<PAGE>
Exhibit (a)(1)(Y)
SUPPLEMENT TO THE
OFFER TO PURCHASE FOR CASH
ANY AND ALL OUTSTANDING
SHARES OF CLASS A COMMON STOCK
OF
PCORDER.COM, INC.
AT
$6.375 NET PER SHARE
BY
TRILOGY SOFTWARE, INC.
DATED NOVEMBER 6, 2000
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON WEDNESDAY, DECEMBER 6, 2000, UNLESS THE OFFER IS EXTENDED.
THIS OFFER IS BEING MADE PURSUANT TO AN AGREEMENT AND PLAN OF MERGER, DATED
AS OF OCTOBER 25, 2000, BY AND AMONG TRILOGY SOFTWARE, INC., POI ACQUISITION
CORP., INC. AND PCORDER.COM, INC.
THE BOARD OF DIRECTORS OF PCORDER.COM, INC., BASED UPON THE UNANIMOUS
RECOMMENDATION OF A SPECIAL COMMITTEE OF INDEPENDENT DIRECTORS, (A) HAS
DETERMINED THAT EACH OF THE OFFER AND THE MERGER IS FAIR TO AND IN THE BEST
INTERESTS OF PCORDER.COM, INC.'S STOCKHOLDERS (OTHER THAN TRILOGY SOFTWARE,
INC. AND ITS AFFILIATES), (B) HAS APPROVED THE AGREEMENT AND PLAN OF MERGER AND
THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER, AND
(C) RECOMMENDS THAT THE STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES
HEREUNDER.
DAIN RAUSCHER WESSELS, FINANCIAL ADVISOR TO THE SPECIAL COMMITTEE, HAS
DELIVERED AN OPINION TO THE SPECIAL COMMITTEE AND THE BOARD OF DIRECTORS OF
PCORDER TO THE EFFECT THAT, AS OF OCTOBER 24, 2000, AND SUBJECT TO THE
QUALIFICATIONS, ASSUMPTIONS AND LIMITATIONS STATED IN ITS OPINION, THE CASH
CONSIDERATION PROPOSED TO BE RECEIVED BY PCORDER.COM, INC.'S STOCKHOLDERS
(OTHER THAN TRILOGY SOFTWARE, INC. AND ITS AFFILIATES) IN THE OFFER AND THE
MERGER WAS FAIR, FROM A FINANCIAL POINT OF VIEW, TO SUCH STOCKHOLDERS.
THIS OFFER IS NOT CONDITIONED UPON ANY MINIMUM NUMBER OF SHARES BEING
TENDERED. THIS OFFER IS SUBJECT TO OTHER TERMS AND CONDITIONS DESCRIBED HEREIN.
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
shares of Class A common stock, par value $0.01 per share (the "SHARES" or the
"CLASS A COMMON STOCK"), of pcOrder.com, Inc. ("PCORDER") should either (i)
complete and sign the Letter of Transmittal, or a facsimile thereof, in
accordance with the instructions in the Letter of Transmittal, have such
stockholder's signature thereon guaranteed (if required by Instruction 1 to the
Letter of Transmittal), mail or deliver the Letter of Transmittal, or such
facsimile and any other required documents to the Depositary (as defined in the
Offer to Purchase) and either deliver the certificates for such Shares to the
Depositary or tender such Shares pursuant to the procedures for book-entry
transfer set forth in "The Tender Offer--Section 3. Procedures for Tendering
Shares" in the Offer to Purchase, or (ii) request such stockholder's broker,
dealer, commercial bank, trust company or other nominee to effect the
transaction for such stockholder. Any stockholder whose Shares are registered
in the name of a broker, dealer, commercial bank, trust company or other
nominee must contact such broker, dealer, commercial bank, trust company or
other nominee to tender such Shares.
Any stockholder who desires to tender Shares and whose certificates
evidencing such Shares are not immediately available, or who cannot comply with
the procedures for book-entry transfer described in the Offer to Purchase on a
timely basis, or who cannot deliver all required documents to the Depositary
prior to the expiration of the Offer, may tender such Shares by following the
procedures for guaranteed delivery set forth in "The Tender Offer--Section 3.
