Exhibit 10.1

SECURITIES PURCHASE AGREEMENT
by and among
TRAVELZOO (EUROPE) LIMITED,
and
TRAVELZOO (ASIA PACIFIC) INC.
Dated August 20, 2015

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TABLE OF CONTENTS
 
 
Page

ARTICLE I DEFINITIONS
1

 
 
 
1.1
Definitions    
1

 
 
 
ARTICLE II PURCHASE AND SALE
8

 
 
 
2.1
Sale of the Purchased Securities
8

 
 
 
2.2
Purchase Price    
8

 
 
 
2.3
Closing
8

 
 
 
2.4
Closing Deliverables
8

 
 
 
2.5
Purchase Price Adjustment
9

 
 
 
2.6
Taxes
11

 
 
 
2.7
Further Assurances
12

 
 
 
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER
12

 
 
 
3.1
Existence and Power
12

 
 
 
3.2
 Valid and Enforceable Agreement; Authorization
13

 
 
 
3.3
Tax Matters
13

 
 
 
3.4
Litigation
14

 
 
 
3.5
Capitalization; Subsidiaries
14

 
 
 
3.6
Securities Ownership
15

 
 
 
3.7
Financial Statements
15

 
 
 
3.8
Condition of Real and Personal Property
16

 
 
 
3.9
Contracts
16

 
 
 
3.10
Licenses and Permits
16

 
 
 
3.11
Compliance with Laws
17

 
 
 
3.12
Employee and Labor Matters
17

 
 
 
3.13
Intellectual Property Matters
17

 
 
 
3.14
Employee Benefit Plans
19

 
 
 
3.15
Intentionally Omitted
20

 
 
 
3.16
Insurance
20

 
 
 
3.17
Transactions with Affiliates
20

 
 
 
3.18
Brokers
20

 
 
 
3.19
No Other Representations or Warranties
20

 
 
 

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ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER
20

 
 
 
4.1
Existence and Power
21

 
 
 
4.2
Valid and Enforceable Agreement; Authorization
21

 
 
 
4.3
Brokers
21

 
 
 
4.4
Litigation
21

 
 
 
4.5
No Knowledge of Breach of Seller Representation
21

 
 
 
4.6
No Other Representations or Warranties
21

 
 
 
ARTICLE V ADDITIONAL COVENANTS OF THE PARTIES
22

 
 
 
5.1
Books and Records
22

 
 
 
5.2
Confidentiality; Announcements
22

 
 
 
5.3
Advertiser and Subscriber Information
22

 
 
 
5.4
Cooperation; Further Assurances
23

 
 
 
5.5
Financial Statements
23

 
 
 
5.6
Termination of Certain Agreements
24

 
 
 
5.7
Non-Competition; Non-Solicitation
24

 
 
 
ARTICLE VI INDEMNIFICATION
25

 
 
 
6.1
Indemnification by Seller
25

 
 
 
6.2
Indemnification by Buyer
25

 
 
 
6.3
Notice and Payment of Losses
26

 
 
 
6.4
Defense of Third-Party Claims
26

 
 
 
6.5
Survival of Representations and Warranties
27

 
 
 
6.6
Limitation on Indemnification
27

 
 
 
6.7
Payments
28

 
 
 
6.8
Right of Offset;Escrow
29

 
 
 
6.9
Characterization of Indemnity Payments
29

 
 
 
6.10
Exclusive Remedy
29

 
 
 
ARTICLE VII MISCELLANEOUS PROVISIONS
29

 
 
 
7.1
Notice
29

 
 
 
7.2
Entire Agreement
30

 
 
 
7.3
Severability
31

 
 
 
7.4
Assignment; Binding Agreement
31

 
 
 
7.5
Expenses
31

 
 
 
7.6
Counterparts
31

 
 
 
7.7
Headings; Interpretation
31

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7.8
Governing Law
32

 
 
 
7.9
Arbitration
32

 
 
 
7.10
Disclosure Generally
32

 
 
 
7.11
No Third Party Beneficiaries or Other Rights
32

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SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT is entered into as of this 20th day of
August, 2015, by and between TRAVELZOO (EUROPE) LIMITED, a corporation organized
under the Laws of the United Kingdom (“Buyer”) and TRAVELZOO (ASIA PACIFIC)
INC., a Cayman Islands corporation (“Seller”). Buyer and Seller each referred to
as a “Party” and collectively as the “Parties”. Capitalized terms are defined in
Article I.
RECITALS
A.Seller is the owner of one hundred percent (100%) of the issued and
outstanding Capital Securities of Travelzoo (Asia) Limited, a Hong Kong company
(“Travelzoo Asia”) and Travelzoo Japan K.K., a Japanese kabushiki kaisha
(“Travelzoo Japan” and together with Travelzoo Asia, the “Companies” and each a
“Company”);
B.The Buyer desires to purchase one hundred percent (100%) of the Capital
Securities of the Companies held by Seller (the “Purchased Securities”), on the
terms and conditions set forth herein; and
C.Seller desires to sell the Purchased Securities to Buyer, on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
covenants, representations, warranties, conditions, and agreements hereinafter
expressed, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Parties agree as follows:

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ARTICLE I
DEFINITIONS
1.1     Definitions. Without limiting the effect of any other terms defined in
the text of this Agreement, the following words shall have the meaning given
them in this Article I:
“Accounting Firm” shall have the meaning set forth in Section 2.5(c).
“Affiliate” means, with respect to any Person, any Person which is controlling,
controlled by, or under common control with, directly or indirectly through any
Person, the Person referred to, and, if the Person referred to is a natural
person, any member of such Person’s immediate family. The term “control”
(including, with correlative meaning, the terms “controlled by” and “under
common control with”) as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities, by contract or otherwise.
“Agreement” means this Agreement as executed on the date hereof and as amended
or supplemented in accordance with the terms hereof, including all Schedules and
Exhibits hereto, as attached hereto at the time of signing and as subsequently
updated or amended in accordance with the terms hereof.
“Audited Financials” has the meaning set forth in Section 5.5.
“Business Day” means any day which is not a Saturday, Sunday or a legal holiday
in the State of New York, United States of America.
“Buyer” has the meaning set forth in the preamble.
“Buyer Parties” has the meaning set forth in Section 6.1.
“Capital Securities” means, with respect to any Person, all shares, interests,
participations or other equivalents (however designated, whether voting or
non-voting) of such Person’s capital, including common shares or preferred
shares in a corporation, membership interests in a limited liability company,
limited or general partnership interests in a partnership or any other
equivalent of such ownership interest.
“Client Information” has the meaning set forth in Section 5.3(a).
“Closing” has the meaning set forth in Section 2.3.
“Closing Balance Sheet” has the meaning set forth in Section 2.5(a).
“Closing Date” has the meaning set forth in Section 2.3.
“Closing Date Net Working Capital” has the meaning set forth in Section 2.5(a).

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“Closing Date Payment” has the meaning set forth in Section 2.2(b).
“Code” means the United States Internal Revenue Code of 1986, as amended.
“Company” and “Companies” have the meanings set forth in the recitals.
“Company Licensed IP Rights” has the meaning set forth in Section 3.13(a).
“Company Owned IP Rights” has the meaning set forth in Section 3.13(a).
“Company Plan” has the meaning set forth in Section 3.14(a).
“Constituent Documents” means, relative to a Person that is not a natural
person, its certificate of incorporation, bylaws, certificate of partnership,
partnership agreement, certificate of formation, limited liability company
agreement, operating agreement and all shareholder agreements, voting trusts and
similar arrangements applicable to any of such entity’s capital securities; in
each of the foregoing cases, to which such Person is a party or bound.
“Contract” means any contract, agreement, lease, indenture, mortgage, deed of
trust, evidence of indebtedness, binding commitment or instrument.
“Contractors” has the meaning set forth in Section 3.12(b).
“Deferred Payment” has the meaning set forth in Section 2.2(a)(ii).
“Disclosure Schedule(s)” means the disclosure schedules delivered by Seller to
Buyer on the date hereof and the schedules delivered by Buyer to Seller on the
date hereof, as applicable.
“Disputed Items and Amounts” has the meaning set forth in Section 2.5(b).
“Effective Time” means the effective time of the Closing, which shall be deemed
to be as of 11:59 p.m. New York time on the Closing Date.
“Employee” has the meaning set forth in Section 3.12(a).
“Encumbrances” means mortgages, liens, charges, claims, security interests,
easements or other encumbrances.
“Escrow Agreement” has the meaning set forth in Section 6.8.
“Example Statement of Net Working Capital” means the statement of the aggregate
value of certain of the current assets of the Companies less the aggregate value
of certain of the current liabilities of the Companies, in each case, determined
on a consolidated basis without duplication as of the close of business on March
31, 2015 determined in accordance with the methodology set forth on Exhibit A
annexed hereto.
“Final Net Working Capital” has the meaning set forth in Section 2.5(d).

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“Financial Statements” has the meaning set forth in Section 5.5.
“Fundamental Representations” has the meaning set forth in Section 6.5.
“GAAP” means generally accepted accounting principles in the United States.
“Historic Quarterly Financials” has the meaning set forth in Section 5.5.
“Indemnifying Party” has the meaning set forth in Section 6.3.
“Indemnity Basket” has the meaning set forth in Section 6.6(a).
“Indemnity Cap” has the meaning set forth in Section 6.6(c).
“Injured Party” has the meaning set forth in Section 6.3.
“Insurance Policies” has the meaning set forth in Section 3.16.
“Intellectual Property” means patents, inventions, designs, models, know-how,
trade secrets, trademarks, trade dress, service marks, copyrights, business
names, source codes, domain names and other material business identifiers,
registrations and applications and all renewals of the foregoing and rights to
apply for any of the foregoing, and all the goodwill associated therewith, and
rights to sue or take any other action with respect to any past or future
infringement, misappropriation, dilution or other violation of any rights with
respect to the foregoing. This term does not include non-proprietary
information, know-how or processes otherwise available to the industry or
public, or rights obtained pursuant to licenses associated with software and
other intellectual property generally made available for purchase or use by
industry or the public.
“IRS” means the United States Internal Revenue Service.
“JAMS” has the meaning set forth in Section 7.9.
“Latest Balance Sheet” has the meaning set forth in Section 5.5.
“Law” or “Laws” means any statute, law, ordinance, decree, order, injunction,
rule, directive, or regulation of any government or quasi-governmental authority
located anywhere in the world, and includes, but is not limited to, United
States federal and state securities laws and the rules and regulations of any
regulatory or self-regulatory authority compliance with which is required by
law, in effect on the date hereof.
“Loss” or “Losses” means each and all of the following items to the extent
actually paid or incurred: losses, liabilities, damages, judgments, fines,
costs, penalties, amounts paid in settlement and reasonable out-of-pocket costs
and expenses incurred in connection therewith (including, without limitation,
costs and expenses of suits and proceedings, and reasonable fees and
disbursements of counsel).

