Exhibit 10.1

 

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (this “Agreement”) is entered
into as of September 1, 2009 (the “Effective Date”), by and between Travelzoo
Inc., a Delaware corporation (the “Company”) with principal corporate offices at
590 Madison Avenue, 37th Floor, New York, NY 10022, and Max Rayner, whose
address is currently xxxx xxxxxxxxx, Palo Alto, CA xxxxxx (“Employee”). The
Company and Employee are at certain times each referred to herein as a Party,
and collectively referred to herein as “the Parties.”

The Company and Employee previously entered into an Employment Agreement dated
November 5, 2007 (the “Prior Agreement”), providing for employment of Employee
in the position of Chief Information Officer (“CIO”). Section 2(d)(1) of the
Prior Agreement provided that Employee had the right to resign for Good Reason
and collect Severance Pay if the Company did not make a Bona Fide Offer for
Employee to serve as Chief Executive Officer of the Company.

The Company desires to employ Employee as the Chief Technology Officer (“CTO”)
on the terms and conditions as set forth in this Agreement. The Company further
desires to pay the Severance Pay provided for in the Prior Agreement in
consideration for Employee’s agreement not to resign for Good Reason under
Section 2(d)(1) of the Prior Agreement and to provide the General Release of
claims set forth in Section 8(a) of this Agreement. This Agreement amends,
restates and supersedes the Prior Agreement and provides for a General Release
by Employee up to the Effective Date of this Agreement.

In consideration of the promises and mutual covenants herein contained, and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, it is mutually agreed by the Parties as follows:

1.       Duties and Scope of Employment.

(a)       Position. Employee shall be employed as CTO in the Company’s Mountain
View, California office.

(b)       Duties. As CTO, Employee shall provide global executive leadership for
the Company in the areas of technology, including Engineering, Product
Development and Information Systems.

During the term of Employee’s employment with the Company, Employee shall devote
his full time, skill and attention to his duties and responsibilities as CTO,
which Employee shall perform faithfully, diligently and competently, and
Employee shall use his best efforts to further the business of the Company.
During the term of the Agreement, Employee agrees not to actively engage in any
other employment, occupation or consulting activity for any direct or indirect
remuneration without the prior approval of the Company, except that this
provision shall not be interpreted to prohibit Employee from involvement in any
charitable or community activity/organization that he is currently involved in
and that does not materially interfere with his ability to perform his

 

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duties under this Agreement. Employee shall be permitted, to the extent such
activities do not materially and adversely affect the ability of Employee to
fully perform his duties and responsibilities hereunder, to (i) manage
Employee’s personal, financial and legal affairs, (ii) serve on civic or
charitable boards or committees, (iii) independently perfect prior personal
intellectual property in the areas described in Exhibit A, and (iv) with the
consent of the Company (which consent shall not be unreasonably withheld and is
given herein for the cases listed in Exhibit B), serve as an adviser or a member
or non-executive chairman of the board of directors of any noncompeting
business.

2.         Term of Employment. The term of this Agreement shall be for the
period (the “Term”) commencing on the Effective Date and terminating on
September 30, 2010 (the “Expiration Date”). Notwithstanding the foregoing, this
Agreement shall expire on the date the Employee dies, and may be terminated by
the Company or by Employee during the Term, by delivery of written notice, for
Cause or for Good Reason (as hereinafter defined), because of Disability (as
hereinafter defined), or without Cause or Good Reason. If Employee continues in
employment after the Expiration Date, any such employment will be on an at will
basis.

 

(a)       Termination by Company without Cause. If Employee is terminated by the
Company during the Term for reasons other than Cause (as defined in Section
2(b)), the Company shall provide two weeks written notice or two week pay in
lieu of notice, and Employee shall receive his Base Salary and benefits earned
through the date of termination, and pro rata bonuses pursuant to Sections 4(b)
and 4(c), if any, for the calendar quarter in which Employee ceased performing
services for the Company.

(b)       Termination for Cause. Notwithstanding any provision of this Agreement
to the contrary, if Employee is terminated for “Cause” as defined herein,
Employee will receive only payment of his Base Salary and benefits through the
date of termination. For purposes of this Agreement, “Cause” shall mean that the
Employee has (i) continually failed to perform his duties under this Agreement
for a period of 30 days after written notice from the Company setting forth with
particularity such failure, (ii) committed an act of fraud upon the Company or
breached his duty of loyalty to the Company, (iii) committed a felony or a crime
of dishonesty, fraud or moral turpitude under the laws of the United States or
any state thereof; (iv) misappropriated any funds, property or rights of the
Company; (v) violated the Company’s policies regarding workplace conduct,
discrimination, or sexual harassment; (vi) willfully failed or refused,
following receipt of an explicit directive from the Company, to comply with the
material terms of this Agreement; or (vii) failed or refused to cooperate with
the Company, or at the Company’s request any governmental, regulatory or
self-regulatory agency or entity, in providing information with respect to any
act or omission in performing his duties as an employee of the Company, if such
request is made connection with any criminal or civil actions, administrative or
regulatory proceedings or investigations against or relating to the Company by
any governmental, regulatory or self-regulatory agency or entity.

