EXHIBIT 3
LETTER AGREEMENT
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ICG Holdings, Inc.
000 Xxxx Xxxxx
0 Xxxxxxxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
August 29, 2001
SCP Private Equity Partners II, L.P.
Building 300
000 Xxxxx Xxxx Xxxxx
Xxxxx, XX 00000-0000
Attn: Xxxxx Xxxxxxx
Re: Breakaway Solutions, Inc.
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Gentlemen and Ladies:
By this Letter Agreement, ICG Holdings, Inc., a Delaware corporation
("ICGH"), and Internet Capital Group, Inc., a Delaware corporation ("ICGI")
hereby waive and terminate from this date forward all of the respective rights,
duties and benefits owed to or enjoyed by either of them under any and all
contracts, arrangements, understandings, relationships or other bases by and
between ICGI and/or ICGH with SCP Private Equity Partners II, L.P., a Delaware
limited partnership ("SCP"), by which (i) ICGI and/or ICGH have or share voting
power (which includes the power to vote or direct the voting of) or investment
power (which includes the power to dispose or to direct the disposition of) over
any equity security issued by Breakaway Solutions, Inc., a Delaware corporation
(the "Company"), and owned by SCP and (ii) SCP has or shares voting power (which
includes the power to vote or direct the voting of) or investment power (which
includes the power to dispose or to direct the disposition of) over any equity
security issued by the Company and owned by ICGH or ICGI. Without limitation
thereon, the parties to this Letter Agreement agree that:
(a) The Investor Voting Agreement, dated February 16, 2001, by and
among SCP and ICGH is hereby terminated.
(b) Section 3.1(d) and Section 4.1 of the Investor Rights Agreement
dated April 6, 2001, by and among the Company, SCP and ICGH (the
"Investor Rights Agreement") shall be deleted. In addition,
Section 3.1(b) of the Investor Rights Agreement shall be amended
and restated to read as follows: "(b) reserve three seats on the
Board of Directors for members selected by SCP (in separate
classes)."
(c) The second to last paragraph of the letter agreement, dated
February 16, 2001, by and between SCP and ICGH is hereby deleted.
Notwithstanding the foregoing, this Letter Agreement shall not terminate or
in any way alter, amend or waive the Indemnification Agreement by and among SCP,
ICGH, ICGI and the Company, the Series A Preferred Stock Purchase Agreement of
February 16, 2001, as amended, the Budget and Financial Management Plan entered
into in connection with it, or the rights and benefits of SCP under these or any
other document, agreement or instrument whatsoever (other than as set forth in
1,2 and 3 hereinabove), all of which shall remain in full force and effect.
Please evidence your agreement to the foregoing by signing below.
Very truly yours,
ICG HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxx, III
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Name: Xxxxxx X. Xxxxxxx, III
Title: President
INTERNET CAPITAL GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxxx, III
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Name: Xxxxxx X. Xxxxxxx, III
Title: President
ACKNOWLEDGED AND AGREED:
SCP PRIVATE EQUITY PARTNERS II, L.P.
BY: SCP PRIVATE EQUITY II GENERAL PARTNER, L.P.,
its General Partner
BY: SCP PRIVATE EQUITY II, LLC, its Manager
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Manager
ACKNOWLEDGED AND AGREED
SOLELY FOR PURPOSES OF
PROVISION 2 OF THIS LETTER:
BREAKAWAY SOLUTIONS, INC.
By: /s/ Xxxxxxx X. Flao
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Name: Xxxxxxx X. Flao
Title: Secretary
