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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO
RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
(AMENDMENT NO. 1)
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BREAKAWAY SOLUTIONS, INC.
(Name of Issuer)
Common Stock, Par Value $.000125 Per Share
(Title of Class of Securities)
105372 10 5
(CUSIP number)
Henry N. Nassau, Esq.
Managing Director and General Counsel
Internet Capital Group, Inc.
The 600 Building
435 Devon Park Drive
Wayne, PA 19087
(610) 989-0111
(Name, address and telephone number of
Person Authorized to Receive Notices
and Communications)
Copy to:
Christopher G. Karras, Esq.
Dechert
4000 Bell Atlantic Tower
1717 Arch Street
Philadelphia, Pennsylvania 19103-2793
January 19, 2001
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following
box [_]
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CUSIP No. 105372 10 5
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1) Name of Reporting Person Internet Capital Group, Inc.
SS. Or I.R.S. Identification 23-2996071
No. of Above Person
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2) Check the Appropriate Box (a) [_]
if a Member of a Group (b) [_]
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3) SEC Use Only
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4) Source of Funds OO
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5) Check Box if Disclosure of
Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) [_]
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6) Citizenship or Place of Organization Delaware
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Number of Shares 7) Sole Voting
Beneficially Owned By Power 15,229,234
Reporting Person With ----------------------------
8) Shared Voting
Power 9,737,447
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9) Sole Dispositive
Power 15,229,234
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10) Shared Dispositive
Power 9,737,447
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11) Aggregate Amount Beneficially
Owned by Each Reporting Person 24,966,681
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12) Check Box if the Aggregate Amount
in Row (11) Excludes Certain Shares [_]
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13) Percent of Class Represented
by Amount in Row (11) 44.7%
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14) Type of Reporting Person CO
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2
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1) Name of Reporting Person ICG Holdings, Inc.
SS. Or I.R.S. Identification 51-0396570
No. of Above Person
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2) Check the Appropriate Box (a)[_]
if a Member of a Group (b)[_]
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3) SEC Use Only
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4) Source of Funds WC
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5) Check Box if Disclosure of
Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) [_]
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6) Citizenship or Place of Organization Delaware
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Number of Shares 7) Sole Voting
Beneficially Owned By Power 0
Reporting Person With ---------------------------
8) Shared Voting
Power 9,737,447
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9) Sole Dispositive
Power 0
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10) Shared Dispositive
Power 9,737,447
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11) Aggregate Amount Beneficially
Owned by Each Reporting Person 9,737,447
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12) Check Box if the Aggregate Amount
in Row (11) Excludes Certain Shares [_]
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13) Percent of Class Represented
by Amount in Row (11) 17.4%
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14) Type of Reporting Person CO
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ITEM 1. SECURITY AND ISSUER
This Amendment No. 1 to Schedule 13D amends and supplements the
Schedule 13D filed with the Securities and Exchange Commission on January 26,
2001.
This Statement on Schedule 13D relates to the acquisition of warrants
(the "Warrants") to purchase up to 9,737,447 shares of Common Stock, par value
$.000125 per share (the "Common Stock"), at a per share exercise price of
$.6875, of Breakaway Solutions, Inc. (the "Issuer"), whose principal executive
office is located at 2 Seaport Lane, Boston, MA 02210. The Common Stock is
currently traded on the NASDAQ under the symbol "BWAY."
The exercise price of the Warrants and the number of shares of Common
Stock underlying the Warrants are subject to adjustment upon certain events as
described in the warrant filed as Exhibit 1 hereto, the terms of which are
incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND
(a) The names of the filing persons are Internet Capital Group, Inc.,
a Delaware corporation ("ICG") and ICG Holdings, Inc., a Delaware corporation
("ICGH," together with ICG, the "Reporting Persons"). ICGH is a wholly-
owned subsidiary of ICG. The name, address, present principal occupation
or employment and, if applicable, the name, principal business and address
of any corporation or other organization in which such employment is
conducted, of the directors and executive officers of the Reporting Persons
(collectively, the "Directors and Executive Officers") are set forth in
Appendix I hereto, which is incorporated herein by reference.
(b)-(c) The address of the principal office and principal place of
business of ICG is The 600 Building, 435 Devon Park Drive, Wayne, PA 19087. ICG
is an Internet company actively engaged in business to business e-commerce
through a network of partner companies. ICGH's principal business is to hold
securities. The address and principal place of business of ICGH is Pencader
Corporate Center, 100 Lake Drive, Suite 4, Newark, DE 19702.
(b) During the past five years, none of the Reporting Persons or the
Directors and Executive Officers have been convicted in a criminal proceeding.