Procedures for Tendering Shares" in the Offer to Purchase.
Questions and requests for assistance or for additional copies of the Offer
to Purchase, this Supplement, the related Letter of Transmittal or other Offer
materials may be directed to MacKenzie Partners, Inc. (the "INFORMATION AGENT")
or SG Cowen Securities Corporation (the "DEALER MANAGER") at their respective
addresses and telephone numbers set forth on the back cover of this Offer to
Purchase. Stockholders may also contact brokers, dealers, commercial banks or
trust companies for assistance concerning the Offer.
---------------
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE FAIRNESS OR MERITS OF SUCH TRANSACTION OR UPON THE ACCURACY OR ADEQUACY OF
THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY
IS UNLAWFUL.
---------------
The Information Agent for the Offer is:
MACKENZIE PARTNERS, INC.
The Dealer Manager for the Offer is:
SG COWEN SECURITIES CORPORATION
The date of this Supplement to the Offer to Purchase is November 17, 2000.
<PAGE>
To the Holders of Class A Common Stock of
pcOrder.Com, Inc.:
INTRODUCTION
The following information amends and supplements the Offer to Purchase dated
November 6, 2000 (the "OFFER TO PURCHASE") of Trilogy Software, Inc., a
Delaware corporation ("TRILOGY"), pursuant to which Trilogy is offering to
purchase any and all outstanding shares of Class A common stock, par value
$0.01 per share (the "SHARES" or the "CLASS A COMMON STOCK"), of pcOrder.com,
Inc. ("PCORDER"), at $6.375 per Share, net to the tendering stockholder in cash
(the "OFFER PRICE"), upon the terms and subject to the conditions set forth in
the Offer to Purchase, this Supplement and the related Letter of Transmittal
(which together, as they may be amended or supplemented from time to time,
constitute the "OFFER").
This Supplement should be read in conjunction with the Offer to Purchase.
The terms and conditions set forth in the Offer to Purchase and the Letter of
Transmittal previously mailed to stockholders remain applicable in all respects
to the Offer. Capitalized terms used but not defined herein have the meaning
assigned to them in the Offer to Purchase.
STOCKHOLDERS ARE URGED TO READ THE OFFER TO PURCHASE, THIS SUPPLEMENT AND
THE RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO TENDER
THEIR SHARES.
TABLE OF CONTENTS*
<TABLE>
<CAPTION>
PAGE
NO.
----
<S> <C>
SPECIAL FACTORS........................................................... S-3
Background of the Offer and the Merger.................................. S-3
Position of Trilogy Regarding Fairness of the Offer and the Merger...... S-3
Analysis of Financial Advisor to Trilogy................................ S-5
Purpose and Structure of the Offer and the Merger; Reasons of Trilogy
for the Offer and the Merger........................................... S-5
Beneficial Ownership of Shares.......................................... S-5
Transactions and Arrangments Concerning the Shares...................... S-5
Certain Financial Projections........................................... S-6
Certain Litigation...................................................... S-6
THE TENDER OFFER.......................................................... S-6
1. Terms of the Offer; Expiration Date................................. S-6
5. Certain U.S. Federal Income Tax Consequences........................ S-6
9. Source and Amount of Funds.......................................... S-7
13. Certain Conditions to the Offer..................................... S-7
15. Miscellaneous....................................................... S-7
</TABLE>
--------
*The captions included in this Table of Contents correspond to captions in the
Offer to Purchase and the supplemental information set forth under each such
caption in this Supplement amends and supplements the information set forth
under the corresponding caption in the Offer to Purchase.
