10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549 

FORM 10-Q 

(Mark One) 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from            to            

Commission File Number: 1-11884

ROYAL CARIBBEAN CRUISES LTD.

(Exact name of registrant as specified in its charter) 

Republic of Liberia	98-0081645
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1050 Caribbean Way, Miami, Florida 33132

(Address of principal executive offices) (zip code) 

(305) 539-6000

(Registrant’s telephone number, including area code) 

N/A

(Former name, former address and former fiscal year, if changed since last report) 

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	RCL	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes ☒  No ☐ 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes ☒  No ☐ 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. 

Large accelerated filer ☒	Accelerated filer ☐	Non-accelerated filer ☐	Smaller reporting company ☐
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes ☐  No ☒ 

There were 254,956,303 shares of common stock outstanding as of May 2, 2022.

ROYAL CARIBBEAN CRUISES LTD.

TABLE OF CONTENTS

	Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements	1
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	33
Item 3. Quantitative and Qualitative Disclosures About Market Risk	46
Item 4. Controls and Procedures	46
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	47
Item 1A. Risk Factors	47
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	61
Item 6. Exhibits	62
SIGNATURES	63

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(unaudited; in thousands, except per share data)

	Quarter Ended March 31,
	2022		2021
Passenger ticket revenues	$	651,858	$	20,844
Onboard and other revenues	407,373		21,170
Total revenues	1,059,231		42,014
Cruise operating expenses:
Commissions, transportation and other	150,343		2,949
Onboard and other	74,439		4,481
Payroll and related	349,618		96,636
Food	100,184		8,472
Fuel	188,480		41,822
Other operating	321,705		129,127
Total cruise operating expenses	1,184,769		283,487
Marketing, selling and administrative expenses	394,030		258,041
Depreciation and amortization expenses	339,467		310,166
Impairment and credit losses (recoveries)	173		(449)
Operating Loss	(859,208)		(809,231)
Other income (expense):
Interest income	3,322		4,861
Interest expense, net of interest capitalized	(277,659)		(272,514)
Equity investment loss	(31,059)		(59,871)
Other (expense) income	(2,538)		5,033
	(307,934)		(322,491)
Net Loss	$	(1,167,142)	$	(1,131,722)
Loss per Share:
Basic	$	(4.58)	$	(4.66)
Diluted	$	(4.58)	$	(4.66)
Weighted-Average Shares Outstanding:
Basic	254,821		243,004
Diluted	254,821		243,004
Comprehensive Loss
Net Loss	$	(1,167,142)	$	(1,131,722)
Other comprehensive income:
Foreign currency translation adjustments	7,778		9,722
Change in defined benefit plans	12,597		10,463
Gain on cash flow derivative hedges	195,901		10,302
Total other comprehensive income	216,276		30,487
Comprehensive Loss	$	(950,866)	$	(1,101,235)

The accompanying notes are an integral part of these consolidated financial statements

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ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

	As of
	March 31,		December 31,
	2022		2021
	(unaudited)
Assets
Current assets
Cash and cash equivalents	$	1,968,504	$	2,701,770
Trade and other receivables, net of allowances of $6,099 and $13,411 at March 31, 2022 and December 31, 2021, respectively	506,160		408,067
Inventories	179,466		150,224
Prepaid expenses and other assets	344,648		286,026
Derivative financial instruments	178,161		54,184
Total current assets	3,176,939		3,600,271
Property and equipment, net	26,940,867		25,907,949
Operating lease right-of-use assets	535,532		542,128
Goodwill	809,435		809,383
Other assets, net of allowances of $86,594 and $86,781 at March 31, 2022 and December 31, 2021, respectively	1,477,225		1,398,624
Total assets	$	32,939,998	$	32,258,355
Liabilities and Shareholders’ Equity
Current liabilities
Current portion of long-term debt	$	2,558,463	$	2,243,131
Current portion of operating lease liabilities	74,234		68,922
Accounts payable	668,158		545,978
Accrued interest	263,347		251,974
Accrued expenses and other liabilities	774,007		887,575
Derivative financial instruments	101,554		127,236
Customer deposits	3,567,401		3,160,867
Total current liabilities	8,007,164		7,285,683
Long-term debt	19,943,513		18,847,209
Long-term operating lease liabilities	523,924		534,726
Other long-term liabilities	476,469		505,181
Total liabilities	28,951,070		27,172,799
Shareholders’ equity
Preferred stock ($0.01 par value; 20,000,000 shares authorized; none outstanding)	—		—
Common stock ($0.01 par value; 500,000,000 shares authorized; 282,973,716 and 282,703,246 shares issued, March 31, 2022 and December 31, 2021, respectively)	2,830		2,827
Paid-in capital	7,267,545		7,557,297
Retained (deficit) earnings	(718,609)		302,276
Accumulated other comprehensive loss	(494,609)		(710,885)
Treasury stock (28,018,385 and 27,882,987 common shares at cost, March 31, 2022 and December 31, 2021, respectively)	(2,068,229)		(2,065,959)
Total shareholders’ equity	3,988,928		5,085,556
Total liabilities and shareholders’ equity	$	32,939,998	$	32,258,355

The accompanying notes are an integral part of these consolidated financial statements

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ROYAL CARIBBEAN CRUISES LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
	Three Months Ended March 31,
	2022		2021
Operating Activities
Net Loss	$	(1,167,142)	$	(1,131,722)
Adjustments:
Depreciation and amortization	339,467		310,166
Impairment and credit losses (recoveries)	173		(449)
Net deferred income tax benefit	(3,067)		(3,556)
Loss on derivative instruments not designated as hedges	10,873		491
Share-based compensation expense	22,839		18,834
Equity investment loss	31,059		59,871
Amortization of debt issuance costs	39,341		35,581
Amortization of debt discounts and premiums	3,849		29,304
Changes in operating assets and liabilities:
Increase in trade and other receivables, net	(32,236)		(72,397)
Increase in inventories	(29,242)		(3,708)
Increase in prepaid expenses and other assets	(124,394)		(26,118)
Increase (decrease) in accounts payable	112,426		(7,499)
Increase (decrease) in accrued interest	11,373		(15,726)
Decrease in accrued expenses and other liabilities	(130,441)		(134,113)
Increase in customer deposits	406,534		95,923
Other, net	(20,259)		35,935
Net cash used in operating activities	(528,847)		(809,183)
Investing Activities
Purchases of property and equipment	(1,363,086)		(1,061,691)
Cash received on settlement of derivative financial instruments	5,650		3,758
Cash paid on settlement of derivative financial instruments	(77,853)		(27,362)
Investments in and loans to unconsolidated affiliates	—		(70,369)
Cash received on loans to unconsolidated affiliates	4,444		12,519
Proceeds from the sale of property and equipment and other assets	65		175,439
Other, net	(12,361)		146
Net cash used in investing activities	(1,443,141)		(967,560)
Financing Activities
Debt proceeds	2,349,969		2,494,077
Debt issuance costs	(93,763)		(82,115)
Repayments of debt	(1,007,632)		(427,978)
Repayments of commercial paper notes	—		(414,570)
Proceeds from common stock issuances	—		1,617,234
Other, net	(10,843)		(2,724)
Net cash provided by financing activities	1,237,731		3,183,924
Effect of exchange rate changes on cash	991		(192)
Net (decrease) increase in cash and cash equivalents	(733,266)		1,406,989

The accompanying notes are an integral part of these consolidated financial statements

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ROYAL CARIBBEAN CRUISES LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in thousands)
	Three Months Ended March 31,
	2022		2021
Cash and cash equivalents at beginning of period	2,701,770		3,684,474
Cash and cash equivalents at end of period	$	1,968,504	$	5,091,463
Supplemental Disclosure
Cash paid during the period for:
Interest, net of amount capitalized	$	225,771	$	228,877
Non-cash Investing Activities
Notes receivable issued upon sale of property and equipment and other assets	$	—	$	16,000
Purchase of property and equipment included in accounts payable and accrued expenses and other liabilities	$	31,899	$	26,882

The accompanying notes are an integral part of these consolidated financial statements

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ROYAL CARIBBEAN CRUISES LTD.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(unaudited; in thousands)

	Common Stock		Paid-in Capital		Retained Earnings (Deficit)		Accumulated Other Comprehensive Loss		Treasury Stock		Total Shareholders' Equity
Balance at January 1, 2022	$	2,827	$	7,557,297	$	302,276	$	(710,885)	$	(2,065,959)	$	5,085,556
Activity related to employee stock plans	3		17,888		37		—		—		17,928
Cumulative effect of adoption of Accounting Standards Update 2020-06	—		(307,640)		146,220		—		—		(161,420)
Changes related to cash flow derivative hedges	—		—		—		195,901		—		195,901
Change in defined benefit plans	—		—		—		12,597		—		12,597
Foreign currency translation adjustments	—		—		—		7,778		—		7,778
Purchase of treasury stock	—		—		—		—		(2,270)		(2,270)
Net Loss	—		—		(1,167,142)		—		—		(1,167,142)
Balance at March 31, 2022	$	2,830	$	7,267,545	$	(718,609)	$	(494,609)	$	(2,068,229)	$	3,988,928

	Common Stock		Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total Shareholders' Equity
Balance at January 1, 2021	$	2,652	$	5,998,574	$	5,562,775	$	(739,341)	$	(2,063,991)	$	8,760,669
Activity related to employee stock plans	2		18,638		—		—		—		18,640
Common stock issuance	170		1,496,106		—		—		—		1,496,276
Changes related to cash flow derivative hedges	—		—		—		10,302		—		10,302
Change in defined benefit plans	—		—		—		10,463		—		10,463
Foreign currency translation adjustments	—		—		—		9,722		—		9,722
Purchase of treasury stock	—		—		—		—		(1,968)		(1,968)
Net Loss	—		—		(1,131,722)		—		—		(1,131,722)
Balance at March 31, 2021	$	2,824	$	7,513,318	$	4,431,053	$	(708,854)	$	(2,065,959)	$	9,172,382

The accompanying notes are an integral part of these consolidated financial statements

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ROYAL CARIBBEAN CRUISES LTD.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

As used in this Quarterly Report on Form 10-Q, the terms “Royal Caribbean,” "Royal Caribbean Group," the “Company,” “we,” “our” and “us” refer to Royal Caribbean Cruises Ltd. and, depending on the context, Royal Caribbean Cruises Ltd.’s consolidated subsidiaries and/or affiliates. The terms “Royal Caribbean International,” “Celebrity Cruises,” and "Silversea Cruises" refer to our wholly owned global cruise brands. Throughout this Quarterly Report on Form 10-Q, we also refer to our partner brands in which we hold an ownership interest, including “TUI Cruises” and "Hapag-Lloyd Cruises." However, because these partner brands are unconsolidated investments, our operating results and other disclosures herein do not include these brands unless otherwise specified. In accordance with cruise vacation industry practice, the term “berths” is determined based on double occupancy per cabin even though many cabins can accommodate three or more passengers. This Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2021.

This Quarterly Report on Form 10-Q also includes trademarks, trade names and service marks of other companies. Use or display by us of other parties’ trademarks, trade names or service marks is not intended to and does not imply a relationship with, or endorsement or sponsorship of us by, these other parties other than as described herein.

Note 1. General

Description of Business 

We are a global cruise company. We own and operate three global cruise brands: Royal Caribbean International, Celebrity Cruises and Silversea Cruises (collectively, our "Global Brands"). We also own a 50% joint venture interest in TUI Cruises GmbH ("TUIC"), which operates the German brands TUI Cruises and Hapag-Lloyd Cruises (collectively, our "Partner Brands"). We account for our investments in our Partner Brands under the equity method of accounting. Together, our Global Brands and our Partner Brands have a combined fleet of 62 ships as of March 31, 2022. Our ships offer a selection of worldwide itineraries that call on more than 1,000 destinations on all seven continents.

Management's Plan and Liquidity

During 2021, we restarted our global cruise operations in a phased manner, following our voluntary suspension of global cruise operations that commenced in March of 2020 in response to the COVID-19 pandemic. Since then, we have steadily increased the number of ships that have returned to service. As of March 31, 2022, we returned to service 54 of our Global and Partner Brand ships, representing close to 90% of our worldwide capacity. Our return to service efforts incorporate our enhanced health and safety protocols, and the requirements of regulatory agencies, which has resulted in reduced guest occupancy, modified itineraries and vaccination protocols.

Uncertainties remain as to the continuing effects COVID-19 will have on our operations, including potential increases in infection rates, new variants, and renewed governmental action to slow the spread of COVID-19, which may lead us to cancel or modify certain of our Global Brands’ cruise sailings. Additionally, there is uncertainty surrounding consumer behavior and demand for cruising. The continuing effects of COVID-19 to our guest cruise operations and the increased uncertainty given the current war in Ukraine, including its effect on the price of fuel and food, are collectively having a material negative impact on our business, including our liquidity, financial position and results of operations.

Significant events affecting travel, including COVID-19, typically impact the booking pattern for cruise vacations, with the full extent of the impact generally determined by the length of time the event influences travel decisions. The estimation of our future liquidity requirements include numerous assumptions that are subject to various risks and uncertainties. The principal assumptions used to estimate our future liquidity requirements consist of:

•Expected continued resumption of cruise operations and timing of cash collections for cruise bookings;

•Expected increase in revenue per available passenger cruise day during our continued resumption of cruise operations;

•Expected lower than comparable historical occupancy levels during our continued resumption of cruise operations, increasing over time until we reach historical occupancy levels; and

•Expected spend during our continued resumption of cruise operations, including returning our crew members to our vessels and maintaining enhanced health and safety protocols.

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There can be no assurance that our assumptions and estimates are accurate due to the uncertainties noted above. Since the start of the pandemic, we have implemented a number of proactive measures to mitigate the financial and operational impacts of COVID-19, including reduction of capital expenditures and operating expenses, the issuance of debt and shares of our common stock, the amendment of credit agreements to defer payments, the waiver and/or modification of covenant requirements and the suspension of dividend payments. Additionally, we expect to continue to pursue refinancing opportunities to reduce interest expense and extend maturities.

As of March 31, 2022, we had liquidity of $3.8 billion, including $1.1 billion of undrawn revolving credit facility capacity, $2.0 billion in cash and cash equivalents, and a $0.7 billion commitment for a 364-day term loan facility available to draw on at any time prior to August 12, 2022. Our revolving credit facilities were partially utilized through a combination of amounts drawn and letters of credit issued under the facilities as of March 31, 2022.

As of March 31, 2022, we were in compliance with our financial covenants and we estimate we will be in compliance for the next twelve months. Refer to Note 6. Debt for further information regarding the amendments made to our debt facilities and credit card processing agreements, including related covenants.

Based on our assumptions regarding the impact of COVID-19 and our resumption of operations, as well as our present financial condition, we believe that we have sufficient financial resources to fund our obligations for at least the next twelve months from the issuance of these financial statements.

Beyond the next 12 months, in June of 2023, approximately $3.2 billion of long- term debt will become due. Accordingly, in addition to our $3.8 billion liquidity as of March 31 2022, in February 2022 we entered into certain agreements with Morgan Stanley & Co., LLC (“MS”) where MS agreed to provide backstop committed financing to refinance, repurchase and/or repay in whole or in part our existing and outstanding 10.875% Senior Secured Notes due 2023, 9.125% Senior Priority Guaranteed Notes due 2023 (the "Priority Guaranteed Notes"), and 4.25% Convertible Notes due 2023. Pursuant to the agreements, we may, at our sole option, issue and sell to MS (subject to the satisfaction of certain conditions) five-year senior unsecured notes with gross proceeds of up to $3.15 billion at any time between April 1, 2023 and June 29, 2023, to refinance the aforementioned notes.

If the Company is unable to maintain the required minimum level of liquidity or negotiate its minimum liquidity requirements, it could have a significant adverse effect on the Company’s business, financial condition and operating results.

Basis for Preparation of Consolidated Financial Statements

The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any items discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such Securities and Exchange Commission rules and regulations. Estimates are required for the preparation of financial statements in accordance with these principles. Actual results could differ from these estimates. Refer to Note 2. Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of our significant accounting policies.

All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50%, and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 5. Other Assets for further information regarding our variable interest entities. For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50%, the investment is accounted for using the equity method.

Effective March 19, 2021, we sold our wholly-owned brand, Azamara Cruises ("Azamara"), including its three-ship fleet and associated intellectual property, to Sycamore Partners for $201 million, subject to closing adjustments. The March 2021 sale of Azamara did not represent a strategic shift that will have a major effect on our operations and financial results, as we continue to provide similar itineraries to and source passengers from the markets served by the Azamara business. Therefore, the sale of Azamara did not meet the criteria for discontinued operations reporting. Effective March 19, 2021, we no longer consolidate Azamara's balance sheet nor recognize its results of operations in our consolidated financial statements. We recognized an immaterial gain on the sale during the quarter ended March 31, 2021 and have agreed to provide certain transition services to Azamara for a period of time for a fee.

Prior to October 1, 2021, we consolidated the operating results of Silversea Cruises on a three-month reporting lag to allow for more timely preparation of our consolidated financial statements. Effective October 1, 2021, we eliminated the three-

7

month reporting lag to reflect Silversea Cruises' financial position, results of operations and cash flows concurrently and consistently with the fiscal calendar of the Company ("elimination of the Silversea reporting lag"). The elimination of the Silversea reporting lag represents a change in accounting principle which we believe to be preferable because it provides more current information to the users of our financial statements. A change in accounting principle requires retrospective application, if material. The impact of the elimination of the reporting lag was immaterial to prior periods and was immaterial for our fiscal year ended December 31, 2021. As a result, we have accounted for this change in accounting principle in our consolidated results for the quarter and year ended December 31, 2021. Accordingly, the results of Silversea Cruises from January 1, 2022 through March 31, 2022 are included in our consolidated statement of comprehensive loss for the quarter ended March 31, 2022 and the results of Silversea Cruises from October 1, 2020 through December 31, 2020 are included in our consolidated statement of comprehensive loss for the quarter ended March 31, 2021.

Note 2. Summary of Significant Accounting Policies

Adoption of Accounting Pronouncements

In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) ("ASU 2020-06"), which simplifies the accounting for convertible instruments. The guidance removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments, requiring bifurcation only if the convertible debt feature qualifies as a derivative under ASC 815 or for convertible debt issued at a substantial premium. The ASU removes certain settlement conditions required for equity contracts to qualify for the derivative scope exception, permitting more contracts to qualify for it. In addition, the guidance eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. The guidance also decreases interest expense due to the reversal of the remaining non-cash convertible debt discount. On January 1, 2022, we adopted this pronouncement using the modified retrospective approach to recognize our convertible notes as single liability instruments given they do not qualify as derivatives under ASC 815, nor were they issued at a substantial premium. Accordingly, as of January 1, 2022, we recorded a $161.4 million increase to debt, primarily as a result of the reversal of the remaining non-cash convertible debt discount, as well as a reduction of $307.6 million to additional paid in capital, which resulted in a cumulative effect on adoption of approximately $146.2 million to increase retained earnings.

Recent Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB") issued Accounting Standard Update (“ASU") No. 2020-04, Reference Rate Reform (Topic 848), which provides optional expedients and exceptions to the current guidance on contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. Subsequently, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848), which presents amendments to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance in both ASUs was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. We are currently evaluating the impact of the new guidance on our consolidated financial statements. The impact, if any, will be dependent on the terms of any future contract modifications related to a change in reference rate.

Note 3. Revenues

Revenue Recognition

Revenues are measured based on consideration specified in our contracts with customers and are recognized as the related performance obligations are satisfied.

The majority of our revenues are derived from passenger cruise contracts which are reported within Passenger ticket revenues in our consolidated statements of comprehensive loss. Our performance obligation under these contracts is to provide a cruise vacation in exchange for the ticket price. We satisfy this performance obligation and recognize revenue over the duration of each cruise, which generally range from two to 25 nights.

Passenger ticket revenues include charges to our guests for port costs that vary with passenger head counts. These type of port costs, along with port costs that do not vary by passenger head counts, are included in our cruise operating expenses. The

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amounts of port costs charged to our guests and included within Passenger ticket revenues on a gross basis were $76.9 million and $1.5 million for the quarters ended March 31, 2022 and 2021, respectively.

Our total revenues also include Onboard and other revenues, which consist primarily of revenues from the sale of goods and services onboard our ships that are not included in passenger ticket prices. We receive payment before or concurrently with the transfer of these goods and services to passengers during a cruise and recognize revenue over the duration of the related cruise.

As a practical expedient, we have omitted disclosures on our remaining performance obligations as the duration of our contracts with customers is less than a year.

Disaggregated Revenues

The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands):

	Quarter Ended March 31,
	2022		2021
Revenues by itinerary
North America (1)	$	889,087	$	—
Asia/Pacific	34,633		29,885
Europe	1,425		—
Other regions(2)	79,633		810
Total revenues by itinerary	1,004,778		30,695
Other revenues(3)	54,453		11,319
Total revenues	$	1,059,231	$	42,014

(1)Includes the United States, Canada, Mexico and the Caribbean.

(2) Includes seasonality impacted itineraries primarily in South and Latin American countries.

(3) Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 5. Other Assets for more information on our unconsolidated affiliates.

Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended March 31, 2022 and 2021, our guests were sourced from the following areas:

	Quarter Ended March 31,
	2022		2021
Passenger ticket revenues:
United States	84	%	—	%
Singapore	4	%	69	%
China	—	%	31	%
All other countries (1)	12	%	—	%

(1)No other individual country's revenue exceeded 10% for the quarters ended March 31, 2022 and 2021.

Customer Deposits and Contract Liabilities

Our payment terms generally require an upfront deposit to confirm a reservation, with the balance due prior to the cruise. Deposits received on sales of passenger cruises are initially recorded as Customer deposits in our consolidated balance sheets and subsequently recognized as passenger ticket revenues during the duration of the cruise. ASC 606, Revenues from Contracts with Customers, defines a “contract liability” as an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. We do not consider customer deposits to be a contract liability until the customer no longer retains the unilateral right, resulting from the passage of time, to cancel such customer's reservation and receive a full refund. Customer deposits presented in our consolidated balance sheets include contract liabilities of $1.2 billion and $0.8 billion as of March 31, 2022 and December 31, 2021, respectively.

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The COVID-19 pandemic has impacted the predictability of bookings and the associated customer deposits received. During the onset of the COVID-19 pandemic and subsequent emergence of related variants, we experienced significant cancellations, which led to the issuance of cash refunds to customers or credits for future cruises. As of March 31, 2022, refunds due to customers were $35.2 million compared to $38.8 million as of December 31, 2021, and are included within Accounts payable in our consolidated balance sheets.

We have provided flexibility to guests with bookings on sailings cancelled due to COVID-19 by allowing guests to receive future cruise credits (“FCC”) or elect to receive refunds in cash. As of March 31, 2022, our customer deposit balance includes approximately $0.6 billion of unredeemed FCCs. As of March 31, 2022, the expiration date of the FCCs was extended through December 31, 2022, or one year from the original sailing date, whichever is later. Given the uncertainty of travel demand caused by COVID-19 and lack of comparable historical experience of FCC redemptions, we are unable to estimate the number of FCCs that may expire unused in future periods and get recognized as breakage. We will update our breakage analysis as future information is received.

Contract Receivables and Contract Assets

Although we generally require full payment from our customers prior to their cruise, we grant credit terms to a relatively small portion of our revenue sourced in select markets outside of the United States. As a result, we have outstanding receivables from passenger cruise contracts in those markets. We also have receivables from credit card merchants for cruise ticket purchases and goods and services sold to guests during cruises that are collected before, during or shortly after the cruise voyage. In addition, we have receivables due from concessionaires onboard our vessels. These receivables are included within Trade and other receivables, net in our consolidated balance sheets.

We have contract assets that are conditional rights to consideration for satisfying the construction services performance obligations under a service concession arrangement. As of March 31, 2022 and December 31, 2021, our contract assets were $95.4 million and $52.9 million, respectively, and were included within Other assets in our consolidated balance sheets. Given the short duration of our cruises and our collection terms, we do not have any other significant contract assets.

Assets Recognized from the Costs to Obtain a Contract with a Customer

Prepaid travel advisor commissions are an incremental cost of obtaining contracts with customers that we recognize as an asset and include within Prepaid expenses and other assets in our consolidated balance sheets. Prepaid travel advisor commissions were $94.7 million as of March 31, 2022 and $75.4 million as of December 31, 2021. Substantially all of our prepaid travel advisor commissions at December 31, 2021 were expensed and reported primarily within Commissions, transportation and other in our consolidated statements of comprehensive loss for the quarter ended March 31, 2022.

