Travelzoo 2013 Annual Report Download - page 18

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Pursuant to the terms of Mr. Ceremony's employment agreement dated May 9, 2011, effective June 15, 2011 and as
amended January 1, 2013, Mr. Ceremony is eligible to receive a quarterly Performance Bonus for each quarter during 2013.
The quarterly Performance Bonus is calculated based upon worldwide revenue, operating income and audience
targets. The revenue bonus is calculated based upon a sliding scale that ranges from 95% through 105% achievement of the
target resulting in a potential bonus that ranges from $10,000 to $20,000. The quarterly revenue bonus at 100% of target is
$16,667 and the maximum revenue bonus is $20,000. The revenue bonus requires that there are no more than two significant
customers and that no significant customer is 17% or more than worldwide revenue. The operating income bonus is calculated
based upon a sliding scale that ranges from 90% through 105% achievement of the target resulting in a potential bonus that
ranges from $10,000 to $20,000. The quarterly operating income bonus at 100% of target is $16,667 and the maximum
operating income bonus is $20,000. The audience bonus is calculated based upon achievement of certain audience targets
resulting in a potential bonus of up to $16,666. The total maximum Performance Bonus per quarter for the revenue, operating
income and audience components combined is $56,666.
Mr. Ceremony earned a quarterly bonus for revenue and operating income in the first and second quarters of 2013 and
earned a quarterly bonus for the audience for each quarter of 2013. Mr. Ceremony received Performance Bonuses totaling
$116,178 during 2013. For 2013, Mr. Ceremony received 51% of the maximum Performance Bonus. The Company believes
that targets set for worldwide revenue, operating income and audience align with the Company's desire to continue to grow the
business. Since the individual targets are intended to be challenging, and since the separate targets related to different aspects of
the Company's performance, it is expected it will be difficult for all the targets to be achieved for any given year.
Mr. Ceremony is also eligible to receive a Discretionary Bonus to be determined by the Chief Executive Officer and
the Board of Directors at their sole and absolute discretion. In exercising such discretion, the CEO and Board of Directors take
into consideration Mr. Ceremony's individual performance. In evaluating Mr. Ceremony's individual performance during 2013,
the CEO and Board of Directors considered factors such Mr. Ceremony's role as an advisor to the CEO on how to improve the
Company's financial performance, his initiatives to improve the Company's management information systems, his leadership in
the areas of corporate governance and business ethics, and the quality of his management of the Company's relationships with
the investment community. Mr. Ceremony received Discretionary Bonuses totaling $88,889 in 2013.
Pursuant to the terms of Ms. Tafoya's employment agreement dated August 4, 2010, effective July 1, 2010 and as
amended January 1, 2013, Ms. Tafoya is eligible to receive a quarterly Performance Bonus for each quarter during 2013.
The quarterly Performance Bonus is calculated based upon North America revenue, operating income and audience
targets. The revenue bonus is calculated based upon a sliding scale that ranges from 95% through 105% achievement of the
target resulting in a potential bonus that ranges from $24,000 to $48,000. The quarterly revenue bonus at 100% of target is
$40,000 and the maximum revenue bonus is $48,000. The revenue bonus requires that there are no more than two significant
customers and that no significant customer is 17% or more than North America revenue. The operating income bonus is
calculated based upon a sliding scale that ranges from 90% through 105% achievement of the target resulting in a potential
bonus that ranges from $24,000 to $48,000. The quarterly operating income bonus at 100% of target is $40,000 and the
maximum operating income bonus is $48,000. The audience bonus is calculated based upon achievement of certain audience
targets resulting in a potential bonus of up to $40,000. The total maximum Performance Bonus per quarter for the revenue,
operating income and audience components combined is $136,000.
Ms. Tafoya earned a quarterly bonus for revenue, operating income and audience for each of the quarters of 2013.
Ms. Tafoya received Performance Bonuses totaling $443,561 during 2013. For 2013, Ms. Tafoya received 82% of the
maximum Performance Bonus. The Company believes that targets set for North America revenue, operating income and
audience align with the Company's desire to continue to grow the business. Since the individual targets are intended to be
challenging, and since the separate targets related to different aspects of the Company's performance, it is expected it will be
difficult for all the targets to be achieved for any given year.
Ms. Tafoya is also eligible to receive a Discretionary Bonus to be determined by the CEO and the Board of Directors
at their sole and absolute discretion. In exercising such discretion, the CEO and Board of Directors take into consideration
Ms. Tafoya's individual performance. In evaluating Ms. Tafoya's individual performance during 2013, the CEO and Board of
Directors considered factors such as the quality of Ms. Tafoya's strategic management to ensure the long-term success of the
Company, the development of the Company's leadership talent, the quality of the content of the Company's publications, and
the development of the Travelzoo brand. Ms. Tafoya received Discretionary Bonuses totaling $30,000 in 2013.
Pursuant to the terms of Mr. Singer's employment agreement dated October 31, 2011, effective January 16, 2012 and
as amended July 1, 2012 and January 1, 2013, Mr. Singer is eligible to receive a quarterly Performance Bonus for each quarter