TripAdvisor 2012 Annual Report Download - page 161

program generally available to all employees, including named executive officers, that provides for
reimbursement of up to $750 a year for leisure travel that is arranged using one of the TripAdvisor Media Group
family of products and provides all employees, including named executive officers, an annual holiday bonus in
the form of a gift card as well as a tax gross-up payment on the value of the gift card.
The Role of Peer Groups, Surveys and Benchmarking
Management considers multiple data sources when reviewing compensation information to ensure that the
data reflects compensation practices of relevant companies in terms of size, industry and geographic location.
Among other factors, management considers the following information in connection with its recommendations
to the Compensation Committees regarding compensation for named executive officers:
• data from salary and equity compensation surveys that include companies of a similar size, based on
market capitalization, revenues and other factors, and
• data regarding compensation for certain executive officer positions (e.g., chief executive officer and chief
financial officer) from recent proxy statements and other SEC filings of peer companies, which include:
(a) direct industry competitors, and (b) non-industry companies with which TripAdvisor commonly
competes for talent (including both regional and national competitors).
For purposes of establishing its compensation peer group for 2013, management recommended to, and
reviewed with, the Compensation Committees companies in technology, travel and/or e-commerce businesses
with which TripAdvisor competes for talent at both the executive and employee levels. The companies
constituting the compensation peer group for 2013, as approved by the Compensation Committees, are:
Akamai Technologies, Inc. Ancestry.com Inc.
Concur Technologies, Inc. Expedia, Inc.
Groupon, Inc. Homeaway.com, Inc.
LinkedIn Corporation Netflix, Inc.
Nuance Communications, Inc. Parametric Technology Corporation
priceline.com Incorporated Progress Software Corporation
salesforce.com, inc. Shutterfly, Inc.
Valueclick, Inc. WebMD Health Corp.
Workday, Inc. Zynga Inc.
When available, management considers competitive market compensation paid by other peer group
companies but does not attempt to maintain a certain target percentile within the peer group or otherwise rely
solely on such data when making recommendations to the Compensation Committees regarding compensation
for the named executive officers. Management and the Compensation Committees strive to incorporate flexibility
into the compensation programs and the assessment process to respond to and adjust for the evolving business
environment and the value delivered by the named executive officers.
Tax Matters
Section 162(m) of the Code generally permits a tax deduction to public corporations for compensation over
$1 million paid in any fiscal year to a corporation’s chief executive officer and certain other highly compensated
executive officers only if the compensation qualifies as being performance-based under Section 162(m).
Whenever possible, TripAdvisor endeavors to structure its compensation policies to qualify as performance-
based under Section 162(m). Nonetheless, from time to time certain nondeductible compensation may be paid
and the Board of Directors and the Compensation Committees reserve the authority to award nondeductible
compensation to executive officers in appropriate circumstances.
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