Note 4. (Loss) Per Share

Basic and diluted (loss) per share is as follows (in thousands, except per share data):

	Quarter Ended March 31,
	2022		2021
Net (Loss) for basic and diluted loss per share	$	(1,167,142)	$	(1,131,722)
Weighted-average common shares outstanding	254,821		243,004
Diluted weighted-average shares outstanding	254,821		243,004
Basic (loss) per share	$	(4.58)	$	(4.66)
Diluted (loss) per share	$	(4.58)	$	(4.66)

Basic loss per share is computed by dividing Net Loss by the weighted-average number of common stock outstanding during each period. Diluted loss per share incorporates the incremental shares issuable upon the assumed exercise of stock options and conversion of potentially dilutive securities. As we had net losses for the three months ended March 31, 2022 and March 31, 2021, all potential common shares were determined to be antidilutive, resulting in the same basic and diluted net loss per share amounts for both these periods. There were approximately 23,407,179 and 413,501 antidilutive shares for the quarters ended March 31, 2022 and March 31, 2021, respectively.

Effective January 1, 2022, ASU 2020-06 eliminated the treasury stock method and instead required the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share when the instruments may be settled in cash or shares. Under the if-converted method, shares related to our convertible notes, to the extent dilutive, are assumed to be converted into common stock at the beginning of the reporting period. The required use of the if-converted

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method did not impact our diluted net loss per share as the Company was in a net loss position. For further information regarding the adoption of ASU 2020-06, refer to Note 2. Summary of Significant Accounting Policies.

Note 5. Other Assets

A Variable Interest Entity (“VIE”) is an entity in which the equity investors have not provided enough equity to finance the entity’s activities or the equity investors: (1) cannot directly or indirectly make decisions about the entity’s activities through their voting rights or similar rights; (2) do not have the obligation to absorb the expected losses of the entity; (3) do not have the right to receive the expected residual returns of the entity; or (4) have voting rights that are not proportionate to their economic interests and the entity’s activities involve or are conducted on behalf of an investor with a disproportionately small voting interest.

We have determined that TUI Cruises GmbH ("TUIC"), our 50%-owned joint venture, which operates the brands TUI Cruises and Hapag-Lloyd Cruises, is a VIE. We have determined that we are not the primary beneficiary of TUIC. We believe that the power to direct the activities that most significantly impact TUIC’s economic performance is shared between ourselves and TUI AG, our joint venture partner. All the significant operating and financial decisions of TUIC require the consent of both parties, which we believe creates shared power over TUIC. Accordingly, we do not consolidate this entity and account for this investment under the equity method of accounting.

As of March 31, 2022, the net book value of our investment in TUIC was $404.0 million, primarily consisting of $286.2 million in equity and a loan of €99.1 million, or approximately $110.2 million based on the exchange rate at March 31, 2022. As of December 31, 2021, the net book value of our investment in TUIC was $444.4 million, primarily consisting of $322.4 million in equity and a loan of €103.0 million, or approximately $117.2 million based on the exchange rate at December 31, 2021. The loan, which was made in connection with the sale of Splendour of the Seas in April 2016, accrues interest at a rate of 6.25% per annum and is payable over 10 years. This loan is 50% guaranteed by TUI AG and is secured by a first priority mortgage on the ship. The majority of these amounts were included within Other assets in our consolidated balance sheets. During the quarter ended March 31, 2021, we and TUI AG each contributed €59.5 million, or approximately $69.9 million based on the exchange rate at March 31, 2021, of additional equity through a combination of cash contributions and conversion of existing receivables.

TUIC has various ship construction and financing agreements which include certain restrictions on each of our and TUI AG’s ability to reduce our current ownership interest in TUI Cruises below 37.55% through May 2033. Our investment amount and outstanding term loan are substantially our maximum exposure to loss in connection with our investment in TUIC.

We have determined that Grand Bahama Shipyard Ltd. ("Grand Bahama"), a ship repair and maintenance facility in which we have a 40% noncontrolling interest, is a VIE. This facility serves cruise and cargo ships, oil and gas tankers and offshore units. We utilize this facility, among other ship repair facilities, for our regularly scheduled drydocks and certain emergency repairs as may be required. During the quarter ended March 31, 2022, we made payments of $3.7 million to Grand Bahama for ship repair and maintenance services. We have determined that we are not the primary beneficiary of this facility as we do not have the power to direct the activities that most significantly impact the facility’s economic performance. Accordingly, we do not consolidate this entity.

As of March 31, 2022, we had exposure to credit loss in Grand Bahama consisting of a $10.6 million loan. Our loan to Grand Bahama matures March 2026 and bears interest at LIBOR plus 3.5% to 3.75%, capped at 5.75%. Interest payable on the loan is due on a semi-annual basis. During the quarter ended March 31, 2021, we received principal and interest payments of $8.9 million related to a term loan that had fully matured. We did not receive principal and interest payments during the quarter ended March 31, 2022. The outstanding loan balance is in non-accrual status and is included within Trade and other receivables, net and Other assets in our consolidated balance sheets. In addition, we are currently recognizing our share of net accumulated equity method losses against the carrying value of our loan receivable from Grand Bahama. We monitor credit risk associated with the loan through our participation on Grand Bahama’s board of directors along with our review of Grand Bahama’s financial statements and projected cash flows. 

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The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands):

	Quarter Ended March 31,
	2022		2021
Share of equity (loss) income from investments	$	(31,059)	$	(59,871)
Dividends received (1)	$	423	$	—

(1) Represents dividends received from our investments accounted for under the equity method of accounting for the quarters ended March 31, 2022 and March 31, 2021.

	As of March 31, 2022		As of December 31, 2021
Total notes receivable due from equity investments	$	123,157	$	130,587
Less-current portion (1)	21,069		21,508
Long-term portion (2)	$	102,088	$	109,079

(1)Included within Trade and other receivables, net in our consolidated balance sheets.

(2)Included within Other assets in our consolidated balance sheets.

We also provide ship management services to TUIC and recorded the following as it relates to these services in our operating results within our consolidated statements of comprehensive income (loss) (in thousands):

	Quarter Ended March 31,
	2022		2021
Revenues	$	6,372	$	5,231
Expenses	$	1,826	$	1,275

Credit Losses

We reviewed our notes receivable for credit losses in connection with the preparation of our financial statements for the quarter ended March 31, 2022. In evaluating the allowance, management considered factors such as historical loss experience, the types of loans and the amount of loans in the loan portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, peer group information and prevailing economic conditions. Based on these credit loss estimation factors, during the quarter ended March 31, 2022, we recorded a loss provision of $0.7 million. Our credit loss allowance beginning and ending balances as of January 1, 2022 and March 31, 2022 primarily relate to credit losses recognized on notes receivable for the previous sale of our property and equipment of $81.6 million and other receivable balances primarily related to loans due from travel advisors of $12.6 million.

The following table summarizes our credit loss allowance related to receivables for the three months ended March 31, 2022 (in thousands):

	Credit Loss Allowance
Beginning balance January 1, 2022	$	100,192
Loss provision for receivables	653
Write-offs	(8,152)
Ending balance March 31, 2022	$	92,693

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Note 6. Debt

Debt consist of the following (in thousands):

	Interest Rate (1)	Maturities Through	As of March 31, 2022		As of December 31, 2021
Fixed rate debt:
Unsecured senior notes	3.70% to 9.13%	2022 - 2028	$	6,598,558	$	5,604,498
Secured senior notes	10.88% to 11.50%	2023 - 2025	2,357,803		2,354,037
Unsecured term loans	2.53% to 5.89%	2028 - 2034	4,114,508		2,860,567
Convertible notes	2.88% to 4.25%	2023	1,725,000		1,558,780
Total fixed rate debt			14,795,869		12,377,882
Variable rate debt:
Unsecured revolving credit facilities (2)	1.75% to 2.15%	2022 - 2024	1,909,342		2,899,342
USD unsecured term loan	1.84% to 4.95%	2022 - 2033	5,114,768		5,018,740
Euro unsecured term loan	1.15% to 2.25%	2022 - 2028	670,500		685,633
Total variable rate debt			7,694,610		8,603,715
Finance lease liabilities			428,387		472,275
Total debt (3)			22,918,866		21,453,872
Less: unamortized debt issuance costs			(416,890)		(363,532)
Total debt, net of unamortized debt issuance costs			22,501,976		21,090,340
Less—current portion			(2,558,463)		(2,243,131)
Long-term portion			$	19,943,513	$	18,847,209

(1) Interest rates based on outstanding loan balance as of March 31, 2022 and, for variable rate debt, include either LIBOR or EURIBOR plus the applicable margin.

(2) Includes $1.9 billion facility and $1.3 billion facility, the vast majority of which is due in 2024. Our $1.9 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.30%, which interest was 1.75% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.20%. Our $1.3 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.70%, which interest was 2.15% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.30%.

(3) At March 31, 2022 and December 31, 2021, the weighted average interest rate for total debt was 5.61% and 5.47%, respectively.

In January 2022, we took delivery of Wonder of the Seas. To finance the delivery, we borrowed a total of $1.3 billion under a credit agreement novated to us upon delivery of the ship in January 2022, resulting in an unsecured term loan which is 100% guaranteed by Bpifrance Assurance Export ("BpiFAE"), the official export credit agency ("ECA") of France. The unsecured loan amortizes semi-annually over 12 years and bears interest at a fixed rate of 3.18% per annum.

In January 2022, we issued $1.0 billion of senior notes (the "January 2022 Unsecured Notes") due in 2027 for net proceeds of approximately $990.0 million. Interest accrues on the January 2022 Unsecured Notes at a fixed rate of 5.375% per annum and is payable semi-annually in arrears. The proceeds from the January 2022 Unsecured Notes will be used to repay principal payments on debt maturing in 2022 (including to pay fees and expenses in connection with such repayments). Pending such debt maturities, we have temporarily applied the proceeds to repay borrowings under our revolving credit facilities, bringing our undrawn revolving credit facility capacity to $1.1 billion as of March 31, 2022.

In February 2022, we entered into certain agreements with MS where MS agreed to provide backstop committed financing to refinance, repurchase and/or repay in whole or in part our existing and outstanding 10.875% Senior Secured Notes due 2023, Priority Guaranteed Notes and 4.25% Convertible Notes due 2023. Pursuant to the agreements, we may, at our sole option, issue and sell to MS (subject to the satisfaction of certain conditions) five-year senior unsecured notes with gross proceeds of up to $3.15 billion at any time between April 1, 2023 and June 29, 2023, to refinance the aforementioned notes.

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In April 2022, we took delivery of Celebrity Beyond. To finance the delivery, we borrowed a total of €0.7 billion under a credit agreement novated to us upon delivery of the ship in April 2022, resulting in an unsecured term loan which is 100% guaranteed by BpiFAE. The unsecured loan amortizes semi-annually over 12 years and bears interest at a fixed rate of 1.28% per annum.

As of March 31, 2022, our aggregate revolving borrowing capacity was $3.2 billion and was partially utilized through a combination of amounts drawn and letters of credits issued under the facilities. Certain of our surety agreements with third party providers for the benefit of certain agencies and associations that provide travel related bonds, allow the sureties to request collateral. We also have agreements with our credit card processors relating to customer deposits received by us for future voyages. These agreements allow the credit card processors to require us, under certain circumstances, to maintain a reserve that can be satisfied by posting collateral. As of March 31, 2022, we have posted letters of credit as collateral with our sureties and credit card processors under our revolving credit facilities in the amount of $117.2 million

Executed amendments are in place for the majority of our credit card processors, waiving reserve requirements tied to the breach of our financial covenants through at least September 30, 2022, with modified covenants thereafter, and as such, we do not anticipate any incremental collateral requirements for the processors covered by these waivers in the next 12 months. We have a reserve with a processor where the agreement was amended in the first quarter of 2021, such that proceeds are withheld in reserve, until the sailing takes place or the funds are refunded to the customer. The maximum projected exposure with the processor, including amounts currently withheld and reported in Trade and other receivables, is approximately $293.9 million. The amount and timing are dependent on future factors that are uncertain, such as the date we return to operations, volume and value of future deposits and whether we transfer our business to other processors. If we require additional waivers on the credit card processing agreements and are not able to obtain them, this could lead to the termination of these agreements or the trigger of reserve requirements.

Except for the term loans we incurred to acquire Celebrity Flora and Silver Moon, all of our unsecured ship financing term loans are guaranteed by the export credit agency in the respective country in which the ship is constructed. For the majority of the loans as of March 31, 2022, we pay to the applicable export credit agency, depending on the financing agreement, an upfront fee of 2.35% to 5.48% of the maximum loan amount in consideration for these guarantees. We amortize the fees that are paid upfront over the life of the loan. We classify these fees within Amortization of debt issuance costs in our consolidated statements of cash flows. Prior to the loan being drawn, we present these fees within Other assets in our consolidated balance sheets. Once the loan is drawn, such fees are classified as a discount to the related loan, or contra-liability account, within Current portion of long-term debt or long-term debt.

The following is a schedule of annual maturities on our total debt, net of debt issuance costs and including finance leases, as of March 31, 2022 for each of the next five years (in thousands):

Year
Remainder of 2022	2,273,401
2023	5,665,482
2024	3,128,924
2025	2,417,492
2026	2,614,571
Thereafter	6,402,106
	22,501,976

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Note 7. Leases

Operating Leases

Our operating leases primarily relate to preferred berthing arrangements, real estate and shipboard equipment, and are included within Operating lease right-of-use assets, and Long-term operating lease liabilities with the current portion of the liability included within Current portion of operating lease liabilities in our consolidated balance sheets as of March 31, 2022 and December 31, 2021. Leases with an initial term of 12 months or less are not recorded on our consolidated balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. Our operating leases include Silver Explorer, operated by Silversea Cruises. The operating lease for Silver Explorer will expire in 2023.

For some of our real estate leases and berthing agreements, we do have the option to extend our current lease term. For those lease agreements with renewal options, the renewal periods for real estate leases range from one to 10 years and the renewal periods for berthing agreements range from one to 20 years. Generally, we do not include renewal options as a component of our present value calculation for berthing agreements. However, for certain real estate leases, we include them.

As most of our leases do not provide an implicit rate, we use our incremental borrowing rate in determining the present value of lease payments. We estimate our incremental borrowing rates based on LIBOR and U.S. Treasury note rates corresponding to lease terms increased by the Company’s credit risk spread and reduced by the estimated impact of collateral. In addition, we have lease agreements with lease and non-lease components, which are generally accounted for separately. However, for berthing agreements, we account for the lease and non-lease components as a single lease component.

Finance Leases

In June 2019, the Company entered into a new master lease agreement (“Master Lease”) with Miami-Dade County related to the buildings and surrounding land located at its Miami headquarters, which has been classified as a finance lease in accordance with ASC 842, Leases. In January of 2022, we executed a modification to the Master Lease to extend the expiration of the lease from 2072 to 2074, which continues to include the two five-year options to extend the lease. We continue to consider the probability of exercising the two five-year options as reasonably certain. The modification of the Master Lease did not change the classification of the lease. The total aggregate amount of the finance lease liabilities recorded for this Master Lease are $100.3 million and $127.0 million as of March 31, 2022 and December 31, 2021, respectively.

Silversea Cruises operates Silver Dawn under a sale-leaseback agreement with a bargain purchase option at the end of the 15-year lease term. Due to the bargain purchase option at the end of the lease term in 2036, whereby Silversea Cruises is reasonably certain of obtaining ownership of the ship, Silver Dawn is accounted for as a finance lease. The lease includes other purchase options beginning in year three, none of which are reasonably certain of being exercised at this time. The total aggregate amount of finance lease liabilities recorded for this ship are $279.0 million and $283.7 million as of March 31, 2022 and December 31, 2021, respectively.

Silversea Cruises operates the Silver Whisper under a finance lease. The finance lease for Silver Whisper will expire in 2023, subject to an option to purchase the ship. Additionally, certain scheduled payments have been deferred and are reflected in Long-term debt in our Consolidated Balance Sheet as of March 31, 2022 and December 31, 2021. The total aggregate amount of the finance lease liabilities recorded for this ship was $16.6 million and $24.1 million at March 31, 2022 and December 31, 2021, respectively. The lease payments on the Silver Whisper are subject to adjustments based on the LIBOR rate.

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The carrying amounts of these ships are reported within Property and equipment, net in our Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021.

The components of lease expense were as follows (in thousands):

	Consolidated Statement of Comprehensive Loss Classification	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Lease costs:
Operating lease costs	Commission, transportation and other	$	22,729	$	—
Operating lease costs	Other operating expenses	5,471		5,130
Operating lease costs	Marketing, selling and administrative expenses	4,776		6,035
Financial lease costs:
Amortization of right-of-use-assets	Depreciation and amortization expenses	6,093		3,744
Interest on lease liabilities	Interest expense, net of interest capitalized	4,600		310
Total lease costs		$	43,669	$	15,219

In addition, certain of our berthing agreements include variable lease costs based on the number of passengers berthed. During the quarter ended March 31, 2022, we had $7.5 million variable lease costs recorded within Commission, transportation and other in our consolidated statement of comprehensive loss.

Weighted average of the remaining lease terms and weighted average discount rates are as follows:

	As of March 31, 2022		As of December 31, 2021
Weighted average of the remaining lease term in years
Operating leases	18.04		18.18
Finance leases	22.90		23.96
Weighted average discount rate
Operating leases	6.53	%	6.52	%
Finance leases	5.95	%	5.54	%

Supplemental cash flow information related to leases is as follows (in thousands):

	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	28,193	$	5,531
Operating cash flows from finance leases	$	4,600	$	310
Financing cash flows from finance leases	$	17,034	$	4,305

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As of March 31, 2022, maturities related to lease liabilities were as follows (in thousands):

Year	Operating Leases		Finance Leases
Remainder of 2022	$	79,074	$	49,240
2023	108,241		53,069
2024	89,214		44,348
2025	81,594		43,986
2026	75,519		38,843
Thereafter	825,818		704,535
Total lease payments	1,259,460		934,021
Less: Interest	(661,302)		(505,634)
Present value of lease liabilities	$	598,158	$	428,387

Note 8. Commitments and Contingencies

Ship Purchase Obligations

Our future capital commitments consist primarily of new ship orders. As of March 31, 2022, one Oasis-class ship and three ships of a new generation, known as our Icon-class, are on order for our Royal Caribbean International brand with an aggregate capacity of approximately 22,500 berths. As of March 31, 2022, we had two Edge-class ships on order for our Celebrity Cruises brand with an aggregate capacity of approximately 6,500 berths. Additionally, as of March 31, 2022, we have two ships on order for our Silversea Cruises brand with an aggregate capacity of approximately 1,460 berths.

COVID-19 has impacted shipyard operations which have and may continue to result in delays of our previously contracted ship deliveries. As of March 31, 2022, the dates that the ships on order by our Global and Partner Brands are expected to be delivered, subject to change in the event of construction delays, and their approximate berths are as follows:

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Ship	Shipyard	Expected to be delivered	Approximate Berths
Royal Caribbean International —
Oasis-class:
Utopia of the Seas	Chantiers de l'Atlantique	2nd Quarter 2024	5,700
Icon-class:
Icon of the Seas	Meyer Turku Oy	3rd Quarter 2023	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2025	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2026	5,600
Celebrity Cruises —
Edge-class:
Celebrity Beyond	Chantiers de l'Atlantique	2nd Quarter 2022	3,250
Celebrity Ascent	Chantiers de l'Atlantique	4th Quarter 2023	3,250
Silversea Cruises
Evolution Class:
Silver Nova	Meyer Werft	2nd Quarter 2023	730
Unnamed	Meyer Werft	2nd Quarter 2024	730
TUI Cruises (50% joint venture)
Mein Schiff 7	Meyer Turku Oy	2nd Quarter 2024	2,900
Unnamed	Fincantieri	4th Quarter 2024	4,100
Unnamed	Fincantieri	2nd Quarter 2026	4,100
Total Berths			41,560

We took delivery of Celebrity Beyond in April of 2022. In addition, as of March 31, 2022, we have an agreement in place with Chantiers de l'Atlantique to build an additional Edge-class ship for delivery in 2025, which is contingent upon completion of conditions precedent and financing.

As of March 31, 2022, the aggregate cost of our ships on order presented in the table above, excluding any ships on order by our Partner Brands, was approximately $10.7 billion, of which we had deposited $0.6 billion as of such date. Approximately 61.8% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at March 31, 2022. Refer to Note 11. Fair Value Measurements and Derivative Instruments for further information.

Litigation

As previously reported, two lawsuits were filed against us in August 2019 in the U.S. District Court for the Southern District of Florida (the "Court") under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act. The complaint filed by Havana Docks Corporation ("Havana Docks Action") alleges it holds an interest in the Havana Cruise Port Terminal, and the complaint filed by Javier Garcia-Bengochea (the "Port of Santiago Action") alleges that he holds an interest in the Port of Santiago, Cuba, both of which were expropriated by the Cuban government. The complaints further allege that we trafficked in those properties by embarking and disembarking passengers at these facilities. The plaintiffs seek all available statutory remedies, including the value of the expropriated property, plus interest, treble damages, attorneys’ fees and costs. The Court dismissed the Port of Santiago Action with prejudice on the basis that the plaintiff lacked standing, and the plaintiff’s appeal of the dismissal is awaiting a decision by the appellate court. In the Havana Docks Action, on March 21, 2022, the Court granted summary judgement in favor of the plaintiff as to liability, which we have sought permission from the Court to immediately appeal, and a trial on damages has been scheduled for September 2022. We believe we have meritorious defenses to the claims alleged in both the Havana Docks Action and the Port of Santiago Action, and we intend to vigorously defend ourselves against them. Given that the outcome of the litigation is inherently unpredictable and subject to significant uncertainties, there can be no assurances that the final outcome of either case will not be material, and we cannot reasonably estimate the potential loss or range of loss, if any, associated with the litigation.

We are routinely involved in claims typical within the cruise vacation industry. The majority of these claims are covered by insurance. We believe the outcome of such claims, net of expected insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows.

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Other

Some of the contracts that we enter into include indemnification provisions that obligate us to make payments to the counterparty if certain events occur. These contingencies generally relate to changes in taxes, increased lender capital costs and other similar costs. The indemnification clauses are often standard contractual terms and are entered into in the normal course of business. There are no stated or notional amounts included in the indemnification clauses and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have not been required to make any payments under such indemnification clauses in the past and, under current circumstances, we do not believe an indemnification in any material amount is probable.

If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms. Our debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade. If this were to occur, it would have an adverse impact on our liquidity and operations.

Note 9. Shareholders' Equity

On January 1, 2022, we adopted ASU 2020-06 using the modified retrospective approach to recognize our convertible notes as single liability instruments. As a result of the adoption of this pronouncement, the cumulative effect to Shareholders' equity was a reduction of $161.4 million. For further information regarding the entry recorded and the adoption of ASU 2020-06, refer to Note 2. Summary of Significant Accounting Policies.

Common Stock Issued

During March 2021, we issued 16.9 million shares of common stock, par value $0.01 per share, at a price of $91.00 per share. We received net proceeds of $1.5 billion from the sale of our common stock, after deducting the estimated offering expenses payable by us.

Dividends

During the second quarter of 2020, we agreed with certain of our lenders not to pay dividends or engage in common stock repurchases for so long as our debt covenant waivers are in effect. In addition, in the event we declare a dividend or engage in share repurchases, we will need to repay the amounts deferred under our export credit facilities. Accordingly, during the three months ended March 31, 2021 and 2022, we did not declare dividends. Pursuant to amendments made to these agreements during the first quarter of 2021, the restrictions on paying cash dividends and effectuating share repurchases were extended through and including the third quarter of 2022.

