DEF 14A of Royal Caribbean Cruises LTD
Filed Apr 18, 2025 · FY20240000884887-25-000087
Election of Directors
Election of Directors
The board recommends a
The board recommends a vote “FOR” each nominee.
Director Nominees*
Director Nominees*
Director Nominees*
| Name and Primary Occupation | | | | Committee Membership | | | | | | | Age | Director Since | | | | | | | | | | AC | TCC | NGC | SESH | | | John F. Brock INDEPENDENT Former Chairman & CEO, Coca-Cola European Partners | 76 | 2014 | | • | • | | | | Richard D. Fain INDEPENDENT Chairman, Former CEO Royal Caribbean Group | 77 | 1981 | | | | | | | Stephen R. Howe, Jr. INDEPENDENT Former U.S. Chairman & Managing Partner, Ernst & Young | 63 | 2018 | • | | • | | | | Michael O. Leavitt INDEPENDENT Co-Chairman, Health Management Associates and Chairman, Leavitt Equity Partners | 74 | 2022 | | | | • | | | Jason T. Liberty President and CEO, Royal Caribbean Group | 49 | 2021 | | | | | | | Amy McPherson INDEPENDENT Former President & Managing Director, Europe, Marriott | 63 | 2020 | | • | | | | | Maritza G. Montiel INDEPENDENT Former Deputy CEO & Vice Chairman, Deloitte | 73 | 2015 | • | • | | | | | Ann S. Moore INDEPENDENT Former Chairman & CEO, Time | 74 | 2012 | | • | | | | | Eyal M. Ofer INDEPENDENT Chairman, Ofer Global and Zodiac Group | 74 | 1995 | | | • | • | | | Vagn O. Sørensen INDEPENDENT Former President & CEO, Austrian Airlines Group | 65 | 2011 | • | • | | | | | Donald Thompson INDEPENDENT Former President & CEO, McDonald’s Corporation | 62 | 2015 | | • | | • | | | Arne Alexander Wilhelmsen INDEPENDENT Chairman, AWILHELMSEN AS | 59 | 2003 | | | • | • | | | Rebecca Yeung INDEPENDENT Former Corporate Vice President at FedEx Corporation | 53 | 2023 | • | | | |
Director Nominees*
AC Audit Committee NGC Nominating and Corporate Governance Committee SESH Safety, Environment, Sustainability and Health Committee TCC Talent and Compensation Committee Chair Member e*Mr. William Kimsey is not standing for re-election to the Board and his term will expire effective as of the date of the Annual Meeting.
Director Nominees*
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Director Nominees*
| PROXY SUMMARY | TABLE OF CONTENTS |
Election of Directors
Election of Directors Our Board currently has 14 members. Mr. Kimsey will not stand for re-election and his term on the Board will expire as of the date of the Annual Meeting. Our Bylaws provide that the Board of Directors shall consist of between ten and fifteen directors, Concurrently with the Annual Meeting, the Board has set the current size of the Board to 13 directors. On the recommendation of the Nominating and Corporate Governance Committee, the Board has nominated each of our thirteen remaining directors for re-election to hold office until the next annual meeting of shareholders and until their successors are duly elected and qualified. Each candidate has consented to being named in this proxy statement and serving as a director, if elected. However, if any nominee is not able to serve, the Board can either nominate a different person or reduce the size of the Board. If the Board nominates another individual, the persons named as proxies may vote for that nominee.
The Board unanimously recommends that shareholders vote “FOR” the election
The Board unanimously recommends that shareholders vote “FOR” the election of each of the nominees for director named below.
Our Director Nominees
Our Director Nominees Our Board is made up of a diverse group of leaders with substantial experience in their respective fields. Our director nominees hold, and have held, senior positions as leaders of various large and complex businesses and organizations and in government, demonstrating their ability to develop and execute significant policy and operational objectives at the highest levels. Our nominees include current and former chief executive officers, chief financial officers, chief operating officers and other members of senior management of large, global businesses. Through these roles, our nominees have developed expertise in, among other things, core business strategy, operations, finance, human capital management and leadership development, compliance, controls and risk management, as well as the skills to respond to rapidly evolving business environments and to foster innovation and business transformation. Additionally, our nominees’ experience serving in government and on other boards brings valuable knowledge and expertise, including in the areas of public policy, governance, succession planning, financial reporting and regulatory compliance. Our Board believes that the combination of the various skills, qualifications and experiences of the director nominees contributes to an effective and well-functioning Board and that, individually and as a whole, the director nominees possess the necessary qualifications to provide effective oversight and strategic guidance.
Our Director Nominees
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Our Director Nominees
| TABLE OF CONTENTS | OUR DIRECTOR NOMINEES |
Our Director Nominees
We have included below detailed biographical information for each director nominee, including career highlights, other public directorships and select professional and community contributions, along with the top qualifications, experience, skills and expertise we believe each director brings to our Board. Our Board considered all of these attributes when deciding to nominate these individuals to the Board. Richard D. Fain BACKGROUND: Mr. Brock retired as Chief Executive Officer of Coca Cola European Partners in December 2016, having served in that role since the formation of that company in May 2016. Prior to that, Mr. Brock served as Chairman and Chief Executive Officer of Coca Cola Enterprises Inc. since April 2008 and as Chief Executive Officer since April 2006. From February 2003 until December 2005, Mr. Brock was Chief Executive Officer of InBev, S.A., a global brewer, and from March 1999 until December 2002, he was Chief Operating Officer of Cadbury Schweppes plc, an international beverage and confectionery company. From April 2007 to December 2007, Mr. Brock served as a director of Dow Jones & Company, Inc., a publisher and provider of global business and financial news. From 2004 to 2006, he served as a director of the Campbell Soup Company, a global manufacturer and marketer of branded convenience food products. From 2003 to 2005, he served as a director of Interbrew / Inbrew, a beer brewing company. He also served as a director of Reed Elsevier, a publisher, from 1997 to 2003. Mr. Brock is a Trustee of the Georgia Tech Foundation and a member of the Smithsonian National Board. Mr. Brock is a member of the Board of Directors of ApJet, LLC and thegameHERs, LLC and is Managing Director of Brock Holdings, LLC. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Brock brings senior leadership and strategic and global expertise from his most recent position as Chairman and Chief Executive Officer of one of the world’s largest independent Coca-Cola bottlers. Prior to his retirement, Mr. Brock demonstrated effective and efficient leadership of a complex, publicly traded company competing in the highly competitive international beverage industry. Age: 76 Director Since: February 2014 Committees: •Nominating and Corporate Governance Committee (Chair) •Talent and Compensation Committee
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Other Public Company Boards: •None
Chairman of the Board
Chairman of the Board Age: 77 Director Since: January 1981 Committees: •None
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Other Public Company Boards: •None BACKGROUND: Mr. Fain served as our Chief Executive Officer from 1988 through January 2022. He has been a director of the Company since 1981 and our Chairman since 1988. Mr. Fain is a recognized industry leader, having participated in shipping for over 50 years and having held a number of prominent industry positions, such as Chairman of the Cruise Lines International Association (CLIA), the largest cruise industry trade association. He currently serves on the University of Miami Board of Trustees and the UHealth Board of Directors. He is former chairman of the University of Miami Board of Trustees, the Miami Business Forum,the Greater Miami Convention and Visitors Bureau, the UHealth Board of Directors, and the United Way of Miami Dade. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Fain’s breadth of experiences, tenure and leadership provide incomparable insights into the history, operations, and strategic vision of the Company as well as the evolution and direction of the cruise industry as a whole. Having served as Chairman & CEO for over 33 years, Mr. Fain helped grow the Company from a one brand Caribbean centric operation with berthing capacity of approximately 5,000 to the second largest cruise company in the world with a portfolio of global and regional brands that operate around the globe. John F. Brock
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| OUR DIRECTOR NOMINEES | TABLE OF CONTENTS |
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Michael O. Leavitt Age: 74 Director Since: February 2022 Committees: •Safety, Environment, Sustainability and Health Committee (Chair)
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Other Public Company Boards: •None BACKGROUND: Gov. Leavitt is the Co-Chairman of Health Management Associates, a health care consulting firm, and Chairman of Leavitt Equity Partners, a private equity fund. From 2009 to 2021, he served as the Chairman of Leavitt Partners, LLC, a health care consulting firm. He also previously served as the United States Secretary of Health and Human Services from 2005 to 2009, the Administrator of the Environmental Protection Agency from 2003 to 2009 and the Governor of the State of Utah from 1993 to 2003. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Gov. Leavitt brings to our Board extensive management and leadership experience, including service as the Governor of Utah, a large state with a diverse body of constituents, and service in positions with the U.S. government, where he oversaw and advised on issues of national concern such as healthcare and environmental protection. These experiences were instrumental to his role as Co- Chair of the Healthy Sail Panel in developing recommendations for cruise lines to advance their public health response to COVID-19 and contributes to the Board’s oversight of these issues. Further, his experience at the EPA provides the Board with valuable insight in relation to the Company’s various environmental, social and governance initiatives. BACKGROUND: Mr. Howe served as U.S. Chairman and Managing Partner and Americas Area Managing Partner of Ernst & Young (“EY”) and was a member of EY’s Global Executive Board from 2006 until his retirement in 2018. In these roles, Mr. Howe directed strategy and operations for EY’s businesses of over 75,000 people delivering professional services across all industry sectors. While leading EY, Mr. Howe also was responsible for the firm’s board governance and regulatory relationships and was executive sponsor for the firm’s focus on diversity and inclusiveness. He was with EY for 37 years. Mr. Howe is also a member of the Board of Trustees of Carnegie Hall, the Board of the Peterson Institute for International Economics and the Board of Trustees (Chairman) of the Liberty Science Center. Mr. Howe was previously a member of multiple boards including Colgate University, the Center for Audit Quality and the Financial Accounting Foundation. He currently serves as a member of the Board of Directors of Lazard Inc. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Howe brings to the Board considerable financial and leadership experience through his service as U.S. Chairman and Managing Partner and Americas Managing Partner of EY. He provides the board with meaningful insight gained from his strategic and operational experience and from his extensive board experience both at EY and in interactions with EY clients. Age: 63 Director Since: December 2018 Committees: •Audit Committee (Chair) •Nominating and Corporate Governance Committee
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Other Public Company Boards: •Lazard, Inc. (New York Stock Exchange) Stephen R. Howe, Jr.
