Travelzoo 2007 Annual Report Download - page 46

We may not be able to access third party technology upon which we depend.
We use technology and software products from third parties, including Microsoft. Technology from our current
or other vendors may not continue to be available to us on commercially reasonable terms, or at all. Our business
will suffer if we are unable to access this technology, to gain access to additional products or to integrate new
technology with our existing systems. This could cause delays in our development and introduction of new services
and related products or enhancements of existing products until equivalent or replacement technology can be
accessed, if available, or developed internally, if feasible. If we experience these delays, our business could be
materially adversely affected.
Risks Related to the Market for our Shares
Our stock price has been volatile historically and may continue to be volatile.
The trading price of our common stock has been and may continue to be subject to wide fluctuations. During
2007, the sales price of our common stock on the NASDAQ Global Select Market ranged from $13.44 to $40.68.
Our stock price may fluctuate in response to a number of events and factors, such as quarterly variations in operating
results; announcements of technological innovations or new products by us or our competitors; changes in financial
estimates and recommendations by securities analysts; the operating and stock price performance of other
companies that investors may deem comparable to us; and news reports relating to trends in our markets or
general economic conditions.
In addition, the stock market in general, and the market prices for Internet-related companies in particular,
have experienced volatility that often has been unrelated to the operating performance of such companies. These
broad market and industry fluctuations may adversely affect the price of our stock, regardless of our operating
performance.
We are controlled by a principal stockholder.
Ralph Bartel, who founded Travelzoo and who is our Chairman of the Board, President, and Chief Executive
Officer, is our largest stockholder, holding beneficially, as of December 31, 2007, approximately 53.7% of our
outstanding shares with options to increase his percentage ownership to 59.8% on a fully-diluted basis. Through his
share ownership, he is in a position to control Travelzoo and to elect our entire board of directors.
Risks Related to Legal Uncertainty
We may become subject to burdensome government regulations and legal uncertainties affecting the
Internet which could adversely affect our business.
To date, governmental regulations have not materially restricted use of the Internet in our markets. However,
the legal and regulatory environment that pertains to the Internet is uncertain and may change. Uncertainty and new
regulations could increase our costs of doing business, prevent us from delivering our products and services over the
Internet or slow the growth of the Internet. In addition to new laws and regulations being adopted, existing laws may
be applied to the Internet. New and existing laws may cover issues which include:
• user privacy;
• anti-spam legislation;
• consumer protection;
• copyright, trademark and patent infringement;
• pricing controls;
• characteristics and quality of products and services;
• sales and other taxes; and
• other claims based on the nature and content of Internet materials.
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