Exhibit 10.2

Execution Copy

priceline.com Incorporated

0.50% Convertible Senior Notes due 2011
0.75% Convertible Senior Notes due 2013

Registration Rights Agreement

September 27, 2006       

Goldman, Sachs & Co.,
As representative of the several Purchasers
    named in Schedule I to the Purchase Agreement
85 Broad Street
New York, New York 10004

Ladies and Gentlemen:

Priceline.com Incorporated, a Delaware corporation (the “Company”), proposes to
issue and sell to the Purchasers (as defined herein) upon the terms set forth in
the Purchase Agreement (as defined herein) its 0.50% Convertible Senior Notes
due 2011 (the “2011 Notes”) and its 0.75% Convertible Senior Notes due 2013 (the
“2013 Notes” and, together with the 2011 Notes, the “Securities”).  As an
inducement to the Purchasers to enter into the Purchase Agreement and in
satisfaction of a condition to the obligations of the Purchasers thereunder, the
Company agrees with the Purchasers for the benefit of Holders (as defined
herein) from time to time of the Registrable Securities (as defined herein) as
follows:

1.    Definitions.

(a)           Capitalized terms used herein without definition shall have the
meanings ascribed to them in the Purchase Agreement.  As used in this Agreement,
the following defined terms shall have the following meanings:

“Affiliate” of any specified person means any other person which, directly or
indirectly, is in control of, is con­trolled by, or is under common control with
such specified person.  For purposes of this definition, control of a person
means the power, direct or indirect, to direct or cause the direction of the
management and policies of such person whether by contract or otherwise; and the
terms “controlling” and “controlled” have meanings correlative to the foregoing.

“Closing Date” means the First Time of Delivery as defined in the Purchase
Agreement.

“Commission” means the United States Securities and Exchange Commission, or any
other federal agency at the time administering the Exchange Act or the
Securities Act, whichever is the relevant statute for the particular purpose.

 

--------------------------------------------------------------------------------

 

“Common Stock” means the Company’s common stock, par value $0.008 per share.

“DTC” means The Depository Trust Company.

“Effective Date” has the meaning assigned thereto in Section 2(b)(i) hereof..

“Effective Failure” has the meaning assigned thereto in Section 7(b) hereof.

“Effectiveness Period” has the meaning assigned thereto in Section 2(b)(i)
hereof.

“Effective Time” means the time at which the Commission declares the Shelf
Registration Statement effec­tive or at which the Shelf Registration Statement
otherwise becomes effective.

“Electing Holder” has the meaning assigned thereto in Section 3(a)(iii) hereof.

“Exchange Act” means the United States Securities Exchange Act of 1934, as
amended.

“Holder” means any person that is the record owner of Registrable Securities
(and includes any person that has a beneficial interest in any Registrable
Security in book-entry form).

“Indenture” means the Indenture, dated as of September 27, 2006, between the
Company and American Stock Transfer and Trust Company, as amended and
supplemented from time to time in accordance with its terms.

“Liquidated Damages” has the meaning assigned thereto in Section 7(a) hereof.

“Managing Underwriters” means the investment banker or investment bankers and
manager or managers that shall administer an underwritten offering, if any,
conducted pursuant to Section 6 hereof.

“NASD Rules” means the Rules of the National Association of Securities Dealers,
Inc., as amended from time to time.

“Notice and Questionnaire” means a Notice of Registration Statement and Selling
Securityholder Questionnaire substantially in the form of Appendix A hereto.

The term “person” means an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.

“Prospectus” means the prospectus (including, without limitation, any
preliminary prospectus, any final prospectus and any prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A under the Securities Act)
included in the Shelf Registration Statement, as amended or supplemented by any
prospectus supplement with respect to the terms of the offering of any portion
of the Registrable Securities covered by the Shelf Registration Statement and by
all other amendments and supplements to such prospectus, including all material
incorporated by

2

--------------------------------------------------------------------------------

 

reference in such prospectus and all documents filed after the date of such
prospectus by the Company under the Exchange Act and incorporated by reference
therein.

“Purchase Agreement” means the purchase agreement, dated as of
September 21, 2006, between the Purchasers and the Company relating to the
Securities.

“Purchasers” means the Purchasers named in Schedule I to the Purchase Agreement.

“Registrable Securities” means all or any portion of the Securities issued from
time to time under the Indenture in registered form and the shares of Common
Stock issuable upon conversion, repurchase or redemption of such Securities;
provided, however, that a security ceases to be a Registrable Security when it
is no longer a Restricted Security.

“Registration Default” has the meaning assigned thereto in Section 7(a) hereof.

“Restricted Security” means any Security or share of Common Stock issuable upon
conversion thereof except any such Security or share of Common Stock that
(i) has been effectively registered under the Securities Act and sold in a
manner contemplated by the Shelf Registration Statement, (ii) has been
transferred in compliance with Rule 144 under the Securities Act (or any
successor provision thereto) or is transferable pursuant to paragraph (k) of
such Rule 144 (or any successor provision thereto) or (iii) has otherwise been
transferred and a new Security or share of Common Stock not subject to transfer
restrictions under the Securities Act has been delivered by or on behalf of the
Company in accordance with Section 3.5 of the Indenture.

“Rules and Regulations” means the published rules and regulations of the
Commission promulgated under the Securities Act or the Exchange Act, as in
effect at any relevant time.

“Securities Act” means the United States Securities Act of 1933, as amended.

“Shelf Registration” means a registration effected pursuant to Section 2 hereof.

“Shelf Registration Statement” means a “shelf” registration statement filed
under the Securities Act providing for the registration of, and the sale on a
continuous or delayed basis by the Holders of, all of the Registrable Securities
pursuant to Rule 415 under the Securities Act and/or any similar rule that may
be adopted by the Commission, filed by the Company pursuant to the provisions of
Section 2 of this Agreement, including the Prospectus contained therein, any
amendments and supplements to such registration statement, including
post-effective amendments, and all exhibits and all material incorporated by
reference in such registration statement.

“Trust Indenture Act” means the Trust Indenture Act of 1939, or any successor
thereto, and the rules, regulations and forms promulgated thereunder, as the
same shall be amended from time to time.

The term “underwriter” means any underwriter of Registrable Securities in
connection with an offering thereof under a Shelf Registration Statement.

3

--------------------------------------------------------------------------------

 

(b)  Wherever there is a reference in this Agreement to a percentage of the
“principal amount” of Registrable Securities or to a percentage of Registrable
Securities, Common Stock shall be treated as representing the principal amount
of Securities that was surrendered for conversion or exchange in order to
receive such number of shares of Common Stock.

