When you install a new version of ArcGIS Desktop, ArcGIS Engine, or ArcGIS Server Workgroup edition, you can upgrade the geodatabases you have stored in your the database server. You might also need to upgrade the SQL Server Express instance to a newer, supported release.
Before upgrading the SQL Server Express instance or any geodatabases, create backup files of all geodatabases.
See Upgrade SQL Server Express and Upgrade a workgroup geodatabase for instructions.