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“Material Adverse Effect” means a material adverse effect on the assets,
business, financial condition or results of operations of the Companies taken as
a whole.
“Material Contracts” has the meaning set forth in Section 3.9(a).
“Net Working Capital” means the aggregate value of the current assets of the
Companies less the aggregate value of the current liabilities of the Companies,
in each case, determined on a consolidated basis without duplication as of the
Effective Time and calculated in accordance with the accounting judgments,
estimates, methodologies, practices, policies and procedures applied in
preparing the Example Statement of Net Working Capital (including by (i)
including only current assets and current liabilities to the extent that such
assets and liabilities are of the type and kind included in the Example
Statement of Net Working Capital and (ii) establishing levels of reserves in the
same manner as such reserves were established in preparing the Example Statement
of Net Working Capital).
“Notice of Claim” has the meaning set forth in Section 6.3.
“Notice of Dispute” has the meaning set forth in Section 2.5(b).
“Ordinary Course” means the ordinary course of commercial operations customarily
engaged in by the Company and its Subsidiaries, consistent with past or current
practice.
“Party” has the meaning set forth in the preamble.
“Payment Option” has the meaning set forth in Section 6.7.
“Person” means an individual, general or limited partnership, corporation
(including any nonprofit corporation), business trust, limited liability
company, limited liability partnership, joint stock company, estate, trust,
association, organization, unincorporated association, joint venture or other
entity.
“Personal Information” has the meaning set forth in Section 3.13(f).
“Permitted Encumbrances” means, collectively, (a) Encumbrances that are
disclosed in the Disclosure Schedules, (b) liens for Taxes, fees, levies, duties
or other governmental charges of any kind which are not yet delinquent or are
being contested in good faith by appropriate proceedings, (c) liens for
mechanics, materialmen, laborers, employees, suppliers or similar liens arising
by operation of Law which are not material to the Company taken as a whole, (d)
rights or liens of any lessors with respect to any of the leased real property
or leased personal property and (e) in the case of real property, and only to
the extent such items do not materially and adversely impact the operation of
such real property in the Ordinary Course, any matters, restrictions, covenants,
conditions, limitations, rights, rights of way, encumbrances, encroachments,
reservations,

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easements, agreements and other matters of record, such state of facts of which
an accurate survey or inspection of the property would reveal, and the
provisions of any Law.
“Post-Closing Periods” means all taxable periods of the Company commencing after
the Effective Time and the portion of any Straddle Period ending after the
Effective Time.
“Pre-Closing Periods” means all taxable periods of the Company ending on or
before the Effective Time and the portion of any Straddle Period commencing
prior to the Effective Time.
“Primary Unaudited Financials” has the meaning set forth in Section 5.5.
“Privacy Policy” has the meaning set forth in Section 3.13(f).
“Promissory Note” means that certain secured promissory note, dated as of the
Closing Date, made by Buyer in favor of Seller, in the form attached as Exhibit
B hereto.
“Purchase Price” has the meaning set forth in Section 2.2.
“Purchased Securities” has the meaning set forth in the preamble.
“Records” has the meaning set forth in Section 5.1.
“Representatives” means directors, officers, employees, Affiliates, investment
bankers, attorneys, accountants and other advisors or representatives.
“Restricted Business” means any Person engaged in the business of advertising,
selling or otherwise publishing travel and/or entertainment offers from various
third party providers by means of the internet, email newsletter and alert
services and similar media.
“Restricted Period” has the meaning set forth in Section 5.7(a).
“Review Period” has the meaning set forth in Section 2.5(b).
“Right of Offset” has the meaning set forth in Section 6.8.
“Rights” means, with respect to any Person, (a) securities, options, warrants,
puts, calls, agreements (by conversion, exchange, exercise or otherwise),
obligations, conversion or exchange rights, preemptive rights, rights of first
refusal, redemption rights, repurchase rights, plans, “tag-along” or
“drag-along” rights, commitments, agreements, arrangements or undertakings
(i) obligating such Person or any of its Affiliates to issue, deliver, redeem,
purchase or sell or otherwise transfer, or cause to be issued, delivered,
redeemed, purchased or sold or otherwise transferred, any Capital Securities, of
such Person or any of its Affiliates or any securities or obligations
convertible or exchangeable into or exercisable for, any Capital Securities,
(ii) giving any Person a right to subscribe for or acquire any Capital
Securities, or (iii) obligating such Person or any of its Affiliates to issue,
grant, adopt or enter into any such right; or (b) stock appreciation,

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phantom stock, profit participation or similar rights with respect to the
Capital Securities, of such Person.
“SEC” has the meaning set forth in Section 3.7(b).
“Seller” has the meaning set forth in the preamble.
“Seller’s knowledge” means the actual knowledge of each of the individuals set
forth in Section 1.1 of the Disclosure Schedules and the knowledge such
individual would reasonably be expected to obtain in the course of diligently
performing his duties for the Companies.
“Seller Parties” has the meaning set forth in Section 6.2.
“Shares” has the meaning set forth in Section 3.5(a).
“Straddle Period” means any taxable period of Seller that begins before and ends
after the Effective Time.
“Subsidiary” or “Subsidiaries” means, with respect to any Person, any
corporation, limited liability company, partnership, association, or other
business entity of which (i) if a corporation, a majority of the total voting
power of shares of stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers, or trustees thereof
is at the time owned or controlled, directly or indirectly, by such Person or
one or more of the other Subsidiaries of such Person or a combination thereof or
(ii) if a limited liability company, partnership, association, or other business
entity (other than a corporation), a majority of the partnership or other
similar ownership interests thereof is at the time owned or controlled, directly
or indirectly, by such Person or one or more Subsidiaries of such Person or a
combination thereof and for this purpose, a Person or Persons own a majority
ownership interest in such a business entity (other than a corporation) if such
Person or Persons shall be allocated a majority of such business entity’s gains
or losses or shall be a, or control any, managing director or general partner of
such business entity (other than a corporation). The term “Subsidiary” shall
include all Subsidiaries of such Subsidiary. For the avoidance of doubt, each of
Shanghai Travelzoo International Service Co. Ltd., Travelzoo (Shanghai) Media
Co. Ltd., and Beijing Travelzoo Travel Information Technology Limited shall be
deemed to be Subsidiaries of the Companies for all purposes in this Agreement.
“Target Net Working Capital” means Negative Five Million Nine Hundred Fifty
Eight Thousand Two Hundred Forty Seven dollars (-$5,958,247).
“Tax” or “Taxes” means all material taxes, charges, fees, levies, or other like
governmental assessments including, without limitation, all material federal,
possession, state, city, county and foreign (or governmental unit, agency, or
political subdivision of any of the foregoing) income, profits, employment
(including unemployment insurance and employee income tax withholding),
franchise, gross receipts, sales, use, transfer, stamp, occupation, property,
capital, severance,

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premium, windfall profits, tariff, customs, duties, ad valorem, value-added and
excise taxes, and any other governmental charges of the same or similar nature;
and all penalties, additions to tax and interest relating to any such taxes,
premiums or charges. Any one of the foregoing Taxes shall be referred to
sometimes as a “Tax”.
“Tax Returns” means all returns, reports, estimates, declarations, claims for
refund, information returns or statements relating to, or required to be filed
in connection with any Taxes, including any schedule or attachment thereto, and
including any amendment or supplement thereof.
“Terminated Contracts” has the meaning set forth in Section 5.6.
“Territory” means all countries located in those time zones that are more than
five (5) hours ahead of Greenwich Mean Time, based on Standard time, including,
without limitation, India and Pakistan, but excluding Russia.
“Transactions” means the transactions contemplated by this Agreement.
“Travelzoo” means Travelzoo Inc., a Delaware corporation.
“Travelzoo Asia” has the meaning set forth in the recitals.
“Travelzoo Asia Shares” has the meaning set forth in Section 3.5(a).
“Travelzoo Japan” has the meaning set forth in the recitals.
“Travelzoo Japan Shares” has the meaning set forth in Section 3.5(a).
“Unaudited Annual Balance Sheets” has the meaning set forth in Section 5.5.
“Unaudited Financials” has the meaning set forth in Section 5.5.
“Unaudited Income Statement” has the meaning set forth in Section 5.5.
ARTICLE II
PURCHASE AND SALE
2.1     Sale of the Purchased Securities. Subject to the terms and conditions of
this Agreement, Seller agrees to sell, assign, transfer and deliver to Buyer on
the Closing Date, and Buyer agrees to purchase from Seller on the Closing Date,
the Purchased Securities, free and clear of any and all Encumbrances as of the
Closing Date. All certificates representing the Purchased Securities shall be
duly endorsed to Buyer by Seller, with all necessary transfer tax and other
revenue stamps affixed and cancelled.
2.2 Purchase Price.

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(a)    Components of the Purchase Price. As full and total consideration for the
purchase by Buyer of the Purchased Securities from Seller, the aggregate
purchase price (the “Purchase Price”) shall be the sum of:
(i)    the Closing Date Payment (as the same may be adjusted pursuant to Section
2.5); and
(ii)    Five Million Six Hundred Fifty Seven Thousand Seven Hundred Fifty
dollars ($5,657,750), payable in accordance with terms of the Promissory Note
(the “Deferred Payment”), subject to Buyer’s Right of Offset.
(b)    Payment of the Purchase Price. At the Closing, Buyer shall pay to Seller
an amount equal to the sum of Sixteen Million Nine Hundred Seventy Three
Thousand Two Hundred Fifty Dollars ($16,973,250) (the “Closing Date Payment”),
by wire transfer in readily available funds as set forth in Section 2.2(b) to
Seller pursuant to the wire transfer instructions set forth in Section 2.2(b) of
the Disclosure Schedules, or such other account or accounts as Seller may direct
by written notice to Buyer given pursuant to this Agreement.
2.3 Closing. The closing of the Transactions (the ”Closing”) shall take place
concurrently with the execution and delivery of this Agreement (the date of this
Agreement being referred to herein as the “Closing Date”).
2.4 Closing Deliverables.
(a)     Seller Deliveries to Buyer. At Closing, Seller shall deliver or cause to
be delivered to Buyer:
(i)    evidence, in form and substance reasonably satisfactory to Buyer, of the
transfer and sale to Buyer of the Purchased Securities, and the registration of
Buyer as the record and beneficial owner of such Purchased Securities in the
official books and records of the Companies;
(ii)    a certificate of the Secretary or equivalent officer of Seller
certifying that (A) attached thereto are (1) true and complete copies of all
Constituent Documents of the Companies and each of their respective
Subsidiaries, and (2) resolutions adopted by the board of directors of Seller
authorizing the execution, delivery and performance of this Agreement and the
consummation of the Transactions, and (B) all such Constituent Documents and
resolutions are in full force and effect; and
(iii)    such other documents, certificates, instruments and agreements as may
be reasonably requested by Buyer in connection with the Closing.

