<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported): March 31, 2000
Breakaway Solutions, Inc.
------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
Delaware
------------------------------------------------------
(State or Other Jurisdiction of Incorporation)
000-27269 04-3285165
- --------------------------------- --------------------------------------
(Commission File Number) (I.R.S. Employer Identification No.)
50 Rowes Wharf
Boston, Massachusetts 02110
- --------------------------------------- --------------------------------------
(Address of Principal Executive Offices) (Zip Code)
(617) 960-3400
--------------------------------
(Registrant's Telephone Number, Including Area Code)
---------------
(Former name or former address, if changed since last report)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On March 31, 2000, Breakaway Solutions, Inc. (the "Registrant")
completed its acquisition of Eggrock Partners, Inc. ("Eggrock") in a stock for
stock transaction. Pursuant to the terms of an Agreement and Plan of Merger,
dated as of January 26, 2000 (the "Merger Agreement"), by and among the
Registrant, Benedict Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of the Registrant ("Transitory Subsidiary"), and Eggrock, Transitory
Subsidiary was merged with and into Eggrock and, at 11:59 p.m. EST on March 31,
2000 (the "Effective Time"), Eggrock became a wholly owned subsidiary of the
Registrant (the "Merger").
The Merger occurred following the approval and adoption of the
Merger and the Merger Agreement by written consent of the stockholders of
Eggrock dated as of March 29, 2000. As a result of the Merger, each
outstanding share of Eggrock capital stock was converted into the right to
receive 0.511380142 of a share (the "Exchange Ratio") of the Registrant's
common stock. Pursuant to the terms of the Merger Agreement, no fractional
shares of the Registrant's common stock will be issued in the Merger, and
instead each Eggrock stockholder who would otherwise be entitled to receive a
fractional share of the Registrant's common stock will receive a cash
equivalent based on a market value (as calculated in accordance with the
Merger Agreement) of the Registrant's common stock of $65.56 per share. The
purchase price was based upon the parties' determination of the fair value of
Eggrock, and the terms of the Merger Agreement were determined by arms-length
negotiation among the parties.
In addition, pursuant to the Merger Agreement, each outstanding
option to purchase Eggrock common stock under Eggrock's 1999 stock option and
grant plan has been assumed by the Registrant (each, an "Assumed Option"). At
the Effective Time, each Assumed Option became an option to purchase that
number of shares of the Registrant's common stock as is equal (subject to
rounding) to the number of shares of Eggrock common stock that was subject to
such option immediately prior to the Effective Time, multiplied by the
exchange ratio.
As a result of the Merger, the former stockholders of Eggrock now
hold approximately 15% of the issued and outstanding shares of the
Registrant's common stock. Additional information relating to (i) the
stockholders of both Eggrock and the Registrant, (ii) the respective
beneficial ownership of the Registrant's common stock of certain of such
stockholders, (iii) the management, including directors and executive
officers, of the Registrant as of the Effective Time and (iv) the Merger
Agreement and the the Merger, were all previously reported in the
Registrant's Registration Statement on Form S-4 (Commission File No.
333-31194) (the "Registration Statement") and pursuant to General Instruction
B. 3 of Form 8-K are not additionally reported herein.
Eggrock is a full service consulting firm and systems integration firm
that focuses on delivering customer-centered e-business solutions to emerging
enterprises. The Registrant currently intends to continue to use the tangible
assets of Eggrock constituting plant, equipment or other physical property
substantially in the same manner in which they were used by Eggrock immediately
prior to the Merger.
The foregoing summary of the Merger and the Merger Agreement is
qualified in its entirety by reference to the Registration Statement, and the
exhibits and reports filed therewith or incorporated therein by reference.
This Current Report on Form 8-K contains forward-looking statements
which reflect the Registrant's current judgment on certain issues, including the
Registrant's use of the assets and businesses acquired by it in the Merger.
Because these statements apply to future events, they are subject to risks and
uncertainties that could cause the actual results to differ materially.
Important factors which could
-2-
<PAGE>
cause actual results to differ materially include the ability of the Registrant
to successfully integrate the businesses of Eggrock with its businesses, the
volatility of the Registrant's quarterly results and the impact of financial
charges related to the business combination of Eggrock and the Registrant, the
intense competition the Registrant faces, and the other risks described in the
Registration Statement and in the Registrant's Annual Report on Form 10-K for
the fiscal year ended December 31, 1999, on file with the Securities and
Exchange Commission, which factors are incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED
For Eggrock, the audited (A) balance sheets as of December 31,
1999, September 30, 1999 and December 31, 1998, (B) statements of operations for
the year ended December 31, 1998, the nine months ended September 30, 1999 and
the three months ended December 31, 1999 (C) statements of redeemable
convertible preferred stock and members'/stockholders' equity (deficit) for the
year ended December 31, 1998, the nine months ended September 30, 1999 and the
three months ended December 31, 1999, (D) statements of cash flows for the year
ended December 31, 1998 and for the nine months ended September 30, 1999 and the
three months ended December 31, 1999, and (E) the notes to such financial
statements were all previously reported in the Registration Statement and
pursuant to General Instruction B. 3 of Form 8-K are not additionally reported
herein.
(b) PRO FORMA FINANCIAL INFORMATION
An unaudited pro forma consolidated balance sheet as of
December 31, 1999 and an unaudited pro forma consolidated statement of
operations for the year ended December 31, 1999 and the notes relating to the
unaudited pro forma financial statements thereto, were previously reported in
the Registration Statement and pursuant to General Instruction B. 3 of Form 8-K
are not additionally reported herein.
(c) EXHIBITS
The Exhibits filed as part of this Current Report on Form 8-K
are listed on the Exhibit Index immediately preceding such Exhibits, which
Exhibit Index is incorporated herein by reference. Documents listed on such
Exhibit Index, except for documents identified by footnotes, are being filed as
exhibits herewith. Documents identified by footnotes are not being filed
herewith and, pursuant to Rule 12b-32 under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), reference is made to such documents as
previously filed as exhibits filed with the Securities and Exchange Commission.
The Registrant's file number under the Exchange Act is 000-27269.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
BREAKAWAY SOLUTIONS, INC.
Date: April 14, 2000 By: /s/ Gordon Brooks
-------------------------------
Gordon Brooks
President and Chief Executive
Officer
-4-
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
2.1 (1) Agreement and Plan of Merger, dated as of January 26, 2000,
by and among the Registrant, Benedict Acquisition Corp. and
Eggrock Partners, Inc.
4.1 (2) Specimen certificate for shares of the Registrant's common
stock.
10.1 (1) Stockholder Agreement, dated January 26, 2000, by and among the
Registrant, Benedict Acquisition Corp. and certain stockholders
of Eggrock named therein.
10.2 (1) Form of Registration Rights Agreement.
10.3 (1) Form of Escrow Agreement.
- ------------------------
(1) Incorporated herein by reference to the Registrant's Registration
Statement on Form S-4 (Commission File No. 333-31194).
(2) Incorporated herein by reference to the Registrant's Registration
Statement on Form S-1 (Commission File No. 333-83343).
-5-
