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                                  EXHIBIT 99.1


We have incurred significant losses in the past few years and we may not regain
profitability into the foreseeable future which could cause our stock price to
fall.

We cannot assure you that we will regain profitability in the near future. Our
ability to increase revenue and regain profitability will be affected by the
other risks and uncertainties described in this Exhibit. Our failure to regain
profitability could cause our stock price to further decline and impair our
ability to finance our operations. If we execute to our business plan, we
anticipate achieving break-even during the second half of 2003. However, we may
not achieve this goal for a number of reasons, including:

     -    decline in the sales of our products and services during 2003; and
     -    failure to reduce expenses to sufficient levels in line with our
          revenues.

Our fluctuating operating results could cause our stock price to fall.

Our quarterly revenue and operating results are difficult to predict and may
fluctuate significantly from quarter to quarter. If our quarterly revenue or
operating results fall below the expectations of investors or public market
analysts, the price of our common stock could fall substantially.

Our quarterly operating results have varied or may vary depending on a number of
factors, including the following:

     -    fluctuations in demand for our products and services;
     -    changes in the mix of our products and services and related margins;
     -    changes in the mix of our licensing arrangements and related timing of
          revenue recognition;
     -    the size, timing, and contractual terms of licenses and sales of our
          products and services;
     -    customer financial constraints and credit-worthiness;
     -    the current economic slowdown affecting the economy generally or our
          industry in particular;
     -    the current geopolitical uncertainty which may impact the timing and
          amounts of technology investments;
     -    our ability to control costs, including managing planned reductions in
          expense levels; and
     -    our ability to develop, introduce, and market new products and
          enhancements to our existing products and services on a timely basis.

As a result of these and other factors, our revenue and operating results are
difficult to predict. Because our revenue from services is largely correlated to
our license revenue, a decline in license revenue could also cause a decline in
our services revenue in the same quarter or in subsequent quarters. In addition,
an increase or decrease in hardware sales, which provide us with lower gross
margins than sales of software licenses or services, may cause variations in our
quarterly operating results.

Our expense levels are based, in part, on our expectations regarding future
revenue increases. As a result, any shortfall in revenue in relation to our
expectations would not necessarily cause a reduction in our costs. This could
result in significant quarterly losses and significant changes in our operating
results from quarter to quarter and could result in quarterly losses. In
addition, we incurred restructuring and severance charges of $1.2 and $1.9
million in fiscal 2002 and 2001, respectively as a result of workforce
reductions and other actions in response to declines in revenue and
organizational restructuring. We may incur additional restructuring charges if
we experience additional revenue declines. As a result of these factors, we
believe that period-to-period comparisons of our revenue levels and operating
results are not necessarily meaningful. You should not rely on our historical
quarterly revenue and operating results to predict our future performance.

Macro-economic or other external influences may affect our performance.

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Our business has been adversely impacted by the economic slowdown, particularly
the decline in information technology spending. We expect the economic slowdown
to continue to adversely impact our business for at least the next few quarters
and perhaps longer. The adverse impacts from the slowdown include longer sales
cycles, higher selling costs, lower average selling prices, and reduced bookings
and revenues.

Approximately 82.5% of our revenues and the vast majority of our profits and
cash flows are derived within the United States. Since the fourth quarter of
2000, a declining United States economy began to adversely impact the
performances of many businesses particularly within the technology sector. We
are a technology company selling technology-based software products and services
with total pricing, in many cases, exceeding $1.0 million. A reduction in the
capital budgets of our customers and prospective customers has an adverse impact
on our ability to sell our software products and services. A prolonged recession
of the US economy will likely result in less capital expenditures, which may
adversely impact our business and/or our ability to compete.

Lengthening sales cycles, deferrals of anticipated orders and changes in the
size and scope of contracts with customers may cause fluctuation in our
operating results.

Our quarterly revenues are subject to fluctuation because they depend on the
sale of relatively small number of orders for our products and related services.
Many of these orders are realized at the end of the quarter. As a result, our
quarterly operating results may fluctuate significantly if we are unable to
complete several substantial sales in any given quarter. We have recently
experienced lengthening sales cycles and deferrals of a number of anticipated
orders, which we believe have been affected by general economic uncertainty and
our potential customers' concerns over making significant capital expenditures
in light of this uncertainty.