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(b)    Buyer Deliveries to Seller. At Closing, Buyer shall deliver or cause to
be delivered to Seller:
(i)    the Closing Date Payment by wire transfer of immediately available funds
to the account designated by Seller in accordance with this Agreement;
(ii)    the Promissory Note duly executed by Buyer;
(iii)    such other documents, certificates, instruments and agreements as may
be reasonably requested by Seller in connection with the Transaction.
2.5 Purchase Price Adjustment.
(a)     Promptly after the Closing Date, and in any event not later than sixty
(60) calendar days following the Closing Date, Buyer shall prepare, or cause to
be prepared, and deliver to Seller a balance sheet of the Companies on a
consolidated basis as of the Effective Time (the “Closing Balance Sheet”),
showing Buyer’s reasonably-detailed, good faith calculation of Net Working
Capital as of the Closing Date (the “Closing Date Net Working Capital”),
together with applicable documentation substantiating such calculation. The
Closing Date Net Working Capital shall be calculated in the same manner as Net
Working Capital.
(b)     Buyer shall permit Seller and its accountants to review promptly upon
request all accounting records, work papers and computations used by Buyer in
the preparation of such Closing Balance Sheet and the computation of Closing
Date Net Working Capital. If Seller disputes the Closing Date Net Working
Capital as calculated by Buyer, not more than thirty (30) calendar days after
the date Seller receives Buyer’s calculation thereof (the “Review Period”),
Seller shall deliver to Buyer a notice of its objection to the Closing Balance
Sheet (a “Notice of Dispute”), which shall specify those items and/or amounts in
Buyer’s calculation of the Closing Date Net Working Capital as to which Seller
disagrees, the basis for such disagreement and what Seller believes are, in each
instance, the appropriate amounts (collectively, the “Disputed Items and
Amounts”). Alternatively, the Closing Date Net Working Capital shall become
final and binding upon the Parties in the event that (i) prior to the end of the
Review Period, Seller accepts the Closing Date Net Working Capital by delivering
written notice thereof to Buyer, or (ii) Seller fails to give the Notice of
Dispute prior to the expiration of the Review Period. Buyer or Seller, as the
case may be, shall within five (5) Business Days of the date upon which the
Proposed Closing Date Calculations become final and binding in accordance with
the provisions of the immediately preceding sentence make the payment required
by Section 2.5(d).
(c)     Upon receipt of a Notice of Dispute, Buyer shall promptly consult with
Seller in good faith with respect to the Disputed Items and Amounts in an effort
to resolve the dispute. If any such dispute cannot be resolved by Buyer and
Seller within thirty (30) calendar days (or longer, as mutually agreed by the
Parties) after Buyer receives the Notice of Dispute, the Parties shall refer the
dispute to the Northern California office of McGladrey LLP (the “Accounting
Firm”), as an arbitrator to finally determine, as soon as practicable, and in
any event within twenty (20) calendar days after such reference, all points of
disagreement with respect to the calculation of the Net Working Capital. Buyer
and Seller shall cooperate with each other and the Accounting Firm in

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connection with the matters set forth in this Section 2.5, including by
furnishing such information as may be reasonably requested. Each of Buyer and
Seller shall afford the other Party the reasonable and unrestricted opportunity
to participate in all communications with the Accounting Firm. The Accounting
Firm shall decide only the Disputed Items and Amounts, and may not assign a
value to any item in dispute which is either higher or lower than the respective
calculations for such item submitted by the Parties. The Accounting Firm shall
apply the terms of Section 2.5 of this Agreement, and shall otherwise conduct
the arbitration under such procedures as the Parties may agree or, failing such
agreement, under then prevailing JAMS Comprehensive Arbitration Rules &
Procedures. All determinations by the Accounting Firm shall be final, conclusive
and binding with respect to the calculation of the Net Working Capital in the
absence of fraud or manifest error. The fees and expenses of the Accounting Firm
incurred pursuant to this Section 2.5 shall be borne pro rata as between the
Seller, on the one hand, and the Buyer, on the other hand, in proportion to the
final allocation made by such Accounting Firm of the Disputed Items and Amounts
weighted in relation to the claims made by the Seller and the Buyer, such that
the prevailing party pays the lesser proportion of such fees, costs and
expenses. For example, if the Buyer claims that the appropriate adjustments are,
in the aggregate, $1,000 greater than the amount determined by the Seller and if
the Accounting Firm ultimately resolves the dispute by awarding to the Buyer an
aggregate of $300 of the $1,000 contested, then the fees, costs and expenses of
the Accounting Firm will be allocated 30% (i.e., 300 ÷ 1,000) to the Seller and
70% (i.e., 700 ÷ 1,000) to the Buyer; provided, that such fees and expenses
shall not include, so long as a Party complies with the procedures of this
Section 2.5, the other Party’s outside counsel or accounting fees.
(d)     The Purchase Price shall be adjusted as follows, based on the Net
Working Capital as of the Closing Date as finally determined under this Section
2.5 (the “Final Net Working Capital”):
(i)    Seller shall pay to Buyer the amount, dollar for dollar, by which Final
Net Working Capital is less than Target Net Working Capital; and
(ii)    Buyer shall pay to Seller the amount, dollar for dollar, by which Final
Net Working Capital is greater than Target Net Working Capital; and
(iii)    In the event Final Net Working Capital is equal to Target Net Working
Capital, no adjustment to the Purchase Price shall be made.
Any payment so required to be made by Buyer or Seller pursuant to this Section
2.5 shall be by transfer of immediately available funds not more than five (5)
Business Days after final determination thereof; provided that any payment so
required to be made by Seller pursuant to this Section 2.5 may be satisfied, at
Buyer’s election upon written notice to Seller, by Buyer’s exercise of its Right
of Offset.
2.6 Taxes.
(a)     All customs, sales, use, value-added, gross receipt, registration, stamp
duty or other similar transfer Taxes incurred in connection with the transfer
and sale of the Purchased Securities as contemplated by the terms of this
Agreement, including all recording or filing fees,

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notarial fees and other similar costs of Closing, that may be imposed upon, or
payable, collectible or incurred, but excluding for the avoidance of doubt any
income Tax on the Purchase Price, shall be borne by the Buyer. The parties agree
to furnish or cause to be furnished to each other, upon request, as promptly as
practical, such information (including reasonable access to books and records)
and assistance as is reasonably necessary in an effort to allow the Parties to
minimize all such Taxes.
(b)     Except as provided in Section 2.6(a), any Taxes with respect to the
Companies or their respective Subsidiaries for any Pre-Closing Periods,
including any Taxes required to be withheld and paid in connection with the
payment of the Purchase Price, shall be borne by Seller, it being acknowledged
and agreed that Seller shall bear no additional responsibility for Taxes to the
extent such Taxes are (i) accrued or otherwise accounted for in the Final Net
Working Capital, or (ii) withheld by the Buyer in accordance with the terms of
this Agreement. The Buyer shall be responsible for any Taxes with respect to
Companies or their respective Subsidiaries for any Post-Closing Periods. All
Taxes collected by Seller from third parties prior to the Closing, including,
but not limited to, sales and use Taxes and all payroll withholding Taxes,
including both employee and employer portions, shall be paid by Seller to the
appropriate governmental authority.
(c)     Taxes covering any Straddle Period shall be pro-rated between Seller and
the Buyer based upon the number of days in the Straddle Period ending as of the
Effective Time and number of days in the Straddle Period ending after the
Effective Time, respectively. The portion of such Tax that relates to the
portion of such Tax period ending as of the Effective Time shall be deemed to be
the amount of such Tax for the entire Tax period multiplied by a fraction the
numerator of which is the number of days in the Tax period ending as of the
Effective Time and the denominator of which is the number of days in the entire
Tax period.
(d)     The Buyer and Seller agree to furnish or cause to be furnished to each
other, upon request, as promptly as practical, such information (including
reasonable access to books and records) and assistance as is reasonably
necessary for the filing of any Tax Return, the conduct of any Tax audit, and
for the prosecution or defense of any claim, suit or proceeding relating to any
Tax matter. The Buyer and Seller shall cooperate with each other in the conduct
of any Tax audit or other Tax proceedings and each shall execute and deliver
other documents as are reasonably necessary to carry out the intent of this
Section 2.6(d). Any Tax audit or other Tax proceeding shall be deemed to be a
third party claim subject to the procedures set forth in Section 6.4 of this
Agreement.
(e)     The Buyer shall promptly pay or shall cause prompt payment to be made to
Seller of all refunds of Taxes and interest thereon received by, or credited
against any Tax liability of the Buyer or any Affiliate of the Buyer
attributable to Taxes paid by Seller or its Affiliates with respect to any
Pre-Closing Period. Seller shall promptly pay or shall cause prompt payment to
be made to Buyer of all refunds of Taxes and interest thereon received by, or
credited against any Tax liability of Seller or any Affiliate of the Seller
attributable to Taxes paid by Buyer or its Affiliates with respect to any
Post-Closing Period.
(f)     Notwithstanding any provision to the contrary in this Agreement, the
Buyer shall be entitled to deduct and withhold from the Purchase Price such
amounts as the Buyer is required

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to deduct and withhold with respect to the payment of the Purchase Price under
the Code, or under any applicable provision of state, local, or non-U.S. Tax
law. To the extent that amounts are so withheld and paid over to the appropriate
governmental authority by the Buyer, such withheld amounts shall be treated for
all purposes of this Agreement as having been paid to the Seller in respect of
which such deduction and withholding was made by the Buyer.
2.7     Further Assurances. From and after the Closing, the Parties shall do
such acts and execute such documents and instruments as may be reasonably
required to make effective the Transactions.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby makes the representations and warranties set forth in this Article
III, each of which is true and correct as of the Closing Date, and which shall
survive the Closing Date and the Transactions to the extent set forth herein.
3.1 Existence and Power.
(a) Seller has the requisite power and authority to execute and deliver this
Agreement, to perform its obligations hereunder, and to consummate the
Transactions. Seller has the corporate power and authority to transfer the
Purchased Securities.
(b)     Seller is duly organized, validly existing and in good standing under
the Laws of the Cayman Islands. Each of the Companies and their respective
Subsidiaries is duly organized, validly existing and in good standing under the
Laws of its jurisdiction of formation.
(c)     None of Seller, the Companies or any Subsidiary of a Company is party
to, subject to or bound by any Contract, Encumbrance, Law or Constituent
Document that would (i) be breached or violated or its obligations thereunder
accelerated or increased (whether or not with notice or lapse of time or both)
in any material respect by the execution or delivery by it of this Agreement or
the performance by Seller of the Transactions, or (ii) prevent the carrying out
of the Transactions. Except as set forth in Section 3.1 of the Disclosure
Schedule or otherwise provided for herein, no permit, consent, waiver, approval
or authorization of, or declaration to or filing or registration with, any
governmental or regulatory authority or third party, is required in connection
with the execution, delivery or performance of this Agreement by Seller, or the
consummation by Seller of the Transactions, except for any such permits,
consents, waivers, approvals, authorizations, declarations, filings or
registrations the failure of which to make or obtain does not have and will not
have a Material Adverse Effect. The Transactions will not result in the creation
of any material Encumbrance against the Purchased Securities or any of the
properties, assets, or rights of the Companies or their respective Subsidiaries.
(d)     Each of Seller, the Companies and each Subsidiary of the Companies has
the power and authority to own, lease and use its assets and to transact the
business in which it is engaged, and holds all material authorizations,
franchises, licenses and permits required therefor.

