. Our product development expenditures in 2003, 2002, and 2001 were $48.5
million $41.8 million, and $34.4 million, which represented 23%, 19%, and 16%,
of total revenues, respectively. We also invested nearly $78 million in
acquisitions of complementary products during the three years ended December 31,
2003. In order to take advantage of certain efficiencies that the migration to
the .Net Platform offers, we consolidated the majority of our development
operations in Scottsdale, Arizona during 2003.

     The risks of our commitment to the .Net Platform include, but are not
limited to, the following:

     - The possibility that prospective customers will refrain from purchasing
       the current versions of products to be re-written because they are
       waiting for the .Net Platform versions;

     - The possibility that our .Net Platform beta customers will not become
       favorable reference sites;

     - Adequate scalability of the .Net Platform for our largest customers;

     - The ability of our development staff to learn how to efficiently and
       effectively develop products using the .Net Platform;

     - Our ability to transition our installed base onto the .Net Platform when
       it is available;

     - Microsoft's ability to achieve market acceptance of the .Net platform;
       and

     - Microsoft's continued commitment to enhancing and marketing the .Net
       platform.

     We are attempting to mitigate some of the foregoing risks with the
following strategies:

     - Provide customers who remain on maintenance with .Net Platform versions
       of our products as part of maintenance;

     - Use of large beta customers to test and to demonstrate scalability;

     - Use of the inherent component-based architecture that will enable us to
       manage changes to the code more efficiently;

     - Focus business process programmers on only certain components, which will
       isolate them from the overall complexity of the technology; and

     - Use of a development methodology whereby we conduct a series of
       performance benchmarks throughout the development effort so that
       performance enhancements are made continuously throughout the project.

     Despite efforts to mitigate the risks of the .Net Platform project, there
can be no assurances that our efforts to re-write many of our current products
and to develop new products using the .Net Platform will be successful. If the
..Net Platform project is not successful, it likely will have a material adverse
effect on our business, operating results and financial condition.

OUR BUSINESS STRATEGY

     Despite relatively flat revenue performance over the past three years, we
believe that our strategy will deliver growth as the level of economic activity
in our markets improves. The major elements of our growth strategy are as
follows:

     - We will continue to invest in our next generation of products based on
       open Web Services technology. We believe this will differentiate us from
       many of our competitors and increase our market share as we bring these
       products to market.

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     - During the development of our next generation of products, we will
       continue to offer support and enhancements to our existing products and
       add complementary functionality to the JDA Portfolio through acquisition.

     - We will continue to focus on providing strategic value to our customers
       through our Customer Value Program. We believe we have the largest retail
       customer base, and that we have an opportunity to grow by achieving a
       more strategic relationship with our customers. Although 70% of our
       software license sales in 2003 were from our existing customer base, we
       still see a growth opportunity because two thirds of our retail customer
       base, and nearly all of our CPG manufacturers and wholesale customers,
       still only own one JDA product.

     - We intend to maintain the functional leadership that we have established
       in the industry. Our solutions, the people who develop them, and our
       sales and consulting associates are highly specialized. We believe this
       specialization makes it difficult for competitors to break into our
       market. Although we sometimes compete with much larger enterprise
       solution providers who have more resources at their disposal, we
       generally believe that our enhanced solutions capabilities and track
       record for delivery will protect our market leadership.

     - We will continue to develop our Collaborative Solutions business segment.
       The collaborative solutions market is still emerging. JDA has established
       an early leadership position and we believe that this market could grow
       to become a substantial portion of our business. There is significant
       opportunity as we market our JDA Portfolio software solutions to
       approximately 3,200 retailers and 26,000 suppliers to the retail industry
       worldwide with annual sales of $100 million or more.

PRODUCTS

MERCHANDISE MANAGEMENT SYSTEMS

     - PORTFOLIO MERCHANDISE MANAGEMENT ("PMM") is an open/client server
       merchandise management system that is designed to operate with Oracle
       relational database management systems running on the most popular UNIX
       platforms and with Windows NT/2000/XP. PMM, which consists of functional
       modules that can be selected and configured to fit multiple processing
       requirements, provides retailers with applications for core inventory
       control, cost and price management, purchase order management,
       promotional planning, automated replenishment, expert pricing, vendor
       submissions, rebate management and a business process level online help
       system. PMM supports the information requirements of international and
       multi-format retail organizations including multiple concurrent languages
       and currencies, user-specific terminology, and user-defined data
       structures. PMM also includes functionality specific to the inventory
       management requirements of the grocery industry for perishable products
       and prepared foods. We have a strategic alliance with Manhattan
       Associates under which we have and will work with mutual and prospective
       customers to develop, maintain, and support a standard tool set to ensure
       ease of integration between PMM and Manhattan Associates' PkMS(R)
       warehouse management application. We feel this strategic alliance will
       enable us to more effectively pursue larger customers that require an
       advanced warehouse management system and extended supply chain execution
       solution.

     - PORTFOLIO MERCHANDISE MANAGEMENT SYSTEM-I ("MMS") is a merchandising
       management system designed for the IBM iSeries environment that we
       believe is one of the most installed merchandise management systems in
       the world. MMS consists of functional modules, similar to those offered
       for PMM, which can be selected by a retailer and configured to fit their
       unique requirements. MMS also features enhanced functionality for apparel
       clients and international retailers, and a JAVA-based graphical user
       interface ("GUI") that incorporates technology licensed from third
       parties.

IN-STORE SYSTEMS

     - WIN/DSS is a Windows based in-store system that provides register
       operations in store, as well as back office processes such as sales
       orders, receiving, store inventory, and returns, and real-time hand-held

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       radio frequency-based data collection and processing. WIN/DSS is also
       integrated with our STORE PORTAL and PORTFOLIO CUSTOMER RELATIONSHIP
       MANAGEMENT offerings to provide enterprise-wide inventory and customer
       management.

     - PORTFOLIO POINT OF SALES ("PPOS") is a Java-based in-store system based
       on intellectual property we acquired from J -- Commerce Inc. in April
       2002. Commercially released in 2003, PPOS features a modular architecture
       that provides advanced point-of-sale and cash register management which,
       when combined with Store Portal, offers a complementary product strategy
       with WIN/DSS for larger customers with annual sales of $5 billion and/or
       a large number of stores/or registers per store.

     - STORE PORTAL is a web-based interface that provides retailers with
       real-time access to enterprise information on their merchandise
       management systems, via the Internet. STORE PORTAL enables retailers to
       immediately initiate associated store level processes such as shipment
       inquiries, transfer requests, store orders, purchase orders and return to
       vendor rather than waiting for a nightly polling process, and to provide
       for greater visibility into enterprise merchandising information at the
       store level.

     - PORTFOLIO PERVASIVE STORE SYSTEM FOR WIN/DSS ("PPS")Iformerly PRISMJ is
       an automated data collection and processing system that enables
       store-level personnel to execute procedures from anywhere in the store
       using a hand-held radio frequency device. With PPS, store-level personnel
       can handle item ticketing while receiving merchandise, handle point of
       sale functions and print receipts. We have also developed PDA PORTAL, a
       browser-based application with functionality similar to PPS, that
       operates on a personal digital assistant (PDA) device.

     - PORTFOLIO WORKFORCE MANAGEMENT ("PWM") is the Enterprise Workforce
       Management solution acquired from Timera Retail Solutions on January 29,
       2004. PWM provides web-based functionality for the retail and consumer
       goods industry in the areas of labor scheduling and budgeting, time and
       attendance, demand forecasting, labor tracking, and other key processes
       for proactive store level labor management.

STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS

DEMAND CHAIN SOLUTIONS:

     - PORTFOLIO ADVANCED REPLENISHMENT SOLUTIONS BY E3 ("PORTFOLIO
       REPLENISHMENT") is an inventory optimization suite acquired from E3
       Corporation in September 2001 that utilizes sophisticated algorithms to
       enable warehouses, distribution centers, and retailers to more
       effectively forecast and replenish inventory, and manage the movement of
       goods from supplier to store. PORTFOLIO REPLENISHMENT includes Advanced
       Warehouse Replenishment by E3 ("AWR"), a warehouse and distribution
       center forecasting and replenishment solution, Advanced Store
       Replenishment by E3 ("ASR"), a store level forecasting and replenishment
       solution, Network Optimization by E3, an application that automatically
       synchronizes and analyzes inventory data between stores and distribution
       centers, and Vendor Managed Inventory by E3 ("VMI"), a collaborative
       solution that facilitates joint management of forecasting and ordering by
       providing trading partners with access and visibility to a retailer's
       orders and forecasts.

PLANNING AND FORECASTING SOLUTIONS:

     - PORTFOLIO PLANNING SOLUTIONS BY ARTHUR ("PORTFOLIO PLANNING") is a set of
       integrated decision support applications based on technology acquired
       from Comshare, Incorporated in June 1998. PORTFOLIO PLANNING is a
       three-tier application that is currently available for end user/client
       applications on Windows 95/98 or NT/2000, for application servers on
       NT/2000, and for database servers on NT/2000, AIX, HP UX, and Sun
       Solaris. PORTFOLIO PLANNING is comprised of five core components:
       Merchandise Planning by Arthur, an application for strategic and channel
       merchandise planning; Advanced Allocation by Arthur, an application for
       product and store allocation decision making; Assortment Planning by
       Arthur, a product assortment planning application for seasonal
       merchandise (typically own brand); Arthur Knowledge Base ("AKB"), a
       database that allows for central organiza-

                                        7


       tion of data and applications; and Performance Analysis by Arthur, a web
       based analytical tool designed to support the analysis of planning and
       actual performance information using the AKB operating on Unix/Oracle.
       PORTFOLIO SOLUTIONS also include Rapid Packages by Arthur, a deployment
       template that provides retailers with the industry's best practice
       implementation methodology.

     - PORTFOLIO SPACE MANAGEMENT SOLUTIONS BY INTACTIX ("PORTFOLIO SPACE
       MANAGEMENT") is a set of space management applications acquired from
       Intactix International, Inc. in April 2000. PORTFOLIO SPACE MANAGEMENT,
       which enables retailers to collaborate with their suppliers to ensure
       optimal product mix and shelf positioning, is comprised of four core
       components: Space Planning by Intactix, a next generation planogramming
       solution used by both retailers and their suppliers, that allows users to
       build, analyze, and distribute graphical diagrams for space management,
       store layout planning and shelf assortment analysis; Floor Planning by
       Intactix, a floor planning tool that enables retailers and their
       suppliers to merge store design efforts with category and space planning;
       Efficient Item Assortment by Intactix ("EIA"), a tool providing product
       assortment planning for branded merchandise; and Intactix Knowledge Base,
       an enterprise level relational database supporting the Space Planning and
       Floor Planning applications, as well as all product and fixture
       information for an entire store system. PORTFOLIO SPACE MANAGEMENT also
       includes applications for streamlining day-to-day space management
       business processes including Web Publisher by Intactix that enables
       retailers and manufacturers to distribute planograms and floor plan data
       via the internet; Space Automation by Intactix that utilizes a
       business-level scripting tool to automate day-to-day activities performed
       within the Space Planning, Floor Planning and Intactix Knowledge Base
       applications; and Planogram Converter by Intactix that facilitates the
       conversion and migration of planogram data available on competing
       systems.

CUSTOMER RELATIONSHIP MANAGEMENT SOLUTIONS:

     - PORTFOLIO CUSTOMER RELATIONSHIP MANAGEMENT ("PORTFOLIO CRM")Iformerly
       AFFINITYJ is a customer relationship management solution that enables
       retailers to support and proactively manage customer information from
       multiple channels and targeted e-mail and mail campaigns. PORTFOLIO CRM
       currently consists of three modular, open/client server applications: the
       Base Customer Data module provides retailers with a single point for
       collecting, querying, analyzing and managing basic customer data such as
       name and address, as well as transaction history tracking and multiple
       customer attributes, including number of visits, products purchased and
       returned, sizes and demographic information; the Target Marketing module
       enables retailers to identify targeted lists of customers that are most
       likely to respond to a given promotional event, and the Customer
       Scorecard module provides a retailer's sales associates with quick access
       to customer transaction history that enables them to guide customers to
       merchandise matching their preferences and recommends opportunities for
       additional products related to previous purchases. Customer Loyalty,
       scheduled for commercial release in 2004, will enable retailers to define
       and maintain a marketing strategy that rewards repeat or volume customers
       with financial incentives.

     - CUSTOMER ORDER MANAGEMENT-I ("CUSTOMER ORDERING")Iformerly MMS
       MULTI-CHANNEL ORDER PROCESSINGJ is an integrated e-commerce software
       application that works in tandem with MMS and provides retailers with an
       Internet-based sales and delivery system. CUSTOMER ORDERING integrates
       all back-end processing and allows retailers to automate their product
       catalogs, manage inventory and prices, interface with credit providers,
       fulfill and ship orders, track customer information and process returns.

REVENUE MANAGEMENT SOLUTIONS:

     - VENDOR INCENTIVE MANAGEMENT ("VIM") is a software application acquired
       from Zapotec Software, Inc. in February 2001. VIM enables retailers,
       suppliers and distributors to manage their trade allowance and
       promotional programs by automating the contract fulfillment, claim
       generation and accounts receivable process.

                                        8


     - MARKETING EXPENSE MANAGEMENT ("MEM") is a solution that enables
       retailers, wholesalers and manufacturers to automate advertising and
       promotional practices to maximize efficiencies and bottom line benefits.
       With MEM, users can easily manage multiple budgets, accruals and actual
       expenses on a single solution. MEM also automates the entire media
       procurement process, including issuing purchase orders and insertion
       orders, as well as tracking invoices and revisions, to increase accuracy
       and associate productivity.

     - VISTA CPG is a web-based software application acquired from Vista
       Software Solutions, Inc. in April 2003. VISTA CPG contains a series of
       modules that enable consumer goods manufacturers to manage trade
       promotions, minimize trade deductions costs and more accurately forecast
       product demand.

     - ENGAGE FOR RETAILERS is a series of enterprise advertising, marketing and
       promotion software applications acquired from Engage, Inc. in August
       2003. The advance digital asset, content management and ad layout
       capabilities of these applications improve a retailer's promotional
       planning process and their delivery of marketing and advertising content,
       and streamlines the communication and collaboration among a retailer's
       merchandising, promotions, production and store operation teams. Versions
       of these applications are also available for advertising agencies,
       newspaper, and marketing organizations.

SHARED TECHNOLOGY COMPONENTS:

     - INTELLECT is a series of advanced analytic modules that are designed to
       optimize specific business problems through the use of data mining,
       analytic and clustering techniques. The current series of INTELLECT
       modules include: Demand Planning by Intellect, which enables retailers to
       create accurate pre-season demand forecasts for planning purposes and the
       ability to create in-season forecasts that utilize the current season
       trend, sales to date and a planned inventory position; Seasonal Profiling
       by Intellect, which allows retailers to optimize their creation and
       management of seasonal replenishment profiles using clustering
       techniques; Channel Clustering by Intellect, which enables retailers to
       group stores together for planning and assortment planning purposes, or
       allocation and replenishment modeling, using detailed sales level data to
       indicate customer preference patterns by department, category, product,
       price points and brands; and Size Scaling by Intellect, which is targeted
       primarily to fashion retailers and will determine a best-fit size
       template for ordering, allocation and replenishment by style, class or
       department. We anticipate the development of an Event Lift Forecasting by
       Intellect module that will use sophisticated INTELLECT data mining
       engines to provide forecasts of promotional sales uplifts.

     - PERFORMANCE ANALYSIS BY IDEAS ("IDEAS") is a data warehouse system
       developed jointly with Silvon Software, Inc. that provides a
       comprehensive set of tools for analyzing business results, monitoring
       strategic plans and enabling tactical decisions. IDEAS is currently
       available on the IBM iSeries, Windows NT/2000/XP, and Unix/Oracle
       platforms. IDEAS is designed as a packaged offering that enables
       retailers to monitor vendor performance, promotional effectiveness and
       distribution center productivity, and to analyze financial measurements
       related to sales and inventory, margins and profitability, merchandise
       categories, open and suggested orders, and promotional and pricing
       events. We also offer a Performance Analysis by IDEAS, Distribution Model
       ("DISTRIBUTION IDEAS") application that provides access to current
       information on key performance indicators such as inventory position,
       service levels, vendor performance, forecasts and shipments.

     - PORTFOLIO KNOWLEDGE BASE ("PKB") offers real-time configurable access to
       historical, enterprise data such as sales and inventory movement. PKB
       provides mechanisms to load, unload, structure, maintain and administer
       analytical data cubes, relational summary tables and a meta data
       environment.

     - PORTFOLIO REGISTRY, as designed, will provide a single graphical user
       interface, and a single set of input programs and screens for use by all
       JDA Portfolio applications. It will be the source for all of a company's
       descriptive data as well as provide a gateway to synchronize with third
       party sources and catalogs (i.e., UCCnet, EAN, etc.).

                                        9


COLLABORATIVE SPECIFIC SOLUTIONS:

     - JDAMARKETPLACE.COM is a portal that enables trading partners to easily
       navigate to collaborative solutions and partners via the Internet. In
       addition, JDAMARKETPLACE.COM provides educational insights and recent
       news for those interested in the collaborative space.

     - MARKETPLACE REPLENISHMENT is a web based solution designed to deliver
       collaborative planning, forecasting and replenishment between retailers
       and their suppliers. As of December 31, 2003, there were approximately
       200 trading partners worldwide live and operational on our MARKETPLACE
       REPLENISHMENT CPFR solution that provides web-based portal access to the
       Advanced Warehouse Replenishment by E3 and Advanced Store Replenishment
       by E3 applications and enables the creation of a single, shared demand
       forecast that retailers and their suppliers can use to lower distribution
       and freight costs, increase annual sales, improve forecast accuracy,
       lower inventory requirements, and increase human productivity.

     - ELECTRONIC DYNAMIC AGREEMENT ("EDA") is a web-based solution designed to
       support extended vendor management of the replenishment process by
       transferring control of the buying decision to the vendor.

     - ITEM SYNCHRONIZATION, as designed, is a web-based software application
       based on technology acquired from Vista Software Solutions, Inc. in April
       2003, that will provide data synchronization using UCCnet as a datapool.

PORTFOLIO CUSTOMER SUPPORT

     We offer PORTFOLIO CUSTOMER SUPPORT services that include product
maintenance, on-line support, and access to our Solution Centers via telephone
and web interfaces. Our standard maintenance services agreement entitles
customers to receive unspecified new product releases (exclusive of those which
introduce significant new functionality), access to our Solution Centers, and
comprehensive error diagnosis and correction. Customers have the option of
choosing service programs that extend hours of coverage, incorporate support for
custom configurations, or provide special attention through periods of high
activity or upgrade processing. We also offer enhanced support services that
provide customers with difficult to find technical skills, such as database
administration or with an outsource alternative to help desk and other
information technology services. The vast majority of our customers have
typically participated in one or more of our PORTFOLIO CUSTOMER SUPPORT
programs.

PORTFOLIO CUSTOMER SERVICES

     - CONSULTING.  Our consulting services group consists of business
       consultants, systems analysts and technical personnel with extensive
       retail, manufacturing, and wholesale industry experience. The consulting
       services group assists our customers in all phases of systems
       implementation, including systems planning and design, customer-specific
       configuration of application modules, and on-site implementation or
       conversion from existing systems. We also offer a variety of
       post-implementation services designed to maximize our customers' return
       on software investment, which include enhanced utilization reviews,
       business process optimization and executive "how to" sessions. The "how
       to" sessions empower executives to access key management reports online
       instead of referring to spreadsheets. Consulting services are billed
       primarily on an hourly basis and from time to time under fixed price
       contracts. In addition, we augment our services on large-scale
       implementations and extensive business process re-engineering projects
       with third-party alliances, consulting firms and systems integrators. Our
       consulting engagements have typically taken between three months and one
       year for Retail Enterprise Systems, between four and eight months for
       In-Store Systems, and 30 to 90 days for Collaborative Solutions. Since
       2001, we believe retailers have changed their buying behavior and that
       this has resulted in a fundamental shift in the mix of demand for the
       various types of products we sell from the longer, high dollar
       infrastructure type projects typically associated with our MERCHANDISE
       MANAGEMENT SYSTEMS and IN-STORE SYSTEMS, to our STRATEGIC MERCHANDISE
       MANAGEMENT SOLUTIONS that are less disruptive, have a higher ROI and
       shorter implementation timeframes.

                                        10


       We also believe the implementation time frames for our software products
       have shortened as a result of the increased expertise, training, and
       efficiency of our consulting services group, and as a result of more than
       $178 million in internal product development expenditures over the past
       five years that have improved the stability, scalability, integration,
       ease of installation and overall quality of our products

     - TRAINING.  We offer a comprehensive education and training program for
       our customers, associates and business partners through our BUSINESS
       MANAGEMENT INSTITUTE ("BMI"). BMI features a curriculum for each of our
       software solutions, prepaid training packages, and a full-time staff
       consisting of professional instructors and course developers. The BMI
       curriculum includes more than 120 courses that range from basic
       overviews, implementation and technical/developer classes to business
       process education and key topics and techniques for the supply chain.
       Courses are offered primarily at our in-house classroom facilities in
       Scottsdale, Atlanta, Dallas, Chicago, London and Singapore, and through
       customized on-site classes. In addition, during 2003 we introduced
       JDALEARN, a web-based education alternative, which offers online learning
       in areas such as category management, space planning, replenishment, data
       mining, analysis tools and store systems. More than 6,000 individuals
       attended BMI classes during 2003.

CUSTOMERS

     Our customers include approximately 4,500 of the world's leading retail,
CPG manufacturers and wholesalers. We believe we have the largest retail
customer installed base among our direct competitors, with more than 1,200
retail customers in over 60 countries that own at least one of our products. JDA
serves a diverse client base from specialty powerhouse chains with more than
5,000 retail stores and multi format food chains, to global consumer packaged
goods manufacturers and hard goods distributors. Our software is capable of
supporting our clients' multi-channel operations, which may include
brick-and-mortar stores, Internet, e-commerce, catalog and wholesale
distribution. We market our software solutions to approximately 3,200 retailers
worldwide with annual sales of $100 million or more. Our acquisitions of Arthur,
Intactix, E3 and Vista expanded our client base to include nearly 3,300
suppliers to the retail industry and added software applications that enable
business-to-business CPFR and promotion management between retailers and their
suppliers. These acquisitions, together with the investments we've made over the
past five years to increase the scalability of our products, have enabled us to
pursue emerging growth opportunities in the retail supply chain and further
expand our target markets to include larger multi-national retail organizations
and approximately 26,000 suppliers to the retail industry worldwide with annual
sales of $100 million or more.

SALES AND MARKETING

     We market our products and services almost exclusively through our direct
sales force. Our Americas direct sales force is based in Scottsdale, Arizona
with 15 regional sales and support offices across the United States, Canada and
Latin America. We also have international sales representatives located in 19
sales and support offices in major cities throughout Europe, Asia, Australia,
and Japan.

     Sales to new customers have historically required between three and nine
months from generation of the sales lead to the execution of a software license
agreement. Sales cycles are typically longer for larger dollar projects, large,
multi-national retail organizations and retailers in certain geographic regions.
During 2003, we noted an increase in CEO and board approval requirements for
larger dollar contracts that increased the traditional time from lead generation
to the execution of a software agreement. In addition, our strategy of offering
a comprehensive portfolio of integrated software applications, that can be
installed independently or as a complete solution, has created increased
back-selling opportunities to existing customers. These sales typically require
shorter sales cycles and are less competitive. As of December 31, 2003, our
sales and marketing organization consisted of 99 employees in the Americas, 54
in Europe and 14 in Asia/Pacific. These totals include 46, 27 and 8 direct sales
representatives, respectively.

                                        11


COMPETITION

     We encounter competitive products from a different set of vendors in each
of our primary product categories. We believe that while our markets are still
subject to intense competition, the number of significant competitors in many of
our application markets has diminished over the past five years. We believe the
principal competitive factors in our markets are feature and functionality,
product reputation and reference accounts, vendor viability, retail and supply
chain industry expertise, total solution cost and quality of customer support.

     Our Retail Enterprise Systems compete primarily with internally developed
systems and other third-party developers such as AC Nielsen Corporation, Aldata
Solutions, Alphameric PLC (formerly Compass Software Group PLC), Connect3
Systems, Inc., Island Pacific, Inc. (formerly SVI Holdings, Inc., Marketmax,
Inc. (recently acquired by SAS), Micro Strategies Incorporated, Evant, Inc.
(formerly Nonstop Solutions), Lawson Software, NSB Retail Systems PLC, Retek,
Inc., and SAP AG. In addition, new competitors may enter our markets and offer
merchandise management systems that target the retail industry.

     The competition for our In-Store Systems is more fragmented than the
competition for our Retail Enterprise Systems. We compete primarily with small
point-of-sale focused companies such as CRS Business Computers, Kronos
Incorporated, MICRO Systems, Inc. (formerly Datavantage, Inc.), Radiant Systems,
Inc., 360 Commerce, Tomax Technologies and Triversity, Inc. We also compete with
other broad solution set providers such as NSB Retail Systems PLC, Retek, Inc.,
and SAP AG (Campbell Software Division).

     Our current Collaborative Solutions compete primarily with products from
Marketmax, Inc. (recently acquired by SAS), Evant Inc. (formerly Nonstop
Solutions), AC Nielsen Corporation, i2 Technologies, Manugistics Group, Inc.,
Information Resources, Inc., and Synchra Systems.

     In the market for consulting services, we have pursued a strategy of
forming informal working relationships with leading retail systems integrators
such as IBM Global Services, Cap Gemini Ernst & Young, Kurt Salmon Associates
and Lakewest Consulting. These integrators, as well as independent consulting
firms such as Accenture, AIG Netplex, CFT Consulting, SPL and ID Applications,
also represent competition to our consulting services group. Moreover, because
many of these consulting firms are involved in advising our prospective
customers in the software selection process, they may successfully encourage a
prospective customer to select software from a software company with whom they
have a relationship. Examples of such relationships between consulting firms and
software companies include the relationships between Retek, Inc. and Accenture.

     As we continue to develop or acquire e-commerce products and expand our
business in the Collaborative Solutions area, we expect to face potential
competition from business-to-business e-commerce application providers,
including Ariba, Commerce One, Commercialware, i2 Technologies, Manugistics
Group, Inc., Microsoft, Inc., Retek, Inc., SAP AG, Synchra Systems, Ecometry
Corporation, and others.

     A few of our existing competitors, as well as a number of potential new
competitors, have significantly greater financial, technical, marketing and
other resources than we do, which could provide them with a significant
competitive advantage over us. In addition, we could face competition from
large, multi-industry technology companies that have historically not offered an
enterprise solution set to the retail supply chain market. We cannot guarantee
that we will be able to compete successfully against our current or future
competitors, or that competition will not have a material adverse effect on our
business, operating results and financial condition.

PROPRIETARY RIGHTS

     Our success and competitive position is dependent in part upon our ability
to develop and maintain the proprietary aspect of our technology. The reverse
engineering, unauthorized copying, or other misappropriation of our technology
could enable third parties to benefit from our technology without paying for it.

     We rely on a combination of trademark, trade secret, copyright law and
contractual restrictions to protect the proprietary aspects of our technology.
We seek to protect the source code to our software, documentation

                                        12


and other written materials under trade secret and copyright laws. To date, we
have not protected our technology with issued patents. Effective copyright and
trade secret protection may be unavailable or limited in certain foreign
countries. We license our software products under signed license agreements that
impose restrictions on the licensee's ability to utilize the software and do not
permit the re-sale, sublicense or other transfer of the source code. Finally, we
seek to avoid disclosure of our intellectual property by requiring employees and
independent consultants to execute confidentiality agreements with us and by
restricting access to our source code.

     We license and integrate technology from third parties in certain of our
software products. For example, we license the Uniface client/server application
development technology from Compuware, Inc. for use in PMM, certain applications
from Silvon Software, Inc. for use in IDEAS, IBM's Net.commerce merchant server
software for use in CUSTOMER ORDERING, and the Syncsort application for use in
the Arthur Knowledge Base component of PORTFOLIO PLANNING. Our third party
licenses generally require us to pay royalties and fulfill confidentiality
obligations. If we are unable to continue to license any of this third party
software, or if the third party licensors do not adequately maintain or update
their products, we would face delays in the releases of our software until
equivalent technology can be identified, licensed or developed, and integrated
into our software products. These delays, if they occur, could harm our
business, operating results and financial condition. It is also possible that
intellectual property acquired from third parties through acquisitions, mergers,
licenses or otherwise may not have been adequately protected, or infringes
another parties intellectual property rights.

     There has been a substantial amount of litigation in the software and
Internet industries regarding intellectual property rights. It is possible that
in the future third parties may claim that our current or potential future
software solutions infringe their intellectual property. We expect that software
product developers and providers of e-commerce products will increasingly be
subject to infringement claims as the number of products and competitors in our
industry segment grows and the functionality of products in different industry
segments overlap. Moreover, as software patents become more common, the
likelihood increases that a patent holder will bring an infringement action
against us, or against our customers, to whom we have indemnification
obligations. In addition, we may find it necessary to initiate claims or
litigation against third parties for infringement of our proprietary rights or
to protect our trade secrets. Since we also resell hardware we may also become
subject to claims from third parties that the hardware, or the combination of
hardware and software, infringe their intellectual property. Although we may
disclaim certain intellectual property representations to our customers, these
disclaimers may not be sufficient to fully protect us against such claims. We
may be more vulnerable to patent claims since we do not have any patents that we
can assert defensively against a patent infringement claim. Any claims, with or
without merit, could be time consuming, result in costly litigation, cause
product shipment delays or require us to enter into royalty or license
agreements. Royalty or licensing agreements, if required, may not be available
on terms acceptable to us or at all, which could have a material adverse effect
on our business, operating results and financial condition.

     Our standard software license agreements contain an infringement indemnity
clause under which we agree to indemnify and hold harmless our customers and
business partners against liability and damages arising from claims of various
copyright or other intellectual property infringement by our products. These
terms constitute a form of guarantee that is subject to the disclosure
requirements, but not the initial recognition or measurement provisions of
Financial Accounting Standards Board issued FASB Interpretation No. 45,
"Guarantor's Accounting and Disclosure Requirements for Guarantees, Including
Indirect Guarantees of the Indebtedness of Others." We have never lost an
infringement claim and our costs to defend such lawsuits have been
insignificant. Although it is possible that in the future third parties may
claim that our current or potential future software solutions or we infringe on
their intellectual property, we do not currently expect a significant impact on
our business, operating results, or financial condition.

EMPLOYEES

     As of December 31, 2003, we had 1,291 employees: 978 based in the Americas,
211 based in Europe, and 102 based in Asia/Pacific. Of the total, 167 were
engaged in sales and marketing, 430 were in consulting services, 159 were
engaged in client support services, 394 were in product development, and 141
were in

                                        13


administrative functions. We believe that our relations with our employees are
good. We have never had a work stoppage and none of our employees are subject to
a collective bargaining agreement.

     Our future operating results depend significantly upon the continued
service of our key technical and senior management personnel, and our continuing
ability to attract and retain highly qualified technical and managerial
personnel. Competition for such personnel is intense, and there can be no
assurance that we will retain our key managerial or technical personnel or that
we can attract, assimilate and retain such personnel in the future. We have at
times experienced difficulty recruiting qualified personnel, and there can be no
assurance that we will not experience such difficulties in the future. If we are
unable to hire and retain qualified personnel in the future, or if we are unable
to assimilate the employees from any acquired businesses, such inability could
have a material adverse effect on our business, operating results and financial
condition.

AVAILABLE INFORMATION

     Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current
reports on Form 8-K, and amendments to those filed or furnished pursuant to
Sections 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, are
available free of charge from our website at www.jda.com, as soon as reasonably
practicable after we electronically file such material with, or furnish it to,
the Securities and Exchange Commission.

ITEM 2.  PROPERTIES

     Our corporate office is located in Scottsdale, Arizona, where we currently
occupy approximately 121,000 square feet of a 136,000 square foot facility and
have expansion rights on the remaining space. The corporate office is also used
for certain of our sales, marketing, consulting, customer support, training, and
product development functions. The lease on the corporate office, which
commenced in April 1999, had an initial term of ten years and a scheduled
monthly rate of approximately $135,000 that was effective through March 2004. In
June 2003, we agreed to take the remaining 15,000 square feet, effective
November 2004, and extended the term of lease through December 2014. Subsequent
to December 31, 2003, we purchased our corporate office facility for
approximately $23.8 million in cash. This transaction closed on February 5,
2004. The purchase includes the corporate office building, a new two-story
parking garage, and approximately 8.8 acres of land upon which these structures
are located. We believe this purchase will result in a $1.2 million to $1.5
million net reduction in our annual operating costs.

     We also own approximately 15,000 square feet of office space in the United
Kingdom, and lease office space in the Americas for 15 regional sales and
support offices across the United States, Canada and Latin America, and for 18
international sales and support offices located in major cities throughout
Europe, Asia, Australia, and Japan. The leases are primarily noncancellable
operating leases and expire at various dates through the year 2014. Certain of
the leases contain renewal options. We expect that in the normal course of
business some or all of these leases will be renewed or that suitable additional
or alternative space will be available on commercially reasonable terms as
needed. In April 2003, we sold a freestanding 5,000 square foot office facility
in the United Kingdom for approximately $1.6 million and realized a gain of
$639,000. We believe our existing facilities are adequate for our current needs.

ITEM 3.  LEGAL PROCEEDINGS

     We are involved in legal proceedings and claims arising in the ordinary
course of business. Although there can be no assurance, management does not
believe that the disposition of these matters will have a material adverse
effect on our business, financial position, results of operations or cash flows.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of security holders during fourth
quarter 2003.

                                        14


                                    PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

     Our common stock trades on the NASDAQ Stock Market ("NASDAQ") under the
symbol "JDAS." The following table sets forth, for the periods indicated, the
high and low sales prices per share of our common stock for the two most recent
fiscal years as reported on NASDAQ.



YEAR ENDED 2003                                                HIGH     LOW
- ---------------                                               ------   -----
                                                                 
1st Quarter.................................................  $12.90   $8.77
2nd Quarter.................................................   15.10    8.35
3rd Quarter.................................................   18.17   10.78
4th Quarter.................................................   22.36   14.81




YEAR ENDED 2002                                                HIGH     LOW
- ---------------                                               ------   ------
                                                                 
1st Quarter.................................................  $32.82   $20.13
2nd Quarter.................................................   35.89    20.90
3rd Quarter.................................................   28.40     6.37
4th Quarter.................................................   12.22     5.10


     On March 5, 2004, the closing sale price for our common stock was $16.10
per share. On this date, there were approximately 260 holders of record of our
common stock. This figure does not reflect what we believe are approximately
4,000 beneficial stockholders whose shares are held in nominee names by brokers
and other institutions. We have never declared or paid any cash dividend on our
common stock. Since we presently intend to retain future earnings to finance the
growth and development of our business, we do not anticipate paying cash
dividends on our common stock in the foreseeable future.

     The market price of our common stock has experienced large fluctuations and
may continue to be volatile in the future. Factors such as future announcements
concerning us or our competitors, quarterly variations in operating results,
announcements of technological innovations, the introduction of new products or
changes in product pricing policies by us or our competitors, proprietary rights
or other litigation, changes in our growth prospects, changes in earnings
estimates by analysts or other factors could cause the market price of our
common stock to fluctuate substantially. Further, the stock market has from time
to time experienced extreme price and volume fluctuations that have affected the
market price for many high technology companies and which, on occasion, have
been unrelated to the operating performance of those companies. These
fluctuations, as well as the general economic, market and political conditions
both domestically and internationally, including recessions, military conflicts
including the threat of war with Iraq, or acts of terrorism such as the
September 11 attack, may materially and adversely affect the market price of our
common stock.

ITEM 6.  SELECTED FINANCIAL DATA

     The following selected financial data should be read in conjunction with
our consolidated financial statements and related notes and with "Management's
Discussion and Analysis of Financial Condition and Results of Operations"
included elsewhere herein. The selected consolidated financial data presented
below under the captions "Consolidated Statement of Income Data" and
"Consolidated Balance Sheet Data" for, and as of the end of, each of the years
in the five-year period ended December 31, 2003, are derived from the
consolidated financial statements of JDA Software Group, Inc. The consolidated
financial statements as of December 31, 2003 and 2002, and for each of the years
in the three-year period ended December 31, 2003, and the independent auditors'
report thereon, are included elsewhere herein.

                                        15


CONSOLIDATED STATEMENT OF INCOME DATA:



                                                        YEAR ENDED DECEMBER 31,
                                          ----------------------------------------------------
                                            2003       2002       2001       2000       1999
                                          --------   --------   --------   --------   --------
                                                  (IN THOUSANDS EXCEPT PER SHARE DATA)
                                                                       
REVENUES:
  Software licenses.....................  $ 59,283   $ 66,625   $ 71,220   $ 62,640   $ 36,798
  Maintenance services..................    71,111     57,570     40,568     30,380     18,924
                                          --------   --------   --------   --------   --------
     Product revenues...................   130,394    124,195    111,788     93,020     55,722
  Consulting services...................    70,167     87,608     95,124     78,709     86,941
  Reimbursed expenses...................     6,858      7,652      6,904      6,970      3,736
                                          --------   --------   --------   --------   --------
     Service revenues...................    77,025     95,260    102,028     85,679     90,677
     Total revenues.....................   207,419    219,455    213,816    178,699    146,399
                                          --------   --------   --------   --------   --------
COST OF REVENUES:
  Cost of software licenses.............     1,315      2,035      2,376      2,947      1,955
  Amortization of acquired software
     technology.........................     4,518      4,247      2,971      1,834        779
  Cost of maintenance services..........    17,373     14,292     11,159      7,655      6,245
                                          --------   --------   --------   --------   --------
     Cost of product revenues...........    23,206     20,574     16,506     12,436      8,979
  Cost of consulting services...........    58,233     63,837     69,953     64,965     64,362
  Reimbursed expenses...................     6,858      7,652      6,904      6,970      3,736
                                          --------   --------   --------   --------   --------
     Cost of service revenues...........    65,091     71,489     76,857     71,935     68,098
     Total cost of revenues.............    88,297     92,063     93,363     84,371     77,077
                                          --------   --------   --------   --------   --------
GROSS PROFIT............................   119,122    127,392    120,453     94,328     69,322
OPERATING EXPENSES:
  Product development...................    48,529     41,819     34,406     28,840     25,000
  Sales and marketing...................    41,612     39,941     37,998     28,770     24,639
  General and administrative............    23,473     26,978     27,099     20,761     17,195
  Amortization of intangibles...........     3,067      2,849      5,526      4,708      3,630
  Relocation costs to consolidate
     development and support
     activities.........................     1,794        452         --         --         --
  Restructuring, asset disposition and
     other merger related charges.......        --      6,287        985        828      2,111
  Purchased in-process research and
     development........................        --        800      2,361        200         --
  Gain on sale of office facility.......      (639)        --         --         --         --
                                          --------   --------   --------   --------   --------
     Total operating expense............   117,836    119,126    108,375     84,107     72,575
                                          --------   --------   --------   --------   --------
OPERATING INCOME (LOSS).................     1,286      8,266     12,078     10,221     (3,253)
     Other income, net..................     1,347      1,700      2,671      4,246      3,814
                                          --------   --------   --------   --------   --------
INCOME BEFORE INCOME TAXES..............     2,633      9,966     14,749     14,467        561
     Income tax (benefit) provision.....       (17)     1,036      5,101      5,599        224
                                          --------   --------   --------   --------   --------
NET INCOME..............................  $  2,650   $  8,930   $  9,648   $  8,868   $    337
                                          ========   ========   ========   ========   ========
BASIC EARNINGS PER SHARE................  $    .09   $    .32   $    .38   $    .36   $    .01
                                          ========   ========   ========   ========   ========
DILUTED EARNINGS PER SHARE..............  $    .09   $    .31   $    .37   $    .35   $    .01
                                          ========   ========   ========   ========   ========
SHARES USED TO COMPUTE:
  Basic earnings per share..............    28,645     28,047     25,316     24,315     23,758
  Diluted earnings per share............    29,104     29,074     25,757     25,431     23,758


                                        16


CONSOLIDATED BALANCE SHEET DATA:



                                                              DECEMBER 31,
                                          ----------------------------------------------------
                                            2003       2002       2001       2000       1999
                                          --------   --------   --------   --------   --------
                                                             (IN THOUSANDS)
                                                                       
Cash and cash equivalents...............  $ 77,464   $ 71,065   $ 51,865   $ 60,794   $ 58,283
Marketable securities(1)................    37,266     30,790     12,140     15,800     35,245
Working capital.........................   126,045    120,956     93,094    112,752    108,486
Total assets............................   320,625    315,054    288,642    218,472    197,045
Long-term liabilities(2)................        --      4,980     10,810          -          -
Stockholders' equity(3).................   269,789    256,766    224,450    186,265    174,863


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

(1) The 1999 totals include $4,822,000 of non-current marketable securities.

(2) Deferred tax liability.

(3) We have never declared or paid any cash dividend on our common stock.

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

OVERVIEW

     We are a leading provider of sophisticated software solutions designed
specifically to address the demand and supply chain management, business
process, decision support, e-commerce, inventory optimization, and collaborative
planning and forecasting requirements of the retail industry and its suppliers.
Our collaborative specific solutions enable retailers and their suppliers to
optimize the sharing of plans, information and supply chain decisions between
trading partners in such areas of inventory replenishment, marketing/promotions,
sales planning/execution and category management. We also offer maintenance
services to our software customers, and enhance and support our software
business by offering implementation and other services that are designed to
enable our clients to rapidly achieve the benefits of our solutions. These
services include project management, system planning, system design and
implementation, custom configurations, and training services. Demand for our
implementation services is driven by, and often trails, sales of our software
products. Consulting services revenues are generally more predictable but
generate significantly lower gross margins than software license revenues. Our
maintenance services revenue stream is the most predictable portion of our
business and has grown in excess of 23% in each of the last three years. During
2003 our retention rate for maintenance customers was more than 93%.

SIGNIFICANT TRENDS AND DEVELOPMENTS IN OUR BUSINESS

     Outlook for 2004.  We see signs of recovery in North America and currently
have a strong domestic software sales pipeline. However, we see no broad signs
of economic recovery in Europe or Asia/Pacific. Our results in the European
region have also been impacted by operational issues and the departure of the
regional vice president in fourth quarter 2003. We believe this situation may
have an adverse impact on the sales effort in Europe during the first half of
2004. We believe there are a significant number of sales opportunities that will
support a sustained level of activity; however, we do not anticipate a
substantial increase in software license revenues during 2004. We also believe
at this time there are a limited number of outstanding prospects in the
transaction system market for MERCHANDISE MANAGEMENT SYSTEMS and IN-STORE
SYSTEMS. The preponderance of the business in the near term software sales
pipeline continues to be for STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS.

     We currently anticipate sequential increases in maintenance services
revenues throughout 2004, and we believe this revenue stream will increasingly
dominate our total revenue and profitability. We also anticipate a sequential
increase in consulting service revenues in first quarter 2004 compared to fourth
quarter 2003 due to the seasonal impact of the holidays on fourth quarter 2003
results. We have taken various actions to address the profitability of our
consulting services business. We believe these changes will result in gradually
improving service margins during 2004. (see "Service Revenues Continue to
Decline and We Have Taken

                                        17


Steps to Improve Our Service Margins"). Other than a minor reduction in costs
resulting from the changes we've made to the incentive compensation programs of
our consultants, we expect total costs and expenses for first quarter 2004 to be
comparable with fourth quarter 2003. We expect to invest approximately $13.0
million per quarter in product development in the first half of 2004 to complete
our .Net launch initiatives. We may adjust this spending rate in the second half
of 2004 depending upon the outlook for IT spending and other product specific
delivery requirements. We have reviewed the cost structure in each geographic
region and are making appropriate adjustments to better match costs with
anticipated revenue results during the quarter ending March 31, 2004. We expect
to record a restructuring charge of $2.6 million to $3.0 million in first
quarter 2004 for a workforce reduction and office closure costs. The workforce
reductions associated with this charge will be made by March 31, 2004 and will
include approximately 55 full-time consulting, sales and product development
employees in the Americas, Europe and Asia/Pacific. Office closure costs pertain
to certain US, Canadian and European offices that were used primarily by
consulting services personnel.

     We purchased our corporate office facility on February 5, 2004 for
approximately $23.8 million in cash. The purchase includes the corporate office
building, a new two-story parking garage, and approximately 8.8 acres of land
upon which these structures are located. We believe this purchase will result in
a $1.2 million to $1.5 million net reduction in our annual operating costs.

     Economic Conditions Continue to Impact our Operating Results.  Our
operating results continue to be impacted by weak economic conditions in our
international regions and the continued weakness in the retail industry. We
believe economic conditions in the Americas region may have begun to recover, as
our customers appear to have improved confidence and willingness to make capital
expenditures for information technology. However, the outlook for the other
regions of the world remains inconsistent and we see no broad signs of
improvement in Europe or Asia/Pacific.

     The retail industry continues to exercise significant due diligence prior
to making large capital outlays, and the decision-making process for investments
in information technology remains highly susceptible to deferral. As a result,
our sales cycles remain elongated and we continue to experience uncertainty
predicting the size and timing of individual contracts. For example, we signed
no large software licenses ($1.0 million or greater) in fourth quarter 2003, as
compared to four during both third and second quarter 2003, none during first
quarter 2003, and three in fourth quarter 2002. Although orders for certain of
our products can be taken over the telephone, the average sales cycle for larger
software license contracts can range from six months to over one year. We
continue to believe that delays in the decision-making process have been, and
may continue to be, the most significant issue affecting our software license
revenue results.

     Economic conditions have negatively impacted the demand for our MERCHANDISE
MANAGEMENT SYSTEMS and IN-STORE SYSTEMS over the past two years and we believe
there is still no evidence to support a sustained return to the historical
levels of activity in the transaction systems market in the near term. We did,
however, sign three new MERCHANDISE MANAGEMENT SYSTEMS licenses in fourth
quarter 2003 and five in third quarter 2003, compared to seven and three in the
fourth and third quarters of 2002, respectively. We believe the next drivers for
growth in the transaction systems market will be sustained economic improvement,
the introduction and acceptance of PORTFOLIO POINT OF SALES ("PPOS"), our
Java-based In-Store System that was commercially released in second quarter
2003, and the .Net Platform version of our MERCHANDISE MANAGEMENT SYSTEMS, which
is still under development, that we believe will provide our customers easier
implementation of software applications in a modular format and lower total cost
of ownership (see "We Continue to Invest in New Product Development and Have
Expanded Our Markets"). Industry surveys indicate that point-of-sales systems
are becoming an increased priority for retailers. We believe the long-term
prospects for our new PPOS product and In-Store Systems sales are promising, in
part because we are positioned to take advantage of any replacement cycle for
point-of-sales systems driven by a shift to new technology platforms.

     Our Competitive Environment is Changing.  The pace of consolidation in our
industry continues to accelerate and we believe there is a continuing trend
towards fewer, larger software vendors. As a result of this consolidation, we
could face competition from large, multi-industry technology companies that have
historically not offered an enterprise solution set to the retail supply chain
market. We believe the JDA Portfolio provides a competitive advantage as it
offers the broadest integrated enterprise solution set in the

                                        18


retail supply chain market today and the deepest functionality in any individual
solution area, particularly in those functional areas that are of greatest
interest to retailers in the current economic environment. Since 2001, the
majority of our software license revenues have been associated with our
STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS that are less disruptive, have a
higher ROI and shorter implementation timeframes. None of our competitors have a
comprehensive solution set equivalent to our STRATEGIC MERCHANDISE MANAGEMENT
SOLUTIONS. We also believe existing and potential customers are exhibiting an
increased desire to purchase solutions from a single vendor that provides an
integrated enterprise solution set rather than dealing with multiple smaller
point solution vendors.

     We believe decisions to purchase information technology are currently being
driven by the competitive nature of the retail industry. As a result, we believe
retailers may be taking the opportunity now to invest in technologies that will
differentiate them from their competitors and position them for improved
performance without significant increases in market share. We also believe that
many of our customers now view JDA as a long-term solution provider with the
ability to provide the kind of business solutions partnership for which they're
looking. In 2003, 70% of our software license revenues came from existing
customers compared to 64% in 2002.

     We believe this trend will continue and that this metric is a direct result
of our large customer base, principally amassed through our acquisition
activities in 2000 and 2001, and the focus we have and will continue to place on
back-selling opportunities for JDA Portfolio products to existing customers
through our Customer Value Program. Over the past three years, the addition of
STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS such as PORTFOLIO SPACE MANAGEMENT BY
INTACTIX and PORTFOLIO REPLENISHMENT BY E3 to the JDA Portfolio have provided
significant back-selling opportunities in our customer base. The majority of our
customers still only own one JDA product.

     Our Business Segment Revenue Mix is Changing.  The In-Store Systems
business segment provided 7% of our total revenues in 2003 compared to 12% in
2002. PPOS, our Java-based In-Store System, was commercially released in second
quarter 2003 and we are in the early adopter phase for this new platform. We do
not believe the In-Store Systems business segment will grow until early adopters
of the PPOS application complete their implementations and become
reference-able. Industry surveys indicate that point-of-sales systems are
becoming an increased priority for retailers. We believe the long-term prospects
for our new PPOS product and In-Store Systems sales are promising, in part
because we are positioned to take advantage of any replacement cycle for
point-of-sales systems driven by a shift to new technology platforms. In
addition, we have recently supplemented this business segment with the
acquisition of Timera Retail Solutions on January 29, 2004. Timera provides work
force management and labor scheduling applications for retailers that will
enhance our ability to provide efficiencies in the store environment. Scott D.
Hines, our Senior Vice President, Chief Technology Officer, has assumed
additional responsibilities and will focus on the development of the In-Store
Systems business segment during 2004.

     The Collaborative Solutions business segment, which includes sales of
software licenses and services to customers outside our traditional retail
market, provided 23% of our total revenues in 2003 compared to 20% in 2002. Our
collaborative specific solutions enable retailers and their suppliers to
optimize the sharing of plans, information and supply chain decisions between
trading partners in such areas of inventory replenishment, marketing/promotions,
sales planning/execution and category management. As of December 31, 2003, there
were approximately 200 trading partners worldwide live and operational on our
MARKETPLACE REPLENISHMENT CPFR solution that enables manufacturers, distributors
and retailers to work from a single, shared demand forecast. Beginning in
mid-2002, licenses on the MARKETPLACE REPLENISHMENT CPFR solution have been sold
on a subscription basis. We have identified the Collaborative Solutions business
segment as a growth area and will add a Senior Vice President position in 2004
specifically focused on developing this business.

     Service Revenues Continue to Decline and We Have Taken Steps to Improve Our
Service Margins. Service revenues, which include consulting services, training
revenues and reimbursed expenses, decreased 19% in 2003 compared to 2002,
primarily due to a decrease in demand for the implementation of MERCHANDISE
MANAGEMENT SYSTEMS and IN-STORE SYSTEMS. We believe retailers have changed their
buying behavior and that this has resulted in a fundamental shift in the mix of
demand for the various types of products we sell

                                        19


from longer, high dollar infrastructure type projects typically associated with
our MERCHANDISE MANAGEMENT SYSTEMS and IN-STORE SYSTEMS, to our STRATEGIC
MERCHANDISE MANAGEMENT SOLUTIONS that are less disruptive, have a higher ROI,
shorter implementation timeframes and a lower total cost of ownership. We also
believe the average implementation times for our software products have
shortened due to increased training and expertise in our consulting
organization, and as a direct result of the investments we have made over the
past few years to increase the functionality, stability, scalability,
integration and ease of implementation of the products in the JDA Portfolio.
Furthermore, since 2001 the majority of our product demand has been associated
with our STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS that require lower levels of
services to implement, and as a result, it is harder to attain optimum
productivity from our consulting staff. The preponderance of the business in the
near term software sales pipeline continues to be for STRATEGIC MERCHANDISE
MANAGEMENT SOLUTIONS. We believe implementation timeframes will continue to
shorten and as a result, our service organization will need to become more
efficient while being deployed on multiple short projects instead of more
focused longer-term engagements.

     Service revenue margins were 15% in 2003 compared to 25% in 2002. The
decrease resulted from decreased utilization and the resulting lower service
revenues, as well as a change in our incentive compensation programs for
services personnel to be related in part to software license revenue sales. The
effect of lower service revenues and higher incentive compensation on our
service margins was offset in part by a 17% decrease in average consulting
services headcount, a $3.2 million decrease in employee costs in 2003 compared
to 2002 related to consulting services employees who were used to supplement new
product development and quality assurance activities, and to assist with
business development and client support activities under the Customer Value
Program, and a $1.3 million decrease in occupancy costs.

     We have taken various actions to address the profitability of our
consulting services business. We believe these changes will result in gradually
improving service margins during 2004. Specifically, we have implemented changes
in the incentive compensation programs of our consultants, increased billing
rates on new consulting engagements, and are in the process of restructuring the
way we deliver services. The 2003 incentive compensation program for our
consultants contained annual software revenue accelerators that resulted in a
higher rate of variable compensation being earned during the last half of 2003.
The accelerators in 2004 compensation model are tied to quarterly rather than
annual software revenue results. This will avoid a mismatch between consulting
revenues and related costs as the year progresses. In addition, beginning in
fourth quarter 2003, we increased billing rates on new consulting engagements.
We expect our realized rates to trend upward during 2004 as we complete work
under existing customer billing rate commitments. Finally, we are in the process
of restructuring the way we deliver our consulting services in order to leverage
web-based technology. This will allow our consultants to provide more services
without the need to travel to the customer's site. We believe this will allow
customers to benefit from a reduction in their overall expenses, and reduce the
disruptive aspects of today's shorter consulting projects by enabling our
consultants to switch from one project to the next with less downtime.

     The Implementation of the Customer Value Program Impacted Our Operating
Results.  We reorganized the Company in fourth quarter 2002 in connection with
the implementation of the Customer Value Program ("CVP") effective January 1,
2003. Implementation of the CVP caused initial disruptions in our sales,
services and training functions that negatively impacted our revenues and
operating results in the early months of 2003. The most significant negative
impact of the CVP implementation is behind us and we believe the transition has
been completed. CVP was designed to (i) refocus the organization on delivering
value to our existing customer base, (ii) strengthen our competitive position,
(iii) improve the quality, satisfaction and efficiency of our customers'
experience with JDA, (iv) increase revenues, (v) better align our cost
structure, and (vi) improve our operating results. We believe many of these
goals are being met, and that the CVP may have resulted in various invitations
from customers in recent quarters to participate in their strategic business
development activities. The next phase of the CVP will focus on the execution of
back-selling opportunities in our customer base since the majority of our
customers still only own one JDA product.

     We recorded a $5.0 million restructuring charge in fourth quarter 2002 for
the workforce reduction and office closure costs to reorganize the Company in
connection with the implementation of the CVP. In addition, we have incurred
$2.2 million in relocation costs through December 31, 2003, including $1.8
million

                                        20


and $452,000 in 2003 and 2002, respectively, to consolidate our development and
client support activities at our corporate headquarters. The relocation costs
have been reported in income from continuing operations as incurred.

     We Continue to Invest in New Product Development and Have Expanded Our
Markets.  We invested $56.0 million in 2003, and approximately $292.0 million
from 1998 to 2002 in new product development and the acquisition of
complementary products. The acquisitions of Intactix, Zapotec, NeoVista Decision
Series, E3, Vista, Engage and Timera have expanded our product offerings, and
provided us with collaborative applications that address new vertical market
opportunities with the manufacturers and wholesalers who supply our traditional
retail customers. We believe our strategy of expanding our product portfolio and
increasing the scalability of our products has been the key element in
attracting larger retail customers, and we believe that it has resulted in a
steady pattern of new customers licensing multiple products, as well as enhanced
back-selling opportunities in our customer base.

     We are developing a series of enhancements to the JDA Portfolio products,
based upon the Microsoft .Net technology platform (".Net Platform") and the Java
platform, that we believe will position us uniquely in the retail and
collaborative solutions markets. Our goals are to ensure that our solutions
offer: (i) increased ease of use, (ii) increased integration of business
processes, (iii) reduced cost of ownership, (iv) faster implementation, and (v)
faster return on investment. We believe our next generation technology will
enhance our competitive position since we will be able to offer significant
features and functionality using an advanced technology platform. Our goal is to
begin delivering applications on the .Net Platform in third quarter 2004,
starting with PORTFOLIO REPLENISHMENT BY E3, followed by PORTFOLIO PLANNING BY
ARTHUR, and certain of our INTELLECT applications. This is a significant
investment by the Company as we are building our next generation of products,
while at the same time, we continue development efforts on our existing products
and complete the integration of acquired products. In addition, we announced the
commercial availability of PPOS, our Java-based In-Store System in second
quarter 2003 and currently plan to deliver JDA Portfolio 2004, a fully
synchronized, integrated release of all our existing products, in first quarter
2004.

     During second quarter 2003 we announced a JDA PORTFOLIO INVESTMENT
PROTECTION PROGRAM that provides existing customers with an upgrade path to the
new .Net Platform, if and when available, at no additional license fee under the
following conditions: (i) licensee is a current maintenance paying customer on
their existing JDA applications, (ii) licensee is not in breach of any terms of
their agreements, (iii) the version of the product that will run on the .Net
platform has no more than minimal differences in price, features, and
functionality from the licensee's existing JDA applications, and (iv) the
licensee relinquishes all rights to use previously licensed software under the
terms of the platform transfer right following a reasonable transition period.
If, however, the version of the product that will run on the .Net platform has
more than minimal differences in price, features, and functionality, licensee
may still exercise this right provided they agree to pay an additional fee equal
to the price that would be charged to other existing users of licensee's current
products to migrate to the new .Net Platform. Customers will pay any required
third party charges associated with the new platform.

     We expect to invest approximately $13.0 million per quarter in product
development in the first half of 2004 to complete our .Net launch initiatives.
We may adjust this spending rate in the second half of 2004 depending upon the
outlook for IT spending and other product specific delivery requirements.

     We Continue to Grow Our Business Through Acquisitions.  We believe there
are opportunities to grow our business through the acquisition of complementary
and synergistic companies, products and technologies. We look for acquisitions
that can be readily integrated and accretive to earnings, although we may pursue
smaller non-accretive acquisitions that will shorten our time to market with new
technologies. We are primarily interested in acquiring solutions that will
increase the breadth of our JDA Portfolio offerings in the In-Store Systems and
Collaborative Solutions business segments, and believe the general size of cash
acquisitions we would currently consider to be in the $5 million to $20 million
range.

     In April 2003 we acquired substantially all the intellectual property of
Vista Software Solutions, Inc. ("Vista"), and Vista's active customer agreements
for a total cost of $4.6 million, which includes the purchase price of $3.8
million plus $780,000 in direct costs of the acquisition. Vista is a provider of
collaborative

                                        21


business-to-business software solutions that enable retailers and consumer goods
manufacturers to more efficiently synchronize and integrate data, including
product descriptions, product images, pricing and promotion information
throughout their supply and demand chains. Vista's solutions also enable
consumer goods manufacturers to manage trade promotions, minimize trade
deductions costs and more accurately forecast product demand. With this
acquisition, we have expanded the JDA Portfolio with complementary software
products that leverage the Microsoft .Net Platform and address the critical need
for server-to-server data synchronization in Internet-based collaborative
commerce. The acquisition was accounted for as a purchase, and accordingly, the
operating results of Vista have been included in our consolidated financial
statements from the date of acquisition. In connection with the Vista
acquisition, we added 13 new employees, primarily in product development, and
recorded $229,000 of goodwill in our Retail Enterprise Systems reporting unit,
$2.1 million of goodwill in our Collaborative Solutions reporting unit, $1.1
million in software technology, and $1.2 million for customer lists and other
intangibles. Vista contributed $1.2 million in total revenues during 2003,
including $275,000 in software license revenues and $752,000 in maintenance
services revenue, and added $1.5 million in expense. Pro forma operating results
have not been presented, as the acquisition is not material to our consolidated
financial statements.

     In August 2003 we acquired substantially all the remaining assets of
Engage, Inc. ("Engage") for a total cost of $3.5 million, which includes the
cash purchase price of $3.0 million plus $468,000 in direct costs of the
acquisition. Engage is a provider of enterprise advertising, marketing and
promotion software solutions that improve a retailer's promotion planning
process and their delivery of marketing and advertising content. Engage's
advanced digital asset, content management and ad layout capabilities will merge
with our existing PORTFOLIO REVENUE MANAGEMENT and PORTFOLIO KNOWLEDGE BASE
applications to further expand our JDA Portfolio with functionality that
streamlines the communication and collaboration among a retailer's
merchandising, promotions, production and store operation teams. The acquisition
was accounted for as a purchase, and accordingly, the operating results of
Engage have been included in our consolidated financial statements from the date
of acquisition. In connection with the Engage acquisition, we added 31 new
employees, approximately half of which are in product development, and recorded
$306,000 of goodwill in our Retail Enterprise Systems reporting unit, $2.2
million in software technology, and $2.1 million for customer lists. Engage
contributed over $2.1 million in total revenues during 2003, including $908,000
in maintenance services revenues and $1.1 million in service revenues, and added
$2.2 million in expense. Pro forma operating results have not been presented, as
the acquisition is not material to our consolidated financial statements.

     On January 29, 2004 we acquired the intellectual property and certain other
assets of Timera Retail Solutions ("Timera"), for a total cost of $14.2 million,
which includes the purchase price of $13.0 million plus $1.2 million in direct
costs of the acquisition. Timera is a provider of integrated workforce
management solutions for the retail and consumer goods industry. Timera's
Enterprise Workforce Management product suite will expand our JDA Portfolio and
complement our existing IN-STORE SYSTEMS with web-based functionality for labor
scheduling and budgeting, time and attendance, demand forecasting, labor
tracking, and other key processes for proactive store level labor management.
The acquisition will be accounted for as a purchase, and accordingly, the
operating results of Timera will be included in our consolidated financial
statements from the date of acquisition. In connection with the Timera
acquisition, we have extended employment offers to 51 former Timera employees,
approximately two-thirds of which are in product development. The final purchase
price allocation has not been completed, however we currently expect to record
approximately $9.0 million of goodwill in our In-Store Systems reporting unit,
$4.6 million in software technology, and $1.1 million for customer lists. Pro
forma operating results will not be presented as the acquisition is not material
to our consolidated financial statements.

     Our Financial Position is Strong and We Have Positive Operating Cash
Flow.  We continue to maintain a strong financial position during the difficult
economic cycle of the last few years. As of December 31, 2003, we had $115
million in cash, cash equivalents and marketable securities, and no debt. In
addition, during 2003 we generated $20.8 million in positive cash flow from
operations. Subsequent to December 31, 2003, we purchased our corporate office
facility for $23.8 million in cash. This transaction closed on February 5, 2004.
We believe this purchase will result in a $1.2 million to $1.5 million net
reduction in our annual operating

                                        22


costs. We also utilized $13.0 million in cash to purchase Timera (see above). We
believe our cash position is sufficient to meet our operating needs for the next
twelve months.

     Management Changes.  Hamish N. J. Brewer was promoted to Chief Executive
Officer on August 4, 2003 having served as our President since April 2001 and as
a senior officer of the Company since 1996. He succeeds James D. Armstrong who
will continue as Chairman of the Board. As Chairman, Mr. Armstrong will retain
his active leadership role, focusing on strategic planning, merger and
acquisition opportunities, major product decisions and key customer
relationships. Scott D. Hines, our Senior Vice President, Chief Technology
Officer, has assumed additional responsibility and will focus on the development
of the In-Store Systems business segment during 2004. Christopher J. Moore was
promoted to Senior Vice President, Customer Support Systems in January 2004
having served in various positions with the Company for over 12 years including
Vice President, US Consulting Services from August 1999 to December 2003. David
R. King joined the Company in January 2004 as our Senior Vice President, Product
Development (see "Item 10. Directors and Executive Officers of the Registrant").
We have identified the Collaborative Solutions business segment as a growth area
and will add a Senior Vice President position in 2004 specifically focused on
developing this business.

                                        23


RESULTS OF OPERATIONS

     The following table sets forth certain selected financial information
expressed as a percentage of total revenues for the periods indicated and
certain gross margin data expressed as a percentage of software licenses,
maintenance services, product revenues or consulting services, as appropriate:



                                                                  YEAR ENDED
                                                                 DECEMBER 31,
                                                              ------------------
                                                              2003   2002   2001
                                                              ----   ----   ----
                                                                   
REVENUES:
  Software licenses.........................................   29%    31%    33%
  Maintenance services......................................   34     26     19
                                                              ---    ---    ---
     Product revenues.......................................   63     57     52
  Consulting services.......................................   34     40     45
  Reimbursed expenses.......................................    3      3      3
                                                              ---    ---    ---
     Service revenues.......................................   37     43     48
     Total revenues.........................................  100    100    100
                                                              ---    ---    ---
COST OF REVENUES:
  Cost of software licenses.................................    1      1      1
  Amortization of acquired software technology..............    2      2      2
  Cost of maintenance services..............................    8      7      5
                                                              ---    ---    ---
     Cost of product revenues...............................   11     10      8
  Cost of consulting services...............................   28     29     33
  Reimbursed expenses.......................................    3      3      3
                                                              ---    ---    ---
     Cost of service revenues...............................   31     32     36
     Total cost of revenues.................................   42     42     44
                                                              ---    ---    ---
GROSS PROFIT................................................   58     58     56
OPERATING EXPENSES:
  Product development.......................................   25     19     16
  Sales and marketing.......................................   20     18     18
  General and administrative................................   11     12     13
  Amortization of intangibles...............................    1      2      2
  Relocation costs to consolidate development and support
     activities.............................................    1     --     --
  Restructuring, asset disposition and other merger related
     charges................................................   --      3     --
  Purchased in-process research and development.............   --     --      1
  Gain on sale of office facility...........................   --     --     --
                                                              ---    ---    ---
     Total operating expenses...............................   58     54     50
                                                              ---    ---    ---
OPERATING INCOME............................................   --      4      6
  Other income, net.........................................    1      1      1
                                                              ---    ---    ---
INCOME BEFORE INCOME TAXES..................................    1      5      7
  Income tax (benefit) provision............................   --      1      2
                                                              ---    ---    ---
NET INCOME..................................................    1%     4%     5%
                                                              ===    ===    ===
Gross margin on software licenses...........................   98%    97%    97%
Gross margin on maintenance services........................   76%    75%    72%
Gross margin on product revenues............................   82%    83%    85%
Gross margin on service revenues............................   15%    25%    25%


                                        24


     The following tables set forth selected comparative financial information
on our Business Segments and geographical revenues, expressed as a percentage
change between years, for the years ended December 31, 2003 and 2002, and for
the years ended December 31, 2002 and 2001:



                         RETAIL ENTERPRISE SYSTEMS         IN-STORE SYSTEMS           COLLABORATIVE SOLUTIONS
                        ---------------------------   ---------------------------   ---------------------------
                        2003 VS 2002   2002 VS 2001   2003 VS 2002   2002 VS 2001   2003 VS 2002   2002 VS 2001
                        ------------   ------------   ------------   ------------   ------------   ------------
                                                                                 
Software licenses.....       (3)%          (16)%           (68)%         (24)%          (13)%           45%
Maintenance
  services............       16%            38%             (5)%          10%            48%            65%
                            ---            ---            ----           ---            ---            ---
  Product revenues....        6%             3%            (41)%         (13)%           16%            53%
Service revenues......      (14)%          (16)%           (50)%          (2)%           (5)%          241%
                            ---            ---            ----           ---            ---            ---
  Total revenues......       (3)%           (7)%           (47)%          (6)%           11%            75%
Product development...       16%            11%            (25)%          12%            44%            92%
Sales and marketing...       15%           (14)%           (12)%          (9)%          (14)%           83%
Operating income......      (39)%          (15)%          (108)%          (3)%            7%            37%




                               THE AMERICAS                     EUROPE                     ASIA/PACIFIC
                        ---------------------------   ---------------------------   ---------------------------
                        2003 VS 2002   2002 VS 2001   2003 VS 2002   2002 VS 2001   2003 VS 2002   2002 VS 2001
                        ------------   ------------   ------------   ------------   ------------   ------------
                                                                                 
Software licenses.....        4%           (20)%           (43)%          42%            (7)%           (7)%
Maintenance
  services............       29%            45%             47%           43%            30%            53%
                            ---            ---            ----           ---            ---            ---
  Product revenues....       16%             3%             (2)%          42%             6%             7%
Service revenues......      (32)%           (5)%            (7)%           7%             8%           (26)%
                            ---            ---            ----           ---            ---            ---
  Total revenues......       (5)%           (1)%            (4)%          26%             7%           (14)%


YEAR ENDED DECEMBER 31, 2003 COMPARED TO YEAR ENDED DECEMBER 31, 2002

     Revenues consist of product revenues and services revenue, which
represented 63% and 37%, respectively, of total revenues in 2003 compared to 57%
and 43%, respectively in 2002. Total revenues for 2003 were $207.4 million, a
decrease of $12.0 million, or 5%, from the $219.4 million reported in 2002.

     The Retail Enterprise Systems, In-Store Systems, and Collaborative
Solutions business segments represented 70%, 7%, and 23%, respectively of total
revenues in 2003, compared to 69%, 12%, and 19%, respectively in 2002.

  PRODUCT REVENUES

     Software Licenses.  Software license revenues for 2003 decreased 11% to
$59.3 million from $66.6 million in 2002.

     Retail Enterprise Systems software license revenues decreased 3% in 2003
compared to 2002. We believe this business segment was negatively impacted in
the first half of 2003 by the disruption caused by our reorganization under the
CVP, the elongation of sales cycles due to heightened risk aversion by retailers
for larger IT expenditures, and worldwide concerns about the economy and the war
in Iraq which disrupted IT spending patterns. Some of these factors have
diminished, and software license sales in the Retail Enterprise Systems business
segment increased 45% in the second half of 2003 compared to the second half of
2002.

                                        25


     In-Store Systems software license revenues decreased 68% in 2003 compared
to 2002. We believe this business segment has been negatively impacted by a
major platform transition, as market demand moves from Window-based
point-of-sale applications to Java-based point-of-sale applications. We
commercially released our PPOS Java-based point-of-sale application in second
quarter 2003 and we are currently in the early adopter phase for this new
platform. We believe the long-term prospects for this business segment are
promising, in part because we are positioned to take advantage of any
replacement cycle for point-of-sales systems driven by a shift to new technology
platforms. In addition, we have recently supplemented this business segment with
the acquisition of Timera Retail Solutions on January 29, 2004. Timera provides
work force management and labor scheduling applications for retailers that will
enhance our ability to provide efficiencies in the store environment.

     Collaborative Solutions software license revenues decreased 13% in 2003
compared to 2002. Although we experienced a decline in initial license fees in
this business segment in 2003, we began selling subscriptions on certain of our
CPFR solutions and our subscription customer base increased to approximately 200
trading partners at December 31, 2003 compared to 136 at December 31, 2002. We
believe the long-term prospects for this business segment will be enhanced by
the additional collaborative applications acquired from Vista and the
introduction of merchandise planning and category management solutions for
suppliers to retail.

     Software license revenues in the Americas increased 4% to $42.0 million in
2003 compared to $40.4 million in 2002, as a 20% increase in Retail Enterprise
Systems software license revenues was offset by decreases in software license
revenues related to In-Store Systems and Collaborative Solutions applications of
58% and 15%, respectively. The pipeline for software licenses in the Americas is
strong and the buying cycles of customers appear to have stabilized. Software
license revenues in Europe decreased 43% to $11.2 million in 2003 compared to
$19.7 million in 2002 due to decreases in software license revenues related to
Retail Enterprise Systems, In-Store Systems, and Collaborative Solutions
applications of 48%, 89%, and 6%, respectively. Our results in the European
region have been impacted by weak economic conditions, operational issues and
the departure of the regional vice president in fourth quarter 2003. Software
license revenues in Asia/Pacific decreased 7% to $6.1 million in 2003 compared
to $6.6 million in 2002 due to decreases in software license revenues related to
In-Store Systems and Collaborative Solutions applications of 57% and 6%,
respectively, offset in part by a 4% increase in Retail Enterprise Systems
software license revenues. This Asia/ Pacific region has been impacted by a slow
economic recovery and the SARS outbreak in early 2003.

     Maintenance Services.  Maintenance services revenue increased 24% to $71.1
million in 2003 from $57.6 million in 2002, primarily due to increases in the
customer base for STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS. In addition, the
increase includes $752,000 and $908,000 in incremental maintenance services
revenue from the Vista and Engage acquisitions, respectively. Maintenance
services revenue increased in our Retail Enterprise Systems and Collaborative
Solutions business segments due to continued increases in our install base.
Maintenance services revenue decreased in our In-Store Systems business segment
due to attrition that we believe results from the transitional period
surrounding the introduction and acceptance of PPOS, our Java-based In-Store
System. Many of our In-Store Systems customers have developed their own internal
support teams. We believe a portion of these customers have opted to discontinue
maintenance and remain on their existing systems in the near term, rather than
incur potentially large system upgrade, training and hardware costs at this
time.

  SERVICE REVENUES

     Service revenues, which include consulting services, training revenues, and
reimbursed expenses, decreased 19% to $77.0 million in 2003 compared to $95.3
million in 2002, primarily due to a decrease in demand for the implementation of
MERCHANDISE MANAGEMENT SYSTEMS and IN-STORE SYSTEMS which typically have higher
implementation requirements than our STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS.
We believe that service revenues will continue to decline as a percentage of our
overall revenues, due in part to our transition to the new technology platforms
that utilize component-based architecture and allow for quicker implementation
on most products that we sell.

                                        26


     Fixed bid consulting services work represented 14% of total consulting
services revenue in 2003, compared to 13% in 2002.

  COST OF PRODUCT REVENUES

     Cost of Software Licenses.  Cost of software licenses was $1.3 million, or
2% of software license revenues in 2003 compared to $2.0 million, or 3% of
software license revenues in 2002. The decrease in cost of software licenses
results from the lower volume of software products sold in 2003 that incorporate
functionality from third party software providers and require the payment of
royalties.

     Amortization of Acquired Software Technology.  Amortization of acquired
software technology was $4.5 million in 2003 compared to $4.2 million in 2002.
The increase results from the amortization of software technology acquired in
the acquisitions of Vista in second quarter 2003 and Engage in third quarter
2003.

     Cost of Maintenance Services.  Cost of maintenance services increased 22%
to $17.4 million, or 24% of maintenance services revenue, in 2003 from $14.3
million, or 25% of maintenance services revenue, in 2002. The increase results
primarily from a 7% increase in average maintenance services headcount to
support our growing customer base, and increased salaries, benefits and
incentive compensation, travel and training costs per employee.

  COST OF SERVICE REVENUES

     Cost of service revenues decreased 9% to $65.1 million in 2003 from $71.5
million in 2002. This decrease results primarily from a 17% decrease in average
consulting services headcount, a $3.2 million decrease in employee costs in 2003
compared 2002 related to consulting services employees who were used to
supplement new product development and quality assurance activities, and to
assist with business development and client support activities under the CVP,
and a $1.3 million decrease in occupancy costs. These decreases were offset in
part by salary increases, and higher benefits and incentive compensation.

  GROSS PROFIT

     Gross profit decreased 6% to $119.1 million, or 57% of total revenues in
2003, from $127.4 million, or 58% of total revenues in 2002. The decrease in
gross profit dollars and gross margin percentage results primarily from
decreases in software license and service revenues of 11% and 19%, respectively,
offset in part by a 24% increase in maintenance services revenue. Software
licenses and maintenance services revenue have substantially higher margins than
service revenues.

     Service revenue margins were 15% in 2003 compared to 25% in 2002. The
decrease resulted from decreased utilization and the resulting lower service
revenues, as well as a change in our incentive compensation programs for
services personnel to be related in part to software license revenue sales. The
effect of lower service revenues and higher incentive compensation on our
service margins was offset in part by a 17% decrease in average consulting
services headcount, a $3.2 million decrease in employee costs in 2003 compared
2002 related to consulting services employees who were used to supplement new
product development and quality assurance activities, and to assist with
business development and client support activities under the CVP, and a $1.3
million decrease in occupancy costs. We have taken steps to improve our service
revenue margins in 2004, including revisions to the incentive compensation
programs, increased billing rates on new consulting engagements, and
restructuring the way we deliver our consulting services in order to leverage
web-based technology and enhance productivity. We believe these changes will
result in gradually improving service margins during 2004.

  OPERATING EXPENSES

     Operating expenses, excluding amortization of intangibles, relocation costs
to consolidate development and support activities, restructuring, asset
disposition and other merger related charges, purchased in-process research and
development, and gain on sale of office facility, increased 4% to $113.6
million, or 55% of total revenues, in 2003, compared to $108.7 million, or 50%
of total revenues in 2002. Operating expenses increased

                                        27


primarily as a result of our investment in product development related to the
acquisitions of Vista and Engage and to migrate the JDA Portfolio to the .Net
Platform and to introduce our PPOS Java-based store system. In addition, we
incurred increases in salaries, health insurance benefit costs and incentive
compensation per employee in 2003, and $1.1 million higher D&O insurance
premiums. These increases were offset in part by a $2.4 million lower provision
for doubtful accounts, a $1.1 million favorable swing in customer dispute
activity and decreases in occupancy, marketing, legal, accounting and investor
relation costs.

     Product Development.  Product development expenses for 2003 increased 16%
to $48.5 million from $41.8 million in 2002. Product development expense, as a
percentage of product revenues, was 37% in 2003 compared to 34% in 2002. The
increase in product development during 2003 includes increases in average
headcount, annual salary increases, and higher incentive compensation costs for
full-time employees involved in the ongoing development of a series of
enhancements to the JDA Portfolio products based upon the .Net Platform, higher
outside contractor costs, and product development employees added through the
acquisitions of Vista and Engage. The migration of the JDA Portfolio to the .Net
Platform is a significant investment by the Company as we are building our next
generation of products, while at the same time, we continue development efforts
on our existing products and complete the integration of acquired products. In
addition, product development expenses increased $1.3 million during 2003
compared to 2002 for the use of consulting services employees to supplement the
new product development and quality assurance activities of our internal
developers.

     Sales and Marketing.  Sales and marketing expenses for 2003 increased 4% to
$41.6 million from $39.9 million in 2002. Sales and marketing expense, as a
percentage of total revenues, was 20% in 2003 compared to 18% in 2002. Sales and
marketing expenses increased in 2003 as a result of higher commissions and a
$1.6 million increase in costs for consulting services employees who assisted
with business development activities under the CVP, offset in part by a decrease
in marketing costs.

     General and Administrative.  General and administrative expenses for 2003
decreased 13% to $23.5 million from $27.0 million in 2002. General and
administrative expense, as a percentage of total revenues, was 11% in 2003
compared to 12% in 2002. The decrease in general and administrative expenses
results primarily from a $2.4 million lower provision for doubtful accounts,
decreases in legal, accounting and investor relation costs, and a $1.1 million
favorable swing in customer dispute activity, offset in part by higher D&O
insurance premiums, and increases in annual salaries, benefits and incentive
compensation.

     Amortization of Intangibles.  Amortization of intangibles was $3.1 million
in 2003 compared to $2.8 million in 2002. The increase results from the
amortization of customer list intangibles acquired in the acquisitions of Vista
in second quarter 2003 and Engage in third quarter 2003.

     Relocation Costs to Consolidate Development and Client Support
Activities.  Approximately 150 people were offered the opportunity to relocate
as part of the CVP initiative to consolidate our development and client support
activities at our corporate headquarters. As of December 31, 2003, a total of 50
employees have relocated. We negotiated temporary retention arrangements ranging
from nine months to two years with 42 employees who have chosen not to relocate
in order to facilitate a smooth transition. We have subsequently offered
indefinite full-time employment to 19 of these employees, who we believe are
strategic to our current development efforts, and rescinded their retention
arrangements. We have incurred $2.2 million in relocation costs through December
31, 2003, including $1.8 million and $452,000 in 2003 and 2002, respectively, to
consolidate our development and client support activities at our corporate
headquarters. The relocation costs have been reported in income from continuing
operations as incurred.

     Restructuring, Office Closure Costs and Other Charges.  We recorded a $1.3
million restructuring charge in second quarter 2002. The restructuring
initiatives involved a workforce reduction of 53 full-time employees, primarily
in the consulting services function in the United States, Europe, Canada and
Latin America. All workforce reductions associated with this charge were made on
or before June 30, 2002. In fourth quarter 2002, we recorded another
restructuring charge of $5.0 million for termination and office closure costs
associated with the reorganization of the Company to implement the CVP
initiative. All employees potentially impacted by this reorganization initiative
were notified of the plan of termination and the related benefits on or

                                        28


before December 31, 2002. Office closure costs pertain to certain US, Latin
America, and European offices that were either under-performing or became
redundant with the relocation initiatives.

     Purchased In-process Research and Development.  We expensed $800,000 of
purchased in-process research and development in 2002 in connection with the
acquisition of J -- Commerce in April 2002.

     Gain on Sale of Office Facility.  We realized a $639,000 gain in second
quarter 2003 on the sale of an excess office facility in the United Kingdom.

  OPERATING INCOME

     Operating income was $1.3 million in 2003 compared to operating income of
$8.3 million in 2002. The decrease in operating income results primarily from
decreases in software licenses and service revenues of 11% and 19%, respectively
in 2003 compared to 2002, a $6.7 million increase in product development costs,
and higher incentive compensation, offset in part by a 24% increase in
maintenance services revenues, a $2.4 million lower bad debt provision, 115 or
8% fewer average full-time employees, $4.9 million lower restructuring and
relocation costs, and a $639,000 gain on the sale of an excess office facility.

     Operating income in our Retail Enterprise Systems business segment
decreased 39% to $18.2 million in 2003 from $29.8 million in 2002. The decrease
results primarily from a decrease in software license revenues, lower service
revenues and margins, an increase in product development costs due to
development activities on the .Net Platform and new releases of our STRATEGIC
MERCHANDISE MANAGEMENT SOLUTIONS, and an increase in sales and marketing costs,
primarily as a result of higher commissions, offset in part by an increase in
maintenance services revenue.

     We incurred an operating loss of $405,000 in our In-Store Systems business
segment in 2003 compared to operating income of $5.3 million in 2002. The
decrease results from lower product and services revenues in this business
segment in 2003 compared to 2002, offset in part by headcount reductions in
consulting services, a reduced investment in product development, and lower
sales commissions.

     Operating income in our Collaborative Solutions business segment increased
7% to $11.2 million in 2003 from $10.5 million in 2002. The increase results
primarily from an increase in maintenance services revenues due to an increased
customer base, and a decrease in sales and marketing costs, offset in part by
lower software licenses and service revenues, and an increase in product
development headcount to support the development activities on the .Net platform
and new product initiatives for the future growth of this business segment.

  PROVISION FOR INCOME TAXES

     We recorded an income tax benefit of $17,000, or 1% of the reported income
before income taxes in 2003 compared to a provision for income taxes of $1.0
million, or 10.4% of income before income taxes in 2002. The income tax benefit
for 2003 includes a one-time tax benefit of $938,000. In 2002, we established a
valuation allowance of $3.5 million for foreign tax credit carryovers due to our
excess credit position. We subsequently elected in third quarter 2003 to
capitalize a significant portion of our research and development costs in the
2002 federal income tax return, which allowed us to more fully utilize certain
tax credits that could not previously be realized. With this election, we
reversed $2.3 million of the previously recorded valuation allowance, which
resulted in the one-time tax benefit of $938,000, an increase to additional paid
in capital of $1.1 million, and an increase in income taxes payable of $262,000.
The effective income tax rate for 2003, excluding the effect of the $938,000
one-time tax benefit, is 35%.

     The provision for income taxes in 2002 includes $1.9 million in one-time
tax benefits related primarily to the resolution of an audit by the Inland
Revenue of our United Kingdom subsidiaries for the years 1997 through 2000, and
the settlement in the United States of an income tax examination by the Internal
Revenue Service of our 1998 and 1999 federal income tax returns. Under the
settlement, the Internal Revenue Service has agreed to allow the Company to take
a research and development expense tax credit for most of the qualifying
expenses originally reported in the 1998 and 1999 federal income tax returns.
However, the Internal Revenue Service has advised that they cannot issue a
refund check until they complete a subsequent audit of our 2000 and 2001 federal
income tax returns. This audit is expected to be completed within six months of

                                        29


December 31, 2003 and no material adjustments are anticipated. The effective
income tax rate for 2002, excluding the effect of the $1.9 million one-time tax
benefits, is 35.5%.

     The provisions for 2003 and 2002 take into account the source of taxable
income, domestically by state and internationally by country, and available
income tax credits. The provisions for 2003 and 2002 do not include the tax
benefits realized from the employee stock options exercised during these years
of $777,000 and $5.8 million (net of a $1.0 million valuation allowance),
respectively. These tax benefits reduce our income tax liabilities and are
included as an increase to additional paid-in capital.

YEAR ENDED DECEMBER 31, 2002 COMPARED TO YEAR ENDED DECEMBER 31, 2001

     Product revenues and services revenue represented 57% and 43%,
respectively, of total revenues in 2002 compared to 52% and 48%, respectively in
2001. Total revenues for 2002 were $219.5 million, an increase of $5.6 million,
or 3%, over the $213.8 million reported in 2001. Excluding the impact of owning
E3 for eight more months in 2002 than in 2001, product revenues, consulting
services revenues, and total revenues decreased 8%, 15% and 11%, respectively in
2002 compared to 2001.

  PRODUCT REVENUES

     Software Licenses.  Software license revenues for 2002 decreased 6% to
$66.6 million from $71.2 million in 2001. Excluding the impact of owning E3 for
eight more months in 2002 than in 2001, software license revenues decreased 23%
in 2002 compared to 2001. The retail industry appeared to remain cautious with
their level of investment in information technology during the difficult
economic cycle we experienced in 2002, perhaps due to poor macroeconomic
conditions, and uncertainty related to the threat of future terrorist attacks
and a US war with Iraq. In addition, subsequent to the September 11 attack and
the ensuing deterioration in economic conditions, we believe retailers changed
their buying behavior and this resulted in a fundamental shift in the mix of
demand for the various types of products we sell away from high dollar projects
toward lower cost point solutions. Software license revenues in the Retail
Enterprise Systems business segment, excluding the impact of owning E3 for eight
more months in 2002 than in 2001, decreased 28% in 2002 compared to 2001.
In-Store Systems software license revenues decreased 24% in 2002 compared to
2001. Collaborative Solutions software license revenues, excluding the impact of
owning E3 for eight more months in 2002 than in 2001, decreased 2% in 2002
compared to 2001.

     Software license revenues in the Americas decreased 20% in 2002 compared to
2001. Excluding the impact of owning E3 for eight more months in 2002 than in
2001, software license revenues in the Americas decreased 35% in 2002 compared
to 2001. This decrease resulted primarily from a 44% decrease in software
license revenues related to Retail Enterprise Systems and a 57% decrease in
In-Store Systems applications, offset in part by a 37% increase in software
license revenues from our Collaborative Solutions products. Software license
revenues in Europe increased 42% in 2002 compared to 2001. Excluding the impact
of owning E3 for eight more months in 2002 than in 2001, software license
revenues in Europe increased 14% in 2002 compared to 2001. Software license
revenues in Asia/Pacific decreased 7% in 2002 compared to 2001. Excluding the
impact of owning E3 for eight more months in 2002 than in 2001, software license
revenues in Asia/Pacific decreased 10% in 2002 compared to 2001.

     Maintenance Services.  Maintenance services revenue for 2002 increased 42%
to $57.6 million from $40.6 million in 2001. Excluding the impact of owning E3
for eight more months in 2002 than in 2001, maintenance services revenue
increased 19% in 2002 compared to 2001 due to increases in the install base for
our other product lines.

  CONSULTING SERVICES

     Consulting services revenue, including the reclassification of reimbursed
expenses, decreased 7% in 2002 to $95.3 million from $102.0 million in 2001.
Excluding the impact of owning E3 for eight more months in 2002 than in 2001,
consulting services revenue decreased 15% in 2002 compared to 2001, primarily
due to a decrease in demand for the implementation of MERCHANDISE MANAGEMENT
SYSTEMS and other large projects. Consulting services revenue typically lags the
sale of software licenses by as much as one year. In addition, we

                                        30


believe the average implementation times for our software products declined due
to increased training and expertise in our consulting organization, and as a
direct result of the investments we made over the past few years to increase the
functionality, stability, scalability, integration and ease of implementation of
the products in the JDA Portfolio. Furthermore, in 2002 more of the demand for
our products was associated with our analytic and optimization products that
require lower levels of services to implement. As a result of these changes in
our business and product revenue mix, our consulting services revenue declined
sequentially in each of the four fiscal quarters of 2002.

  BUSINESS SEGMENT REVENUES

     Total revenues in our Retail Enterprise Systems business segment decreased
7% to $151.1 million in 2002 from $162.3 million in 2001. Excluding the impact
of owning E3 for eight more months in 2002 than in 2001, total revenues in this
business segment decreased 17% in 2002 compared to 2001, primarily due to a
decline in demand for MERCHANDISE MANAGEMENT SYSTEMS. Sales of MERCHANDISE
MANAGEMENT SYSTEMS tend to be more heavily impacted during slow economic
periods, as retailers are often reluctant to make substantial investments due to
the slower expected return on investment. In addition, these products typically
have longer implementation time frames and our services group often performs the
implementation services. As a result, the decline in software sales for these
products also had a negative impact on our consulting services revenue. The
Retail Enterprise Systems business segment represented 69% of our total revenues
in 2002 compared to 76% in 2001.

     Total revenues in our In-Store Systems business segment decreased 6% to
$25.5 million in 2002 from $27.1 million in 2001, primarily due to a 9% decrease
in WIN/DSS revenues, offset in part by a 64% increase in revenues from the STORE
PORTAL application. In-Store Systems such as WIN/DSS tend to be heavily impacted
during slower economic periods, as the implementation of a new point-of-sale
system usually requires a substantial hardware investment. The In-Store Systems
business segment represented 12% of total revenues in 2002 compared to 13% in
2001.

     Total revenues in our Collaborative Solutions business segment increased
75% to $42.9 million in 2002 from $24.5 million 2001. Excluding the impact of
owning E3 for eight more months in 2002 than in 2001, total revenues in this
business segment increased 24% in 2002 compared to 2001 primarily due to an
increase in PORTFOLIO SPACE MANAGEMENT revenues from non-retail customers. The
Collaborative Solutions business segment represented 19% of total revenues in
2002 compared to 11% in 2001.

  GEOGRAPHIC REVENUES

     Total revenues in the Americas decreased 1% to $142.2 million in 2002 from
$143.7 million in 2001. Excluding the impact of owning E3 for eight more months
in 2002 than in 2001, total revenues in this region decreased 15% in 2002
compared to 2001, due to a 35% decrease in software license revenues and a 13%
decrease in consulting services revenues, offset in part by an 18% increase in
maintenance services revenue.

     Total revenues in Europe increased 26% to $59.6 million in 2002 from $47.3
million in 2001. Excluding the impact of owning E3 for eight more months in 2002
than in 2001, total revenues in this region increased 7% in 2002 compared to
2001 due to a 14% increase in software license revenues and a 14% increase in
maintenance services revenue, offset in part by a 2% decrease in consulting
services revenue.

     Total revenues in Asia/Pacific decreased 14% to $21.4 million in 2002 from
$24.8 million in 2001. Excluding the impact of owning E3 for eight more months
in 2002 compared to 2001, total revenues in this region decreased 15% in 2002
compared to 2001 due to a 10% decrease in software license revenues and a 26%
decrease in consulting services revenue primarily due to decreases in revenues
from certain large projects in Australia and Japan, offset in part by a 47%
increase in maintenance services revenue.

  COST OF PRODUCT REVENUES

     Cost of Software Licenses.  Cost of software licenses was $2.0 million, or
3% of software license revenues in 2002 compared to $2.4 million, or 3% of
software license revenues in 2001. The decrease in cost of software

                                        31


licenses dollars resulted from the lower volume of software products sold in
2002 that incorporate functionality from third party software providers and
require the payment of royalties.

     Amortization of Acquired Software Technology.  Amortization of acquired
software technology was $4.2 million in 2002 compared to $3.0 million in 2002.
The increase resulted primarily from eight more months of amortization in 2002
of software technology acquired with E3 in September 2001.

     Cost of Maintenance Services.  Cost of maintenance services increased 28%
to $14.3 million, or 25% of maintenance services revenue, in 2002 from $11.2
million, or 27% of maintenance services revenue, in 2001. The increase resulted
primarily from the acquisition of E3 in September 2001 and the additional
headcount in the customer support function to support our growing installed
client base, offset in part by lower incentive compensation costs. At December
31, 2002, we had 132 employees in the customer support function.

  COST OF SERVICES

     Cost of services decreased 7% to $71.5 million in 2002 from $76.9 million
in 2001. This decrease resulted primarily from a 7% decrease in average
consulting services headcount and lower incentive compensation costs in 2002
compared to 2001, offset in part by higher travel and training costs. At
December 31, 2002, we had 468 employees in the consulting services function.

  GROSS PROFIT

     Gross profit for 2002 increased 6% to $127.4 million, or 58% of total
revenues, from $120.5 million, or 56% of total revenues in 2001. The increase in
gross profit dollars and gross margin percentage resulted primarily from the 3%
increase in total revenues and the higher mix of product revenues as a
percentage of total revenues in 2002 compared to 2001. Software licenses and
maintenance services revenue have higher margins than service revenues.
Consulting services margins, which include the reclassification of reimbursed
expenses in both service revenues and cost of service revenues, remained flat at
25% in 2002 compared to 2001 as the impact of the decrease in average consulting
services headcount, lower incentive compensation costs and higher average
billing rates in 2002 compared to 2001 were offset by lower utilization rates.
The lower utilization rates in 2002 resulted from deteriorating economic
conditions that decreased the demand for our services, particularly from
MERCHANDISE MANAGEMENT SYSTEMS implementations and other large projects,
together with improved integration and shorter implementation timeframes of the
products in the JDA Portfolio. During second quarter 2002 we reduced our
consulting services headcount by approximately 10% in order to stem the decline
in our utilization rates, consulting margins and overall profitability with the
lower consulting services revenue outlook for 2002. During fourth quarter 2002
we reduced our consulting services headcount by another 10% in connection with
our reorganization and restructuring of the Company (See "The Implementation of
the Customer Value Program Has Impacted Our Operating Results").

  OPERATING EXPENSES

     Operating expenses, excluding amortization of intangibles, purchased
in-process research and development, restructuring, asset disposition, and other
merger related charges, and relocation costs increased 9% to $108.7 million, or
50% of total revenues, in 2002 from $99.5 million, or 47% of total revenues in
2001. Overall, our cost structure increased in 2002 compared to 2001 due to an
11% increase in average headcount and a $2.6 million increase in
employee-related costs, due primarily to the full-time employees added in
connection with the acquisitions of E3 in September 2001, NeoVista in June 2001,
and J -- Commerce in April 2002; $2.5 million in higher travel costs due to
increasing airfares and more full-time employees; and $2.8 million in higher
occupancy costs due to increased space from the E3, NeoVista and J -- Commerce
acquisitions.

     Product Development.  Product development expenses for 2002 increased 22%
to $41.8 million from $34.4 million in 2001. Product development expense as a
percentage of product revenues was 34% in 2002 compared to 31% in 2001. The
increase in product development expense resulted primarily from the cost of
full-time employees added in connection with the acquisitions of E3 in September
2001, NeoVista in June 2001, and J -- Commerce in April 2002, and the addition
of full-time employees involved in the ongoing enhancement of the JDA Portfolio
and the development of further CPFR applications, offset in part by lower

                                        32


incentive compensation costs. We also believe development of our software is
essentially completed concurrent with the establishment of technological
feasibility, and accordingly, no costs have been capitalized. At December 31,
2002, we had 351 employees in the product development function.

     Sales and Marketing.  Sales and marketing expenses for 2002 increased 5% to
$39.9 million from $38 million in 2001. Sales and marketing expense as a
percentage of total revenues was 18% in 2002, which is comparable to 2001. The
increase in sales and marketing expenses resulted from an increase in quota
carrying sales representatives, due primarily to the acquisition of E3 in
September 2001, and higher marketing and travel costs, offset in part by lower
commissions and related benefits. At December 31, 2002, we had 143 employees in
the sales and marketing function.

     General and Administrative.  General and administrative expenses for 2002
were $27 million, which is flat compared to 2001. General and administrative
expense, as a percentage of total revenues, was 12% in 2002 compared to 13% in
2001. General and administrative expense dollars remained flat year over year
due to increases that resulted from the acquisition of E3 in September 2001,
additional full-time employees and outside contractors involved in the
development and maintenance of our internal information systems, and higher
legal, accounting, insurance and travel costs due to prevailing economic
conditions, offset by lower incentive compensation costs and a $2.0 million
lower bad debt expense.