2.    Shelf Registration.

(a)  The Company shall, no later than 90 calendar days following the Closing
Date, file with the Commission a Shelf Registration Statement relating to the
offer and sale of the Registrable Securities by the Holders from time to time in
accordance with the methods of distribution elected by such Holders and set
forth in such Shelf Registration Statement and, there­after, shall use its best
efforts to cause such Shelf Registration Statement to be declared effective
under the Securities Act no later than 180 calendar days following the Closing
Date; provided, however, that the Company may, upon written notice to all
Holders, postpone having the Shelf Registration Statement declared effective for
a reasonable period not to exceed 90 days if the Company possesses material
non-public information, the disclosure of which would have a material adverse
effect on the Company and its subsidiaries taken as a whole; provided, further,
however, that no Holder shall be entitled to be named as a selling
securityholder in the Shelf Registration Statement or to use the Prospectus
forming a part thereof for resales of Registrable Securities unless such Holder
is an Electing Holder.

(b)  The Company shall use its best efforts:

(i)            to keep the Shelf Registration Statement con­tinuously effective
under the Securities Act in order to permit the Prospectus forming a part
thereof to be usable by Holders until the earliest of (1) the sale of all
Registrable Securities registered under the Shelf Registration Statement; (2)
the expiration of the period referred to in Rule 144(k) of the Securities with
respect to all Registrable Securities held by Persons that are not Affiliates of
the Company; and (3) two years from the date (the “Effective Date”) such Shelf
Registration Statement is declared effective (such period being referred to
herein as the “Effectiveness Period”);

 (ii)          after the Effective Time of the Shelf Registration Statement,
promptly upon the request of any Holder of Registrable Securities that is not
then an Electing Holder, to take any action reasonably necessary to enable such
Holder to use the Prospectus forming a part thereof for resales of Registrable
Securities, including, without limitation, any action necessary to identify such
Holder as a selling securityholder in the Shelf Registration Statement;
provided, however, that nothing in this subparagraph shall relieve such Holder
of the obligation to return a completed and signed Notice and Questionnaire to
the Company in accordance with Section 3(a)(ii) hereof; and

(iii)          if at any time the Securities, pursuant to Article XII of the
Indenture, are convertible into securities other than Common Stock, to cause, or
to cause any successor under the Indenture to cause, such securities to be
included in the Shelf Registration Statement no later than the date on which the
Securities may then be convertible into such securities.

4

--------------------------------------------------------------------------------

 

The Company shall be deemed not to have used its best efforts to keep the Shelf
Registration Statement effective during the requisite period if the Company
voluntarily takes any action that would result in Holders of Registrable
Securities covered thereby not being able to offer and sell any of such
Registrable Securities during that period, unless such action is (A) required by
applicable law and the Company there­after promptly complies with the
requirements of paragraph 3(j) below or (B) permitted pursuant to Section 2(c)
below.

(c)  The Company may suspend the use of the Prospectus for a period not to
exceed 30 days in any 90-day period or an aggregate of 90 days in any 12-month
period if the Board of Directors of the Company shall have determined in good
faith that because of valid business reasons (not including avoidance of the
Company’s obligations hereunder), including the acquisition or divestiture of
assets, pending corporate developments, public filings with the Commission and
similar events, it is in the best interests of the Company to suspend such use,
and prior to suspending such use the Company provides the Holders with written
notice of such suspension, which notice need not specify the nature of the event
giving rise to such suspension.

3.    Registration Procedures.  In connection with the Shelf Registration
Statement, the following provisions shall apply:

(a) (i)              Not less than 30 calendar days prior to the Effective Time
of the Shelf Registration Statement, the Company shall mail the Notice and
Questionnaire to the Holders of Registrable Securities.  No Holder shall be
entitled to be named as a selling securityholder in the Shelf Registration
Statement as of the Effective Time, and no Holder shall be entitled to use the
Prospectus forming a part thereof for resales of Registrable Securities at any
time, unless such Holder has returned a completed and signed Notice and
Questionnaire to the Company by the deadline for response set forth therein;
provided, however, Holders of Registrable Securities shall have at least 28
calendar days from the date on which the Notice and Questionnaire is first
mailed to such Holders to return a completed and signed Notice and Questionnaire
to the Company.

(ii)  After the Effective Time of the Shelf Registration Statement, the Company
shall, upon the request of any Holder of Registrable Securities that is not then
an Electing Holder, promptly send a Notice and Questionnaire to such Holder. 
The Company shall not be required to take any action to name such Holder as a
selling securityholder in the Shelf Registration Statement or to enable such
Holder to use the Prospectus forming a part thereof for resales of Registrable
Securities until such Holder has returned a completed and signed Notice and
Questionnaire to the Company.

(iii) The term “Electing Holder” shall mean any Holder of Registrable Securities
that has returned a completed and signed Notice and Questionnaire to the Company
in accordance with Section 3(a)(i) or 3(a)(ii) hereof.

(b)  The Company shall furnish to each Electing Holder, prior to the Effective
Time, a copy of the Shelf Registration Statement initially filed with the
Commission, and shall furnish to such Holders, promptly after the filing thereof
with the Commission, copies of each amendment thereto and each amend­ment or
supplement, if any, to the Prospectus included therein.

5

--------------------------------------------------------------------------------

 

(c)  The Company shall promptly take such action as may be necessary so that (i)
each of the Shelf Registration Statement and any amendment thereto and the
Prospectus forming a part thereof and any amendment or supplement thereto (and
each report or other docu­ment incorporated therein by reference in each case)
complies in all material respects with the Securities Act and the Exchange Act
and the respective rules and regulations thereunder, (ii) each of the Shelf
Registration Statement and any amendment thereto does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the state­ments
therein not misleading and (iii) each of the Prospectus forming a part of the
Shelf Registration Statement, and any amendment or supplement to such
Prospectus, does not at any time during the Effectiveness Period include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that the Company shall
not be required to take such action in respect of the Shelf Registration
Statement or any amendment thereto or of the Prospectus or any amendment or
supplement to the Prospectus if the Board of Directors of the Company has made a
determination pursuant to Section 2(c) for so long as such suspension is
continuing.

(d)    The Company shall promptly advise each Electing Holder, and shall confirm
such advice in writing if so requested by any such Electing Holder:

(i)          when a Shelf Registration Statement and any amendment thereto has
been filed with the Commission and when a Shelf Registration State­ment or any
post-effective amendment thereto has become effective, and in the case of the
filing of and the effectiveness of the initial Shelf Registration Statement (not
including any post-effective amendments thereto) making a public announcement
thereof by release made to Reuters Economic Services and Bloomberg Business
News;

(ii)       of any request by the Commission for amendments or supplements to the
Shelf Registra­tion Statement or the Prospectus included therein or for
additional information;

(iii)    of the issuance by the Commission of any stop order suspending the
effectiveness of the Shelf Registration Statement or the initiation of any
proceedings for such purpose;

(iv)   of the receipt by the Company of any notification with respect to the
suspension of the qualification of the securities included in the Shelf
Registration Statement for sale in any jurisdiction or the initi­a­tion of any
proceeding for such purpose; and

(v)      of the occurrence of any event or the existence of any state of facts
that requires the making of any changes in the Shelf Registra­tion Statement or
the Prospectus included therein so that, as of such date, such Shelf
Registration Statement and Prospectus do not contain an untrue statement of a
material fact and do not omit to state a material fact required to be stated
therein or necessary to make the statements therein (in the case of the
Prospectus, in light of the circum­stances under which they

6

--------------------------------------------------------------------------------

 

were made) not misleading (which advice shall be accompanied by an instruc­tion
to such Holders to suspend the use of the Prospectus until the requisite changes
have been made).