19

Note 10. Changes in Accumulated Other Comprehensive Loss

The following table presents the changes in accumulated other comprehensive loss by component for the quarters ended March 31, 2022 and 2021 (in thousands):

	Accumulated Other Comprehensive Loss for the Quarter Ended March 31, 2022								Accumulated Other Comprehensive Loss for the Quarter Ended March 31, 2021
	Changes related to cash flow derivative hedges		Changes in defined benefit plans		Foreign currency translation adjustments		Accumulated  other comprehensive loss		Changes related to cash flow derivative hedges		Changes in defined benefit plans		Foreign currency translation adjustments		Accumulated  other comprehensive loss
Accumulated comprehensive loss at beginning of the year	$	(646,473)	$	(56,835)	$	(7,577)	$	(710,885)	$	(650,519)	$	(65,542)	$	(23,280)	$	(739,341)
Other comprehensive income (loss) before reclassifications	224,619		11,869		7,778		244,266		(927)		9,720		9,722		18,515
Amounts reclassified from accumulated other comprehensive loss	(28,718)		728		—		(27,990)		11,229		743		—		11,972
Net current-period other comprehensive income (loss)	195,901		12,597		7,778		216,276		10,302		10,463		9,722		30,487
Ending balance	$	(450,572)	$	(44,238)	$	201	$	(494,609)	$	(640,217)	$	(55,079)	$	(13,558)	$	(708,854)

The following table presents reclassifications out of accumulated other comprehensive loss for the quarters ended March 31, 2022 and 2021 (in thousands):

	Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
Details About Accumulated Other Comprehensive Loss Components	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021		Affected Line Item in Statements of Comprehensive Loss
Gain (loss) on cash flow derivative hedges:
Interest rate swaps	$	(10,434)	$	(9,509)	Interest expense, net of interest capitalized
Foreign currency forward contracts	(4,065)		(3,781)		Depreciation and amortization expenses
Foreign currency forward contracts	(1,218)		(1,291)		Other income (expense)
Fuel swaps	(369)		(407)		Other income (expense)
Fuel swaps	44,804		3,759		Fuel
	28,718		(11,229)
Amortization of defined benefit plans:
Actuarial loss	(728)		(743)		Payroll and related
	(728)		(743)
Total reclassifications for the period	$	27,990	$	(11,972)

20

Note 11. Fair Value Measurements and Derivative Instruments 

Fair Value Measurements

The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands): 

	Fair Value Measurements at March 31, 2022										Fair Value Measurements at December 31, 2021
Description	Total Carrying Amount		Total Fair Value		Level 1(1)		Level 2(2)		Level 3(3)		Total Carrying Amount		Total Fair Value		Level 1(1)		Level 2(2)		Level 3(3)
Assets:
Cash and cash equivalents(4)	$	1,968,504	$	1,968,504	$	1,968,504	$	—	$	—	$	2,701,770	$	2,701,770	$	2,701,770	$	—	$	—
Total Assets	$	1,968,504	$	1,968,504	$	1,968,504	$	—	$	—	$	2,701,770	$	2,701,770	$	2,701,770	$	—	$	—
Liabilities:
Long-term debt (including current portion of debt)(5)	$	22,073,589	$	23,323,063	$	—	$	23,323,063	$	—	$	20,618,065	$	22,376,480	$	—	$	22,376,480	$	—
Total Liabilities	$	22,073,589	$	23,323,063	$	—	$	23,323,063	$	—	$	20,618,065	$	22,376,480	$	—	$	22,376,480	$	—

(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

(2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company.

(3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of March 31, 2022 and December 31, 2021.

(4) Consists of cash and marketable securities with original maturities of less than 90 days.

(5) Consists of unsecured revolving credit facilities, senior notes, term loans and convertible notes. These amounts do not include our finance lease obligations or commercial paper.

Other Financial Instruments 

The carrying amounts of accounts receivable, accounts payable, accrued interest and accrued expenses approximate fair value at March 31, 2022 and December 31, 2021.

Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands):

	Fair Value Measurements at March 31, 2022								Fair Value Measurements at December 31, 2021
Description	Total		Level 1(1)		Level 2(2)		Level 3(3)		Total		Level 1(1)		Level 2(2)		Level 3(3)
Assets:
Derivative financial instruments(4)	$	241,254	$	—	$	241,254	$	—	$	69,808	$	—	$	69,808	$	—
Total Assets	$	241,254	$	—	$	241,254	$	—	$	69,808	$	—	$	69,808	$	—
Liabilities:
Derivative financial instruments(5)	$	117,708	$	—	$	117,708	$	—	$	200,541	$	—	$	200,541	$	—
Total Liabilities	$	117,708	$	—	$	117,708	$	—	$	200,541	$	—	$	200,541	$	—

(1)Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

(2)Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company.

(3)Inputs that are unobservable. No Level 3 inputs were used in fair value measurements of Other financial instruments as of March 31, 2022 and December 31, 2021.

(4)Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

(5) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

The reported fair values are based on a variety of factors and assumptions. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of March 31, 2022 or December 31, 2021, or that will be realized in the future, and do not include expenses that could be incurred in an actual sale or settlement.

Nonfinancial Instruments Recorded at Fair Value on a Nonrecurring Basis

Nonfinancial instruments include items such as goodwill, indefinite-lived intangible assets, long-lived assets, right-of-use assets and equity method investments that are measured at fair value on a nonrecurring basis when events and circumstances indicate the carrying value is not recoverable. The following table presents information about the Company’s nonfinancial instruments recorded at fair value on a nonrecurring basis (in thousands):

	Fair Value Measurements at December 31, 2021
Description	Total Carrying Amount	Total Fair Value	Level 3	Total Impairment for the Year Ended December 31, 2021 (1)
Long-lived assets	—	—	—	55,213
Total	—	—	—	55,213

(1) Amount is primarily composed of construction in progress assets that were impaired during the year ended 2021 due to a reduction in scope or the decision to not complete the projects. The impairments were calculated based on orderly liquidation values. The fair value of these assets was estimated as of the date the assets were last impaired.

There were no nonfinancial instruments recorded at fair value as of March 31, 2022.

Master Netting Agreements

We have master International Swaps and Derivatives Association (“ISDA”) agreements in place with our derivative instrument counterparties. These ISDA agreements generally provide for final close out netting with our counterparties for all positions in the case of default or termination of the ISDA agreement. We have determined that our ISDA agreements provide us with rights of setoff on the fair value of derivative instruments in a gain position and those in a loss position with the same counterparty. We have elected not to offset such derivative instrument fair values in our consolidated balance sheets.

See Credit Related Contingent Features for further discussion on contingent collateral requirements for our derivative instruments.

The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands):

	Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
	As of March 31, 2022								As of December 31, 2021
	Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Liabilities		Cash Collateral Received		Net Amount of Derivative Assets		Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Liabilities		Cash Collateral Received		Net Amount of Derivative Assets
Derivatives subject to master netting agreements	$	241,254	$	(68,784)	$	—	$	172,470	$	69,808	$	(67,995)	$	—	$	1,813
Total	$	241,254	$	(68,784)	$	—	$	172,470	$	69,808	$	(67,995)	$	—	$	1,813

The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands):

	Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
	As of March 31, 2022								As of December 31, 2021
	Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Assets		Cash Collateral Pledged		Net Amount of Derivative Liabilities		Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Assets		Cash Collateral Pledged		Net Amount of Derivative Liabilities
Derivatives subject to master netting agreements	$	(117,708)	$	68,784	$	16,668	$	(32,256)	$	(200,541)	$	67,995	$	44,411	$	(88,135)
Total	$	(117,708)	$	68,784	$	16,668	$	(32,256)	$	(200,541)	$	67,995	$	44,411	$	(88,135)

Concentrations of Credit Risk

We monitor our credit risk associated with financial and other institutions with which we conduct significant business, and to minimize these risks, we select counterparties with credit risks acceptable to us and we seek to limit our exposure to an individual counterparty. Credit risk, including, but not limited to, counterparty nonperformance under derivative instruments, our credit facilities and new ship progress payment guarantees, is not considered significant, as we primarily conduct business with large, well-established financial institutions, insurance companies and export credit agencies many of which we have long-term relationships with and which have credit risks acceptable to us or where the credit risk is spread out among a large number of counterparties. As of March 31, 2022, we had counterparty credit risk exposure under our derivative instruments of $157.7 million, which was limited to the cost of replacing the contracts in the event of non-performance by the counterparties to the contracts, the majority of which are currently our lending banks. We do not anticipate nonperformance by any of our significant counterparties. In addition, we have established guidelines we follow regarding credit ratings and instrument maturities to maintain safety and liquidity. We do not normally require collateral or other security to support credit relationships; however, in certain circumstances this option is available to us.

Derivative Instruments

We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We try to mitigate these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments pursuant to our hedging practices and policies. The financial impact of these hedging instruments is primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the notional amount, term and conditions of the derivative instrument with the underlying risk being hedged. Although certain of our derivative financial instruments do not qualify or are not accounted for under hedge accounting, our objective is not to hold or issue derivative financial instruments for trading or other speculative purposes. 

We enter into various forward, swap and option contracts to manage our interest rate exposure and to limit our exposure to fluctuations in foreign currency exchange rates and fuel prices. These instruments are recorded on the balance sheet at their fair value and

the vast majority are designated as hedges. We also use non-derivative financial instruments designated as hedges of our net investment in our foreign operations and investments.

At inception of the hedge relationship, a derivative instrument that hedges the exposure to changes in the fair value of a firm commitment or a recognized asset or liability is designated as a fair value hedge. A derivative instrument that hedges a forecasted transaction or the variability of cash flows related to a recognized asset or liability is designated as a cash flow hedge.

Changes in the fair value of derivatives that are designated as fair value hedges are offset against changes in the fair value of the underlying hedged assets, liabilities or firm commitments. Gains and losses on derivatives that are designated as cash flow hedges are recorded as a component of Accumulated other comprehensive loss until the underlying hedged transactions are recognized in earnings. The foreign currency transaction gain or loss of our non-derivative financial instruments and the changes in the fair value of derivatives designated as hedges of our net investment in foreign operations and investments are recognized as a component of Accumulated other comprehensive loss along with the associated foreign currency translation adjustment of the foreign operation or investment. In certain hedges of our net investment in foreign operations and investments, we exclude forward points from the assessment of hedge effectiveness and we amortize the related amounts directly into earnings.

On an ongoing basis, we assess whether derivatives used in hedging transactions are "highly effective" in offsetting changes in the fair value or cash flow of hedged items. For our net investment hedges, we use the dollar offset method to measure effectiveness. For all other hedging programs, we use the long-haul method to assess hedge effectiveness using regression analysis for each hedge relationship. The methodology for assessing hedge effectiveness is applied on a consistent basis for each one of our hedging programs (i.e., interest rate, foreign currency ship construction, foreign currency net investment and fuel). For our regression analyses, we use an observation period of up to three years, utilizing market data relevant to the hedge horizon of each hedge relationship. High effectiveness is achieved when a statistically valid relationship reflects a high degree of offset and correlation between the changes in the fair values of the derivative instrument and the hedged item. If it is determined that a derivative is not highly effective as a hedge or hedge accounting is discontinued, any change in fair value of the derivative since the last date at which it was determined to be effective is recognized in earnings.

Cash flows from derivative instruments that are designated as fair value or cash flow hedges are classified in the same category as the cash flows from the underlying hedged items. In the event that hedge accounting is discontinued, cash flows subsequent to the date of discontinuance are classified within investing activities. Cash flows from derivative instruments not designated as hedging instruments are classified as investing activities. 

We consider the classification of the underlying hedged item’s cash flows in determining the classification for the designated derivative instrument’s cash flows. We classify derivative instrument cash flows from hedges of benchmark interest rate or hedges of fuel expense as operating activities due to the nature of the hedged item. Likewise, we classify derivative instrument cash flows from hedges of foreign currency risk on our newbuild ship payments as investing activities.

Interest Rate Risk

Our exposure to market risk for changes in interest rates primarily relates to our debt obligations, including future interest payments. At March 31, 2022 and December 31, 2021, approximately 71.6% and 65.7%, respectively, of our debt was effectively fixed-rate debt. We use interest rate swap agreements to modify our exposure to interest rate movements and to manage our interest expense.

Market risk associated with our fixed-rate debt is the potential increase in fair value resulting from a decrease in interest rates. We use interest rate swap agreements that effectively convert a portion of our fixed-rate debt to a floating-rate basis to manage this risk. At March 31, 2022 and December 31, 2021, we maintained interest rate swap agreements on the following fixed-rate debt instruments:

Debt Instrument	Swap Notional as of March 31, 2022 (in thousands)		Maturity	Debt Fixed Rate	Swap Floating Rate: LIBOR plus	All-in Swap Floating Rate as of March 31, 2022
Unsecured senior notes	650,000		November 2022	5.25%	3.63%	4.14%
	$	650,000

These interest rate swap agreements are accounted for as fair value hedges.

Market risk associated with our long-term floating-rate debt is the potential increase in interest expense from an increase in interest rates. We use interest rate swap agreements that effectively convert a portion of our floating-rate debt to a fixed-rate basis to manage this risk. At March 31, 2022 and December 31, 2021, we maintained interest rate swap agreements on the following floating-rate debt instruments:

Debt Instrument	Swap Notional as of March 31, 2022 (in thousands)		Maturity	Debt Floating Rate		All-in Swap Fixed Rate
Celebrity Reflection term loan	$	163,625	October 2024	LIBOR plus	0.40%	2.85%
Quantum of the Seas term loan	306,250		October 2026	LIBOR plus	1.30%	3.74%
Anthem of the Seas term loan	332,292		April 2027	LIBOR plus	1.30%	3.86%
Ovation of the Seas term loan	449,583		April 2028	LIBOR plus	1.00%	3.16%
Harmony of the Seas term loan (1)	417,714		May 2028	EURIBOR plus	1.15%	2.26%
Odyssey of the Seas term loan (2)	421,667		October 2032	LIBOR plus	0.96%	3.21%
Odyssey of the Seas term loan (2)	191,667		October 2032	LIBOR plus	0.96%	2.84%
	$	2,282,798

(1)Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of March 31, 2022.

(2)Interest rate swap agreements hedging the term loan of Odyssey of the Seas include LIBOR zero-floors matching the debt LIBOR zero-floor. The effective dates of the $421.7 million and $191.7 million interest rate swap agreements are October 2020 and October 2022, respectively. The unsecured term loan for the financing of Odyssey of the Seas was drawn on March 2021.

These interest rate swap agreements are accounted for as cash flow hedges.

The notional amount of interest rate swap agreements related to outstanding debt as of March 31, 2022 and December 31, 2021 was $2.9 billion.

Foreign Currency Exchange Rate Risk

Derivative Instruments

Our primary exposure to foreign currency exchange rate risk relates to our ship construction contracts denominated in Euros, our foreign currency denominated debt and our international business operations. We enter into foreign currency forward contracts to manage portions of the exposure to movements in foreign currency exchange rates. As of March 31, 2022, the aggregate cost of our ships on order was $10.7 billion, of which we had deposited $618.5 million as of such date. These amounts do not include any ships placed on order that are contingent upon completion of conditions precedent and/or financing and any ships on order by our Partner Brands. Refer to Note 8. Commitments and Contingencies, for further information on our ships on order. At March 31, 2022 and December 31, 2021, approximately 61.8% and 59.0%, respectively, of the aggregate cost of the ships under construction was exposed to fluctuations in the Euro exchange rate. Our foreign currency forward contract agreements are accounted for as cash flow or net investment hedges depending on the designation of the related hedge.

On a regular basis, we enter into foreign currency forward contracts and, from time to time, we utilize cross-currency swap agreements and collar options to minimize the volatility resulting from the remeasurement of net monetary assets and liabilities denominated in a currency other than our functional currency or the functional currencies of our foreign subsidiaries. During the first quarter of 2022, we maintained an average of approximately $0.8 billion of these foreign currency forward contracts. These instruments are not designated as hedging instruments. For the quarters ended March 31, 2022 and 2021, changes in the fair value of the foreign currency forward contracts resulted in losses of $7.0 million and $13.5 million, respectively, which offset gains arising from the remeasurement of monetary assets and liabilities denominated in foreign currencies in those same periods of $7.2 million and $4.4 million, respectively. These amounts were recognized in earnings within Other income (expense) in our consolidated statements of comprehensive loss.

We consider our investments in our foreign operations to be denominated in relatively stable currencies and to be of a long-term nature. As of March 31, 2022, we maintained a foreign currency forward contract and designated it as a hedge of a portion of our net investments in TUI Cruises of €245.0 million, or approximately $272.5 million based on the exchange rate at March 31, 2022. This forward currency contract matured in April 2022.

The notional amount of outstanding foreign exchange contracts, excluding the forward contracts entered into to minimize remeasurement volatility, as of March 31, 2022 and December 31, 2021 was $2.8 billion and $3.4 billion, respectively.

Non-Derivative Instruments

We also address the exposure of our investments in foreign operations by denominating a portion of our debt in our subsidiaries’ and investments’ functional currencies and designating it as a hedge of these subsidiaries and investments. We had designated debt as a hedge of our net investments primarily in TUI Cruises of €99.0 million, or approximately $110.1 million, as of March 31, 2022. As of

December 31, 2021, we had designated debt as a hedge of our net investments in TUI Cruises of €97.0 million, or approximately $110.3 million.

Fuel Price Risk

Our exposure to market risk for changes in fuel prices relates primarily to the consumption of fuel on our ships. We use fuel swap agreements to mitigate the financial impact of fluctuations in fuel prices.

Our fuel swap agreements are generally accounted for as cash flow hedges. In the case that our hedged forecasted fuel consumption is not probable of occurring, hedge accounting will be discontinued and the related accumulated other comprehensive gain or loss will be reclassified to Other income (expense) immediately. For hedged forecasted fuel consumption that remains possible of occurring, hedge accounting will be discontinued and the related accumulated other comprehensive gain or loss will remain in accumulated other comprehensive gain or loss until the underlying hedged transactions are recognized in earnings or the related hedged forecasted fuel consumption is deemed probable of not occurring.

Prior suspension of our cruise operations due to the COVID-19 pandemic and our gradual resumption of cruise operations has resulted in reductions to our forecasted fuel purchases. During the quarter ended March 31, 2021, we discontinued cash flow hedge accounting on 48 thousand metric tons of our fuel swap agreements maturing in 2021, which resulted in the reclassification of a net $4.4 million loss from Accumulated other comprehensive loss to Other income (expense). For the quarter ended March 31, 2022, we did not discontinue cash flow hedge accounting on any of our fuel swap agreements. Changes in the fair value of fuel swaps for which cash flow hedge accounting was discontinued are currently recognized in Other income (expense) each reporting period through the maturity dates of the fuel swaps.

Future suspension of our operations or modifications to our itineraries may affect our expected forecasted fuel purchases which could result in further discontinuance of fuel swap cash flow hedge accounting and the reclassification of deferred gains or losses from Accumulated other comprehensive loss into earnings. Refer to Risk Factors in Part II, Item 1A. for further discussion on risks related to COVID-19.

At March 31, 2022, we have hedged the variability in future cash flows for certain forecasted fuel transactions occurring through 2023. As of March 31, 2022 and December 31, 2021, we had the following outstanding fuel swap agreements:

	Fuel Swap Agreements
	As of March 31, 2022	As of December 31, 2021
Designated as hedges:	(metric tons)
2022	660,650	821,850
2023	249,050	249,050

	Fuel Swap Agreements
	As of March 31, 2022		As of December 31, 2021
	(% hedged)
Designated hedges as a % of projected fuel purchases:
2022	55	%	54	%
2023	15	%	15	%

	Fuel Swap Agreements
	As of March 31, 2021	As of December 31, 2021
Not designated as hedges:	(metric tons)
2022(1)	139,100	231,900
2023	—	—

(1)    As of March 31, 2022, 69,550 metric tons relate to fuel swap agreements with discontinued hedge accounting, in which we effectively pay fixed prices and receive floating prices from the counterparty. The remaining 69,550 tons relate to fuel swap agreements that were not designated as hedges since inception, in which we effectively pay floating prices and receive fixed prices from the counterparty.

As of March 31, 2022, there was $145.6 million of estimated unrealized gain associated with our cash flow hedges pertaining to fuel swap agreements is expected to be reclassified to earnings from Accumulated other comprehensive loss within the next twelve months when compared to $23.8 million of estimated unrealized net gain at December 31, 2021. Reclassification is expected to occur as the result of fuel consumption associated with our hedged forecasted fuel purchases.

The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands):

	Fair Value of Derivative Instruments
	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	As of March 31, 2022		As of December 31, 2021		Balance Sheet Location	As of March 31, 2022		As of December 31, 2021
		Fair Value		Fair Value			Fair Value		Fair Value
Derivatives designated as hedging instruments under ASC 815-20(1)
Interest rate swaps	Other assets	$	23,791	$	—	Other long-term liabilities	$	1,072	$	62,080
Interest rate-swaps	Derivative financial instruments	741		6,478		Derivative financial instruments	—		—
Foreign currency forward contracts	Derivative financial instruments	15,133		7,357		Derivative financial instruments	84,872		116,027
Foreign currency forward contracts	Other assets	3,932		2,070		Other long-term liabilities	15,082		8,813
Fuel swaps	Derivative financial instruments	145,456		31,919		Derivative financial instruments	—		7,944
Fuel swaps	Other assets	35,370		13,452		Other long-term liabilities	—		1,202
Total derivatives designated as hedging instruments under 815-20		$	224,423	$	61,276		$	101,026	$	196,066
Derivatives not designated as hedging instruments under ASC 815-20
Foreign currency forward contracts	Derivative financial instruments	$	—	$	—	Derivative financial instruments	$	—	$	—
Foreign currency forward contracts	Other assets	—		—		Other long-term liabilities	—		—
Fuel swaps	Derivative financial instruments	16,831		8,430		Derivative financial instruments	16,682		3,264
Fuel swaps	Other Assets	—		102		Other long-term liabilities	—		1,211
Total derivatives not designated as hedging instruments under 815-20		16,831		8,532			16,682		4,475
Total derivatives		$	241,254	$	69,808		$	117,708	$	200,541

(1)Accounting Standard Codification 815-20 “Derivatives and Hedging.”

The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands):

		Carrying Value
Non-derivative instrument designated as hedging instrument under ASC 815-20	Balance Sheet Location	As of March 31, 2022		As of December 31, 2021
Foreign currency debt	Current portion of debt	$	64,938	$	75,518
Foreign currency debt	Long-term debt	45,165		34,795
		$	110,103	$	110,313

The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive loss was as follows (in thousands):

Derivatives and Related Hedged Items under ASC 815-20 Fair Value Hedging Relationships	Location of Gain (Loss) Recognized in Income on Derivative and Hedged Item	Amount of Gain (Loss) Recognized in Income on Derivative				Amount of Gain (Loss) Recognized in Income on Hedged Item
		Quarter Ended March 31, 2022		Quarter Ended March 31, 2021		Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Interest rate swaps	Interest expense (income), net of interest capitalized	$	(3,365)	$	(552)	$	6,024	$	2,930
		$	(3,365)	$	(552)	$	6,024	$	2,930

The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands):

Line Item in the Statement of Financial Position Where the Hedged Item is Included	Carrying Amount of the Hedged Liabilities				Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities
	As of March 31, 2022		As of December 31, 2021		As of March 31, 2022		As of December 31, 2021
Current portion of debt and Long-term debt	$	649,755	$	655,502	$	404	$	6,428
	$	649,755	$	655,502	$	404	$	6,428

The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands):

Derivatives under ASC 815-20 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives
	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Interest rate swaps	$	74,865	$	43,408
Foreign currency forward contracts	(40,062)		(99,581)
Fuel swaps	189,816		55,246
	$	224,619	$	(927)

The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands):

Gain (Loss) Recognized in Income (Net Investment Excluded Components)	Three Months Ended March 31, 2022
Net inception fair value at January 1, 2022	$	(554)
Amount of gain recognized in income on derivatives for the period ended March 31, 2022	577
Amount of gain (loss) remaining to be amortized in accumulated other comprehensive loss, as of March 31, 2022	(39)
Fair value at March 31, 2022	$	(16)

The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands):

	Amount of Gain (Loss) Recognized in Other Comprehensive Loss
Non-derivative instruments under ASC 815-20 Net Investment Hedging Relationships	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Foreign Currency Debt	$	2,745	$	5,822
	$	2,745	$	5,822

There was no amount recognized in income (ineffective portion and amount excluded from effectiveness testing) for the quarters ended March 31, 2022 and March 31, 2021.

The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands):

		Amount of Gain (Loss) Recognized in Income on Derivatives
Derivatives Not Designated as Hedging Instruments under ASC 815-20	Location of Gain (Loss) Recognized in Income on Derivatives	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Foreign currency forward contracts	Other income (expense)	$	(6,985)	$	(13,498)
Fuel swaps	Other income (expense)	(7)		12,655
		$	(6,992)	$	(843)

Credit Related Contingent Features

Our current interest rate derivative instruments require us to post collateral if our Standard & Poor’s and Moody’s credit ratings fall below specified levels. Specifically, under most of our agreements, if on the fifth anniversary of executing a derivative instrument, or on any succeeding fifth-year anniversary, our credit ratings for our senior unsecured debt is rated below BBB- by Standard & Poor’s and Baa3 by Moody’s, then the counterparty will periodically have the right to demand that we post collateral in an amount equal to the difference between (i) the net market value of all derivative transactions with such counterparty that have reached their fifth year anniversary, to the extent negative, and (ii) the applicable minimum call amount.

