October 11, 2011

How to Cash In Your Free Travelzoo Stock

EDIT UPDATE Nov. 8th, 2013:    It looks like the information below may now be out of date.  The links I used before seem to differ from what I used.   I think Travelzoo may have hired Computershare to administer their shareholder services and I don't know what the current process to claim your old free TZOO shares would be now.  

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Earlier this year I wrote about how I had cashed out my old Travelzoo shares for $xxx.     Since then a couple people have asked about the process for getting your shares.   Wolf asked via Facebook :

"Recalling a post possibly from early this year, how did you verify with Travelzoo that you were a stockholder?  I had some shares, but don't recall if I registered them with Delaware when they had some sort of organization change."

I'm sure there are many other people out there who got those free Travelzoo shares and then never obtained the shares or cashed them in.   You can get those shares with a little bit of leg work.      As I write this Travelzoo (TZOO) is trading at $21.60.   You aren't going to get rich off this but if you have 8 shares like I did then thats $172 in stock you own.


Travelzoo has a section on their website for shareholder services.

From there you'll see the following options :


· Transfer Travelzoo Inc. stock into your brokerage account
 

· Update your contact information
 

· View your account with Travelzoo Inc. online
 

· Revoke consent to electronic communications
 

· FAQs
 

· Contact 


To get your shares you'll need to know the email you originally started with.


Step by Step process to get your Travelzoo shares

1. Recover your account number and password If you have access to your original email account then enter it on the page to recover your account information.    Travelzoo will then send you an email with your account number and password.  
- or - 
If you can no longer access that old email account then you can still get your info.  Enter the email address on the recovery page and then they will tell you the physical address you can send a snail mail request to.  You'll have to then send them a letter with your info to request your account info. 

2.  Log into your account and possibly update your contact info  Once you have your account # and password you can log into your account at   View your account with Travelzoo Inc. online    Theres not a whole lot to see on this page, it tells you the # of shares you own.    But when you log in you also want to verify that they have your name and address right.   If you need to update your address or otherwise fix something then do so at their page to Update your contact information.    On that page you can change your email and physical address.   If you have the same bad luck as me and they spelled your name wrong then you'll have to send them a letter to ask them to fix that.


3. Get your shares.   To get your shares you have to go to the page Transfer Travelzoo Inc. stock into your brokerage account  and from there you follow the 2 step process : 


Step 1:
Create and mail a "Request for Physical Delivery of Common Stock Certificate" form to Travelzoo's transfer agent, Computershare Trust Company, N.A.
Step 2:
Send the stock certificate which you will receive from Computershare Trust Company, N.A. to your broker.
Basically in step #1 they give you a form "Request for Physical Delivery of Common Stock Certificate" which you print out and then can fill in.   To do that form you need to get it signed with a Medallion Guarantee.   Notary public is not good enough and you need the Medallion Guarantee, (which they clearly say on the form once you get to that point).   I previously talked about how to get a Medallion Guarantee and you can get them at a lot of banks or brokerages.


4.  Get a broker if you need one   Once you fill out the form and get the physical stock certificate from step #3 you can then deliver the paper stock certificate to your broker.   If you don't have a broker then you'll need to find one.      You can choose whatever broker you want.   Many brokers have a minimum amount to open an account and if all you want to do is sell a few shares of Travelzoo then that could be a problem.   My understanding is that TD Ameritrade accounts can be opened with no minimum and their commission on trades is $9.99.   Thats just one option and there are many brokers out there that will work.  


5. Sell the shares.   Deliver the shares to your broker and then once they are registered in your account you can sell them on the open market or hang on to them.   


6.  Remember to pay the taxes.   The shares you got were free so the cost was $0.   If you sell them then you'll owe tax on the entire amount.   You would have owned the shares for many years since they were originally given out free over a decade ago so it will be a long term capital gain. 


An alternative to selling the shares via a broker is to give the shares to a charity.   If you choose this method then you could donate the shares to the charity of your choice directly.   This will get you a possible tax deduction if you itemize and you won't have to pay tax on the gains.

You could also just keep the shares.    If you don't want to cash them out then you can simply hang on to the shares.   In fact if you just want to hang on to them then you could just let them sit in Travelzoo's hands.  The only real problem with that is you don't have the flexibility to sell quickly since getting the shares into your hands can take a while.



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