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BACKGROUND: Ms. McPherson served in various positions at Marriott International, Inc. for over 30 years. Most recently, from 2009 through 2019, she served as President & Managing Director, Europe. Under her leadership, Marriott launched five new brands in Europe and completed the successful integration of Starwood Hotels in Europe. Since 2017, Ms. McPherson has served as a non-executive member of the board of directors of PVH Corporation and is a member of its Audit Committee and Chair of its Nominating & Governance Committee. In December 2023, Ms. McPherson was appointed as non- executive member of the board of directors for Merlin Entertainments Ltd and is a member of the Remuneration and Health, Safety & Security Committees. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Ms. McPherson brings to the board considerable experience in overseeing business operations and development in Europe, having overseen multiple brands of hotels for Marriott. She has overseen acquisitions and strategic partnerships and implemented and executed strategies on both a regional and global basis. In addition, Ms. McPherson has experience managing Marriott’s global and field sales, marketing, loyalty program, revenue management, e-commerce, worldwide reservation sales and customer care, and sales channel strategy and analysis. Age: 63 Director Since: December 2020 Committees: •Talent and Compensation Committee
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Other Public Company Boards: •PVH Corporation (New York Stock Exchange) Amy McPherson BACKGROUND: Mr. Liberty has served as President and Chief Executive Officer since January 2022. Mr. Liberty has held several roles since joining the Company in 2005, including most recently as Executive Vice President and Chief Financial Officer since 2017 and, prior to that, as Senior Vice President and Chief Financial Officer since 2013. Before his role as Chief Financial Officer, Mr. Liberty served as Senior Vice President, Strategy and Finance from 2012 through 2013; as Vice President of Corporate and Revenue Planning from 2010 through 2012; and as Vice President of Corporate and Strategic Planning from 2008 to 2010. Before joining Royal Caribbean Group, Mr. Liberty was a Senior Manager at the international public accounting firm of KPMG LLP. Mr. Liberty currently serves on the Board of Directors of WNS Holdings. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Liberty has years of broad-based, diverse senior management experience at the Company, including service as Executive Vice President and Chief Financial Officer, where he was responsible for finance, strategy, shared service operations, legal, and technology matters, among other areas. His experience and industry knowledge make him a valuable member of our Board. Age: 49 Director Since: November 2021 Committees: •None
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Other Public Company Boards: •WNS (Holdings) Limited (New York Stock Exchange) Jason T. Liberty
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BACKGROUND: Ms. Montiel served as Deputy Chief Executive Officer and Vice Chairman of Deloitte LLP from 2011 through her retirement in May 2014. Prior to these positions, she held numerous senior management roles at Deloitte, including Managing Partner (Leadership Development and Succession, Deloitte University) from 2009 to 2011, and Regional Managing Partner from 2001 to 2009. During Ms. Montiel’s tenure at Deloitte, she was the Advisory Partner for many public company registrants in addition to overseeing Deloitte’s risk function. Ms. Montiel is a board member of McCormick & Company, where she chairs the audit committee. She also served as a member of the Board of Directors of Comcast Corporation from June 2018 to June 2024. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Leveraging her more than 35 years of advising companies (including providing attestation services for public companies) across a wide cross section of industries, Ms. Montiel brings to the Board significant financial and advisory experience. The Board also benefits from her deep and broad working knowledge of the strategic and governance challenges faced by today’s large organizations and her experience overseeing risk and compliance in her role as Deputy CEO of Deloitte. Age: 73 Director Since: December 2015 Committees: •Audit Committee •Talent and Compensation Committee
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Other Public Company Boards: •McCormick & Company (New York Stock Exchange) Maritza G. Montiel BACKGROUND: Ms. Moore served as Chair and Chief Executive Officer of Time Inc. from July 2002 to September 2010 and served as Chair through December 2010. Prior to that, Ms. Moore was Executive Vice President of Time Inc., where she had executive responsibilities for a portfolio of magazines including Time, People, InStyle, Teen People, People en Español and Real Simple. Ms. Moore joined Time Inc. in 1978 in Corporate Finance. Since then, she held consumer marketing positions at Sports Illustrated, Fortune, Money and Discover, moving to general management of Sports Illustrated in 1983 and to publisher of People in 1991. From 1993 to May 2014, Ms. Moore served on the Board of Directors of Avon Products Inc. She was also a director of the Wallace Foundation from 2004 through June 2016. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Ms. Moore’s extensive experience in consumer driven publishing and media brings to the Board recognized management and entrepreneurial capabilities. As the leader of one of the largest magazine companies in the United States, Ms. Moore successfully expanded the footprint of many of the company’s flagship brands and oversaw her company’s transition to digital platforms. Age: 74 Director Since: May 2012 Committees: •Talent and Compensation Committee
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Other Public Company Boards: •None Ann S. Moore
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BACKGROUND: Eyal Ofer has served as a director of the Company since May 1995. He is Chairman of his multi- generational family group, Ofer Global, leading a private portfolio of international businesses principally focused on maritime shipping, real estate, energy, technology, banking and large public investments. These include its shipping division, Zodiac Group, an international shipping enterprise operating one of the world's largest private diversified fleets, and its real estate arm, Global Holdings Group, a property holding conglomerate with over 12 million square feet of real estate, specializing in large-scale office buildings, hotels and luxury residential developments, as well as other investment and development assets. In 2017, Eyal Ofer launched O.G. Venture Partners, a single LP Venture Capital fund which has in excess of $1bn AUM. He also leads the group’s O.G. Energy division, which has interests including renewable energy projects focused on wind, solar and forestry, and is a global leader in the provision of FSO and FPSO units through Omni Offshore Terminals. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Ofer brings to the Board over 35 years of significant leadership in the international maritime industry, including 30 years of service on our Board of Directors. Mr. Ofer also provides considerable expertise in both real estate and finance matters, having played a leading role throughout his career in both expanding and diversifying his family’s shipping enterprise into sectors including real estate, cruise lines, hotels, banking and technology. Age: 74 Director Since: May 1995 Committees: •Safety, Environment, Sustainability and Health Committee •Nominating and Corporate Governance Committee
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Other Public Company Boards: •None Eyal M. Ofer BACKGROUND: Mr. Sørensen brings to the Board over 20 years of experience in the aviation industry, having served as the President and Chief Executive Officer of Austrian Airlines Group from 2001 through 2006. Prior to that, he served in a variety of roles with Scandinavian Airlines Systems, including as Executive Vice President and Deputy CEO. He currently serves as a board member and chairman for a number of corporations throughout Europe and Canada, including Air Canada, Pantheon Infrastructure Trust, Parques Reunidos SA, CNH Industrial and Vakantie Discounter. Mr. Sørensen also previously served on the board of Scandic Hotels AB, SSP Group and DFDS. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Sørensen’s breadth of experience in the aviation industry and the insurance industry brings useful insight to the Board, especially with respect to matters impacting the travel industry and risk management. He also provides significant experience within the shipping industry gained through his prior service as Deputy Chairman of DFDS A/S, one of the largest short seas operators in Europe. Through his service on a number of other boards in Europe and Canada, Mr. Sørensen also provides the Board with diverse perspectives. Age: 65 Director Since: July 2011 Committees: •Audit Committee •Talent and Compensation Committee (Chair)
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Other Public Company Boards: •Air Canada (Toronto Stock Exchange) •CNH Industrial (New York Stock Exchange and Milan Stock Exchange) •Pantheon Infrastructure Plc (London Stock Exchange) Vagn O. Sørensen
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| OUR DIRECTOR NOMINEES | TABLE OF CONTENTS |
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BACKGROUND: Mr. Thompson currently serves as Chief Executive Officer of Cleveland Avenue, LLC, a food, beverage and technology investment company, which he founded in 2015. From 2012 to March 2015, Mr. Thompson served as President and Chief Executive Officer of McDonald’s Corporation. Previously, Mr. Thompson served as President and Chief Operating Officer of McDonald’s Corporation from 2010 to 2012 and President of McDonald’s USA from 2006 to 2010. Prior to joining McDonald’s, Mr. Thompson served six years as an Electrical Engineer for the Northrop Corporation, where he specialized in power supply design and manufacturing for high technology radar systems. Mr. Thompson served as director of McDonald’s Corporation from 2011 to March 2015, a director of Exelon Corporation from 2007 to 2013 and a director of Beyond Meat, Inc. from 2015 to May 2021. He also served as an Advisory Board member of DocuSign, Inc. from 2015 to 2018 and a Trustee of Purdue University from 2009 to 2022. Mr. Thompson has served as a director of Northern Trust Corporation since March 2015 and has been a member of the board of directors of Footprint International HoldCo Inc. since April 2021, and has served as chairman of the board since June 2021. He also serves on numerous civic and philanthropic boards. He is a member of the Commercial and Economic Clubs of Chicago, World Business Chicago and the Arthur M. Brazier Foundation. He serves as a director for Northwestern Memorial HealthCare and a Trustee on the board of the Cleveland Avenue Foundation for Education. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Mr. Thompson brings to the Board significant strategic leadership and collaboration skills as well as valuable global business perspective. His 25-year career at McDonald’s, the world’s leading global foodservice retailer, culminated in him leading the company from 2012 through 2015. In his role as President & CEO of McDonald’s, Mr. Thompson directed strategy and operations for over 30,000 restaurants in over 100 countries, working closely with thousands of independent owner/operators, corporate staff and restaurant employees around the world. Age: 62 Director Since: May 2015 Committees: •Safety, Environment, Sustainability and Health Committee •Talent and Compensation Committee
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Other Public Company Boards: •Northern Trust Corporation (Nasdaq Global Select Market) Donald Thompson BACKGROUND: Mr. Wilhelmsen is Chairman of the board of directors of AWAS Holding AS, the holding company for the Awilhelmsen group, one of Norway’s largest family-owned investments companies. Mr. Wilhelmsen has been the Chairman of the board of directors since 2008 and was prior to this the Chief Executive Officer of the Awilhelmsen group from 2005 to 2008. From 1995 to 2005 Mr. Wilhelmsen held a variety of positions withing the Awilhelmsen Group. From 2011 until its merger into the Awilhelmsen group in 2023, Mr. Wilhelmsen also served as Chairman of the Board of Aweco Invest AS, a family office with financial investments, philanthropy and social impact activities. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: As the leader of an investment company with varied interests across a number of business segments, including cruise, software development for health services, insurance, real estate, retail, offshore wind, shipping and offshore oil service, Mr. Wilhelmsen brings a diverse knowledge base and strategic insight to the Board. As the representative of one of the Company’s largest shareholders and one of the Company’s original founders, Mr. Wilhelmsen also provides a valuable historical perspective to the Board. Age: 59 Director Since: April 2003 Committees: •Safety, Environment, Sustainability and Health Committee •Nominating and Corporate Governance Committee
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Other Public Company Boards: •None Arne Alexander Wilhelmsen
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| TABLE OF CONTENTS | OUR DIRECTOR NOMINEES |
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BACKGROUND: Ms. Yeung served as Corporate Vice President, Operations Science and Advanced Technology at FedEx Corporation, a global logistics company with a broad portfolio of transportation, e-commerce and business services until December 2024. In her role, she was responsible for driving critical aspects of FedEx’s innovation and transformation strategy including scaling up robotics and automation technology, autonomous vehicles, decision science, and electromobility. Ms. Yeung joined FedEx in 1998 and served in various marketing, innovation, and technology roles since then. Prior to her most recent role, she was Vice President – Advanced Technology & Innovation at FedEx Corporation from 2015 to 2021. She also previously served as a Board of Director for the Mid-South Food Bank between 2013 and 2022. SPECIFIC QUALIFICATIONS, ATTRIBUTES, SKILLS AND EXPERIENCE: Ms. Yeung brings to the Board nearly 30 years of global experience in strategy, innovation, technology, global operations, supply chain, digitization, and sustainability. She is a well recognized expert in both advanced technology/AI and logistics operations space, frequently speaking at high profile industry forums including Fortune, CES, Reuters, TechCrunch, MIT, and World50. In 2024, Rebecca was recognized by Reuters Events as one of the Top 20 Women in Enterprise AI. Age: 53 Director Since: March 2023 Committees: •Audit Committee
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Other Public Company Boards: •Columbus McKinnon (NASDAQ) Rebecca Yeung
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| OUR BOARD'S COMPOSITION | TABLE OF CONTENTS |
Long Term Growth
Long Term Growth 3 new ships launched Strong pipeline of 8 new ocean ships to be delivered 2025-2028 Exclusive Collection of Land-Based Experiences 4 new Land-Based Experiences Opening 2025-2027 Removing friction, enabling a guest-centric vacation experience Leveraging data and AI to deepen relationships with customers Cross-brand loyalty across brands
to both short-and long-term
to both short-and long-term
Implementation
Implementation Total direct compensation levels should be competitive to attract, motivate and retain the highest quality executives. Our Talent and Compensation Committee seeks to establish target total direct compensation (salary, short-term incentive and long-term incentive) at appropriate levels relative to our Market Comparison Group, providing our executives the opportunity to be competitively rewarded for our financial and operational performance. Total direct compensation opportunity (i.e., maximum achievable compensation) should increase with position and responsibility. Performance-based and “at-risk” incentive compensation should constitute a substantial portion of total compensation. We seek to foster a pay-for-performance culture, with a significant portion of total direct compensation being performance-based and/or “at risk.” Executives with greater responsibilities and the ability to directly impact our strategic and operational goals and long-term results should bear a greater proportion of the risk if these goals and results are not achieved. Therefore, the more senior the executive, the greater the percentage of total compensation in the form of performance-based and/or “at risk” compensation. Long-term incentive compensation should align executives’ interests with our shareholders’ interests to further the creation of long-term shareholder value. We focus on ensuring that executive compensation includes a high portion of long-term performance-based equity compensation. Awards of equity-based compensation encourage executives to focus on our long-term growth and prospects and incentivize executives to manage our company from the perspective of owners with a meaningful stake and to encourage them to remain with us for long and productive careers. Our stock ownership guidelines further enhance the incentive to create long-term shareholder value. Equity-based compensation also subjects our executives to market risk, a risk also borne by our shareholders.
