Travelzoo 2002 Annual Report Download - page 11

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Stock-Based Compensation
Travelzoo did not compensate executives with stock or stock options in 2002. The options issued to
Mr. Bartel during 2002 constitute compensation for participation on the Board of Directors. Travelzoo does
currently not intend to compensate executives with stock or stock options. The Compensation Committee will
continue to evaluate stock-based compensation versus cash compensation in the future.
CEO Compensation
The CEO's compensation is determined in accordance with the executive compensation principles
established by the committee. The committee considers overall performance, individual performance,
competitive compensation and targeted pay levels when determining Mr. Bartel's compensation. His current
employment agreement became eÅective on October 1, 2000, and provides for an annual salary of $192,000.
No changes to Mr. Bartel's salary were made in 2002.
Compensation Committee
Ralph Bartel
Kelly M. Urso
Compensation Committee Interlocks and Insider Participation
During 2002, Ralph Bartel, the Chief Executive OÇcer of Travelzoo, was a member of the Compensation
Committee. Mr. Bartel did not participate in the determination of his compensation as CEO during 2002.
Section 16 BeneÑcial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our executive oÇcers and directors, and
any persons beneÑcially owning more than ten percent of our common stock to report their ownership of stock
and any changes in ownership to the SEC and to The NASDAQ National Market. The SEC has established
speciÑc due dates for these reports and we are required to report in this proxy statement any failure to Ñle by
these dates. These reporting requirements did not apply during our 2002 Ñscal year, because we did not have
any class of equity securities registered under the Exchange Act. Our Exchange Act registration became
eÅective on January 30, 2003.
RATIFICATION OF INDEPENDENT AUDITORS (PROXY ITEM NO. 2)
Our Audit Committee, pursuant to its charter, has recommended and the Board of Directors has
approved the appointment of KPMG LLP as Travelzoo's principal independent auditors to examine the
consolidated Ñnancial statements of Travelzoo and its subsidiaries for our 2003 Ñscal year.
The Audit Committee and our Board of Directors are requesting that the stockholders ratify the
appointment of KPMG LLP as Travelzoo's principal independent auditors. The Audit Committee and the
Board of Directors are not required to take any action as a result of the outcome of the vote on this proposal.
However, if the stockholders do not ratify the appointment, the Audit Committee may investigate the reasons
for stockholder rejection and may consider whether to recommend that the Board of Directors retain KPMG
LLP or to appoint other independent auditors. Furthermore, even if the appointment is ratiÑed, the Audit
Committee in its discretion may recommend and the Board of Directors can approve the appointment of
diÅerent independent auditors at any time during the year if they determine that such a change would be in
the best interests of Travelzoo and its stockholders.
KPMG LLP representatives are not expected to be present at the Annual Meeting or to make a formal
statement. Consequently, representatives of KPMG LLP will not be available to respond to questions at the
meeting.
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