S-2
<PAGE>
SPECIAL FACTORS
BACKGROUND OF THE OFFER AND THE MERGER
The discussion set forth in "Special Factors--Background of the Offer and
the Merger" of the Offer to Purchase is amended and supplemented as follows:
During the discussions between the pcOrder Special Committee and its
advisors on October 17 and 18, 2000 at which Trilogy's $5.00 per Share
acquisition proposal was considered, the pcOrder Special Committee reviewed
with DRW the state of pcOrder's business and the uncertainty concerning
pcOrder's viability as a stand-alone entity. In that connection, certain
qualitative factors relevant to an evaluation of pcOrder were discussed
including:
. ambiguous technology licenses leading to unclear lines of separation
between pcOrder and Trilogy over the ownership of products;
. the challenges to the marketability of pcOrder to a third party due to
Trilogy's control of pcOrder, Trilogy's competing business unit and the
difficulty associated with separating the intellectual property of
pcOrder and Trilogy;
. high employee turnover at pcOrder for several months; and
. no new significant software customers for the last nine months.
During these discussions on October 17 and 18, 2000, the pcOrder Special
Committee also reviewed with DRW possible approaches to value, including
estimated values that might be ascribed to some of pcOrder's assets in a
transaction with Trilogy that could provide one basis for seeking to negotiate
a higher per Share price from Trilogy. Assets reviewed included: cash on the
latest balance sheet net of balance sheet liabilities; intellectual property
rights, considering solely licensing fees payable by Trilogy to pcOrder;
pcOrder's content and community business, considering solely one preliminary
indication of value received by pcOrder during the second quarter of 2000 in
discussions with a third party that subsequently broke off because of business
issues; pcOrder's tax loss carryforwards, assuming all the carryforwards would
be available to Trilogy; and the value of key personnel, based solely on
estimated recruiting costs provided by pcOrder's management. The review of
these assets resulted in a range of estimated values for a transaction with
Trilogy that yielded a range of per Share values from approximately $4 to
approximately $6. In these discussions, DRW advised the pcOrder Special
Committee that DRW had not performed, been engaged to perform, or been provided
with, any appraisal of pcOrder's assets; that DRW had assumed and relied upon,
without independent verification, the information concerning the reviewed
assets furnished by pcOrder management; that the value of pcOrder's non-cash
assets was incapable of accurate valuation and was inherently uncertain and
speculative; that estimated non-appraised asset valuations of this nature would
not be part of the methodology employed by DRW under established investment
banking practice to determine whether it could render a favorable opinion
concerning the fairness of the proposed transaction consideration; and that DRW
was not in a position to express, and was not expressing, any opinions as to
asset values or the sufficiency of the review made for the purposes of the
discussions with the pcOrder Special Committee.
POSITION OF TRILOGY REGARDING FAIRNESS OF THE OFFER AND THE MERGER
The discussion set forth in "Special Factors--Position of Trilogy Regarding
Fairness of the Offer and the Merger" of the Offer to Purchase is amended and
supplemented as follows:
Trilogy believes that the Offer and the Merger are both procedurally and
substantively fair to the Unaffiliated Stockholders. Trilogy bases its belief
on the factors expressed under the corresponding caption in the Offer to
Purchase, as supplemented by the following:
. Trilogy believed that the market price of the Shares was unlikely to
attain the level of its Offer Price of $6.375 per Share unless and until
pcOrder was able to achieve revenue growth and begin to generate
operating profits. Based on pcOrder's deteriorating financial condition,
the development of
S-3
<PAGE>
adverse conditions in business-to-business and business-to-consumer e-
commerce, the decline of the sales and distribution channel in the
personal computer industry and the substantially uncertain ability of
pcOrder to achieve revenue growth and begin to generate operating
profits, as established by the projected financial performance of
pcOrder, Trilogy believes that its Offer Price of $6.375, an 85% premium
over the closing price of the Shares on the last trading day prior to
the public announcement of the Offer and the Merger, was a fair price
for the Shares of the Unaffiliated Stockholders.
