BREAKAWAY SOLUTIONS INC
EX-10.3
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>4
<FILENAME>a2029890zex-10_3.txt
<DESCRIPTION>EX-10.3
<TEXT>

<PAGE>


                                                                    Exhibit 10.3

                                LICENSE AGREEMENT

      THIS LICENSE AGREEMENT (this "Agreement") is made and entered into as of
October 24, 2000 by and between Breakaway Solutions, Inc., a corporation
organized under the laws of the State of Delaware, United States of America
("Licensor"), and Breakaway Solutions Asia Pacific Limited, a company organized
under the laws of Bermuda ("Licensee").

                                    RECITALS

      A. Licensor owns, develops, markets and maintains certain proprietary
software, technology, trademarks and other materials for use in providing
strategy consulting, systems integration and application hosting services to
organizations using the Internet.

      B. Licensor desires to enable Licensee to use the Licensed Property (as
defined below) to provide services to customers in Japan.

      C. To this end, on the terms and subject to the conditions hereafter set
forth, Licensee desires to obtain from Licensor, and Licensor is willing to
grant to Licensee, the rights and licenses described below.

      NOW THEREFORE, in consideration of the mutual covenants contained herein,
and for other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:

      1. Certain Definitions. Any capitalized terms used but not defined in this
Agreement shall have the meaning set forth in the Shareholders Agreement between
Licensor and ICG AsiaWorks Limited dated October 24, 2000 (the "Shareholders
Agreement"). As used in this Agreement, the following terms have the meanings
set forth below:

            "Affiliate" shall mean, as to any Person, any other Person that,
directly or indirectly, controls, is under common control with, or is controlled
by, that Person. For purposes of this definition, "control" (including, with its
correlative meanings, the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities,
by contract or otherwise.

            "Documentation" shall mean Licensor's printed and electronic
documentation, manuals, specifications and instructions relating to the
operation of the Licensed Software

            "Effective Date" shall mean the date of this Agreement as set forth
in the preamble hereof.

            "Intellectual Property" shall mean and include (A) patents, patent
disclosures and all related continuation, continuation-in-part, divisional,
reissue, re-examination, utility model, certificate of invention and design
patents, patent applications, registrations and applications for

<PAGE>

registrations, (B) trademarks, service marks, trade dress, logos, trade names,
domain names and corporate names and registrations and applications for
registration thereof, (C) copyrights and registrations and applications for
registration thereof, and moral and personality rights, (D) trade secrets and
confidential business information, whether patentable or nonpatentable and
whether or not reduced to practice, know-how, manufacturing and product
processes and techniques and research and development information, (E) all other
intangible, industrial and intellectual property rights, by whatever name known,
(F) other proprietary rights relating to any of the foregoing (including without
limitation remedies against infringements thereof and rights of protection of
interest therein under the laws of all jurisdictions), (G) copies and tangible
embodiments thereof and (H) all goodwill in the foregoing.

            "Licensed Know-how" shall mean any existing and future proprietary
techniques, processes, business and other methodologies, technical information
and other trade secrets or know-how that Licensor presently or in the future
owns, controls or has the ability to license to Licensee.

            "Licensed Marks" shall mean the logos and trademarks listed on
Exhibit A attached hereto, as amended from time to time.

            "Licensed Property" shall mean the Documentation, Marketing
Materials, Licensed Software, Licensed Know-how and Licensed Marks.

            "Licensed Software" shall mean that computer software listed on
Exhibit B hereto, together with all Updates and successor versions thereto, if
any.

            "Localized Version" shall have the meaning set forth in Section
2.1(a).

            "Marketing Materials" shall mean brochures, advertising copy and
similar materials with respect to marketing the business of the Licensor.

            "Object Code" shall mean (i) machine executable programming
instructions, substantially in binary form, which are intended to be directly
executable by an operating system after suitable processing and linking but
without the intervening steps of compilation or assembly, or (ii) other
executable code (e.g., programming instructions written in procedural or
interpretive languages).

            "Person" shall mean a natural person, sole proprietorship,
corporation, general partnership, limited partnership, limited liability
partnership, limited liability company, joint venture, unincorporated
organization, joint stock company, trust, estate, governmental entity or other
entity.

            "Services Agreement" shall mean that agreement, in the form attached
hereto as Exhibit C, pursuant to which the Licensor has agreed to maintain,
update and, at the request of the Licensee, enhance the Licensed Software and
Licensee has agreed to pay for certain services.

            "Source Code" shall mean the human-readable form of any computer
programming code, including without limitation all comments, procedural code and
scripts.


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            "Territory" shall mean Asia (excluding Japan), including, without
limitation, Australia and India.

            "Territory Customer" means a customer of the Licensee that has its
corporate headquarters or principal business operations in the Territory or, if
a multi-national Person, has a significant division or business unit in the
Territory (but only such division or business unit shall be deemed to constitute
the Territory Customer).

            "Third Party Software" shall mean software, if any, that is
incorporated into or bundled with the Licensed Software which is not owned by
Licensor.