A customer's decision to license and implement our software products may present
significant enterprise-wide implications for the customer and involve a
substantial commitment of its management and resources. The period of time
between initial customer contact and the purchase commitment typically ranges
from six to eighteen months for our applications. Our sales cycle could extend
beyond current levels as a result of lengthy evaluation and approval processes
that typically accompany major initiatives or capital expenditures or other
delays over which we have little or no control.

In addition, our goal is to provide more comprehensive software products and
service offerings for our customers, as opposed to only licensing software. As
the complexity of the problems our customers seek to solve increases, the size
and scope of our contracts with customers increase, which could result in:

     -    delays in negotiating and completing contracts; and
     -    contracts which vary significantly from our standard contract and
          which could cause differing accounting treatments for the revenue from
          each contract.

Any of these factors could cause our revenue to decline or fluctuate
significantly in any quarter and could cause a decline in our stock price.

The mix of our revenues among license fees, services and PCS, and hardware
products may adversely impact our operating results.

Because service and PCS and hardware revenues have lower gross margins than
license revenues, an increase in the percentage of total revenue represented by
services and third party software and hardware revenues could have a detrimental
impact on our overall gross margins and could adversely affect operating
results. Further, the mix between services that are provided by our employees
versus services provided by third-party consultants could impact gross margins.
In addition, a significant portion of our revenue in any period is comprised of
the resale of third-party hardware products to our customers. While revenue from
hardware sales as a percentage of total revenue increased in 2002, we may not
continue to see increased growth in hardware revenue in the future. If we are
not able to increase our revenue from software licenses and services or maintain
our hardware revenue, our ability to achieve profitability may be adversely
affected.

We may require additional capital which may not be available.

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We may require additional capital to finance our growth, to fund acquisitions,
or investments in complementary businesses, technologies or product lines. Our
capital requirements will depend on many factors, including:

     -    our cash flow from operating activities;
     -    the timing of and extent to which we invest in new technology; and
     -    the impact of acquisitions that we may make.

To the extent that our resources are insufficient to fund our future activities,
we may need to raise additional funds through public or private financing.
However, additional funding, if needed, may not be available on terms attractive
to us, or at all. Our inability to raise capital when needed could have a
material adverse effect on our business, operating results, and financial
condition.

In addition, the terms of our existing credit facility do not provide us with
additional liquidity. In order to borrow under our existing credit facility, we
must have cash collateral equal to/or in excess of the amount sought to be
borrowed. If we are unable to renegotiate the terms of this credit facility or
put into place a new credit facility, we will not be able to effectively use our
line of credit at a time that we would most need it.

RISKS RELATED TO OUR BUSINESS AND INDUSTRY

We may fail to execute on our business plan which may adversely affect our
operating results.

We could fail to execute our plan in several areas, including:

     -    failing to maintain and adhere to expense reduction programs;
     -    failing to meet our revenue goals;
     -    failing to develop and introduce our products in a timely and cost
          efficient manner;
     -    failing to maintain referenceable accounts;
     -    failing to develop and market products and services that adequately
          meet market requirements or achieve market acceptance;
     -    failing to manage our direct sales organization;
     -    failing to manage growth of our operations;
     -    failing to maintain continuity in our executive officers;
     -    failing to improve our operational, financial, and management
          controls;
     -    failing to develop the management skills of our managers and
          supervisors; and
     -    failing to train and motivate our employees.

If we fail to achieve our business objectives, our sales and operating results
could be adversely affected.

Our strategic partner relationships may not be successful, which would adversely
affect our revenue growth.

We have established several strategic relationships with certain companies over
the past several years, including SAP. When we first entered into these
strategic relationships, we expected that these companies would play an
important role in the marketing of our products and service offerings. To date,
we have not achieved the positive impact on our operating results that was
originally expected from these strategic relationships. For example, only
approximately 1% of our revenues in 2002 resulted from our SAP relationship.
There is no guarantee that our strategic relationships will be successful in
creating a larger market for our product offerings.

