Travelzoo (NASDAQ:TZOO) Files An 8-K Costs Associated with Exit or Disposal Activities
Item 2.05 Costs Associated with Exit or Disposal Activities
As previously disclosed by Travelzoo (the “Company”) on a Current Report on Form 8-K filed on March 10, 2020 (the “Form 8-K”) and as a subsequent event in its Current Report on Form 10-K for the year ended December 31, 2019 (the “Form 10-K”), on March 10, 2020 the Company announced that it would exit its business in Asia Pacific for strategic reasons, as described in a press release issued on March 10, 2020 and the Form 8-K filed on the same day.
In connection with this exit, on June 16, 2020, the Company completed a sale of 50% of the outstanding capital stock of Travelzoo Japan K.K. (“Travelzoo Japan”) to Mr. Hajime Suzuki, the General Manager of Japan (the “Stock Sale”). The parties entered into a License Agreement, whereby Travelzoo Japan obtained a license to use intellectual property (including trademarks, software, business processes and trade secrets) from Travelzoo exclusively in Japan in exchange for quarterly royalty payments over a 5 year term, with an option to renew. Travelzoo also provided an interest-free loan to Mr. Suzuki and Travelzoo Japan of JPY 46,000,000 to be re-paid over the course of 3 years.
Upon the completion of the Stock Sale, all affected employees have now been informed of the plan for Asia Pacific. The Company expects expenses associated with the plan as follows:
There will also be costs for the dissolution and deregistration of certain legal entities. These costs cannot be fully estimated at this time. The dissolution and deregistration of the legal entities is expected to be substantially completed by the end of 2020.
Certain statements contained in this Current Report on Form 8-K 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 Current Report on Form 8-K.
> About Travelzoo (NASDAQ:TZOO)
Travelzoo Inc. (Travelzoo) is a media commerce company. The Company informs over 30 million members in Asia Pacific, Europe and North America, as well as various Website users, about the travel and entertainment deals available from a range of companies. The Company operates through three segments: Asia Pacific, Europe and North America. The Asia Pacific segment consists of the Company’s operations in Australia, China, Hong Kong, Japan, Taiwan and Southeast Asia. The Europe segment consists of the Company’s operations in France, Germany, Spain and the United Kingdom. The North America segment consists of Travelzoo’s operations in Canada and the United States. Its publications and products include the Travelzoo Websites, the Travelzoo Top 20 e-mail newsletter, the Newsflash e-mail alert service, the SuperSearch pay-per-click travel search tool, and the Travelzoo Network, a network of third-party Websites that list travel deals published by Travelzoo.
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