            "Update" means any correction, bug fix, enhancement, upgrade or
modification to the Licensed Software.

      2. Licenses.

            2.1 Software, Documentation and Know-how Licenses. On the terms and
subject to the conditions of this Agreement, Licensor hereby grants to Licensee,
a perpetual (subject to termination as provided in Section 8.1 and Section 8.2),
exclusive in the Territory (as set forth in Section 2.2), non-transferable
(except as provided herein), royalty-free, right and license under all of
Licensor's Intellectual Property rights:

                  (a) to use and modify the Documentation and the Licensed
Software (in Source Code and Object Code form) for the sole purpose of adapting
the Licensed Software and Documentation for use in the Territory, including
translation to local languages, addition of local character sets, graphics and
data sources ("Localizing" or "Localization", and the resulting versions of the
Licensed Software and Documentation, the "Localized Versions");

                  (b) to reproduce, distribute, perform (publicly or otherwise)
and market the Licensed Software, Documentation and Localized Versions within
the Territory to Territory Customers in Object Code form solely for the business
purposes of such Territory Customers with no right to further distribute or
sublicense;

                  (c) to grant Territory Customers sublicenses to use and
operate the Software, Documentation and Localized Versions in Object Code form
to support their business operations in the Territory;

                  (d) to use and operate the Software, Documentation and
Localized Versions on behalf of Territory Customers, on an application service
provider basis, to support their business operations in the Territory;

                  (e) to make, use, modify (including, but not limited to,
Localizing), reproduce, distribute, perform (publicly or otherwise) market,
sell, offer for sale, import and sublicense to Territory Customers the Licensed
Know-how (and products and services incorporating the Licensed Know-how) in the
course of conducting the Business;

                  (f) to use, modify (including, but not limited to,
Localizing), repro-


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duce, distribute, perform (publicly or otherwise) and display the Marketing
Materials in the Territory; and

                  (g) to grant sublicenses to third party contractors under the
rights and licenses granted under Sections 2.1(a) - 2.1(f) solely in connection
with Licensor's exercise of such rights and licenses.

            2.2 Exclusivity and Territoriality.

                  (a) Licensor will not, (i) directly or indirectly, provide or
license the Licensed Software, Documentation or Licensed Know-how to any
Territory Customer other than Licensee for use anywhere in the Territory or (ii)
directly or indirectly develop or allow any third party to develop versions of
the Licensed Software, Documentation and/or Licensed Know-how that are Localized
for use anywhere in the Territory.

                  (b) Notwithstanding anything to the contrary set forth herein,
Licensee shall have the right to exercise the rights and licenses granted under
Sections 2.1(a) - 2.1(f) outside the Territory and with respect to customers
other than Territory Customers in the event that Licensee obtains the right to
pursue an opportunity outside the Territory pursuant to Section 5.2(b) of the
Shareholders Agreement.

            2.3 Third Party Software. Licensee acknowledges that certain Third
Party Software may be incorporated into or necessary for the use of the Licensed
Software. LICENSOR MAKES NO WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, ORAL OR
WRITTEN, TO LICENSEE OR ANY OTHER PARTY WITH RESPECT TO THIRD PARTY SOFTWARE,
AND HEREBY DISCLAIMS ANY AND ALL SUCH WARRANTIES. To the extent Licensor is able
to sublicense any such Third Party Software to Licensee without incurring any
additional royalties or license fees, such Third Party Software shall be deemed
included in the Licensed Software for the purposes of Section 2.1 (together with
any associated Documentation). To the extent Licensor is unable to sublicense to
Licensee any such Third Party Software without incurring additional royalties or
licensee fees, such Third Party Software shall not be included in the Licensed
Software hereunder, and Licensee shall be responsible, at its own expense, for
obtaining sufficient rights to use such Third Party Software from the relevant
vendors; provided, however, that Licensor shall provide Licensee with reasonable
assistance in obtaining all necessary rights to any such Third Party Software.

            2.4 Proprietary Markings. Licensee shall not remove any production
identification, copyright notices or proprietary indications from the Licensed
Properties.

            2.5 Trademark License.

                  (a) Licensor hereby grants to Licensee, subject to termination
as provided herein, an exclusive (subject to the following sentence),
non-transferable (except as provided herein), right and license (i) to use and
display the Licensed Marks in the Territory solely in connection with the
conduct of the Business and (ii) to register in the Territory one or more
Internet domain names using the Licensed Marks. The exclusivity of this license
shall not prevent Licensor from undertaking global marketing campaigns using the
Licensed Marks that result


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in promotional materials and information being accessible or distributed into
the Territory, provided that such campaigns are not directed principally at
Territory Customers or other Persons in the Territory.

                  (b) Licensee acknowledges that the quality of the products and
services offered by Licensee under the Licensed Marks will reflect on Licensor,
and will affect the reputation and goodwill of Licensor in the Territory and
elsewhere. Licensee agrees that the quality of the products and services that it
distributes and offers under the Licensed Marks shall be of a level at least
comparable to the quality of the products and services distributed and offered
by Licensor outside of the Territory. In the event that the quality of the
products and services offered by Licensee under the Licensed Marks are not at
such level, then Licensor shall have the right, upon 30 days' prior written
notice to Licensee, to terminate the licenses granted under this Section 2.5, if
by the end of such 30 day period Licensee has not improved the quality of the
relevant products or services, or presented Licensor with a corrective plan that
is acceptable to Licensor in Licensor's reasonable discretion.

