TripAdvisor 2014 Annual Report Download - page 148

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In February 2014, based on input from Compensia, the Compensation Committees approved the following companies to
constitute the compensation peer group for purposes of serving as a referring in determining 2014 base salaries and equity awards for
our executive officers:
Software Companies B to C Internet Companies
Akamai Technologies, Inc. Expedia, Inc.
ANSYS, Inc. Groupon, Inc.
Citrix Systems, Inc. Homeaway.com, Inc.
Concur Technologies, Inc. IAC/InterActiveCorp.
FactSet Research Systems, Inc. LinkedIn Corp.
N
etSuite Inc.
N
etflix Inc.
N
uance Communications Pandora Media, Inc.
RedHat, Inc. priceline.com Incorporated
VeriSign, Inc. Shutterfly, Inc.
Workday, Inc. VistaPrint N.V.
The 2014 peer group remains unchanged from the peer group approved by the Compensation Committees in August, 2013.
When available, management and the Compensation Committees consider competitive market compensation paid by peer group
companies but does not attempt to maintain a certain target percentile within the compensation peer group or otherwise rely solely on
such data when making recommendations to the Compensation Committees regarding compensation for our named executive officers.
Management and the Compensation Committees strive to incorporate flexibility into our executive compensation program and the
assessment process to respond to and adjust for the evolving business environment and the value delivered by our 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 their chief executive officer and certain other highly compensated executive officers only if the compensation
qualifies as “performance-based compensation” for purposes of Section 162(m). The Compensation Committees endeavor to structure
the compensation of our executive officers to qualify as “performance-based compensation” when it deems such qualification to be in
the best interests of TripAdvisor and its stockholders. 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 our
executive officers in appropriate circumstances.
For purposes of enabling TripAdvisor to deduct the compensation paid to and recognized by our named executive officers in
accordance with Section 162(m) of the Code, the Compensation Committees sought to design the annual bonuses awarded to our
named executive officers for 2014 to qualify as “performance-based compensation” as described under “Compensation Program
Elements – Cash Bonuses” above.
Post-Employment Compensation
Change in Control
Under the 2011 Plan, Ms. Bradley and Messrs. Kaufer and Kalvert are entitled to accelerated vesting of certain of their outstanding and
unvested equity awards in the event of a change in control of TripAdvisor (i.e. a “single trigger” acceleration provision), although the
definition of a “change in control” in the 2011 Plan does not include the acquisition of voting control by Liberty or LTRIP. When the 2011
Plan was adopted, the Compensation Committees believed that accelerated vesting of equity awards in connection with change in control
transactions would provide an incentive for our named executive officers to continue to help execute successfully such a transaction from its
early stages until closing. Under the 2011 Plan, acceleration of equity awards and equity awards for all other employees is subject to double
trigger acceleration (i.e., accelerated vesting occurs only upon an involuntary termination of employment or resignation for “good reason”
during the two-year period following a change in control).
In August 2013, after further evaluation of the “single trigger” acceleration provisions, the Compensation Committees determined that
future equity awards made under the 2011 Plan would not be entitled to “single trigger” acceleration and, instead, the award agreements with
respect to such equity awards would provide that any acceleration of vesting of the equity awards would be subject to “double trigger” rather
than “single trigger” acceleration. This means that a vesting of outstanding and unvested equity awards granted on or after August 28, 2013,