Snapshot of 2024 Executive Compensation Actions
Snapshot of 2024 Executive Compensation Actions Executive Bonus Plan •Continued the use of the same financial and operational measures in our annual incentive program. •Maintained same weighting of financial performance measures so that Adjusted EPS and Adjusted Brand Operating Income account for 65% of company-wide and brand performance metrics, respectively, to reflect the continued focus on profitable growth. •Continued the use of corporate responsibility metrics as part of our corporate and brand KPIs. These metrics take into account performance with respect to our goals on employee engagement, cyber maturity rating from the National Institute of Standards and Technology (NIST), pay equity, and a carbon intensity reduction goal. Time-Based Restricted Stock Units •No changes from 2023; These awards vest in equal annual installments over a three-year period commencing on the first anniversary date of the grant. Performance-Based Restricted Shares •For 2024, the Talent and Compensation Committee decided to return to the historical financial metrics of Adjusted EPS and ROIC. The Committee removed Adjusted EBITDA per APCD, which was a metric specific to the awards granted in 2023 to incentivize achievement of our financial goals under the Trifecta program that was announced to investors in November 2022. •Continued the measurement period for PSU Awards to reflect one-year, two-year and three-year performance segments, with 50% of total payout tied to performance for the third segment. Performance targets for all three years are established at the time of grant. •Returned to utilizing a maximum payout of 200% without any additional payout opportunity for outperformance in the last year of the performance cycle. It is our long-standing practice to actively engage with our shareholders throughout the year. We believe it is important to directly engage with our shareholders as a means of soliciting their views on matters such as corporate governance, executive compensation and environmental and social initiatives, among other important topics. In 2024, management directly engaged with shareholders representing approximately 40% of our outstanding shares. During this outreach, shareholders did not express any concerns about our executive compensation program. In addition to ongoing conversations and formal annual engagement, we also consider the voting outcome of our say-on-pay advisory proposals each year. At the 2024 Annual Meeting of Shareholders, 97% of the votes cast by shareholders supported the advisory vote on executive compensation. We believe the 2024 voting results and input from our shareholder engagement affirmed our shareholders' support of our overall executive compensation program. In light of the shareholder support, the Talent and Compensation Committee did not make any significant changes to its approach to executive compensation. The Talent and Compensation Committee values the opinions of our shareholders and will continue to consider shareholder feedback and the outcomes of future say-on-pay advisory votes when designing compensation programs and making compensation decisions for our NEOs. We currently hold a say-on-pay advisory vote every year.
COMPENSATION ELEMENTS
| Equity Compensation | | Cash Compensation | | | Variable | | | Fixed | | Time-Based Restricted Stock Units | Performance-Based Restricted Shares | Performance-Based Annual Incentive | Base Salary | | Pay Elements (rounded) | | | | | Objective | | | | | •Multi-year vesting requirements align our executives’ interests with our shareholders and incentivize retention of our executive talent | •Structured to align with shareholder interests, reward the achievement of long-term goals and promote stability and corporate loyalty among the executives | •To focus executives on annual financial and operational performance •To reward executives for performance relative to our short-term goals and initiatives | •Provide a base level of income in line with expertise, experience, tenure, performance, potential and scope of responsibility | | Key Features | | | | | •Vest in equal annual installments over three-year period commencing on the first anniversary date of the grant •Increases, when appropriate, are provided based on market movements, scope of responsibilities, and merit | •Earned only if specified financial performance measures are met •Measures performance over three years, with annual performance segments that have 25%, 25% and 50% weighting •PSU Awards granted in 2024 will be earned based on Adjusted EPS, ROIC, and carbon intensity reduction •PSU Awards granted in 2024 for the period ending December 2026 have potential payouts that range from 0% to 200% of target | •Earned based on company- wide and/or brand-specific (based on area of responsibility) financial and operational objective metrics and individual performance against previously established strategic goals, including, but not limited to, Adjusted EPS (corporate), adjusted brand operating income, if applicable, and a Corporate Responsibility composite •For our President and CEO, payout is entirely based on corporate performance •For other NEOs, 2/3rd is determined by corporate and, if applicable, brand performance, 1/3rd based on individual performance •Payouts range from 0% to 200% based on achievement of results during the year | •Set annually based on market competitiveness and in-line with performance and contributions to the achievement of Company goals •Increases, when appropriate, are provided based on market movements, scope of responsibilities, and merit |
PERFORMANCE-BASED ANNUAL INCENTIVE
PERFORMANCE-BASED ANNUAL INCENTIVE Why we pay annual performance-based compensation. We believe that annual incentive programs focus executives on annual financial and operational performance enabling them to better manage the cyclical nature of our business and to reward executives for performance relative to our annual goals and initiatives. We pay our annual performance-based compensation pursuant to our Executive Short-Term Bonus Plan (the “Executive Bonus Plan”). The Executive Bonus Plan is designed to reward our executives for the achievement of RCG’s annual financial and/or strategic goals and to recognize individual contributions. For 2024, the Executive Bonus Plan represented approximately 16% of the CEO’s total target direct compensation and 22% for the other NEOs. How we determine annual target bonus. Each year, the Talent and Compensation Committee considers the responsibilities of each executive and the competitiveness of our target bonus opportunity compared to our Market Comparison Group. The Talent and Compensation Committee then sets the annual Executive Bonus Plan target for each NEO as a percentage of base salary. For 2024, the Talent and Compensation Committee approved an increase to the Executive Bonus Plan target for Ms. Hodges Bethge in recognition of her expanded responsibilities after her promotion. There were no changes to the target percentages for the other NEOs.
PERFORMANCE-BASED ANNUAL INCENTIVE
| Name | 2023 Bonus Target (% of base salary) | 2024 Bonus Target (% of base salary) | 2024 Bonus Target ($) | | Jason T. Liberty | 200 | 200 | 2,700,000 | | Naftali Holtz | 120 | 120 | 1,086,000 | | Michael W. Bayley | 145 | 145 | 1,628,350 | | Laura Hodges Bethge | 100 | 110 | 883,300 | | Harri U. Kulovaara(1) | 100 | 100 | 907,000 |
PERFORMANCE-BASED ANNUAL INCENTIVE
(1)Based on his unique and focused responsibilities, in addition to his bonus target, Mr. Kulovaara’s employment agreement provides that he is entitled to a bonus of $150,000 for each ship delivered during a fiscal year. During fiscal year 2024, the Company took delivery of three new ships. How we measure annual performance. For 2024, the Talent and Compensation Committee continued to evaluate annual performance based on: (1)company-wide performance as well as brand performance, depending on the NEO’s areas of responsibility; and (2)for NEOs other than the CEO, individual performance against previously established strategic objectives. Company-wide and brand performance is measured 65% based on financial measures (adjusted earnings per share for company-wide performance and adjusted brand-specific operating income for brand performance) and 35% based on a composite of financial, operational, and other key performance indicators (“KPIs”). In setting the goals for each metric, the Talent and Compensation Committee considered 2023 business results and the 2024 operating plan, which takes into account our anticipated performance, our growth and profitability objectives as well as the economic climate. The target goal for the company-wide financial performance metrics (Adjusted EPS, Net Yield, and Net Cruise Costs, excluding fuel) were set at a level consistent with the Company’s public guidance issued in February 2024, which represented challenging performance goals as compared to actual 2023 results. Actual award payouts are determined following the completion of the program year by measuring actual performance against each metric target goal.
PERFORMANCE-BASED ANNUAL INCENTIVE
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PERFORMANCE-BASED ANNUAL INCENTIVE
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PERFORMANCE-BASED ANNUAL INCENTIVE
For 2024, the framework of the Executive Bonus Plan was as follows:
PERFORMANCE-BASED ANNUAL INCENTIVE
| | 2024 Executive Bonus Plan Framework | | | | Name | Company- Wide Performance (%) | Brand Performance (%) | Individual Performance Against Strategic Objectives (%) | | Jason T. Liberty | 100 | – | – | | Naftali Holtz | 66.7 | – | 33.3 | | Michael W. Bayley(1) | 33.3 | 33.4 | 33.3 | | Laura Hodges Bethge(2) | 33.3 | 33.4 | 33.3 | | Harri U. Kulovaara | 66.7 | – | 33.3 |
PERFORMANCE-BASED ANNUAL INCENTIVE
(1)Brand performance based on Royal Caribbean (2)Brand performance was based on Celebrity Cruises
METRICS COMPRISING THE EXECUTIVE BONUS PLAN
METRICS COMPRISING THE EXECUTIVE BONUS PLAN
COMPANY-WIDE FINANCIAL METRIC
| Metric | Weighting (%) | Payout as a % of Target | | | | | | | 2024 Actual Results ($) | Payout (%) | | | | 0% ($) | 50% ($) | 90% ($) | 100% ($) | 110% ($) | 150% ($) | 200% ($) | | | | Adjusted EPS | 65 | 9.05 | 9.30 | 9.50 | 9.60 | 9.70 | 9.90 | 10.15 | 11.80(1)(2) | 200 |
COMPANY-WIDE FINANCIAL METRIC
The Talent and Compensation Committee established performance levels for each metric at which executives could earn from a threshold of 0% up to a maximum of 200%, along with performance measures identified at 90%, 100%, 110%, and 150%. The Talent and Compensation Committee capped the maximum performance at 200% for both the company-wide and brand performance metrics and the individual performance metric. Achievement in between these performance levels would be calculated on a linear basis. In evaluating the company-wide performance under each the above KPIs: •With regard to our Financial KPIs, the Company outperformed the target on net yield change, resulting in 200% payout, but did not meet the threshold level of performance with regard to net cruise costs. •Our Non-Financial KPIs paid out on average at 166% of target, primarily attributable to exceeding the benchmarks for employee engagement and guest satisfaction; and •Our Corporate Responsibility composite index achieved 200% payout across the three subcomponents. Individual Performance. The individual performance component of our Executive Bonus Plan awards is intended to reward managerial decision-making, behavioral interaction, and overall contribution. As discussed above, individual performance represented 33.3% of the bonus opportunity for each of our NEOs except for Mr. Liberty, as his bonus was based 100% on corporate performance. None of the individual goals are material to understanding the Executive Bonus Program or how annual targets were determined for 2024. The Talent and Compensation Committee approves the final individual achievement and bonus payout for each of the other NEOs based on the CEO’s recommendation. The Talent and Compensation Committee considered each NEOs achievement of his or her individual goals and the results of specific projects they were responsible for during the year. In evaluating the performance of each NEO during 2024, the Talent and Compensation Committee considered the following Company achievements, among others: •Exceeded ambitious financial guidance set at the start of 2024, propelled by significant demand for its brands from new and repeat guests; •Achieved long-term Trifecta financial goals eighteen months ahead of schedule; •Demonstrated continued commitment to strengthening the balance sheet, refinancing approximately $6.1 billion of high cost debt, eliminating restrictions on our ability to return capital to shareholders, and eliminating all security and guarantees; •Announced expansions to the private destinations portfolio, and continued to generate enthusiasm and interest in industry- leading brands and innovative ships; •Focused on innovation in sourcing model and yield management tools, to capture demand from new consumer bases and to attract the highest-yielding guests; •Took delivery of three ships: Utopia of the Seas, Silver Ray, and Mein Schiff 7 (through TUI Cruises, our 50% joint venture); and •Continued focus on innovations, including preparing for the delivery in 2025 of Celebrity Xcel, which is expected to have the first methanol-capable tri-fuel engine.
2024 EXECUTIVE BONUS PLAN PAYOUTS
2024 EXECUTIVE BONUS PLAN PAYOUTS Based on the above KPIs and financial performance results, the following table shows the 2024 Executive Bonus Plan payout as a percentage of target for each award component and the total payout amount.