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3.2     Valid and Enforceable Agreement; Authorization. This Agreement has been
duly executed and delivered by Seller, and constitutes a legal, valid and
binding obligation of Seller, enforceable against Seller in accordance with its
terms, except that such enforcement may be subject to (i) bankruptcy,
insolvency, reorganization, moratorium or other similar Laws affecting or
relating to enforcement of creditors’ rights generally, and (ii) general
principles of equity. The execution and delivery of this Agreement and the
consummation of the Transactions have been duly authorized, approved and
ratified by all necessary corporate action on the part of Seller.
3.3     Tax Matters. Except as set forth in Section 3.3 of the Disclosure
Schedules:
(a)     Each of Seller, and/or the Companies has prepared and duly filed (or has
had prepared and filed on its behalf) with the appropriate Tax Authority all Tax
Returns, required to be filed with respect to the Companies and their respective
Subsidiaries and has timely paid (or has had paid on its behalf) all Taxes shown
as due on such Tax Returns, including Taxes which any of Seller, the Companies
or any Subsidiary of a Company is obligated to withhold;
(b) None of Seller, the Companies or any Subsidiary of a Company is currently
the subject of a Tax audit or examination;
(c)     Each of Seller, the Companies and each Subsidiary of a Company, as
applicable, has withheld and paid all Taxes required to have been withheld and
paid in connection with amounts paid or owing to any employee, independent
contractor, creditor or other third party, and all required Tax Returns related
thereto have been properly completed and timely filed;
(d)     None of Seller, the Companies or any Subsidiary of a Company has
consented to extend the time, or is the beneficiary of any extension of time, in
which any Tax may be assessed or collected by any taxing authority (other than
any extension which is no longer in effect);
(e)     None of Seller, the Companies or any Subsidiary of a Company has
received from any Tax Authority any written notice of proposed adjustment,
deficiency, underpayment of Taxes which has not since been satisfied by payment
or been withdrawn;
(f)     None of Seller, the Companies or any Subsidiary of a Company (i) has
been a member of an affiliated group or filed or been included in a combined,
consolidated or unitary income Tax Return (other than any such Tax Return of
which Seller is the common parent), (ii) has any liability for Taxes of another
Person under Section 1.1502‑6 of the Treasury Regulations (or any similar
provision of state, local or foreign Law) or (iii) is a party to or bound by, or
liable for any Taxes as a result of, any Tax allocation or sharing agreement;
(g)     None of Seller, the Companies or any Subsidiary of a Company is party to
any income Tax allocation or sharing agreement;
(h)     None of Seller, the Companies or any Subsidiary of a Company is a party
to or has engaged in any transaction that, as of the date hereof, is a “listed
transaction” under Section 6707A(c)(2) of the Code or Section 1.6011-4(b)(2) of
the Treasury Regulations; and

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(i)     None of Seller, the Companies or any Subsidiary of a Company will be
required to include any item of income in, or exclude any item of deduction
from, taxable income for any taxable period (or portion thereof) ending after
the Closing Date as a result of (i) any change in method of accounting for a
Pre-Closing Period, or (ii) any “closing agreement,” as described in
Section 7121 of the Code (or any similar provision of state, local or foreign
income Tax Law).
3.4     Litigation. Except as set forth in Section 3.4 of the Disclosure
Schedules, there are no material actions, suits or proceedings pending or, to
Seller’s knowledge, threatened against Seller (in respect of the Companies), any
Company or any Subsidiary of a Company. None of Seller (in respect of the
Companies), any Company or any Subsidiary of a Company is subject to any order,
judgment, writ, injunction or decree of any court or governmental or regulatory
authority or body (excluding any such matters of general applicability or
applicable to entities situated similarly to Seller rather than to them
specifically).

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3.5 Capitalization; Subsidiaries.
(a)    The authorized Capital Securities of Travelzoo Asia consists solely of
ten thousand (10,000) ordinary shares (the “Travelzoo Asia Shares”), 10,000
shares of which are issued and outstanding, and all of which are beneficially
and of record owned by Seller. The authorized Capital Securities of Travelzoo
Japan consists solely of ten (10) shares (the “Travelzoo Japan Shares” and
together with the Travelzoo Asia Shares, the “Shares”)), ten (10) shares of
which are issued and outstanding, and all of which are beneficially and of
record owned by Seller. All of the issued and outstanding Shares have been duly
authorized and validly issued, are fully paid and non-assessable and were issued
in compliance with all applicable Laws.
(b)     There are no outstanding Rights, equity-based compensation arrangements
or commitments of any character to grant any Rights, to purchase or acquire from
any Company any of its Capital Securities.
(c)     The Companies have no obligation (contingent or otherwise) to purchase
or redeem any of their respective Capital Securities.
(d)     Except as set forth in Section 3.5(d) of the Disclosure Schedules, each
Company does not, directly or indirectly, own any Capital Securities of, or any
interest convertible into or exchangeable or exercisable for, at any time, any
Capital Securities of, any Person. Section 3.5(d) of the Disclosure Schedules
sets forth the name, owner and percentages of outstanding equity securities
owned, directly or indirectly, by any Company, with respect to each Person of
which such Company owns directly or indirectly, any Capital Securities. Except
as set forth in Section 3.5(d) of the Disclosure Schedules or as set forth in
its Constituent Documents, all outstanding equity securities of each Subsidiary
of a Company have been duly authorized and validly issued, are free and clear of
any Rights, or equity-based compensation arrangements or commitments of any
character to grant any Rights, and are owned, beneficially and of record, by a
Company or one if its wholly owned Subsidiaries. Except as set forth in Section
3.5(d) of the Disclosure Schedules, there are no outstanding (i) Capital
Securities of any Subsidiary of any Company, or (ii) Rights to acquire from any
Subsidiary of any Company, and no obligation of any Subsidiary of any Company to
issue, any Capital Securities or securities convertible into or exchangeable
for, at any time, Capital Securities of any Subsidiary of any Company.
3.6     Securities Ownership. Seller is the true and lawful record and
beneficial owner of the Purchased Securities. All of such Purchased Securities
have been duly and validly authorized and issued and are fully paid,
non-assessable and free of preemptive rights, with no personal liability
attaching to the ownership thereof, except as such liability may be imposed
pursuant to applicable Laws, and such ownership is free and clear of all
Encumbrances.

3.7     Financial Statements. The representations set forth in this Section 3.7
are made as of the date of the delivery of the Financial Statements, pursuant to
Section 5.5:
(a)     Except as set forth in Section 3.7(a) of the Disclosure Schedules, the
Financial Statements (i) have been prepared, at the request of Buyer, in
accordance with GAAP applied on a

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consistent basis throughout the periods covered thereby and (ii) fairly present,
in all material respects, the combined consolidated financial position of the
Companies as of the dates thereof and the consolidated results of operations and
cash flows for the periods then ended.
(b)    The Audited Financials have been prepared in a manner consistent with the
financial statements (including any notes thereto) filed by Travelzoo with the
Securities Exchange Commission (“SEC”) on Form 10-K for the fiscal year ended
December 31, 2014. The Audited Financials have been audited by an independent
registered accounting firm in accordance with GAAP. The Unaudited Financials
have been prepared in a manner consistent with the financial statements
(including any notes thereto) filed by Travelzoo with the SEC on Form 10-Q for
the period ended June 30, 2015. The Unaudited Financials have been reviewed by
an independent registered accounting firm.
(c)    There are no liabilities or obligations of the Companies, other than
liabilities or obligations (i) reflected and accrued for or reserved against in
the Latest Balance Sheet, (ii) incurred in the ordinary course of business since
the date of the Latest Balance Sheet (none of which is a liability resulting
from a breach of contract, breach of warranty, fraud, tort, infringement,
proceeding or violation of any Law), or (iii) that are executory obligations
under a Material Contract (other than liabilities relating to any breach, or any
fact or circumstance that, with notice, lapse of time or both, would result in a
breach, thereof by a Company).
3.8 Condition of Real and Personal Property.
(a)     All of the leased real property that is used in the Ordinary Course of
business of the Companies and their respective Subsidiaries has been maintained
in good condition in the Ordinary Course.
(b)     All tangible personal property that is used in the Ordinary Course of
business of the Companies and their respective Subsidiaries has been maintained
in good operating condition and repair, in the Ordinary Course.
3.9 Contracts.
(a)     Section 3.9 of the Disclosure Schedules sets forth a list (including all
amendments) of all Contracts which (i) require payments by or to (or on behalf
of) any Company or any Subsidiary of a Company which in excess of $50,000 during
any calendar year, (ii) are Contracts relating to indebtedness, including surety
bonds, performance bonds and letters of credit, (iii) are partnership, joint
venture or similar agreements, (iv) are Contracts which contain non-competition
provisions restricting the Companies or any Subsidiary of any Company or “most
favored nations” obligations, (v) grant to the Companies, a Subsidiary of a
Company or any other Person a right of first refusal, first offer or first
negotiation; (vi) are Contracts pursuant to which the Companies or any
Subsidiary of a Company has granted any exclusive marketing, sales
representative relationship, franchising consignment or distribution right to
any third party, (vii) which relate to the operation, control, ownership or
management of any Subsidiary of the Companies, or (viii) which are otherwise
material to the Companies (collectively the “Material Contracts”).