(e)  The Company shall use its best efforts to prevent the issuance, and if
issued to obtain the withdrawal at the earliest possible time, of any order
suspending the effectiveness of the Shelf Registration Statement.

(f)   The Company shall furnish to each Electing Holder, with­out charge, at
least one copy of the Shelf Registra­tion Statement and all post-effective
amendments thereto, including financial statements and schedules, and, if such
Electing Holder so requests in writing, all reports, other documents and
exhibits that are filed with or incorpor­ated by reference in the Shelf
Registration Statement.

(g)  The Company shall, during the Effectiveness Period, deliver to each
Electing Holder, without charge, as many copies of the Prospectus (including
each prelim­inary Prospectus) included in the Shelf Registration Statement and
any amendment or supplement thereto as such Electing Holder may reasonably
request; and the Company consents (except during the periods specified in
Section 2(c) above or during the continuance of any event or the existence of
any state of facts described in Section 3(d)(v) above) to the use of the
Prospec­tus and any amend­ment or supplement thereto by each of the Electing
Holders in connection with the offering and sale of the Registrable Securities
covered by the Prospectus and any amendment or supple­ment thereto during the
Effectiveness Period.

(h)  Prior to any offering of Registrable Securities pursuant to the Shelf
Registration Statement, the Company shall (i) register or qualify or cooperate
with the Electing Holders and their respective counsel in connection with the
registration or quali­fication of such Registrable Securities for offer and sale
under the securities or “blue sky” laws of such jurisdictions within the United
States as any Electing Holder may reasonably request, (ii) keep such
registrations or qualifications in effect and comply with such laws so as to
permit the continuance of offers and sales in such jurisdictions for so long as
may be necessary to enable any Electing Holder or underwriter, if any, to
complete its distribution of Registrable Securities pursuant to the Shelf
Registration Statement, and (iii) take any and all other actions necessary or
advisable to enable the  disposition in such jurisdictions of such Registrable
Securities; provided, however, that in no event shall the Company be obligated
to (A) qualify as a foreign corporation or as a dealer in securities in any
jurisdiction where it would not otherwise be required to so qualify but for this
Sec­tion 3(h) or (B) file any general consent to service of process in any
jurisdiction where it is not as of the date hereof so subject.

(i)   Unless any Registrable Securities shall be in book-entry only form, the
Company shall cooperate with the Electing Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold pursuant to the Shelf Registration Statement, which certificates, if so
required by any securities exchange upon which any Registrable Securities are
listed, shall be penned, lithographed or engraved, or produced by any
combination of such methods, on steel engraved borders, and which certificates
shall be free of any restrictive legends and in such permitted denominations and
registered in such names as

7

--------------------------------------------------------------------------------

 

 

Electing Holders may request in connection with the sale of Registrable
Securities pursuant to the Shelf Registration Statement.

(j)   Upon the occurrence of any event or the existence of any state of facts
contemplated by paragraph 3(d)(v) above, the C­ompany shall promptly prepare a
post-effective amend­ment to any Shelf Registration Statement or an amendment or
supplement to the related Prospectus or file any other required document so
that, as thereafter delivered to Purchasers of the Registrable Securities
included therein, the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company shall not be required
to file such amendment, supplement or document if the Board of Directors of the
Company has made a determination pursuant to Section 2(c) for so long as such
suspension is continuing.  If the Company notifies the Electing Holders of the
occurrence of any event or the existence of any state of facts contemplated by
Section 2(c) or paragraph 3(d)(v) above, the Electing Holder shall suspend the
use of the Prospectus until the requisite changes to the Prospectus have been
made.

(k)  Not later than the Effective Time of the Shelf Registration Statement, the
Company shall provide a CUSIP number for the Registrable Securi­ties that are
debt securities.

(l)   The Company shall use its best efforts to comply with all applicable Rules
and Regulations, and to make generally available to its secu­rityholders as soon
as practicable, but in any event not later than eighteen months after (i) the
effective date (as defined in Rule 158(c) under the Securities Act) of the Shelf
Registration Statement, (ii) the effective date of each post-effective amendment
to the Shelf Regis­tration Statement, and (iii) the date of each filing by the
Company with the Commission of an Annual Report on Form 10-K that is
incor­porated by reference in the Shelf Registration Statement, an earning
statement of the Company and its sub­sid­iaries complying with Section 11(a) of
the Securities Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158).

(m) Not later than the Effective Time of the Shelf Registration Statement, the
Company shall cause the Indenture to be qualified under the Trust Indenture Act;
in connection with such qualification, the Company shall cooperate with the
Trustee under the Indenture and the Holders (as defined in the Indenture) to
effect such changes to the Indenture as may be required for such Indenture to be
so qualified in accordance with the terms of the Trust Indenture Act; and the
Company shall execute, and shall use all reasonable efforts to cause the Trustee
to execute, all documents that may be required to effect such changes and all
other forms and documents required to be filed with the Commission to enable
such Indenture to be so qualified in a timely manner.  In the event that any
such amendment or modification referred to in this Section 3(m) involves the
appointment of a new trustee under the Indenture, the Company shall appoint a
new trustee thereunder pursuant to the applicable provisions of the Indenture.

(n)  In the event of an underwritten offering conducted pursuant to Section 6
hereof, the Company shall, if requested, promptly include or incorporate in a
Prospectus supplement or post-effective amendment to the Shelf Registration
Statement such information as the Managing Underwriters reasonably agree should
be included therein and to which the Company does not reasonably object and
shall make all required filings of such Prospectus supplement or post-

8

--------------------------------------------------------------------------------

 

 

effective amendment as soon as practicable after it is notified of the matters
to be included or incorporated in such Prospectus supplement or post-effective
amendment.

(o)           The Company shall enter into such customary agreements (including
an underwriting agreement in customary form in the event of an underwritten
offering conducted pursuant to Section 6 hereof) and take all other appropriate
action in order to expedite and facilitate the registration and disposition of
the Registrable Securities, and in connection therewith, if an under­writing
agreement is entered into, cause the same to contain indemnification provisions
and procedures substantially identical to those set forth in Section 5 hereof
with respect to all parties to be indemnified pursuant to Section 5 hereof.