     Amortization of Intangibles.  Amortization of intangibles was $2.8 million
in 2002 compared to $5.5 million in 2001. The non-amortization provisions of
SFAS No. 142 for goodwill and trademarks with indefinite useful lives reduced
amortization expense by approximately $3.8 million in 2002, however, this was
offset in part by new amortization related to the acquisitions of NeoVista in
June 2001 and E3 in September 2001.

     Purchased In-process Research and Development.  We expensed $800,000 of
purchased in-process research and development in 2002 in connection with the
acquisition of J -- Commerce in April 2002. We expensed $2.4 million of
purchased in-process research and development in 2001 in connection with the
acquisitions of Zapotec in February 2001 ($161,000) and E3 in September 2001
($2.2 million).

     Restructuring, Asset Disposition and Other Merger Related Charges.  We
consistently monitor the impact of the economic environment on the outlook for
demand for our products and services, and make adjustments to our workforce as
necessary to maintain overall profitability. In second quarter 2002, we recorded
a $1.3 million restructuring charge for a workforce reduction of 53 full-time
employees, primarily in the consulting services function in the Americas and
Europe. All employees potentially impacted by this restructuring were notified
of the plan of termination and the related benefits on or before June 30, 2002.
In fourth quarter 2002, we recorded another restructuring charge of $5.0 million
for termination and office closure costs associated with the reorganization of
the Company to implement the CVP initiative. All employees potentially impacted
by this reorganization initiative were notified of the plan of termination and
the related benefits on or before December 31, 2002. Office closure costs
pertain to certain US, Latin America, and European offices that were either
under-performing or became redundant with the relocation initiatives.

     We recorded restructuring, asset disposition and other merger related
charges of $749,000 in first quarter 2001 and an additional $236,000 in fourth
quarter 2001 for JDA employees made redundant in the E3 acquisition. These
restructuring initiatives involved a workforce reduction of 41 full-time
employees in certain implementation service groups, product development
activities, sales and marketing, and administrative functions in the United
States, Europe, Canada and Latin America. All workforce reductions associated
with these charges were made on or before March 31, 2001 or December 31, 2001,
as appropriate. The first quarter 2001 charges also include other merger related
charges of $208,000 for the write-off of certain merger and acquisition costs
related to a potential acquisition that was abandoned.

     Relocation Costs to Consolidate Development and Support Activities.  We
incurred $452,000 in costs through December 31, 2002, in connection with CVP, to
relocate certain product development and client support services employees based
in offices around the United States and the United Kingdom to our corporate
headquarters.

                                        33


  OPERATING INCOME

     Operating income decreased 32% to $8.3 million in 2002 from $12.1 million
in 2001. The decrease in operating income resulted from decreases in software
licenses and service revenues of 6% and 7%, respectively in 2002 compared to
2001, a $5.3 million increase in restructuring charges, and a $9.2 million, or
9% increase in operating expenses, excluding amortization of intangibles,
purchased in-process research and development, restructuring charges, asset
disposition and other merger related charges, and relocation costs, offset in
part by a 42% increase in maintenance services revenue, a $1.4 million decrease
in amortization of acquired software technology and other intangibles, and a
$1.6 million decrease in purchased in-process research and development costs.

     Operating income in our Retail Enterprise Systems business segment
decreased 15% to $29.8 million in 2002 from $34.9 million in 2001. The decrease
resulted from lower total software and services revenues and increases in
product development costs and costs of maintenance services in this business
segment in 2002 compared to 2001, offset in part by higher maintenance services
revenue and decreases in sales and marketing costs and costs of consulting
services due to reduced headcounts and lower incentive compensation.

     Operating income in our In-Store Systems business segment decreased 3% to
$5.3 million in 2002 from $5.5 million in 2001. The decrease resulted from lower
software and services revenues, and increases in product development costs and
costs of maintenance services in this business segment in 2002 compared to 2001,
offset in part by higher maintenance services revenue and decreases sales and
marketing costs and costs of services due to reduced headcounts and lower
incentive compensation.

     Operating income in our Collaborative Solutions business segment increased
37% to $10.5 million in 2002 from $7.6 million in 2001. The increase resulted
primarily from increases in software license sales, maintenance services and
consulting services revenues, offset in part by increases in sales and marketing
and product development costs to support our new CPFR initiatives.

  PROVISION FOR INCOME TAXES

     The provision for income taxes was $1.0 million, or 10.4% of income before
income taxes in 2002 compared to $5.1 million, or 34.6% in 2001. The provision
for income taxes for 2002 includes $1.9 million in one-time tax benefits related
primarily to the resolution of an audit by the Inland Revenue of our United
Kingdom subsidiaries for the years 1997 through 2000, and the settlement in the
United States of an income tax examination by the Internal Revenue Service of
our 1998 and 1999 federal income tax returns. Under the settlement, the Internal
Revenue Service agreed to allow the Company to take a research and development
expense tax credit for most of the qualifying expenses originally reported in
the Company's corporate income tax returns for those years. Our effective income
tax rate takes into account the source of taxable income, domestically by state
and internationally by country, and available income tax credits. The provisions
for income taxes for 2002 and 2001 do not include the tax benefits realized from
employee stock options exercised during these years of $5.8 million (net of a
$1.0 million valuation allowance), and $907,000, respectively. These tax
benefits reduce our income tax liabilities and are included as an increase to
additional paid-in capital.

     During 2002, we established a valuation allowance of $3.5 million on
foreign tax credit carryovers because we had been operating in an excess credit
position. We charged $1.0 million of this valuation allowance to additional
paid-in capital due to the potential loss of foreign tax credits from the
exercise of employee stock options. We feel it is more likely than not that
foreign tax credits will not be realized. If, in the future, the Company
determines that it is able to utilize the foreign tax credits, a portion of the
valuation allowance reversal will be recorded to additional paid-in capital.

  LIQUIDITY AND CAPITAL RESOURCES

     We had working capital of $126.0 million at December 31, 2003 compared with
$121.0 million at December 31, 2002. Cash and marketable securities at December
31, 2003 were $114.7 million, an increase of $12.8 million over the $101.9
million reported at December 31, 2002. Cash and marketable securities balances

                                        34


increased in 2003 primarily as a result of cash provided by operating activities
and the cash received from the issuance of common stock under our stock option
and employee stock purchase plans. Working capital remained flat at December 31,
2003 compared to December 31, 2002 primarily as a result of the increase in cash
and marketable securities, an increase in the current portion of a promissory
note receivable, and a reduction in accrued expenses and other liabilities,
offset by a decrease in accounts receivable and income tax receivable, and an
increase in deferred revenue. Our net accounts receivable were $40.2 million, or
65 days sales outstanding ("DSOs") at December 31, 2003 compared to $47.1
million, or 79 DSOs at December 31, 2002. DSOs may fluctuate significantly on a
quarterly basis due to a number of factors including seasonality, shifts in
customer buying patterns, the timing of annual maintenance renewals, lengthened
contractual payment terms in response to competitive pressures, the underlying
mix of products and services, and the geographic concentration of revenues. The
significant decrease in accounts receivable balances is due primarily to lower
revenues in 2003 compared to 2002. However, collection of accounts receivable
continues to be an area of focus and the amounts outstanding greater than 90
days have decreased more than $7.0 million since December 31, 2002.

     Operating activities provided cash of $20.8 million in 2003 and $41.5
million in 2002. The decrease in cash provided from operating activities results
primarily from (i) a 5% decrease in total revenues that resulted in a $6.3
million decrease in net income in 2003 compared to 2002; (ii) a $5.0 million
decrease in the income tax benefits from the exercise of stock options and
shares purchased under the employee stock purchase plan as the average market
price of our stock was lower in 2003 compared to 2002 which resulted in fewer
options being exercised; (iii) a $267,000 decrease in deferred revenue in 2003
compared to a $6.0 million increase in 2002 which resulted primarily from the
first full year billing of maintenance on products acquired from E3; (iv) a $4.8
million smaller decrease in accounts receivable which resulted from lower total
revenues and improved collections; (v) a $3.6 million decrease in accrued
expenses and other liabilities compared to a $1.2 million increase in 2002; and
(vi) a $2.4 million lower provision for doubtful accounts. These decreases in
cash flow were partially offset by (i) a $5.0 million decrease in income tax
receivable in 2003 compared to a $2.5 million increase in 2002; (ii) a $1.0
million decrease in prepaid expenses and other current assets in 2003 compared
to a $2.2 million increase in 2002; and (iii) a $700,000 smaller decrease in
deferred income taxes due primarily to our election to capitalize a significant
portion of our research and development costs for 2002 on our federal income tax
return.

     Investing activities utilized cash of $22.8 million in 2003 and $38.9
million in 2002. Cash utilized by investing activities in 2003 results primarily
from $10.4 million in capital expenditures which includes approximately $2.2
million in costs related to the implementation of a new enterprise-wide customer
support system, the net purchase of $6.5 million of marketable securities due to
our investment of cash in excess of current operating requirements, $4.0 million
in cash expended to acquire Vista and pay direct costs related to the
acquisition, and $3.3 million in cash expended to acquire Engage and pay direct
costs related to the acquisition, offset in part by $2.0 million in proceeds
from the disposal of property and equipment, primarily from the sale of an
excess office facility in the United Kingdom. Cash utilized by investing
activities in 2002 includes the net purchase of $18.6 million of marketable
securities, the payment of $8.6 million in direct costs related to the
acquisition of E3, $4.2 million in cash expended to acquire J -- Commerce, and
$8.3 million in capital expenditures.

     Financing activities provided cash of $6.8 million in 2003 and $15.4
million in 2002. The activity in both periods includes proceeds from the
issuance of common stock under our stock option and employee stock purchase
plans. Proceeds from the issuance of common stock under our stock option plans
decreased $8.9 million in 2003 as the average market price of our stock was
lower in 2003 compared to 2002, which resulted in fewer options being exercised.
We received approximately $4.1 million in proceeds from the issuance of stock
under our 1999 Employee Stock Purchase Plan ("1999 Purchase Plan") in both 2003
and 2002. This source of cash will not recur in 2004 as we terminated the 1999
Purchase Plan in August 2003. In addition, in July 2002 our Board of Directors
authorized the repurchase of up to two million shares of our outstanding common
stock on the open market at prevailing market prices during a one-year period
ended July 22, 2003. We repurchased a total of 175,000 shares of our common
stock for $1.8 million under this program, including 75,000 shares for $757,000
in 2003 and 100,000 shares for $1.1 million in 2002.

                                        35


     Changes in the currency exchange rates of our foreign operations had the
effect of increasing cash by $1.6 million in 2003 and $1.2 million in 2002 due
to the continued weakness of the US Dollar against major foreign currencies
including the Euro and the British Pound. We currently use derivative financial
instruments, primarily forward exchange contracts, to manage a majority of the
short-term foreign currency exchange exposure associated with foreign currency
denominated assets and liabilities which exist as part of our ongoing business
operations. We do not enter into derivative financial instruments for trading or
speculative purposes. The forward exchange contracts generally have maturities
of less than 90 days, and are not designated as hedging instruments under SFAS
No. 133. Forward exchange contracts are marked-to-market at the end of each
reporting period, with gains and losses recognized in other income, net, offset
by the gains or losses resulting from the settlement of the underlying foreign
currency denominated receivables and payables.

     We believe there are opportunities to grow our business through the
acquisition of complementary and synergistic companies, products and
technologies. We look for acquisitions that can be readily integrated and
accretive to earnings, although we may pursue smaller non-accretive acquisitions
that will shorten our time to market with new technologies. We are primarily
interested in acquiring solutions that will increase the breadth of our JDA
Portfolio offerings in the In-Store Systems and Collaborative Solutions business
segments, and believe the general size of cash acquisitions we would currently
consider to be in the $5 million to $20 million range. Any material acquisition
could result in a decrease to our working capital depending on the amount,
timing and nature of the consideration to be paid. In addition, any material
acquisitions of complementary or synergistic companies, products or technologies
could require that we obtain additional equity financing. There can be no
assurance that such additional financing will be available or that, if
available, such financing will be obtained on terms favorable to us and would
not result in additional dilution to our stockholders.

     On January 29, 2004 we acquired the intellectual property and certain other
assets of Timera Retail Solutions ("Timera"), for a total cost of $14.2 million,
which includes the purchase price of $13.0 million plus $1.2 million in direct
costs of the acquisition. The acquisition will be accounted for as a purchase,
and accordingly, the operating results of Timera will be included in our
consolidated financial statements from the date of acquisition. In connection
with the Timera acquisition, we have extended employment offers to 51 former
Timera employees, approximately two-thirds of which are in product development.
The final purchase price allocation has not been completed, however we currently
expect to record approximately $9.0 million of goodwill, $4.6 million in
software technology, and $1.1 million for customer lists. Pro forma operating
results will not be presented as the acquisition is not material to our
consolidated financial statements.

     Subsequent to December 31, 2003, we purchased our corporate office facility
for approximately $23.8 million in cash. This transaction closed on February 5,
2004. The purchase includes the corporate office building, a new two-story
parking garage, and approximately 8.8 acres of land upon which these structures
are located. We believe this purchase will result in a $1.2 million to $1.5
million net reduction in our annual operating costs.

     The purchase of our corporate office facility, together with the
acquisition of Timera, utilized $36.8 million, or approximately 32% of our
December 31, 2003 cash and cash equivalents, and investments in marketable
securities balances.

     The following summarizes known contractual obligations under capital and
operating leases as of December 31, 2003:



                                                        PAYMENT DUE BY PERIOD
                                    -------------------------------------------------------------
CONTRACTUAL OBLIGATIONS              TOTAL     <1 YEAR    1 TO 3 YEARS   3 TO 5 YEARS   >5 YEARS
- -----------------------             -------   ---------   ------------   ------------   ---------
                                                           (IN THOUSANDS)
                                                                         
Capital lease obligations.........  $    82    $   82        $   --         $   --       $   --
Operating lease obligations.......   20,179     5,717         7,768          2,866        3,828
                                    -------    ------        ------         ------       ------
                                    $20,261    $5,799        $7,768         $2,866       $3,828
                                    =======    ======        ======         ======       ======


                                        36


     Capital lease obligations are included in accrued expenses and other
liabilities. Operating lease obligations represent future minimum lease payments
under noncancellable operating leases with minimum or remaining lease terms in
excess of one year at December 31, 2003, and excludes $22.9 million in scheduled
minimum lease payments on our corporate office facility that we purchased on
February 5, 2004.

     We believe our cash and cash equivalents, investments in marketable
securities, and net cash provided from operations will provide adequate
liquidity to meet our normal operating requirements for at least the next twelve
months. A major component of our positive cash flow is the collection of
accounts receivable. The collection of accounts receivable continues to be an
area of focus and we have tightened up our credit authorization procedures.
Further, we invest our excess cash in short-term, interest-bearing instruments
that have a low risk of capital loss, such as U.S. government securities,
commercial paper and corporate bonds, and money market securities. Commercial
paper must be rated "1" by 2 of the 5 nationally recognized statistical rating
organizations. Corporate bonds must be rated Aa2 or AA or better by Moody's and
S&P, respectively.

CRITICAL ACCOUNTING POLICIES

     We have identified the policies below as critical to our business
operations and the understanding of our results of operations. The impact and
any associated risks related to these policies on our business operations is
discussed throughout Management's Discussion and Analysis of Financial Condition
and Results of Operations where such policies affect our reported and expected
financial results. The preparation of this Annual Report on Form 10-K requires
us to make estimates and assumptions that affect the reported amount of assets
and liabilities, disclosure of contingent assets and liabilities at the date of
our financial statements, and the reported amounts of revenue and expenses
during the reporting period. Actual results could differ from those estimates.

     - Revenue recognition.  Our revenue recognition policy is significant
       because our revenue is a key component of our results of operations. In
       addition, our revenue recognition determines the timing of certain
       expenses such as commissions and royalties. We follow specific and
       detailed guidelines in measuring revenue; however, certain judgments
       affect the application of our revenue policy.

       We license software under non-cancelable agreements and provide related
       services, including consulting, training and customer support. We
       recognize revenue in accordance with Statement of Position 97-2 ("SOP
       97-2"), Software Revenue Recognition, as amended and interpreted by
       Statement of Position 98-9, Modification of SOP 97-2, Software Revenue
       Recognition, with respect to certain transactions, as well as Technical
       Practice Aids issued from time to time by the American Institute of
       Certified Public Accountants, and Staff Accounting Bulletin No. 101 ("SAB
       101"), Revenue Recognition in Financial Statements, that provides further
       interpretive guidance for public companies on the recognition,
       presentation, and disclosure of revenue in financial statements.

       Software license revenue is recognized when a license agreement has been
       signed, the software product has been delivered, there are no
       uncertainties surrounding product acceptance, the fees are fixed and
       determinable, and collection is considered probable. If a software
       license contains an undelivered element, the vendor-specific objective
       evidence ("VSOE") of fair value of the undelivered element is deferred
       and the revenue recognized once the element is delivered. The undelivered
       elements are primarily training, consulting and maintenance services.
       VSOE of fair value for training and consulting services is based upon
       hourly rates charged when those services are sold separately. VSOE of
       fair value for maintenance is the price the customer will be required to
       pay when it is sold separately (that is, the renewal rate). In addition,
       if a software license contains customer acceptance criteria or a
       cancellation right, the software revenue is recognized upon the earlier
       of customer acceptance or the expiration of the acceptance period or
       cancellation right. Payments for our software licenses are typically due
       in installments within twelve months from the date of delivery. Although
       infrequent, where software license agreements call for payment terms of
       twelve months or more from the date of delivery, revenue is recognized as
       payments become due and all other conditions for revenue recognition have
       been satisfied.

                                        37


       Consulting and training services are separately priced, are generally
       available from a number of suppliers, and are not essential to the
       functionality of our software products. Consulting services, which
       include project management, system planning, design and implementation,
       customer configurations, and training are billed on both an hourly basis
       and under fixed price contracts. Consulting services revenue billed on an
       hourly basis is recognized as the work is performed. Training revenues
       are recognized when the training is provided and is included in
       consulting revenues in the Company's consolidated statements of income.
       Under fixed price contracts, consulting services revenue is recognized
       using the percentage of completion method of accounting by relating hours
       incurred to date to total estimated hours at completion.

       We have from time to time provided software and consulting services under
       fixed price contracts that require the achievement of certain milestones,
       and the payment terms in these contracts are generally tied to customer
       acceptance of the milestones. The revenue under such arrangements is
       recognized as the milestones are achieved or upon customer acceptance. We
       believe that milestones are a proper measure of progress under these
       contracts, as the milestones approximate the percentage of completion
       method of accounting.

       Customer support services include post contract support and the rights to
       unspecified upgrades and enhancements. Maintenance revenues from ongoing
       customer support services are billed on a monthly basis and recorded as
       revenue in the applicable month, or on an annual basis with the revenue
       being deferred and recognized ratably over the maintenance period.

       If an arrangement includes multiple elements, the fees are allocated to
       the various elements based upon VSOE of fair value, as described above.

     - Accounts Receivable.  Consistent with industry practice and to be
       competitive in the retail software marketplace, we typically provide
       installment payment terms on most software license sales. Software
       licenses are generally due in installments within twelve months from the
       date of delivery. All significant customers are reviewed for
       creditworthiness before the Company licenses its software and we do not
       sell our software or recognize any license revenue unless we believe that
       collection is probable in accordance with the requirements of paragraph 8
       in SOP 97-2. We have a history of collecting software payments when they
       come due without providing refunds or concessions. Consulting services
       are generally billed bi-weekly and maintenance services are billed
       annually or monthly. If a customer becomes significantly delinquent or
       its credit deteriorates, we put the accounts on hold and do not recognize
       any further services revenue (and in most cases we withdraw support
       and/or our implementation staff) until the situation has been resolved.

       We do not have significant billing or collection problems. We review each
       past due account and provide specific reserves based upon the information
       we gather from various sources including our customers, subsequent cash
       receipts, consulting services project teams, members of each region's
       management, and credit rating services such as Dun and Bradstreet.
       Although infrequent and unpredictable, from time to time certain of our
       customers have filed bankruptcy and we have been required to refund the
       pre-petition amounts collected and settle for less than the face value of
       their remaining receivable pursuant to a bankruptcy court order. In these
       situations, as soon as it becomes probable that the net realizable value
       of the receivable is impaired, we provide reserves on the receivable. In
       addition, we monitor economic conditions in the various geographic
       regions in which we operate to determine if general reserves or
       adjustments to our credit policy in a region are appropriate for
       deteriorating conditions that may impact the net realizable value of our
       receivables.

     - Intangible Assets.  Our business combinations typically result in
       goodwill and other intangible assets, which affects the amount of future
       period amortization expense and possible impairment expense that we will
       incur. The determination of the value of such intangible assets and the
       annual impairment tests require management to make estimates of future
       revenues, customer retention rates and other assumptions that affect our
       consolidated financial statements.

                                        38


     - Product Development.  The costs to develop new software products and
       enhancements to existing software products are expensed as incurred until
       technological feasibility has been established. We consider technological
       feasibility to have occurred when all planning, designing, coding and
       testing have been completed according to design specifications. Once
       technological feasibility is established, any additional costs would be
       capitalized. We believe our current process for developing software is
       essentially completed concurrent with the establishment of technological
       feasibility, and accordingly, no costs have been capitalized

     - Income Taxes.  Our income tax policy records the estimated future tax
       effects of temporary differences between the tax basis of assets and
       liabilities and amounts reported in the consolidated balance sheets, as
       well as operating loss and tax credit carry-forwards. We follow specific
       and detailed guidelines regarding the recoverability of any tax assets
       recorded on the balance sheet and provide any necessary allowances as
       required.

     - Stock-Based Compensation.  We do not record compensation expense for
       options granted to our employees as all options granted under our stock
       option plans have an exercise price equal to the market value of the
       underlying common stock on the date of grant. In addition, we do not
       record compensation expense for shares issued under our employee stock
       purchase plan. As permitted under Statement of Financial Accounting
       Standards No. 123, Accounting for Stock-Based Compensation ("SFAS No.
       123"), we have elected to continue to apply the provisions of Accounting
       Principles Board Opinion No. 25, Accounting for Stock Issued to
       Employees, and provide pro forma disclosure on a quarterly and annual
       basis of net income (loss) and net income (loss) per common share for
       employee stock option grants made, and shares issued under our employee
       stock purchase plan, as if the fair-value method defined in SFAS No. 123
       had been applied. We terminated our 1999 Purchase Plan in August 2003.

     The following table presents pro forma disclosure of net income (loss) and
basic and diluted earnings (loss) per share as if stock-based compensation
expense had been recognized during the three-year period ended December 31,
2003. The compensation expense for these periods has been determined under the
fair value method using the Black-Scholes pricing model, and assumes graded
vesting.



                                                  2003              2002          2001
                                           -------------------   -----------   -----------
                                                                      
Net income as reported...................              $ 2,650       $ 8,930       $ 9,648
Less: stock-based compensation expense,
  net of related tax effects.............               (6,121)       (9,356)       (7,167)
                                                      --------      --------      --------
Pro forma net income (loss)..............               (3,471)         (426)        2,481
Basic earnings per share -- as
  reported...............................                  .09           .32           .38
Diluted earnings per share -- as
  reported...............................                  .09           .31           .37
Basic earnings (loss) per share -- pro
  forma..................................                 (.12)         (.02)          .10
Diluted earnings (loss) per share -- pro
  forma..................................                 (.12)         (.02)          .10
ASSUMPTIONS:
Expected dividend yield..................                    0%            0%            0%
Expected stock price volatility..........                   90%           93%           81%
Risk-free interest rate..................                 2.25%         2.25%         3.85%
Expected life of option..................     2.63 to 3.17 years    2.96 years    3.13 years


RECENT ACCOUNTING PRONOUNCEMENTS

     In June 2002, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 146, Accounting for Costs Associated with
Exit or Disposal Activities ("SFAS No. 146"). The provisions of SFAS No. 146 are
effective for exit or disposal activities that are initiated after December 31,
2002. SFAS No. 146 was adopted effective January 1, 2003. SFAS No. 146 addresses
financial accounting and reporting for costs associated with exit or disposal
activities and nullifies EITF No. 94-3. Under

                                        39


SFAS No. 146, the liability for costs associated with exit or disposal
activities is recognized and measured initially at fair value only when the
liability is incurred, rather than at the date the Company committed to the exit
plan. All exit or disposal activities that have occurred since January 1, 2003
have been accounted for in accordance with SFAS No. 146.

     In December 2002, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 148, Accounting for Stock-Based
Compensation -- Transition and Disclosure ("SFAS No. 148") which is effective
for fiscal years ending after December 15, 2002. SFAS No. 148 amends SFAS No.
123 to provide alternative methods of transition to SFAS No. 123's fair value
method of accounting for stock-based employee compensation if a company elects
to account for its equity awards under this method. SFAS No. 148 also amends the
disclosure provisions of SFAS No. 123 and APB Opinion No. 28, Interim Financial
Reporting, to require disclosure of the effects of an entity's accounting policy
with respect to stock-based employee compensation on reported net income and
earnings per share in both annual and interim financial statements.

     In January 2003, the Financial Accounting Standards Board issued FASB
Interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities,"
which was subsequently revised in December 2003. Variable interest entities are
defined as entities with a level of invested equity that is not sufficient to
fund future activities to permit it to operate on a stand-alone basis. We do not
participate in variable interest entities.

     In April 2003, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 149, Amendment of Statement 133 on Derivative
Instruments and Hedging Activities ("SFAS No. 149"). The provisions of SFAS No.
149 amend and clarify the accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and for hedging
activities under SFAS No. 133. SFAS No. 149 is effective for contracts entered
into or modified after June 30, 2003. The adoption of SFAS No. 149 did not have
a significant impact on our financial statements.

     We did not engage in any material foreign currency hedging transactions
during 2002; however, during fourth quarter 2003 we began using derivative
financial instruments, primarily forward exchange contracts, to manage a
majority of the foreign currency exchange exposure associated with the net
short-term foreign denominated assets and liabilities which exist as part of our
ongoing business operations. The exposures relate primarily to the gain or loss
recognized in earnings from the revaluation or settlement of current foreign
denominated assets and liabilities. We do not enter into derivative financial
instruments for trading or speculative purposes. The forward exchange contracts
generally have maturities of less than 90 days, and are not designated as
hedging instruments under SFAS No. 133. Forward exchange contracts are
marked-to-market at the end of each reporting period, with gains and losses
recognized in other income, net, offset by the gains or losses resulting from
the settlement of the underlying foreign denominated assets and liabilities.

     In May 2003, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity ("SFAS No.
150"). SFAS No. 150 requires certain financial instruments that embody
obligations of the issuer, and which have characteristics of both liabilities
and equity, to be classified as liabilities. SFAS No. 150 is effective for
financial instruments entered into or modified after May 31, 2003. We do not
have any financial instruments, as defined in SFAS No. 150, that have
characteristics of both liabilities and equity.

FACTORS THAT MAY AFFECT OUR FUTURE RESULTS OR THE MARKET PRICE OF OUR STOCK

     We operate in a dynamic and rapidly changing environment that involves
numerous risks and uncertainties. The following section describes some, but not
all, of these risks and uncertainties that we believe may adversely affect our
business, financial condition or results of operations. This section should be
read in conjunction with the Audited Consolidated Financial Statements and Notes
thereto, and Management's Discussion and Analysis of Financial Condition and
Results of Operations as of December 31, 2003 and for the year then ended
contained elsewhere in this Form 10-K.

                                        40


REGIONAL AND/OR GLOBAL CHANGES IN ECONOMIC, POLITICAL AND MARKET CONDITIONS
COULD CAUSE DECREASES IN DEMAND FOR OUR SOFTWARE AND RELATED SERVICES WHICH
COULD NEGATIVELY AFFECT OUR REVENUE AND OPERATING RESULTS AND THE MARKET PRICE
OF OUR STOCK.

     Our revenue and profitability depend on the overall demand for our software
and related services. A regional and/or global change in the economy and
financial markets could result in delay or cancellation of customer purchases.
We and most of our competitors recently announced that current economic
conditions have negatively impacted financial results. In addition, recent
developments associated with terrorist attacks on United States' interests, the
US war and continued violence in Iraq, and the Severe Acute Respiratory Syndrome
("SARS") have resulted in economic, political and other uncertainties, which
could further adversely affect our revenue growth and operating results. If
demand for our software and related services decrease, our revenues would
decrease and our operating results would be adversely affected. Our inability to
license software products to new customers may cause our stock price to fall.

OUR QUARTERLY OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY, WHICH COULD
ADVERSELY AFFECT THE PRICE OF OUR STOCK.

     Our quarterly operating results have varied and are expected to continue to
vary in the future. If our quarterly operating results fail to meet management's
or analysts' expectations, the price of our stock could decline. Many factors
may cause these fluctuations, including:

     - Demand for our software products and services, including the size and
       timing of individual contracts and our ability to recognize revenue with
       respect to contracts signed in the quarter, particularly with respect to
       our significant customers;

     - Changes in the length of our sales cycle;

     - Competitive pricing pressures and the competitive success or failure on
       significant transactions;

     - Customer order deferrals resulting from the anticipation of new products,
       economic uncertainty, disappointing operating results by the customer, or
       otherwise;

     - The timing of new software product and technology introductions and
       enhancements to our software products or those of our competitors, and
       market acceptance of our new software products and technology;

     - Changes in our operating expenses;

     - Changes in the mix of domestic and international revenues, or expansion
       or contraction of international operations;

     - Our ability to complete fixed price consulting contracts within budget;

     - Foreign currency exchange rate fluctuations;

     - Operational issues resulting from corporate reorganizations; and

     - Lower-than-anticipated utilization in our consulting services group as a
       result of reduced levels of software sales, reduced implementation times
       for our products, changes in the mix of demand for our software products,
       or other reasons.

OUR STOCK PRICE HAS BEEN AND MAY REMAIN VOLATILE.

     The trading price of our common stock has in the past and may in the future
be subject to wide fluctuations. Examples of factors that we believe have caused
fluctuations in our stock price in the past include the following:

     - Cancelled or delayed purchasing decisions related to the September 11
       terrorist attack and the uncertainty related to potential future
       terrorist attacks and the war with and continued violence in Iraq;

     - The millennium change;

                                        41


     - Conversion to the Euro currency;

     - External and internal marketing issues;

     - Our announcement of our reduced visibility and increased uncertainty
       concerning future demand for our products;

     - Increased competition;

     - Elongated sales cycles;

     - A limited number of reference accounts with implementations in the early
       years of product release;

     - Certain design and stability issues in early versions of our products;
       and

     - Lack of desired features and functionality.

     In addition, fluctuations in the price of our common stock may expose us to
the risk of securities class action lawsuits. Defending against such lawsuits
could result in substantial costs and divert management's attention and
resources. Furthermore, any settlement or adverse determination of these
lawsuits could subject us to significant liabilities.

OUR GROSS MARGINS MAY VARY SIGNIFICANTLY OR DECLINE.

     Because the gross margins on product revenues (software licenses and
maintenance services) are significantly greater than the gross margins on
consulting services revenue, our combined gross margin has fluctuated from
quarter to quarter, and it may continue to fluctuate significantly based on
revenue mix. As a result of the economic downturn, we believe retailers have
changed their buying behavior and that this has resulted in a fundamental shift
in the mix of demand for the various types of products we sell. Demand for our
MERCHANDISE MANAGEMENT SYSTEMS and IN-STORE SYSTEMS has declined. We believe
retailers have changed their buying behavior and that this has resulted in a
fundamental shift in the mix of demand for the various types of products we sell
from longer, high dollar infrastructure type projects typically associated with
our MERCHANDISE MANAGEMENT SYSTEMS and IN-STORE SYSTEMS, to our STRATEGIC
MERCHANDISE MANAGEMENT SOLUTIONS that are less disruptive, have a higher ROI,
shorter implementation timeframes and a lower total cost of ownership. The
decline in software sales of MERCHANDISE MANAGEMENT SYSTEMS and IN-STORE SYSTEMS
is having a corollary negative impact on our service revenues as consulting
services revenue typically lags the performance of software revenues by as much
as one year. In addition, our gross margins on consulting services revenue vary
significantly with the rates at which we utilize our consulting personnel, and
as a result, our overall gross margins will be adversely affected when there is
not enough work to keep our consultants busy. We may face some constraints on
our ability to adjust consulting service headcount and expense to meet demand,
due in part to our need to retain consulting personnel with sufficient skill
sets to implement and maintain our full set of products.

WE MAY MISJUDGE WHEN SOFTWARE SALES WILL BE REALIZED.

     Software license revenues in any quarter depend substantially upon
contracts signed and the related shipment of software in that quarter. It is
therefore difficult for us to accurately predict software license revenues.
Because of the timing of our sales, we typically recognize the substantial
majority of our software license revenues in the last weeks or days of the
quarter, and we may derive a significant portion of our quarterly software
license revenues from a small number of relatively large sales. In addition, it
is difficult to forecast the timing of large individual software license sales
with a high degree of certainty due to the extended length of the sales cycle
and the generally more complex contractual terms that may be associated with
such licenses that could result in the deferral of some or all of the revenue to
future periods. Accordingly, large individual sales have sometimes occurred in
quarters subsequent to when we anticipated. We expect these aspects of our
business to continue. If we receive any significant cancellation or deferral of
customer orders, or we are unable to conclude license negotiations by the end of
a fiscal quarter, our operating results may be lower than anticipated. In
addition, any weakening or uncertainty in the economy may make it more

                                        42


difficult for us to predict quarterly results in the future, and could
negatively impact our business, operating results and financial condition for an
indefinite period of time.

WE MAY NOT BE ABLE TO REDUCE EXPENSE LEVELS IF OUR REVENUES DECLINE.

     Our expense levels are based on our expectations of future revenues. Since
software license sales are typically accompanied by a significant amount of
consulting and maintenance services, the size of our services organization must
be managed to meet our anticipated software license revenues. As a result, we
hire and train service personnel and incur research and development costs in
advance of anticipated software license revenues. If software license revenues
fall short of our expectations, or if we are unable to fully utilize our service
personnel, our operating results are likely to decline because a significant
portion of our expenses cannot be quickly reduced to respond to any unexpected
revenue shortfall.

WE ARE DEPENDENT UPON THE RETAIL INDUSTRY.

     Historically, we have derived 80% or more of our revenues from the license
of software products and the performance of related services to retail
customers. Although the acquisitions of Arthur, Intactix, Zapotec, NeoVista
Decision Series, E3, Vista and Engage have expanded our product offerings to
provide collaborative applications that address new vertical market
opportunities with the manufacturers and wholesalers who supply our traditional
retail customers, our future growth is critically dependent on increased sales
to retail customers. The success of our customers is directly linked to economic
conditions in the retail industry, which in turn are subject to intense
competitive pressures and are affected by overall economic conditions. In
addition, we believe that the licensing of certain of our software products
involves a large capital expenditure, which is often accompanied by large-scale
hardware purchases or other capital commitments. As a result, demand for our
products and services could decline in the event of instability or potential
downturns.

     We believe the retail industry remains cautious with their level of
investment in information technology during the difficult economic cycle of the
last few years, and uncertainty related to the threat of future terrorist
attacks and any continued violence in Iraq. We remain concerned about weak and
uncertain economic conditions, consolidations and the disappointing results of
retailers in certain of our geographic regions. The retail industry will be
negatively impacted if weak economic conditions or fear of additional
terrorists' attacks and wars persist for an extended period of time. Weak and
uncertain economic conditions have in the past, and may in the future,
negatively impact our revenues, including a potential deterioration of our
maintenance revenue base as customers look to reduce their costs, elongate our
selling cycles, and delay, suspend or reduce the demand for our products. As a
result, it is difficult in the current economic environment to predict exactly
when specific software licenses will close within a six to nine month time
frame. In addition, weak and uncertain economic conditions could impair our
customers' ability to pay for our products or services. Any of these factors
could adversely impact our business, quarterly or annual operating results and
financial condition.

     We also believe that the retail industry may be consolidating, and that the
industry is currently experiencing increased competition in certain geographical
regions that could negatively impact the industry and our customers' ability to
pay for our products and services. Such consolidation has in the past, and may
in the future, negatively impact our revenues, reduce the demand for our
products and may negatively impact our business, operating results and financial
condition.

THERE MAY BE AN INCREASE IN CUSTOMER BANKRUPTCIES DUE TO WEAK ECONOMIC
CONDITIONS.

     We have in the past and may in the future be impacted by customer
bankruptcies that occur in periods subsequent to the software license sale.
During weak economic conditions, such as those currently being experienced in
our international regions, there is an increased risk that certain of our
customers will file bankruptcy. When our customers file bankruptcy, we may be
required to forego collection of pre-petition amounts owed and to repay amounts
remitted to us during the 90-day preference period preceding the filing.
Accounts receivable balances related to pre-petition amounts may in certain of
these instances be large due to extended payment terms for software license
fees, and significant billings for consulting and implementation services on
large projects. The bankruptcy laws, as well as the specific circumstances of
each bankruptcy, may

                                        43


severely limit our ability to collect pre-petition amounts, and may force us to
disgorge payments made during the 90-day preference period. We also face risk
from international customers that file for bankruptcy protection in foreign
jurisdictions, in that the application of foreign bankruptcy laws may be more
difficult to predict. Although we believe that we have sufficient reserves to
cover anticipated customer bankruptcies, there can be no assurance that such
reserves will be adequate, and if they are not adequate, our business, operating
results and financial condition would be adversely affected.

WE MAY HAVE DIFFICULTY ATTRACTING AND RETAINING SKILLED PERSONNEL.

     Our success is heavily dependent upon our ability to attract, hire, train,
retain and motivate skilled personnel, including sales and marketing
representatives, qualified software engineers involved in ongoing product
development, and consulting personnel who assist in the implementation of our
products and services. The market for such individuals is competitive. For
example, it may be particularly difficult to attract and retain product
development personnel experienced in the Microsoft .Net Platform since the .Net
Platform is a new and evolving technology. Given the critical roles of our
sales, product development and consulting staffs, our inability to recruit
successfully or any significant loss of key personnel would hurt us. A high
level of employee mobility and aggressive recruiting of skilled personnel
characterize the software industry. We cannot guarantee that we will be able to
retain our current personnel, attract and retain other highly qualified
technical and managerial personnel in the future, or be able to assimilate the
employees from any acquired businesses. We will continue to adjust the size and
composition of the workforce in our services organization to match the different
product and geographic demand cycles. If we were unable to attract and retain
the necessary technical and managerial personnel, or assimilate the employees
from any acquired businesses, our business, operating results and financial
condition would be adversely affected.

WE HAVE ONLY DEPLOYED CERTAIN OF OUR SOFTWARE PRODUCTS ON A LIMITED BASIS, AND
HAVE NOT YET DEPLOYED SOME SOFTWARE PRODUCTS THAT ARE IMPORTANT TO OUR FUTURE
GROWTH.

     Certain of our software products, including CUSTOMER ORDERING, STORE
PORTAL, PORTFOLIO POINT OF SALES, and certain modules of PORTFOLIO CRM and
INTELLECT, have been commercially released within the last two years. Other
modules of PORTFOLIO CRM and INTELLECT are still in beta or under development.
In addition, we have only recently announced our intentions to develop or
acquire a series of business-to-business e-commerce solutions, including
products in furtherance of our pursuit of the market for Collaborative
Solutions. The markets for these products are new and evolving, and we believe
that retailers and their suppliers may be cautious in adopting web-based and
other new technologies. Consequently, we cannot predict the growth rate, if any,
and size of the markets for our e-commerce products or that these markets will
continue to develop. Potential and existing customers may find it difficult, or
be unable, to successfully implement our e-commerce products, or may not
purchase our products for a variety of reasons, including their inability or
unwillingness to deploy sufficient internal personnel and computing resources
for a successful implementation. In addition, we must overcome significant
obstacles to successfully market our newer products, including limited
experience of our sales and consulting personnel. If the markets for our newer
products fail to develop, develop more slowly or differently than expected or
become saturated with competitors, or if our products are not accepted in the
marketplace or are technically flawed, our business, operating results and
financial condition will decline.

WE ARE INVESTING HEAVILY IN RE-WRITING MANY OF OUR PRODUCTS FOR THE MICROSOFT
..NET PLATFORM.

     We are developing a series of enhancements to the JDA Portfolio products,
based upon the Microsoft .Net technology platform (".Net Platform"), that we
believe will position us uniquely in the retail and collaborative solutions
markets. Our goals are to ensure that our solutions offer: (i) increased ease of
use, (ii) increased integration of business processes, (iii) reduced cost of
ownership, (iv) faster implementation, and (v) faster return on investment. We
believe our next generation technology will enhance our competitive position
since we will be able to offer significant features and functionality using an
advanced technology platform. Our goal is to begin delivering applications on
the .Net Platform in third quarter 2004, starting with PORTFOLIO REPLENISHMENT
BY E3, followed by PORTFOLIO PLANNING BY ARTHUR, and certain of our INTELLECT

                                        44


applications. This is a significant investment by the Company as we are building
our next generation of products, while at the same time, we continue development
efforts on our existing products and complete the integration of acquired
products. We also plan to develop new products as well as shared code components
using the .Net Platform. The risks of our commitment to the .Net Platform
include, but are not limited to, the following:

     - The possibility that it may be more difficult than we currently
       anticipate to develop our products for the .Net Platform, and we could
       incur costs in excess of our projections to complete the planned
       transition of our product suite;

     - The possibility that prospective customers will refrain from purchasing
       the current versions of products to be re-written because they are
       waiting for the .Net Platform versions;

     - The possibility that our .Net Platform beta customers will not become
       favorable reference sites;

     - Adequate scalability of the .Net Platform for our largest customers;

     - The possibility we may not complete the transition to the .Net Platform
       in the time frame we currently expect;

     - The ability of our development staff to learn how to efficiently and
       effectively develop products using the .Net Platform;

     - Our ability to transition our customer base onto the .Net Platform when
       it is available;

     - Microsoft's ability to achieve market acceptance of the .Net platform;
       and

     - Microsoft's continued commitment to enhancing and marketing the .Net
       platform.

     Despite efforts to mitigate the risks of the .Net Platform project, there
can be no assurances that our efforts to re-write many of our current products
and to develop new products using the .Net Platform will be successful. If the
..Net Platform project is not successful, it likely will have a material adverse
effect on our business, operating results and financial condition. Moreover, we
cannot assure you that, even if we successfully re-write our products on the
..Net Platform, our re-written products will achieve market acceptance.

WE MAY INTRODUCE NEW LINES OF BUSINESS WHERE WE ARE LESS EXPERIENCED.

     We may introduce new lines of business that are outside our traditional
focus on software licenses and related maintenance and implementation services.
Introducing new lines of business involves a number of uncertainties, including
a lack of internal resources and expertise to operate and grow such new lines of
business, immature internal processes and controls, inexperience predicting
revenues and expenses for the new lines of business, and the possibility that
such new lines of business will divert management attention and resources from
our traditional business. The inability of management to effectively develop and
operate these new lines of business could have a material adverse effect on our
business, operating results and financial condition. Moreover, we may not be
able gain acceptance of any new lines of business in our markets, penetrate new
markets successfully, or obtain the anticipated or desired benefits of such new
lines of business.

THERE ARE MANY RISKS ASSOCIATED WITH INTERNATIONAL OPERATIONS.

     Our international revenues represented 44% of total revenues in the year
ended December 31, 2003 as compared to 43% and 44% in the years ended December
31, 2002 and 2001, respectively. If our international operations grow, we must
recruit and hire a number of new consulting, sales and marketing and support
personnel in the countries in which we have or will establish offices. Our entry
into new international markets typically requires the establishment of new
marketing and distribution channels as well as the development and subsequent
support of localized versions of our software. International introductions of
our products often require a significant investment in advance of anticipated
future revenues. The opening of our new offices typically results in initial
recruiting and training expenses and reduced labor efficiencies associated with
the introduction of products to a new market. If we are less successful in a new
market than we expect, we may

                                        45


not be able to realize an adequate return on our initial investment and our
operating results could suffer. If we have to downsize certain international
operations, the costs to do so are typically much higher than downsizing costs
in the United States, particularly in Europe. We cannot guarantee that the
countries in which we operate will have a sufficient pool of qualified personnel
from which to hire, that we will be successful at hiring, training or retaining
such personnel, or that we can expand or contract our international operations
in a timely, cost effective manner.

     Our international business operations are subject to risks associated with
international activities, including:

     - Currency fluctuations;

     - Higher operating costs due to local laws or regulations;

     - Unexpected changes in employment and other regulatory requirements;

     - Tariffs and other trade barriers;

     - Costs and risks of localizing products for foreign countries;

     - Longer accounts receivable payment cycles in certain countries;

     - Potentially negative tax consequences;

     - Difficulties in staffing and managing geographically disparate
       operations;

     - Greater difficulty in safeguarding intellectual property, licensing and
       other trade restrictions;

     - Ability to negotiate and have enforced favorable contract provisions;

     - Repatriation of earnings;

     - The burdens of complying with a wide variety of foreign laws;

     - Anti-American sentiment due to the war with Iraq, and other American
       policies that may be unpopular in certain regions;

     - The effects of regional and global infectious diseases such as SARS; and

     - General economic conditions in international markets.

     Consulting services in support of certain international software licenses
typically have lower gross margins than those achieved domestically due to
generally lower billing rates and/or higher costs in certain of our
international markets. Accordingly, any significant growth in our international
operations may result in declines in gross margins on consulting services. We
expect that an increasing portion of our international software license,
consulting services and maintenance services revenues will be denominated in
foreign currencies, subjecting us to fluctuations in foreign currency exchange
rates. As we continue to expand our international operations, exposures to gains
and losses on foreign currency transactions may increase. We may choose to limit
such exposure from time to time by entering into forward foreign currency
exchange contracts or engaging in similar hedging strategies. We cannot
guarantee that any currency exchange strategy would be successful in avoiding
exchange-related losses. In addition, revenues earned in various countries where
we do business may be subject to taxation by more than one jurisdiction, which
would reduce our earnings.

WE MAY FACE DIFFICULTIES IN OUR HIGHLY COMPETITIVE MARKETS, PARTICULARLY IF THE
CURRENT WEAK ECONOMIC CONDITIONS PERSIST.

     We encounter competitive products from a different set of vendors in each
of our primary product categories. We believe that while our markets are still
subject to intense competition, the number of significant competitors in many of
our application markets has diminished over the past five years. We believe the
principal competitive factors in our markets are feature and functionality,
product reputation and reference accounts, vendor viability, retail and supply
chain industry expertise, total solution cost and quality of customer support.

                                        46


     Our Retail Enterprise Systems compete primarily with internally developed
systems and other third-party developers such as AC Nielsen Corporation, Aldata
Solutions, Alphameric PLC (formerly Compass Software Group PLC), Connect3
Systems, Inc., Island Pacific, Inc. (formerly SVI Holdings, Inc., Marketmax,
Inc. (recently acquired by SAS), Micro Strategies Incorporated, Evant, Inc.
(formerly Nonstop Solutions), Lawson Software, NSB Retail Systems PLC, Retek,
Inc., and SAP AG. In addition, new competitors may enter our markets and offer
merchandise management systems that target the retail industry.

     The competition for our In-Store Systems is more fragmented than the
competition for our Retail Enterprise Systems. We compete primarily with small
point-of-sale focused companies such as CRS Business Computers, Kronos
Incorporated, MICRO Systems, Inc. (formerly Datavantage, Inc.), Radiant Systems,
Inc., 360 Commerce, Tomax Technologies and Triversity, Inc. We also compete with
other broad solution set providers such as NSB Retail Systems PLC, Retek, Inc.,
and SAP AG (Campbell Software Division).

     Our current Collaborative Solutions compete primarily with products from
Marketmax, Inc. (recently acquired by SAS), Evant Inc. (formerly Nonstop
Solutions), AC Nielsen Corporation, i2 Technologies, Manugistics Group, Inc.,
Information Resources, Inc., and Synchra Systems.

     In the market for consulting services, we have pursued a strategy of
forming informal working relationships with leading retail systems integrators
such as IBM Global Services, Cap Gemini Ernst & Young, Kurt Salmon Associates
and Lakewest Consulting. These integrators, as well as independent consulting
firms such as Accenture, AIG Netplex, CFT Consulting, SPL and ID Applications,
also represent competition to our consulting services group. Moreover, because
many of these consulting firms are involved in advising our prospective
customers in the software selection process, they may successfully encourage a
prospective customer to select software from a software company with whom they
have a relationship. Examples of such relationships between consulting firms and
software companies include the relationships between Retek, Inc. and Accenture.

     As we continue to develop or acquire e-commerce products and expand our
business in the Collaborative Solutions area, we expect to face potential
competition from business-to-business e-commerce application providers,
including Ariba, Commerce One, Commercialware, i2 Technologies, Manugistics
Group, Inc., Microsoft, Inc., Retek, Inc., SAP AG, Synchra Systems, Ecometry
Corporation, and others.

     A few of our existing competitors, as well as a number of potential new
competitors, have significantly greater financial, technical, marketing and
other resources than we do, which could provide them with a significant
competitive advantage over us. In addition, we could face competition from
large, multi-industry technology companies that have historically not offered an
enterprise solution set to the retail supply chain market. We cannot guarantee
that we will be able to compete successfully against our current or future
competitors, or that competition will not have a material adverse effect on our
business, operating results and financial condition.

IT MAY BE DIFFICULT TO IDENTIFY, ADOPT AND DEVELOP PRODUCT ARCHITECTURE THAT IS
COMPATIBLE WITH EMERGING INDUSTRY STANDARDS.

     The markets for our software products are characterized by rapid
technological change, evolving industry standards, changes in customer
requirements and frequent new product introductions and enhancements. We
continuously evaluate new technologies and implement into our products advanced
technology such as our current .Net effort. However, if we fail in our product
development efforts to accurately address in a timely manner, evolving industry
standards, new technology advancements or important third-party interfaces or
product architectures, sales of our products and services will suffer.

     Our software products can be licensed with a variety of popular industry
standard platforms, and are authored in various development environments using
different programming languages and underlying databases and architectures.
There may be future or existing platforms that achieve popularity in the
marketplace that may not be compatible with our software product design.
Developing and maintaining consistent software product performance across
various technology platforms could place a significant strain on our resources
and software product release schedules, which could adversely affect our results
of operations.

                                        47


WE MAY HAVE DIFFICULTY IMPLEMENTING OUR PRODUCTS.

     Our software products are complex and perform or directly affect
mission-critical functions across many different functional and geographic areas
of the enterprise. Consequently, implementation of our software products can be
a lengthy process, and commitment of resources by our clients is subject to a
number of significant risks over which we have little or no control. Although
average implementation times have recently declined, we believe the
implementation of the UNIX/Oracle versions of our products can be longer and
more complicated than our other applications as they typically (i) appeal to
larger retailers who have multiple divisions requiring multiple implementation
projects, (ii) require the execution of implementation procedures in multiple
layers of software, (iii) offer a retailer more deployment options and other
configuration choices, and (iv) may involve third party integrators to change
business processes concurrent with the implementation of the software. Delays in
the implementations of any of our software products, whether by our business
partners or us, may result in client dissatisfaction, disputes with our
customers, or damage to our reputation. Significant problems implementing our
software therefore, can cause delays or prevent us from collecting license fees
for our software and can damage our ability to get new business.

OUR FIXED-PRICE SERVICE CONTRACTS MAY RESULT IN LOSSES.

     We offer a combination of software products, consulting and maintenance
services to our customers. Typically, we enter into service agreements with our
customers that provide for consulting services on a "time and expenses" basis.
Certain clients have asked for, and we have from time to time entered into,
fixed-price service contracts, which link services payments, and occasionally
software payments, to implementation milestones. We believe fixed-price service
contracts may increasingly be offered by our competitors to differentiate their
product and service offerings. As a result, we may need to enter into more
fixed-price contracts in the future. If we are unable to meet our contractual
obligations under fixed-price contracts within our estimated cost structure, our
operating results could suffer.

OUR SUCCESS DEPENDS UPON OUR PROPRIETARY TECHNOLOGY.

     Our success and competitive position is dependent in part upon our ability
to develop and maintain the proprietary aspect of our technology. The reverse
engineering, unauthorized copying, or other misappropriation of our technology
could enable third parties to benefit from our technology without paying for it.

     We rely on a combination of trademark, trade secret, copyright law and
contractual restrictions to protect the proprietary aspects of our technology.
We seek to protect the source code to our software, documentation and other
written materials under trade secret and copyright laws. To date, we have not
protected our technology with issued patents. Effective copyright and trade
secret protection may be unavailable or limited in certain foreign countries. We
license our software products under signed license agreements that impose
restrictions on the licensee's ability to utilize the software and do not permit
the re-sale, sublicense or other transfer of the source code. Finally, we seek
to avoid disclosure of our intellectual property by requiring employees and
independent consultants to execute confidentiality agreements with us and by
restricting access to our source code.

     There has been a substantial amount of litigation in the software and
Internet industries regarding intellectual property rights. It is possible that
in the future third parties may claim that our current or potential future
software solutions or we infringe on their intellectual property. We expect that
software product developers and providers of e-commerce products will
increasingly be subject to infringement claims as the number of products and
competitors in our industry segment grows and the functionality of products in
different industry segments overlap. Moreover, as software patents become more
common, the likelihood increases that a patent holder will bring an infringement
action against us, or against our customers, to whom we have indemnification
obligations. In addition, we may find it necessary to initiate claims or
litigation against third parties for infringement of our proprietary rights or
to protect our trade secrets. Since we now resell hardware we may also become
subject to claims from third parties that the hardware, or the combination of
hardware and software, infringe their intellectual property. Although we may
disclaim certain intellectual property representations to our customers, these
disclaimers may not be sufficient to fully protect us against

                                        48


such claims. We may be more vulnerable to patent claims since we do not have any
patents that we can assert defensively against a patent infringement claim. Any
claims, with or without merit, could be time consuming, result in costly
litigation, cause product shipment delays or require us to enter into royalty or
license agreements. Royalty or licensing agreements, if required, may not be
available on terms acceptable to us or at all, which could have a material
adverse effect on our business, operating results and financial condition.

IF WE LOSE ACCESS TO CRITICAL THIRD-PARTY SOFTWARE OR TECHNOLOGY, OUR COSTS
COULD INCREASE AND THE INTRODUCTION OF NEW PRODUCTS AND PRODUCT ENHANCEMENTS
COULD BE DELAYED, POTENTIALLY HURTING OUR COMPETITIVE POSITION.

     We license and integrate technology from third parties in certain of our
software products. For example, we license the Uniface client/server application
development technology from Compuware, Inc. for use in PMM, certain applications
from Silvon Software, Inc. for use in IDEAS, IBM's Net.commerce merchant server
software for use in CUSTOMER ORDERING, and the Syncsort application for use in
PORTFOLIO PLANNING BY ARTHUR. These third party licenses generally require us to
pay royalties and fulfill confidentiality obligations. If we are unable to
continue to license any of this third party software, or if the third party
licensors do not adequately maintain or update their products, we would face
delays in the releases of our software until equivalent technology can be
identified, licensed or developed, and integrated into our software products.
These delays, if they occur, could harm our business, operating results and
financial condition. It is also possible that intellectual property acquired
from third parties through acquisitions, mergers, licenses or otherwise may not
have been adequately protected.

WE MAY FACE LIABILITY IF OUR PRODUCTS ARE DEFECTIVE OR IF WE MAKE ERRORS
IMPLEMENTING OUR PRODUCTS.

     Our software products are highly complex and sophisticated. As a result,
they may occasionally contain design defects or software errors that could be
difficult to detect and correct. In addition, implementation of our products may
involve customer-specific configuration by third parties or us, and may involve
integration with systems developed by third parties. In particular, it is common
for complex software programs, such as our UNIX/Oracle and e-commerce software
products, to contain undetected errors when first released. They are discovered
only after the product has been implemented and used over time with different
computer systems and in a variety of applications and environments. Despite
extensive testing, we have in the past discovered certain defects or errors in
our products or custom configurations only after our software products have been
used by many clients. For example, we will likely experience undetected errors
in our .Net applications as we begin to implement them for the first time at
customer sites. In addition, our clients may occasionally experience
difficulties integrating our products with other hardware or software in their
environment that are unrelated to defects in our products. Such defects, errors
or difficulties may cause future delays in product introductions and shipments,
result in increased costs and diversion of development resources, require design
modifications or impair customer satisfaction with our products.

     We believe that significant investments in research and development are
required to remain competitive, and that speed to market is critical to our
success. Our future performance will depend in large part on our ability to
enhance our existing products through internal development and strategic
partnering, internally develop new products which leverage both our existing
customers and sales force, and strategically acquire complementary retail point
and collaborative solutions that add functionality for specific business
processes to an enterprise-wide system. If clients experience significant
problems with implementation of our products or are otherwise dissatisfied with
their functionality or performance or if they fail to achieve market acceptance
for any reason, our market reputation could suffer, and we could be subject to
claims for significant damages. Although our customer agreements contain
limitation of liability clauses and exclude consequential damages, there can be
no assurances that such contract provisions will be enforced. Any such damages
claim could impair our market reputation and could have a material adverse
affect on our business, operating results and financial condition.

                                        49


WE ARE DEPENDENT ON KEY PERSONNEL.

     Our performance depends in large part on the continued performance of our
executive officers and other key employees, particularly the performance and
services of James D. Armstrong our Chairman and Hamish N. J. Brewer our Chief
Executive Officer. Mr. Brewer was promoted to Chief Executive Officer on August
4, 2003 having served as our President since April 2001 and as a senior officer
of the Company since 1996. He succeeds Mr. Armstrong who continues as Chairman
of the Board. As Chairman, Mr. Armstrong retains his active leadership role,
focusing on strategic planning, merger and acquisition opportunities, major
product decisions and key customer relationships. We do not have in place "key
person" life insurance policies on any of our employees. The loss of the
services of Mr. Armstrong, Mr. Brewer, or other key executive officers or
employees without a successor in place, or any difficulties associated with our
succession, could negatively affect our financial performance.

WE MAY HAVE DIFFICULTY INTEGRATING ACQUISITIONS.

     We continually evaluate potential acquisitions of complementary businesses,
products and technologies, including those that are significant in size and
scope. In pursuit of our strategy to acquire complementary products, we
completed the acquisition of the assets of Zapotec Software, Inc. in February
2001, the NeoVista Decision Series from Accrue Software, Inc. in June 2001, the
acquisition of all the common stock of E3 in September 2001, the acquisition of
certain intellectual property from J -- Commerce in April 2002, and the
acquisition of certain intellectual property from Vista Software Solutions, Inc.
in April 2003, the acquisition of substantially all remaining intellectual
property and certain other assets of Engage, Inc in August 2003, and the
acquisition of substantially all the assets of Timera Retail Solutions on
January 29, 2004. The E3 acquisition was our largest to date, and involved the
integration of E3's products and operations in 12 countries. The risks we
commonly encounter in acquisitions include:

     - We may have difficulty assimilating the operations and personnel of the
       acquired company;

     - We may have difficulty effectively integrating the acquired technologies
       or products with our current products and technologies;

     - Our ongoing business may be disrupted by transition and integration
       issues;

     - We may not be able to retain key technical and managerial personnel from
       the acquired business;

     - We may be unable to achieve the financial and strategic goals for the
       acquired and combined businesses;

     - We may have difficulty in maintaining controls, procedures and policies
       during the transition and integration;

     - Our relationships with partner companies or third-party providers of
       technology or products could be adversely affected;

     - Our relationships with employees and customers could be impaired;

     - Our due diligence process may fail to identify significant issues with
       product quality, product architecture, legal contingencies, and product
       development, among other things;

     - We may be subject to as a successor, certain liabilities of our
       acquisition targets; and

     - We may be required to sustain significant exit charges if products
       acquired in business combinations are unsuccessful.

IT MAY BECOME INCREASINGLY EXPENSIVE TO OBTAIN AND MAINTAIN LIABILITY INSURANCE
AT CURRENT LEVELS.

     We contract for insurance to cover a variety of potential risks and
liabilities. In the current market, insurance coverage is becoming more
restrictive and expensive, and when certain insurance coverage is offered, the
deductible for which we are responsible is larger. In light of these
circumstances, it may become more difficult to maintain insurance coverage at
historical levels, or if such coverage is available, the cost to
                                        50


obtain or maintain it may increase substantially. This may result in our being
forced to bear the burden of an increased portion of risks for which we have
traditionally been covered by insurance, which could negatively impact the
Company's results of operations.

ITEM 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS

     We are exposed to certain market risks in the ordinary course of our
business. These risks result primarily from changes in foreign currency exchange
rates and interest rates. In addition, our international operations are subject
to risks related to differing economic conditions, changes in political climate,
differing tax structures, and other regulations and restrictions.

     Foreign currency exchange rates.  Our international operations expose us to
foreign currency exchange rate changes that could impact translations of foreign
denominated assets and liabilities into U.S. dollars and future earnings and
cash flows from transactions denominated in different currencies. International
revenues represented 44% of total revenues in the year ended December 31, 2003
as compared to 43% and 44% in the years ended December 31, 2002 and 2001,
respectively. In addition, the identifiable net assets of our foreign operations
totaled 20% of consolidated net assets at December 31, 2003 and 2002. Our
exposure to currency exchange rate changes is diversified due to the number of
different countries in which we conduct business. We operate outside the United
States primarily through wholly owned subsidiaries in Europe, Asia/Pacific,
Canada and Latin America. We have determined that the functional currency of
each of our foreign subsidiaries is the local currency and as such, foreign
currency translation adjustments are recorded as a separate component of
stockholders' equity. Changes in the currency exchange rates of our foreign
subsidiaries resulted in our reporting unrealized foreign currency exchange
gains of $1.6 million and $1.9 million in 2003 and 2002, respectively.

     We did not engage in any material foreign currency hedging transactions
during 2002; however, during fourth quarter 2003 we began using derivative
financial instruments, primarily forward exchange contracts, to manage a
majority of the foreign currency exchange exposure associated with net
short-term foreign denominated assets and liabilities which exist as part of our
ongoing business operations. The exposures relate primarily to the gain or loss
recognized in earnings from the revaluation or settlement of current foreign
denominated assets and liabilities. We no not enter into derivative financial
instruments for trading or speculative purposes. The forward exchange contracts
generally have maturities of less than 90 days, and are not designated as
hedging instruments under SFAS No. 133. Forward exchange contracts are
marked-to-market at the end of each reporting period, with gains and losses
recognized in other income, net, offset by the gains or losses resulting from
the settlement of the underlying foreign denominated assets and liabilities.

     At December 31, 2003, we had forward exchange contracts with a notional
value of $10.3 million and an associated net forward contract liability of
$147,000, which is included in accrued expenses and other liabilities. At
December 31, 2002, we had forward exchange contracts with a notional value of
$1.0 million and an insignificant forward contract liability. The notional value
represents the amount of foreign currencies to be purchased or sold at maturity
and does not represent our exposure on these contracts. We do not anticipate any
material adverse impact to our financial statements as a result of these forward
exchange contracts.

     Foreign currency gains and losses will continue to result from fluctuations
in the value of the currencies in which we conduct operations as compared to the
U.S. Dollar, and future operating results will be affected to some extent by
gains and losses from foreign currency exposure. We prepared sensitivity
analyses of our exposures from foreign net working capital as of December 31,
2003 to assess the impact of hypothetical changes in foreign currency rates.
Based upon the results of these analyses, a 10% adverse change in all foreign
currency rates from the December 31, 2003 rates would result in a currency
translation loss of $1.7 million before tax.

     Interest rates.  We invest our cash in a variety of financial instruments,
including bank time deposits, and variable and fixed rate obligations of the
U.S. Government and its agencies, states, municipalities, commercial paper and
corporate bonds. These investments are denominated in U.S. dollars. We classify
all of our investments as available-for-sale in accordance with Statement of
Financial Accounting Standards No. 115, "Accounting for Certain Investments in
Debt and Equity Securities." Cash balances in foreign currencies
                                        51


overseas are operating balances and are invested in short-term deposits of the
local operating bank. Interest income earned on our investments is reflected in
our financial statements under the caption "Other income, net." Investments in
both fixed rate and floating rate interest earning instruments carry a degree of
interest rate risk. Fixed rate securities may have their fair market value
adversely impacted due to a rise in interest rates, while floating rate
securities may produce less income than expected if interest rates fall. Due to
these factors, our future investment income may fall short of expectations due
to changes in interest rates, or we may suffer losses in principal if forced to
sell securities that have suffered a decline in market value due to a change in
interest rates. We hold our investment securities for purposes other than
trading. The fair value of securities held at December 31, 2003 was $37.3
million, which is approximately the same as amortized cost, with interest rates
generally ranging between 1% and 2%.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     Our consolidated financial statements as of December 31, 2003 and 2002, and
for each of the three years in the period ended December 31, 2003, together with
the independent auditors' report of Deloitte & Touche LLP, are included in this
Form 10-K as listed in Item 14(a).

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

     None

ITEM 9A.  CONTROLS AND PROCEDURES

     During and subsequent to the reporting period, and under the supervision
and with the participation of our management, including our principal executive
officer and principal financial and accounting officer, we conducted an
evaluation of our disclosure controls and procedures, as such term is defined
under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), that were in effect at the end of the period
covered by this report. Based on their evaluation, our principal executive
officer and principal financial and accounting officer have concluded that our
disclosure controls and procedures that were in effect on December 31, 2003 were
effective to ensure that information required to be disclosed in our reports to
be filed under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in the Securities and Exchange Commission's
rules and forms. Other than the steps we took during 2003 to remediate certain
weaknesses in our IT area with respect to access security and change control,
there have been no significant changes in our internal controls over financial
reporting, or to our knowledge, in other factors that could significantly affect
these controls subsequent to December 31, 2003. While we have not identified any
material weakness or condition in our disclosure controls and procedures that
would cause us to consider them ineffective for their intended purpose, we
nevertheless have identified certain manual accounting procedures related to the
consolidation of our financial position that resulted in immaterial,
inappropriate classifications of the foreign currency translation adjustment in
our consolidated balance sheet. We have dedicated resources to correct this
issue and are in the process of implementing the necessary corrections. These
deficiencies did not have a material impact on the quality or accuracy of our
financial statements.

                                        52


                                    PART III

     Certain information required by Part III is omitted from this Form 10-K, as
we intend to file our Proxy Statement pursuant to Regulation 14A not later than
120 days after the end of the fiscal year covered by this Form 10-K, and certain
information included therein is incorporated herein by reference.

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     Our directors and executive officers, and their ages as of March 15, 2004,
are as follows:



NAME                            AGE                                      TITLE
- ----                            ---                                      -----
                                
James D. Armstrong............  53    Chairman
J. Michael Gullard (1), (3)...  59    Director
William C. Keiper (1).........  53    Director
Douglas G. Marlin (1), (2),     56    Director
  (3).........................
Jock Patton (1), (2), (3).....  58    Director
Hamish N. J. Brewer...........  41    President and Chief Executive Officer
Kristen L. Magnuson...........  47    Executive Vice President and Chief Financial Officer
Peter J. Charness.............  49    Senior Vice President, Global Marketing and Chief Product Officer
Scott D. Hines................  40    Senior Vice President, Chief Technology Officer and Global In-Store Systems
David R. King.................  59    Senior Vice President, Product Development
Christopher J. Moore..........  41    Senior Vice President, Customer Support Solutions
David J. Tidmarsh.............  52    Senior Vice President, Customer Success
Wayne J. Usie.................  37    Senior Vice President of the Americas


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

(1) Member of the Audit Committee

(2) Member of the Compensation Committee

(3) Member of the Nominating and Governance Committee

DIRECTORS:

     James D. Armstrong has been a Director since co-founding our Company in
1985 and currently serves as Chairman of the Board. Mr. Armstrong also served as
Co-Chairman of the Board from January 1999 to August 2000. Mr. Armstrong served
as our Chief Executive Officer from July 1999 to July 2003, as Co-Chief
Executive Officer from January 1999 to July 1999, and as Chief Executive Officer
from 1985 to October 1997. Mr. Armstrong founded JDA Software Services, Ltd., a
Canadian software development company, in 1978 and served as its President until
1987. Mr. Armstrong studied engineering at Ryerson Polytechnic Institute in
Toronto, Ontario.

     J. Michael Gullard has been a Director since January 1999. Mr. Gullard has
been the General Partner of Cornerstone Management, a venture capital and
consulting firm specializing in software and data communications companies since
1984. Mr. Gullard has also served as Chairman of Merant PLC (formerly Micro
Focus Group Ltd.), a publicly-held corporation headquartered in England with
extensive operations in the United States, that specializes in change management
software tools since 1996, and as Chairman of NetSolve, Incorporated, a
publicly-held corporation which provides IT infrastructure management services
on an out-sourced basis since 1992. Mr. Gullard is also a director of Celeritek
Inc., a publicly-held company which designs and manufactures gallium arsenide
(GaAs) semiconductor components and GaAs-based subsystems used in defense
electronics and commercial communication networks. Mr. Gullard has previously
served as Chief Executive Officer and Chief Financial Officer of
Telecommunications Technology, Inc. from 1979 to

                                        53


1984, and held a variety of financial and operational management positions at
Intel Corporation from 1972 to 1979. Mr. Gullard currently serves as Chairman of
Mainsoft Corp., a private company and has formerly served as a Director of other
technology companies. Mr. Gullard attended Stanford University where he received
a Bachelor of Arts Degree in Economics and a Masters Degree from the Graduate
School of Business.

     William C. Keiper has been a Director since April 1998. Mr. Keiper has
served as Chairman and Chief Executive Officer of Arrange Technology LLC, a
software development services outsourcing company since 2002 and as Managing
Partner of Black Diamond Group LLC, a management consulting firm since 2003.
From 1998 to 2002, Mr. Keiper served as President of Martin Wolf Securities LLC,
a mergers and acquisitions firm serving middle market IT services, consulting
and e-commerce companies. From 1997 to 1998, Mr. Keiper served as Managing
Director of Software Equity Group, LLC, a software and Internet technology
mergers, acquisitions and strategic consulting firm. Mr. Keiper was an officer
and member of the Board of Directors of Artisoft, Inc., a publicly-held software
company that develops and markets computer telephony and communications software
from 1993 to 1997, serving as Chief Executive Officer from 1993 to 1997, and as
Chairman of the Board from 1995 to 1997. From 1986 to 1993, Mr. Keiper held
variety of executive positions with MicroAge, Inc., a publicly-held distributor
and integrator of information technology products and services, including
President and Chief Operating Officer. MicroAge, Inc. was a Fortune Services 500
company. Mr. Keiper currently serves on the Board of Directors of several
technology companies, including Hypercom Corporation, a NYSE company that
provides point-of-sale card payment systems; Zones, Inc., a direct catalog
marketer of PC-related products and software; and Smith Micro Software, Inc., a
provider of application software and wireless solutions. Mr. Keiper received a
Bachelor of Science Degree in Business (finance major) from Eastern Illinois
University, a Juris Doctorate Degree from Arizona State University and a Masters
Degree in International Management from the Thunderbird American Graduate School
of International Management.

     Douglas G. Marlin has been a Director since May 31, 2001. Mr. Marlin served
as President and principal owner of Marlin Ventures, Inc., a Canadian-based
consulting firm, from 1997 to 2000. From 1987 to 1996, Mr. Marlin served as
President of JDA Software Services, Ltd., and from 1981 to 1987 as its Vice
President. Prior to that, Mr. Marlin served in a variety of technical and
development positions with IBM from 1973 to 1981. Mr. Marlin currently serves on
the Board of Directors of Zed I Solutions, a Canadian technology company that
develops hardware and software for real time industrial process monitoring, and
Aero-Mechanical Services Ltd, a Canadian technology company providing
Internet-based aircraft monitoring services. Mr. Marlin also serves as a
Director for various privately-held companies including Firetrace USA, LLP, a
fire suppression technology company. Mr. Marlin attended the University of
Calgary where he received a Bachelor of Science Degree in Mathematics.

     Jock Patton has been a Director since January 26, 1999. Mr. Patton is a
private investor and serves as Lead Trustee, Valuation Committee Chair and
Executive Committee member of the ING Funds, a $30 billion mutual fund complex.
Mr. Patton previously served as Chief Executive Officer of Rainbow Multimedia
Group, Inc., a producer of digital entertainment, from 1999 to 2001. From 1992
to 1997, Mr. Patton served as a Director and President of StockVal, Inc., an SEC
registered investment advisor providing securities analysis software and
proprietary data to mutual funds, major money managers and brokerage firms
worldwide. Prior to 1992, Mr. Patton was a Partner and Director in the law firm
of Streich Lang where he founded and headed the Corporate/Securities Practice
Group. Mr. Patton currently serves as the Lead Director of Hypercom Corporation,
a NYSE company that provides point-of-sale card payment systems. Mr. Patton has
previously served on the Board of Directors of various public and private
companies, including America West Airlines, Inc. Mr. Patton holds an A.B. Degree
in Political Science and Juris Doctorate, both from the University of
California.

OTHER EXECUTIVE OFFICERS:

     Hamish N. J. Brewer has served as our President and Chief Executive Officer
since August 2003. Mr. Brewer previously served as President from March 2001 to
July 2003, as Senior Vice President, Sales from 2000 to March 2001, as Senior
Vice President, Enterprise Systems, from 1999 to 2000, as Senior Vice President,
International during 1998 to 1999, as Director of our European, Middle East and
African operations
                                        54


from 1996 to 1998, and as a Marketing Representative from 1994 to 1996. Prior to
that, Mr. Brewer served as a Retail Marketing Specialist with IBM from 1986 to
1990, and in various operational positions with a privately-held retail sales
organization located in England. Mr. Brewer received a Bachelor of Science and a
Bachelor of Commerce Degree from the University of Birmingham in England.

     Kristen L. Magnuson has served as our Executive Vice President and Chief
Financial Officer since March 2001. Ms. Magnuson previously served as Senior
Vice President and Chief Financial Officer from September 1997 to March 2001.
Prior to that, Ms. Magnuson served as Vice President of Finance and Planning for
Michaels Stores, Inc., a publicly-held arts and craft retailer from 1990 to
1997, as Senior Vice President and Controller of MeraBank FSB, an $8 billion
financial institution, from 1987 to 1990, and various positions including Audit
Principal in the audit department of Ernst & Young from 1978 to 1987. Ms.
Magnuson is a Certified Public Accountant and received a Bachelor of Business
Administration Degree in Accounting from the University of Washington.

     Peter J. Charness has served as our Senior Vice President, Global Marketing
and Chief Product Officer since March 1999. Mr. Charness previously served as
our Vice President of Marketing and Strategy for the JDA Arthur Division from
1998 to 1999. Prior to that, Mr. Charness served as Vice President and General
Manager of the Retail Division of Comshare, Inc, a publicly-held software
company, from 1996 to 1998, as Vice President, Professional Services of Mitech
Computer Systems, Inc., a publicly-held software company, from 1995 to 1996, and
in various management positions including Vice President Logistics and
Technology of Dylex Ltd., a publicly-held Canadian retail sales company, from
1984 to 1995. Mr. Charness' education includes a CEGEP Diploma from McGill
University in Montreal, Quebec, a Bachelor of Arts Degree from York University
in Toronto, Ontario, and a Master of Business Administration Degree from the
University of Western Ontario.

     Scott D. Hines has served as our Senior Vice President, Chief Technology
Officer and Global In-Store Systems since January 2004. Mr. Hines previously
served as our Senior Vice President, Chief Technology Officer from 1999 to 2003,
as Vice President of In-store Systems from 1997 to 1998, as Director of Store
Systems Product Development from 1996 to 1997, and as Associate Director of
Store Systems Product Development from 1993 to 1996. Prior to that, Mr. Hines
served as Director of MIS for US Hosiery Corporation, a privately-held textile
manufacturing company, from 1991 to 1993, and as President of DataWorks, Inc., a
privately-held software development company, from 1987 to 1991. Mr. Hines
attended Carnegie Mellon University and received a Bachelor of Science Degree in
Molecular Biology.

     David R. King has served as our Senior Vice President, Product Development
since January 2004. Mr. King served as Vice President Product Planning of Geac
Computer Corp. Ltd, a publicly-held Canadian software company, from August 2003
to December 2003, as Sr. Vice President of Product Development and Chief
Technology Officer of Comshare, Inc., a publicly-held software company, from
1997 to 2003, and as its Director of Applied Technology and Research from 1991
to 1997, and in various management positions including Director, Advanced
Product Design and Development of Execucom Systems Corporation, a privately-held
provider of decision and executive support systems, from 1983 to 1991. Prior to
that, Mr. King was a full-time faculty member responsible for teaching
undergraduate and graduate courses in statistics, research methods, mathematical
and computer modeling at Old Dominion University, the University of Maryland,
and the University of South Carolina, from 1969 to 1982. Mr. King currently
serves on the advisory boards for MIS at the University of Georgia and the
International Academy of Advanced Decision Support at the Peter Kiewit Institute
of Technology. In addition, Mr. King has written over 50 articles and books in
the areas of decision support and business intelligence. Mr. King's education
includes a Bachelor of Sociology Degree, a Master of Sociology Degree, and a
Ph.D. in Sociology with a minor in Mathematical Statistics from the University
of North Carolina.

     Christopher J. Moore has served as our Senior Vice President, Customer
Support Solutions since January 2004. Mr. Moore previously served as our Vice
President, US Consulting Services from 1999 to 2003, as Vice President, CSG
Operations in 1999, as a Regional Director, CSG from 1997 to 1998, as Associate
Consulting Director from 1995 to 1997, as Senior Implementation Manager from
1994 to 1995, and in various other programmer, analyst and consulting positions
from 1991 to 1993. Prior to that, Mr. Moore served in various

                                        55


management positions with Vormittag Associates, Inc. a privately-held software
and consulting services distributor, from 1990 to 1991, Sunrise Software
Systems, a privately-held POS hardware and software distributor, from 1989 to
1990, and Computer Generated Solutions, a privately-held consulting company,
from 1987 to 1989. Mr. Moore attended Polytechnic University and received a
Bachelor of Science degree in Computer Science.

     David J. Tidmarsh has served as our Senior Vice President, Customer Success
since January 2004. Mr. Tidmarsh previously served as our Senior Vice President,
Client Services from January 1999 to December 2003. Prior to that, Mr. Tidmarsh
served as Vice President of Business Development with HNC Retek, a business unit
of HNC Software Inc., a publicly-held software solutions provider, from 1997 to
1998, as Chief Information Officer and Vice President of Logistics with Wilsons
The Leather Experts, a retail sales company, from 1993 to 1997, as Chief
Operating Officer of Page-Com, a publicly-held direct mail marketer of
communication equipment, and as Vice President of Merchandise Planning,
Allocation and Logistics with Pier One Imports, a specialty retail company, from
1987 to 1992. Mr. Tidmarsh attended Marquette University and received a Bachelor
of Arts Degree in Philosophy.

     Wayne J. Usie has served as our Senior Vice President of the Americas since
January 2003. Mr. Usie previously served as our Senior Vice President, Product
Development from January 2001 to December 2002. Prior to that, Mr. Usie served
as Vice President -- Information Technology for Family Dollar Stores, Inc., a
publicly-held mass merchant discount retailer from 1997 to 2000, as Vice
President -- Chief Financial Officer and Chief Information Officer of Campo
Electronics, Appliances, and Computers, Inc., a publicly-held consumer
electronics retailer, from 1996 to 1997, as President and Chief Executive
Officer of International Networking & Computer Consultants, Inc., a
privately-held software integration consulting firm, from 1992 to 1996, and in
various management positions in the regional accounting firm of Broussard,
Poche, Lewis & Breaux from 1988 to 1992. Mr. Usie attended Louisiana State
University and received a Bachelor of Science Degree in Business
Administration -- Accounting.

     In addition, we are actively recruiting from outside the Company to fill a
new position, Senior Vice President, Collaborative Solutions.

     Information relating to the designation of our Audit Committee Financial
Expert, beneficial ownership reporting compliance under Section 16(a) of the
Exchange Act, and the adoption of a Code of Ethics, is incorporated by reference
to the proxy statement under the captions "Corporate Governance -- Committees of
our Board of Directors," "Section 16(a) Beneficial Ownership Reporting
Compliance," "Report of the Audit Committee," and "Corporate Governance -- Code
of Business Conduct and Ethics."

ITEM 11.  EXECUTIVE COMPENSATION

     The information relating to executive compensation is incorporated by
reference to the Proxy Statement under the captions "Compensation of Directors,"
"Executive Compensation -- Summary Compensation Table," "Employment and Change
of Control Arrangements," "Option Grants in Last Fiscal Year," "Aggregate Option
Exercises During Fiscal 2003 and Year End Option Values," "Ten-Year Option
Repricing," "Compensation Committee Interlocks and Insider Participation,"
"Report of The Compensation Committee on Executive Compensation," and "Stock
Performance Graph."

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS

     The information relating to security ownership of certain beneficial owners
and management and related stockholder matters is incorporated by reference to
the Proxy Statement under the captions "Security Ownership of Certain Beneficial
Owners and Management," and "Securities Authorized for Issuance Under Equity
Compensation Plans."

                                        56


ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     The information relating to certain relationships and related transactions
is incorporated by reference to the Proxy Statement under the caption "Certain
Transactions."

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES

     The information relating to principal accountant fees and services is
incorporated by reference to the Proxy Statement under the captions "Report of
the Audit Committee," "Adoption of Policy for Approving Audit and Permitted
Non-Audit Services of the Independent Auditor," and "Principal Accounting Firm
Fees."

                                    PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     A. THE FOLLOWING DOCUMENTS ARE FILED AS PART OF THIS REPORT:

          1. FINANCIAL STATEMENTS
           Independent Auditors' Report
           Consolidated Balance Sheets -- December 31, 2003 and 2002
           Consolidated Statements of Income -- Three Years Ended December 31,
           2003
           Consolidated Statements of Stockholders' Equity and Comprehensive
           Income (Loss) -- Three Years Ended December 31, 2003
           Consolidated Statements of Cash Flows -- Three Years Ended December
           31, 2003
           Notes to Consolidated Financial Statements -- Three Years Ended
           December 31, 2003

          2. EXHIBITS -- SEE EXHIBIT INDEX.

     B. REPORTS ON FORM 8-K:

     We filed a Form 8-K dated October 20, 2003 with the Securities and Exchange
Commission on October 20, 2003 to furnish a copy of our October 20, 2003 press
release announcing financial results for the quarter ended September 30, 2003.
In addition, the Form 8-K included a discussion of the non-GAAP financial
measures of operating income, operating income as a percentage of revenues, and
earnings per share provided in the October 20, 2003 press release.

     The information provided in this report on Form 8-K and the Exhibits
attached thereto was furnished under "Item 12. Disclosure of Results of
Operations and Financial Condition." The information shall not be deemed "filed"
for purposes of Section 18 of the Exchange Act or otherwise subject to the
liabilities of that section, nor shall this report be deemed incorporated by
reference in any filing under the Securities Act of 1933 or the Exchange Act,
except as expressly set forth by specific reference in such filing.

                                        57


                          INDEPENDENT AUDITORS' REPORT

Board of Directors and Stockholders
JDA Software Group, Inc.
Scottsdale, Arizona

     We have audited the accompanying consolidated balance sheets of JDA
Software Group, Inc. and subsidiaries as of December 31, 2003 and 2002, and the
related consolidated statements of income, stockholders' equity, and cash flows
for each of the three years in the period ended December 31, 2003. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

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

     In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of JDA Software Group, Inc. and
subsidiaries as of December 31, 2003 and 2002, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 2003 in conformity with accounting principles generally accepted in
the United States of America.

     As discussed in Note 1 and Note 7 to the consolidated financial statements,
the Company changed its method of accounting for goodwill and intangibles with
indefinite lives as required by Statement of Financial Accounting Standards No.
142, "Goodwill and Other Intangible Assets," which was effective January 1,
2002.

DELOITTE & TOUCHE LLP

Phoenix, Arizona
March 12, 2004

                                        58


                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

                          CONSOLIDATED BALANCE SHEETS



                                                                  DECEMBER 31,
                                                              ---------------------
                                                                2003        2002
                                                              ---------   ---------
                                                              (IN THOUSANDS, EXCEPT
                                                                 SHARE AMOUNTS)
                                                                    
                                      ASSETS
Current Assets:
  Cash and cash equivalents.................................  $ 77,464    $ 71,065
  Marketable securities.....................................    37,266      30,790
                                                              --------    --------
                                                               114,730     101,855
  Accounts receivable, net..................................    40,162      47,077
  Income tax receivable.....................................     2,447       7,479
  Deferred tax asset........................................     4,863       5,564
  Prepaid expenses and other current assets.................    11,768      12,289
  Promissory note receivable................................     2,911          --
                                                              --------    --------
       Total current assets.................................   176,881     174,264
Property and Equipment, net.................................    21,944      21,337
Goodwill....................................................    62,397      59,801
Other Intangibles, net......................................    55,640      56,635
Promissory Note Receivable..................................        --       3,017
Deferred Tax Asset..........................................     3,763          --
                                                              --------    --------
          Total assets......................................  $320,625    $315,054
                                                              ========    ========

                       LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
  Accounts payable..........................................  $  2,568    $  3,020
  Accrued expenses and other liabilities....................    23,034      26,957
  Deferred revenue..........................................    25,234      23,331
                                                              --------    --------
          Total current liabilities.........................    50,836      53,308
Deferred Tax Liability......................................        --       4,980
Commitments and Contingencies (Notes 12 and 13)
Stockholders' Equity:
  Preferred stock, $.01 par value; authorized 2,000,000
     shares; none issued or outstanding.....................        --          --
  Common stock, $.01 par value; authorized, 50,000,000
     shares; issued 29,429,747 and 28,696,688 shares,
     respectively...........................................       294         287
  Additional paid-in capital................................   246,716     237,120
  Retained earnings.........................................    30,003      27,353
  Accumulated other comprehensive loss......................    (2,672)     (4,199)
                                                              --------    --------
                                                               274,341     260,561
  Less treasury stock, at cost, 414,702 and 339,702 shares,
     respectively...........................................    (4,552)     (3,795)
                                                              --------    --------
     Total stockholders' equity.............................   269,789     256,766
                                                              --------    --------
          Total liabilities and stockholders' equity........  $320,625    $315,054
                                                              ========    ========


                See notes to consolidated financial statements.
                                        59


                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

                       CONSOLIDATED STATEMENTS OF INCOME



                                                                     YEARS ENDED DECEMBER 31,
                                                              ---------------------------------------
                                                                 2003          2002          2001
                                                              -----------   -----------   -----------
                                                               (IN THOUSANDS, EXCEPT PER SHARE DATA)
                                                                                 
REVENUES:
  Software licenses.........................................   $ 59,283      $ 66,625      $ 71,220
  Maintenance services......................................     71,111        57,570        40,568
                                                               --------      --------      --------
     Product revenues.......................................    130,394       124,195       111,788
  Consulting services.......................................     70,167        87,608        95,124
  Reimbursed expenses.......................................      6,858         7,652         6,904
                                                               --------      --------      --------
     Service revenues.......................................     77,025        95,260       102,028
     Total revenues.........................................    207,419       219,455       213,816
                                                               --------      --------      --------
COST OF REVENUES:
  Cost of software licenses.................................      1,315         2,035         2,376
  Amortization of acquired software technology..............      4,518         4,247         2,971
  Cost of maintenance services..............................     17,373        14,292        11,159
                                                               --------      --------      --------
     Cost of product revenues...............................     23,206        20,574        16,506
  Cost of consulting services...............................     58,233        63,837        69,953
  Reimbursed expenses.......................................      6,858         7,652         6,904
                                                               --------      --------      --------
     Cost of service revenues...............................     65,091        71,489        76,857
     Total cost of revenues.................................     88,297        92,063        93,363
                                                               --------      --------      --------
GROSS PROFIT................................................    119,122       127,392       120,453
OPERATING EXPENSES:
  Product development.......................................     48,529        41,819        34,406
  Sales and marketing.......................................     41,612        39,941        37,998
  General and administrative................................     23,473        26,978        27,099
  Amortization of intangibles...............................      3,067         2,849         5,526
  Relocation costs to consolidate development and support
     activities.............................................      1,794           452            --
  Restructuring, asset disposition and other merger related
     charges................................................         --         6,287           985
  Purchased in-process research and development.............         --           800         2,361
  Gain on sale of office facility...........................       (639)           --            --
                                                               --------      --------      --------
     Total operating expenses...............................    117,836       119,126       108,375
                                                               --------      --------      --------
OPERATING INCOME............................................      1,286         8,266        12,078
  Other income, net.........................................      1,347         1,700         2,671
                                                               --------      --------      --------
INCOME BEFORE INCOME TAXES..................................      2,633         9,966        14,749
  Income tax (benefit) provision............................        (17)        1,036         5,101
                                                               --------      --------      --------
NET INCOME..................................................   $  2,650      $  8,930      $  9,648
                                                               ========      ========      ========
BASIC EARNINGS PER SHARE....................................   $    .09      $    .32      $    .38
                                                               ========      ========      ========
DILUTED EARNINGS PER SHARE..................................   $    .09      $    .31      $    .37
                                                               ========      ========      ========
SHARES USED TO COMPUTE:
  Basic earnings per share..................................     28,645        28,047        25,316
                                                               ========      ========      ========
  Diluted earnings per share................................     29,104        29,074        25,757
                                                               ========      ========      ========


                See notes to consolidated financial statements.
                                        60


                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                        AND COMPREHENSIVE INCOME (LOSS)



                                                                                     ACCUMULATED
                                         COMMON STOCK       ADDITIONAL                  OTHER
                                      -------------------    PAID-IN     RETAINED   COMPREHENSIVE   TREASURY
                                        SHARES     AMOUNT    CAPITAL     EARNINGS       LOSS         STOCK      TOTAL
                                      ----------   ------   ----------   --------   -------------   --------   --------
                                                            (IN THOUSANDS, EXCEPT SHARE AMOUNTS)
                                                                                          
Balance, January 1, 2001............  24,610,967    $246     $181,861    $ 8,775       $(2,798)     $(1,819)   $186,265
Issuance of common stock:
  Stock issued in acquisition.......   1,600,080      16       24,199                                            24,215
  Stock options exercised...........     433,286       4        4,226                                             4,230
  Employee stock purchase plan......     391,602       4        3,396                                             3,400
  Tax benefit -- stock
    compensation....................                              907                                               907
Purchase of treasury stock..........                                                                   (875)       (875)
Comprehensive income (loss):
  Net income........................                                       9,648                                  9,648
  Unrealized gain on marketable
    securities available-for-sale,
    net.............................                                                        22                       22
  Foreign translation adjustment....                                                    (3,362)                  (3,362)
                                                                                                               --------
    Comprehensive income............                                                                              6,308
                                      ----------    ----     --------    -------       -------      -------    --------
Balance, December 31, 2001..........  27,035,935     270      214,589     18,423        (6,138)      (2,694)    224,450
Issuance of common stock:
  Stock options exercised...........   1,324,768      13       12,615                                            12,628
  Employee stock purchase plan......     335,985       4        4,146                                             4,150
  Tax benefit -- stock
    compensation....................                            5,770                                             5,770
Purchase of treasury stock..........                                                                 (1,101)     (1,101)
Comprehensive income (loss):
  Net income........................                                       8,930                                  8,930
  Unrealized gain on marketable
    securities available-for-sale,
    net.............................                                                        26                       26
  Foreign translation adjustment....                                                     1,913                    1,913
                                                                                                               --------
    Comprehensive income............                                                                             10,869
                                      ----------    ----     --------    -------       -------      -------    --------
Balance, December 31, 2002..........  28,696,688     287      237,120     27,353        (4,199)      (3,795)    256,766
Issuance of common stock:
  Stock options exercised...........     348,056       3        3,728                                             3,731
  Employee stock purchase plan......     385,003       4        4,067                                             4,071
  Tax benefit -- stock
    compensation....................                              777                                               777
  Reversal of tax valuation
    allowance.......................                            1,024                                             1,024
Purchase of treasury stock..........                                                                   (757)       (757)
Comprehensive income (loss):
  Net income........................                                       2,650                                  2,650
  Unrealized loss on marketable
    securities available-for-sale,
    net.............................                                                        (3)                      (3)
  Foreign translation adjustment....                                                     1,530                    1,530
                                                                                                               --------
    Comprehensive income............                                                                              4,177
                                      ----------    ----     --------    -------       -------      -------    --------
Balance, December 31, 2003..........  29,429,747    $294     $246,716    $30,003       $(2,672)     $(4,552)   $269,789
                                      ==========    ====     ========    =======       =======      =======    ========


                See notes to consolidated financial statements.
                                        61


                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS



                                                                 YEARS ENDED DECEMBER 31,
                                                              ------------------------------
                                                                2003       2002       2001
                                                              --------   --------   --------
                                                                      (IN THOUSANDS)
                                                                           
OPERATING ACTIVITIES:
Net income..................................................  $  2,650   $  8,930   $  9,648
Adjustments to reconcile net income to net cash provided
  By Operating activities:
    Depreciation and amortization...........................    16,285     15,448     16,702
    Provision for doubtful accounts.........................       500      2,900      4,884
    Tax benefit -- stock options and employee stock purchase
     plan...................................................       777      5,770        907
    Net gain on disposal of property and equipment..........      (595)        15        130
    Write-off of purchased in-process research and
     development............................................        --        800      2,361
    Deferred income taxes...................................    (7,018)    (6,271)     1,159
Changes in assets and liabilities, net of effects from
  acquisitions:
  Accounts receivable.......................................     6,558     11,334     (7,099)
  Income tax receivable.....................................     5,017     (2,537)        91
  Prepaid expenses and other current assets.................     1,018     (2,211)    (2,729)
  Accounts payable..........................................      (453)       171     (2,640)
  Accrued expenses and other liabilities....................    (3,629)     1,207      3,858
  Deferred revenue..........................................      (267)     5,961      2,107
                                                              --------   --------   --------
    Net cash provided by operating activities...............    20,843     41,517     29,379
                                                              --------   --------   --------
INVESTING ACTIVITIES:
Purchase of marketable securities...........................   (58,363)   (46,767)   (12,242)
Sales of marketable securities..............................       100      9,701      2,500
Maturities of marketable securities.........................    51,784     18,443     13,424
Purchase of Engage, Inc.....................................    (3,349)        --         --
Purchase of Vista Software Solutions, Inc...................    (4,006)        --         --
Purchase of J -- Commerce, Inc..............................        --     (4,170)        --
Purchase of E3 Corporation, net of cash acquired............        --         --    (18,348)
Purchase of Neo Vista Decision Series.......................        --         --     (4,938)
Purchase of Zapotec Software, Inc...........................        --         --     (1,250)
Payment of direct costs related to the acquisition of E3
  Corporation...............................................      (708)    (8,583)    (6,048)
Issuance of promissory note receivable......................        --         --     (3,500)
Payments received on promissory note receivable.............       106        337        146
Purchase of property and equipment..........................   (10,395)    (8,262)    (6,815)
Proceeds from disposal of property and equipment............     2,022        448      1,478
                                                              --------   --------   --------
    Net cash used in investing activities...................   (22,809)   (38,853)   (35,593)
                                                              --------   --------   --------
FINANCING ACTIVITIES:
Issuance of common stock -- stock option plans..............     3,731     12,628      4,230
Issuance of common stock -- employee stock purchase plan....     4,071      4,150      3,400
Purchase of treasury stock..................................      (757)    (1,101)      (875)
Payments on capital leases..................................      (255)      (320)      (196)
Payments on line of credit, notes payable, and long-term
  debt assumed in the E3 Corporation acquisition............        --         --     (8,166)
                                                              --------   --------   --------
    Net cash provided by (used in) financing activities.....     6,790     15,357     (1,607)
                                                              --------   --------   --------
EFFECT OF EXCHANGE RATES ON CASH AND CASH EQUIVALENTS.......     1,575      1,179     (1,108)
                                                              --------   --------   --------
    Net increase (decrease) in cash and cash equivalents....     6,399     19,200     (8,929)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR................    71,065     51,865     60,794
                                                              --------   --------   --------
CASH AND CASH EQUIVALENTS, END OF YEAR......................  $ 77,464   $ 71,065   $ 51,865
                                                              ========   ========   ========


                                        62

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

              CONSOLIDATED STATEMENTS OF CASH FLOWS -- (CONTINUED)



                                                                 YEARS ENDED DECEMBER 31,
                                                              ------------------------------
                                                                2003       2002       2001
                                                              --------   --------   --------
                                                                      (IN THOUSANDS)
                                                                           
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
  Cash paid for income taxes................................  $  3,802   $  4,115   $  3,501
                                                              ========   ========   ========
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING ACTIVITIES:
Acquisition of Engage, Inc.:
  Fair value of fixed assets acquired.......................  $   (350)
  Software technology.......................................    (2,200)
  Customer lists............................................    (2,100)
  Goodwill..................................................      (306)
  Deferred revenue..........................................     1,488
                                                              --------
    Total acquisition cost of Engage, Inc...................    (3,468)
  Accruals for direct costs related to the transaction......       119
                                                              --------
    Total cash expended to acquire Engage, Inc..............  $ (3,349)
                                                              ========
Acquisition of Vista Software Solutions, Inc.:
  Fair value of current assets acquired.....................  $   (662)
  Software technology.......................................    (1,100)
  Customer lists............................................    (1,110)
  Other intangible assets...................................       (80)
  Goodwill..................................................    (2,290)
  Deferred revenue..........................................       681
                                                              --------
    Total acquisition cost of Vista Software Solutions,
     Inc....................................................    (4,561)
  Accruals for direct costs related to the transaction......       555
                                                              --------
    Total cash expended to acquire Vista Software Solutions,
     Inc....................................................  $ (4,006)
                                                              ========
Acquisition of J -- Commerce, Inc.:
  Software technology.......................................             $ (2,060)
  In-process research and development.......................                 (800)
  Goodwill..................................................               (1,325)
                                                                         --------
    Total acquisition cost of J -- Commerce, Inc............               (4,185)
  Accruals for direct costs related to the transaction......                   15
                                                                         --------
    Total cash expended to acquire J -- Commerce, Inc.......             $ (4,170)
                                                                         ========
Acquisition of E3 Corporation:
  Fair value of current assets acquired.....................                        $(14,036)
  Fair value of fixed assets acquired.......................                          (2,402)
  Goodwill..................................................                         (35,350)
  Software technology.......................................                         (12,600)
  Customer lists............................................                         (22,100)
  Trademarks................................................                          (3,300)
  In-process research and development.......................                          (2,200)
  Fair value of current liabilities assumed.................                          12,906
  Deferred revenue..........................................                           2,205
  Fair value of long-term debt assumed......................                           1,627
  Deferred tax liability, net...............................                          15,164
                                                                                    --------
    Total acquisition cost of E3 Corporation................                         (60,086)
  Reserves for direct costs related to the transaction......                          15,871
  Issuance of common stock..................................                          24,215
  Cash acquired.............................................                           1,652
                                                                                    --------
    Cash used to purchase E3 Corporation....................                        $(18,348)
                                                                                    ========
Acquisition of Neo Vista Decision Series:
  Fair value of fixed assets acquired.......................                        $     (5)
  Developed software and other intangibles..................                          (2,956)
  Goodwill..................................................                          (2,727)
  Fair value of current liabilities assumed.................                             750
                                                                                    --------
    Cash used to purchase Neo Vista Decision Series.........                        $ (4,938)
                                                                                    ========
Acquisition of Zapotec Software, Inc.:
  Fair value of current assets acquired.....................                        $    (14)
  Developed software and other intangibles..................                          (1,293)
  In-process research and development.......................                            (161)
  Fair value of current liabilities assumed.................                             218
                                                                                    --------
    Cash used to purchase Zapotec Software, Inc.............                        $ (1,250)
                                                                                    ========


                See notes to consolidated financial statements.
                                        63


                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                      THREE YEARS ENDED DECEMBER 31, 2003
  (IN THOUSANDS, EXCEPT PERCENTAGES, SHARES, PER SHARE AMOUNTS OR AS OTHERWISE
                                    STATED)

1.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Nature of Business.  We are a leading provider of sophisticated software
solutions designed specifically to address the demand and supply chain
management, business process, decision support, e-commerce, inventory
optimization, and collaborative planning and forecasting requirements of the
retail industry and suppliers to the retail industry. Our solutions enable
customers to manage and optimize their inventory flows throughout the demand
chain to the consumer, and provide optimized labor scheduling for retail store
operations. Our customers include approximately 4,500 of the world's leading
retail, consumer package goods ("CPG") manufacturers and wholesalers. We have
organized our business segments around the distinct requirements of retail
enterprises, retail stores, and suppliers to the retail industry. We employ
nearly 1,300 associates and conduct business from 35 offices in three geographic
regions: the Americas (includes the United States, Canada, and Latin America),
Europe (includes the Middle East and South Africa), and Asia/ Pacific. Our
corporate offices are located in Scottsdale, Arizona.