(c) During the past five years, none of the Reporting Persons or the
Directors and Executive Officers have been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction and as a result
of such proceeding was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities
subject to, federal or state securities laws or finding any violation with
respect to such laws.
(d) Each of the Directors and Executive Officers is a United States
citizen, except Nigel Andrews, who is a citizen of the United Kingdom.
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ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
On January 19, 2001, ICGH entered into agreements for a secured
financing pursuant to which ICGH loaned the Issuer $5.0 million at an interest
rate of 12% per annum (or 18% after an event of default). Principal and
interest on this loan are due on March 12, 2001, and are secured by a pledge of
substantially all of the Issuer's assets. As partial consideration for such
loan, the Issuer issued ICGH the Warrants.
ITEM 4. PURPOSE OF TRANSACTION
ICGH acquired the Warrants as partial consideration for the loans
described more fully in Item 3.
ICG has acquired the Warrants through its wholly-owned subsidiary
ICGH, and the Common Stock, as part of its operating strategy to integrate ICG's
partner companies into a collaborative network that leverages its collective
knowledge and resources. ICG intends to review, from time to time, its interest
in the Issuer on the basis of various factors, including but not limited to the
Issuer's business, financial condition, results of operations and prospects,
synergies with other partner companies and integration in the network, general
economic and industry conditions, as well as other developments and other
acquisition opportunities. Based upon those considerations, ICG may seek to
exercise the Warrants in whole or in part, acquire additional shares of Common
Stock on the open market or in privately negotiated transactions, or to dispose
of all or a portion of the Warrants or the Common Stock, including the Common
Stock underlying the Warrants.
Except as set forth above, the Reporting Persons and the Directors
and Executive Officers have not formulated any plans or proposals of the types
referred to in clauses (a) through (j) of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a)-(b) Before the exercise of any of the Warrants, ICG may be
deemed to be the beneficial owner with the sole power to vote and dispose of a
total of 15,229,234 shares of Common Stock (or 32.9% of the outstanding Common
Stock). ICGH may be deemed to be the beneficial owner of the Common Stock
underlying the Warrants, which would, if fully exercised, give ICGH 9,737,447
shares of Common Stock (or 17.4% of the outstanding Common Stock). Because ICGH
is a wholly-owned subsidiary of ICG, ICG may be deemed to be the beneficial
owner of the Common Stock underlying the Warrants, with ICG and ICGH sharing the
power to exercise the Warrants, and upon exercise of the Warrants, to vote and
dispose of the shares of Common Stock underlying the Warrants. Walter W.
Buckley, III, the President, Chief Executive Officer and a director of ICG and
the President and a director of ICGH, jointly with his wife Susan Buckley, are
the beneficial owners of 50,000 shares of Common Stock. Mr. and Mrs. Buckley
share the power to vote and dispose of these shares.
(c) On December 5, 2000, Henry N. Nassau, the Managing Director,
General Counsel and Secretary of ICG and a Vice President, Secretary and a
director of ICGH, sold 5,700 shares of Common Stock on the open market at a
price of $2.0313 per share and 1,300 shares on the open market at a price of
$2.00 per share. On December 1, 2000, Dr. Thomas P. Gerrity, a director of ICG,
purchased 3,500 shares of Common Stock on the open market at a price of $2.1875
per share,
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16,500 shares of Common Stock on the open market at a price of $2.25 per share
and 11,200 shares of Common Stock at a price of $2.3125 per share. On December
20, 2000, Dr. Gerrity sold 40,000 shares of Common Stock on the open market at a
price of $1.00 per share. On December 21, 2000, Dr. Gerrity sold 36,200 shares
of Common Stock on the open market at a price of $1.00 per share.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO SECURITIES OF THE ISSUER
Except for the right to receive Common Stock upon exercise of the
Warrants, there are no contracts, arrangements, understandings or relationships
(legal or otherwise) among the Reporting Persons, the Directors or Executive
Officers, or among any of such persons and any other person, with respect to any
securities of the Issuer, including but not limited to transfer or voting of any
securities of the Issuer, finder's fees, joint ventures, loan or option
arrangements, puts or calls, guarantees of profits, division of profits or loss,
or the giving or withholding of proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
Exhibit 1 Warrants to Purchase up to 9,737,447 Shares of Common Stock of
Breakaway Solutions, Inc.
Exhibit 2 Joint Filing Agreement between ICG and ICGH.
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Signature
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After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 26, 2001 INTERNET CAPITAL GROUP, INC.
