Travelzoo Inc. Board of Directors Approves Reverse/Forward Stock Split

  Travelzoo Inc. Board of Directors Approves Reverse/Forward Stock Split

Business Wire

NEW YORK -- June 11, 2013

Travelzoo Inc. (NASDAQ: TZOO), a global Internet media company, today
announced that a Special Committee of its Board of Directors, consisting of
three independent directors (the “Special Committee”), and its full Board of
Directors unanimously approved a reverse/forward stock split transaction,
subject to shareholder approval, intended to reduce its shareholder account
administration costs by reducing the number of its shareholders from over
90,000 to fewer than 10,000.

The proposed reverse/forward stock split transaction consists of a 1-for-25
reverse stock split of the Company's outstanding common stock, followed
immediately by a 25-for-1 forward stock split (collectively referred to as the
“reverse/forward split”). Shareholders holding less than 25 shares of common
stock immediately prior to the reverse split will not receive fractional
shares in the reverse stock split, but will instead have their shares
converted into the right to receive a cash payment in exchange for and in
proportion to the fractional share interests resulting from the reverse stock
split. These fractional share interests will be aggregated by the Company’s
transfer agent and sold on the open market following the forward stock split.

Shareholders who held less than 25 shares immediately prior to the reverse
stock split will receive a cash payment based on and equal to their resulting
fractional interest times the price of a share equal to the higher of (a) the
trailing ten day average trading price of the Company’s common stock
immediately preceding consummation of the reverse/forward split or (b) the
average aggregate sales price received in the sale on the open market of the
shares resulting from aggregation of the fractionalized interests.
Shareholders holding 25 or more shares of common stock immediately before the
reverse/forward split will not receive a cash payment, but will continue to
hold the same number of shares after completion of the reverse/forward split
as they held immediately prior. As a result, the Company anticipates no
changes in the total number of outstanding shares of common stock as a result
of the reverse/forward split.

Shareholders holding fewer than 25 shares can avoid being cashed out by this
proposed transaction by increasing their shareholdings to 25 or more shares of
common stock or, if applicable, combining their various accounts to have one
shareholder account with 25 or more shares held, so long as such actions are
effected prior to completion of the reverse/forward split. The Company expects
both registered and beneficial shareholder accounts holding less than 25
shares of common stock will be cashed out; however, persons that beneficially
hold shares through a nominee (such as a broker or bank) will be advised to
contact their nominee to be informed of any procedures such holders may need
to follow in order to ensure the same treatment as registered shareholders.

The Company expects that approximately 655,000 of its outstanding shares will
be fractionalized as a result of the reverse stock split and subsequently sold
by the Company’s transfer agent on the open market to fund the cash payments
to shareholders that hold only fractional share interests as a result of the
reverse stock split.

The Special Committee engaged Duff & Phelps, LLC as financial advisors to
review the fairness of the transaction, and received from them an opinion
regarding the fairness, from a financial point of view, to the Company's
shareholders whose positions, individually considered, consist of fewer than
25 shares, of the per-share consideration to be received by such shareholders
in the reverse/forward split.

Closing of the transaction is conditioned upon receipt of a bring-down
fairness opinion prior to the execution of the proposed reverse/forward split
and approval by the Company's shareholders, including a majority of the
Company's non-affiliated shareholders.

The Special Committee received legal counsel from Young Conaway Stargatt &
Taylor, LLP in connection with their review of the proposed transaction. In
addition, the Company received legal counsel from Skadden, Arps, Slate,
Meagher & Flom LLP and Bryan Cave LLP in connection with the proposed
transaction.

The Company plans to seek shareholder approval of this proposed transaction at
its annual shareholders' meeting in order to reduce proxy-related costs. The
Company expects to file with the Securities and Exchange Commission ("SEC")
its preliminary proxy statement for the annual meeting and the proposed
reverse/forward split and will determine the annual meeting date, which will
be disclosed in the definitive proxy statement to be filed with the SEC and
mailed to shareholders entitled to vote at the meeting.

The Special Committee retains the right to defer or abandon the proposed
transaction at any time prior to its completion, even if shareholder approval
is obtained.

This press release is only a description of the proposed transaction and is
not an offer to sell or acquire any shares of common stock.

About Travelzoo

Travelzoo Inc. is a global Internet media company. With more than 26 million
subscribers in North America, Europe, and Asia Pacific and 25 offices
worldwide, Travelzoo® publishes deals from more than 2,000 travel and
entertainment companies. Travelzoo's deal experts review offers to find the
best deals and confirm their true value. In Asia Pacific, Travelzoo is
independently owned and operated by Travelzoo (Asia) Ltd. and Travelzoo Japan
K.K. under a license agreement with Travelzoo Inc.

Certain statements contained in this press release that are not historical
facts may be forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities and Exchange Act
of 1934. These forward-looking statements may include, but are not limited to,
statements about our plans, objectives, expectations, prospects and
intentions, markets in which we participate and other statements contained in
this press release that are not historical facts. When used in this press
release, the words “expect,” “predict,” “project,” “anticipate,” “believe,”
“estimate,” “intend,” “plan,” “seek” and similar expressions are generally
intended to identify forward-looking statements. Because these forward-looking
statements involve risks and uncertainties, there are important factors that
could cause actual results to differ materially from those expressed or
implied by these forward-looking statements, including changes in our plans,
objectives, expectations, prospects and intentions and other factors discussed
in our filings with the SEC. We cannot guarantee any future levels of
activity, performance or achievements. Travelzoo undertakes no obligation to
update forward-looking statements to reflect events or circumstances occurring
after the date of this press release. Travelzoo and Top 20 are registered
trademarks of Travelzoo. All other names are trademarks and/or registered
trademarks of their respective owners.

Contact:

Travelzoo, North America
Christie McConnell, 212-484-4912
cmcconnell@travelzoo.com