2024 EXECUTIVE BONUS PLAN PAYOUTS
| Name | Payout % per Component | | | Total Payout (% rounded) | Target 2024 Payout ($) | Total 2024 Payout ($) | | | Corporate | Brand | Individual | | | | | Jason T. Liberty | 181.9 | N/A | N/A | 182 | 2,700,000 | 4,911,300 | | Naftali Holtz | 181.9 | N/A | 140 | 168 | 1,086,000 | 1,823,908 | | Michael W. Bayley | 181.9 | 181.7 | 140 | 168 | 1,628,350 | 2,733,685 | | Laura Hodges Bethge | 181.9 | 167 | 140 | 163 | 883,300 | 1,438,181 | | Harri U. Kulovaara | 181.9 | — | 135 | 166 | 907,000 | 1,958,180 |
2024 EXECUTIVE BONUS PLAN PAYOUTS
In addition to his award under the Executive Bonus Plan, the Compensation Committee awarded Mr. Kulovaara a special performance bonus of $450,000 for the delivery of three new ships in 2024: Utopia of the Seas, Silver Ray, and Mein Schiff 7 (through TUI Cruises, our 50% joint venture). This success also contributed to Mr. Kulovaara’s individual performance payout.
LONG-TERM EQUITY INCENTIVE AWARDS
LONG-TERM EQUITY INCENTIVE AWARDS Why we pay equity-based compensation. Our long-term incentive award program is the most significant element of our overall compensation program. During 2024, long-term incentive awards represented 76% of our CEO’s target total direct compensation and an average of 59% of target total direct compensation for our other NEOs. The Talent and Compensation Committee’s philosophy is that a majority of an executive’s compensation should be based directly upon the value of long-term incentive compensation in the form of time-based restricted stock units and performance-based restricted stock units so as to align with shareholder interests, reward the achievement of long-term goals and promote stability and corporate loyalty among the executives. The Talent and Compensation Committee believes that providing executives with the opportunities to acquire significant stakes in our growth and prosperity (through grants of equity-based compensation), while maintaining other components of our compensation program at competitive levels, will incentivize and reward executives for sound business management, develop a high-performance team environment, foster the accomplishment of short-term and long-term strategic and operational objectives and compensate executives for improvement in shareholder value, all of which are essential to our ongoing success. How equity-based compensation is determined. Annually, the Talent and Compensation Committee evaluates the appropriate form and mix of equity-based compensation that the Company will grant as part of its long-term incentive compensation and approves the dollar value of long-term equity awards that will be granted to each NEO. In the beginning of each year, the Talent and Compensation Committee determines the target equity award value (“LTI Value”) to be delivered to each NEO. In determining the appropriate long-term incentive award value, the Talent and Compensation Committee considers: •the compensation paid to comparable executives in the Market Comparison Group; •a review of each of the elements of total direct compensation; and •the NEO’s contribution to the overall results of the Company. To strike an appropriate balance between performance and retention incentives, we use a combination of time-based restricted stock units/shares, which we refer to as Time-Based RSUs, and performance-based restricted stock units/shares, which we refer to as PSUs. Time-Based Equity. To promote retention and align our executive’s interests with long-term stock appreciation, the Time- Based RSUs vest in equal annual installments over three-year period commencing on the first anniversary date of the grant. As Time-Based RSUs are inherently tied to the performance of our common stock, we consider a vesting schedule based on continued service appropriate to incentivize retention and performance. Performance-Based Equity. Each PSU is expressed as a target number of PSUs based upon the fair market value of our common stock on the grant date. Annually, the Talent and Compensation Committee approves (1) the metrics that will be used for the PSUs, (2) the weighting of each metric, and (3) a threshold, target and maximum performance level. The threshold, target and maximum performance levels are set based on prior year performance and our long-term growth targets.
LONG-TERM EQUITY INCENTIVE AWARDS
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LONG-TERM EQUITY INCENTIVE AWARDS
| COMPENSATION DISCUSSION AND ANALYSIS | TABLE OF CONTENTS |
2024 EQUITY AWARDS
2024 EQUITY AWARDS Ensuring that NEO compensation continues to motivate senior leadership to act consistent with long-term shareholder interests and fostering the retention of our senior leadership remain key priorities of our executive compensation program. Coming off another strong performance year, the Talent and Compensation Committee approved increases in LTI Values for certain NEOs as noted below. The Committee increased Mr. Liberty's LTI Values in recognition of his strong performance and to improve market competitiveness of his total compensation. For Mr. Holtz and Ms. Hodges Bethge, the changes were intended to bring their LTI Values closer to market median. For Mr. Bayley and Mr. Kulovaara, their LTI Values were reduced in recognition that their LTI values from 2023 reflected enhanced values tied to performance over the Trifecta period and their 2024 total compensation was market competitive. Accordingly, the Talent and Compensation Committee approved the following target LTI values for each of our NEOs in 2024:
2024 EQUITY AWARDS
| Name | 2023 LTI Value ($) | 2024 LTI Value ($) | Percentage Change (%) | | Jason T. Liberty | 11,500,000 | 13,000,000 | 13.0 | | Naftali Holtz | 2,520,000 | 3,100,000 | 23.0 | | Michael W. Bayley | 7,000,000 | 5,000,000 | (28.6) | | Laura Hodges Bethge | 1,500,000 | 2,000,000 | 33.3 | | Harri U. Kulovaara | 1,790,000 | 1,750,000 | (2.2) |
2024 EQUITY AWARDS
As discussed above, the Talent and Compensation Committee then allocated the total LTI Value between Time-Based RSUs and PSUs. For the 2024 compensation program, we provided long-term incentive awards for all NEOs allocated as set forth below which is consistent with the 2023 allocation. The Talent and Compensation Committee believes that the use of both Time-Based RSUs and PSUs is consistent with competitive market practice and that the allocation set forth below effectively and efficiently balances both performance and retention objectives.
2024 EQUITY AWARDS
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2024 EQUITY AWARDS
| TABLE OF CONTENTS | COMPENSATION DISCUSSION AND ANALYSIS |
2024-2026 PERFORMANCE-BASED EQUITY AWARDS
2024-2026 PERFORMANCE-BASED EQUITY AWARDS For the PSU Awards granted in 2024 for the period ending December 2026, the Talent and Compensation Committee determined to keep the design and equity mix substantially consistent with those implemented in fiscal year 2023, with the exception of the removal of Adjusted EBITDA per APCD as a performance metric, which was specific to the 2023-2025 performance period in order to align to the financial goals of the Trifecta program. Management and the Talent and Compensation Committee believe Adjusted EPS and ROIC metrics (as described below) continue to be essential to successful execution of our strategic priorities. The performance ranges for each metric were set at target levels above 2023 results and reflecting year-over-year growth.
2024-2026 PERFORMANCE-BASED EQUITY AWARDS
| Metric | Weight | Description | | Adjusted Earnings per Share (Adjusted EPS) | 45% | Represents Adjusted EPS as reported by the Company in its Form 10-K for the relevant performance periods. Adjusted EPS is Adjusted Net Income (Loss) as reported by the Company in its Form 10-K for the relevant performance periods divided by weighted average shares outstanding or by diluted weighted average shares outstanding, as applicable. As reported, Adjusted Net Income (Loss) represents net income (loss) less net income attributable to noncontrolling interest and excludes certain items for which we believe adjusting for is meaningful when assessing our operating performance on a comparative basis. | | Return on Invested Capital (ROIC) | 45% | Represents Adjusted Operating Income (Loss) as reported by the Company in its Form 10-K for the relevant performance periods divided by Invested Capital. Adjusted Operating Income (Loss) represents operating income (loss) including income (loss) from equity investments and income taxes but excluding certain items for which we believe adjusting for is meaningful when assessing our operating performance on a comparative basis. Invested Capital represents the most recent five-quarter average of total debt (i.e., current portion of long-term debt plus long-term debt) plus total shareholders’ equity. | | Carbon Intensity Reduction | 10% | The carbon intensity metric represents Well-to-Wake (upstream + downstream) grams of carbon dioxide equivalent emissions divided by the product of gross tonnage and nautical miles traveled. The carbon intensity metrics calculates the reduction in this metric from 2019. This metric tracks our decarbonization efforts across the company resulting from increasing regulations and compliance standards. |
DETERMINATION OF EARNED PSUs
DETERMINATION OF EARNED PSUs Performance with regard to the metrics described above will be measured each year during the three-year performance period
DETERMINATION OF EARNED PSUs
| Year | Weighting (%) | | Year 1 - 2024 | 25 | | Year 2 - 2025 | 25 | | Year 3 - 2026 | 50 |
DETERMINATION OF EARNED PSUs
and combined at the end of using the following weighing: For the 2024 PSU awards for the performance period ending December 2026, the Talent and Compensation Committee returned to utilizing a maximum payout of 200% without any additional payout opportunity. Although the PSU Awards measure performance across three one-year periods, the targets for all three years are established up front at the time of grant to ensure a longer-term orientation. In addition, the mix of three annual performance goals with heavier weight attributed to the final year is intended to keep executives focused on consistent performance and growth throughout the duration of the three- year performance period. The aggregate payout level for the PSU grants made in 2024 will be determined by our Talent and Compensation Committee in early 2027.
DETERMINATION OF EARNED PSUs
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DETERMINATION OF EARNED PSUs
| COMPENSATION DISCUSSION AND ANALYSIS | TABLE OF CONTENTS |
PAYOUT UNDER 2022-2024 PERFORMANCE-BASED EQUITY AWARDS
PAYOUT UNDER 2022-2024 PERFORMANCE-BASED EQUITY AWARDS The three-year performance period for the PSUs granted in 2022 ended on December 31, 2024, and the Talent and Compensation Committee assessed our performance in the first quarter of 2025. The following table summarizes performance of the financial metrics for such PSU Awards:
PAYOUT UNDER 2022-2024 PERFORMANCE-BASED EQUITY AWARDS
| Financial Performance Metrics | Weight (%) | Target | Approved results | Payout (as a % of target) | | Adjusted EPS (1) | 30 | $10.00 | $11.80 | 114 | | ROIC (1) | 30 | 10.0% | 16.1% | 150 | | Leverage Ratio (Net Debt/Adjusted EBITDA)(2) | 20 | 3.5 | 3.4 | 103 |
PAYOUT UNDER 2022-2024 PERFORMANCE-BASED EQUITY AWARDS
(1)Refer to page 49 above for definitions of Adjusted EPS and ROIC. (2)Net Debt represents total debt (i.e., the current portion of long-term debt plus long-term debt), plus operating lease liabilities, less cash and cash equivalents as reported in the Company’s financial statements for the period. Adjusted EBITDA is a non-GAAP measure that represents EBITDA, excluding certain items that we believe adjusting for is meaningful when assessing our profitability on a comparative basis. EBITDA is a non-GAAP measure that represents Net Income (Loss) excluding (i) interest income; (ii) interest expense, net of interest capitalized; (iii) depreciation and amortization expenses; and (iv) income tax expense. In addition to the financial performance metrics, the PSUs granted in 2022 included a corporate responsibility composite metric consisting of three categories, each weighing 6.7% for a combined weighing of 20% of target payout: •Environmental initiatives relating to energy efficiency and fuel for our vessels - the Company achieved four of the five initiatives, resulting in a payout of 150% of target. •Employee engagement scores determined based on the corporate average of bi-annual pulse surveys, conducted by an outside firm, of shoreside and shipboard employees measuring both employee satisfaction and employee engagement. This metric achieved a payout of 199% of target. •Cyber maturity rating based on NIST requirements, which achieved a payout of 200% of target. The table below sets forth the final payout amounts for each NEO based on the achievements described above.