(c)       Termination because of Death or Disability.

(i)        If Employee’s employment terminates during the Term in connection
with his death or Disability (as defined herein) in the course of

 

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Company business or Company-related travel and activities by whatever means
(natural, un-natural, criminal acts, terrorism, or acts of god), in additional
to amounts payable under Section 2(c)(ii) below, the Company shall pay an amount
equal to one year of Employee’s Base Salary to Employee’s beneficiary or
beneficiaries as designated in Exhibit C, or designated subsequent to this
Agreement via Notice to the Company.

(ii)       If Employee is terminated as a result of his death or a “Disability”
(as defined herein) during the Term, for reasons other than described in Section
2(c)(i) above, Employee or Employee’s legal representative will receive only
payment of his Base Salary, and benefits through the date of termination, and
pro rata bonuses pursuant to Sections 4(b) and 4(c), if any, for the calendar
quarter in which Employee ceased performing services for the Company (“Active
Employment”) based on performance through the last day of Active Employment. For
purposes of this Agreement, “Disability” shall mean a physical or mental
impairment that prevents or can be reasonably expected to prevent the
performance by the Employee of his duties hereunder for a continuous period of
120 calendar days or longer, or that prevents the performance by Employee of his
duties hereunder for more than a total of 85 business days, in any 12-month
period, subject to the reasonable accommodation requirements of the Americans
with Disabilities Act and other applicable laws.

(d)       Employee Resignation for Good Reason. Employee may resign for Good
Reason if at any time during the Term (i) his responsibilities, title, duties
and/or stature are materially diminished; (ii) his Base Salary or the potential
amount of his Performance Bonus or Discretionary Bonus are materially reduced;
(iii) his place of work is relocated to more than 30 miles from Mountain View,
California; or (iv) the Company is in material breach of its obligations under
this Agreement. Employee may exercise the right to resign for Good Reason
pursuant to this Section 2(d) only if the Company fails to cure any such
deficiency within thirty (30) calendar days of receiving timely written notice
from Employee. Employee must provide said written notice to the Company within
thirty (30) calendar days after receiving notice of an event triggering the
right to resign for Good Reason under this Section (2)(d). If Employee resigns
pursuant to this Section 2(d), Employee shall receive his Base Salary and
benefits earned through the date of termination, and pro rata bonuses pursuant
to Sections 4(b) and 4(c), if any, for the calendar quarter in which Employee
ceased performing services for the Company.

(e)       Employee Resignation Following a Change of Control. If, after a Change
of Control, as hereinafter defined, occurs during the Term, Employee is not
offered a position of comparable compensation, responsibilities, title, duties
and/or stature within the Company in the same geographic area in which he worked
immediately prior to a Change of Control (unless relocated to New York City by
mutual consent), and Employee resigns within thirty (30) calendar days after the
Change in Control, Employee shall receive his Base Salary and benefits earned
through the date of termination, and pro rata bonuses pursuant to Sections 4(b)
and 4(c), if any, for the calendar quarter in which Employee ceased performing
services for the Company. For purposes of this Agreement, “Change of Control”
means (i) a merger, consolidation, reorganization or other

 

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transaction in which the Company does not survive and in which securities
possessing more than 50% of the total combined voting power of the Company’s
outstanding voting securities are transferred or issued to a person or persons
different from the persons holding those securities immediately prior to such
transaction, or (ii) the sale, transfer or other disposition of all or
substantially all of the Company’s assets.

(f)        Resignation Without Good Reason. Employee may resign at any time
without Good Reason after providing two weeks written notice to the Company. If
Employee resigns without Good Reason, Employee will receive only payment of his
Base Salary and benefits through the date of termination.

3.         Prior Agreement “Good Reason” Severance Payment. The Parties
acknowledge and agree that Employee had the option to resign for Good Reason and
collect Severance Pay under Section 2(d)(1) of the Prior Agreement because the
Company did not make a Bona Fide Offer for Employee to serve as Chief Executive
Officer of the Company. In consideration for Employee’s agreement not to resign
for Good Reason under Section 2(d)(1) of the Prior Agreement and for the General
Release of claims set forth in Section 8(a) of the Agreement, the Company agrees
to pay Employee a lump sum gross amount of $450,000, less applicable taxes and
withholdings, subject to Employee executing the Agreement and not revoking the
General Release set forth in Section 8(a). The payment shall be paid on
September 9, 2009, subject to the following conditions precedent: (i) Employee’s
delivery of the original signed Agreement to Company; and (ii) expiration of the
revocation period set forth in Section 8(d).