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(b)     The terms of all Material Contracts have been complied with in all
material respects by the Companies and their Subsidiaries and, to Seller’s
knowledge, by the other parties to such Material Contracts. The Material
Contracts are in full force and effect, and neither Company has waived any of
its material rights thereunder.
(c)     No Company or any Subsidiary of a Company has given or received any
written notice of any intention to terminate, repudiate or disclaim any Material
Contract.
3.10     Licenses and Permits. Except as set forth in Section 3.10 of the
Disclosure Schedules, to the Seller’s knowledge, each Company and all of its
Subsidiaries have all governmental permits, licenses and authorizations
necessary under Law for the conduct of the business of the Companies and their
respective Subsidiaries as presently conducted in the Ordinary Course, and all
such permits, licenses and authorizations are valid and in full force and effect
in all material respects. The Companies and their respective Subsidiaries are,
and at all times have been, in compliance in all material respects with the
terms and requirements of all such permits, licenses and authorizations. None of
the Companies or any Subsidiary of a Company has received any notice of any
revocation or non-renewal of such permits, licenses and authorizations.
3.11     Compliance with Laws. Except as set forth in Section 3.11 of the
Disclosure Schedules, each of Seller, the Companies and each Subsidiary of the
Companies is in compliance in all material respects with all applicable Laws,
rules and regulations currently in effect, in each case other than any such
failure to be in compliance as would not, individually or in the aggregate, be
materially adverse to any Company or any Subsidiary of a Company.
3.12 Employee and Labor Matters.
(a)     Section 3.12(a) of the Disclosure Schedules sets forth a true and
complete aggregate list of employees of the Companies or any of their respective
Subsidiaries as of the date hereof (collectively, the “Employees”) and such list
correctly reflects the aggregate amount of the Employees’ base salary or base
wage rate, target bonus or incentive opportunity, the number of exempt and
nonexempt status employees (where applicable) and the number of employees that
are full-time or part-time.
(b)     Section 3.12(b) of the Disclosure Schedules sets forth a true and
complete list of all independent contractors, consultants, agents or other
non-employees providing services to a Company or any Subsidiary of a Company as
of the date hereof (collectively, the “Contractors”) which shall include any
Person that received at least $50,000 in compensation in 2014 or is expected to
receive at least $50,000 in 2015. The Contractors are not covered by or entitled
to benefits under any Company Plan.
(c)     Seller and the Companies have complied in all material respects with
applicable Law relating to labor and employment, including those relating to
wages, hours, collective bargaining, unemployment, compensation, worker’s
compensation, equal employment opportunity, age and disability discrimination,
immigration control, information privacy and security. Neither the Companies nor
any of their respective Subsidiaries is liable for the payment of any material
tax,

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fines, penalties, or other amounts, however designated, for failure to comply
with any applicable Law related to the foregoing
(d)     Except as set forth in Section 3.12 of the Disclosure Schedule, there
are no controversies existing, pending or, to Seller’s knowledge, threatened by
any association or union or collective bargaining representative of the
Employees.
(e)     Except as set forth in Section 3.12 of the Disclosure Schedule, there is
no charge or complaint relating to unfair labor practices pending against
Seller, the Companies or any Subsidiary of a Company, nor is there any labor
strike, work stoppage, grievance or other labor dispute pending or, to Seller’s
knowledge, threatened against Seller, any Company or any Subsidiary of any
Company.
3.13 Intellectual Property Matters; Privacy.
(a) Section 3.13(a) of the Disclosure Schedules contains a true and complete
list of (i) each of the registrations or pending applications for registrations
and (ii) other material Intellectual Property rights owned by a Company or any
of its wholly-owned Subsidiaries (the “Company Owned IP Rights”). Section
3.13(a) of the Disclosure Schedules contains a true and complete list of any
Contract pursuant to which a Company or any of its Subsidiaries grants or is
granted a license to use any Intellectual Property rights (other than for (A)
standard off-the-shelf software license agreements entered into in the Ordinary
Course and (B) non-exclusive licenses granted in the Ordinary Course) (the
“Company Licensed IP Rights”).
(b) The Company Licensed IP Rights and Company Owned IP Rights together
constitute all the Intellectual Property necessary to, and used or held for use
in, the conduct of the business of the Companies as currently conducted. The
consummation of Transactions will not alter, encumber, impair or extinguish any
of the Company Owned IP Rights or the Company Licensed IP Rights.
(c) To the Seller’s knowledge, none of the Companies nor any Subsidiary of a
Company has infringed, misappropriated or otherwise violated any valid and
enforceable and subsisting Intellectual Property right of any third Person.
There is no claim, action, suit or proceeding pending against, or, to the
Seller’s knowledge, threatened against a Company or any of its Subsidiaries, (i)
challenging or seeking to deny or restrict, the rights of such Company in any of
the Company Owned IP Rights or the Company Licensed IP Rights, (ii) alleging
that the use of the Company Owned IP rights or the Company Licensed IP Rights or
any services provided by a Company or any Subsidiary of a Company may
misappropriate, infringe or otherwise violate any Intellectual Property right of
any third Person or (iii) alleging that a Company or any Subsidiary of a Company
has infringed, misappropriated or otherwise violated any Intellectual Property
right of any third Person.
(d) Each of the Companies owns all right, title and interest in and to all of
their respective Company Owned IP Rights, and has a valid and enforceable
contract right to use the Company Licensed IP Rights, free and clear of any
Encumbrance other than Permitted Encumbrances. Each of the Companies has taken
all commercially reasonable actions necessary

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to maintain and protect the Company Owned IP Rights and their respective rights
in the Company Licensed IP Rights, including payment of applicable maintenance
fees and filing of applicable statements of use.
(e) To the Seller’s knowledge, no Person has infringed, misappropriated or
otherwise violated any Company Owned IP Rights or Company Licensed IP Rights;
provided that for purposes of this Section 3.13(e) “Seller’s knowledge” shall
include only the actual knowledge such individual, without regard to the
knowledge such individual would reasonably be expected to obtain in the course
of diligently performing his duties for the Companies.
(f)     Seller, the Companies and their respective Subsidiaries currently have
in place, and have had in place at all times since January 1, 2010, a privacy
policy (the “Privacy Policy”), which Privacy Policy is substantially similar in
all material respects to the privacy policy in effect for Travelzoo. Seller, the
Companies and their respective Subsidiaries are, and all times since January 1,
2010 have been, in compliance in all material respects with the Privacy Policy.
(g)     The Companies and their Subsidiaries post all policies with respect to
the foregoing on their respective websites in conformance with Privacy Laws. 
None of Seller, the Companies or their respective Subsidiaries use, collect or
receive any Personal Information or sensitive non-personally identifiable
information and or become aware of the identity or location of, or identify or
locate, any particular Person as a result of any receipt of such Personal
Information, except in accordance with their respective privacy policies.
(h) To the Seller’s knowledge, there have been no security breaches relating to,
or material violations of any security policy or Privacy Law regarding, or any
unauthorized access of, any data or information used by Seller, the Companies or
any of their respective Subsidiaries, including Personal Information.

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3.14 Employee Benefit Plans.
(a)     Section 3.14(a) of the Disclosure Schedules contains a true, correct and
complete list of each Employee Benefit Plan that is sponsored, maintained or
contributed to by Seller, a Company or any Subsidiary of a Company for the
current or future benefit of any Employee or for which Seller, a Company or any
Subsidiary of a Company has any direct or indirect liability (each, a “Company
Plan”). With respect to each Company Plan, Seller has made available to Buyer,
to the extent applicable: (i) all documents embodying or governing any Company
Plan, any funding mechanism for any Company Plan (including, without limitation,
trust agreements and insurance policies); and (ii) the summary plan description
of the Company Plan (or any other descriptions provided to participants and/or
beneficiaries of such Company Plan).
(b)     Each Company Plan has been maintained in material compliance with its
terms and applicable Law. No Company Plan provides for post­ employment life or
health insurance benefits for any Employee or any beneficiary or dependent of
any Employee.
(c)     With respect to each Company Plan, all contributions have been made in
full or, with respect to payments not due and to the extent required by GAAP,
proper accruals for such contributions have been made and are reflected in the
accounting records of the Companies or their Subsidiaries, other than any
failure that could not reasonably be expected to subject the Companies to any
material liability.
(d)     Except as set forth on the Latest Balance Sheet, or otherwise reflected
in the Closing Balance Sheet, there are no unpaid employment-related liabilities
incurred or accrued prior to the Closing with respect to Employees and other
employees or former employees of the Business, including without limitation any
liabilities in connection with all salaries, wages, bonuses, earned and unpaid
vacation leave, business expenses, retirement allowance and other
reimbursements, termination pay, wrongful dismissal claims, employment insurance
premiums, workers’ compensation payments, income tax and applicable pension plan
deductions and other payments to be made to or on behalf of such individuals or
otherwise.
(e)     Neither the execution of this Agreement nor the consummation of the
Transactions (either alone or together with any other event) will, except as
expressly provided in this Agreement, (i) entitle any Employee to any payment or
benefit, including any bonus, retention, severance, retirement or job security
payment or benefit, or (ii) accelerate the time of payment or vesting or trigger
any payment or funding (through a grantor trust or otherwise) of compensation or
benefits under, or increase the amount payable or trigger any other obligation
under, any Company Plan.
3.15 Intentionally Omitted.
3.16     Insurance. Section 3.16 of the Disclosure Schedules sets forth a true
and complete list of all insurance policies pursuant to which Seller or the
Companies seek to limit, or transfer to a third party, financial or other risk,
owned or held by the Companies or any of their respective Subsidiaries or assets
(collectively, the “Insurance Policies”). For each such policy, Section 3.16 of
the Disclosure Schedules provides a brief summary of the coverage and terms of
each such policy, including (i) the date thereof; (ii) the name of the insurer
and the owner of the policy; (iii) the

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premiums (or similar consideration) paid therefor for each contract/calendar
year for the relevant policy since January 1, 2014; and (iv) the expiration
date. All premiums payable into each such policy have been duly paid and each
such insurance policy is in full force and effect. Except as set forth in
Section 3.16 of the Disclosure Schedules, there is no claim pending under any of
such insurance policies and no such claim made since January 1, 2012 has been
denied or, in the case of any pending claim, questioned or disputed. Neither
Seller nor any Company has received any written notice of cancellation of any of
such insurance policies.
3.17     Transactions with Affiliates. Section 3.17 of the Disclosure Schedules
sets forth all contracts or arrangements between Seller, any Company or any
Subsidiary of a Company, on the one hand, and any of their respective Affiliates
(excluding for these purposes Travelzoo), on the other hand, that will not be
terminated effective as of the Closing Date. Except as disclosed in Section 3.17
of the Disclosure Schedules, and except for any relationships with Travelzoo,
none of Seller, the Companies or their respective Affiliates, directors or
executive officers (i) possesses, directly or indirectly, any financial interest
in, or is a director or executive officer of, any Person (other than any
Company) which is a material client, supplier, customer, lessor, lessee or
competitor of any Company or (ii) owns any property right, tangible or
intangible, which is used by a Company in the conduct of its business.
3.18     Brokers. No finder, broker, agent, or other intermediary acting on
behalf of Seller or the Companies is entitled to a commission, fee, or other
compensation in connection with the negotiation or consummation of this
Agreement or any of the Transactions.
3.19     No Other Representations or Warranties. Except for the representations
and warranties contained in this Article III, Seller makes no other express or
implied representation or warranty on behalf of Seller.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
The Buyer makes the representations and warranties set forth in this Article IV,
each of which is true and correct as of the Closing Date, and which shall
survive the Closing Date and the Transactions to the extent set forth herein.
4.1 Existence and Power.
(a)     The Buyer has the corporate power and authority to enter into this
Agreement, to perform its obligations hereunder, and to consummate the
Transactions.
(b)     The Buyer is duly incorporated, validly existing and in good standing
under the Laws of the United Kingdom.
(c)     The Buyer is not a party to, subject to or bound by any Contract,
Encumbrance, Law or Constituent Document that would prevent Buyer from
performing its obligations hereunder or consummating the Transactions. Except as
set forth in Section 4.1 of the Disclosure Schedules or otherwise provided for
herein, no permit, consent, waiver, approval or authorization of, or