                  (c) Licensee agrees that it shall not register any Licensed
Mark, or any name, logo, trade name, domain name, trademark or design that is
confusingly similar thereto, in any jurisdiction, inside or outside the
Territory, except as expressly permitted in this Section 2.5(c), in Section
2.5(a)(ii) above or with the prior written consent of Licensor. Licensee shall
timely make all registrations and filings, execute all documents required under
applicable law and take such other actions as are reasonably necessary to
protect the Licensed Marks in the Territory. Licensee shall have the right to
require Licensor diligently to pursue trademark registrations with regard to the
Licensed Marks in the Territory. In the event that Licensor fails to file,
prosecute or maintain any trademark application (or ensuing trademark
registrations) with respect to the Licensed Marks in the Territory as requested
by Licensee within a reasonable period of time following such request, Licensee
shall have the right, at Licensor's reasonable expense, to prosecute and
maintain such trademark applications (or ensuing trademark registrations) on
behalf of Licensor.

                  (d) Licensee shall provide to Licensor, as represented by the
individual designated by the Licensor as its corporate marketing representative
on the Advisory Committee (as defined in the Shareholder's Agreement), a copy of
any tangible promotional materials, advertising or packaging that will bear the
Licensed Marks for review and pre-approval, which approval shall not be
unreasonably withheld. Any failure of Licensor to indicate its approval or
disapproval of any such promotional materials within fifteen (15) days after its
receipt of such copy shall be deemed acceptance thereof. With respect to
promotional materials bearing the Licensed Marks made available in electronic
form via publicly accessible portions of the Internet, Licensor shall have the
right to review and approve such materials via such publicly accessible portions
of the Internet. In the event that Licensor disapproves of any of Licensee's
promotional materials bearing the Licensed Marks (whether in tangible or
electronic form), it shall provide Licensee with written notice setting forth
the grounds for its disapproval in reasonable detail, and Licensee cease using
such promotional materials until the promotional materials have been modified to
address the grounds for disapproval set forth in such written notice.

            2.6 Licensee Developments. Licensee shall deliver to Licensor all
modifica-


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tions, corrections and enhancements that it makes to the Licensed Software
except for the Localized Versions ( "Licensee Developments"), in Source Code and
Object Code forms, promptly upon their development, together with all relevant
programmers' notes, documentation and commenting associated therewith. Licensor
shall reimburse Licensee for all reasonable out-of-pocket expenses incurred in
connection with the delivery to Licensor of the Licensee Developments. Licensee
hereby grants to Licensor a perpetual, irrevocable, non-exclusive, royalty-free
right and license, including the right to sublicense, to use, copy, modify,
distribute, market, promote and create derivative works of any and all such
Licensee Developments in Source Code and Object Code forms outside the
Territory.

            2.7 No Other Rights. Except as provided in this Article 2, nothing
in this Agreement shall be deemed to grant any license or rights in any
technology, products or services to Licensee except for the licenses and rights
specifically granted herein with respect to the Licensed Properties.

      3. Delivery and Maintenance of Licensed Software.

            3.1 Delivery. As soon as practicable after the Effective Date,
Licensor shall deliver to Licensee the Licensed Software, Marketing Materials,
Documentation and other materials embodying the Licensed Know-How in their then
most current forms and representations (including, without limitation, graphics
files and camera-ready mechanicals) of the Licensed Marks. Thereafter, Licensor
shall deliver to Licensee any Updates or other modifications, improvements or
additions to the Licensed Software, Documentation, Licensed Know-how, Licensed
Marks or Marketing Materials ("New Materials") as soon as practicable after the
development of such New Materials, and in any event no later than such New
Materials are made available to any other licensee of Licensor or are generally
distributed internally by the Licensor.

            3.2 Support.

                  (a) Licensor represents and warrants that it uses a variety of
methods to disseminate the Licensed Software, Documentation Licensed Know-How
and information with respect thereto to its employees, to educate its employees
with respect to such technology and to inform and educate its employees with
respect to new developments. These methods include distributions of technical
information by e-mail and other methods, training meetings, technical
roundtables, conference calls, access to the Licensor's intranet, including
meetings of technical personnel and the like. Licensor hereby agrees to include
all appropriately situated personnel of the Licensee in any dissemination of
such information, to give all such personnel substantially the same access to
the relevant portions of Licensor's intranet as is given to similarly situated
personnel of Licensor and to invite all such personnel to such meetings,
conference calls, training sessions and similar events as similarly situated
personnel of the Licensor attend. All costs and expenses of Licensee's employees
in participating in training and other meetings shall be the responsibility of
Licensee.