4.         Compensation and Fringe Benefits.

(a)       Base Salary. Employee will receive a base salary at the annualized
rate of $517,500 per year (the “Base Salary”), which shall be paid periodically
in accordance with normal Company payroll practices and subject to the usual and
applicable required withholdings. Employee understands and agrees that neither
his job performance nor promotions, commendations, bonuses or the like from the
Company give rise to or in any way serve as the basis for modification,
amendment, or extension, by implication or otherwise, of this Agreement.

(b)       Performance Bonus. Employee will be eligible to participate in a
quarterly Performance Bonus plan (“Performance Bonus”), under which Employee may
receive, in addition to his Base Salary, a bonus in an amount between zero and
$60,000 per calendar quarter. Employee must be employed by the Company through
the last day of the quarter in order to receive any Performance Bonus
attributable to such quarter with the following exceptions: the bonus for such
quarter shall be pro rated only if the first or last calendar quarter of the
Term is less than a full quarter because: (i) the Agreement expired at the end
of the Term or Employee died; (ii) Employee’s employment is terminated without
Cause under Section 2(a) or due to death or a disability under Section 2(c); or
(iii) Employee resigns for Good Reason under Section 2(d) or following a Change
of Control under Section 2(e).

The following schedule applies for calculating a bonus.

 

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Criteria

Amount

Worldwide revenue target for the quarter met AND there are no more than two
Significant Customers AND no Significant Customer accounts for 17% or more of
Worldwide consolidated revenue for the quarter.

$20,000

Worldwide operating income target for the quarter met.

$20,000

Worldwide subscriber target for the quarter met.

$20,000

Total max. Performance Bonus per quarter

$60,000

“Significant Customer” means, for any quarter, a customer that, together with
its affiliates, accounts for 10% (rounded to the nearest 1%) or more of the
Company’s worldwide consolidated revenue for the quarter.

The Company’s Chief Financial Officer will determine if the criteria are met.

Any bonus payment, if applicable, shall be paid to Employee in a lump sum as
soon as administratively practicable following the end of the quarter to which
it relates but no later than sixty (60) days after the end of the quarter and
will be subject to applicable withholding and payroll taxes.

The Company shall notify Employee of any changes to the Performance Bonus in
writing, which changes will not take effect until the quarter following the
notice of change.

If either the first or last calendar quarter of the Term is less than a full
quarter, the bonus for such quarter shall be pro rated. Any bonus payments, if
applicable, shall be made at the time specified in the Performance Bonus Plan
and will be subject to the usual and applicable withholding and payroll taxes.
The Company shall notify Employee of any changes to the Performance Bonus Plan
in writing.

(c)       Discretionary Bonus. In addition to Base Salary and any Performance
Bonus payable under the Performance Bonus Plan, Employee shall be eligible to be
considered for a Discretionary CTO Bonus in an amount between zero and $50,000
per calendar quarter to be determined by the CEO in his sole and absolute
discretion. In exercising such discretion, the CEO will take into consideration
to what extent Employee

 

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achieves the following strategic goals: (i) transform the national IT
organization into a fast and efficient global IT function with 24/7 support;
(ii) improve organizational structure of IT department and agility of IT staff;
(iii) create the ability to support a frequency of new product releases of three
new products in twelve months, whether in terms of new global products or
product extensions in geographic reach or significant new features; and (iv)
implement a management information system that allows Company to better monitor
delivery of ad campaigns and more accurately forecast revenue. If either the
first or last calendar quarter of the Term is less than a full quarter, the
bonus for such quarter shall be pro rated as provided in Section 4(b). Any bonus
payment, if applicable, shall be paid to Employee in a lump sum as soon as
administratively practicable following the end of the quarter to which it
relates but no later than sixty (60) days after the end of the quarter and will
be subject to applicable withholding and payroll taxes.

(d)       Vacation and Holiday Pay. Employee shall receive four (4) weeks of
paid vacation per year, which accrues over the course of the year. In addition,
the Company provides eight (8) paid holidays each year, along with two (2)
“floating holidays” which can be used by Employee at any time.

(e)       Other Benefits. Employee will be entitled to participate in or receive
such benefits under the Company’s employee benefit plans and policies and such
other benefits which may be made available as in effect from time to time and as
are provided to similarly situated employees of the Company, subject in each
case to the generally applicable terms and conditions of the plans and policies
in question.

5.         Expenses. The Company will pay or reimburse Employee for reasonable
travel, entertainment or other expenses incurred by Employee in the furtherance
of or in connection with the performance of Employee’s duties hereunder in
accordance with the Company’s established policies. The amount of expenses
eligible for reimbursement during a year shall not affect the expenses eligible
for reimbursement in any other year. Reimbursement of an eligible expense shall
be made in accordance with the Company’s policies and practices and as otherwise
provided herein, provided, that, in no event shall reimbursement be made after
the last day of the year following the year in which the expense was incurred.
The right to reimbursement is not subject to liquidation or exchange for another
benefit.