. Trilogy also believes the Offer and the Merger, including the Offer
Price, are fair to the Unaffiliated Stockholders because of the
existence of the following procedures and factors, in addition to those
identified in the Offer to Purchase, all of which Trilogy believes
enhance the protection of the Unaffiliated Stockholders in connection
with the Offer and the Merger:
(1) The lack of any provision in the Merger Agreement prohibiting
subsequent third party bids for pcOrder, coupled with the provision only
for a modest expense reimbursement of $1.25 million payable by pcOrder
to Trilogy if pcOrder terminates the Merger Agreement to accept a
superior offer;
(2) The fact that the conditions to Trilogy's obligations to
consummate the Offer are customary and, in Trilogy's view, not unduly
onerous;
(3) The fact that, to the extent that any pcOrder stockholders chose
not to tender their Shares into the Offer or accept the Offer Price
pursuant to the Merger but, rather, exercised statutory appraisal rights
under Delaware law in connection with the Merger (see "Special Factors--
Dissenters' Rights" of the Offer to Purchase), such exercise would not
impair Trilogy's obligation to consummate the Merger, provided the Offer
is consummated. Accordingly, pcOrder stockholders who believed that the
exercise of statutory appraisal rights would yield them a greater per
Share amount than the Offer Price would be free to pursue such exercise
without adversely affecting the ability of the other pcOrder
stockholders to receive the Offer Price for their Shares.
(4) The fact that the Merger Agreement did not preclude pcOrder from
implementing measures to improve its operating results during the
pendency of the Offer because the restrictions on the conduct of
business by pcOrder imposed by the Merger Agreement would not apply to
actions either approved by Trilogy or which were in the ordinary course
of business for pcOrder. Thus, pcOrder stockholders would not be subject
to the risk that, if the Merger Agreement were terminated, pcOrder would
be worse off at that point because it had been unable to implement
measures to improve its operating results during the pendency of the
Merger Agreement.
(5) The fact that Trilogy had cash on hand to consummate the Offer
and the Merger, thus not subjecting pcOrder stockholders to the risk of
financing conditions to the Offer and the Merger;
(6) The fact that the Merger Agreement provided that (a) Trilogy
could not take any action to remove from office or impair the authority
of any member of the pcOrder Special Committee and (b) all of the rights
of pcOrder under the Merger Agreement, including, without limitation,
rights of waiver and enforcement, were vested exclusively in the pcOrder
Special Committee and were exercisable only with the consent of, or at
the express direction of, the pcOrder Special Committee. This provision
ensured that, despite the fact that Trilogy's stock ownership in pcOrder
gave it the power to remove the current pcOrder Board, pcOrder, through
the pcOrder Special Committee, was not precluded from taking such action
as might be appropriate to seek to ensure that Trilogy's obligations
under the Merger Agreement were satisfied and pcOrder's rights
thereunder were enforced.
Triology took into account that the liquidation value and the net book
value to Unaffiliated Stockholders of the pcOrder Shares was less than the
Offer Price. Trilogy determined that the going concern value of the pcOrder
business was insignificant. Historical market prices of the Shares were a
factor in Trilogy's
S-4
<PAGE>
determination of fairness as discussed in the first bullet point above. Because
Trilogy has not purchased any Shares or other securities of pcOrder during the
past two years, prices paid in previous purchases were not a factor in
Trilogy's determination of fairness of the transactions. Further, Trilogy is
unaware of any offers for merger with pcOrder or for the purchase or transfer
of all or any substantial part of the assets of pcOrder or for the purchase of
a control position in pcOrder's Shares in the past two years, and thus no such
offer was a factor in Trilogy's determination of fairness.
Sub adopts Trilogy's analysis and conclusions as to the fairness of the
Offer and the Merger, as expressed in this Supplement and in the Offer to
Purchase.
ANALYSIS OF FINANCIAL ADVISOR TO TRILOGY
The discussion set forth in "Special Factors--Analysis of Financial Advisor
to Trilogy" of the Offer to Purchase is amended and supplemented as follows:
For SG Cowen's services to Trilogy as financial advisor in connection with
Trilogy's general financial strategy regarding Trilogy's reinvestment in
pcOrder, including services as Dealer Manager for the Offer, Trilogy will pay
SG Cowen approximately $1.1 million, including fees and estimated expenses of
SG Cowen and its counsel. In December 1999, Trilogy paid SG Cowen approximately
$1,458,350 in underwriting discounts and commissions in connection with SG
Cowen's services as an underwriter in a public offering and sale by Trilogy of
Shares. In 1999, pcOrder paid SG Cowen approximately $1,011,600 in underwriting
discounts and commissions for services by SG Cowen as an underwriter of two
public offerings by pcOrder during 1999. See "Special Factors--Transactions and
Arrangements Concerning the Shares" of the Offer to Purchase.