We have recently experienced significant changes in our senior management team
and there is no assurance the team will work together effectively.

In 2001, we changed our executive management team. James B. Treleaven, our Chief
Executive Officer, joined us in July 2001. All of our other present executive
officers joined us after Mr. Treleaven. Our success depends on the ability of
our management team to work together effectively. Our business, revenue and
financial condition will be

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materially and adversely affected if our senior management team does not manage
our company effectively or if we are unable to retain our executive management.

Our inability to attract and retain management and other key personnel may
adversely affect us.

Our future performance depends on the continued service of our executive and
senior management, product development, and sales personnel. The loss of the
services of one or more of our key personnel could seriously harm our business.
In addition, our success depends on our continuing ability to attract, hire,
train, and retain a selected number of highly skilled managerial, technical,
sales, marketing, and customer support personnel. Our ability to retain key
employees may be difficult, given recent adverse changes in our business.
Moreover, all employees receive options to purchase our stock as a part of their
compensation package. To the extent that our stock price does not increase, the
value of these options will be small, which could cause employees to be more
likely to leave employment. In addition, new hires frequently require extensive
training before they achieve desired levels of productivity. Competition for
qualified personnel is intense, and we may fail to retain our key employees or
to attract or retain other highly qualified personnel. The cost of hiring and
retaining skilled employees is high, and this reduces our profitability. Failure
to attract and retain highly skilled personnel could materially and adversely
affect our business.

Our market is very competitive and we may not be able to effectively compete.

We compete in markets that are intensely competitive. The intensity of
competition has increased and is expected to further increase in the future.
This increased competition has resulted in price reductions and reduced gross
margins, and could result in loss of market share, any one of which events could
seriously harm our business. Competitors vary in size and in the scope and
breadth of the products and services they offer.

We face competition from:

     -    supply chain execution vendors, including, Manhattan Associates, Inc.,
          EXE Technologies, Inc., Optum, Inc., and Red Prairie among others;
     -    Enterprise Resource Planning ("ERP") or Supply Chain Management
          ("SCM") application vendors that offer varying degrees of warehouse
          management functionality or modules of their product suites, such as
          ReTek, JD Edwards, Oracle or SAP;
     -    the corporate information technology departments of potential
          customers capable of internally developing software products; and
     -    smaller independent companies that have developed or are attempting to
          develop warehouse management software.

We may face competition in the future from business application software vendors
that may broaden their product offerings by developing or acquiring warehouse
management software. ERP and SCM vendors have a large number of strong customer
relationships, which could provide a significant competitive advantage. New
competitors or alliances among current and new competitors may emerge and
rapidly gain significant market share. Many of our current or potential future
competitors have longer operating histories, greater financial, technical,
marketing and other resources, greater name recognition, and a larger installed
base of customers than we do. In the past, we have lost potential customers to
competitors for various reasons, including lower prices and incentives not
matched by us. In addition, current and potential competitors have established
or may establish cooperative relationships among themselves or with third
parties to increase the ability of their products to address customer needs.
Accordingly, it is possible that new competitors or alliances among competitors
may emerge and rapidly acquire significant market share. We also expect that
competition will increase as a result of industry consolidations.



If the development of our products and services fails to keep pace with our
industry's rapid evolving technology, our future results may be materially and
adversely affected.

The markets for supply chain management software products and services are
subject to rapid technological change, changing client needs, frequent new
product introductions, and evolving industry standards that may render existing

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products and services obsolete. A substantial portion of our revenue comes from
the sale of our flagship product, CatalystCommand and related services and third
party products. We expect this pattern to continue. Accordingly, our future
operating results will depend on the demand for CatalystCommand by future
customers, including new and enhanced releases that are subsequently introduced.

Our growth and future operating results will depend, in part, upon our ability
to enhance our existing applications and develop and introduce new applications
or capabilities that:

-    meet or exceed technological advances in the marketplace;
-    meet changing client requirements;
-    comply with changing industry standards;
-    achieve market acceptance;
-    integrate third-party products effectively; and
-    respond to competitive offerings.