6.         Certain Covenants.

(a)       Intellectual Property Rights.

(i)        Employee agrees that the Company will be the sole owner of any and
all of Employee’s “Discoveries” and “Work Product,” hereinafter defined, made
during the term of his employment with the Company, whether pursuant to this
Agreement or other duties performed on behalf of the Company, except for
discoveries or intellectual property development made during the term of
employment in the areas described in Exhibit A, and except for those that the
employee developed entirely on his own time without using the Company’s
equipment, supplies, facilities, or trade secret information and unrelated at
the time of conception or reduction to practice to the Company’s business, or
actual

 

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or demonstrably anticipated research or development and not resulting from any
work performed by the Employee for the Company.

For purposes of this Agreement, “Discoveries” means all inventions, discoveries,
improvements, and copyrightable works (including, without limitation, any
information relating to the Company’s software products, source code, know-how,
processes, designs, algorithms, computer programs and routines, formulae,
techniques, developments or experimental work, work-in-progress, or business
trade secrets) made or conceived or reduced to practice by Employee during the
term of his employment by the Company, whether or not potentially patentable or
copyrightable in the United States or elsewhere. For purposes of this Agreement,
“Work Product” means any and all work product relating to Discoveries.

(ii)       Employee shall promptly disclose to the Company all Discoveries and
Work Product. All such disclosures must include complete and accurate copies of
all source code, object code or machine-readable copies, documentation, work
notes, flow-charts, diagrams, test data, reports, samples, and other tangible
evidence or results (collectively, “Tangible Embodiments”) of such Discoveries
or Work Product. All Tangible Embodiments of any Discoveries or Work Project
will be deemed to have been assigned to the Company as a result of the act of
expressing any Discovery or Work Product therein.

(iii)      Employee hereby assigns and agrees to assign to the Company all of
his interest in any country in any and all Discoveries and Work Product, whether
such interest arises under patent law, copyright law, trade-secret law,
semiconductor chip protection law, or otherwise. Without limiting the generality
of the preceding sentence, Employee hereby authorizes the Company to make any
desired changes to any part of any Discovery or Work Product, to combine it with
other materials in any manner desired, and to withhold Employee’s identity in
connection with any distribution or use thereof alone or in combination with
other materials. This assignment and assignment obligation applies to all
Discoveries and Work Product arising during Employee’s employment with the
Company (or its predecessors), whether pursuant to this Agreement or otherwise.
Employee’s agreement to assign to the Company any of his rights as set forth in
this Section 6(a)(iii) applies to all inventions other than an invention (a) in
which no equipment, supplies, facility or trade secret information of the
Company was used (b) was developed entirely upon Employee’s own time (c) does
not relate to Company business or to the Company’s actual or anticipated
research or development and (d) does not result from any work performed by
Employee for the Company.

(iv)      At the request of the Company, Employee shall promptly and without
additional compensation execute any and all patent applications, copyright
registration applications, waivers of moral rights, assignments, or other
instruments that the Company deems necessary or appropriate to apply for or
obtain Letters Patent of the United States or any foreign country, copyright

 

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registrations or otherwise to protect the Company’s interest in such Discovery
and Work Product, the expenses for which will be borne by the Company. Employee
hereby irrevocably designates and appoints the Company and its duly authorized
officers and agents as his agents and attorneys-in-fact to, if the Company is
unable for any reason to secure Employee’s signature to any lawful and necessary
document required or appropriate to apply for or execute any patent application,
copyright registration application, waiver of moral rights, or other similar
document with respect to any Discovery and Work Product (including, without
limitation, renewals, extensions, continuations, divisions, or continuations in
part), (i) act for and in his behalf, (ii) execute and file any such document,
and (iii) do all other lawfully permitted acts to further the prosecution of the
same legal force and effect as if executed by him; this designation and
appointment constitutes an irrevocable power of attorney coupled with an
interest.

(v)       To the extent that any Discovery or Work Product constitutes
copyrightable or similar subject matter that is eligible to be treated as a
“work made for hire” or as having similar status in the United States or
elsewhere, it will be so deemed. This provision does not alter or limit
Employee’s other obligations to assign intellectual property rights under this
Agreement.

(vi)      The obligations of Employee set forth in this Section 6 (including,
without limitation, the assignment obligations) will continue beyond the
termination of Employee’s employment with respect to Discoveries and Work
Product conceived or made by Employee alone or in concert with others during
Employee’s employment with the Company, whether pursuant to this Agreement or
otherwise. Those obligations will be binding upon Employee, his assignees
permitted under this Agreement, executors, administrators, and other
representatives.

(b)       Exposure to Proprietary Information.