PURPOSE AND STRUCTURE OF THE OFFER AND THE MERGER; REASONS OF TRILOGY FOR THE
OFFER AND THE MERGER
The discussion set forth in "Special Factors--Purpose and Structure of the
Offer and the Merger; Reasons of Trilogy for the Offer and the Merger" of the
Offer to Purchase is amended and supplemented as follows:
After completion of the Offer and the Merger, Trilogy's interests in the net
book value of pcOrder will increase from $33,819,000 to $54,409,000 and its
interest in the net earnings of pcOrder will increase from a negative
$20,256,000 to a negative $24,104,000.
BENEFICIAL OWNERSHIP OF THE SHARES
The discussion set forth in "Special Factors--Beneficial Ownership of the
Shares" of the Offer to Purchase is amended and supplemented as follows:
Of the Shares shown in the table as beneficially owned by Trilogy and Joseph
A. Liemandt, 16,000 are subject to options granted by Trilogy to certain of its
employees, entitling them to purchase those shares at any time prior to August
25, 2009, at a price of $5.00 per share.
Christina C. Jones, pcOrder's President and Chief Operating Officer, owns
1,200 Shares that were not included in the table, and her aggregate beneficial
ownership of shares is therefore 641,300.
TRANSACTIONS AND ARRANGEMENTS CONCERNING THE SHARES
The discussion set forth in "Special Factors--Transactions and Arrangements
Concerning the Shares" of the Offer to Purchase is amended and supplemented as
follows:
Employees of Trilogy hold options granted by Trilogy to acquire a total of
16,000 Shares at any time prior to August 25, 2009, at a price of $5.00 per
Share. Trilogy intends to offer to buy out these options for $1.375 per Share,
the difference between the exercise price and the Offer Price, conditioned on,
and concurrently with, the closing of the Merger.
S-5
<PAGE>
CERTAIN FINANCIAL PROJECTIONS
The discussion set forth in "Special Factors--Certain Financial Projections"
of the Offer to Purchase is amended and supplemented as follows:
Although the projections provided in this section were not prepared with a
view to public disclosure or in compliance with any published guidelines
regarding projections and are inherently subject to many assumptions and
uncertainties, including those described in "Special Factors--Certain Financial
Projections," these projections reflect the best good faith estimates of
pcOrder's management based on information known to them and subject to these
assumptions and inherent uncertainties.
CERTAIN LITIGATION
The discussion set forth in "Special Factors--Certain Litigation" of the
Offer to Purchase is amended and supplemented as follows:
On November 15, 2000, the Delaware Chancery Court signed a notice of
dismissal filed by the plaintiffs who had filed the Delaware Complaints. As a
result, the Delaware Complaints have been voluntarily dismissed without
prejudice.
On November 8, 2000, an additional purported class action lawsuit was filed
against pcOrder, its five directors and Trilogy in the District Court of Travis
County, Texas entitled Jerry Krim v. pcOrder.com et al., Court No. GN00327 (the
"Second Texas Petition"). The substantive allegations and the relief sought in
the Second Texas Petition are virtually identical to the Delaware Complaints.
Although the Second Texas Petition, includes general claims for injunctive
relief, to the knowledge of pcOrder and Trilogy, the plaintiff has not filed a
motion requesting the Texas court to prohibit the closing of the Offer or the
Merger. pcOrder and Trilogy each intends to defend against this lawsuit
vigorously. The Second Texas Petition, like the First Texas Petition and the
Delaware Complaints (and the dismissal thereof), has been filed with the SEC as
a exhibit on Schedule TO filed by Trilogy and on Schedule 13E-3 filed by
pcOrder. See "The Tender Offer--Section 15. Miscellaneous" of the Offer to
Purchase for information on how to obtain copies of these documents.