(p)           The Company shall:

(i)(A)  make reasonably available for inspection by the Electing Holders, any
underwriter participating in any disposition pursuant to the Shelf Registration
Statement, and any attorney, accountant or other agent retained by such Electing
Holders or any such underwriter all relevant financial and other records,
pertinent corporate documents and properties of the Company and its
subsidiaries, and (B) cause the Company’s officers, directors and employees to
supply all information reasonably requested by such Electing Holders or any such
underwriter, attorney, accountant or agent in connection with the Shelf
Registration Statement, in each case, as is customary for similar due diligence
exam­inations; provided, however, that all records, information and documents
that are designated in writing by the Company, in good faith, as confidential
shall be kept confi­dential by such Electing Holders and any such underwriter,
attorney, accountant or agent, unless such disclosure is made in connection with
a court proceeding or required by law, or such records, information or documents
become available to the public generally or through a third party without an
accompanying obligation of confidentiality; and provided further that, if the
foregoing inspection and information gathering would otherwise disrupt the
Company’s conduct of its business, such inspection and information gathering
shall, to the great­est extent possible, be coordinated on behalf of the
Electing Holders and the other parties entitled thereto by one counsel
designated by and on behalf of the Electing Holders and other parties;

(ii)  in connection with any underwritten offering conducted pursuant to
Section 6 hereof, make such repre­sen­tations and warranties to the Electing
Holders participating in such underwritten offering and to the Managing
Underwriters, in form, substance and scope as are customarily made by the
Company to underwriters in primary underwritten offerings of equity and
convertible debt securities and cov­ering matters including, but not limited to,
those set forth in the Purchase Agreement;

(iii) in connection with any underwritten offering conducted pursuant to
Section 6 hereof, obtain opinions of counsel to the Company (which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to the
Managing Underwriters) addressed to each Electing Holder participating in such
under­written offering and the underwriters, covering such matters as are
customarily covered in opinions requested in primary under­written offerings of
equity and convertible debt securities and such other matters as may be
reasonably requested by such Electing

9

--------------------------------------------------------------------------------

 

Holders and underwriters (it being agreed that the matters to be covered by such
opinions shall include, without limitation a statement by such counsel that
nothing came to the attention of such counsel in the course of their review that
the Shelf Registration Statement and the Prospectus, including the documents
incorporated by reference therein (other than the financial statements or other
financial data therein, as to which such counsel need express no opinion or
belief), as of the Effective Time of the Shelf Registration Statement or most
recent post-effective amendment thereto, as the case may be, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein necessary in order to make the statements therein
not misleading;

(iv) in connection with any underwritten offering conducted pursuant to
Section 6 hereof, obtain “cold comfort” letters and updates thereof from the
independent public accountants of the Company (and, if necessary, from the
independent pub­lic accountants of any subsidiary of the Company or of any
business acquired by the C­ompany for which financial statements and finan­cial
data are, or are required to be, included in the Shelf Registration Statement),
addressed to each Electing Holder participating in such underwritten offering
(if such Electing Holder has provided such letter, representations or
documentation, if any, required for such cold comfort letter to be so addressed)
and the underwriters, in customary form and covering matters of the type
customarily covered in “cold comfort” letters in connection with primary
under­written offerings;

(v)  in connection with any underwritten offering conducted pursuant to
Section 6 hereof, deliver such documents and certificates as may be reasonably
requested by any Electing Holders participating in such underwritten offering
and the Managing Underwriters, if any, including, without limitation,
certificates to evidence compliance with Section 3(j) hereof and with any
conditions contained in the underwriting agreement or other agreements entered
into by the Company.

(q)  The Company will use its best efforts to cause the Common Stock issuable
upon conversion of the Securities to be quoted on the Nasdaq National Market
System or other stock exchange or trading system on which the Common Stock
primarily trades on or prior to the Effective Time of the Shelf Registration
State­ment hereunder.

(r)   In the event that any broker-dealer registered under the Exchange Act
shall be an “affiliate” (as defined in Rule 2720(b)(1) of the NASD Rules (or any
successor provision thereto)) of the Company or has a “conflict of interest” (as
defined in Rule 2720(b)(7) of the NASD Rules (or any successor provision
thereto)) and such broker-dealer shall underwrite, participate as a member of an
underwriting syndicate or selling group or assist in the distribution of any
Registrable Securities covered by the Shelf Registration Statement, whether as a
Holder of such Registrable Securities or as an underwriter, a placement or sales
agent or a broker or dealer in respect thereof, or otherwise, the Company shall
assist such broker-dealer in complying with the requirements of the NASD Rules,
including, without limitation, by (A) engaging a “qualified independent
underwriter” (as defined in Rule 2720(b)(15) of the NASD Rules (or any successor
provision thereto)) to participate in the preparation of the registration
statement relating to such Registrable Securities, to exercise usual standards
of due diligence in

10

--------------------------------------------------------------------------------

 

 

respect thereto and to recommend the public offering price of such Registrable
Securities, (B) indemnifying such qualified independent underwriter to the
extent of the indemnification of underwriters provided in Section 5 hereof, and
(C) providing such information to such broker-dealer as may be required in order
for such broker-dealer to comply with the requirements of the NASD Rules.

(s)  The Company shall use its best efforts to take all other steps necessary to
effect the registration, offering and sale of the Registrable Securities covered
by the Shelf Registra­tion Statement contem­plated hereby.

4.    Registration Expenses.  Except as otherwise provided in Section 3, the
Company shall bear all fees and expenses incurred in connection with the
performance of its obligations under Sections 2, 3 and 6 hereof and shall bear
or reimburse the Electing Holders for the reasonable fees and disbursements of a
single counsel selected by a plurality of all Electing Holders who own an
aggregate of not less than 25% of the Registrable Securities covered by the
Shelf Registration Statement to act as counsel therefore in connection
therewith.  Each Electing Holder shall pay all underwriting discounts and
commissions and transfer taxes, if any, relating to the sale or disposition of
such Electing Holder’s Registrable Securities pursuant to the Shelf Registration
Statement.

5.    Indemnification and Contribution.

(a)  Indemnification by the Company. Upon the registration of the Registrable
Securities pursuant to Section 2 hereof, the Company shall  indemnify and hold
harmless each Electing Holder and each underwriter, selling agent or other
securities professional, if any, which facilitates the disposition of
Registrable Securities, and each of their respective officers and directors and
each person who controls such Electing Holder, underwriter, selling agent or
other securities professional within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act (each such person being sometimes referred
to as an “Indemnified Person”) against any losses, claims, damages or
liabilities, joint or several, to which such Indemnified Person may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Shelf Registration Statement under which such Registrable
Securities are to be registered under the Securities Act, or any Prospectus
contained therein or furnished by the Company to any Indemnified Person, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and the
Company hereby agrees to reimburse such Indemnified Person for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that the Company shall not be liable to any such Indemnified Person in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made in such Shelf Registration Statement or
Prospectus, or amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by such Indemnified Person
expressly for use therein.

 

11

--------------------------------------------------------------------------------

 

(b)           Indemnification by the Electing Holders and any Agents and
Underwriters.  Each Electing Holder agrees, as a consequence of the inclusion of
any of such Electing Holder’s Registrable Securities in such Shelf Registration
Statement, and each underwriter, selling agent or other securities professional,
if any, which facilitates the disposition of Registrable Securities shall agree,
as a consequence of facilitating such disposition of Registrable Securities,
severally and not jointly, to (i) indemnify and hold harmless the Company, its
directors, officers who sign any Shelf Registration Statement and each person,
if any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any losses, claims,
damages or liabilities to which the Company or such other persons may become
subject, under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in such Shelf Registration Statement or Prospectus, or any amendment
or supplement, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by such Electing
Holder, underwriter, selling agent or other securities professional expressly
for use therein, and (ii) reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or defending
any such action or claim as such expenses are incurred.