By: /s/ Henry N. Nassau
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Name: Henry N. Nassau
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Title: Managing Director,
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General Counsel and
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Secretary
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ICG HOLDINGS, INC.
By: /s/ Henry N. Nassau
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Name: Henry N. Nassau
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Title: Vice President and
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Secretary
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APPENDIX I
ICG Directors
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Name Principal Occupation Address
--------------------------------- ---------------------------------- ----------------------------------
Robert E. Keith, Jr. President and Chief Executive TL Ventures
Officer, TL Ventures The 700 Building
435 Devon Park Drive
Wayne, PA 19087
(early stage venture capital firm)
David Berkman Managing Partner, Associated Associated Group, LLC
Group LLC 3 Bala Plaza East, Suite 502
Bala Cynwyd, PA 19004
(venture capital firm)
Walter W. Buckley, III President and Chief Executive Internet Capital Group, Inc.
Officer, Internet Capital The 600 Building
Group, Inc. 435 Devon Park Drive
Wayne, PA 19087
Kenneth A. Fox Managing Director, Office of the Internet Capital Group, Inc.
President, Internet Capital The 600 Building
Group, Inc. 435 Devon Park Drive
Wayne, PA 19087
Thomas P. Gerrity Professor, Wharton School of the The Wharton School
University of Pennsylvania University of Pennsylvania
Suite 2000 Steinberg Hall -
Dietrich Hall
Philadelphia, PA 19104-6370
Warren V. Musser Chairman and CEO, Safeguard Safeguard Scientifics, Inc.
Scientifics, Inc. 800 The Safeguard Building
435 Devon Park Drive
Wayne, PA 19087
(develops and operates internet
infrastructure companies)
Peter A. Solvik Senior Vice President and Chief Cisco Systems, Inc.
Information Officer, Cisco 170 West Tasman Drive
Systems, Inc. San Jose, CA 95134-1619
(provides hardware and software
used in internet networking)
ICG Executive Officers
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Name Principal Occupation Address
--------------------------------- ---------------------------------- ----------------------------------
Walter W. Buckley, III President, Chief Executive Officer Internet Capital Group, Inc.
The 600 Building
435 Devon Park Drive
Wayne, PA 19087
Nigel Andrews Managing Director, Office of the Internet Capital Group, Inc.
President The 600 Building
435 Devon Park Drive
Wayne, PA 19087
Kenneth A. Fox Managing Director, Office of the Internet Capital Group, Inc.
President The 600 Building
435 Devon Park Drive
Wayne, PA 19087
Ronald W. Hovsepian Managing Director, Operations Internet Capital Group, Inc.
The 600 Building
435 Devon Park Drive
Wayne, PA 19087
Henry N. Nassau Managing Director, General Internet Capital Group, Inc.
Counsel and Secretary The 600 Building
435 Devon Park Drive
Wayne, PA 19087
Edward H. West Chief Financial Officer Internet Capital Group, Inc.
The 600 Building
435 Devon Park Drive
Wayne, PA 19087
ICGH Directors
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Name Principal Occupation Address
--------------------------------- ---------------------------------- ----------------------------------
Walter W. Buckley, III President, Chief Executive Officer, Internet Capital Group, Inc.
Internet Capital Group, Inc. The 600 Building
435 Devon Park Drive
Wayne, PA 19087
2
Kenneth A. Fox Managing Director, Office of the Internet Capital Group, Inc.
President, Internet Capital The 600 Building
Group, Inc. 435 Devon Park Drive
Wayne, PA 19087
Henry N. Nassau Managing Director, General Internet Capital Group, Inc.
Counsel and Secretary, Internet The 600 Building
Capital Group, Inc. 435 Devon Park Drive
Wayne, PA 19087
Edward H. West Chief Financial Officer, Internet Internet Capital Group, Inc.
Capital Group, Inc. The 600 Building
435 Devon Park Drive
Wayne, PA 19087
ICGH Executive Officers
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Name Principal Occupation Address
--------------------------------- ---------------------------------- ----------------------------------
Walter W. Buckley, III President ICG Holdings, Inc.
Pencader Corporate Center
100 Lake Drive, Suite 4
Newark, DE 19702
Kenneth A. Fox Vice President ICG Holdings, Inc.
Pencader Corporate Center
100 Lake Drive, Suite 4
Newark, DE 19702
Henry N. Nassau Vice President and Secretary ICG Holdings, Inc.
Pencader Corporate Center
100 Lake Drive, Suite 4
Newark, DE 19702
Edward H. West Chief Financial Officer and ICG Holdings, Inc.
Assistant Secretary Pencader Corporate Center
100 Lake Drive, Suite 4
Newark, DE 19702
3