     Principles of Consolidation and Basis of Presentation.  The consolidated
financial statements include the accounts of JDA Software Group, Inc. and our
subsidiaries, all of which are wholly owned. All significant intercompany
balances and transactions have been eliminated in consolidation. The
consolidated financial statements are stated in U.S. dollars and are prepared
under accounting principles generally accepted in the United States.

     Use of Estimates.  The preparation of financial statements in conformity
with accounting principles generally accepted in the United States requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenue and
expenses during the reporting period. Significant estimates include the
allowance for doubtful accounts, which is based upon an evaluation of our
customers' ability to pay and general economic conditions; the useful lives of
property and equipment, the useful lives of intangible assets, which are based
upon valuation reports prepared by independent third party valuation
specialists; the recoverability or impairment of intangible asset values;
deferred revenue; reserves for the direct costs of acquisitions, and our
effective income tax rate and deferred tax assets which are based upon our
expectations of future taxable income, allowable deductions, and projected tax
credits. Actual results could differ from these estimates.

     Foreign Currency Translation.  The financial statements of our
international subsidiaries are translated into U.S. dollars using the exchange
rate at each balance sheet date for assets and liabilities and at an average
exchange rate for the revenues and expenses reported in each fiscal period. We
have determined that the functional currency of each foreign subsidiary is the
local currency and as such, foreign currency translation adjustments are
recorded as a separate component of stockholders' equity. Transaction gains and
losses, and unrealized gains and losses on short-term intercompany receivables
and payables and foreign denominated receivables, are included in results of
operations as incurred.

     Cash and Cash Equivalents and Marketable Securities.  Cash and cash
equivalents consist of cash held in bank demand deposits, money market
securities, and highly liquid investments with remaining maturities of three
months or less at the date of purchase. Marketable securities include U.S.
Government securities, commercial paper and corporate bonds. Management
determines the appropriate classification of debt and equity securities at the
time of purchase and re-evaluates such designation as of each balance sheet
date. All marketable securities are recorded at market value and have been
classified as available-for-sale at December 31, 2003 and 2002. Unrealized
holding gains and losses, net of the related income tax effect, are excluded
from earnings and are reported as a separate component of stockholders' equity
until realized. Dividend and interest income are recognized when earned.
Realized gains and losses for securities classified as available-for-sale are
determined using the specific identification method.
                                        64

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Accounts Receivable.  We typically provide installment payment terms on
most software license sales. Software licenses are generally due in installments
within twelve months from the date of delivery. All significant customers are
reviewed for creditworthiness before the Company licenses its software and we do
not sell our software or recognize any license revenue unless we believe that
collection is probable in accordance with the requirements of paragraph 8 in
Statement of Position 97-2, Software Revenue Recognition, as amended. We have a
history of collecting software payments when they come due without providing
refunds or concessions. Consulting services are generally billed bi-weekly and
maintenance services are billed annually or monthly. If a customer becomes
significantly delinquent or its credit deteriorates, we put the accounts on hold
and do not recognize any further services revenue (and in most cases we withdraw
support and/or our implementation staff) until the situation has been resolved.

     We do not have significant billing or collection problems. We review each
past due account and provide specific reserves based upon the information we
gather from various sources including our customers, subsequent cash receipts,
consulting services project teams, members of each region's management, and
credit rating services such as Dun and Bradstreet. Although infrequent and
unpredictable, from time to time certain of our customers have filed bankruptcy
and we have been required to refund the pre-petition amounts collected and
settle for less than the face value of its remaining receivable pursuant to a
bankruptcy court order. In these situations, as soon as it becomes probable that
the net realizable value of the receivable is impaired, we provide reserves on
the receivable. In addition, we monitor economic conditions in the various
geographic regions in which we operate to determine if general reserves or
adjustments to our credit policy in a region are appropriate for deteriorating
conditions that may impact the net realizable value of our receivables.

     Derivative Instruments and Hedging Activities.  We adopted Statement of
Financial Accounting Standard No. 133, Accounting for Derivative Instruments and
Hedging Activities ("SFAS No. 133"), effective January 1, 2001. SFAS No. 133
requires companies to value derivative financial instruments, including those
used for hedging foreign currency exposures, at current market value. In April
2003, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 149, Amendment of Statement 133 on Derivative
Instruments and Hedging Activities ("SFAS No. 149"). The provisions of SFAS No.
149 amend and clarify the accounting for derivative instruments, including
certain derivative instruments embedded in other contracts, and for hedging
activities under SFAS No. 133. SFAS No. 149 is effective for contracts entered
into or modified after June 30, 2003. The adoption of SFAS No. 133 and SFAS No.
149 did not have a significant impact on our financial statements.

     We did not engage in any material foreign currency hedging transactions
during 2002; however, during fourth quarter 2003 we began using derivative
financial instruments, primarily forward exchange contracts, to manage a
majority of the foreign currency exchange exposure associated with net
short-term foreign denominated assets and liabilities which exist as part of our
ongoing business operations. The exposures relate primarily to the gain or loss
recognized in earnings from the revaluation or settlement of current foreign
denominated assets and liabilities. We do not enter into derivative financial
instruments for trading or speculative purposes. The forward exchange contracts
generally have maturities of less than 90 days, and are not designated as
hedging instruments under SFAS No. 133. Forward exchange contracts are
marked-to-market at the end of each reporting period, with gains and losses
recognized in other income, net, offset by the gains or losses resulting from
the settlement of the underlying foreign denominated assets and liabilities.

     At December 31, 2003, we had forward exchange contracts with a notional
value of $10.3 million and an associated net forward contract liability of
$147,000, which is included in accrued expenses and other liabilities. At
December 31, 2002, we had forward exchange contracts with a notional value of
$1.0 million and an insignificant forward contract liability. The notional value
represents the amount of foreign currencies to be purchased or sold at maturity
and does not represent our exposure on these contracts. Gains and losses
resulting from foreign currency transactions were not significant in the years
ended December 31, 2003 and 2002.

                                        65

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Property and Equipment and Long-Lived Assets.  Property and equipment are
stated at cost less accumulated depreciation and amortization. Property and
equipment are depreciated on a straight-line basis over the following estimated
useful lives: computers, furniture, and fixtures -- two to seven years;
buildings -- twenty-five to forty years; automobiles -- three years; leasehold
improvements -- the shorter of the lease term or the estimated useful life of
the asset.

     Goodwill.  Goodwill represents the excess of the purchase price over the
net assets acquired in our business combinations. We adopted Statement of
Financial Accounting Standard No. 142, Goodwill and Other Intangible Assets
("SFAS No. 142"), effective January 1, 2002. SFAS No. 142 addresses how
intangible assets should be accounted for after they have been initially
recognized in the financial statements. SFAS No. 142 also requires that goodwill
and certain other intangible assets with indefinite useful lives no longer be
amortized, but instead be tested for impairment at least annually. Upon
adoption, we ceased amortization of goodwill and certain other intangible assets
we recorded in business combinations prior to June 30, 2001 (see Note 7).
Goodwill recorded in business combinations prior to June 30, 2001 was amortized
on a straight-line basis through December 31, 2001 over useful lives ranging
from 10 to 15 years.

     Intangible Assets.  Intangible assets consist of the values allocated to
software technology, customer lists and trademarks in connection with various
business combinations. Software technology is capitalized if the related
software product under development has reached technological feasibility or if
there are alternative future uses for the purchased software. Amortization of
software technology is reported as a cost of product revenues in accordance with
Financial Accounting Standards No. 86, Accounting for the Costs of Computer
Software to be Sold, Leased, or Otherwise Marketed ("SFAS No. 86"). Software
technology is amortized on a product-by-product basis and is determined as the
amount for each product that is the greater of the amount computed using (a) the
ratio that current gross revenues for a product bear to the total of current and
anticipated future revenue for that product, or (b) the straight-line method
over the remaining estimated economic life of the product including the period
being reported on. The estimated economic lives of our software technology
products range from 6 to 15 years.

     Amortization of customer lists is computed on a straight-line basis over
estimated useful lives ranging from 5 to 13 years. These intangible assets were
all acquired in business combinations over the last five years. Our valuation
process during the acquisitions, and the third party appraisals we obtained to
support our allocation of the purchase price to these assets, were based upon
the projected economic life of the customer base, using historical turnover
rates and discussions with the management of the acquired companies. The
historical life experiences of the acquired companies that were utilized in the
valuations support the economic lives used, as does the Company's historical
experience with similar customer accounts for products that have been developed
internally. The Company reviews the customer attrition rates for each
significant acquired customer group on a regular basis to ensure the rate of
attrition is not increasing and that revisions to our estimates of life
expectancy are not required.

     Substantially all of our capitalized trademarks were acquired in connection
with the acquisition of E3 Corporation (see Note 2). Beginning January 1, 2002,
we assigned indefinite useful lives to our trademarks, and ceased amortization,
as we believe there are no legal, regulatory, contractual, competitive,
economic, or other factors that would limit the useful lives of our trademarks.
We intend to indefinitely develop next generation products under our capitalized
trademarks, and expect these trademarks to contribute to our cash flows
indefinitely. Trademarks with indefinite useful lives are not subject to
amortization. However, in accordance with SFAS No. 142, the Company tests
trademarks for impairment annually or more frequently if events or changes in
circumstances indicate that the asset might be impaired (see Note 7).

     Restructuring, Asset Disposition and Other Merger Related Charges.  We
recorded restructuring, asset disposition and other merger related charges
during the second and fourth quarters of 2002, and in 2001, using the
authoritative guidance in Emerging Issues Task Force Issue No. 94-3 ("EITF No.
94-3"), Liability Recognition for Certain Employee Termination Benefits and
Other Costs to Exit an Activity (including
                                        66

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Certain Costs Incurred in a Restructuring). In June 2002, the Financial
Accounting Standards Board issued Statement of Financial Accounting Standards
No. 146, Accounting for Costs Associated with Exit or Disposal Activities ("SFAS
No. 146"). The provisions of SFAS No. 146 are effective for exit or disposal
activities that are initiated after December 31, 2002. SFAS No. 146 was adopted
effective January 1, 2003. SFAS No. 146 addresses financial accounting and
reporting for costs associated with exit or disposal activities and nullifies
EITF No. 94-3. Under SFAS No. 146, the liability for costs associated with exit
or disposal activities is recognized and measured initially at fair value only
when the liability is incurred, rather than at the date the Company committed to
the exit plan.

     Revenue Recognition.  We license software under non-cancelable agreements
and provide related services, including consulting, training and customer
support. We recognize revenue in accordance with Statement of Position 97-2
("SOP 97-2"), Software Revenue Recognition, as amended and interpreted by
Statement of Position 98-9, Modification of SOP 97-2, Software Revenue
Recognition, with respect to certain transactions, as well as Technical Practice
Aids issued from time to time by the American Institute of Certified Public
Accountants, and Staff Accounting Bulletin No. 101 ("SAB 101"), Revenue
Recognition in Financial Statements, that provides further interpretive guidance
for public companies on the recognition, presentation, and disclosure of revenue
in financial statements.

     Software license revenue is recognized when a license agreement has been
signed, the software product has been delivered, there are no uncertainties
surrounding product acceptance, the fees are fixed and determinable, and
collection is considered probable. If a software license contains an undelivered
element, the vendor-specific objective evidence ("VSOE") of fair value of the
undelivered element is deferred and the revenue recognized once the element is
delivered. The undelivered elements are primarily training, consulting and
maintenance services. VSOE of fair value for training and consulting services is
based upon hourly rates charged when those services are sold separately. VSOE of
fair value for maintenance is the price the customer will be required to pay
when it is sold separately (that is, the renewal rate). In addition, if a
software license contains customer acceptance criteria or a cancellation right,
the software revenue is recognized upon the earlier of customer acceptance or
the expiration of the acceptance period or cancellation right. Payments for our
software licenses are typically due in installments within twelve months from
the date of delivery. Although infrequent, where software license agreements
call for payment terms of twelve months or more from the date of delivery,
revenue is recognized as payments become due and all other conditions for
revenue recognition have been satisfied.

     Consulting and training services are separately priced, are generally
available from a number of suppliers, and are not essential to the functionality
of our software products. Consulting services, which include project management,
system planning, design and implementation, customer configurations, and
training are billed on both an hourly basis and under fixed price contracts.
Consulting services revenue billed on an hourly basis is recognized as the work
is performed. Training revenues are recognized when the training is provided and
is included in consulting revenues in the Company's consolidated statements of
income. Under fixed price contracts, consulting services revenue is recognized
using the percentage of completion method of accounting by relating hours
incurred to date to total estimated hours at completion.

     We have from time to time provided software and consulting services under
fixed price contracts that require the achievement of certain milestones.
Payment terms in these contracts are generally tied to customer acceptance of
the milestones. The revenue under such arrangements is recognized as the
milestones are achieved or upon customer acceptance. We believe that milestones
are a proper measure of progress under these contracts, as the milestones
approximate the percentage of completion method of accounting.

     Customer support services include post contract support and the rights to
unspecified upgrades and enhancements. Maintenance revenues from ongoing
customer support services are billed on a monthly basis and recorded as revenue
in the applicable month, or on an annual basis with the revenue being deferred
and recognized ratably over the maintenance period.
                                        67

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     If an arrangement includes multiple elements, the fees are allocated to the
various elements based upon VSOE of fair value, as described above.

     Reimbursable Out-of-Pocket Expenses.  We adopted Financial Accounting
Standards Board Emerging Issues Task Force Issue No. 01-14 ("EITF No. 01-14"),
Income Statement Characterization of Reimbursements Received for Out-of-Pocket
Expenses Incurred effective January 1, 2002. EITF No. 01-14 requires the
reclassification of reimbursed expenses in both service revenues and cost of
service revenues in our consolidated statements of income.

     Business Combinations.  The purchase method of accounting has been followed
on all of our business combinations and accordingly, the total purchase price of
each acquired company was allocated to the acquired assets and liabilities based
on their fair values (See Note 2). We adopted Statement of Financial Accounting
Standards No. 141, Business Combinations ("SFAS No. 141") effective January 1,
2002. SFAS No. 141 requires that the purchase method of accounting to be used
for all business combinations initiated after June 30, 2001 and prohibits the
use of the pooling-of-interest method. In addition, SFAS No. 141 provides
guidance on the initial recognition and measurement of goodwill arising from
business combinations initiated after June 30, 2001, and identifies the types of
acquired intangible assets that are to be recognized and reported separate from
goodwill.

     In-Process Research and Development.  In business combinations accounted
for using the purchase method of accounting, the amount of purchase price
allocated to in-process research and development ("IPR&D") is expensed at the
date of acquisition in accordance with FASB Interpretation No. 4, Applicability
of FASB Statement No. 2 to Business Combinations Accounted for by the Purchase
Method, an Interpretation of SFAS No. 2 (See Note 2). IPR&D consists of products
or technologies in the development stage for which technological feasibility has
not been established and which we believe have no alternative use. Amounts
allocated to IPR&D are shown as a separate line item in the consolidated
statements of income.

     Product Development.  The costs to develop new software products and
enhancements to existing software products are expensed as incurred until
technological feasibility has been established. We consider technological
feasibility to have occurred when all planning, designing, coding and testing
have been completed according to design specifications. Once technological
feasibility is established, any additional costs would be capitalized. We
believe our current process for developing software is essentially completed
concurrent with the establishment of technological feasibility, and accordingly,
no costs have been capitalized.

     Income Taxes.  Deferred tax assets and liabilities are recorded for the
estimated future tax effects of temporary differences between the tax basis of
assets and liabilities and amounts reported in the accompanying consolidated
balance sheets. We have reviewed projected future taxable income, other than the
reversal of temporary differences, and determined that a portion of our current
deferred tax asset at December 31, 2003 requires a valuation allowance as we
believe it is more likely than not that the deferred tax asset will not be
realized (see Note 16).

     Earnings per Share.  Basic earnings per share ("EPS") excludes the dilutive
effect of common stock equivalents and is computed by dividing net income or
loss by the weighted-average number of shares outstanding during the period.
Diluted EPS includes the effect of common stock equivalents, which consist of
stock options, and is computed using the weighted-average number of common and
common equivalent shares outstanding during the period. The weighted average
shares for fiscal 2003, 2002 and 2001 are reflected net of treasury shares (See
Notes 14 and 17).

     Stock-Based Compensation.  We do not record compensation expense for
options granted to our employees as all options granted under our stock option
plans have an exercise price equal to the market value of the underlying common
stock on the date of grant. In addition, we do not record compensation expense
for shares issued under our employee stock purchase plan. As permitted under
Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based
Compensation ("SFAS No. 123"), we have elected to
                                        68

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

continue to apply the provisions of Accounting Principles Board Opinion No. 25,
Accounting for Stock Issued to Employees ("APB No. 25") and provide pro forma
disclosure on an annual basis of net income (loss) and net income (loss) per
common share for employee stock option grants made as if the fair-value method
defined in SFAS No. 123 had been applied. We terminated our 1999 Employee Stock
Purchase Plan ("1999 Purchase Plan") in August 2003 (See Note 14).

     In December 2002, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 148, Accounting for Stock-Based
Compensation -- Transition and Disclosure ("SFAS No. 148) which is effective for
fiscal years ending after December 15, 2002. SFAS No. 148 amends SFAS No. 123 to
provide alternative methods of transition to SFAS No. 123's fair value method of
accounting for stock-based employee compensation if a company elects to account
for its equity awards under this method. SFAS No. 148 also amends the disclosure
provisions of SFAS No. 123 and APB Opinion No. 28, Interim Financial Reporting,
to require disclosure of the effects of an entity's accounting policy with
respect to stock-based employee compensation on reported net income and earnings
per share in both annual and interim financial statements.

     The following table presents pro forma disclosures required by SFAS No. 123
and SFAS No. 148 of net income (loss) and basic and diluted earnings (loss) per
share as if stock-based compensation expense had been recognized during the
three-year period ended December 31, 2003. The compensation expense for these
periods has been determined under the fair value method using the Black-Scholes
pricing model, and assumes graded vesting. The weighted average Black-Scholes
value per option granted in 2003, 2002 and 2001 was $8.83, $9.10 and $7.50,
respectively.



                                                  2003              2002          2001
                                           -------------------   -----------   -----------
                                                                      
Net income as reported...................  $             2,650   $     8,930   $     9,648
Less: stock-based compensation expense,
  net of related tax effects.............               (6,121)       (9,356)       (7,167)
                                           -------------------   -----------   -----------
Pro forma net income (loss)..............  $            (3,471)  $      (426)  $     2,481
Basic earnings per share -- as
  reported...............................  $               .09   $       .32   $       .38
Diluted earnings per share -- as
  reported...............................  $               .09   $       .31   $       .37
Basic earnings (loss) per share -- pro
  forma..................................  $              (.12)  $      (.02)  $       .10
Diluted earnings (loss) per share -- pro
  forma..................................  $              (.12)  $      (.02)  $       .10
ASSUMPTIONS:
Expected dividend yield..................                    0%            0%            0%
Expected stock price volatility..........                   90%           93%           81%
Risk-free interest rate..................                 2.25%         2.25%         3.85%
Expected life of option..................   2.63 to 3.17 years    2.96 years    3.13 years


     No expense has been recognized for stock-based compensation in the three
years ended December 31, 2003 as the underlying stock options were granted at
current market prices.

     Other New Accounting Pronouncements.  In January 2003, the Financial
Accounting Standards Board issued FASB Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities," which was subsequently revised in
December 2003. Variable interest entities are defined as entities with a level
of invested equity that is not sufficient to fund future activities to permit it
to operate on a stand alone basis. We do not participate in variable interest
entities.

     In May 2003, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 150, Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity ("SFAS No.
150"). SFAS No. 150 requires certain financial instruments that embody
obligations of

                                        69

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

the issuer, and which have characteristics of both liabilities and equity, to be
classified as liabilities. SFAS No. 150 is effective for financial instruments
entered into or modified after May 31, 2003. We do not have any financial
instruments, as defined in SFAS No. 150, that have characteristics of both
liabilities and equity.

2.  ACQUISITIONS

     Engage, Inc.  In August 2003, we acquired substantially all the remaining
assets of Engage, Inc. ("Engage") for a total cost of $3.5 million, which
includes the cash purchase price of $3.0 million plus $468,000 in direct costs
of the acquisition. Engage is a provider of enterprise advertising, marketing
and promotion software solutions that improve a retailer's promotion planning
process and their delivery of marketing and advertising content. Engage's
advanced digital asset, content management and ad layout capabilities will merge
with our existing PORTFOLIO REVENUE MANAGEMENT and PORTFOLIO KNOWLEDGE BASE
applications to further expand our JDA Portfolio with functionality that
streamlines the communication and collaboration among a retailer's
merchandising, promotions, production and store operation teams. The acquisition
was accounted for as a purchase, and accordingly, the operating results of
Engage have been included in our consolidated financial statements from the date
of acquisition. Pro forma operating results have not been presented as the
acquisition is not material to our consolidated financial statements. In
connection with the Engage acquisition, we recorded approximately $306,000 of
goodwill in our Retail Enterprise Systems reporting unit. The following
summarizes the fair values of the assets acquired and liabilities assumed at the
date of acquisition.

                                                           
Fair value of fixed assets acquired.........................  $   350
Software technology.........................................    2,200
Customer lists..............................................    2,100
Goodwill....................................................      306
Deferred revenue............................................   (1,488)
                                                              -------
  Total acquisition cost of Engage, Inc.....................    3,468
Accruals for direct costs related to the acquisition........     (119)
                                                              -------
  Total cash expended to acquire Engage, Inc................  $ 3,349
                                                              =======



     Vista Software Solutions, Inc.  In April 2003, we acquired substantially
all the intellectual property of Vista Software Solutions, Inc. ("Vista"), and
Vista's active customer agreements for a total cost of $4.6 million, which
includes the cash purchase price of $3.8 million plus $780,000 in direct costs
of the acquisition. Vista is a provider of collaborative business-to-business
software solutions that enable retailers and consumer goods manufacturers to
more efficiently synchronize and integrate data, including product descriptions,
product images, pricing and promotion information throughout their supply and
demand chains. Vista's solutions also enable consumer goods manufacturers to
manage trade promotions, minimize trade deductions costs and more accurately
forecast product demand. With this acquisition, we have expanded the JDA
Portfolio with complementary software products that leverage the Microsoft .Net
Platform and address the critical need for server-to-server data synchronization
in Internet-based collaborative commerce. The acquisition was accounted for as a
purchase, and accordingly, the operating results of Vista have been included in
our consolidated financial statements from the date of acquisition. Pro forma
operating results have not been presented as the acquisition is not material to
our consolidated financial statements. In connection with the Vista acquisition,
we recorded approximately $229,000 of goodwill in our Retail Enterprise Systems

                                        70

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

reporting unit and approximately $2.1 million of goodwill in our Collaborative
Solutions reporting unit. The following summarizes the fair values of the assets
acquired and liabilities assumed at the date of acquisition.

                                                           
Fair value of current assets acquired.......................  $  662
Software technology.........................................   1,100
Customer lists..............................................   1,110
Other intangible assets.....................................      80
Goodwill....................................................   2,290
Deferred revenue............................................    (681)
                                                              ------
  Total acquisition cost of Vista Software Solutions,
     Inc. ..................................................   4,561
Accruals for direct costs related to the acquisition........    (555)
                                                              ------
  Total cash expended to acquire Vista Software Solutions,
     Inc. ..................................................  $4,006
                                                              ======



     J -- Commerce Inc.  In April 2002, we acquired certain intellectual
property of J -- Commerce Inc. ("J -- Commerce"), a privately held Canadian
corporation, for a total cost of $4.2 million, which includes the purchase price
of $4.0 million plus $185,000 in direct costs of the acquisition. J -- Commerce
developed point-of-sale software solutions based on Java(TM) technology. We have
subsequently developed a Portfolio Point of Sales application ("PPOS") that
combines the J -- Commerce point-of-sale software technology with our
Internet-based Store Portal application to provide a complementary product
strategy with Win/DSS for larger retail customers that have annual sales in
excess of $5 billion and/or a large number of stores and/or registers per store.
The acquisition was accounted for as a purchase and accordingly, the operating
results of J -- Commerce have been included in our consolidated financial
statements from the date of acquisition. Pro forma operating results have not
been presented as the acquisition is not material to our consolidated financial
statements. In connection with the J -- Commerce acquisition, we expensed
$800,000 of purchased in-process research and development at the date of
acquisition, and recorded approximately $1.3 million of goodwill in our In-Store
Systems reporting unit. The following summarizes the fair values of the assets
acquired and liabilities assumed at the date of acquisition.

                                                           
Software technology.........................................  $2,060
In-process research and development.........................     800
Goodwill....................................................   1,325
                                                              ------
  Total acquisition cost of Engage, Inc.....................   4,185
Accruals for direct costs related to the acquisition........     (15)
                                                              ------
  Total cash expended to acquire Engage, Inc................  $4,170
                                                              ======



     E3 Corporation.  In September 2001, we completed the acquisition of E3
Corporation ("E3") for a total cost of $60.1 million, which includes $20 million
in cash and the exchange of 1,600,080 shares of our unregistered common stock
for all of the outstanding stock of E3 held by the former shareholders of E3, as
well as $5.4 million in fees and direct costs associated with the acquisition
and $10.5 million in restructuring costs to exit certain activities of E3. The
measurement date for the acquisition was September 4, 2001. That is the date
that the significant terms of the transaction were agreed to, including the
amount of consideration to be exchanged, and the number of shares to be issued
was known and would not change. In accordance with paragraph 4 of Financial
Accounting Standards Board Emerging Issues Task Force Issue No. 99-12 ("EITF No.
95-12"), Accounting for Formula Arrangements under Issue No. 95-19, the stock
consideration was valued at $17.86833 per share, which represents the average
stock price for the three trading days prior to the measurement date (August
29-31, 2001) and three trading days after the measurement date (September 4-6,
2001). September 1-3, 2001 fell over the Labor Day Holiday weekend and were not
trading days. The shares

                                        71

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

issued to acquire E3 were issued in a private transaction and were not subject
to immediate registration rights. The former E3 shareholders received
contractual rights to cause us to register up to 800,040, or 50% of the
unregistered shares beginning December 8, 2001, subject to certain limitations.
The per share consideration for these restricted shares was reduced by a 30%
valuation adjustment for the trading restrictions attached to the stock. The
former E3 shareholders also received the right to include their shares in any
registration initiated by us. The acquisition was accounted for as a purchase,
and accordingly, the operating results of E3 have been included in our
consolidated financial statements from the date of acquisition.

     The E3 product suite included inventory optimization systems such as
E3Trim, a warehouse and distribution center forecasting and replenishment
solution we now market as Advanced Warehouse Replenishment by E3, and E3Slim, a
store level forecasting and replenishment solution we now market as Advanced
Store Replenishment by E3; advanced analytic solutions such as Consumer
Outlook!, a data mining application for consumer behavior patterns, and Pin
Point!, an application that refines seasonal profile assignments which have
subsequently been incorporated in our INTELLECT series of advanced analytic
modules; and certain collaborative planning, forecasting and replenishment
("CPFR") solutions which we now market as MARKETPLACE REPLENISHMENT. As of
December 31, 2003, there were approximately 200 trading partners worldwide live
and operational on our MARKETPLACE REPLENISHMENT CPFR solution that enables
manufacturers, distributors and retailers to work from a single, shared demand
forecast. We believe that due to the acquisition of E3, we are now the leading
provider of inventory replenishment solutions to retailers and their suppliers.
Importantly, nearly 80% of E3's acquired customer base was non-retail and as a
result, we have accelerated our CPFR initiatives by gaining an immediate
presence in the wholesale and distribution industries that we had already
targeted for growth.

     In connection with the E3 acquisition, we expensed $2.2 million of
purchased in-process research and development at the date of acquisition, and
recorded approximately $24.1 million of goodwill in our Retail Enterprise
Systems reporting unit and approximately $11.3 million of goodwill in our
Collaborative Solutions reporting unit. The total acquisition cost of $60.1
million was allocated to the acquired assets and liabilities based on their fair
values.

     The following summarizes the fair values of the assets acquired and
liabilities assumed at the date of acquisition.

                                                           
Current assets acquired.....................................  $ 14,036
Fixed assets acquired.......................................     2,402
Software technology.........................................    12,600
Customer lists..............................................    22,100
Trademarks..................................................     3,300
In-process research and development.........................     2,200
Goodwill....................................................    35,350
                                                              --------
  Total assets acquired.....................................    91,988
Current liabilities assumed.................................   (12,906)
Deferred revenue............................................    (2,205)
Long-term debt assumed......................................    (1,627)
Deferred tax liability, net.................................   (15,164)
                                                              --------
  Total liabilities assumed.................................   (31,902)
                                                              --------
     Net assets acquired....................................  $ 60,086
                                                              ========



                                        72

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The trademarks recorded in this transaction have indefinite useful lives
that extend beyond the foreseeable future. The values allocated to goodwill and
trademarks will not be amortized but are subject to annual impairment tests (see
Note 7).

     In conjunction with the E3 acquisition, we recorded initial acquisition
reserves of approximately $14.6 million for restructuring costs to exit the
activities of E3 and other direct costs associated with the acquisition. These
costs related primarily to facility closures, employee severance, investment
banker fees, and legal and accounting costs. We subsequently increased the
purchase price and the E3 acquisition reserves by $1.3 million during 2002 based
on our revised estimates of the restructuring costs to exit the activities of E3
and the other direct costs of the acquisition. In third quarter 2003, we reduced
our estimate of employee severance and termination benefits costs by $172,000
based upon the final settlement with certain international employees and accrued
an additional $190,000 for facility termination and sublease costs based on our
revised estimate of the time required to sublease the vacated office space in
the current economic environment. Both adjustments were made through the income
statement. The unused portion of the acquisition reserves, which are included in
accrued expenses and other liabilities on the balance sheet, were approximately
$525,000 and $1.2 million at December 31, 2003 and 2002, respectively.

     A summary of the charges and adjustments recorded against the reserves is
as follows:



                                                           BALANCE                                        BALANCE
                         INITIAL     CASH      ADJ TO    DECEMBER 31,    CASH     NON-CASH    ADJ TO    DECEMBER 31,
DESCRIPTION OF CHARGE    RESERVE   CHARGES    RESERVES       2002       CHARGES   CHARGES    RESERVES       2003
- ---------------------    -------   --------   --------   ------------   -------   --------   --------   ------------
                                                                                
RESTRUCTURING CHARGES UNDER EITF 95-3:
Facility termination
  and sublease costs...  $ 4,689   $ (5,040)   $1,129       $  778       $(418)     $(25)     $ 190         $525
Employee severance and
  termination
  benefits.............    4,351     (4,115)      184          420        (248)                (172)          --
Termination payments to
  distributors.........      500       (100)     (400)          --          --        --         --           --
E3 user group and trade
  show cancellation
  fees.................       84        (72)      (12)          --          --        --         --           --
DIRECT COSTS UNDER SFAS NO. 141:
Legal and accounting
  costs................    2,344     (2,709)      407           42         (42)       --         --           --
Investment banker
  fees.................    2,119     (2,119)       --           --          --        --         --           --
Due diligence fees and
  expenses.............      350       (376)       26           --          --        --         --           --
Filing fees, appraisal
  services and transfer
  taxes................      110       (100)      (10)          --          --        --         --           --
                         -------   --------    ------       ------       -----      ----      -----         ----
  Total................  $14,547   $(14,631)   $1,324       $1,240       $(708)     $(25)     $  18         $525
                         =======   ========    ======       ======       =====      ====      =====         ====


     The facility termination and sublease costs are costs of a plan to exit an
activity of an acquired company as described in Financial Accounting Standards
Board Emerging Issues Task Force Issue No. 95-3 ("EITF No. 95-3"), Recognition
of Liabilities in Connection with a Purchase Business Combination, and include
the estimated costs of management's plan to shut down nine offices of E3 shortly
after the acquisition date. These costs have no future economic benefit to the
Company and are incremental to the other costs incurred by the Company or E3.
Immediately following the consummation of the E3 acquisition, the Company
engaged real estate advisers and began the necessary activities to shut down the
offices and sublet the locations or negotiate early termination agreements with
the various landlords. The most significant E3 facility (the former Corporate
Headquarters) was difficult to sublet and in July 2002 we settled with the
landlord by paying a $3.4 million lease termination fee. This resulted in a
$950,000 adjustment to the facility termination and
                                        73

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

sublease costs acquisition reserve. The remaining amounts in this reserve are
being paid out as the leases and any related subleases run through their
remaining terms.

     Employee severance and termination benefits are costs resulting from a plan
to involuntarily terminate employees from an acquired company as described in
EITF No. 95-3. As of the consummation date of the acquisition, executive
management approved a plan to involuntarily terminate approximately 31% of the
338 full time employees of E3. In the first three months following the
consummation of the E3 acquisition, management completed the assessment of which
employees would be involuntarily terminated and communicated the termination
arrangements to the affected employees in accordance with statutory requirements
of the local jurisdictions in which the employees were located. As of December
31, 2003, all employee severance and termination benefits have been paid.

     The following pro forma consolidated results of operations for the year
ended December 31, 2001 assume the E3 acquisition occurred as of January 1st of
that year. The pro forma results are not necessarily indicative of the actual
results that would have occurred had the acquisition been completed as of the
beginning of the period presented, nor are they necessarily indicative of future
consolidated results.



                                                               YEAR ENDED
                                                              DECEMBER 31,
                                                                  2001
                                                              ------------
                                                           
Total revenues..............................................    $224,782
Net income (loss)...........................................    $ (2,679)
Basic earnings (loss) per share.............................    $   (.11)
Diluted earnings (loss) per share...........................    $   (.11)


     NeoVista Decision Series.  In June 2001, we acquired certain assets of
Accrue Software, Inc. ("Accrue") for $4.9 million in cash. The acquired assets
include the NeoVista Decision Series ("Decision Series"), a comprehensive,
enterprise-level data mining toolset that enables retailers to design and build
applications that identify buying patterns and predictive relationships in their
business activity, and which are now marketed as modules of Intellect. In
addition to Decision Series, we acquired the RDS-Assort and RDS-Profile
products, which are now marketed as Channel Clustering by Intellect, and
Seasonal Profiling by Intellect, respectively. The acquisition was accounted for
as a purchase, and accordingly, the operating results of the acquired assets
have been included in our consolidated financial statements from the date of
acquisition. Pro forma operating results have not been presented, as the effect
of the acquisition is not material to our consolidated financial statements. The
following summarizes the fair values of the assets acquired and liabilities
assumed at the date of acquisition.

                                                           
Fixed assets acquired.......................................  $    5
Software technology.........................................   2,500
Customer lists..............................................     200
Assembled workforce.........................................     256
Goodwill....................................................   2,727
                                                              ------
  Total assets acquired.....................................   5,688
Current liabilities assumed.................................    (750)
                                                              ------
  Total liabilities assumed.................................    (750)
                                                              ------
     Net assets acquired....................................  $4,938
                                                              ======



     Amortization of goodwill and the assembled workforce intangible recorded in
this transaction ceased on December 31, 2001. The unamortized balance of
$213,000 on the assembled workforce intangible was reclassified to goodwill in
2002.

                                        74

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     Zapotec Software, Inc.  In February 2001, we acquired certain assets of
Zapotec Software, Inc. ("Zapotec") for $1.2 million in cash, and assumed certain
trade and other liabilities, and specific acquisition related liabilities for
consulting and maintenance obligations under assumed contracts. Zapotec's
primary product, ProMax, was a software solution that enabled retailers,
suppliers and distributors to manage their trade allowance and promotional
programs by automating the contract fulfillment, claim generation and accounts
receivable process. We now market the ProMax functionality as VENDOR INCENTIVE
MANAGEMENT ("VIM"). In addition to ProMax, we acquired the Ad Plan application.
The Ad Plan technology was the basis for the development of our MARKETING
EXPENSE MANAGEMENT ("MEM") application. The acquisition was accounted for as a
purchase, and accordingly, the operating results of Zapotec have been included
in our consolidated financial statements from the date of acquisition. The
following summarizes the fair values of the assets acquired and liabilities
assumed at the date of acquisition.

                                                           
Current assets acquired.....................................  $   14
Software technology.........................................   1,143
Customer lists..............................................      55
Assembled workforce.........................................      85
Trademarks..................................................      10
In-process research and development.........................     161
                                                              ------
  Total assets acquired.....................................   1,468
Current liabilities assumed.................................    (218)
                                                              ------
  Total liabilities assumed.................................    (218)
                                                              ------
     Net assets acquired....................................  $1,250
                                                              ======



     The allocated value for IPR&D of $161,000 was expensed at the date of
acquisition. Amortization on the assembled workforce intangible recorded in this
transaction ceased on December 31, 2001 and the unamortized balance of $58,000
was reclassified to goodwill in 2002.

     The following pro forma consolidated results of operations for the year
ended December 31, 2001 assume the Zapotec acquisition occurred as of January
1st of that year. The pro forma results are not necessarily indicative of the
actual results that would have occurred had the acquisition been completed as of
the beginning of the period presented, nor are they necessarily indicative of
future consolidated results.



                                                               YEAR ENDED
                                                              DECEMBER 31,
                                                                  2001
                                                              ------------
                                                           
Total revenues..............................................    $206,923
Net income..................................................    $  9,532
Basic earnings per share....................................    $    .38
Diluted earnings per share..................................    $    .37


3.  SUBSEQUENT EVENT -- ACQUISITION OF TIMERA RETAIL SOLUTIONS

     On January 29, 2004 we acquired the intellectual property and certain other
assets of Timera Retail Solutions ("Timera"), for a total cost of $14.2 million,
which includes the purchase price of $13.0 million plus $1.2 million in direct
costs of the acquisition. Timera is a provider of integrated workforce
management solutions for the retail and consumer goods industry. Timera's
Enterprise Workforce Management product suite will expand our JDA Portfolio and
complement our existing IN-STORE SYSTEMS with web-based functionality for labor
scheduling and budgeting, time and attendance, demand forecasting, labor
tracking, and other key processes for proactive store level labor management.
The acquisition will be accounted for as a

                                        75

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

purchase, and accordingly, the operating results of Timera will be included in
our consolidated financial statements from the date of acquisition. In
connection with the Timera acquisition, we have extended employment offers to 51
former Timera employees, approximately two-thirds of which are in product
development. The final purchase price allocation has not been completed, however
we currently expect to record approximately $9.0 million of goodwill in our
In-Store Systems reporting unit, $4.6 million in software technology, and $1.1
million for customer lists. Pro forma operating results will not be presented as
the acquisition is not material to our consolidated financial statements.

4.  MARKETABLE SECURITIES

     We invest our excess cash in short-term, interest-bearing instruments that
have a low risk of capital loss, such as U.S. government securities, commercial
paper and corporate bonds, and money market securities. Commercial paper must be
rated "1" by 2 of the 5 nationally recognized statistical rating organizations.
Corporate bonds must be rated Aa2 or AA or better by Moody's and S&P,
respectively. All marketable securities held at December 31, 2003 have
contractual maturities of one year or less. Expected maturities could differ
from contractual maturities as borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties. The amortized cost,
gross unrealized gains and losses and fair value of marketable securities at
December 31, 2003 and 2002 are as follows:



                                                            GROSS        GROSS
                                              AMORTIZED   UNREALIZED   UNREALIZED   MARKET
                                                COST        GAINS        LOSSES      VALUE
                                              ---------   ----------   ----------   -------
                                                                        
2003
U.S. Government agencies....................   $30,676       $48          $--       $30,724
Corporate...................................     6,544         1            3         6,542
                                               -------       ---          ---       -------
  Marketable securities.....................   $37,220       $49          $ 3       $37,266
                                               =======       ===          ===       =======
2002
U.S. Government agencies....................   $18,881       $66          $--       $18,947
Corporate...................................    11,858         7           22        11,843
                                               -------       ---          ---       -------
  Marketable securities.....................   $30,739       $73          $22       $30,790
                                               =======       ===          ===       =======


5.  ACCOUNTS RECEIVABLE, NET

     At December 31, 2003 and 2002 accounts receivable consist of the following:



                                                               2003      2002
                                                              -------   -------
                                                                  
Trade receivables...........................................  $43,154   $53,077
Less allowance for doubtful accounts........................   (2,992)   (6,000)
                                                              -------   -------
  Total.....................................................  $40,162   $47,077
                                                              =======   =======


     A summary of changes in the allowance for doubtful accounts for the
three-year period ended December 31, 2003 is as follows:



                                                           2003      2002      2001
                                                          -------   -------   -------
                                                                     
Balance at beginning of period..........................  $ 6,000   $ 4,971   $ 5,954
Provision for doubtful accounts.........................      500     2,900     4,884
Deductions, net.........................................   (3,508)   (1,871)   (5,867)
                                                          -------   -------   -------
Balance at end of period................................  $ 2,992   $ 6,000   $ 4,971
                                                          =======   =======   =======


                                        76

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The provision for doubtful accounts recorded in 2002 and 2001 includes
amounts related to large bankruptcy filings. Delays typically occur between the
periods in which we record a provision for doubtful accounts related to a large
bankruptcy filing, and the period in which the actual uncollectible receivable
balances are written-off. This results from our policy of waiting until final
settlement of the bankruptcy proceeding, or until there is a negotiated
settlement of the pre-petition balances, before charging the uncollectible
receivable balances against the allowance for doubtful accounts.

6.  PROPERTY AND EQUIPMENT, NET

     At December 31, 2003 and 2002 property and equipment consist of the
following:



                                                                2003       2002
                                                              --------   --------
                                                                   
Computers, furniture & fixtures.............................  $ 59,136   $ 52,116
Land and buildings..........................................     2,294      3,058
Automobiles.................................................       131        248
Leasehold improvements......................................     5,979      6,088
                                                              --------   --------
                                                                67,540     61,510
Less accumulated depreciation and amortization..............   (45,596)   (40,173)
                                                              --------   --------
                                                              $ 21,944   $ 21,337
                                                              ========   ========


     In April 2003, we sold a freestanding 5,000 square foot office facility in
the United Kingdom for approximately $1.6 million and recognized a gain of
$639,000. Subsequent to December 31, 2003, we purchased our corporate office
facility for approximately $23.8 million in cash. This transaction closed on
February 5, 2004. The purchase includes the corporate office building, a new
two-story parking garage, and approximately 8.8 acres of land upon which these
structures are located.

     Depreciation expense for the three years ended December 31, 2003 was $8.7
million, $8.3 million, and $8.2 million, respectively.

7.  GOODWILL AND OTHER INTANGIBLES, NET

     At December 31, 2003 and 2002 goodwill and other intangible assets consist
of the following:



                                          DECEMBER 31, 2003               DECEMBER 31, 2002
                                    -----------------------------   -----------------------------
                                    GROSS CARRYING   ACCUMULATED    GROSS CARRYING   ACCUMULATED
                                        AMOUNT       AMORTIZATION       AMOUNT       AMORTIZATION
                                    --------------   ------------   --------------   ------------
                                                                         
Goodwill..........................     $ 62,397        $     --        $ 59,801        $     --
                                       --------        --------        --------        --------
Other intangibles:
Amortized intangible assets
  Customer Lists..................       39,598          (8,964)         36,348          (5,897)
  Software technology.............       35,060         (13,754)         31,721          (9,237)
Unamortized intangible assets
  Trademarks......................        3,700              --           3,700              --
                                       --------        --------        --------        --------
                                         78,358         (22,718)         71,769         (15,134)
                                       --------        --------        --------        --------
                                       $140,755        $(22,718)       $131,570        $(15,134)
                                       ========        ========        ========        ========


     During the year ended December 31, 2003, we recorded approximately $306,000
in goodwill in connection with our acquisition of certain assets of Engage,
Inc., and approximately $2.3 million in connection with our acquisition of
certain intellectual property of Vista Software Solutions, Inc. During the year
ended

                                        77

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

December 31, 2002, we recorded $1.3 million in goodwill in connection with our
acquisition of certain intellectual property of J -- Commerce Inc. We also
recorded an additional $3.3 million in goodwill during 2002 as a result of
certain adjustments made to the estimated fair values of assets and liabilities
assumed in the acquisition of E3 and a reduction in the amount of deferred tax
asset recorded on this transaction to reflect our revised estimate of the
anticipated future tax benefits from acquisition costs incurred and research and
development credits. No goodwill was impaired or written-off during the years
ended December 31, 2003 or 2002. As of December 31, 2003, goodwill has been
allocated to our reporting units as follows: $42.6 million to Retail Enterprise
Systems, $1.3 million to In-Store Systems, and $18.5 million to Collaborative
Solutions.

     Pursuant to SFAS No. 142, we performed an initial test for goodwill
impairment as of January 1, 2002, and an initial test for trademark impairment
during the three months ended March 31, 2002. In addition, we have completed our
required annual tests for goodwill and trademark impairment during the fourth
quarters of 2003 and 2002. We have found no indication of impairment of the
goodwill or trademarks allocated to our reporting units. Accordingly, absent
future indications of impairment, the next annual impairment tests will be
performed in fourth quarter 2004.

     We reviewed the customer attrition rates for each significant acquired
customer group in fourth quarter 2003 to ensure that the rate of attrition is
not increasing and our estimates of life expectancy for our customer lists are
appropriate. There were no adjustments required.

     Amortization expense for the three years ended December 31, 2003 was $7.6
million, $7.1 million and $8.5 million, respectively, and is shown as separate
line items in the consolidated statements of income within cost of revenues and
operating expenses. We expect amortization expense for the next five years to be
as follows:

                                                           
2004........................................................  $8,043
2005........................................................  $7,793
2006........................................................  $7,605
2007........................................................  $6,440
2008........................................................  $5,325



     The following table reconciles net income and earnings per share as
reported for years ended December 31, 2003, 2002 and 2001 to net income and
earnings per share as adjusted to exclude amortization expense, net of taxes,
related to goodwill and other intangible assets that are no longer being
amortized.



                                                           FOR THE YEAR ENDED DECEMBER 31,
                                                          ---------------------------------
                                                            2003        2002        2001
                                                          ---------   ---------   ---------
                                                                         
RECONCILIATION OF REPORTED NET INCOME:
  Reported net income...................................   $ 2,650     $ 8,930     $ 9,648
  Pro forma amortization adjustments:
     Goodwill...........................................        --          --       1,970
     Assembled workforce................................        --          --         513
     Trademarks.........................................        --          --          31
                                                           -------     -------     -------
     Adjusted net income................................   $ 2,650     $ 8,930     $12,162
                                                           =======     =======     =======


                                        78

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)



                                                           FOR THE YEAR ENDED DECEMBER 31,
                                                          ---------------------------------
                                                            2003        2002        2001
                                                          ---------   ---------   ---------
                                                                         
BASIC EARNINGS PER SHARE:
  Reported net income...................................   $   .09     $   .32     $   .38
  Pro forma amortization adjustments:
     Goodwill...........................................        --          --         .08
     Assembled workforce................................        --          --         .02
     Trademarks.........................................        --          --          --
                                                           -------     -------     -------
     Adjusted net income................................   $   .09     $   .32     $   .48
                                                           =======     =======     =======
DILUTED EARNINGS PER SHARE:
  Reported net income...................................   $   .09     $   .31     $   .37
  Pro forma amortization adjustments:
     Goodwill...........................................        --          --         .08
     Assembled workforce................................        --          --         .02
     Trademarks.........................................        --          --          --
                                                           -------     -------     -------
     Adjusted net income................................   $   .09     $   .31     $   .47
                                                           =======     =======     =======
SHARES USED TO COMPUTE:
  Basic earnings per share..............................    28,645      28,047      25,316
  Diluted earnings per share............................    29,104      29,074      25,757


8.  PROMISSORY NOTE RECEIVABLE

     In May 2001, we entered into a secured promissory note agreement with
Silvon Software, Inc. ("Silvon") under which we agreed to loan Silvon $3.5
million. We license certain applications from Silvon for use in our IDEAS
product. The loan is collateralized by a first priority security interest in all
of Silvon's intellectual property and a subordinated security interest in
accounts receivable and all other assets. The promissory note bears interest at
prime plus 1.5 percentage points, which is payable monthly. The agreement
provides for periodic payments towards the principal balance through the
retention of a portion of the royalties we owe Silvon from sales of the IDEAS
product, with any remaining accrued and unpaid interest and principal due and
payable on May 8, 2004. As of December 31, 2003 the entire promissory note
receivable has been classified as a current asset. We considered the entire
promissory note receivable balance long-term as of December 31, 2002 as the only
principal payments required to be made during 2003 were contingent upon future
sales of the IDEAS product which were not assured.

9.  ACCRUED EXPENSES AND OTHER LIABILITIES

     At December 31, 2003 and 2002, accrued expenses and other liabilities
consist of the following:



                                                               2003      2002
                                                              -------   -------
                                                                  
Accrued compensation and benefits...........................  $13,138   $13,127
Restructuring and asset disposition charges.................      718     3,577
Accrued sales, VAT and property taxes.......................    2,104     2,771
Acquisition related reserves................................    1,133     1,240
Other accrued expenses......................................    5,941     6,242
                                                              -------   -------
  Total.....................................................  $23,034   $26,957
                                                              =======   =======


                                        79

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

10.  RESTRUCTURING, ASSET DISPOSITION AND OTHER MERGER RELATED CHARGES AND
     RELOCATION COSTS TO CONSOLIDATE DEVELOPMENT AND SUPPORT ACTIVITIES

     We recorded a $1.3 million restructuring charge in second quarter 2002 for
a workforce reduction of 53 full-time employees ("FTE"), primarily in the
consulting services function in the Americas and Europe. All workforce
reductions associated with this charge were made on or before June 30, 2002. All
employees potentially impacted by this restructuring were notified of the plan
of termination and the related benefits on or before June 30, 2002.

     We recorded a restructuring charge of $5.0 million in fourth quarter 2002
for the workforce reduction and office closure costs to reorganize the Company
in connection with the implementation of the Customer Value Program ("CVP"), a
worldwide initiative designed to (i) refocus the organization on delivering
value to our existing customer base, (ii) strengthen our competitive position,
(iii) improve the quality, satisfaction and efficiency of our customers'
experience with JDA, (iv) increase revenue, (v) better align our cost structure,
and (vi) improve our operating results.

     Implementation of the CVP included adjustments to our workforce and a
reallocation of our resources in response to a fundamental shift in the way we
develop product and bring it to market, as well as to changes in the demand for
the various types of products we sell, the length of implementation efforts
required and associated skill requirements. The workforce reduction enabled us
to better align our cost structure during the recent economic downturn, which
has adversely impacted our revenues, elongated our selling cycles, and delayed,
suspended or reduced the demand for certain of our products. The reorganization
resulted in the consolidation of nearly all product development and client
support activities at our corporate headquarters, a workforce reduction of
approximately 204 FTE and certain office closures. The workforce reduction
included certain employees involved in product development (55 FTE) and client
support services (22 FTE) who chose not to relocate, and reductions in
consulting services personnel (62 FTE), sales and marketing personnel (37 FTE),
and administrative functions (28 FTE). We have hired, expect to hire, or have
transferred from other departments within the Company, approximately 45 FTE in
product development and client support services to replace those individuals who
have chosen not to relocate to our corporate headquarters. All employees
potentially impacted by this reorganization were notified of the plan of
termination and the related benefits on or before December 31, 2002. Office
closure costs pertain to certain US, Latin American, and European offices that
were either under-performing or became redundant with the reorganization.

     Approximately 150 people were offered the opportunity to relocate as part
of the CVP initiative to consolidate our development and client support
activities at our corporate headquarters. As of December 31, 2003, a total of 50
employees have relocated. We negotiated temporary retention arrangements ranging
from nine months to two years with 42 employees who have chosen not to relocate
in order to facilitate a smooth transition. We have subsequently offered
indefinite full-time employment to 19 of these employees, who we believe are
strategic to our current development efforts, and rescinded their retention
arrangements. We have incurred $2.2 million in relocation costs through December
31, 2003, including $1.8 million and $452,000 in 2003 and 2002, respectively, to
consolidate our development and client support activities at our corporate
headquarters. The relocation costs have been reported in income from continuing
operations as incurred. Accordingly, there were no accrued liabilities
associated with these charges at December 31, 2003 or 2002.

                                        80

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     A summary of the 2002 restructuring and office closure charges included in
accrued expenses and other liabilities is as follows:



                                                                  BALANCE                                       BALANCE
                                                       LOSS ON      AT                 LOSS ON                    AT
                                  INITIAL    CASH     DISPOSAL    DEC 31,    CASH     DISPOSAL    ADJUSTMENTS   DEC 31,
DESCRIPTION OF THE CHARGE         RESERVE   CHARGES   OF ASSETS    2002     CHARGES   OF ASSETS   TO RESERVE     2003
- -------------------------         -------   -------   ---------   -------   -------   ---------   -----------   -------
                                                                                        
Severance, benefits and legal
  costs.........................  $5,204    $(2,635)    $ --      $2,569    $(2,211)    $ --         $(197)      $161
Office closure costs............   1,083        (28)     (47)      1,008       (570)     (77)          196        557
                                  ------    -------     ----      ------    -------     ----         -----       ----
  Total.........................  $6,287    $(2,663)    $(47)     $3,577    $(2,781)    $(77)        $  (1)      $718
                                  ======    =======     ====      ======    =======     ====         =====       ====


     During 2003, we reduced our estimate of severance, benefits and legal costs
by $197,000, primarily as a result of our decision to offer indefinite full-time
employment to certain employees previously subject to temporary retention
arrangements, and accrued an additional $196,000 for office closure costs based
on our revised estimate of the time required to sublease the vacated office
space in the current economic environment. Both adjustments were made through
the income statement. The remaining balance for severance, benefits and legal
costs represents the unpaid amounts under a disputed termination agreement with
a foreign employee. The remaining balance for office closure costs is being paid
out as the leases and any related subleases run through their remaining terms.

     During 2001, we recorded restructuring, asset disposition and other merger
related charges of $749,000 in first quarter 2001 and an additional $236,000 in
fourth quarter 2001. The restructuring initiatives involved a workforce
reduction of 41 FTE including certain employees involved in implementation and
maintenance services (17 FTE), product development activities (7 FTE), sales and
marketing (10 FTE), and administrative functions (7 FTE), related in part to the
acquisition of E3. All workforce reductions associated with these charges were
made on or before March 31, 2001 or December 31, 2001, as appropriate. Office
closure costs pertain to certain European offices that became redundant after
the E3 acquisition (See Note 2). Other charges consist of the write-off of
certain merger and acquisition costs related to a potential acquisition that was
abandoned. A summary of the 2001 restructuring, asset disposition and other
merger related charges is as follows:



                                            INITIAL    CASH     NON-CASH      BALANCE AT
DESCRIPTION OF THE CHARGE                   RESERVE   CHARGES   CHARGES    DECEMBER 31, 2002
- -------------------------                   -------   -------   --------   -----------------
                                                               
Severance, benefits and related legal
costs.....................................   $727      $(727)     $--            $  --
Office closure costs......................     50        (46)      (4)              --
Other Charges.............................    208       (208)      --               --
                                             ----      -----      ---            -----
  Total...................................   $985      $(981)     $(4)           $  --
                                             ====      =====      ===            =====


11.  DEFERRED REVENUE

     At December 31, 2003 and 2002, deferred revenue consists of deferrals for
software license fees, maintenance, consulting and training and other services
as follows:



                                                               2003      2002
                                                              -------   -------
                                                                  
Software....................................................  $ 1,141   $ 1,124
Maintenance.................................................   21,658    19,060
Consulting..................................................    1,842     2,335
Training and other..........................................      593       812
                                                              -------   -------
                                                              $25,234   $23,331
                                                              =======   =======


                                        81

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

12.  LEASE COMMITMENTS

     Our corporate office is located in Scottsdale, Arizona, where we currently
occupy approximately 121,000 square feet of a 136,000 square foot facility and
have expansion rights on the remaining space. The corporate office is also used
for certain of our sales, marketing, consulting, customer support, training, and
product development functions. The lease on the corporate office, which
commenced in April 1999, has an initial term of ten years and a scheduled
monthly rate of approximately $135,000 that is effective through March 2004. In
June 2003, we agreed to take the remaining 15,000 square feet, effective
November 2004, and extended the term of lease through December 2014. Subsequent
to December 31, 2003, we purchased our corporate office facility for
approximately $23.8 million in cash. This transaction closed on February 5,
2004. The purchase includes the corporate office building, a new two-story
parking garage, and approximately 8.8 acres of land upon which these structures
are located.

     We lease office space in the Americas for 15 regional sales and support
offices across the United States, Canada and Latin America, and for 18
international sales and support offices located in major cities throughout
Europe, Asia, Australia, and Japan. The leases are primarily noncancellable
operating leases and expire at various dates through the year 2014. Certain of
the leases contain renewal options. We expect that in the normal course of
business some or all of these leases will be renewed or that suitable additional
or alternative space will be available on commercially reasonable terms as
needed. In addition, we lease various computers, telephone systems, automobiles,
and office equipment under noncancellable leases with terms generally ranging
from 36 to 60 months. Certain of the equipment leases contain renewal options
and we expect that in the normal course of business some or all of these leases
will be renewed or replaced by other leases.

     Rental expense under operating leases was $6.8 million in 2003, $7.7
million in 2002, and $6.8 million in 2001. The following summarizes future
minimum lease payments under noncancellable operating leases with minimum or
remaining lease terms in excess of one year at December 31, 2003, and excludes
$22.9 million in scheduled minimum lease payments on our corporate office
facility that we purchased on February 5, 2004.

                                                          
2004.......................................................  $ 5,717
2005.......................................................    4,747
2006.......................................................    3,021
2007.......................................................    1,574
2008.......................................................    1,292
Thereafter.................................................    3,828
                                                             -------
  Total future minimum lease payments......................  $20,179
                                                             =======



     In connection with the acquisition of E3 we provided reserves for direct
costs related to certain sublease obligations on redundant facilities. At of
December 31, 2003, these reserves represent $525,000 of the total minimum lease
payments shown above (See Note 2).

13.  LEGAL PROCEEDINGS

     We are involved in legal proceedings and claims arising in the ordinary
course of business. Although there can be no assurance, management does not
believe that the disposition of these matters will have a material adverse
effect on our business, financial position, results of operations or cash flows.

                                        82

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

14.  STOCKHOLDERS' EQUITY

     Preferred Stock Purchase Rights Plan.  We adopted a Preferred Stock
Purchase Rights Plan (the "Rights Plan") in October 1998 designed to deter
coercive or unfair takeover tactics and to prevent a person or a group from
gaining control of our Company without offering a fair price to all
stockholders.

     Under the terms of the Rights Plan, a dividend distribution of one
Preferred Stock Purchase Right ("Right") for each outstanding share of our
common stock was made to holders of record on October 20, 1998. These Rights
entitle the holder to purchase one one-hundredth of a share of our Series A
Preferred Stock ("Preferred Stock") at an exercise price of $100. The Rights
become exercisable (a) 10 days after a public announcement that a person or
group has acquired shares representing 15% or more of the outstanding shares of
common stock, or (b) 10 business days following commencement of a tender or
exchange offer for 15% or more of such outstanding shares of common stock.

     We can redeem the Rights for $0.001 per Right at any time prior to their
becoming exercisable. The Rights expire on October 1, 2008, unless we redeem
them earlier or they are exchanged for common stock. Under certain
circumstances, if a person or group acquires 15% or more of our common stock,
the Rights permit stockholders other than the acquirer to purchase common stock
having a market value of twice the exercise price of the Rights, in lieu of the
Preferred Stock. In addition, in the event of certain business combinations, the
Rights permit stockholders to purchase the common stock of an acquirer at a 50%
discount. Rights held by the acquirer will become null and void in both cases.

     Treasury Stock Repurchase Program.  In July 2002, our Board of Directors
authorized a repurchase of up to two million shares of our outstanding common
stock on the open market at prevailing market prices during a one-year period
ended July 22, 2003. We repurchased a total of 175,000 shares of our common
stock for $1.8 million under this program, including 75,000 shares for $757,000
in 2003 and 100,000 shares for $1.1 million in 2002.

     In October 2000, our Board of Directors authorized a repurchase of up to
two million shares of our outstanding common stock on the open market at
prevailing market prices during a one-year period ended October 21, 2001. We
repurchased a total of 239,000 shares of our common stock for $2.7 million under
this program.

     Stock Option Plans.

     Our 1995 Stock Option Plan (the "1995 Option Plan") was approved by
stockholders and provided for the issuance of up to 2,025,000 shares of common
stock to employees under incentive and nonstatutory stock option grants.
Incentive and nonstatutory stock options were granted under the 1995 Option Plan
at prices not less than the fair market value of the common stock at the date of
grant. The options generally became exercisable over periods ranging from 18 to
48 months, commencing at the date of grant, and expire in ten years. The 1995
Option Plan was terminated effective April 24, 2001 except for those provisions
necessary to the administration of any outstanding options at the time of
termination. No further grants will be made under the 1995 Option Plan.
Accordingly, in 2001 we reduced the number of reserved shares under our stock
option plans by the 169,883 unissued shares that expired upon termination of the
1995 Option Plan.

     Our 1996 Stock Option Plan (the "1996 Option Plan") was approved by
stockholders and currently provides for the issuance of up to 8,200,000 shares
of common stock to employees, consultants and directors under incentive and
nonstatutory stock option grants. The 1996 Option Plan contains certain grant
restrictions and limitations that prohibit us from (i) granting more than
1,200,000 shares common stock subject to new options in any 12-month period
(commencing May 25, 2000), subject to any stock split, re-capitalization,
dividend or related events, (ii) re-pricing any options granted under the 1996
Option Plan, and (iii) granting any options under the 1996 Option Plan with an
exercise price below fair market value of the common stock at the date of grant.
The options granted under the 1996 Option Plan generally vest over a three or
four-year

                                        83

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

period, commencing at the date of grant, and expire in ten years. Certain
options granted to executive officers during the year ended December 31, 2002
have shorter vesting periods and provide for accelerated vesting upon a change
of control in the Company's ownership. Beginning in January 2003, the standard
form of option agreement was modified to provide for a contractual term on new
grants equal to the vesting period of the option plus three years. The 1996
Option Plan has no scheduled termination date.

     Our 1996 Outside Director Stock Option Plan (the "1996 Directors Plan") was
approved by stockholders and provides for the issuance of up to 225,000 shares
of common stock to eligible participants under nonstatutory stock option grants.
Under the 1996 Directors Plan, outside directors receive a one-time grant to
purchase 18,750 shares upon appointment to the Board of Directors, and an annual
option grant to purchase 6,000 shares for each year of service thereafter. The
nonstatutory stock options may be granted at a price not less than the fair
market value of the common stock at the date of grant. The options generally
vest over a three-year period commencing at the date of grant, and expire in ten
years. The 1996 Directors Plan has no scheduled termination date.

     Our 1998 Nonstatutory Stock Option Plan (the "1998 Option Plan") has not
been approved by stockholders. The 1998 Option Plan currently provides for the
issuance of up to 762,500 shares of common stock to employees under nonstatutory
stock option grants and permits option grants to executive officers under
certain conditions. The 1998 Option Plan was amended in October 2001 to increase
the number of shares of common stock reserved for issuance from 412,500 to
762,500. The nonstatutory stock options may be granted at a price not less than
the fair market of our common stock on the date of grant. Options granted under
the 1998 Option Plan during the three-year period ended December 31, 2003
generally vest over a three to four-year period commencing at the date of grant
and expire over periods ranging from five years to ten years. Beginning in
January 2003, the standard form of option agreement was modified to provide for
a contractual term on new grants equal to the vesting period of the option plus
three years. Certain options granted to executive officers during the year ended
December 31, 2002 have shorter vesting periods and provide for accelerated
vesting upon a change of control in the Company's ownership. The 1998 Option
Plan has no scheduled termination date.

                                        84

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The following summarizes the combined stock option activity during the
three-year period ended December 31, 2003:



                                                                    OPTIONS OUTSTANDING
                                                               -----------------------------
                                           OPTIONS AVAILABLE                 EXERCISE PRICE
                                               FOR GRANT         SHARES        PER SHARE
                                           -----------------   ----------   ----------------
                                                                   
Balance, January 1, 2001.................      2,996,591        4,248,127   $ 2.33 to $37.25
  Increase in reserved shares............        350,000               --                 --
  Plan shares expired....................       (169,883)              --                 --
  Granted................................     (1,429,063)       1,429,063   $ 9.31 to $16.89
  Cancelled..............................        213,879         (213,879)  $ 7.88 to $17.19
  Exercised..............................             --         (474,418)  $ 2.33 to $14.63
                                              ----------       ----------
Balance, December 31, 2001...............      1,961,524        4,988,893   $ 2.33 to $37.25
  Increase in reserved shares............             --               --                 --
  Granted................................     (2,116,200)       2,116,200   $ 8.50 to $28.20
  Cancelled..............................        501,268         (501,268)  $ 8.56 to $21.01
  Exercised..............................             --       (1,324,768)  $ 2.83 to $26.96
                                              ----------       ----------
Balance, December 31, 2002...............        346,592        5,279,057   $ 2.33 to $37.25
  Increase in reserved shares............      1,200,000               --                 --
  Granted................................       (451,350)         451,350   $10.33 to $17.00
  Cancelled..............................        268,085         (268,085)  $ 8.56 to $26.96
  Exercised..............................             --         (348,056)  $ 6.44 to $16.89
                                              ----------       ----------
Balance, December 31, 2003...............      1,363,327        5,114,266   $ 2.33 to $37.25
                                              ==========       ==========


     The following summarizes certain weighted average information on options
outstanding at December 31, 2003:



                                           OPTIONS OUTSTANDING
                                  -------------------------------------    OPTIONS EXERCISABLE
                                                  WEIGHTED                ----------------------
                                                  AVERAGE      WEIGHTED                 WEIGHTED
                                                 REMAINING     AVERAGE                  AVERAGE
                                    NUMBER      CONTRACTUAL    EXERCISE     NUMBER      EXERCISE
RANGE OF EXERCISE PRICES          OUTSTANDING   LIFE (YEARS)    PRICE     EXERCISABLE    PRICE
- ------------------------          -----------   ------------   --------   -----------   --------
                                                                         
$2.33 to $2.83..................       7,502        1.75        $ 2.83         7,500     $ 2.83
$6.44 to $9.69..................     783,036        5.43        $ 8.62       775,128     $ 8.62
$10.00 to $15.75................   2,857,471        7.46        $12.30     1,784,984     $12.57
$16.00 to $23.85................   1,302,539        6.65        $19.74       685,197     $20.93
$24.47 to $37.25................     163,718        5.73        $28.16       122,816     $28.51
                                   ---------                               ---------
                                   5,114,266                               3,375,625
                                   =========                               =========


     Employee Stock Purchase Plan.

     Our 1999 Employee Stock Purchase Plan ("1999 Purchase Plan") was approved
by stockholders. The 1999 Purchase Plan provides eligible employees the ability
to purchase our common stock semi-annually at 85% of the lesser of (1) the fair
market value on the first day of the 24-month offering period, or (2) the fair
market value on the last day of each semi-annual purchase period. The 1999
Purchase Plan provides for the initial issuance of 750,000 shares with an
automatic annual increase, beginning August 1, 2000 through August 1, 2009,
equal to the lesser of 750,000 shares or such lesser amount of shares as
determined by the

                                        85

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Board. The shares reserved for issuance under the 1999 Purchase Plan were
increased by 750,000 shares in both August 2001 and August 2002. We terminated
the 1999 Purchase Plan in August 2003. During 2001, 391,602 shares were
purchased at prices ranging from $8.02 to $11.05. During 2002, 335,985 shares
were purchased at prices ranging from $10.64 to $17.40. During 2003, 385,003
shares were purchased at prices ranging from $10.57 to $10.58.

     In January 2002 the Securities and Exchange Commission adopted new rules
for the disclosure of equity compensation plans. The purpose of the new rules is
to summarize the potential dilution that could occur from past and future equity
grants under all equity compensation plans. The following provides tabular
disclosure of the number of securities to be issued upon the exercise of
outstanding options, the weighted average exercise price of outstanding options,
and the number of securities remaining available for future issuance under
equity compensation plans, aggregated into two categories -- plans that have
been approved by stockholders and plans that have not:



                           NUMBER OF SECURITIES TO    WEIGHTED-AVERAGE       NUMBER OF SECURITIES REMAINING
                           BE ISSUED UPON EXERCISE    EXERCISE PRICE OF    AVAILABLE FOR FUTURE ISSUANCE UNDER
EQUITY COMPENSATION PLANS  OF OUTSTANDING OPTIONS    OUTSTANDING OPTIONS        EQUITY COMPENSATION PLANS
- -------------------------  -----------------------   -------------------   -----------------------------------
                                                                  
Approved by stockholders:
1995 Option Plan.......               7,502                $2.833                              --
1996 Option Plan.......           4,506,372                $14.01                       1,234,162
1996 Directors Plan....             139,480                $18.64                          45,417
1999 Purchase Plan.....                  --                    --                              --
                                  ---------                ------                       ---------
                                  4,653,354                $14.13                       1,279,579
Not approved by stockholders:
1998 Option Plan.......             460,912                $14.04                          83,748
                                  ---------                ------                       ---------
                                  5,114,266                $14.12                       1,363,327
                                  =========                ======                       =========


     During the three years ended December 31, 2003, certain employees exercised
options or sold stock acquired under the stock purchase plan in disqualifying
dispositions that resulted in deductions for income tax purposes. Our tax
liability for 2003, 2002, and 2001 was reduced by $777,000, $5,770,000 and
$907,000, respectively, to give effect to these dispositions with an offsetting
credit to additional paid-in capital.

15.  EMPLOYEE BENEFIT PLANS

     We maintain a defined 401(k) contribution plan (401(k) Plan) for the
benefit of our employees. Participant contributions vest immediately and are
subject to the limits established from time-to-time by the Internal Revenue
Service. We provide discretionary matching contributions to the 401(k) Plan on
an annual basis. Our matching contributions, which vest over a five-year graded
vesting schedule, were 12% per year for the three years ended December 31, 2003.
Beginning January 1, 2004, we increased our matching contribution to 25% and now
provide 100% vesting after 2 years of service. Our matching contributions to the
401(k) Plan were $486,000, $489,000, and $362,000 in 2003, 2002 and 2001,
respectively.

                                        86

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

16.  INCOME TAXES

     The provision for income taxes includes income taxes currently payable and
those deferred due to temporary differences between the financial statement and
tax bases of assets and liabilities that will result in taxable or deductible
amounts in the future. The components of the provision for income taxes included
in the Consolidated Statements of Income are as follows:



                                                            2003      2002      2001
                                                           -------   -------   ------
                                                                      
Current taxes:
  Federal and state......................................  $ 4,550   $ 5,534   $2,440
  Foreign................................................    2,451     1,773    1,502
                                                           -------   -------   ------
     Total current taxes.................................    7,001     7,307    3,942
Deferred taxes...........................................   (7,018)   (6,271)   1,159
                                                           -------   -------   ------
       Income tax provision (benefit)....................  $   (17)  $ 1,036   $5,101
                                                           =======   =======   ======


     The deferred tax benefit in 2003 results primarily from the capitalization,
for income tax purposes, of certain research and development costs. The deferred
tax benefit in 2002 results from the transfer of our research and development
credit carryforwards from current income tax receivables to a long-term deferred
tax asset.

     The provision for income taxes differed from the amounts computed by
applying the statutory U.S. federal income tax rate of 34% in 2003, and 35% in
2002 and 2001 to income before income taxes as a result of the following:



                                                            2003     2002      2001
                                                            -----   -------   -------
                                                                     
Federal statutory rate....................................  $ 896   $ 3,489   $ 5,162
Research and development credit...........................   (712)   (1,104)   (1,025)
Meals, entertainment, goodwill amortization and other non-
  deductible expenses.....................................    147       129       923
State income taxes........................................     86       194       289
Foreign rate differential.................................    464    (2,023)      140
Income tax audit resolution...............................     --    (1,919)     (365)
Change in deferred tax valuation allowance................   (976)    2,456        --
Other.....................................................     78      (186)      (23)
                                                            -----   -------   -------
     Income tax provision (benefit).......................  $ (17)  $ 1,036   $ 5,101
                                                            =====   =======   =======


                                        87

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     The income tax effects of temporary differences that give rise to our
deferred income tax assets and liabilities are as follows:



                                                      2003                    2002
                                              ---------------------   ---------------------
                                              CURRENT   NON-CURRENT   CURRENT   NON-CURRENT
                                              -------   -----------   -------   -----------
                                                                    
Deferred tax asset:
  Accruals and reserves.....................  $3,043      $    --     $3,906      $    --
  Deferred revenue..........................     826           --        932           --
  Foreign deferred and NOL..................   1,010          920        744           --
  Tax credit carryforwards..................      --        4,215         --        7,900
  R&D Expenses Capitalized..................      --        7,931
  AMT Credit Carryforward...................      --          223
  Other.....................................      --           --         --           42
                                              ------      -------     ------      -------
     Deferred tax asset.....................   4,879       13,289      5,582        7,942
Valuation allowance on deferred tax asset...      --       (1,481)        --       (3,481)
                                              ------      -------     ------      -------
Deferred tax liability:
  Property and equipment....................      --         (144)        --         (982)
  Goodwill and other intangibles............      --       (7,901)        --       (8,428)
  Other.....................................     (16)          --        (18)         (31)
                                              ------      -------     ------      -------
     Deferred tax liability.................     (16)      (8,045)       (18)      (9,441)
       Total................................  $4,863      $ 3,763     $5,564      $(4,980)
                                              ======      =======     ======      =======


     Residual United States income taxes have not been provided on undistributed
earnings of our foreign subsidiaries. These earnings are considered to be
indefinitely reinvested and, accordingly, no provision for United States federal
and state income taxes has been provided thereon. Upon distribution of those
earnings in the form of dividends or otherwise, the Company would be subject to
both United States income taxes and withholding taxes payable to various foreign
countries less an adjustment for foreign tax credits. It is not practicable to
estimate the amount of additional tax that might be payable on the foreign
earnings. The Company has incurred net operating losses in certain foreign
jurisdictions that will be carried forward to future years.

     From time to time, we may be subject to audit by federal, state and/or
foreign taxing authorities. During 2002, we recognized a benefit of $1.9 million
that related primarily to the resolution of an audit by the Inland Revenue of
our United Kingdom subsidiaries for the years 1997 through 2000, and a tentative
settlement in the United States of an income tax examination by the Internal
Revenue Service of our 1998 and 1999 federal income tax returns. Under the
settlement, the Internal Revenue Service agreed to allow the Company to take a
research and development expense tax credit for most of the qualifying expenses
originally reported in the Company's corporate income tax returns for those
years.

     At December 31, 2003, we had approximately $2.7 million of federal research
and development tax credit carryforwards that expire at various dates through
2023. We also had approximately $1.5 million of foreign tax credit carryforwards
that expire beginning in 2004. In 2002, we established a valuation allowance of
$3.5 million for foreign tax credit carryovers due to our excess credit
position. We subsequently elected in third quarter 2003 to capitalize a
significant portion of our research and development costs in the 2002 federal
income tax return, which allowed us to more fully utilize certain tax credits
that could not previously be realized. With this election, we reversed $2.3
million of the previously recorded valuation allowance, which resulted in a
one-time tax benefit of approximately $1.0 million, and an increase to
additional paid in capital of

                                        88

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

$1.0 million. At December 31, 2003 the valuation allowance was $1.5 million
because we believe that it is more likely than not that the foreign tax credits
carryforwards will not be realized.

17.  EARNINGS PER SHARE

     Earnings per share for the three years ended December 31, 2003 is
calculated as follows:



                                                           2003      2002      2001
                                                          -------   -------   -------
                                                                     
Net income..............................................  $ 2,650   $ 8,930   $ 9,648
                                                          -------   -------   -------
Shares -- Basic earnings per share......................   28,645    28,047    25,316
Common stock equivalents................................      459     1,027       441
                                                          -------   -------   -------
Shares -- Diluted earnings per share....................   29,104    29,074    25,757
                                                          =======   =======   =======
Basic earnings per share................................  $   .09   $   .32   $   .38
                                                          =======   =======   =======
Diluted earnings per share..............................  $   .09   $   .31   $   .37
                                                          =======   =======   =======


18.  BUSINESS SEGMENTS, GEOGRAPHIC DATA AND MAJOR CUSTOMERS

     We are a leading provider of sophisticated software solutions designed
specifically to address the demand and supply chain management, business
process, decision support, e-commerce, inventory optimization and collaborative
planning and forecasting requirements of the retail industry and its suppliers.
Our solutions enable our customers to collect, manage, organize and analyze
information throughout their retail enterprise, and to collaborate with
suppliers and customers over the Internet at multiple levels within their
organizations. We conduct business in three geographic regions that have
separate management teams and reporting structures: the Americas, Europe, and
Asia/Pacific. Similar products and services are offered in each geographic
region and local management is evaluated primarily based on total revenues and
operating income. Identifiable assets are also managed by geographical region.
The accounting policies of each region are the same as those described in Note 1
of the Notes to Consolidated Financial Statements. The geographic distribution
of our revenues and identifiable assets for the three-year period ended December
31, 2003 is as follows:



                                                         2003       2002       2001
                                                       --------   --------   --------
                                                                    
REVENUES:
  Americas...........................................  $134,974   $142,247   $143,737
  Europe.............................................    57,291     59,577     47,321
  Asia/Pacific.......................................    22,916     21,424     24,787
                                                       --------   --------   --------
                                                        215,181    223,248    215,845
  Sales and transfers among regions..................    (7,762)    (3,793)    (2,029)
                                                       --------   --------   --------
     Total revenues..................................  $207,419   $219,455   $213,816
                                                       ========   ========   ========
IDENTIFIABLE ASSETS:
  Americas...........................................  $267,834   $260,502   $230,345
  Europe.............................................    40,023     43,446     48,336
  Asia/Pacific.......................................    12,768     11,106      9,961
                                                       --------   --------   --------
     Total identifiable assets.......................  $320,625   $315,054   $288,642
                                                       ========   ========   ========


                                        89

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     No customer accounted for more than 10% of our revenues during the three
years ended December 31, 2003.

     We have organized our business segments around the distinct requirements of
retail enterprises, retail stores, and suppliers to the retail industry:

     - Retail Enterprise Systems include corporate level merchandise management
       systems ("MERCHANDISE MANAGEMENT SYSTEMS") that enable retailers to
       manage their inventory, product mix, pricing and promotional execution,
       and enhance the productivity and accuracy of warehouse processes. In
       addition, Retail Enterprise Systems include a comprehensive set of tools
       for planning inventory and in-store space decisions throughout the demand
       chain, analyzing business results and trends, automating demand
       forecasting and replenishment, tracking customer shopping patterns,
       optimizing revenues through trade allowance and promotional program
       management ("STRATEGIC MERCHANDISE MANAGEMENT SOLUTIONS").

     - In-Store Systems include point-of-sale, labor scheduling and back office
       applications that enable retailers to capture, analyze and transmit
       certain sales, store inventory and other operational information to
       corporate level merchandise management and payroll systems using
       hand-held, radio frequency devices, point-of-sale workstations or via the
       Internet. In-Store Systems now include a workforce management solution to
       optimize the scheduling of in-store labor which typically represents the
       next largest operational cost for a retail after inventory.

     - Collaborative Solutions provide applications that enable
       business-to-business collaborative activities such as collaborative
       planning, forecasting and replenishment ("CPFR"), collaborative category
       management including collaborative space and assortment planning, and
       collaborative revenue management through trade funds management programs.
       Our Collaborative Solutions offerings leverage existing solutions
       deployed to retailers within our Retail Enterprise Systems business
       segment.

                                        90

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

     A summary of the revenues, operating income (loss), and depreciation
attributable to each of these business segments for the three years ended
December 31, 2003 is as follows:



                                                         2003       2002       2001
                                                       --------   --------   --------
                                                                    
REVENUES:
  Retail Enterprise Systems..........................  $146,266   $151,113   $162,251
  In-Store Systems...................................    13,568     25,475     27,073
  Collaborative Solutions............................    47,585     42,867     24,492
                                                       --------   --------   --------
                                                       $207,419   $219,455   $213,816
                                                       ========   ========   ========
OPERATING INCOME (LOSS)
  Retail Enterprise Systems..........................  $ 18,191   $ 29,825   $ 34,929
  In-Store Systems...................................      (405)     5,337      5,484
  Collaborative Solutions............................    11,195     10,470      7,636
  Other (see below)..................................   (27,695)   (37,366)   (35,971)
                                                       --------   --------   --------
                                                       $  1,286   $  8,266   $ 12,078
                                                       ========   ========   ========
DEPRECIATION
  Retail Enterprise systems..........................  $  6,260   $  5,937   $  6,401
  In-Store systems...................................       843      1,270      1,385
  Collaborative Solutions............................     1,597      1,146        419
                                                       --------   --------   --------
                                                       $  8,700   $  8,353   $  8,205
                                                       ========   ========   ========
OTHER:
  General and administrative expenses................  $ 23,473   $ 26,978   $ 27,099
  Amortization of intangible assets..................     3,067      2,849      5,526
  Relocation costs to consolidate development and
     customer support activities.....................     1,794        452         --
  In-process research and development charge (see
     Note 2).........................................        --        800      2,361
  Restructuring, asset disposition and other merger
     related charges (see Note 9)....................        --      6,287        985
  Gain of sale of office facility....................      (639)        --         --
                                                       --------   --------   --------
                                                       $ 27,695   $ 37,366   $ 35,971
                                                       ========   ========   ========


     Operating income in the Retail Enterprise Systems, In-Store Systems and
Collaborative Solutions business segments includes direct expenses for software
licenses, maintenance services, service revenues, amortization of acquired
software technology, sales and marketing expenses, product development expenses,
as well as allocations for occupancy costs and depreciation expense. The "Other"
caption includes general and administrative expenses and other charges that are
not directly identified with a particular business segment and which management
does not consider in evaluating the operating income of the business segment.

                                        91

                   JDA SOFTWARE GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

19.  QUARTERLY DATA (UNAUDITED)

     The following table presents selected unaudited quarterly operating results
for the two-year period ended December 31, 2003. We believe that all necessary
adjustments have been included in the amounts shown below to present fairly the
related quarterly results.

CONSOLIDATED STATEMENT OF INCOME DATA:



                                                            2003
                                      ------------------------------------------------
                                       FIRST    SECOND     THIRD    FOURTH
                                      QUARTER   QUARTER   QUARTER   QUARTER    TOTAL
                                      -------   -------   -------   -------   --------
                                                               
Revenues............................  $41,255   $52,965   $57,951   $55,248   $207,419
Income (loss) from operations.......   (3,988)    1,607     3,531       136      1,286
Net income (loss)...................   (2,238)    1,291     3,374       223      2,650
Basic earnings (loss) per share.....  $  (.08)  $   .05   $   .12   $   .01   $    .09
Diluted earnings (loss) per share...  $  (.08)  $   .05   $   .11   $   .01   $    .09




                                                            2002
                                      ------------------------------------------------
                                       FIRST    SECOND     THIRD    FOURTH
                                      QUARTER   QUARTER   QUARTER   QUARTER    TOTAL
                                      -------   -------   -------   -------   --------
                                                               
Revenues............................  $59,150   $57,584   $49,412   $53,309   $219,455
Income (loss) from operations.......    6,462     3,728       833    (2,757)     8,266
Net income..........................    4,545     2,677       758       950      8,930
Basic earnings per share............  $   .17   $   .10   $   .03   $   .03   $    .32
Diluted earnings per share..........  $   .16   $   .09   $   .03   $   .03   $    .31


     Income from operations for 2003 includes $1.8 million in relocation costs
to consolidate development and support activities including $682,000, $578,000,
$458,000 and $76,000 recorded in the first, second, third and fourth quarters of
2003, respectively, and a $639,000 gain on the sale of an office facility in
second quarter 2003. Income from operations for 2002 includes restructuring and
asset disposition charges of $1.3 million and $5.0 million that were recorded
during the second and fourth quarters of 2002, respectively, an $800,000 charge
for IPR&D in connection with the acquisition of J-Commerce in second quarter
2002, and $452,000 in relocation costs to consolidate development and support
activities.

                                        92


                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                          JDA SOFTWARE GROUP, INC.

                                          By:    /s/ HAMISH N. J. BREWER
                                            ------------------------------------
                                                    Hamish N. J. Brewer
                                               President and Chief Executive
                                                           Officer
                                               (Principal Executive Officer)

Date: March 12, 2004

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below on March 12, 2004 by the following persons in the
capacities indicated.



              SIGNATURE                                        TITLE
              ---------                                        -----
                                   

        /s/ JAMES D. ARMSTRONG                         Chairman of the Board
- --------------------------------------
          James D. Armstrong


       /s/ HAMISH N. J. BREWER                 President and Chief Executive Officer
- --------------------------------------             (Principal Executive Officer)
         Hamish N. J. Brewer


       /s/ KRISTEN L. MAGNUSON              Executive Vice President and Chief Financial
- --------------------------------------      Officer (Principal Financial and Accounting
         Kristen L. Magnuson                                  Officer)


        /s/ J. MICHAEL GULLARD                                Director
- --------------------------------------
          J. Michael Gullard


        /s/ WILLIAM C. KEIPER                                 Director
- --------------------------------------
          William C. Keiper


        /s/ DOUGLAS G. MARLIN                                 Director
- --------------------------------------
          Douglas G. Marlin


           /s/ JOCK PATTON                                    Director
- --------------------------------------
             Jock Patton


                                        93


                                 EXHIBIT INDEX



EXHIBIT NO.                            DESCRIPTION OF DOCUMENT
- -----------                            -----------------------
               
 2.1**         --    Asset Purchase Agreement dated as of June 4, 1998, by and
                     among JDA Software Group, Inc., JDA Software, Inc. and
                     Comshare, Incorporated.
 2.2##         --    Asset Purchase Agreement dated as of February 24, 2000, by
                     and among JDA Software Group, Inc., Pricer AB, and Intactix
                     International, Inc.
 2.3###        --    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.
 3.1####       --    Third Restated Certificate of Incorporation of the Company
                     together with Certificate of Amendment dated July 23, 2002.
 3.2***        --    First Amended and Restated Bylaws.
 4.1*          --    Specimen Common Stock certificate.
10.1*(1)       --    Form of Indemnification Agreement.
10.2*(1)       --    1995 Stock Option Plan, as amended, and form of agreement
                     thereunder.
10.3(1)        --    1996 Stock Option Plan, as amended on March 28, 2003.
10.4*(1)       --    1996 Outside Directors Stock Option Plan and forms of
                     agreement thereunder.
10.5(1)        --    Executive Employment Agreement between James D. Armstrong
                     and JDA Software Group, Inc. dated July 23, 2002, together
                     with Amendment No. 1 effective August 1, 2003.
10.6(1)        --    Executive Employment Agreement between Hamish N. Brewer and
                     JDA Software Group, Inc. dated January 22, 2003, together
                     with Amendment No. 1 effective August 1, 2003.
10.7(1)####    --    Executive Employment Agreement between Kristen L. Magnuson
                     and JDA Software Group, Inc. dated July 23, 2002.
10.8(1)        --    1998 Nonstatutory Stock Option Plan, as amended on March 28,
                     2003.
10.9#(1)       --    1998 Employee Stock Purchase Plan.
10.10+         --    1999 Employee Stock Purchase Plan.
10.11++++      --    Lease Agreement between Opus West Corporation and JDA
                     Software Group, Inc. dated April 30, 1998, together with
                     First Amendment dated June 30, 1998, Second Amendment dated
                     November 23, 1998, revised and restated Third Amendment
                     dated October 20, 1999, Fourth Amendment dated May 30, 2001,
                     Fifth Amendment dated May 31, 2001, Sixth Amendment dated
                     August 2001, Seventh Amendment dated June 30 2003, and
                     Letter Agreement dated June 30, 2003.
10.12**        --    Software License Agreement dated as of June 4, 1998 by and
                     between Comshare, Incorporated and JDA Software, Inc.
10.13          --    Purchase Agreement between Opus Real Estate Arizona II,
                     L.L.C. and JDA Software Group, Inc. dated February 5, 2004.
10.14(2)       --    Value-Added Reseller License Agreement for Uniface Software
                     between Compuware Corporation and JDA Software Group, Inc.
                     dated April 1, 2000, together with Product Schedule No. One
                     dated June 23, 2000, Product Schedule No. Two dated
                     September 28, 2001, and Amendment to Product Schedule No.
                     Two dated December 23, 2003.
10.15(1)       --    JDA Software, Inc. 401(k) Profit Sharing Plan, adopted as
                     amended effective January 1, 2004.
10.17***(1)    --    Form of Amendment of Stock Option Agreement between JDA
                     Software Group, Inc and Kristen L. Magnuson, amending
                     certain stock options granted to Ms. Magnuson pursuant to
                     the JDA Software Group, Inc. 1996 Stock Option Plan on
                     September 11, 1997 and January 27, 1998.





EXHIBIT NO.                            DESCRIPTION OF DOCUMENT
- -----------                            -----------------------
               
10.18++(1)     --    Form of Rights Agreement between the Company and ChaseMellon
                     Shareholder Services, as Rights Agent (including as Exhibit
                     A the Form of Certificate of Designation, Preferences and
                     Rights of the Terms of the Series A Preferred Stock, as
                     Exhibit B the From of Right Certificate, and as Exhibit C
                     the Summary of Terms and Rights Agreement).
10.19+++(1)    --    Form of Incentive Stock Option Agreement between JDA
                     Software Group, Inc. and Kristen L. Magnuson to be used in
                     connection with stock option grants to Ms. Magnuson pursuant
                     to the JDA Software Group, Inc. 1996 Stock Option Plan.
10.20S(1)(3)   --    Form of Incentive Stock Option Agreement between JDA
                     Software Group, Inc. and certain Senior Executive Officers
                     to be used in connection with stock options granted pursuant
                     to the JDA Software Group, Inc. 1996 Stock Option Plan.
10.21S(1)(3)   --    Form of Nonstatutory Stock Option Agreement between JDA
                     Software Group, Inc. and certain Senior Executive Officers
                     to be used in connection with stock options granted pursuant
                     to the JDA Software Group, Inc. 1996 Stock Option Plan.
10.22S(1)(4)   --    Form of Amendment of Stock Option Agreement between JDA
                     Software Group, Inc and certain Senior Executive Officers,
                     amending certain stock options granted pursuant to the JDA
                     Software Group, Inc. 1995 Stock Option Plan.
10.23S(1)(5)   --    Form of Amendment of Stock Option Agreement between JDA
                     Software Group, Inc and certain Senior Executive Officers,
                     amending certain stock options granted pursuant to the JDA
                     Software Group, Inc. 1996 Stock Option Plan.
10.24S(1)(6)   --    Form of Incentive Stock Option Agreement between JDA
                     Software Group, Inc. and certain Senior Executive Officers
                     to be used in connection with stock options granted pursuant
                     to the JDA Software Group, Inc. 1996 Stock Option Plan.
10.25SS        --    Secured Loan Agreement between JDA Software Group, Inc. and
                     Silvon Software, Inc. dated May 8, 2001, together with
                     Secured Promissory Note and Security Agreement.
14.1           --    Code of Business Conduct and Ethics
21.1           --    Subsidiaries of Registrant
23.1           --    Consent of Independent Auditors
31.1           --    Rule 13a-14(a) Certification of Chief Executive Officer
31.2           --    Rule 13a-14(a) Certification of Chief Financial Officer
32.1           --    Certification of Chief Executive Officer and Chief Financial
                     Officer pursuant to 18 U.S.C. Section 1350, as adopted
                     pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.


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

     * Incorporated by reference to the Company's Registration Statement on Form
       S-1 (File No. 333-748), declared effective on March 14, 1996.

     ** Incorporated by reference to the Company's Current Report on Form 8-K
        dated June 4, 1998, as filed on June 19, 1998.

   *** Incorporated by reference to the Company's Quarterly Report on Form 10-Q
       for the quarterly period ended June 30, 1998, as filed on August 14,
       1998.

     + Incorporated by reference to the Company's Quarterly Report on Form 10-Q
       for the quarterly period ended June 30, 1999, as filed on August 19,
       1999.

     ++ Incorporated by reference to the Company's Current Report on Form 8-K
        dated October 2, 1998, as filed on October 28, 1998.

   +++ Incorporated by reference to the Company's Quarterly Report on Form 10-Q
       for the quarterly period ended September 30, 1998, as filed on November
       13, 1998.