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declaration to or filing or registration with, any governmental or regulatory
authority or third party is required in connection with the execution, delivery
or performance of this Agreement by the Buyer or the consummation by the Buyer
of the Transactions, except for any such permits, consents, waivers, approvals,
authorizations, declarations, filings or registrations the failure of which to
obtain does not have and will not have a material adverse effect on Buyer’s
ability to perform its obligations hereunder or consummate the Transactions.
4.2     Valid and Enforceable Agreement; Authorization. This Agreement
constitutes a legal, valid and binding obligation of the Buyer, enforceable
against it in accordance with its terms, except that such enforcement may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or other
similar Laws affecting or relating to enforcement of creditors’ rights generally
and (ii) general principles of equity. The execution and delivery of this
Agreement and the consummation of the Transactions have been duly authorized,
approved and ratified by all necessary action on the part of the Buyer. The
Buyer has full authority to enter into and deliver this Agreement, to perform
its obligations hereunder, and to consummate the Transactions.
4.3     Brokers. No finder, broker, agent, or other intermediary acting on
behalf of the Buyer is entitled to a commission, fee, or other compensation in
connection with the negotiation or consummation of this Agreement or any of the
Transactions.
4.4     Litigation. There are no actions, suits, proceedings, orders or
investigations pending or threatened against the Buyer or any of the Buyer’s
Affiliates, at Law or in equity, which if adversely determined would have a
material adverse effect on the Buyer’s performance under this Agreement or the
consummation of the Transactions. There are no injunctions, decrees or
unsatisfied judgments outstanding against or related to the Buyer which would
have a material adverse effect on the Buyer’s performance under this Agreement
or the consummation of the Transactions.
4.5     No Knowledge of Breach of Seller Representation. As of the Closing,
Buyer has no knowledge of any current, material breach by Seller of Seller’s
representations or warranties contained in this Agreement or any other
agreements contemplated hereby.
4.6     No Other Representations or Warranties. Except for the representations
and warranties contained in this Article IV, neither the Buyer, nor any other
Person, makes any other express or implied representation or warranty on behalf
of the Buyer.
ARTICLE V
ADDITIONAL COVENANTS OF THE PARTIES
5.1     Books and Records. From and after the Closing, the Buyer shall provide
Seller and its Affiliates and their representatives with reasonable access,
subject to customary restrictions and confidentiality obligations, for any
reasonable purpose, during normal business hours, including but not limited to
(a) preparing Tax Returns or (b) defending any claim in respect of which a
Notice of Claim has been served on Seller by a third party other than Buyer and
its Affiliates, to all books and records related to the Companies, including,
but not limited to, accounting and Tax records (“Records”) pertaining or
relating to the period prior to the Effective Time. Unless otherwise consented
to in writing by Seller, the Buyer shall not, for a period of seven (7) years
following the

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date hereof or such longer period as retention thereof is required by applicable
Law, destroy, alter or otherwise dispose of (or allow the destruction,
alteration or disposal of) any of the Records without first offering to
surrender to Seller such Records.
5.2 Confidentiality; Announcements.
(a)    Following the Closing, Seller shall maintain, and shall cause its
Affiliates to maintain, in confidence any information it or they may have in
relation to the Companies, and such information shall not be disclosed or used
by Seller or its Affiliates without the Buyer’s prior written consent, unless
such information is (i) otherwise publicly available (except as a result of a
breach hereof by Seller or its Affiliates), (ii) required to be disclosed
pursuant to judicial order, regulation or Law or (iii) required to be disclosed
by the rules of the NASDAQ Global Select Market. In the event that Seller or any
of its Affiliates or representatives become legally compelled to disclose any
such information or documents as referred to in this paragraph, Seller shall, to
the extent reasonably practicable, provide the Buyer with prompt written notice
before such disclosure, sufficient to enable the Buyer either to seek a
protective order, at its expense, or other appropriate remedy preventing or
prohibiting such disclosure or to waive compliance with the provisions of this
Section 5.2.
(b)    None of the Parties nor any of their respective representatives shall
issue any press releases or make any public announcements with respect to this
Agreement or the Transactions without the prior written consent of Buyer and
Seller, as the case may be. Notwithstanding the foregoing, any such press
release or public announcement may be made if required by applicable Law or rule
of a stock exchange; provided that the Party required to make such press release
or public announcement shall, to the extent possible, confer with the other
Parties concerning the timing and content of such press release or public
announcement before the same is made.
5.3 Advertiser and Subscriber Information.
(a)    As promptly as reasonably practicable following the Closing, Seller shall
make available, and shall cause its Affiliates to make available, to Buyer
information relating to advertisers, subscribers and Web site visitors
pertaining to the Companies and their respective Subsidiaries (“Client
Information”) to the extent permitted by applicable Laws. Seller or its
Affiliates may withhold any Client Information to the extent it reasonably
believes (based on the opinion of legal counsel) that providing such could
violate applicable Law or the terms of any agreement to which Seller or any of
its Affiliates is a party. Seller represents and warrants that it is not
currently aware of any Laws or agreements which would prevent Seller from
providing such Client Information.
(b)    Buyer shall not use any Client Information in any way that could violate
the privacy policies of Seller or its Affiliates as in effect as of the Closing
Date. Buyer further agrees to comply with all applicable data protection and
privacy Laws in connection with the use of such Client Information.
5.4     Cooperation; Further Assurances. On or after the Closing Date, the
Parties shall, on request, cooperate with one another by furnishing any
additional information, executing and delivering any additional documents and
instruments and doing any and all such other things as

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may be reasonably required by the Parties or their counsel to consummate or
otherwise implement the Transactions.
5.5 Financial Statements.
(a)     On or prior to September 10, 2015, Seller shall deliver to Buyer true
and complete copies of the following financial statements (such financial
statements, the “Financial Statements”):
(i)    the audited combined consolidated balance sheet of the Companies for the
two (2) years ended as of December 31, 2014 and 2013, and the related audited
statements of operations, statements of comprehensive income (loss), cash flows
and stockholders’ equity for each fiscal year of the Companies then ended, as
well as for the fiscal year ended December 31, 2012 (collectively, the “Audited
Financials”);
(ii)    the (A) unaudited combined consolidated balance sheet of the Companies
as of the two (2) years ended December 31, 2012 and 2011 (the “Unaudited Annual
Balance Sheets”), (B) unaudited, combined consolidated state of comprehensive
income (loss) for the year ended December 31, 2011 (the “Unaudited Income
Statement”), (C) unaudited combined consolidated balance sheet of the Companies
as of March 30, 2014, June 30, 2014, September 30, 2014, March 30, 2015 (the
“Historic Quarterly Financials”), and June 30, 2015 (the “Latest Balance Sheet”)
and (D) the unaudited consolidated statements of operations, statements of
comprehensive income (loss), and cash flows for each period ended as of March
30, 2014, June 30, 2014, September 30, 2014, March 30, 2015 and June 30, 2015,
together with related notes (collectively, with the Unaudited Balance Sheets,
the Unaudited Income Statement and the Historic Quarterly Financials, the
“Primary Unaudited Financials”); and
(iii)    the unaudited combined consolidated statement of income for the
Companies for the three (3) months ended December 31, 2014 and related notes
(together with the Primary Unaudited Financials, the “Unaudited Financials”).
(b)     The Financial Statements shall be in form and substance consistent in
all material respects with the financial statements set forth on Section 5.5 of
the Disclosure Schedules.

5.6     Termination of Certain Agreements Seller agrees that at the Closing any
agreements listed in Section 5.6 of the Disclosure Schedules shall have been
terminated, cancelled, settled or otherwise made inoperative without any further
action by the parties thereto without any further obligations under such
agreements. The Parties acknowledge and agree that on and after the Closing
Date, the Companies shall no longer have any rights or obligations or otherwise
be able to benefit from those agreements set forth in Section 5.6(i) of the
Disclosure Schedules (such agreements, the “Terminated Contracts“). Without
limitation to the foregoing, with respect to agreements entered into on or prior
to the Closing Date between Seller, a Company or any Subsidiary of a Company, on
the one hand, and any of their respective Affiliates, on the other hand, Seller
shall (i) terminate or cause to be terminated, (ii) eliminate and procure the
release of all liabilities and (iii) terminate all rights of the Companies under
such agreements to intercompany accounts payable and accounts receivable without
any further action by the parties thereto or any further liability, penalty or
cost

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of the Companies, Buyer or any of their respective Affiliates. Notwithstanding
the foregoing, the arrangements set forth in Section 5.6(ii) of the Disclosure
Schedules shall survive the Closing in accordance with their terms, and Buyer
hereby agrees to assume and satisfy the obligations of Seller pursuant to such
arrangements in accordance with their terms.
5.7 Non-Competition; Non-Solicitation.
(a)     Seller shall not, and shall not permit any of its Affiliates to,
directly or indirectly, other than indirectly through such Person’s investment
in Travelzoo, (i) engage in or assist others in engaging in the Restricted
Business in the Territory; or (ii) have an interest in any Person that engages
directly or indirectly in the Restricted Business in the Territory in any
capacity, including as a partner, shareholder, member, employee, principal,
agent, trustee or consultant; in each case, for a period beginning on the
Closing Date and ending on the third (3rd) anniversary of the Closing Date (such
period, the “Restricted Period”). Notwithstanding the foregoing, Seller may own,
directly or indirectly, solely as an investment, securities of any Person traded
on any national securities exchange if Seller is not a controlling Person of, or
a member of a group which controls, such Person and does not, directly or
indirectly, own five percent (5%) or more of any class of securities of such
Person.
(b)     During the Restricted Period, Seller shall not, and shall not permit any
its Affiliates to, directly or indirectly, hire or solicit any employee of the
Companies or encourage any such employee to leave such employment or hire any
such employee who has left such employment, except pursuant to a general
solicitation which is not directed specifically to any such employees; provided,
that nothing in this Section 5.7 shall prevent Seller or any of its Affiliates
from hiring (i) any employee whose employment has been terminated by the
Companies, or (ii) after one (1) year from the date of termination of
employment, any employee whose employment has been terminated by the employee.
(c)     During the Restricted Period, Seller shall not, and shall not permit any
of its Affiliates to, directly or indirectly, solicit or entice, or attempt to
solicit or entice, any clients, business partners or customers of the Companies
or potential clients, business partners or customers of the Companies for
purposes of diverting their business or services from the Companies.
(d)     Seller acknowledges that a breach or threatened breach of this Section
5.7 would give rise to irreparable harm to Buyer, for which monetary damages
would not be an adequate remedy, and hereby agrees that in the event of a breach
or a threatened breach by Seller of any such obligations, Buyer shall, in
addition to any and all other rights and remedies that may be available to it in
respect of such breach, be entitled to equitable relief, including a temporary
restraining order, an injunction, specific performance and any other relief that
may be available from a court of competent jurisdiction (without any requirement
to post bond).
(e)     Seller acknowledges that the restrictions contained in this Section 5.7
are reasonable and necessary to protect the legitimate interests of Buyer and
constitute a material inducement to Buyer to enter into this Agreement and
consummate the Transactions. In the event that any covenant contained in this
Section 5.7 should ever be adjudicated to exceed the time, geographic, product
or service, or other limitations permitted by applicable Law in any
jurisdiction,