(i)        As used in this Agreement, “Proprietary Information” means all
information of a business or technical nature that relates to the Company
including, without limitation, all information about software products whether
currently released or in development, all inventions, discoveries, improvements,
copyrightable work, source code, know-how, processes, designs, algorithms,
computer programs and routines, formulae and techniques, and any information
regarding the business of any customer or supplier of the Company or any other
information that the Company is required to keep confidential. Notwithstanding
the preceding sentence, the term “Proprietary Information” does not include
information that is or becomes publicly available through no fault of Employee,
or information that Employee learned prior to the Effective Date.

(ii)       In recognition of the special nature of his employment under this
Agreement, including his special access to the Proprietary Information, and in
consideration of his employment pursuant to this Agreement, Employee agrees to
the covenants and restrictions set forth in Section 6 of this Agreement.

 

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(c)       Use of Proprietary Information; Restrictive Covenants.

(i)        Employee acknowledges that the Proprietary Information constitutes a
protectible business interest of the Company, and covenants and agrees that
during the term of his employment, whether under this Agreement or otherwise,
and after the termination of such employment, he will not, directly or
indirectly, disclose, furnish, make available or utilize any of the Proprietary
Information, other than in the proper performance of his duties for the Company.

(ii)       Employee will not, during the term of this Agreement, anywhere within
the United States (the “Restricted Territory”), directly or indirectly (whether
as an owner, partner, shareholder, agent, officer, director, employee,
independent contractor, consultant, or otherwise), perform services for, or
engage in, any business or segment of a business which generates its revenues
primarily from the development, publishing, or sale of online advertisements for
travel companies (the “Products”);

(iii) Employee will not, during the term of this Agreement or, for a period of
one year thereafter (the “Restricted Period”), anywhere within the United States
(the “Restricted Territory”), directly or indirectly (whether as an owner,
partner, shareholder, agent, officer, director, employee, independent
contractor, consultant, or otherwise):

1.         except on behalf of the Company, use Company Proprietary Information
to solicit any person or entity who is, or was at any time during the
twelve-month period immediately prior to the termination of Employee’s
employment with the Company, a customer of the Company for the sale of the
Products or any product or service of a type then sold by the Company for which
Employee provided any assistance in planning, development, marketing, training,
support, or maintenance; or

2.         solicit for employment any person who is, or was at any time during
the twelve-month period immediately prior to the termination of Employee’s
employment with the Company, an employee of the Company.

(d)       Scope/Severability. The Parties acknowledge that the business of the
Company is and will be national and international in scope and thus the
covenants in this Section 6 would be particularly ineffective if the covenants
were to be limited to a particular geographic area of the United States. If any
court of competent jurisdiction at any time deems the Restricted Period
unreasonably lengthy, or the Restricted Territory unreasonably extensive, or any
of the covenants set forth in this Section 6 not fully enforceable, the other
provisions of this Section 6, and this Agreement in general, will nevertheless
stand and to the full extent consistent with law continue in full force and
effect, and it is the intention and desire of the parties that the court treat
any provisions of this Agreement which are not fully enforceable as having been
modified to the extent deemed necessary by the court to render them reasonable
and enforceable and that the

 

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court enforce them to such extent (for example, that the Restricted Period be
deemed to be the longest period permissible by law, but not in excess of the
length provided for in Section 6(c), and the Restricted Territory be deemed to
comprise the largest territory permissible by law under the circumstances).

(e)       Return of Company Materials upon Termination. Employee acknowledges
that all records, documents, and Tangible Embodiments containing or of
Proprietary Information prepared by Employee or coming into his possession by
virtue of his employment by the Company are and will remain the property of the
Company. Upon termination of his employment with the Company, Employee shall
immediately return to the Company all such items in his possession and all
copies of such items.

7.         Equitable Remedies.

 

(a)       Employee acknowledges and agrees that the agreements and covenants set
forth in Sections 6(a), (b), (c), (d) and (e) are reasonable and necessary for
the protection of the Company’s business interests, that irreparable injury will
result to the Company if Employee breaches any of the terms of said covenants,
and that in the event of Employee’s actual or threatened breach of any such
covenants, the Company will have no adequate remedy at law. Employee accordingly
agrees that, in the event of any actual or threatened breach by him of any of
said covenants, the Company will be entitled to immediate injunctive and other
equitable relief. Nothing in this Section 7 will be construed as prohibiting the
Company from pursuing any other remedies available to it for such breach or
threatened breach, including the recovery of any damages that it is able to
prove. Employee agrees that notwithstanding the arbitration provision in Section
13, the Company may apply to a court of competent jurisdiction, in accordance
with Section 13(c) of this Agreement, to obtain the equitable relief referenced
in this Section 6.

(b)       Each of the covenants in Sections 6(a), (b), (c), (d) and (e) will be
construed as independent of any other covenants or other provisions of this
Agreement.

(c)       In the event of any judicial determination that any of the covenants
in Sections 6(a), (b), (c), (d), and (e) are not fully enforceable, it is the
intention and desire of the parties that the court treat said covenants as
having been modified to the extent deemed necessary by the court to render them
reasonable and enforceable, and that the court enforce them to such extent.

