Priceline 2010 Annual Report Download - page 20

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In early 2011, as described more fully in the Compensation Discussion and Analysis of this proxy
statement, the Compensation Committee determined funds to be allocated to the 2010 bonus pool and amounts to
be paid to individual executive officers under the bonus plan.
Additional information on the Compensation Committee’s consideration of executive compensation is
addressed in the Compensation Discussion and Analysis in this proxy statement.
Nominating and Corporate Governance Committee. The Nominating and Corporate Governance
Committee consists of Messrs. James M. Guyette, Howard W. Barker, Jr. and Ralph M. Bahna. Mr. Guyette is
Chairman of the Nominating and Corporate Governance Committee. Each member of the Nominating and
Corporate Governance Committee is an independent director as determined by priceline.com’s Board of
Directors, based on the NASDAQ Stock Market’s listing rules. The Nominating and Corporate Governance
Committee’s primary purposes are to: (a) identify individuals believed to be qualified to become members of the
Board of Directors, consistent with criteria approved by the Board of Directors, and to select, or recommend to
the Board of Directors, the nominees to stand for election as directors at the annual meeting of stockholders; (b)
identify members of the Board of Directors qualified to fill vacancies on any committee of the Board of Directors
(including the Nominating and Corporate Governance Committee) and to recommend that the Board of Directors
appoint the identified member or members to the respective committee; (c) assess whether candidates to join the
Board of Directors would be “independent” under the rules of the NASDAQ Stock Market, Inc.; (d) establish
procedures to receive prompt notification of changes in a director’s circumstances that may affect his or her
qualifications or independence as a director and review such information and make recommendations as deemed
appropriate; (e) develop and recommend to the Board of Directors a set of corporate governance principles
applicable to the Company, and to review and consider the effectiveness of those principles at least once a year;
(f) review, at least annually, priceline.com’s Code of Business Conduct and Ethics and, if appropriate, make
recommendations to the Board of Directors of suggested modifications or changes; (g) assist management in the
preparation of the disclosure in priceline.com’s proxy statement regarding the operations of the Nominating and
Corporate Governance Committee and (h) design a process for the Board to conduct a self-evaluation.
A copy of the Nominating and Corporate Governance Committee’s Charter is available on the Investor
Relations section of the Company’s website (www.priceline.com) under the tab “Corporate Governance.” The
Nominating and Corporate Governance Committee met three times in 2010. The Nominating and Corporate
Governance Committee approved and recommended to the Board of Directors the eight director nominees
currently standing for re-election at the Annual Meeting.
Leadership Structure
Mr. Bahna, who is one of our independent directors, currently serves as Chairman of the Board of
Directors, and Mr. Boyd, who is also a member of the Board of Directors, currently serves as our Chief
Executive Officer. The Board has had a Chairman who is not the Chief Executive Officer and not otherwise a
company executive since 2004. The Board has determined that the most effective Board leadership structure for
the Company at the present time is for the Chief Executive Officer and Chairman of the Board positions to be
separate. The Board believes at this time that continuing to separate the Chief Executive Officer and the
Chairman of the Board roles enables Mr. Boyd to focus on the business strategy and operations of the Company,
while Mr. Bahna provides the independent leadership of the Board necessary for the Board to fulfill its
responsibilities. The Board retains the authority to modify this structure as and when appropriate to best address
the Company’s unique circumstances and to advance the best interests of its stockholders.
Board’s Oversight of Risk
Priceline.com’s risk management activities include the identification and assessment of the key risks
facing the Company among the universe of business risks (i.e., strategic, operational, financial and
regulatory/compliance). These risks are identified across the organization from multiple regions and functions,
in a process overseen by the Company’s internal audit function, which reports to the Audit Committee. The
Board reviews these risks on an annual basis after they have been identified and assessed by management. The
Board, or a Committee of the Board, regularly reviews the initiatives put in place to mitigate the effects of these
risks. These reviews include updates throughout the year from the businesses, regions and functions from which
the key risks arise. Depending on the risk, the update may be presented to the full Board or if appropriate to a
committee. Each Committee’s role is one of oversight, recognizing that management is responsible for executing
priceline.com’s risk management policies. The oversight of risk within the organization is an evolving process