The amount of collateral required to be posted will change as, and to the extent, our net liability position increases or decreases by more than the applicable minimum call amount. If our credit rating for our senior unsecured debt is subsequently equal to or above BBB- by Standard & Poor’s or Baa3 by Moody’s, then any collateral posted at such time will be released to us and we will no longer be required to post collateral unless we meet the collateral trigger requirement, generally, at the next fifth-year anniversary.

As of March 31, 2022, our senior unsecured debt credit rating was B by Standard & Poor's and B2 by Moody's. As of March 31, 2022, six of our interest rate derivative hedges had a term of at least five years requiring us to post collateral of $16.7 million to satisfy our obligations under our interest rate derivative agreements, taking into account collateral waivers issued by certain banks. We expect that we will not need to provide additional collateral under these agreements in the next twelve months.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 

Cautionary Note Concerning Forward-Looking Statements

The discussion under this caption "Management's Discussion and Analysis of Financial Condition and Results of Operations" and elsewhere in this Quarterly Report on Form 10-Q includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, business and industry prospects or future results of operations or financial position, made in this Quarterly Report on Form 10-Q are forward-looking. Words such as "anticipate," "believe," "considering," "could," "driving," "estimate," "expect," "goal," "intend," "may," "plan," "project," "seek," "should," "will," "would," and similar expressions are intended to further identify any of these forward-looking statements. Forward-looking statements reflect management's current expectations but they are based on judgments and are inherently uncertain. Furthermore, they are subject to risks, uncertainties and other factors that could cause our actual results, performance or achievements to differ materially from the future results, performance or achievements expressed or implied in those forward-looking statements. Examples of these risks, uncertainties and other factors include, but are not limited to, those discussed in this Quarterly Report on Form 10-Q and, in particular, the risks discussed under the caption "Risk Factors" in Part II, Item 1A herein.

All forward-looking statements made in this Quarterly Report on Form 10-Q speak only as of the date of this filing.  Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.  

Overview

The discussion and analysis of our financial condition and results of operations is organized to present the following:

•a review of our financial presentation, including discussion of certain operational and financial metrics we utilize to assist us in managing our business;

•a discussion of our results of operations for the quarter ended March 31, 2022, compared to the same period in 2021;

•a discussion of our business outlook; and

•a discussion of our liquidity and capital resources, including our future capital and contractual commitments and potential funding sources. 

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Critical Accounting Policies and Estimates

For a discussion of our critical accounting policies and estimates, refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations within our Annual Report on Form 10-K for the year ended December 31, 2021.

Seasonality

Our revenues are seasonal based on demand for cruises. Demand has historically been strongest for cruises during the Northern Hemisphere’s summer months and holidays. In order to mitigate the impact of the winter weather in the Northern Hemisphere and to capitalize on the summer season in the Southern Hemisphere, our brands have historically focused on deployment to the Caribbean, Asia and Australia during that period. This seasonal trend was disrupted with the voluntary suspension of our global cruise operations effective March 2020 in response to the COVID-19 outbreak and through the gradual resumption of global cruise operations commencing in the second half of 2021.

Recent Developments

Return to Healthy Sailing

During 2021, we restarted our global cruise operations in a phased manner, following our voluntary suspension of global cruise operations that commenced in March of 2020 in response to the COVID-19 pandemic. Since then, we have steadily increased the number of ships that have returned to service. As of March 31, 2022, we operated 54 of our Global and Partner Brand ships, representing close to 90% of our worldwide capacity. We expect that the rest of the fleet will return to operations before the summer season. Our return to service efforts incorporate our enhanced health and safety protocols, and the requirements of regulatory agencies, which has resulted in reduced guest occupancy, modified itineraries and vaccination protocols.

Uncertainties remain as to the continuing effects COVID-19 will have on our operations, including potential increases in infection rates, new variants, and renewed governmental action to slow the spread of COVID-19, which may lead us to cancel or modify certain of our Global Brands’ cruise sailings. Additionally, there is uncertainty surrounding consumer behavior and demand for cruising. The continuing effects of COVID-19 on our resumption of guest cruise operations and the increased uncertainty given the current war in Ukraine, including its effect on the price of fuel and food, are collectively having a material negative impact on our business, including our liquidity, financial position and results of operations.

Continued Fleet Ramp-up

Wonder of the Seas and Celebrity Beyond were delivered and commenced operations in the first quarter and second quarter, respectively, which expanded our total fleet size, including our Partner Brands, to 63 ships.

We are currently offering cruise itineraries in the majority of our destinations. Australia, one of the last remaining countries to re-open, has announced the resumption of cruising effective April 2022. We expect to return to Australia for the local summer season during the fourth quarter of 2022. China remains closed to cruising, resulting in the redeployment of ships planned for China to other markets.

Operating Costs

As we resume our return to service, we are experiencing inflationary and supply chain challenges, mainly related to fuel and food costs, as well as transitory costs related to our health and safety protocols. We expect these challenges to have an adverse impact to our 2022 operating costs.

Update on Bookings

Booking volumes in the first quarter of 2022 have improved consistently week-over-week and reached typical, peak booking season ("Wave") levels at the end of the quarter. Bookings have now been surpassing comparable 2019 levels for the last two months, with particularly strong trends for North America based itineraries. Additionally, the elevated cancellations experienced earlier in the year attributable to the Omicron variant returned to pre-Omicron levels as COVID-19 cases subsided in February 2022.

While load factors for sailings in the second half of 2022 are currently slightly below historical levels, consumers are booking their cruises closer to sailing and we are capitalizing on the close-in demand to improve load factors.

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Bookings for Europe sailings improved throughout the first quarter but softened due to the war in Ukraine, with a bigger impact on Baltic itineraries. While bookings for Europe are now exceeding 2019 levels for the same period, the situation in Ukraine is expected to weigh on load factors in Europe this summer.

As of March 31, 2022 we had $3.6 billion in customer deposits. Approximately 27% of the customer deposit balance as of March 31, 2022 is related to FCCs compared to 32% of the customer deposit balance as of December 31, 2021, a positive trend indicating new demand.

Update on Recent Liquidity Actions and Ongoing Uses of Cash

Refer to Funding Needs and Sources for discussion regarding our recent liquidity actions and ongoing uses of cash.

Capital Expenditures

Refer to Future Capital Commitments for discussion on capital expenditures.

Debt Maturities, New Financings and Other Liquidity Actions

During the quarter ended March 31, 2022, we continued to take actions to further improve our liquidity position and manage cash flow. In particular, we:

•issued $1.0 billion of senior notes (the "January 2022 Unsecured Notes") due in 2027 for net proceeds of approximately $990.0 million. Interest accrues on the January 2022 Unsecured Notes at a fixed rate of 5.375% per annum and is payable semi-annually in arrears; and

•entered into certain agreements with Morgan Stanley & Co., LLC (“MS”) where MS agrees to provide backstop committed financing to refinance, repurchase and/or repay in whole or in part our existing and outstanding 10.875% Senior Secured Notes due 2023, 9.125% Senior Priority Guaranteed Notes due 2023 (the "Priority Guaranteed Notes"), and 4.25% Convertible Notes due 2023. We may, at our sole option, issue and sell to MS (subject to the satisfaction of certain conditions) five-year senior unsecured notes with gross proceeds of up to $3.15 billion at any time between April 1, 2023 and June 29, 2023, to refinance the aforementioned notes.

Expected debt maturities for the remainder of 2022 are $2.2 billion and $5.7 billion for 2023. We continue to identify and evaluate further actions to enhance our liquidity and support our recovery. These include and are not limited to further reductions in capital expenditures, operating expenses and administrative costs and additional financings.

Results of Operations

Summary

Net Loss and Adjusted Net Loss for the first quarter of 2022 were $(1.17) billion and $(1.16) billion, or $(4.58) and $(4.57) per share on a diluted basis, respectively, reflecting the ramp up of our return to operations, and increased sales and marketing expenses, compared to Net Loss and Adjusted Net Loss of $(1.13) billion and $(1.08) billion, or $(4.66) and $(4.44) per share on a diluted basis, respectively, for the first quarter of 2021.

Significant items for the quarter ended March 31, 2022 include:

•Total revenues, excluding the effect of changes in foreign currency exchange rates, increased $1.0 billion for the quarter ended March 31, 2022 as compared to the same period in 2021, The increase reflects the ramp up in our return to operations in 2022 compared to 2021 when the suspension of our global cruise operations was in effect. APCDs for the first quarter ended March 31, 2022 were 7,692,906 compared to 384,224 in the same period in 2021.

•Total cruise operating expenses, excluding the effect of changes in foreign currency exchange rates, increased $0.9 billion for the quarter ended March 31, 2022 as compared to the same period in 2021. The increase reflects the ramp up in our return to operations in 2022 compared to 2021 when the suspension of our global cruise operations was in effect.

•In January 2022, we took delivery of Wonder of the Seas.

•In January 2022, we issued the January 2022 Unsecured Notes. Refer to Note 6. Debt to our consolidated financial statements under Part I. Item 1. Financial Statements for further information regarding this transaction.

•In February 2022, we entered into certain agreements with MS where MS agrees to provide backstop committed financing. Refer to Note 6. Debt to our consolidated financial statements under Part I. Item 1. Financial Statements for further information regarding this transaction.

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Operating results for the quarter ended March 31, 2022 compared to the same period in 2021 are shown in the following table (in thousands, except per share data):

	Quarter Ended March 31,
	2022				2021
			% of Total Revenues				% of Total Revenues
Passenger ticket revenues	$	651,858	61.5	%	$	20,844	49.6	%
Onboard and other revenues	407,373		38.5	%	21,170		50.4	%
Total revenues	1,059,231		100.0	%	42,014		100.0	%
Cruise operating expenses:
Commissions, transportation and other	150,343		14.2	%	2,949		7.0	%
Onboard and other	74,439		7.0	%	4,481		10.7	%
Payroll and related	349,618		33.0	%	96,636		230.0	%
Food	100,184		9.5	%	8,472		20.2	%
Fuel	188,480		17.8	%	41,822		99.5	%
Other operating	321,705		30.4	%	129,127		307.3	%
Total cruise operating expenses	1,184,769		111.9	%	283,487		674.7	%
Marketing, selling and administrative expenses	394,030		37.2	%	258,041		614.2	%
Depreciation and amortization expenses	339,467		32.0	%	310,166		738.2	%
Impairment and credit losses	173		—	%	(449)		(1.1)	%
Operating Loss	(859,208)		(81.1)	%	(809,231)		(1,926.1)	%
Other (expense) income:
Interest income	3,322		0.3	%	4,861		11.6	%
Interest expense, net of interest capitalized	(277,659)		(26.2)	%	(272,514)		(648.6)	%
Equity investment loss	(31,059)		(2.9)	%	(59,871)		(142.5)	%
Other (expense) income	(2,538)		(0.2)	%	5,033		12.0	%
	(307,934)		(29.1)	%	(322,491)		(767.6)	%
Net Loss	(1,167,142)		(110.2)	%	(1,131,722)		(2,693.7)	%
Diluted Loss per Share	$	(4.58)			$	(4.66)

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Adjusted Net Loss and Adjusted Loss per Share were calculated as follows (in thousands, except per share data):

	Quarter Ended March 31,
	2022		2021
Net Loss	$	(1,167,142)	$	(1,131,722)
Adjusted Net Loss	(1,164,373)		(1,078,279)
Net Adjustments to Net Loss	$	2,769	$	53,443
Adjustments to Net Loss:
Impairment and credit losses (recoveries)	$	173	$	(449)
Restructuring charges and other initiatives expense	973		1,317
Amortization of Silversea Cruises intangible assets related to Silversea Cruises acquisition	1,623		1,623
Convertible debt amortization of debt discount (1)	—		26,073
Pullmantur reorganization settlement (2)	—		5,000
Loss on extinguishment of debt	—		1,314
Equity investment impairment (3)	—		26,042
Oasis of the Seas incident (4)	—		(1,321)
Net gain related to the sale of the Azamara brand	—		(6,156)
Net Adjustments to Net Loss	$	2,769	$	53,443
Basic:
Loss per Share	$	(4.58)	$	(4.66)
Adjusted Loss per Share	$	(4.57)	$	(4.44)
Diluted:
Loss per Share	$	(4.58)	$	(4.66)
Adjusted Loss per Share	$	(4.57)	$	(4.44)
Weighted-Average Shares Outstanding:
Basic	254,821		243,004
Diluted	254,821		243,004

(1)Represents the amortization of non-cash debt discount on our convertible notes. For further information regarding the adoption of ASU 2020-06 as of January 1, 2022, which impacts the accounting of the non-cash debt discount on convertible notes, refer to Note 2. Summary of Significant Accounting Policies to our consolidated financial statements.

(2)Represents estimated cash refunds expected to be paid to Pullmantur guests as part of the Pullmantur S.A. reorganization.

(3)Represents equity investment asset impairments primarily for TUI Cruises GmbH in 2021 as a result of the impact of COVID-19.

(4)Represents net insurance recoveries related to the collapse of the drydock structure at the Grand Bahama Shipyard involving Oasis of the Seas.

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Selected statistical information is shown in the following table:

	Quarter Ended March 31,
	2022 (1)		2021 (2)
Passengers Carried	734,809		41,209
Passenger Cruise Days	4,418,899		144,916
APCD	7,692,906		384,224
Occupancy	57.4	%	37.7	%

(1)Due to the elimination of the Silversea Cruises three-month reporting lag in October 2021, we included Silversea Cruises' metrics from January 1, 2022 through March 31, 2022 in the quarter ended March 31, 2022.

(2)Due to the three-month reporting lag, we included Silversea Cruises' metrics from October 1, 2020 through December 31, 2020 in the quarter ended March 31, 2021.

2022 Outlook

The Company’s operations are still impacted by COVID-19 and its related variants. The adverse impact of the COVID-19 pandemic on our revenues, consolidated results of operations, cash flows and financial condition has been and will continue to be material in 2022. We expect to incur a net loss on both a U.S. GAAP and adjusted basis for our second quarter of 2022 and a return to profitability for the second half of 2022. See Recent Developments– Continued Fleet Ramp-Up and Update on Bookings for further indication on our resumption of operations and the booking environment.

Financial Presentation

Description of Certain Line Items

Revenues

Our revenues are comprised of the following:

•Passenger ticket revenues, which consist of revenue recognized from the sale of passenger tickets and the sale of air transportation to and from our ships; and

•Onboard and other revenues, which consist primarily of revenues from the sale of goods and/or services onboard our ships not included in passenger ticket prices, cancellation fees, sales of vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Onboard and other revenues also include revenues we receive from independent third-party concessionaires that pay us a percentage of their revenues in exchange for the right to provide selected goods and/or services onboard our ships, as well as revenues received for procurement and management related services we perform on behalf of our unconsolidated affiliates. 

Cruise Operating Expenses 

Our cruise operating expenses are comprised of the following:

•Commissions, transportation and other expenses, which consist of those costs directly associated with passenger ticket revenues, including travel agent commissions, air and other transportation expenses, port costs that vary with passenger head counts and related credit card fees;

•Onboard and other expenses, which consist of the direct costs associated with onboard and other revenues, including the costs of products sold onboard our ships, vacation protection insurance premiums, costs associated with pre- and post-cruise tours and related credit card fees, as well as the minimal costs associated with concession revenues, as the costs are mostly incurred by third-party concessionaires, and costs incurred for the procurement and management related services we perform on behalf of our unconsolidated affiliates;

•Payroll and related expenses, which consist of costs for shipboard personnel (costs associated with our shoreside personnel are included in Marketing, selling and administrative expenses);

•Food expenses, which include food costs for both guests and crew;

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•Fuel expenses, which include fuel and related delivery, storage and emission consumable costs and the financial impact of fuel swap agreements; and

•Other operating expenses, which consist primarily of operating costs such as repairs and maintenance, port costs that do not vary with passenger head counts, vessel related insurance, entertainment and gains and/or losses related to the sale of our ships, if any.  

We do not allocate payroll and related expenses, food expenses, fuel expenses or other operating expenses to the expense categories attributable to passenger ticket revenues or onboard and other revenues since they are incurred to provide the total cruise vacation experience.

Selected Operational and Financial Metrics 

We utilize a variety of operational and financial metrics which are defined below to evaluate our performance and financial condition. As discussed in more detail herein, certain of these metrics are non-GAAP financial measures. These non-GAAP financial measures are provided along with the related GAAP financial measures as we believe they provide useful information to investors as a supplement to our consolidated financial statements, which are prepared and presented in accordance with GAAP. The presentation of non-GAAP financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

Adjusted Loss per Share ("Adjusted EPS") represents Adjusted Net Loss (as defined below) divided by weighted average shares outstanding or by diluted weighted average shares outstanding, as applicable. We believe that this non-GAAP measure is meaningful when assessing our performance on a comparative basis.

Adjusted Net Loss represents net loss excluding certain items that we believe adjusting for is meaningful when assessing our performance on a comparative basis. For the periods presented, these items included (i) impairment and credit losses (recoveries); (ii) restructuring charges and other initiative expenses; (iii) the amortization of the Silversea Cruises intangible assets resulting from the Silversea Cruises acquisition in 2018; (iv) the amortization of non-cash debt discount on our convertible notes; (v) the estimated cash refunds expected to be paid to Pullmantur guests as part of the Pullmantur S.A. reorganization in 2020; (vi) loss on the extinguishment of debt; (vii) equity investment asset impairments; (viii) net insurance recoveries related to the collapse of the drydock structure at the Grand Bahama Shipyard involving Oasis of the Seas; and (ix) the net gain recognized in the first quarter of 2021 in relation to the sale of the Azamara brand.

Available Passenger Cruise Days (“APCD”) is our measurement of capacity and represents double occupancy per cabin multiplied by the number of cruise days for the period, which excludes canceled cruise days and cabins not available for sale. We use this measure to perform capacity and rate analysis to identify our main non-capacity drivers that cause our cruise revenue and expenses to vary.

Occupancy ("Load Factor"), in accordance with cruise vacation industry practice, occupancy is calculated by dividing Passenger Cruise Days (as defined below) by APCD. A percentage in excess of 100% indicates that three or more passengers occupied some cabins.

Passenger Cruise Days represent the number of passengers carried for the period multiplied by the number of days of their respective cruises.

Although discussed in previous periods, we did not disclose or reconcile in this report our Gross Yields, Net Yields, Gross Cruise Costs, Net Cruise Costs and Net Cruise Costs Excluding Fuel, as defined in our Annual Report on Form 10-K for the year ended December 31, 2019. Historically, we have utilized these financial metrics to measure relevant rate comparisons to other periods. However, our 2022 and 2021 reduction in capacity and revenues and the shift in the nature of our running costs, due to the impact of the COVID-19 pandemic on our operations, do not allow for a meaningful analysis and comparison of these metrics and as such these metrics have been excluded from this report.

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Quarter Ended March 31, 2022 Compared to Quarter Ended March 31, 2021

In this section, references to 2022 refer to the quarter ended March 31, 2022 and references to 2021 refer to the quarter ended March 31, 2021.

Revenues

Total revenues for 2022 increased $1.0 billion to $1.1 billion from $42.0 million in 2021.

Passenger ticket revenues comprised 61.5% of our 2022 total revenues. Passenger ticket revenues for 2022 increased by $0.6 billion to $0.7 billion from $20.8 million in 2021, and were partially offset by unfavorable movements in foreign currency exchange rates related to our revenue transactions denominated in currencies other than the United States dollar of $1.9 million.

The remaining 38.5% of 2022 total revenues was comprised of Onboard and other revenues, which increased $386.2 million to $407.4 million in 2022 from $21.2 million in 2021, and was partially offset by unfavorable movements in foreign currency exchange rates related to our revenue transactions denominated in currencies other than the United States dollar of $0.7 million.

The increase in revenues was due to the return of operations in 2022, in which the majority of our fleet was in service, compared to 2021, when the suspension of our global cruise operations was in effect. Occupancy in 2022 was 57.4% compared to 37.7% in 2021.

Onboard and other revenues included concession revenues of $48.4 million in 2022 and $0.7 million in 2021.

Cruise Operating Expenses

Total Cruise operating expenses for 2022 increased $0.9 billion to $1.2 billion from $283.5 million in 2021. The increase was primarily due to:

•a $253.0 million increase in Payroll and related;

•a $147.4 million increase in Commissions, transportation and other expenses;

•a $146.7 million increase in Fuel expense;

•a $91.7 million increase in Food expense ; and

•a $70.0 million increase in Onboard and other expenses.

The increase in operating expenses noted above was driven by the return to operations in 2022, with the majority of our fleet in service, compared to 2021, when the suspension of our global cruise operations was in effect. The 2022 operating expenses include the overhead costs associated with bringing our ships back to service and our crew back on board our ships. Additionally, as discussed above in Recent Developments, high inflation has impacted our operating costs, especially in fuel and food expense. Our cost of fuel (net of the financial impact of fuel swap agreements) for 2022 increased 55% per metric ton compared to 2021 mainly due to fuel price increase.

The increase in Cruise operating expenses was partially offset by the favorable effect of changes in foreign currency exchange rates related to our cruise operating expenses denominated in currencies other than the United States dollar of $4.9 million.

Marketing, Selling and Administrative Expenses

Marketing, selling and administrative expenses for 2022 increased $136.0 million, or 52.7%, to $394.0 million from $258.0 million in 2021. The increase was primarily due to the ramp up of our global sales and marketing efforts starting in the second half of 2021 as we commenced our resumption of operations.

Depreciation and Amortization Expenses 

Depreciation and amortization expenses for 2022 increased $29.3 million, or 9.4%, to $339.5 million from $310.2 million in 2021. The increase was primarily due to the addition of Wonder of the Seas to our fleet in January 2022 and a full quarter of depreciation for Odyssey of the Seas and Silver Dawn, which were delivered in March 2021 and November 2021, respectively.

Impairment and Credit Losses (Recoveries)

There were no significant Impairment and credit losses (recoveries) for 2022 and 2021.

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Other Income (Expense)

Interest expense, net of interest capitalized for 2022 increased $5.1 million, or 1.9%, to $277.7 million from $272.5 million in 2021. The increase was primarily due to new debt issuances after the first quarter of 2021 and through the first quarter of 2022, partially offset by the lower cost of debt in 2022 attributable to the partial repayment of the 11.50% Senior Secured Notes due 2025 during the third quarter of 2021 and the decrease in interest expense associated with the adoption of ASU 2020-06. Refer to Note 2. Summary of Significant Accounting Policies to our consolidated financial statements for further information on ASU 2020-06.

Equity investment loss decreased by $28.8 million, or 48.1%, to $31.1 million from $59.9 million primarily due to a reduction in losses for TUI Cruises, one of our equity investments, in 2022 compared to 2021.

Other (expense) income. We recognized Other (expense) of $2.5 million in 2022, compared to Other income of $5.0 million in 2021. The $7.6 million increase in expense was primarily due to the 2021 recognition of a $13.4 million gain related to the change in fair value of our fuel swap derivative instruments with no hedge accounting, which did not recur in 2022, which was partially offset by an increase of $9.3 million in foreign exchange gain on remeasurement of our monetary assets, net of hedging.

Other Comprehensive Income (Loss)

Other comprehensive income for 2022 increased $185.8 million or 609.4%, to $216.3 million from $30.5 million in 2021. The increase was primarily due to a Gain on cash flow derivative hedges in 2022 of $195.9 million compared to $10.3 million in 2021, mostly as a result of a significant increase in the fair value of our fuel swaps in 2022 compared to 2021.

Future Application of Accounting Standards

Refer to Note 2. Summary of Significant Accounting Policies to our consolidated financial statements for further information on Recent Accounting Pronouncements.

Liquidity and Capital Resources

Sources and Uses of Cash

Net cash used by operating activities decreased $280.3 million to cash used of $0.5 billion for the first quarter of 2022 compared to cash used of $0.8 billion for the same period in 2021. Our continued resumption of cruise operations in 2022 has generated an increase in guest ticket collections, resulting in an increase in customer deposits of $406.5 million during the first three months in 2022, compared to an increase of $95.9 million during the same period in 2021, when our global operations were suspended. The increase in customer deposits was partially offset by an increase in cruise operating expenses during the three months ended March 31, 2022, reflecting the associated costs of returning our fleet to service.