PAYOUT UNDER 2022-2024 PERFORMANCE-BASED EQUITY AWARDS
| Name | Target Shares (#) | Final Payout (%) | Shares Earned (#) | | Jason T. Liberty | 52,632 | 136 | 71,580 | | Naftali Holtz | 10,526 | 136 | 14,316 | | Michael W. Bayley | 37,594 | 136 | 51,128 | | Laura Hodges Bethge | 7,519 | 136 | 10,226 | | Harri U. Kulovaara | 11,278 | 136 | 15,339 |
Compensation Consultant
Compensation Consultant As provided for in its charter, the Talent and Compensation Committee has sole discretion to retain a compensation consultant and is directly responsible for the appointment, compensation and oversight for such consultant’s work. In 2024, the Talent and Compensation Committee continued to engage Meridian Compensation Partners, LLC (“Meridian”) as its independent compensation consultant to assist with the design and administration of the Company’s executive compensation pay practices, including the following: •the composition of our Market Comparison Group; •our compensation plan risk; •current trends in executive and director compensation design; •the overall levels of compensation and types and blend of various compensation elements; and •changes in the regulatory or governance environment for executive compensation issues. Meridian attended meetings of the Talent and Compensation Committee and had direct access to the Talent and Compensation Committee’s members during the period of its engagement in 2024. In addition, Meridian regularly conferred with our senior management and human resources department to collect, analyze and present data requested by the Talent and Compensation Committee.
Compensation Consultant
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Compensation Consultant
| COMPENSATION DISCUSSION AND ANALYSIS | TABLE OF CONTENTS |
Market Comparison Group
Market Comparison Group Our Market Comparison Group is an integral component of our annual compensation review — which begins in September and runs through February — and is used to help guide the Talent and Compensation Committee’s decisions regarding competitive pay levels and design architecture.
HOW WE CHOOSE OUR MARKET COMPARISON GROUP
HOW WE CHOOSE OUR MARKET COMPARISON GROUP In making its determinations for fiscal year 2024 compensation, the Talent and Compensation Committee considered publicly available information of a select group of peer companies to inform the pay levels and structures for the NEOs. The list of companies that comprise our Market Comparison Group is reviewed annually in consultation with Meridian, our independent compensation consultant. The Talent and Compensation Committee evaluated the peer group using the following criteria: •Availability of public information — company is publicly-traded and compensation data is available in public filings •Relevant industry group — company included within the consumer discretionary sector under the Global Industry Classification Standard (GICS) •Equivalent revenue — company is within approximately 0.5 to 2 times our revenue •Similar business strategy — company falls under hospitality, hotels and motels, leisure time, leisure products or resort industry categories •Global Footprint — company has significant operations outside of the United States •Historical precedent — company included in the prior year’s Market Comparison Group Based on considerations of the factors above, Meridian recommended, and the Talent and Compensation Committee approved, certain changes to the Market Comparison Group from 2023 as detailed below. The changes were based on review of industry group, market capitalization, revenue range and global footprint.
Amended and Restated Incentive Plan and
Amended and Restated Incentive Plan and
Executive Bonus Plan
Executive Bonus Plan
Royal Caribbean Cruises Ltd. Clawback Policy(1)
Royal Caribbean Cruises Ltd. Clawback Policy(1) Clawback Trigger(s) Restatement due to material noncompliance with financial reporting requirements under the securities laws as required by the Dodd-Frank Act and corresponding NYSE listing standards. The recovery of such compensation applies regardless of whether an executive officer engaged in misconduct in connection with the restatement. (i) If there is a financial restatement due to a material non-compliance with financial reporting requirements; or (ii) with respect to PSU Awards, there is a high likelihood that an out-of-period adjustment to the Company’s financial statements covering the performance period would be deemed material because there is alleged misconduct associated with the adjustment. Compensation Covered PSU Awards and cash bonus PSU Awards and cash bonus Recoupment Amount Amount of compensation granted, vested or paid to a covered person during the performance period that exceeds the amount of compensation that would otherwise have been granted, vested or paid to the person had such amount been determined based on the applicable restatement. An amount equal to the difference between the amount actually awarded based on the erroneous financial data and the amount of compensation that should have been awarded under the accounting restatement or the adjusted financial statements, as applicable, as determined by the Talent and Compensation Committee. Look-Back Period The three fiscal year period preceding the date in which the Company concludes or reasonably should have concluded a restatement is required For PSU Awards: Two-year period following the end of the applicable performance period for each award (1)We filed the Clawback Policy as an exhibit to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Clawback Trigger(s) Restatement due to material noncompliance with financial reporting requirements under the securities laws as required by the Dodd-Frank Act and corresponding NYSE listing standards. The recovery of such compensation applies regardless of whether an executive officer engaged in misconduct in connection with the restatement. (i) If there is a financial restatement due to a material non-compliance with financial reporting requirements; or (ii) with respect to PSU Awards, there is a high likelihood that an out-of-period adjustment to the Company’s financial statements covering the performance period would be deemed material because there is alleged misconduct associated with the adjustment. Compensation Covered PSU Awards and cash bonus PSU Awards and cash bonus Recoupment Amount Amount of compensation granted, vested or paid to a covered person during the performance period that exceeds the amount of compensation that would otherwise have been granted, vested or paid to the person had such amount been determined based on the applicable restatement. An amount equal to the difference between the amount actually awarded based on the erroneous financial data and the amount of compensation that should have been awarded under the accounting restatement or the adjusted financial statements, as applicable, as determined by the Talent and Compensation Committee. Look-Back Period The three fiscal year period preceding the date in which the Company concludes or reasonably should have concluded a restatement is required For PSU Awards: Two-year period following the end of the applicable performance period for each award
Equity Grant Practices
Equity Grant Practices Timing of Equity Awards: The Talent and Compensation Committee generally grants annual equity awards to NEOs and other members of management at the first regularly scheduled Talent and Compensation Committee meeting of the calendar year, usually held in February. Equity awards may be granted outside of the annual grant cycle in connection with events such as hiring, promotion or extraordinary performance or as part of a special retention effort. We do not currently grant stock options to our employees. The Talent and Compensation Committee did not take material nonpublic information into account when determining the timing and terms of equity awards in 2024. Further, the Company has not timed the disclosure of material nonpublic information to affect the value of executive compensation. Vesting Into Retirement Policy: Certain of our executives may be eligible for accelerated or continued vesting of applicable long-term equity awards under our “Vesting Into Retirement” policy. In recognition that different motivations and considerations prevail for officers approaching retirement, awards granted to executives who are at least 62 years of age and who have been employed by RCG for at least 15 years are generally not subject to forfeiture upon termination of employment after the later of the first anniversary of the grant date and the first anniversary of the date that the officer meets both the age and service criteria. In order to maintain an alignment of interest with our shareholders, these awards continue to be subject to restrictions on transfer that will lift over the vesting schedule for the RSUs and PSUs awards.
Equity Grant Practices
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| COMPENSATION DISCUSSION AND ANALYSIS | TABLE OF CONTENTS |
SUMMARY COMPENSATION TABLE
SUMMARY COMPENSATION TABLE The following table presents certain summary information for the fiscal years ended December 31, 2022, 2023 and 2024 concerning compensation earned for services rendered in all capacities by our NEOs.
SUMMARY COMPENSATION TABLE
| Name and Principal Position | Year | Salary / Fees ($) | Stock Awards(1)(2) ($) | Non-Equity Incentive Plan Compensation(3) ($) | Change in Pension Value and NQDC Earnings ($) | All Other Compensation(5) ($) | Total ($) | | Jason T. Liberty President and Chief Executive Officer | 2024 | 1,342,308 | 12,999,935 | 4,911,300 | | 244,278 | 19,497,820 | | | 2023 | 1,246,986 | 11,500,037 | 4,280,000 | - | 189,252 | 17,216,275 | | | 2022 | 1,200,000 | 7,000,056 | 2,344,800 | - | 219,402 | 10,764,258 | | Naftali Holtz Chief Financial Officer | 2024 | 896,923 | 3,099,991 | 1,823,908 | | 57,081 | 5,877,903 | | | 2023 | 792,466 | 2,520,003 | 1,527,680 | - | 45,283 | 4,885,432 | | | 2022 | 675,000 | 1,400,011 | 709,645 | - | 33,396 | 2,818,052 | | Michael W. Bayley President and CEO, Royal Caribbean | 2024 | 1,120,077 | 4,999,919 | 2,733,685 | | 156,373 | 9,010,054 | | | 2023 | 1,082,890 | 7,000,026 | 2,585,374 | - | 141,325 | 10,809,615 | | | 2022 | 1,046,849 | 5,000,029 | 1,590,035 | - | 128,847 | 7,765,760 | | Laura Hodges Bethge(4) President, Celebrity Cruises | 2024 | 798,923 | 1,999,943 | 1,438,181 | | 102,167 | 4,339,215 | | | 2023 | 724,104 | 1,487,832 | 1,043,750 | - | 90,971 | 3,346,657 | | Harri U. Kulovaara EVP, Maritime | 2024 | 904,923 | 1,749,966 | 1,958,180 | | 134,584 | 4,747,653 | | | 2023 | 878,222 | 1,790,040 | 1,865,040 | - | 126,294 | 4,659,596 | | | 2022 | 847,948 | 1,500,001 | 1,151,632 | - | 115,759 | 3,615,340 |
SUMMARY COMPENSATION TABLE
(1)The amounts in this column reflect the aggregate grant date fair value of awards computed in accordance with FASB ASC Topic 718.
SUMMARY COMPENSATION TABLE
| Name and Principal Position | Year | Salary / Fees ($) | Stock Awards(1)(2) ($) | Non-Equity Incentive Plan Compensation(3) ($) | Change in Pension Value and NQDC Earnings ($) | All Other Compensation(5) ($) | Total ($) | | Jason T. Liberty President and Chief Executive Officer | 2024 | 1,342,308 | 12,999,935 | 4,911,300 | | 244,278 | 19,497,820 | | | 2023 | 1,246,986 | 11,500,037 | 4,280,000 | - | 189,252 | 17,216,275 | | | 2022 | 1,200,000 | 7,000,056 | 2,344,800 | - | 219,402 | 10,764,258 | | Naftali Holtz Chief Financial Officer | 2024 | 896,923 | 3,099,991 | 1,823,908 | | 57,081 | 5,877,903 | | | 2023 | 792,466 | 2,520,003 | 1,527,680 | - | 45,283 | 4,885,432 | | | 2022 | 675,000 | 1,400,011 | 709,645 | - | 33,396 | 2,818,052 | | Michael W. Bayley President and CEO, Royal Caribbean | 2024 | 1,120,077 | 4,999,919 | 2,733,685 | | 156,373 | 9,010,054 | | | 2023 | 1,082,890 | 7,000,026 | 2,585,374 | - | 141,325 | 10,809,615 | | | 2022 | 1,046,849 | 5,000,029 | 1,590,035 | - | 128,847 | 7,765,760 | | Laura Hodges Bethge(4) President, Celebrity Cruises | 2024 | 798,923 | 1,999,943 | 1,438,181 | | 102,167 | 4,339,215 | | | 2023 | 724,104 | 1,487,832 | 1,043,750 | - | 90,971 | 3,346,657 | | Harri U. Kulovaara EVP, Maritime | 2024 | 904,923 | 1,749,966 | 1,958,180 | | 134,584 | 4,747,653 | | | 2023 | 878,222 | 1,790,040 | 1,865,040 | - | 126,294 | 4,659,596 | | | 2022 | 847,948 | 1,500,001 | 1,151,632 | - | 115,759 | 3,615,340 |
SUMMARY COMPENSATION TABLE
Consequently, the amount reported in this column represents the fair value of the award at the service inception date (i.e., the date the Talent and Compensation Committee authorized the award) based upon the probable outcome of the performance conditions. See Note 11 of the consolidated financial statements in the Company’s Annual Report for the year ended December 31, 2024, regarding assumptions underlying the valuation of each of these types of awards. (2)Amounts for 2024 include the grant date fair value of both the time-based awards and performance-based annual equity awards granted to each NEO in February 2024. The values on the service inception date of the performance-based awards granted to the NEOs as part of the February 2024 annual equity awards (assuming that the highest level of performance conditions will be achieved (i.e., 200%)) are the following: Mr. Liberty – $20,799,920; Mr. Holtz – $4,960,010; Mr. Bayley – $7,999,895; Mr. Kulovaara – $2,799,945; and Ms. Bethge – $3,199,885. (3)Represents amounts earned pursuant to the annual Executive Bonus Plan. We make payments under our annual Executive Bonus Plan in the first quarter following the fiscal year in which they were earned. In addition to the amounts earned under the Executive Bonus Plan, Mr. Kulovaara is entitled to receive a bonus of $150,000 per ship delivered during the year. During 2024, RCG took delivery of three ships and Mr. Kulovaara received a ship delivery bonus of $450,000, in addition to the $1,508,180 he earned under the Executive Bonus Plan for 2024. (4)Ms. Bethge was promoted in May 2023 to her position as President, Celebrity Cruises. (5)Please see the table below titled “2024 All Other Compensation” for an itemized disclosure of this element of compensation.