                  (b) Licensor hereby agrees to continue to develop, improve and
enhance (i) the Licensed Software, Documentation and Licensed Know-how as
reasonably necessary or useful in connection with Licensor's conduct of its own
business, and (ii) the methodolo-


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gies, procedures and policies by which Licensor documents the functionality and
specifications of the Licensed Software and by which it disseminates information
with respect thereto, including, without limitation, the methodologies,
procedures and policies described in Section 3.2(a).

      4. Rights in Intellectual Property.

            4.1 Reservation of Rights. Except as otherwise expressly set forth
in this Agreement, no right, title or interest in or to the Licensed Property,
or in or to any Intellectual Property rights therein, shall be conveyed to
Licensee under this Agreement; and Licensor or its suppliers shall own all such
Intellectual Property in the Licensed Property. Upon request, Licensee shall
execute and deliver all such instruments and documents, including without
limitation documents of assignment, and take all such steps and render all such
assistance as may be reasonably necessary to assure to Licensor its rights under
this Section 4.1.

            4.2 Licensee Developments. Subject to Licensor's ownership of the
Licensed Property, Licensee shall, except as expressly set forth herein, own all
right title and interest in and to the Licensee Developments, including any
Localized Versions, including all Intellectual Property rights therein or
thereto. Upon request, Licensor shall execute and deliver all such instruments
and documents, including without limitation documents of assignment, and take
all such steps and render all such assistance as may be reasonably necessary to
assure to Licensee its rights under this Section 4.2.

            4.3 Benefit. All use of the Licensed Property shall inure to the
benefit of Licensor, or, as applicable, its suppliers. All use of the Licensee
Developments shall inure to the benefit of Licensee.

      5. Representations and Warranties; Indemnification.

            5.1 Licensor Representations and Warranties.

                  (a) Corporate Authority. Licensor represents and warrants to
Licensee that Licensor has full power, right and authority to enter into this
Agreement, to carry out its obligations under this Agreement, and to grant the
rights granted to Licensee herein, and that this Agreement is valid, binding and
enforceable against it.

                  (b) No Conflict. Licensor represents and warrants that the
execution of this Agreement, the granting of the rights and licenses to Licensee
herein, and the performance of its obligations hereunder does not and will not
(i) violate the Articles of Incorporation or by-laws of Licensor or any
provision of any applicable law; or (ii) conflict with or violate any other
agreement to which Licensor is a party.

                  (c) Rights; Non-Infringement. Licensor represents and warrants
that it is the sole owner of all right, title and interest in and to the
Licensed Property and/or possesses all rights necessary to grant the licenses
granted to Licensee herein, and that the use and sale of the Licensed Property,
and of products and services incorporating the Licensed Property in accordance
with the terms of this Agreement do not and will not infringe or misappropriate
any Intellectual Property rights of any third party.


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<PAGE>

                  (d) No Claims. Licensor represents and warrants that (i) no
claims have been made with respect to the Licensed Property and no demands of
any third Party have been made pertaining to the Licensed Property, and (ii) no
proceedings have been instituted or are pending or threatened that challenge the
rights of Licensor in respect thereof.

            5.2 Licensee Representations and Warranties.

                  (a) Corporate Authority. Licensee represents and warrants to
Licensor that Licensee has full power, right and authority to enter into this
Agreement, to carry out its obligations under this Agreement, and to grant the
rights granted to Licensor herein, and that this Agreement is valid, binding and
enforceable against it.

                  (b) No Conflict. Licensee represents and warrants that the
execution of this Agreement, the granting of the rights and licenses to Licensor
herein, and the performance of its obligations hereunder does not and will not
(i) violate the Articles of Incorporation or by-laws of Licensee or any
provision of any applicable law; or (ii) conflict with or violate any other
agreement to which Licensee is a party.

            5.3 Indemnification by Licensor.

                  (a) Indemnification. Licensor will defend any claims or suits
brought against Licensee or any of its Affiliates ("Licensee Claims"), and will
indemnify and hold Licensee and its Affiliates harmless against any liability
cost or expense (including reasonable attorneys fees) resulting from any claim,
action, suit or allegation made or brought by any Person (other than Licensee or
a Licensee Affiliate) (i) arising from Licensor's or its sublicensees' use or
modification of the Licensee Developments except as permitted hereunder, (ii)
arising from any breach or alleged breach by Licensor of any of the
representations or warranties made by Licensor in Section 5.1, or (iii) arising
from the violation by Licensor of any law, rule, regulation or order in any
jurisdiction. Licensor shall give Licensor prompt written notice of any Licensor
Claim. In addition, if any Licensed Property provided to Licensee by Licensor is
held to infringe any Intellectual Property right of a third party in the
Territory, Licensor will, at its own expense, and in its sole discretion, (a)
procure for Licensee the right to continue to use the allegedly infringing
Licensed Property or (b) replace or modify the Licensed Property to make it
non-infringing so long as the replacement to or modification of Licensed
Software provide substantially the same functional, performance and operational
features as the infringing software which is being replaced or modified.