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then any court is expressly empowered to reform such covenant, and such covenant
shall be deemed reformed, in such jurisdiction to the maximum time, geographic,
product or service, or other limitations permitted by applicable Law. The
covenants contained in this Section 5.7 and each provision hereof are severable
and distinct covenants and provisions. The invalidity or unenforceability of any
such covenant or provision as written shall not invalidate or render
unenforceable the remaining covenants or provisions hereof, and any such
invalidity or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such covenant or provision in any other jurisdiction.
ARTICLE VI
INDEMNIFICATION
6.1     Indemnification by Seller. Subject to the limitations set forth in this
Article VI, Seller shall indemnify and hold harmless the Buyer, and its current
and former officers, directors, managers, members, employees, agents and
Affiliates, including officers and directors of any Affiliate of Buyer
(collectively, the “Buyer Parties”) against and in respect of any and all Losses
arising from:
(a)     any breach or violation of the covenants or other agreements made by
Seller, the Companies or any of their respective Affiliates in Articles II, V,
VI, or VII; or
(b)     any breach of any of the representations and warranties made in Article
III by Seller.
6.2     Indemnification by Buyer. The Buyer shall indemnify and hold harmless
Seller and its current and former officers, directors, managers, members,
employees, agents and Affiliates, including officers and directors of any
Affiliate of Seller (collectively, the “Seller Parties”) against and in respect
of any and all Losses arising from:
(a)     any breach or violation of the covenants or other agreements made by the
Buyer or any of its Affiliates in Articles II, V, VI, or VII; or
(b)     any breach of any of the representations or warranties made in Article
IV by the Buyer.
6.3     Notice and Payment of Losses. Upon obtaining knowledge of any Loss, the
Party entitled to indemnification (the “Injured Party”) shall promptly notify
the Party liable for such indemnification (the “Indemnifying Party”) in writing
of such Losses which the Injured Party has determined have given or could give
rise to a claim under Sections 6.1 or 6.2 (such written notice being hereinafter
referred to as a “Notice of Claim”); provided, however, that failure of an
Injured Party timely to give a Notice of Claim to the Indemnifying Party shall
not release the Indemnifying Party from its indemnity obligations set forth in
this Article VI except and to the extent that such failure materially adversely
affects the ability of the Indemnifying Party to defend such claim or increases
the amount of indemnification which the Indemnifying Party is obligated to pay
hereunder, in which event the amount of indemnification which the Injured Party
shall be entitled to receive shall be reduced to an amount which the Injured
Party would have been entitled to receive had such Notice of Claim been timely
given. The Injured Party shall not make any admission of liability,

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agreement or compromise with any Person in relation to a Loss without prior
consultation with the Indemnifying Party. A Notice of Claim shall specify in
reasonable detail, to the extent known by the Injured Party, the nature and, to
the extent reasonably calculable, estimated amount of any such claim giving rise
to a right of indemnification. The Indemnifying Party shall satisfy its
obligations under Sections 6.1 or 6.2, as the case may be, within sixty (60)
Business Days of its receipt of a Notice of Claim; provided, however, that for
so long as the Indemnifying Party is disputing its liability or defending a
third-party claim in good faith pursuant to Section 6.4, its obligations to
indemnify the Injured Party with respect thereto shall be suspended until a
final unappealable judgment of a court of competent jurisdiction is given in
relation to such claim. The Indemnifying Party shall have thirty (30) Business
Days (or such shorter period of time that the Injured Party may be required to
respond to any suit or governmental action) after receipt of a Notice of Claim
to notify the Injured Party (a) whether or not it disputes its liability to the
Injured Party with respect to such Notice of Claim and (b) whether it elects to
defend a third party claim pursuant to Section 6.4.
6.4     Defense of Third-Party Claims. With respect to any action or any claim
set forth in a Notice of Claim relating to a third-party claim, the Indemnifying
Party may defend, in good faith and at its expense, any such claim or demand,
and the Injured Party, at its expense, shall have the right, but not the
obligation, to participate (but not control) at its expense in the defense of
any such third-party claim; provided, that the Indemnifying Party shall not be
entitled to assume the defense of a third-party claim to the extent that the
Injured Party reasonably determines that it has defenses, claims or positions
that are in conflict with, or otherwise unique, separate or distinct from the
defenses, claims or positions that might be available to other Persons relating
to such third-party claim, in which case the Injured Party shall have the right
to elect to be represented by separate counsel to assert such legal defenses and
to otherwise participate in the defense of such action on behalf of such Injured
Party, with such defense of such third-party claim and the costs and expenses of
such separate counsel to be borne by the Indemnifying Party. So long as the
Indemnifying Party assumes and thereafter diligently defends any such
third-party claim, the Injured Party shall not settle or compromise such
third-party claim without the consent of the Indemnifying Party. The
Indemnifying Party may only settle or compromise such third-party claim without
the consent of the Injured Party if such settlement or compromise (i) is solely
for monetary damages with no admission of fault on the part of the Injured
Party, and (ii) the Indemnifying Party has secured a written unconditional
release of the Injured Party. The Injured Party shall make available to the
Indemnifying Party or its representatives all records and other materials
reasonably required for use in contesting any third-party claim. The Injured
Party shall cooperate fully with the Indemnifying Party in the defense of all
such claims. If the Indemnifying Party elects not to defend any such third-party
claims, or elects to defend such claims but thereafter fails to diligently
pursue such defense, the Injured Party shall have no obligation to do so, but
may defend, settle or compromise any such third-party claim at the risk and
expense of the Indemnifying Party. The Indemnifying Party will not, however, be
responsible for any Losses if and to the extent that they arise from action
taken or omitted to be taken by the Injured Party in bad faith, fraudulently,
negligently or as a result of a breach of this Agreement by the Injured Party.
6.5 Survival of Representations and Warranties.

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(a)     Except as specifically set forth in this Section 6.5, the
representations and warranties made by any Party in Article III and Article IV
shall survive for a period of twelve (12) months following the Closing Date and
thereafter to the extent a Notice of Claim is made prior to such expiration with
respect to any breach of such representation or warranty occurring prior to such
expiration and set out in such Notice of Claim.
(b)     The representations and warranties of the Parties set forth in Sections
3.3 (Tax Matters), 3.12 (Employee and Labor Maters), and 3.14 (Employee Benefit
Plans) shall survive until sixty (60) days following expiration of the
applicable statute of limitations.
(c)     The representations and warranties of the Seller set forth in Sections
3.1 (Existence and Power), 3.2 (Valid and Enforceable Agreement; Authorization),
3.6 (Securities Ownership), and 3.18 (Brokers), and the representations and
warranties of the Buyer set forth in Sections 4.1 (Existence and Power), 4.2
(Valid and Enforceable Agreement; Authorization), and 4.3 (Brokers)
(collectively, the “Fundamental Representations”), shall survive the Closing
Date indefinitely.
(d)     No party shall be entitled to indemnification for breach of any
representation and warranty set forth in Article III or Article IV unless a
Notice of Claim of such breach has been given to the Indemnifying Party within
the period of survival of such representation and warranty as set forth herein.
6.6 Limitation on Indemnification.
(a)     The provisions for indemnity under Sections 6.1(b) and 6.2(b) in respect
of breaches of representations and warranties, as the case may be, shall be
effective only when the aggregate amount of all Losses for which indemnification
is sought from Seller or the Buyer under Sections 6.1(b) and 6.2(b) in respect
of breaches of representations and warranties, respectively, exceeds One Hundred
Fifty Thousand dollars ($150,000) (the “Indemnity Basket”), in which event the
Indemnifying Party shall be liable for all Losses in excess of such amount.
(b)     The indemnification obligations of Seller or the Buyer pursuant to
Sections 6.1(b) and 6.2(b) in respect of breaches of representations and
warranties, as the case may be, shall be effective only until the aggregate
dollar amount paid by the Indemnifying Party in respect of all Losses
indemnified against under such Sections, equals Five Million One Hundred Thirty
Thousand dollars ($5,130,000) (the “Indemnity Cap”).
(c)     Notwithstanding the foregoing, the limitations of Sections 6.6(a) and
6.6(b) shall not apply to any Losses arising (i) under Sections 6.1(a) or 6.2(a)
in respect of the breach of any covenant or agreement, (ii) out of a breach of
Section 3.14(d), (iii) out of the breach of any Fundamental Representation, or
(iv) from the fraud or intentional misrepresentation of a party.
(d)     All indemnification obligations shall be paid in U.S. dollars in the
United States.
(e)     If Seller pays to any Buyer Parties an amount in respect of any claim
under this Agreement and the Buyer subsequently recovers from a third party
(including an insurer) a sum

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which is related to that claim, the Buyer shall promptly repay to Seller so much
of the amount paid by Seller as does not exceed the sum recovered from the third
party less all reasonable costs, charges and expenses incurred by the Buyer
Parties in obtaining that payment and in recovering that sum from the third
party.
(f)     Seller shall not be liable for any breach or non-fulfillment of any of
the representations or warranties contained herein, if and to the extent that
the Loss occasioned thereby has been recovered under the same or any other
representation or warranty contained herein.
(g)     Nothing shall diminish the Buyer’s common law obligation to mitigate its
loss in a commercially reasonable manner.
(h)     NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED HEREIN, NO PARTY
SHALL BE LIABLE OR OTHERWISE RESPONSIBLE TO ANY OTHER PARTY HERETO OR ANY
AFFILIATE OF ANY OTHER PARTY HERETO FOR CONSEQUENTIAL, SPECIAL, EXEMPLARY OR
PUNITIVE DAMAGES, OTHER THAN (i) CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE
DAMAGES (X) AWARDED TO A THIRD PARTY PURSUANT TO A THIRD PARTY CLAIM OR (Y) IN
CONNECTION WITH CLAIMS OF FRAUD OR WILLFUL OR INTENTIONAL MISREPRESENTATION OR
(ii) CONSEQUENTIAL OR SPECIAL DAMAGES THAT WERE REASONABLY FORESEEABLE ON THE
DATE HEREOF OR ON THE CLOSING DATE AND ARE A DIRECT CONSEQUENCE OF OR DIRECT
RESULT OF, OR DIRECTLY ARISE FROM, A BREACH OF THIS AGREEMENT.
6.7     Payments. Any Losses that any Buyer Parties are entitled to recover
pursuant to Section 6.1 may be satisfied, at Buyer Parties’ election upon
written notice to Seller, by (a) Buyer’s exercise of its Right of Offset, or (b)
Seller by wire transfer of immediately available funds to an account designated
in writing by such Buyer Parties (the “Payment Option”). Any Losses that any
Seller Parties are entitled to recover pursuant to Section 6.2 shall be
satisfied by Buyer, by wire transfer of immediately available funds to an
account designated in writing by such Seller Parties. Once a Loss is agreed to
by the Indemnifying Party or finally adjudicated to be payable pursuant to this
Article VI, the Indemnifying Party shall satisfy its obligations within fifteen
(15) Business Days of such adjudication by wire transfer of immediately
available funds (with the understanding that if Seller Parties are the
Indemnifying Party, payment by wire transfer shall only be required if Buyer
Parties elect the Payment Option). The Parties hereto agree that should an
Indemnifying Party not make full payment of any such obligations within such
fifteen (15) Business Day period, any amount payable shall accrue interest from
and including the date of agreement of the Indemnifying Party or final
adjudication to but excluding the date such payment has been made at a rate per
annum equal to seven percent (7%) (with the understanding that if Seller Parties
are the Indemnifying Party, payment shall only be required if Buyer Parties
elect the Payment Option). Such interest shall be calculated on the basis of a
365 day year and the actual number of days elapsed, without compounding.
6.8     Right of Offset; Escrow. Buyer shall have the right to offset from the
Promissory Note (the “Right of Offset”) the amount of payments owing to Buyer
Parties pursuant to Section 2.5 and/or Section 6.7 (subject to the limitations
set forth in Section 6.6), and any such offset shall be deemed