  ++++ Incorporated by reference to the Company's Quarterly Report on Form 10-Q
       for the quarterly period ended June 30, 2003, as filed on August 13,
       2003.


     # Incorporated by reference to the Company's Annual Report on Form 10-K for
       the year ended December 31, 1998, as filed on March 31, 1998.

   ## Incorporated by reference to the Company's Current Report on Form 8-K
      dated February 24, 2000, as filed on March 1, 2000.

 ### Incorporated by reference to the Company's Current Report on Form 8-K dated
     September 7, 2001, as filed on September 21, 2001.

#### Incorporated by reference to the Company's Quarterly Report on Form 10-Q
     for the quarterly period ended September 30, 2002, as filed on November 12,
     2002.

     S Incorporated by reference to the Company's Annual Report on Form 10-K for
       the year ended December 31, 1999, as filed on March 16, 2000.

   SS Incorporated by reference to the Company's Quarterly Report on Form 10-Q
      for the quarterly period ended June 30, 2001, as filed on August 14, 2001.

   (1) Management contracts or compensatory plans or arrangements covering
       executive officers or directors of the Company.

   (2) Confidential treatment has been granted as to part of this exhibit.

   (3) Applies to James D. Armstrong.

   (4) Applies to Hamish N. Brewer and Gregory L. Morrison.

   (5) Applies to Hamish N. Brewer, Peter J. Charness, Scott D. Hines, Gregory
       L. Morrison and David J. Tidmarsh.

   (6) Applies to Senior Executive Officers with the exception of James D.
       Armstrong and Kristen L. Magnuson.

EX-10.3

                                                                    EXHIBIT 10.3

                            JDA SOFTWARE GROUP, INC.

                             1996 STOCK OPTION PLAN

                         (AS AMENDED ON MARCH 28, 2003)

         1.       ESTABLISHMENT, PURPOSE AND TERM OF PLAN.

                  1.1      ESTABLISHMENT. The JDA Software Group, Inc. 1996
Stock Option Plan is hereby established effective as of January 12, 1996 (the
"EFFECTIVE DATE").

                  1.2      PURPOSE. The purpose of the Plan is to advance the
interests of the Participating Company Group and its stockholders by providing
an incentive to attract, retain and reward persons performing services for the
Participating Company Group and by motivating such persons to contribute to the
growth and profitability of the Participating Company Group.

                  1.3      TERM OF PLAN. The Plan shall continue in effect until
the earlier of its termination by the Board or the date on which all of the
shares of Stock available for issuance under the Plan have been issued and all
restrictions on such shares under the terms of the Plan and the agreements
evidencing Options granted under the Plan have lapsed. However, all Incentive
Stock Options shall be granted, if at all, within ten (10) years from the
Effective Date. Notwithstanding the foregoing, if the maximum number of shares
of Stock issuable pursuant to the Plan as provided in Section 4.1 has been
increased at any time, all Incentive Stock Options shall be granted, if at all,
no later than the last day preceding the tenth (10th) anniversary of the earlier
of (a) the date on which the latest such increase in the maximum number of
shares of Stock issuable under the Plan was approved by the stockholders of the
Company or (b) the date such amendment was adopted by the Board.

         2.       DEFINITIONS AND CONSTRUCTION.

                  2.1      DEFINITIONS. Whenever used herein, the following
terms shall have their respective meanings set forth below:

                           (a)      "BOARD" means the Board of Directors of the
Company. If one or more Committees have been appointed by the Board to
administer the Plan, "Board" also means such Committee(s).

                           (b)      "CODE" means the Internal Revenue Code of
1986, as amended, and any applicable regulations promulgated thereunder.

                           (c)      "COMMITTEE" means the Compensation Committee
or other committee of the Board duly appointed to administer the Plan and having
such powers as shall be specified by the Board. Unless the powers of the
Committee have been specifically limited, the Committee shall have all of the
powers of the Board granted herein, including, without limitation, the power to
amend or terminate the Plan at any time, subject to the terms of the Plan and
any applicable limitations imposed by law.

                           (d)      "COMPANY" means JDA Software Group, Inc., a
Delaware corporation, or any successor corporation thereto.

                           (e)      "CONSULTANT" means any person, including an
advisor, engaged by a Participating Company to render services other than as an
Employee or a Director.



                           (f)      "DIRECTOR" means a member of the Board or of
the board of directors of any other Participating Company.

                           (g)      "EMPLOYEE" means any person treated as an
employee (including an officer or a Director who is also treated as an employee)
in the records of a Participating Company; provided, however, that neither
service as a Director nor payment of a director's fee shall be sufficient to
constitute employment for purposes of the Plan.

                           (h)      "EXCHANGE ACT" means the Securities Exchange
Act of 1934, as amended.

                           (i)      "FAIR MARKET VALUE" means, as of any date,
the value of a share of stock or other property as determined by the Board, in
its sole discretion, or by the Company, in its sole discretion, if such
determination is expressly allocated to the Company herein.

                           (j)      "INCENTIVE STOCK OPTION" means an Option
intended to be (as set forth in the Option Agreement) and which qualifies as an
incentive stock option within the meaning of Section 422(b) of the Code.

                           (k)      "INSIDER" means an officer or a Director of
the Company or any other person whose transactions in Stock are subject to
Section 16 of the Exchange Act.

                           (l)      "NONSTATUTORY STOCK OPTION" means an Option
not intended to be (as set forth in the Option Agreement) or which does not
qualify as an Incentive Stock Option.

                           (m)      "OPTION" means a right to purchase Stock
(subject to adjustment as provided in Section 4.2) pursuant to the terms and
conditions of the Plan. An Option may be either an Incentive Stock Option or a
Nonstatutory Stock Option.

                           (n)      "OPTION AGREEMENT" means a written agreement
between the Company and an Optionee setting forth the terms, conditions and
restrictions of the Option granted to the Optionee and any shares acquired upon
the exercise thereof.

                           (o)      "OPTIONEE" means a person who has been
granted one or more Options.

                           (p)      "PARENT CORPORATION" means any present or
future "parent corporation" of the Company, as defined in Section 424(e) of the
Code.

                           (q)      "PARTICIPATING COMPANY" means the Company or
any Parent Corporation or Subsidiary Corporation.

                           (r)      "PARTICIPATING COMPANY GROUP" means, at any
point in time, all corporations collectively which are then Participating
Companies.

                           (s)      "RULE 16b-3" means Rule 16b-3 under the
Exchange Act, as amended from time to time, or any successor rule or regulation.

                           (t)      "SECTION 162(m)" means Section 162(m) of the
Code.

                           (u)      "STOCK" means the common stock, par value
$0.01, of the Company, as adjusted from time to time in accordance with Section
4.2.

                                       2


                           (v)      "SUBSIDIARY CORPORATION" means any present
or future "subsidiary corporation" of the Company, as defined in Section 424(f)
of the Code.

                           (w)      "TEN PERCENT OWNER OPTIONEE" means an
Optionee who, at the time an Option is granted to the Optionee, owns stock
possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of a Participating Company within the meaning of Section
422(b)(6) of the Code.

                  2.2      CONSTRUCTION. Captions and titles contained herein
are for convenience only and shall not affect the meaning or interpretation of
any provision of the Plan. Except when otherwise indicated by the context, the
singular shall include the plural, the plural shall include the singular, and
the term "or" shall include the conjunctive as well as the disjunctive.

         3.       ADMINISTRATION.

                  3.1      ADMINISTRATION BY THE BOARD. The Plan shall be
administered by the Board, including any duly appointed Committee of the Board.
All questions of interpretation of the Plan or of any Option shall be determined
by the Board, and such determinations shall be final and binding upon all
persons having an interest in the Plan or such Option. Any officer of a
Participating Company shall have the authority to act on behalf of the Company
with respect to any matter, right, obligation, determination or election which
is the responsibility of or which is allocated to the Company herein, provided
the officer has apparent authority with respect to such matter, right,
obligation, determination or election.

                  3.2      POWERS OF THE BOARD. In addition to any other powers
set forth in the Plan and subject to the provisions of the Plan, the Board shall
have the full and final power and authority, in its sole discretion:

                           (a)      to determine the persons to whom, and the
time or times at which, Options shall be granted and the number of shares of
Stock to be subject to each Option;

                           (b)      to designate Options as Incentive Stock
Options or Nonstatutory Stock Options;

                           (c)      to determine the Fair Market Value of shares
of Stock or other property;

                           (d)      to determine the terms, conditions and
restrictions applicable to each Option (which need not be identical) and any
shares acquired upon the exercise thereof, including, without limitation, (i)
the exercise price of the Option, subject to the limitations set forth in
Section 6.1 hereof, (ii) the method of payment for shares purchased upon the
exercise of the Option, (iii) the method for satisfaction of any tax withholding
obligation arising in connection with the Option or such shares, including by
the withholding or delivery of shares of stock, (iv) the timing, terms and
conditions of the exercisability of the Option or the vesting of any shares
acquired upon the exercise thereof, (v) the time of the expiration of the
Option, (vi) the effect of the Optionee's termination of employment or service
with the Participating Company Group on any of the foregoing, and (vii) all
other terms, conditions and restrictions applicable to the Option or such shares
not inconsistent with the terms of the Plan;

                           (e)      to approve one or more forms of Option
Agreement;

                           (f)      to amend, modify, extend, or renew, or grant
a new Option in substitution for, any Option or to waive any restrictions or
conditions applicable to any Option or any shares acquired upon the exercise
thereof; provided, however, that, in no event shall the Board have the power or
authority to reprice or otherwise effect a reduction in the exercise price of
any Options granted under the Plan;

                           (g)      to accelerate, continue, extend or defer the
exercisability of any Option or the vesting of any shares acquired upon the
exercise thereof, including with respect to the period following an Optionee's
termination of employment or service with the Participating Company Group;

                                       3


                           (h)      to delegate to any proper officer of the
Company the authority to grant one or more Options, without further approval of
the Board, to any person eligible pursuant to Section 5, other than a person
who, at the time of such grant, is an Insider, provided, however, that (i) the
exercise price per share of each such Option shall be equal to the Fair Market
Value per share of the Stock on the effective date of grant (or, if the Stock
has not traded on such date, on the last day preceding the effective date of
grant on which the Stock was traded), and (ii) each such Option shall be subject
to the terms and conditions of the appropriate standard form of Option Agreement
approved by the Board and shall conform to the provisions of the Plan and such
other guidelines as shall be established from time to time by the Board,

                           (i)      to prescribe, amend or rescind rules,
guidelines and policies relating to the Plan, or to adopt supplements to, or
alternative versions of, the Plan, including, without limitation, as the Board
deems necessary or desirable to comply with the laws of, or to accommodate the
tax policy or custom of, foreign jurisdictions whose citizens may be granted
Options; and to correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Option Agreement and to make all other
determinations and take such other actions with respect to the Plan or any
Option as the Board may deem advisable to the extent consistent with the Plan
and applicable law.

                  3.3      ADMINISTRATION WITH RESPECT TO INSIDERS. With respect
to participation by Insiders in the Plan, at any time that any class of equity
security of the Company is registered pursuant to Section 12 of the Exchange
Act, the Plan shall be administered in compliance with the requirements, if any,
of Rule 16b-3.

                  3.4      COMMITTEE COMPLYING WITH SECTION 162(m). If a
Participating Company is a "publicly held corporation" within the meaning of
Section 162(m), the Board may establish a Committee of "outside directors"
within the meaning of Section 162(m) to approve the grant of any Option which
might reasonably be anticipated to result in the payment of employee
remuneration that would otherwise exceed the limit on employee remuneration
deductible for income tax purposes pursuant to Section 162(m).

         4.       SHARES SUBJECT TO PLAN.

                  4.1      MAXIMUM NUMBER OF SHARES ISSUABLE. Subject to
adjustment as provided in Section 4.2, the maximum aggregate number of shares of
Stock that may be issued under the Plan shall be eight million two hundred
thousand (8,200,000) and shall consist of authorized but unissued or reacquired
shares of Stock or any combination thereof. However, except as adjusted pursuant
to Section 4.2, the maximum aggregate number of shares of Stock to be subject to
new Options that may be granted under the Plan in the twelve (12) month period
commencing on May 25, 2000 (and subsequent 12-month periods commencing on each
anniversary thereof) shall be one million two hundred thousand (1,200,000) (the
"ANNUAL GRANT LIMIT"). If an outstanding Option for any reason expires or is
terminated or canceled or shares of Stock acquired, subject to repurchase, upon
the exercise of an Option are repurchased by the Company, the shares of Stock
allocable to the unexercised portion of such Option, or such repurchased shares
of Stock, shall again be available for issuance under the Plan.

                  4.2      ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the
event of any stock dividend, stock split, reverse stock split, recapitalization,
combination, reclassification or similar change in the capital structure of the
Company, appropriate adjustments shall be made in the number and class of shares
subject to the Plan and to any outstanding Options, in the Annual Grant Limit,
in the Section 162(m) Grant Limit set forth in Section 5.4, and in the exercise
price per share of any outstanding Options. If a majority of the shares which
are of the same class as the shares that are subject to outstanding Options are
exchanged for, converted into, or otherwise become (whether or not pursuant to
an Ownership Change Event, as defined in Section 8.1) shares of another
corporation (the "NEW SHARES"), the Board may unilaterally amend the outstanding
Options to provide that such Options are exercisable for New Shares. In the
event of any such amendment, the number of shares subject to, and the exercise
price per share of, the outstanding Options shall be adjusted in a fair and
equitable manner as determined by the Board, in its sole discretion.
Notwithstanding the foregoing, any fractional share resulting from an adjustment
pursuant to this Section 4.2 shall be rounded up or down to the nearest whole
number, as determined by the Board, and in no event may the

                                       4


exercise price of any Option be decreased to an amount less than the par value,
if any, of the stock subject to the Option. The adjustments determined by the
Board pursuant to this Section 4.2 shall be final, binding and conclusive.

         5.       ELIGIBILITY AND OPTION LIMITATIONS.

                  5.1      PERSONS ELIGIBLE FOR OPTIONS. Options may be granted
only to Employees, Consultants, and Directors. For purposes of the foregoing
sentence, "Employees" shall include prospective Employees to whom Options are
granted in connection with written offers of employment with the Participating
Company Group, and "Consultants" shall include prospective Consultants to whom
Options are granted in connection with written offers of engagement with the
Participating Company Group. Notwithstanding the foregoing, no Director of the
Company who is not also an Employee may be granted an Option at any time that
any class of equity security of the Company is registered pursuant to Section 12
of the Exchange Act. Eligible persons may be granted more than one (1) Option.

                  5.2      OPTION GRANT RESTRICTIONS. Any person who is not an
Employee on the effective date of the grant of an Option to such person may be
granted only a Nonstatutory Stock Option. An Incentive Stock Option granted to a
prospective Employee upon the condition that such person become an Employee
shall be deemed granted effective on the date such person commences service with
a Participating Company, with an exercise price determined as of such date in
accordance with Section 6.1.

                  5.3      FAIR MARKET VALUE LIMITATION. To the extent that the
aggregate Fair Market Value of stock with respect to which options designated as
Incentive Stock Options are exercisable by an Optionee for the first time during
any calendar year (under all stock option plans of the Participating Company
Group, including the Plan) exceeds One Hundred Thousand Dollars ($100,000), the
portion of such options which exceeds such amount shall be treated as
Nonstatutory Stock Options. For purposes of this Section 5.3, options designated
as Incentive Stock Options shall be taken into account in the order in which
they were granted, and the Fair Market Value of stock shall be determined as of
the time the option with respect to such stock is granted. If the Code is
amended to provide for a different limitation from that set forth in this
Section 5.3, such different limitation shall be deemed incorporated herein
effective as of the date and with respect to such Options as required or
permitted by such amendment to the Code. If an Option is treated as an Incentive
Stock Option in part and as a Nonstatutory Stock Option in part by reason of the
limitation set forth in this Section 5.3, the Optionee may designate which
portion of such Option the Optionee is exercising and may request that separate
certificates representing each such portion be issued upon the exercise of the
Option. In the absence of such designation, the Optionee shall be deemed to have
exercised the Incentive Stock Option portion of the Option first.

                  5.4      SECTION L62(m) GRANT LIMIT. Subject to adjustment as
provided in Section 4.2, at any such time as a Participating Company is a
"publicly held corporations" within the meaning of Section 162(m), no Employee
shall be granted one or more Options within any fiscal year of the Company which
in the aggregate are for the purchase of more than one million one hundred
twenty-five thousand (1,125,000) shares of Stock (the "SECTION 162(M) GRANT
LIMIT"). An Option which is canceled in the same fiscal year of the Company in
which it was granted shall continue to be counted against the Section 162(m)
Grant Limit for such period.

         6.       TERMS AND CONDITIONS OF OBLIGATIONS. Options shall be
evidenced by Option Agreements specifying the number of shares of Stock covered
thereby, in such form as the Board shall from time to time establish. Option
Agreements may incorporate all or any of the terms of the Plan by reference and
shall comply with and be subject to the following terms and conditions:

                  6.1      EXERCISE PRICE. The exercise price for each Option
shall be established in the sole discretion of the Board; provided, however,
that (a) the exercise price per share for an Option shall be not less than the
Fair Market Value of a share of Stock on the effective date of grant of the
Option, and (b) no Incentive Stock Option granted to a Ten Percent Owner
Optionee shall have an exercise price per share less than one hundred ten
percent (110%) of the Fair Market Value of a share of Stock on the effective
date of grant of the Option. Notwithstanding the foregoing, an Option (whether
an Incentive Stock Option or a Nonstatutory Stock Option) may be granted with an
exercise price lower than the minimum exercise price set forth above if such
Option is granted

                                       5


pursuant to an assumption or substitution for another option in a manner
qualifying under the provisions of Section 424(a) of the Code.

                  6.2      EXERCISE PERIOD. Options shall be exercisable at such
time or times, or upon such event or events, and subject to such terms,
conditions, performance criteria, and restrictions as shall be determined by the
Board and set forth in the Option Agreement evidencing such Option; provided,
however, that (a) no Incentive Stock Option shall be exercisable after the
expiration of ten (10) years after the effective date of grant of such Option,
(b) no Incentive Stock Option granted to a Ten Percent Owner Optionee shall be
exercisable after the expiration of five (5) years after the effective date of
grant of such Option and (c) no Option granted to a prospective Employee or
prospective Consultant may become exercisable prior to the date on which such
person commences service with a Participating Company.

                  6.3      PAYMENT OF EXERCISE PRICE.

                           (a)      FORMS OF CONSIDERATION AUTHORIZED. Except as
otherwise provided below, payment of the exercise price for the number of shares
of Stock being purchased pursuant to any Option shall be made (i) in cash, by
check, or cash equivalent, (ii) by tender to the Company of shares of Stock
owned by the Optionee having a Fair Market Value (as determined by the Company
without regard to any restrictions on transferability applicable to such stock
by reason of federal or state securities laws or agreements with an underwriter
for the Company) not less than the exercise price, (iii) by the assignment of
the proceeds of a sale or loan with respect to some or all of the shares being
acquired upon the exercise of the Option (including, without limitation, through
an exercise complying with the provisions of Regulation T as promulgated from
time to time by the Board of Governors of the Federal Reserve System) (a
"CASHLESS EXERCISE"), (iv) by the Optionee's promissory note in a form approved
by the Company, (v) by such other consideration as may be approved by the Board
from time to time to the extent permitted by applicable law, or (vi) by any
combination thereof. The Board may at any time or from time to time, by adoption
of or by amendment to the standard forms of Option Agreement described in
Section 7, or by other means, grant Options which do not permit all of the
foregoing forms of consideration to be used in payment of the exercise price or
which otherwise restrict one or more forms of consideration,

                           (b)      TENDER OF STOCK. Notwithstanding the
foregoing, an Option may not be exercised by tender to the Company of shares of
Stock to the extent such tender of Stock would constitute a violation of the
provisions of any law, regulation or agreement restricting the redemption of the
Company's stock. Unless otherwise provided by the Board, an Option may not be
exercised by tender to the Company of shares of Stock unless such shares either
have been owned by the Optionee for more than six (6) months or were not
acquired, directly or indirectly, from the Company.

                           (c)      CASHLESS EXERCISE. The Company reserves, at
any and all times, the right, in the Company's sole and absolute discretion, to
establish, decline to approve or terminate any program or procedures for the
exercise of Options by means of a Cashless Exercise.

                           (d)      PAYMENT BY PROMISSORY NOTE. No promissory
note shall be permitted if the exercise of an Option using a promissory note
would be a violation of any law. Any permitted promissory note shall be on such
terms as the Board shall determine at the time the Option is granted. The Board
shall have the authority to permit or require the Optionee to secure any
promissory note used to exercise an Option with the shares of Stock acquired
upon the exercise of the Option or with other collateral acceptable to the
Company. Unless otherwise provided by the Board, if the Company at any time is
subject to the regulations promulgated by the Board of Governors of the Federal
Reserve System or any other governmental entity affecting the extension of
credit in connection with the Company's securities, any promissory note shall
comply with such applicable regulations, and the Optionee shall pay the unpaid
principal and accrued interest, if any, to the extent necessary to comply with
such applicable regulations.

                  6.4      TAX WITHHOLDING. The Company shall have the right,
but not the obligation, to deduct from the shares of Stock issuable upon the
exercise of an Option, or to accept from the Optionee the tender of, a

                                       6


number of whole shares of Stock having a Fair Market Value, as determined by the
Company, equal to all or any part of the federal, state, local and foreign
taxes, if any, required by law to be withheld by the Participating Company Group
with respect to such Option or the shares acquired upon the exercise thereof.
Alternatively or in addition, in its sole discretion, the Company shall have the
right to require the Optionee, through payroll withholding, cash payment or
otherwise, including by means of a Cashless Exercise, to make adequate provision
for any such tax withholding obligations of the Participating Company Group
arising in connection with the Option or the shares acquired upon the exercise
thereof. The Company shall have no obligation to deliver shares of Stock or to
release shares of Stock from an escrow established pursuant to the Option
Agreement until the Participating Company Group's tax withholding obligations
have been satisfied by the Optionee.

                  6.5      REPURCHASE RIGHTS. Shares issued under the Plan may
be subject to a right of first refusal, one or more repurchase options, or other
conditions and restrictions as determined by the Board, in its sole discretion,
at the time the Option is granted. The Company shall have the right to assign at
any time any repurchase right it may have, whether or not such right is then
exercisable, to one or more persons as may be selected by the Company. Upon
request by the Company, each Optionee shall execute any agreement evidencing
such transfer restrictions prior to the receipt of shares of Stock hereunder and
shall promptly present to the Company any and all certificates representing
shares of Stock acquired hereunder for the placement on such certificates of
appropriate legends evidencing any such transfer restrictions.

         7.       STANDARD FORMS OF OPTION AGREEMENT.

                  7.1      INCENTIVE STOCK OPTIONS. Unless otherwise provided by
the Board at the time the Option is granted, an Option designated as an
"Incentive Stock Option" shall comply with and be subject to the terms and
conditions set forth in the form of Incentive Stock Option Agreement adopted by
the Board concurrently with its adoption of the Plan and as amended from time to
time.

                  7.2      NONSTATUTORY STOCK OPTIONS. Unless otherwise provided
by the Board at the time the Option is granted, an Option designated as a
"Nonstatutory Stock Option" shall comply with and be subject to the terms and
conditions set forth in the form of Nonstatutory Stock Option Agreement adopted
by the Board concurrently with its adoption of the Plan and as amended from time
to time.

                  7.3      STANDARD TERM OF OPTIONS. Except as otherwise
provided in Section 6.2 or by the Board in the grant of an Option, any Incentive
Stock Option granted hereunder shall have a term of ten (10) years from the
effective date of grant of the Option.

                  7.4      AUTHORITY TO VARY TERMS. The Board shall have the
authority from time to time to vary the terms of any of the standard forms of
Option Agreement described in this Section 7 either in connection with the grant
or amendment of an individual Option or in connection with the authorization of
a new standard form or forms; provided, however, that the terms and conditions
of any such new, revised or amended standard form or forms of Option Agreement
are not inconsistent with the terms of the Plan. Such authority shall include,
but not by way of limitations the authority to grant Options which are
immediately exercisable subject to the Company's right to repurchase any
unvested shares of Stock acquired by an Optionee upon the exercise of an Option
in the event such Optionee's employment or service with the Participating
Company Group is terminated for any reason, with or without cause.

         8.       TRANSFER OF CONTROL.

                  8.1      DEFINITIONS.

                           (a)      An "OWNERSHIP CHANGE EVENT" shall be deemed
to have occurred if any of the following occurs with respect to the Company:

                                       7


                                    (i)      the direct or indirect sale or
exchange in a single or series of related transactions by the stockholders of
the Company of more than fifty percent (50%) of the voting stock of the Company;

                                    (ii)     a merger or consolidation in which
the Company is a party;

                                    (iii)    the sale, exchange, or transfer of
all or substantially all of the assets of the Company; or

                                    (iv)     a liquidation or dissolution of the
Company.

                           (b)      A "TRANSFER OF CONTROL" shall mean an
Ownership Change Event or a series of related Ownership Change Events
(collectively, the "TRANSACTION") wherein the stockholders of the Company
immediately before the Transaction do not retain immediately after the
Transaction, in substantially the same proportions as their ownership of shares
of the Company's voting stock immediately before the Transaction, direct or
indirect beneficial ownership of more than fifty percent (50%) of the total
combined voting power of the outstanding voting stock of the Company or the
corporation or corporations to which the assets of the Company were transferred
(the "TRANSFEREE CORPORATION(S)"), as the case may be. For purposes of the
preceding sentence, indirect beneficial ownership shall include, without
limitation, an interest resulting from ownership of the voting stock of one or
more corporations which, as a result of the Transaction, own the Company or the
Transferee Corporation(s), as the case may be, either directly or through one or
more subsidiary corporations. The Board shall have the right to determine
whether multiple sales or exchanges of the voting stock of the Company or
multiple Ownership Change Events are related, and its determination shall be
final, binding and conclusive.

                  8.2      EFFECT OF TRANSFER OF CONTROL ON OPTIONS. In the
event of a Transfer of Control, the surviving, continuing, successor, or
purchasing corporation or parent corporation thereof, as the case may be (the
"ACQUIRING CORPORATION"), may either assume the Company's rights and obligations
under outstanding Options or substitute for outstanding Options substantially
equivalent options for the Acquiring Corporation's stock. In the event the
Acquiring Corporation elects not to assume or substitute for outstanding Options
in connection with a Transfer of Control, any unexercisable or unvested portion
of the outstanding Options shall be immediately exercisable and vested in full
as of the date ten (10) days prior to the date of the Transfer of Control. The
exercise or vesting of any Option that was permissible solely by reason of this
Section 8.2 shall be conditioned upon the consummation of the Transfer of
Control. Any Options which are neither assumed or substituted for by the
Acquiring Corporation in connection with the Transfer of Control nor exercised
as of the date of the Transfer of Control shall terminate and cease to be
outstanding effective as of the date of the Transfer of Control. Notwithstanding
the foregoing, shares acquired upon exercise of an Option prior to the Transfer
of Control and any consideration received pursuant to the Transfer of Control
with respect to such shares shall continue to be subject to all applicable
provisions of the Option Agreement evidencing such Option except as otherwise
provided in such Option Agreement. Furthermore, notwithstanding the foregoing,
if the corporation the stock of which is subject to the outstanding Options
immediately prior to an Ownership Change Event described in Section 8.1(a)(i)
constituting a Transfer of Control is the surviving or continuing corporation
and immediately after such Ownership Change Event less than fifty percent (50%)
of the total combined voting power of its voting stock is held by another
corporation or by other corporations that are members of an affiliated group
within the meaning of Section 1504(a) of the Code without regard to the
provisions of Section 1504(b) of the Code, the outstanding Options shall not
terminate unless the Board otherwise provides in its sole discretion.

         9.       PROVISION OF INFORMATION. Each Optionee shall be given access
to information concerning the Company equivalent to that information generally
made available to the Company's common stockholders.

         10.      NONTRANSFERABILITY OF OPTIONS. During the lifetime of the
Optionee, an Option shall be exercisable only by the Optionee or the Optionee's
guardian or legal representative. No Option shall be assignable or transferable
by the Optionee, except by will or by the laws of descent and distribution.

                                       8


         11.      INDEMNIFICATION. In addition to such other rights of
indemnification as they may have as members of the Board or officers or
employees of the Participating Company Group, members of the Board and any
officers or employees of the Participating Company Group to whom authority to
act for the Board is delegated shall be indemnified by the Company against all
reasonable expenses, including attorneys' fees, actually and necessarily
incurred in connection with the defense of any action, suit or proceeding, or in
connection with any appeal therein, to which they or any of them may be a party
by reason of any action taken or failure to act under or in connection with the
Plan, or any right granted hereunder, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in any such action, suit or proceeding, except in relation to matters as to
which it shall be adjudged in such action, suit or proceeding that such person
is liable for gross negligence, bad faith or intentional misconduct in duties;
provided, however, that within sixty (60) days after the institution of such
action, suit or proceeding, such person shall offer to the Company, in writing,
the opportunity at its own expense to handle and defend the same.

         12.      TERMINATION OR AMENDMENT OF PLAN. The Board may terminate or
amend the Plan at any time. However, subject to changes in the law or other
legal requirements that would permit otherwise, without the approval of the
Company's stockholders, there shall be (a) no increase in the maximum aggregate
number of shares of Stock that may be issued under the Plan (except by operation
of the provisions of Section 4.2), (b) no change in the class of persons
eligible to receive Incentive Stock Options, and (c) no expansion in the class
of persons eligible to receive Nonstatutory Stock Options. In any event, no
termination or amendment of the Plan may adversely affect any then outstanding
Option or any unexercised portion thereof, without the consent of the Optionee,
unless such termination or amendment is required to enable an Option designated
as an Incentive Stock Option to qualify as an Incentive Stock Option or is
necessary to comply with any applicable law or government regulation.

         IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies
that the foregoing is the JDA Software Group, Inc. 1996 Stock Option Plan as
duly adopted by the Board on January 12, 1996 and amended by the Board through
March 28, 2003.

                                         /s/_________________________________
                                            Secretary

                                       9


                                  PLAN HISTORY
                        
January 12, 1996           Board adopts Plan, with an initial reserve of 1,250,000 shares.

January 12, 1996           Stockholders approve Plan, with an initial reserve of 1,250,000 shares.

July 23, 1997              Board amends Plan to authorize the Board to delegate to any proper officer of
                           the Company the authority, without further approval of the Board, to grant one
                           or more options under the Plan to any person eligible thereunder, with certain
                           limitations, other than a person whose transactions in the Company's common
                           stock are subject to Section 16 of the Securities Exchange Act of 1934, as
                           amended.

January 27, 1998           Board amends Plan to increase share reserve to 3,000,000 shares and to establish
                           the Section 162(m) Grant Limit.

June 11, 1998              Stockholders approve increase in the Plan's share reserve to 3,000,000 shares
                           and the establishment of the Section 162(m) Grant Limit.

July 20, 1998              Company effects a 3:2 stock split, resulting in an adjusted share reserve of
                           4,500,000 shares.

March 2000                 Board amends Plan to increase the share reserve to 8,500,000 shares.

May 25, 2000               Amended Stock Option Plan does not receive necessary votes for approval at the
                           2000 Annual Meeting and adjournments thereof.

August 28, 2000            Board amends Plan to (i) increase share reserve by 2,500,000 shares to 7,000,000
                           shares (ii) establish the Annual Grant Limit, (iii) provide that Options may not
                           be repriced and (iv) provide that Options may not be granted at an exercise
                           price below the Fair Market Value.

November 9, 2000           Stockholders approved at a Special Meeting of Stockholders amendment of Plan to
                           increase the number of shares reserved for issuance thereunder from 4,500,000 to
                           7,000,000 and to establish the Option Grant Restrictions as set forth in the
                           Plan.

March 28, 2003             Board amends Plan to increase the share reserve by 1,200,000 shares to 8,200,000
                           shares.

EX-10.5

                                                                    EXHIBIT 10.5

                         EXECUTIVE EMPLOYMENT AGREEMENT

         THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "AGREEMENT") is
entered into and shall be effective as of July 23, 2002 (the "EFFECTIVE DATE"),
by and among JDA SOFTWARE GROUP, INC., a Delaware corporation ("COMPANY") and
JAMES D. ARMSTRONG ("EXECUTIVE").

                                    RECITALS

         A.       Company, Executive and JDA Software, Inc., an Arizona
corporation and wholly-owned subsidiary of Company, are parties to an Employment
Agreement entered into effective as of January 1, 1998 (the "EMPLOYMENT
AGREEMENT"), pursuant to which Executive has been employed as Co-Chairman of the
Board of Directors of Company.

         B.       Company's former Co-Chief Executive Officer resigned effective
as of January 4, 1999, and Executive has served as Company's Chief Executive
Officer since such resignation.

         C.       Company's former Co-Chairman of the Board of Directors
resigned effective June 23, 2000, and Executive has served as Company's sole
Chairman of the Board of Directors since such resignation.

         D.       Company and Executive desire to amend and restate the
Employment Agreement in its entirety in accordance with Section 9(i) thereof as
hereafter set forth.

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

                                    AGREEMENT

         The Employment Agreement is hereby amended and restated in its entirety
as of the Effective Date.

         1.       Employment. Company hereby employs Executive, and Executive
hereby accepts such employment, upon the terms and conditions set forth herein.

         2.       Duties.

                  2.1      Position. Executive is employed as Chairman of the
Board of Directors ("CHAIRMAN") and Chief Executive Officer ("CEO") of Company.
Executive shall perform faithfully and diligently all duties assigned to
Executive. The Board of Directors of Company ("BOARD") reserves the right to
modify Executive's position and duties at any time in its sole and absolute
discretion, provided that the duties assigned are consistent with the position
of Chairman and CEO.

                  2.2      Standard of Conduct/Full-time. During the term of
this Agreement, Executive will act loyally and in good faith to discharge the
duties of Chairman and CEO, and will abide by all policies and decisions made by
Company, as well as all applicable federal, state and local laws, regulations or
ordinances. Executive will act solely on behalf of Company at all times.
Executive shall devote Executive's full business time and efforts to the
performance of Executive's assigned duties for Company, unless Executive
notifies the Board in advance of



Executive's intent to engage in other paid work and receives the Board's express
written consent to do so.

                  2.3      Work Location. Executive's principal place of work
shall be located in Scottsdale, Arizona or such other location as the parties
may agree upon from time to time.

         3.       Term. The employment relationship pursuant to this Agreement
shall commence on the Effective Date set forth above and continue until
terminated in accordance with the terms of this Agreement (the "EMPLOYMENT
TERM").

         4.       Compensation.

                  4.1      Base Salary. As compensation for Executive's
performance of Executive's duties hereunder, Company shall pay to Executive a
salary of $400,000 per year, payable in equal semi-monthly installments of
$16,666.67 and in accordance with the normal payroll practices of Company, less
required deductions for state and federal withholding tax, social security and
all other employment taxes and authorized payroll deductions. Executive's Base
Salary will be reviewed by the parties on or before each anniversary of the
Effective Date and may be increased or decreased from time to time during the
Employment Term by such amount(s) as Company and Executive may agree to in
writing.

                  4.2      Incentive Compensation. In addition, Executive will
also be eligible to receive incentive compensation subject to the terms and
conditions as the Board may from time to time deem appropriate in its sole and
absolute discretion ("BONUS"). Unless otherwise provided herein, the payment of
any Bonus pursuant to this Section 4.2 shall be made in accordance with the
normal payroll practices of Company, less required deductions for state and
federal withholding tax, social security and all other employment taxes and
authorized payroll deductions.

                  4.3      Performance and Salary Review. The Board will
periodically review Executive's performance on no less than an annual basis.
Adjustments to salary or other compensation, if any, will be made by the Board
in its sole and absolute discretion.

         5.       Benefits.

                  5.1      Fringe Benefits and Facilities. Executive will be
eligible for all customary and usual fringe benefits generally available to
executives of Company subject to the terms and conditions of Company's benefit
plan documents. Company reserves the right to change or eliminate the fringe
benefits on a prospective basis, at any time, effective upon notice to
Executive; provided, however, that during the period of employment under this
Agreement, Executive (and his spouse and eligible dependents) shall be entitled
to receive all benefits of employment generally available to other members of
Company's management and those benefits for which key executives are or shall
become eligible, when and as Executive becomes eligible therefore, including,
without limitation, group health, life and disability insurance benefits and
participation in Company's 401(k) plan. Company further agrees to furnish
Executive with such assistance and accommodations (i.e., an office in the size,
type and quality as provided to Executive prior to the Effective Date) as shall
be suitable to the character of Executive's position with Company and adequate
for the performance of Executive's duties hereunder.

                  5.2      Benefits Payable Upon Disability or Death. If
Executive shall be prevented during the term of this Agreement from properly
performing services hereunder by

                                      -2-


reason of illness or other physical or mental incapacity ("DISABILITIES"),
Company shall continue to pay Executive the then current salary hereunder for a
period of twelve (12) months, following the onset of such disability. In the
event of the death of Executive during the term of this Agreement, Executive's
then current salary payable hereunder shall continue to be paid, as a death
benefit, to Executive's surviving spouse, or if there is no spouse surviving,
then to Executive's personal representative (as the case may be) for a period of
twelve (12) months following Executive's death.

         6.       Business Expenses. Executive will be reimbursed for all
reasonable, out-of-pocket business expenses incurred in the performance of
Executive's duties on behalf of Company. To obtain reimbursement, expenses must
be submitted promptly with appropriate supporting documentation in accordance
with Company's policies.

         7.       Termination of Executive's Employment.

                  7.1      Termination for Cause by Company. The Board may
terminate Executive's employment immediately at any time for Cause by delivering
written notice specifying the cause to Executive; provided, however, that such
written notice shall not be delivered until after the Board shall have given
Executive written notice specifying the conduct alleged to have constituted such
cause, and Executive has failed to cure such conduct within thirty (30) days
following receipt of such notice. For purposes of this Agreement, "CAUSE" is
defined as: (a) theft, dishonesty, or intentional falsification of any
employment or Company records; improper disclosure of Company's confidential or
proprietary information; (b) Executive's conviction (including any plea of
guilty or nolo contendere) for any criminal act that materially impairs his
ability to perform his duties for Company; or (c) a material breach of this
Agreement by Executive which is not cured within thirty (30) days of receipt by
Executive of reasonably detailed written notice from Company. In the event
Executive's employment is terminated in accordance with this Section 7.1,
Executive shall be entitled to receive only unpaid Base Salary then in effect,
prorated to the date of termination, together with any amounts to which
Executive is entitled pursuant to Sections 5 or 6 hereof. All other Company
obligations to Executive pursuant to this Agreement will become automatically
terminated and completely extinguished. Executive will not be entitled to
receive the Severance Payments described in Section 7.2, below.

                  7.2      Termination Without Cause by Company/Severance.
Company may terminate Executive's employment under this Agreement without Cause
at any time on sixty (60) days' advance written notice to Executive. In the
event of such termination, Executive will receive in one lump sum payment (i)
the unpaid Base Salary then in effect, prorated to the effective date of
termination; (ii) his Base Salary for thirty-six (36) months from the
termination date; and (iii) any amounts to which Executive is entitled pursuant
to Sections 5 or 6 hereof (the "SEVERANCE PAYMENTS"), provided that Executive:
(a) complies with all surviving provisions of this Agreement, including without
limitation those provisions specified in Section 14.8, below; and (b) executes a
full general release, releasing all claims, known or unknown, that Executive may
have against Company arising out of or any way related to Executive's employment
or termination of employment with Company, in substantially the form attached
hereto as Exhibit A, or in another form that is acceptable to Company in its
sole discretion. All other Company obligations to Executive will be
automatically terminated and completely extinguished upon termination of
employment.

                  7.3      Termination for Good Reason by Executive/Severance.
Executive may terminate Executive's employment under this Agreement for Good
Reason (defined below) at

                                      -3-


any time on five (5) days' advance written notice to Company. In the event of
such termination, Executive will be entitled to receive the Severance Payments
described in Section 7.2, above, provided that Executive complies with the
conditions to receiving the Severance Payments described in Section 7.2(a) -
7.2(b), above. All other Company obligations to Executive will be automatically
terminated and completely extinguished upon termination of employment.

                  For purposes of this Agreement, "GOOD REASON" is defined as
the occurrence of any of the following conditions:

                  (a)      a material, adverse change in Executive's
responsibilities or duties, causing Executive's position to be of materially
less stature or responsibility; provided, that for purposes of this Agreement
and without limiting the generality of the foregoing, a material, adverse change
shall be deemed to occur if Executive no longer serves as Chairman and CEO of a
publicly-traded company;

                  (b)      the relocation of Executive's work place for Company
over Executive's written objection to a location more than thirty (30) miles
from Scottsdale, Arizona;

                  (c)      a failure to pay, or any reduction of Executive's
Base Salary or Executive's Bonus without Executive's written consent (subject to
applicable performance requirements with respect to the actual amount of Bonus
earned by Executive); or

                  (d)      any material breach of this Agreement by Company that
is not cured within thirty (30) days of Company's receipt of written notice from
Executive specifying the material breach of this Agreement.

                  7.4      Voluntary Resignation by Executive. Executive may
voluntarily resign Executive's position with Company for any reason, at any time
after the Effective Date, on five (5) days' advance written notice. In the event
of Executive's resignation, Executive will be entitled to receive only the Base
Salary for the five-day notice period and no other amount for the remaining
Employment Term (other than amounts to which Executive is entitled pursuant to
Section 5 or 6 hereof). All other Company obligations to Executive pursuant to
this Agreement will become automatically terminated and completely extinguished
upon termination of employment. In addition, Executive will not be entitled to
receive any Severance Payments described in Section 7.2, above. The provisions
of this Section 7.4 shall not apply to Executive's resignation for Good Reason.

                  7.5      Federal Excise Tax Under Section 4999 of the Code.

                  (a)      Additional Payment. In the event that any payment or
benefit received or to be received by Executive pursuant to this Agreement or
otherwise payable to Executive (collectively, the "PAYMENTS") would be subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986,
as amended (the "CODE"), or any similar or successor provision (the "EXCISE
TAX"), Company shall pay to Executive within ninety (90) days of the date
Executive becomes subject to the Excise Tax, an additional amount (the "GROSS-UP
PAYMENT") such that the net amount retained by Executive from the Payments and
the Gross-Up Payment, after deduction of (1) any Excise Tax on the Payments and
(2) any federal, state and local income or employment tax and Excise Tax upon
the payment provided for by this Section, shall be equal to the Payments.

                                      -4-


                  (b)      Determination of Excise Tax. For purposes of
determining whether any of the Payments will be subject to the Excise Tax and
the amount of such Excise Tax:

                           (i)      Any payments or benefits received or to be
received by Executive in connection with transactions contemplated by a Change
of Control (as defined below) event or Executive's termination of employment
(whether pursuant to the terms of this Agreement or any other plan, arrangement
or agreement with Company), shall be treated as "parachute payments" within the
meaning of Section 280G of the Code or any similar or successor provision, and
all "excess parachute payments" within the meaning of Section 280G of the Code
or any similar or successor provision shall be treated as subject to the Excise
Tax, unless in the opinion of tax counsel ("TAX COUNSEL") selected by Company
and reasonably acceptable to Executive such payments or benefits (in whole or in
part) do not constitute parachute payments, or such excess parachute payments
(in whole or in part) represent reasonable compensation for services actually
rendered within the meaning of Section 280G of the Code (or any similar or
successor provision of the Code) in excess of the base amount within the meaning
of Section 280G of the Code (or any similar or successor provision of the Code),
or are otherwise not subject to the Excise Tax.

                           (ii)     The amount of the Payments which shall be
treated as subject to the Excise Tax shall be equal to the lesser of (i) the
total amount of the Payments or (ii) the amount of the excess parachute payments
within the meaning of Section 280G of the Code (after applying paragraph (b)(1)
above).

                           (iii)    The value of any non-cash benefits or any
deferred payment or benefit shall be determined by Tax Counsel in accordance
with the principles of Section 280G of the Code.

                           (iv)     Change of Control. A "CHANGE OF CONTROL" is
defined as any one of the following occurrences:

                                    a)       Any "person" (as such term is used
in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the
"EXCHANGE ACT")), other than a trustee or other fiduciary holding securities of
Company under an employee benefit plan of Company, becomes the "beneficial
owner" (as defined in Rule 13d-3 promulgated under the Exchange Act), directly
or indirectly, of the securities of Company representing 50% or more of (A) the
outstanding shares of common stock of Company or (B) the combined voting power
of Company's then-outstanding securities; or

                                    b)       the sale or disposition of all or
substantially all of Company's assets (or any transaction having similar effect
is consummated); or

                                    c)       Company is party to a merger or
consolidation that results in the holders of voting securities of Company
outstanding immediately prior thereto failing to continue to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) at least 50% of the combined voting power of the voting
securities of Company or such surviving entity outstanding immediately after
such merger or consolidation; or

                                    d)       a liquidation or dissolution of
Company.

                                      -5-


                  (c)      Determination of Gross-Up Payment. For purposes of
determining the amount of the Gross-Up Payment, Executive shall be deemed to pay
federal income taxes at the highest marginal rate of federal income taxation in
the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rate of taxation in the state and
locality of Executive's residence on the date the Gross-Up Payment is to be
made, net of the maximum reduction in federal income taxes which could be
obtained from deduction of such state and local taxes.

                  (d)      Adjustments.

                           (i)      In the event that the Excise Tax is
subsequently determined to be less than the amount taken into account hereunder,
Executive shall repay to Company at the time that the amount of such reduction
in Excise Tax is finally determined the portion of the Gross-Up Payment
attributable to such reduction (plus the portion of the Gross-Up Payment
attributable to the Excise Tax and federal, state and local income and
employment taxes imposed on the Gross-Up Payment being repaid by Executive if
such repayment results in a reduction in Excise Tax and/or a federal, state or
local income or employment tax deduction) plus interest on the amount of such
repayment at the rate provided in Section 1274(b)(2)(B) of the Code.

                           (ii)     In the event that the Excise Tax is
determined to exceed the amount taken into account hereunder (including by
reason of any payment the existence or amount of which cannot be determined at
the time of the Gross-Up Payment), Company shall make an additional gross-up
payment in respect of such excess (plus any interest payable with respect to
such excess) at the time that the amount of such excess is finally determined.

                  7.6      Termination for Death or Permanent Disability. Upon
Executive's death or permanent disability (a disability which has continued for
a period of twelve (12) months from the date of onset of such disability), this
Agreement shall terminate; provided that Executive and Executive's spouse (or
surviving spouse, as the case may be) and eligible dependents shall be entitled
to continuation rights under Company's group health plans as required under
COBRA, with the "qualifying event" occurring and minimum required period of
coverage to commence upon the termination of this Agreement; and provided
further that, in the event of Executive's death, Executive's surviving spouse or
personal representative, as the case may be, shall be entitled to the death
benefits described in Section 5.2.

         8.       No Conflict of Interest. During the term of Executive's
employment with Company, Executive must not engage in any work, paid or unpaid,
that creates an actual or potential conflict of interest with Company. If the
Board reasonably believes such a conflict exists during the term of this
Agreement, the Board may ask Executive to choose to discontinue the other work
or resign employment with Company.

         9.       Post-Termination Non-Competition.

                  9.1      Consideration For Promise To Refrain From Competing.
Executive agrees that Executive's services are special and unique, that
Company's disclosure of confidential, proprietary information and specialized
training and knowledge to Executive, and that Executive's level of compensation
and benefits, including, without limitation, the severance payments provided for
in this Agreement, are partly in consideration of and conditioned upon Executive
not competing with Company. Executive acknowledges that such consideration is
adequate for Executive's promises contained within this Section 9.

                                      -6-


                  9.2      Promise To Refrain From Competing. Executive
understands Company's need for Executive's promise not to compete with Company
is based on the following: (a) Company has expended, and will continue to
expend, substantial time, money and effort in developing its proprietary
information; (b) Executive will in the course of Executive's employment develop,
be personally entrusted with and exposed to Company's proprietary information;
(c) both during and after the term of Executive's employment, Company will be
engaged in the highly competitive enterprise software industry; (d) Company
provides products and services nationally and internationally; and (e) Company
will suffer great loss and irreparable harm if Executive were to enter into
competition with Company. Therefore, in exchange for the consideration described
in Section 9.1 above, Executive agrees that for the period of three (3) years
following the date Executive ceases to render services to Company (the "COVENANT
PERIOD"), Executive will not either directly or indirectly, whether as an owner,
director, officer, manager, consultant, agent or employee: (i) work for a
competitor of Company, which is defined to include those entities or persons in
the business of developing, marketing, selling and supporting software designed
for businesses in the retail and consumer packaged goods markets or in the
business of helping companies synchronize their inventory decisions with
advanced supply chain, inventory management and data mining solutions, in any
country in which Company does business (the "RESTRICTED BUSINESS"); or (ii) make
or hold any investment in any Restricted Business, whether such investment be by
way of loan, purchase of stock or otherwise, provided that there shall be
excluded from the foregoing the ownership of not more than 5% of the listed or
traded stock of any publicly held corporation. For purposes of this Section 9,
the term "COMPANY" shall mean and include Company, any subsidiary or affiliate
of Company, any successor to the business of Company (by merger, consolidation,
sale of assets or stock or otherwise) and any other corporation or entity of
which Executive may serve as a director, officer or employee at the request of
Company or any successor of Company.

                  9.3      Reasonableness of Restrictions. Executive represents
and agrees that the restrictions on competition, as to time, geographic area,
and scope of activity, required by this Section 9 are reasonable, do not impose
a greater restraint than is necessary to protect the goodwill and business
interests of Company, and are not unduly burdensome to Executive. Executive
expressly acknowledges that Company competes on an international basis and that
the geographical scope of these limitations is reasonable and necessary for the
protection of Company's trade secrets and other confidential and proprietary
information. Executive further agrees that these restrictions allow Executive an
adequate number and variety of employment alternatives, based on Executive's
varied skills and abilities. Executive represents that Executive is willing and
able to compete in other employment not prohibited by this Agreement.

                  9.4      Reformation if Necessary. In the event a court of
competent jurisdiction determines that the geographic area, duration, or scope
of activity of any restriction under this Section 9 and its subsections is
unenforceable, the restrictions under this section and its subsections shall not
be terminated but shall be reformed and modified to the extent required to
render them valid and enforceable. Executive further agrees that the court may
reform this Agreement to extend the Covenant Period by an amount of time equal
to any period in which Executive is in breach of this covenant.

         10.      Confidentiality. Executive agrees to abide by Company's letter
agreement dated as of January 1, 1998, which is incorporated by this reference
whereby Executive covenants and agrees to keep confidential that information
known by or made available to Executive on account of his relationship with
Company (the "LETTER AGREEMENT").

         11.      Nonsolicitation.

                                      -7-


                  11.1     Nonsolicitation of Customers or Prospects. Executive
acknowledges that information about Company's customers is confidential and
constitutes trade secrets. Accordingly, Executive agrees that during the term of
this Agreement and for a period of two (2) years after the termination of this
Agreement, Executive will not, either directly or indirectly, separately or in
association with others, interfere with, impair, disrupt or damage Company's
relationship with any of its customers or customer prospects by soliciting or
encouraging others to solicit any of them for the purpose of diverting or taking
away business from Company.

                  11.2     Nonsolicitation of Company's Employees. Executive
agrees that during the term of this Agreement and for a period of three (3)
years after the termination of this Agreement, Executive will not, either
directly or indirectly, separately or in association with others, interfere
with, impair, disrupt or damage Company's business by soliciting, encouraging,
hiring or attempting to hire any of Company's employees or causing others to
solicit or encourage any of Company's employees to discontinue their employment
with Company. Notwithstanding the previous sentence, the Executive may give
references for employees and tell headhunters the names of employees of Company,
in either event, where the Executive is aware that the employee has been
identified by Company as not being part of its long-term plans after a Change of
Control.

         12.      Injunctive Relief. Executive acknowledges that Executive's
breach of the covenants contained in Sections 9-11 (collectively "COVENANTS")
would cause irreparable injury to Company and agrees that in the event of any
such breach, Company shall be entitled to seek temporary, preliminary and
permanent injunctive relief without the necessity of proving actual damages or
posting any bond or other security.

         13.      Agreement to Arbitrate. To the fullest extent permitted by
law, Executive and Company agree to arbitrate any controversy, claim or dispute
between them arising out of or in any way related to this Agreement, the
employment relationship between Company and Executive and any disputes upon
termination of employment, including but not limited to breach of contract,
tort, discrimination, harassment, wrongful termination, demotion, discipline,
failure to accommodate, family and medical leave, compensation or benefits
claims, constitutional claims; and any claims for violation of any local, state
or federal law, statute, regulation or ordinance or common law. Claims for
breach of Company's Employee Innovations and Proprietary Rights Agreement,
workers' compensation, unemployment insurance benefits and Company's right to
obtain injunctive relief pursuant to Section 12 above are excluded. For the
purpose of this agreement to arbitrate, references to "Company" include all
parent, subsidiary or related entities and their employees, supervisors,
officers, directors, agents, pension or benefit plans, pension or benefit plan
sponsors, fiduciaries, administrators, affiliates and all successors and assigns
of any of them, and this Agreement shall apply to them to the extent Executive's
claims arise out of or relate to their actions on behalf of Company.

                  13.1     Initiation of Arbitration. Either party may exercise
the right to arbitrate by providing the other party with written notice of any
and all claims forming the basis of such right in sufficient detail to inform
the other party of the substance of such claims. In no event shall the request
for arbitration be made after the date when institution of legal or equitable
proceedings based on such claims would be barred by the applicable statute of
limitations.

                  13.2     Arbitration Procedure. The arbitration will be
conducted in Maricopa county, Arizona, by a single neutral arbitrator and in
accordance with the then current rules for resolution of employment disputes of
the American Arbitration Association ("AAA"). The parties

                                      -8-


are entitled to representation by an attorney or other representative of their
choosing. The arbitrator shall have the power to enter any award that could be
entered by a judge of the trial court of the State of Arizona, and only such
power, and shall follow the law. The parties agree to abide by and perform any
award rendered by the arbitrator. Judgment on the award may be entered in any
court having jurisdiction thereof.

                  13.3     Costs of Arbitration. Each party shall bear one half
the cost of the arbitration filing and hearing fees, and the cost of the
arbitrator.

         14.      General Provisions.

                  14.1     Successors and Assigns. The rights and obligations of
Company under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of Company. Executive shall not be entitled to
assign any of Executive's rights or obligations under this Agreement.

                  14.2     Waiver. Either party's failure to enforce any
provision of this Agreement shall not in any way be construed as a waiver of any
such provision, or prevent that party thereafter from enforcing each and every
other provision of this Agreement.

                  14.3     Attorneys' Fees. In any dispute relating to this
Agreement, the losing party shall pay the attorneys' fees of the prevailing
party in addition to its own attorneys' fees.

                  14.4     Severability. In the event any provision of this
Agreement is found to be unenforceable by an arbitrator or court of competent
jurisdiction, such provision shall be deemed modified to the extent necessary to
allow enforceability of the provision as so limited, it being intended that the
parties shall receive the benefit contemplated herein to the fullest extent
permitted by law. If a deemed modification is not satisfactory in the judgment
of such arbitrator or court, the unenforceable provision shall be deemed
deleted, and the validity and enforceability of the remaining provisions shall
not be affected thereby.

                  14.5     Interpretation; Construction. The headings set forth
in this Agreement are for convenience only and shall not be used in interpreting
this Agreement. This Agreement has been drafted by legal counsel representing
Company, but Executive has participated in the negotiation of its terms.
Furthermore, Executive acknowledges that Executive has had an opportunity to
review and revise the Agreement and have it reviewed by legal counsel, if
desired, and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement.

                  14.6     Governing Law. This Agreement will be governed by and
construed in accordance with the laws of the United States and the State of
Arizona. Each party consents to the jurisdiction and venue of the state or
federal courts in Maricopa county, Arizona, if applicable, in any action, suit,
or proceeding arising out of or relating to this Agreement.

                  14.7     Notices. Any notice required or permitted by this
Agreement shall be in writing and shall be delivered as follows with notice
deemed given as indicated: (a) by personal delivery when delivered personally;
(b) by overnight courier upon written verification of receipt; (c) by telecopy
or facsimile transmission upon acknowledgment of receipt of electronic
transmission; or (d) by certified or registered mail, return receipt requested,
upon verification of

                                      -9-


receipt. Notice shall be sent to the addresses set forth below, or such other
address as either party may specify in writing.

                  14.8     Survival. Sections 8 ("No Conflict of Interest"), 9
("Post-Termination Non-Competition"), 10 ("Confidentiality and Proprietary
Rights"), 11 ("Nonsolicitation"), 12 ("Injunctive Relief"), 13 ("Agreement to
Arbitrate"), 14 ("General Provisions") and 15 ("Entire Agreement") of this
Agreement shall survive Executive's employment by Company.

         15.      Entire Agreement. This Agreement, including the Letter
Agreement incorporated herein by reference, constitutes the entire agreement
between the parties relating to this subject matter and supersedes all prior or
simultaneous representations, discussions, negotiations, and agreements, whether
written or oral. This Agreement may be amended or modified only with the written
consent of Executive and the Board. No oral waiver, amendment or modification
will be effective under any circumstances whatsoever.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

                                      -10-


               [SIGNATURE PAGE TO ARMSTRONG EMPLOYMENT AGREEMENT]

THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.

                                         EXECUTIVE

Dated: 7-23-02                           /s/ James D. Armstrong
                                         ---------------------------------------
                                         JAMES D. ARMSTRONG

                                         ADDRESS _______________________________
                                         _______________________________________
                                         _______________________________________


                                         COMPANY

Dated: 7-23-02                           By: /s/ Kristen L. Magnuson
                                             -----------------------------------
                                         Name: _________________________________
                                         Title: ________________________________

               [SIGNATURE PAGE TO ARMSTRONG EMPLOYMENT AGREEMENT]



                                    EXHIBIT A

                             Form of Mutual Release

See attached.


                            JDA SOFTWARE GROUP, INC.

                AMENDMENT NO. 1 TO EXECUTIVE EMPLOYMENT AGREEMENT
                              OF JAMES D. ARMSTRONG

         This Amendment No. 1 (this "AMENDMENT") to James D. Armstrong's
Executive Employment Agreement entered into on July 23, 2002 (the "ORIGINAL
EMPLOYMENT AGREEMENT") is effective as of August 1, 2003, by and between JDA
Software Group, Inc. (the "COMPANY") and James D. Armstrong (the "EXECUTIVE").

                                    RECITALS

         WHEREAS, on July 23, 2002, Executive and the Company entered into the
Original Employment Agreement.

         WHEREAS, on August 1, 2003, Executive resigned as Chief Executive
Officer ("CEO") of the Company.

         WHEREAS, Section 15 of the Original Employment Agreement vests
Executive and the Company's Board of Directors (the "BOARD") with the power to,
among other things, amend the Original Employment Agreement.

         WHEREAS, the Board accepted Executive's resignation and approved this
Amendment effective as of the date hereof.

         WHEREAS, Executive and the Company desire to amend the Original
Employment Agreement in accordance with Section 15 thereof as hereafter set
forth.

                 AMENDMENT TO THE ORIGINAL EMPLOYMENT AGREEMENT

         NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         1.       Section 2.1 of the Original Employment Agreement is hereby
amended and restated to read in its entirety as follows:

                  2.1      Position. Executive is employed as Chairman of the
         Board of Directors ("CHAIRMAN") of Company. Executive shall perform
         faithfully and diligently all duties assigned to Executive. The Board
         of Directors of Company ("BOARD") reserves the right to modify
         Executive's position and duties at any time in its sole and absolute
         discretion, provided that the duties assigned are consistent with the
         position of Chairman.

         2.       Section 2.2 of the Original Employment Agreement is hereby
amended and restated to read in its entirety as follows:



                  2.2      Standard of Conduct/Full-time. During the term of
         this Agreement, Executive will act loyally and in good faith to
         discharge the duties of Chairman, and will abide by all policies and
         decisions made by Company, as well as all applicable federal, state and
         local laws, regulations or ordinances. Executive will act solely on
         behalf of Company at all times. Executive shall devote Executive's full
         business time and efforts to the performance of Executive's assigned
         duties for Company, unless Executive notifies the Board in advance of
         Executive's intent to engage in other paid work and receives the
         Board's express written consent to do so.

         3.       Section 4.1 of the Original Employment Agreement is hereby
amended and restated to read in its entirety as follows:

                  4.1      Base Salary. As compensation for Executive's
         performance of Executive's duties hereunder, Company shall pay to
         Executive a salary of $250,000 per year, payable in equal semi-monthly
         installments and in accordance with the normal payroll practices of
         Company, less required deductions for state and federal withholding
         tax, social security and all other employment taxes and authorized
         payroll deductions. Executive's Base Salary will be reviewed by the
         parties on or before each anniversary of the Effective Date and may be
         increased or decreased from time to time during the Employment Term by
         such amount(s) as Company and Executive may agree to in writing.

         4.       Section 4.2 of the Original Employment Agreement is hereby
amended and restated in its entirety as follows:

                  4.2      Incentive Compensation. Executive will not be
         eligible to receive cash bonus incentive compensation. Executive may be
         eligible to receive non-cash incentive compensation in the form of
         option grants, subject to the terms and conditions as the Board may
         from time to time deem appropriate in its sole and absolute discretion.

         5.       Subparagraphs (a) and (b) of Section 7.2 of the Original
Employment Agreement are hereby amended and restated to read in their entirety
as follows:

                  (a)      a material, adverse change in Executive's
         responsibilities or duties, causing Executive's position to be of
         materially less stature or responsibility; provided, that for purposes
         of this Agreement and without limiting the generality of the foregoing,
         a material, adverse change shall be deemed to occur if Executive no
         longer serves as Chairman of a publicly-traded company;

                  (b)      failure to pay, or any reduction of Executive's Base
         Salary without Executive's written consent; or

                                       -2-



         6.       Miscellaneous.

                  (a)      Except as expressly amended as provided above, the
Original Employment Agreement remains unmodified and in full force and effect
and is hereby renewed, ratified and affirmed by the Company and Executive.

                  (b)      This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original. Any party may execute
this Amendment by facsimile signature, which shall be deemed to constitute an
original for all purposes.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

                                      -3-



THE PARTIES TO THIS AMENDMENT HAVE READ THE FOREGOING AMENDMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AMENDMENT ON THE DATE(S) SHOWN BELOW.

                                             EXECUTIVE

Dated: 8-1-03                                /s/ JAMES D. ARMSTRONG
                                             -----------------------------------
                                             JAMES D. ARMSTRONG

                                             Address____________________________

                                             ___________________________________

                                             ___________________________________

                                             COMPANY

                                             JDA SOFTWARE GROUP, INC.

Dated: 8-1-03                                By: /s/ Hamish Brewer
                                                 -------------------------------
                                             Name: Hamish Brewer
                                             Title : CHIEF EXECUTIVE OFFICER

      [SIGNATURE PAGE TO AMENDMENT NO. 1 TO EXECUTE EMPLOYMENT AGREEMENT OF
                               JAMES D. ARMSTRONG]

EX-10.6

                                                                    EXHIBIT 10.6

                         EXECUTIVE EMPLOYMENT AGREEMENT

         This Executive Employment Agreement ("AGREEMENT") is made effective as
of January 22, 2003 ("EFFECTIVE DATE"), by and between JDA Software Group, Inc.,
a Delaware corporation ("COMPANY") and Hamish N. Brewer ("EXECUTIVE") (either
party individually, a "PARTY"; collectively, the "PARTIES").

         WHEREAS, Company desires to retain the services of Executive as
President;

         WHEREAS, the Parties desire to enter into this Agreement to set forth
the terms and conditions of Executive's employment by Company and to address
certain matters related to Executive's employment with Company;

         NOW, THEREFORE, in consideration of the foregoing and the mutual
provisions contained herein, and for other good and valuable consideration, the
Parties hereto agree as follows:

         1.       Employment. Company hereby employs Executive, and Executive
hereby accepts such employment, upon the terms and conditions set forth herein.

         2.       Duties.

                  2.1      Position. Executive is employed as President and
shall have the duties and responsibilities assigned by Company's Chief Executive
Officer ("CEO") both upon initial hire and as may be reasonably assigned from
time to time. Executive shall perform faithfully and diligently all duties
assigned to Executive. Company reserves the right to modify Executive's position
and duties at any time in its sole and absolute discretion, provided that the
duties assigned are consistent with the position of a senior executive officer
and that Executive continues to report directly to the CEO.

                  2.2      Standard of Conduct/Full-time. During the term of
this Agreement, Executive will act loyally and in good faith to discharge the
duties of President, and will abide by all policies and decisions made by
Company, as well as all applicable federal, state and local laws, regulations or
ordinances. Executive will act solely on behalf of Company at all times.
Executive shall devote Executive's full business time and efforts to the
performance of Executive's assigned duties for Company, unless Executive
notifies the CEO in advance of Executive's intent to engage in other paid work
and receives the CEO's express written consent to do so.

                  2.3      Work Location. Executive's principal place of work
shall be located in Scottsdale, Arizona or such other location as the parties
may agree upon from time to time.

         3.       Term.

                  3.1      Initial Term. Unless sooner terminated in accordance
with the terms of this Agreement, the employment relationship pursuant to this
Agreement shall be for an initial term commencing on the Effective Date set
forth above and continuing for three (3) years from the Effective Date or, if
Executive accepts a position of employment with any successor to the business of
Company (by merger, consolidation, sale of assets or stock or otherwise) after a
Change of Control (as defined in Section 7.5(b)(iv)) below) that occurs within
three (3) years of



the Effective Date, the initial term shall continue for eighteen (18) months
from the date of the Change of Control (each, an "INITIAL TERM").

                  3.2      Renewal. On completion of the Initial Term specified
in Section 3.1 above, this Agreement will automatically renew for subsequent
one-year terms unless either party provides ninety (90) days' advance written
notice to the other that such party does not wish to renew the Agreement for a
subsequent one-year term. In the event either party gives notice of nonrenewal
pursuant to this Section 3.2, this Agreement will expire at the end of the
then-current term.

         4.       Compensation.

                  4.1      Base Salary. As compensation for Executive's
performance of Executive's duties hereunder, Company shall pay to Executive a
salary of $250,000 per year, payable in equal bi-monthly installments and in
accordance with the normal payroll practices of Company, less required
deductions for state and federal withholding tax, social security and all other
employment taxes and authorized payroll deductions.

                  4.2      Stock Options. Subject to approval by Company's Board
of Directors (the "BOARD"), Company will from time to time grant to Executive an
option to purchase shares of Company's common stock (the "OPTION"). The Option
will be subject to the terms and conditions of one of Company's Stock Option
Plans as designated by the Board (the "PLAN"). The Option will also be subject
to the terms and conditions contained in the special form of option agreement
previously adopted by the Board for the Senior Executives, a form of which is
attached hereto as Exhibit A (the "FORM OPTION AGREEMENT") and shall vest over a
period of three (3) years in accordance with the terms of the Form Option
Agreement and the Plan. The Option shall be subject to certain acceleration
provisions described in the Form Option Agreement and this Agreement.

                  4.3      Incentive Compensation. In addition, Executive will
also be eligible to receive incentive compensation subject to the terms and
conditions contained in the Executive Bonus Plan, which is approved by the Board
and is subject to amendment from time to time by the Board in its sole and
absolute discretion. Unless otherwise provided herein, the payment of any Bonus
pursuant to this Section 4.3 shall be made in accordance with the normal payroll
practices of Company, less required deductions for state and federal withholding
tax, social security and all other employment taxes and authorized payroll
deductions.

                  4.4      Performance and Salary Review. The Board will
periodically review Executive's performance on no less than an annual basis.
Adjustments to salary or other compensation, if any, will be made by the Board
in its sole and absolute discretion.

         5.       Customary Fringe Benefits and Facilities. Executive will be
eligible for all customary and usual fringe benefits generally available to
executives of Company subject to the terms and conditions of Company's benefit
plan documents. Company reserves the right to change or eliminate the fringe
benefits on a prospective basis, at any time, effective upon notice to
Executive; provided, however, that during the period of employment under this
Agreement, Executive (and his spouse and eligible dependents) shall be entitled
to receive all benefits of employment generally available to other members of
Company's management and those benefits for which key executives are or shall
become eligible, when and as Executive becomes eligible therefore, including,
without limitation, group health, life and disability insurance benefits and
participation in Company's 401(k) plan. Company further agrees to

                                       2


furnish Executive with such assistance and accommodations (i.e., an office in
the size, type and quality as provided to Executive prior to the Effective Date)
as shall be suitable to the character of Executive's position with Company and
adequate for the performance of Executive's duties hereunder.

         6.       Business Expenses. Executive will be reimbursed for all
reasonable, out-of-pocket business expenses incurred in the performance of
Executive's duties on behalf of Company. To obtain reimbursement, expenses must
be submitted promptly with appropriate supporting documentation in accordance
with Company's policies.

         7.       Termination of Executive's Employment.

                  7.1      Termination for Cause by Company. Company may
terminate Executive's employment immediately at any time for Cause. For purposes
of this Agreement, "CAUSE" is defined as: (a) theft, dishonesty, or intentional
falsification of any employment or Company records; improper disclosure of
Company's confidential or proprietary information; (b) Executive's conviction
(including any plea of guilty or nolo contendere) for any criminal act that
materially impairs his ability to perform his duties for Company; or (c) a
material breach of this agreement by Executive which is not cured within thirty
(30) days of receipt by executive of reasonably detailed written notice from
Company. In the event Executive's employment is terminated in accordance with
this Section 7.1, Executive shall be entitled to receive only unpaid Base Salary
then in effect, prorated to the date of termination, together with any amounts
to which Executive is entitled pursuant to Sections 5 or 6 hereof. Executive
shall be entitled to any benefit or right to which Executive is entitled
pursuant to the Plan, however, there shall be no additional vesting under
Executive's Option. All other Company obligations to Executive pursuant to this
Agreement will become automatically terminated and completely extinguished.
Executive will not be entitled to receive the Severance Payments described in
Section 7.2, below.

                  7.2      Termination Without Cause by Company/Severance.
Company may terminate Executive's employment under this Agreement without Cause
at any time on sixty (60) days' advance written notice to Executive. In the
event of such termination, Executive will receive in one lump sum payment, (i)
the unpaid Base Salary then in effect, prorated to the effective date then in
effect; (ii) his Base Salary for twenty-four (24) months from the termination
date plus one year's expected Bonus pursuant to Section 4.3 of this Agreement,
and assuming satisfaction of all performance based milestones by both Company
and the Executive; (iii) any amounts to which Executive is entitled pursuant to
Section 5 or 6 hereof; and (iv) any benefit or right to which Executive is
entitled pursuant to the Plan and Option Agreements delivered to Executive in
connection with the grant of Options to Executive (the "SEVERANCE Payments"),
provided that Executive: (a) complies with all surviving provisions of this
Agreement, including without limitation those provisions specified in Section
14.8, below; and (b) executes a full general release, releasing all claims,
known or unknown, that Executive may have against Company arising out of or any
way related to Executive's employment or termination of employment with Company,
in substantially the form attached hereto as Exhibit B, or in another form that
is acceptable to Company in its sole discretion. All other Company obligations
to Executive will be automatically terminated and completely extinguished upon
termination of employment.

                  7.3      Termination for Good Reason by Executive/Severance.
Executive may terminate Executive's employment under this Agreement for Good
Reason (defined below) at any time on five (5) days' advance written notice to
Company. In the event of such termination,

                                       3


Executive will be entitled to receive the Severance Payments described in
Section 7.2, above, provided that Executive complies with the conditions to
receiving the Severance Payments described in Sections 7.2(a) and 7.2(b), above.
All other Company obligations to Executive will be automatically terminated and
completely extinguished upon termination of employment.

         For purposes of this Agreement, "GOOD REASON" is defined as the
occurrence of any of the following conditions:

                           (i)      a failure to pay, or any reduction of
Executive's Base Salary as in effect immediately prior to the Change of Control
(as defined in Section 7.5(b)(iv)) or Executive's Bonus in effect prior to the
Change of Control (subject to applicable performance requirements with respect
to the actual amount of Bonus earned by Executive); or

                           (ii)     any material breach of this Agreement by
Company that is not cured within thirty (30) days after Company's receipt of
written notice from Executive specifying the material breach of this Agreement.

                  7.4      Voluntary Resignation by Executive. Executive may
voluntarily resign Executive's position with Company for any reason, at any time
after the Effective Date, on five (5) days' advance written notice. In the event
of Executive's resignation, Executive will be entitled to receive only the Base
Salary for the five-day notice period and no other amount for the remaining
months of the current term, whether the Initial Term or a subsequent one-year
term (other than amounts to which Executive is entitled pursuant to Sections 5
or 6 hereof). Executive shall be entitled to any benefit or right to which
Executive is entitled pursuant to the Plan, however, there shall be not
additional vesting under Executive's Option. All other Company obligations to
Executive pursuant to this Agreement will become automatically terminated and
completely extinguished upon termination of employment. In addition, Executive
will not be entitled to receive any Severance Payments described in Section 7.2,
above. The provisions of this Section 7.4 shall not apply to Executive's
resignation for Good Reason.

                  7.5      Federal Excise Tax Under Section 4999 of the Code.

                  (a)      Additional Payment. In the event that any payment or
benefit received or to be received by Executive pursuant to this Agreement or
otherwise payable to Executive (collectively, the "PAYMENTS") would be subject
to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986,
as amended (the "CODE"), or any similar or successor provision (the "EXCISE
TAX"), Company shall pay to Executive within ninety (90) days of the date
Executive becomes subject to the Excise Tax, an additional amount (the "GROSS-UP
PAYMENT") such that the net amount retained by Executive from the Payments and
the Gross-Up Payment, after deduction of (1) any Excise Tax on the Payments and
(2) any federal, state and local income or employment tax and Excise Tax upon
the payment provided for by this Section, shall be equal to the Payments.

                  (b)      Determination of Excise Tax. For purposes of
determining whether any of the Payments will be subject to the Excise Tax and
the amount of such Excise Tax:

                                    (i)      Any payments or benefits received
or to be received by Executive in connection with transactions contemplated by a
Change of Control (as defined below) event or Executive's termination of
employment (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with Company), shall be treated as

                                       4


"parachute payments" within the meaning of Section 280G of the Code or any
similar or successor provision, and all "excess parachute payments" within the
meaning of Section 280G of the Code or any similar or successor provision shall
be treated as subject to the Excise Tax, unless in the opinion of tax counsel
("TAX Counsel") selected by Company and reasonably acceptable to Executive such
payments or benefits (in whole or in part) do not constitute parachute payments,
or such excess parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered within the meaning of Section 280G
of the Code (or any similar or successor provision of the Code) in excess of the
base amount within the meaning of Section 280G of the Code (or any similar or
successor provision of the Code), or are otherwise not subject to the Excise
Tax.

                                    (ii)     The amount of the Payments which
shall be treated as subject to the Excise Tax shall be equal to the lesser of
(i) the total amount of the Payments or (ii) the amount of the excess parachute
payments within the meaning of Section 280G of the Code (after applying
paragraph (b)(1) above).

                                    (iii)    The value of any non-cash benefits
or any deferred payment or benefit shall be determined by Tax Counsel in
accordance with the principles of Section 280G of the Code.

                                    (iv)     Change of Control. A "CHANGE OF
CONTROL" is defined as any one of the following occurrences:

                                             a) Any "person" (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934 (the
"EXCHANGE ACT")), other than a trustee or other fiduciary holding securities of
Company under an employee benefit plan of Company, becomes the "beneficial
owner" (as defined in Rule 13d-3 promulgated under the Exchange Act), directly
or indirectly, of the securities of Company representing 50% or more of (A) the
outstanding shares of common stock of Company or (B) the combined voting power
of Company's then-outstanding securities; or

                                             b) the sale or disposition of all
or substantially all of Company's assets (or any transaction having similar
effect is consummated); or

                                             c) Company is party to a merger or
consolidation that results in the holders of voting securities of Company
outstanding immediately prior thereto failing to continue to represent (either
by remaining outstanding or by being converted into voting securities of the
surviving entity) at least 50% of the combined voting power of the voting
securities of Company or such surviving entity outstanding immediately after
such merger or consolidation; or

                                             d) a liquidation or dissolution of
Company.

                  (c)      Determination of Gross-Up Payment. For purposes of
determining the amount of the Gross-Up Payment, Executive shall be deemed to pay
federal income taxes at the highest marginal rate of federal income taxation in
the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rate of taxation in the state and
locality of Executive's residence on the date the Gross-Up Payment is to be
made, net of the maximum reduction in federal income taxes which could be
obtained from deduction of such state and local taxes.

                                       5


                  (d)      Adjustments.

                                    (i)      In the event that the Excise Tax is
subsequently determined to be less than the amount taken into account hereunder,
Executive shall repay to Company at the time that the amount of such reduction
in Excise Tax is finally determined the portion of the Gross-Up Payment
attributable to such reduction (plus the portion of the Gross-Up Payment
attributable to the Excise Tax and federal, state and local income and
employment taxes imposed on the Gross-Up Payment being repaid by Executive if
such repayment results in a reduction in Excise Tax and/or a federal, state or
local income or employment tax deduction) plus interest on the amount of such
repayment at the rate provided in Section 1274(b)(2)(B) of the Code.

                                    (ii)     In the event that the Excise Tax is
determined to exceed the amount taken into account hereunder (including by
reason of any payment the existence or amount of which cannot be determined at
the time of the Gross-Up Payment), Company shall make an additional gross-up
payment in respect of such excess (plus any interest payable with respect to
such excess) at the time that the amount of such excess is finally determined.

                  7.6      Termination of Employment Upon Nonrenewal. In the
event either party decides not to renew this Agreement for a subsequent one-year
term in accordance with Section 3.2 above, the Agreement will expire,
Executive's employment with Company will terminate and Executive will only be
entitled to (i) Executive's Base Salary paid through the last day of the
then-current term; (ii) any amounts to which Executive is entitled pursuant to
Section 5 or 6 hereof; and (iii) any benefit or right to which Executive is
entitled pursuant to the Plan and Option Agreements delivered to Executive in
connection with the grant of Options to Executive. All other Company obligations
to Executive pursuant to this Agreement will become automatically terminated and
completely extinguished. In addition, Executive will not be entitled to any
Severance Payments described in Section 7.2.

         8.       No Conflict of Interest. During the term of Executive's
employment with Company, Executive must not engage in any work, paid or unpaid,
that creates an actual or potential conflict of interest with Company. If the
Board reasonably believes such a conflict exists during the term of this
Agreement, the Board may ask Executive to choose to discontinue the other work
or resign employment with Company.

         9.       Post-Termination Non-Competition.

                  9.1      Consideration For Promise To Refrain From Competing.
Executive agrees that Executive's services are special and unique, that
Company's disclosure of confidential, proprietary information and specialized
training and knowledge to Executive, and that Executive's level of compensation
and benefits are partly in consideration of and conditioned upon Executive not
competing with Company. Executive acknowledges that such consideration is
adequate for Executive's promises contained within this Section 9.

                  9.2      Promise To Refrain From Competing. Executive
understands Company's need for Executive's promise not to compete with Company
is based on the following: (a) Company has expended, and will continue to
expend, substantial time, money and effort in developing its proprietary
information; (b) Executive will in the course of Executive's employment develop,
be personally entrusted with and exposed to Company's proprietary information;
(c) both during and after the term of Executive's employment, Company will be
engaged in the highly competitive retail demand chain software industry; (d)
Company provides

                                       6


products and services nationally and internationally; and (e) Company will
suffer great loss and irreparable harm if Executive were to enter into
competition with Company. Therefore, in exchange for the consideration described
in Section 9.1 above, Executive agrees that for the period of nine (9) months
following the date Executive ceases to render services to Company (the "COVENANT
PERIOD"), Executive will not either directly or indirectly, whether as an owner,
director, officer, manager, consultant, agent or employee: (i) work for a
competitor of Company, which is defined to include those entities or persons in
the business of developing, marketing, selling and supporting software designed
for businesses in the retail and consumer packaged goods markets or in the
business of helping companies synchronize their inventory decisions with
advanced supply chain, inventory management and data mining solutions, in any
country in which Company does business (the "RESTRICTED BUSINESS"); or (ii) make
or hold during the Covenant Period any investment in any Restricted Business,
whether such investment be by way of loan, purchase of stock or otherwise,
provided that there shall be excluded from the foregoing the ownership of not
more than 1% of the listed or traded stock of any publicly held corporation. For
purposes of this Section 9, the term "COMPANY" shall mean and include Company,
any subsidiary or affiliate of Company, any successor to the business of Company
(by merger, consolidation, sale of assets or stock or otherwise) and any other
corporation or entity of which Executive may serve as a director, officer or
employee at the request of Company or any successor of Company.

                  9.3      Reasonableness of Restrictions. Executive represents
and agrees that the restrictions on competition, as to time, geographic area,
and scope of activity, required by this Section 9 are reasonable, do not impose
a greater restraint than is necessary to protect the goodwill and business
interests of Company, and are not unduly burdensome to Executive. Executive
expressly acknowledges that Company competes on an international basis and that
the geographical scope of these limitations is reasonable and necessary for the
protection of Company's trade secrets and other confidential and proprietary
information. Executive further agrees that these restrictions allow Executive an
adequate number and variety of employment alternatives, based on Executive's
varied skills and abilities. Executive represents that Executive is willing and
able to compete in other employment not prohibited by this Agreement.

                  9.4      Reformation if Necessary. In the event a court of
competent jurisdiction determines that the geographic area, duration, or scope
of activity of any restriction under this Section 9 and its subsections is
unenforceable, the restrictions under this section and its subsections shall not
be terminated but shall be reformed and modified to the extent required to
render them valid and enforceable. Executive further agrees that the court may
reform this Agreement to extend the Covenant Period by an amount of time equal
to any period in which Executive is in breach of this covenant.

         10.      Confidentiality and Proprietary Rights. Executive agrees to
read, sign and abide by Company's Employee Innovations and Proprietary Rights
Assignment Agreement, which was previously executed by Executive and
incorporated herein by reference.

         11.      Nonsolicitation.

                  11.1     Nonsolicitation of Customers or Prospects. Executive
acknowledges that information about Company's customers is confidential and
constitutes trade secrets. Accordingly, Executive agrees that during the term of
this Agreement and for a period of nine (9) months after the termination of this
Agreement, Executive will not, either directly or indirectly, separately or in
association with others, interfere with, impair, disrupt or damage Company's
relationship with any of its customers or customer prospects by soliciting or

                                       7


encouraging others to solicit any of them for the purpose of diverting or taking
away business from Company.

                  11.2     Nonsolicitation of Company's Employees. Executive
agrees that during the term of this Agreement and for a period of nine (9)
months after the termination of this Agreement, Executive will not, either
directly or indirectly, separately or in association with others, interfere
with, impair, disrupt or damage Company's business by soliciting, encouraging,
hiring or attempting to hire any of Company's employees or causing others to
solicit or encourage any of Company's employees to discontinue their employment
with Company.

         12.      Injunctive Relief. Executive acknowledges that Executive's
breach of the covenants contained in Sections 9-11 (collectively "COVENANTS")
would cause irreparable injury to Company and agrees that in the event of any
such breach, Company shall be entitled to seek temporary, preliminary and
permanent injunctive relief without the necessity of proving actual damages or
posting any bond or other security.

         13.      Agreement to Arbitrate. To the fullest extent permitted by
law, Executive and Company agree to arbitrate any controversy, claim or dispute
between them arising out of or in any way related to this Agreement, the
employment relationship between Company and Executive and any disputes upon
termination of employment, including but not limited to breach of contract,
tort, discrimination, harassment, wrongful termination, demotion, discipline,
failure to accommodate, family and medical leave, compensation or benefits
claims, constitutional claims; and any claims for violation of any local, state
or federal law, statute, regulation or ordinance or common law. Claims for
breach of Company's Employee Innovations and Proprietary Rights Agreement,
workers' compensation, unemployment insurance benefits and Company's right to
obtain injunctive relief pursuant to Section 12 above are excluded. For the
purpose of this agreement to arbitrate, references to "Company" include all
parent, subsidiary or related entities and their employees, supervisors,
officers, directors, agents, pension or benefit plans, pension or benefit plan
sponsors, fiduciaries, administrators, affiliates and all successors and assigns
of any of them, and this Agreement shall apply to them to the extent Executive's
claims arise out of or relate to their actions on behalf of Company.

                  13.1     Initiation of Arbitration. Either party may exercise
the right to arbitrate by providing the other party with written notice of any
and all claims forming the basis of such right in sufficient detail to inform
the other party of the substance of such claims. In no event shall the request
for arbitration be made after the date when institution of legal or equitable
proceedings based on such claims would be barred by the applicable statute of
limitations.

                  13.2     Arbitration Procedure. The arbitration will be
conducted in Maricopa county, Arizona, by a single neutral arbitrator and in
accordance with the then current rules for resolution of employment disputes of
the American Arbitration Association ("AAA"). The parties are entitled to
representation by an attorney or other representative of their choosing. The
arbitrator shall have the power to enter any award that could be entered by a
judge of the trial court of the State of Arizona, and only such power, and shall
follow the law. The parties agree to abide by and perform any award rendered by
the arbitrator. Judgment on the award may be entered in any court having
jurisdiction thereof.

                  13.3     Costs of Arbitration. Each party shall bear one half
the cost of the arbitration filing and hearing fees, and the cost of the
arbitrator.

                                       8


         14.      General Provisions.

                  14.1     Successors and Assigns. The rights and obligations of
Company under this Agreement shall inure to the benefit of and shall be binding
upon the successors and assigns of Company. Executive shall not be entitled to
assign any of Executive's rights or obligations under this Agreement.

                  14.2     Waiver. Either party's failure to enforce any
provision of this Agreement shall not in any way be construed as a waiver of any
such provision, or prevent that party thereafter from enforcing each and every
other provision of this Agreement.

                  14.3     Attorneys' Fees. Each side will bear its own
attorneys' fees in any dispute unless a statutory section at issue, if any,
authorizes the award of attorneys' fees to the prevailing party.

                  14.4     Severability. In the event any provision of this
Agreement is found to be unenforceable by an arbitrator or court of competent
jurisdiction, such provision shall be deemed modified to the extent necessary to
allow enforceability of the provision as so limited, it being intended that the
parties shall receive the benefit contemplated herein to the fullest extent
permitted by law. If a deemed modification is not satisfactory in the judgment
of such arbitrator or court, the unenforceable provision shall be deemed
deleted, and the validity and enforceability of the remaining provisions shall
not be affected thereby.

                  14.5     Interpretation; Construction. The headings set forth
in this Agreement are for convenience only and shall not be used in interpreting
this Agreement. This Agreement has been drafted by legal counsel representing
Company, but Executive has participated in the negotiation of its terms.
Furthermore, Executive acknowledges that Executive has had an opportunity to
review and revise the Agreement and have it reviewed by legal counsel, if
desired, and, therefore, the normal rule of construction to the effect that any
ambiguities are to be resolved against the drafting party shall not be employed
in the interpretation of this Agreement.

                  14.6     Governing Law. This Agreement will be governed by and
construed in accordance with the laws of the United States and the State of
Arizona. Each party consents to the jurisdiction and venue of the state or
federal courts in Maricopa county, Arizona, if applicable, in any action, suit,
or proceeding arising out of or relating to this Agreement.

                  14.7     Notices. Any notice required or permitted by this
Agreement shall be in writing and shall be delivered as follows with notice
deemed given as indicated: (a) by personal delivery when delivered personally;
(b) by overnight courier upon written verification of receipt; (c) by telecopy
or facsimile transmission upon acknowledgment of receipt of electronic
transmission; or (d) by certified or registered mail, return receipt requested,
upon verification of receipt. Notice shall be sent to the addresses set forth
below, or such other address as either party may specify in writing.

                  14.8     Survival. Sections 8 ("No Conflict of Interest"), 9
("Post-Termination Non-Competition"), 10 ("Confidentiality and Proprietary
Rights"), 11 ("Nonsolicitation"), 12 ("Injunctive Relief"), 13 ("Agreement to
Arbitrate"), 14 ("General Provisions") and 15 ("Entire Agreement") of this
Agreement shall survive Executive's employment by Company.

                                       9


         15.      Entire Agreement. This Agreement, including Company Employee
Innovations and Proprietary Rights Assignment Agreement incorporated herein by
reference and the Form Option Agreement, constitutes the entire agreement
between the parties relating to this subject matter and supersedes all prior or
simultaneous representations, discussions, negotiations, and agreements, whether
written or oral. This Agreement may be amended or modified only with the written
consent of Executive and the Board of Company. No oral waiver, amendment or
modification will be effective under any circumstances whatsoever.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

                                       10


THE PARTIES TO THIS AGREEMENT HAVE READ THE FOREGOING AGREEMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AGREEMENT ON THE DATES SHOWN BELOW.

                                         EXECUTIVE

Dated: 1-22-03                           /s/ Hamish N. Brewer
                                         --------------------------------------
                                         HAMISH N. BREWER

                                         10839 E. Gold Dust Ave,
                                         Scottsdale, AZ 85259 USA

                                         COMPANY

Dated: 1-22-03                           By: /s/ James D. Armstrong
                                             ----------------------------------
                                             JAMES D. ARMSTRONG, CEO

                 [SIGNATURE PAGE TO BREWER EMPLOYMENT AGREEMENT]



                                    EXHIBIT A

                            Form of Option Agreement

See attached.



                                    EXHIBIT B

                             Form of Mutual Release

                                 See attached.


                            JDA SOFTWARE GROUP, INC.

                AMENDMENT NO. 1 TO EXECUTIVE EMPLOYMENT AGREEMENT
                               OF HAMISH N. BREWER

         This Amendment No. 1 (this "AMENDMENT") to Hamish N. Brewer's Executive
Employment Agreement entered into on January 22, 2003 (the "ORIGINAL EMPLOYMENT
AGREEMENT") is effective as of August 1, 2003, by and between JDA Software
Group, Inc. (the "COMPANY") and Hamish N. Brewer (the "EXECUTIVE").

                                    RECITALS

         WHEREAS, on January 22, 2003, Executive and the Company entered into
the Original Employment Agreement.

         WHEREAS, effective August 1, 2003, Executive was promoted to the office
of Chief Executive Officer ("CEO") of the Company.

         WHEREAS, Section 15 of the Original Employment Agreement vests
Executive and the Company's Board of Directors (the "BOARD") with the power to,
among other things, amend the Original Employment Agreement.

         WHEREAS, the Board approved this Amendment effective as of the date
hereof.

         WHEREAS, Executive and the Company desire to amend the Original
Employment Agreement in accordance with Section 15 thereof as hereafter set
forth.

                 AMENDMENT TO THE ORIGINAL EMPLOYMENT AGREEMENT

         NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

         1.       The first recital of the Original Employment Agreement is
hereby amended and restated to read in its entirety as follows:

                  WHEREAS, the Company desires to retain the services of
         Executive as President and Chief Executive Officer.

         2.       Section 2.1 of the Original Employment Agreement is hereby
amended and restated to read in its entirety as follows:

                  2.1      Position. Executive is employed as President and CEO
         of the Company. Executive shall perform faithfully and diligently all
         duties assigned to Executive. The Board of Directors of Company
         ("BOARD") reserves the right to modify Executive's position and duties
         at any time in its sole and absolute



         discretion, provided that the duties assigned are consistent with the
         position of President and CEO.

         3.       Section 2.2 of the Original Employment Agreement is hereby
amended and restated to read in its entirety as follows:

                  2.2      Standard of Conduct/Full-time. During the term of
         this Agreement, Executive will act loyally and in good faith to
         discharge the duties of President and CEO, and will abide by all
         policies and decisions made by Company, as well as all applicable
         federal, state and local laws, regulations or ordinances. Executive
         will act solely on behalf of Company at all times. Executive shall
         devote Executive's full business time and efforts to the performance of
         Executive's assigned duties for Company, unless Executive notifies the
         Board in advance of Executive's intent to engage in other paid work and
         receives the Board's express written consent to do so.

         4.       Section 4.1 of the Original Employment Agreement is hereby
amended and restated to read in its entirety as follows:

                  4.1      Base Salary. As compensation for Executive's
         performance of Executive's duties hereunder, Company shall pay to
         Executive a salary of $350,000 per year, payable in equal bi-monthly
         installments and in accordance with the normal payroll practices of
         Company, less required deductions for state and federal withholding
         tax, social security and all other employment taxes and authorized
         payroll deductions.

         5.       Miscellaneous.

                  (a)      Except as expressly amended as provided above, the
Original Employment Agreement remains unmodified and in full force and effect
and is hereby renewed, ratified and affirmed by the Company and Executive.

                  (b)      This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original. Any party may execute
this Amendment by facsimile signature, which shall be deemed to constitute an
original for all purposes.

            [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]

                                      -2-



THE PARTIES TO THIS AMENDMENT HAVE READ THE FOREGOING AMENDMENT AND FULLY
UNDERSTAND EACH AND EVERY PROVISION CONTAINED HEREIN. WHEREFORE, THE PARTIES
HAVE EXECUTED THIS AMENDMENT ON THE DATE(S) SHOWN BELOW.

                                             EXECUTIVE

Dated: 8-1-03                                /s/  Hamish N. Brewer
                                             -----------------------------------
                                             HAMISH N. BREWER

                                             Address____________________________

                                             ___________________________________

                                             ___________________________________

                                             COMPANY

                                             JDA SOFTWARE GROUP, INC.

Dated: 8-1-03                                By: /s/ Kristen L. Magnuson
                                                 -------------------------------
                                             Name: KRISTEN L. MAGNUSON
                                             Title: EXEC. V.P. & CFO

     [SIGNATURE PAGE TO AMENDMENT NO. 1 TO EXECUTIVE EMPLOYMENT AGREEMENT OF
                                HAMISH N. BREWER]

EX-10.8

                                                                    EXHIBIT 10.8

                            JDA SOFTWARE GROUP, INC.

                       1998 NONSTATUTORY STOCK OPTION PLAN
                         (AS AMENDED ON MARCH 28, 2003)

         1.       ESTABLISHMENT, PURPOSE AND TERM OF PLAN.

                  1.1      ESTABLISHMENT. The JDA Software Group, Inc. 1998
Nonstatutory Stock Option Plan is hereby established effective as of January 27,
1998.

                  1.2      PURPOSE. The purpose of the Plan is to advance the
interests of the Participating Company Group and its stockholders by providing
an incentive to attract, retain and reward persons performing services for the
Participating Company Group and by motivating such persons to contribute to the
growth and profitability of the Participating Company Group.

                  1.3      TERM OF PLAN. The Plan shall continue in effect until
the earlier of its termination by the Board or the date on which all of the
shares of Stock available for issuance under the Plan have been issued and all
restrictions on such shares under the terms of the Plan and the agreements
evidencing Options granted under the Plan have lapsed.

         2.       DEFINITIONS AND CONSTRUCTION.

                  2.1      DEFINITIONS. Whenever used herein, the following
terms shall have their respective meanings set forth below:

                           (a)      "BOARD" means the Board of Directors of the
Company. If one or more Committees have been appointed by the Board to
administer the Plan, "Board" also means such Committee(s).

                           (b)      "CODE" means the Internal Revenue Code of
1986, as amended, and any applicable regulations promulgated thereunder.

                           (c)      "COMMITTEE" means the Compensation Committee
or other committee of the Board duly appointed to administer the Plan and having
such powers as shall be specified by the Board. Unless the powers of the
Committee have been specifically limited, the Committee shall have all of the
powers of the Board granted herein, including, without limitation, the power to
amend or terminate the Plan at any time, subject to the terms of the Plan and
any applicable limitations imposed by law.

                           (d)      "COMPANY" means JDA Software Group, Inc., a
Delaware corporation, or any successor corporation thereto.

                                       1


                           (e)      "CONSULTANT" means any person, including an
advisor, engaged by a Participating Company to render services other than as an
Employee or a Director.

                           (f)      "DIRECTOR" means a member of the Board or of
the board of directors of any other Participating Company.

                           (g)      "EMPLOYEE" means any person treated as an
employee (including an Officer or a Director who is also treated as an employee)
in the records of a Participating Company; provided, however, that neither
service as a Director nor payment of a director's fee shall be sufficient to
constitute employment for purposes of the Plan.

                           (h)      "FAIR MARKET VALUE" means, as of any date,
the value of a share of stock or other property as determined by the Board, in
its sole discretion, or by the Company, in its sole discretion, if such
determination is expressly allocated to the Company herein.

                           (i)      "OFFICER" means any person designated by the
Board as an officer of the Company.

                           (j)      "OPTION" means a right to purchase Stock
(subject to adjustment as provided in Section 4.2) pursuant to the terms and
conditions of the Plan. Options are intended to be nonstatutory stock options
and shall not be treated as incentive stock options within the meaning of
Section 422(b) of the Code.

