|CARNIVAL CORP filed this Form DEF 14A on 03/07/2019|
Compensation Discussion and Analysis and Carnival plc Directors Remuneration ReportPart I
Although considered to be compensation for performance in fiscal 2018, the MTE grants were made in early fiscal 2019 and, in accordance with SEC disclosure rules, are not shown in the Grants of Plan-Based Awards in Fiscal 2018 table or included in the Outstanding Equity Awards at 2018 Fiscal Year-End table, and the grant date fair value of those shares are not reflected in the Summary Compensation Table. These grants will be reflected in the executive compensation tables in next years Proxy Statement. The MTE grants made during January 2018 were previously discussed in detail in our 2018 Proxy Statement. However, as discussed above, due to SEC disclosure rules, the grant date fair value of these grants are included in this Proxy Statements Summary Compensation Table and Grants of Plan-Based Awards in Fiscal 2018 table.
2018 PBS Grants. The PBS grants made to our Named Executive Officers and other key executives in February 2018 vest zero to 200% of target based upon the extent to which Corporation Operating Income, as adjusted for certain fuel price change and currency exchange rate impacts, for each of the three fiscal years in the 2018-2020 performance cycle and the average of each annual ROIC result for the three-year performance cycle exceeds the specified performance goals. Under the terms of the grant, the Corporation Operating Income result is weighted 60% and ROIC result is weighted 40%. The maximum payout is 200% of target. The Corporation Operating Income target and ROIC target will be disclosed at the end of the performance period (as these targets are deemed strategic and commercially sensitive).
The Compensation Committees believe that growth in the Corporation Operating Income is a critical measure of Carnival Corporation & plcs ability to maintain and grow earnings over time. The grants further align an increasing proportion of the total compensation of key members of our management team (116 senior managers worldwide, including our Named Executive Officers) with the long-term growth of Carnival Corporation & plc.
The Compensation Committees approved the PBS grants to our Named Executive Officers after an evaluation of current market practice, the aggregate market positioning of total direct compensation, and the Compensation Committees focus on the alignment between our Named Executive Officers pay outcomes and Carnival Corporation & plcs long-term performance.
2018 SEA Grants. In April 2018, the Compensation Committees made SEA grants to the Named Executive Officers and certain other key executives. All Named Executive Officers received SEA grants in the form of RSUs of Carnival Corporation common stock.
The SEA grant is based upon Carnival Corporations absolute TSR performance as modified by our TSR rank relative to the Peer Group over the period of December 1, 2017 through November 30, 2020. The maximum possible payout is six times the target number of SEA RSUs, subject to a value cap of seven times the grant date value. While dividends are taken into account in assessing the TSR calculations, these RSUs do not accrue any dividends over the performance period. Absolute TSR growth is calculated using the 90-day average stock price as of December 1, 2017 of $66.04. The earned shares will vest after the Compensation Committees certify the results and are contingent upon continued employment.