(c)           Notices of Claims, Etc.  Promptly after receipt by an indemnified
party under subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is to be
made against an indemnifying party under this Section 5, notify such
indemnifying party in writing of the commencement thereof; but the omission so
to notify the indemnifying party shall not relieve it from any liability which
it may have to any indemnified party otherwise than under the indemnification
provisions of or contemplated by subsection (a) or (b) above.  In case any such
action shall be brought against any indemnified party and it shall notify an
indemnifying party of the commencement thereof, such indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, such indemnifying party shall
not be liable to such indemnified party under this Section 5 for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act, by
or on behalf of any indemnified party.

12

--------------------------------------------------------------------------------

 

(d)           Contribution.  If the indemnification provided for in this Section
5 is unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the indemnifying party and the indemnified party in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations.  The relative fault of such indemnifying party and
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by
such indemnifying party or by such indemnified party, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.  The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 5(d) were determined by
pro rata allocation (even if the Electing Holders or any underwriters, selling
agents or other securities professionals or all of them were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations re­ferred to in this Section 5(d). 
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
shall be deemed to include any legal or other fees or expenses reasonably
incurred by such indemni­fied party in connection with investigating or
defending any such action or claim.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.  The obligations of the Electing Holders and any
underwriters, selling agents or other securities professionals in this Section
5(d) to contribute shall be several in proportion to the percentage of principal
amount of Registrable Securities registered or underwritten, as the case may be,
by them and not joint.

(e)           Notwithstanding any other provision of this Section 5, in no event
will any (i) Electing Holder be required to undertake liability to any person
under this Section 5 for any amounts in excess of the dollar amount of the
proceeds to be received by such Holder from the sale of such Holder’s
Registrable Securities (after deducting any fees, discounts and commissions
applicable thereto) pursuant to any Shelf Registration Statement under which
such Registrable Securities are to be registered under the Securities Act and
(ii) underwriter, selling agent or other securities professional be required to
undertake liability to any person hereunder for any amounts in excess of the
discount, commission or other compensation payable to such underwriter, selling
agent or other securities professional with respect to the Registrable
Securities underwritten by it and distributed to the public.

(f)            The obligations of the Company under this Section 5 shall be in
addition to any liability which the Company may otherwise have to any
Indemnified Person and the obligations of any Indemnified Person under this
Section 5 shall be in addition to any liability which such Indemnified Person
may otherwise have to the Company.  The remedies provided in this Section 5 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to an indemnified party at law or in equity.

13

--------------------------------------------------------------------------------

 

6.             Underwritten Offering.  Any Holder of Registrable Securities who
desires to do so may sell Registrable Securities (in whole or in part) in an
underwritten offering; provided that  (i) the Electing Holders of at least
33-1/3% in aggregate principal amount of the Registrable Securities then covered
by the Shelf Registration Statement shall request such an offering and (ii) at
least such aggregate principal amount of such Registrable Securities shall be
included in such offering; and provided further that the Company shall not be
obligated to cooperate with more than one underwritten offering during the
Effectiveness Period.  Upon receipt of such a request, the Company shall provide
all Holders of Registrable Securities written notice of the request, which
notice shall inform such Holders that they have the opportunity to participate
in the offering.  In any such under­written offering, the investment banker or
bankers and manager or managers that will administer the offering will be
selected by, and the underwriting arrangements with respect thereto (including
the size of the offering) will be approved by, the holders of a majority of the
Registrable Securities to be included in such offering; provided, however, that
such investment bankers and managers and underwriting arrangements must be
reasonably satisfactory to the Company.  No Holder may participate in any
underwritten offering contemplated hereby unless (a) such Holder agrees to sell
such Holder’s Registrable Securities to be included in the underwritten offering
in accordance with any approved underwriting arrangements, (b) such Holder
completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
required under the terms of such approved underwriting arrangements, and (c) if
such Holder is not then an Electing Holder, such Holder returns a completed and
signed Notice and Questionnaire to the Company in accordance with Section
3(a)(ii) hereof within a reasonable amount of time before such underwritten
offering.  The Holders participating in any underwritten offering shall be
responsible for any underwriting discounts and commissions and fees and, subject
to Section 4 hereof, expenses of their own counsel.  The Company shall pay all
expenses customarily borne by issuers in an underwritten offering, including but
not limited to filing fees, the fees and disburse­ments of its counsel and
independent public accountants and any printing expenses incurred in connection
with such underwritten offering.  Notwithstanding the foregoing or the
provisions of Section 3(n) hereof, upon receipt of a request from the Managing
Underwriter or a representative of holders of a majority of the Registrable
Securities to be included in an underwritten offering to prepare and file an
amendment or supplement to the Shelf Registration Statement and Prospectus in
connec­tion with an underwritten offering, the Company may delay the filing of
any such amend­ment or supplement for up to 90 days if the Board of Directors of
the Company shall have determined in good faith that the Company has a bona fide
business reason for such delay.

7.                                      Liquidated Damages.

(a)           Notwithstanding any postponement of effectiveness permitted by
Section 2(a) hereof, if (i) on or prior to the 90th day following the Closing
Date, a Shelf Registration Statement has not been filed with the Commission or
(ii) on or prior to the 180th day following the Closing Date, such Shelf
Registration Statement is not declared effective by the Commission (each, a
“Registration Default”), the Company shall be required to pay liquidated damages
(“Liquidated Damages”), from and including the day following such Registration
Default until such Shelf Registration Statement is either so filed or so filed
and subsequently declared effective, as applicable, at a rate per annum equal to
an additional one-quarter of one percent (0.25%) of the principal amount of
Registrable Securities, to and including the 90th day following

14

--------------------------------------------------------------------------------

 

 

such Registration Default and one-half of one percent (0.50%) thereof from and
after the 91st day following such Registration Default.

(b)           In the event that (i) the Shelf Registration Statement ceases to
be effective, (ii) the Company suspends the use of the Prospectus pursuant to
Section 2(c) or 3(j) hereof, (iii) the Holders are not authorized to use the
Prospectus pursuant to Section 3(g) hereto or (iv) the Holders are otherwise
prevented or restricted by the Company from effecting sales pursuant to the
Shelf Registration Statement (an “Effective Failure”) for more than 30 days,
whether or not consecutive, in any 90-day period, or for more than 90 days,
whether or not consecutive, during any 12-month period, then the Company shall
pay Liquidated Damages at a rate per annum equal to an additional one-half of
one percent (0.50%) of the principal amount of Registrable Securities from the
31st day of the applicable 90-day period or the 91st day of the applicable
12-month period, as the case may be, that any such Effective Failure has existed
until the earlier of (1) the time the Shelf Registration again becomes effective
or the Holders of Registrable Securities are again able to make sales under the
Shelf Registration Statement or (2) the expiration of the Effectiveness Period.