8.         Release of Claims and Agreement Not to Sue.

(a)       General Release. As a condition of receiving the payment set forth in
Section 3, Employee releases and discharges the Company, and each of its
respective past, present and future shareholders, officers, directors,
employees, agents, insurers, attorneys and parent, affiliated or related
entities, and their respective successors and assigns (“Released Parties”), from
all claims, demands, actions, rights, damages, costs, losses, expenses,
compensation and other legal responsibilities, known or unknown, of any kind,
which Employee may own or hold against any of the Released Parties at any time
up to the Effective Date of this Agreement. The rights and claims released by
this

 

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Agreement include, but are not limited to, all claims of whatever kind or nature
that may exist relating to, arising out of or in connection with Employee’s
employment or the termination of such employment, whether such claims are
presently known or are hereafter discovered or whether they are foreseen or
unforeseen as of the date hereof. This release applies, without limitation, to
any and all claims for employment discrimination, harassment or retaliation
under Title VII of the Civil Rights Act of 1964, as amended, the Age
Discrimination in Employment Act (including the Older Worker Benefit Protection
Act); the Fair Labor Standards Act, the Family and Medical Leave Act, the
Employee Retirement Income Security Act, the Workers Adjustment and Retraining
Notification Act; the Sarbanes-Oxley Act, the California Fair Employment &
Housing Act, the Americans with Disabilities Act of 1990, the California Labor
Code, the California Health & Safety Code, the New York Human Rights Law, the
New York City Human Rights Laws, the New York Aids Testing Confidentiality Act,
the New York Equal Pay Law, the New York Persons With Disabilities Law, Civil
Rights Law, the New York Genetic Testing Confidentiality Law, the New York
Nondiscrimination Against Genetic Disorders Law, the New York Smokers Rights
Law, the New York Equal Rights Law, the New York Discrimination by Employment
Agencies Law, the New York Bone Marrow Leave Law, the New York Adoptive Parents
Child Care Leave Law, the New York Cancer Victim Bias Law,Article 1, Section 11
of the New York State Constitution; N.Y. Workers’ Compensation Law, or any other
state, federal or local statute or regulation applicable to the Company,
including any claim for intentional or negligent infliction of emotional
distress, physical injury, violation of any public policy, breach of any implied
or express contract, any claim for stock options, any claim for wrongful
termination, fraud, intentional or negligent misrepresentation, and all other
legal and equitable causes of action whatsoever and all remedies for such
claims. The release of claims made by Employee in this Agreement does not apply
to claims that arise on or after the Effective Date of this Agreement. Employee
certifies that as of the date of this Release, he has reported all accidents,
injuries or illnesses relating to or arising from his employment with the
Company. This release also does not apply to any claims of indemnity, statutory,
contractual, or otherwise, which Employee may have as an employee of the
Company.

(b)       Unknown Claims. Employee understands that the release set forth in
Section 8(a) includes claims which Employee knows about and those Employee may
not know about. Employee expressly waives any rights under California Civil Code
Section 1542 which provides as follows:

“A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release which
if known by him or her must have materially affected his or her settlement with
the debtor.”

For purposes of Section 1542, “creditor” refers to the Company and “debtor”
refers to the Released Parties.

(c)       Agreement Not to Sue and Warranty. Employee promises that he has not
and will not file any suit, charge, complaint, grievance, action or other
proceeding

 

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with any federal, state or local agency, court, organization, judicial forum or
other tribunal asserting any claim that is released in Section 8(a), and
warrants that he has not assigned to any other person or entity the right to
file any claims that are released in Section 8(a), nor will he permit any
person, group of persons, or organization to take such action on his behalf.

(d)       Right to Review and Revoke the Agreement. Employee acknowledges that
he has been advised by and consulted his attorney, that he has had a reasonable
period of time in which to consider the terms of this General Release, and he
has specifically consulted (or has the opportunity to consult) his attorneys
regarding this General Release and all of its terms. Employee acknowledges that
he has been given twenty-one (21) days to consider the General Release set forth
in Section 8(a) and that he has been advised that he may revoke this General
Release within seven (7) days of his execution. Revocation shall be made by
delivering a written notice of revocation to Travelzoo Inc., Attention: HR
Department, 590 Madison Avenue, 37th Floor, New York, NY 10022.For the
revocation to be effective, written notice must be actually received at the
designated address no later than the close of business on the seventh calendar
day after Employee signs this Agreement. If Employee revokes this General
Release, it shall not be effective or enforceable and Employee will not receive
the payment described Section 3. Employee hereby acknowledges that his execution
of this Agreement containing the General Release is made knowingly, and that he
has been advised of and afforded the proper time for consideration and
revocation of the General Release, as specified by the Older Worker Benefit
Protection Act.