                  (b) Procedures. Licensor shall have sole control over the
defense of any Licensee Claim, including appeals, negotiations and the right to
effect a settlement or compromise thereof, provided that (i) Licensor may not
partially settle any Licensor Claim without the written consent of Licensor,
unless such settlement releases Licensor fully from such claim, (ii) Licensor
shall promptly provide Licensor with copies of all pleadings or similar document
relating to any Licensee Claim, (iii) Licensor shall consult with Licensee with
respect to the defense and settlement of any Licensee Claim, and (iv) in any
litigation to which Licensee is a party, Licensee shall be entitled to be
separately represented at its own expense by counsel of its own selection,
subject to the right of the Licensor to control the defense.


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<PAGE>

            5.4 Indemnification by Licensee.

                  (a) Indemnification. Licensee will defend any claims or suits
brought against Licensor or any of its Affiliates ("Licensor Claims"), and will
indemnify and hold Licensor and its Affiliates harmless against any liability
cost or expense (including reasonable attorneys fees) resulting from any claim,
action, suit or allegation made or brought by any Person (other than Licensor or
a Licensor Affiliate) (i) arising from Licensee's or its sublicensees' use or
modification of the Licensed Property except as permitted hereunder, (ii)
arising from any breach or alleged breach by Licensee of any of the
representations or warranties made by Licensee in Section 5.2, or (iii) arising
from the violation by Licensee of any law, rule, regulation or order in any
jurisdiction. Licensor shall give Licensor prompt written notice of any Licensor
Claim.

                  (b) Procedures. Licensee shall have sole control over the
defense of any Licensor Claim, including appeals, negotiations and the right to
effect a settlement or compromise thereof, provided that (i) Licensee may not
partially settle any Licensor Claim without the written consent of Licensor,
unless such settlement releases Licensor fully from such claim, (ii) Licensee
shall promptly provide Licensor with copies of all pleadings or similar document
relating to any Licensor Claim, (iii) Licensee shall consult with Licensor with
respect to the defense and settlement of any Licensor Claim, and (iv) in any
litigation to which Licensor is a party, Licensor shall be entitled to be
separately represented at its own expense by counsel of its own selection,
subject to the right of Licensee to control the defense.

      6. Limitation of Damages and Disclaimer of Warranties.

            6.1 Limit on Aggregate Damages.

                  (a) IN NO EVENT SHALL LICENSOR'S AGGREGATE LIABILITY TO
LICENSEE, OR LICENSEE'S AGGREGATE LIABILITY TO LICENSOR, UNDER THIS AGREEMENT,
FOR ANY AND ALL CAUSES, EXCEED $650,000.

                  (b) IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER
PARTY FOR ANY DAMAGES RESULTING FROM LOSS OF DATA, LOST PROFITS, LOSS OF USE OF
EQUIPMENT, LOST CONTRACTS OR FOR ANY SPECIAL, INDIRECT, INCIDENTAL, PUNITIVE,
EXEMPLARY OR CONSEQUENTIAL DAMAGES IN ANY WAY ARISING OUT OF OR IN CONNECTION
WITH THE USE OR PERFORMANCE OF THE LICENSED PROPERTY, LICENSEE DEVELOPMENTS OR
RELATING TO THIS AGREEMENT, HOWEVER CAUSED, EVEN IF SUCH PARTY HAS BEEN MADE
AWARE OF THE POSSIBILITY OF SUCH DAMAGES TO THE OTHER PARTY.

            6.2 Warranty Disclaimers. EXCEPT AS EXPRESSLY SET FORTH HEREIN, THE
LICENSED PROPERTY IS PROVIDED TO LICENSEE, AND THE LICENSEE DEVELOPMENTS ARE
PROVIDED TO LICENSOR, AS-IS. EXCEPT AS EXPRESSLY SET FORTH HEREIN, LICENSOR
MAKES NO WARRANTIES TO LICENSEE OR TO ANY OTHER PARTY OF ANY KIND WHATSOEVER
WITH RESPECT TO THE LICENSED PROPERTY, WRITTEN OR ORAL, EXPRESS, IMPLIED OR


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            STATUTORY, INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE, ALL OF WHICH
WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED. EXCEPT AS EXPRESSLY SET FORTH
HEREIN, LICENSEE MAKES NO WARRANTIES TO LICENSOR OR TO ANY OTHER PARTY OF ANY
KIND WHATSOEVER WITH RESPECT TO THE LICENSEE DEVELOPMENTS, WRITTEN OR ORAL,
EXPRESS, IMPLIED OR STATUTORY, INCLUDING, BUT NOT LIMITED TO, ANY IMPLIED
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR USE OR PURPOSE, ALL OF
WHICH WARRANTIES ARE HEREBY EXPRESSLY DISCLAIMED.