In addition, we may not successfully identify new software opportunities or
develop and bring new software to market in a timely and efficient manner. If we
are unable, for technological or other reasons, to develop and introduce new and
enhanced software in a timely manner, we may lose existing clients and fail to
attract new clients, which may adversely affect our performance.

Our existing products could be rendered obsolete if we fail to continue to
advance our technology. We believe that our future success will depend upon our
ability to continue to enhance our current product line while we concurrently
develop and introduce new products that keep pace with competitive and
technological developments. These developments require us to continue to make
substantial product development investments. Although we are presently
developing a number of product enhancements to our product suite, we cannot
assure you that these enhancements will be completed on a timely basis or gain
customer acceptance.

Our software may contain undetected errors or "bugs" resulting in harm to our
reputation and operating results.

Software products as complex as those offered by us might contain undetected
errors or failures when first introduced or when new versions are released. This
may result in loss of, or delay in, market acceptance of our products. Our
software products are frequently integrated with third party software, which may
also contain errors. We cannot assure you, despite testing by us and by current
and prospective customers, that errors will not be found in our products or
product enhancements after commercial release. Any errors found may cause
substantial harm to our reputation and result in additional unplanned expenses
to remedy any defects, as well as a loss in revenue. Errors and failures in our
products could result in the loss of customers and market share or delay in
market adoption of our applications, and alleviating these errors and failures
could require us to expend significant capital and other resources. The
consequences of these errors and failures could materially and adversely affect
our business, results of operations and financial condition. In addition, if our
products fail to function as required, we may be subject to claims for
substantial damages. Courts may not enforce provisions in our contracts that
would limit our liability or otherwise protect us from liability for damages.
Although we maintain general liability insurance coverage, including coverage
for errors or omissions, this coverage may not continue to be available on
reasonable terms or in sufficient amounts to cover claims against us.

We have limited protection of intellectual property rights and may potentially
infringe third party intellectual property rights.

We rely on a combination of copyright, trademark and trade secret laws, as well
as confidentiality agreements and licensing arrangements, to establish and
protect our proprietary rights. Despite our efforts to protect our proprietary
rights, existing copyright, trademark and trade secret laws afford only limited
protection. In addition, the laws of certain foreign countries do not protect
our rights to the same extent as do the laws of the United States. Any
infringement of our proprietary rights could negatively impact our future
operating results. Furthermore, policing the unauthorized use of our products is
difficult and litigation may be necessary in the future to enforce our
intellectual property rights, to protect our trade secrets, or to determine the
validity and scope of the proprietary rights of others.

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Litigation could result in substantial costs and diversion of resources and
could negatively impact our future operating results.

It is possible that third parties will claim that we have infringed their
current or future products. 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 licensing agreements, any of which could
negatively impact our operating results. We cannot assure you that these royalty
or licensing agreements, if required, would be available on terms acceptable to
us, if at all. We cannot assure you that legal action claiming patent
infringement will not be commenced against us, or that we would prevail in
litigation given the complex technical issues and inherent uncertainties in
patent litigation. If a claim against us were successful and we could not obtain
a license on acceptable terms, license a substitute technology, or redesign to
avoid infringement, we may be prevented from distributing our software or caused
to incur significant expense and delay in developing non-infringing software. In
addition, any successful claim of infringement would result in liability for
actual damages, attorneys' fees and costs, and potentially treble damages, if
appropriate.

If we cannot integrate acquired companies with our business, our profitability
may be adversely affected.

As part of our business strategy, we may seek to acquire or invest in additional
businesses, products, or technologies that may complement or expand our
business. If we identify an appropriate acquisition opportunity, we may not be
able to negotiate the terms of that acquisition successfully, finance it, or
integrate it into our existing business and operations. We may not be able to
select, manage, or absorb any future acquisitions successfully, particularly
acquisitions of large companies. Further, the negotiation of potential
acquisitions, as well as the integration of an acquired business, would divert
management time and other resources. We may use a substantial portion of our
available cash to make an acquisition. On the other hand, if we make
acquisitions through an exchange of our securities, our stockholders could
suffer dilution. In addition, any particular acquisition, even if successfully
completed, may not ultimately benefit our business.