9.         Assignment. This Agreement shall be binding upon and inure to the
benefit of (a) the heirs, executors and legal representatives of Employee upon
Employee’s death and (b) any successor of the Company. Any such successor of the
Company shall be deemed substituted for the Company under the terms of this
Agreement for all purposes. As used herein, “successor” shall include any
person, firm, corporation or other business entity which at any time, whether by
purchase, merger or otherwise, directly or indirectly, acquires all or
substantially all of the assets or business of the Company. None of the rights
of Employee to receive any form of compensation payable pursuant to this
Agreement shall be assignable or transferable except through a testamentary
disposition or by the laws of descent. Any attempted assignment, transfer,
conveyance or other disposition (other than as aforesaid) of any interest in the
rights of Employee to receive any form of compensation hereunder shall be null
and void.

10.       Notices. All notices, requests, demands and other communications
called for hereunder shall be in writing and shall be deemed given if delivered
personally, one (1) day after mailing via Federal Express overnight or a similar
overnight delivery service, or three (3) days after being mailed by registered
or certified mail, return receipt requested, prepaid and addressed to the
parties or their successors in interest at the addresses listed above, or at
such other addresses as the parties may designate by written notice in the
manner aforesaid.

11.       Severability. In the event that any provision hereof becomes or is
declared by a court of competent jurisdiction to be illegal, unenforceable or
void, this Agreement shall continue in full force and effect without said
provision.

 

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12.       Entire Agreement. This Agreement represents the entire agreement and
understanding between the Company and Employee concerning Employee’s employment
relationship with the Company, and supersedes in their entirety any and all
prior agreements and understandings concerning Employee’s employment
relationship with the Company, including without limitation the Prior Agreement
and any amendments thereto. This Agreement also supersedes any Company Employee
Handbook, to the extent its terms may differ from those of the Handbook.

12.       Resolution of Disputes Regarding Employment.

 

(a)       The Parties agree to submit any dispute or controversy arising out of,
relating to, or in connection with this Agreement, or the interpretation,
validity, construction, performance, breach, or termination thereof, or to any
aspect of the employer/employee relationship or the termination of that
relationship, to mediation. The Parties shall mutually select the mediator and
shall equally pay for the costs of the mediator.

(b)       If and only if a mediation is unsuccessful, and the dispute or
controversy is not resolved within 30 days after a mediation, either party may
submit the matter to binding arbitration, to the extent permitted by law, to be
held in or near San Jose, California in accordance with the National Rules for
the Resolution of Employment Disputes then in effect of the American Arbitration
Association (the “Rules”). The Company agrees to pay all costs of the arbitrator
and the arbitration. The arbitrator may grant injunctions or other relief in
such dispute or controversy. The decision of the arbitrator shall be final,
conclusive and binding on the parties to the arbitration. Judgment may be
entered on the arbitrator’s decision in any court having jurisdiction. The
arbitrator may award the prevailing party in any such arbitration attorneys’
fees and costs incurred in connection therewith, except for those the Company
shall bear, as set forth above.

(c)       The arbitrator shall apply California law to the merits of any dispute
or claim, without reference to rules of conflict of law. The Parties hereby
expressly consent to the personal jurisdiction of the state and federal courts
located in Santa Clara County, California or the Northern District of California
for any action or proceeding arising from or relating to this Agreement and/or
relating to any arbitration in which the Parties are participants.

(d)       The Parties have read and understand Section 13, which discusses
arbitration. The Parties understand that by signing this Agreement, the Parties
agree to submit any future claims arising out of, relating to, or in connection
with this Agreement, or the interpretation, validity, construction, performance,
breach, or termination thereof to binding arbitration to the extent permitted by
law, and that this arbitration clause constitutes a waiver of the Parties’ right
to a jury trial and relates to the resolution of all disputes relating to all
aspects of the employer/employee relationship, including but not limited to, the
following claims:

 

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(i)        Any and all claims for wrongful discharge of employment; breach of
contract, both express and implied; breach of the covenant of good faith and
fair dealing, both express and implied; negligent or intentional infliction of
emotional distress; negligent or intentional misrepresentation; negligent or
intentional interference with contract or prospective economic advantage;
misappropriation of Proprietary Information or other breaches covenants set
forth in Section 6, and defamation;

(ii)       Any and all claims for violation of any federal, state or municipal
statute, including, but not limited to the California Fair Employment and
Housing Act, the Civil Rights Act of 1991, the Age Discrimination in Employment
Act of 1967, the Americans with Disabilities Act of 1990, and the Fair Labor
Standards Act;

(iii)      Any and all claims arising out of any other laws and regulations
relating to employment or employment discrimination.

(e)       The Parties may apply to any court of competent jurisdiction for a
temporary restraining order, preliminary injunction, or other interim or
conservatory relief, as necessary, without breach of this arbitration agreement
and without abridgment of the powers of the arbitrator.

