Filed by Onyx Software Corporation
Pursuant to Rule 425 under the Securities Act of 1933
And deemed filed pursuant to Rule 14a-12
Under the Securities Exchange Act of 1934
Subject Company: Pivotal Corporation
Commission File No. 0-26867
IMPORTANT INFORMATION
The communications included in this filing are not solicitations of a proxy from
any security holder of Pivotal Corporation or Onyx Software Corporation. Nor are
these communications an offer to purchase nor a solicitation of an offer to sell
securities. Any offer will be made only through an exchange offer statement,
information circular, proxy statement or similar document. Investors and
security holders are strongly advised to read such document regarding the
proposed business combination referred to in this communication, if and when
such document is filed and becomes available, because it will contain important
information. Any such document would be filed by Onyx Software Corporation with
the U.S. Securities and Exchange Commission (SEC). Investors and security
holders may obtain a free copy of such document (if and when filed and
available) and other relevant documents related to the proposed business
combination on the SEC's web site at: . Any such document and
related materials may also be obtained for free by directing such requests to
Onyx at 425-451-8060. Onyx Software Corporation and its executive officers and
directors may be deemed to be participants in the solicitation of proxies from
Pivotal Corporation and Onyx Software Corporation security holders in favor of
the proposed transaction, should Onyx Software Corporation solicit such proxies.
Information regarding the security ownership and other interests of Onyx
Software Corporation's executive officers and directors will be included in any
such exchange offer statement, information circular, proxy statement or similar
document.
FORWARD-LOOKING STATEMENT
The content of the communications included in this filing may contain
forward-looking statements, including statements about the likelihood that the
Pivotal Board of Directors will accept the Onyx proposal, the anticipated
economic performance of Onyx and Pivotal as a combined company, and the impact
of the proposed transaction on shareholders of Onyx and Pivotal. Forward-looking
statements are based on the opinions and estimates of management at the time the
statements are made and are subject to risks and uncertainties that could cause
actual results to differ materially from those anticipated in the
forward-looking statements. The words "believe," "expect," "intend,"
"anticipate," variations of such words, and similar expressions identify
forward-looking statements, but their absence does not mean that the statement
is not forward-looking. These statements are not guarantees of future
performance and are subject to risks, uncertainties and assumptions that are
difficult to predict. Factors that could affect Onyx's actual results include,
but are not limited to the risk that the Pivotal
Board of Directors elects not to accept the Onyx proposal, the risk that Onyx
and Pivotal are unable to reach a definitive agreement, the risk that even if
such a definitive agreement is reached that the resulting business combination
will not realize the anticipated economic benefits, the risk that Onyx common
stock declines or otherwise underperforms over time, the risk that the attention
of Onyx's management is diverted from the operation of its core business, and
the "Important Factors That May Affect Our Business, Our Results of Operations
and Our Stock Price" described in our quarterly report on form 10-Q for the
period ended June 30, 2003. Readers are cautioned not to place undue reliance
upon these forward-looking statements that speak only as to the date of this
filing. Onyx undertakes no obligation to update publicly any forward-looking
statements to reflect new information, events or circumstances after the date of
this release or to reflect the occurrence of unanticipated events
***
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[The following communication is posted on Onyx Software Corporation's website]
PUBLIC Q&A
ANNOUNCEMENT HIGHLIGHTS
Q: WHAT DID ONYX ANNOUNCE?
On November 12, 2003 Onyx announced an unsolicited proposal to acquire
Pivotal Corporation.
Q: WHY DID ONYX DECIDE TO ACQUIRE PIVOTAL?
Acquiring Pivotal increases our strong leadership in the CRM mid-market
and we believe it will accelerate our profitable growth. After the acquisition
Onyx will be the second largest pure-play CRM company with 2,600 customers and
over $110 million in annual revenues. In addition, we believe that our proposal,
which represents a 26% premium over the existing offer, is a better alternative
for Pivotal's shareholders and customers.