Net cash used in investing activities increased $475.6 million to cash used of $1.4 billion for the first three months in 2022, compared to cash used of $1.0 billion for the same period in 2021. The increase was primarily attributable to an increase in capital expenditures of $301.4 million during the first quarter of 2022, compared to the same period in 2021, and a decrease in proceeds from the sale of property and equipment and other assets of $175.4 million during the first quarter of 2021, which did not recur in 2022.

Net cash provided by financing activities was $1.2 billion for the first quarter of 2022, compared to cash provided of $3.2 billion for the same period in 2021. The decrease of $1.9 billion was primarily attributable to $1.6 billion of proceeds from common stock issuances during the three months ended March 31, 2021, which did not recur during the three months ended March 31, 2022, and higher repayments of debt of $0.6 billion during the first quarter of 2022, compared to the same period in 2021. These decreases were partially offset by repayments of commercial paper notes of $414.6 million during the first quarter of 2021, which did not recur in 2022.

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Future Capital Commitments

Capital Expenditures

COVID-19 has impacted shipyard operations which have and may continue to result in delays of our previously contracted ship deliveries. As of March 31, 2022, the dates that the ships on order by our Global and Partner Brands are expected to be delivered, subject to change in the event of construction delays, and their approximate berths are as follows:

Ship	Shipyard	Expected Delivery Date	Approximate Berths
Royal Caribbean International —
Oasis-class:
Utopia of the Seas	Chantiers de l'Atlantique	2nd Quarter 2024	5,700
Icon-class:
Icon of the Seas	Meyer Turku Oy	3rd Quarter 2023	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2025	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2026	5,600
Celebrity Cruises —
Edge-class:
Celebrity Beyond	Chantiers de l'Atlantique	2nd Quarter 2022	3,250
Celebrity Ascent	Chantiers de l'Atlantique	4th Quarter 2023	3,250
Silversea Cruises
Evolution Class:
Silver Nova	Meyer Werft	2nd Quarter 2023	730
Unnamed	Meyer Werft	2nd Quarter 2024	730
TUI Cruises (50% joint venture)
Mein Schiff 7	Meyer Turku Oy	2nd Quarter 2024	2,900
Unnamed	Fincantieri	4th Quarter 2024	4,100
Unnamed	Fincantieri	2nd Quarter 2026	4,100
Total Berths			41,560

We took delivery of Celebrity Beyond in April of 2022. In addition, as of March 31, 2022, we have an agreement in place with Chantiers de l’Atlantique to build an additional fifth Edge-class ship with capacity of approximately 3,250, estimated for delivery in 2025, which is contingent upon completion of conditions precedent and financing.

Our future capital commitments consist primarily of new ship orders. As of March 31, 2022, the aggregate expected cost of our ships on order presented in the table above, excluding any ships on order by our Partner Brands, was $10.7 billion, of which we had deposited $0.6 billion. Approximately 61.8% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at March 31, 2022.

The continuing effects of COVID-19, including uncertainties related to demand for cruising, has had, and is expected to continue to have, a material impact on our cash flows, liquidity and financial position. In order to preserve liquidity throughout the suspension of our global cruise operations and gradual resumption of operations, we deferred a significant portion of our planned 2020, 2021 and 2022 capital expenditures. As of March 31, 2022, we anticipate overall full year capital expenditures, based on our existing ships on order, will be approximately $3.0 billion for 2022. This amount does not include any ships on order by our Partner Brands.  

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Material Cash Requirements

As of March 31, 2022, our material cash requirements were as follows (in thousands):

	Payments due by period
			Less than		1-3		3-5		More than
	Total		1 year		years		years		5 years
Operating Activities:
Operating lease obligations(1)	$	1,259,460	$	106,539	$	190,653	$	150,551	$	811,716
Interest on debt(2)	6,429,812		1,548,190		2,278,074		1,488,442		1,115,106
Other(3)	693,702		206,408		180,781		130,679		175,834
Investing Activities:	0
Ship purchase obligations(4)	8,397,542		1,170,446		4,624,835		2,602,261		—
Financing Activities:	0
Debt obligations(5)	22,073,589		2,507,929		8,711,141		4,974,445		5,880,074
Finance lease obligations(6)	428,387		50,534		49,968		43,755		284,130
Other(7)	14,611		7,388		7,223		—		—
Total	$	39,297,103	$	5,597,434	$	16,042,675	$	9,390,133	$	8,266,860

(1)     We are obligated under noncancelable operating leases primarily for preferred berthing arrangements, real estate and shipboard equipment. Amounts represent contractual obligations with initial terms in excess of one year.

(2)      Long-term debt obligations mature at various dates through fiscal year 2034 and bear interest at fixed and variable rates. Interest on variable-rate debt is calculated based on forecasted debt balances, including the impact of interest rate swap agreements using the applicable rate at March 31, 2022. Debt denominated in other currencies is calculated based on the applicable exchange rate at March 31, 2022.

(3)    Amounts primarily represent future commitments with remaining terms in excess of one year to pay for our usage of certain port facilities, marine consumables, services and maintenance contracts.

(4)    Amounts are based on contractual installment and delivery dates for our ships on order. Included in these figures are $6.5 billion in final contractual installments, which have committed financing. COVID-19 has impacted shipyard operations which have and may result in delays for our previously contracted ship deliveries. Amounts do not include potential obligations which remain subject to cancellation at our sole discretion or any agreements entered for ships on order that remain contingent upon completion of conditions precedent.

(5)    Debt denominated in other currencies is calculated based on the applicable exchange rate at March 31, 2022. In addition, debt obligations presented above are net of debt issuance costs of $416.9 million as of March 31, 2022.

(6)    Amounts represent finance lease obligations with initial terms in excess of one year.

(7)    Amounts represent fees payable to sovereign guarantors in connection with certain of our export credit debt facilities and facility fees on our revolving credit facilities.

Please refer to Funding Needs and Sources for discussion on the planned funding of the above material cash requirements.

As a normal part of our business, depending on market conditions, pricing and our overall growth strategy, we continuously consider opportunities to enter into contracts for the building of additional ships. We may also consider the sale of ships or the purchase of existing ships. We continuously consider potential acquisitions and strategic alliances. If any of these were to occur, they would be financed through the incurrence of additional indebtedness, the issuance of additional shares of equity securities or through cash flows from operations.

Off-Balance Sheet Arrangements

TUI Cruises has entered into various ship construction and credit agreements that include certain restrictions on each of our and TUI AG’s ability to reduce our current ownership interest in TUI Cruises below 37.55% through May 2033.

Some of the contracts that we enter into include indemnification provisions that obligate us to make payments to the counterparty if certain events occur. These contingencies generally relate to changes in taxes, increased lender capital costs and other similar costs. The indemnification clauses are often standard contractual terms and are entered into in the normal course

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of business.  There are no stated or notional amounts included in the indemnification clauses and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have not been required to make any payments under such indemnification clauses in the past and, under current circumstances, we do not believe an indemnification obligation is probable.

Certain of our surety agreements with third party providers for the benefit of certain agencies and associations that provide travel related bonds, allow the sureties to request collateral. We also have agreements with our credit card processors relating to customer deposits received by us for future voyages. These agreements allow the credit card processors to require us, under certain circumstances, including breach of the financial covenants, the existence of other material adverse changes, excessive chargebacks, and other triggering events, to maintain a reserve that can be satisfied by posting collateral. As of March 31, 2022, we have posted letters of credit as collateral with our sureties and credit card processors under our revolving credit facilities in the amount of $117.2 million.

Executed amendments are in place for the majority of our credit card processors, waiving reserve requirements tied to breach of our financial covenants through at least September 30, 2022, with modified covenants thereafter, and as such, we do not anticipate any incremental collateral requirements for the processors covered by these waivers in the next 12 months. We have a reserve with a processor where the agreement was amended in the first quarter of 2021, such that proceeds are held in reserve until the sailing takes place or the funds are refunded to the customer. The maximum projected exposure with the processor, including amounts currently withheld and reported in Trade and other receivables, is approximately $293.9 million. The amount and timing are dependent on future factors that are uncertain, such as pace of resumption of our cruise operations, the volume of future deposits and whether we transfer our business to other processors. If we require additional waivers on the credit card processing agreements and are not able to obtain them, this could lead to the termination of these agreements or the trigger of reserve requirements.

As of March 31, 2022, other than the items described above, we are not party to any other off-balance sheet arrangements, including guarantee contracts, retained or contingent interest, certain derivative instruments and variable interest entities, that either have, or are reasonably likely to have, a current or future material effect on our financial position.

Funding Needs and Sources

Historically, we relied on a combination of cash flows provided by operations, draw-downs under our available credit facilities, the incurrence of additional debt and/or the refinancing of our existing debt and the issuance of additional shares of equity securities to fund our obligations. COVID-19 resulted in our voluntary suspension of global cruise operations from March 2020 up to our gradual resumption of operations commencing in 2021. The suspension of operations strained our sources of cash flow and liquidity, causing us to take actions resulting in reductions in our operating expenses, reductions in our capital expenses and new financings and other liquidity actions.

The Company continues to identify and evaluate further actions to improve its liquidity. These include and are not limited to: further reductions in capital expenditures, operating expenses and administrative costs and additional financings. See further discussion on these liquidity actions at Recent Developments - COVID-19.

We have significant contractual obligations of which our debt service obligations and the capital expenditures associated with our ship purchases represent our largest funding needs. As of March 31, 2022, we had $8.4 billion of committed financing for our ships on order.

As of March 31, 2022, we had $5.6 billion in contractual obligations due through March 31, 2023, of which approximately $2.5 billion relates to debt maturities, $1.5 billion relates to interest on debt and $1.2 billion relates to progress payments on our ship orders and the final installment payable due upon the delivery of Celebrity Beyond.

As of March 31, 2022, we had liquidity of $3.8 billion, in the form of cash and cash equivalents of $2.0 billion, $1.1 billion of undrawn revolving credit facility capacity, and a $0.7 billion commitment for a 364-day term loan facility available to draw on at any time prior to August 12, 2022. Our revolving credit facilities were partially utilized through a combination of amounts drawn and letters of credit issued under the facilities as of March 31, 2022.

Beyond the next 12 months, in June of 2023, approximately $3.2 billion of long- term debt will become due. Accordingly, in addition to our $3.8 billion liquidity as of March 31, 2022, in February 2022 we entered into certain agreements with MS where MS agrees to provide backstop committed financing to refinance, repurchase and/or repay in whole or in part our existing and outstanding 10.875% Senior Secured Notes due 2023, the Priority Guaranteed Notes, and 4.25% Convertible Notes due 2023. Pursuant to the agreements, we may, at our sole option, issue and sell to MS (subject to the satisfaction of certain conditions) five-year senior unsecured notes with gross proceeds of up to $3.15 billion at any time between April 1, 2023 and June 29, 2023, to refinance the aforementioned notes.

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If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms. Our debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade. If this were to occur, it would have an adverse impact on our liquidity and operations.

Based on our assumptions and estimates and our financial condition, we believe that the liquidity resulting from the actions mentioned above will be sufficient to fund our liquidity requirements over at least the next twelve months. However, there is no assurance that our assumptions and estimates are accurate due to possible unknown variables related to this unprecedented suspension and gradual ramp up of our operations and, as such, there is inherent uncertainty in our ability to predict future liquidity requirements. Refer to Note 1. General, Management’s Plan and Liquidity, to our consolidated financial statements under Part I. Item 1. Financial Statements for further information.

Debt Covenants

Both our export credit facilities and our non-export credit facilities contain covenants that require us, among other things, to maintain a fixed charge coverage ratio of at least 1.25x and limit our net debt-to-capital ratio to no more than 62.5%, and under certain facilities, to maintain a minimum level of shareholders' equity. The fixed charge coverage ratio is calculated by dividing net cash from operations for the past four quarters by the sum of dividend payments plus scheduled principal debt payments in excess of any new financings for the past four quarters. Our minimum net worth and maximum net debt-to-capital calculations exclude the impact of Accumulated other comprehensive loss on Total shareholders’ equity.

During the first quarter of 2021, we amended $4.9 billion of our non-export credit facilities and $6.3 billion of our export credit facilities, and certain credit card processing agreements, to extend the waiver of our financial covenants through and including at least the third quarter of 2022, and subsequently in the third quarter of 2021, we entered into a letter agreement to extend the waiver period for our export credit facilities to the end of the fourth quarter of 2022. During the fourth quarter of 2021, we amended $7.3 billion of outstanding export-credit facilities plus committed export-credit facilities to modify financial covenant levels for 2023 and 2024, following the waiver period through and including the fourth quarter of 2022.

In addition, pursuant to the amendments for the non-export credit facilities, we have modified the manner in which such covenants are calculated, temporarily in certain cases and permanently in others, as well as the levels at which our net debt to capitalization covenant will be tested during the period commencing immediately following the end of the waiver period and continuing through the end of 2023.

The amendments impose a monthly-tested minimum liquidity covenant of $350 million, which in the case of the non-export credit facilities terminates at the end of the waiver period and in the case of the export credit facilities terminates either in July 2025, or when we pay off all deferred amounts, whichever is earlier. In addition, the amendments to the non-export credit facilities place restrictions on paying cash dividends and effectuating share repurchases through the end of the third quarter of 2022, while the export credit facility amendments require us to prepay any deferred amounts if we elect to issue dividends or complete share repurchases. As of March 31, 2022, we were in compliance with our financial covenants and we estimate that we will be in compliance for at least the next twelve months.

Any further covenant waivers may lead to increased costs, increased interest rates, additional restrictive covenants and other available lender protections as may be agreed with our lenders. There can be no assurance that we would be able to obtain additional waivers in a timely manner, or on acceptable terms. If we require additional waivers and are not able to obtain them or repay the debt facilities, this would lead to an event of default and potential acceleration of amounts due under all of our outstanding debt and derivative contracts.

Dividends

During the second quarter of 2020, we agreed with certain of our lenders not to pay dividends or engage in common stock repurchases for so long as our debt covenant waivers are in effect. In addition, in the event we declare a dividend or engage in share repurchases, we will need to repay the amounts deferred under our export credit facilities. Accordingly, we did not declare a dividend during the eight consecutive quarters ended March 31, 2022. Pursuant to amendments made to these agreements during the first quarter of 2021, the restrictions on paying cash dividends and effectuating share repurchases were extended through and including the third quarter of 2022.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk

For a discussion of our market risks, refer to Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk in our Annual Report on Form 10-K for the year ended December 31, 2021. There have been no material changes to our exposure to market risks since the date of our 2021 Annual Report.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based upon such evaluation, our Chief Executive Officer and Chief Financial Officer concluded that those disclosure controls and procedures are effective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and our Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure and are effective to provide reasonable assurance that such information is recorded, processed, summarized and reported within the time periods specified by the rules and forms of the Securities and Exchange Commission (the "SEC")..

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Exchange Act Rule 13a-15(d) during the quarter ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of future events. Because of these and other inherent limitations of control systems, there is only reasonable assurance that our controls will succeed in achieving their goals under all potential future conditions.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

As previously reported, two lawsuits were filed against us in August 2019 in the U.S. District Court for the Southern District of Florida ("the "Court") under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act. The complaint filed by Havana Docks Corporation ("Havana Docks Action") alleges it holds an interest in the Havana Cruise Port Terminal and the complaint filed by Javier Garcia-Bengochea (the "Port of Santiago Action") alleges that he holds an interest in the Port of Santiago, Cuba, both of which were expropriated by the Cuban government. The complaints further allege that we trafficked in those properties by embarking and disembarking passengers at these facilities. The plaintiffs seek all available statutory remedies, including the value of the expropriated property, plus interest, treble damages, attorneys’ fees and costs. The Court dismissed the Port of Santiago Action with prejudice on the basis that the plaintiff lacked standing, and the plaintiff’s appeal of the dismissal is awaiting a decision by the appellate court. In the Havana Docks Action, on March 21, 2022, the Court granted summary judgement in favor of the plaintiff as to liability, which we have sought permission from the Court to immediately appeal, and a trial on damages has been scheduled for September 2022. We believe we have meritorious defenses to the claims alleged in both the Havana Docks Action and the Port of Santiago Action, and we intend to vigorously defend ourselves against them. The outcome of the litigation is inherently unpredictable and subject to significant uncertainties, and there can be no assurances that the final outcome of either case will not be material.

We are also routinely involved in claims typical within the cruise vacation industry. The majority of these claims are covered by insurance. We believe the outcome of such claims, net of expected insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows.

Item 1A. Risk Factors

The risk factors set forth below and elsewhere in this Quarterly Report on Form 10-Q are important factors that could cause actual results to differ from expected or historical results. It is not possible to predict or identify all such risks. There may be additional risks that we consider not to be material, or which are not known, and any of these risks could affect our operations. The ordering of the risk factors set forth below is not intended to reflect a risk's potential likelihood or magnitude. See Part I, Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations for a cautionary note regarding forward-looking statements.

COVID-19 and Financial Risks

The COVID-19 pandemic has had, and continues to have, a material adverse impact on our business, results of operations and liquidity. The global spread of COVID-19, the unprecedented responses by governments and other authorities to control and contain the disease, including related variants, and challenges to global vaccination efforts, have caused significant disruptions, created new risks, and exacerbated existing risks to our business.

We have been, and continue to be, negatively impacted by the COVID-19 pandemic, including impacts that resulted or may result from actions taken in response to the outbreak and the occurrence and spread of related variants. Examples of these include, but are not limited to, cruising advisories and required or voluntary travel restrictions, that resulted in the temporary suspension of our Global Brands' operations, from which we have resumed limited operations; restrictions on the movement and gathering of people; social distancing measures; shelter-in-place/stay-at-home orders; and disruptions to businesses in our supply chain. In addition to the restrictions affecting our business, the extent, duration, and magnitude of the COVID-19 pandemic’s effect on the economy and consumer demand for cruising and travel is evolving and difficult to predict. As such, these impacts may persist for an extended period of time or become more pronounced, even as we resume operations.

The COVID-19 pandemic also has elevated risks affecting significant parts of our business:

•Operations: While we have restarted our global cruise operations in a phased manner, following the March 2020 suspension of our global cruise operations, there is no assurance that our plan to resume operations will be successful. It is possible that future COVID-19 cases could occur onboard and, even if controlled and contained, it is uncertain whether we will need to suspend additional sailings and to what extent in such event. Onboard cases have resulted in illness among our guests and crew, incremental costs, guest refunds and negative publicity and media attention. In addition, we may face challenges in executing our return to service plans as a result of new and evolving operating protocols, including due to state laws regarding proof of vaccination requirements and related litigation, and possible changes in regulations in the countries in which we operate and plan to operate.

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Uncertainties remain as to the specifics, timing and costs of administering and implementing our health and safety measures, some of which may be significant. These measures also may negatively impact guest satisfaction. Based on our assessment of these requirements and recommendations, the status of COVID-19 infection and/or vaccination rates in the U.S. or globally or for other reasons, we may determine it necessary to cancel or modify certain of our Global Brands’ cruise sailings. In addition, there is no guarantee that the vaccines will continue to be effective. We believe the impact to our global bookings resulting from COVID-19 will continue to have a material negative impact on our results of operations and liquidity, which may be prolonged beyond containment of the disease and its variants

Our previous suspension of sailings and our gradual resumption of operations have led to a significant decline in our revenues and cash inflows, which required us to take cost and capital expenditure containment actions. Consequently, we reduced and furloughed some of our workforce, with approximately 23% of our U.S. shoreside employee base being impacted in 2020. Our ships and our shipboard crew are gradually being notified about new assignments as operations resume over time. We may be challenged in rebuilding the rest of our workforce which could delay our phased resumption of operations. In addition, we have reduced our planned capital spending through 2022, which may negatively impact or delay our execution of planned growth strategies, particularly as it relates to investments in our ships, technology, and our expansion of land-based developments. We also have taken actions to monitor and mitigate changes in our supply chain, and port destination availability, which may strain relationships with our vendors and port partners.

If we are unable to satisfy the safety standards applicable to our sailings, our operations may be negatively impacted and we could be exposed to reputational and legal risks. Due to the unprecedented and uncertain nature of the COVID-19 pandemic and related regulatory landscape, it is difficult to predict the impact of further disruptions and their magnitude. In addition, we have never previously experienced a complete cessation of our cruising operations or a subsequent phased resumption of operations, and as a consequence, we are unable to predict with certainty the impact of such a cessation or phased resumption of operations on our brands and future prospects.

•Results of Operations: Our suspensions of sailings have materially impacted the results of our operations. We have incurred and will continue to incur significant costs as we accommodate passengers due to cancelled sailings. In addition, we have incurred and will likely continue to incur significant overhead costs associated with the return to service of our fleet and enhanced COVID-19 related cleaning, testing, vaccination and other mitigation procedures. We may experience volatility in demand for cruising for an indeterminable length of time due to the uncertain nature of the COVID-19 pandemic and ongoing concerns about health and safety, and we cannot predict with certainty when we will return to pre-pandemic demand or fare pricing or if we will return to such levels in the foreseeable future. In turn, these negative impacts to our financial performance have resulted and may continue to result in impairments of our long-lived and intangible assets, which has influenced our decision making relating to early disposal, sale or retirement of assets. Following the resumption of operations, our Global Brands and our Partner Brands may be subject to the continued impact of the COVID-19 pandemic. Additionally, any future profitability will be impacted by increased debt service costs as a result of our liquidity actions.

•Liquidity: Our ability to raise additional financing, whether or not secured, could be limited if our credit rating is further downgraded, and/or if we fail to comply with applicable covenants governing our outstanding indebtedness, and/or if overall financial market conditions worsen. Additionally, due to the complexity of the pandemic’s impact to the economy and uncertainty of its duration, we cannot guarantee that assumptions used to project our liquidity needs will be correct, which may result in the need for additional financing and/or may result in the inability to satisfy covenants required by our current credit facilities. If we raise additional funds through equity or convertible debt issuances, our shareholders could experience dilution of their ownership interest, and these equity or convertible debt securities could have rights, preferences, and privileges that are superior to that of holders of our common stock. If we raise additional funds by issuing debt, we may be subject to additional limitations on our operations due to restrictive covenants, which may be more restrictive than the covenants in our existing debt agreements, and we may be required to further encumber our assets. Also, as a result of our additional debt issuances, we will require a significant amount of cash to service our debt and sustain operations. Our ability to generate cash depends on factors beyond our control and we may be unable to repay or repurchase debt at maturity. If adequate funds are not available on acceptable terms, or at all, we may be unable to fund our operations, or respond to competitive pressures, any of which could negatively affect our business. There is no guarantee that financing will be available in the future or that such financing will be available with similar terms or terms that are commercially acceptable to us.

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We may not be able to obtain sufficient financing or capital for our needs or may not be able to do so on terms that are acceptable or consistent with our expectations.

To fund our capital expenditures (including new ship orders), operations and scheduled debt payments, we have historically relied on a combination of cash flows provided by operations, drawdowns under available credit facilities, the incurrence of additional indebtedness and the sale of equity or debt securities in private or public securities markets. Any circumstance or event which leads to a decrease in consumer cruise spending, such as worsening global economic conditions or significant incidents impacting the cruise industry, such as the COVID-19 pandemic, negatively affects our operating cash flows. We had net cash outflows from operations for the three months ended March 31, 2022. As result of the COVID-19 pandemic and the resulting suspension of our operations, we have experienced credit rating downgrades, which have reduced our ability to incur secured indebtedness by reducing the amount of indebtedness that we are permitted to secure, and may negatively impact our access to, and cost of, debt financing.

Our ability to access additional funding as and when needed, our ability to timely refinance and/or replace our outstanding debt securities and credit facilities on acceptable terms and our cost of funding will depend upon numerous factors including, but not limited to, the strength of the financial markets, our recovery and financial performance, the recovery and performance of our industry in general and the size, scope and timing of our financial needs. In addition, even where financing commitments have been secured, significant disruptions in the capital and credit markets could cause our banking and other counterparties to breach their contractual obligations to us or could cause the conditions to the availability of such funding not to be satisfied. This could include failures of banks or other financial service companies to fund required borrowings under our loan agreements or to pay us amounts that may become due or return collateral that is refundable under our derivative contracts for hedging of fuel prices, interest rates and foreign currencies or other agreements. If any of the foregoing occurs for a prolonged period of time it will have a long-term negative impact on our cash flows and our ability to meet our financial obligations.