                           (k)      "OPTION AGREEMENT" means a written agreement
between the Company and an Optionee setting forth the terms, conditions and
restrictions of the Option granted to the Optionee and any shares acquired upon
the exercise thereof.

                           (l)      "OPTIONEE" means a person who has been
granted one or more Options.

                           (m)      "PARENT CORPORATION" means any present or
future "parent corporation" of the Company, as defined in Section 424(e) of the
Code.

                           (n)      "PARTICIPATING COMPANY" means the Company or
any Parent Corporation or Subsidiary Corporation.

                           (o)      "PARTICIPATING COMPANY GROUP" means, at any
point in time, all corporations collectively which are then Participating
Companies.

                           (p)      "STOCK" means the common stock, par value
$0.01, of the Company, as adjusted from time to time in accordance with Section
4.2.

                           (q)      "SUBSIDIARY CORPORATION" means any present
or future "subsidiary corporation" of the Company, as defined in Section 424(f)
of the Code.

                                       2


                  2.2      CONSTRUCTION. Captions and titles contained herein
are for convenience only and shall not affect the meaning or interpretation of
any provision of the Plan. Except when otherwise indicated by the context, the
singular shall include the plural, the plural shall include the singular, and
the term "or" shall include the conjunctive as well as the disjunctive.

         3.       ADMINISTRATION.

                  3.1      ADMINISTRATION BY THE BOARD. The Plan shall be
administered by the Board, including any duly appointed Committee of the Board.
All questions of interpretation of the Plan or of any Option shall be determined
by the Board, and such determinations shall be final and binding upon all
persons having an interest in the Plan or such Option. Any Officer of a
Participating Company shall have the authority to act on behalf of the Company
with respect to any matter, right, obligation, determination or election which
is the responsibility of or which is allocated to the Company herein, provided
the Officer has apparent authority with respect to such matter, right,
obligation, determination or election.

                  3.2      POWERS OF THE BOARD. In addition to any other powers
set forth in the Plan and subject to the provisions of the Plan, the Board shall
have the full and final power and authority, in its sole discretion:

                           (a)      to determine the persons to whom, and the
time or times at which, Options shall be granted and the number of shares of
Stock to be subject to each Option;

                           (b)      to determine the Fair Market Value of shares
of Stock or other property;

                           (c)      to determine the terms, conditions and
restrictions applicable to each Option (which need not be identical) and any
shares acquired upon the exercise thereof, including, without limitation, (i)
the exercise price of the Option, (ii) the method of payment for shares
purchased upon the exercise of the Option, (iii) the method for satisfaction of
any tax withholding obligation arising in connection with the Option or such
shares, including by the withholding or delivery of shares of stock, (iv) the
timing, terms and conditions of the exercisability of the Option or the vesting
of any shares acquired upon the exercise thereof, (v) the time of the expiration
of the Option, (vi) the effect of the Optionee's termination of employment or
service with the Participating Company Group on any of the foregoing, and (vii)
all other terms, conditions and restrictions applicable to the Option or such
shares not inconsistent with the terms of the Plan;

                           (d)      to approve one or more forms of Option
Agreement;

                           (e)      to amend, modify, extend, or renew, or grant
a new Option in substitution for, any Option or to waive any restrictions or
conditions applicable to any Option or any shares acquired upon the exercise
thereof;

                           (f)      to accelerate, continue, extend or defer the
exercisability of any Option or the vesting of any shares acquired upon the
exercise thereof, including with respect to

                                       3


the period following an Optionee's termination of employment or service with the
Participating Company Group;

                           (g)      to prescribe, amend or rescind rules,
guidelines and policies relating to the Plan, or to adopt supplements to, or
alternative versions of, the Plan, including, without limitation, as the Board
deems necessary or desirable to comply with the laws of, or to accommodate the
tax policy or custom of, foreign jurisdictions whose citizens may be granted
Options; and

                           (h)      to correct any defect, supply any omission
or reconcile any inconsistency in the Plan or any Option Agreement and to make
all other determinations and take such other actions with respect to the Plan or
any Option as the Board may deem advisable to the extent consistent with the
Plan and applicable law.

         4.       SHARES SUBJECT TO PLAN.

                  4.1      MAXIMUM NUMBER OF SHARES ISSUABLE. Subject to
adjustment as provided in Section 4.2, the maximum aggregate number of shares of
Stock that may be issued under the Plan shall be Four Hundred Twelve Thousand
Five Hundred (412,500) and shall consist of authorized but unissued or
reacquired shares of Stock or any combination thereof. If an outstanding Option
for any reason expires or is terminated or canceled or shares of Stock acquired,
subject to repurchase, upon the exercise of an Option are repurchased by the
Company, the shares of Stock allocable to the unexercised portion of such
Option, or such repurchased shares of Stock, shall again be available for
issuance under the Plan.

                  4.2      ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. In the
event of any stock dividend, stock split, reverse stock split, recapitalization,
combination, reclassification or similar change in the capital structure of the
Company, appropriate adjustments shall be made in the number and class of shares
subject to the Plan and to any outstanding Options, and in the exercise price
per share of any outstanding Options. If a majority of the shares which are of
the same class as the shares that are subject to outstanding Options are
exchanged for, converted into, or otherwise become (whether or not pursuant to
an Ownership Change Event, as defined in Section 8.1) shares of another
corporation (the "NEW SHARES"), the Board may unilaterally amend the outstanding
Options to provide that such Options are exercisable for New Shares. In the
event of any such amendment, the number of shares subject to, and the exercise
price per share of, the outstanding Options shall be adjusted in a fair and
equitable manner as determined by the Board, in its sole discretion.
Notwithstanding the foregoing, any fractional share resulting from an adjustment
pursuant to this Section 4.2 shall be rounded up or down to the nearest whole
number, as determined by the Board, and in no event may the exercise price of
any Option be decreased to an amount less than the par value, if any, of the
stock subject to the Option. The adjustments determined by the Board pursuant to
this Section 4.2 shall be final, binding and conclusive.

                                       4


         5.       ELIGIBILITY.

                  5.1      ELIGIBILITY AND OPTION LIMITATIONS. Options may be
granted to Employees, Consultants and Directors. For purposes of the foregoing
sentence, "Employees," "Consultants" and "Directors" shall include prospective
Employees, Consultants and Directors to whom Options are granted in connection
with written offers of engagement with the Participating Company Group. Eligible
persons may be granted more than one (1) Option.

                  5.2      RESTRICTIONS ON ELIGIBILITY. Notwithstanding the
foregoing, the maximum aggregate number of shares issued pursuant to Options
granted to Officers and Directors cannot exceed forty percent (40%) of the
aggregate number of shares reserved for issuance under the Plan as determined at
the time of each issuance to an Officer or Director.

         6.       TERMS AND CONDITIONS OF OPTIONS. Options shall be evidenced by
Option Agreements specifying the number of shares of Stock covered thereby, in
such form as the Board shall from time to time establish. Option Agreements may
incorporate all or any of the terms of the Plan by reference and shall comply
with and be subject to the following terms and conditions:

                  6.1      EXERCISE PRICE. The exercise price for each Option
shall be established in the sole discretion of the Board; provided, however,
that the exercise price per share for an Option shall be not less than the Fair
Market Value of a share of Stock on the effective date of grant of the Option.
Notwithstanding the foregoing, an Option may be granted with an exercise price
lower than the minimum exercise price set forth above if such Option is granted
pursuant to an assumption or substitution for another option in a manner
qualifying under the provisions of Section 424(a) of the Code.

                  6.2      EXERCISE PERIOD. Options shall be exercisable at such
time or times, or upon such event or events, and subject to such terms,
conditions, performance criteria, and restrictions as shall be determined by the
Board and set forth in the Option Agreement evidencing such Option; provided,
however, that no Option granted to a prospective Employee or prospective
Consultant may become exercisable prior to the date on which such person
commences service with a Participating Company.

                  6.3      PAYMENT OF EXERCISE PRICE.

                           (a)      FORMS OF CONSIDERATION AUTHORIZED. Except as
otherwise provided below, payment of the exercise price for the number of shares
of Stock being purchased pursuant to any Option shall be made (i) in cash, by
check, or cash equivalent, (ii) by tender to the Company of shares of Stock
owned by the Optionee having a Fair Market Value (as determined by the Company
without regard to any restrictions on transferability applicable to such stock
by reason of federal or state securities laws or agreements with an underwriter
for the Company) not less than the exercise price, (iii) by the assignment of
the proceeds of a sale or loan with respect to some or all of the shares being
acquired upon the exercise of the Option (including, without limitation, through
an exercise complying with the provisions of Regulation T as promulgated from
time to time by the Board of Governors of the Federal Reserve System) (a
"CASHLESS EXERCISE"), (iv) by the Optionee's promissory note in a form

                                       5


approved by the Company, (v) by such other consideration as may be approved by
the Board from time to time to the extent permitted by applicable law, or (vi)
by any combination thereof. The Board may at any time or from time to time, by
adoption of or by amendment to the standard forms of Option Agreement described
in Section 7, or by other means, grant Options which do not permit all of the
foregoing forms of consideration to be used in payment of the exercise price or
which otherwise restrict one or more forms of consideration.

                           (b)      TENDER OF STOCK. Notwithstanding the
foregoing, an Option may not be exercised by tender to the Company of shares of
Stock to the extent such tender of Stock would constitute a violation of the
provisions of any law, regulation or agreement restricting the redemption of the
Company's stock. Unless otherwise provided by the Board, an Option may not be
exercised by tender to the Company of shares of Stock unless such shares either
have been owned by the Optionee for more than six (6) months or were not
acquired, directly or indirectly, from the Company.

                           (c)      CASHLESS EXERCISE. The Company reserves, at
any and all times, the right, in the Company's sole and absolute discretion, to
establish, decline to approve or terminate any program or procedures for the
exercise of Options by means of a Cashless Exercise.

                           (d)      PAYMENT BY PROMISSORY NOTE. No promissory
note shall be permitted if the exercise of an Option using a promissory note
would be a violation of any law. Any permitted promissory note shall be on such
terms as the Board shall determine at the time the Option is granted. The Board
shall have the authority to permit or require the Optionee to secure any
promissory note used to exercise an Option with the shares of Stock acquired
upon the exercise of the Option or with other collateral acceptable to the
Company. Unless otherwise provided by the Board, if the Company at any time is
subject to the regulations promulgated by the Board of Governors of the Federal
Reserve System or any other governmental entity affecting the extension of
credit in connection with the Company's securities, any promissory note shall
comply with such applicable regulations, and the Optionee shall pay the unpaid
principal and accrued interest, if any, to the extent necessary to comply with
such applicable regulations.

                  6.4      TAX WITHHOLDING. The Company shall have the right,
but not the obligation, to deduct from the shares of Stock issuable upon the
exercise of an Option, or to accept from the Optionee the tender of, a number of
whole shares of Stock having a Fair Market Value, as determined by the Company,
equal to all or any part of the federal, state, local and foreign taxes, if any,
required by law to be withheld by the Participating Company Group with respect
to such Option or the shares acquired upon the exercise thereof. Alternatively
or in addition, in its sole discretion, the Company shall have the right to
require the Optionee, through payroll withholding, cash payment or otherwise,
including by means of a Cashless Exercise, to make adequate provision for any
such tax withholding obligations of the Participating Company Group arising in
connection with the Option or the shares acquired upon the exercise thereof. The
Company shall have no obligation to deliver shares of Stock or to release shares
of Stock from an escrow established pursuant to the Option Agreement until the
Participating Company Group's tax withholding obligations have been satisfied by
the Optionee.

                                       6


         7.       STANDARD FORM OF OPTION AGREEMENT.

                  7.1      GENERAL. Unless otherwise provided by the Board at
the time the Option is granted, an Option shall comply with and be subject to
the terms and conditions set forth in the form of Nonstatutory Stock Option
Agreement adopted by the Board concurrently with its adoption of the Plan and as
amended from time to time.

                  7.1      STANDARD TERM OF OPTIONS. Except as otherwise
provided by the Board in the grant of an Option, any Option granted hereunder
shall have a term of ten (10) years from the effective date of grant of the
Option.

                  7.3      AUTHORITY TO VARY TERMS. The Board shall have the
authority from time to time to vary the terms of any standard form of Option
Agreement described in this Section 7 either in connection with the grant or
amendment of an individual Option or in connection with the authorization of a
new standard form or forms; provided, however, that the terms and conditions of
any such new, revised or amended standard form or forms of Option Agreement are
not inconsistent with the terms of the Plan.

         8.       TRANSFER OF CONTROL.

                  8.1      DEFINITIONS.

                           (a)      An "OWNERSHIP CHANGE EVENT" shall be deemed
to have occurred if any of the following occurs with respect to the Company:

                                    (i)      the direct or indirect sale or
exchange in a single or series of related transactions by the stockholders of
the Company of more than fifty percent (50%) of the voting stock of the Company;

                                    (ii)     a merger or consolidation in which
the Company is a party;

                                    (iii)    the sale, exchange, or transfer of
all or substantially all of the assets of the Company; or

                                    (iv)     a liquidation or dissolution of the
Company.

                           (b)      A "TRANSFER OF CONTROL" shall mean an
Ownership Change Event or a series of related Ownership Change Events
(collectively, the "TRANSACTION") wherein the stockholders of the Company
immediately before the Transaction do not retain immediately after the
Transaction, in substantially the same proportions as their ownership of shares
of the Company's voting stock immediately before the Transaction, direct or
indirect beneficial ownership of more than fifty percent (50%) of the total
combined voting power of the outstanding voting stock of the Company or the
corporation or corporations to which the assets of the Company were transferred
(the "TRANSFEREE CORPORATION(S)"), as the case may be. For purposes of the
preceding sentence, indirect beneficial ownership shall include, without
limitation, an interest resulting from ownership of the voting stock of one or
more corporations

                                       7


which, as a result of the Transaction, own the Company or the Transferee
Corporation(s), as the case may be, either directly or through one or more
subsidiary corporations. The Board shall have the right to determine whether
multiple sales or exchanges of the voting stock of the Company or multiple
Ownership Change Events are related, and its determination shall be final,
binding and conclusive.

                  8.2      EFFECT OF TRANSFER OF CONTROL ON OPTIONS. In the
event of a Transfer of Control, the surviving, continuing, successor, or
purchasing corporation or parent corporation thereof, as the case may be (the
"ACQUIRING CORPORATION"), may either assume the Company's rights and obligations
under outstanding Options or substitute for outstanding Options substantially
equivalent options for the Acquiring Corporation's stock. Any Options which are
neither assumed or substituted for by the Acquiring Corporation in connection
with the Transfer of Control nor exercised as of the date of the Transfer of
Control shall terminate and cease to be outstanding effective as of the date of
the Transfer of Control. Notwithstanding the foregoing, shares acquired upon
exercise of an Option prior to the Transfer of Control and any consideration
received pursuant to the Transfer of Control with respect to such shares shall
continue to be subject to all applicable provisions of the Option Agreement
evidencing such Option except as otherwise provided in such Option Agreement.
Furthermore, notwithstanding the foregoing, if the corporation the stock of
which is subject to the outstanding Options immediately prior to an Ownership
Change Event described in Section 8.1(a)(i) constituting a Transfer of Control
is the surviving or continuing corporation and immediately after such Ownership
Change Event less than fifty percent (50%) of the total combined voting power of
its voting stock is held by another corporation or by other corporations that
are members of an affiliated group within the meaning of Section 1504(a) of the
Code without regard to the provisions of Section 1504(b) of the Code, the
outstanding Options shall not terminate unless the Board otherwise provides in
its sole discretion.

         9.       PROVISION OF INFORMATION. Each Optionee shall be given access
to information concerning the Company equivalent to that information generally
made available to the Company's common stockholders.

         10.      NONTRANSFERABILITY OF OPTIONS. During the lifetime of the
Optionee, an Option shall be exercisable only by the Optionee or the Optionee's
guardian or legal representative. No Option shall be assignable or transferable
by the Optionee, except by will or by the laws of descent and distribution.

         11.      INDEMNIFICATION. In addition to such other rights of
indemnification as they may have as members of the Board or Officers or
employees of the Participating Company Group, members of the Board and any
Officers or employees of the Participating Company Group to whom authority to
act for the Board is delegated shall be indemnified by the Company against all
reasonable expenses, including attorneys' fees, actually and necessarily
incurred in connection with the defense of any action, suit or proceeding, or in
connection with any appeal therein, to which they or any of them may be a party
by reason of any action taken or failure to act under or in connection with the
Plan, or any right granted hereunder, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment
in any such action, suit or

                                       8


proceeding, except in relation to matters as to which it shall be adjudged in
such action, suit or proceeding that such person is liable for gross negligence,
bad faith or intentional misconduct in duties; provided, however, that within
sixty (60) days after the institution of such action, suit or proceeding, such
person shall offer to the Company, in writing, the opportunity at its own
expense to handle and defend the same.

         12.      TERMINATION OR AMENDMENT OF PLAN. The Board may terminate or
amend the Plan at any time. However, no termination or amendment of the Plan may
adversely affect any then outstanding Option or any unexercised portion thereof,
without the consent of the Optionee, unless such termination or amendment is
necessary to comply with any applicable law or government regulation.

         IN WITNESS WHEREOF, the undersigned Secretary of the Company certifies
that the foregoing JDA Software Group, Inc. 1998 Nonstatutory Stock Option Plan
was duly adopted by the Board on January 27, 1998.

                                         _______________________________________
                                         Secretary

                                       9


                                  PLAN HISTORY
                        
January 27, 1998           Board adopts Plan, with an initial reserve of 125,000 shares.

July 20, 1998              Company effects a 3:2 stock split, resulting in an adjusted share
                           reserve of 187,500 shares.

April 4, 2000              Board adopts resolution to increase reserved shares under the Plan
                           by 225,00; from 187,500 to 412,500.

March 28, 2003             Board amends Plan to comply with "broadly-based" exception to
                           Nasdaq Stock Market Marketplace Rule 4350(i)(1)(A).



                                       10

EX-10.13

                                                                   EXHIBIT 10.13

                               PURCHASE AGREEMENT

         THIS PURCHASE AGREEMENT ("Agreement") is made as of February 5, 2004,
by and between OPUS REAL ESTATE ARIZONA II, L.L.C., a Delaware limited liability
company ("Seller") and JDA SOFTWARE GROUP, INC., a Delaware corporation
("Purchaser").

         In consideration of this Agreement, Seller and Purchaser agree as
follows:

         1.       SALE OF SUBJECT PROPERTY. Seller agrees to sell to Purchaser,
and Purchaser agrees to buy from Seller, all of Seller's right, title and
interest in and to the following property (collectively, "Subject Property"):

                  (a)      REAL PROPERTY. Fee simple interest in that certain
         parcel of real estate legally described on Exhibit A attached hereto
         and made a part hereof (the "Land"); together with (i) all building
         structures, improvements and fixtures owned by Seller located on the
         Land, (the "Improvements"); and (ii) all rights, privileges, servitudes
         and appurtenances thereunto belonging or appertaining (the "Real
         Property").

                  (b)      PERSONAL PROPERTY AND INTANGIBLES. All of the
         equipment and personal property owned by Seller and used in the
         operation of the Real Property, if any, and made a part hereof and the
         right to use the name "IDA Corporate Center" and other business or
         trade names associated with the Subject Property (excluding, any name
         containing the name "Opus"), to the extent the same are assignable
         (collectively, "Personal Property").

                  (c)      LEASES. Seller's interest as landlord in and to the
         leases described on Exhibit B attached hereto and made a part hereof,
         together with all amendments or modifications thereto (collectively,
         "Leases," herein the Lease described on Exhibit B with JDA Software
         Group, Inc. will be referred to as the "JDA Lease" and the Lease
         described on Exhibit B with Trapeze Software, Inc. will be referred to
         as the "Trapeze Lease"). The McLeod Lease (as defined in Section 26
         hereof) will terminate on January 31, 2004 pursuant to the McLeod
         Termination Agreement (as defined in Section 26 hereof) and will not be
         assigned, sold or transferred to Purchaser.

                  (d)      PERMITS. Seller's interest in and to the licenses,
         permits, certificates of occupancy described on Exhibit D attached
         hereto and made a part hereof, to the extent, if any, that the same are
         in Seller's possession and are assignable (collectively, "Permits").

                  (e)      SERVICE CONTRACTS. Seller's interest in and to the
         existing service and maintenance contracts described on Exhibit E
         attached hereto and made a part hereof, together with all amendments or
         modifications thereto ("Service Contracts"), subject to this Section
         1(e). On or before the Contingency Date (defined below), Purchaser
         shall advise Seller, in writing, of any Service Contracts that
         Purchaser desires to be assigned to and assumed by Purchaser at Closing
         (as such term is defined in Section 8(a) hereof). Seller shall then
         cause any Service Contracts that Purchaser does not elect to assume
         (i.e.,



         any Service Contracts not set forth in the aforesaid written notice
         from Purchaser) to be terminated prior to Closing, provided that Seller
         has reasonably sufficient notice to allow for timely termination of
         such Service Contracts. Failure by Purchaser to notify Seller, in
         writing, prior to the Contingency Date, shall constitute an irrevocable
         election by Purchaser to have all of the Service Contracts terminated
         by Seller prior to Closing.

                  (f)      WARRANTIES. Seller's interest in and to all unexpired
         warranties and guaranties (i) given or assigned to, or benefiting,
         Seller, the Real Property or the Personal Property, (ii) regarding the
         acquisition, construction, design, use, operation, management or
         maintenance of the Real Property or the Personal Property, and (iii)
         described on Exhibit F attached hereto and made a part hereof, to the
         extent that the same are in Seller's possession and are assignable
         ("Warranties").

                  (g)      PLANS. A limited perpetual license, as hereinafter
         described, to review and use a copy of the final plans and
         specifications (excluding shop drawings) relating to the construction
         of the Improvements in Seller's or the property manager's possession
         ("Plans"); provided, however, neither Purchaser nor its successors or
         assigns may use the Plans for any purpose other than the repair,
         maintenance or restoration of the Improvements without the prior
         written consent of Seller, and Purchaser hereby agrees to indemnify,
         defend and hold harmless Seller and its affiliates from and against any
         unauthorized use of the Plans, which obligation shall survive Closing.
         Seller reserves the right to use the Plans for any purpose.

         2.       PURCHASE PRICE. Purchaser shall pay to Seller, as
consideration for the purchase of the Subject Property, the sum ("Purchase
Price") of Twenty- Three Million Eight Hundred Thirty-Six Thousand and 00/100
Dollars ($23,836,000.00). The Purchase Price shall be payable as follows:

                  (a)      INITIAL EARNEST MONEY DEPOSIT. Upon the execution of
         this Agreement by Seller and Purchaser, Purchaser shall deposit the sum
         of Two Hundred Thirty-Eight Thousand and 00/100 Dollars ($238,000.00)
         (the "Initial Earnest Money") with the escrow department of First
         American Title Insurance Company, 4801 East Washington, Suite 110,
         Phoenix, Arizona 85034 ("Title Company") pursuant to an escrow
         agreement in substantially the form of Exhibit G attached hereto and
         made a part hereof (the "Escrow Agreement").

                  (b)      ADDITIONAL EARNEST MONEY DEPOSIT. Within two (2) days
         after the Contingency Date, provided that this agreement has not been
         terminated as set forth in Section 3 hereof on or before the
         Contingency Date, Purchaser shall deposit the additional sum of One
         Million Two Hundred Sixty-Two Thousand and 00/100 Dollars
         ($1,262,000.00) (the "Additional Earnest Money") with the escrow
         department of the Title Company. Upon such deposit, the Title Company
         shall issue its written acknowledgment of receipt as required under the
         Escrow Agreement. The Initial Earnest Money and Additional Earnest
         Money and all interest earnings thereon are collectively referred to
         herein as the "Earnest Money". The Earnest Money shall be paid to
         Seller at Closing as a credit against the Purchase Price.

                                       2



                  (c)      BALANCE OF PURCHASE PRICE. The balance of the
         Purchase Price, plus or minus prorations and other adjustments, if any,
         shall be due at Closing. Purchaser shall pay such balance to Seller, or
         at the direction of Seller, by wire transfer of immediately available
         funds.

         3.       CONDITIONS PRECEDENT TO CLOSING. Purchaser's obligation to
consummate the transaction contemplated by this Agreement shall be subject to
satisfaction or waiver of each of the following conditions ("Conditions
Precedent") on or before the date which is thirty (30) days following the date
of this Agreement ("Contingency Date"):

                  (a)      TITLE/SURVEY. Within ten (10) days after the date
         hereof, Seller will furnish to Purchaser (i) a current title commitment
         ("Commitment") for an owner's title policy issued by the Title Company
         showing title in Seller (with copies of all underlying title documents
         listed in the Commitment other than any financing documents encumbering
         the Real Property), (which Commitment is in a nominal amount, but shall
         be increased to the Purchase Price at Closing), and (ii) a survey
         ("Survey") for the Real Property prepared in accordance with the
         Minimum Standard Detail Requirements for Class A Land Title Surveys
         (jointly established by ALTA/ACSM as revised in 1999) and certified to
         Purchaser, Seller and the Title Company. If the Survey discloses survey
         defects or if the Commitment shows exceptions which defects or
         exceptions are not acceptable to Purchaser (collectively, "Unpermitted
         Encumbrances"), then Purchaser shall notify Seller, in writing, on or
         before the date which is five (5) days prior to the Contingency Date,
         specifying the Unpermitted Encumbrances, and, prior to the Contingency
         Date, Purchaser shall have received assurances satisfactory to
         Purchaser, in its reasonable discretion, that the Unpermitted
         Encumbrances will be removed or endorsed over on or before Closing. Any
         matter shown on the Commitment or the Survey and not objected to by
         Purchaser in the manner provided above shall be a permitted
         encumbrance.

                  (b)      DUE DILIGENCE MATERIALS; TESTS. Upon execution of
         this Agreement Seller has delivered to Purchaser true and correct
         copies of all Leases, Permits, Service Contracts, Warranties, Plans and
         any environmental assessments and soils reports in Seller's possession
         or control with respect to the Subject Property, for Purchaser's review
         and analysis. Seller shall allow Purchaser and Purchaser's officers,
         employees, agents, attorneys, architects and engineers access to the
         Real Property, subject to the rights of the tenants under the Leases
         (collectively, "Tenants") without charge and at all reasonable times,
         for the purpose of making such inspections, tests and verifications
         (collectively, "Tests") as they shall deem reasonably necessary. On or
         before the Contingency Date, Purchaser shall be satisfied, in its sole
         and absolute discretion, with the results of the Tests. Purchaser shall
         pay all costs and expenses of the Tests and shall defend, indemnify and
         hold harmless Seller, and its agents, employees and contractors, and
         the Subject Property, from and against any and all loss, cost, damage,
         liability, settlement, cause of action or threat thereof or expense
         (including, without limitation, reasonable attorneys' fees and costs)
         arising from or relating to the Tests. Purchaser shall promptly repair
         and restore any damage to the Subject Property attributable to the
         conduct of the Tests, and shall promptly return the Subject Property to
         substantially the same condition as existed prior to the conduct of the
         Tests. No Tests shall be conducted without Seller's

                                       3



         approval as to the time and manner of such Tests, which approval shall
         not be unreasonably withheld or delayed. At Seller's sole option, any
         such Tests shall be performed in the presence of a representative of
         Seller. All Tests shall be conducted in such a manner so as to minimize
         interference with the operation of the Subject Property and the
         business of any and all Tenants and occupants thereof. Anything in this
         Agreement to the contrary notwithstanding, the indemnity, defense and
         hold harmless obligations of Purchaser under this Section 3(b) shall
         survive Closing and any termination of this Agreement.

                  (c)      BOARD APPROVAL. Purchaser shall have obtained
         approval of the Purchaser's Board of Directors to consummate the
         purchase contemplated by this Agreement.

         Purchaser shall, on or before the Contingency Date notify Seller in
writing if the Conditions Precedent have not been satisfied or waived by
Purchaser, in Purchaser's sole and absolute discretion. If Purchaser so timely
notifies Seller, then this Agreement shall terminate and Purchaser shall receive
a return of the Initial Earnest Money, provided Purchaser shall execute any
document reasonably required by Seller to evidence such termination including,
without limitation, a quit claim deed. Upon such termination, neither party will
have any further rights or obligations (other than the obligations of Purchaser
set forth in Section 3(b) and the indemnity obligations of Purchaser set forth
in Articles 14 and 15, which obligations shall survive any such termination)
regarding this Agreement or the Subject Property. If Purchaser gives notice that
the Conditions have been satisfied or waived by Purchaser, or if Purchaser fails
to notify Seller on or prior to the Contingency Date that the Conditions
Precedent have not been satisfied or waived by Purchaser, then Purchaser's
termination right set forth in this Section 3 shall be deemed to have been
waived by Purchaser, in which event (i) Purchaser shall deposit the Additional
Earnest Money with the Title Company within two (2) days after the Contingency
Date, (ii) all of the Earnest Money (including the Initial Earnest Money and the
Additional Earnest Money) shall become non-refundable as of the Contingency
Date, except as specifically provide otherwise herein, and (iii) the parties
shall proceed to Closing in accordance with the provisions herein contained.

         4.       COVENANTS BY SELLER. Seller covenants and agrees with
Purchaser that from the date hereof until the Closing Date (as such term is
defined in Section 8(a) hereof), Seller shall conduct its business involving the
Subject Property as follows (except as specifically provided to the contrary
herein):

                  (a)      TRANSFERS; EASEMENTS. Seller shall refrain from
         transferring any of the Subject Property, or creating on the Real
         Property any easements provided, however, that nothing herein shall
         preclude Seller from (i) replacing any equipment, supplies or machinery
         in the ordinary course of operating the Subject Property or (ii)
         entering into any easements or other documents required by any
         applicable governmental or quasi-governmental authority or provider of
         utility services.

                  (b)      CONTRACTS. Seller shall refrain from entering into or
         amending any contracts or other agreements regarding the Subject
         Property that would be binding on Purchaser following consummation of
         the sale contemplated by this Agreement without

                                       4



         the prior written consent of Purchaser, which consent shall not be
         unreasonably withheld or delayed and which shall be deemed given by
         Purchaser if Purchaser does not object to Seller's request for approval
         within five (5) business days. Nothwithstanding the foregoing, Seller
         may (i) enter into an amendment of the Declaration (as defined in
         Section 25 hereof) pursuant to the terms of Section 25 hereof and (ii)
         execute and record a Map of Dedication of Northsight II (the "Map of
         Dedication") in the map records of Maricopa County, Arizona. Upon the
         filing of the Map of Dedication, the legal description of the Real
         Property will be the description shown on Exhibit N attached hereto
         (the "Revised Legal Description"). Provided that the Map of Dedication
         is recorded prior to the Closing Date, the legal description to be
         conveyed pursuant to the Deed and the other Seller Closing Documents
         will be the Revised Legal Description.

                  (c)      OPERATIONS. Seller shall operate, maintain, repair
         and insure the Subject Property in a manner consistent with the
         existing operation, maintenance, repair and insurance of the Subject
         Property.

         5.       REPRESENTATIONS AND WARRANTIES BY SELLER.

                  (a)      REPRESENTATIONS AND WARRANTIES. Seller represents and
         warrants to Purchaser as follows:

                           (i)      AUTHORITY. Seller is a limited liability
                  company duly organized and validly existing and in good
                  standing under the laws of the State of Delaware and in good
                  standing under the laws of the State of Arizona. Seller has
                  the requisite power and authority to enter into and perform
                  this Agreement and Seller's Closing Documents (as such term is
                  defined in Section 9(a) hereof). This Agreement and Seller's
                  Closing Documents have been duly authorized by all necessary
                  action on the part of Seller and have been or will be duly
                  executed and delivered by Seller. Seller's execution, delivery
                  and performance of this Agreement and Seller's Closing
                  Documents will not conflict with or result in a violation of
                  Seller's organizational documents, or any judgment, order or
                  decree of any court or arbiter, to which Seller is a party.
                  This Agreement and Seller's Closing Documents are valid and
                  binding obligations of Seller, and are enforceable against
                  Seller in accordance with their terms, subject to applicable
                  bankruptcy, insolvency, reorganization, creditor's rights and
                  other similar laws.

                           (ii)     UTILITIES. Seller has received no written
                  notice of actual or threatened reduction or curtailment of any
                  utility service currently supplied to the Real Property.

                           (iii)    HAZARDOUS SUBSTANCES. Except as disclosed by
                  any environmental assessment or report delivered to or
                  received by Purchaser (including, without limitation, any
                  environmental assessments or reports delivered by Seller to
                  Purchaser), to Seller's actual knowledge, (A) the Real
                  Property has never been used for the production, storage,
                  deposit or disposal of hazardous substances in any reportable
                  quantities under and in violation of applicable environmental
                  laws; (B) no above or below ground storage tank is or has been

                                       5



                  located at the Real Property; (C) Seller has not received any
                  written notice from any applicable governmental authority that
                  any hazardous substances have been placed or located upon the
                  Real Property in violation of applicable environmental laws;
                  and (D) Seller has no knowledge of any material adverse
                  environmental condition related to the Real Property except as
                  set forth in the environmental reports in the possession or
                  control of Seller.

                           (iv)     FIRPTA. Seller is not a "foreign person,"
                  "foreign partnership," "foreign trust" or "foreign estate" as
                  those terms are defined in Section 1445 of the Internal
                  Revenue Code.

                           (v)      PROCEEDINGS. There is no action, litigation,
                  condemnation or proceeding of any kind pending or, to the best
                  knowledge of Seller, threatened against Seller, which would
                  have a material and adverse affect on the ability of Seller to
                  perform its obligations under this Agreement, or against any
                  portion of the Real Property.

                           (vi)     CONDITION OF THE REAL PROPERTY. Seller has
                  not received written notice from any governmental authority
                  having jurisdiction over the Real Property of any violation of
                  any applicable law, rule, regulation or code of any such
                  governmental authority, which has not been cured or remedied.
                  To the best of Seller's knowledge, except as disclosed by any
                  engineering report received by Purchaser with respect to the
                  Real Property, the major structural, mechanical and electrical
                  systems constituting the Improvements are in good working
                  order and condition to perform the work or function for which
                  intended. To the best of Seller's knowledge, there are no
                  material adverse physical conditions or defects in or on the
                  Improvements, except as disclosed in writing to Purchaser.
                  Seller has provided to Purchaser copies of all written
                  engineering reports in Seller's possession or control
                  regarding the condition of the Real Property.

                           (vii)    LEASES.

                           (A)      Exhibit B is a true and complete list of all
                                    of the Leases or other occupancy agreements.
                                    Except as set forth in the Leases, there are
                                    no options to expand, rights of first
                                    refusal, options to terminate without cause
                                    of Seller, options to renew, options to
                                    purchase, or any rent abatements given to
                                    any of the Tenants after the Tenants are in
                                    occupancy and paying rent.

                           (B)      To the best of Seller's knowledge, each of
                                    the Trapeze Lease and the License Agreement
                                    with Voice Stream PCS III, Corporation (the
                                    "Voice Stream License") is in full force and
                                    effect according to the terms set forth
                                    therein, and has not been modified, amended,
                                    or altered, in writing or otherwise, except
                                    as set forth in Exhibit B.

                           (C)      Seller has not received written notice from
                                    the Tenant under the Trapeze Lease or the
                                    licensee under the Voice Stream License of
                                    any unperformed obligation of the landlord
                                    under such Leases, including, without
                                    limitation, failure of the landlord to
                                    construct

                                       6



                                    any required tenant improvements. Neither of
                                    the tenants under the Trapeze Lease and the
                                    Voice Stream License has asserted in writing
                                    to Seller any offsets, defenses or claims
                                    available against rent payable by it or
                                    other performance or obligations otherwise
                                    due from it under the Trapeze Lease or the
                                    Voice Stream License, respectively. To the
                                    best of Seller's knowledge, with respect to
                                    the Trapeze Lease as of the date hereof, all
                                    tenant improvement allowances have been paid
                                    and all tenant improvements have been
                                    completed.

                           (D)      To the best of Seller's knowledge, neither
                                    the tenant under the Trapeze Lease nor the
                                    licensee under the Voice Stream License is
                                    in default under its Lease (beyond any
                                    applicable grace or cure period), and
                                    neither is in arrears in the payment of any
                                    sums or in the performance of any
                                    obligations required of it under such
                                    Trapeze Lease or Voice Stream License, as
                                    appropriate.

                           (E)      There are no brokers' commissions, finders'
                                    fees, or other charges payable or to become
                                    payable to any third party on behalf of
                                    Seller as a result of or in connection with
                                    the Trapeze Lease, including, without
                                    limitation, any unexecuted options to expand
                                    or renew, other than as set forth on Exhibit
                                    C attached hereto and made a part hereof.

                           (viii)   SPECIAL ASSESSMENTS. Except as shown on any
                  tax bills delivered to Purchaser and the Commitment, Seller
                  has not received any notice, in writing, of any special
                  assessment which affects the Subject Property.

                  (b)      SELLER'S KNOWLEDGE. For purposes of this Agreement,
         the phrase "to the best of Seller's knowledge" or words of similar
         import shall mean the actual knowledge of Scott Haugen of Opus
         Properties, L.L.C., and Patrick Mascia, Vice President of Seller,
         without independent inquiry or investigation.

                  (c)      REPRESENTATION AND WARRANTY BECOMING UNTRUE. In the
         event that, between the date of this Agreement and the Closing Date,
         Seller becomes aware that any of the foregoing representations and
         warranties of Seller is no longer true and correct, Seller shall
         promptly notify Purchaser thereof in writing. Seller covenants and
         agrees, within thirty (30) days (such thirty (30)-day period being
         sometimes hereinafter referred to as the "Warranty Cure Period"), to
         use reasonable efforts to cure any such then- incorrect representations
         and warranties, and the Closing shall be delayed in accordance with
         this Section 5(c) while Seller undertakes such efforts. If, after using
         reasonable efforts, Seller cannot effect such cure on or before the
         expiration of the Warranty Cure Period, Purchaser shall, within five
         (5) business days following expiration of the Warranty Cure Period,
         elect either (i) to terminate this Agreement (other than the
         obligations of Purchaser and Seller set forth in Sections 3(b), 14 and
         15 hereof, which obligations shall survive any such termination),
         provided Purchaser shall execute any document reasonably required by
         Seller to evidence such termination including, without

                                       7



         limitation, a quit claim deed, or (ii) to waive any such incorrect
         representations and warranties of Seller, and thereby release Seller
         from any and all liability or obligations with respect thereto, and to
         proceed hereunder. Failure of Purchaser to notify Seller within the
         aforesaid five (5)-business day period shall constitute Purchaser's
         irrevocable election under clause (ii) of the immediately preceding
         sentence. In the event that Purchaser terminates this Agreement as
         provided in clause (i) above, and provided that Purchaser is not in
         breach or default hereunder beyond any applicable grace or cure period,
         the Earnest Money shall be promptly returned to Purchaser.

         6.       REPRESENTATIONS AND WARRANTIES BY PURCHASER. Purchaser
represents and warrants to Seller that Purchaser is a corporation duly organized
and validly existing and in good standing under the laws of the State of
Delaware and in good standing under the laws of the State of Arizona; that
Purchaser has the requisite power and authority to enter into this Agreement and
the Purchaser's Closing Documents (as herein defined); such documents have been
duly authorized by all necessary action on the part of Purchaser and have been
or will be duly executed and delivered; that the execution, delivery and
performance by Purchaser of such documents will not conflict with or result in
violation of Purchaser's organizational documents or any judgment, order or
decree of any court or arbiter to which Purchaser is a party; such documents are
valid and binding obligations of Purchaser, and are enforceable against
Purchaser in accordance with their terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium, creditor's rights and other similar
laws.

         7.       OTHER MATTERS RELATED TO REPRESENTATIONS AND WARRANTIES OF
SELLER AND PURCHASER. The respective representations and warranties of Seller
and Purchaser contained in this Agreement shall survive Closing; provided,
however, that (a) any cause of action that Purchaser may have against Seller by
reason of a breach or default of any of Seller's representations and warranties
set forth herein shall automatically expire on the date which is one (1) year
after the Closing Date ("Warranty Expiration Date"), except that the same shall
not expire as to any such breach or default as to which Purchaser has instituted
litigation against Seller prior to the Warranty Expiration Date; (b) Seller's
total liability for any breach or breaches of its representations and warranties
set forth herein shall in no event exceed $7,000,000, which liability limit
shall survive closing and (c) Seller shall have no liability whatsoever to
Purchaser with respect to any breach or breaches by Seller of its
representations and warranties set forth herein, if, prior to Closing, Purchaser
obtains knowledge by virtue of its current or prior occupancy of the Subject
Property as the tenant under the JDA Lease or through a written document or
report received on or prior to the Closing Date of a fact or circumstance, the
existence of which would constitute a breach of Seller's representations and
warranties set forth herein. Among other things, for purposes hereof, Purchaser
shall be deemed to have knowledge of any fact or circumstance set forth in any
environmental assessments, engineering reports, estoppel certificates delivered
by the tenant under the Trapeze Lease, or other written materials reviewed or
received by Purchaser on or prior to the Closing Date. Seller's representations
and warranties set forth herein shall be deemed automatically modified to the
extent that any information contained in any environmental assessments or
engineering reports or other written materials reviewed or received by Purchaser
prior to the Closing Date is inconsistent with the matters which are the subject
to such representations and warranties. Notwithstanding the foregoing, Seller
shall have no liability with respect to any breach to the extent the loss
sustained by Purchaser as a result thereof does not exceed $10,000.00 in the
aggregate, provided, further if

                                       8



any such loss exceeds $10,000.00, Seller shall be liable for the total amount of
such loss subject to the maximum liability provisions herein contained. For
purposes of this Agreement, "Purchaser's knowledge" or words of similar import
shall mean the actual knowledge of Paul Mehlhorn, Vice President of Purchaser.

         8.       CLOSING.

                  (a)      CLOSING DATE. The closing of the purchase and sale
         contemplated by this Agreement ("Closing") shall occur on the date
         which is forty-five (45) days after the Contingency Date, or on such
         earlier or later date as Seller and Purchaser may mutually agree,
         subject to delays occasioned by operation of Sections 5(c) or 9(b)
         hereof ("Closing Date"). The closing shall be consummated through
         escrow as described in Section 9(e) below.

                  (b)      PURCHASER'S CLOSING CONDITIONS PRECEDENT. Purchaser's
         obligation to consummate the transaction contemplated by this Agreement
         shall be subject to satisfaction or waiver of each of the following
         conditions ("Purchaser's Closing Conditions Precedent"); provided,
         however, that Purchaser shall have the unilateral right to waive any
         Purchaser's Closing Condition Precedent, in whole or in part, by
         written notice to Seller:

                           (i)      The representations and warranties of Seller
                  set forth in Section 5(a) hereof shall be, in all material
                  respects, true and complete.

                           (ii)     Seller shall have performed all of the
                  obligations required to be performed by Seller under this
                  Agreement, as and when required by this Agreement, in all
                  material respects.

                           (iii)    Seller shall have delivered at Closing the
                  Seller's Closing Documents, the Joint Closing Documents, and a
                  "marked-up" title commitment or pro forma title policy
                  pursuant to Section 9(b) hereof.

                           (iv)     Purchaser shall have received on or before
                  the Closing Date, an estoppel certificate from the tenant
                  under the Trapeze Lease in the form attached to the Trapeze
                  Lease, or if no form is attached, then substantially in the
                  form of Exhibit I attached hereto, or otherwise approved by
                  Purchaser. No estoppel certificate shall be required for JDA
                  Software Group, Inc., as tenant, or for the tenant under the
                  McLeod Lease (as defined in Section 26).

                           (v)      Seller shall provide evidence to Purchaser
                  that the McLeod Lease (as defined in Section 26 hereof) has
                  been terminated on or before the Closing Date as provided in
                  Section 26 hereof.

                           (vi)     An amendment to the Declaration (as defined
                  in Section 25 hereof) shall have been prepared and shall be
                  executed at or prior to Closing providing that if the sale of
                  the Subject Property to the Purchaser hereunder is
                  consummated, Purchaser shall succeed to the rights,
                  obligations and duties of the

                                       9



                  Declarant under the Declaration in the event that Opus West
                  Corporation is no longer the Declarant.

                  (c)      SELLER'S CONDITIONS PRECEDENT. Seller's obligation to
         consummate the transaction contemplated by this Agreement shall be
         subject to satisfaction or waiver of each of the following conditions
         ("Seller's Closing Conditions Precedent"); provided, however, that
         Seller shall have the unilateral right to waive any Seller's Closing
         Condition Precedent, in whole or in part, by written notice to
         Purchaser:

                           (i)      The representations and warranties of
                  Purchaser set forth in Section 6 hereof shall be, in all
                  material respects, true and complete.

                           (ii)     Purchaser shall have performed all of the
                  obligations required to be performed by Purchaser under this
                  Agreement, as and when required by this Agreement, in all
                  material respects.

                           (iii)    The Tenant under the JDA Lease shall not be
                  in default under the terms of the JDA Lease, and all rents due
                  under the JDA Lease shall be paid in full through and
                  including the Closing Date.

                  (d)      FAILURE OF CONDITION PRECEDENT. In the event that
         Purchaser's Closing Conditions Precedent or Seller's Closing Conditions
         Precedent, as the case may be, have not been satisfied or waived as of
         the scheduled Closing Date as the same may be extended as permitted
         above, and provided the failure to satisfy or waive any such condition
         is not attributable to a breach or default of this Agreement by Seller
         or Purchaser, as the case may be (in which event the provisions of
         Section 11 shall apply), this Agreement shall terminate (other than the
         obligations of Purchaser and Seller set forth in Sections 3(b), 14 and
         15 hereof, which obligations shall survive any such termination), and
         the Earnest Money shall be returned to Purchaser, provided, however,
         upon such termination Purchaser shall, at the request of Seller,
         execute any document reasonably requested by Seller to evidence such
         termination, including, without limitation, a quit claim deed. Upon
         such termination, neither party will have any further rights or
         obligations (except the obligations of Purchaser under Section 3(b) and
         the obligations of Purchaser and Seller set forth in Sections 14 and 15
         hereof, which obligations shall survive any such termination).

         9.       CLOSING DELIVERIES.

                  (a)      SELLER'S CLOSING DOCUMENTS. On the Closing Date,
         Seller shall execute and/or deliver to Purchaser or cause to be
         executed and/or delivered the following (collectively, "Seller's
         Closing Documents"):

                           (i)      DEED. A Special Warranty Deed conveying the
                  Real Property to Purchaser in the form set forth in Exhibit J
                  attached hereto and made a part hereof (the "Deed").

                                       10



                           (ii)     BILL OF SALE. A Bill of Sale transferring
                  the Personal Property to Purchaser, in the form set forth in
                  Exhibit K attached hereto and made a part hereof.

                           (iii)    SELLER'S AFFIDAVIT. An Affidavit of Seller
                  in favor of the Title Company indicating that on the Closing
                  Date, to the best of Seller's knowledge, there are no
                  outstanding, unsatisfied judgments, tax liens (other than the
                  lien of real estate taxes not yet due and payable) or
                  bankruptcies against or involving Seller or the Real Property;
                  and that, to the best of Seller's knowledge, there are no
                  other unrecorded interests in the Real Property other than the
                  Leases or any other document shown on the Commitment.

                           (iv)     ORIGINAL DOCUMENTS. Original copies of the
                  Leases, the Permits, those of the Service Contracts (if any)
                  to be assigned to and assumed by Purchaser pursuant to Section
                  l(e) hereof, the Warranties and the Plans, to the extent that
                  the same are in Seller's possession and have not previously
                  been delivered to Purchaser.

                           (v)      FIRPTA AFFIDAVIT. A non-foreign affidavit
                  properly containing such information as is required by Section
                  1445(b)(2) of the Internal Revenue Code and the regulations
                  promulgated thereunder.

                           (vi)     KEYS AND MANUALS. All keys to locks on the
                  Subject Property and all manuals for equipment with respect to
                  the Subject Property in the possession or control of Seller.

                           (vii)    TITLE DOCUMENTS. Affidavits and personal
                  undertakings of Seller relating to gap coverage, mechanic's
                  liens, creditor's rights and all other documents reasonably
                  required by the Title Company to issue the Policy to
                  Purchaser.

                           (viii)   CLOSING CERTIFICATE. A Closing Certificate
                  executed by Seller certifying that representations and
                  warranties made by Seller herein are true as of the Closing
                  Date, as modified in the interim.

                           (ix)     MANAGEMENT AND LEASING AGREEMENT
                  TERMINATIONS. A termination of existing management agreements
                  and leasing brokerage agreements, if any, and those Service
                  Contracts which Purchaser requests be terminated.

                           (x)      FINANCIAL RECORDS. Financial records
                  directly related to operation of the Subject Property.

                           (xi)     TENANT ESTOPPEL CERTIFICATES. Subject to the
                  terms of Section 8(b)(iv) hereof, a tenant estoppel
                  certificate from the tenant under the Trapeze Lease.
                  Notwithstanding the foregoing, Seller shall not be in default
                  under this Agreement if Seller is unable to obtain an estoppel
                  certificate from the tenant

                                       11



                  under the Trapeze Lease, and no costs, expenses or other
                  damages shall be due to Purchaser due to such event.

                  (b)      TITLE POLICY. At Closing, Seller shall cause the
         Title Company to deliver to Purchaser its owner's title insurance
         policy required by this Agreement, in the form of an ALTA Form
         (10/17/92) or a marked-up title commitment or pro forma owners policy,
         together with endorsements reasonably requested by Purchaser prior to
         the Contingency Date and which are approved by the Seller. If the
         owner's title insurance policy which the Title Company is prepared to
         issue shows any Unpermitted Encumbrances, Seller covenants and agrees,
         within thirty (30) days (such thirty (30)-day period being sometimes
         hereinafter referred to as the "Title Cure Period"), to use reasonable
         efforts to remove such Unpermitted Encumbrances or to cause the Title
         Company to issue its endorsement over any such Unpermitted
         Encumbrances, and the Closing shall be delayed in accordance with this
         Section 9(b) while Seller undertakes such efforts. If, after using
         reasonable efforts as aforesaid, Seller cannot cause such Unpermitted
         Encumbrances to be removed, or Seller cannot cause the Title Company to
         issue its endorsement over any such Unpermitted Encumbrances, on or
         before the expiration of the Title Cure Period, Purchaser shall, within
         five (5) business days following expiration of the Title Cure Period,
         elect either (i) to terminate this Agreement (other than the
         obligations set forth in Sections 3(b), 14 and 15 hereof, which
         obligations shall survive any such termination), or (ii) to take title
         to the Real Property as it then is (without any abatement in the
         Purchase Price). Failure of Purchaser to notify Seller within the
         aforesaid five (5)-business day period shall constitute Purchaser's
         irrevocable election under clause (ii) of the immediately preceding
         sentence. In the event that Purchaser terminates this Agreement as
         provided in clause (i) above, the Earnest Money shall be promptly
         returned to Purchaser, provided, however, upon such termination
         Purchaser shall, at the request of Seller, execute any document
         reasonably requested by Seller to evidence such termination, including,
         without limitation, a quit claim deed. Upon such termination, neither
         party will have any further rights or obligations (except the
         obligations of Purchaser under Section 3(b) and the obligations of
         Purchaser and Seller set forth in Sections 14 and 15 hereof, which
         obligations shall survive any such termination).

                  (c)      PURCHASER'S CLOSING DOCUMENTS. On the Closing Date,
         Purchaser shall execute and/or deliver or cause to be executed and/or
         delivered to Seller the following (collectively, "Purchaser's Closing
         Documents"):

                           (i)      PURCHASE PRICE. The Purchase Price, plus or
                  minus prorations and other adjustments, if any, by wire
                  transfer of immediately available funds to be received in
                  Title Company's trust account on or before 11:00 a.m. central
                  time on the Closing Date.

                           (ii)     TITLE DOCUMENTS. Such affidavits of
                  Purchaser and other documents as may be reasonably required by
                  the Title Company in order to record the Deed and issue the
                  title insurance policy required by this Agreement and which
                  are reasonably acceptable to Purchaser.

                                       12



                           (iii)    MISCELLANEOUS. Other documents reasonably
                  required to consummate the transaction this Agreement
                  contemplates.

                  (d)      PURCHASER'S AND SELLER'S CLOSING DOCUMENTS. On the
         Closing Date, Seller and Purchaser shall jointly execute and deliver
         the following (collectively, the "Joint Closing Documents"):

                           (i)      CLOSING STATEMENT. A closing statement in
                  form and substance reasonably acceptable to both Seller and
                  Purchaser, and consistent with the terms, provisions and
                  conditions of this Agreement, showing the Purchase Price and
                  all prorations, adjustments, credits and debits this Agreement
                  describes or requires.

                           (ii)     ASSIGNMENT AND ASSUMPTION OF LEASES. An
                  Assignment and Assumption of Leases in the form of Exhibit L
                  hereof.

                           (iii)    ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND
                  PROJECT DOCUMENTS. An Assignment and Assumption Agreement of
                  Contracts and Project Documents in the form of Exhibit M
                  hereto.

                           (iv)     NOTICES TO TENANT. Written notice to the
                  tenant under the Trapeze Lease advising it of the sale of the
                  Subject Property and directing it to make future lease
                  payments and to send all notices or other communications to
                  Purchaser at the place designated by Purchaser.

                           (v)      AFFIDAVIT OF PROPERTY VALUE. An Affidavit of
                  Property Value as required by the Arizona Department of
                  Revenue.

                           (vi)     DESIGNATION AGREEMENT. A Designation
                  Agreement executed by Seller, Purchaser and Title Company
                  designating the "reporting person" for purposes of completing
                  the Internal Revenue Service Form 1099 and, if applicable,
                  Internal Revenue Form 8594.

                           (vii)    MISCELLANEOUS. Such other documents,
                  instruments and affidavits as shall be reasonably necessary to
                  consummate the transaction contemplated by this Agreement,
                  including, without limitation, affidavits identifying any
                  brokers involved as the only persons entitled to a brokerage
                  or similar commission in connection with consummation of the
                  transaction contemplated hereby, and which are reasonably
                  acceptable to Seller and Purchaser.

                           (viii)   TAX AGREEMENT. A letter agreement by and
                  between Seller and Purchaser regarding allocation and
                  proration of real estate taxes (the "Tax Agreement").

                  (e)      ESCROW CLOSING. This transaction shall be closed
         through an escrow pursuant to escrow instructions reasonably acceptable
         to Seller and Purchaser or, if Seller and/or Purchaser fail to so
         agree, at the office of the Seller's attorney. The attorneys for both
         Seller and Purchaser are authorized to sign the escrow agreement. Upon
         the creation of such escrow, payment of the Purchase Price and delivery
         of the Deed shall be

                                       13



         made through the escrow. The cost of the deed and money escrow shall be
         divided equally between Seller and Purchaser; provided, however, that
         Purchaser shall be solely responsible for any costs associated with a
         separate money lender's escrow. This Agreement shall not be merged into
         nor in any manner superseded by the deed and money escrow agreement.

         10.      ADJUSTMENT AND PRORATIONS. Seller and Purchaser shall make all
adjustments and apportion all income and expenses with respect to the Subject
Property, including, without limitation, the following:

                  (a)      REAL ESTATE TAXES AND SPECIAL ASSESSMENTS. Seller
         shall be responsible for payment to the collecting authorities of all
         real estate taxes and installments of special assessments and other
         assessments of any kind or nature whatsoever ("Taxes") which have been
         assessed against the Real Property and which are due and payable as of
         the date (the "Proration Date") immediately preceding the Closing Date,
         and Purchaser shall be responsible for payment to the collecting
         authorities of all Taxes which have been or will be assessed and which
         become due and payable on and after the Closing Date. With respect to
         Taxes which have been assessed against the Real Property but which are
         not due and payable as of the day prior to the Closing Date, such Taxes
         shall be prorated as of the day prior to the Closing Date on the basis
         of the most recent ascertainable Taxes, with Seller providing Purchaser
         a credit at Closing for such prorated amount; provided, however, there
         shall be no proration of Taxes to the extent that Taxes are or will be
         payable by tenants under Leases, and provided further that Seller
         provides Purchaser a credit at closing in an amount equal to the
         monthly amounts which Seller has received from tenants under the Leases
         (and including any tax payments received under the McLeod Lease) for
         Taxes which have been assessed against the Real Property but which are
         not due and payable. To the extent the provisions of the Tax Agreement
         are inconsistent with this Section 10(a), the Tax Agreement shall
         control.

                  (b)      TITLE INSURANCE. Seller shall pay all title
         examination fees of Title Company and the premium for cost of the
         standard coverage portion of the Owner's Policy, without endorsements.
         Purchaser shall pay the costs of the extended coverage portion of the
         Owner's Policy and all fees Title Company charged for endorsements to
         the Owner's Policy.

                  (c)      SURVEY COSTS. Seller shall pay all costs of the
         Survey.

                  (d)      CLOSING FEE. Seller and Purchaser shall each pay
         one-half of the closing fee or escrow fee Title Company charges.

                  (e)      TRANSFER TAX. Seller shall pay all documentation,
         stamp and transfer taxes payable in connection with the transfer of the
         Subject Property (other than any mortgage registration tax or other
         fees or expenses applicable to any financing Purchaser secures).

                  (f)      RENTS/TENANT EXPENSE CONTRIBUTIONS. Except as
         described in subsection (g) below, Seller and Purchaser shall prorate
         on an accrual basis to the Closing

                                       14



         Date and on the basis of the most reliable information available, all
         current and advance rent payments of each tenant under the Leases; all
         real estate taxes, special assessments, operating expenses, insurance
         and other charges and amounts payable by each tenant under the Leases
         (collectively, "Expense Contributions"); all utility deposits made by
         Seller; and all other accrued and prepaid expenses and income. Seller
         shall receive a credit at Closing for all rent and additional rent due
         under the JDA Lease through and including the Closing Date. When actual
         Expense Contributions for the year in which Closing occurs are known,
         Purchaser shall bill the tenants under the Leases for the additional
         amount, if any, owed by such tenants as a result of non-payment or
         underpayment of such tenants' share of Expense Contributions for the
         year to which such Expense Contributions apply under the Leases. Upon
         collection of such amounts the same shall be reported between Seller
         and Purchaser, and Purchaser shall pay Seller all amounts due Seller
         for the period up to and including the Proration Date. In the event
         Expense Contributions collected by Seller for the period up to and
         including the Proration Date exceed actual Expense Contributions for
         such period, Seller shall pay to Purchaser an amount equal to the
         excess of Expense Contributions collected over actual Expense
         Contributions for such period as soon as reasonably practical after
         such Expense Contributions are known. Seller shall have the right, upon
         five (5) days written notice, to inspect the books and records of the
         Subject Property to verify that Purchaser is remitting to Seller all
         amounts required to be remitted to Seller according to the terms of
         this Agreement.

                  (g)      DELINQUENT RENTS UNDER THE TRAPEZE LEASE. In the
         event that on the Closing Date any tenant under the Trapeze Lease is
         delinquent in the payment of any rent (base rent and additional rent),
         billed but unpaid at the time of Closing, then no proration of such
         rent shall be made at Closing, and Seller may attempt to collect in the
         manner described in this subsection (g). With prior notice to
         Purchaser, Seller may take such action as Seller deems necessary
         against the tenant under the Trapeze Lease who is delinquent in the
         payment of rent (base rent or additional rent) as of the Closing Date
         to collect such unpaid rent; provided, however, that Seller will not
         attempt to terminate such tenant's right to possess its premises or its
         lease. If Seller recovers any amount from such tenant, Seller will
         apply such amount in the following order of priority: (a) first, to
         Seller to offset Seller's collection costs and rent accrued but unpaid
         prior to the Closing Date; and (b) second, the balance to Seller. If
         Purchaser recovers any such delinquent amounts, Purchaser will apply
         such amounts in the following order of priority: (a) first to Purchaser
         to offset Purchaser's collection costs and any rent accrued but unpaid
         after the Closing Date; and (b) second, the balance to Seller.

                  (h)      SECURITY DEPOSITS. Purchaser shall receive a credit
         against the Purchase Price in an amount equal to the sum of all
         unapplied cash security deposits in Seller's possession plus, if
         accrued interest on such security deposits must be reimbursed to any
         tenant that paid a security deposit, all interest accrued on such
         security deposits.

                  (i)      RECORDING COSTS. Seller shall pay all costs to record
         documents necessary for Seller to place record title to the Real
         Property in marketable condition. Purchaser shall pay the cost of
         recording the Deed and all other recording costs.

                                       15



                  (j)      McLEOD TERMINATION FEE. Purchaser shall receive a
         credit against the purchase Price in an amount equal to the McLeod
         Termination Fee (as defined in Section 26 hereof) to the extent such
         McLeod Termination Fee has been received by Seller.

                  (k)      OTHER COSTS. All other costs shall be allocated in
         accordance with the customs prevailing in similar transactions in the
         greater Phoenix, Arizona metropolitan area.

Except as otherwise expressly provided in this Agreement, all prorations
provided for herein shall be final.

         11.      DEFAULT/REMEDIES. In the event of a breach or default by
Seller in closing the transaction contemplated by this Agreement, Purchaser, as
its sole and exclusive remedy, shall have the right either (i) to terminate this
Agreement and receive a return of the Earnest Money, or (ii) to enforce specific
performance of this Agreement, provided that any action for specific performance
be commenced within ninety (90) days of the scheduled Closing Date, as the same
may have been extended pursuant to the provisions hereof. Except as otherwise
provided in Sections 3(b), 14 and 15 hereof, which shall survive termination of
the Agreement, in the event of a breach or default by Purchaser in closing the
transaction contemplated by this Agreement, Seller, as its sole and exclusive
remedy, shall have the right to terminate this Agreement and receive the Earnest
Money as liquidated damages, it being agreed by the Seller and the Purchaser
that the damages to the Seller in case of default by Purchaser may be impossible
to ascertain and that the Earnest Money constitutes a fair and reasonable amount
of damages in the circumstances. Nothing herein contained shall limit the rights
or obligations of the parties with respect to a default under this Agreement
occurring from and after the Closing Date, and in such case the parties shall
have all rights and remedies available at law, in equity or otherwise including,
without limitation, the right to specific performance, subject to the conditions
and limitations herein set forth including, without limitation, the provisions
of Section 7 hereof. Notwithstanding anything herein to the contrary, neither
party shall be entitled to receive special, consequential, incidental, or
punitive damages under this Agreement.

         12.      DAMAGE. If, prior to the Closing Date, all or any part of the
Improvements are substantially damaged by fire or other casualty, Seller shall
promptly give notice to Purchaser of such fact. Thereafter, at Purchaser's
option (to be exercised by Purchaser's written notice to Seller given within
thirty (30) days after Seller's initial notice to Purchaser), this Agreement
shall terminate. In the event of any such termination of this Agreement, neither
party will have any further obligations under this Agreement (other than the
obligations set forth in Sections 3(b), 14 and 15 hereof, which obligations
shall survive any such termination), and the Earnest Money shall be refunded to
Purchaser provided Purchaser is not in breach or default hereunder beyond any
applicable grace or cure period, and Purchaser shall, at the request of Seller,
execute any document reasonably requested by Seller to evidence such termination
including, without limitation, a quit claim deed. If Purchaser fails to elect to
terminate (in the manner provided in this Section 12) despite such damage, or if
the Improvements are damaged but not substantially, Seller shall promptly
commence to repair such damage or destruction and to return the Improvements to
substantially their condition prior to such damage. If such damage shall be
completely repaired prior to the Closing Date, then there shall be no reduction
in the Purchase Price, and Seller shall retain the proceeds of all insurance
related to such damage. If such

                                       16



damage shall not be completely repaired prior to the Closing Date, but Seller is
diligently proceeding to repair, then Seller shall complete the repair after the
Closing Date and shall be entitled to receive the proceeds of all insurance
related to such damage; provided, however, that Purchaser shall have the right
to delay the Closing Date until repair is completed. For purposes of this
Section 12, the words "substantially damaged" mean damage that would cost
$250,000 or more to repair, as reasonably determined by Seller.

         13.      CONDEMNATION. If, prior to the Closing Date, eminent domain
proceedings are commenced against all or any substantial part of the Subject
Property, Seller shall immediately give notice to Purchaser of such fact and, at
Purchaser's option (to be exercised within thirty (30) days after Seller's
notice), this Agreement shall terminate. In the event of any such termination,
neither party will have further obligations under this Agreement (other than the
obligations set forth in Sections 3(b) and 14 hereof, which obligations shall
survive any such termination), and the Earnest Money shall be refunded to
Purchaser provided Purchaser is not in breach or default hereunder beyond any
applicable grace or cure period, and Purchaser shall, at the request of Seller,
execute any document reasonably requested by Seller to evidence such termination
including, without limitation, a quit claim deed. If Purchaser fails to elect to
terminate (in the manner provided in this Section 13), then there shall be no
reduction in the Purchase Price, and Seller shall assign to Purchaser at the
Closing Date all of Seller's right, title and interest in and to any award made
or to be made in the condemnation proceedings. Prior to the Closing Date, Seller
shall not designate counsel, appear in, or otherwise act with respect to the
condemnation proceedings without Purchaser's prior written consent, which
consent shall not be unreasonably withheld or delayed; provided, however, that
if any action is necessary with respect to such proceeding to avoid any
forfeiture or material prejudice, Seller shall be entitled to take such action
as and to the extent necessary without obtaining Purchaser's prior written
consent. For purposes of this Section, the words "substantial part" mean the
fair market value of the portion of the Subject Property to be so taken exceeds
$250,000.

         14.      BROKER'S COMMISSION. Seller represents and warrants to
Purchaser that in connection with the transaction contemplated hereby, no third
party broker or finder has been engaged or consulted by Seller or is entitled to
compensation or commission in connection herewith other than R. Craig Coppola of
Lee & Associates Arizona (the "Broker"). Seller shall pay to the Broker a
commission in the aggregate amount of $236,000 at Closing, if the transaction
contemplated by the Agreement is consummated. Seller shall defend, indemnify and
hold harmless Purchaser from and against any and all claims of brokers, finders
or any like third party claiming any right to commission or compensation by or
through acts of Seller in connection herewith. Purchaser represents and warrants
to Seller that in connection with the transaction contemplated hereby, no third
party broker or finder has been engaged or consulted by Purchaser or is entitled
to compensation or commission in connection herewith other than the Broker.
Purchaser shall defend, indemnify and hold harmless Seller from and against any
and all claims of brokers, finders or any like party claiming any right to
commission or compensation by or through acts of Purchaser in connection
herewith. The indemnity obligations hereunder, in favor of both Seller and
Purchaser, shall include, without limitation, all damages, losses, risks,
liabilities and expenses (including, without limitation, reasonable attorneys'
fees and costs) arising from and related to matters being indemnified hereunder;
provided, however, that the total liability of Seller with respect to the
foregoing shall be subject to the conditions and limitations set forth in
Section 7 hereof. No broker, finder or like party shall be entitled to rely

                                       17



(as a third-party beneficiary or otherwise) on the provisions herein in claiming
any right to commission or compensation or otherwise. This Section 14 shall
survive the expiration or termination of this Agreement or the Closing for one
(1) year following the date of Closing.

         15.      MUTUAL INDEMNIFICATION. Seller and Purchaser agree to
indemnify each other against and hold each other harmless from all liabilities
(including reasonable attorneys' fees and costs in defending against claims)
arising out of the ownership, operation or maintenance of the Subject Property
for their respective periods of ownership; provided, however, nothing herein
shall diminish the defense, indemnity and hold harmless obligations of Purchaser
set forth in Section 3(b) hereof with respect to matters arising from or related
to the Tests. If and to the extent that the indemnified party has insurance
coverage, or the right to make claim against any third party for any amount to
be indemnified against as set forth above, the indemnified party will, upon full
performance by the indemnifying party of its indemnification obligations, assign
such rights to the indemnifying party or, if such rights are not assignable, the
indemnified party will diligently pursue such rights by appropriate legal action
or proceeding and assign the recovery and/or right of recovery to the
indemnifying party to the extent of the indemnification payment made by such
party; provided, however, any amounts recovered shall first be applied to
reimburse the indemnified party for any unreimbursed costs, expenses or
liabilities incurred in pursuing such rights or otherwise subject to and to the
extent of indemnification hereunder. The provisions of this paragraph shall
survive Closing and execution and delivery of the Deed, subject to the
conditions and limitations set forth in Section 7 of this Agreement. Nothing in
this Section 15 shall be construed to alter, modify or limit the indemnification
rights and obligations of the landlord and tenant under the JDA Lease pursuant
to the terms of the JDA Lease.

         16.      ASSIGNMENT. Except as provided below Purchaser may not assign
its rights under this Agreement without the prior written consent of Seller.
Notwithstanding the foregoing, Purchaser may assign its rights under this
Agreement prior to Closing to an entity controlled by Purchaser or under common
control with Purchaser without the prior consent of Seller, provided that
Purchaser provides written notice of any such assignment to Seller prior to
Closing. Any assignment (regardless of whether or not such assignment requires
consent of Seller) shall be subject to all the provisions, terms, covenants and
conditions of this Agreement, and the assignor shall, in any event, continue to
be and remain liable under this Agreement, as it may be amended from time to
time, as a principal and not as a surety without notice to such assignor. Any
such assignment and assumption shall be evidenced by a written agreement in form
and substance reasonably acceptable to Seller.

         17.      NOTICES. Any notice or other communication in connection with
this Agreement shall be in writing and shall be sent by United States certified
mail, return receipt requested, postage prepaid, by nationally recognized
overnight courier guarantee next business day delivery, by telecopy or facsimile
transmission (provided that such notice sent by facsimile is also sent via
nationally recognized overnight courier for guaranteed next business day
delivery), or by personal delivery, properly addressed as follows:

             If to Seller:        OPUS REAL ESTATE ARIZONA II, L.L.C.
                                  10350 Bren Road West
                                  Minnetonka, MN 95343
                                  Attn: Patrick E. Mascia

                                       18



                                  Facsimile No.: (952) 656-4750

             With a copy to:      Opus L.L.C.
                                  10350 Bren Road West
                                  Minnetonka, MN 55343
                                  Attn: Legal Department
                                  Facsimile No.: (952) 656-4755

             And a copy to:       Briggs and Morgan, Professional Association
                                  2200 IDS Center
                                  Minneapolis, MN 55402
                                  Attn: Charles R. Haynor
                                  Facsimile No. (612) 977-8650

             If to Purchaser:     JDA Software Group, Inc.
                                  14400 North 87th Street
                                  Scottsdale, AZ 85260
                                  Attn: Paul Mehlhorn, VP - Finance and Planning
                                  Facsimile No.: (480) 308-4265

             With a copy to:      JDA Software Group, Inc.
                                  14400 North 87th Street
                                  Scottsdale, AZ 85260
                                  Attn: Michael Bridge, Esq., VP and
                                     General Counsel
                                  Facsimile No.: (480) 308-3001

All notices shall be deemed given three (3) business days following deposit in
the United States mail with respect to certified or registered letters, one (1)
business day following deposit if delivered to an overnight courier guaranteeing
next day delivery and on the same day if sent by personal delivery or by
telecopy or facsimile transmission (with proof of transmission). Attorneys for
each party shall be authorized to give notices for each such party. Any party
may change its address for the service of notice by giving written notice of
such change to the other party, in any manner above specified.

         18.      CAPTIONS. The section headings or captions appearing in this
Agreement are for convenience only, are not a part of this Agreement, and are
not to be considered in interpreting this Agreement.

         19.      ENTIRE AGREEMENT; MODIFICATION. This Agreement constitutes the
entire agreement between the parties with respect to the subject matter herein
contained, and all prior negotiations, discussions, writings and agreements
between the parties with respect to the subject matter herein contained are
superseded and of no further force and effect. No covenant, term or condition of
this Agreement shall be deemed to have been waived by either party, unless such
waiver is in writing signed by the party charged with such waiver.

                                       19



         20.      BINDING EFFECT. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns.

         21.      CONTROLLING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Arizona without
application of the choice of law rules of Arizona.

         22.      SEVERABILITY. The unenforceability or invalidity of any
provisions hereof shall not render any other provision herein contained
unenforceable or invalid.

         23.      "AS IS" SALE. PURCHASER ACKNOWLEDGES THAT EXCEPT AS SET FORTH
IN THIS AGREEMENT OR IN THE DOCUMENTS SET FORTH IN SUBSECTIONS (i), (ii), (iii),
(v), (vii), (viii), (ix), and (x) OF SECTION 9(a) (A) NEITHER SELLER, NOR ANY
OWNER, PRINCIPAL, AGENT, ATTORNEY, EMPLOYEE, BROKER, OR OTHER REPRESENTATIVE OF
SELLER, HAS MADE ANY REPRESENTATION OR WARRANTY OF ANY KIND WHATSOEVER, EITHER
EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT PROPERTY OR ANY MATTER RELATED
THERETO, AND (B) PURCHASER IS NOT RELYING ON ANY WARRANTY, REPRESENTATION, OR
COVENANT, EXPRESS OR IMPLIED, WITH RESPECT TO THE CONDITION OF THE SUBJECT
PROPERTY, AND THAT PURCHASER IS ACQUIRING THE SUBJECT PROPERTY IN ITS "AS-IS"
CONDITION WITH ALL FAULTS. IN PARTICULAR, BUT WITHOUT LIMITATION, EXCEPT AS SET
FORTH IN THIS AGREEMENT OR THE DOCUMENTS SET FORTH IN SUBSECTIONS (i), (ii),
(iii), (v), (vii), (viii), (ix), and (x) OF SECTION 9(a), SELLER MAKES NO
REPRESENTATIONS OR WARRANTIES WITH RESPECT TO THE USE, CONDITION, OCCUPATION OR
MANAGEMENT OF THE SUBJECT PROPERTY, COMPLIANCE OF THE SUBJECT PROPERTY WITH
APPLICABLE STATUTES, LAWS, CODES, ORDINANCES, REGULATIONS OR REQUIREMENTS OR
COMPLIANCE OF THE SUBJECT PROPERTY WITH COVENANTS, CONDITIONS, AND RESTRICTIONS,
WHETHER OR NOT OF RECORD. PURCHASER ACKNOWLEDGES AND AGREES THAT PURCHASER WILL
CONDUCT ITS OWN INVESTIGATIONS AND STUDIES OF THE PROPERTY AND ALL ASPECTS
THEREOF, INCLUDING WITHOUT LIMITATION THE PROPERTY'S CHARACTERISTICS, ITS
PHYSICAL CONDITION (INCLUDING ANY DEFECTS THEREIN), ALL LEGAL REQUIREMENTS
APPLICABLE THERETO, THE OPERATION AND USE THEREOF, THE ENVIRONMENTAL CONDITION
OF THE PROPERTY AND ALL MATTERS DESCRIBED IN THE PRECEDING SENTENCE; IF FOR ANY
REASON WHATSOEVER PURCHASER IS PRECLUDED BY SELLER FROM CONDUCTING SUCH
INVESTIGATIONS AND STUDIES, PURCHASER SHALL BE REQUIRED TO GIVE WRITTEN NOTICE
THEREOF TO SELLER PRIOR TO THE CONTINGENCY DATE.

         24.      JDA LEASE PROVISIONS. Seller and Purchaser acknowledge that
this Agreement and the obligations of the parties hereunder are separate and
distinct from the JDA Lease and the obligations of the parties thereunder.
Notwithstanding anything to the contrary in this Agreement, the Purchaser shall
not be entitled to any additional benefits as tenant under the JDA Lease by
virtue of this Agreement. Without limiting the foregoing, Purchaser, in its
capacity as purchaser under this Agreement and as tenant under the JDA Lease,
acknowledges that (a) this Agreement shall not limit any ability of Seller to
pass through costs and expenses to Purchaser,

                                       20



in its capacity as tenant under the JDA Lease, pursuant to the terms of the JDA
Lease, even if such costs and expenses result from Sellers obligation under the
terms of this Agreement to make repairs, perform maintenance, rebuild the
Improvements, or prorate taxes or other expenses, and (b) the Purchaser shall
not be relieved of any of its obligations under the JDA Lease. This Agreement
shall not alter or modify the obligations of the landlord and tenant under the
JDA Lease, including without limitation rights and obligations that survive
termination of the JDA Lease pursuant to the terms of the JDA Lease. In
addition, this Agreement does not alter or modify the letter agreement dated
June 30, 2003 by and between Purchaser and Opus West Corporation relating to the
Phase II Building (as defined therein), and such letter agreement shall remain
in full force and effect following consummation of the sale pursuant to this
Agreement.

         25.      SCOTTSDALE NORTHSIGHT DECLARATION. The Purchaser and Seller
acknowledge that pursuant to a Declaration of Covenants, Conditions and
Restrictions and Grant of Easements for Scottsdale Northsight dated January 6,
2004 and recorded with the County Recorder of Maricopa County, Arizona as
Document No. 2004-0012154 (the "Declaration"), the parking spaces in the parking
structure located on the Subject Property shall be shared by the Owners (as
defined in the Declaration) and their Permittees (as defined in the Declaration)
pursuant to the terms and conditions of the Declaration. Further, Purchaser
acknowledges that a portion of the Real Property shown as Parcel 3 of the
attached Exhibit A (defined as the "Building Parcel" in the Declaration) may not
be a separate tax parcel as of the Closing Date, and the taxes relating to such
parcel shall be apportioned pursuant to the terms and conditions of the
Declaration. To the extent that Seller has received a tax proration payment for
first half 2004 taxes from Opus West Corporation with respect to the parcel
containing the parking structure, Seller shall provide a credit against the
Purchase Price to Purchaser at Closing for such amount. Seller and Purchaser
acknowledge that the Subject Property is subject to all terms and conditions of
the Declaration.

         26.      McLEOD LEASE TERMINATION. Seller has entered into a Lease
Termination Agreement dated January 15, 2004 (the "McLeod Termination
Agreement") with McLeodUSA Telecommunications Services, Inc. ("McLeod")
terminating the Lease dated June 15, 2000 (the "McLeod Lease") by and between
the Seller and McLeod, which termination is effective as of January 31, 2004.
Pursuant to such Lease Termination Agreement, McLeod has paid a termination fee
in the amount of $10,736 (the "McLeod Termination Fee") to Seller. Upon the
consummation of the sale of the Subject Property, Seller shall provide a credit
to Purchaser for the amount of the McLeod Termination Fee. In the event that the
sale of the Subject Property does not close pursuant to the terms and conditions
of this Agreement, Seller shall be entitled to retain the McLeod Termination
Fee.

         27.      TIME OF ESSENCE. Time is of the essence of this Agreement.

         28.      COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

         29.      INTERPRETATION. In the event an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as if drafted
jointly by the parties hereto and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any of the
provisions of this Agreement.

                                       21



         30.      TAX DEFERRED EXCHANGE. Seller shall have the right to
structure the sale of the Subject Property as a tax deferred exchange in
accordance with the provisions of Section 1031 of the Internal Revenue Code and
Purchaser agrees to accommodate the Seller's exchange so long as Purchaser does
not incur any additional expense, liability or delay.

         31.      ATTORNEYS' FEES. If either party commences an action against
the other to enforce this Agreement or because of the breach by either party of
this Agreement, the prevailing party in such action shall be entitled to recover
reasonable attorney fees, costs, and expenses (including expert fees and costs)
incurred in connection with the prosecution or defense of such action, including
any appeal, in addition to all other relief.

         32.      NO MERGER. Purchaser shall elect prior to Closing whether the
JDA Lease shall be terminated at Closing or assigned to Purchaser, as landlord.
In the event the JDA Lease is assigned at Closing, the Purchaser's interests as
fee owner of the Subject Property and tenant under the JDA Lease shall not merge
and shall remain separate and distinct.

         33.      INTEREST ON EARNEST MONEY. Pursuant to Section 2(b) hereof,
the term "Earnest Money" as used herein includes all interest earned on the
Earnest Money. The parties acknowledge and agree that the party entitled to
receive the Earnest Money pursuant to the terms and conditions of this Agreement
shall also be entitled to receive all accrued interest thereon.

         34.      EXHIBITS. The following exhibits are made a part hereof, with
the same force and effect as if specifically set forth herein:

         Exhibit A -    Legal Description
         Exhibit B -    Schedule of Leases
         Exhibit C      Schedule of Broker Commissions
         Exhibit D -    Schedule of Permits
         Exhibit E -    Schedule of Service Contracts
         Exhibit F -    Schedule of Warranties
         Exhibit G -    Form of Earnest Money Escrow Agreement
         Exhibit H -    Intentionally Omitted
         Exhibit I -    Form of Tenant Estoppel Certificate
         Exhibit J -    Form of Special Warranty Deed
         Exhibit K -    Form of Bill of Sale
         Exhibit L -    Form of Assignment and Assumption of Leases
         Exhibit M -    Form of Assignment and Assumption of Contracts
                        and Project Documents
         Exhibit N -    Revised Legal Description

                                       22



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

                                             SELLER:

                                             OPUS REAL ESTATE ARIZONA II, L.L.C.

                                             By: _____________________________
                                                 Its: Vice President

                                             PURCHASER:

                                             JDA SOFTWARE GROUP, INC.

                                             By: /s/ James D. Armstrong
                                                 -----------------------------
                                                 Its: ________________________

                                       23



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

                                             SELLER:

                                             OPUS REAL ESTATE ARIZONA II,
                                             L.L.C

                                             By: /s/ Patrick S. Mascia
                                                 -----------------------------
                                                 Its: vice President

                                             PURCHASER:

                                             JDA SOFTWARE GROUP, INC.

                                             By:______________________________
                                                Its:__________________________

                                       23



                                    EXHIBIT A

                               LEGAL DESCRIPTION

PARCEL NO. 1:

That portion of Parcel 2, as shown on the Map of Dedication for NORTHSIGHT,
according to Book 302 of Maps, Page 11 and Affidavit of Correction recorded as
87-0478660 of Official Records, Maricopa County, Arizona, located in a portion
of the Southeast quarter of Section 12, Township 3 North, Range 4 East of the
Gila and Salt River Base and Meridian, Maricopa County, Arizona, more
particularly described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, as shown on said MAP OF DEDICATION FOR NORTHSIGHT, according to
Book 302 of Maps, Page 11 and Affidavit of Correction recorded as 87-0478660,
Official Records of Maricopa County, Arizona, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, as shown on said MAP OF DEDICATION FOR NORTHSIGHT a distance of
661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the Parcel herein described;

thence North 89 degrees 52 minutes 51 seconds West, leaving said Westerly
right-of-way line, a distance of 770.93 feet;

thence North 00 degrees 13 minutes 51 seconds West, a distance of 272.42 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 772.60 feet to
a point on said Westerly right of way of 87th Street;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly right of
way, a distance of 272.41 feet to the POINT OF BEGINNING of the Parcel herein
described.

PARCEL NO. 2:

A non-exclusive easement for ingress, egress and utilities as set forth in
Easement Agreement recorded September 6, 2000 in 00-687539.

PARCEL NO. 3:

A portion of Parcel 2, as shown on the Map of Dedication for NORTHSIGHT,
according to Book 302 of Maps, Page 11 and Affidavit of Correction recorded in
87-0478660, of Official Records, located in a portion of the Southeast quarter
of Section 12, Township 3 North, Range 4

                                      A-1



East of the Gila and Salt River Base and Meridian, Maricopa County, Arizona,
more particularly described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, a distance of 661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the parcel described herein;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly
right-of-way line, a distance of 148.03 feet to a point of curvature of a
tangent curve, concave Westerly, having a radius of 955.00 feet;

thence Southerly along the arc of said curve and said Westerly right-of-way
line, through a central angle of 22 degrees 46 minutes 21 seconds, 379.57 feet
to a point of non-tangency;

thence North 67 degrees 06 minutes 30 seconds West, a distance of 105.37 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 98.42 feet;

thence North 44 degrees 52 minutes 51 seconds West, a distance of 352.47 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 129.25 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 420.83 feet to
the POINT OF BEGINNING of the parcel described herein.

PARCEL NO. 4:

Easements as set forth in the Declaration of Covenants, Conditions and
Restrictions and Grant of Easements for Scottsdale NORTHSIGHT dated January 6,
2004 and recorded January 6, 2004 as Document No. 2004-0012154 of Official
Records of Maricopa County, Arizona.

PARCEL NO. 5:

Easements as set forth in the Slope and Temporary Stock Pile, Staging and
Construction Easement Agreement dated June 23, 1998 and recorded June 26, 1998
as 98-546099 of Official Records, of Maricopa County, Arizona, as amended by
that certain First Amendment to Slope and Temporary Stockpile Staging and
Construction Easement Agreement recorded January 6, 2004 as Document No.
2004-0012151 of Official Records.

                                      A-2



                                    EXHIBIT B

                               SCHEDULE OF LEASES

1.   Trapeze Software, Inc.

          a.   Lease dated August 26, 1999

          b.   Letter of Credit dated September 3, 2003

                    i.   Amendment to LOG dated September 11, 2003

                    ii.  Amendment to LOG dated September 17, 2003

2.   JDA Software Group, Inc.

          a.   Lease dated April 30, 1998

          b.   First Amendment to Office Lease dated June 30, 1998

          c.   Second Amendment to Office Lease dated November 30, 1998

          d.   Letter Agreement dated October 6, 1999

          e.   Third Amendment to Office Lease dated October 8, 1999

          f.   Revised and Restated Third Amendment to Office Lease dated
               October 20, 1999

          g.   Fourth Amendment to Office Lease dated May 30, 2001

          h.   Fifth Amendment to Office Lease dated May 31, 2001

          i.   Sixth Amendment to Office Lease dated August 31, 2003

          j.   Seventh Amendment to Office Lease dated June 30, 2003

3.   McLeodUSA Telecommunication Services, Inc. *NOTE: THE MCLEOD LEASE WILL
     TERMINATE ON JANUARY 31, 2004 PURSUANT TO THE TERMS OF THE MCLEOD
     TERMINATION AGREEMENT*

          a.   Lease dated June 15, 2000

          b.   Guarantee dated May 5, 2000

          c.   Lease Termination Agreement dated January 15, 2004

4.   Voice Stream PCS III, Corporation

          a.   Telecommunications License Agreement dated July 1, 2003

                                      B-1



                                    EXHIBIT C

                         SCHEDULE OF BROKER COMMISSIONS

                                      NONE.

                                      C-1



                                    EXHIBIT D

                               SCHEDULE OF PERMITS

                                      NONE.

                                      D-1


                                    EXHIBIT E

                          SCHEDULE OF SERVICE CONTRACTS



         VENDOR                              DESCRIPTION           START DATE    END DATE
         ------                              -----------           ----------    --------
                                                                       
Clola Enterprises                      Janitorial & Day Porter        1/1/2004  12/31/2004
Truly Nolen                            Pest Control                   4/1/2003   3/31/2004
WE Landscape Group, LLC                Landscape Maintenance          4/1/2003   3/31/2004
HiRise Service                         Window Washing                11/1/2003  10/31/2004
                                       Parking Lot Light
Red Dog Illuminations                  Maintenance                    5/1/2003   4/30/2004
Paradise Waste                         Trash Removal                  6/1/2003   5/31/2004
Arizona Sterling Protection            Security                       6/1/2003   5/31/2004
Cactus Sweeping                        Parking Lot Sweeping           9/1/2003   8/31/2004
Arizona Fire & Security                Alarm Monitoring             11/14/2003      -
Skyline Fire & Communications          Fire Alarm Monitoring         3/16/1999      -


                                      E-1


                                    EXHIBIT F

                             SCHEDULE OF WARRANTIES



        Name                   Product/Service                   Expiration Date
- ---------------------------------------------------------------------------------------
                                                    
Pleko Southwest, Inc.      EIFS                           2/14/2004
Specialty Roofing          Roof Work                      3/31/2004
                           Pleko Insulated Finish
Canyon Plastering          System                         3/31/2004
Standard Restaurant
Equipment Co.              Commercial Ice System          6/15/2004
GAP Materials
Corporation                Roofing Membrane               3/31/2009
                           Thermopane Insulating
Interpane                  Glass                          3/31/2009
Anodizing, Inc.            Aluminum Painting              3/31/2019
Interstate Interior        Washroom Partitions &          Mirrors guaranteed against
Systems                    Accessories, Bicycle Racks     silver spoilage until 3/3 1/14
                                                          3/31/09, Motors & Electrical
Mountain States            MechoShade & ElectroShad       accessories guaranteed until
Drapery                    System                         3/31/04
Opus West                     Limited Warranty on         December 14, 2004
Corporation                Parking Facilities, pursuant
                            to Section 27 of Exchange
                             Agreement dated June 30,
                                     2003


                                       F-1


                                    EXHIBIT G

                     FORM OF EARNEST MONEY ESCROW AGREEMENT

         THIS EARNEST MONEY ESCROW AGREEMENT ("Agreement") is made as of
January_____, 2004, by and among OPUS REAL ESTATE ARIZONA II, L.L.C., a Delaware
limited liability company ("Seller"), JDA SOFTWARE GROUP, INC., a Delaware
corporation ("Purchaser"), and FIRST AMERICAN TITLE INSURANCE COMPANY, a
California corporation ("Escrow Agent").

                                    RECITALS:

         A.       By that certain Purchase Agreement dated as of January____,
2004 ("Purchase Agreement"), between Seller and Purchaser, Seller has agreed to
sell to Purchaser and Purchaser has agreed to purchase from Seller all of
Seller's right, title and interest in and to the Subject Property, upon and
subject to the terms and provisions set forth in the Purchase Agreement.

         B.       Seller and Purchaser desire that Escrow Agent act as escrowee
to receive, hold and disburse funds in the manner hereinafter set forth.

         C.       Unless otherwise provided herein, all capitalized words and
terms used herein shall have the same meanings ascribed to such words and terms
as in the Purchase Agreement.

         NOW THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

         1.       Upon execution of the Purchase Agreement, Purchaser shall
deposit with Escrow Agent the sum of Two Hundred Thirty-Eight Thousand and
00/100 Dollars ($238,000.00) as the Initial Earnest Money ("Initial Earnest
Money"). Within two (2) days after the Contingency Date, Purchaser shall deposit
One Million Two Hundred Sixty-Two Thousand and 00/100 Dollars ($1,262,000.00) as
Additional Earnest Money. Upon receipt by Escrow Agent, the Initial Earnest
Money and Additional Earnest Money shall be invested in Escrow Agent's separate
and segregated money market account. Purchaser shall be entitled to the interest
accrued on the Earnest Money and the Earnest Money shall include such accrued
interest. Escrow Agent shall acknowledge to Seller, in writing, receipt of the
Initial Earnest Money and Additional Earnest Money when it is delivered to
Escrow Agent.

         2.       Purchaser's Tax Identification Number is 86-0787377.

         3.       Escrow Agent is hereby released and exculpated of all
liability whatsoever arising out of or in connection with its activities as
Escrow Agent hereunder, except to the extent of loss or damage caused by its
negligence, breach of fiduciary duty, failure to comply with the terms of this
Earnest Money Escrow Agreement or willful misconduct. Purchaser and Seller
hereby jointly indemnify and hold Escrow Agent harmless from and against any and
all claims, liabilities, judgments, attorney's fees and other expenses of every
kind or nature arising out of this Earnest Money Escrow Agreement, other than
such claims, liabilities, judgments, attorney's

                                       G-1


fees and other expenses resulting from the negligence, breach of fiduciary duty
or willful misconduct of Escrow Agent or Escrow Agent's failure to comply with
the terms of this Earnest Money Escrow Agreement.

         4.       In the event Escrow Agent receives written notice of default,
non-performance, dispute or exercise of right under the Purchase Agreement from
Seller or Purchaser accompanied by a demand for delivery to such party of the
Earnest Money, Escrow Agent is immediately to give written notice to the other
party of such claim and accompanying demand. In the event the other party fails
to dispute or object to such claim and demand within five (5) business days from
the date of Escrow Agent's written notice, Escrow Agent is authorized to deliver
the Earnest Money to the party making such claim and demand. In the event the
other party disputes or objects to the aforesaid claim and demand within the
5-business day period prescribed herein, Escrow Agent is not to deliver the
Earnest Money deposited hereunder without receipt of a mutual agreement of the
parties, in writing, or appropriate court order. In such an event, Escrow Agent
shall either hold the same, or at Escrow Agent's election, deposit the same with
a court of competent jurisdiction to determine how the Earnest Money should be
disbursed. Escrow Agent shall be entitled to rely on the decision of such court
with respect to the disposition of the Earnest Money. In the event of any
dispute regarding disposition of any portion of the Earnest Money, Escrow Agent
shall be entitled to consult with its counsel and receive reimbursement for all
reasonable expenses of such consultation with respect to its duties as Escrow
Agent. All such expenses shall be paid from the Earnest Money deposited herein
to the extent such funds are sufficient, with an amount equal to the same being
promptly paid to the recipient of the Earnest Money, whether Purchaser or
Seller, by the non-prevailing party in the dispute, whether Purchaser or Seller.
Subject to the foregoing, this Agreement shall at all times be subject to the
joint order of Seller and Purchaser and upon such joint order Escrow Agent shall
deliver the Earnest Money as instructed by such joint order.

         5.       There shall be no escrow fee hereunder. Purchaser shall be
responsible for payment of any investment fee.

         6.       Any notice or other communication in connection with this
Agreement shall be in writing and shall be sent by United States certified mail,
return receipt requested, postage prepaid, by nationally recognized overnight
courier guarantee next day delivery, by telecopy or facsimile transmission
(provided that such notice sent by facsimile is also sent via nationally
recognized overnight courier for guaranteed next business day delivery), or by
personal delivery, properly addressed as follows:

                  If to Seller:         OPUS REAL ESTATE ARIZONA II, L.L.C.
                                        10350 Bren Road West
                                        Minnetonka, MN 55343
                                        Attn: Patrick E. Mascia
                                        Facsimile No.: (952) 656-4750

                  With a copy to:       Opus L.L.C.
                                        10350 Bren Road West
                                        Minnetonka, MN 55343

                                      G-2


                                        Attn: Legal Department
                                        Facsimile: (952) 656-4755

                   And a copy to:       Briggs and Morgan, P.A.
                                        2200 IDS Center
                                        Minneapolis, MN 55402
                                        Attn: Charles R. Haynor
                                        Facsimile No.: (612) 977-8650

                   If to Purchaser:     JDA Software Group, Inc.
                                        14400 North 87th Street
                                        Scottsdale, AZ 85260
                                        Attn: Paul Mehlhorn, VP-Finance and
                                            Planning
                                        Facsimile No.: (480) 308-4265

                  With a copy to:       JDA Software Group, Inc.
                                        14400 North 87th Street
                                        Scottsdale, AZ 85260
                                        Attn: Michael
                                        Bridge, Esq., VP and
                                            General Counsel
                                        Facsimile No.: (480) 308-3001

                  If to Escrow Agent:   First American Title Insurance Company
                                        4801 East Washington
                                        Suite 110
                                        Phoenix,  AZ 85034
                                        Attn: Carol Peterson
                                        Facsimile No.: (602) 685-7580

Copies of all notices hereunder shall be sent to the Escrow Agent at the address
show above. All notices shall be deemed given three (3) business days following
deposit in the United States mail with respect to certified or registered
letters, one (1) business day following deposit if delivered to an overnight
courier guaranteeing next business day delivery and on the same day if sent by
personal delivery or by telecopy or facsimile transmission (with proof of
transmission). Attorneys for each party shall be authorized to give notices for
each such party. Any party may change its address for the service of notice by
giving written notice of such change to the other party, in any manner above
specified.

         7.       This Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and permitted assigns
under the Purchase Agreement.

         8.       This Agreement shall be governed by and construed in
accordance with the laws of the State of Arizona. In the event that any
provision hereof shall be deemed illegal or unenforceable, said provision shall
be severed herefrom and the remainder of this Agreement shall be enforced in
accordance with the intentions of the parties as herein expressed.

                                      G-3


         9.       This Agreement may not be amended or altered except by an
instrument in writing executed by all the parties hereto.

         10.      If any party shall bring suit against the other to enforce the
terms of this Agreement, the losing party shall pay to the prevailing party the
prevailing party's costs and expenses (including, without limitation, reasonable
attorneys' fees and costs) incurred in enforcing this Agreement.

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

                                        SELLER:

                                        OPUS REAL ESTATE ARIZONA II, L.L.C.

                                        By:____________________________________

                                            Its:_______________________________

                                        PURCHASER:

                                        JDA SOFTWARE GROUP, INC.

                                        By:____________________________________

                                            Its:_______________________________

ESCROW AGENT:
FIRST AMERICAN TITLE INSURANCE COMPANY

By:_______________________________

Its:______________________________

                                      G-4


                                    EXHIBIT H

                             INTENTIONALLY OMITTED.