            LICENSOR DOES NOT WARRANT THAT THE LICENSED SOFTWARE WILL MEET
LICENSEE'S OR ANY OTHER PARTY'S REQUIREMENTS, WILL OPERATE IN COMBINATIONS
LICENSEE OR ANY OTHER PARTY MAY SELECT FOR USE, OR THAT OPERATION OF THE
LICENSED SOFTWARE WILL BE UNINTERRUPTED OR ERROR FREE. LICNSEE DOES NOT WARRANT
THAT THE LICENSEE DEVELOPMENTS WILL MEET LICENSOR'S OR ANY OTHER PARTY'S
REQUIREMENTS, WILL OPERATE IN COMBINATIONS LICENSOR OR ANY OTHER PARTY MAY
SELECT FOR USE, OR THAT OPERATION OF THE LICENSEE DEVELOPMENTS WILL BE
UNINTERRUPTED OR ERROR FREE.

      7. Confidentiality.

            7.1 Obligations. For so long as this Agreement remains in effect and
for a period of ten (10) years after any expiration or termination of this
Agreement, each party shall keep strictly confidential, and shall not disclose,
any confidential or proprietary information of the other party received under or
in connection with this Agreement, including without limitation any information,
written or oral, relating to customers, costs, profits, markets, sales,
products, product development, key personnel, pricing policies, operational
methods, technology, know-how, technical processes, formulae or plans for future
development ("Confidential Information"); provided, however, that Confidential
Information shall not include, and the disclosure restrictions of this Section 7
shall not apply to, any information received by either party from the other
which:

                  (a) was already known to the recipient at the time of receipt;

                  (b) was at the time of receipt, or thereafter becomes, freely
and generally available to the public through no wrongful act of the recipient;

                  (c) is rightfully received by the recipient from a third party
legally entitled to disclose such information free of confidentiality
restrictions;

                  (d) is independently developed by the recipient with reference
to any Confidential Information of the disclosing party;

                  (e) is disclosed by the recipient pursuant to the order of any
court or in connection with any legal proceeding commenced by or against the
recipient, provided that prior


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to any such disclosure the recipient shall give the other party a reasonable
opportunity to seek a protective order with respect to any such disclosure; or

                  (f) is disclosed by the recipient, or any Affiliate of the
recipient, as required under any applicable securities laws

                  Upon the expiration or termination of this Agreement, each
party shall either erase, destroy or return to the other party all program
listings, memoranda, notes, records, reports and other documents (whether in
tangible or electronic form, and including all copies thereof) containing any
Confidential Information of such other party and in such other party's
possession or under its control at the time of such expiration or termination,
and shall give written certification of compliance with this paragraph to such
other party.

            7.2 Injunctive Relief. Because the unauthorized disclosure or
transfer of Confidential Information by recipient will substantially diminish
its value and irrevocably harm the disclosing party, if recipient materially
breaches the provisions of Section 7.1, the disclosing party shall be entitled
to injunctive and/or other equitable relief, in addition to other remedies
afforded by law.

      8. Term and Termination.

            8.1 Term. Unless earlier terminated as provided herein, this
Agreement shall be effective during the period from the Effective Date until the
sooner of: (i) the date on which the parties hereto mutually agree to terminate
this Agreement; or (ii) the date on which this Agreement is terminated under
Sections 8.2 and 8.3 below.

            8.2 Termination. Subject to the provisions of Section 8.3 below, a
party may terminate this Agreement (i) in the event of any material breach of
any warranty, representation or covenant of this Agreement by the other party
which remains uncured sixty (60) days after written notice of such breach, upon
written notice to the other party given no later than five (5) days following
the expiration of such sixty (60) day period; (ii) in the event that any
involuntary bankruptcy, insolvency, receivership, dissolution, or similar
proceeding is instituted against the other party and has not been dismissed
within thirty (30) days after filing, upon written notice to the other party
given no later than five (5) days following the expiration of such thirty (30)
day period; or (iii) in the event that any voluntary bankruptcy, insolvency,
receivership, dissolution, liquidation, or similar proceeding is commenced by
the other party, immediately upon written notice to the other party.

            8.3 Effect of Termination.

                  (a) Termination by Licensor. In the event that Licensor
terminates this Agreement in accordance with Section 8.2:

                        (i) Licensee shall have a transition period of three (3)
months from the effective date of such termination (the "Licensor Termination
Date") in which to transition away from all uses of the Licensed Marks. During
such transition period, Licensee shall use all reasonable efforts to wind down
its use of the Licensed Marks as soon as reasonably practica-


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<PAGE>

ble and, in any event, all of the rights and licenses under the Licensed Marks
granted pursuant to Section 2.5 shall terminate in three (3) full months after
the Licensor Termination Date.

                        (ii) With respect to Licensed Property other than the
Licensed Marks, Licensee shall (A) in the case of projects for which contracts
are signed at any time after the Termination Date, make no use of such Licensed
Property and (B) in the case of projects for which contracts were signed prior
to the Termination Date, use commercially reasonable efforts to transition away
from the use of such Licensed Property during the twelve (12) month period
following the Termination Date. Except as Licensor may expressly agree in
writing, Licensee shall make no use of the Licensed Property, including with
respect to projects which commenced prior to the Termination Date, after twelve
(12) months have elapsed from the Termination Date and all of the rights and
licenses under the Licensed Property other than the Licensed Marks shall
thereupon terminate in full.

