8-KLeadership ChangesExhibits & Filings

CARNIVAL CORP 8-K Report, Executive Changes (Apr 27, 2017)

Filed April 27, 2017For Securities:CCL

Summary

Carnival Corporation & plc (CCL) filed an 8-K on April 27, 2017, primarily to disclose details of a new employment contract with Michael Olaf Thamm, Group Chief Executive Officer of Costa Group and Carnival Asia. This contract, effective April 1, 2017, replaces a previous agreement and establishes an indefinite term subject to a 12-month notice period. Investors should note the compensation structure, which includes a base salary, target bonuses, and various equity-based incentives for fiscal year 2017, with future compensation determined at the Boards' discretion. The filing also outlines other benefits, including insurance and a housing allowance, as well as compensation and restrictive covenants upon termination. The company is providing Mr. Thamm with a substantial compensation package, including significant equity components, signaling a commitment to retaining key executive talent in important operational roles. Investors may want to consider how executive compensation aligns with company performance and strategic objectives.

Key Highlights

  • 1Carnival plc entered into a new employment contract with Michael Olaf Thamm, Group Chief Executive Officer of Costa Group and Carnival Asia, effective April 1, 2017.
  • 2The contract has an indefinite term, subject to a 12-month notice period.
  • 3For fiscal year 2017, Mr. Thamm's compensation includes a base salary of €860,250, a target bonus of €1,116,000, and eligibility for performance-based restricted stock units and equity grants.
  • 4Mr. Thamm will receive other benefits such as life, disability, and health insurance, plus an annual housing allowance of up to €150,000.
  • 5The contract specifies compensation upon termination, including 12 months' salary if terminated by the company without cause.
  • 6Restrictive covenants for 12 months post-termination include prohibitions on working for competitors and soliciting employees/customers.
  • 7Mr. Thamm will be compensated for these restrictive covenants with 50% of his most recently received total remuneration.

Frequently Asked Questions

The primary purpose of this 8-K filing is to disclose the terms of a new employment contract entered into by Carnival plc with Michael Olaf Thamm, the Group Chief Executive Officer of Costa Group and Carnival Asia.

For fiscal year 2017, Mr. Thamm has a base salary of €860,250. His target bonus under the MIP is €1,116,000. He is also eligible for €1,116,000 in performance-based restricted stock units at target and €465,000 in MIP-tied equity grant at target, plus a $600,000 shareholder equity alignment grant at target. The total target compensation for fiscal year 2017, excluding the shareholder equity grant which is in USD, is approximately €2,431,000 plus the USD grant.

Following fiscal year 2017, Mr. Thamm’s base salary, annual incentive payments, and long-term incentive awards will be determined by the Boards of Directors at their discretion, in accordance with the terms of relevant company plans.

The company can terminate the contract at any time. If terminated without cause, Mr. Thamm is entitled to 12 months' salary. Mr. Thamm can terminate by giving 12 months' notice. If terminated by the company for cause, he receives no further compensation. He will also receive 50% of his most recent total remuneration as compensation for agreeing to restrictive covenants for 12 months post-termination.