THE TENDER OFFER
1. Terms of the Offer; Expiration Date
The discussion set forth in "The Tender Offer--Section 1. Terms of the
Offer; Expiration Date" of the Offer to Purchase is amended and supplemented as
follows:
If Trilogy were to elect to provide a Subsequent Offering Period under Rule
14d-11 under the Exchange Act, Trilogy would be required to (i) waive all
conditions to the Offer or deem all conditions to be satisfied on or before the
scheduled Expiration Date, (ii) accept and promptly pay for all Shares tendered
prior to the then scheduled Expiration Date and (iii) accept and promptly pay
for all Shares as they were tendered in the Subsequent Offering Period. Trilogy
would also be required to announce the results of the Offer, including the
approximate number and percentage of Shares that have been tendered, no later
than 9:00 a.m., New York City time, on the next business day after the
scheduled Expiration Date. No withdrawal rights would be available to tendering
stockholders in the Subsequent Offering Period.
5. Certain U.S. Federal Income Tax Consequences
The discussion set forth in "The Tender Offer--Section 5. Certain U.S.
Federal Income Tax Consequences" of the Offer to Purchase is amended and
supplemented as follows:
S-6
<PAGE>
The Merger and the consummation of the Offer will not constitute taxable
transactions, for United States federal income tax purposes, to any of Trilogy,
Sub or pcOrder.
9. Source and Amount of Funds
The discussion set forth in "The Tender Offer--Section 9. Source and Amount
of Funds" of the Offer to Purchase is amended and supplemented as follows:
The existing resources that Trilogy will use to consummate the Offer and the
Merger consist solely of cash on hand.
13. Certain Conditions to the Offer
The discussion set forth in "The Tender Offer--Section 13. Certain
Conditions to the Offer" of the Offer to Purchase is amended and supplemented
as follows:
In exercising its good faith judgment and sole discretion for purposes of
whether any of the events set forth in this section makes it inadvisable to
proceed with the Offer or the acceptance for payment of, or payment for, Shares
thereunder, Trilogy undertakes to exercise its good faith judgment and sole
discretion in a reasonable manner.
All conditions, other than those involving receipt of necessary government
approvals, will be satisfied or waived on or before expiration of the Offer if
Trilogy purchases Shares pursuant to the Offer and none of such conditions,
except those involving receipt of necessary government approvals, will remain
in effect once the Offer expires unless the Offer expires in accordance with
its terms without Trilogy having accepted any tendered Shares by reason of any
such condition not having been satisfied prior to expiration.
15. Miscellaneous
Trilogy has filed with the SEC an Offer Statement on Schedule TO, as
amended, together with all exhibits thereto, pursuant to Regulation M-A under
the Exchange Act, furnishing certain additional information with respect to the
Offer. Such Schedule TO also constitutes Trilogy's Rule 13E-3 Transaction
Statement on Schedule 13E-3 furnishing certain additional information
applicable to "going private" transactions. pcOrder and Sub have filed with the
SEC a Rule 13E-3 Transaction Statement on Schedule 13E-3, together with all
exhibits thereto, pursuant to Rule 13(e)-3 under the Exchange Act, furnishing
certain additional information applicable to "going private transactions." In
addition, pcOrder has filed a Solicitation/Recommendation Statement on Schedule
14D-9, as amended, together with all exhibits thereto, pursuant to Rule 14d-9
of the Exchange Act setting forth its recommendation with respect to the Offer
and the reasons for such recommendation, and furnishing certain additional
related information. Such filings and any amendments thereto, including
exhibits, may be inspected and copies may be obtained from the offices of the
SEC in the manner set forth in "The Tender Offer--Section 7. Certain
Information Concerning pcOrder" of the Offer to Purchase (except that they will
not be available at the regional offices of the SEC).
Trilogy Software, Inc.
November 17, 2000
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