(c)           Any amounts to be paid as Liquidated Damages pursuant to
paragraphs (a) or (b) of this Section 7 shall be paid in cash semi-annually in
arrears, with the first semi-annual payment due on the first interest payment
date following the date on which the liquidated damages began to accrue (as
defined in the Indenture), as applicable, following the date of such
Registration Default or Effective Failure, as applicable.  Such Liquidated
Damages will accrue (1) in respect of the Securities at the rates set forth in
paragraphs (a) or (b) of this Section 7, as applicable, on the principal amount
of the Securities and (2) in respect of the Common Stock issued upon conversion
of the Securities, at the rates set forth in paragraphs (a) or (b) of this
Section 7, as applicable, applied to the Conversion Price (as defined in the
Indenture) at that time.

(d)           Except as provided in Section 8(b) hereof, the Liquidated Damages
as set forth in this Section 7 shall be the exclusive monetary remedy available
to the Holders of Registrable Securities for such Registration Default or
Effective Failure. In no event shall the Company be required to pay Liquidated
Damages in excess of the applicable maximum amount of one-half of one percent
(0.50%) set forth above, regardless of whether one or multiple Registration
Defaults or Effective Failures exist.

8.                                       Miscellaneous.

(a)           Other Registration Rights.  The Company may grant registration
rights that would permit any person that is a third party the right to
piggy-back on any Shelf Registration  Statement, provided that if the Managing
Underwriter of any underwritten offering conducted pursuant to Section 6 hereof
notifies the Company and the Electing Holders that the total amount of
securities which the Electing Holders and the holders of such piggy-back rights
intend to include in any Shelf Regis­tration Statement is so large as to
materially threaten the success of such offering (including the price at which
such securities can be sold), then the amount, number or kind of securities to
be offered for the account of holders of such piggy-back rights will be reduced
to the extent necessary to reduce the total amount of securities to be included
in such offering to the amount, number and kind recommended by the Man­aging
Underwriter prior

15

--------------------------------------------------------------------------------

 

 

to any reduction in the amount of Registrable Securities to be included in such
Shelf Registration Statement.

(b)           Specific Performance.  The parties hereto acknowledge that there
would be no adequate remedy at law if the Company fails to perform any of its
obligations hereunder and that the Purchasers and the Holders from time to time
may be irreparably harmed by any such failure, and accordingly agree that the
Purchasers and such Holders, in addition to any other remedy to which they may
be entitled at law or in equity and without limiting the remedies available to
the Electing Holders under Section 7 hereof, shall be entitled to compel
specific performance of the obligations of the Company under this Registration
Rights Agreement in accordance with the terms and conditions of this
Registration Rights Agreement, in any court of the United States or any State
thereof having jurisdiction.

(c)           Amendments and Waivers.  This Agreement, including this Section
8(c), may be amended, and waivers or consents to departures from the provisions
hereof may be given, only by a written instrument duly executed by the Company
and the holders of a majority in aggregate principal amount of Registrable
Securities then outstanding.  Each Holder of Registrable Securities outstanding
at the time of any such amendment, waiver or consent or thereafter shall be
bound by any amendment, waiver or consent effected pursuant to this Section
8(c), whether or not any notice, writing or marking indicating such amendment,
waiver or consent appears on the Registrable Securities or is delivered to such
Holder.

(d)           Notices.  All notices and other communications provided for or
permitted hereunder shall be given as provided in the Indenture.

(e)           Parties in Interest.  The parties to this Agreement intend that
all Holders of Registrable Securities shall be entitled to receive the benefits
of this Agreement and that any Electing Holder shall be bound by the terms and
provisions of this Agreement by reason of such election with respect to the
Registrable Securities which are included in a Shelf Registration Statement. 
All the terms and provisions of this Agreement shall be binding upon, shall
inure to the benefit of and shall be enforceable by the respective successors
and assigns of the parties hereto and any Holder from time to time of the
Registrable Securities to the aforesaid extent.  In the event that any
transferee of any Holder of Registrable Securities shall acquire Registrable
Securities, in any manner, whether by gift, bequest, purchase, operation of law
or otherwise, such transferee shall, without any further writing or action of
any kind, be entitled to receive the benefits of and, if an Electing Holder, be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement to the aforesaid extent.

(f)            Counterparts.  This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

(g)           Headings.  The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.

(h)           Governing Law.  This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.

16

--------------------------------------------------------------------------------

 

 

(i)            Severability.  In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way impaired
or affected thereby, it being intended that all of the rights and privileges of
the parties hereto shall be enforceable to the fullest extent permitted by law.

(j)            Survival.  The respective indemnities, agreements,
representations, warranties and other provisions set forth in this Agreement or
made pursuant hereto shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Electing Holder, any director, officer or partner of such Holder, any
agent or underwriter, any director, officer or partner of such agent or
underwriter, or any controlling person of any of the foregoing, and shall
survive the transfer and registration of the Registrable Securities of such
Holder.

17

--------------------------------------------------------------------------------

 

 

Please confirm that the foregoing correctly sets forth the agreement between the
Company and you.

 

Very truly yours,

 

 

 

 

priceline.com Incorporated

 

 

 

 

 

 

 

By:

/s/ Jeffery H. Boyd

 

 

 

Name: Jeffery H. Boyd

 

 

Title: Chief Executive Officer

 

Accepted as of the date hereof:

 

 

 

 

Goldman, Sachs & Co.

 

 

 

 

 By:

/s/  Goldman, Sachs & Co.

 

 

    (Goldman, Sachs & Co.)

 

 

 

 

 

On behalf of each of the Purchasers

 

 

18

--------------------------------------------------------------------------------

 

Appendix A

PRICELINE.COM INCORPORATED

INSTRUCTION TO DTC PARTICIPANTS

(Date of Mailing)

URGENT - IMMEDIATE ATTENTION REQUESTED

DEADLINE FOR RESPONSE:

The Depository Trust Company (“DTC”) has identified you as a DTC Participant
through which beneficial interests in the priceline.com Incorporated (the
“Company”) 0.50% Convertible Senior Notes due 2011 (the “2011 Notes”) and 0.75%
Convertible Senior Notes due 2013 (the “2013 Notes” and, together with the 2011
Notes, the “Securities”) are held.

The Company is in the process of registering the Securities under the Securities
Act of 1933 for resale by the beneficial owners thereof.  In order to have their
Securities included in the registration statement, beneficial owners must
complete and return the enclosed Notice of Registration Statement and Selling
Securityholder Questionnaire.

It is important that beneficial owners of the Securities receive a copy of the
enclosed materials as soon as possible as their rights to have the Securities
included in the registration statement depend upon their returning the Notice
and Questionnaire by ____________.  Please forward a copy of the enclosed
documents to each beneficial owner that holds interests in the Securities
through you.  If you require more copies of the enclosed materials or have any
questions pertaining to this matter, please contact:  priceline.com
Incorporated, General Counsel’s Office, 800 Connecticut Avenue, Norwalk, CT 
06854.