                  (b) Termination by Licensee. In the event that Licensee
terminates this Agreement in accordance with Section 8.2:

                        (i) Licensee shall have a transition period of three (3)
months from the effective date of such termination (the "Licensee Termination
Date") in which to transition away from all uses of the Licensed Marks. During
such transition period, Licensee's rights to use and display the Licensed Marks
in the Territory shall remain exclusive as set forth in Section 2.5, but
Licensee shall use all reasonable efforts to wind down its use of the Licensed
Marks as soon as reasonably practicable and, in any event, all of the rights and
licenses under the Licensed Marks granted pursuant to Section 2.5 shall
terminate in full six (6) months after the Licensee Termination Date. For the
sake of clarity, Licensor shall be free during such transition period to conduct
business in the Territory under any brand names, trade names or trademarks other
than the Licensed Marks and using any of the Licensed Property other than the
Licensed Marks.

                        (ii) Licensee shall have a transition period of
twenty-four (24) months in which to transition away from its use of the Licensed
Property other than the Licensed Marks. During such transition period, Licensee
shall use all reasonable efforts to wind down its use of the Licensed Property
other than the Licensed Marks as soon as reasonably practicable and, in any
event, all of the rights and licenses under the Licensed Property other than the
Licensed Marks granted pursuant to Section 2.1 shall terminate in full
twenty-four (24) months after the Licensee Termination Date.

                  (c) Return/Destruction of Materials.

                        (i) At the end of any three (3) or six (6) month
transition period under Section 8.3(a)(i) or Section 8.3(b)(i), respectively,
Licensee shall (A) in Licensee's discretion, either return to Licensor or
destroy all materials embodying the Licensed Marks and certify to Licensor in
writing that Licensee has complied with the requirements of this Section
8.3(c)(i) and (B) use commercially reasonable efforts to transfer and assign to
Licensor, without charge, all Internet domain names and URL's owned by Licensee
and containing any Licensed Mark. In the event that any applicable law,
regulation or registration procedure prevents the di-


                                       12
<PAGE>

rect transfer and assignment of any such domain name to Licensor, Licensee and
Licensor shall cooperate in good faith to take steps designed to ultimately vest
ownership or control of such domain names in Licensor.

                        (ii) Except as otherwise agreed in writing by Licensor,
at the end of any twelve (12) month or twenty-four (24) month period under
Section 8.3(a)(ii) or 8.3(b)(ii), respectively, Licensee shall, in Licensee's
discretion, either return to Licensor or destroy all materials embodying the
Licensed Property other than the Licensed Marks and certify to Licensor in
writing that Licensee has complied with the requirements of this Section
8.3(c)(ii).

            8.4 Survival. The provisions of Sections 4, 5, 6, 7, 8.3, 8.4, and
9.7 shall survive any expiration or termination of this Agreement in accordance
with their terms and the licenses granted pursuant to Sections 2.1, 2.2 and 2.5
shall survive to the extent provided in Section 8.3.

      9. Miscellaneous.

            9.1 Costs. Except as may be otherwise expressly provided in this
Agreement, each party shall bear its own costs and expenses in carrying out its
obligations under this Agreement.

            9.2 Notices. Any notice, request, demand, approval or consent
required or permitted under this Agreement shall be in writing and shall be
effective upon actual receipt when delivered by (a) registered mail, postage
prepaid, return receipt requested; (b) personal delivery; (c) an overnight
courier of recognized reputation (such as DHL or Federal Express) or (d)
transmission by facsimile (with confirmation by mail), in each case addressed as
follows:

            If to Licensor:   Breakaway Solutions, Inc.
                              50 Rowes Wharf
                              Boston, Massachusetts 02110
                              Attention:  Mr. Timothy Perkins
                              Telephone:  617-960-3400
                              Telecopy:  617-960-3434
                              e-mail:  tperkins@breakaway.com

                              After November 15, 2000:

                              World Trade Center East
                              Two Seaport Lane
                              Boston, Massachusetts 02210

            If to Licensee:   Breakaway Solutions Asia Pacific Limited
                              The Center 67/F
                              99 Queen's Road Central
                              Hong Kong


                                       13
<PAGE>

                              Attention:  Mr. William Hay/Tiak Koon Loh
                              Telephone:  852 2186 3018
                              Facsimile:  852 2186 3058
                              email:  tloh@internetcapital.com

Either party may change its address or facsimile number for notice purposes by
notice given to the other party in accordance with this Section 9.2.

            9.3 Assignment. Except as expressly provided herein, neither party
shall assign or transfer this Agreement or any interest herein, or enter into
any agreement of merger, sale of control or sale of substantially all of its
assets, effectively transferring this Agreement to another party, without the
prior written consent of the other party.

            9.4 Entire Agreement. This Agreement, including the exhibits
referred to herein, which are hereby incorporated in and made a part of this
Agreement, constitutes the entire contract between the parties with respect to
the subject matter covered by this Agreement. This Agreement supersedes all
previous letters of intent, agreements and understandings, if any, by and
between the parties with respect to the subject matter covered by this
Agreement. This Agreement may not be amended, changed or modified except by a
writing duly executed by the parties hereto.