Our substantial debt requires a significant amount of cash to service and could adversely affect our financial condition.

We have a substantial amount of debt and significant debt service obligations. As of March 31, 2022, we had total debt of $22.5 billion. Our substantial debt has required us to dedicate a large portion of our cash flow from operations to service debt and fund repayments on our debt, thereby reducing the availability of our cash flow to fund working capital, capital expenditures and other general corporate expenses.

Our ability to make future scheduled payments on our debt service obligations or refinance our debt depends on our future operating and financial performance and ability to generate cash. This will be affected by our ability to successfully implement our business strategy, as well as general economic, financial, competitive, regulatory and other factors beyond our control, such as the disruption caused by the COVID-19 pandemic. If we cannot generate sufficient cash to meet our debt service obligations or fund our other business needs, we may, among other things, need to refinance all or a portion of our debt, obtain additional financing, delay planned capital expenditures or sell assets. We cannot assure that we will be able to generate sufficient cash through any of the foregoing. If we are not able to refinance any of our debt, obtain additional financing or sell assets on commercially reasonable terms or at all, we may not be able to satisfy our obligations with respect to our debt.

Our substantial debt could also result in other negative consequences for us. For example, it could increase our vulnerability to adverse general economic or industry conditions; limit our flexibility in planning for, or reacting to, changes in our business or the industry in which we operate; place us at a competitive disadvantage compared to our competitors that have less debt; make us more vulnerable to downturns in our business, the economy or the industry in which we operate, including the current downturn related to COVID-19; limit our ability to raise additional debt or equity capital in the future to satisfy our requirements relating to working capital, capital expenditures, development projects, strategic initiatives or other purposes; restrict us from making strategic acquisitions, introducing new technologies or exploiting business opportunities; limit or restrict our ability to obtain and maintain performance bonds to cover our financial responsibility requirements in various jurisdictions for non-performance of guest travel, casualty and personal injury; make it difficult for us to satisfy our obligations with respect to our debt; and increase our exposure to the risk of increased interest rates as certain of our borrowings are (and may in the future be) at a variable rate of interest.

Despite our leverage, we may incur more debt, which could adversely affect our business.

We may incur substantial additional debt in the future. Except for the restrictions under the indentures governing our Secured Notes, our Priority Guaranteed Notes, and certain of our other debt instruments, including our unsecured bank and export credit facilities, we are not restricted under the terms of our debt instruments from incurring additional debt. Although the indentures governing the Secured Notes, the Priority Guaranteed Notes, and certain of our other debt instruments, including our unsecured bank and export credit facilities, contain restrictions on the incurrence of additional debt, these restrictions are subject to a number of significant qualifications and exceptions, and under certain circumstances the amount of debt that could be incurred in compliance with these restrictions could be substantial. In the event that we execute and borrow under the

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$0.7 billion commitment available to draw on at any time prior to August 12, 2022 for a 364-day term loan facility, the credit agreement that would govern such term loan facility would impose substantially similar restrictions (including the related qualifications and exceptions) as are set forth in the indenture governing the Priority Guaranteed Notes. If new debt is added to our existing debt levels, the related risks that we now face would increase. As of March 31, 2022, we have commitments for approximately $8.4 billion of debt to finance the purchase of 8 ships on order by our Royal Caribbean International, Celebrity Cruises and Silversea Cruises brands, all of which are guaranteed by the export credit agencies in the countries in which the ships are being built. The ultimate size of each facility will depend on the final contract price (including change orders and owner’s supply) as well as fluctuations in the EUR/USD exchange rate.

We are subject to restrictive debt covenants that may limit our ability to finance our future operations and capital needs and to pursue business opportunities and activities. In addition, if we fail to comply with any of these restrictions, it could have a material adverse effect on us.

Certain of our debt instruments, including our indentures and our unsecured bank and export credit facilities, limit our flexibility in operating our business. For example, certain of our loan agreements and indentures restrict or limit our and our subsidiaries’ ability to, among other things, incur or guarantee additional indebtedness; pay dividends or distributions on, or redeem or repurchase capital stock and make other restricted payments; make investments; consummate certain asset sales; engage in certain transactions with affiliates; grant or assume certain liens; and consolidate, merge or transfer all or substantially all of our assets. In addition, both our export credit facilities and our non-export credit facilities contain covenants that will, once our current waivers expire, require us, among other things, to maintain a specified minimum fixed charge coverage ratio and limit our net debt-to-capital ratio. In addition, our ECA facilities also require us to maintain minimum liquidity and a minimum stock holders' equity. Refer to Note 6. Debt to our consolidated financial statements under Part I, Item 1, Financial Statements for further discussion on our covenants and existing waivers.

All of these limitations are subject to significant exceptions and qualifications. Despite these exceptions and qualifications, we cannot assure you that the operating and financial restrictions and covenants in certain of our debt instruments will not adversely affect our ability to finance our future operations or capital needs or engage in other business activities that may be in our interest. Any future indebtedness may include similar or other restrictive terms. In addition, our ability to comply with these covenants and restrictions may be affected by events beyond our control. These include prevailing economic, financial and industry conditions. If we breach any of these covenants or restrictions, we could be in default under such indebtedness and certain of our other debt instruments, and the relevant debt holders or lenders could elect to declare the debt, together with accrued and unpaid interest and other fees, if any, immediately due and payable and proceed against any collateral securing that debt. If the debt under certain of our debt instruments that we enter into were to be accelerated, our liquid assets may be insufficient to repay in full such indebtedness. Borrowings under other debt instruments that contain cross-default provisions also may be accelerated or become payable on demand. In these circumstances, our assets may not be sufficient to repay in full that indebtedness and our other indebtedness then outstanding.

In addition, our ability to maintain our credit facilities may also be impacted by changes in our ownership base. More specifically, we may be required to prepay our non-ECA and ECA facilities if any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period. Our debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade, which would require us to offer to repurchase our debt securities in the event of such change of control.

If we elect to settle conversions of our convertible notes in shares of our common stock or a combination of cash and shares of our common stock, conversions of our convertible notes will result in dilution for our existing shareholders.

We have an aggregate principal amount of $1.725 billion in convertible notes outstanding. If note holders elect to convert, the notes will be converted into our shares of common stock, cash, or a combination of common stock and cash, at our discretion. Prior to March 15 and August 15, 2023, our convertible notes issued in June 2020 and October 2020, respectively, will be convertible at the option of holders during certain periods only upon satisfaction of certain conditions. Beyond those dates, the convertible notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding their maturity date. Conversions of our convertible notes into shares of our common stock or a combination of common stock and cash, will result in dilution to our shareholders.

We did not declare quarterly dividends on our common stock in the quarter ended March 31, 2022 and do not expect to pay dividends on our common stock for the foreseeable future.

No cash dividends were declared on our common stock during the eight consecutive quarters ended March 31, 2022. We expect that any income received from operations will be devoted to our future operations and recovery. We do not expect to pay

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cash dividends on our common stock for the foreseeable future due to our agreement with certain of our lenders not to pay dividends until the end of the third quarter of 2022. In addition, in the event we thereafter declare a dividend, we will need to repay our amounts deferred under the export credit facilities. Payment of dividends would, in any case, depend upon our profitability at the time, cash available for those dividends, and other factors as our board of directors may consider relevant.

Increased regulatory oversight, and the phasing out of LIBOR may adversely affect the value of a portion of our indebtedness.

The publication of certain LIBOR settings ceased after December 31, 2021, and uncertainty regarding alternative reference rates remains as many market participants await a wider adoption of replacement products prior to the cessation of the remaining USD LIBOR tenors (currently scheduled for June 30, 2023). When LIBOR ceases to exist, the level of interest payments on the portion of our indebtedness that bears interest at variable rates might be affected if we, the agent, and/or the lenders holding a majority of the outstanding loans or commitments under such indebtedness fail to amend such indebtedness to implement a replacement rate. Regardless, such replacement rate will give due consideration to any evolving or then-existing conventions for similar credit facilities, which may result in different than expected interest payments.

Macroeconomic, Business, Market and Operational Risks

Adverse worldwide economic or other conditions could reduce the demand for cruises and passenger spending, adversely impacting our operating results, cash flows and financial condition including impairing the value of our goodwill, ships, trademarks and other assets and potentially affecting other critical accounting estimates where the change may be material to our operating results.

In addition to health and safety concerns, demand for cruises is affected by international, national, and local economic conditions. Weak or uncertain economic conditions may impact consumer confidence and pose a risk as vacationers postpone or reduce discretionary spending. This, in turn, may result in cruise booking slowdowns, decreased cruise prices and lower onboard revenues. Given the global nature of our business, we are exposed to many different economies, and our business could be hurt by challenging conditions in any of our markets. Additionally, the continued impact of COVID-19 on the financial markets is uncertain and we cannot predict its effect on geopolitical events and/or international trade policies as countries attempt to mitigate the impact of the pandemic and as they re-open their economies or re-implement lockdown measures.

Our operating costs could increase due to market forces and economic or geopolitical factors beyond our control.

Our operating costs, including fuel, food, payroll and benefits, airfare, taxes, insurance, and security costs, can be and have been subject to increases due to market forces and economic or geopolitical conditions or other factors beyond our control, including global inflationary pressures which have increased our operating costs. In connection with the COVID-19 pandemic, we' have incurred increased operating costs, including as a result of rerouting itineraries due to ports closing or not accepting passengers. Increases in these operating costs could adversely affect our future profitability.

Any further impairment of our goodwill, long-lived assets, equity investments and notes receivable could adversely affect our financial condition and operating results.

We evaluate goodwill for impairment on an annual basis, or more frequently when circumstances indicate that the carrying value of a reporting unit may not be recoverable. A challenging operating environment (such as is currently being experienced due to the impact of COVID-19), conditions affecting consumer demand or spending, the deterioration of general macroeconomic conditions, or other factors could result in a change to the future cash flows we expect to derive from our operations. Reductions of cash flows used in the valuation analyses may result in the recording of impairments, which could adversely affect our financial condition and operating results.

Price increases for commercial airline services for our guests or major changes or reduction in commercial airline services and/or availability could adversely impact the demand for cruises and undermine our ability to provide reasonably priced vacation packages to our guests.

Many of our guests depend on scheduled commercial airline services to transport them to or from the ports where our cruises embark or disembark. Increases in the price of airfare would increase the overall price of the cruise vacation to our guests, which may adversely impact demand for our cruises. In addition, changes in the availability and/or regulations governing commercial airline services, including those resulting from the COVID-19 pandemic, have adversely affected and could continue to adversely affect our guests’ ability to obtain air travel, as well as our ability to transfer our guests to or from our cruise ships, which could adversely affect our results of operations.

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Terrorist attacks, war, and other similar events could have a material adverse impact on our business and results of operations.

We are susceptible to a wide range of adverse events, including terrorist attacks, war, conflicts, civil unrest and other hostilities, such as the outbreak of armed conflict between Russia and Ukraine. The occurrence of these events or an escalation in the frequency or severity of them, and the resulting political instability, travel restrictions and advisories and concerns over safety and security aspects of traveling or the fear of any of the foregoing, have had, and could have in the future, a significant adverse impact on demand and pricing in the travel and vacation industry. These events could also result in additional security measures taken by local authorities which have, and may in the future, impact access to ports and/or destinations. In addition, such events have led, and could lead, to disruptions, instability and volatility in global markets, supply chains and industries, increased operating costs, such as fuel and food, and disruptions affecting our newbuild construction and fleet modernization efforts, any of which could materially and adversely impact our business and results of operations. Further, such events could have the effect of heightening the other risks we have described in this report, any of which also could materially and adversely affect our business and results of operations.

Disease outbreaks and an increase in concern about the risk of illness could adversely impact our business and results of operations.

Disease outbreaks and increased concern related to illness when traveling to, from, and on our ships could cause a drop in demand for cruises, guest cancellations, travel restrictions, an unavailability of ports and/or destinations, cruise cancellations, ship redeployments and an inability to source our crew, provisions or supplies from certain places. In addition, we may be subject to increased concerns that cruises are more susceptible than other vacation alternatives to the spread of infectious diseases such as COVID-19. In response to disease outbreaks, our industry, including our passengers and crew, may be subject to enhanced health and safety requirements in the future which may be costly and take a significant amount of time to implement across our fleet. For example, local governments may establish their own set of rules for self-quarantines and/or require proof of individuals health status or vaccination prior to or upon visiting. The impact of any of these factors could have a material adverse effect on our business and results of operations. In addition, the new operating protocols we are developing and any other health protocol we may develop or that may be required by law in the future in response to infectious diseases may be costly to develop and implement and may be less effective than we expected in reducing the risk of infection and spread of such disease on our cruise ships, all of which will negatively impact our operations and expose us to reputational and legal risks.

Incidents on ships, at port facilities, land destinations and/or affecting the cruise vacation industry in general, and the associated negative media coverage and publicity, have affected and could continue to affect our reputation and impact our sales and results of operations.

Cruise ships, private destinations, port facilities and shore excursions operated and/or offered by us and third parties may be susceptible to the risk of accidents, illnesses, mechanical failures, environmental incidents and other incidents which could bring into question safety, health, security and vacation satisfaction and negatively impact our sales, operations and reputation. Incidents involving cruise ships, and, in particular the safety, health and security of guests and crew and the media coverage thereof, including those related to the COVID-19 pandemic, have impacted and could continue to impact demand for our cruises and pricing in the industry. In particular, we cannot predict the impact on our financial performance and the public’s concern regarding the health and safety of travel, especially by cruise ship, and related decreases in demand for travel and cruising. Moreover, our ability to attract and retain guests and crew depends, in part, upon the perception and reputation of our company and our brands and the public’s concerns regarding the health and safety of travel generally, as well as regarding the cruising industry and our ships specifically. Our reputation and our business could also be damaged by continued or additional negative publicity regarding the cruise industry in general, including publicity regarding the spread of contagious disease such as COVID-19, over-tourism in key ports and destinations and the potentially adverse environmental impacts of cruising. The considerable expansion in the use of social and digital media has compounded the potential scope and reach of any negative publicity. In addition, incidents involving cruise ships may result in additional costs to our business, increasing government or other regulatory oversight and, in certain cases, potential litigation.

Significant weather, climate events and/or natural disasters could adversely impact our business and results of operations.

Natural disasters (e.g., earthquakes, volcanos, wildfires), weather and/or climate events (including hurricanes and typhoons) could impact our source markets and operations resulting in travel restrictions, guest cancellations, an inability to source our crew or our provisions and supplies from certain places. We are often forced to alter itineraries and occasionally cancel a cruise or a series of cruises or to redeploy our ships due to these types of events, which could have an adverse effect on our sales, operating costs and profitability in the current and future periods. Increases in the frequency, severity or duration of these types of events could exacerbate their impact and disrupt our operations or make certain destinations less desirable or

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unavailable impacting our revenues and profitability further. Any of the foregoing could have an adverse impact on our results of operations and on industry performance.

Our sustainability activities, including environmental, social and governance (ESG) matters, could result in reputational risks, increased costs and other risks.

Customers, investors, lenders, regulators and other industry stakeholders have placed increasing importance on corporate ESG practices and on the implications and social cost of their investments, which could cause us to incur additional costs and changes to our operations. If our ESG practices or disclosures do not meet investor or industry stakeholders' evolving expectations and standards, our customer, employee and supply chain vendor retention, and our brands and reputation, may be negatively impacted, which could affect our business operations and financial condition. We could also incur additional costs and require additional resources to monitor, report and comply with various ESG practices, which could increase our operating costs and affect our results of operations and financial condition.

In addition, from time to time, we communicate certain initiatives regarding climate change and other ESG matters. We could fail or be perceived to fail to achieve such initiatives, which may negatively affect our reputation. The future adoption of new technology or processes to achieve the initiatives could also result in the impairment of existing assets.

Our reliance on shipyards, their subcontractors and our suppliers to implement our newbuild and ship upgrade programs and to repair and maintain our ships exposes us to risks which could adversely impact our business.

We rely on shipyards, their subcontractors and our suppliers to effectively construct our new ships and to repair, maintain, and upgrade our existing ships on a timely basis and in a cost effective manner. There are a limited number of shipyards with the capability and capacity to build, repair, maintain and/or upgrade our ships. As such, any disruptions affecting the newbuild or fleet modernization supply chain will adversely impact our business as there are limited substitutes.

The COVID-19 pandemic has led to suspensions and/or slowdowns of work at certain shipyards, which impacts our ability to construct new ships when and as planned, our ability to timely and cost-effectively procure new capacity, and our ability to execute scheduled drydocks and/or fleet modernizations. The effects of the COVID-19 pandemic on the shipyards, their subcontractors, and our suppliers have resulted in delays in our previously scheduled ship deliveries. Variations from our plan could have a significant negative impact on our business operations and financial condition.

Building, repairing, maintaining and/or upgrading a ship is sophisticated work that involves significant risks. Material increases in commodity and raw material prices, and other cost pressures impacting the construction of a new ship, such as the cost of labor and financing, could adversely impact the shipyard’s ability to build the ship on a cost-effective basis. We may be impacted if shipyards, their subcontractors, and/or our suppliers encounter financial difficulties, supply chain, technical or design problems when building or repairing a ship. If materialized, these problems could impact the timely delivery or cost of new ships or the ability of shipyards to repair and upgrade our fleet in accordance with our needs or expectations. In addition, delays, mechanical faults and/or unforeseen incidents may result in cancellation of cruises or delays of new ship orders or necessitate unscheduled drydocks. Such events could result in lost revenue, increased operating expenses, or both, and thus adversely affect our results of operations.

An increase in capacity worldwide or excess capacity in a particular market could adversely impact our cruise sales and/or pricing.

Although our ships can be redeployed, cruise sales and/or pricing may be impacted by the introduction of new ships into the marketplace, reductions in cruise capacity, overall market growth and deployment decisions of ourselves and our competitors. As of March 31, 2022, a total of 76 new ships with approximately 178,000 berths were on order for delivery through 2027 in the cruise industry, including 11 ships currently scheduled to be delivered to us. The further net growth in capacity from these new ships and future orders, without an increase in the cruise industry’s demand and/or share of the vacation market, could depress cruise prices and impede our ability to achieve yield improvement. Further, cruise prices and yield improvement could face additional pressure due to the pace at which we and other cruise line operators return to service.

In addition, to the extent that we or our competitors deploy ships to a particular itinerary/region and the resulting capacity in that region exceeds the demand, it may negatively affect our pricing and profitability. Any of the foregoing could have an adverse impact on our results of operations, cash flows and financial condition, including potentially impairing the value of our ships and other assets

Unavailability of ports of call may adversely affect our results of operations.

We believe that port destinations are a major reason why guests choose to go on a particular cruise or on a cruise vacation. The availability of ports and destinations is affected by a number of factors, including industry demand and competition for key ports and destinations, existing capacity constraints, constraints related to the size of certain ships, security, financial limitations

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on port development, exclusivity arrangements that ports may have with our competitors, geopolitical developments and local governmental regulations. In light of the COVID-19 pandemic, port availability could also be subject to immediate change depending on local and/or onboard disease cases or other government restrictions as well as limited availability during the resumption of operations. Higher fuel costs also may adversely impact the destinations on certain of our itineraries as they become too costly to include.

In addition, certain ports and destinations have faced a surge of both cruise and non-cruise tourism which, in certain cases, has fueled anti-tourism sentiments and related countermeasures to limit the volume of tourists allowed in these destinations. In certain destinations, countermeasures to limit the volume of tourists have been contemplated and/or put into effect, including proposed limits on cruise ships and cruise passengers. Potential restrictions in ports and destinations, such as Venice, Barcelona or Key West, could limit the itinerary and destination options we can offer our passengers going forward.

Increased demand and competition for key ports of call or destinations, limitations on the availability or feasibility of use of specific ports of call and/or constraints on the availability of shore excursions and other service providers at such ports or destinations could adversely affect our operations and financial results.

We may lose business to competitors throughout the vacation market.

We operate in the vacation market and cruising is one of many alternatives for people choosing a vacation. We therefore risk losing business not only to other cruise lines, but also to other vacation operators, which provide other leisure options, including hotels, resorts, internet-based alternative lodging sites and package holidays and tours.

We face significant competition from other cruise lines on the basis of cruise pricing, travel advisor preference and also in terms of the nature of ships, services and destinations that we offer to guests. Our principal competitors within the cruise vacation industry include Carnival Corporation & plc, which owns, among others, Aida Cruises, Carnival Cruise Line, Costa Cruises, Cunard Line, Holland America Line, P&O Cruises, Princess Cruises and Seabourn; Disney Cruise Line; MSC Cruises; and Norwegian Cruise Line Holdings Ltd, which owns Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises. Our revenues are sensitive to the actions of other cruise lines in many areas including pricing, scheduling, capacity and promotions, which can have a substantial adverse impact not only on our revenues, but also on overall industry revenues.

In the event that we do not effectively market or differentiate our cruise brands from our competitors or otherwise compete effectively with other vacation alternatives and new or existing cruise companies, our results of operations and financial position could be adversely affected.

If we are unable to appropriately balance our cost management and capital allocation strategies with our goal of satisfying guest expectations, it may adversely impact our business success.

Our goals are to provide high quality products and deliver high quality services. There can be no assurance that we can successfully balance these goals with our cost management and capital allocation strategies. Our business also requires us to make capital allocation decisions across a broad scope of investment options with varying return profiles and time horizons for value realization. These include significant capital investment decisions such as ordering new ships, upgrading our existing fleet, enhancing our technology and/or data capabilities and expanding our portfolio of land-based assets, based on expected market preferences, competition and projected demand. There can be no assurance that our strategies will be successful, which could adversely impact our business, financial condition and results of operations. For example, our ownership and operation of older tonnage, in particular during the business disruption caused by COVID-19, has resulted in impaired asset values due to expected returns that we will not be able to recover.

Our attempts to expand our business into new markets and new ventures may not be successful.

We opportunistically seek to grow our business through, among other things, expansion into new destinations or source markets and establishment of new ventures complementary to our current offerings. These attempts to expand our business increase the complexity of our business, require significant levels of investment and can strain our management, personnel, operations and systems. In addition, we have been unable to execute our attempts to expand our business as a result of the impacts of the COVID-19 pandemic, as described elsewhere herein. There can be no assurance that these business expansion efforts will develop as anticipated or that we will succeed, and if we do not, we may be unable to recover our investment, which could adversely impact our business, financial condition and results of operations.

Risks associated with our development and operation of key land-based destination projects may adversely impact our business or results of operations.

We have invested, either directly or indirectly through joint ventures and partnerships, in a growing portfolio of key land-based projects including port and terminal facilities, private destinations and multi-brand destination projects. These investments can increase our exposure to certain key risks depending on the scope, location, and the ownership and

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management structure of these projects. These risks include susceptibility to weather events, exposure to local political/regulatory developments and policies, logistical challenges and human resource and labor risks and safety, environmental, and health risks, including challenges posed by the COVID-19 pandemic and its effects locally where we have these projects and relationships.

Our reliance on travel advisors to sell and market our cruises exposes us to certain risks which could adversely impact our business.

We rely on travel advisors to generate bookings for our ships. Accordingly, we must maintain competitive commission rates and incentive structures. If we fail to offer competitive compensation packages or fail to maintain our relationships, these agencies may be incentivized to sell cruises offered by our competitors, which could adversely impact our operating results. Our reliance on third-party sellers is particularly pronounced in certain markets. In addition, the travel advisor community is sensitive to economic conditions that impact discretionary income of consumers. Significant disruptions, such as those caused by the COVID-19 pandemic, or contractions in the industry could reduce the number of travel advisors available for us to market and sell our cruises, which could have an adverse impact on our financial condition and results of operations. Additionally, the strength of our recovery from suspended operations could be delayed if we are not aligned and partnered with key travel advisors.

Business activities that involve our co-investments with third parties may subject us to additional risks.

Partnerships, joint ventures and other business structures involving our co-investments with third parties generally include some form of shared control over the operations of the business and create additional risks, including the possibility that other investors in such ventures become bankrupt or otherwise lack the financial resources to meet their obligations or could have or develop business interests, policies or objectives that are inconsistent with ours. In addition to financial risks, our co-investment activities have also presented managerial and operational risks and expose us to reputational or legal concerns. These or other issues related to our co-investments with third parties could adversely impact our operations or liquidity. Due to the COVID-19 pandemic, Pullmantur S.A. filed for reorganization under the terms of the Spanish insolvency laws. The Company may be required to continue to provide funding for these affiliated entities and it is unclear when and to what extent these entities will fully resume operations and our ability to provide such funding will be limited by the level and terms of our outstanding indebtedness. Further, due to the arrangements we have in place with our partners in these ventures, we are limited in our ability to control the strategy of these ventures if and when they resume operations, or their use of capital and other key factors to their results of operation which could adversely affect our investments and impact our results of operations.