Q: WHAT ARE THE TERMS OF THE OFFER?
Under the terms of the proposal, Onyx would exchange 0.475 shares of Onyx
Software common stock for each common share of Pivotal Corporation. Based on the
closing price of Onyx common stock on November 11, 2003 of $4.73, this proposal
equates to $2.25 for each share of Pivotal common stock, or a 26% premium over
the existing offer to Pivotal shareholders. Additionally, the transaction would
be structured to enable Pivotal shareholders to defer tax on the transaction
until they ultimately dispose of their shares of Onyx common stock.
Q: WHAT IS THE TIMING OF THE OFFER?
Onyx would propose an aggressive closing timeline in order to combine our
respective companies as quickly as practical.
Q: HOW LONG WILL THE OFFER REMAIN OPEN?
We have asked the Pivotal Board of Directors to respond to our proposal by
Friday, November 14(th) at 2:00 pm Pacific Standard Time.
Q: WILL YOUR OFFER BE SUBJECT TO ANY CONDITIONS?
Our proposal is conditioned on the termination of the Talisma agreement
prior to the closing of that transaction and the execution of a definitive
agreement between Pivotal and Onyx. In addition, the offer will be subject to
regulatory requirements of the United States Securities and Exchange Commission
and the Nasdaq National Market.
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Q: HOW DOES THE ONYX OFFER COMPARE TO THE RECENTLY ANNOUNCED OFFER FROM
OAK INVESTMENT PARTNERS?
We believe the Onyx proposal is superior for Pivotal shareholders and
customers for the following reasons:
- Our proposal is 26 percent higher than the existing offer, based on the
closing price of Onyx stock on November 11, 2003.
- Our offer gives Pivotal shareholders a similar investment vehicle -- stock in
a CRM vendor -- with a significant potential upside.
- The Onyx-Pivotal combination would be larger than the proposed Pivotal-Talisma
entity and allow for economies of scale
- We believe that Onyx has a better operational profile than Pivotal or Talisma:
a more experienced and stable management team, strong financial leadership and
performance, and industry-respected technology leadership.
ABOUT THE BUSINESS COMBINATION
Q: HOW WILL THE COMBINED COMPANIES BE POSITIONED IN THE MARKET?
Acquiring Pivotal increases our leadership in the CRM mid-market. The
combined entity will have over 2600 customers and more than $110 million in
revenues, making it the second largest pure play CRM vendor behind Siebel. In
addition, a combined Onyx-Pivotal organization would have strength in key market
segments such as financial services, healthcare, government, and technology.
Q: HOW MUCH OVERLAP EXISTS BETWEEN ONYX'S MARKET FOCUS AND PIVOTAL'S
MARKET FOCUS?
Although Onyx and Pivotal compete in the same general market (mid-market
CRM), we overlap slightly. Onyx focused on the mid-market and up into enterprise
size customers while Pivotal focuses on the mid-market and below.
Q: HOW MANY EMPLOYEES WILL BE IN THE COMBINED COMPANY?
Following completion of the acquisition a more detailed staffing plan will
be developed that takes into consideration the operations of both companies.
Onyx would expect to increase investments in strategic sales, marketing and R&D
initiatives while reducing the combined companies' G&A expenses.
Q: WHAT NAME WILL THE COMBINED COMPANY OPERATE UNDER?
The combined entity will operate under the Onyx Software brand and be
headquartered in Bellevue, Washington.
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FOR PIVOTAL CUSTOMERS
Q: WHAT IMPACT DOES THE MERGER HAVE ON PIVOTAL CUSTOMERS?
Onyx has a heritage of outstanding customer support, the industry's
highest customer satisfaction ratings, and a self-confessed obsession for
helping our customers experience CRM success. This means that the investment
Pivotal customers have made in CRM will be shepherded by a company with a
long-term commitment to the CRM industry and a domain expertise relevant to
their business needs.
