SCHEDULE 14A
(Rule 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
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MaxWorldwide, Inc.
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(Name of Registrant as Specified in Its Charter)
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MAXWORLDWIDE, INC.
50 West 23rd Street, Fourth Floor
New York, New York 10010
(212) 302-2424
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PROXY STATEMENT SUPPLEMENT
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This Proxy Statement Supplement is being furnished to stockholders of
MaxWorldwide, Inc. in connection with the solicitation of proxies by the Board
of Directors of MaxWorldwide from stockholders of record of MaxWorldwide for use
at our 2003 Annual Meeting of Stockholders to be held at the Chicago offices of
MaxWorldwide, located at 221 North LaSalle Street, Suite 650, Chicago, Illinois
60601 on July 22, 2003 at 11:00 AM local time, or any adjournment or
postponement thereof. This Proxy Statement Supplement amends and supplements the
Proxy Statement of MaxWorldwide dated June 30, 2003, and mailed to our
stockholders on approximately June 30, 2003.
RECENT DEVELOPMENTS
On July 9, 2003, our legal counsel sent a letter to DoubleClick Inc.
("DoubleClick") notifying DoubleClick that we intend to pursue legal claims
against DoubleClick arising out of the sale of DoubleClick's online media
business to us on July 10, 2002. These claims are for indemnification for
alleged violations by DoubleClick of the Agreement and Plan of Merger by and
among us, DoubleClick, L90, Inc., DoubleClick Media Inc., Picasso Media
Acquisition, Inc. and Lion Merger Sub, Inc., dated June 29, 2002 (the "Merger
Agreement"). In the letter, we also reserve the right to pursue legal claims
outside of the Merger Agreement, which relate to the sale of DoubleClick's
online media business. These claims include, but are not limited to, claims for
fraudulent inducement, breach of covenants in the Merger Agreement, tortious
interference with contractual relations and tortious interference with
prospective economic advantage. The claims against DoubleClick for
indemnification under the Merger Agreement are for not less than $6.5 million,
and the legal claims outside of the Merger Agreement are for an unspecified
amount.
On that same date, we received a letter from legal counsel for DoubleClick
advising us that DoubleClick intends to pursue certain legal claims against us
arising out of the sale of DoubleClick's online media business to us on July 10,
2002. These claims are for indemnification for alleged violations by us of the
Merger Agreement. In addition, the letter notifies us that DoubleClick intends
to pursue additional claims outside of the Merger Agreement for fraud in the
inducement and securities fraud, relating to the sale of the online media
business. DoubleClick is seeking damages of not less than $10 million. We
believe these claims are without merit and we intend to vigorously defend all of
these claims if and when they are brought.
As described in the Proxy Statement, one of the purposes of the Annual
Meeting of Stockholders is to approve and adopt a plan of liquidation and
dissolution pursuant to which we would liquidate and dissolve MaxWorldwide and
its subsidiaries, as more particularly described in Proposal No. 2 in the Proxy
Statement. This plan is conditioned upon the consummation of the MaxOnline Sale
contemplated by the Agreement and Plan of Merger that is the subject of Proposal
No. 1 in the Proxy Statement. We currently still intend to make the partial
distribution of $12,250,000 in cash, subject to adjustment, described in
Proposal No. 2 in the Proxy Statement as soon as practicable following the
closing of the MaxOnline Sale; however, this initial distribution as well as the
amount and timing of any further distributions may be affected by the potential
claims from DoubleClick described above. We are not permitted by Delaware law to
make any payments in excess of our expenses and liabilities. The potential
claims from DoubleClick may increase the amount of contingent liabilities
against which we may have to
create a cash reserve. The amount of available cash to be distributed to our
stockholders in the future will be reduced by any cash reserve that is created.
The Company's Proxy Statement is amended and supplemented as set forth
herein.
By Order of the Board of Directors
/s/ Peter M. Huie
Peter M. Huie
Secretary