TripAdvisor 2014 Annual Report Download - page 140

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Compensation Program Objectives
Our executive compensation program is designed to attract, motivate and retain highly skilled employees in executive positions
with the business experience and acumen that management and the Compensation Committees believe are necessary for achievement
of our long-term business objectives and to ensure that the compensation provided to these executives remains competitive with the
compensation paid to similarly situated executives at comparable companies. The executive compensation program is also designed so
that it does not encourage our named executive officers to take unreasonable risks relating to our business. In addition, the executive
compensation program is designed to reward both short-term and long-term performance and to align the financial interests of our
named executive officers with the interests of our stockholders.
Management and the Compensation Committees evaluate both performance and compensation levels to ensure that we maintain
our ability to attract and retain outstanding employees in executive positions. To that end, management and the Compensation
Committees believe the executive compensation packages provided by TripAdvisor to our named executive officers should include
both cash and equity-based compensation.
Roles and Responsibilities
Role of the Compensation and Section 16 Committees
The Compensation Committee is appointed by the Board of Directors and consists entirely of directors who are “outside
directors” for purposes of Section 162(m) of the Code. The Compensation Committee currently consists of Ms. Singh Cassidy and
Messrs. Philips and Maffei, with Ms. Singh Cassidy acting as Chairperson of the Compensation Committee. The Compensation
Committee is responsible for (i) designing and overseeing our compensation with respect to our executive officers, including salary
matters, bonus plans and stock compensation plans and (ii) approving all grants of equity awards, but excluding matters governed by
Rule 16b-3 under the Exchange Act (for which the Section 16 Committee has responsibility as described below). Notwithstanding the
foregoing, the Compensation Committee has delegated to the Chief Executive Officer of the Company authority to grant certain types
of equity awards, subject to certain limitations, to employees other than executive officers.
The Section 16 Committee is also appointed by the Board of Directors and consists entirely of directors who are “non-employee
directors” for purposes of Rule 16b-3 under the Exchange Act. The Section 16 Committee currently consists of Ms. Singh Cassidy and
Mr. Philips. The Section 16 Committee is responsible for administering and overseeing matters governed by Rule 16b-3 under the
Exchange Act, including approving grants of equity awards to our named executive officers. Ms. Singh Cassidy is also the
Chairperson of the Section 16 Committee.
Role of Executive Officers
Management participates in reviewing and refining our executive compensation program. Mr. Kaufer, our President and Chief
Executive Officer, annually reviews the performance of TripAdvisor and each named executive officer with the Compensation
Committees and makes recommendations with respect to the appropriate base salary, annual cash bonus and grants of equity awards
for each named executive officer, other than in connection with compensation for himself. Based in part on these recommendations
and the other factors discussed below, the Compensation Committees review and approve the annual compensation package of each
named executive officer.
Role of Compensation Consultant
Pursuant to the Compensation Committee and Section 16 Committee Charter, the Compensation Committees may retain compensation
consultants for the purpose of assisting the Compensation Committees in their evaluation of the compensation for our named executive
officers. In 2014, the Compensation Committees retained Compensia, Inc. (“Compensia”), a management consulting firm providing
executive compensation advisory services to compensation committees and senior management, to assist in an evaluation of TripAdvisor’s
compensation peer group, to use the compensation peer group to compile and analyze competitive compensation market data for certain
executive officer positions and to advise on matters related to our long-term incentive compensation structure. The Compensation
Committees consider input from their compensation consultant as one factor in making decisions with respect to compensation matters, along
with information and analysis they receive from management and their own judgment and experience.
Based on consideration of the factors set forth in the rules of the SEC and NASDAQ, the Compensation Committees have determined
that their relationship with Compensia and the work performed by Compensia on behalf of the Compensation Committees has not raised any
conflict of interest. In addition, in compliance with the Compensation Committee and Section 16 Committee Charter, the Compensation
Committees approved the fees paid to Compensia for work performed in 2014 and confirm that such payments did not exceed $120,000.