14.       No Oral Modification, Cancellation or Discharge. This Agreement may
only be amended, canceled or discharged in writing signed by Employee and the
Company.

15.       Governing Law. This Agreement shall be governed by the laws of the
State of California.

16.       Acknowledgment. Employee acknowledges that he has had the opportunity
to discuss this matter with and obtain advice from his private attorney, has had
sufficient time to, and has carefully read and fully understands all the
provisions of this Agreement, and is knowingly and voluntarily entering into
this Agreement.

IN WITNESS WHEREOF, the undersigned have executed this Agreement on the
respective dates set forth below.

 

THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY BE ENFORCED BY
BOTH PARTIES. EMPLOYEE ACKNOWLEDGES THAT HE HAS HAD AN ADEQUATE OPPORTUNITY TO
REVIEW THIS AGREEMENT AND ALL OF ITS TERMS AND IS ENTERING INTO IT VOLUNTARILY
ON THE DATE SHOWN BELOW HIS NAME. HE HAS CAREFULLY READ THIS AGREEMENT AND
UNDERSTANDS ALL OF ITS TERMS INCLUDING THE FULL AND FINAL RELEASE OF CLAIMS SET
FORTH ABOVE. HE FURTHER ACKNOWLEDGES THAT HE HAS VOLUNTARILY ENTERED INTO THIS
AGREEMENT, THAT HIS AGREEMENT IS NOT THE RESULT OF ANY FRAUD, DURESS, COERCION,
PRESSURE OR UNDUE INFLUENCE EXERCISED BY OR ON BEHALF OF THE COMPANY, THAT HE
HAS NOT

 

14

 

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RELIED UPON ANY REPRESENTATION OR STATEMENT, WRITTEN OR ORAL, NOT SET FORTH IN
THIS AGREEMENT, AND THAT HE HAS HAD THIS AGREEMENT REVIEWED BY HIS ATTORNEY AND
HIS TAX ADVISOR, OR HAS BEEN GIVEN THE OPPORTUNITY BY THE COMPANY TO DO SO.

 

TRAVELZOO INC.

 

MAX RAYNER

 

 

 

 

 

By:

/s/ Ralph Bartel

 

By:

/s/ Max Rayner

 

 

 

 

 

Title:

Chairman of the Board

 

Date:

September 1, 2009

 

 

 

 

 

Date:

September 1, 2009

 

 

 

 

 

 

15

 

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EXHIBIT A

PERSONAL INTELLECTUAL PROPERTY

A.

A potential Method/Process patent or publication on the use of specific data
replication techniques to provide disaster recovery and business continuance
with minimum data loss.

 

B.

A potential patent or publication elucidating quantified best practices for
tying business requirements to optimal cost effectiveness of technical solutions
in enterprise computing and service oriented architectures.

 

C.

An enterprise infrastructure management framework capable of maintaining both
operational control and a complete map of component/service relationships.

 

D.

A flexible system clustering framework ranging from basic capabilities such as
device driver sharing to a single system image across nodes.

 

E.

A software-as-a-service system seeking to instantiate key corporate
transactional, process and knowledge needs as a “company-in-a-box”.

 

 

 

 

__________________________________

[Employee]

 

TRAVELZOO INC.

 

By:_______________________________

Print Name: ________________________

Title:______________________________

 

 

__________________________________

Date Signed

 

 

__________________________________

Date Signed

 

 

 

--------------------------------------------------------------------------------

EXHIBIT B

OUTSIDE RELATIONSIPS / BOARDS

Company reserves the right to reasonably withdraw approval for one or more of
these relationships if they should prove to affect the ability of Employee to
fully perform his duties and responsibilities.

 

A.

Advisor: Rootstock Software, a company focused on manufacturing/MRP software.

Compensation: Shares and the opportunity to participate as an early investor.

 

B.

Non-executive Board Chairman: Citrusleaf, a startup targeting high performance
data caches/key-value stores.

Compensation: When defined it will be in the form of stock rights.

 

C.

Advisor/Angel investor: Potential startup targeting enterprise infrastructure
management and flexible system clustering frameworks. (See Exhibit A, items C
and D)

Compensation: When defined it will be in the form of stock rights.

 

 

 

 

 

__________________________________

[Employee]

 

TRAVELZOO INC.

 

By:_______________________________

Print Name: ________________________

Title:______________________________

 

 

__________________________________

Date Signed

 

 

__________________________________

Date Signed

 

 

 

 

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EXHIBIT C

BENEFICIARIES

 

Beneficiary:

Michelle M. Chen, spouse

 

xxxx xxxxxxxxxxxxxxx, Palo Alto, CA xxxxxxx

 

Contingent Beneficiary:

The Rayner-Chen Living Trust

 

Retained for safekeeping by Robert K. Roskoph,

 

Roskoph Associates Professional Corporation

 

xxxx xxxxxxxxxx, Palo Alto, California xxxxx

 

Phone: (xxx) xxx-xxxx