There are many risks associated with international operations.

We have committed resources to the opening and integration of additional
international sales and support channels. Our efforts to develop and expand
international sales and support channels may not be successful. International
operations are subject to many risks, including the following:

-    difficulties in managing international VARs;
-    difficulties and expenses associated with complying with a variety of
     foreign laws and unexpected changes in regulatory requirements;
-    longer accounts receivable payment cycles and difficulties in collecting
     accounts receivable;
-    increased transaction costs related to sales transactions conducted outside
     the U.S.;
-    reduced protection of intellectual property rights and increased risk of
     piracy;
-    differing technology standards, translations, and localization standards;
     and
-    political and economic instability abroad.

RISKS RELATED TO AN INVESTMENT IN OUR STOCK

Our stock price is highly volatile and has limited liquidity.

The trading price of our common stock has fluctuated significantly since our
initial public offering in November 1995 and could continue to be subject to
wide fluctuations in response to various factors, including:

     -    variations in our quarterly operating results;
     -    changes in analysts' estimates of our performance or industry
          performance;
     -    changes in market valuations of similar companies;
     -    weakening economic conditions;
     -    conditions or trends in the market for supply chain software products
          and service offerings;
     -    speculation in the press or investment community;

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     -    strategic actions by our competitors, such as acquisitions,
          announcements of new products or service enhancements, technological
          innovations, or significant business initatives;
     -    fluctuations in stock market price and volume, which are particularly
          common among highly volatile securities of software companies; and
     -    other events or factors that may be beyond our control.

In addition, the stock market has experienced volatility that has particularly
affected the market prices of equity securities of many technology companies.
These broad market fluctuations may adversely affect the market price of our
common stock.

At December 31, 2002, the value of our stock held by persons who are not our
affiliates, was approximately $2,960,000. The size of our public float limits
the liquidity of our stock, or the ability of investors to purchase or sell our
stock quickly. This lack of liquidity could deter some investors from purchasing
our stock and could also lead to increased volatility in our stock price.

Our Common Stock has been delisted from the Nasdaq National Market and is now
regulated as a penny stock which, among other things, restricts the ability of
broker-dealers to buy or sell our securities. This restriction may effect the
ability of holders to buy or sell our securities in the secondary market and may
also effect the price at which such holders can buy or sell our securities. The
delisting from Nasdaq may cause our stock to be less attractive to investors and
may make it more difficult to raise additional financing in the future.

Substantial control by directors, executive officers, and affiliates control the
Company's affairs and policies.

Our directors, executive officers, and greater-than 5% shareholders together
control approximately 60% of our outstanding common stock. As a result, these
shareholders, if they act together, are able to influence the management and
affairs of our company and all matters requiring shareholder approval, including
the election of directors and approval of significant corporate transactions.
This concentration of ownership may have the effect of delaying or preventing a
change in control of our company and might affect the market price of the common
stock.

Our certificate of incorporation, bylaws, and Delaware law may inhibit a
takeover of our Company.

Our certificate of incorporation and our bylaws, in conjunction with Delaware
law, contain provisions that could make it more difficult for a third party to
obtain control of us. For example, our certificate of incorporation provide for
a classified board of directors and allow our board of directors to expand its
size and fill any vacancies without stockholder approval. In addition, our
certificate of incorporation requires a two-thirds vote of stockholders to
remove a director from office and then only for cause. Certain of these
provisions: (a) allow the board of directors to issue preferred stock with
rights senior to those of the common stock and to designate certain other
preferences with respect to such shares without any further vote or action by
the stockholders, (b) eliminate the right of stockholders to act by written
consent, (c) make it more difficult for stockholders to remove directors or to
elect a majority of the board of directors, (d) eliminate cumulative voting, and
(e) impose various procedure and other requirements which could make it more
difficult for stockholders to effect certain corporate actions. A shareholder
may consider any or all of these provisions to be disadvantageous.