                                      H-1


                                    EXHIBIT I

                       FORM OF TENANT ESTOPPEL CERTIFICATE

TO: _________________________

    _________________________

    _________________________

RE: Property Address:
Lease Date:
Between_______________________________________, Landlord
and____________________________________________, Tenant
Square Footage Leased
Suite No.
Floor

         The undersigned, Tenant under the above-referenced lease ("Lease"),
certifies to ______________, the following:

         1.       A true and correct copy of the Lease is attached hereto. The
Lease is in full force and effect and has not been canceled, modified, assigned,
extended or amended except as follows:

         2.       There is no prepaid rent, except $__________________and the
amount of security deposit is $___________________________, of which
$_____________________has been applied.

         3.       The Lease commenced on__________________,________, and the
current monthly Base Rent is___________________________. Base Rent was last paid
on__________________________, 2004 and has been paid
through______________________________, 2004.

         4.       The lease terminates on __________________, 2004 and we have
the following renewal option (s):_____________________________________________.

         5.       All work to be performed for us under the Lease has been
performed as required and has been accepted by us, except______________________.

         6.       The Lease is in full force and effect, free from default and
there are no claims against the Landlord or offsets against rent.

         7.       The undersigned has not assigned its interest in the Lease or
sublet the premises or any thereof or pledged or hypothecated its interest on
the Lease, except______________________.

         8.       That the premises as let are being used for the purpose as
described in said Lease.

         9.       The data in the heading of this Certificate are true and
correct.

         10.      There are no unpaid improvement allowances owing under the
Lease.

                                       I-1


         11.      There are no agreements, other than the Lease, between
Landlord and the undersigned with respect to the premises.

         12.      The undersigned has not entered into any agreement with any
broker relating to the premises, pursuant to which any brokerage commission is
due.

         The undersigned individual is duly authorized to execute and deliver
this certificate. The undersigned understands that you and your successors and
assigns will rely on this certificate in purchasing the subject property.

Dated this____________day of________________, 2004.

TENANT:

By:_________________________________________

Its:________________________________________

                                       I-2


                                    EXHIBIT J

                          FORM OF SPECIAL WARRANTY DEED

WHEN RECORDED RETURN TO
JDA SOFTWARE GROUP, INC.
14400 North 87th Street
Scottsdale, AZ 85260
Attn: Michael Bridge, Esq., VP and General Counsel

                              SPECIAL WARRANTY DEED

         For the consideration of Ten Dollars and other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
undersigned OPUS REAL ESTATE ARIZONA II, L.L.C., a Delaware limited liability
company (the "Grantor"), does hereby grant and convey to JDA SOFTWARE GROUP,
INC., a Delaware corporation (the "Grantee"), that certain real property
situated in Maricopa County, Arizona, legally described as set forth on Exhibit
A attached hereto, together with al rights and privileges appurtenant thereto
and any improvements thereon.

         The above-described property is conveyed subject to all taxes and other
assessments, reservations in patents, and all easements, rights of way,
encumbrances, liens, covenants, conditions, restrictions, obligations and
liabilities that are listed on Exhibit B attached hereto.

         The Grantor hereby binds itself and its successors to warrant and
defend the title as against all acts of the Grantor herein and no other, subject
to the matters above set forth.

         IN WITNESS WHEREOF, the Grantor has caused this instrument to be
executed this _____day of_______________________, 2004.

                                        OPUS REAL ESTATE ARIZONA II, L.L.C.,
                                        a Delaware limited liability company

                                        By_____________________________________

                                        Name:__________________________________

                                        Title:_________________________________

                                       J-1


STATE OF MINNESOTA         )
                           )SS.
COUNTY OF HENNEPIN         )

         The foregoing instrument was acknowledged before me this
___________________ day of_________________, 2004, by___________________, the
Vice President of Opus Real Estate Arizona II, L.L.C., a Delaware limited
liability company, on behalf of said limited liability company.

                                  ____________________________________
                                  Notary Public

My commission expires:___________________

                                       J-2


                      EXHIBIT "A" TO SPECIAL WARRANTY DEED

                                LEGAL DESCRIPTION

PARCEL NO. 1:

Parcel 3, as shown on the Map of Dedication for Northsight II, according to
Book_____________________of Maps, Page_______, Records of Maricopa County,
Arizona, located in a portion of Parcel 2 of the Map of Dedication for
Northsight per Book 302 of Maps, Page________________, Maricopa County Records
and also a portion of the Southeast Quarter of Section 12, Township 3 North,
Range 4 East of the Gila and Salt River Base and Meridian, Maricopa County,
Arizona, more particularly described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, as shown on said MAP OF DEDICATION FOR NORTHSIGHT, according to
Book 302 of Maps, Page 11 and Affidavit of Correction recorded as 87-0478660,
Official Records of Maricopa County, Arizona, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, as shown on said MAP OF DEDICATION FOR NORTHSIGHT a distance of
661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the Parcel herein described;

thence North 89 degrees 52 minutes 51 seconds West, leaving said Westerly
right-of-way line, a distance of 770.93 feet;

thence North 00 degrees 13 minutes 51 seconds West, a distance of 272.42 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 772.60 feet to
a point on said Westerly right of way of 87th Street;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly right of
way, a distance of 272.41 feet to the POINT OF BEGINNING of the Parcel herein
described.

PARCEL NO. 2:

A non-exclusive easement for ingress, egress and utilities as set forth in
Easement Agreement recorded September 6, 2000 in 00-687539.

PARCEL NO. 3:

Parcel 2, as shown on the Map of Dedication for Northsight II, according to
Book____of Maps, Page______, Records of Maricopa County, Arizona, located in a
portion of Parcel 2 of the Map of Dedication for Northsight per Book 302 of
Maps, Page______, Maricopa County Records and also a

                                       J-3


portion of the Southeast Quarter of Section 12, Township 3 North, Range 4 East
of the Gila and Salt River Base and Meridian, Maricopa County, Arizona, more
particularly described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, a distance of 661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the parcel described herein;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly
right-of-way line, a distance of 148.03 feet to a point of curvature of a
tangent curve, concave Westerly, having a radius of 955.00 feet;

thence Southerly along the arc of said curve and said Westerly right-of-way
line, through a central angle of 22 degrees 46 minutes 21 seconds, 379.57 feet
to a point of non-tangency;

thence North 67 degrees 06 minutes 30 seconds West, a distance of 105.37 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 98.42 feet;

thence North 44 degrees 52 minutes 51 seconds West, a distance of 352.47 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 129.25 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 420.83 feet to
the POINT OF BEGINNING of the parcel described herein.

PARCEL NO. 4:

Easements as set forth in the Declaration of Covenants, Conditions and
Restrictions and Grant of Easements for Scottsdale NORTHSIGHT dated January 6,
2004 and recorded January 6, 2004 as Document No. 0012154 of Official Records of
Maricopa County, Arizona.

PARCEL NO. 5:

Easements as set forth in the Slope and Temporary Stock Pile, Staging and
Construction Easement Agreement dated June 23, 1998 and recorded June 26, 1998
as 98-546099 of Official Records, of Maricopa County, Arizona, as amended by
that certain First Amendment to Slope

                                       J-4


and Temporary Stockpile Staging and Construction Easement Agreement recorded
January 6, 2004 as Document No. 2004-0012151 of Official Records.

                                       J-5


                      EXHIBIT "B" TO SPECIAL WARRANTY DEED

                             PERMITTED ENCUMBRANCES

1.       Second installment of 2003 taxes, a lien, payable on or before March 1,
         2004, and delinquent May 1, 2004 (affects all parcels).

2.       Reservations contained in the Patent from the United States of America,
         reading as follows:

         Subject to any vested and accrued water rights for mining,
         agricultural, manufacturing, or other purposes, and rights to ditches
         and reservoirs used in connection with such water rights as may be
         recognized and acknowledged by the local customs, laws and decisions of
         courts; and there is reserved from the lands hereby granted, a right of
         way thereon for ditches or canals constructed by the authority of the
         United States of America.

         Affects all parcels.

3.       Water rights, claims or title to water, whether or not shown by the
         public records (affects all parcels).

4.       Easements, restrictions, reservations, conditions and set-back lines as
         set forth on the plat recorded in Book 302 of Maps, Page 11 and
         Affidavit of Correction recorded as 87- 478660 of Official Records and
         Restrictions set forth in Notes 2 3 and 4 of said Map of Dedication,
         but deleting any covenant, condition or restriction indicating a
         preference, limitation or discrimination based on race, color,
         religion, sex, handicap, familial status or national origin to the
         extent such covenants, conditions or restrictions violate 42 USC
         3604(c) (affects all parcels).

5.       The terms, conditions and provisions contained in the document entitled
         "Slope and Temporary Stockpile, Staging and Construction Easement
         Agreement" recorded June 26, 1998 as 98-0546099 of Official Records and
         First Amendment to Slope and Temporary Stockpile, Staging and
         Construction Easement Agreement recorded January 6, 2004 as Document
         No. 2004-0012151 of Official Records (Affects parcels 1, 2 and 3 only).

6.       The terms, conditions and provisions contained in the document entitled
         "City of Scottsdale Lot Split Approval" recorded December 3, 1998 as
         98-1096697 of Official Records (affects all parcels).

7.       The terms, conditions and provisions contained in the document entitled
         "Easement Agreement" recorded September 6, 2000 as 2000-0687539 of
         Official Records (affects parcels 1 and 2).

                                       J-1


8.       The terms, conditions and provisions contained in the document entitled
         "City of Scottsdale Lot Split Approval" recorded September 27, 2000 as
         2000-0737007 of Official Records (affects parcels 1 and 2).

9.       The terms, conditions and provisions contained in the document entitled
         "Memorandum of Design Approval Rights" recorded August 31, 2001 as
         2001-0813633 of Official Records (affects parcels 1 and 2).

10.      The following matters disclosed by an ALTA/ACSM survey made by DEI
         Professional Services, L.L.C. on January 23, 2003, designated Job No.
         02082 (affects parcels 1 and 2):

         a)       The fact that a dirt ditch runs North to South along an
                  Easterly portion of said land.

         b)       Encroachment of curbing and asphalt and sign in a Southeastern
                  portion of said land outside driveway easement.

11.      The terms, conditions and provisions contained in the document entitled
         "Development Fee Agreement" recorded September 22, 2003 as 2003-1329156
         of Official Records (affects all parcels).

12.      Covenants, conditions and restrictions in the Declaration of Covenants,
         Conditions and Restrictions and Grant of Easements for Scottsdale
         Northsight document recorded January 6, 2004 as Document No.
         2004-0012154 of Official Records, but deleting any covenant, condition
         or restriction indicating a preference, limitation or discrimination
         based on race, color, religion, sex, handicap, familial status, or
         national origin, to the extent such covenants, conditions or
         restrictions violate Title 42, Section 3604(c), of the United States
         Codes (affects all parcels).

13.      The terms, conditions and provisions contained in the document entitled
         "City of Scottsdale Drainage and Flood Control Easement and Provision
         for Maintenance" recorded October 29, 2003 as 2003-1502695 of Official
         Records (affects parcels 1, 2, 3 and 4 only).

14.      An easement for sight distance and incidental purposes, recorded as
         2003-1509935 of Official Records (affects all parcels).

15.      Easement for electric lines and incidental purposes, recorded as
         98-1081935 of Official Records (parcels 3, 4 and 5 only).

16.      The terms, conditions and provisions contained in the document entitled
         "City of Scottsdale Lot Split Approval" recorded March 17, 2003 as
         2003-0325766 of Official Records (affects parcels 3, 4 and 5 only).

17.      The terms, conditions and provisions contained in the document entitled
         "Development Fee Agreement" recorded January 14, 1999 as 99-38588 of
         Official Records (affects parcels 3, 4 and 5 only).

                                       J-2


18.      Rights of Trapeze Software, Inc., as tenant only, under an unrecorded
         lease dated August 26, 1999, as disclosed by Subordination, Attornment
         and Non-Disturbance Agreement recorded November 9, 1999 as 99-1030456
         of Official Records (affects parcels 3, 4 and 5 only). The lease under
         which the tenant is occupying space does not contain any options to
         purchase or rights of first refusal covering all or any portion of the
         fee interest in the land or the building thereon.

19.      Rights of JDA Software Group, Inc., as tenant only, under an unrecorded
         lease dated April 30, 1998, as disclosed by Subordination, Attornment
         and Non-Disturbance Agreement recorded November 9, 1999 as 99-1030457
         of Official Records (affects parcels 3, 4 and 5 only). The lease under
         which the tenant is occupying space does not contain any options to
         purchase or rights of first refusal covering all or any portion of the
         fee interest in the land or the building thereon.

                                       J-3


                                    EXHIBIT K

                              FORM OF BILL OF SALE

                                  BILL OF SALE

         This Bill of Sale ("Bill of Sale") is executed this______________day
of__________________________, 2004, by OPUS REAL ESTATE ARIZONA II, L.L.C., a
limited liability company created and existing under and by virtue of the laws
of the State of Delaware ("Seller"), in favor of JDA SOFTWARE GROUP, INC., a
Delaware corporation ("Purchaser").

         1.       Reference to Purchase Agreement. Reference is made to that
certain Purchase Agreement dated as of January______________, 2004, by and
between Seller and Purchaser, pursuant to which Seller has agreed to sell to
Purchaser, and Purchaser has agreed to purchase from Seller, the improved real
property and other assets described therein ("Purchase Agreement"). Capitalized
terms used herein and not otherwise defined herein shall have the meaning set
forth in the Purchase Agreement.

         2.       Sale. For good and valuable consideration received by Seller,
the receipt and sufficiency of which are hereby acknowledged, Seller hereby
sells, assigns and transfers the Personal Property to Purchaser.

         3.       Warranties. Seller makes no warranties or representations as
to the Personal Property. Among other things, all warranties of quality, fitness
for a particular purpose or merchantability are hereby expressly excluded.

         In witness whereof Seller has executed this Bill of Sale the day and
year first above written.

                                        Seller:

                                        OPUS REAL ESTATE ARIZONA II, L.L.C.

                                        By______________________________________

                                           Its__________________________________

                                       K-1


                                    EXHIBIT L

                       ASSIGNMENT AND ASSUMPTION OF LEASES

         THIS ASSIGNMENT AND ASSUMPTION OF LEASES ("Assignment") is made as
of________________, 2004 ("Effective Date"), by and between OPUS REAL ESTATE
ARIZONA II, L.L.C., a Delaware limited liability company ("Assignor"), and JDA
SOFTWARE GROUP, INC., a Delaware corporation ("Assignee").

                                    RECITALS:

         A.       Assignee has acquired from Assignor title to that certain real
property, and any improvements situated thereon owned by Assignor, more
particularly described on Exhibit "A" attached hereto ("Property") pursuant to a
Purchase Agreement dated as of January_______________, 2004 (the "Purchase
Agreement").

         B.       In connection with the conveyance of the Property from
Assignor to Assignee, Assignor and Assignee intend and agree that, except as
provided below, all of Assignor's rights as lessor under the leases, together
with all amendments or modifications thereto, including the rights to all
security deposits, letters of credit, delinquent rents and charges, prepaid
rents and all guaranties thereof, as set forth on Exhibit "B" attached hereto
(each a "Lease," and collectively, the "Leases"), shall be assigned to Assignee.

         C.       Assignee has agreed to assume all of the obligations of
Assignor under the Leases as set forth herein.

                                   AGREEMENT:

         In consideration of the foregoing recitals and other good and valuable
consideration, Assignor and Assignee agree as follows:

         1.       ASSIGNMENT BY ASSIGNOR. Assignor hereby assigns and transfers
to Assignee all right, title and interest of Assignor in and to each of the
Leases together with any rights relating thereto, including without limitation
all rents, issues, profits therefrom, all guaranties thereof and all security
deposits and letters of credit relating thereto. Notwithstanding the foregoing,
Assignor reserves the right to enforce against the tenants under the Leases all
obligations or duties of such tenants that arose or accrued prior to the
Effective Date, provided, however, in no event shall Assignor terminate any
Lease or disturb any tenant's right to occupy its respective premises as a
result of Assignor's enforcement of such reserved rights.

         2.       ACCEPTANCE OF ASSIGNMENT. Assignee hereby accepts the
assignment of the Leases and assumes and agrees to keep, perform and fulfill all
of the duties, covenants, provisions, conditions and obligations of the landlord
in the Leases which arise or are incurred or are related to events occurring
from and after the Effective Date.

                                       L-1


         3.       INDEMNIFICATION BY ASSIGNOR. Assignor will indemnify, defend
and hold harmless Assignee and Assignee's employees, partners, directors,
officers, affiliates, subsidiaries, shareholders, agents and representatives
from any and all liabilities, claims, damages, costs or expenses (including
reasonable attorneys' fees) arising under the Leases as a result of any
obligations and duties of the landlord thereunder arising prior to the Effective
Date. Notwithstanding the foregoing, to the extent that (a) Assignor would be
entitled under the IDA Lease (as defined in the Purchase Agreement) to pass
through any such liabilities, claims, damages, costs or expenses to the tenant
under the JDA Lease and/or (b) any such liabilities, claims, damages, costs or
expenses result from the acts or omissions of Assignee as tenant under the JDA
Lease, Assignor shall have no liability to Assignee under this Agreement.

         4.       INDEMNIFICATION BY ASSIGNEE. Assignee will indemnify, defend
and hold harmless Assignor and Assignor's employees, partners, directors,
officers, affiliates, subsidiaries, shareholders, agents and representatives
from any and all liabilities, claims, damages, costs or expenses (including
reasonable attorneys' fees) arising under the Leases as a result of any
obligations and duties of landlord thereunder arising on or after the Effective
Date.

         5.       SUCCESSORS AND ASSIGNS. This Assignment shall be binding upon
and inure to the benefit of the parties hereto and their successors and assigns.

         6.       AUTHORITY. Each of the parties signing this Assignment hereby
warrants and represents that it has the full legal power, authority and right to
execute, deliver and perform the obligations under this Assignment, that this
Assignment has been duly authorized by all requisite actions on the part of such
warranting party, and that no remaining action or third party action is required
to make this Assignment binding upon such party.

         7.       GOVERNING LAW. This Assignment shall be construed and enforced
in accordance with the laws of the State in which the Property is located.

         8.       ATTORNEYS' FEES. If either party commences litigation against
the other for the specific performance of this Assignment, the interpretation of
this Assignment, for damages for the breach hereof or otherwise for enforcement
of any remedy hereunder, the parties hereto agree, in the event of any such
commencement of litigation, the prevailing party shall be entitled to recover
from the other party such costs and reasonable attorneys' fees as may have been
incurred. Any attorneys' fees incurred in enforcing any right of indemnity set
forth in this Assignment shall be recoverable and deemed to be within the scope
of such indemnity and/or this attorneys' fees provision.

         9.       COUNTERPARTS. This Assignment may be executed in any number of
counterparts, each of which, when so executed and when delivered, shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.

                                       L-2


Assignor and Assignee have executed this Assignment as of the Effective Date.

                                        ASSIGNOR:

                                        OPUS REAL ESTATE ARIZONA II, L.L.C.

                                        By______________________________________

                                            Its_________________________________

                                        ASSIGNEE:

                                        JDA SOFTWARE GROUP, INC.

                                        By______________________________________

                                            Its_________________________________

                                       L-3


               EXHIBIT "A" TO ASSIGNMENT AND ASSUMPTION OF LEASES

                               (LEGAL DESCRIPTION)

PARCEL NO. 1:

Parcel 3, as shown on the Map of Dedication for Northsight II, according to Book
____________ of Maps, Page _______, Records of Maricopa County, Arizona, located
in a portion of Parcel 2 of the Map of Dedication for Northsight per Book 302 of
Maps, Page__________, Maricopa County Records and also a portion of the
Southeast Quarter of Section 12, Township 3 North, Range 4 East of the Gila and
Salt River Base and Meridian, Maricopa County, Arizona, more particularly
described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, as shown on said MAP OF DEDICATION FOR NORTHSIGHT, according to
Book 302 of Maps, Page 11 and Affidavit of Correction recorded as 87-0478660,
Official Records of Maricopa County, Arizona, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, as shown on said MAP OF DEDICATION FOR NORTHSIGHT a distance of
661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the Parcel herein described;

thence North 89 degrees 52 minutes 51 seconds West, leaving said Westerly
right-of-way line, a distance of 770.93 feet;

thence North 00 degrees 13 minutes 51 seconds West, a distance of 272.42 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 772.60 feet to
a point on said Westerly right of way of 87th Street;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly right of
way, a distance of 272.41 feet to the POINT OF BEGINNING of the Parcel herein
described.

PARCEL NO. 2:

A non-exclusive easement for ingress, egress and utilities as set forth in
Easement Agreement recorded September 6, 2000 in 00-687539.

PARCEL NO. 3:

Parcel 2, as shown on the Map of Dedication for Northsight II, according to
Book _________ of Maps,

                                       L-4


Page_______, Records of Maricopa County, Arizona, located in a portion of Parcel
2 of the Map of Dedication for Northsight per Book 302 of Maps, Page______,
Maricopa County Records and also a portion of the Southeast Quarter of Section
12, Township 3 North, Range 4 East of the Gila and Salt River Base and Meridian,
Maricopa County, Arizona, more particularly described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, a distance of 661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the parcel described herein;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly
right-of-way line, a distance of 148.03 feet to a point of curvature of a
tangent curve, concave Westerly, having a radius of 955.00 feet;

thence Southerly along the arc of said curve and said Westerly right-of-way
line, through a central angle of 22 degrees 46 minutes 21 seconds, 379.57 feet
to a point of non-tangency;

thence North 67 degrees 06 minutes 30 seconds West, a distance of 105.37 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 98.42 feet;

thence North 44 degrees 52 minutes 51 seconds West, a distance of 352.47 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 129.25 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 420.83 feet to
the POINT OF BEGINNING of the parcel described herein.

PARCEL NO. 4:

Easements as set forth in the Declaration of Covenants, Conditions and
Restrictions and Grant of Easements for Scottsdale NORTHSIGHT dated January 6,
2004 and recorded January 6, 2004 as Document No. 0012154 of Official Records of
Maricopa County, Arizona.

PARCEL NO. 5:

Easements as set forth in the Slope and Temporary Stock Pile, Staging and
Construction Easement Agreement dated June 23, 1998 and recorded June 26, 1998
as 98-546099 of Official

                                       L-5


Records, of Maricopa County, Arizona, as amended by that certain First Amendment
to Slope and Temporary Stockpile Staging and Construction Easement Agreement
recorded January 6, 2004 as Document No. 2004-0012151 of Official Records.

                                       L-6


               EXHIBIT "B" TO ASSIGNMENT AND ASSUMPTION OF LEASES

                              (SCHEDULE OF LEASES)

1.   Trapeze Software, Inc.

         a.   Lease dated August 26, 1999

         b.   Letter of Credit dated September 3, 2003

                  i.  Amendment to LOC dated September 11, 2003

                  ii. Amendment to LOC dated September 17, 2003

2.   JDA Software Group, Inc.

         a.   Lease dated April 30, 1998

         b.   First Amendment to Office Lease dated June 30, 1998

         c.   Second Amendment to Office Lease dated November 30, 1998

         d.   Letter Agreement dated October 6, 1999

         e.   Third Amendment to Office Lease dated October 8, 1999

         f.   Revised and Restated Third Amendment to Office Lease dated October
              20, 1999

         g.   Fourth Amendment to Office Lease dated May 30, 2001

         h.   Fifth Amendment to Office Lease dated May 31, 2001

         i.   Sixth Amendment to Office Lease dated August 31, 2003

         j.   Seventh Amendment to Office Lease dated June 30, 2003

3.   Voice Stream PCS III, Corporation

         a. Telecommunications License Agreement dated July 1, 2003

                                       L-1


                                    EXHIBIT M

          ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND PROJECT DOCUMENTS

         THIS ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND PROJECT DOCUMENTS
("Assignment") is made as of_________________, 2004 ("Effective Date"), by and
between OPUS REAL ESTATE ARIZONA II, L.L.C., a Delaware limited liability
company ("Assignor"), and JDA SOFTWARE GROUP, INC., a Delaware corporation
("Assignee").

                                    RECITALS:

         A.       Assignee has acquired from Assignor title to that certain real
property, and any improvements situated thereon owned by Assignor, more
particularly described on Exhibit "A" attached hereto ("Property").

         B.       In connection with the conveyance of the Property from
Assignor to Assignee, Assignor and Assignee intend and agree that Assignor's
right, title and interest in the agreements set forth on Exhibit "B" attached
hereto and all licenses, authorizations, approvals, permits, entitlements,
warranties, guaranties, approvals, certificates of occupancy, certificates,
surveys and reports, including, without limitation, any hazardous materials
reports, engineering and soils reports and any ALTA surveys, if any, in the
possession of Assignor, relating to the acquisition, construction, design, use,
operation, management or maintenance of the Property (collectively, the
"Contracts and Project Documents"), to the extent assignable, shall inure to the
benefit of and be assigned and transferred to Assignee.

                                   AGREEMENT:

         In consideration of the foregoing recitals and other good and valuable
consideration, Assignor and Assignee agree as follows:

         1.       ASSIGNMENT BY ASSIGNOR. To the extent assignable, Assignor
hereby assigns and transfers to Assignee all right, title and interest of
Assignor in the Contracts and Project Documents, together with any rights owned
by Assignor relating thereto. Notwithstanding the foregoing, Assignor reserves
the right to (a) enforce the provisions of the Contracts and Project Documents
in respect to all obligations or duties of the other party thereto that arose or
accrued prior to the Effective Date, and (b) exercise such rights under the
Contracts and Project Documents as are necessary in order for Assignor to
fulfill its obligations under the purchase agreement dated the Effective Date by
and between Assignor and Assignee relating to the Property ("Agreement"),
provided, however, in no event shall Assignor terminate any of the Contracts and
Project Documents as a result of Assignor's enforcement of such reserved rights.

         2.       LIMITED LICENSE. Assignor grants to Assignee a limited license
to use the plans and specifications relating to the construction of the
improvements on the Property in Assignor's possession for the purposes and
subject to the conditions and indemnifications as set forth in the Agreement.

                                       M-1


         3.       ACCEPTANCE OF ASSIGNMENT. Assignee hereby accepts the
assignment of the Contracts and Project Documents, and Assignee assumes and
agrees to keep, perform and fulfill all of the duties, covenants, provisions,
conditions and obligations of Assignor contained therein which arise or are
incurred or are related to events occurring from and after the Effective Date.

         4.       INDEMNIFICATION BY ASSIGNOR. Assignor will indemnify, defend
and hold harmless Assignee and Assignee's employees, partners, directors,
officers, affiliates, subsidiaries, shareholders, agents and representatives
from any and all liabilities, claims, demands, damages, losses, costs or
expenses (including reasonable attorneys' fees) arising under the Contracts and
Project Documents as a result of any obligations and duties of Assignor
thereunder arising or accruing prior to the Effective Date.

         5.       INDEMNIFICATION BY ASSIGNEE. Assignee will indemnify, defend
and hold harmless Assignor and Assignor's employees, partners, directors,
officers, affiliates, subsidiaries, shareholders, agents and representatives
from any and all liabilities, claims, demands, damages, losses, costs or
expenses (including reasonable attorneys' fees) arising under the Contracts and
Project Documents as a result of any obligations and duties of Assignor
thereunder arising or accruing from and after the Effective Date, except for
those matters described in Section 3 hereof which are Assignor's responsibility.

         6.       SUCCESSORS AND ASSIGNS. This Assignment shall be binding upon
and inure to the benefit of the parties hereto and their successors and assigns.

         7.       AUTHORITY. Each of the parties signing this Assignment hereby
warrants and represents that it has the full legal power, authority and right to
execute, deliver and perform the obligations under this Assignment, that this
Assignment has been duly authorized by all requisite actions on the part of such
warranting party, and that no remaining action or third party action is required
to make this Assignment binding upon such party.

         8.       GOVERNING LAW. This Assignment shall be construed and enforced
in accordance with the laws of the State in which the Property is located.

         9.       ATTORNEYS' Fees. If either party commences litigation against
the other for the specific performance of this Assignment, the interpretation of
this Assignment, for damages for the breach hereof or otherwise for enforcement
of any remedy hereunder, the parties hereto agree, in the event of any such
commencement of litigation, the prevailing party shall be entitled to recover
from the other party such costs and reasonable attorneys' fees as may have been
incurred. Any attorneys' fees incurred in enforcing any right of indemnity set
forth in this Assignment shall be recoverable and deemed to be within the scope
of such indemnity and/or this attorneys' fees provision.

         10.      COUNTERPARTS. This Assignment may be executed in any number of
counterparts, each of which, when so executed and when delivered, shall be an
original, but all such counterparts shall together constitute but one and the
same instrument.

                                       M-2


Assignor and Assignee have executed this Assignment as of the Effective Date.

                                        ASSIGNOR:
                                        OPUS REAL ESTATE ARIZONA II, L.L.C.

                                        By ____________________________________

                                           Its_________________________________

                                        ASSIGNEE:

                                        JDA SOFTWARE GROUP, INC.

                                        By ____________________________________

                                           Its_________________________________

                                       M-3


            EXHIBIT "A" TO ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND
                                PROJECT DOCUMENTS

                               (LEGAL DESCRIPTION)

PARCEL NO. 1:

Parcel 3, as shown on the Map of Dedication for Northsight II, according to Book
_________ of Maps, Page _____, Records of Maricopa County, Arizona, located in a
portion of Parcel 2 of the Map of Dedication for Northsight per Book 302 of
Maps, Page _______, Maricopa County Records and also a portion of the Southeast
Quarter of Section 12, Township 3 North, Range 4 East of the Gila and Salt River
Base and Meridian, Maricopa County, Arizona, more particularly described as
follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, as shown on said MAP OF DEDICATION FOR NORTHSIGHT, according to
Book 302 of Maps, Page 11 and Affidavit of Correction recorded as 87-0478660,
Official Records of Maricopa County, Arizona, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, as shown on said MAP OF DEDICATION FOR NORTHSIGHT a distance of
661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the Parcel herein described;

thence North 89 degrees 52 minutes 51 seconds West, leaving said Westerly
right-of-way line, a distance of 770.93 feet;

thence North 00 degrees 13 minutes 51 seconds West, a distance of 272.42 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 772.60 feet to
a point on said Westerly right of way of 87th Street;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly right of
way, a distance of 272.41 feet to the POINT OF BEGINNING of the Parcel herein
described.

PARCEL NO. 2:

A non-exclusive easement for ingress, egress and utilities as set forth in
Easement Agreement recorded September 6, 2000 in 00-687539.

PARCEL NO. 3:

                                       M-4


Parcel 2, as shown on the Map of Dedication for Northsight II, according to Book
_________ of Maps, Page ______, Records of Maricopa County, Arizona, located in
a portion of Parcel 2 of the Map of Dedication for Northsight per Book 302 of
Maps, Page ______, Maricopa County Records and also a portion of the Southeast
Quarter of Section 12, Township 3 North, Range 4 East of the Gila and Salt River
Base and Meridian, Maricopa County, Arizona, more particularly described as
follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, a distance of 661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the parcel described herein;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly
right-of-way line, a distance of 148.03 feet to a point of curvature of a
tangent curve, concave Westerly, having a radius of 955.00 feet;

thence Southerly along the arc of said curve and said Westerly right-of-way
line, through a central angle of 22 degrees 46 minutes 21 seconds, 379.57 feet
to a point of non-tangency;

thence North 67 degrees 06 minutes 30 seconds West, a distance of 105.37 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 98.42 feet;

thence North 44 degrees 52 minutes 51 seconds West, a distance of 352.47 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 129.25 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 420.83 feet to
the POINT OF BEGINNING of the parcel described herein.

PARCEL NO. 4:

Easements as set forth in the Declaration of Covenants, Conditions and
Restrictions and Grant of Easements for Scottsdale NORTHSIGHT dated January 6,
2004 and recorded January 6, 2004 as Document No. 0012154 of Official Records of
Maricopa County, Arizona.

PARCEL NO. 5:

Easements as set forth in the Slope and Temporary Stock Pile, Staging and
Construction

                                       M-5


Easement Agreement dated June 23, 1998 and recorded June 26, 1998 as 98-546099
of Official Records, of Maricopa County, Arizona, as amended by that certain
First Amendment to Slope and Temporary Stockpile Staging and Construction
Easement Agreement recorded January 6, 2004 as Document No. 2004-0012151 of
Official Records.

                                       M-6


        EXHIBIT "B" TO ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND PROJECT
                                    DOCUMENTS
                          (CERTAIN ASSIGNED AGREEMENTS)

SERVICE CONTRACTS:

                  1.

WARRANTIES:

                                       M-1


                                    EXHIBIT N

                     Revised Legal Description PARCEL NO. 1:

Parcel 3, as shown on the Map of Dedication for Northsight II, according to Book
________ of Maps, Page _______, Records of Maricopa County, Arizona, located in
a portion of Parcel 2 of the Map of Dedication for Northsight per Book 302 of
Maps, Page _____, Maricopa County Records and also a portion of the Southeast
Quarter of Section 12, Township 3 North, Range 4 East of the Gila and Salt River
Base and Meridian, Maricopa County, Arizona, more particularly described as
follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, as shown on said MAP OF DEDICATION FOR NORTHSIGHT, according to
Book 302 of Maps, Page 11 and Affidavit of Correction recorded as 87-0478660,
Official Records of Maricopa County, Arizona, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, as shown on said MAP OF DEDICATION FOR NORTHSIGHT a distance of
661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the Parcel herein described;

thence North 89 degrees 52 minutes 51 seconds West, leaving said Westerly
right-of-way line, a distance of 770.93 feet;

thence North 00 degrees 13 minutes 51 seconds West, a distance of 272.42 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 772.60 feet to
a point on said Westerly right of way of 87th Street;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly right of
way, a distance of 272.41 feet to the POINT OF BEGINNING of the Parcel herein
described.

PARCEL NO. 2:

A non-exclusive easement for ingress, egress and utilities as set forth in
Easement Agreement recorded September 6, 2000 in 00-687539.

PARCEL NO. 3:

Parcel 2, as shown on the Map of Dedication for Northsight II, according to Book
_______ of Maps, Page ______, Records of Maricopa County, Arizona, located in a
portion of Parcel 2 of the Map of

                                       M-1


Dedication for Northsight per Book 302 of Maps, Page __, Maricopa County Records
and also a portion of the Southeast Quarter of Section 12, Township 3 North,
Range 4 East of the Gila and Salt River Base and Meridian, Maricopa County,
Arizona, more particularly described as follows:

COMMENCING at the East quarter corner of said Section 12;

thence North 89 degrees 58 minutes 13 seconds West, along the monument line of
Raintree Drive, a distance of 660.08 feet;

thence South 00 degrees 07 minutes 09 seconds West, along the monument line of
87th Street, a distance of 661.93 feet;

thence North 89 degrees 52 minutes 51 seconds West, a distance of 45.00 feet to
a point on the Westerly right-of-way line of said 87th Street and also the POINT
OF BEGINNING of the parcel described herein;

thence South 00 degrees 07 minutes 09 seconds West, along said Westerly
right-of-way line, a distance of 148.03 feet to a point of curvature of a
tangent curve, concave Westerly, having a radius of 955.00 feet;

thence Southerly along the arc of said curve and said Westerly right-of-way
line, through a central angle of 22 degrees 46 minutes 21 seconds, 379.57 feet
to a point of non-tangency;

thence North 67 degrees 06 minutes 30 seconds West, a distance of 105.37 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 98.42 feet;

thence North 44 degrees 52 minutes 51 seconds West, a distance of 352.47 feet;

thence North 00 degrees 07 minutes 09 seconds East, a distance of 129.25 feet;

thence South 89 degrees 52 minutes 51 seconds East, a distance of 420.83 feet to
the POINT OF BEGINNING of the parcel described herein.

PARCEL NO. 4:

Easements as set forth in the Declaration of Covenants, Conditions and
Restrictions and Grant of Easements for Scottsdale NORTHSIGHT dated January 6,
2004 and recorded January 6, 2004 as Document No. 0012154 of Official Records of
Maricopa County, Arizona.

PARCEL NO. 5:

Easements as set forth in the Slope and Temporary Stock Pile, Staging and
Construction Easement Agreement dated June 23, 1998 and recorded June 26, 1998
as 98-546099 of Official Records, of Maricopa County, Arizona, as amended by
that certain First Amendment to Slope

                                       M-2


and Temporary Stockpile Staging and Construction Easement Agreement recorded
January 6, 2004 as Document No. 2004-0012151 of Official Records

                                       M-3

EX-10.14

                                                                   EXHIBIT 10.14

CONFIDENTIAL AND PROPRIETARY
                                                            Agreement No. 94151V

                     VALUE ADDED RESELLER LICENSE AGREEMENT
                              FOR UNIFACE SOFTWARE
                                  ("Agreement")

THIS AGREEMENT is between:

         JDA Software Group, Inc.
         14400 North 87th Street
         Scottsdale, AZ 85260-3649

hereafter "VAR" and Compuware Corporation, a Michigan corporation, with offices
+at 31440 Northwestern Highway, Farmington Hills, M1 48334, United States,
(hereafter "Compuware") effective April 1, 2000, ("Effective Date") and ending
March 31, 2005, ("Term"). This Term may be extended an additional three (3)
years upon mutual consent of VAR and Compuware.

[LOGO OF COMPUWARE]

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL

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CONFIDENTIAL AND PROPRIETARY

                                Table of Contents

                                                                           
I.       PARTIES............................................................   3

II.      SCOPE OF THIS AGREEMENT............................................   3

III.     DEFINITIONS........................................................   3

IV.      TERMS AND CONDITIONS...............................................   5

V.       ENTIRE AGREEMENT...................................................  19

VI.      EXHIBIT LIST.......................................................  20

VII.     EXHIBIT I. VAR PROFILE.............................................  21

IX.      EXHIBIT II. REMARKETERS LIST.......................................  24

X.       EXHIBIT III. COMPUWARE TRIAL AGREEMENT.............................  26

XI       EXHIBIT IV. VAR QUARTERLY ROYALTY REPORT...........................  27

XII.     EXHIBIT V. NON-DISCLOSURE AGREEMENT................................  28

XIII.    EXHIBIT VI. SAMPLE COMPUWARE LICENSE AGREEMENT AND
         PRODUCT SCHEDULE...................................................  31



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I.   PARTIES

     Compuware designs, develops and licenses computer programs and provides
     related services. VAR is a "value added reseller", as defined herein, of
     computer programs and related services. Each party represents that it is
     engaged in the business described herein and that it has all rights and
     authority to enter into this Agreement and undertake the obligations
     contained herein.

II.  SCOPE OF THIS AGREEMENT

     Subject to the terms and conditions of this Agreement, including the
     Exhibits referenced herein, Compuware agrees to license and provide, and
     VAR agrees to license UNIFACE Software and purchase services on a worldwide
     basis as defined herein during the term of this Agreement. Specifically,
     this Agreement grants VAR the right to incorporate into the VAR Application
     Software and distribute to its customers:

     -  UNIFACE Runtime
     -  Application Server
     -  Component Server
     -  Web Application Server
     -  Polyserver

This Agreement DOES NOT include right to distribute:

     -  UNIFACE Development Licenses
     -  General Use UNIFACE Runtime Licenses
     -  UNIFACE Mainframe Software

III. DEFINITIONS

     (a)  "Annual Maintenance Plan" means the Support Services described herein
          to be provided by Compuware to VAR for UNIFACE Software during a one
          year period.

     (b)  "VAR Application Software" means the specific computer software
          program developed by VAR using UNIFACE Software and containing UNIFACE
          Content as described in Exhibit 1. VAR Application Software includes
          Deployment Software.

     (c)  "UNIFACE Content" means software developed with the UNIFACE
          Development environment or containing elements of the UNIFACE runtime
          system. VAR software that meets the following criteria does not
          contain UNIFACE Content: (i) sold as a separate line item by VAR for
          use with VAR Application Software; (ii) does not use any UNIFACE data
          access mechanisms to access data; (iii) can execute without using any
          element of UNIFACE; (iv) can execute on a system on which UNIFACE is
          not installed; (v) does not access the UNIFACE meta dictionary; and
          (vi) was not built using the UNIFACE development environment.



CONFIDENTIAL AND PROPRIETARY

         (d)      "UNIFACE Software" means the object code version of the
                  Compuware software program "UNIFACE Application Development
                  and Deployment System", listed in Exhibit I, in such form,
                  version, release and content as initially licensed to VAR
                  under this Agreement including a copy of any user
                  documentation normally supplied by Compuware.

         (e)      "Deployment Software" means the object code, run-time portion
                  of UNIFACE Software incorporated in the VAR Application
                  Software.

         (f)      "Development Software" means the development portion of
                  UNIFACE Software to be accessed and used solely by the VAR
                  only to develop, maintain or modify the VAR Application
                  Software, including VAR Application Software development or
                  enhancements for specific End User installation requirements.

         (g)      "End User" means a VAR Application Software licensee.

         (h)      "Proprietary Information" means UNIFACE Software, VAR
                  Application Software and any other information (including
                  business information) confidential to Compuware or its
                  licensors, or confidential to VAR or its licensors which is
                  disclosed to Compuware by VAR or to VAR by Compuware.

         (i)      "Severity One Defect" means a defect exclusively within the
                  Deployment Software that causes the VAR Application Software
                  to: (i) fail to execute; (ii) malfunction in a manner that
                  adversely affects data integrity in the database or in the
                  reporting of data; or (iii) sustain a highly visible error
                  with no available workaround.

         (j)      "Support Services" as used herein means the standard Compuware
                  software maintenance services for UNIFACE Software, including
                  all copies of Development and Deployment Software. Such
                  Support Services are mandatory for UNIFACE Software licensed
                  to develop and support VAR Application Software and must be
                  procured on an annual bases. If VAR permanently discontinues
                  its use of a product it may elect to discontinue maintenance.

         (k)      "Royalties" means the monies due to Compuware for each license
                  of VAR Application Software as set forth in Exhibit I.

         (l)      "Sales and Marketing Purposes" means Deployment Software used
                  by VAR, its agents or distributors for sales, benchmarking, or
                  demonstrating the VAR Application Software. Said use shall be
                  limited to periods of up to 30 days per perspective End User.

         (m)      "Major Release" is a new version of UNIFACE Software as
                  defined by Compuware that includes new functionality.
                  Typically, a Major Release is indicated by a change in release
                  number to the right of the decimal point (i.e. the conversion
                  from UNIFACE 7.1 to 7.2).

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         (n)      "Maintenance Release" is a change made within one Major
                  Release that may contain bug fixes and/or improvements (e.g.,
                  from UNIFACE 6.1.d to UNIFACE 6.1 .e; from UNIFACE 7.1.01 to
                  7.1.02, etc.).

IV.      TERMS AND CONDITIONS

         1.       Value Added Reseller License

         (a)      Compuware grants VAR a non-exclusive, non-transferable license
                  to use UNIFACE Software only to market, develop and deploy VAR
                  Application Software upon the terms and conditions herein
                  contained on the platforms and in the operating environments
                  at the location identified on Exhibit I and in Product
                  Schedule(s). Such license for marketing will be limited for
                  use by VAR, its contractors, agents and distributors for Sales
                  and Marketing Purposes. Such license for development will be
                  limited for use by JDA employees or contractors to develop,
                  modify, enhance and maintain the VAR Application Software
                  defined in Exhibit I. Such license for deployment will be
                  limited to an authorized market and territory assignment as
                  defined in Exhibit I. Except as expressly hereby authorized,
                  VAR is not licensed by this Agreement to use the UNIFACE
                  Software for any other purpose. VAR agrees to maintain
                  sufficient development licenses to meet peak usage
                  requirements, such that at no time are there more development
                  licenses installed on VARs, VAR's contractors, or VAR's agents
                  machines than have been purchased by VAR.

                  (b)      The parties hereby agree and undertake at all times
                  during the term of this Agreement:

                  -        conduct business in a businesslike manner and not
                           engage in deceptive, misleading, illegal or unethical
                           business practices.

                  -        VAR will accurately represent the VAR Application
                           Software in terms of function and performance;

                  -        VAR will market the VAR Application Software only
                           pursuant to terms which are consistent with the terms
                           of this Agreement;

                  -        not make any representations, warranties or
                           guarantees that are inconsistent with or in addition
                           to those made in this Agreement;

                  -        VAR will provide End Users with technical and
                           maintenance support;

                  -        notify the other party immediately of any legal or
                           other notices which come to such party's knowledge
                           and which may potentially affect the other party, its
                           licensors and/or vendors and,

                  -        VAR will promptly respond to any verified complaints
                           regarding VAR Application Software received from its
                           End Users.

         (c)      By paying the fees then in effect, minus applicable discounts,
                  the UNIFACE Software may be licensed for use on qualified
                  alternate platforms and in additional operating environments.

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         (d)      Title to UNIFACE Software will remain with Compuware. VAR will
                  acquire no rights to any UNIFACE Software, except to the
                  extent VAR acquires the right to use the UNIFACE Software to
                  market, develop and deploy VAR Application Software.

         (e)      Title to VAR Application Software will remain with VAR.
                  Compuware will acquire no rights to any VAR Application
                  Software.

         (f)      Except for subsidiaries that are at least fifty-one percent
                  (51%) owned or controlled by VAR, VAR shall not assign or
                  transfer its rights in, or obligations under, this Agreement
                  without the prior written consent of Compuware. In the event
                  of the sale of all or substantially all of VAR's assets,
                  Compuware will allow the new entity to license the UNIFACE
                  Software under substantially the same terms contained herein
                  at the then current published license fee, less the previously
                  paid license fees for the UNIFACE Software licensed to VAR.
                  Compuware reserves the right to withhold this option if the
                  new entity is a direct competitor of Compuware, an entity with
                  which Compuware is involved in litigation, or an entity with
                  which Compuware has encountered a previous incidence of
                  intellectual property right infringement. Any assignment or
                  transfer prohibited by this provision will be void.

         (g)      In no event is VAR authorized hereunder to enter into an
                  agreement with others to distribute, remarket or otherwise
                  sub-license VAR Application Software, other than those
                  distributors identified in Exhibit II, without the prior,
                  written consent of Compuware, which shall not be unreasonably
                  withheld. Any such agreement with others shall be limited to
                  the distribution of VAR Application Software and shall contain
                  no other rights or provisions that may jeopardize the
                  intellectual property rights of Compuware.

         (h)      The VAR Application Software shall not contain Development
                  Software, and nothing in this Agreement shall authorize, grant
                  or otherwise permit the transfer or disclosure of Development
                  Software by VAR to others.

         (i)      VAR shall observe all applicable laws and regulations in
                  respect of and obtain all necessary licenses, consents and
                  permissions required for the marketing and license of VAR
                  Application Software, (including without limitation, the U.S.
                  Export Administration Regulations and U.S. Department of
                  Commerce Regulations and EU dual use legislation and local
                  import and export regulations regarding the export or transfer
                  of goods), and VAR shall provide Compuware with all
                  information reasonably necessary to ensure that the UNIFACE
                  Software complies with local laws and regulations and promptly
                  advise Compuware of any change or proposed change in such laws
                  and regulations known to VAR.

         (j)      VAR and Compuware may modify the Market and Territory
                  Assignment set out in Exhibit I by prior written agreement.

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         (k)      VAR acknowledges that each copy of UNIFACE Software and the
                  Deployment Software included in VAR Application Software
                  licensed to an End-User will require a software enabling key
                  ("SEK") that will be issued by Compuware upon receipt of: (i)
                  name and address of End-User, (ii) description of products,
                  (iii) Royalty, and (iv) description of the End-User's
                  infrastructure (i.e. Platforms, databases, etc.).

         (l)      VAR shall include in the VAR Application Software and on the
                  exterior label of every media, a copyright notice in this
                  form: "Portions of this program, Copyright 199___, Compuware,
                  All Rights Reserved." In cases where the VAR Application
                  Software is contained in Read-Only-Memory (ROM) chips, a
                  copyright notice in the form listed above, must be displayed
                  on the exterior of the chip and internally in the chip in
                  ASCII literal form.

         (m)      In order to ensure that VAR will be capable of providing
                  support to End Users and as a condition to the right of VAR to
                  grant sublicenses to End Users pursuant to the terms of this
                  Agreement, VAR agrees that, with respect to each qualified
                  hardware, platform and operating system configuration set
                  forth on Exhibit I for which VAR intends to grant a
                  sublicense, VAR shall purchase a license from Compuware for
                  use of the UNIFACE Software on such designated platform and
                  configurations in the quantities required by VAR to develop
                  deploy, maintain and support VAR Application Software, shall
                  install the UNIFACE Software on such designated platforms and
                  configuration and shall obtain and maintain the Support
                  Services for such UNIFACE Software.

         (n)      VAR shall have the right to use VAR Application Software
                  incorporating the Deployment Software, without incurring any
                  obligation to pay royalties to Compuware in respect thereof,
                  for Sales and Marketing Purposes.

         (o)      VAR may deliver copies of the VAR Application Software to a
                  prospective End User on a trial basis for evaluation purposes
                  only after such prospective End User has signed a trial
                  license with provisions comparable to those contained in the
                  Compuware Trial Agreement, a copy of which is attached as
                  Exhibit III hereto. All such evaluation copies of the VAR
                  Application Software installed by VAR at a prospective End
                  User's site shall be removed by VAR upon completion of the
                  evaluation period. Any evaluation copies not removed and
                  returned to VAR at the end of the evaluation period, which
                  includes any extension of such evaluation period, are deemed
                  to be licensed, and royalties and related maintenance and
                  support fees in respect thereof shall become immediately due
                  to Compuware.

         (p)      Compuware reserves the right to License, support, install and
                  service its products, including without limitation UNIFACE
                  Software, either directly to End Users or through other VAR's,
                  representatives, distributors or other distribution channels.
                  VAR hereby acknowledges that Compuware may independently
                  develop, or have developed for it, sell and market either
                  directly or indirectly, products similar to the VAR
                  Application Software and

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                  nothing herein shall be deemed to give VAR an exclusive right
                  to develop or sell products similar to the VAR Application
                  Software. Notwithstanding anything in this Agreement to the
                  contrary, Compuware shall not market or license Deployment
                  Software to End Users for incorporation into VAR Application
                  Software. If Compuware does market Deployment Software to End
                  Users for incorporation into VAR Application Software, VAR
                  will not owe Compuware the applicable royalty for the VAR
                  Application Software that VAR licensed to such End User.

         (q)      VAR shall maintain accurate books and records of all dealings
                  under this Agreement including any licensing of UNIFACE
                  Software and VAR Application Software and the furnishing of
                  support services; Such books and records shall be prepared and
                  maintained in a manner that will reasonably facilitate
                  Compuware's verification of each report prepared by VAR. Such
                  books and records shall be kept and maintained by VAR during
                  the term of this Agreement and for a period of not less than
                  three years from the date of the transaction. If this
                  Agreement is terminated, VAR shall transfer copies of all such
                  books and records to Compuware within a period of thirty (30)
                  days of such termination upon Compuware's written request.

         (r)      VAR agrees to provide to Compuware a quarterly report setting
                  out the licensing and services furnished under the Agreement
                  including a reconciliation of royalties due Compuware in a
                  form substantially in the form of Exhibit IV. Such report
                  shall be submitted to Compuware no later than thirty (30) days
                  after the end of each calendar quarter in which this Agreement
                  is in effect.

                  In addition, VAR agrees to provide to Compuware a report of
                  each installation of VAR Application Software that report
                  shall include details of End Users (a purchase order that
                  includes End User name and address, description of products,
                  and description of infrastructure, i.e. platforms, databases,
                  etc.). Such report shall be submitted to Compuware upon the
                  installation and/or the license of the VAR Application
                  Software of the End User, whichever occurs sooner.

         (s)      Compuware shall have the right, not more than once during each
                  of VAR's fiscal years, on reasonable notice and during normal
                  business hours to visit and inspect VAR's place of business
                  and applicable sales records to attempt to verify VAR's
                  compliance with its obligations under this Agreement.
                  Additionally, VAR agrees that Compuware shall have the right
                  to have VAR's books and records of sales audited by an
                  independent auditor of Compuware's choice not more than once
                  during each of VAR's fiscal years, but not during the months
                  of January or February. Such auditor's fees shall be borne by
                  Compuware, unless such audit shows an underpayment of
                  royalties of 5% or more of the royalties actually owing for
                  the period in question, in which event, the auditor's fees
                  shall be paid by VAR.

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         2.       Sublicense of Deployment Software

         (a)      VAR agrees to use, market and sublicense the Deployment
                  Software solely and exclusively as part of the VAR Application
                  Software for the exclusive use by its End Users on supported
                  UNIFACE Software platforms.

         (b)      VAR will distribute the Deployment Software as incorporated in
                  the VAR Application Software to End Users only after VAR and
                  such End Users have entered into a software license agreement
                  containing substantially the following terms:

                  (i)      End User will not adapt, translate, decompile,
                           disassemble or create derivative works unless End
                           User licenses Source Code from VAR, in which case,
                           VAR shall 1) notify Compuware of End User's source
                           code license, 2) pay Compuware a royalty rate of
                           seven percent (7%) of the source code license fee,
                           and 3) VAR will require End User to license
                           appropriate number of Development Licenses.

                  (ii)     End User will not sublicense, rent, lease or
                           otherwise assign or transfer this Agreement or the
                           VAR Application Software. Notwithstanding the
                           foregoing, the End User can be permitted to assign or
                           transfer the license for "the VAR Application
                           Software provided that (i) Compuware receives advance
                           written notification, and (ii) the assignee or
                           transferee agrees in writing to be fully bound by the
                           terms and conditions of the software license
                           agreement. Variance with these terms will result in
                           the automatic termination of End User's license;

                  (iii)    End User may make a reasonable number of copies
                           necessary to exercise their license grants. End User
                           shall reproduce and include the copyright notice of
                           VAR and Compuware on any copy of the VAR Application
                           Software;

                  (v)      End User acknowledges and understands that portions
                           of the VAR Application Software are licensed to VAR
                           by Compuware;

                  (vi)     The copyright and other intellectual property rights
                           in the VAR Application Software except for the
                           Deployment Software are and at all times shall remain
                           the property of VAR or its licensors and End Users
                           agrees that the Application Software is for internal
                           data processing purposes of End Users and agrees not
                           to copy nor disclose the VAR Application Software to
                           others.

                  (vii)    Compuware regards the UNIFACE Software as proprietary
                           information and as trade secrets. End User agrees to
                           hold such proprietary information or trade secrets in
                           strictest confidence, not to disclose it to any third
                           party and to exercise the same degree of care (but no
                           less than reasonable care) to safeguard the

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                           confidentiality of such information as End User would
                           exercise to safeguard its own proprietary information
                           of a similar nature.

                  (viii)   End User agrees that Compuware shall have the right,
                           as an intended third-party beneficiary of this
                           Agreement, to rely upon and directly enforce the
                           terms set forth in this Agreement.

         (c)      VAR will offer to provide End-User with ongoing support
                  service.

         3.       Orders, Delivery And Acceptance

         (a)      All orders for Development Software issued by VAR will be in
                  writing on a Product Schedule, will refer to and be subject to
                  the terms and conditions of this Agreement, the Product
                  Schedule and any Exhibits, and will be forwarded to the
                  Compuware managing office at the address set forth in Exhibit
                  I. Any additional terms and conditions contained on any
                  purchase order or other VAR order document are of no force or
                  effect, and Compuware hereby gives notice of objection to such
                  additional terms. Orders will bind Compuware only when
                  accepted by written confirmation

         (b)      The UNIFACE Software described in the Product Schedule(s) will
                  be deemed accepted by VAR upon VAR's execution of the Product
                  Schedule(s) or upon VAR's use of the UNIFACE Software,
                  whichever is earlier.

         (c)      Compuware will package and ship UNIFACE Software in accordance
                  with its standard practices. Shipment will be by means
                  selected by Compuware. Risk of loss and damage will pass to
                  VAR upon delivery to VAR's location.

         4.       Fees and Royalties

         (a)      Royalties. In consideration of the rights granted herein, VAR
                  agrees to pay Compuware the license fees for the UNIFACE
                  Software as set out in Exhibit I and royalties for each copy
                  of VAR Application Software as set out in Exhibit I licensed
                  to use or accessed by an End User (except for evaluation
                  copies under Section IV.1(o), whether or not VAR has received
                  payment from End User. The royalties will be calculated as set
                  forth in Exhibit I and payable under the terms of this
                  Agreement.

         (b)      Support Services Fees for UNIFACE Software and VAR Application
                  Software. VAR agrees to pay annual Support Services fees on
                  UNIFACE Software and Deployment Software by paying in advance
                  the Support Services fees set forth in Exhibit I.

         5.       Payment Terms

         (a)      Payment of License Fees and Support Services Fees. Invoices
                  will be issued by Compuware upon execution of the Agreement
                  and subsequent Product Schedules for all UNIFACE Software and
                  for Support Services.

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                  Support Service fees renew annually after the initial period.
                  Payment terms are net thirty (30) days from the date of
                  invoice and payable in US dollars.

         (b)      Payment of Royalties and Support Services Fees. VAR shall pay
                  royalties and Support Services fees due Compuware within
                  thirty (30) days after the end of each month in which fees for
                  such royalties or End Users support fees were recognized.
                  Royalty and Support Services payments shall be made to
                  Compuware in US dollars.

         (c)      Compuware may impose a late payment charge on all undisputed
                  unpaid fees and royalties equal to the lesser of (i) 1% per
                  month of the outstanding amount due or (ii) the maximum rate
                  allowed by law. If VAR becomes delinquent in the payment of
                  any amount due, Compuware may, among other remedies available
                  at law or in equity, suspend performance under this Agreement.

         (d)      If Compuware fails to remedy Severity One Defects in the
                  UNIFACE Software within a commercially reasonable period, VAR
                  may, among other remedies available at law or in equity under
                  this Agreement, with regard to those End Users who are under a
                  current maintenance program and are experiencing the Severity
                  One Defects problem:

                      (i)      suspend performance;

                      (ii)     cease to pay maintenance; and

                      (iii)    apply one of the following remedies with respect
                               to each End User experiencing the Severity One
                               Defects:

                           a)       withhold payment to Compuware in an amount
                                    equal to UNIFACE Software royalties paid by
                                    such Severity One experiencing End User; or

                           b)       receive a credit of royalty for the Severity
                                    One experiencing End User where VAR issues a
                                    credit as a result of Severity One Defects.

         (e)      If Compuware fails to release a Major Release within 24 months
                  of the previous Major Release, the then current royalty rate
                  shall decrease (0.5%) for each year thereafter in which a
                  Major Release is not released ("Adjustment"). If Compuware has
                  not issued a Major Release within 24 months during a prepay
                  royalty period, the prepaid royalty rate will remain in effect
                  with the Adjustment after the expiration of the pre-paid
                  royalty period, until such time that a Major Release is
                  issued. At such time, the royalty rate will revert to the rate
                  specified in Exhibit I (the non-prepay royalty rate) or JDA
                  may elect to make an additional pre-payment at that time to
                  reinstate the 7% rate. Compuware will provide a credit to JDA
                  towards future royalties equivalent to the amount JDA would
                  have paid if no Adjustment(s) were made, less what JDA
                  actually paid with the Adjustment(s).

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         6.       Support and Obligations Of VAR

         (a)      As between Compuware and VAR, VAR shall be responsible for
                  first line support to End Users of the VAR Application
                  Software, whether or not VAR charges End User(s) for support.
                  VAR shall provide End Users on support for which maintenance
                  service was paid with (i) first line technical support by
                  maintaining a qualified support group, (ii) a service to
                  ascertain the nature of problems an End-User may be
                  experiencing and correct such problems, and (iii) other
                  related maintenance services.

         (b)      Annual Maintenance Plan services and fees are mandatory for
                  both UNIFACE Software and for Deployment Software for the
                  first year. Thereafter, VAR shall pay Compuware maintenance
                  for each Deployment Software for which it assesses maintenance
                  fees. Annual Maintenance Plan fees are set out in Exhibit I
                  and are payable annually in advance. If an Annual Maintenance
                  Plan is not continued, no support will be provided, including
                  providing of enhancements, new releases, or fixes and a new
                  version of ODBMS would require a royalty payment based on the
                  license fee charged by VAR.

         7.       Obligations Of Compuware

         (a)      Compuware will make available upon request, with reasonable
                  notice, to VAR's sales and technical staff sales collateral
                  materials as reasonably required regarding UNIFACE Software,
                  to use. Compuware will also make available upon request, with
                  reasonable notice, and at the expense of VAR, training
                  services. The type and cost for such training will be as
                  specified in a Product Schedule.

         (b)      VAR will be entitled to the following services from Compuware:

                  -        the supply of any available Maintenance Release
                           and/or updates of the appropriate UNIFACE Software;

                  -        user documentation on payment of a charge for the
                           media, transportation and handling charges involved;

                  -        copies of Compuware's technical bulletin normally
                           furnished by Compuware to customers as and when the
                           same are published by Compuware;

                  -        non-exclusive access to technical hotline support
                           from Compuware

         (c)      The technical hotline is only for use by employees or
                  contractors of VAR who received training in the use of UNIFACE
                  Software. VAR agrees to have at all times a staff of a minimum
                  of two (2) persons who received such training. The technical
                  hotline will only be used to resolve problems stemming from
                  the demonstrable failure of the UNIFACE Software to work in
                  accordance with Compuware user manuals as updated from time to
                  time. Any other use of the technical hotline by VAR will be
                  chargeable by

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                  Compuware in accordance with Compuware's normal practice and
                  payable by VAR within thirty (30) days of the date of
                  Compuware's invoice therefor.

         (d)      VAR acknowledges that the technical hotline is not for use by
                  End Users and shall not permit any End User to make direct use
                  of the technical hotline.

         (e)      Compuware will provide VAR with (i) a reasonable quantity of
                  brochures and other sales promotion material at no charge and
                  (ii) periodic marketing communications and updates regarding
                  the UNIFACE Software. At VAR's request, Compuware will furnish
                  additional copies of any available non-proprietary materials
                  regarding the UNIFACE Software at Compuware's then current
                  cost.

         (f)      Additional products and services are available from Compuware
                  at Compuware's then current rates and terms.

         8.       Warranties And Disclaimers

         (a)      Compuware warrants that UNIFACE Software delivered by
                  Compuware to VAR will operate on designated platforms in
                  substantial accordance with the specifications set forth in
                  Compuware user manuals.

         (b)      This warranty does not apply to any UNIFACE Software that: (i)
                  has been altered; (ii) has not been handled, installed,
                  maintained, or operated in substantial accordance with
                  Compuware instructions; or (iii) has been damaged by accident,
                  misuse, negligence, or external factors.

         (c)      Compuware warrants that any services furnished by it pursuant
                  to this Agreement will be performed with reasonable skill and
                  care consistent with industry standards.

         (d)      Compuware warrants that it has all right, title and interest
                  in the UNIFACE Software necessary to grant the rights
                  contained herein.

         (e)      YEAR 2000 WARRANTY:

                  Provided payment for maintenance is current and Licensee has
                  installed the latest available Software release, Compuware
                  warrants that all new releases of the Software licensed
                  hereunder, marketed as "Year 2000 Compliant" and made
                  generally available after July 1, 1998 are enabled to process
                  post year 2000 dates. Specifically, Compuware defines year
                  2000 compliant as the Software being functional in a post year
                  2000 environment and will perform substantially as stated in
                  the Software documentation. Compuware Software may display
                  dates in either 2 or 4 digit year formats. If 2 digit year
                  displays are used, it will be clearly evident to the Software
                  user, based on Software function and documentation, that the 2
                  digit "00" represents the year 2000. When required, Software
                  will either process with 4 digit years and/or implement

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                  century windowing techniques to handle and process post year
                  2000 dates.

                  The above Year 2000 warranty shall be incorporated into the
                  Agreement and subject to all terms, conditions, restrictions
                  and limitations contained therein including, but not limited
                  to the Limitation of Liabilities and Indemnification.

         (f)      VIRUS: Compuware warrants that it has taken reasonable steps
                  to test any Software delivered hereunder for Computer Virus
                  and that the Software is free of Computer Viruses as of the
                  date of delivery by Compuware and that Compuware will continue
                  to take such steps with respect to future enhancements or
                  modifications to the Software. "Computer Virus" is defined as
                  computer instructions that alter, destroy or inhibit the
                  Software and/or Licensee's processing environment, including,
                  but not limited to, other programs that self-replicate without
                  manual intervention, instructions programmed to activate at a
                  predetermined time or upon a specific event, and/or programs
                  purporting to do a meaningful function but designed for a
                  different function. Compuware will maintain a master copy of
                  each version of the Software, to the best of Compuware's
                  knowledge to be free and clear of any Computer Virus.

         (g)     VAR is relying on its own skill and judgment in relation to the
                 UNIFACE Software irrespective of any knowledge it or its
                 servants or agents may possess as to the purpose for which the
                 UNIFACE Software is supplied and Compuware makes no warranty
                 that the UNIFACE Software will meet VAR's requirements or those
                 of any End User.

         (h)      Notwithstanding the foregoing, Compuware makes no warranty
                  that operation of the UNIFACE Software will be uninterrupted
                  or error-free, nor that the UNIFACE Software will be
                  compatible with and/or work in conjunction with any VAR
                  Application Software or any other software or hardware.

         (i)      EXCEPT AS EXPRESSLY STATED IN THIS AGREEMENT, THERE ARE NO
                  WARRANTIES, EXPRESS OR IMPLIED, BY OPERATION OF LAW OR
                  OTHERWISE, AND ALL SOFTWARE, SERVICES AND OTHER ITEMS ARE
                  PROVIDED "AS IS" WITHOUT WARRANTY OF ANY KIND. COMPUWARE
                  DISCLAIMS THE IMPLIED WARRANTIES OF MERCHANTABILITY AND
                  FITNESS FOR A PARTICULAR PURPOSE AS TO BOTH COMPUWARE AND
                  NON-COMPUWARE PRODUCTS. ANY WARRANTIES MADE TO VAR UNDER THIS
                  AGREEMENT EXTEND SOLELY TO VAR.

         9.       Limitations Of Liability And Indemnification

         (a)      VAR's sole and exclusive remedies for damages from any cause
                  related to or arising out of this Agreement whether, based on
                  negligence, breach of contract, warranty or other legal
                  theory, will be those provided in this Agreement.

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         (b)      IN NO EVENT WILL EITHER PARTY BE LIABLE FOR: (I) ANY
                  INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES
                  INCLUDING, BUT NOT LIMITED TO, LOSS OF USE, LOSS OF GOODWILL
                  OR THE DIMINUTION IN THE VALUE OF VAR'S BUSINESS, REVENUES,
                  PROFITS OR SAVINGS; OR (II) CLAIMS DEMANDS OR ACTIONS AGAINST
                  THE OTHER PARTY BY ANY PERSONS, EXCEPT AS PROVIDED IN SECTION
                  10, AND COMPUWARE'S RIGHT TO COLLECT LICENSE FEE'S OR REVENUE
                  DUE TO UNAUTHORIZED USE OF UNIFACE SOFTWARE. EXCEPT FOR CLAIMS
                  ARISING OUT OF EACH PARTY'S OBLIGATIONS UNDER SECTION 10,
                  VAR'S MISUSE OF COMPUWARE'S UNIFACE SOFTWARE, OR VAR'S
                  VIOLATION OF SECTION 12(A): CONFIDENTIALITY OF UNIFACE,
                  NEITHER PARTY'S LIABILITY FOR ANY AND ALL CAUSES, WHETHER
                  BASED ON NEGLIGENCE, BREACH OF CONTRACT, WARRANTY OR OTHER
                  LEGAL THEORY, SHALL EXCEED CHARGES PAID BY VAR TO COMPUWARE
                  FOR THE UNIFACE SOFTWARE THAT IS THE SUBJECT MATTER OF THE
                  CAUSE OF ACTION ASSERTED DURING THE TWENTY-FOUR (24) MONTH
                  PERIOD IMMEDIATELY PRECEDING NOTICE TO THE OTHER PARTY OF SUCH
                  CLAIM OR CAUSE.

         (c)      Each party acknowledges that any breach of its obligations
                  with respect to proprietary rights of the other party may
                  cause such party irreparable injury for which there are
                  inadequate remedies at law and that Compuware shall be
                  entitled to seek equitable relief in addition to all other
                  remedies available to it.

         (d)      Except for the remedies provided to VAR in this Agreement, and
                  subject to the limitations set forth in 9(b), and provided
                  Compuware provides VAR with prompt written notice, reasonable
                  assistance, and authority to defend or settle all non-UNIFACE
                  product or intellectual property right disputes, VAR will
                  indemnify and hold Compuware harmless against any claims,
                  costs, damages and liabilities arising out of or in any way
                  connected with: (i) any breach of this Agreement by VAR, its
                  employees or agents; and (ii) any claim by End Users or other
                  third parties with respect to VAR's products (excluding claims
                  based exclusively upon UNIFACE components independent of their
                  use with VAR Application Software) or other non-Compuware
                  products provided, recommended or referred by VAR. Such
                  indemnification will include all reasonable legal fees and
                  other costs incurred by Compuware in defending any such
                  claims. Termination or cancellation of this Agreement will not
                  affect VAR's indemnification obligations.

         (e)      Compuware software licensors shall have no liability with
                  respect to any claim of VAR or a third party on account of,
                  resulting from, or arising out of the use of any software,
                  services or products provided by such licensor or derived from
                  such licensor's software. Compuware software licensors shall
                  have no obligation to furnish any assistance, information or
                  documentation with respect to any software, services or
                  products.

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         (f)      Any legal proceeding, regardless of form, arising out of this
                  Agreement must be commenced within two (2) years after the
                  cause of action first occurs or shall forever thereafter be
                  barred.

         10.      Patent, Copyright and Trade Secret Indemnification

         (a)      Compuware, at its own expense, will defend VAR against claims
                  that the UNIFACE Software furnished under this Agreement
                  infringe upon any patent, copyright, trade secret or other
                  intellectual property rights, provided VAR; (i) gives
                  Compuware prompt written notice of such claims pursuant to
                  Section 14(g), (ii) permits Compuware to defend or settle the
                  claims, and (iii) provides all reasonable assistance to
                  Compuware in defending or settling the claims. Termination or
                  cancellation of this Agreement will not affect Compuware's
                  indemnification obligations.

         (b)      Compuware shall have no obligation for or with respect to
                  claims, actions, or demands alleging infringement by VAR
                  Application Software based on any of the following:

                  -        unauthorized modification of the UNIFACE Software;

                  -        a Major Release of the UNIFACE Software other than
                           the current or one prior Major Release if the current
                           or prior Major Release would be non-infringing;

                  -        use of the UNIFACE Software in combination with
                           non-Compuware programs;

                  -        third party-software which form part of, or is
                           bundled with, the UNIFACE Software.

         (c)      As to any UNIFACE Software which is in and of itself, in the
                  opinion of Compuware, subject to a claim of infringement or
                  misappropriation, Compuware may elect to; (i) obtain the right
                  of continued use and remarketing of the UNIFACE Software for
                  VAR as provided under this Agreement, or (ii) replace or
                  modify such UNIFACE Software to avoid such claim. If neither
                  alternative is, in the opinion of Compuware, available on
                  commercially reasonable terms and costs, then any applicable
                  license to VAR will terminate and Compuware will provide a
                  refund of the applicable royalty percentage rate equal to the
                  percentage of the VAR Application License Fee VAR refunds to
                  End User as determined by its negotiated End User agreements.

         (d)      Compuware will not defend or indemnify VAR and shall have no
                  liability or responsibility for any claim of infringement or
                  misappropriation asserted by a parent or subsidiary of VAR.

         (e)      This Section 10 states the entire liability of Compuware and
                  VAR's sole and exclusive remedies for patent or copyright
                  infringement and trade secret misappropriation.

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         11.      Trademarks And Trade Names; Advertising

         (a)      As a value added reseller, VAR shall have the right to use the
                  legend "UNIFACE Software Valued Added Reseller - Compuware
                  Corporation" in advertising, correspondence, proposals or
                  other materials provided that such legend appears in type
                  smaller and less prominent than VAR's own name or mark.

         (b)      Compuware may provide VAR with formats for use by VAR in
                  advertising and promoting the VAR Application Software. In
                  using the formats, VAR will comply with all related
                  instructions provided by Compuware. In addition, Compuware
                  will provide VAR with written guidelines to assist VAR in
                  developing other advertising and promotional programs and
                  materials. All such programs and materials must be submitted
                  to and approved in writing by Compuware (except as to price
                  and terms of sale VAR intends to offer) before use.

         (c)      No right or license is granted by Compuware to VAR to use
                  Compuware trademarks or trade names except as they appear on
                  VAR Application Software marketed by VAR or as authorized by
                  Compuware. VAR will not affix any Compuware trademarks, logos
                  or trade names to any software and will not disturb any
                  legend, notice, label, or designation of any Compuware
                  trademark, logo or trade name.

         12.      Protection Of Proprietary Information

         (a)      VAR information that has not been released publicly and
                  considered to be confidential will be treated in accordance
                  with the terms and conditions of the Non-Disclosure Agreement
                  set out in Exhibit V. The parties will keep in confidence and
                  protect Proprietary Information of the other party from
                  disclosure to third parties and use Proprietary Information
                  only for the purpose of performing under this Agreement. Each
                  party acknowledges that unauthorized disclosure of Proprietary
                  Information may cause substantial economic loss to the
                  non-disclosing party or its licensors. Each party will inform
                  its employees of their obligations under this Section 12 and
                  instruct them so as to insure such obligations are met. This
                  Section 12 will not be construed to grant to either party any
                  license or other rights in the other party's Proprietary
                  Information, except as expressly set forth in this Section.
                  Upon termination or cancellation of this Agreement, Each party
                  will destroy (and, in writing, certify destruction) or return
                  to the other party all copies of the other party's Proprietary
                  Information in such party's possession. VAR's obligations
                  under this Section 12 will survive termination or cancellation
                  of this Agreement.

         13.      Term, Termination and Cancellation

         (a)      This Agreement will begin on the Effective Date, specified on
                  the first page of this Agreement, and continue in effect to
                  the stated Termination

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                  Date, unless extended in accordance with Exhibit I, or
                  canceled or terminated as provided below.

         (b)      Except as provided in Sections 13(d) if either party
                  materially breaches this Agreement, the other may cancel it
                  upon 30 days written notice unless the breach is cured within
                  the notice period.

         (c)      Compuware may cancel this Agreement at any time upon written
                  notice, without providing VAR with any opportunity to cure, if
                  VAR breaches any of its obligations under Sections IV. 1, or
                  IV. 12 or if VAR

                  -        enters into liquidation whether compulsory or
                           voluntarily otherwise than for the purpose of
                           amalgamation or reconstruction without insolvency;

                  -        compound or make any arrangement with creditors;

                  -        have a receiver or manager appointed in respect of
                           any or any part of its assets; or

                  -        be the subject of any application for an
                           administration order.

         (d)      Orders outstanding on the effective date of termination or
                  cancellation will be subject, at the reasonable discretion of
                  Compuware, to acceptance, rejection or performance as if this
                  Agreement remained in force. Payment terms for orders accepted
                  after the date of notice of termination or cancellation will
                  be as specified by Compuware.

         (e)      Upon the effective date of termination or cancellation VAR
                  will pay Compuware for all undisputed UNIFACE Software,
                  Royalties, and Support Services irrespective of the date of
                  delivery, and all other undisputed amounts then owed
                  Compuware. VAR will also discontinue use of its designation as
                  a value added reseller of Compuware.

         (f)      No damages (whether direct, consequential, special or
                  incidental and including expenditures and loss of profit and
                  goodwill or other diminution in the value of VAR's business),
                  indemnities, except as required under Section 10, or other
                  compensation will be due or payable to VAR by reason of
                  termination or cancellation of this Agreement.

14.      Other Provisions

         (a)      This Agreement will be governed by the laws of the State of
                  Michigan.

         (b)      Either party retains the option with respect to the right to
                  apply to a court of competent jurisdiction for equitable
                  relief.

         (c)      The parties shall attempt to resolve claims or controversies
                  arising out of or related to this Agreement in the following
                  manner: A Vice President for each party with full authority to
                  negotiate and resolve issues in question shall meet and
                  attempt to settle all outstanding disputes within ten (10)
                  business days of time dispute arose. After such

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CONFIDENTIAL AND PROPRIETARY

                  initial meeting, if the dispute is not resolved within the
                  next thirty (30) days, the parties shall pursue alternate
                  remedies.

         (d)      The relationship of Compuware and VAR under this Agreement is
                  that of licensor and licensee only and neither is authorized
                  to act as the agent of the other. In all matters relating to
                  this Agreement, VAR will act as an independent contractor. No
                  franchise is intended or created by the relationship of
                  Compuware and VAR under this Agreement. Neither party will
                  make representations purportedly on behalf of the other party,
                  otherwise than as precisely set forth in this Agreement and as
                  set forth in Compuware's supplied user materials.

         (e)      Any failure or delay by either party in exercising any right
                  or remedy will not constitute a waiver. The waiver of any one
                  default will not waive subsequent defaults of the same or
                  different kind.

         (f)      Neither party will be liable for any failure to fulfill its
                  obligations due to causes beyond its reasonable control
                  including, without limitation, the bankruptcy of any supplier
                  or commercial impossibility.

         (g)      All notices required by this Agreement to be given to VAR will
                  be sent by certified or registered mail addressed to its
                  address on the first page of this Agreement. Notices to be
                  given to Compuware will be sent by certified or registered
                  mail addressed to the Compuware Vice President of Sales as
                  identified in Exhibit I.

                  Requests for information and all other notices to Compuware
                  will be sent to the separate Compuware address set out in
                  Exhibit I.

         (h)      Each provision of this Agreement is severable and if one or
                  more provisions are declared invalid, the remaining provisions
                  of the Agreement will remain in full force and effect.

V.       ENTIRE AGREEMENT

This Agreement, including any Product Schedule(s) hereto, and Exhibits
referenced herein, contain the entire understanding and agreement of the parties
with respect to the matters contained herein, and supersede any prior oral or
written agreements relating to the subject matter hereof. This Agreement
supercedes all previous agreements between Compuware and JDA or JDA
subsidiaries, including but not limited to, UNIFACE Corporation Canada License
Agreement, dated May 12, 1995, (reference client #95492) between JDA Software
and UNIFACE Corporation Canada, and Standard Value-Added Reseller Agreement
dated June 27, 1994, between LIOCS Corporation (a wholly-owned subsidiary of
VAR, client #94183) and UNIFACE Corporation. This Agreement may be modified only
in writing signed by an authorized representative of each party. Additional
supplements relating to specific products and services may be added from time to
time as such products and services are offered by Compuware.

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VI. EXHIBIT LIST

The following Exhibits are attached hereto and incorporated by reference:

         Exhibit I.      VAR Profile

         Exhibit II.     Remarketers List

         Exhibit III.    Compuware Trial Agreement

         Exhibit IV.     VAR Quarterly Royalty Report

         Exhibit V.      Non-Disclosure Agreement

         Exhibit VI.     Sample Compuware License Agreement and Product Schedule

VAR ACKNOWLEDGES THAT IT HAS READ AND UNDERSTANDS THIS AGREEMENT AND ALL
ATTACHED EXHIBITS, AND THAT IT IS NOT ENTERING INTO THIS AGREEMENT ON THE BASIS
OF ANY REPRESENTATIONS NOT EXPRESSLY SET FORTH HEREIN.

Accepted by:                                   Accepted by VAR:
COMPUWARE CORPORATION                          JDA SOFTWARE GROUPING INC.

/s/ W. Alan Cantrell                           /s/ James D. Armstrong
- ---------------------------                    ---------------------------
Authorized Signature                           Authorized Signature

W. ALAN CANTRELL                               James D. Armstrong
- ---------------------------                    ---------------------------
Name                                           Name

Vice President
Enterprise Solutions                           Chief Executive Officer
- ---------------------------                    ---------------------------
Title                                          Title

JUNE 23, 2000                                  JUNE 23, 2000
- --------------------------                     --------------------------
Date                                           Date

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                                   EXHIBIT I.
                                  VAR PROFILE

1.       The "Payment Address" is:

         Compuware Corporation
         Drawer 64376
         Detroit, MI 48264-0376

2.       Market and Territory assignment: Worldwide

3.       UNIFACE Software:

* UNIFACE Six

                  - UNIFACE Developer;

                  - UNIFACE PolyServer;

                  - UNIFACE DBMS, GUI and Network drivers & Binders;

* UNIFACE Seven

Development:      - UNIFACE Enterprise Development

Deployment        - UNIFACE PolyServer;

                  - UNIFACE Application Server;

                  - UNIFACE Enterprise Server;

                  - UNIFACE DBMS, GUI and Network drivers & Binders;

                  - Solid;

                  Web Application Server

                  - Component Server

                  - Java and Com URBA connectivity options

                  - Across all databases and platforms (except mainframes)

5.       License fees/ Royalties:

LICENSE FEES

- - Development License 70% of Compuware's then current U.S. list price ; VAR will
license UNIFACE development licenses for all developers, support staff, and
consultants using UNIFACE source code.

- - Deployment License 70% of Compuware's then current U.S. list price; VAR will
license and maintain UNIFACE deployment licenses for its internal use for such
functions as engineering, testing, technical support, etc.

The above referenced license fees shall not increase during the Term, on a
cumulative basis, over the previous year's fees by more than fifteen percent
(15%) for an equivalent computer configuration.

Deployment licenses will cover all representative platforms that VAR sells.

Compuware will provide VAR with temporary Deployment Licenses for Marketing and
Sales Purposes at no charge.

ROYALTIES

The royalty rate is calculated based on the fees paid by JDA's customer for VAR
Application Software. It shall be set at seven percent (7%) for a period of
twenty-four (24) months from the Effective Date of this Agreement, of which 0.6%
is first year maintenance. A total prepayment of $1,250,000 U.S. Dollars due and
payable as follows: an initial prepayment of

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$625,000 ("Initial Payment") shall be due upon execution of this Agreement, a
second prepayment of $625,000 is payable on or before June 30, 2000. Compuware
will apply the Initial Payment accordingly for a twenty-four month term ending
March 31, 2002 for license fees and royalty payments due under the terms and
conditions of this Agreement. After twenty-four (24) months, the royalty rate
will increase to a level not to exceed ten percent (10%), including first year
maintenance. Notwithstanding the foregoing, JDA may at any time during the term
of this Agreement exercise an option to make an additional $1,250,000 prepayment
to extend the seven percent (7%) royalty rate for an additional twenty-four
months from the date of such election ("Pre-pay Option"). JDA will have up to
three (3) Pre-pay Options, provided the total term of this Agreement does not
exceed eight (8) years. Any remaining balance of the Payment at the end of the
designated Pre-pay Option term shall be forfeited by JDA with no right of refund
or credit.

6.       All fees and royalties are exclusive of Value-Added Tax (VAT). VAR
         shall pay all VAT taxes due where applicable.

7.       Annual Support Service Fees

- -        VAR DEVELOPMENT AND INTERNAL USE DEPLOYMENT LICENSES

         Annual Support Service fees will be fifteen percent (15%) of the
         license fee as provided in Section 5 of this Exhibit I.

- -        END USER DEPLOYMENT LICENSES SUPPORT SERVICES (the first year support
         service fee is included in the royalty rate calculation).

         Thereafter, for End User(s) under support for the VAR Application
         Software, the annual Support Service fee will be 0.6% percent of the
         applicable royalty fee as provided in Section 5 of this Exhibit I.

8.       VAR Application Software:

         a.       ODBMS

                  Application modules within the ODBMS package that utilize the
                  UNIFACE development and deployment environments:

                  Interactive Base System Maintenance

                  Interactive Buyers Workbench (purchase order management)
                  Interactive Pricing
                  Interactive Advanced Expert Pricing
                  Interactive Inventory & Cycle Count Management
                  Interactive Merchandise Category Analysis
                  Interactive Rebate Management
                  Interactive Stock Ledger
                  Interactive Sales Audit
                  Interactive Tax Management
                  Interactive Vendor Submissions
                  Interactive Automated Replenishment Management
                  Interactive Invoice Matching
                  Interactive Signs, Labels, Ticketing

                  Interactive Warehouse Control Center

                  ODBMS is a market-leading open, client/server merchandising
                  system, ODBMS delivers deep, rich merchandising functionality
                  and usability to automate a retailer's information management
                  and operational requirements. Retailers can depend on ODBMS to
                  help them optimize inventory, maintain a profitable product
                  mix, improve price strategies and automate replenishment. By
                  providing

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                  flexibility, adaptability and scalability, ODBMS enables
                  retailers to manage multiple operations without sacrificing
                  data integrity or ease of use.

         b.       Additional VAR Application Software developed by VAR may be
                  incorporated herein upon written notice to Compuware as
                  required for reporting purposes.. In the event that VAR
                  acquires another Compuware Value Added Reseller's VAR
                  Application Software, upon notice to Compuware JDA may
                  incorporate the acquired VAR Application Software into this
                  Agreement at the then current JDA royalty rate by prepaying
                  royalties to Compuware. The amount of the prepayment will be
                  two (2) times the amount of royalties the VAR, from which the
                  VAR Application Software was acquired, paid to Compuware in
                  the previous twelve (12) months.

         c.       VAR shall notify Compuware in writing of any new products, new
                  functionalities, or new versions to the VAR Application
                  Software Compuware. Any new products will be incorporated to
                  this Exhibit by Amendment.

9.       Hardware, Operating Systems and location(s) VAR:

                  JDA Software Group, Inc.
                  14400 North 87th Street
                  Scottsdale, AZ 85260-3649

10.      Development Address VAR:

                  JDA Software Group, Inc.
                  14400 North 87th Street
                  Scottsdale, AZ 85260-3649

11.      Discount on UNIFACE Education:

         VAR will receive up to 25 % discount on UNIFACE Education.

12.      Compuware Managing Office

         Attn: Sally Knoll, ISV Account Manager
         Compuware Corporation
         31440 Northwestern Highway
         Farmington Hills, MI 48334

13.      Notices Address

         Contracts Manager
         Compuware Corporation
         31440 Northwestern Highway
         Farmington Hills, MI 48334

14.      Information Address

         Compuware Corporation
         Products Division
         Contract Administration
         31440 Northwestern Highway
         Farmington Hills, MI 48334

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                                  EXHIBIT II.
                                REMARKETERS LIST
                             CURRENT (AS OF 4/6/00)
                           JDA CORPORATE ORGANIZATION

                            JDA Software Group, Inc.
                                   (Delaware)

                                               
      JDA Software (Arizon) Inc.)                        JDA Arthur Software Ltd.
(license all products worldwide except MMS                      (Bermuda)
      alone outside No.& So. America)

      JDA Software Australia (Pty.) Ltd.                 JDA Software Brasil Ltds.
                   (Australia)                                    (Brazil)

          JDA Software Canada Ltd.                            JDA Chile S.A.
                    (Canada)                                     (Chile)
(authority to license all products In Canada
with a 35% (previously 10%) royalty to U.S.)

          JDA Software France. S.A.                         JDA Software GmbH
                    (France)                                    (Germany)

            JDA Software Hong, Kong                          JDA Software Italy  S.V.
                   Limited                                           (Italy)
                 (Hong Kong)

           JDA Software Japan Ltd.                     JDA Software Malaysia SDN. Bhd.
                  (Japan)                                      (Malaysia)

           JDA de Mexico S.A. de C.V.                     JDA Software Benelux B.V.
                    (Mexico)                                 (The Netherlands)

              LIOCS Corporation                        JDA Software South Africa (PTY) Ltd,
                   (Nevada)                                      (South Africa)

            JDA Software Nordic AB                           JDA Asia Pte. Ltd.
                  (Sweden)                                      (Singapore)

                                                             JDA Worldwide, Inc.
             JDA International Limited                           (Arizona)
                 (England & Wales)               (sublicense license MMS alone outside No. & So.
                                                 America with a 35% (previously 5O%) royalty)

             JDA Software Spain                          JDA UK Branch
          (Representative Office)                      (United Kingdom)



                               REMARKETER DETAILS

Company Name ___________________________________________________________________

Contact person __________________________________ Email address ________________

Telephone ____________________________________   Fax ___________________________

                              APPLICATION DETAILS

Application name________________________ No. of end users - Named - Concurrent

State deployed modules _________________________________________________________

Application list price_______________ Invoiced application license price _______

                          END USER ORGANIZATION DETAILS

Company Name ____________________________ Division _____________________________

Contact Person __________________________ Email address ________________________

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Main company address ___________________________________________________________

City _________________ State/province _____________ Postal Code/ZIP ____________

Country _______________________

     Telephone _______________________ Fax _____________________________________

                            UNIFACE LICENSING DETAILS
UNIFACE license type
________________________________________________________________________________

                            UNIFACE TECHNICAL DETAILS

UNIFACE version details:

- - UNIFACE 5.2....  - UNIFACE Six....  - UNIFACE Seven....(please specify exact
                                                          version)

Client System(s) details:
________________________________________________________________________________
CPU make & model       (1)        Operating system, version & user interface (1)

________________________________________________________________________________
CPU make & model       (2)        Operating system, version & user interface (2)

________________________________________________________________________________
Network driver(s)

________________________________________________________________________________
Database make & version

Server(s) details:                      - PolyServer - Appl. Server - WebEnabler

________________________________________________________________________________

CPU make & model (1) Operating system & version(1)             UNIFACE Component

                                        - PolyServer - Appl. Server - WebEnabler
________________________________________________________________________________

CPU make & model (2)            Operating system & version (2) UNIFACE Component
________________________________________________________________________________
Network driver(s)

________________________________________________________________________________
Database make & version (1)                          Database make & version (2)

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                                  EXHIBIT III.
                           COMPUWARE TRIAL AGREEMENT

                                         Client No.:____________________________
                                 Salesperson No.:_______________________________

                            SOFTWARE TRIAL AGREEMENT

In order to better evaluate the benefits available from using the Software
product(s) indicated below ("Software"), COMPUWARE agrees to license the
Software on a FREE in-house trial under the following conditions:

A.       The trial period will be for sixty (60) days after installation of the
         Software from COMPUWARE.

B.       There will be no charge for the sixty (60) day evaluation period.

C.       Company will respect and protect COMPUWARE's proprietary rights to the
         Software and will not distribute or otherwise disclose the Software to
         third parties. All materials and copies of the Software will be
         returned to COMPUWARE at the expiration of the sixty (60) day trial
         period, and Company will also certify in writing that the Software has
         been removed from the system and is no longer in use, if the Software
         is not licensed. If Company continues to use the Software after the
         expiration of the trial period, the Software will be deemed to be
         accepted by Company under the terms and conditions of COMPUWARE's
         License Agreement and Company shall pay the license fee then in effect.

D.       PC SOFTWARE - If applicable, Company may make up to _______________
         copies of the PC component of the Software during the trial period.
         Company will return all copies of the Software at the conclusion of the
         trial period, if the Software is not licensed.

E.       Company will use its best efforts to protect the confidentiality and
         proprietary rights of COMPUWARE's Software.

F.       This Trial Agreement is for the following COMPUWARE Software: _________

G.       Company operating system is __________________________

The undersigned signatories are authorized to execute this Trial Agreement.

Accepted By Compuware:                           Agreed By Licensee:
_________________________                        _________________________
Authorized Signature                             Authorized Signature

_________________________                        _________________________
Name                                             Name

_________________________                        _________________________
Title                                            Title

_________________________                        _________________________
Date                                             Date

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -26-


                                  EXHIBIT IV.
                          VAR QUARTERLY ROYALTY REPORT

         This reporting form should be used by VAR to comply with quarterly
         royalty reporting obligations as set forth in the Agreement. Please
         complete and return to: Compuware Corporation, Contract Administration
         Dept., 31440 Northwestern Highway, Farmington Hills, Michigan
         48334-2564,
         Tel: (248) 737-7300; Fax (248) 737-0750.

         -----------------------------------------------------------------------
         COMPANY NAME:
         -----------------------------------------------------------------------
         ADDRESS (Street Address;
         City/State; Zip):
         CONTACT NAME & PHONE:
         REPORTING PERIOD:
         PURCHASE ORDER #:
         -----------------------------------------------------------------------

         The following must be completed for all VAR Application Software
         (sub)licensed during the reporting period:



                                                               User
Name             UNIFACE         Hardware       User       Address/City,
Application    Product(s)        Make/Model     Name       State/Country     Ship Date        Quantity     Royalty
- ------------   ---------         ----------     ----       --------------    ---------        --------     -------
                                                                                      


         The undersigned certifies that the information contained on this
         reporting form has been derived from VAR's records and is true and
         correct.

         Accepted by:

________________________                         ________________________
Authorized Signature                             Authorized Signature

________________________                         ________________________
Name                                             Name

________________________                         ________________________
Title                                            Title

________________________                         ________________________
Date                                             Date

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -27-


                                   EXHIBIT V
                            NONDISCLOSURE AGREEMENT

THIS AGREEMENT (the "Agreement"), is made as of___________________, 2000, (the
"Effective Date") by and between JDA SOFTWARE, INC., an Arizona corporation
("JDA") and COMPUWARE CORPORATION, A Michigan corporation ("Compuware").

                                    RECITALS

1.       In connection with the evaluation or pursuit of certain mutually
         beneficial business opportunities, JDA and Compuware may disclose
         valuable proprietary information to each other relating to their
         respective operations and businesses.

2.       JDA and Compuware would like to protect the confidentiality of,
         maintain their respective rights in and prevent the unauthorized use
         and disclosure of such information.

                                    AGREEMENT

JDA and Compuware hereby agree:

1.       CONFIDENTIAL INFORMATION. As used in this Agreement, "Confidential
         Information" means all information of either party that is not
         generally known to the public, whether of a technical, business or
         other nature (including, without limitation, trade secrets, know-how
         and information relating to the technology, software, designs,
         specifications and prototypes, customers, business plans, promotional
         and marketing activities, finances and other business affairs of such
         party), that is disclosed by one party (the "Disclosing Party") to the
         other party (the "Receiving Party"), and that has been identified as
         being proprietary and/or confidential or that by the nature of the
         circumstances surrounding the disclosure ought to be treated as
         propriety and confidential. Confidential Information also includes all
         information concerning the existence and progress of the parties'
         dealings.

2.       USE OF CONFIDENTIAL INFORMATION. The Receiving Party, except as
         expressly provided in this Agreement, will not disclose it to anyone
         without the Disclosing Party's prior written consent. The Receiving
         Party will not use, or permit other to use, Confidential Information
         for any purpose other than to pursue discussion and evaluation of
         potential business dealings between the parties in accordance with the
         nature of discussions between the parties. The Receiving Party will
         take all reasonable measures to avoid disclosure, dissemination or
         unauthorized use of Confidential Information, including, at a minimum,
         those measures it takes to protect its own confidential information of
         a similar nature.

3.       EXCEPTIONS. The provisions of Section 2 will not apply to any
         information that (i) is or becomes publicly available without breach of
         this Agreement; (ii) can be shown by documentation to have been known
         to the Receiving Party at the time of its receipt from the Disclosing
         Party; (iii) is rightfully received from a third party who did not
         acquire or disclose such information by a wrongful or tortuous act; or
         (iv) can be shown by documentation to have been independently developed
         by the Receiving Party without reference to any Confidential
         information.

4.       RECEIVING PARTY PERSONNEL. The Receiving Party will restrict the
         possession, knowledge, development and use of Confidential Information
         to its employees, agents, subcontractors and entities controlled by or
         controlling it (collectively, "Personnel") who have a need to know
         Confidential Information in connection with the purposes set forth in
         Section 2. The Receiving Party's Personnel will have access only to the
         Confidential Information they need for such purposes. The Receiving
         Party will ensure that its personnel comply with this Agreement.

5.       DISCLOSURES TO GOVERNMENTAL ENTITIES. If the Receiving Party becomes
         legally obligated to disclose Confidential Information by any
         governmental entity with jurisdiction over it, the Receiving Party will
         give the Disclosing Party prompt written notice sufficient to allow the
         Disclosing Party to seek a protective order or other appropriate
         remedy. The Receiving Party will disclose only such information as is
         legally required and will use its reasonable best efforts to obtain
         confidential treatment for any Confidential Information that is so
         disclosed.

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -28-


6.       OWNERSHIP OF CONFIDENTIAL INFORMATION. All Confidential Information
         will remain the exclusive property of the Disclosing Party, and the
         Receiving Party will have no rights, by license or otherwise, to use
         the confidential Information except as expressly provided herein.

7.       RETURN OF CONFIDENTIAL INFORMATION. Upon the Disclosing Party's written
         request, the Receiving Party promptly will return all tangible material
         embodying Confidential Information (in any form and including, without
         limitation, all summaries, copies and excerpts of Confidential
         Information).

