Priceline 2010 Annual Report Download - page 29

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below or above “target” amounts, notwithstanding priceline.com’s financial performance. The 2010 Bonus Plan
did not provide for individual maximum amounts.
Priceline.com’s 2010 Performance and Funding of the 2010 Bonus. In the Committee’s judgment,
2010 was an excellent year for priceline.com. Both Booking.com and the Company, on a consolidated basis,
produced year-over-year non-GAAP EBITDA growth that substantially exceeded the targets established at the
beginning of 2010, and funding of the 2010 Bonus Plan substantially exceeded funding under the 2009 Bonus
Plan.
Individual Bonus Amounts. The sole determinant of the funding of each named executive officer’s
bonus – and the single most important consideration in the determination of the actual amount of each named
executive officer’s bonus – was the accomplishment by the Company on a consolidated basis and by
Booking.com, as applicable, of the non-GAAP EBITDA targets discussed above. The actual dollar amount of
each named executive officer’s bonus was determined after an assessment of such officer’s performance by, in
the case of the Chief Executive Officer, the Board of Directors and Compensation Committee and, in the case of
the other named executive officers, the Compensation Committee and the Chief Executive Officer. Final bonus
amounts for the named executive officers other than the Chief Executive Officer were based on a subjective
assessment by the Compensation Committee and the Chief Executive Officer of each officer’s performance and
contributions during 2010, as opposed to, in most cases, the accomplishment of specific quantitative goals. The
Compensation Committee exercised its discretion, based on the advice of the Chief Executive Officer, and did
not attempt to quantify, rank or assign specific weight to any single factor (other than the non-GAAP EBITDA
targets described above) in making its bonus decisions.
In early 2011, the Committee reviewed the Company’s 2010 results and worked with the Chief
Executive Officer to develop appropriate 2010 bonus amounts for the Company’s executive officers, other than
Mr. Boyd. As described above, the Committee also worked in executive session with Mercer and the Board of
Directors to develop an appropriate bonus amount for Mr. Boyd. The bonuses paid to the named executive
officers were paid in February 2011 and appear in the Summary Compensation Table for 2010 under the “Non-
Equity Incentive Plan Compensation” column.
Mr. Boyd. Based on the Company’s performance in 2010 and Mr. Boyd’s strong leadership, the
Committee and the Board of Directors authorized the Company to pay Mr. Boyd a $4,000,000 bonus for 2010.
The Company’s accomplishment of the consolidated non-GAAP EBITDA targets described above was the
exclusive determinant in calculating the funding of Mr. Boyd’s bonus and was the primary consideration in
determining the amount of Mr. Boyd’s ultimate bonus. From the Committee’s perspective, the Company’s
performance was an extraordinary accomplishment in any year, but even more impressive given the challenging
macro-economic conditions over recent years. In evaluating Mr. Boyd’s performance and arriving at his bonus,
the Committee and the Board of Directors also considered, among other things, the following:
x The Company’s 2010 “market leading” year-over-year growth (expressed in terms of consolidated
gross travel bookings) and profitability (expressed in terms of consolidated non-GAAP EBITDA);
x The Company’s ability during 2010 to maintain its operating leverage;
x The Company’s continued geographic expansion and expansion of its hotel supply around the world
during 2010 (including robust growth outside its core European markets);
x The global collaboration among the Company’s different brands;
x Mr. Boyd’s leadership during 2010, which included development of long-term strategy with the Board
of Directors and leadership of the organization, succession planning, and development of a deep
management team; and
x Mr. Boyd’s continued development of a healthy, open and constructive relationship with the Board of
Directors.