Past or pending business acquisitions or potential acquisitions that we may decide to pursue in the future carry inherent risks which could adversely impact our financial performance and condition.

The Company, from time to time, has engaged in acquisitions and may pursue acquisitions in the future, which are subject to, among other factors, the Company’s ability to identify attractive business opportunities and to negotiate favorable terms for such opportunities. Accordingly, the Company cannot make any assurances that potential acquisitions will be completed timely or at all, or that if completed, we would realize the anticipated benefits of such acquisitions. Acquisitions also carry inherent risks such as, among others: (i) the potential delay or failure of our efforts to successfully integrate business processes and realizing expected synergies; (ii) difficulty in aligning procedures, controls and/or policies; and (iii) future unknown liabilities and costs that may be associated with an acquisition. In addition, acquisitions may adversely impact our liquidity and/or debt levels, and the recognized value of goodwill and other intangible assets can be negatively affected by unforeseen events and/or circumstances, which may result in an impairment charge. Any of the foregoing events could adversely impact our financial condition and results of operations.

We rely on supply chain vendors and third-party service providers who are integral to the operations of our businesses. These vendors and service providers are also affected by COVID-19 and may be unable or unwilling to deliver on their commitments or may act in ways that could harm our business.

We rely on supply chain vendors to deliver key products to the operations of our businesses around the world. Any event impacting a vendor’s ability to deliver goods of the expected quality at the location and time needed could negatively impact our ability to deliver our cruise experience. Events impacting our supply chain could be caused by factors beyond the control of our suppliers or us, including inclement weather, natural disasters, new laws and regulations, labor actions, increased demand, problems in production or distribution and/or disruptions in third-party logistics or transportation systems, including those caused by the COVID-19 pandemic. Any such interruptions to our supply chain could increase our costs and could limit the availability of products critical to our operations.

In order to achieve cost and operational efficiencies, we outsource to third-party vendors certain services that are integral to the operations of our global businesses, such as our onboard concessionaires, certain of our call center operations, guest port services, logistics distribution and operation of a large part of our information technology systems, all of which are also affected

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by the COVID-19 pandemic. We are subject to the risk that certain decisions are subject to the control of our third-party service providers and that these decisions may adversely affect our activities. A failure to adequately monitor a third-party service provider’s compliance with a service level agreement or regulatory or legal requirements could result in significant economic and reputational harm to us. There is also a risk the confidentiality, privacy and/or security of data held by third parties or communicated over third-party networks or platforms could become compromised.

The potential unavailability of insurance coverage, an inability to obtain insurance coverage at commercially reasonable rates or our failure to have coverage in sufficient amounts to cover our incurred losses may adversely affect our financial condition or results of operations.

We seek to maintain appropriate insurance coverage at commercially reasonable rates. We normally obtain insurance based on the cost of an asset rather than replacement value, and we also elect to self-insure, co-insure, or use deductibles in certain circumstances for certain risks such as loss of use of a ship or other business interruption. The limits of insurance coverage we purchase are based on the availability of the coverage, evaluation of our risk profile and cost of coverage. We do not carry business interruption insurance and accordingly we have no insurance coverage for loss of revenues or earnings from our ships or other operations. Accordingly, we are not protected against all risks and cannot be certain that our coverage will be adequate for liabilities actually incurred which could result in an unexpected decrease in our revenue and results of operations in the event of an incident

We are members of four Protection and Indemnity (“P&I”) clubs, which are part of a worldwide group of 13 P&I clubs, known as the International Group of P&I Clubs (the “IG”). P&I coverage provided by the clubs is on a mutual basis, and we are subject to additional premium calls in the event of a catastrophic loss incurred by any member of the 13 P&I clubs, whereby the reinsurance limits purchased by the IG are exhausted. We are also subject to additional premium calls based on investment and underwriting shortfalls experienced by our own individual insurers. Certain liabilities, costs, and expenses associated with COVID-19 cases identified on or traced to our vessels are eligible for insurance coverage under our participation in these P&I clubs

We cannot be certain that insurance and reinsurance coverage will be available to us and at commercially reasonable rates in the future or at all or, if available, that it will be sufficient to cover potential claims. Additionally, if we or other insureds sustain significant losses, the result may be higher insurance premiums, cancellation of coverage, or the inability to obtain coverage. The COVID-19 pandemic, for example, depending on its duration and the associated insurance claims volumes, may potentially impact the insurance markets we rely on for coverage and could adversely impact both the coverage options available to us in the future as well as the premium costs we are required to pay for those coverages. Such events could adversely affect our financial condition or results of operations.

Disruptions in our shoreside or shipboard operations or our information systems may adversely affect our results of operations.

Our principal executive office and principal shoreside operations are located in Florida, and we have shoreside offices throughout the world. Actual or threatened natural disasters (e.g., hurricanes/typhoons, earthquakes, tornadoes, fires or floods), municipal lockdowns, curfews, quarantines, or similar events in these locations may have a material impact on our business continuity, reputation and results of operations. In addition, substantial or repeated information system failures, computer viruses or cyber attacks impacting our shoreside or shipboard operations could adversely impact our business. We do not generally carry business interruption insurance for our shoreside or shipboard operations or our information systems. As such, any losses or damages incurred by us could have an adverse impact on our results of operations.

Provisions of our Articles of Incorporation, By-Laws and Liberian law could inhibit a change of control and may prevent efforts by our shareholders to change our management.

Certain provisions of our Articles of Incorporation and By-Laws and Liberian law may inhibit third parties from effectuating a change of control of the Company without approval from our board of directors which could result in the entrenchment of current management. These include provisions in our Articles of Incorporation that prevent third parties, other than A. Wilhelmsen AS and Cruise Associates and their permitted transferees, from acquiring beneficial ownership of more than 4.9% of our outstanding shares without the consent of our board of directors.

Compliance and Regulatory Risks

Changes in U.S. or other countries’ foreign travel policy have affected, and may continue to affect our results of operations.

Changes in U.S. foreign policy have in the past and could in the future result in the imposition of travel restrictions or travel bans on U.S. persons to certain countries or result in the imposition of travel advisories, warnings, rules, regulations or legislation exposing us to penalties or claims of monetary damages. In addition, some countries have adopted restrictions

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against U.S. travelers, and we currently cannot predict when those restrictions will be eased. The timing and scope of these changes and regulations can be unpredictable, and they could cause us to cancel scheduled sailings, possibly on short notice, or could result in litigation against us. This, in turn, could decrease our revenue, increase our operating costs and otherwise impair our profitability.

Environmental, labor, health and safety, financial responsibility and other maritime regulations and measures could affect operations and increase operating costs.

The U.S. and various state and foreign government or regulatory agencies have enacted or may enact environmental regulations or policies, such as requiring the use of low sulfur fuels (e.g., IMO 2020), that could increase our direct cost to operate in certain markets, increase our cost of fuel, limit the supply of compliant fuel, cause us to incur significant expenses to purchase and/or develop new equipment and adversely impact the cruise vacation industry. While we have taken and expect to continue to take a number of actions to mitigate the potential impact of certain of these regulations, there can be no assurances that these efforts will be successful over the long term.

There is increasing global regulatory focus on climate change, greenhouse gas and other emissions. These regulatory efforts, both internationally and in the U.S., are still developing, and we cannot yet determine what the final regulatory programs or their impact will be. However, such climate change-related regulatory activity in the future may adversely affect our business and financial results by requiring us to reduce our emissions, purchase allowances or otherwise pay for our emissions and may increase our exposure, if any, to climate change-related litigation. Such activity may also impact us by increasing our operating costs, including fuel costs.

In addition, we are subject to various international, national, state and local laws, regulations and treaties that govern, among other things, discharge from our ships, safety standards applicable to our ships, treatment of disabled persons, health and sanitary standards applicable to our guests, security standards on board our ships and at the ship/port interface areas, and financial responsibilities to our guests. These issues are, and we believe will continue to be, an area of focus by the relevant authorities throughout the world. This could result in the enactment of more stringent regulation of cruise ships that could subject us to increasing compliance costs in the future and may increase our exposure, if any, to environmental-related litigation.

Some environmental groups also have generated negative publicity about the environmental impact of the cruise vacation industry and are advocating for more stringent regulation of ship emissions at berth and at sea. Growing environmental scrutiny of the cruise industry and any related measures could adversely impact our operations and financial results and subject us to reputational impacts and costs.

A change in our tax status under the U.S. Internal Revenue Code, or other jurisdictions, may have adverse effects on our results of operations.

Royal Caribbean Cruises Ltd. and a number of our subsidiaries are foreign corporations that derive income from a U.S. trade or business and/or from sources within the U.S. In connection with the year end audit, each year, Faegre Drinker Biddle & Reath LLP, our U.S. tax counsel, delivers to us an opinion, based on certain representations and assumptions set forth in it, to the effect that this income, to the extent derived from or incidental to the international operation of a ship or ships, is excluded from gross income for U.S. federal income tax purposes pursuant to Section 883 of the Internal Revenue Code. We believe that most of our income (including that of our subsidiaries) is derived from or incidental to the international operation of ships.

Our ability to rely on Section 883 could be challenged or could change in the future. Provisions of the Internal Revenue Code, including Section 883, are subject to legislative change at any time. Moreover, changes could occur in the future with respect to the identity, residence or holdings of our direct or indirect shareholders, trading volume or trading frequency of our shares, or relevant foreign tax laws of Liberia or the Bahamas, such that they no longer qualify as equivalent exemption jurisdictions, that could affect our eligibility for the Section 883 exemption. Accordingly, there can be no assurance that we will continue to be exempt from U.S. income tax on U.S. source shipping income in the future. If we were not entitled to the benefit of Section 883, we and our subsidiaries would be subject to U.S. taxation on a portion of the income derived from or incidental to the international operation of our ships, which would reduce our net income.

Additionally, portions of our business are operated by companies that are within the United Kingdom tonnage tax regime. Further, some of our operations are conducted in jurisdictions where we rely on tax treaties to provide exemption from taxation. To the extent the United Kingdom tonnage tax laws change or we do not continue to meet the applicable qualification requirements or if tax treaties are changed or revoked, we may be required to pay higher income tax in these jurisdictions, adversely impacting our results of operations.

As budgetary constraints continue to adversely impact the jurisdictions in which we operate, increases in income tax regulations, tax audits or tax reform affecting our operations may be imposed.

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We are not a U.S. corporation and, as a result, our shareholders may be subject to the uncertainties of a foreign legal system in protecting their interests.

Our corporate affairs are governed by our Articles of Incorporation and By-Laws and by the Business Corporation Act of Liberia. The provisions of the Business Corporation Act of Liberia resemble provisions of the corporation laws of a number of states in the U.S. However, there are very few judicial cases in Liberia interpreting the Business Corporation Act of Liberia. While the Business Corporation Act of Liberia provides that it is to be applied and construed to make the laws of Liberia, with respect of the subject matter of the Business Corporation Act of Liberia, uniform with the laws of the State of Delaware and other states with substantially similar legislative provisions (and adopts their case law to the extent it is non-conflicting), there have been few Liberian court cases interpreting the Business Corporation Act of Liberia, and we cannot predict whether Liberian courts would reach the same conclusions as United States courts. We understand that legislation has been proposed but not yet adopted by the Liberian legislature which amends the provisions regarding the adoption of non-Liberian law to, among other things, provide for the adoption of the statutory and case law of Delaware and not also states with substantially similar legislative provisions, and potentially provide the courts of Liberia discretion in application of non-statutory corporation law of Delaware in cases when the laws of Liberia are silent. The right of shareholders to bring a derivative action in Liberian courts may be more limited than in U.S. jurisdictions. There may also be practical difficulties for shareholders attempting to bring suit in Liberia, and Liberian courts may or may not recognize and enforce foreign judgments. Thus, our shareholders may have more difficulty challenging actions taken by management, directors or controlling shareholders than would shareholders of a corporation incorporated in a U.S. jurisdiction.

General Risk Factors

Conducting business globally may result in increased costs and other risks.

We operate our business globally, which exposes us to a number of risks, including increased exposure to a wider range of regional and local economic conditions, volatile local political conditions, potential changes in duties and taxes, including changing and/or uncertain interpretations of existing tax laws and regulations, required compliance with additional laws and policies affecting cruising, vacation or maritime businesses or governing the operations of foreign-based companies, currency fluctuations, interest rate movements, difficulties in operating under local business environments, port quality and availability in certain regions, U.S. and global anti-bribery laws and regulations, imposition of trade barriers and restrictions on repatriation of earnings.

Our future growth strategies increasingly depend on the growth and sustained profitability of international markets. Factors that will be critical to our success in these markets include our ability to continue to raise awareness of our products and our ability to adapt our offerings to best suit rapidly evolving consumer demands. This risk is further heightened by the COVID-19 pandemic, as authorities in many of these markets have implemented numerous measures to contain the spread and impact of COVID-19, such as travel bans and restrictions, shelter-in-place/stay-at-home orders, and other limitations on business activity, including business closures. In addition, these measures could change unpredictably and/or could be scaled up or down in response to evolving intensity or resurgence of COVID-19 and related variants in or around these markets. The execution of our planned growth strategies is dependent on meeting the governmental and regulatory measures and policies in each of these markets. Our ability to realize our future growth strategy is highly dependent on our ability to satisfy country-specific policies and requirements in order to return to service, as well as meet the needs of region-specific consumer preferences as services come back online. These factors may cause us to reevaluate some of our international business strategies.

Operating globally also exposes us to numerous and sometimes conflicting legal, regulatory and tax requirements. In many parts of the world, including countries in which we operate, practices in the local business communities might not conform to international business standards. These legal and regulatory requirements and standards may change in response to the COVID-19 pandemic, and there may be greater uncertainty as to the interpretation and enforcement of applicable laws and regulations, including those introduced in response to the COVID-19 pandemic. We cannot guarantee consistent interpretation, application, and enforcement of rules and regulations put in place in response to the COVID-19 pandemic, which could place limits on our operations or increase our costs, as well as negatively impact our future growth strategies in our key growth markets. We must adhere to policies designed to promote legal and regulatory compliance as well as applicable laws and regulations. However, we might not be successful in ensuring that our employees, agents, representatives and other third parties with whom we associate properly adhere to applicable laws and regulations. In addition, we may be exposed to the risk of penalties and other liabilities if we fail to comply with all applicable legal and regulatory requirements introduced in response to the COVID-19 pandemic, which may be subject to frequent and rapid change. Failure by us, our employees or any of these third parties to adhere to our policies or applicable laws or regulations could result in penalties, sanctions, damage to our reputation and related costs, which in turn could negatively affect our results of operations and cash flows.

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As a global operator, our business also may be impacted by changes in U.S. policy or priorities in areas such as trade, immigration (including any continuation of any of the immigration policies put in place by the U.S. government in response to the COVID-19 pandemic) and/or environmental or labor regulations, among others. Depending on the nature and scope of any such changes, they could impact our domestic and international business operations. Any such changes, and any international response to them, could potentially introduce new barriers to passenger or crew travel and/or cross border transactions, impact our guest experience and/or increase our operating costs.

If we are unable to address these risks adequately, our financial position and results of operations could be adversely affected, including impairing the value of our ships and other assets.

The terms of our existing debt financing gives, and any future preferred equity or debt financing may give, holders of any preferred securities or debt securities rights that are senior to rights of our common shareholders.

The holders of our existing debt have rights, preferences and privileges senior to those of holders of our common stock in the event of liquidation. If we incur additional debt or raise equity through the issuance of preferred stock or convertible securities, the terms of the debt or the preferred stock issued may give the holders rights, preferences and privileges senior to those of holders of our common stock, particularly in the event of liquidation. If we raise funds through the issuance of additional equity, the ownership percentage of our existing shareholders would be diluted.

Fluctuations in foreign currency exchange rates, fuel prices and interest rates could affect our financial results.

We are exposed to market risk attributable to changes in foreign currency exchange rates, fuel prices and interest rates. Significant changes in any of the foregoing could have a material impact on our financial results, net of the impact of our hedging activities and natural offsets. Our operating results have been and will continue to be impacted, often significantly, by changes in each of these factors

A portion of our indebtedness bears interest at variable rates that are linked to changing market interest rates. As a result, an increase in market interest rates would increase our interest expense and our debt service obligations. As of March 31, 2022, we had approximately $6.5 billion of indebtedness that bears interest at variable rates. This amount represented approximately 28.4% of our total indebtedness. As of March 31, 2022, a hypothetical 1% increase in prevailing interest rates would increase our forecasted 2022 interest expense by approximately $29.4 million.

Additionally, the value of our earnings in foreign currencies is adversely impacted by a strong U.S. dollar. In addition, any significant increase in fuel prices could materially and adversely affect our business as fuel prices impact not only our fuel costs, but also some of our other expenses, such as crew travel, freight, and commodity prices. Mandatory fuel restrictions may also create uncertainty related to the price and availability of certain fuel types potentially impacting operating costs and the value of our related hedging instruments.

The loss of key personnel, our inability to recruit or retain qualified personnel, or disruptions among our shipboard personnel could adversely affect our results of operations.

Our success depends, in large part, on the skills and contributions of key executives and other employees and on our ability to recruit, develop and retain high quality personnel as well as having adequate succession plans and back-up operating plans for when critical executives are unable to serve. As demand for qualified personnel in the industry grows, we must continue to effectively recruit, train, motivate and retain our employees, both shoreside and on our ships, in order to effectively compete in our industry, maintain our current business and support our projected global growth.

We are experiencing difficulty in recruiting and retaining qualified personnel as a result of COVID-19, the reduction in our workforce during our suspension of cruise operations, general macroeconomic conditions and a competitive labor market. Our ability to rehire crew may be negatively impacted by increasing demands related to our health and safety protocols, including vaccine requirements, and by a reduced labor supply as previous crew may have obtained alternative employment during our suspension of cruise operations. A prolonged shortage of qualified personnel and/or increased turnover could decrease our ability to operate our business in an optimal manner. The shortage and competitive labor market may result in increased costs if we need to hire temporary personnel, and/or increased wages and/or benefits in order to attract and retain employees, all of which may negatively impact our results of operations.

As of March 31, 2022, approximately 85% of our shipboard employees were covered by collective bargaining agreements. A dispute under our collective bargaining agreements could result in a work stoppage of those employees covered by the agreements. We may not be able to satisfactorily renegotiate these collective bargaining agreements when they expire. In addition, existing collective bargaining agreements may not prevent a strike or work stoppage on our ships. We may also be subject to or affected by work stoppages unrelated to our business or collective bargaining agreements. Any such work

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stoppages or potential work stoppages could have a material adverse effect on our financial results, as could a loss of key employees, our inability to recruit or retain qualified personnel or disruptions among our personnel.

If we are unable to keep pace with developments in technology, including technology in response to the COVID-19 pandemic, our operations or competitive position could become impaired.

Our business continues to demand the use of sophisticated technology and systems. These technologies and systems require significant investment and must be proven, refined, updated, upgraded and/or replaced with more advanced systems in order to continue to meet our customers’ demands and expectations. If we are unable to do so in a timely manner or within reasonable cost parameters or if we are unable to appropriately and timely train our employees to operate any of these new systems, our business could suffer. We also may not achieve the benefits that we anticipate from any new technology or system, which could result in higher than anticipated costs or impair our operating results.

In response to COVID-19, we have relied on technology to assist with mitigating the risk of COVID-19 for our passengers and crew. For example, we have deployed our patented eMuster technology across our fleet in an effort to minimize congregate settings onboard. Additionally, on certain vessels we have deployed our patented contact tracing technology in an effort to quickly identify close contacts of cases onboard. As this technology continues to develop we may be faced with technical constraints or development decisions. We may be unable to obtain appropriate technology in a timely manner or at all or we may incur significant costs in doing so. A failure to adopt the appropriate technology, or a failure or obsolescence in the technology that we do adopt, could adversely affect our results of operations.

We are exposed to cyber security attacks and data breaches and the risks and costs associated with protecting our systems and maintaining data integrity and security.

We are subject to cyber security attacks. These cyber attacks can vary in scope and intent from attacks with the objective of compromising our systems, networks, and communications for economic gain or with the objective of disrupting, disabling or otherwise compromising our maritime and/or shoreside operations. The attacks can encompass a wide range of methods and intent, including phishing attacks, illegitimate requests for payment, theft of intellectual property, theft of confidential or non-public information, installation of malware, installation of ransomware and theft of personal or business information. The frequency and sophistication of, and methods used to conduct, these attacks, have increased over time.

A successful cyber security attack may target us directly, or it may be the result of a third party’s inadequate care, or resulting from vulnerabilities in licensed software. In either scenario, the Company may suffer damage to its systems and data that could interrupt our operations, adversely impact our brand reputation, and expose us to increased risks of governmental investigation, litigation, fines, and other liability, any of which could adversely affect our business. Furthermore, responding to such an attack and mitigating the risk of future attacks could result in additional operating and capital costs in technology, personnel, monitoring and other investments.

We are also subject to various risks associated with the collection, handling, storage, and transmission of sensitive information. In the regular course of business, we collect employee, customer, and other third-party data, including personally identifiable information and individual payment data, for various business purposes. Although we have policies and procedures in place to safeguard such sensitive information, this information has been and could be subject to cyber security attacks and the aforementioned risks. In addition, we are subject to federal, state, and international laws relating to the collection, use, retention, security and transfer of personally identifiable information and individual payment data. Those laws include, among others, the European Union General Data Protection Regulation and regulations of the New York State Department of Financial Services and similar state agencies that impose additional cyber security requirements as a result of our provision of certain insurance products. Complying with these and other applicable laws has caused, and may cause, us to incur substantial costs or require us to change our business practices, and our failure to do so may expose us to substantial fines, penalties, restrictions, litigation, or other expenses and adversely affect our business. Further, any changes to laws or regulations, including new restrictions or requirements applicable to our business, or an increase in enforcement of existing laws and regulations, could expose us to additional costs and liability and could limit our use and disclosure of such information.

While we continue to evolve our cyber security practices in line with our business’ reliance on technology and the changing external threat landscape, and we invest time, effort and financial resources to secure our systems, networks and communications, our security measures cannot provide absolute assurance that we will be successful in preventing or defending from all cyber security attacks impacting our operation. There can be no assurance that any breach or incident will not have a material impact on our operations and financial results.

Any breach, theft, loss, or fraudulent use of guest, employee, third-party or company data, could adversely impact our reputation and brand and our ability to retain or attract new customers, and expose us to risks of data loss, business disruption, governmental investigation, litigation and other liability, any of which could adversely affect our business. Significant capital investments and other expenditures could be required to remedy the problem and prevent future breaches, including costs

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associated with additional security technologies, personnel, experts and credit monitoring services for those whose data has been breached. Further, if we or our vendors experience significant data security breaches or fail to detect and appropriately respond to significant data security breaches, we could be exposed to government enforcement actions and private litigation.

Litigation, enforcement actions, fines or penalties could adversely impact our financial condition or results of operations and/or damage our reputation.

Our business is subject to various U.S. and international laws and regulations that could lead to enforcement actions, fines, civil or criminal penalties or the assertion of litigation claims and damages. In addition, improper conduct by our employees, agents or joint venture partners could damage our reputation and/or lead to litigation or legal proceedings that could result in civil or criminal penalties, including substantial monetary fines. In certain circumstances it may not be economical to defend against such matters and/or our legal strategy may not ultimately result in us prevailing in a matter. Such events could lead to an adverse impact on our financial condition or results of operations. In addition, we have experienced, and may continue to experience, increases in litigation pertaining to the COVID-19 crisis, including potential claims for non-refundable cash deposits. We cannot predict the quantum or outcome of any such proceedings and the impact that they will have on our financial results, but any such impact may be material. While some of these claims are covered by insurance, we cannot be certain that all of them will be, which could have an adverse impact on our financial condition or results of operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Share Repurchases

The following table provides information about our repurchase of common stock during the quarter ended March 31, 2022.

There were no repurchases of common stock during the quarter ended March 31, 2022. In connection with our debt covenant waivers, we agreed with our lenders not to engage in stock repurchases for so long as our debt covenant waivers are in effect. In addition, in the event we engage in share repurchases, we will need to repay the amounts deferred under our export credit facilities.