            9.5 Severability. If any provision of this Agreement is held by a
court of competent jurisdiction to be unenforceable, invalid or void in any
respect, no other provision of this Agreement shall be affected thereby, and all
other provisions of this Agreement shall nevertheless be carried into effect and
the parties shall amend this Agreement to modify the unenforceable, invalid or
void provision to give effect to the intentions of the parties to the extent
possible in a manner which is valid and enforceable. IT IS EXPRESSLY UNDERSTOOD
AND AGREED THAT EACH AND EVERY PROVISION OF THIS AGREEMENT WHICH PROVIDES FOR A
LIMITATION OF LIABILITY, DISCLAIMER OF WARRANTIES OR EXCLUSION OF DAMAGES, IS
INTENDED BY THE PARTIES TO BE SEVERABLE AND INDEPENDENT OF ANY OTHER PROVISION
AND TO BE ENFORCED AS SUCH.

            9.6 Remedies and Waivers. All rights and remedies of the parties
under this Agreement and the Services Agreement are separate and cumulative, and
no one of them, whether exercised or not, shall be deemed to be to the exclusion
of or to limit or prejudice any other rights or remedies which the parties may
have. The parties shall not be deemed to waive any of their rights or remedies
under this Agreement or the Services Agreement, unless such waiver is in writing
and signed by the party to be bound. No delay or omission on the part of either
party in exercising any right or remedy hereunder or thereunder shall operate as
a waiver of such right or remedy or any other right or remedy. A waiver on any
one occasion shall not be construed as a bar to or waiver of any right or remedy
on any future occasion.

            9.7 Governing Law. This Agreement and the Services Agreement, and
the rights and liabilities of the parties hereunder and thereunder, shall be
governed by the substantive laws of the State of New York (as permitted by
Section 5-1401 of the General Obligations Law) without giving effect to any
choice of law rule that would cause the application of laws of any


                                       14
<PAGE>

jurisdiction other than the internal laws of the State of New York to the rights
and duties of the parties. All disputes between the parties arising out of this
Agreement shall be settled by the parties amicably through good faith
discussions upon the written request of any party. In the event that any such
dispute cannot be resolved thereby within a period of sixty (60) days after such
notice has been given, such dispute shall be finally settled by arbitration
administered by the American Arbitration Association in New York, New York,
using the English language, and under its International Arbitration Rules. The
arbitration panel may grant specific performance, and to allocate between the
parties the costs of arbitration in such equitable manner as the panel may
determine. The prevailing party in the arbitration shall be entitled to receive
reimbursement of its reasonable expenses incurred in connection therewith.
Judgment upon the award so rendered may be entered in any court having
jurisdiction or application may be made to such court for judicial acceptance of
any award and an order of enforcement, as the case may be. Notwithstanding the
foregoing, any party shall have the right to institute a legal action in a court
of proper jurisdiction for injunctive relief or a decree for specific
performance pending final settlement by arbitration. Subject to the foregoing
the parties hereto consent to the non-exclusive jurisdiction of any New York
State or Federal Court of competent jurisdiction in the Borough of Manhattan,
New York City, and any court having jurisdiction of any appeal therefrom in any
action or proceeding arising out of or relating to this Agreement, the Licensed
Property or the Licensee Developments.

            9.8 Headings. The headings contained in this Agreement are for
convenience only and are not a part of this Agreement, and do not in any way
interpret, limit or amplify the scope, extent or intent of this Agreement, or
any of the provisions of this Agreement.

            9.9 Counterparts and Facsimile. This Agreement may be executed in
counterparts, each of which shall constitute an original, but all of which
together shall constitute one and the same agreement. Transmission of facsimile
copies of signed original signature pages of this Agreement shall have the same
effect as delivery of the signed originals.

            9.10 Third Party Beneficiary. Neither this Agreement nor the
Maintenance Agreement is intended to and neither confers any rights on any third
party, and no such third party shall be a third party beneficiary under or in
respect of this Agreement or the Maintenance Agreement.

            9.11 Binding Effect. Subject to Section 9.3 hereof, this Agreement
shall be binding upon and shall inure to the benefit of the parties and their
respective successors and assigns.

            9.12 Independent Contractors. The parties shall for all purposes
hereunder and under the Maintenance Agreement be considered independent
contractors with respect to each other, and neither shall be considered an
employee, employer, agent, principal, partner, franchisee, franchisor or joint
venturer of the other.


                                       15
<PAGE>

      IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

BREAKAWAY SOLUTIONS, INC.                 BREAKAWAY SOLUTIONS ASIA
                                          PACIFIC LIMITED


By: /s/ Gordon Brooks                     By: /s/ Tiak Koon Loh
    -------------------------------          ---------------------------------

NAME_______________________________       NAME________________________________

TITLE______________________________       TITLE_______________________________

DATE_______________________________       DATE________________________________


                                       16
<PAGE>

                                    EXHIBITS

Exhibit A:  Licensed Marks
Exhibit B:  Licensed Software
Exhibit C:  Services Agreement


                                       17
</TEXT>
</DOCUMENT>