19

--------------------------------------------------------------------------------

 

PRICELINE.COM INCORPORATED

NOTICE OF REGISTRATION STATEMENT
AND
SELLING SECURITYHOLDER QUESTIONNAIRE

Priceline.com Incorporated (the “Company”) has filed with the United States
Securities and Exchange Commission (the “Commission”) a registration statement
on Form S-3 (the “Shelf Registration Statement”) for the registration and resale
pursuant to Rule 415 under the United States Securities Act of 1933, as amended
(the “Securities Act”), of the Company’s 0.50% Convertible Senior Notes due 2011
(the “2011 Notes”) and its 0.75% Convertible Senior Notes due 2013 (the “2013
Notes” and, together with the 2011 Notes, the “Notes”), and common stock
issuable upon conversion thereof, in accordance with the terms of the
Registration Rights Agreement, dated as of September 27, 2006 (the “Registration
Rights Agreement”), between the Company and the purchasers named therein (the
“Purchasers”).  A copy of the Registration Rights Agreement is attached hereto. 
All capitalized terms not otherwise defined herein shall have the meanings
ascribed thereto in the Registration Rights Agreement.

In order to have Registrable Securities included in the Shelf Registration
Statement (or a prospectus supplement or amendment thereto), this Notice of
Registration Statement and Selling Securityholder Questionnaire (“Notice and
Questionnaire”) must be completed, executed and delivered to the Company at the
address set forth herein.  Unless the Company otherwise consents, beneficial
owners of the Registrable Securities who do not complete, execute and return
this Notice and Questionnaire (i) will not be named as selling securityholders
in the Shelf Registration Statement and related Prospectus and (ii) may not sell
their Registrable Securities pursuant thereto.  Following the Company’s receipt
of a completed and signed Notice and Questionnaire, the Company will include the
Registrable Securities covered thereby in the Shelf Registration Statement,
subject to certain restrictions described in the Registration Rights Agreement.

Certain legal consequences arise from being named as a selling securityholder in
the Shelf Registration Statement and related Prospectus.  Accordingly, holders
and beneficial owners of Registrable Securities are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Shelf Registration Statement and
related Prospectus.

20

--------------------------------------------------------------------------------

 

ELECTION

The undersigned holder (the “Selling Securityholder”) of Registrable Securities
hereby elects to include in the Shelf Registration Statement the Registrable
Securities beneficially owned by it and listed below in Item (3) (unless
otherwise specified under Item 3).  The undersigned, by signing and returning
this Notice and Questionnaire, agrees to be bound with respect to such
Registrable Securities by the terms and conditions of this Notice and
Questionnaire and the Registration Rights Agreement, including, without
limitation, Section 5 of the Registration Rights Agreement, as if the
undersigned Selling Securityholder were an original party thereto.

Upon any sale of Registrable Securities pursuant to the Shelf Registration
Statement, the Selling Securityholder will be required to deliver to the Company
and the Trustee the Notice of Transfer (completed and signed) set forth in
Exhibit 1 attached to this Notice and Questionnaire.

The Selling Securityholder hereby provides the following information to the
Company and represents and warrants that such information is accurate and
complete:

 

21

--------------------------------------------------------------------------------

 

QUESTIONNAIRE

(1)          (a) Full Legal Name of Selling Securityholder:

--------------------------------------------------------------------------------

 

(b) Full Legal Name of Registered Holder (if not the same as in (a) above) of
Registrable Securities Listed in Item (3) Below:

--------------------------------------------------------------------------------

(c) Full Legal Name of DTC Participant (if applicable and if not the same as (b)
above) Through Which Registrable Securities Listed in Item (3) Below are Held:

--------------------------------------------------------------------------------

 

(2)                  Address for Notices to Selling Securityholder:

 

 

 

 

 

 

 

 

 

 

 

 

 

Telephone:

 

 

 

Fax:

 

 

 

Contact Person:

 

 

 

(3)                                  Beneficial Ownership of Registrable
Securities:

                                                Except as set forth below, the
undersigned Selling Securityholder does not beneficially own any Notes or common
stock previously issued upon conversion, repurchase or redemption of any Note.

                                                Principal amount of Notes
beneficially owned and to be included in the Shelf Registration Statement
(including any shares of common stock issuable upon conversion, repurchase or
redemption of Notes):

--------------------------------------------------------------------------------

 

Number of shares of common stock beneficially owned and issued to date upon
conversion, repurchase or redemption of Notes (if any):

 

--------------------------------------------------------------------------------

 

Number of shares of common stock (if any) issued to date upon conversion,
repurchase or redemption of Notes which are to be included in the Shelf
Registration Statement:

--------------------------------------------------------------------------------

 

(4)                                  Other shares of common stock or other
Securities of the Company owned by the Selling Securityholder:

22

--------------------------------------------------------------------------------

 

Except as set forth below in this Item (4), and under Item (3) above, the
undersigned Selling Securityholder is not the beneficial or registered owner of
any shares of common stock or any other securities of the Company.

State any exceptions here:

(5)                  Relationships with the Company:

Except as set forth below, neither the Selling Securityholder nor any of its
affiliates, officers, directors or principal equity holders (5% or more) has
held any position or office or has had any other material relationship with the
Company (or its predecessors or affiliates) during the past three years.

State any exceptions here:

(6)                                  Additional ownership information:

State the names of any natural persons who exercise sole or shared voting or
investment power over the Notes or any other securities identified in Items (3)
or (4) above that the undersigned Selling Securityholder owns, specifying
whether such powers are sole or shared (See Rule 13d-3 under the Securities
Exchange Act of 1934 for guidance in making this determination):

--------------------------------------------------------------------------------

 

State the name of the general partner, if any, of the undersigned Selling
Securityholder:

--------------------------------------------------------------------------------

 

(7)                                  Broker-dealer information:

State whether the undersigned Selling Securityholder is a registered
broker-dealer:

--------------------------------------------------------------------------------

 

If affirmative, state whether the Notes owned were received as compensation for
investment banking services or were purchased as investment securities:

--------------------------------------------------------------------------------

 

(8)                                  Broker-dealer affiliate information:

State whether the undersigned Selling Securityholder is an affiliate of a
registered brokerdealer:

If affirmative, state whether

--------------------------------------------------------------------------------

23

--------------------------------------------------------------------------------

 

(a)                                  the Notes were purchased in the ordinary
course of business:

--------------------------------------------------------------------------------

 

and

(b)                                 at the time of the purchase of the Notes
(including the shares of common stock issuable upon conversion of the Notes) to
be resold, the undersigned Selling Securityholder had any agreements or
understandings, directly or indirectly, with any person to distribute the Notes
(including the shares of common stock issuable upon conversion of the Notes):

--------------------------------------------------------------------------------

 

(9)                                  Short sales and plan of distribution:

The Commission has published the following guidance in connection with short
sales (Telephone Interp. A. 65 (July 1997)):

“An issuer filed a Form S-3 registration statement for a secondary offering of
common stock which is not yet effective.  One of the selling shareholders wanted
to do a short sale of common stock “against the box” and cover the short sale
with registered shares after the effective date.  The issuer was advised that
the short sale could not be made before the registration statement becomes
effective, because the shares underlying the short sale are deemed to be sold at
the time such sale is made.  There would, therefore, be a violation of Section 5
if the shares were effectively sold prior to the effective date.”