SUMMARY COMPENSATION TABLE
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SUMMARY COMPENSATION TABLE
| TABLE OF CONTENTS | EXECUTIVE COMPENSATION TABLES |
Grants of Plan Based Awards in 2024
Grants of Plan Based Awards in 2024 The following table provides information about cash (non-equity) and equity incentive compensation awarded to our NEOs in 2024, including (1) the range of possible cash payouts under our annual Executive Bonus Plan; (2) the grant date of equity awards; (3) the number of time-based and performance-based restricted stock units granted; and (4) the grant date fair value of the time-based and performance-based equity grants calculated in accordance with FASB ASC Topic 718. The time-based and performance-based equity awards were granted under the Company’s 2008 Equity Incentive Plan, which is discussed in greater detail in this proxy statement under the caption “Compensation Discussion and Analysis.”
Grants of Plan Based Awards in 2024
| Name | Estimated Future Payouts Under Non-Equity Incentive Plan Awards(1) | | | Grant Date | Type of Awards | Estimated Future Payouts Under Equity Incentive Plan Awards(3) | | | All Other Stock Awards: Number of Shares of Stocks or Units (#) | Grant Date Fair Value of Stock Awards(4) ($) | | | Threshold ($) | Target ($) | Maximum ($) | | | Threshold ($) | Target ($) | Maximum ($) | | | | Jason T. Liberty | 0 | 2,700,000 | 5,400,000 | | | | | | – | – | | | | | | 2/8/24 | PSU(5) | – | 64,496 | 128,992 | -- | 7,799,985 | | | | | | 2/8/24 | RSU(6) | | -- | -- | 42,997 | 5,199,950 | | Naftali Holtz | 0 | 1,086,000 | 2,172,000 | | | | -- | -- | -- | -- | | | | | | 2/8/24 | PSU(5) | – | 15,380 | 30,760 | -- | 1,860,019 | | | | | | 2/8/24 | RSU(6) | | -- | -- | 10,253 | 1,239,972 | | Michael W. Bayley | 0 | 1,628,350 | 3,256,700 | | | | -- | -- | -- | -- | | | | | | 2/8/24 | PSA(5) | – | 24,806 | 49,612 | -- | 2,999,976 | | | | | | 2/8/24 | RSU(6) | | -- | -- | 16,537 | 1,999,943 | | Laura Hodges Bethge | 0 | 883,300 | 1,766,600 | | | | -- | -- | -- | -- | | | | | | 2/8/24 | PSU(5) | – | 9,922 | 19,844 | -- | 1,199,942 | | | | | | 2/8/24 | RSU(6) | | | | 6,615 | 800,002 | | Harri U. Kulovaara | 0 | 907,000 | 1,814,000 | | | | -- | -- | -- | -- | | | | 450,000(2) | | | | | -- | -- | -- | -- | | | | | | 2/8/24 | PSA(5) | – | 8,682 | 17,364 | -- | 1,049,979 | | | | | | 2/8/24 | RSU(6) | | -- | -- | 5,788 | 699,986 |
Grants of Plan Based Awards in 2024
(1)These values represent the threshold, target and maximum payouts under the Executive Bonus Plan. As discussed above, payouts under our Executive Bonus Plan range from 0% to 200% based on the company-wide and, if applicable, brand-specific performance level achieved and, except in the case of Mr. Liberty, the individual performance level achieved. For additional details on the final payout for each NEO, refer to “2024 Executive Bonus Plan Payouts” on page 47. (2)In addition to the amounts that may be earned pursuant to the Executive Bonus Plan, Mr. Kulovaara is eligible to receive an incentive payment equal to $150,000 for each ship delivered during the year. There were three ship deliveries for 2024. (3)These values represent the threshold, target and maximum number of shares that may be earned pursuant to the performance-based award for the relevant performance period. As discussed above, payout on the performance-based awards range from 0% to 200% based on the company-wide performance level achieved. For the annual performance-based awards granted in 2024, the PSUs or PSAs will vest based on the achievement of certain performance metrics as further described in the Compensation Discussion and Analysis, beginning on page 35. (4)Grant date fair value is calculated in accordance with FASB ASC Topic 718. With respect to the performance-based share awards, the amount reported in this column represents the fair value of the award at the service inception date (i.e., the date the Talent and Compensation Committee authorized the award) based upon the probable outcome of the performance conditions (i.e., target). See Note 11 of the consolidated financial statements in the Company’s Annual Report for the year ended December 31, 2024, regarding assumptions underlying the valuation of each of these types of awards. (5)Represents annual performance-based awards granted on February 8, 2024, which will be earned based on RCG’s performance for the three-year period ending December 31, 2026. (6)Represents the annual time-based RSUs granted on February 8, 2024, which will vest, or for which the transfer restrictions will lapse, in three equal annual installments.
Grants of Plan Based Awards in 2024
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Grants of Plan Based Awards in 2024
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Outstanding Equity Awards at 2024 Fiscal Year End
Outstanding Equity Awards at 2024 Fiscal Year End The following table provides information concerning unvested restricted stock units and performance share awards for each NEO outstanding as of the end of the fiscal year ended December 31, 2024. Each award is shown separately for each NEO.
Outstanding Equity Awards at 2024 Fiscal Year End
| | | Stock Awards | | | | | | | | | Equity Incentive Plan Awards | | | Name | Equity Award Grant Date | # of Shares or Units of Stock That Have Not Vested (#) | Market value of Shares or Units of Stock That Have Not Vested(1) ($) | # of Unearned Shares/Units or Other Rights That Have Not Vested (#) | Market or Payout Value of Unearned Shares/Units or Other Rights that Have Not Vested(1) ($) | | Jason T. Liberty | 2/7/2022 | | | 105,264(3) | 24,283,352 | | | 2/9/2023 | | | 277,536(4) | 64,024,780 | | | 2/8/2024 | | | 128,992(5) | 29,757,164 | | | 3/24/2021 | 4,126(2) | 951,827 | | | | | 2/7/2022 | 17,544(2) | 4,047,225 | | | | | 2/9/2023 | 41,119(2) | 9,485,742 | | | | | 2/8/2024 | 42,997(2) | 9,918,978 | | | | | | 105,786 | 24,403,772 | 511,792 | 118,065,296 | | Naftali Holtz | 2/7/2022 | | | 21,052(3) | 4,856,486 | | | 2/9/2023 | | | 60,816(4) | 14,029,643 | | | 2/8/2024 | | | 30,760(5) | 7,096,024 | | | 3/24/2021 | 766(2) | 176,709 | | | | | 2/7/2022 | 3,508(2) | 809,261 | | | | | 2/9/2023 | 9,010(2) | 2,078,517 | | | | | 2/8/2024 | 10,253(2) | 2,365,265 | | | | | | 23,537 | 5,429,751 | 112,628 | 25,982,153 | | Michael W. Bayley | 2/7/2022 | | | 75,188(3) | 17,345,120 | | | 2/9/2023 | | | 168,936(4) | 38,971,846 | | | 2/8/2024 | | | 49,612(5) | 11,444,992 | | | 2/8/2024 | 16,537(2) | 3,814,921 | | | | | | 16,537 | 3,814,921 | 293,736 | 67,761,958 | | Laura Hodges Bethge | 2/7/2022 | | | 15,038(3) | 3,469,116 | | | 2/9/2023 | | | 31,857(4) | 7,349,091 | | | 2/8/2024 | | | 19,844(5) | 4,577,812 | | | 3/24/2021 | 773(2) | 178,323 | | | | | 2/7/2022 | 2,506(2) | 578,109 | | | | | 2/9/2023 | 4,720(2) | 1,088,857 | | | | | 6/1/2023 | 1,361(2) | 313,969 | | | | | 2/8/2024 | 6,615(2) | 1,526,014 | | | | | | 15,975 | 3,685,273 | 66,739 | 15,396,020 |
Outstanding Equity Awards at 2024 Fiscal Year End
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Outstanding Equity Awards at 2024 Fiscal Year End
| EXECUTIVE COMPENSATION TABLES | TABLE OF CONTENTS |
Outstanding Equity Awards at 2024 Fiscal Year End
| | | Stock Awards | | | | | | | | | Equity Incentive Plan Awards | | | Name | Equity Award Grant Date | # of Shares or Units of Stock That Have Not Vested (#) | Market value of Shares or Units of Stock That Have Not Vested(1) ($) | # of Unearned Shares/Units or Other Rights That Have Not Vested (#) | Market or Payout Value of Unearned Shares/Units or Other Rights that Have Not Vested(1) ($) | | Harri U. Kulovaara | 2/7/2022 | | | 22,556(3) | 5,203,444 | | | 2/9/2023 | | | 43,200(4) | 9,965,808 | | | 2/8/2024 | | | 17,364(5) | 4,005,701 | | | 2/8/2024 | 5,788(2) | 1,335,234 | | | | | | 5,788 | 1,335,234 | 83,120 | 19,174,953 |
Outstanding Equity Awards at 2024 Fiscal Year End
(1)Calculated based on the closing stock price of $230.69 of the Company’s common stock on December 31, 2024.
Outstanding Equity Awards at 2024 Fiscal Year End
| | | Stock Awards | | | | | | | | | Equity Incentive Plan Awards | | | Name | Equity Award Grant Date | # of Shares or Units of Stock That Have Not Vested (#) | Market value of Shares or Units of Stock That Have Not Vested(1) ($) | # of Unearned Shares/Units or Other Rights That Have Not Vested (#) | Market or Payout Value of Unearned Shares/Units or Other Rights that Have Not Vested(1) ($) | | Harri U. Kulovaara | 2/7/2022 | | | 22,556(3) | 5,203,444 | | | 2/9/2023 | | | 43,200(4) | 9,965,808 | | | 2/8/2024 | | | 17,364(5) | 4,005,701 | | | 2/8/2024 | 5,788(2) | 1,335,234 | | | | | | 5,788 | 1,335,234 | 83,120 | 19,174,953 |
Outstanding Equity Awards at 2024 Fiscal Year End
(2)Outstanding time-based RSUs vest in accordance with the following schedule: remaining time-based RSUs granted in 2021 through 2022 will vest in four equal annual installments commencing on the first anniversary of the award date; remaining time-based RSUs granted in 2023 and 2024 will vest in three equal annual installments commencing on the first anniversary of the award date. Time-based RSUs awarded to NEOs eligible under the “Vesting into Retirement” policy vest on the later of the first anniversary of the grant date and the first anniversary of the date the officer meets both the age and service criteria; however, these awards remain subject to restrictions on transfer that lapse over the same period during which the RSUs otherwise would have been scheduled to vest. (3)Represents the 2022 PSU Awards for the three-year period ending December 31, 2024, which were earned based on RCG's performance through December 31, 2024 and that vested on February 11, 2025 when the Talent and Compensation Committee determined the actual payout level. See Compensation Discussion and Analysis – “Payout under 2022-2024 Performance-Based Equity Awards" on page 50. (4)Represents the 2023 PSU Awards for the three-year period ending December 31, 2025 that, to the extent earned, will vest on the date in 2026 that the Talent and Compensation Committee sets the actual payout level for purposes of such grant. Reflects the maximum number of PSUs/PSAs that may be earned. For the 2023 PSU Awards, maximum payout is reflected at 300%. (5)Represents the 2024 PSU Awards for the three-year period ending December 31, 2026 that, to the extent earned, will vest on the date in 2027 that the Talent and Compensation Committee sets the actual payout level for purposes of such grant. Reflects the maximum number of PSUs/PSAs that may be earned.