8.       GOVERNING LAW; ETC. This Agreement will be governed by internal laws of
         the State of Arizona, without reference to its choice of law rules, and
         may be executed in counterpart copies. If a provision of this Agreement
         is held invalid under any applicable law, such invalidity will not
         affect any other provision of this Agreement that can be given effect
         without the invalid provision. All terms and conditions of this
         Agreement will be deemed enforceable to the fullest extent permissible
         under applicable law, and, when necessary, the court is requested to
         reform any and all terms or conditions to give them such effect.
         Further, the venue for arbitration or litigation will be in Phoenix,
         Arizona, and the parties consent to such jurisdiction.

9.       NONWAIVER. Any failure by either to enforce the other party's strict
         performance of any provision of this Agreement will not constitute a
         waiver of its right to subsequently enforce such provision or any other
         provision of this Agreement.

10.      TERMINATION. This Agreement will terminate automatically upon the
         completion or termination of dealings between JDA and Compuware;
         provided, however, that each party's obligations with respect to the
         other party's Confidential Information will survive completion or
         termination of the dealings between the parties.

11.      EXPORTATION/TRANSMISSION OF CONFIDENTIAL INFORMATION. The Receiving
         Party acknowledges that the Confidential Information and any related
         materials or information provided hereunder are subject to the export
         control laws and regulations of the U.S., and any amendments thereof.
         The Receiving Party confirms that it will not export or re-export these
         items, directly or indirectly, either to (i) any countries that are
         subject to U.S. export restrictions (currently including, but not
         necessarily limited to, Cuba, the Federal Republic of Yugoslavia
         (Serbia and Montenegro), Iran, Iraq, Libya, North Korea, and Syria);
         and (ii) any development production of nuclear, chemical or biological
         weapons; or (iii) any third party who has been prohibited from
         participating in the U.S. export transactions by any federal agency of
         the U.S. government.

12.      INDEPENDENT DEVELOPMENT. The Disclosing Party acknowledges that the
         Receiving Party may currently or in the future be developing
         information internally, or receiving information from other parties,
         that is similar to the Confidential Information. Accordingly, nothing
         in this Agreement will be construed as a representation or agreement
         that the Receiving Party will not develop or have developed for its
         products, concepts, systems or techniques that are similar to or
         compete with products, concepts, systems or techniques contemplated by
         or embodied in the Confidential Information, provided that the
         Receiving Party does not violate any of its obligations under this
         Agreement in connection with such development.

13.      INJUNCTIVE RELIEF. The Receiving Party acknowledges that disclosure or
         use of Confidential Information in violation of this Agreement could
         cause irreparable harm to the Disclosing Party for which monetary
         damages may be difficult to ascertain or an inadequate remedy. The
         Receiving Party therefore agrees that the Disclosing Party will have
         the right, in addition to its other rights and remedies, to seek
         injunctive relief for any violation of this Agreement.

14.      LIMITED RELATIONSHIP. This Agreement will not create a joint venture,
         partnership or other formal business relationship or entity of any
         kind, or an obligation to form any such relationship or entity. Each
         party will act as an independent contractor and not as an agent of the
         other party for any purpose, and neither will have the authority to
         bind the other.

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -29-


15       CUMULATIVE OBLIGATIONS. Each party's obligations hereunder are in
         addition to, and not exclusive of, any and all of its other obligations
         and duties to the other party, whether express, implied, and in fact or
         in law.

16.      INTEGRATION/PURCHASE ORDER. This Agreement constitutes the entire
         agreement between the parties with respect to the Confidential
         Information and supersedes all previous proposals (both oral and
         written), negotiations, representations, commitments, writings,
         agreements, and all other communications between the parties. This
         Agreement may only be altered or modified by written instrument duly
         executed by both parties. In the event of any conflict between the
         terms and conditions of this Agreement and the terms and conditions of
         any purchase order, the terms and conditions of this Agreement will
         control.

The undersigned represent that they are duly authorized representatives of the
parties and have full authority to bind the parties, including any indicated
affiliates of the parties, by execution of this Agreement. The parties have
executed and delivered this Agreement, and it will be effective as of the
Effective Date.

COMPUWARE CORPORATION                            JDA SOFTWARE, INC.

Signature ___________________                    Signature _____________________

Name ________________________                    Name __________________________

Title _______________________                    Title _________________________

Date ________________________                    Date __________________________

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -30-


                                   EXHIBIT VI.

                       SAMPLE COMPUWARE LICENSE AGREEMENT
                              AND PRODUCT SCHEDULE

                                                 Agreement No.__________________

                                LICENSE AGREEMENT

This License Agreement (Agreement), is between COMPUWARE CORPORATION (Compuware)
and Licensee:

Licensee Name: _________________________________________________________________

Street Address: ________________________________________________________________

                ________________________________________________________________

City: __________________________________ State: ________ Zip: __________________

1.       GRANT OF LICENSE

(a)      Upon Compuware's acceptance of each product schedule (Product
         Schedule(s)), Compuware grants to Licensee a non-exclusive,
         non-transferable, personal license to use the proprietary software
         product(s) and related user manuals provided under this Agreement
         (collectively referred to as Software). The Software may be used on the
         computer(s) as described on the Product Schedule(s) (Licensed
         Computer(s)) at the location(s) as described on the Product Schedule(s)
         (Licensed Location(s)), for the term and license type specified,
         subject to the terms and conditions of this Agreement and the Product
         Schedule(s).

(b)      The Software will be supplied to Licensee in machine readable object
         code for use on the Licensed Computer(s).

(c)      A copy of each user manual for the Software will be supplied to
         Licensee without additional charge, unless otherwise specified on the
         Product Schedule(s).

(d)      The Software may be used only (i) by Licensee, (ii) to process
         Licensee's own data and (iii) for Licensee's own internal operations.
         Licensee may not use the Software to offer data processing services to
         third parties, including but not limited to timesharing, facilities
         management, outsourcing or service bureau use, or other third party
         commercial purpose or gain unless Licensee either executes, and pays
         the fees associated with, an appropriate Compuware license for third
         party use or the specific third party use is otherwise authorized in
         writing by Compuware. All restrictions applicable to Licensee will also
         apply to any authorized third party user.

(e)      Licensee shall not make or allow others to make copies or reproductions
         of the Software in any form without Compuware's prior written consent,
         except for a machine readable copy for archival purposes to exercise
         the license granted. All copies or reproductions of the Software made
         by Licensee shall display the same Compuware legends and notices and
         shall be subject to the same conditions and restrictions as the
         original. Licensee shall not sublicense, distribute, modify or create
         derivative works of, reverse assemble or reverse compile, the Software.

(f)      By paying the fee(s) then in effect, the Software may be licensed for:
         additional users, use on additional computers, use on alternate
         platforms or, subject to maintenance being current, use on upgraded
         computers. Alternate locations and computers may be utilized
         temporarily only for back up and disaster recovery purposes for a
         reasonably necessary time period. Licensee may change the facility
         location(s) of the Software with prior written consent from Compuware,
         and shall notify Compuware in writing that all copies of the Software
         at the previous location(s) have been destroyed or transferred to the
         new location(s).

(g)      At Compuware's request, Licensee shall promptly furnish Compuware with
         written certification verifying that the Software is being used in
         accordance with this Agreement, including the number of users and the
         location, platform, model and serial number of the computers) on which
         the Software is installed. Licensee shall give Compuware reasonable
         access to Licensee's records and systems to verify that the Software is
         being used pursuant to this Agreement.

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -31-


(h)      If the actual number of users exceeds the actual number of licensed
         users of the Software or the Software has been installed on unlicensed
         computers or platforms, Compuware may, at its option, terminate this
         Agreement or allow Licensee to pay the license fee then in effect,
         retroactive to the initial date of unauthorized use.

2.       PAYMENTS

Licensee shall pay to Compuware the total amount set forth in the applicable
Product Schedule(s) (Total Amount) upon invoice. Compuware may impose a late
payment charge equal to the lesser of 1-1/2% per month or the maximum rate
allowed by law.

3.       ACCEPTANCE

The Software described on a Product Schedule(s) will be deemed to be accepted by
Licensee upon Licensee's execution of that Product Schedule(s) or upon
Licensee's use of the Software in a production environment, whichever is sooner.
Licensee shall conduct its evaluation procedures between the time the Software
is delivered and Licensee's execution of the Product Schedule(s).

4.       ENTIRE AGREEMENT

HAVING READ BOTH SIDES OF THIS AGREEMENT, THE PARTIES AGREE TO BE BOUND AND
ABIDE BY ITS TERMS AND CONDITIONS. THIS AGREEMENT, INCLUDING ALL PRODUCT
SCHEDULES, CONSTITUTES THE COMPLETE AND EXCLUSIVE STATEMENT OF THE UNDERSTANDING
BETWEEN THEM, AND SUPERSEDES ALL PRIOR PROPOSALS AND ALL OTHER PRIOR
COMMUNICATIONS BETWEEN THEM RELATING TO THIS LICENSE AND THE USE OF THE
SOFTWARE, WHETHER ORAL OR WRITTEN, AND THE TERMS AND CONDITIONS OF ANY PRIOR,
CONCURRENT OR SUBSEQUENT PURCHASE ORDER(S) PROVIDED BY LICENSEE. THIS AGREEMENT
IS BINDING UPON EXECUTION BY AN AUTHORIZED REPRESENTATIVE OF LICENSEE AND
ACCEPTANCE BY AN AUTHORIZED REPRESENTATIVE OF COMPUWARE, AND MAY ONLY BE ALTERED
OR MODIFIED BY A WRITTEN AGREEMENT SIGNED BY AN AUTHORIZED REPRESENTATIVE OF
EACH PARTY.

5.       TITLE, PROPRIETARY RIGHTS AND NON-DISCLOSURE

(a)      Title and full ownership rights to the Software furnished under this
         Agreement and all intellectual property rights including patent,
         copyright, trademark and trade secret rights remain with Compuware or
         its third party providers where applicable. This Agreement does not
         transfer title to Licensee of the intellectual property contained in
         the Software.

(b)      Licensee acknowledges and agrees that the Software is the property of
         and contains trade secrets of Compuware and agrees that Licensee will,
         and Licensee will cause its employees, to keep in confidence and
         protect the Software from disclosure to third parties and restrict its
         use as provided in this Agreement. Licensee acknowledges that
         unauthorized disclosure may cause substantial economic loss to
         Compuware or its third party providers. Compuware reserves all rights
         granted to it under the copyright, patent and other intellectual
         property laws of the United States and all other statutory and common
         laws.

(c)      Licensee shall not be liable to Compuware for disclosure of the
         Software if the same is (i) now in or subsequently comes into the
         public domain without breach of this Agreement, (ii) known to Licensee
         without obligation of confidentiality prior to receipt of the
         proprietary material from Compuware, (iii) independently developed by
         the Licensee without breach of this Agreement, (iv) disclosed by
         Licensee with the prior written approval of an authorized Compuware
         officer, or (v) rightfully received by Licensee from a third party
         without breach of this Agreement or accompanying secrecy obligations.

(d)      This section 5 shall survive the termination of this Agreement.

6.       TAXES AND DUTIES

Licensee shall pay all applicable taxes due under this Agreement, including but
not limited to federal, state or local sales, use, tariffs, duties and value
added taxes, excluding taxes based on Compuware's net income. Licensee is
responsible for personal property and similar taxes on any Software from the
date the Software is shipped to

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -32-


Licensee. Written proof of exempt status must be provided to Compuware for
exemption from any tax, tariff or duty.

7.       ASSIGNMENT AND TRANSFER

Licensee shall not assign or transfer its rights or obligations under this
Agreement without the prior written consent of Compuware. Any authorized
assignment or transfer of the Software shall be subject to Licensee paying the
license and maintenance fees due up to the date of assignment or transfer and
under the terms of the most current Compuware license agreement. Compuware
reserves the right to charge a fee for any assignment or transfer. Any
assignment or transfer prohibited by this provision will be void.

8.       INFRINGEMENT OF INTELLECTUAL PROPERTY RIGHTS

(a)      In the event of an intellectual property right claim, Compuware agrees
         to indemnify and hold Licensee harmless provided Licensee (i) gives
         Compuware prompt written notice of such claim, (ii) permits Compuware
         to defend or settle the claim and (iii) provides all reasonable
         assistance to Compuware in defending or settling the claim.

(b)      In the defense or settlement of such claim, Compuware may (i) obtain
         for Licensee the right to continue using the Software or (ii) replace
         or modify the Software so that it avoids such claim or (iii) if such
         remedies are not reasonably available, accept the return of the
         infringing Software and provide Licensee with a pro-rata refund of the
         license fees paid for such Software based on a five (5) year use
         period.

(c)      Compuware shall have no liability if the alleged infringement is based
         on (i) a modification of the Software by anyone other than Compuware,
         (ii) use of the Software on other than the Licensed Computer(s) or
         (iii) a patent claim for which the existing U.S. patent issue date is
         subsequent to the date of this Agreement. This section states the
         entire liability of Compuware and Licensee's sole and exclusive
         remedies with respect to misappropriation or infringement of
         intellectual property rights.

9.       LIMITED WARRANTIES AND REMEDIES

(a)      Compuware warrants and represents that (i) it has the authority to
         grant the license described in the Agreement, (ii) the Software will
         operate on the Licensed Computer(s) in substantial accordance with the
         specifications set forth in the user manuals applicable to the Software
         at the time the Software is accepted, and (iii) any service rendered by
         Compuware will be performed by qualified personnel. Compuware will make
         reasonable efforts to correct significant deviations from such
         specifications.

(b)      THE WARRANTIES GIVEN IN THIS SECTION ARE IN LIEU OF ALL OTHER
         WARRANTIES WHETHER WRITTEN, ORAL, EXPRESS OR IMPLIED, INCLUDING,
         WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, THE IMPLIED
         WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.

10.      LIMITATION OF LIABILITY

(a)      Except as provided in Section 8 of this Agreement, the entire liability
         of Compuware and Licensee's exclusive remedy for damages from any cause
         related to or arising out of this Agreement, regardless of the form of
         action, whether in contract or in tort, will not exceed the charges
         paid by Licensee to Compuware FOR THE SOFTWARE WHICH IS THE SUBJECT
         MATTER OF THE CAUSE OF ACTION ASSERTED during the TWELVE (12) month
         period immediately preceding Licensee's notice to Compuware of such
         claim or cause.

(b)      In no event will Compuware be liable for any incidental, indirect,
         special or consequential damages, including, but not limited to, loss
         of use, revenues, profits or savings, even if Compuware knew or should
         have known of the possibility of such damages; claims, demands or
         actions against Licensee by any third party, except as provided in
         Section 8; or loss of or damage to Licensee's data from any cause.

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                      -33-


11.      SOFTWARE MAINTENANCE SERVICE

If Licensee is current in the payment of all license and maintenance fees,
Compuware will maintain unaltered Software in an operable condition and in
substantial accordance with the specifications set forth in the user manuals.
Compuware will also make available to Licensee any generally incorporated
improvements and enhancements to the Software which are not designated as
options. Software maintenance service will be provided at no additional charge
for the period specified, if any, on the Product Schedule(s). Licensee may
continue Software maintenance services on an annual basis by paying in advance
the Software maintenance fees then in effect. Compuware will use its best
efforts to make any correction, replacement or other service after Licensee has
identified an error and notified Compuware in accordance with the reporting
procedures outlined in the user manuals. If a malfunction corrected by Compuware
was attributable to Licensee, Licensee agrees to pay Compuware the fair market
value of the services Compuware provided in making the change or correction.
Unless Licensee provides written notice to Compuware at least sixty (60) days
prior to the renewal period to discontinue Software maintenance service, such
Software maintenance will be renewed.

12.      DEFAULT

Either party may terminate the Agreement if the other fails to cure any material
default within thirty (30) days of written notice. Notwithstanding the above,
Compuware may terminate the Agreement upon written notice for any failure of
Licensee to protect Compuware's intellectual property rights in the Software.
Failure to pay any delinquent amount shall cause all unpaid fees, and fees which
would have become due under this Agreement, to become immediately due and
payable and may cause Compuware to suspend any Software maintenance services.
Any terms of this Agreement which by their nature extend beyond its termination
remain in effect until fulfilled, and apply to respective successors and
assignees. Upon termination of any license granted under this Agreement,
Licensee shall immediately either return the Software to Compuware, or destroy
the Software, and certify in writing to Compuware that all copies of the
Software have been destroyed.

13.      GENERAL

Failure or delay by either party in exercising any right or remedy will not
constitute a waiver. In the event that any provision of this Agreement shall be
declared invalid, the entire Agreement shall not fail on its account, and that
provision shall be severed, with the balance of this Agreement continuing in
full force and effect. Product Schedule(s) may be submitted under this Agreement
for a period of three (3) years from the date this Agreement is signed by
Compuware, unless otherwise agreed to in writing by the parties. All Product
Schedule(s) are subject to acceptance by Compuware. Certain Software products
contain product security keys. All agent code for client server software outside
specifications is external to the Software and is the responsibility of
Licensee. Compuware may provide professional services, including technical and
consultant services other than Software maintenance services, at Compuware's
then current rates on a timely basis subject to availability of qualified
personnel. In no event may Software be assigned or transferred outside of
country boundaries. This Agreement shall be governed by the laws of the State of
Michigan and the parties agree to submit to the jurisdiction of the federal or
state courts in the State of Michigan.

Revised: July, 1995

ACCEPTED BY COMPUWARE:                 AGREED BY LICENSEE:

________________________________       _____________________________________
Authorized Signature                   Authorized Signature

________________________________       _____________________________________
Name                                   Name

________________________________       _____________________________________
Title                                  Title

________________________________       _____________________________________
Date                                   Date

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL
                                     - 34 -



PRODUCT SCHEDULE NO. ONE

This Product Schedule will be affixed to and become a part of AGREEMENT NO.
94151V (the "Agreement").

Licensee shall be licensed to use the Software specified below. Such use shall
be governed by the terms and conditions of the Agreement. By paying the fee then
in effect, the Software may be licensed for: additional users, use on additional
computers, use on alternate platforms or, subject to maintenance being current,
use on upgraded computers. In the event that this Product Schedule conflicts
with previous Product Schedule(s) for the specified Software, the most current
Product Schedule(s) will control. In the event that this Product Schedule
conflicts with the Agreement, the Agreement will control.

LICENSEE:                      JDA Software Group, Inc.
SITE NO.: 1                    14400 N. 87th Street
                               Scottsdale, AZ 85260



                                AUTHORIZED                        LICENSED         OS           SUPPORT
         SOFTWARE                LICENSES         AMOUNT        COMPUTER(S)     PLATFORM     SERVICE FEES
         --------               ----------     ------------     -----------     --------     ------------
                                                                              
VAR Application Deployment          *c         $1,250,000*a          *c            *c             *b


*b       Support Service fees will be calculated in accordance with Section 6 of
         Exhibit I to the Agreement.

*c       Licensee shall, upon execution of this Product Schedule, pay Compuware
         royalties of $1,250,000 ("Minimum Royalty Payment"). As Licensee
         deploys VAR Application Software to End Users, the Minimum Royalty
         Payment shall be reduced by an amount equal to the VAR Application
         Software license fee multiplied by .07 (6.4% royalty + .6% first year
         maintenance). The Minimum Royalty Payment is a non-refundable payment
         that must be depleted by March 31, 2002. Thereafter, except as provided
         in Section IV, 5(e) of the Agreement, any unused portion shall be
         forever forfeited, with no right of refund or set off. After March 31,
         2002, Licensee has the option to make an additional Minimum Royalty
         Payment of $1,250,000 to extend the 7% royalty rate for an additional
         twenty-four (24) months. Except as provided in Section IV, 5(e) of the
         Agreement, if Licensee does not exercise said option, the royalty rate
         will increase to a level not to exceed 10% (including first year
         maintenance).

              SCHEDULE PRICE AND TERMS VALID THROUGH JUNE 30, 2000

*a Licensee hereby accepts the Software upon execution of this Product Schedule
and agrees to pay Compuware the Total Amount of $1,250,000 U.S. Dollars in
accordance with the payment terms specified as follows: $625,000 due and payable
with the signing of this Product Schedule and $625,000 due and payable on or
before June 30, 2000.

Accepted By Compuware:                      Agreed By Licensee:

/s/ W. Alan Cantrell                        /s/ James D. Armstrong
- -----------------------------               ---------------------------------
Authorized Signature                        Authorized Signature

Name W. ALAN CANTRELL                       Name James D. Armstrong

Title Vice President                        Title Chief Executive Officer
      Enterprise solutions

Date June 23, 2000                          Date June 23, 2000

                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL

9/17/2001 [ILLEGIBLE]

COMPUWARE CORPORATION                                        [COMPUWARE(R) LOGO]

Systoms Software Division
31440 NORTHWESTERN HIGHWAY-FARMINGTON HILLS, MICHIGAN 48334-2564
(248) 737-7300

PRODUCT SCHEDULE NO. TWO

This Product Schedule will be affixed to and become a part of Agreement No.
94151V

Licensee shall be licensed to use the Software specified below. Such use shall
be governed by the terms and conditions of the Agreement. By paying the
[ILLEGIBLE] then in effect, the Software may be licensed for additional users,
use on additional computers, use on alternate platforms or, subject to
maintenance being current, use on upgraded computers. In the event that this
Product Schedule conflicts with previous Product Schedule(s) for the specified
Software, the most current Product Schedule(s) will control.

LICENSEE:           JDA Software Group, Inc.
SITE NO.: 1         14400 N. 87th Street
                    Scottsdale, AZ 85260


                              AUTHORIZED                      LICENSED         OS           MAINTENANCE
      SOFTWARE                 LICENSEE         AMOUNT       COMPUTER(S)    PLATFORM        SERVICE FEES
      --------                -----------       ------       -----------    --------        -------------
                                                                             
VAR Application Deployment     *a             $1,250,000       *a         *[ILLEGIBLE]            *b


*a       Amount per VAR Application Software Schedule contained in VAR Agreement
         Exhibit I dated April 1, 2000.

*b       Maintenance service fees per VAR Agreement dated April 1, 2000.

*c       Licensee shall, upon execution of this Product Schedule, pay Compuware
         royalties of $1,250,000 ("Minimum Royalty Payment") As Licensee deploys
         VAR Application Software to End Users, the Minimum Royalty Payment
         shall be reduced by an amount equal to the VAR Application Software
         license fee multiplied by 5.7% (5.5% royalty .2%+ first year
         maintenance). The Minimum Royalty Payment is a non-refundable payment
         that must be depleted by December 31, 2003. Thereafter, any unused
         portion shall be forever forfeited, with no right of refund or set off.
         After December 31, 2003, Licensee has the option to make an additional
         Minimum Royalty Payment of $1,250,000 to extend the 5.7% royalty rate
         for an additional twenty-four (24) months. If Licensee does not
         exercise said option, the royalty rate will increase to a level not to
         exceed 10% (including first year maintenance).

            SCHEDULE PRICE AND TERMS VALID THROUGH SEPTEMBER 28, 2001

Licensee hereby accepts the Software upon execution of this Product Schedule and
agrees to pay Compuware the Total Amount of $1,250,000 U.S. Dollars in
accordance with the payment terms specified as follows: $625,000 due and payable
with the signing of this Product Schedule and $625,000 due and payable on or
before November 30, 2001.

Accepted By Compuware:                   Agreed By Licensee:

/s/ James B. Branch                      /s/ James D. Armstrong
- ----------------------------             ---------------------------
Authorized Signature                     Authorized Signature

James B. Branch                          James D. Armstrong
- ----------------------------             ----------------------------
Name                                     Name

Director Business Support                CEO
- ----------------------------             ----------------------------
Title                                    Title

9/28/01                                  9/27/01
- ----------------------------             -----------------------------
Date                                     Date


                                    AMENDMENT
                                       to
                            PRODUCT SCHEDULE NO. TWO
                             (AGREEMENT NO. 94151V)
                                      dated
                               SEPTEMBER 28, 2001
                                     between
                             COMPUWARE CORPORATION
                                       and
                            JDA SOFTWARE GROUP, INC.

This amendment ("Amendment") is hereby affixed to and shall become part of
Product Schedule No. Two dated September 28, 2001 between Compuware Corporation
("Compuware") and JDA Software Group, Inc. ("Licensee") The Amendment, as
incorporated into Product Schedule No. Two, is subject to all terms, conditions,
restrictions and limitations contained in Agreement 94151V. By way of this
Amendment, the following modifications are made:

1)       DELETE *c IN ITS ENTIRETY AND REPLACE WITH THE FOLLOWING:

      *c Licensee shall, upon execution of this Product Schedule, pay Compuware
         royalties of $1,250,000 ("Minimum Royalty Payment"). As Licensee
         deploys VAR Application Software to End Users, the Minimum Royalty
         Payment shall be reduced by an amount equal to the VAR Application
         Software license fee multiplied by a factor of: 1) .057 (5.5% royalty +
         .2% annual maintenance) for the period of September 28, 2001 through
         December 31, 2003; and 2) .125 (12.0% royalty + .5% annual maintenance)
         for the period of January 1, 2004 through March 31, 2005. The Minimum
         Royalty Payment is a non-refundable payment that must be depleted by
         March 31, 2005. Thereafter, any unused portion shall be forever
         forfeited, with no right of refund or set off. It is understood and
         agreed by both parties that should Licensee deplete their inventory and
         therefore License's actual Royalty Payment obligations exceed the
         $1,250,000 ("Minimum Royalty Payment") Licensee has paid Compuware,
         then Licensee shall pay Compuware an amount equal to the VAR
         Application Software license fee multiplied by a factor of: 1) .057
         (5.5% royalty + .2% annual maintenance) for the period of September 28,
         2001 through December 31, 2003; and 2) .125 (12.0% royalty + .5% annual
         maintenance) for the period of January 1, 2004 through March 31, 2005.

2)       ADD THE FOLLOWING AS *d:

      *d For the period of April 1, 2005 through March 31, 2008 Licensee's
         Royalty Payment shall be the VAR Application Software license fee
         multiplied by a factor of .09 (8.7% royalty + .3% annual maintenance).

3)       ADD THE FOLLOWING AS *e:

      *e Both parties consent and agree that the Term of the Agreement (94151V)
         is extended for an additional three (3) years through March 31, 2008.

All other terms and conditions of the Agreement and Product Schedule No. Two
shall remain in full force and effect.

Accepted:                                        Agreed:
COMPUWARE CORPORATION                            JDA SOFTWARE GROUP, INC.

/s/ Don E. Morrison                              /s/ Peter J. Charness
- ---------------------------------                -------------------------------
Authorized Signature                             Authorized Signature

Don E. Morrison                                  Peter J. Charness
- ---------------------------------                -------------------------------
Name (Printed or Typed)                          Name (Printed or Typed)

     ILLEGIBLE                                   SR. VP. JDA Software
- ---------------------------------                -------------------------------
Title                                            Title

12/23/03                                         Dec 19, 2003
- ---------------------------------                -------------------------------
Date                                             Date


                                                               REVIEWED/APPROVED
                                                                   JDA LEGAL

EX-10.15

                                                                   EXHIBIT 10.15

                       NONSTANDARDIZED ADOPTION AGREEMENT
                 PROTOTYPE CASH OR DEFERRED PROFIT-SHARING PLAN

                                  SPONSORED BY

                                 U.S. BANK, N.A.

The Employer named below hereby establishes a Cash or Deferred Profit-Sharing
Plan for eligible Employees as provided in this Adoption Agreement and the
accompanying Basic Plan Document #01.

I.       EMPLOYER INFORMATION

         IF MORE THAN ONE EMPLOYER IS ADOPTING THE PLAN, COMPLETE THIS SECTION
         BASED ON THE LEAD EMPLOYER. ADDITIONAL EMPLOYERS WHO ARE MEMBERS OF THE
         SAME CONTROLLED GROUP OR AFFILIATED SERVICE GROUP MAY ADOPT THIS PLAN
         BY COMPLETING AND EXECUTING SECTION XX(A) OF THE ADOPTION AGREEMENT.

         A.       NAME AND ADDRESS:

                  JDA Software, Inc.
                  14400 North 87th Street
                  Scottsdale, AZ 85260

         B.       TELEPHONE NUMBER: 480-308-3073

         C.       EMPLOYER'S TAX ID NUMBER: 86-0673401

         D.       FORM OF BUSINESS:

                  [ ] 1. Sole Proprietor   [ ]  5. Limited Liability Company

                  [ ] 2. Partnership       [ ]  6. Limited Liability Partnership

                  [X] 3. Corporation       [ ]  7. _____________________________

                  [ ] 4. S Corporation

         E.       IS THE EMPLOYER PART OF A CONTROLLED GROUP?  [X] YES  [ ] NO
                  PART OF AN AFFILIATED SERVICE GROUP?         [ ] YES  [X] NO

         F.       NAME OF PLAN: JDA SOFTWARE, INC. 401(k) PROFIT SHARING PLAN

         G.       THREE DIGIT PLAN NUMBER: 001

         H.       EMPLOYER'S TAX YEAR END: 12/31

         I.       EMPLOYER'S BUSINESS CODE: ____________________________________

II.      EFFECTIVE DATE

         A.       NEW PLAN:

                  This is a new Plan having an Effective Date of ______________.

         B.       AMENDED AND RESTATED PLANS:

                  This is an amendment or restatement of an existing Plan. The
                  initial Effective Date of the Plan was 01/01/1989. The
                  Effective Date of this amendment or restatement is 01/01/2004.

                                                     Section 401(k) Plan AA #010

                                       1



         C.       AMENDED OR RESTATED PLANS FOR GUST:

                  This is an amendment or restatement of an existing Plan to
                  comply with GUST [The Uruguay Round Agreements, Pub. L.
                  103-465 (GATT); The Uniformed Services Employment and
                  Reemployment Rights Act of 1994, Pub. L. 103-353 (USERRA); The
                  Small Business Job Protection Act of 1996, Pub. L. 104-188
                  (SBJPA) [including Section 414(u) of the Internal Revenue
                  Code]; The Taxpayer Relief Act of 1997, Pub. L. 105-34
                  (TRA'97); The Internal Revenue Service Restructuring and
                  Reform Act of 1998, Pub. L. 105-206 (IRSRRA), and The
                  Community Renewal Tax Relief Act of 2000, Pub. L. 106-554
                  (CRA). The initial Effective Date of the Plan was
                  ________________________________________. Except as provided
                  for in the Plan, the Effective Date of this amendment or
                  restatement is __________________________. (The restatement
                  date should be no earlier than the first day of the current
                  Plan Year. The Plan contains appropriate retroactive Effective
                  Dates with respect to provisions of GUST.)

                  PURSUANT TO CODE SECTION 411(d)(6) AND THE REGULATIONS ISSUED
                  THEREUNDER, AN EMPLOYER CANNOT REDUCE, ELIMINATE OR MAKE
                  SUBJECT TO EMPLOYER DISCRETION ANY CODE SECTION 411(d)(6)
                  PROTECTED BENEFIT. WHERE THIS PLAN DOCUMENT IS BEING ADOPTED
                  TO AMEND ANOTHER PLAN THAT CONTAINS A PROTECTED BENEFIT NOT
                  PROVIDED FOR IN THE BASIC PLAN DOCUMENT #01, THE EMPLOYER MAY
                  COMPLETE SCHEDULE A AS AN ADDENDUM TO THIS ADOPTION AGREEMENT.
                  SCHEDULE A DESCRIBES SUCH PROTECTED BENEFITS AND SHALL BECOME
                  PART OF THIS PLAN. IF A PRIOR PLAN DOCUMENT CONTAINS A PLAN
                  FEATURE NOT PROVIDED FOR IN THE BASIC PLAN DOCUMENT #01, THE
                  EMPLOYER MAY ATTACH SCHEDULE B DESCRIBING SUCH FEATURE.
                  PROVISIONS LISTED ON SCHEDULE B ARE NOT COVERED BY THE IRS
                  OPINION LETTER ISSUED WITH RESPECT TO THE BASIC PLAN DOCUMENT
                  #01.

         D.       EFFECTIVE DATE FOR ELECTIVE DEFERRALS:

                  If different from above, the Elective Deferral provisions
                  shall be effective __________________________.

III.     DEFINITIONS

         A.       "COMPENSATION"

                  Select the definition of Compensation, the Compensation
                  Computation Period, any Compensation Dollar Limitation and
                  Exclusions from Compensation for each Contribution Type from
                  the options listed below. Enter the letter of the option
                  selected on the lines provided below. Leave the line blank if
                  no election needs to be made.



                                      COMPENSATION                        EXCLUSIONS
    EMPLOYER          COMPENSATION    COMPUTATION       COMPENSATION         FROM
CONTRIBUTION TYPE      DEFINITION        PERIOD      DOLLAR LIMITATION    COMPENSATION
- -----------------     ------------    ------------   -----------------    ------------
                                                              
All Contributions          b               a                 $                 a
Elective Deferrals                                           $
Voluntary After-tax                                          $
Required After-tax                                           $
Safe Harbor                                                  $
Non-Safe Harbor
Match Formula 1                                              $
QNEC/QMAC                                                    $
Discretionary                                                $
Non-Safe Harbor
Match Formula 2                                              $




ANTIDISCRIMINATION       COMPENSATION      COMPENSATION            COMPENSATION
      TESTS               DEFINITION    COMPUTATION PERIOD      DOLLAR LIMITATION
                                                       
ADP/ACP                                                                  $


                                                     Section 401(k) Plan AA #010

                                       2



                  COMPENSATION COMPUTATION PERIODS MUST BE CONSISTENT FOR ALL
                  CONTRIBUTION TYPES, EXCEPT DISCRETIONARY. IF DIFFERENT
                  COMPUTATION PERIODS ARE SELECTED, THE SELECTION FOR ADP/ACP
                  TESTING WILL BE DEEMED TO BE THE ELECTION FOR ALL PURPOSES
                  EXCEPT FOR DISCRETIONARY CONTRIBUTIONS.

                  1.       Compensation Definition:

                           a.       Code Section 3401(a) - W-2 Compensation
                                    subject to income tax withholding at the
                                    source.

                           b.       Code Section 3401(a) - W-2 Compensation
                                    subject to income tax withholding at the
                                    source, with all pre-tax contributions
                                    added.

                           c.       Code Section 6041/6051 - Income reportable
                                    on Form W-2.

                           d.       Code Section 6041/6051 - Income reportable
                                    on Form W-2, with all pre-tax contributions
                                    added.

                           e.       Code Section 415 - All income received for
                                    services performed for the Employer.

                           f.       Code Section 415 - All income received for
                                    services performed for the Employer, with
                                    all pre-tax contributions excluded.

                           THE CODE SECTION 415 DEFINITION WILL ALWAYS APPLY
                           WITH RESPECT TO SOLE PROPRIETORS AND PARTNERS.

                  2.       Compensation Computation Period:

                           a.       Compensation paid during a Plan Year while a
                                    Participant.

                           b.       Compensation paid during the entire Plan
                                    Year.

                           c.       Compensation paid during the Employer's
                                    fiscal year.

                           d.       Compensation paid during the calendar year.

                  3.       Compensation Dollar Limitation: The dollar limitation
                           section does not need to be completed unless
                           Compensation of less than the Code Section 401(a)(17)
                           limit of $160,000 (as indexed) is to be used.

                  4.       Exclusions from Compensation (non-integrated plans
                           only):

                           a.       There will be no exclusions from
                                    Compensation under the Plan.

                           b.       Any amount included in a Participant's gross
                                    income due to the application of Code
                                    Sections 125, 132(f)(4), 402(h)(1)(B),
                                    402(e) or 403(b) will be excluded from the
                                    definition of Compensation under the Plan.

                           c.       Overtime

                           d.       Bonuses

                           e.       Commissions

                           f.       Exclusion applies only to Participants who
                                    are Highly Compensated Employees.

                           g.       Severance pay

                           h.       Holiday and vacation pay

                           i.       Other: _____________________________________

                                                     Section 401(k) Plan AA #010

                                       3



         B.       "DISABILITY"

         [X]      1. As defined in paragraph 1.26 of the Basic Plan Document
                  #01.

         [ ]      2.       As defined in the Employer's Disability Insurance
                           Plan.

         [ ]      3.       An individual will be considered to be disabled
                           if he or she is unable to engage in any substantial
                           gainful activity by reason of any medically
                           determinable physical or mental impairment which can
                           be expected to result in death or to be of long
                           continued and indefinite duration. An individual
                           shall not be considered to be disabled unless he or
                           she furnishes proof of the existence thereof in such
                           form and manner as the Secretary may prescribe.

         C.       "HIGHLY COMPENSATED EMPLOYEES - TOP-PAID GROUP ELECTION" For
                  Plans which are being amended and restated for GUST, please
                  complete Schedule C outlining the preamendment operation of
                  the Plan, as well as this section of the Adoption Agreement.
                  The testing elections made below will apply to the future
                  operation of the Plan.

         [X]      1.       Top-Paid Group Election:

                           In determining who is a Highly Compensated Employee,
                           the Employer makes the Top-Paid Group election. The
                           effect of this election is that an Employee (who is
                           not a 5% owner at any time during the determination
                           year or the look-back year) who earned more than
                           $80,000, as indexed for the look-back year, is a
                           Highly Compensated Employee if the Employee was in
                           the Top-Paid Group for the look-back year. This
                           election is applicable for the Plan Year in which
                           this Plan is effective.

         [ ]      2.       Calendar Year Data Election:

                           If the Plan Year is not the calendar year, the prior
                           year computation period for purposes of determining
                           if an Employee earned more than $80,000, as indexed,
                           is the calendar year beginning in the prior Plan
                           Year. This election is applicable for the Plan Year
                           in which this Plan is effective.

         D.       "HOUR OF SERVICE"

                  Hours shall be determined by the method selected below. The
                  method selected shall be applied to all Employees covered
                  under the Plan as follows:

         [ ]      1.       Not applicable. For all purposes under the Plan, a
                           Year of Service (Period of Service) is defined as
                           Elapsed Time.

         [X]      2.       On the basis of actual hours for which an Employee is
                           paid or entitled to payment.

         [ ]      3.       On the basis of days worked. An Employee shall
                           be credited with ten (10) Hours of Service if such
                           Employee would be credited with at least one (1) Hour
                           of Service during the day.

         [ ]      4.       On the basis of weeks worked. An Employee shall
                           be credited with forty-five (45) Hours of Service if
                           the Employee would be credited with at least one (1)
                           Hour of Service during the week.

         [ ]      5.       On the basis of semi-monthly payroll periods. An
                           Employee shall be credited with ninety-five (95)
                           Hours of Service if such Employee would be credited
                           with at least one (1) Hour of Service during the
                           semi-monthly payroll period.

         [ ]      6.       On the basis of months worked. An Employee shall
                           be credited with one-hundred-ninety (190) Hours of
                           Service if such Employee would be credited with at
                           least one (1) Hour of Service during the month.

                                                     Section 401(k) Plan AA #010

                                       4



         E.       "INTEGRATION LEVEL"

         [X]      1.       Not applicable. The Plan's allocation formula is not
                           integrated with Social Security.

         [ ]      2.       The maximum earnings considered wages for such
                           Plan Year for Social Security withholding purposes
                           without regard to Medicare.

         [ ]      3.       ________% (not more than 100%) of the amount
                           considered wages for such Plan Year for Social
                           Security withholding purposes without regard to
                           Medicare.

         [ ]      4.       $________, provided that such amount is not in excess
                           of the amount determined under paragraph (E)(2)
                           above.

         [ ]      5.       One dollar over 80% of the amount considered wages
                           for such Plan Year for Social Security withholding
                           purposes without regard to Medicare.

         [ ]      6.       20% of the maximum earnings considered wages for such
                           Plan Year for Social Security withholding purposes
                           without regard to Medicare.

         F.       "LIMITATION YEAR"

                  Unless elected otherwise below, the Limitation Year shall be
                  the Plan Year.

                  The 12-consecutive month period commencing on 01/01 and ending
                  on 12/31.

                  If applicable, there will be a short Limitation Year
                  commencing on ___________________________ and ending on
                  ___________________________. Thereafter, the Limitation Year
                  shall end on the date specified above.

         G.       "NET PROFIT"

         [X]      1.       Not applicable. Employer contributions to the Plan
                           are not conditioned on profits.

         [ ]      2.       Net Profits are defined as follows:

                  [ ]      a.       As defined in paragraph 1.61 of Basic Plan
                                    Document #01.

                  [ ]      b.       Net Profits will be defined in a uniform and
                                    nondiscriminatory manner which will not
                                    result in a deprivation of an eligible
                                    Participant of any Employer Contribution.

                           c.       Net Profits are required for the following
                                    contributions:

                           [ ]      i.      Employer Non-Safe Harbor Match
                                            Formula 1.

                           [ ]      ii.     Employer Non-Safe Harbor Match
                                            Formula 2.

                           [ ]      iii.    Employer QNEC and QMAC.

                           [ ]      iv.     Employer discretionary.

                  ELECTIVE DEFERRALS CAN ALWAYS BE CONTRIBUTED REGARDLESS OF
                  PROFITS. TOP-HEAVY MINIMUMS ARE REQUIRED REGARDLESS OF
                  PROFITS.

         H.       "PLAN YEAR"

                  The 12-consecutive month period commencing on 01/01 and ending
                  on 12/31.

                                                     Section 401(k) Plan AA #010

                                       5



                  If applicable, there will be a short Plan Year commencing on
                  ___________________________ and ending on
                  ___________________________. Thereafter, the Plan Year shall
                  end on the date specified above.

         I.       "QDRO PAYMENT DATE"

         [X]      1.       The date the QDRO is determined to be qualified.

         [ ]      2.       The statutory age 50 requirement applies for purposes
                           of making distribution to an alternate payee under
                           the provisions of a QDRO.

         J.       "QUALIFIED JOINT AND SURVIVOR ANNUITY"

         [X]      1.       Not applicable. The Plan is not subject to
                           Qualified Joint and Survivor Annuity rules. The safe
                           harbor provisions of paragraph 8.7 of the Basic Plan
                           Document #01 apply. The normal form of payment is a
                           lump sum. No annuities are offered under the Plan.

         [ ]      2.       The normal form of payment is a lump sum. The
                           Plan does provide for annuities as an optional form
                           of payment at Section XVIII(C) of the Adoption
                           Agreement. Joint and Survivor rules are avoided
                           unless the Participant elects to receive his or her
                           distribution in the form of an annuity.

         [ ]      3.       The Joint and Survivor Annuity rules are
                           applicable and the survivor annuity will be
                           ______________% (50%, 66-2/3%, 75% or 100%) of the
                           annuity payable during the lives of the Participant
                           and his or her Spouse. If no selection is specified,
                           50% shall be deemed elected.

         K.       "QUALIFIED PRERETIREMENT SURVIVOR ANNUITY"

                  DO NOT COMPLETE THIS SECTION IF PARAGRAPH (J)(1) WAS ELECTED.

         [ ]      1.       The Qualified Preretirement Survivor Annuity shall be
                           100% of the Participant's Vested Account Balance in
                           the Plan as of the date of the Participant's death.

         [ ]      2.       The Qualified Preretirement Survivor Annuity shall be
                           50% of the Participant's Vested Account Balance in
                           the Plan as of the date of the Participant's death.

         L.       "VALUATION OF PLAN ASSETS"

                  The assets of the Plan shall be valued on the last day of the
                  Plan Year and on the following Valuation Date(s):

         [ ]      1.       There are no other mandatory Valuation Dates.

         [X]      2.       The Valuation Dates are applicable for the
                           contribution type specified below:



     CONTRIBUTION TYPE                        VALUATION DATE
     -----------------                        --------------
                                           
All Contributions                                   a
Elective Deferrals
Voluntary After-tax
Required After-tax
Safe Harbor
Non-Safe Harbor Match Formula 1
QNEC/QMAC
Discretionary
Non-Safe Harbor Match Formula 2


                           a.       Daily valued.

                                                     Section 401(k) Plan AA #010

                                       6



                           b.       The last day of each month.

                           c.       The last day of each quarter in the Plan
                                    Year.

                           d.       The last day of each semi-annual period in
                                    the Plan Year.

                           e.       At the discretion of the Plan Administrator.

                           f.       Other:______________________________ .

IV.      ELIGIBILITY REQUIREMENTS

         Complete the following using the eligibility requirements as specified
         for each contribution type. To become a Participant in the Plan, the
         Employee must satisfy the following eligibility requirements.



                                                         ELIGIBILITY
                       MINIMUM    SERVICE       CLASS    COMPUTATION
CONTRIBUTION TYPE        AGE    REQUIREMENT  EXCLUSIONS    PERIOD     ENTRY DATE
- --------------------------------------------------------------------------------
                                                       
All Contributions        21         2           1,2,         1           1
                                                 6

Elective Deferrals

Voluntary After-tax

Required After-tax

Safe Harbor
Contribution*

Non-Safe Harbor
Match - Formula 1

QNECs

QMACs

Employer Discretionary

Non-Safe Harbor Match-
Formula 2


         *IF ANY AGE OR SERVICE REQUIREMENT SELECTED IS MORE RESTRICTIVE THAN
         THAT WHICH IS IMPOSED ON ANY EMPLOYEE CONTRIBUTION, THAT GROUP OF
         EMPLOYEES WILL BE SUBJECT TO THE ADP AND/OR ACP TESTING AS PRESCRIBED
         UNDER IRS NOTICES 98-52, 2000-3 AND ANY APPLICABLE IRS REGULATIONS.

         A.       AGE:

                  1.       No age requirement.

                  2.       Insert the applicable age in the chart above. The age
                           may not be more than 21.

         B.       SERVICE:

                  1.       No Service requirement.

                  2.       1 months of Service (insert number of months
                           applicable to the specified contribution type).

                  3.       _______ months of Service (insert number of months
                           applicable to the specified contribution type).

                                                     Section 401(k) Plan AA #010

                                       7


                  4.       1 Year of Service or Period of Service.

                  5.       2 Years of Service or Periods of Service.

                  6.       1 Expected Year of Service. May enter after six (6)
                           months of actual Service.

                  7.       1 Expected Year of Service. May enter after
                           __________ months of actual Service [must be less
                           than one (1) Year].

                  8.       1 Expected Year of Service. May enter after
                           __________ months of actual Service [must be less
                           than one (1) Year].

                  9.       Completion of ___________ Hours of Service within the
                           ___________ month(s) time period following an
                           Employee's commencement of employment.

                  NO MORE THAN 83 1/3 HOURS OF SERVICE MAY BE REQUIRED DURING
                  EACH SUCH MONTH; PROVIDED, HOWEVER, THAT THE EMPLOYEE SHALL
                  BECOME A PARTICIPANT NO LATER THAN UPON THE COMPLETION OF
                  1,000 HOURS OF SERVICE WITHIN AN ELIGIBILITY COMPUTATION
                  PERIOD AND THE ATTAINMENT OF THE MINIMUM AGE REQUIREMENT.

                  THE MAXIMUM SERVICE REQUIREMENT FOR ELECTIVE DEFERRALS IS 1
                  YEAR. FOR ALL OTHER CONTRIBUTIONS, THE MAXIMUM IS 2 YEARS. IF
                  A SERVICE REQUIREMENT GREATER THAN 1 YEAR IS SELECTED,
                  PARTICIPANTS MUST BE 100% VESTED IN THAT CONTRIBUTION.

                  A Year of Service for eligibility purposes is defined as
                  follows (choose one):

                  DO NOT ENTER THIS DEFINITION IN THE TABLE ABOVE.

         [X]      10.      Not applicable. There is no Service requirement.

         [ ]      11.      Not applicable.  The Plan is using Expected Year of
                           Service or has a Service requirement of less than one
                           (1) year.

         [ ]      12.      Hours of Service method. A Year of Service will
                           be credited upon completion of ____________ Hours of
                           Service. A Year of Service for eligibility purposes
                           may not be less than 1 Hour of Service nor greater
                           than 1,000 hours by operation of law. If left blank,
                           the Plan will use 1,000 hours.

         [ ]      13.      Elapsed Time method.

         C.       EMPLOYEE CLASS EXCLUSIONS:

                  1.       Employees included in a unit of Employees covered by
                           a collective bargaining agreement between the
                           Employer and Employee Representatives, if benefits
                           were the subject of good faith bargaining and if two
                           percent or less of the Employees are covered pursuant
                           to the agreement are professionals as defined in
                           ss.1.410(b)-9 of the Regulations. For this purpose,
                           the term "employee representative" does not include
                           any organization more than half of whose members are
                           owners, officers, or executives of the Employer.

                  2.       Employees who are non-resident aliens [within the
                           meaning of Code Section 7701(b)(1)(B)] who receive no
                           Earned Income [within the meaning of Code Section
                           911(d)(2)] from the Employer which constitutes income
                           from sources within the United States [within the
                           meaning of Code Section 861(a)(3)].

                  3.       Employees compensated on an hourly basis.

                  4.       Employees compensated on a salaried basis.

                  5.       Employees compensated on a commission basis.

                  6.       Leased Employees.

                                                     Section 401(k) Plan AA #010

                                       8


                  7.       Highly Compensated Employees.

                  8.       The Plan shall exclude from participation any
                           nondiscriminatory classification of Employees
                           determined as follows: ____________________________

         D.       ELIGIBILITY COMPUTATION PERIOD: The initial Eligibility
                  Computation Period shall commence on the date on which an
                  Employee first performs an Hour of Service and the first
                  anniversary thereof. Each subsequent Computation Period shall
                  commence on:

                  1.       Not applicable. The Plan has a Service requirement of
                           less than one (1) year or uses the Elapsed Time
                           method to determine eligibility.

                  2.       The anniversary of the Employee's employment
                           commencement date and each subsequent 12-consecutive
                           month period thereafter.

                  3.       The first day of the Plan Year which commences prior
                           to the first anniversary date of the Employee's
                           employment commencement date and each subsequent Plan
                           Year thereafter.

         E.       ENTRY DATE OPTIONS:

                  1.       The first day of the month coinciding with or next
                           following the date on which an Employee meets the
                           eligibility requirements.

                  2.       The first day of the payroll period coinciding with
                           or next following the date on which an Employee meets
                           the eligibility requirements.

                  3.       The earlier of the first day of the Plan Year, or the
                           first day of the fourth, seventh or tenth month of
                           the Plan Year coinciding with or next following the
                           date on which an Employee meets the eligibility
                           requirements.

                  4.       The earlier of the first day of the Plan Year or the
                           first day of the seventh month of the Plan Year
                           coinciding with or next following the date on which
                           an Employee meets the eligibility requirements.

                  5.       The first day of the Plan Year following the date on
                           which the Employee meets the eligibility
                           requirements. If this election is made, the Service
                           waiting period cannot be greater than one-half year
                           and the minimum age requirement may not be greater
                           than age 20-1/2.

                  6.       The first day of the Plan Year nearest the date on
                           which an Employee meets the eligibility requirements.
                           THIS OPTION CAN ONLY BE SELECTED FOR EMPLOYER RELATED
                           CONTRIBUTIONS.

                  7.       The first day of the Plan Year during which the
                           Employee meets the eligibility requirements. THIS
                           OPTION CAN ONLY BE SELECTED FOR EMPLOYER RELATED
                           CONTRIBUTIONS.

                  8.       The Employee's date of hire.

         F.      EMPLOYEES ON EFFECTIVE DATE:

         [X]      1.       All Employees will be required to satisfy both the
                           age and Service requirements specified above.

         [ ]      2.       Employees employed on the Plan's Effective Date do
                           not have to satisfy the age requirement specified
                           above.

         [ ]      3.       Employees employed on the Plan's Effective Date do
                           not have to satisfy the Service requirement specified
                           above.

                                                     Section 401(k) Plan AA #010

                                       9


         G.       SPECIAL WAIVER OF ELIGIBILITY REQUIREMENTS:

                  The age and/or Service eligibility requirements specified
                  above shall be waived for those eligible Employees who are
                  employed on the following date for the contribution type(s)
                  specified. This waiver applies to either the age or service
                  requirement or both as elected below:



                     WAIVER OF AGE      WAIVER OF SERVICE
WAIVER DATE           REQUIREMENT          REQUIREMENT             CONTRIBUTION TYPE
- -----------------------------------------------------------------------------------------------
                                                       
                                                                All Contributions
                                                                Elective Deferrals
                                                                Employer Discretionary
                                                                Non-Safe Harbor Match Formula 1
                                                                Safe Harbor Contribution
                                                                QNEC
                                                                QMAC
                                                                Non-Safe Harbor Match Formula 2


V.       RETIREMENT AGES

         A.       NORMAL RETIREMENT:

         [ ]      1.       Normal Retirement Age shall be age ________  (not to
                           exceed 65).

         [X]      2.       Normal Retirement Age shall be the later of
                           attaining age 55 (not to exceed age 65) or the 5TH
                           (not to exceed the fifth) anniversary of the first
                           day of the first Plan Year in which the Participant
                           commenced participation in the Plan.

                  3.       The Normal Retirement Date shall be:

                  [X]      a.       as of the date the Participant attains
                                    Normal Retirement Age.

                  [ ]      b.       the first day of the month next following
                                    the Participant's attainment of Normal
                                    Retirement Age.

         B.       EARLY RETIREMENT:

         [X]      1.       Not applicable.

         [ ]      2.       The Plan shall have an Early Retirement Age of
                           ________ (not less than age 55) and completion of
                           ________ Years of Service.

                  3.       The Early Retirement Date shall be:

                  [ ]      a.       as of the date the Participant attains Early
                                    Retirement Age.

                  [ ]      b.       the first day of the month next following
                                    the Participant's attainment of Early
                                    Retirement Age.

VI.      EMPLOYEE CONTRIBUTIONS

         A.       ELECTIVE DEFERRALS:

         [X]      1.       Up to 50%.

         [ ]      2.       Participants shall be permitted to make Elective
                           Deferrals in any amount from a minimum of _______% to
                           a maximum of _______% of their Compensation not to
                           exceed $__________.

                                                     Section 401(k) Plan AA #010

                                       10


         [ ]      3.       Participants shall be permitted to make Elective
                           Deferrals in a flat dollar amount from a minimum of
                           $______________ to a maximum of $_____________, not
                           to exceed ______% of their Compensation.

         [ ]      4.       Up to the maximum percentage of Compensation and
                           dollar amount permissible under Section 402(g) of the
                           Internal Revenue Code not to exceed the limits of
                           Code Sections 401(k), 404 and 415.

         B.       BONUS OPTION:

         [X]      1.       Not applicable.

         [ ]      2.       Bonuses paid by the Employer ARE included in the
                           definition of Compensation and the Employer permits a
                           Participant to amend their deferral election to defer
                           to the Plan, an amount not to exceed __________% or
                           $_________ of any bonus received by the Participant
                           for any Plan Year.

         C.       AUTOMATIC ENROLLMENT: The Employer elects the automatic
                  enrollment provisions as follows:

         [ ]      1.       NEW EMPLOYEES.  Employees who have not met the
                           eligibility requirements shall have Elective
                           Deferrals withheld in the amount of ________% of
                           Compensation or $________ of Compensation upon
                           entering the Plan.

         [ ]      2.       CURRENT PARTICIPANTS.  Current Participants who are
                           deferring at a percentage less than the amount
                           selected herein shall have Elective Deferrals
                           withheld in the amount of ________% of Compensation
                           or $________ of Compensation.

         [ ]      3.       CURRENT EMPLOYEES.  Employees who are eligible to
                           participate but not deferring shall have Elective
                           Deferrals withheld in the amount of ______ % of
                           Compensation or $_________ of Compensation.

                  Employees and Participants shall have the right to amend the
                  stated automatic Elective Deferral percentage or receive cash
                  in lieu of deferral into the Plan.

         D.       VOLUNTARY AFTER-TAX CONTRIBUTIONS:

         [X]      1.       The Plan does not permit Voluntary After-tax
                           Contributions.

         [ ]      2.       Participants may make Voluntary After-tax
                           Contributions in any amount from a minimum of
                           ________% to a maximum of ______% of their
                           Compensation or a flat dollar amount from a minimum
                           of $____________ to a -- maximum of $______________.

                  IF RECHARACTERIZATION OF ELECTIVE DEFERRALS HAS BEEN ELECTED
                  AT SECTION XII(D) IN THIS ADOPTION AGREEMENT, VOLUNTARY
                  AFTER-TAX CONTRIBUTIONS MUST BE PERMITTED IN THE PLAN BY
                  COMPLETING THE SECTION ABOVE.

         E.       REQUIRED AFTER-TAX CONTRIBUTIONS (THRIFT SAVINGS PLANS ONLY):

         [X]      1.       The Plan does not permit Required After-tax
                           Contributions.

         [ ]      2.       Participants shall be required to make Required
                           After-tax Contributions as follows:

                  [ ]      a.       ________% of Compensation.

                  [ ]      b.       A percentage determined by the Employee.

         F.       ROLLOVER CONTRIBUTIONS:

         [ ]      1.       The Plan does not accept Rollover Contributions.

                                                     Section 401(k) Plan AA #010

                                       11


         [ ]      2.       Participants may make Rollover Contributions after
                           meeting the eligibility requirements for
                           participation in the Plan.

         [X]      3.       Employees may make Rollover Contributions prior to
                           meeting the eligibility requirements for
                           participation in the Plan.

         G.       ELECTIVE PLAN TO PLAN TRANSFER CONTRIBUTIONS:

         [ ]      1.       The Plan does not accept Transfer Contributions.

         [ ]      2.       Participants may make Transfer Contributions after
                           meeting the eligibility requirements for
                           participation in the Plan.

         [X]      3.       Employees may make Transfer Contributions prior to
                           meeting the eligibility requirements for
                           participation in the Plan.

         H.       CHANGES TO ELECTIVE DEFERRALS:

                  Participants shall be permitted to terminate their Elective
                  Deferrals at any time upon proper and timely notice to the
                  Employer. Modifications to Participants' Elective Deferrals
                  will become effective on a prospective basis as provided for
                  below:

         [ ]      1.       On a daily basis.

         [ ]      2.       Upon _____ (not to exceed 90) days notice to the Plan
                           Administrator.

         [X]      3.       On the first day of each quarter.

         [ ]      4.       On the first day of the next month.

         [ ]      5.       The beginning of the next payroll period.

         I.       REINSTATEMENT OF ELECTIVE DEFERRALS:

                  Participants who terminate their Elective Deferrals shall be
                  permitted to reinstate their Elective Deferrals on a
                  prospective basis as provided for below:

         [ ]      1.       On a daily basis.

         [ ]      2.       Upon _____ (not to exceed 90) days notice to the Plan
                           Administrator.

         [X]      3.       On the first day of each quarter.

         [ ]      4.       On the first day of the next month.

         [ ]      5.       The beginning of the next payroll period.

VII.     SAFE HARBOR PLAN PROVISIONS

[ ]      The Employer elects to comply with the Safe Harbor Cash or Deferred
         Arrangement provisions of Article XI of Basic Plan Document #01 and
         elects one of the following contribution formulas:

         A.       SAFE HARBOR TESTS:

         [ ]      1.       Only the ADP and not the ACP Test Safe Harbor
                           provisions are applicable.

                                                     Section 401(k) Plan AA #010

                                       12


         [ ]      2.       Both the ADP and ACP Test Safe Harbor provisions are
                           applicable. If both ADP and ACP provisions are
                           applicable:

                  [ ]      a.       No additional Matching Contributions will be
                                    made in any Plan Year in which the Safe
                                    Harbor provisions are used.

                  [ ]      b.       The Employer may make Matching Contributions
                                    in addition to any Safe Harbor Matching
                                    Contributions elected below. (Complete
                                    provisions in Article VIII regarding
                                    Matching Contributions that will be made in
                                    addition to those Safe Harbor Matching
                                    Contributions made below.)

[ ]      B.       DESIGNATION OF ALTERNATE PLAN TO RECEIVE SAFE HARBOR
                  CONTRIBUTION:

                  If the Safe Harbor Contribution as elected below is not being
                  made to this Plan, the name of the other plan that will
                  receive the Safe Harbor Contribution is:_____________________

[ ]      C.       BASIC MATCHING CONTRIBUTION FORMULA:

                  Matching Contributions will be made on behalf of Participants
                  in an amount equal to 100% of the amount of the Eligible
                  Participant's Elective Deferrals that do not exceed 3% of the
                  Participant's Compensation and 50% of the amount of the
                  Participant's Elective Deferrals that exceed 3% of the
                  Participant's Compensation but that do not exceed 5% of the
                  Participant's Compensation.

[ ]      D.       ENHANCED MATCHING CONTRIBUTION FORMULA:

                  Matching Contributions will be made in an amount equal to the
                  sum of:

         [ ]      1.       _________% (may not be less than 100%) of the
                           Participant's Elective Deferrals that do not exceed
                           _________% (if more than 6% or if left blank, the ACP
                           Test will apply) of the Participant's Compensation,
                           plus

         [ ]      2.       _________% of the Participant's Elective Deferrals
                           that exceed _________% of the Participant's
                           Compensation but do not exceed _________% (if more
                           than 6% or if left blank the ACP Test will apply) of
                           the Participant's Compensation.

                  This section must be completed so that at any rate of Elective
                  Deferrals, the Matching Contribution is at least equal to the
                  Matching Contribution received if the Employer used the Basic
                  Matching Contribution Formula. The rate of match cannot
                  increase as Elective Deferrals increase. If an additional
                  discretionary match is made, the dollar amount may not exceed
                  4% of the Participant's Compensation.

[ ]      E.       GUARANTEED NON-ELECTIVE CONTRIBUTION FORMULA:

                  The Employer shall make a Non-Elective Contribution equal to
                  _________% (not less than 3%) of the Compensation of each
                  Eligible Participant.

[ ]      F.       FLEXIBLE NON-ELECTIVE CONTRIBUTION FORMULA:

                  This provision provides the Employer with the ability to amend
                  the Plan to comply with the Safe Harbor provisions during the
                  Plan Year. To provide such option, the Employer must amend the
                  Plan and indicate on Schedule D that the Safe Harbor
                  Non-Elective Contribution (not less than 3%) will be made for
                  the specified Plan Year. Such election must comply with all
                  the applicable notice requirements.

                  ADDITIONAL NON-SAFE HARBOR CONTRIBUTIONS MAY BE MADE TO THE
                  PLAN PURSUANT TO ARTICLE XI OF BASIC PLAN DOCUMENT #01.

                                                     Section 401(k) Plan AA #010

                                       13


[ ]      G.       LIMITATIONS ON SAFE HARBOR MATCHING CONTRIBUTIONS:

                  If a Safe Harbor Matching Contribution is made to the Plan:

         [ ]      1.       The Employer will annualize the Safe Harbor Matching
                           Contributions.

         [ ]      2.       The Employer will not annualize the Safe Harbor
                           Matching Contributions and elects to match actual
                           Elective Deferrals made:

                  [ ]      a.       on a  payroll basis.

                  [ ]      b.       on a monthly basis.

                  [ ]      c.       on a Plan Year quarterly basis.

                           If no election is made, the payroll period method
                           will be used. If one of the Matching Contribution
                           calculation periods at Section VII(G)(2) above is
                           selected Matching Contributions must be deposited to
                           the Plan not later than the last day of the calendar
                           quarter next following the quarter following to which
                           they relate.

         IF THE SAFE HARBOR PLAN PROVISIONS ARE ELECTED, THE ANTIDISCRIMINATION
         TESTS AT ARTICLE XI OF THE BASIC PLAN DOCUMENT #01 ARE NOT APPLICABLE.
         SAFE HARBOR CONTRIBUTIONS MADE ARE SUBJECT TO THE WITHDRAWAL
         RESTRICTIONS OF CODE SECTION 401(k)(2)(B) AND TREASURY REGULATIONS
         SECTION 1.401(k)-1(d); SUCH CONTRIBUTIONS (AND EARNINGS THEREON) MUST
         NOT BE DISTRIBUTABLE EARLIER THAN SEPARATION FROM SERVICE, DEATH,
         DISABILITY, AN EVENT DESCRIBED IN CODE SECTION 401(k)(10), OR IN THE
         CASE OF A PROFIT-SHARING OR STOCK BONUS PLAN, THE ATTAINMENT OF AGE
         59 1/2. SAFE HARBOR CONTRIBUTIONS ARE NOT AVAILABLE FOR HARDSHIP
         WITHDRAWALS.

         THE ACP TEST SAFE HARBOR IS AUTOMATICALLY SATISFIED IF THE ONLY
         MATCHING CONTRIBUTION TO THE PLAN IS EITHER A BASIC MATCHING
         CONTRIBUTION OR AN ENHANCED MATCHING CONTRIBUTION THAT DOES NOT PROVIDE
         A MATCH ON ELECTIVE DEFERRALS IN EXCESS OF 6% OF COMPENSATION. FOR
         PLANS THAT ALLOW VOLUNTARY OR REQUIRED AFTER-TAX CONTRIBUTIONS, THE ACP
         TEST IS APPLICABLE WITH REGARD TO SUCH CONTRIBUTIONS.

         EMPLOYEES ELIGIBLE TO MAKE ELECTIVE DEFERRALS TO THIS PLAN MUST BE
         ELIGIBLE TO RECEIVE THE SAFE HARBOR CONTRIBUTION IN THE PLAN LISTED
         ABOVE, TO THE EXTENT REQUIRED BY IRS NOTICES 98-2 AND 2000-3.

                                                     Section 401(k) Plan AA #010

                                       14


VIII.    EMPLOYER CONTRIBUTIONS

         The Employer shall make contributions to the Plan in accordance with
         the formula or formulas selected below. The Employer's contribution
         shall be subject to the limitations contained in Articles III and X.
         For this purpose, a contribution for a Plan Year shall be limited by
         Compensation earned in the Limitation Year which ends with or within
         such Plan Year.

         Do not complete this Section of the Adoption Agreement if the Plan only
         offers a Safe Harbor Contribution. A Plan that offers both a Safe
         Harbor Matching Contribution as well as an additional Matching
         Contribution which is specified below, must complete both Sections VII
         and VIII of the Adoption Agreement.

         A.       MATCHING EMPLOYER CONTRIBUTION:

                  Select the Matching Contribution Formula, Computation Period
                  and special Limitations for each contribution type from the
                  options listed below. Enter the letter of the option(s)
                  selected on the lines provided. Leave the line blank if no
                  election is required.



                  NON-SAFE                                        NON-SAFE
                   HARBOR        MATCHING                          HARBOR        MATCHING
TYPE OF           MATCHING     COMPUTATION                        MATCHING     COMPUTATION
CONTRIBUTION      FORMULA 1       PERIOD         LIMITATIONS      FORMULA 2       PERIOD         LIMITATIONS
- ------------------------------------------------------------------------------------------------------------
                                                                               
Elective               c              g
Deferrals
- ------------------------------------------------------------------------------------------------------------
Voluntary
After-tax
- ------------------------------------------------------------------------------------------------------------
Required
After-tax
- ------------------------------------------------------------------------------------------------------------
403(b)
Deferrals


                  If any election is made with respect to "403(b) Deferrals"
                  above, and if this Plan is used to fund any Employer
                  Contributions, Employer Contributions will be based on the
                  Elective Deferrals made to an existing 403(b) plan sponsored
                  by the Employer.

                  Name of corresponding 403(b) plan:__________________________

                  1.       MATCHING CONTRIBUTION FORMULAS:

                           ELECTIVE DEFERRAL MATCHING CONTRIBUTION FORMULAS:

                           a.       PERCENTAGE OF DEFERRAL MATCH: The Employer
                                    shall contribute to each eligible
                                    Participant's account an amount equal to
                                    _________% of the Participant's Elective
                                    Deferrals up to a maximum of _________% or
                                    $_________ of Compensation.

                           b.       UNIFORM DOLLAR MATCH: The Employer shall
                                    contribute to each eligible Participant's
                                    account $________ if the Participant who
                                    contributes at least ________% or
                                    $__________ of Compensation. The Employer's
                                    contribution will be made up to a maximum of
                                    _____% of Compensation.

                           c.       DISCRETIONARY MATCH: The Employer's Matching
                                    Contribution shall be determined by the
                                    Employer with respect to each Plan Year. The
                                    Matching Contribution shall be contributed
                                    to each eligible Participant in accordance
                                    with the nondiscriminatory formula
                                    determined by the Employer. If this Plan is
                                    also utilizing a Safe Harbor Contribution,
                                    pursuant to Section VII of this Adoption
                                    Agreement, Discretionary Matching
                                    Contributions may not exceed 4% of
                                    Compensation.

                                                     Section 401(k) Plan AA #010

                                       15


                           d.       TIERED MATCH: The Employer shall contribute
                                    to each eligible Participant's account an
                                    amount equal to:

                                    ________% of the first ________% of the
                                    Participant's Compensation contributed, and

                                    ________% of the next ________% of the
                                    Participant's Compensation contributed, and

                                    ________% of the next ________% of the
                                    Participant's Compensation contributed.

                                    The Employer's contribution will be made up
                                    to the [ ] greater of [ ] lesser of
                                    _________% of Compensation, or $__________.

                                    THE PERCENTAGES SPECIFIED ABOVE MAY NOT
                                    INCREASE AS THE PERCENTAGE OF PARTICIPANT'S
                                    CONTRIBUTION INCREASES.

                           e.       PERCENTAGE OF COMPENSATION MATCH: The
                                    Employer shall contribute to each eligible
                                    Participant's account ________% of
                                    Compensation if the eligible Participant
                                    contributes at least ________% of
                                    Compensation.

                                    The Employer's contribution will be made up
                                    to the [ ] greater of [ ] lesser of
                                    _________% of Compensation, or $__________.

                           f.       PROPORTIONATE COMPENSATION MATCH: The
                                    Employer shall contribute to each eligible
                                    Participant who defers at least ________% of
                                    Compensation, an amount determined by
                                    multiplying such Employer Matching
                                    Contribution by a fraction, the numerator of
                                    which is the Participant's Compensation and
                                    the denominator of which is the Compensation
                                    of all Participants eligible to receive such
                                    an allocation.

                                    The Employer's contribution will be made up
                                    to the [ ] greater of [ ] lesser of
                                    _________% of Compensation, or $__________.

                           g.       LENGTH OF SERVICE MATCH: The Employer shall
                                    make Matching Contributions equal to the
                                    formula determined under the following
                                    schedule:



Participant's Total                         Matching
Years of Service                            Contribution Formula
- -------------------                         --------------------
                                         
______________                              ___________________________
______________                              ___________________________
______________                              ___________________________


                                    EACH SEPARATE MATCHING PERCENTAGE
                                    CONTRIBUTION MUST SATISFY CODE SECTION
                                    401(a)(4) NONDISCRIMINATION REQUIREMENTS AND
                                    THE ACP TEST.

                           VOLUNTARY AFTER-TAX MATCHING CONTRIBUTION FORMULAS:

                           h.       PERCENTAGE OF DEFERRAL MATCH: The Employer
                                    shall contribute to each eligible
                                    Participant's account an amount equal to
                                    ______% of the Participant's Voluntary
                                    After-tax Contributions up to a maximum of
                                    ______% or $__________ of Compensation.

                           i.       UNIFORM DOLLAR MATCH: The Employer shall
                                    contribute to each eligible Participant's
                                    account $________ if the Participant at
                                    contributes least ________% or $________ of
                                    Compensation. The Employer's contribution
                                    will be made up to a maximum of _____% of
                                    Compensation.

                                                     Section 401(k) Plan AA #010

                                       16


                           j.       DISCRETIONARY MATCH: The Employer's Matching
                                    Contribution shall be determined by the
                                    Employer with respect to each Plan Year. The
                                    Matching Contribution shall be contributed
                                    to each eligible Participant in accordance
                                    with the nondiscriminatory formula
                                    determined by the Employer.

                           REQUIRED AFTER-TAX MATCHING CONTRIBUTION FORMULAS:

                           k.       PERCENTAGE OF DEFERRAL MATCH: The Employer
                                    shall contribute to each eligible
                                    Participant's account an amount equal to
                                    ________% of the Participant's Required
                                    After-tax Contributions up to a maximum of
                                    ________% or $__________ of Compensation.

                           l.       UNIFORM DOLLAR MATCH: The Employer shall
                                    contribute to each eligible Participant's
                                    account $________ if the Participant
                                    contributes at least _______% or $__________
                                    of Compensation. The Employer's contribution
                                    will be made up to a maximum of ______% of
                                    Compensation.

                           m.       DISCRETIONARY MATCH: The Employer's Matching
                                    Contribution shall be determined by the
                                    Employer with respect to each Plan Year. The
                                    Matching Contribution shall be contributed
                                    to each eligible Participant in accordance
                                    with the nondiscriminatory formula
                                    determined by the Employer.

                           IF THE MATCHING CONTRIBUTION FORMULA SELECTED BY THE
                           EMPLOYER IS 100% VESTED AND MAY NOT BE DISTRIBUTED TO
                           THE PARTICIPANT BEFORE THE EARLIER OF THE DATE THE
                           PARTICIPANT SEPARATES FROM SERVICE, RETIRES, BECOMES
                           DISABLED, ATTAINS 59-1/2, OR DIES, IT MAY BE TREATED
                           AS A QUALIFIED MATCHING CONTRIBUTION.

                           403(b)   MATCHING CONTRIBUTION FORMULAS:

                           n.       PERCENTAGE OF DEFERRAL MATCH: The Employer
                                    shall contribute to each eligible
                                    Participant's account an amount equal to
                                    ________% of the Participant's 403(b)
                                    Deferrals up to a maximum of ________% or
                                    $__________ of Compensation.

                           o.       UNIFORM DOLLAR MATCH: The Employer shall
                                    contribute to each eligible Participant's
                                    account $________ if the Participant
                                    contributes at least ______% or $___________
                                    of Compensation. The Employer's contribution
                                    will be made up to a maximum of ______% of
                                    Compensation.

                           p.       DISCRETIONARY MATCH: The Employer's Matching
                                    Contribution shall be determined by the
                                    Employer with respect to each Plan Year. The
                                    Matching Contribution shall be contributed
                                    to each eligible Participant in accordance
                                    with the nondiscriminatory formula
                                    determined by the Employer.

                  2.       MATCHING CONTRIBUTION COMPUTATION PERIOD: The
                           Compensation or any dollar limitation imposed in
                           calculating the match will be based on the period
                           selected below. Matching Contributions will be
                           calculated on the following basis:

                           a. Weekly                    e. Quarterly

                           b. Bi-weekly                 f. Semi-annually

                           c. Semi-monthly              g. Annually

                           d. Monthly                   h. Payroll Based

                           The calculation of Matching Contributions based on
                           the Computation Period selected above has no
                           applicability as to when the Employer remits Matching
                           Contributions to the Trust.

                                                     Section 401(k) Plan AA #010

                                       17


                  3.       LIMITATIONS ON MATCHING FORMULAS:

                           a.       ANNUALIZATION OF MATCHING CONTRIBUTIONS. The
                                    Employer elects to annualize Matching
                                    Contributions made to the Plan.

                                    IF THIS ELECTION IS NOT MADE, MATCHING
                                    CONTRIBUTIONS WILL NOT BE ANNUALIZED.

                           b.       CONTRIBUTIONS TO PARTICIPANTS WHO ARE NOT
                                    HIGHLY COMPENSATED EMPLOYEES: Contribution
                                    of the Employer's Matching Contribution will
                                    be made only to eligible Participants who
                                    are Non-Highly Compensated Employees.

                           c.       DEFERRALS WITHDRAWN PRIOR TO THE END OF THE
                                    MATCHING COMPUTATION PERIOD: Matching
                                    Contributions (whether or not Qualified)
                                    will not be made on Employee contributions
                                    withdrawn prior to the end of the [ ]
                                    Matching Computation Period, or [ ] Plan
                                    Year.

                                    If elected [ ], this requirement shall apply
                                    in the event of a withdrawal occurring as
                                    the result of a termination of employment
                                    for reasons of retirement, Disability or
                                    death.

                  4.       QUALIFIED MATCHING CONTRIBUTIONS (QMAC):

                  [ ]      a.       For purposes of the ADP or ACP Test,
                                    all Matching Contributions made to the Plan
                                    will be deemed "Qualified" for purposes of
                                    calculating the Actual Deferral Percentage
                                    and/or Actual Contribution Percentage. All
                                    Matching Contributions must be fully vested
                                    when made and are not available for
                                    in-service withdrawal.

                  [ ]      b.       For purposes of the ADP or ACP Test,
                                    only Matching Contributions made to the Plan
                                    that are needed to meet the Actual Deferral
                                    Percentage or Actual Contribution Percentage
                                    Test will be deemed "Qualified" for purposes
                                    of calculating the Actual Deferral
                                    Percentage and/or Actual Contribution
                                    Percentage. All such Matching Contributions
                                    used must be fully vested when made and are
                                    not available for in-service withdrawal.

                  5.       QUALIFIED NON-ELECTIVE CONTRIBUTIONS (QNEC):

                  [ ]      a.       For purposes of the ADP or ACP Test, all
                                    Non-Elective Contributions made to the Plan
                                    will be deemed "Qualified" for purposes of
                                    calculating the Actual Deferral Percentage
                                    and/or Actual Contribution Percentage. All
                                    Non-Elective Contributions must be fully
                                    vested when made and are not available for
                                    in-service withdrawal.

                  [ ]      b.       For purposes of the ADP or ACP Test, only
                                    the Non-Elective Contributions made to the
                                    Plan that are needed to meet the Actual
                                    Deferral Percentage or Actual Contribution
                                    Percentage Test will be deemed "Qualified"
                                    for purposes of calculating the Actual
                                    Deferral Percentage and/or Actual
                                    Contribution Percentage. All such
                                    Non-Elective Contributions used must be
                                    fully vested when made and are not available
                                    for in-service withdrawal.

         B.       QUALIFIED MATCHING (QMAC) AND QUALIFIED NON-ELECTIVE (QNEC)
                  EMPLOYER CONTRIBUTION FORMULAS:

         [ ]      1.       QMAC CONTRIBUTION FORMULA:  The Employer may
                           contribute to each eligible Participant's Qualified
                           Matching account an amount equal to (select one or
                           more of the following):

                  [ ]      a.       $________ or _______% of the Participant's
                                    Elective Deferrals.

                  [ ]      b.       $________ or _______% of the Participant's
                                    Voluntary After-tax Contributions.

                  [ ]      c.       $________ or _______% of the Participant's
                                    Required After-tax Contributions.

                                                     Section 401(k) Plan AA #010

                                       18


         [X]      2.       DISCRETIONARY QMAC CONTRIBUTION FORMULA: The Employer
                           shall have the right to make a discretionary QMAC
                           contribution. The Employer's Matching Contribution
                           shall be determined by the Employer with respect to
                           each Plan Year's eligible Participants. This part of
                           the Employer's contribution shall be fully vested
                           when made.

         [X]      3.       DISCRETIONARY PERCENTAGE QNEC CONTRIBUTION FORMULA:
                           The Employer shall have the right to make a
                           discretionary QNEC contribution which shall be
                           allocated to each eligible Participant's account in
                           proportion to his or her Compensation as a percentage
                           of the Compensation of all eligible Participants.
                           This part of the Employer's contribution shall be
                           fully vested when made. This contribution will be
                           made to:

                  [ ]      a.       All eligible Participants.

                  [X]      b.       Only eligible Participants who are
                                    Non-Highly Compensated Employees.

         [X]      4.       DISCRETIONARY UNIFORM DOLLAR QNEC CONTRIBUTION
                           FORMULA: The Employer shall have the right to make a
                           discretionary QNEC contribution which shall be
                           allocated to each eligible Participant's account in a
                           uniform dollar amount to be determined by the
                           Employer and allocated in a nondiscriminatory manner.
                           This part of the Employer's contribution shall be
                           fully vested when made and not available for
                           in-service withdrawal. This contribution will be made
                           to:

                  [ ]      a.       All eligible Participants.

                  [X]      b.       Only eligible Participants who are
                                    Non-Highly Compensated Employees.

         [X]      5.       CORRECTIVE QNEC CONTRIBUTION FORMULA: The Employer
                           shall have the right to make a QNEC contribution in
                           the amount necessary to pass the ADP/ACP Test or the
                           maximum permitted under Code Section 415. This
                           contribution will be allocated to some or all
                           Non-Highly Compensated Participants designated by the
                           Plan Administrator. The allocation will be the lesser
                           of the amount required to pass the ADP/ACP Test, or
                           the maximum permitted under Code Section 415 and is
                           not available for in-service withdrawal. This part of
                           the Employer's contribution shall be fully vested
                           when made.

[ ]      C.       DISCRETIONARY EMPLOYER CONTRIBUTION - NON-INTEGRATED FORMULA:
                  The Employer shall have the right to make a discretionary
                  contribution. The Employer's contribution for the Plan Year
                  shall be made to the accounts of eligible Participants as
                  follows:

         [ ]      1.       Such contribution shall be allocated as a percentage
                           of the Employer's Net Profits.

         [ ]      2.       Such contribution shall be allocated as a percentage
                           of Compensation of eligible Participants for the Plan
                           Year.

         [ ]      3.       Such contribution shall be allocated in an amount
                           fixed by an appropriate action of the Employer as of
                           the time prescribed by law.

         [ ]      4.       Such contribution shall be allocated equally in a
                           uniform dollar amount to each eligible Participant.

         [ ]      5.       Such contribution shall be allocated in the same
                           dollar amount to each eligible Participant per Hour
                           of Service the Participant is entitled to
                           Compensation.

[ ]      D.       DISCRETIONARY EMPLOYER CONTRIBUTION - EXCESS INTEGRATED
                  ALLOCATION FORMULA: The Employer shall have the right to make
                  a discretionary contribution. The Employer's contribution for
                  the Plan Year shall be allocated to the accounts of eligible
                  Participants as follows:

                  ONLY ONE PLAN MAINTAINED BY THE EMPLOYER MAY BE INTEGRATED
                  WITH SOCIAL SECURITY. ANY PLAN UTILIZING A SAFE HARBOR FORMULA
                  PROVIDED IN SECTION VII OF THIS ADOPTION AGREEMENT MAY NOT
                  APPLY THE SAFE HARBOR CONTRIBUTION TO THE INTEGRATED
                  ALLOCATION FORMULA. IF THE PLAN IS NOT TOP-HEAVY OR IF THE
                  TOP-HEAVY MINIMUM CONTRIBUTION OR BENEFIT IS PROVIDED UNDER
                  ANOTHER PLAN COVERING THE SAME EMPLOYEES, PARAGRAPHS (1) AND
                  (2) BELOW MAY BE

                                                     Section 401(k) Plan AA #010

                                       19


                  DISREGARDED AND 5.7%, 5.4% OR 4.3% MAY BE SUBSTITUTED FOR
                  2.7%, 2.4% OR 1.3% WHERE IT APPEARS IN PARAGRAPH (3) BELOW.

                  1.       Step One: To the extent contributions are sufficient,
                           all Participants will receive an allocation equal to
                           3% of their Compensation.

                  2.       Step Two: Any remaining Employer contributions will
                           be allocated up to a maximum of 3% of excess
                           Compensation of all Participants to Participants who
                           have Compensation in excess of the Integration Level
                           (excess Compensation). Each such Participant will
                           receive an allocation in the ratio that his or her
                           excess Compensation bears to the excess Compensation
                           of all Participants. If Employer contributions are
                           insufficient to fund to this level, the Employer must
                           determine the uniform allocation percentage to
                           allocate to those Participants who have Compensation
                           in excess of the Integration Level. To determine this
                           uniform allocation percentage, the Employer must take
                           the remaining contribution and divide that amount by
                           the total excess Compensation of Participants.

                  3.       Step Three: Any remaining Employer contributions will
                           be allocated to all Participants in the ratio that
                           their Compensation plus excess Compensation bears to
                           the total Compensation plus excess Compensation of
                           all Participants. Participants may only receive an
                           allocation of up to 2.7% of their Compensation plus
                           excess Compensation, under this allocation step. If
                           the Integration Level defined at Section III(E) is
                           less than or equal to the greater of $10,000 or 20%
                           of the maximum, the 2.7% need not be reduced. If the
                           amount specified is greater than the greater of
                           $10,000 or 20% of the maximum Taxable Wage Base, but
                           not more than 80%, 2.7% must be reduced to 1.3%. If
                           the amount specified is greater than 80% but less
                           than 100% of the maximum Taxable Wage Base, the 2.7%
                           must be reduced to 2.4%. If Employer contributions
                           are insufficient to fund to this level, the Employer
                           must determine the uniform allocation percentage to
                           allocate to those Participants who have Compensation
                           up to the Integration Level and excess Compensation.
                           To determine this uniform allocation percentage, the
                           Employer must take the remaining contribution and
                           divide that amount by the total Compensation
                           including excess Compensation of Participants.

                  4.       Step Four: Any remaining Employer contributions will
                           be allocated to all Participants in the ratio that
                           each Participant's Compensation bears to all
                           Participants' Compensation.

[ ]      E.       DISCRETIONARY EMPLOYER CONTRIBUTION - BASE INTEGRATED
                  ALLOCATION FORMULA: The Employer shall have the right to make
                  a discretionary contribution. To the extent that such
                  contributions are sufficient, they shall be allocated as
                  follows:

                  ________% of each eligible Participant's Compensation, plus

                  ________% of Compensation in excess of the Integration Level
                  defined at Section III(E) hereof.

                  The percentage of excess Compensation may not exceed the
                  lesser of (i) the amount first specified in this paragraph or
                  (ii) the greater of 5.7% or the percentage rate of tax under
                  Code Section 3111(a) as in effect on the first day of the Plan
                  Year attributable to the Old Age (OA) portion of the OASDI
                  provisions of the Social Security Act. If the Employer
                  specifies an Integration Level in Section III(E) which is
                  lower than the Taxable Wage Base for Social Security purposes
                  (SSTWB) in effect as of the first day of the Plan Year, the
                  percentage contributed with respect to excess Compensation
                  must be adjusted. If the Plan's Integration Level is greater
                  than the larger of $10,000 or 20% of the SSTWB but not more
                  than 80% of the SSTWB, the excess percentage is 4.3%. If the
                  Plan's Integration Level is greater than 80% of the SSTWB but
                  less than 100% of the SSTWB, the excess percentage is 5.4%.

                  ONLY ONE PLAN MAINTAINED BY THE EMPLOYER MAY BE INTEGRATED
                  WITH SOCIAL SECURITY. ANY PLAN UTILIZING A SAFE HARBOR FORMULA
                  AS PROVIDED IN SECTION VII OF THIS ADOPTION AGREEMENT MAY NOT
                  APPLY THE SAFE HARBOR CONTRIBUTIONS TO THE INTEGRATED
                  ALLOCATION FORMULA.

[ ]      F.       UNIFORM POINTS ALLOCATION FORMULA: The allocation for each
                  eligible Participant will be determined by a uniform points
                  method. Each eligible Participant's allocation shall bear the
                  same

                                                     Section 401(k) Plan AA #010

                                       20


                  relationship to the Employer contribution as the Participant's
                  total points bears to all points awarded. Each eligible
                  Participant will receive _____ points for each of the
                  following:

         [ ]      1.       _____ year(s) of age.

         [ ]      2.       _____ Year(s) of Service determined:

                  [ ]      a.       In the same manner as determined for
                                    eligibility.

                  [ ]      b.       In the same manner as determined for
                                    vesting.

                  [ ]      c.       Points will not be awarded with respect to
                                    Year(s) of Service in excess of _____.

         [ ]      3.       $_________ (not to exceed $200) of Compensation.

[X]      G.       ADDITIONAL ADOPTING EMPLOYERS:

         [X]      1.       All participating Employers' contributions under
                           Section VIII entitled "Employer Contributions" above
                           and forfeitures, if applicable, attributable to each
                           specific contribution source shall be pooled together
                           and allocated uniformly among all eligible
                           Participants.

         [ ]      2.       Each participating Employer's contribution under
                           Section VIII above and forfeitures attributable to
                           each specific contribution source made by such
                           Employer shall be allocated only to eligible
                           Participants of the participating Employer.

                  WHERE CONTRIBUTIONS AND FORFEITURES ARE TO BE ALLOCATED TO
                  ELIGIBLE PARTICIPANTS BY PARTICIPATING EMPLOYERS, EACH SUCH
                  EMPLOYER MUST MAINTAIN DATA DEMONSTRATING THAT THE ALLOCATIONS
                  BY GROUP SATISFY THE NONDISCRIMINATION RULES UNDER CODE
                  SECTION 401(a)(4).

[X]      H.       MINIMUM EMPLOYER CONTRIBUTION FORMULA UNDER TOP-HEAVY PLANS:

                  For any Plan Year during which the Plan is Top-Heavy, the sum
                  of the contributions (excluding Elective Deferrals and/or
                  Matching Contributions) allocated to non-Key Employees shall
                  not be less than the amount required under the Basic Plan
                  Document #01. The eligibility of a Participant to receive
                  Top-Heavy Contributions mirrors the eligibility for any
                  contribution with the earliest Entry Date. Top-Heavy minimums
                  will be allocated to:

         [ ]      1.       all eligible Participants.

         [X]      2.       only eligible non-Key Employees who are Participants.

IX.      ALLOCATIONS TO PARTICIPANTS

         A.       THIS IS A SAFE HARBOR PLAN:

         [ ]      Employer Non-Elective and/or Matching Contributions will be
                  made to all Employees who have satisfied the Safe Harbor
                  eligibility requirements.

         B.       ALLOCATION ACCRUAL REQUIREMENTS:

                  A Year of Service for eligibility to receive an allocation of
                  Employer contributions will be determined on the basis of the:

         [ ]      1.       Elapsed Time method.

                                                     Section 401(k) Plan AA #010

                                       21


         [ ]      2.       Hours of Service method. A Year of Service will
                           be credited upon completion of the requirements
                           below. A Year of Service for allocation accrual
                           purposes cannot be less than 1 Hour of Service nor
                           greater than 1,000 hours by operation of law. If left
                           blank, the Plan will use 1,000 hours. ENTER WHOLE
                           DIGIT NUMBERS ONLY.

                           a.       Active Participants:



CONTRIBUTION TYPE                       HOURS OF SERVICE REQUIREMENT
- --------------------------------------------------------------------
                                     
All contributions
Non-Safe Harbor Match Formula 1
Employer Discretionary
QNECs
QMACs
Non-Safe Harbor Match Formula 2


                           b.       Terminated Participants:



CONTRIBUTION TYPE                       HOURS OF SERVICE REQUIREMENT
- --------------------------------------------------------------------
                                     
All contributions
Non-Safe Harbor Match Formula 1
Employer Discretionary
QNECs
QMACs
Non-Safe Harbor Match Formula 2


         C.       ALLOCATION OF CONTRIBUTIONS TO PARTICIPANTS:

                  Employer contributions for a Plan Year will be allocated to
                  all Participants who have met the allocation accrual
                  requirements at Section IX(B) above and who have met the
                  following allocation accrual requirements (check all
                  applicable boxes):



                                               Match       Match
                                             Formula 1    Formula 2     QNEC       QMAC      Discretionary
                                             ---------    ---------     ----       ----      -------------
                                                                              
1.  For Plans using the Elapsed Time
    method, contributions will be
    allocated to terminated
    Participants who have
    completed __________

    (not more than 12) months
    of Service                                   [ ]        [ ]          [ ]        [ ]           [ ]

2.  Employed on the last day
    of the Plan Year                             [ ]        [ ]          [ ]        [ ]           [ ]

3.  The Hours of Service or Period
    of Service requirement in the
    Plan Year of termination is
    waived due to:

    a.   Retirement                              [ ]        [ ]          [ ]        [ ]           [ ]

    b.   Disability                              [ ]        [ ]          [ ]        [ ]           [ ]

    c.   Death                                   [ ]        [ ]          [ ]        [ ]           [ ]

    d.   Other                                   [ ]        [ ]          [ ]        [ ]           [ ]

         _________________________*

    e.   No last day of the Plan
         Year requirement in Plan
         Year of any of the above
         events                                  [ ]        [ ]          [ ]        [ ]           [ ]


                                                     Section 401(k) Plan AA #010

                                       22


                  *        The event designated by the Employer may be applied
                           to all Participants in a nondiscriminatory manner.

[ ]      D.       CONTRIBUTIONS TO DISABLED PARTICIPANTS:

                  The Employer will make contributions on behalf of a
                  Participant who is permanently and totally disabled. These
                  contributions will be based on the Compensation each such
                  Participant would have received for the Limitation Year if the
                  Participant had been paid at the rate of Compensation paid
                  immediately before becoming permanently and totally disabled.
                  Such imputed Compensation for the disabled Participant may be
                  taken into account only if the Participant is not a Highly
                  Compensated Employee. These contributions will be 100% vested
                  when made.

X.       DISPOSITION OF FORFEITURES

[ ]      A.       NOT APPLICABLE.  All contributions are fully vested.

                  If (A) is selected, do not complete (B) or (C) below.

         B.       FORFEITURE ALLOCATION ALTERNATIVES:

                  Select the method in which forfeitures associated with the
                  contribution type will be allocated (number each item in order
                  of use).



                                                           Employer Contribution Type
                                                           --------------------------
                                                       All Non-Safe Harbor       All Other
Disposition Method                                   Matching Contributions    Contributions
- ------------------                                   ----------------------    -------------
                                                                         
1.  Restoration of Participant's forfeitures.            1_____________         ___________

2.  Used to reduce the Employer's
    contribution under the Plan.                          _____________         ___________

3.  Used to reduce the Employer's
    Matching Contribution.                               3_____________         ___________

4.  Used to offset Plan expenses.                        2_____________         ___________

5.  Added to the Employer's contribution
    (other than Matching) under the Plan.                ______________         ___________

6.  Added to the Employer's Matching
    Contribution under the Plan.                         ______________         ___________

7.  Allocate to all Participants
    eligible to share in the
    allocations in the same proportion
    that each Participant's Compensation
    for the year bears to the
    Compensation of all other
    Participant's for such year.                         ______________         ___________

8.  Allocate to all NHCEs eligible to
    share in the allocations in
    proportion to each such
    Participant's Compensation for the
    year.                                                ______________         ___________

9.  Allocate to all NHCEs eligible to
    share in the allocations in
    proportion to each such
    Participant's Elective Deferrals for
    the year.                                            ______________         ___________

10. Allocate to all Participants
    eligible to share in the allocations
    in the same proportion that


                                                     Section 401(k) Plan AA #010

                                       23


                                                                      
each  Participant's Elective
Deferrals for  the year bears to the
Elective Deferrals of all
Participants for such year.                          ______________         ___________



                  Participants eligible to share in the allocation of other
                  Employer Contributions under Section VIII shall be eligible to
                  share in the allocation of forfeitures except where
                  allocations are only to Non-Highly Compensated Employees.

         C.       TIMING OF ALLOCATION OF FORFEITURES:

                  If no distribution or deemed distribution has been made to a
                  former Participant, nonvested portions shall be forfeited at
                  the end of the Plan Year during which the former Participant
                  incurs his or her fifth consecutive one-year Break in Service.

                  If a former Participant has received the full amount of his or
                  her vested interest, the nonvested portion of his or her
                  account shall be forfeited and shall be disposed of:

         [ ]      1.       during the Plan Year following the Plan Year in which
                           the forfeiture arose.

         [X]      2.       as of any Valuation or Allocation Date during the
                           Plan Year (or as soon as administratively feasible
                           following the close of the Plan Year) in which the
                           former Participant receives payment of his or her
                           vested benefit.

         [ ]      3.       at the end of the Plan Year during which the former
                           Participant incurs his or her ___________ (1st, 2nd,
                           3rd, 4th or 5th) consecutive one-year Break in
                           Service.

         [ ]      4.       as of the end of the Plan Year during which the
                           former Participant received full payment of his or
                           her vested benefit.

         [ ]      5.       as of the earlier of the first day of the Plan Year,
                           or the first day of the seventh month of the Plan
                           Year following the date on which the former
                           Participant has received full payment of his or her
                           vested benefit.

         [ ]      6.       as of the next Valuation or Allocation Date following
                           the date on which the former Participant receives
                           full payment of his or her vested benefit.

XI.      MULTIPLE PLANS MAINTAINED BY THE EMPLOYER, LIMITATIONS ON ALLOCATIONS,
         AND TOP-HEAVY CONTRIBUTIONS

         A.       PLANS MAINTAINED BY THE EMPLOYER:

         [X]      1.       This is the only Plan the Employer maintains. In
                           the event that the allocation formula results in an
                           Excess Amount, such excess, after distribution of
                           Employee contributions pursuant to paragraph 10.2 of
                           the Basic Plan Document #01, shall be:

                  [ ]      a.       Placed in a suspense account for the benefit
                                    of the Participant without the crediting of
                                    gains or losses for the benefit of the
                                    Participant.

                  [X]      b.       Reallocated as additional Employer
                                    contributions to all other Participants to
                                    the extent that they do not have any Excess
                                    Amount.

                  IF NO METHOD IS SPECIFIED, THE SUSPENSE ACCOUNT METHOD WILL BE
USED.

