Summary
This Form 8-K filing from Carnival Corporation and Carnival plc, dated July 12, 2008, details the adoption of the Carnival Cruise Lines Management Incentive Plan (CCL MIP) for fiscal year 2008 and onwards. The plan aims to incentivize executives within the Carnival Cruise Lines division, including CEO Gerald R. Cahill, by linking bonuses to the operating income performance of both CCL and the parent corporation. The plan establishes a framework for calculating target bonuses and payout ranges based on achieving specific operating income targets.
Key Highlights
- 1Carnival Cruise Lines Management Incentive Plan (CCL MIP) adopted.
- 2The CCL MIP will govern bonus determinations for fiscal year 2008 and subsequent years.
- 3Bonuses are tied to the operating income performance of Carnival Cruise Lines (75% weighting) and Carnival Corporation & plc (25% weighting).
- 4CEO Gerald R. Cahill's target bonus for 2008 is set at $1.1 million.
- 5Bonus payout ranges from 50% of the target bonus for achieving 75% or less of operating income targets, up to 150% for achieving 120% or more.
- 6The Compensation Committees have discretion to adjust targets and exclude certain items (e.g., gains/losses on ship sales) from performance calculations.
- 7The Compensation Committees retain broad discretion to adjust the final bonus amount based on various performance factors beyond operating income.
Frequently Asked Questions
The CCL MIP is designed to focus the attention of Carnival Cruise Lines executives on achieving outstanding performance results, specifically as reflected in the operating income of Carnival Cruise Lines and the overall Carnival Corporation & plc.
Bonuses are calculated based on a 'Bonus Schedule' that calibrates the weighted achievement of CCL Operating Income Target (75%) and Corporation Operating Income Target (25%) against the executive's Target Bonus. Payouts range from 50% to 150% of the Target Bonus based on performance relative to these targets, with interpolation for results between 75% and 120%.
The Target Bonus for Mr. Cahill for fiscal year 2008 is set at $1.1 million.
Yes, the Compensation Committees have significant discretion. They can adjust the operating income targets, exclude certain financial items, and consider a wide range of other performance factors (operational metrics, strategic initiatives, new ship orders, etc.) to increase or decrease the preliminary bonus amount. The final bonus cannot exceed 200% of the Target Bonus.