Outstanding Equity Awards at 2024 Fiscal Year End
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Outstanding Equity Awards at 2024 Fiscal Year End
| TABLE OF CONTENTS | EXECUTIVE COMPENSATION TABLES |
Option Exercises and Stock Vested in 2024
Option Exercises and Stock Vested in 2024 The following table provides information for the NEOs on stock option exercises and the time-based RSUs and performance- based awards that vested during 2024, including the number of shares acquired upon exercise or vesting and the value realized, before payment of any applicable withholding tax and broker commissions.
Option Exercises and Stock Vested in 2024
| | Option Awards | Stock Awards(1) | | | Name | Number of Shares Acquired on Exercise (#) | Number of Shares Acquired on Vesting(2) (#) | Value Realized on Vesting(3) ($) | | Jason T. Liberty | – | 113,990 | 14,914,922 | | Naftali Holtz | – | 13,335 | 1,692,859 | | Michael W. Bayley | – | 148,056 | 19,445,346 | | Harri U. Kulovaara | – | 22,862 | 2,936,166 | | Laura Hodges Bethge | – | 10,667 | 1,388,747 |
Option Exercises and Stock Vested in 2024
(1)These columns reflect RSUs, PSUs, and PSAs previously awarded to the named executive officers that vested during 2024. For those executives eligible to participate in the “Vesting into Retirement” policy on the grant date, the time-based RSUs and the PSAs vest on the first anniversary of the grant date; however, the restrictions on transfer or sale of the time-based RSUs only lapse on the anniversary dates of the grant date during the applicable vesting schedule, while the PSAs are only earned at the same time as the PSUs at the end of the relevant performance period when the Talent and Compensation Committee approves the payout level. For those that become eligible to participate in the “Vesting into Retirement” policy between the grant date and the vesting date, the time-based RSUs and the PSUs vest on the later of (i) the first anniversary of the grant date and (ii) the first anniversary of the date the officer meets both the age and service criteria; however, these awards remain subject to the same restrictions on transfer and the same criteria for being earned. (2)Of these amounts, shares were withheld by us to cover tax withholding obligations as follows: Mr. Liberty – 43,788 shares; Mr. Holtz – 4,336; Mr. Bayley – 57,169 shares; Mr. Kulovaara – 7,888 shares, and Ms. Bethge – 3,685 shares. (3)Calculated based on the average of the high and low sales price of the Company’s common stock on the applicable vesting dates.
Option Exercises and Stock Vested in 2024
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Option Exercises and Stock Vested in 2024
| EXECUTIVE COMPENSATION TABLES | TABLE OF CONTENTS |
Payments Upon Termination of Employment
Payments Upon Termination of Employment The following table represents payments and benefits to which the current NEOs would be entitled upon termination of their employment in accordance with their employment agreements and our equity plans and agreements. Termination of employment is assumed to occur, for purposes of this table, on December 31, 2024. Entitlements upon termination of employment are governed by the NEOs’ employment agreements with the Company, which are described under the heading “Employment Agreements.” In addition, the treatment of outstanding equity awards, which are unvested as of the time of termination, are treated in accordance with the agreement and plan applicable to the particular award, as described below. We do not provide any cash payments in the event of a change of control absent an employment termination nor do we increase the amount of cash severance that would be due to a NEO in the event of his or her termination of employment in connection with a change of control.
Payments Upon Termination of Employment
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Payments Upon Termination of Employment
| TABLE OF CONTENTS | EXECUTIVE COMPENSATION TABLES |
Payments Upon Termination of Employment
The table does not include amounts a NEO would be entitled to receive without regard to the circumstances of termination, such as accrued vested equity awards or accrued retirement benefits (if retirement eligible) and deferred compensation. Please see the “Outstanding Equity Awards at 2024 Fiscal Year-End” table for more information.
Payments Upon Termination of Employment
| | | Termination Type | | | | Name | Benefit | Death or Disability ($) | Termination w/o Cause or for Good Reason(2) ($) | “Change of Control w/ Termination” ($) | | Jason T. Liberty | Severance Payment | 2,700,000 | 2,700,000 | 2,700,000 | | | Settlement of Outstanding Annual Bonus Award | 5,400,000 | 5,400,000 | 5,400,000 | | | Settlement of Outstanding Equity Awards(1) | 72,765,624 | -- | 123,112,628 | | | Medical and Dental Benefits Continuation | -- | 34,129 | 34,129 | | | Outplacement Services | -- | 25,000 | 25,000 | | | Total | 80,865,624 | 8,159,129 | 131,271,756 | | Naftali Holtz | Severance Payment | -- | 905,000 | 905,000 | | | Settlement of Outstanding Annual Bonus Award | -- | -- | -- | | | Settlement of Outstanding Equity Awards(1) | 16,082,553 | -- | 27,103,288 | | | Medical and Dental Benefits Continuation | -- | 17,064 | 17,064 | | | Outplacement Services | -- | 25,000 | 25,000 | | | Total | 16,082,553 | 947,064 | 28,050,353 | | Michael W. Bayley | Severance Payment | 2,246,000 | 2,246,000 | 2,246,000 | | | Settlement of Outstanding Annual Bonus Award | 3,256,700 | 3,256,700 | 3,256,700 | | | Settlement of Outstanding Equity Awards(1) | 31,200,592 | -- | 61,474,756 | | | Medical and Dental Benefits Continuation | -- | 21,127 | 21,127 | | | Outplacement Services | -- | 25,000 | 25,000 | | | Total | 36,703,292 | 5,548,827 | 67,023,583 | | Harri U. Kulovaara | Severance Payment | 1,814,000 | 1,814,000 | 1,814,000 | | | Settlement of Outstanding Annual Bonus Award | 1,814,000 | 1,814,000 | 1,814,000 | | | Settlement of Outstanding Equity Awards(1) | 9,261,742 | -- | 17,276,508 | | | Medical and Dental Benefits Continuation | -- | 24,073 | 24,073 | | | Outplacement Services | -- | 25,000 | 25,000 | | | Total | 12,889,742 | 3,677,073 | 20,953,581 | | Laura Hodges Bethge | Severance Payment | -- | 1,606,000 | 1,606,000 | | | Settlement of Outstanding Annual Bonus Award | -- | 1,766,600 | 1,766,600 | | | Settlement of Outstanding Equity Awards(1) | 10,158,434 | -- | 16,205,502 | | | Medical and Dental Benefits Continuation | -- | 12,208 | 12,208 | | | Outplacement Services | -- | 25,000 | 25,000 | | | Total | 10,158,434 | 3,409,808 | 19,615,309 |
Payments Upon Termination of Employment
(1)The cost of Settlement of Outstanding Equity Awards, reflects the following based on the terms of the Plan and the relevant awards agreements: a.upon a termination due to death or disability, (i) all unvested time-based RSUs will immediately vest and (ii) all unearned performance-based awards will be earned at target and, to the extent not yet vested, immediately vest; and b.upon a termination of the executive’s employment by the Company without “cause” or by the executive for “good reason” within 18 months following a “change of control”, (i) all unvested time-based RSUs will immediately vest and (ii) all unearned performance-based awards will be earned based upon the Talent and Compensation Committee’s then best estimate of the shares that have been earned will be awardable at the end of the performance period, and, to the extent not yet vested, immediately vest. For purposes of the table above, we assumed that the Company would meet target for each of the performance-based awards. (2)Outstanding equity awards for each of Mr. Bayley and Mr. Kulovaara will continue to vest in accordance with their terms based on having met the age and service criteria under our Vesting into Retirement Policy.
Payments Upon Termination of Employment
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Payments Upon Termination of Employment
| CEO PAY RATIO | TABLE OF CONTENTS |
CEO Pay Ratio
CEO Pay Ratio In August 2015, pursuant to a mandate of the Dodd Frank Wall Street Reform and Consumer Protection Act, the SEC adopted a rule requiring annual disclosure of the ratio of the median employee’s annual total compensation to the total annual compensation of the Principal Executive Officer (“PEO”). Due to maritime requirements and the practical implications of employment on ships with worldwide operations, our shipboard employees receive certain benefits and accommodations that are not typically provided to shoreside employees including housing and meals while on the ship and medical care for any injuries or illnesses that occur while in the service of the ship. These benefits and accommodations are free of cost to each shipboard employee. Additionally, because our shipboard employees are away from home for extended periods of time while on the ship, they do not work for the entire year. Our shipboard employees also generally reside outside of the U.S., where the cost of living may be significantly lower than in the United States. We calculated median gross wages of our global employee population as of December 31, 2024 (excluding shipboard employees who were not assigned to any sailing during the year and thus did not receive any compensation) to identify our median employee. We did not annualize the pay for our employees when identifying our median. We determined that this person was a crew member whose total compensation for 2024, calculated consistent with Item 402(c) of Regulation $18,799. This figure includes shipboard pension and gratuities directly billed to our guests but excludes any cash gratuities paid directly to the employee by guests. Based upon this methodology and the CEO’s total compensation, as set forth in the Summary Compensation Table, we estimate the ratio of our CEO’s pay to the median employee’s pay is 1037 to 1.
Pay Versus Performance
Pay Versus Performance As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of Regulation S-K, we are providing the following information about the relationship between executive compensation actually paid and the Company’s financial performance.
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE The following table discloses information on “compensation actually paid” (CAP) to our principal executive officer (PEO) and (on average) to our other NEOs during the specified years alongside total shareholder return (TSR) and net income metrics, as well as a Company-selected measure of Adjusted EPS. The Company selected this measure as the most important in linking compensation actually paid to our NEOs for 2024 to Company performance, as Adjusted EPS was the predominant metric used in evaluating company-wide performance under our Executive Bonus Plan (65%) and comprised 45% of PSU awards granted to our NEOs in 2024 for the performance period ending December 2026, as described in more detail in the “Compensation Discussion and Analysis” beginning on page 35. The CAP amounts in the table below reflect a re-valuation of equity awards granted to our Principal Executive Officer(s) (PEOs) and other NEOs. SEC regulations instruct us to back out the grant date fair value of equity awards that is used in the Summary Compensation Table and replace it with values for unvested equity awards at each year end and change in fair value of shares that vested in the year. Accordingly, the CAP is an alternative way of calculating the value for executive equity awards that uses the stock price at year end for unvested grants and at vest dates for those that vest in the year, instead of the stock price at grant for only those awards newly granted in the year. For NEOs that have served for more than the current year, the CAP values are higher because they include values for all prior grants, not just the current year. The Summary Compensation Table already incorporates the value of the cash incentive paid for each year, so that performance-related compensation component is unchanged in the CAP amounts in the table. For 2024, the CAP to our PEO and average CAP to our other NEOs is significantly higher than the amounts shown in the Summary Compensation Table, primarily due to the significant increase in the price of our common stock after the applicable equity award grant dates. Accordingly, the value of our equity awards at vest and the value of unvested awards was higher than the value at grant shown in the Summary Compensation Table. Our stock price increased by 78% from year end 2023 to year end 2024.This stock price increase is aligned with increases in the Company’s Adjusted EPS results for 2024. In addition, the Company's cumulative shareholder return in 2024 was 80%, which significantly outpaced the Dow Jones U.S. Travel & Leisure Index with 2024 TSR of 20%%. For the full year 2024, the company reported Net Income of $2.9 billion or $10.94 per share compared to Net Income of $1.7 billion or $6.31 per share in the prior year. In line with this improved financial performance and stock price increase, the 2024 CAP for our PEO and other NEOs represents a significant increase from 2023.