The undersigned Selling Securityholder represents and agrees that the
distribution of Notes and shares of common stock issuable upon conversion of the
Notes pursuant to the Shelf Registration Statement will conform with this
interpretative guidance.

State whether the undersigned Selling Securityholder has taken short positions
in respect of shares of the Company’s common stock after September [  ], 2006
and prior to _________, _____, and if so, state the date(s) on which such short
positions were taken and for each date, the number of shares of common stock
made subject to such short positions.

--------------------------------------------------------------------------------

The undersigned Selling Securityholder represents and agrees that short
positions taken prior to the effective date of the Shelf Registration Statement
will only be covered with shares of the Company’s common stock purchased in the
open market and will not be covered with shares of the Company’s common stock
obtained upon conversion of the Notes.

(10)            Plan of Distribution:

Except as set forth below, the undersigned Selling Securityholder intends to
distribute the Registrable Securities listed above in Item (3) only as follows
(if at all):  Such Registrable Securities may be sold from time to time directly
by the undersigned

24

--------------------------------------------------------------------------------

 Selling Securityholder or, alternatively, through underwriters, broker-dealers
or agents.  Such Registrable Securities may be sold in one or more transactions
at fixed prices, at prevailing market prices at the time of sale, at varying
prices determined at the time of sale, or at negotiated prices.  Such sales may
be effected in transactions (which may involve crosses or block transactions)
(i) on any national securities exchanges or U.S. inter-dealer quotation system
of a registered national securities association on which the Registrable
Securities may be listed or quoted at the time of sale, (ii) in the
over-the-counter market, (iii) in transactions otherwise than on such exchanges
or services or in the over-the-counter market, or (iv) through the writing of
options.  In connection with sales of the Registrable Securities or otherwise,
the Selling Securityholder may enter into hedging transactions with
broker-dealers, which may in turn engage in short sales of the Registrable
Securities in the course of hedging the positions they assume.  The Selling
Securityholders may also sell Registrable Securities short and deliver
Registrable Securities to close out such short positions, or loan or pledge
Registrable Securities to broker-dealers that in turn may sell such securities.

State any exceptions here:

Note:  In no event may such method(s) of distribution take the form of an
underwritten offering of the Registrable Securities without the prior agreement
of the Company.

The Company shall promptly furnish to the Selling Securityholder copies of the
Shelf Registration Statement, including each amendment thereto, the Prospectus
and any amendments or supplements to the Prospectus, in each case promptly after
filing with the Commission.  The Selling Securityholder agrees that the
provisions of this paragraph shall apply in lieu of Section 3(b) of the
Registration Rights Agreement.

By signing below, the Selling Securityholder acknowledges that it understands
its obligation to comply, and agrees that it will comply, with the prospectus
delivery and other provisions of the Securities Act and the Exchange Act and the
respective rules and regulations thereunder, particularly Regulation M.

In the event that the Selling Securityholder transfers all or any portion of the
Registrable Securities listed in Item (3) above after the date on which such
information is provided to the Company, the Selling Securityholder agrees to
notify the transferee(s) at the time of the transfer of its rights and
obligations under this Notice and Questionnaire and the Registration Rights
Agreement.

By signing below, the Selling Securityholder consents to the disclosure of the
information contained herein in its answers to Items (1) through (10) above and
the inclusion of such information in the Shelf Registration Statement and
related Prospectus.  The Selling Securityholder understands that such
information will be relied upon by the Company in connection with the
preparation of the Shelf Registration Statement and related Prospectus.

In accordance with the Selling Securityholder’s obligation under the
Registration Rights Agreement to provide such information as may be required by
law for inclusion in the Shelf Registration Statement, the Selling
Securityholder agrees to promptly notify the Company of any inaccuracies or
changes in the information provided herein which may occur subsequent to the
date hereof at any time while the Shelf Registration Statement remains in
effect.  All

25

--------------------------------------------------------------------------------

notices hereunder and pursuant to the Registration Rights Agreement shall be
made in writing, by hand-delivery, first-class mail, or air courier guaranteeing
overnight delivery as follows:

To the Company:

 

priceline.com Incorporated

 

 

800 Connecticut Avenue

 

 

Norwalk, Connecticut 06854

 

 

Attention: General Counsel

 

 

Fax: (203) 299-8915

 

 

 

Once this Notice and Questionnaire is executed by the Selling Securityholder and
received by the Company, the terms of this Notice and Questionnaire, and the
representations and warranties contained herein, shall be binding on, shall
inure to the benefit of and shall be enforceable by the respective successors,
heirs, personal representatives, and assigns of the Company and the Selling
Securityholder with respect to the Registrable Securities beneficially owned by
such Selling Securityholder and listed in Item (3) above.  This Agreement shall
be governed in all respects by the laws of the State of New York.

 

26

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.

Dated:

 

 

 

 

 

 

 

 

Selling Securityholder

 

(Print/type full legal name of beneficial owner of Registrable Securities)

 

 

 

 

 

 

 

By:

 

 

Name:

 

Title:

 

 

 

 

 

 

PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO THE COMPANY
AT:

priceline.com Incorporated
800 Connecticut Avenue
Norwalk, Connecticut 06854
Attention: General Counsel
Fax: (203) 299-8915

WITH A COPY TO:

Diane Heath, Esq.
Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004
Fax: (212) 558-3260

 

27

--------------------------------------------------------------------------------

 

Exhibit 1
to Appendix A

NOTICE TO TRANSFER PURSUANT TO REGISTRATION STATEMENT

American Stock Transfer & Trust Company
59 Maiden Lane
New York, New York 10038
Attention: Herbert Lemmer

priceline.com Incorporated
800 Connecticut Avenue
Norwalk, Connecticut 06854
Attention: General Counsel

Re:             0.50% Convertible Senior Notes due 2011 (the “2011 Notes”)
0.75% Convertible Senior Notes due 2013 (the “2013 Notes” and, together with the
2011 Notes, the “Securities”) (the “Notes”)
    CUSIP # 741503AF3
                   741503AG1

Ladies and Gentlemen:

Please be advised that _____________________ has transferred $___________
aggregate principal amount of the above-referenced Notes or shares of the
Company’s common stock, issued on conversion, repurchase or redemption of Notes,
pursuant to the Registration Statement on Form S-3 (File No. 333-____) filed by
the Company.

We hereby certify that the prospectus delivery requirements, if any, of the
Securities Act of 1933, as amended, have been satisfied with respect to the
transfer described above and that the above-named beneficial owner of the Notes
or common stock is named as a selling securityholder in the Prospectus dated
_______________, or in amendments or supplements thereto, and that the aggregate
principal amount of the Notes or number of shares of common stock transferred
are [a portion of] the Notes or common stock listed in such Prospectus as
amended or supplemented opposite such owner’s name.

Dated:

 

 

Very truly yours,

 

 

 

 

 

 

 

 

(Name)

 

 

 

 

By:

 

 

 

(Authorized Signature)

p

28

--------------------------------------------------------------------------------