Q: WHAT WILL HAPPEN TO THE PIVOTAL PRODUCT LINE?
Onyx will continue to provide support for Pivotal's product line after the
acquisition. We have a heritage of outstanding customer support, and extending
that satisfaction to Pivotal's customers will be the driver in ongoing product
related decisions..
Q: WILL PIVOTAL CUSTOMERS BE FORCED TO MIGRATE TO ONYX?
No. Onyx intends to support the Pivotal product line, although we believe
that Pivotal customers who require an Internet-architected solution will find
that Onyx is ahead of the technology curve with a solution TODAY that exceeds
the functionality of client-server CRM offerings. We intend to create
integration packages between the products.
ABOUT ONYX
Q: WHAT IS THE HISTORY OF ONYX?
Onyx was founded in 1994 and was the first CRM vendor to provide an
integrated suite of marketing, sales and service solutions. In addition to the
core CRM platform, Onyx stable of offerings includes solutions for partner
relationship management, online collaboration, contact centers, and business
intelligence. Onyx provides a robust, enterprise strength application with that
is both scalable and flexible enough to accommodate the unique business
requirements of each of its customers, yet does so in a manner that allows for
rapid deployment and low TCO. The average implementation time for Onyx is 16
weeks, and we believe that the implementation costs for Onyx are one third that
of the leading competitor.
Onyx has a strong legacy of mid-market leadership, and has been
consistently recognized for maintaining high levels of satisfaction within its
customer base. In fact, in a recent survey by Peerstone Research, 91% of Onyx
customers indicated that if they had to start all over with their CRM project,
they would once again choose Onyx. In 2003 alone, Onyx was recognized for its
leadership in mid-market CRM by Gartner and was named the #1 mid-market CRM
vendor by CRM Magazine.
Onyx also has a reputation for technology innovation. Onyx was one of the
first CRM vendors to re-architect its application to a true, 3-tier, Internet
architecture, and as
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a result our current application exceeds the feature set delivered by our
previous client server application. More than 65% of our customers have migrated
to a web-based version of Onyx. Today Onyx CRM is delivered via a 4(th)
generation web-based platform that is completely web services enabled, making it
easier to deploy, manage, customize and integrate with other IT systems.
Nearly 1,000 companies in 50 different industries have licensed Onyx
software to date. Onyx is particularly strong in financial services, where 5 of
the top 6 asset management firms in the world utilize Onyx, including State
Street, Dreyfus, and Strong Capital. Onyx also has a leading presence in
healthcare, with customers like Regence, UPMC, HealthNow, and VHA. In the
Government Sector, Onyx is one of the top three providers of solutions to local
governments in the United Kingdom and has an emerging presence at the state
level in the US. More than 150 technology companies use Onyx, and global
organizations like Starbucks, Amway, American Express, Microsoft, NTL, and
Airborne Express have chosen Onyx.
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[The following communication is posted on Onyx Software Corporation's website]
(ONYX GRAPHIC)
OPEN LETTER TO PIVOTAL CUSTOMERS
As you may know, Onyx Software has a legacy of outstanding customer
support, the industry's highest customer satisfaction ratings, and a
self-confessed obsession for helping our customers experience CRM success. On
becoming a member of the Onyx family, I pledge to you that our very first
initiative will be to aggressively engage with you to see how we can drive even
more value into your existing CRM investment. When we submitted our proposal to
acquire Pivotal, we considered Pivotal's customer to be its biggest asset. As an
Onyx customer, be assured that you will receive all the consideration and care
that's been at the core of Onyx for nearly a decade.
Brent Frei
CEO, Onyx Software
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[The following communication was sent to industry anaysts via email]
Greetings,
This morning Onyx submitted an unsolicited bid to acquire Pivotal at a 26%
premium over the existing offer from Talisma, as financed by Oak Investment
Partners. We made this proposal because we believe the time is right to
consolidate the CRM midmarket and we believe Onyx can leverage Pivotal's assets
better than anyone else in this space.