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
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TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
| TABLE OF CONTENTS | PAY VERSUS PERFORMANCE |
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
| | | | | | | | Value of initial fixed $100 investment based on: | | | | | Fiscal Year | SCT Total Compensation for PEO(1) ($) | Compensation Actually Paid to PEO(2) ($) | SCT Total Compensation for Former PEO ($) | Compensation Actually Paid to Former PEO ($) | Average SCT Total Compensation for Non-PEO NEOs(3) ($) | Average Compensation Actually Paid to Non-PEO NEOs(2) ($) | Company TSR(4) ($) | Peer Group TSR(4) ($) | Net Income (5) ($M) | Adjusted EPS(6) ($) | | 2024 | 19,497,820 | 76,584,558 | – | – | 5,993,706 | 20,032,360 | 175.31 | 170.51 | 2,877 | 11.80 | | 2023 | 17,216,276 | 44,177,396 | n/a | n/a | 6,694,683 | 15,584,264 | 97.95 | 141.75 | 1,697 | 6.77 | | 2022 | 10,764,258 | 3,846,340 | 300,006 | (4,371,814) | 4,738,954 | 1,390,884 | 37.39 | 116.17 | (2,156) | (6.82) | | 2021 | – | – | 15,812,027 | 15,310,661 | 11,154,402 | 10,506,637 | 58.17 | 127.35 | (5,261) | (19.19) | | 2020 | – | – | 12,083,504 | (462,571) | 5,360,290 | 498,183 | 56.50 | 101.09 | (5,798) | (18.31) |
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
(1)Reflects total compensation of our current CEO, Mr. Jason Liberty, as calculated in the Summary Compensation Table (SCT). (2)The dollar amounts shown in these columns reflect “compensation actually paid” to the NEOs calculated in accordance with SEC rules. As required, the dollar amounts include (among other items) unpaid amounts of equity compensation that may be realizable in future periods, and as such, the dollar amounts shown do not fully represent the actual final amount of compensation earned or actually paid to either individual during the applicable years. The adjustments made to each officer’s total compensation for each year to determine CAP are shown in the table below. For Mr. Liberty, information is only included with respect to 2022 through 2024, the years in which he served as CEO.
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
| | 2024 | 2023 | 2022 | | 2021 | 2020 | | | Current PEO ($) | Current PEO ($) | Current PEO ($) | Former PEO ($) | Former PEO ($) | Former PEO ($) | | Total Reported in Summary Compensation Table (SCT) | 19,497,820 | 17,216,276 | 10,764,258 | 300,006 | 15,812,027 | 12,083,504 | | Deduct Change in Pension Value and NQDC Earnings Reported in SCT | – | – | – | – | (156,971) | (154,879) | | Add Pension Service Cost and Impact of Pension Plan Amendments | | – | – | – | – | – | | Deduct Value of Stock Awards Reported in SCT | (12,999,935) | (11,500,037) | (7,000,056) | (200,006) | (11,250,070) | (11,171,146) | | Add Year-End Fair Value of Awards Granted in Fiscal Year that are Unvested and Outstanding | 28,517,206 | 24,266,273 | 4,336,000 | – | 10,198,401 | 7,624,579 | | Add Change in Fair Value of Prior Year Awards that are Outstanding and Unvested | 41,497,491 | 13,323,495 | (4,049,875) | (4,835,434) | 292,027 | (5,771,819) | | Add Change in Fair Value (from Prior Year- End) of Prior Year Awards that Vested in Year | 71,976 | 871,390 | – | 252,107 | – | – | | Add Fair Value of Awards Granted in Fiscal Year that Vested in the Same Fiscal Year | – | – | (203,987) | 111,514 | 415,247 | (3,072,810) | | Deduct Prior Year Fair Value of Prior Year Awards that Failed to Vest this Year | – | – | – | – | – | – | | Total Adjustments | 57,086,738 | 26,961,121 | (6,917,918) | (4,671,820) | (501,366) | (12,546,075) | | Compensation Actually Paid for Fiscal Year | 76,584,558 | 44,177,396 | 3,846,340 | (4,371,814) | 15,310,661 | (462,571) |
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
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TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
| PAY VERSUS PERFORMANCE | TABLE OF CONTENTS |
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
| | 2024 | 2023 | 2022 | 2021 | 2020 | | | Other NEOs ($) | Other NEOs ($) | Other NEOs ($) | Other NEOs ($) | Other NEOs ($) | | Total Reported in Summary Compensation Table (SCT) | 5,993,706 | 6,694,683 | 4,738,954 | 11,154,402 | 5,360,290 | | Deduct Change in Pension Value and NQDC Earnings Reported in SCT | – | | – | (80,359) | (93,950) | | Add Pension Service Cost and Impact of Pension Plan Amendments | | – | – | – | – | | Deduct Value of Stock Awards Reported in SCT | (2,988,569) | (3,329,581) | (2,662,507) | (8,812,501) | (3,093,676) | | Add Year-End Fair Value of Awards Granted in Fiscal Year that are Unvested and Outstanding | 6,498,566 | 7,007,819 | 1,649,220 | 7,988,699 | 2,160,278 | | Add Change in Fair Value of Prior Year Awards that are Outstanding and Unvested | 10,535,629 | 4,686,454 | (2,150,970) | 96,223 | (2,576,592) | | Add Change in Fair Value (from Prior Year- End) of Prior Year Awards that Vested in Year | (6,973) | 524,889 | – | – | – | | Add Fair Value of Awards Granted in Fiscal Year that Vested in the Same Fiscal Year | – | – | (183,813) | 160,173 | (1,258,168) | | Deduct Prior Year Fair Value of Prior Year Awards that Failed to Vest this Year | – | – | – | – | – | | Total Adjustments | 14,038,654 | 8,889,581 | (3,348,070) | (647,765) | (4,862,107) | | Compensation Actually Paid for Fiscal Year | 20,032,360 | 15,584,264 | 1,390,884 | 10,506,637 | 498,183 |
TABULAR DISCLOSURE OF COMPENSATION ACTUALLY PAID VERSUS PERFORMANCE
(3)Reflects the average total compensation of our non-PEO NEOs, as calculated in the SCT for each of the years shown. Our non-PEO NEOs included in the table above are the following individuals: for 2024: Naftali Holtz, Michael Bayley, Harri U. Kulovaara, and Laura Hodges Bethge; for 2023: Naftali Holtz, Michael Bayley, Lisa Lutoff-Perlo, Harri U. Kulovaara, and Laura Hodges Bethge; for 2022: Naftali Holtz, Michael Bayley, Lisa Lutoff-Perlo, and Harri U. Kulovaara; for 2021: Jason Liberty, Michael W. Bayley, Lisa Lutoff-Perlo and Harri U. Kulovaara; and for 2020: Jason Liberty, Michael W. Bayley, Lisa Lutoff-Perlo and Harri U. Kulovaara. (4)Pursuant to SEC rules, the TSR figures assume an initial investment of $100 on December 31, 2019. As permitted by SEC rules, the peer group referenced for purpose of the TSR comparison is the group of companies included in the Dow Jones U.S. Travel and Leisure Index, which is the industry peer group used for purposes of Item 201(e) of Regulation S-K. The separate peer group used by the Talent and Compensation Committee for purposes of determining compensation paid to our executive officers is described on page 52. (5)Reflects after-tax net income (loss) attributable to shareholders prepared in accordance with GAAP for each of the years shown. (6)Adjusted Earnings (Loss) per Share is a non-GAAP financial measure that represents Adjusted Net Income (Loss) divided by weighted average shares outstanding or by diluted weighted average shares outstanding, as applicable. Adjusted Net Income (Loss) represents net income (loss) less net income attributable to noncontrolling interest, excluding certain items for which we believe adjusting for is meaningful when assessing our performance on a comparative basis. Refer to the Annex of this Proxy Statement.
TABULAR DISCLOSURE OF MOST IMPORTANT MEASURES LINKING COMPENSATION ACTUALLY PAID DURING
TABULAR DISCLOSURE OF MOST IMPORTANT MEASURES LINKING COMPENSATION ACTUALLY PAID DURING
2024 TO COMPANY PERFORMANCE
| TABLE OF CONTENTS | PAY VERSUS PERFORMANCE |
DISCLOSURE OF THE RELATIONSHIP BETWEEN COMPENSATION ACTUALLY PAID AND FINANCIAL
DISCLOSURE OF THE RELATIONSHIP BETWEEN COMPENSATION ACTUALLY PAID AND FINANCIAL
PERFORMANCE MEASURES
| PAY VERSUS PERFORMANCE | TABLE OF CONTENTS |
PERFORMANCE MEASURES
| TABLE OF CONTENTS | DIRECTOR COMPENSATION FOR 2024 |
Director Compensation for 2024
Director Compensation for 2024 We pay annual cash retainers of $100,000 to our directors for their service on the Board. We also pay annual cash retainers for chairing and service on various Board committees. The amount of these retainers in 2024 for a full year of service was as follows:
Director Compensation for 2024
| Committee Role | Audit Committee ($) | Talent & Compensation Committee ($) | Nominating & Corporate Governance Committee ($) | Safety, Environment, Sustainability & Health Committee ($) | | Chairman | 35,000 | 25,000 | 20,000 | 20,000 | | Member | 20,000 | 12,000 | 10,000 | 10,000 |
Director Compensation for 2024
Directors do not earn fees for each meeting attended; however, they are reimbursed for their travel expenses and, occasionally, for those of an accompanying guest. Our Lead Director received a further annual cash retainer of $75,000 for 2024. In addition, our Chair of the Board, is entitled to an additional cash retainer of $225,000 annually. Mr. Liberty does not receive any compensation for his service as director. In February 2024, each non-employee director received restricted stock units with a fair market value of $286,864 as of the grant date, based on $220,000 annual grant date value of awards prorated to reflect that there would be fifteen rather than twelve months between grants in 2023 - 2024. These restricted stock units will vest in full after the earlier of (i) one year and (ii) the next annual meeting. Effective February 2024, our stock ownership guidelines require directors to accumulate ownership of at least $500,000 of our common stock (which is five times their annual cash retainer for Board service), including the value of restricted stock and restricted stock units, within three years of becoming a director. If the value of their stock holdings falls below this amount, directors cannot sell shares of our common stock until the value once again exceeds the required amount. In addition, non-employee directors may not be granted awards with a dollar value, which together with cash compensation paid to such director for such calendar year, would exceed $750,000. In order to increase their knowledge and understanding of our business, we encourage our non-employee Board members and their families to experience our cruises. As a result, we have adopted a Non-Management Director Cruise Policy. Under this policy, with certain limited exceptions, a Board member is entitled to up to two complimentary staterooms on two cruises per year for the Board member and any immediate family accompanying the Board member on the cruise. Additional guests traveling with a Board member will receive a 20% discount off the lowest available fare for up to five staterooms, consistent with the benefit provided to other Company employees. These benefits are provided at no incremental cost to the Company. The CEO may grant exceptions to this policy at his discretion but did not do so in 2024.
Director Compensation for 2024
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Director Compensation for 2024
| DIRECTOR COMPENSATION FOR 2024 | TABLE OF CONTENTS |
Director Compensation for 2024
The table below summarizes the compensation of each person serving as a non-employee director in 2024.
Director Compensation for 2024
| Name | Fees Earned or Paid in Cash ($) | Stock Awards(1)(2) ($) | All Other Compensation) ($) | Total ($) | | John F. Brock | 130,572 | 286,864 | – | 417,435 | | Richard D. Fain | 325,000 | 286,864 | – | 611,864 | | Stephen R. Howe, Jr. | 144,286 | 286,864 | – | 431,149 | | William L. Kimsey | 207,143 | 286,864 | – | 494,007 | | Michael O. Leavitt | 120,000 | 286,864 | – | 406,864 | | Amy McPherson | 112,000 | 286,864 | – | 398,864 | | Maritza G. Montiel | 130,285 | 286,864 | – | 417,149 | | Ann S. Moore | 112,000 | 286,864 | – | 398,864 | | Eyal M. Ofer | 120,000 | 286,864 | – | 406,864 | | Vagn O. Sørensen | 145,000 | 286,864 | – | 431,864 | | Donald Thompson | 122,000 | 286,864 | – | 408,864 | | Arne Alexander Wilhelmsen | 120,000 | 286,864 | – | 406,864 | | Rebecca Yeung | 117,143 | 286,864 | – | 404,006 |
Director Compensation for 2024
(1)The column titled “Stock Awards” reports the fair value of restricted stock unit awards at their grant date in 2024 calculated in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718. For the assumptions used in valuing these awards for purposes of computing this expense, please see Note 11 of the consolidated financial statements in the Company’s Annual Report for the year ended December 31, 2024. (2)As of December 31, 2024, each non-employee director listed in the table held 2,372 unvested RSUs that vest one year following the grant date.
Director Compensation for 2024
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Director Compensation for 2024
| TABLE OF CONTENTS | PROPOSAL 3 |