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to satisfy Seller’s obligations with respect to any such payments. In addition
to and not in limitation of the foregoing, in the event Buyer proposes to fully
satisfy its obligations pursuant to and in accordance with the Promissory Note
at any time prior to the twelve month anniversary of the Closing, Buyer and
Seller hereby agree that Buyer may, in lieu of payment of any principal and
interest payable to Seller in such satisfaction, deposit an amount equal to or
less than the difference between (i) the Indemnity Cap, minus (ii) any amount
previously paid or set off in respect of Seller’s indemnification obligations
pursuant to this Article VI into an escrow account to be maintained by Buyer’s
counsel, pursuant to an escrow agreement substantially in the form attached as
Exhibit C hereto (the “Escrow Agreement”), for a period not to exceed the twelve
month anniversary of the Closing Date; provided, however, that in the event and
to the extent any Notice(s) of Claim are delivered prior to the twelve month
anniversary of the Closing Date, an amount adequate to satisfy such Notice(s) of
Claim shall be held in escrow beyond the twelve month anniversary of the Closing
Date in accordance with the terms of the Escrow Agreement.
6.9     Characterization of Indemnity Payments. Any indemnification payments
made pursuant to this Agreement shall be considered, to the extent permissible
under Law, as adjustments to the Purchase Price for all Tax purposes.
6.10     Exclusive Remedy. In the absence of fraud or intentional
misrepresentation, and except for obtaining equitable remedies, the
indemnification provisions set forth in this Article VI shall provide the
exclusive remedy for breaches of any covenant, agreement, representation or
warranty set forth in this Agreement or any other agreement ancillary hereto
executed pursuant to this Agreement.
ARTICLE VII
MISCELLANEOUS PROVISIONS
7.1     Notice. All notices, requests, demands, and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given and made upon (i) in the case of personal
delivery or delivery by electronic mail or facsimile, on the date of such
delivery, (ii) in the case of nationally recognized overnight courier, on the
next Business Day following dispatch and (iii) in the case of mailing, on the
third (3rd) Business Day following such mailing if sent by certified mail,
return receipt requested, postage prepaid. All such notices, requests, demands
and other communications shall be addressed at the address or facsimile number
shown in this Section 7.1 for, or such other address or facsimile number as may
be designated in writing hereafter by, such Party:
If to Seller:
c/o Intertrust
190 Elgin Avenue, George Town,
Grand Cayman KY1-9005,
Cayman Islands

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With a copy simultaneously by like means to (which copy shall not constitute
notice):
Armstrong Teasdale LLP
7700 Forsyth Boulevard
Suite 1800
St. Louis, MO 63105
Attention: Michael Jefferies
Email: mjefferies@armstrongteasdale.com

If to Buyer:
Travelzoo Inc.
590 Madison Avenue, 37th Floor
New York, New York 10022
Attention: Glen Ceremony and Rachel Barnett
Email: gceremony@travelzoo.com
rbarnett@travelzoo.com

With a copy simultaneously by like means to (which copy shall not constitute
notice):
Zukerman Gore Brandeis & Crossman, LLP
11 Times Square, 15th Floor
New York, New York 10036
Telephone: (212) 223-6700
Fax: (212) 223-6433
Attention: Clifford A. Brandeis
Email: cbrandeis@zukermangore.com

7.2 Entire Agreement. This Agreement, together with the Promissory Note and the
Disclosure Schedules and Exhibits hereto, embody the entire agreement and
understanding of the Parties hereto with respect to the subject matter hereof,
and supersede all prior and contemporaneous agreements and understandings
relative to such subject matter.
7.3     Severability. If any provision hereof shall be held invalid or
unenforceable by any court of competent jurisdiction or as a result of future
legislative action, such holding or action shall be strictly construed and shall
not affect the validity or effect of any other provision hereof, as long as the
remaining provisions, taken together, are sufficient to carry out the overall
intentions of the Parties as evidenced hereby.
7.4 Assignment; Binding Agreement. This Agreement and various rights and
obligations arising hereunder shall inure to the benefit of and be binding upon
the Parties hereto and their successors and permitted assigns. Neither this
Agreement nor any of the rights, interests, or

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obligations hereunder shall be transferred, delegated, or assigned by the
Parties hereto without the prior written consent of the other Party (which
consent shall not be unreasonably withheld), except that Buyer shall have the
right to designate a subsidiary entity to act as the Buyer hereunder, and Buyer
shall have the right to transfer and assign its rights hereunder to any entity
which is controlled by the Buyer or by the Affiliates of the Buyer. No such
assignment shall relieve the Buyer of any liability or obligation hereunder.
7.5     Expenses. Except as otherwise specifically set forth herein, all fees
and expenses incurred in connection with the Transactions, this Agreement and
the Transactions, including the fees and disbursements of counsel, financial
advisors and accountants, shall be paid by the Party incurring such fees or
expenses.
7.6     Counterparts. This Agreement may be executed in one or more original,
facsimile or electronic (i.e. PDF, or portable document format) counterparts,
each of which shall be deemed to be an original, but all of which shall
constitute one and the same agreement.
7.7     Headings; Interpretation. The table of contents, article and section
headings contained in this Agreement are inserted for convenience only and shall
not affect in any way the meaning or interpretation of the Agreement. Each
reference in this Agreement to an Article, Section, Schedule or Exhibit, unless
otherwise indicated, shall mean an Article or a Section of this Agreement or a
Schedule or Exhibit attached to this Agreement, respectively. References herein
to “days”, unless otherwise indicated, are to consecutive calendar days.
Whenever the words “include,” “includes,” “including” or words of similar import
are used in this Agreement, they shall be deemed followed by the words “without
limitation.” Whenever the context requires in this Agreement, the masculine
pronoun shall include the feminine and the neuter, and the singular shall
include the plural, and vice versa. Whenever this Agreement shall require a
Party to take an action, such requirement shall be deemed an undertaking by such
Party to cause it, and to use its commercially reasonable efforts to cause its
other Affiliates, to take appropriate action in connection therewith. References
to any agreement or contract are to such agreement or contract as amended,
modified or supplemented from time to time in accordance with the terms hereof
and thereof. All Parties have participated substantially in the negotiation and
drafting of this Agreement and agree that no ambiguity herein should be
construed against the draftsman. All references to “$” or “dollars” mean the
lawful currency of the United States of America. References to a “corporation”
or “company” shall be construed so as to include any corporation, company or
other body corporate, wherever and however incorporated or established.
References “from” or “through” any date mean, unless otherwise specified, “from
and including” or “through and including,” respectively.
7.8     Governing Law. This Agreement shall in all respects be construed in
accordance with and governed by the substantive Laws of the State of New York
applicable to contracts executed and performed entirely within the state,
without reference to its choice of law rules.
7.9     Arbitration. In the event of any dispute hereunder, the parties shall
use their reasonable efforts to resolve such dispute through discussions by
their authorized representatives. Any dispute which is not so resolved within 15
calendar days after the start of such discussions (or such longer period as may
be mutually agreed) shall be resolved by arbitration by JAMS (“JAMS”). The
arbitration proceedings, including the rendering of an award, shall take place
in the Borough of

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Manhattan, New York, New York. The arbitration panel shall consist of three
persons, one chosen by each of the Buyer and the Seller, and the third chosen by
such two arbitrators. If the first two arbitrators are unable to agree on the
third arbitrator, the third arbitrator shall be appointed by JAMS. If either
Party does not select an arbitrator within 10 days after a request for
arbitration hereunder, the arbitrator chosen by the other Party shall act as the
sole arbitrator. The arbitration proceedings shall be conducted in accordance
with the in accordance the JAMS Comprehensive Arbitration Rules & Procedures.
The award of such arbitral tribunal shall be final. Judgment upon such award may
be entered by the prevailing Party in any court having jurisdiction. The award
of the arbitral tribunal may be alternatively or cumulatively for monetary
damages. The arbitral tribunal may issue interim awards and order any
provisional measures which should be taken to preserve the respective rights of
a Party. The arbitral tribunal shall charge all costs and expenses of the
arbitration, including the fees and expenses of the arbitral tribunal and any
experts, to the nonprevailing Party; provided that if the tribunal determines
that there is not a prevailing Party, such costs and expenses shall be allocated
between the parties as the arbitral tribunal deems fair and reasonable taking
into account the extent to which parties’ relative positions have prevailed.
7.10 Disclosure Generally. If and to the extent any information required to be
furnished in any Disclosure Schedule is contained in this Agreement or in any
other Disclosure Schedule, such information shall be deemed to be included in
all of the Disclosure Schedules in which the information would otherwise be
required to be included to the extent the relationship of such information to
such other Disclosure Schedule is reasonably apparent on the face of the
applicable disclosure. The inclusion of any information in any Disclosure
Schedule shall not be deemed to be an admission or acknowledgment that such
information is material or outside the Ordinary Course.
7.11 No Third Party Beneficiaries or Other Rights. Nothing herein shall grant to
or create in any Person not a party hereto, or any such Person’s Affiliates, any
right to any benefits hereunder, and no such party shall be entitled to sue
either Party to this Agreement with respect thereto. The representations and
warranties contained in this Agreement are made for purposes of this Agreement
only and shall not be construed to confer any additional rights on the Parties
under applicable state or federal or foreign securities Laws.
[Signatures on following page]

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IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be
executed as of the date first above written.

TRAVELZOO (EUROPE) LIMITED

 

By:    /s/ Richard Singer
Name: Richard Singer
Title: Managing Director, Europe
    
    
TRAVELZOO (ASIA PACIFIC) INC.

 

By:    /s/ Ralph Bartel
Name: Ralph Bartel
Title: Director