The offer further demonstrates our commitment to serving the CRM
mid-market and, if accepted, we believe it would accelerate our profitable
growth. We firmly believe that this is a superior proposal for Pivotal's
shareholders and customers as the combined company would be the second largest
independent CRM company with over 2600 customers, more than $110 million in
annual revenues and significant geographic coverage.
The combination clearly makes a lot of sense. Onyx and Pivotal both
understand the midmarket and its desire for more than the generic functionality
of low-end solutions and fear of complex, costly-to-implement software. We share
a legacy of development on the Microsoft platform. We both sell broadly to a
variety of industries, yet we also each have dedicated efforts to focus on
specific verticals.
In addition, we see this as a tremendous opportunity for Pivotal
customers.
- The investment Pivotal customers have made in CRM will be shepherded
by a company with a long-term commitment to the CRM midmarket.
- Onyx has a legacy of providing superior customer service, and we are
consistently at the top of independent surveys for customer
satisfaction.
- We have a fourth-generation Internet platform that TODAY exceeds the
functionality of our client-server product line. Pivotal customers
may leverage that capability immediately.
I want to make sure that you are able to connect personally with one of
our executives to discuss this exciting news. Please contact Dan Reidy of our PR
agency (contact info below), who can arrange some time.
Dan Reidy, Principal
Reidy Communications
dan@reidycommunications.com
O-415-482-8650/M-415-497-3109
F-415-532-2521
Regards,
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Patrick Angelel
Vice President Marketing
Onyx Software
This document is neither an offer to purchase nor a solicitation of an
offer to sell securities. Any offer will be made only through an exchange offer
statement or proxy statement/prospectus. Investors and security holders are
strongly advised to read such document regarding the proposed offer referred to
in this press release, if and when such document is filed and becomes available,
because it will contain important information. Any such exchange offer statement
or proxy statement/prospectus would be filed by Onyx with the U.S. Securities
and Exchange Commission (SEC). Investors and security holders may obtain a free
copy of the exchange offer statement or proxy statement/prospectus (if and when
filed and available) and other relevant documents on the SEC's web site at:
www.sec.gov. Any such exchange offer statement or proxy statement/prospectus and
related materials may also be obtained for free by directing such requests to
Onyx at 425-451-8060.
FORWARD-LOOKING STATEMENT
This document contains forward-looking statements, including statements about
the merits of the Onyx proposal relative to the existing Talisma offer, the
anticipated economic performance of Onyx and Pivotal as a combined company and
the impact of the proposed transaction on shareholders of Onyx and Pivotal.
Forward-looking statements are based on the opinions and estimates of management
at the time the statements are made and are subject to risks and uncertainties
that could cause actual results to differ materially from those anticipated in
the forward-looking statements. The words "believe," "expect," "intend,"
"anticipate," variations of such words, and similar expressions identify
forward-looking statements, but their absence does not mean that the statement
is not forward-looking. These statements are not guarantees of future
performance and are subject to risks, uncertainties and assumptions that are
difficult to predict. Factors that could affect Onyx's actual results include,
but are not limited to the risk that the Pivotal Board of Directors elects not
to accept the Onyx proposal, the risk that Onyx and Pivotal are unable to reach
a definitive agreement, the risk that even if such a definitive agreement is
reached that the resulting business combination will not realize the anticipated
economic benefits, the risk that Onyx common stock declines or otherwise
underperforms over time, the risk that the attention of Onyx's management is
diverted from the operation of its core business, and the "Important Factors
That May Affect Our Business, Our Results of Operations and Our Stock Price"
described in our quarterly report on form 10-Q for the period ended June 30,
2003. Readers are cautioned not to place undue reliance upon these
forward-looking statements that speak only as to the date of this release. Onyx
undertakes no obligation to update publicly any forward-looking statements to
reflect new information, events or circumstances after the date of this release
or to reflect the occurrence of unanticipated events.
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