                                                     Section 401(k) Plan AA #010

                                       24



         [ ]      2.       The Employer does maintain another Plan
                           [including a Welfare Benefit Fund or an individual
                           medical account as defined in Code Section
                           415(l)(2)], under which amounts are treated as Annual
                           Additions and has completed the proper sections
                           below.

                           a.       If the Participant is covered under another
                                    qualified Defined Contribution Plan
                                    maintained by the Employer, other than a
                                    Master or Prototype Plan:

                           [ ]      i.      The provisions of Article X of
                                            the Basic Plan Document #01 will
                                            apply as if the other plan were a
                                            Master or Prototype Plan.

                           [ ]      ii.     The Employer has specified
                                            below the method under which the
                                            plans will limit total Annual
                                            Additions to the Maximum Permissible
                                            Amount, and will properly reduce any
                                            Excess Amounts in a manner that
                                            precludes Employer discretion.

                                            ____________________________________
                                            ____________________________________
                                            ____________________________________

                                    EMPLOYERS WHO MAINTAINED A QUALIFIED DEFINED
                                    BENEFIT PLAN, PRIOR TO JANUARY 1, 2000,
                                    SHOULD COMPLETE SCHEDULE C TO DOCUMENT THE
                                    PREAMENDMENT OPERATION OF THE PLAN.

                           b.       Allocation of Excess Annual Additions: In
                                    the event that the allocation formula
                                    results in an Excess Amount, such excess,
                                    after distribution of Employee
                                    contributions, shall be:

                           [ ]      i.      Placed in a suspense account for the
                                            benefit of the Participant without
                                            the crediting of gains or losses for
                                            the benefit of the Participant.

                           [ ]      ii.     Reallocated as additional Employer
                                            contributions to all other
                                            Participants to the extent that they
                                            do not have any Excess Amount.

                           IF NO METHOD IS SPECIFIED, THE SUSPENSE ACCOUNT
                           METHOD WILL BE USED.

         B.       TOP-HEAVY PROVISIONS:

                  In the event the Plan is or becomes Top-Heavy, the minimum
                  contribution or benefit required under Code Section 416
                  relating to Top-Heavy Plans shall be satisfied in the elected
                  manner:

         [X]      1.       This is the only Plan the Employer maintains or
                           ever maintained. The minimum contribution will be
                           satisfied by this Plan.

         [ ]      2.       The Employer does maintain another Defined
                           Contribution Plan. The minimum contribution will be
                           satisfied by:

                  [ ]      a.       this Plan.

                  [ ]      b.       ___________________________________________
                                    (Name of other Qualified Plan)

         [ ]      3.       The Employer maintains a Defined Benefit Plan.  A
                           method is stated below under which the minimum
                           contribution and benefit provisions of Code Section
                           416 will be satisfied.
                           ____________________________________________________
                           ____________________________________________________

                                                     Section 401(k) Plan AA #010

                                       25


XII.     ANTIDISCRIMINATION TESTING

         FOR PLANS WHICH ARE BEING AMENDED AND RESTATED FOR GUST, PLEASE
         COMPLETE SCHEDULE C OUTLINING THE PREAMENDMENT OPERATION OF THE PLAN,
         AS WELL AS THIS SECTION OF THE ADOPTION AGREEMENT. THE TESTING
         ELECTIONS MADE BELOW WILL APPLY TO THE FUTURE OPERATION OF THE PLAN.

[ ]      A.       The Plan is not subject to ADP or ACP testing. The Plan
                  does not offer Voluntary After-tax or Required After-tax
                  Contributions and it either meets the Safe Harbor provisions
                  of Section VII of this Adoption Agreement, or it does not
                  benefit any Highly Compensated Employees.

[X]      B.       TESTING ELECTIONS:

         [X]      1.       This Plan is using the Prior Year testing method for
                           purposes of the ADP and ACP Tests.

         [ ]      2.       This Plan is using the Current Year testing method
                           for purposes of the ADP and ACP Tests.

                  IF NO ELECTION IS MADE, THE PLAN WILL USE THE CURRENT YEAR
                  TESTING METHOD.

                  This election cannot be rescinded for a Plan Year unless (1)
                  the Plan has been using the Current Year testing method for
                  the preceding 5 Plan Years or, if lesser, the number of Plan
                  Years the Plan has been in existence; or (2) the Plan
                  otherwise meets one of the conditions specified in IRS Notice
                  98-1 (or other superseding guidance) for changing from the
                  Current Year testing method.

                  A PROTOTYPE PLAN MUST USE THE SAME TESTING METHOD FOR BOTH THE
                  ADP AND ACP TESTS FOR PLAN YEARS BEGINNING ON OR AFTER THE
                  DATE THE EMPLOYER ADOPTS ITS GUST-RESTATED PLAN DOCUMENT.

[ ]      C.       TESTING ELECTIONS FOR THE FIRST PLAN YEAR:

                  COMPLETE ONLY WHEN PRIOR YEAR TESTING METHOD ELECTION IS MADE.

         [ ]      1.       If this is not a successor Plan, then for the first
                           Plan Year this Plan permits (a) any Participant to
                           make Employee contributions, (b) provides for
                           Matching Contributions or (c) both, the ACP used in
                           the ACP Test for Participants who are Non-Highly
                           Compensated Employees shall be such first Plan Year's
                           ACP. DO NOT SELECT THIS OPTION IF THE EMPLOYER IS
                           USING THE "DEEMED 3%" RULE.

         [ ]      2.       If this is not a successor Plan, then for the first
                           Plan Year this Plan permits any Participant to make
                           Elective Deferrals, the ADP used in the ADP Test for
                           Participants who are Non-Highly Compensated Employees
                           shall be such first Plan Year's ADP. DO NOT SELECT
                           THIS OPTION IF THE EMPLOYER IS USING THE "DEEMED 3%"
                           RULE.

[ ]      D.       RECHARACTERIZATION:

                  Elective Deferrals may be recharacterized as Voluntary
                  After-tax Contributions to satisfy the ADP Test. The Employer
                  must have elected to permit Voluntary After-tax Contributions
                  in the Plan for this election to be operable.

XIII.    VESTING

         Participants shall always have a fully vested and nonforfeitable
         interest in their Employee contributions (including Elective Deferrals,
         Required After-tax and Voluntary After-tax Contributions), Qualified
         Matching Contributions ("QMACs"), Qualified Non-Elective Contributions
         ("QNECs") or Safe Harbor Matching or Non-Elective Contributions and
         their investment earnings.

         Each Participant shall acquire a vested and nonforfeitable percentage
         in his or her account balance attributable to Employer contributions
         and their earnings under the schedule(s) selected below except in any
         Plan Year during which the Plan is determined to be Top-Heavy. In any
         Plan Year in which the Plan is Top-Heavy, the Two-twenty vesting
         schedule [option (B)(4)] or the three-year cliff schedule [option
         (B)(3)] shall automatically apply unless the Employer has already
         elected a faster vesting schedule. If the Plan is

                                                     Section 401(k) Plan AA #010

                                       26


         switched to option (B)(4) or (B)(3), because of its Top-Heavy status,
         that vesting schedule will remain in effect even if the Plan later
         becomes non-Top-Heavy until the Employer executes an amendment of this
         Adoption Agreement.

         A.       VESTING COMPUTATION PERIOD:

                  A Year of Service for vesting will be determined on the basis
                  of the (choose one):

         [ ]      1.       Not applicable.  All contributions are fully vested.

         [ ]      2.       Elapsed Time method.

         [X]      3.       Hours of Service method. A Year of Service will be
                           credited upon completion of 1000 Hours of Service. A
                           Year of Service for vesting purposes will not be less
                           than 1 Hour of Service nor greater than 1,000 hours
                           by operation of law. If left blank, the Plan will use
                           1,000 hours.

                  The computation period for purposes of determining Years of
                  Service and Breaks in Service for purposes of computing a
                  Participant's nonforfeitable right to his or her account
                  balance derived from Employer contributions:

         [ ]      4.       shall not be applicable since Participants are always
                           fully vested.

         [ ]      5.       shall not be applicable, as the Plan is using Elapsed
                           Time.

         [ ]      6.       shall commence on the date on which an Employee first
                           performs an Hour of Service for the Employer and each
                           subsequent 12-consecutive month period shall commence
                           on the anniversary thereof.

         [X]      7.       shall commence on the first day of the Plan Year
                           during which an Employee first performs an Hour of
                           Service for the Employer and each subsequent
                           12-consecutive month period shall commence on the
                           anniversary thereof.

                  For Plans not using Elapsed Time, a Participant shall receive
                  credit for a Year of Service if he or she completes the number
                  of hours specified above at any time during the 12-consecutive
                  month computation period. A Year of Service may be earned
                  prior to the end of the 12-consecutive month computation
                  period and the Participant need not be employed at the end of
                  the 12-consecutive month computation period to receive credit
                  for a Year of Service.

         B.       VESTING SCHEDULES:

                  Select the appropriate schedule for each contribution type and
                  complete any blank vesting percentages from the list below and
                  insert the option number in the vesting schedule chart below.

                                              Years of Service
                           -----------------------------------------------------
                           1        2       3       4       5       6       7
                           --       --      --      --      --      --     --

                  1.       Full and immediate Vesting

                  2.       0 % 100%

                  3.       ___% ___% 100%

                  4.       0% 20% 40% 60% 80% 100%

                  5.       ___% ___% 20% 40% 60% 80% 100%

                  6.       10% 20% 30% 40% 60% 80% 100%

                  7.       ___% ___%___%___% 100%

                  8.       ___% ___%___%___% ___% ___% 100%

                                                     Section 401(k) Plan AA #010

                                       27


                  THE PERCENTAGES SELECTED FOR SCHEDULE (8) MAY NOT BE LESS FOR
ANY YEAR THAN THE PERCENTAGES SHOWN AT SCHEDULE (5).



Vesting Schedule Chart         Employer Contribution Type
- ----------------------         --------------------------
                            
_________2___________          All Employer Contributions

_____________________          Safe Harbor Contributions (Matching or Non-Elective)

_________1___________          QMACs and QNECs

_____________________          Non-Safe Harbor Match - Formula 1

_____________________          Non-Safe Harbor Match - Formula 2

_____________________          Match on Voluntary After-tax Contributions

_____________________          Match on Required After-tax Contributions

_____________________          Discretionary Contributions

_________2___________          Top-Heavy Minimum Contribution

_____________________          Other Employer Contribution


         C.       SERVICE DISREGARDED FOR VESTING:

         [X]      1.       Not applicable. All Service is recognized.

         [ ]      2.       Service prior to the Effective Date of this Plan
                           or a predecessor plan is disregarded when computing a
                           Participant's vested and nonforfeitable interest.

         [ ]      3.       Service prior to a Participant having attained age 18
                           is disregarded when computing a Participant's vested
                           and nonforfeitable interest.

[ ]      D.       FULL VESTING OF EMPLOYER CONTRIBUTIONS FOR CURRENT
                  PARTICIPANTS:

                  Notwithstanding the elections above, all Employer
                  contributions made to a Participant's account shall be 100%
                  fully vested if the Participant is employed on the Effective
                  Date of the Plan (or such other date as entered herein):_____.

XIV.     SERVICE WITH PREDECESSOR ORGANIZATION

                  [ ]      A.       Not applicable.  The Plan does not recognize
                                    Service with any predecessor organization.

                  [X]      B.       The Plan recognizes Service with all
                                    predecessor organizations.

                  [ ]      C.       Service with the following organization(s)
                                    will be recognized for the Plan purpose
                                    indicated:



                                                       Allocation
                                          Eligibility   Accrual     Vesting
                                          -----------   -------     -------
                                                           
___________________________                   [ ]         [ ]         [ ]
___________________________                   [ ]         [ ]         [ ]


                  Attach additional pages as necessary.

XV.      IN-SERVICE WITHDRAWALS

         A.       IN-SERVICE WITHDRAWALS:

         [ ]      1.       In-service withdrawals are not permitted in the Plan.

                                                     Section 401(k) Plan AA #010

                                       28


         [X]      2.       In-service withdrawals are permitted in the Plan.
                           Participants may withdraw the following contribution
                           types after meeting the following requirements
                           (select one or more of the following options):



                                               WITHDRAWAL RESTRICTIONS
CONTRIBUTION TYPES             A        B        C        D       E        F        G
- ------------------             -------------------------------------------------------
                                                              
a.  All Contributions         [ ]      n/a      n/a      [ ]     [X]      n/a      n/a

b.  Voluntary After-tax       [ ]      [ ]      [ ]      [ ]     [ ]      [ ]      n/a

c.  Required After-tax        [ ]      [ ]      [ ]      [ ]     [ ]      [ ]      n/a

d.  Rollover                  [ ]      [ ]      [ ]      [ ]     [ ]      [ ]      n/a

e.  Transfer                  [ ]      [ ]      [ ]      [ ]     [ ]      [ ]      [ ]

f.  Elective Deferrals        [ ]      n/a      n/a      [ ]     [ ]      n/a      n/a

g.  Qualified Non-Elective    [ ]      n/a      n/a      [ ]     [ ]      n/a      n/a

h.  Qualified Matching        [ ]      n/a      n/a      [ ]     [ ]      n/a      n/a

i.  Safe Harbor Matching      [ ]      n/a      n/a      [ ]     [ ]      n/a      n/a

j.  Safe Harbor Non-
    Elective                  [ ]      n/a      n/a      [ ]     [ ]      n/a      n/a

k.  Vested Non-Safe Harbor
    Matching Formula 1        [ ]      [ ]      [ ]      [ ]     [ ]       [ ]     [ ]

l.  Vested Non-Safe Harbor
    Matching Formula 2        [ ]      [ ]      [ ]      [ ]     [ ]       [ ]     [ ]

m.  Vested Discretionary      [ ]      [ ]      [ ]      [ ]     [ ]       [ ]     [ ]


                           WITHDRAWAL RESTRICTION KEY

                           A.       Not available for in-service withdrawals.

                           B.       Available for in-service withdrawals.

                           C.       Participants having completed five years of
                                    Plan participation may elect to withdraw all
                                    or any part of their Vested Account Balance.

                           D.       Participants may withdraw all or any part of
                                    their Account Balance after having attained
                                    the Plan's Normal Retirement Age.

                           E.       Participants may withdraw all or any part of
                                    their Vested Account Balance after having
                                    attained age 59.5 (not less than age
                                    59 1/2).

                           F.       Participants may elect to withdraw all or
                                    any part of their Vested Account Balance
                                    which has been credited to their account for
                                    a period in excess of two years.

                           G.       Available for withdrawal only if the
                                    Participant is 100% vested.

         B.       HARDSHIP WITHDRAWALS:

         [ ]      1.       Hardship withdrawals are not permitted in the Plan.

         [X]      2.       Hardship withdrawals are permitted in the Plan and
                           will be taken from the Participant's account as
                           follows (select one or more of these options):

                                                     Section 401(k) Plan AA #010

                                       29


                  [X]      a.       Participants may withdraw Elective
                                    Deferrals.

                  [ ]      b.       Participants may withdraw Elective Deferrals
                                    and any earnings credited as of December 31,
                                    1988 (or if later, the end of the last Plan
                                    Year ending before July 1, 1989).

                  [X]      c.       Participants may withdraw Rollover
                                    Contributions plus their earnings.

                  [X]      d.       Participants may withdraw Transfer
                                    Contributions plus their earnings.

                  [ ]      e.       Participants may withdraw fully vested
                                    Employer contributions plus their earnings.

                  [X]      f.       Participants may withdraw vested Non-Safe
                                    Harbor Matching Formula 1 Contributions plus
                                    their earnings.

                  [ ]      g.       Participants may withdraw vested Non-Safe
                                    Harbor Matching Formula 2 Contributions plus
                                    their earnings.

                  [X]      h.       Participants may withdraw Qualified
                                    Matching Contributions and Qualified
                                    Non-Elective Contributions plus their
                                    earnings, and the earnings on Elective
                                    Deferrals which have been credited to the
                                    Participant's account as of December 31,
                                    1988 (or if later, the end of the last Plan
                                    Year ending before July 1, 1989).

XVI.     LOAN PROVISIONS

[X]      A.       Participant loans are permitted in accordance with the
                  Employer's established loan procedures.

[X]      B.       Loan payments will be suspended under the Plan as permitted
                  under Code Section 414(u) in compliance with the Uniformed
                  Services Employment and Reemployment Rights Act of 1994.

XVII.    INVESTMENT MANAGEMENT

         A.       INVESTMENT MANAGEMENT RESPONSIBILITY:

         [ ]      1.       The Employer shall appoint a discretionary Trustee to
                           manage the assets of the Plan.

         [ ]      2.       The Employer shall retain investment management
                           responsibility and/or authority.

         [X]      3.       The party designated below shall be responsible for
                           the investment of the Participant's account.

                           By selecting a box, the Employer is making a
                           designation as to whom will have authority to issue
                           investment directives with respect to the specified
                           contribution type (check all applicable boxes):



                                            Trustee        Employer      Participant
                                            -------        --------      -----------
                                                                
a. All Contributions                          n/a            n/a             [X]

b. Employer Contributions                     [ ]            [ ]             [ ]

c. Elective Deferrals                         [ ]            [ ]             [ ]

d. Voluntary After-tax                        [ ]            [ ]             [ ]

e. Required After-tax                         [ ]            [ ]             [ ]


                                                     Section 401(k) Plan AA #010

                                       30


                                                                    
f. Safe Harbor Contributions                  [ ]            [ ]             [ ]

g. Non-Safe Harbor Match Formula 1            [ ]            [ ]             [ ]

h. QMACs                                      [ ]            [ ]             [ ]

i. QNECs                                      [ ]            [ ]             [ ]

j. Non-Safe Harbor Match Formula 2            [ ]            [ ]             [ ]

k. Rollover Contributions                     [ ]            [ ]             [ ]

l. Transfer Contributions                     [ ]            [ ]             [ ]



                  TO THE EXTENT THAT PARTICIPANT SELF-DIRECTION WAS PREVIOUSLY
                  PERMITTED, THE EMPLOYER SHALL HAVE THE RIGHT TO EITHER MAKE
                  THE ASSETS PART OF THE GENERAL FUND, OR LEAVE THEM AS
                  SELF-DIRECTED SUBJECT TO THE PROVISIONS OF THE BASIC PLAN
                  DOCUMENT #01.

         B.       LIMITATIONS ON PARTICIPANT DIRECTED INVESTMENTS:

         [X]      1.       Participants are permitted to invest among only
                           those investment alternatives made available by the
                           Employer under the Plan.

         [ ]      2.       Participants are permitted to invest in any
                           investment alternative permitted under the Basic Plan
                           Document #01.

[ ]      C.       INSURANCE:

                  The Plan permits insurance as an investment alternative.

[X]      D.       ERISA SECTION 404(c):

                  The Employer intends to be covered by the fiduciary liability
                  provisions with respect to Participant directed investments
                  under ERISA Section 404(c).

XVIII.   DISTRIBUTION OPTIONS

         A.       TIMING OF DISTRIBUTIONS [BOTH (1) AND (2) MUST BE COMPLETED]:

                  1.       Distributions payable as a result of termination for
                           reasons other than death, Disability or retirement
                           shall be paid A [select from the list at (A)(3)
                           below].

                  2.       Distributions payable as a result of termination for
                           death, Disability or retirement shall be paid A
                           [select from the list at (A)(3) below].

                  3.       Distribution Options:

                           a.       As soon as administratively feasible on or
                                    after the Valuation Date following the date
                                    on which a distribution is requested or is
                                    otherwise payable.

                           b.       As soon as administratively feasible
                                    following the close of the Plan Year during
                                    which a distribution is requested or is
                                    otherwise payable.

                           c.       As soon as administratively feasible
                                    following the date on which a distribution
                                    is requested or is otherwise payable. (This
                                    option is recommended for daily valuation
                                    plans.)

                           d.       As soon as administratively feasible after
                                    the close of the Plan Year during which the
                                    Participant incurs ___________ (cannot be
                                    more than 5) consecutive one-year Breaks in
                                    Service. [This formula can only be used in
                                    (A)(1).]

                                                     Section 401(k) Plan AA #010

                                       31


                           e.       As soon as administratively feasible after
                                    the close of the Plan Year during which the
                                    Participant incurs ___________ (cannot be
                                    more than 5) consecutive one-year Breaks in
                                    Service. [This formula can only be used in
                                    (A)(2).]

                           f.       Only after the Participant has attained the
                                    Plan's Normal Retirement Age or Early
                                    Retirement Age, if applicable.

         B.       REQUIRED BEGINNING DATE:

                  The Required Beginning Date of a Participant with respect to a
                  Plan is (select one from below):

         [ ]      1.       The April 1 of the calendar year following the
                           calendar year in which the Participant attains age
                           70 1/2.

         [ ]      2.       The April 1 of the calendar year following the
                           calendar year in which the Participant attains age
                           70 1/2 except that distributions to a Participant
                           (other than a 5% owner) with respect to benefits
                           accrued after the later of the adoption of this Plan
                           or Effective Date of the amendment of this Plan must
                           commence no later than the April 1 of the calendar
                           year following the later of the calendar year in
                           which the Participant attains age 70 1/2 or the
                           calendar year in which the Participant retires.

         [X]      3.       The later of the April 1 of the calendar year
                           following the calendar year in which the Participant
                           attains age 70 1/2 or retires except that
                           distributions to a 5% owner must commence by the
                           April 1 of the calendar year following the calendar
                           year in which the Participant attains age 70 1/2.

                           Except that such Participant [X] may [ ] may not
                           elect to begin receiving distributions as of April 1
                           of the calendar year following the calendar year in
                           which the Participant attains age 70 1/2. Any
                           distributions made pursuant to such an election will
                           not be considered required minimum distributions.
                           Such distributions will be considered in-service
                           distributions and as such, will be subject to
                           applicable withholding.

                  PLANS WHICH ARE AN AMENDMENT OR RESTATEMENT OF AN EXISTING
                  PLAN WHICH PROVIDED FOR THE PROVISIONS OF CODE SECTION
                  401(a)(9) CURRENTLY IN EFFECT PRIOR TO THE AMENDMENT OF THE
                  SMALL BUSINESS JOB PROTECTION ACT OF 1996 MUST COMPLETE
                  SCHEDULE C.

         C.       FORMS OF PAYMENT (SELECT ALL THAT APPLY):

         [X]      1.       Lump sum.

         [X]      2.       Installment payments.

         [ ]      3.       Partial payments; the minimum amount will be
                           $___________.

         [ ]      4.       Life annuity.

         [ ]      5.       Term certain annuity with payments guaranteed for
                           ___________ years (not to exceed 20).

         [ ]      6        Joint and [ ] 50%, [ ] 6-2/3%, [ ] 75% or [ ] 100%
                           survivor annuity.

         [ ]      7.       The default form of payment will be a direct rollover
                           into an individual retirement account or annuity for
                           any "cash out" distribution made pursuant to Code
                           Sections 411(a)(7), 411(a)(11) and 417(e)(1).

         [X]      8.       Cash.

         [ ]      9.       Employer securities.

         [ ]      10.      Other marketable securities.

                  THE NORMAL FORM OF PAYMENT IS DETERMINED AT SECTION III(J) OF
                  THIS ADOPTION AGREEMENT.

                                                     Section 401(k) Plan AA #010
                                       32


         D.       RECALCULATION OF LIFE EXPECTANCY:

         [ ]      1.       Recalculation is not permitted.

         [X]      2.       Recalculation is permitted. When determining
                           installment payments in satisfying the minimum
                           distribution requirements under the Plan, and life
                           expectancy is being recalculated:

                  [ ]      a.       only the Participant's life expectancy shall
                                    be recalculated.

                  [X]      b.       both the Participant's and Spouse's life
                                    expectancy shall be recalculated.

                  [ ]      c.       the Participant will determine whose life
                                    expectancy is recalculated.

XIX.     SPONSOR INFORMATION AND ACCEPTANCE

         This Plan may not be used and shall not be deemed to be a Prototype
         Plan unless an authorized representative of the Sponsor has
         acknowledged the use of the Plan. Such acknowledgment that the Employer
         is using the Plan does not represent that the Adoption Agreement (as
         completed) and Basic Plan Document have been reviewed by a
         representative of the Sponsor or constitute a qualified retirement
         plan.

         Acknowledged and accepted by the Sponsor this 4th day of December,
         2002.

         Name:             U.S. Bank, N.A.

         Title:            Account Manager

         Signature:        /s/ Sherry Glanville

         Questions concerning the language contained in and qualification of the
         Prototype should be addressed to: U.S. Bank, N.A.

         (Position): ACCOUNT MANAGER        (Phone Number): 503-275-4637

         In the event that the Sponsor amends, discontinues or abandons this
         Prototype Plan, notification will be provided to the Employer's address
         provided on the first page of this Adoption Agreement.

                                                     Section 401(k) Plan AA #010
                                       33


XX.      SIGNATURES

         THE SPONSOR RECOMMENDS THAT THE EMPLOYER CONSULT WITH ITS LEGAL COUNSEL
         AND/OR TAX ADVISOR BEFORE EXECUTING THIS ADOPTION AGREEMENT. THE
         EMPLOYER UNDERSTANDS THAT ITS FAILURE TO PROPERLY COMPLETE OR AMEND
         THIS ADOPTION AGREEMENT MAY RESULT IN FAILURE OF THE PLAN TO QUALIFY OR
         DISQUALIFICATION OF THE PLAN. THE EMPLOYER BY EXECUTING THIS ADOPTION
         AGREEMENT ACKNOWLEDGES THAT THIS IS A LEGAL DOCUMENT WITH SIGNIFICANT
         TAX AND LEGAL RAMIFICATIONS.

         A.       EMPLOYER:

                  This Adoption Agreement and the corresponding provisions of
                  Basic Plan Document #01 are adopted by the Employer this 6th
                  day of December, 2002.

                  Name of Employer:                          JDA Software, Inc.

                  Executed on behalf of the Employer by:     Margie Jones

                  Title:                                     Benefits Manager

                  Signature:                                 /s/ Margie Jones

                  PARTICIPATING EMPLOYER:

                  Name and address of any Participating Employer.

                  LIOCS CORPORATION
                  801 WARRENVILLE RD, STE 500
                  LISLE, IL 60532

                  This Adoption Agreement and the corresponding provisions of
                  Basic Plan Document #01 are adopted by the Participating
                  Employer this__________ day of _____________________,
                  ___________.

                  Executed on behalf of the
                  Participating Employer by:         ___________________________

                  Title:                             ___________________________

                  Signature:                         ___________________________

                  Attach additional signature pages as necessary.

                  EMPLOYER'S RELIANCE: The adopting Employer may rely on an
                  Opinion Letter issued by the Internal Revenue Service as
                  evidence that the Plan is qualified under Section 401 of the
                  Internal Revenue Code only to the extent provided in
                  Announcement 2001-77, 2001-30 I.R.B. The Employer may not rely
                  on the Opinion Letter in certain other circumstances or with
                  respect to certain qualification requirements, which are
                  specified in the Opinion Letter issued with respect to the
                  Plan and in Announcement 2001-77. In order to obtain reliance
                  in such circumstances or with respect to such qualification
                  requirements, application for a determination letter must be
                  made to Employee Plans Determinations of the Internal Revenue
                  Service.

                  This Adoption Agreement may only be used in conjunction with
                  Basic Plan Document #01.

                                                     Section 401(k) Plan AA #010

                                       34


         B.       TRUSTEE:

                  Trust Agreement:

                  [ ]      Not applicable. Plan assets will be invested in
                           Group Annuity Contracts. There is no Trustee and the
                           terms of the contract(s) will apply.

                  [X]      The Trust provisions used will be as contained in the
                           Basic Plan Document #01.

                  [ ]      The Trust provisions used will be as contained in
                           the accompanying executed Trust Agreement between the
                           Employer and the Trustee attached hereto.

                  Complete the remainder of this section only if the Trust
                  provisions used are as contained in the Basic Plan Document
                  #01.

                  Name and address of Trustee:

                  U. S. BANK, N. A.
                  425 WALNUT ST
                  CINCINNATI, OH 45201

                  The assets of the Plan shall be invested in accordance with
                  Article XIII of the Basic Plan Document #01. The Employer's
                  Plan and Trust as contained herein is accepted by the Trustee
                  this 4th day of December, 2002.

                  Accepted on behalf of the Trustee by:   Sherry Glanville

                  Title:                                  Vice President

                  Signature:                              /s/ Sherry Glanville

                  Accepted on behalf of the Trustee by:  _______________________

                  Title:                                 _______________________

                  Signature:                             _______________________

                  Accepted on behalf of the Trustee by:  _______________________

                  Title:                                 _______________________

                  Signature:                             _______________________

                                                     Section 401(k) Plan AA #010

                                       35


         C.       CUSTODIAN:

                  Custodial Agreement:

                  [X]      Not applicable. There is no Custodian.

                  [ ]      Not applicable. Plan assets will be invested in
                           Group Annuity Contracts. There is no Custodian and
                           the terms of the contract(s) will apply.

                  [ ]      The Custodial provisions used will be as contained in
                           Basic Plan Document #01.

                  [ ]      The Custodial provisions used will be as contained in
                           the accompanying executed Custodial Agreement between
                           the Employer and the Custodian attached hereto.

                  Complete the remainder of this section only if the Custodial
                  provisions used are as contained in the Basic Plan Document
                  #01.

                  Name and address of Custodian:

                  ______________________________________________________________
                  ______________________________________________________________
                  ______________________________________________________________
                  ______________________________________________________________

                  The assets of the Plan shall be invested in accordance with
                  Article XIII of the Basic Plan Document #01. The Employer's
                  Plan and Custodial Account as contained herein are accepted by
                  the Custodian this __________ day of ____________________,
                  _____________.

                  Accepted on behalf of the Custodian by: ______________________

                  Title:                                  ______________________

                  Signature:                              ______________________

                                                     Section 401(k) Plan AA #010

                                       36


                                   SCHEDULE A

                               PROTECTED BENEFITS

This Schedule includes any prior Plan protected benefits which are not available
in Basic Plan Document #01. Complete as applicable.

1.       PLAN PROVISION:

         PARTICIPANTS IN THE LIOCS CORPORATION PROFIT SHARING PLAN PRIOR TO
         DECEMBER 31, 1997 HAVE A NORMAL RETIREMENT AGE OF THE EARLIER OF AGE 55
         AND 5 YEARS OF PLAN PARTICIPATION OR AGE 59.5

         EFFECTIVE DATE:______________________________________

2.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

3.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

4.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

5.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

                                                     Section 401(k) Plan AA #010

                                       37


                                   SCHEDULE B

                              PRIOR PLAN PROVISIONS

This Schedule should be used if a prior plan contains provisions not found in
Basic Plan Document #01, or where the Employer wishes to document transactions
or historical provisions of the Employer's Plan.

1.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

2.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

3.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

4.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

5.       PLAN PROVISION:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE:______________________________________

                                                     Section 401(k) Plan AA #010

                                       38


                                   SCHEDULE C

                       PREAMENDMENT OPERATION OF THE PLAN

The following are the adopting Employer's elective Plan provisions which conform
the terms of this Prototype Plan to the preamendment operation of the Plan
during the transition period between the earliest effective date under GUST (as
defined below) and the effective date of adoption of this Prototype Plan and
Trust which takes into account all of the changes in the qualification
requirements made by the following: The Uruguay Round Agreements, Pub. L.
103-465 (GATT); The Uniformed Services Employment and Reemployment Rights Act of
1994, Pub. L. 103-353 (USERRA); The Small Business Job Protection Act of 1996,
Pub. L. 104-188 (SBJPA) [including Section 414(u) of the Internal Revenue Code];
The Taxpayer Relief Act of 1997, Pub. L. 105-34 (TRA'97); and The Internal
Revenue Service Restructuring and Reform Act of 1998, Pub. L. 105-206 (IRSRRA);
and The Community Renewal Tax Relief Act of 2000, Pub. L. 106-554 (CRA),
hereinafter referred to collectively as GUST.

Complete as applicable and appropriate.

I.       PLAN PROVISION:   HIGHLY COMPENSATED EMPLOYEES

         For Plan Years beginning after 1996, the Employer may elect a "Top-Paid
         Group" election and the Calendar Year Data election to determine the
         definition of Highly Compensated Employee:

         [X]      A.       Top-Paid Group Election: A Participant (who is not
                           a 5% owner at any time during the determination year
                           or the look-back year) who earned more than $80,000
                           as indexed for the look-back year is a Highly
                           Compensated Employee if the Employee was in the
                           Top-Paid Group for the look-back year. The election
                           was applicable for:

                           [X]      1.      1997 Plan Year.
                           [X]      2.      1998 Plan Year.
                           [X]      3.      1999 Plan Year.
                           [X]      4.      2000 Plan Year.
                           [X]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

         [ ]      B.       Calendar Year Data Election:  In determining who is a
                           Highly Compensated Employee (other than a 5% owner)
                           the Employer makes a calendar year data election. The
                           look-back year is the calendar year beginning with or
                           within the look-back year. The election was
                           applicable for:

                           [ ]      1.      1998 Plan Year.
                           [ ]      2.      1999 Plan Year.
                           [ ]      3.      2000 Plan Year.
                           [ ]      4.      2001 Plan Year.
                           [ ]      5.      2002 Plan Year.

                  If the elections above are made, such election shall apply to
                  all Plans maintained by the Employer.

         [ ]      C.       Calendar Year Calculation Election (for 1997 Plan
                           Year only): Indicate below whether the Calendar Year
                           calculation election was made for Plan Years
                           beginning in 1997:

                           [ ]      Yes              [ ]      No

II.      PLAN PROVISION:   FAMILY AGGREGATION

         Did the Pre-SBJPA Family Aggregation rules of Code Sections
         401(a)(17)(a) and 414(q)(6), both in effect for Plan Years beginning
         before January 1, 1997, continue to apply for any purpose for Plan
         Years beginning after 1996?

         [X]      No

                                                     Section 401(k) Plan AA #010
                                       39


         [ ]      Yes; explain the application:_________________________________
                  ______________________________________________________________
                  ______________________________________________________________

                  If this rule was subsequently discontinued, indicate when rule
                  no longer applied:

                  ______________________________________________________________
                  ______________________________________________________________

         EMPLOYERS WHO ADOPT THIS PROTOTYPE PLAN MAY NOT ELECT TO CONTINUE TO
         APPLY THE PRE-SBJA FAMILY AGGREGATION RULES.

III.     PLAN PROVISION: COMBINED PLAN LIMIT OF CODE SECTION 415(e)

         Did the Employer maintain a Defined Benefit Plan prior to January 1,
         2000?

         [ ]      Yes               [X]     No

         Did the Plan continue to apply the combined Plan limit of Code Section
         415(e) (as in effect for Limitation Years beginning before January 1,
         2000) in limitation years beginning after December 31, 1999, to the
         extent that such election conforms to the Plan's operation?

         [ ]      Yes               [ ]     No

         If yes, specify provisions below that will satisfy the 1.0 limitation
         of Code Section 415(e). Such language must preclude Employer
         discretion. The Employer must also specify the interest and mortality
         assumptions used in determining Present Value in the Defined Benefit
         Plan.

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EMPLOYERS WHO ADOPT THIS PROTOTYPE PLAN MAY NOT ELECT TO CONTINUE TO
         APPLY THE COMBINED PLAN LIMIT OF CODE SECTION 415(e) IN YEARS BEGINNING
         AFTER THE DATE THE EMPLOYER ADOPTS ITS GUST-RELATED PLAN.

IV.      PLAN PROVISION:  NONDISCRIMINATION TESTING

         The Small Business Job Protection Act permits the Employer to use the
         ADP and/or ACP of Non-Highly Compensated Employees for the prior year
         or current year in determining whether the plan satisfied the
         nondiscrimination tests.

         Employers who adopt this Prototype Plan must use the same testing
         method for both the ADP and ACP tests for Plan Years beginning on or
         after the date the Employer adopts this GUST-restated Plan. This
         restriction does not apply with respect to Plan Years beginning before
         the date the Employer adopts this GUST-restated plan.

1.       ADP TESTING ELECTION:

         [ ]      a.       Current year data for all Participants was used.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [ ]      3.      1999 Plan Year.
                           [ ]      4.      2000 Plan Year.
                           [ ]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

         [X]      b.       Prior year data for Participants who are Non-Highly
                           Compensated Employees was used.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.

                                                     Section 401(k) Plan AA #010

                                       40


                           [X]      3.      1999 Plan Year.
                           [X]      4.      2000 Plan Year.
                           [X]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

         2.       ACP TESTING ELECTION:

         [ ]      a.       Current year data for all Participants was used.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [ ]      3.      1999 Plan Year.
                           [ ]      4.      2000 Plan Year.
                           [ ]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

         [X]      b.       Prior year data for Participants who are Non-Highly
                           Compensated Employees was used.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [X]      3.      1999 Plan Year.
                           [X]      4.      2000 Plan Year.
                           [X]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

V.       PLAN PROVISION:   FIRST PLAN YEAR TESTING ELECTIONS

         For a new 401(k) Plan, the Employer could use either the current or
         prior year testing methods as well as a rule that deems the prior year
         ADP/ACP to be 3%.

         1.       ADP TESTING ELECTION:

         [ ]      a.       Current year data for all Participants was used.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [ ]      3.      1999 Plan Year.
                           [ ]      4.      2000 Plan Year.
                           [ ]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

         [ ]      b.       Current year data for Participants who are Highly
                           Compensated Employees will be used. The ADP for
                           Participants who are Non-Highly Compensated Employees
                           was assumed to be 3% or the actual ADP if greater.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [ ]      3.      1999 Plan Year.
                           [ ]      4.      2000 Plan Year.
                           [ ]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

         2.       ACP TESTING ELECTION:

         [ ]      a.       Current year data for all Participants was used.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [ ]      3.      1999 Plan Year.
                           [ ]      4.      2000 Plan Year.
                           [ ]      5.      2001 Plan Year.

                                                     Section 401(k) Plan AA #010

                                       41


                           [ ]      6.      2002 Plan Year.

         [ ]      b.       Current year data for Participants who are Highly
                           Compensated Employees will be used. The ACP for
                           Participants who are Non-Highly Compensated Employees
                           was assumed to be 3% or the actual ACP if greater.

                           [ ]      1.      1997 Plan Year.
                           [ ]      2.      1998 Plan Year.
                           [ ]      3.      1999 Plan Year.
                           [ ]      4.      2000 Plan Year.
                           [ ]      5.      2001 Plan Year.
                           [ ]      6.      2002 Plan Year.

VI.      PLAN PROVISION: DISTRIBUTION ALTERNATIVES FOR PARTICIPANTS WHO ARE NOT
         A MORE THAN 5% OWNER

         Select (A), (B), (C) and/or (D), whichever is applicable. Subsection
         (D) must be selected to the extent that there would otherwise be an
         elimination of a pre-retirement age 70 1/2 distribution option for
         Employees other than those listed above.

         [ ]      A.       Any Participant who has not had a separation
                           from Service who had attained age 70 1/2 in years
                           after 1995 may elect by April 1 of the calendar year
                           following the calendar year in which the Participant
                           attained age 70 1/2 (or by December 31, 1997, in the
                           case of a Participant attaining age 70 1/2 in 1996)
                           to defer distributions until the calendar year in
                           which the Participant retires. If no such election is
                           made, the Participant will begin receiving
                           distributions by the April 1 of the calendar year
                           following the calendar year in which the Participant
                           attained age 70 1/2 (or by December 31, 1997, in the
                           case of a Participant attaining age 70 1/2 in 1996).

         [ ]      B.       Any Participant who has not had a separation
                           from Service and is currently in benefit payment
                           status because of attainment of age 70 1/2 in years
                           prior to 1997 may elect to stop distributions and
                           recommence by the April 1 of the calendar year
                           following the calendar year in which the Participant
                           retires. There is either (select one):

                           [ ]      1.      a new Annuity Starting Date upon
                                            recommencement, or

                           [ ]      2.      no new Annuity Starting Date upon
                                            recommencement.

         [ ]      C.       Any Participant who has not had a separation
                           from Service, and is currently in benefit payment
                           status because of attainment of age 70 1/2 in 1997 or
                           in a later year (or attained age 70 1/2 in 1996, but
                           had not commenced required minimum distributions in
                           1996) may elect to stop distributions and recommence
                           by the April 1 of the calendar year following the
                           calendar year in which the Participant retires. There
                           is either (select one):

                           [ ]      1.      a new Annuity Starting Date upon
                                            recommencement, or

                           [ ]      2.      no new Annuity Starting Date upon
                                            recommencement.

         [ ]      D.       The pre-retirement distribution option is only
                           eliminated with respect to Employees who reach age
                           70 1/2 in or after a calendar year that begins after
                           the later of December 31, 1998, or the adoption of
                           the amendment to the Plan. The pre-retirement age
                           70 1/2 distribution option is an optional form of
                           benefit under which benefits are payable in a
                           particular distribution form (including any
                           modifications that may be elected after benefit
                           commencement) and commencing at a time during the
                           period that begins on or after January 1 of the
                           calendar year following the calendar year in which an
                           Employee attains age 70 1/2 and ends April 1 of the
                           immediately following calendar year.

VII.     PLAN PROVISION:   MANDATORY CASH-OUT RULE

         [X]      For Plan Years beginning after August 5, 1997, the $3,500
                  cash-out limit is increased to $5,000.

                                                     Section 401(k) Plan AA #010

                                       42


VIII.    PLAN PROVISION:   30-DAY WAIVER PERIOD

         For Plan Years beginning after December 31, 1996, if the Plan is
         subject to the Joint and Survivor rules did the Plan provide
         distributions prior to the expiration of the 30-day waiting period?

         [ ]      Yes               [ ]     No

IX.      PLAN PROVISION:   SUSPENSION OF LOAN REPAYMENTS

         On or after December 12, 1994, did the Employer permit the suspension
         of loan repayments due to qualified military leave?

         [X] Yes  [ ] No

         Effective Date: 12/12/1994

X.       PLAN PROVISION: HARDSHIP DISTRIBUTIONS TREATED AS ELIGIBLE ROLLOVER
         DISTRIBUTIONS

         The Employer had the option with respect to Hardship distributions made
         after December 31, 1998 to treat as eligible rollover distributions, or
         to delay the Effective Date until January 1, 2000. Hardship
         distributions were not treated as eligible rollover distributions
         effective as of:

         [ ]      January 1, 1999
         [X]      January 1, 2000
         [ ]      Other (specify date):  ______________________________________

XI.      PLAN PROVISION:   401(k) SAFE HARBOR PROVISIONS

         For Plan Years beginning after 1998, the Employer may implement safe
         harbor provisions under Code Sections 401(m)(11) and 401(k)(12). Did
         the Plan elect safe harbor status?

                  [ ]      Yes

                  [X]      No

         If yes, enter the formulas below:



DATE PLAN YEAR BEGINS              SECTION 401(k)       SECTION 401(m)
- ----------------------------------------------------------------------
                                                  
  ______/_______/99

  ______/_______/00

  ______/_______/01

  ______/_______/02


XII.     OTHER PLAN PROVISIONS:

         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________
         _______________________________________________________________________

         EFFECTIVE DATE: _______________________________________________________

                                                     Section 401(k) Plan AA #010

                                       43


                                   SCHEDULE D

          SAFE HARBOR ELECTIONS FOR FLEXIBLE NON-ELECTIVE CONTRIBUTION

The following elections are made with regard to the Plan's Safe Harbor status
pursuant to Section VII herein. For Plan Years indicated below, the Plan hereby
invokes a Safe Harbor status in accordance with IRS Notices 98-52 and 2000-3.

For all Plan Years in which this Safe Harbor election is being made, the
limitations and restrictions found in Section VII herein apply.

1.   For the Plan Year beginning _____ and ending _____, the Employer hereby
     invokes a Safe Harbor status as provided in IRS Notice 2000-3. The Safe
     Harbor Contribution will be an amount equal to _____% (not less than 3%) of
     Compensation. This election is made on this _____ day of _____, _____ (date
     may not be later than 30 days prior to the end of the Plan Year in which
     such election is being made).

2.   For the Plan Year beginning _____ and ending _____, the Employer hereby
     invokes a Safe Harbor status as provided in IRS Notice 2000-3. The Safe
     Harbor Contribution will be an amount equal to _____% (not less than 3%) of
     Compensation. This election is made on this _____ day of _____, _____ (date
     may not be later than 30 days prior to the end of the Plan Year in which
     such election is being made).

3.   For the Plan Year beginning _____ and ending _____, the Employer hereby
     invokes a Safe Harbor status as provided in IRS Notice 2000-3. The Safe
     Harbor Contribution will be an amount equal to _____% (not less than 3%) of
     Compensation. This election is made on this _____ day of _____, _____ (date
     may not be later than 30 days prior to the end of the Plan Year in which
     such election is being made).

4.   For the Plan Year beginning _____ and ending _____, the Employer hereby
     invokes a Safe Harbor status as provided in IRS Notice 2000-3. The Safe
     Harbor Contribution will be an amount equal to _____% (not less than 3%) of
     Compensation. This election is made on this _____ day of _____, _____ (date
     may not be later than 30 days prior to the end of the Plan Year in which
     such election is being made).

5.   For the Plan Year beginning _____ and ending _____, the Employer hereby
     invokes a Safe Harbor status as provided in IRS Notice 2000-3. The Safe
     Harbor Contribution will be an amount equal to _____% (not less than 3%) of
     Compensation. This election is made on this _____ day of _____, _____ (date
     may not be later than 30 days prior to the end of the Plan Year in which
     such election is being made).

                                                     Section 401(k) Plan AA #010

                                       44


                                   SCHEDULE E

                         COLLECTIVE AND COMMINGLED FUNDS

The Trustee is authorized to invest all or any part of the Fund in the following
Collective and Commingled Funds as provided for in the Basic Plan Document #01:

1.   All funds under the following declarations of trust, as amended:

2.   U.S. Bank, N.A. Collective Investment Funds for EB Retirement Trusts

3.   Firstar Investment Trust for EB Plans

4.   Collective Investment Funds of Firstar Bank Wisconsin

                                                     Section 401(k) Plan AA #010

                                       45


                                    AMENDMENT
                                     TO THE
                                 NONSTANDARDIZED
                      CASH OR DEFERRED PROFIT-SHARING PLAN
                             ADOPTION AGREEMENT #010

1.       Except as otherwise noted, effective as of the first day of the first
         Plan Year beginning after December 31, 2001, Section VI of the
         Nonstandardized Cash or Deferred Profit-Sharing Plan Adoption Agreement
         #010 entitled "EMPLOYEE CONTRIBUTIONS" is amended by adding the
         following new sections:

         "J".     CATCH-UP CONTRIBUTIONS (SELECT ONE):

                  [X] 1.   Shall apply to contributions after 12/31/2001.
                           (enter December 31, 2001 or a later date).

                  [ ] 2.   Shall not apply.

         K.       DIRECT ROLLOVERS:

                  The Plan will accept a Direct Rollover of an Eligible Rollover
                  Distribution from (check each that apply):

         [ ]      1.       A Qualified Plan described in Code Section 401(a) or
                           403(a), excluding Voluntary After-tax Contributions.

         [X]      2.       A Qualified Plan described in Code Section 401(a) or
                           403(a), including Voluntary After-tax Contributions.

         [ ]      3.       An annuity contract described in Code Section 403(b),
                           excluding Voluntary After-tax Contributions.

         [ ]      4.       An eligible plan under Code Section 457(b) which is
                           maintained by a state, political subdivision of a
                           state, or an agency or instrumentality of a state or
                           political subdivision of a state.

         L.       PARTICIPANT ROLLOVER CONTRIBUTIONS FROM OTHER PLANS:

                  The Plan will accept a Participant Rollover Contribution of an
                  Eligible Rollover Distribution from (check only those that
                  apply):

         [X]      1.       A Qualified Plan described in Code Section 401(a) or
                           403(a).

         [ ]      2.       An annuity contract described in Code Section 403(b).

         [ ]      3.       An eligible plan under Code Section 457(b) which is
                           maintained by a state, political subdivision of a
                           state, or any agency or instrumentality of a state or
                           political subdivision of a state.

         M.       PARTICIPANT ROLLOVER CONTRIBUTIONS FROM IRAS:

                  The Plan (select one):

                  [ ]      1.       will

                                                     Section 401(k) Plan AA #010

                                        1


                  [X]      2.       will not

                  accept a Participant Rollover Contribution of the portion of a
                  distribution from an Individual Retirement Account [which was
                  not used as a conduit] or Annuity described in Code Section
                  408(a) or 408(b) that is eligible to be rolled over and would
                  otherwise be includable in gross income.

         N.       EFFECTIVE DATE OF DIRECT ROLLOVER AND PARTICIPANT ROLLOVER
                  CONTRIBUTION PROVISIONS:

         The provisions of (K), (L) and (M) above as they apply to Paragraph 4.4
         of the Basic Plan Document #01 entitled "Rollover Contributions" shall
         be effective _____________________________ (enter a date no earlier
         than January 1, 2002)."

2.       Section VIII(A) of the Nonstandardized Cash or Deferred Profit-Sharing
         Plan Adoption Agreement #010 entitled, "Matching Employer
         Contributions" will be amended effective ___________________________ by
         the addition of a new paragraph 6, which shall read as follows:

         "6.      CATCH-UP CONTRIBUTIONS:

                  [ ]      a.       Catch-Up contributions made by the
                                    Participants will not be matched by the
                                    Employer.

                  [X]      b.       Catch-Up Contributions made by the
                                    Participants will be matched on the same
                                    formula, terms and conditions as provided in
                                    Section VIII of the Adoption Agreement. A
                                    Matching Contribution will be made on the
                                    basis of the contribution type(s) selected
                                    below:

                           [X]      i.       Elective Deferrals
                           [ ]      ii.      403(b) Deferrals"

3.       Section XI of the Nonstandardized Cash or Deferred Profit-Sharing Plan
         Adoption Agreement #010 entitled, "MULTIPLE PLANS MAINTAINED BY THE
         SAME EMPLOYER, LIMITATIONS ON ALLOCATIONS, AND TOP-HEAVY CONTRIBUTIONS"
         will be amended effective _____________ by the addition of a new
         paragraph (C) which shall read as follows:

         "C.      MINIMUM BENEFITS FOR EMPLOYEES ALSO COVERED UNDER ANOTHER
                  PLAN:

                  The Employer should describe below the extent, if any, to
                  which the Top-Heavy Minimum Benefit requirements of Code
                  Section 416(c) and paragraph 14.2 of the Basic Plan Document
                  #01 shall be met in another plan. Please list the name of the
                  other plan, the minimum benefit that will be provided under
                  such other plan, and the Employees who will receive the
                  minimum benefit under such other plan."

                  ______________________________________________________________
                  ______________________________________________________________
                  ______________________________________________________________
                  ______________________________________________________________

4.       Section XIII of the Nonstandardized Cash or Deferred Profit-Sharing
         Plan Adoption Agreement #010 entitled, "VESTING" will be amended
         effective __________________ by the addition of a new paragraph (E)
         which shall read as follows:

         NOTE:    First select to whom the vesting schedule will apply. Number 1
                  should be elected if only active Participants' Matching
                  Contributions accounts will be affected. Letter (a) should be
                  selected if the Employer wishes only to change the vesting
                  schedule for contributions made to the Plan after December 31,
                  2001. Letter (b) should be selected if the Employer

                                                     Section 401(k) Plan AA #010

                                       2


                  wants to change the vesting schedule for all Matching
                  Contributions to the Plan (regardless of when made). Number 2
                  should be selected if the Employer wants to change the vesting
                  schedule on Matching Contributions for all Participants -
                  regardless of whether they are active or inactive. The
                  applicable vesting schedule shall be selected from number 3
                  through 7 below.

         "E.      VESTING OF EMPLOYER MATCHING CONTRIBUTIONS:

                   [ ]     1.       Participants who have completed one Hour of
                                    Service after 2001

                           [ ]      a.      The vesting schedule of
                                            Employer Matching Contributions as
                                            described in paragraph 9.2 of the
                                            Basic Plan Document #01 shall be
                                            selected below and shall apply only
                                            to account balances derived from
                                            Employer Matching Contributions
                                            attributable to a Plan Year
                                            beginning after December 31, 2001.

                           [ ]      b.      The vesting schedule of Employer
                                            Matching Contributions as described
                                            in paragraph 9.2 of the Basic Plan
                                            Document #01 shall be selected below
                                            and shall apply to all Participants
                                            with an account balance derived from
                                            Employer Matching Contributions.

                  [ ]      2.       All Plan Participants:

                           The vesting schedule of Employer Matching
                           Contributions as described in paragraph 9.2 of the
                           Basic Plan Document #01 shall be selected below and
                           shall apply to all Participants with an account
                           balance derived from Employer Matching Contributions.

                  The vesting schedule for Employer Matching Contributions shall
                  be as follows:

                  [ ]      3.       Not applicable.  There are no Matching
                                    Contributions made to the Plan.

                  [X]      4.       Not applicable. The current formula(s) are
                                    equal to or greater than the three year
                                    cliff or six year graded vesting schedules.

                  [ ]      5.       A Participant's account balance derived from
                                    Employer Matching Contributions shall be
                                    fully and immediately vested.

                  [ ]      6.       A Participant's account balance derived from
                                    Employer Matching Contributions shall be
                                    nonforfeitable upon the Participant's
                                    completion of three (3) years of vesting
                                    Service.

                  [ ]      7.       A Participant's account balance derived from
                                    Employer Matching Contributions shall vest
                                    according to the following schedule:



Years of Vesting Service   Vested Percentage
- ------------------------   -----------------
                        
           2                        20%
           3                        40%
           4                        60%
           5                        80%
           6                       100%


                                                     Section 401(k) Plan AA #010

                                        3


5.       Section XV of the Nonstandardized Cash or Deferred Profit-Sharing Plan
         Adoption Agreement #010 entitled, "IN-SERVICE WITHDRAWALS" will be
         amended by the addition of a new paragraph (C) which shall read as
         follows:

         "C.      SUSPENSION PERIOD FOR HARDSHIP DISTRIBUTION (SELECT ONE):

         [X]      1.       A Participant who receives a distribution in
                           calendar year 2001 on account of Hardship shall be
                           prohibited from making Elective Deferrals and
                           Voluntary After-tax Contributions under this and all
                           other plans of the Employer for six (6) months after
                           receipt of the distribution or until January 1, 2002,
                           if later.

         [ ]      2.       A Participant who receives a distribution in
                           calendar year 2001 on account of Hardship shall be
                           prohibited from making Elective Deferrals and
                           Voluntary After-tax Contributions under this and all
                           other plans of the Employer for the period specified
                           in the provisions of the Plan relating to suspension
                           of Elective Deferrals that were in effect prior to
                           this Amendment."

6.       Section XVIII of the Nonstandardized Cash or Deferred Profit-Sharing
         Plan Adoption Agreement #010 entitled, "DISTRIBUTION OPTIONS" will be
         amended effective __________________ by the addition of the following:

         "E.      TREATMENT OF ROLLOVERS IN APPLICATION OF INVOLUNTARY CASH-OUT
                  PROVISIONS:

                  The Plan (select one):

                  [X]      Elects to exclude Rollover Contributions in
                           determining the value of the Participant's
                           nonforfeitable account balance for purposes of the
                           Plan's involuntary cash-out rules.

                  [ ]      Does not elect to exclude Rollover Contributions in
                           determining the value of the Participant's
                           nonforfeitable account balance for purposes of the
                           Plan's involuntary cash-out rules.

                  If the Employer has elected to exclude Rollover Contributions,
                  the election shall apply with respect to distributions made
                  after _________________________ (enter a date no earlier than
                  December 31, 2001) with respect to Participants who separated
                  from Service after __________________________ (enter the date;
                  this date may be earlier than December 31, 2001)."

         F.       DISTRIBUTION UPON SEVERANCE FROM EMPLOYMENT:

                  Distribution upon severance from employment as described in
                  paragraph 6.6(d) of the Basic Plan Document #01 shall apply
                  for distributions after ___________________ (enter a date no
                  earlier than December 31, 2001):

                  [X]      regardless of when the severance from employment
                           occurred.

                  [ ]      for severance from employment occurring after
                           _______________ (enter the Effective Date if
                           different than the Effective Date above)."

                                                     Section 401(k) Plan AA #010

                                        4


         Executed this 4th day of December, 2002.

                                    JDA Software, Inc.
                                    -------------------------
                                    Name of Employer

                                    Margie Jones
                                    -------------------------
                                    Signed by

                                    /s/ Margie Jones
                                    -------------------------
                                    Signature

                                                     Section 401(k) Plan AA #010
                                        5

EX-14.1

                                                                    Exhibit 14.1



                       CODE OF BUSINESS CONDUCT AND ETHICS


                         Cover page for website policy:

      OUR CODE EMBODIES POLICIES ENCOURAGING INDIVIDUAL AND PEER INTEGRITY,
ETHICAL BEHAVIOR AND OUR RESPONSIBILITIES TO OUR EMPLOYEES, CUSTOMERS,
SUPPLIERS, STOCKHOLDERS, AND THE PUBLIC, AND INCLUDES:

   -  Prohibiting conflicts of interest (including protecting corporate
      opportunities)

   -  Protecting our confidential and proprietary information and that of our
      customers' and vendors'

   -  Treating our employees, customers, suppliers and competitors fairly

   -  Encouraging full, fair, accurate, timely and understandable disclosure

   -  Protecting and properly using company assets

   -  Complying with laws, rules and regulations (including insider trading
      laws)

   -  Encouraging the reporting of any unlawful or unethical behavior

      THE INFORMATION BELOW ARE THOSE PORTIONS OF OUR CODE OF BUSINESS CONDUCT
AND ETHICS, WHICH ADDRESS THE ISSUES LISTED ABOVE.




                                       1

                      [JDA SOFTWARE GROUP, INC. LETTERHEAD]



A MESSAGE ABOUT THE CODE OF BUSINESS CONDUCT AND ETHICS FROM OUR CEO:

To All Officers, Directors and Employees:

      One of JDA's most valuable assets is its integrity. Protecting this asset
is the job of everyone in the company. To that end, we have established a Code
of Business Conduct and Ethics. This code applies to every officer, director and
employee. This code should also be provided to and followed by the company's
agents and representatives, including consultants. This code is designed to help
you comply with the law and maintain the highest standards of ethical conduct.
It does not cover every issue that may arise, but it sets out basic principles
and a methodology to help guide you in the attainment of this common goal.

      All of JDA's officers, directors and employees must carry out their duties
in accordance with the policies set forth in this code and with applicable laws
and regulations. Except as otherwise set forth in this code, to the extent that
other company polices and procedures conflict with this code, you should follow
this code. Any violation of applicable law or any deviation from the standards
embodied in this code can result in disciplinary action up to and including
termination. Disciplinary action also may apply to an employee's supervisor who
directs or approves the employee's improper actions, or is aware of those
actions but does not act appropriately to correct them. In addition to imposing
its own discipline, the company may also bring suspected violations of law to
the attention of the appropriate law enforcement personnel. If you are in a
situation which you believe may violate or lead to a violation of this code,
follow the procedures described in this code.

      The standard required by this code is one of thoughtful consideration, and
careful application, of legal requirements.

                                      SIGNATURE



                                      PRESIDENT AND CHIEF EXECUTIVE OFFICER




                                       2

                            JDA SOFTWARE GROUP, INC.

                       CODE OF BUSINESS CONDUCT AND ETHICS

1.    INTRODUCTION

      One of our company's most valuable assets is its integrity. Protecting
this asset is the job of everyone in the company. To that end, we have
established this Code of Business Conduct and Ethics to help our directors,
officers and employees both comply with the law and maintain the highest
standards of ethical conduct. This Code does not cover every issue that may
arise, but it sets out basic principles and a methodology to help guide you in
the attainment of this common goal. This Code should also be provided to and
followed by the company's agents and representatives, including consultants.
Under this Code, the term "director" refers to a member of the company's Board
of Directors, rather than an employee whose job title designates that employee
as a director.

      All of the company's officers, directors and employees must carry out
their duties in accordance with the policies set forth in this Code and with
applicable laws and regulations. Violations of applicable law or any deviation
from the standards embodied in this Code will result in disciplinary action that
may include oral or written warning, disciplinary probation, suspension,
reduction in salary, demotion or dismissal from employment. These disciplinary
actions also may apply to an employee's supervisor who directs or approves the
employee's improper actions, or is aware of those actions but does not act
appropriately to correct them. In addition to imposing its own discipline, the
company may also bring suspected violations of law to the attention of the
appropriate law enforcement personnel. If you are in a situation or are aware of
a situation which you believe may violate or lead to a violation of this Code,
follow the procedures described herein.

      The company has designated the company's General Counsel and Chief
Financial Officer to act as the Compliance Team, responsible for overseeing
communication, training, monitoring, and overall compliance with this Code.

      This Code describes at a high level certain prohibited conduct focusing
primarily on compliance with law and ethical conduct. Other company policies
discuss more specifically additional conduct that may not be unlawful, but is
prohibited nonetheless; for example, the unauthorized approval of agreements.
For your convenient reference, attached as an addendum to this Code is a chart
summarizing certain prohibited conduct, referencing applicable company policies
and procedures and providing the location of such policies and procedures.
Except as otherwise set forth herein, to the extent that other company polices
and procedures conflict with this Code, you should follow this Code.

2.    SUMMARY OF PROHIBITED CONDUCT

Below is a list of certain conduct prohibited by this Code and/or company
policy. The list is not intended to be all inclusive, nor is it intended to be a
complete description of the prohibited conduct. Instead, it is a high-level
summary of the more egregious forms of prohibited conduct, together with
references to policy documents (other than this Code) where you may obtain

                                       3

further information regarding the prohibited conduct. Any company associate
found to have engaged in any prohibited conduct is subject to discipline up to
and including immediate termination.

You should not only be familiar with the Code, but also with the referenced
policy documents. All referenced policy documents are available on the company
Intranet (http://explorejda.jda.com/) under either the Human Resources or the
Accounting/Legal team intranets. If you have any questions concerning whether
certain conduct may be prohibited by one or more of the company's policies,
please contact your manager, Human Resources, or a member of the Compliance
Team.



PROHIBITED CONDUCT             DETAILS                                      FOR ADDITIONAL INFORMATION, SEE:
- ------------------             -------                                      --------------------------------
                                                                      
INSIDER TRADING                You must not buy or sell company stock       Policies and Procedures Manual --
                               while you possess material, non-public       TRADING RESTRICTIONS ; Insider Trading
                               information                                  Policy

TRADING WINDOWS                If the Insider Trading Policy classifies     Insider Trading Policy
                               you as a "Designated Employee" you must
                               not trade company stock during the
                               quarterly blackout period. In addition,
                               you must not trade company stock if you
                               are informed that you are subject to a
                               special trading blackout.

CHAT ROOMS                     You must not participate in internet chat    Insider Trading Policy
                               room discussions or post on message boards
                               regarding the company or its competitors.

UNAUTHORIZED AGREEMENT         All agreements (including letters of         Policies and Procedures Manual --
APPROVALS                      intent and similar documents) must be        CONTRACTS, AGREEMENTS AND ALLIANCES;
                               approved by the Legal Department.            Internal Contract Controls

UNAUTHORIZED AGREEMENT         Customer agreements (for software,           Contract Process Explanatory Memo; SOW
SIGNATURES                     support, services, worldwide) may only be    Explanatory memo; Internal Contract
                               signed by designated individuals             Controls

SIDE LETTERS                   Side letters (including any email or other   Contract Process Explanatory Memo;
                               communication that adds to or changes the    Contract Tutorial; Internal Contract
                               terms of an agreement) are a form of         Controls
                               agreement and must be authorized by both
                               the company's CEO and CFO

INADEQUATE SOW REVIEW AND      All fixed bid and non-standard time and      SOW Explanatory Memo and SOW FAQ;
SIGNATURE                      materials Statements of Work  ("SOW")        Internal Contract Controls
                               require legal, accounting and



                                       4



PROHIBITED CONDUCT             DETAILS                                      FOR ADDITIONAL INFORMATION, SEE:
- ------------------             -------                                      --------------------------------
                                                                      
                               regional VP approval prior to presentation
                               clients.

UNAUTHORIZED COMMITMENTS       Proposals and RFP responses are not to be    Internal Contract Controls
(PROPOSALS AND RFP RESPONSES)  incorporated into contracts. Do not agree
                               to this in a proposal or RFP response.
                               Exceptions to this policy must be approved
                               in advance by the Company's CEO and
                               General Counsel. Payment terms must be
                               approved by Accounting.

UNAUTHORIZED PURCHASES AND     Purchases of ANY products or services must   Policies and Procedures Manual --
EXPENDITURES                   observe purchasing limits and signature      PURCHASING/REQUISITION POLICY
                               limits.

HARASSMENT AND DISCRIMINATION  Harassment includes creating a hostile       Policies and Procedures Manual -- EQUAL
                               environment  even if no persons of           EMPLOYMENT OPPORTUNITY AND COMPLAINT
                               protected classes are present.               PROCEDURE

DISCLOSING OR MISUSING         Treat all company and client information     Policies and Procedures Manual --
CONFIDENTIAL COMPANY OR        as if it were confidential, unless it is     CONFIDENTIALITY OF COMPANY INFORMATION
CLIENT INFORMATION             available on our web site. In addition,
                               confidential information within the
                               company should be treated strictly on a
                               "need to know" basis.

EXPENSE ACCOUNT/CORPORATE      Corporate cards are for company business     Policies and Procedures Manual --
CREDIT CARD ABUSE              only and, per the agreement, are payable     EXPENSE REPORTS, CREDIT CARDS
                               upon receipt.

MISUSE OF COMPANY SYSTEMS OR   Company computer systems (including          Policies and Procedures Manual --
COMMUNICATIONS                 JDA-issued laptops), email, telephone, fax   SYSTEMS USER POLICY
                               and other devices are for company business
                               and must not be used to receive, store or
                               transmit illegal or objectionable material
                               or for the benefit of another business.
LICENSE OR COPYRIGHT ABUSE     Use of unlicensed software or other          Policies and Procedures Manual --
                               license violations; use of illegal           SYSTEMS USER POLICY
                               material such as illegally downloaded
                               music, video, or images.

OTHER CONDUCT LISTED IN THE                                                 Policies and Procedures Manual --
"TERMINATION" SECTION OF THE                                                TERMINATION
POLICIES AND PROCEDURES
MANUAL



                                       5

3.    COMPLIANCE WITH LAWS AND REGULATIONS

      THE COMPANY SEEKS TO COMPLY WITH THE LAWS AND REGULATIONS IN ALL COUNTRIES
IN WHICH IT OPERATES.

      Numerous federal, state and local laws and regulations define and
establish obligations with which the company, its employees and agents must
comply. Under certain circumstances, local country law may establish
requirements that differ from this Code. You are expected to comply with all
local country laws in conducting the company's business and in performing your
duties for the company, including those prohibiting discrimination based on age,
sex, race, religion or other characteristics. If you violate these laws or
regulations in performing your duties for the company, you not only risk
individual indictment, prosecution and penalties, and civil actions and
penalties, you also subject the company to the same risks and penalties, and you
may be subject to immediate disciplinary action, including possible termination
of your employment or affiliation with the company.

      If you believe there is any conflict between this Code and local laws, you
should consult with a member of the Compliance Team.

4.    FULL, FAIR, ACCURATE, TIMELY AND UNDERSTANDABLE DISCLOSURE

      It is of paramount importance to the company that all disclosure in
reports and documents that the company files with, or submits to, the Securities
and Exchange Commission, and in other public communications made by the company
is full, fair, accurate, timely and understandable. The company maintains a
Disclosure Committee to help oversee its public disclosure. You should consult
with a member of the Compliance Team if you have any concerns about the accuracy
of any public disclosure. You must take all steps available to assist the
company in these responsibilities consistent with your role within the company.
In particular, you are required to provide prompt and accurate answers to all
inquiries made to you in connection with the company's preparation of its public
reports and disclosure.

      Any attempt to enter inaccurate or fraudulent information into the
company's accounting system will not be tolerated and will result in
disciplinary action, up to and including termination of employment.

5.    SPECIAL ETHICS OBLIGATIONS FOR PERSONS WITH FINANCIAL REPORTING
      RESPONSIBILITIES

      Each director, the Chief Executive Officer, President, Chief Financial
Officer and all executive officers elected or designated by the Board of
Directors are Senior Company Representatives. Each Senior Company Representative
bears a special responsibility for promoting integrity throughout the company.
Furthermore, the Senior Company Representatives have a responsibility to foster
a culture throughout the company as a whole that ensures the fair and timely
reporting of the company's results of operation and financial condition and
other financial information.


                                       6

      Because of this special role, the Senior Company Representatives are bound
by the following Financial Officer Code of Ethics, and by accepting the Code of
Business Conduct and Ethics each agrees that he or she will:

   -  Perform his or her duties in an honest and ethical manner.

   -  Refrain from engaging in any activity or having a personal interest that
      presents an actual or apparent conflict of interest. A conflict of
      interest occurs when a person's personal interest interferes, or appears
      to interfere, with the interests of the company. A conflict of interest
      can arise when a Senior Company Representative takes action or has
      interests that prevents or interferes with that person's performing his or
      her company duties and responsibilities honestly, objectively and
      effectively.

   -  Take all necessary actions to ensure full, fair, accurate, timely, and
      understandable disclosure in reports and documents that the company files
      with, or submits to, government agencies and in other public
      communications.

   -  Comply with all applicable laws, rules and regulations of federal, state
      and local governments.

   -  Proactively promote and be an example of ethical behavior in the work
      environment.

6.    INSIDER TRADING

      YOU SHOULD NEVER TRADE SECURITIES ON THE BASIS OF CONFIDENTIAL INFORMATION
ACQUIRED THROUGH YOUR EMPLOYMENT RELATIONSHIP OR SERVICES FOR THE COMPANY AND
SHOULD NEVER DISCLOSE CONFIDENTIAL INFORMATION TO SOMEONE FOR THE PURPOSE OF
ENABLING THEM TO MAKE A PROFIT OR AVOID A LOSS TRADING SECURITIES.

      You are prohibited under both federal law and company policy from
purchasing or selling company stock, directly or indirectly, on the basis of
material non-public information concerning the company. Any person possessing
material non-public information about the company must not engage in
transactions involving company securities until this information has been
released to the public, unless any such transaction is otherwise lawful pursuant
to a 10b5-1 trading plan. Generally, material information is that which would be
expected to affect the investment decisions of a reasonable investor or the
market price of the stock. You must also refrain from trading in the stock of
other publicly held companies, such as existing or potential customers or
suppliers, on the basis of material confidential information obtained in the
course of your employment or service as a director. It is also illegal to
recommend a stock to (i.e., "tip") someone else on the basis of such information
or to pass on confidential information to someone for the purpose of enabling
them to make a profit or avoid a loss trading securities. Both the tipper and
the tippee, and anyone else to whom the tippee passes the information, may be
held liable. If you have a question concerning appropriateness or legality of a
particular securities transaction, consult with a member of the company's
Compliance Team.

      Officers, directors and certain other employees of the company are subject
to additional responsibilities under the company's Insider Trading Policy, a
copy of which has been provided

                                       7

to each such officer, director and employee, and which can be obtained from the
company's Intranet at http://explorejda.jda.com (please select "Legal," then
"Processes & Policies") or from a member of the company's Compliance Team or
Human Resources Department. You should also refer to the "Trading Restrictions"
section of the company's Policies and Procedures Manual, which may also be
obtained from the company's Intranet (at the link referenced above) or from a
member of the Compliance Team or Human Resources Department.

      If the Insider Trading Policy classifies you as a "Designated Employee"
you must not trade the company's stock during the quarterly blackout period.
Additionally, you must not trade the company's stock if you are informed that
you are subject to a special trading blackout. You must not participate in
internet chat room discussions or post on message boards regarding the company
or its competitors. You should refer to the Insider Trading Policy for more
details.

7.    CONFLICTS OF INTEREST

      YOU SHOULD AVOID ANY SITUATION IN WHICH YOUR PERSONAL INTERESTS CONFLICT
OR WOULD APPEAR TO CONFLICT WITH THE COMPANY'S INTERESTS.

      You should avoid entering into situations in which your personal, family
or financial interests may conflict with those of the company. The following are
examples of conflicts that must be declared and resolved:

   -  a conflict situation arises when you, or a member of your family, receives
      improper personal benefits as a result of your position in the company;

   -  a conflict situation can arise when you take business-related actions or
      have interests that make it difficult to perform your company work
      objectively and effectively;

   -  it is almost always a conflict of interest for company employees to work
      simultaneously for a competitor, customer or supplier;

   -  having an interest in a customer, supplier, or competitor (other than
      through mutual funds or through holdings of individual securities worth
      less than $500,000) of the company;

   -  acquiring an interest in property (such as real estate, patent or other
      intellectual property rights or securities) in which you have reason to
      know the company has, or might have, a legitimate interest;

   -  loans to, or guarantees of obligations of, employees and their family
      members may create conflicts of interest;

   -  you may not divulge or use the company's confidential information - such
      as financial data, customer information, or computer programs - for your
      own personal or business purposes;

   -  making gifts or payments, or providing special favors, to customers,
      suppliers or competitors (or their immediate family members) with a value
      significant enough to cause the customer, supplier or competitor to make a
      purchase, or take or forego other

                                       8

      action, which is beneficial to the company and which the customer,
      supplier or competitor would not otherwise have taken; or

   -  you are given the right to buy stock in other companies or receive cash or
      other payments in return for promoting the services of an advisor, such as
      an investment banker, to the company.

      Any transaction proposed between the company and a related party must be
submitted to the company's Audit Committee for review. The company will not,
directly or indirectly, extend or maintain credit, or arrange for an extension
of credit, in the form of a personal loan to or for any executive officer or
director.

      Neither you, nor members of your immediate family, are permitted to
solicit or accept valuable gifts, payments, special favors or other
consideration from customers, suppliers or competitors.

      Conflicts are not always clear-cut. If you become aware of a conflict,
potential conflict, or have a question as to a potential conflict, you should
consult with your manager or a member of the company's Compliance Team and/or
follow the procedures described in Section 12 of this Code. If you become
involved in a situation that gives rise to an actual conflict, you MUST inform
your supervisor or a member of the company's Compliance Team of the conflict.

8.    CORPORATE OPPORTUNITIES

      YOU OWE A DUTY TO THE COMPANY TO ADVANCE ITS LEGITIMATE INTERESTS WHEN THE
OPPORTUNITY TO DO SO ARISES.

      Examples of prohibited conduct include, but are not limited to:

         -  taking for yourself opportunities that are discovered through the
            use of corporate property, information or position;

         -  using corporate property, information, or position for personal
            gain; and

         -  competing with the company.

      If you have any doubt with respect to any opportunity that presents itself
to you, you should seek advice from your supervisor, manager or a member of the
Compliance Team.

9.    CONFIDENTIALITY

      ALL CONFIDENTIAL INFORMATION THAT YOU OBTAIN WHILE EMPLOYED BY OR SERVING
FOR THE COMPANY IS THE PROPERTY OF THE COMPANY AND MUST BE PROTECTED.

      Confidential information includes all non-public information that might be
of use to competitors, or harmful to the company or its customers, if disclosed.
You must maintain the confidentiality of such information entrusted to you by
the company, its customers and its suppliers, except when disclosure is
authorized by the company or required by law. As a matter

                                       9

of practice, you should treat all company and client information as confidential
unless it is available on the company's web site or in its press releases or
other public filings. Additionally, confidential information within the company
should be communicated to other company employees and consultants strictly on a
"need to know" basis.

      Examples of confidential information include, but are not limited to: the
company's trade secrets; business trends and projections; information about
financial performance; new product or marketing plans; research and development
ideas or information; information about potential acquisitions, divestitures and
investments; stock splits, public or private securities offerings or changes in
dividend policies or amounts; significant personnel changes; and existing or
potential major contracts, orders, suppliers, customers or finance sources or
the loss thereof.

      Your obligation with respect to confidential information extends beyond
the workplace. In that respect, it applies to communications with your family
members and continues to apply even after your employment with, or services for,
or director relationship with the company terminates. Additionally, if you are a
company employee, as a condition to your employment, you signed a letter
containing certain agreements regarding confidentiality and assignment of
inventions. You are expected to fully and completely comply with the terms of
that letter agreement. If you have misplaced your copy of this letter, you may
obtain a duplicate copy from a member of the Compliance Team or Human Resources
Department.

      For more details on this topic, you should refer to the company's policy
regarding Confidentiality of Company Information, which can be obtained from the
company's Intranet at http://explorejda.jda.com (please select "Legal," then
"Processes & Policies") or from a member of the Compliance Team or Human
Resources Department.

10.   FAIR DEALING

      OUR GOAL IS TO BE REGARDED AS A COMPANY THAT DOES BUSINESS WITH INTEGRITY.

      You should endeavor to deal with the company's customers, suppliers,
competitors, employees and directors in an honest and forthright manner. Under
federal and state laws, the company is prohibited from engaging in unfair
methods of competition, and unfair or deceptive acts and practices. You should
not take unfair advantage of anyone through manipulation, concealment, abuse of
privileged information, misrepresentation of material facts, or any other unfair
dealing practice.

      Examples of prohibited conduct include, but are not limited to:

   -  bribery or payoffs to induce business or breaches of contracts by others;

   -  acquiring a competitor's trade secrets through bribery or theft;

   -  making false, deceptive or disparaging claims or comparisons about
      competitors or their products or services;

   -  mislabeling products or services;


                                       10

   -  making affirmative claims about the company's products and services
      without having a reasonable basis for doing so.

11.   PROTECTION AND PROPER USE OF COMPANY ASSETS

      YOU SHOULD ENDEAVOR TO PROTECT THE COMPANY'S ASSETS AND ENSURE THEIR
PROPER USE.

      Company assets are to be used only for legitimate business purposes of the
company and only by authorized employees, officers and directors or their proper
designees. This includes both tangible and intangible assets. Intangible assets
include intellectual property such as trade secrets, patents, trademarks and
copyrights, business, marketing and service plans, engineering and manufacturing
ideas, designs, databases, company records, salary information, and any
unpublished financial data and reports. Unauthorized alteration, destruction,
use, disclosure or distribution of company assets violates company policy and
this Code. Theft, carelessness and waste have a direct impact on the company's
profitability and will not be tolerated.

      The company provides computers, voice mail, electronic mail (e-mail), and
Internet access to certain employees for the purpose of achieving the company's
business objectives. As a result, the company has the right to access, reprint,
publish, or retain any information created, sent or contained in any of the
company's computers or e-mail systems of any company machine. You may not use
e-mail, the Internet or voice mail for any illegal purpose or in any manner that
is contrary to the company's policies or the standards embodied in this Code.

      You should not make copies of, or resell or transfer copyrighted
publications, including software, manuals, articles, books, and databases being
used in the company, that were created by another entity and licensed to the
company, unless you are authorized to do so under the applicable license
agreement. In no event should you load or use, on any company computer, any
software, third party content or database without fully complying with the
Systems User Policy. You may use a handheld computing device or mobile phone in
connection with your work for the company, but must not use such device or phone
to access, load or transfer content, software or data in violation of any
applicable law or regulation or without the permission of the owner of such
content, software or data. If you should have any question as to what is
permitted in this regard, please consult with the company's Director of the
Information Technology Group.

      For more details on this topic, you should refer to the company's Systems
User Policy, a copy of which can be obtained from the company's Intranet at
http://explorejda.jda.com (please select "Legal," then "Processes & Policies")
or from a member of the Compliance Team.

12.   REPORTING VIOLATIONS OF COMPANY POLICIES AND RECEIPT OF COMPLAINTS
      REGARDING FINANCIAL REPORTING OR ACCOUNTING ISSUES

      YOU SHOULD REPORT ANY VIOLATION OR SUSPECTED VIOLATION OF THIS CODE TO THE
APPROPRIATE COMPANY PERSONNEL OR VIA THE COMPANY'S ANONYMOUS AND CONFIDENTIAL
REPORTING PROCEDURES.

      The company's efforts to ensure observance of, and adherence to, the goals
and policies outlined in this Code mandate that you promptly bring to the
attention of a member of the Compliance Team or, if appropriate, the Chair of
the Audit Committee, any material transaction,

                                       11

relationship, act, failure to act, occurrence or practice that you believe, in
good faith, is inconsistent with, in violation of, or reasonably could be
expected to give rise to a violation, of this Code.

      You should report any suspected violations of this Code in accordance with
the procedures set forth below.

   -  In the event you believe a violation of the Code, or a violation of
      applicable laws and/or governmental regulations has occurred or you have
      observed or become aware of conduct which appears to be contrary to the
      Code, immediately report the situation to your supervisor, a member of the
      Compliance Team or, if appropriate, the Chair of the Audit Committee.
      Supervisors or managers who receive any report of a suspected violation
      must report the matter to a member of the Compliance Team.

   -  If you have or receive notice of a complaint or concern regarding the
      company's financial disclosure, accounting practices, internal accounting
      controls, auditing, or questionable accounting or auditing matters, you
      MUST immediately advise your supervisor, or a member of the Compliance
      Team or the Chair of the Audit Committee. All such complaints or concerns
      will be forwarded (i) immediately to the Chief Financial Officer and Chief
      Executive Officer, unless the Chief Financial Officer or Chief Executive
      Officer, respectively, is the subject of such complaint, and (ii) promptly
      to the Audit Committee, except any complaints that are determined to be
      without merit by both the General Counsel and Chair of the Audit Committee
      may instead be reported at the next regularly scheduled meeting of the
      Audit Committee. The Audit Committee will evaluate the merits of any
      complaints received and authorize such follow-up actions, if any, as it
      deems necessary or appropriate to address the substance of the complaint.

   -  If you wish to report any such matters anonymously or confidentially, then
      you may do so as follows:

         -  Mail a description of the suspected violation or other complaint or
            concern to:

                  GENERAL COUNSEL OR CHIEF FINANCIAL OFFICER
                  JDA SOFTWARE GROUP, INC.
                  14400 NORTH 87TH STREET
                  SCOTTSDALE, AZ  85260-3649

                  OR

                  AUDIT COMMITTEE CHAIR
                  5430 E. ARCADIA LANE
                  PHOENIX, AZ 85018

   -  Use common sense and good judgment; Act in good faith. You are expected to
      become familiar with and to understand the requirements of the Code. If
      you become aware of a suspected violation, don't try to investigate it or
      resolve it on your own. Prompt

                                       12

      disclosure to the appropriate parties is vital to ensuring a thorough and
      timely investigation and resolution. The circumstances should be reviewed
      by appropriate personnel as promptly as possible, and delay may affect the
      results of any investigation. A violation of the Code, or of applicable
      laws and/or governmental regulations is a serious matter and could have
      legal implications. Allegations of such behavior are not taken lightly and
      should not be made to embarrass someone or put him or her in a false
      light. Reports of suspected violations should always be made in good
      faith.

   -  Internal investigation. When an alleged violation of the Code, applicable
      laws and/or governmental regulations is reported, the company will take
      appropriate action in accordance with the compliance procedures outlined
      in Section 13 of the Code. You are expected to cooperate in internal
      investigations of alleged misconduct or violations of the Code or of
      applicable laws or regulations.

   -  No fear of retaliation. It is a federal crime for anyone to intentionally
      retaliate or take any harmful action against or interfere with the lawful
      employment or livelihood of any person who provides truthful information
      concerning a possible violation of any federal law to a law enforcement
      official. The company will not permit any form of retribution against any
      person, who, in good faith, reports known or suspected violations of
      company policy. In cases in which you report a suspected violation in good
      faith and are not engaged in the questionable conduct, the company
      representative with whom the matter is raised will treat all such
      questions and reports in confidence to the extent consistent with
      effective investigation and will not reveal your identity unless permitted
      to do so by you, or unless required to do so.

13.   COMPLIANCE PROCEDURES

      The company has established this Code as part of its overall policies and
procedures. Except as otherwise set forth herein, to the extent that other
company policies and procedures conflict with this Code, you should follow this
Code. The Code applies to all company directors and company employees, including
all officers, in all locations.

      The Code is based on the company's core values, good business practices
and applicable law. The existence of a Code, however, does not ensure that
directors, officers and employees will comply with it or act in a legal and
ethical manner. To achieve optimal legal and ethical behavior, the individuals
subject to the Code must know and understand the Code as it applies to them and
as it applies to others. You must champion the Code and assist others in knowing
and understanding it.

   -  Compliance. You are expected to become familiar with and understand the
      requirements of the Code. Most importantly, you must comply with it.

   -  CEO Responsibility. The company's CEO shall be responsible for ensuring
      that the Code is established and effectively communicated to all
      employees, officers and directors. Although the day-to-day compliance
      issues will be the responsibility of the company's managers, the CEO has
      ultimate accountability with respect to the overall implementation of and
      successful compliance with the Code.


                                       13

   -  Corporate Compliance Management. The CEO shall choose a team of employees
      who will report to the CEO and be responsible for ensuring that the Code
      becomes an integral part of the company's culture (the "Compliance Team").
      The Compliance Team will consist of the Company's General Counsel and
      Chief Financial Officer and such other personnel as the Chief Executive
      Officer may designate from time to time. The Compliance Team's charter is
      to ensure communication, training, monitoring, and overall compliance with
      the Code. The Compliance Team will, with the assistance and cooperation of
      the company's officers, directors and managers, foster an atmosphere where
      employees are comfortable in communicating and/or reporting concerns and
      possible Code violations.

   -  Internal Reporting of Violations. The company's efforts to ensure
      observance of, and adherence to, the goals and policies outlined in this
      Code mandate that all employees, officers and directors of the company
      report suspected violations in accordance with Section 12 of this Code.

   -  Screening Of Employees. The company shall exercise due diligence when
      hiring and promoting employees and, in particular, when conducting an
      employment search for a position involving the exercise of substantial
      discretionary authority, such as a member of the executive team, a senior
      management position or an employee with financial management
      responsibilities. The company shall make reasonable inquiries into the
      background of each individual who is a candidate for such a position. All
      such inquiries shall be made in accordance with applicable law and good
      business practice.

   -  Access to the Code. The company shall ensure that employees, officers and
      directors may access the Code on the company's website. In addition, each
      current employee will be provided with a copy of the Code. New employees
      will receive a copy of the Code as part of their new hire information. The
      Code will also be assessable through the company's Intranet
      (http://explorejda.jda.com/) (please select "Legal" and then "Processes
      and Policies"). From time to time, the company will sponsor employee
      training programs in which the Code and other company policies and
      procedures will be discussed.

   -  Monitoring. The officers of the company shall be responsible to review the
      Code with all of the company's managers. In turn, the company's managers
      with supervisory responsibilities should review the Code with his/her
      direct reports. Managers are the "go to" persons for employee questions
      and concerns relating to the Code, especially in the event of a potential
      violation. Managers or supervisors will immediately report any violations
      or allegations of violations to a member of the Compliance Team. Managers
      will work with the Compliance Team in assessing areas of concern,
      potential violations, any needs for enhancement of the Code or remedial
      actions to effect the Code's policies and overall compliance with the Code
      and other related policies.

   -  Internal Investigation. When an alleged violation of the Code is reported,
      the company shall take prompt and appropriate action in accordance with
      the law and regulations and otherwise consistent with good business
      practice. If the suspected violation appears to involve either a possible
      violation of law or an issue of significant corporate interest, or if

                                       14

      the report involves a complaint or concern of any person, whether
      employee, a shareholder or other interested person regarding the company's
      financial disclosure, internal accounting controls, questionable auditing
      or accounting matters or practices or other issues relating to the
      company's accounting or auditing, then the manager or investigator should
      immediately notify a member of the Compliance Team who, in turn, shall
      notify the General Counsel and/or Chairman of the Audit Committee, as
      applicable. If a suspected violation involves any director or executive
      officer or if the suspected violation concerns any fraud, whether or not
      material, involving management or other employees who have a significant
      role in the company's internal controls, any person who received such
      report should immediately report the alleged violation to a member of the
      Compliance Team, and if appropriate, the Chief Executive Officer and/or
      Chief Financial Officer, and, in every such case, the Chairman of the
      Audit Committee. The Compliance Team or the Chairman of the Audit
      Committee, as applicable, shall assess the situation and determine the
      appropriate course of action. At a point in the process consistent with
      the need not to compromise the investigation, a person who is suspected of
      a violation shall be apprised of the alleged violation and shall have an
      opportunity to provide a response to the investigator.

   -  Disciplinary Actions. Subject to the following sentence, the Compliance
      Team, after consultation with the Chief Financial Officer or Chief
      Executive Officer, as applicable, shall be responsible for implementing
      the appropriate disciplinary action in accordance with the company's
      policies and procedures for any employee who is found to have violated
      this Code. If a violation has been reported to the Audit Committee or
      another committee of the Board, that Committee shall be responsible for
      determining appropriate disciplinary action. Any violation of applicable
      law or any deviation from the standards embodied in this Code will result
      in disciplinary action, up to and including termination of employment. In
      addition to imposing discipline upon employees involved in non-compliant
      conduct, the company also will impose discipline, as appropriate, upon an
      employee's supervisor, if any, who directs or approves such employees'
      improper actions, or is aware of those actions but does not act
      appropriately to correct them, and upon other individuals who fail to
      report known non-compliant conduct. In addition to imposing its own
      discipline, the company will bring any violations of law to the attention
      of appropriate law enforcement personnel.

   -  Review and Retention of Reports and Complaints. All reports and complaints
      made to or received by the Compliance Team or the Chair of the Audit
      Committee shall be logged into a record maintained for this purpose by the
      Compliance Team, and this record of such report shall be reviewed by the
      Audit Committee at its quarterly meetings and retained for three (3)
      years.

   -  Required Government Reporting. Whenever conduct occurs that requires a
      report to the government, the Compliance Team shall be responsible for
      complying with such reporting requirements.

   -  Corrective Actions. Subject to the following sentence, in the event of a
      violation of the Code, the manager and Compliance Team should assess the
      situation to determine whether the violation demonstrates a problem that
      requires remedial action as to company

                                       15

      policies and procedures. If a violation has been reported to the Audit
      Committee or another committee of the Board, that committee shall be
      responsible for determining appropriate remedial or corrective actions.
      Such corrective action may include providing revised public disclosure,
      retraining company employees, modifying company policies and procedures,
      improving monitoring of compliance under existing procedures and other
      action necessary to detect similar non-compliant conduct and prevent it
      from occurring in the future. Such corrective action shall be documented,
      as appropriate.

14.   PUBLICATION OF THE CODE OF BUSINESS CONDUCT AND ETHICS; AMENDMENTS AND
      WAIVERS OF THE CODE OF BUSINESS CONDUCT AND ETHICS

      The most current version of this Code will be posted and maintained on the
company's website and filed as an exhibit to the company's Annual Report on Form
10-K. The company's Annual Report on Form 10-K shall disclose that the Code is
maintained on the website and shall disclose that substantive amendments and
waivers will also be posted on the company's website.

      Any substantive amendment or waiver of this Code (i.e., a material
departure from the requirements of any provision) particularly applicable to or
directed at executive officers or directors may be made only after approval by
the Board of Directors, after receiving a recommendation from a committee
comprised of a majority of independent directors, and will be disclosed within
five (5) business days of such action in a Form 8-K filed with the Securities
and Exchange Commission. Such disclosure shall include the reasons for any
waiver.


                                       16

EX-21.1

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                                                                               .
                                                                               .

                                                                    EXHIBIT 21.1

                            JDA Software Group, Inc.
                              List of Subsidiaries



               SUBSIDIARY                         JURISDICATION OF INCORPORATION                 DOING BUSINESS AS
               ----------                         ------------------------------                 -----------------
                                                                            
JDA Software Group, Inc.                                 Delaware                 Parent Company

JDA Software, Inc.                                       Arizona                  JDA Software, Inc.

JDA Worldwide, Inc.                                      Arizona                  JDA Worldwide, Inc.
                                                                                  JDA Worldwide, Inc. - UK Branch

JDA Software Australia Pty Ltd                           Australia                JDA Software Australia Pty Ltd

E3 Australia Pty Ltd                                     Australia                Being merged into JDA Software Australia Pty Ltd

JDA Arthur Software Bermuda, Ltd.                        Bermuda                  Dormant

JDA Software Brasil Ltda.                                Brazil                   JDA Software Brasil Ltda.

JDA Software Canada Ltd.                                 Canada                   JDA Software Canada Ltd.

JDA Chile S.A.                                           Chile                    JDA Chile S.A.

JDA Software Danmark ApS                                 Denmark                  JDA Software Danmark ApS

JDA International Limited                                United Kingdom           JDA International Limited
                                                                                  JDA International Limited - Dubai Branch

E3 United Kingdom Limited                                United Kingdom           Being merged into JDA International Limited

JDA Software Oy                                          Finland                  Dormant

JDA Software France SA                                   France                   JDA Software France SA

JDA Software GmbH                                        Germany                  JDA Software GmbH

JDA Software Hong Kong Limited                           Hong Kong                JDA Software Hong Kong Limited

JDA Software Italy S.r.L.                                Italy                    JDA Software Italy S.r.L.

JDA Software Japan Ltd.                                  Japan                    JDA Software Japan Ltd.

JDA Software Malaysia Sdn. Bhd.                          Malaysia                 JDA Software Malaysia Sdn. Bhd.

JDA Software de Mexico, S.A. de C.V.                     Mexico                   JDA Software de Mexico, S.A. de C.V.

JDA Servicios Profesionales, S.A. de C.V.                Mexico                   JDA Servicios Profesionales, S.A. de C.V.

JDA Software Benelux B.V.                                Netherlands              JDA Software Benelux B.V.

JDA Software Norway AS                                   Norway                   JDA Software Norway AS

JDA Asia Pte. Ltd.                                       Singapore                JDA Asia Pte. Ltd.
                                                                                  JDA Asia Pte. Ltd. - Shangai Representative Office

JDA Software South Africa (Proprietary) Limited          South Africa             Dormant

JDA Incorporated Software Solutions, S.A.                Spain                    JDA Incorporated Software Solutions, S.A.

JDA Software Nordic AB                                   Sweden                   JDA Software Nordic AB

EX-23.1

                                                                    EXHIBIT 23.1

CONSENT OF INDEPENDENT AUDITORS

We consent to the incorporation by reference in Registration Statement No.
333-51043 on Form S-3 and Registration Statement Nos. 333-05951, 333-45729,
333-60231, 333-60233, 333-30154, 333-59644, 333-72228, 333-86902, 333-101920,
and 333-111330 of JDA Software Group, Inc. on Form S-8, of our report dated
March 12, 2004, appearing in this Annual Report on Form 10-K of JDA Software
Group, Inc. for the year ended December 31, 2003.

DELOITTE & TOUCHE LLP
Phoenix, Arizona

March 12, 2004

EX-31.1

EXHIBIT 31.1

Certifications

I, Hamish N. J. Brewer, President and Chief Executive Officer of JDA Software Group, Inc. certify that:

1.	I have reviewed this annual report on Form 10-K of JDA Software Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), for the registrant and have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a)	All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: March 12, 2004	By:	/s/ Hamish N. J. Brewer
		Hamish N. J. Brewer
		President and Chief Executive Officer

EX-31.2 14 p68834exv31w2.htm EX-31.2

EXHIBIT 31.2

Certifications

I, Kristen L. Magnuson, Executive Vice President and Chief Financial Officer of JDA Software Group, Inc. certify that:

1.	I have reviewed this annual report on Form 10-K of JDA Software Group, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)), for the registrant and have:

a.	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c.	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a.	All significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b.	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date: March 12, 2004	By:	/s/ Kristen L. Magnuson
		Kristen L. Magnuson
		Executive Vice President and Chief Financial Officer
		(Principal Financial and Accounting Officer)

EX-32.1 15 p68834exv32w1.htm EX-32.1

EXHIBIT 32.1

Certification of Chief Executive Officer And Chief Financial Officer Pursuant to 18 U.S.C. Section 1350,
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

We, Hamish N. J. Brewer, President and Chief Executive Officer and Kristen L. Magnuson, Executive Vice President and Chief Financial Officer of JDA Software Group, Inc. (the “Registrant”), do hereby certify in accordance with 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, based upon each of our respective knowledge:

(1) the Annual Report on Form 10-K of the Registrant, to which this certification is attached as an exhibit (the “Report”), fully complies with the requirements of section 13(a) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Dated: March 12, 2004	/s/ Hamish N. J. Brewer
	Hamish N. J. Brewer
	President and Chief Executive Officer
	/s/ Kristen L. Magnuson
	Kristen L. Magnuson
	Executive Vice President and
	Chief Financial Officer

This certificate accompanies this annual report on Form 10-K pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and will not be deemed “filed” by the Registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. This certificate will not be deemed to be incorporated by reference into any filing, except to the extent that the Registrant specifically incorporates it by reference.

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EX-31.2

exv31w2

EX-32.1

exv32w1