Travelzoo 2015 Annual Report Download - page 16

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Our General Counsel and/or Chief Financial Officer review(s) all material related party transactions involving the
Company and any of the Company's principal shareholders or members of our board of directors, nominees, or senior
management or any immediate family member of any of the foregoing. When a potential related party transaction is identified,
the General Counsel and/or the Chief Financial Officer will evaluate the transaction and determine whether the transaction
requires the review and approval by the Audit Committee or a special committee of the Board consisting of independent
directors (“Special Committee”). A general statement that the Audit Committee may review related party transactions is set
forth in our audit committee charter, which was attached as Appendix A to our proxy statement for the 2008 Annual Meeting of
Stockholders which has been filed with the SEC. Upon submission to the Audit Committee or a Special Committee, such
committee will consider relevant facts and circumstances surrounding each related party transaction and any matters the
committee deems appropriate. If the Audit Committee or a Special Committee determines that any such related party
transaction creates a conflict of interest situation or would require disclosure under Item 404 of Regulation S-K, as promulgated
by the SEC, the transaction must be approved by the committee prior to the Company entering into such transaction or ratified
thereafter. Transactions or relationships previously approved by the Audit Committee or a Special Committee in existence prior
to the formation of the committee do not require approval or ratification.
Ralph Bartel, who founded Travelzoo and who is a director of the Company, is the sole beneficiary of the Ralph Bartel
2005 Trust, which is the controlling shareholder of Azzurro Capital Inc. (“Azzurro”). As of March 10, 2016, Azzurro is the
Company's largest stockholder, holding approximately 51.7% of the Company's outstanding shares.
On August 20, 2015, Travelzoo acquired the Travelzoo Asia Pacific business (“Asia Pacific”), which includes the
Travelzoo businesses in Australia, China, Hong Kong, Japan, Taiwan, and Southeast Asia. This business was independently
operated by Azzurro Capital Inc. under a licensing agreement with Travelzoo Inc. The Company held an option right to acquire
Asia Pacific at fair market value as determined by a third party valuation expert. Under the terms of the definitive acquisition
agreement, Travelzoo (Europe) Limited, a United Kingdom subsidiary of the Company, was authorized by the Company to
exercise the option right to acquire Asia Pacific for a fair market transaction value of $22.6 million, subject to a working capital
adjustment. As part of the acquisition, Travelzoo (Europe) Limited issued a promissory note to Azzurro with a principal amount
of $5.7 million, with a maturity date of August 20, 2018 and the ability to pay off principal prior to this maturity date with no
prepayment penalty and a stated interest rate of 7%. In January 2016, the full amount of the loan was paid off by Travelzoo
(Europe) Limited.
Family Relationships
Holger Bartel, chairman of the Board of Directors and Global Chief Executive Officer, and Ralph Bartel, a member of
the Board of Directors, are brothers. Except for Holger Bartel and Ralph Bartel, there are no familial relationships among any
of our officers and directors.
Involvement in Certain Legal Proceedings
To our knowledge, during the last ten years, none of our directors and executive officers has: (i) had a bankruptcy
petition filed by or against any business of which such person was a general partner or executive officer either at the time of the
bankruptcy or within two years prior to that time; (ii) been convicted in a criminal proceeding or been subject to a pending
criminal proceeding, excluding traffic violations and other minor offenses; (iii) been subject to any order, judgment or decree,
not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining,
barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; (iv) been
found by a court of competent jurisdiction (in a civil action), the SEC, or the Commodities Futures Trading Commission to
have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated; or
(v) been the subject to, or a party to, any sanction or order, not subsequently reverse, suspended or vacated, of any self-
regulatory organization, any registered entity, or any equivalent exchange, association, entity or organization that has
disciplinary authority over its members or persons associated with a member.