Period	Total number of shares purchased (1)	Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs	Approximate dollar value of shares that may yet be purchased under the plans or programs
January 1, 2022 - January 31,2022	—	—		—	$	—
February 1, 2022 - February 28, 2022	135,398	16.77		—	$	—
March 1, 2022 - March 31, 2022	—	—		—	$	—
Total	135,398	$	16.77

(1) Includes shares related to employee stock plans; primarily 106,965 performance shares issued that did not vest as the performance criteria was not met and were repurchased at par value of $0.01 per share. Additionally, shares were withheld by us to cover withholding taxes due at the election of certain holders.

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Item 6. Exhibits

3.1	Amended and Restated By-laws (incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed on February 11, 2022).
4.1	Indenture, dated March 29, 2021, among the Company and The Bank of New York Mellon Trust Company, N.A., as trustee, principal paying agent, transfer agent, registrar and security agent (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on March 30, 2021).
10.1	Hull L34 Credit Agreement, dated as of July 24, 2017, as novated, amended and restated on the Actual Delivery Date pursuant to a Novation Agreement, dated as of July 24, 2017, by and between Royal Caribbean Cruises Ltd., Citibank N.A., SMBC Bank International plc, Citibank Europe plc, and the banks and financial institutions as lender parties thereto*
31.1	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934*
31.2	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934*
32.1	Certifications of the Chief Executive Officer and the Chief Financial Officer pursuant to Rule 13a-14(b) of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63 of Title 18 of the United States Code**

*	Filed herewith
**	Furnished herewith

Interactive Data File

101                         The following financial statements of Royal Caribbean Cruises Ltd. for the period ended March 31, 2022, formatted in iXBRL (Inline extensible Reporting Language) are filed herewith:

(i)                     the Consolidated Statements of Comprehensive Income (Loss) for the quarter ended March 31, 2022 and 2021;

(ii)    the Consolidated Balance Sheets at March 31, 2022 and December 31, 2021;

(iii)                the Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021; and

(iv)                   the Notes to the Consolidated Financial Statements, tagged in summary and detail.

104      Cover page interactive data file (the cover page XBRL tags are embedded within the Inline XBRL document).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	ROYAL CARIBBEAN CRUISES LTD.
	(Registrant)
	/s/ NAFTALI HOLTZ
	Naftali Holtz
	Chief Financial Officer
May 5, 2022	(Principal Financial Officer and duly authorized signatory)

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EX-10.1

Exhibit 10.1

HULL NO. L34 CREDIT AGREEMENT

dated 24 July 2017 as novated, amended and restated on the Actual Delivery Date pursuant to a novation agreement dated 24 July 2017 (as amended and restated by a first novation agreement supplement dated 12 March 2020, as amended by a second novation agreement supplement dated 29 August 2020, as further amended and restated by a third novation agreement supplement dated 13 November 2020 and as further amended and restated by a fourth novation agreement supplement dated     July 2021)

BETWEEN

Royal Caribbean Cruises Ltd. as the Borrower,

the Lenders from time to time party hereto,

Citibank N.A., London Branch as Global Coordinator

SMBC Bank International plc as ECA Agent and

Citibank Europe plc, UK Branch as Facility Agent and

Citibank N.A., London Branch, Banco Santander, S.A., Paris Branch, BNP Paribas, HSBC Continental Europe, Société Générale and SMBC Bank International plc as Mandated Lead Arrangers

TABLE OF CONTENTS

PAGE

	Article I DEFINITIONS AND ACCOUNTING TERMS
Section 1.1.Defined Terms	2
Section 1.2.Use of Defined Terms	27
Section 1.3.Cross-References	27
Section 1.4.Accounting and Financial Determinations	27
	Article II COMMITMENTS AND BORROWING PROCEDURES
Section 2.1.Commitment	28
Section 2.2.Commitment of the Lenders; Termination and Reduction of Commitments	28
Section 2.3.Borrowing Procedure	29
Section 2.4.Funding	30
	Article III REPAYMENTS, PREPAYMENTS, INTEREST AND FEES
Section 3.1.Repayments	30
Section 3.2.Prepayment.	31
Section 3.3.Interest Provisions	32
Section 3.4.Commitment Fees	34
	Article IV CERTAIN EURO RATE AND OTHER PROVISIONS
Section 4.1.EURO Rate Lending Unlawful	35
Section 4.2.Deposits Unavailable	35
Section 4.3.Increased EURO Rate Loan Costs, etc.	36
Section 4.4.Funding Losses	38
Section 4.5.Increased Capital Costs	39
Section 4.6.Taxes	40
Section 4.7.Reserve Costs	42
Section 4.8.Payments, Computations, etc.	42
Section 4.9.Replacement Lenders, etc.	43
Section 4.10.Sharing of Payments	44
Section 4.11.Set-off	45
Section 4.12.Use of Proceeds	45

i

Section 4.13.FATCA Information	45
Section 4.14.Resignation of the Facility Agent	46
	Article V CONDITIONS TO BORROWING
Section 5.1.Advance of the Loan	47
	Article VI REPRESENTATIONS AND WARRANTIES
Section 6.1.Organization, etc.	50
Section 6.2.Due Authorization, Non-Contravention, etc.	50
Section 6.3.Government Approval, Regulation, etc.	51
Section 6.4.Compliance with Environmental Laws	51
Section 6.5.Validity, etc.	51
Section 6.6.No Default, Event of Default or Prepayment Event	51
Section 6.7.Litigation	51
Section 6.8.The Purchased Vessel	51
Section 6.9.Obligations rank pari passu; Liens	52
Section 6.10.Withholding, etc.	52
Section 6.11.No Filing, etc. Required	52
Section 6.12.No Immunity	52
Section 6.13.Investment Company Act	52
Section 6.14.Regulation U	52
Section 6.15.Accuracy of Information	53
Section 6.16.Compliance with Laws	53
	Article VII COVENANTS
Section 7.1.Affirmative Covenants	53
Section 7.2.Negative Covenants	59
Section 7.3.Covenant Replacement.	73
Section 7.4.Lender incorporated in the Federal Republic of Germany	73
	Article VIII EVENTS OF DEFAULT
Section 8.1.Listing of Events of Default	74
Section 8.2.Action if Bankruptcy	76
Section 8.3.Action if Other Event of Default	76

ii

	Article IX PREPAYMENT EVENTS
Section 9.1.Listing of Prepayment Events	76
Section 9.2.Mandatory Prepayment	78
Section 9.3.Mitigation	79
	Article X THE FACILITY AGENT AND THE ECA AGENT
Section 10.1.Actions	79
Section 10.2.Indemnity	79
Section 10.3.Funding Reliance, etc.	80
Section 10.4.Exculpation	81
Section 10.5.Successor	82
Section 10.6.Loans by the Facility Agent	83
Section 10.7.Credit Decisions	83
Section 10.8.Copies, etc.	83
Section 10.9.The Agents’ Rights	83
Section 10.10.The Facility Agent’s Duties	84
Section 10.11.Employment of Agents	84
Section 10.12.Distribution of Payments	84
Section 10.13.Reimbursement	84
Section 10.14.Instructions	85
Section 10.15.Payments	85
Section 10.16.“Know your customer” Checks	85
Section 10.17.No Fiduciary Relationship	85
Section 10.18.Illegality	85
	Article XI MISCELLANEOUS PROVISIONS
Section 11.1.Waivers, Amendments, etc.	86
Section 11.2.Notices	87
Section 11.3.Payment of Costs and Expenses	88
Section 11.4.Indemnification	88
Section 11.5.Survival	90
Section 11.6.Severability	90
Section 11.7.Headings	90
Section 11.8.Execution in Counterparts, Effectiveness, etc.	90

iii

Section 11.9.Third Party Rights	90
Section 11.10.Successors and Assigns	90
Section 11.11.Sale and Transfer of the Loan; Participations in the Loan	90
Section 11.12.Other Transactions	94
Section 11.13.BpiFAE Insurance Policy	94
Section 11.14.Law and Jurisdiction	96
Section 11.15.Confidentiality	96
Section 11.16.French Authority Requirements	97
Section 11.17.Waiver of immunity	97
Section 11.18.Acknowledgement and Consent to Bail-In of EEA Financial Institutions	98

iv

EXHIBITS

Exhibit A - Form of Loan Request

Exhibit B-1 - Form of Opinion of Liberian Counsel to Borrower

Exhibit B-2 - Form of Opinion of English Counsel to the Facility Agent and the Lenders

Exhibit B-3 - Form of Opinion of French Counsel to the Facility Agent and the Lenders

Exhibit B-4 - Form of Opinion of US Tax Counsel to the Lenders

Exhibit C - Form of Lender Assignment Agreement

Exhibit D - Form of Certificate of French Content

Exhibit E-1 - Form of Delivery Non-Yard Costs Certificate

Exhibit E-2 - Form of Final Non-Yard Costs Certificate

Exhibit F - Silversea Indebtedness and Liens

Exhibit G - Form of First Priority Guarantee

Exhibit H - Form of Second Priority Guarantee

Exhibit I - Form of Third Priority Guarantee

Exhibit J - Form of Senior Parties Subordination Agreement

Exhibit K - Form of Other Senior Parties Subordination Agreement

Exhibit L – Framework

Exhibit M – Debt Deferral Extension Regular Monitoring Requirements

Exhibit N – Replacement covenants with effect from the Guarantee Release Date

v

CREDIT AGREEMENT

HULL NO. L34 CREDIT AGREEMENT, dated 24 July 2017 as novated, amended and restated on the Actual Delivery Date (as defined below), and as amended and restated by a first novation agreement supplement dated 12 March 2020, and as further amended by a second novation agreement supplement dated 29 August 2020, and as further amended and restated by a third novation agreement supplement dated 13 November 2020, and as further novated and restated by a fourth novation agreement supplement dated          July 2021 is among Royal Caribbean Cruises Ltd., a Liberian corporation (the “Borrower”), SMBC Bank International plc in its capacity as agent for the Lenders referred to below in respect of BpiFAE-related matters (in such capacity, the “ECA Agent”), Citibank Europe plc, UK Branch in its capacity as facility agent (in such capacity, the “Facility Agent”) and the financial institutions listed in Schedule 1 to the Novation Agreement (as defined below) as lenders (in such capacity, together with each of the other Persons that shall become a “Lender” in accordance with clause 12 of the Novation Agreement or Section 11.11.1 hereof, each of them individually a “Lender” and, collectively, the “Lenders”).

W I T N E S E T H:

WHEREAS,

(A)    The Borrower and Chantiers de l’Atlantique (previously known as STX France S.A.) (the “Builder”) have entered on 16 February 2015 into a Contract for the Construction and Sale of Hull No. L34 (as amended from time to time, the “Construction Contract”) pursuant to which the Builder has agreed to design , construct, equip, complete, sell and deliver the passenger cruise vessel bearing Builder’s hull number L34 which shall be owned by the Nominated Owner (the “Purchased Vessel”);

(B)    The Lenders have agreed to make available to the Borrower, upon the terms and conditions contained herein, a Euro loan facility calculated on the amount (the “Maximum Loan Amount”) equal to the EUR sum of:

(i)    eighty per cent (80%) of the Contract Price (as defined below) of the Purchased Vessel, and including Non-Yard Costs of up to EUR 76,000,000 (the “Maximum Non-Yard Costs Amount”) and the Other Basic Contract Price Increases (as defined below) for the Purchased Vessel of up to EUR 10,000,000 (but which, when aggregated with the Non-Yard Costs, shall not exceed an amount equal to EUR 76,000,000), and all of which amounts shall not exceed in aggregate EUR 707,167,000;

(ii)    eighty per cent (80%) of the change orders of up to EUR 123,116,700 effected in accordance with the Construction Contract; and

(iii)    100% of the BpiFAE Premium (as defined below), being an amount no greater than EUR 684,153,769;

(C)    Of the amounts referred to in recital (B)(i) and (ii) above, the Lenders have made certain amounts available to the Original Borrower during the period prior to the Actual Delivery Date pursuant to this Agreement (the liability for which amount has been assumed by the Borrower following the novation of this Agreement pursuant to the Novation Agreement) and, in relation to the amount referred to in recital (B)(i), the balance has been or shall be made available to the Borrower as an Additional Advance pursuant to the Novation Agreement and this Agreement.

(D)    The Parties have previously amended this Agreement pursuant to the Third Novation Agreement Supplement (as defined below) in connection with the provision of the Guarantees (as defined below).

NOW, THEREFORE, the parties hereto agree as follows:

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ARTICLE I

DEFINITIONS AND ACCOUNTING TERMS

SECTION 1.1.    DEFINED TERMS. The following terms (whether or not underscored) when used in this Agreement, including its preamble and recitals, shall, when capitalized, except where the context otherwise requires, have the following meanings (such meanings to be equally applicable to the singular and plural forms thereof):

“Accumulated Other Comprehensive Income (Loss)” means at any date the Borrower’s accumulated other comprehensive income (loss) on such date, determined in accordance with GAAP.

“Actual Delivery Date” means the date on which the Purchased Vessel is delivered by the Builder to, and accepted by, the Borrower under the Construction Contract, being also the date on which the final balance of the Loan is advanced by way of the Additional Advances.

“Additional Advances” is defined in the Novation Agreement.

“Additional Guarantee” means a guarantee of the Obligations provided by a New Guarantor in a form and substance substantially the same as the other Guarantees (reflecting any necessary logical and factual changes), with such changes, or otherwise in a form and substance, reasonably acceptable to the Facility Agent and acceptable to BpiFAE.

“Additional Subordination Agreement” means any subordination agreement with respect to the Second Priority Guarantee or the Third Priority Guarantee, as applicable, in a form and substance substantially the same as the other Subordination Agreements (reflecting any necessary logical and factual changes), with such changes, or otherwise in a form and substance, reasonably acceptable to the Facility Agent and the beneficiaries of any Indebtedness incurred by the relevant Guarantor, as applicable, and acceptable to BpiFAE.

“Adjustable Amount” means, as of any time of determination, $500,000,000; provided if the aggregate amount of New Capital is equal to or greater than $500,000,000, then the Adjustable Amount shall be $350,000,000.

“Adjusted Cash Balance”means, as of any date (the “Measurement Date”), the aggregate amount of unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries as determined in accordance with GAAP plus (a) any amounts available to be drawn by the Borrower and/or any of its Subsidiaries under committed but undrawn term loan or revolving credit facility agreements (excluding any amounts available under agreements where the proceeds are only intended to be used to fund the purchase of new Vessels) and less (b) the sum of (i) any scheduled payments of principal or interest (but for the purposes of anticipating any interest liabilities, the interest rate of any floating rate debt shall be determined based on reference rates then in effect at the Measurement Date) in respect of debt during the period commencing on the Measurement Date and ending on the date that is six months thereafter, (ii) any customer deposits held by the Borrower or its Subsidiaries for cruises that are scheduled to commence within three months of the Measurement Date and (iii) any planned Non-Financed Capex during the period commencing on the Measurement Date and ending on the date that is six months thereafter.

“Adjusted EBITDA After Principal and Interest” means, for any Last Reported Fiscal Quarter, the Borrower’s EBITDA After Principal and Interest for such period, excluding those items, if any, that the Borrower has excluded in determining “Adjusted Net Income” for such period as disclosed in the Borrower’s annual report on 10-K or quarterly report on 10-Q, as applicable, for such Last Reported Fiscal Quarter, as evidenced pursuant to the relevant certificate to be submitted by the Borrower pursuant to Section 7.1.1(l).

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“Affiliate” of any Person means any other Person which, directly or indirectly, controls, is controlled by or is under common control with such Person. A Person shall be deemed to be “controlled by” any other Person if such other Person possesses, directly or indirectly, power to direct or cause the direction of the management and policies of such Person whether by contract or otherwise.

“Agent” means either the ECA Agent or the Facility Agent and “Agents” means both of them.

“Agreement” means, on any date, this credit agreement as originally in effect on the Signing Date and as novated, amended and restated by the Novation Agreement and as thereafter from time to time amended, supplemented, amended and restated, or otherwise modified and in effect on such date.

“Annex VI” means Annex VI of the Protocol of 1997 (as subsequently amended from time to time) to amend the International Convention for the Prevention of Pollution from Ships 1973 (Marpol), as modified by the Protocol of 1978 relating thereto.

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Affiliates from time to time concerning or relating to bribery or corruption.

“Anticipated Delivery Date” means the Expected Delivery Date (as defined in the Receivable Purchase Agreement) as at the Signing Date, namely 21 October 2021.

“Applicable Commitment Rate” means (x) from the Signing Date up to and including the date falling two years prior to the Anticipated Delivery Date, 0.15% per annum, (y) from the day following the date falling two years prior to the Anticipated Delivery Date up to and including the date falling one year prior to the Anticipated Delivery Date, 0.28% per annum, and (z) from the day following the date falling one year prior to the Anticipated Delivery Date until the Commitment Fee Termination Date, 0.33% per annum.

“Applicable Jurisdiction” means the jurisdiction or jurisdictions under which the Borrower is organized, domiciled or resident or from which any of its business activities are conducted or in which any of its properties are located and which has jurisdiction over the subject matter being addressed.

“Approved Appraiser” means any of the following: Barry Rogliano Salles, Paris, H Clarkson & Co. Ltd., London, R.S. Platou Shipbrokers, Norway, or Fearnley AS, Norway.

“Assignee Lender” is defined in Section 11.11.1.

“Authorized Officer” means those officers of the Borrower authorized to act with respect to the Loan Documents and whose signatures and incumbency shall have been certified to the Facility Agent by the Secretary or an Assistant Secretary of the Borrower.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” means: (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule; and (b) in relation to any state other than such an EEA Member Country or (to the extent that the United Kingdom is not such an EEA Member Country) the United Kingdom, any analogous law or regulation from time to time which requires contractual recognition of any Write-down and Conversion Powers contained in that law or regulation.

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“Bank Indebtedness” means the Borrower’s Indebtedness up to a maximum aggregate principal amount of $5,300,000,000 under the following agreements (as amended, restated, supplemented, extended, refinanced, replaced or otherwise modified from time to time): (a) the USD1,550,000,000 revolving credit facility maturing in 2022 with Nordea Bank AB (publ), New York Branch as agent, (b) the USD1,925,000,000 revolving credit facility maturing in 2024 with The Bank of Nova Scotia as agent, (c) the USD1,000,000,000 term loan maturing on 5 April 2022 with Bank of America, N.A. as agent, (d) the USD300,000,000 term loan maturing on 7 June 2028 with Nordea Bank ABP, New York Branch as agent, (e) the USD55,827,065 term loan maturing on 5 December 2022 with Sumitomo Mitsui Banking Corporation as agent, (f) the €80,000,000 term loan maturing in November 2024 with Skandinaviska Enskilda Banken AB (publ) as agent, (g) the USD130,000,000 term loan maturing on 2 February 2023 with Industrial and Commercial Bank of China Limited, New York Branch as agent, (h) that certain guarantee dated 18 July 2016 with SMBC Leasing and Finance, Inc. as agent in connection with liabilities relating to the “Lease”, the “Construction Agency Agreement”, the “Participation Agreement” and any other “Operative Document” (as each term is defined in such guarantee) and (i) any other agreement (other than in connection with Credit Card Obligations) as to which the Second Priority Guarantors provide a first priority guarantee package.

“Bank of Nova Scotia Agreement” means the U.S. $1,925,000,000 amended and restated credit agreement dated as of 4 December 2017 among the Borrower, as borrower, the various financial institutions as are or shall become parties thereto, as lenders, and The Bank of Nova Scotia, as administrative agent, as amended, restated, supplemented or otherwise modified from time to time.

“Basic Contract Price” is as defined in the Construction Contract. “Borrower” is defined in the preamble.

“BpiFAE” means BpiFrance Assurance Export, the French export credit agency, a French société par action simplifiée à associé unique with its registered office at 27-31, avenue du Général Leclerc, 94710 Maisons-Alfort Cedex, France, registered at the trade and companies registry of Créteil under number 815 276 308 and includes its successors in title or any other person succeeding to BpiFrance Assurance Export in the role as export credit agency of the Republic of France to manage and provide under its control, on its behalf and in its name the public export guarantees as provided by article L 432-1 of the French insurance code.

“BpiFAE Enhanced Guarantee” means the enhanced guarantee (garantie rehaussée) issued or to be issued by BpiFAE to the benefit of CAFFIL in accordance with article 84 of the French Amending Finance Law 2012 (as amended) in relation to the refinancing of SFIL’s participation and Commitments under the Loan, and any other documents (including any security) entered into or to be entered into by SFIL with CAFFIL and/or BpiFAE in relation thereto.

“BpiFAE Insurance Policy” means the export credit insurance policy in respect of the Loan issued by BpiFAE for the benefit of the Lenders.

“BpiFAE Premium” means the premium payable to BpiFAE under and in respect of the BpiFAE Insurance Policy.

“Builder” is defined in the preamble.

“Business Day” means any day which is neither a Saturday or Sunday nor a legal holiday on which banks are authorized or required to be closed in New York City, London, Madrid or Paris and (in relation to any date for payment or purchase of Euro) any TARGET Day, and if the applicable Business Day relates to an advance of all or part of the Loan, an Interest Period, prepayment or conversion, in each case with respect to the Loan bearing

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interest by reference to the EURO Rate, a day on which dealings in deposits in Euros are carried on in the interbank market within the Participating Member States.

“B34 Facility Amendment Date” means 20 March 2018, the effective date of the third supplemental agreement dated 16 March 2018 to (among other things) a credit facility supported by BpiFAE (pertaining to Hull No. B34) reflecting the alignment of certain provisions and covenants with the Borrower’s revolving credit facility refinanced on 12 October 2017.

“CAFFIL” means Caisse Française de Financement Local, a French société anonyme, with its registered office at 1-3 rue du Passeur de Boulogne, 92130 Issy-les- Moulineaux, France, registered at the trade and companies registry of Nanterre under number 421 318 064.

“Capital Lease Obligations” means obligations of the Borrower or any Subsidiary of the Borrower under any leasing or similar arrangement which, in accordance with GAAP, would be classified as capitalized leases.

“Capitalization” means, at any date, the sum of (a) Net Debt on such date, plus (b) Stockholders’ Equity on such date.

“Capitalized Lease Liabilities” means the principal portion of all monetary obligations of the Borrower or any of its Subsidiaries under any leasing or similar arrangement which, in accordance with GAAP, would be classified as capitalized leases, and, for purposes of this Agreement and each other Loan Document, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP.

“Cash Equivalents” means all amounts other than cash that are included in the “cash and cash equivalents” shown on the Borrower’s balance sheet prepared in accordance with GAAP.

“Change of Control” means an event or series of events by which (a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, but excluding any employee benefit plan of such person or its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a person or group shall be deemed to have “beneficial ownership” of all securities that such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time (such right, an “option right”)), directly or indirectly, of 50% or more of the equity securities of the Borrower entitled to vote for members of the board of directors or equivalent governing body of the Borrower on a fully-diluted basis (and taking into account all such securities that such person or group has the right to acquire pursuant to any option right); or (b) during any period of 24 consecutive months, a majority of the members of the board of directors or other equivalent governing body of the Borrower cease to be composed of individuals (i) who were members of that board or equivalent governing body on the first day of such period, (ii) whose election or nomination to that board or equivalent governing body was approved by individuals referred to in clause (i) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body or (iii) whose election or nomination to that board or other equivalent governing body was approved by individuals referred to in clauses (i) and (ii) above constituting at the time of such election or nomination at least a majority of that board or equivalent governing body.

“CIRR” means 0.74% per annum being the Commercial Interest Reference Rate determined in accordance with the OECD Arrangement for Officially Supported Export Credits to be applicable to the Loan hereunder.

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“Code” means the Internal Revenue Code of 1986, as amended, reformed or otherwise modified from time to time.

“Commitment” is defined in Section 2.2 and means, relative to any Lender, such Lender’s obligation to make the Loan pursuant to Section 2.1.

“Commitment Fees” is defined in Section 3.4.

“Commitment Fee Termination Date” is defined in Section 3.4.

“Commitment Termination Date” means the Back Stop Date (as defined in the Receivable Purchase Agreement) (or such later date as the Lenders and BpiFAE may agree).

“Construction Contract” is defined in the preamble.

“Contract Price” is as defined in the Construction Contract and which includes a lump sum amount in respect of the Non-Yard Costs.

“Contractual Delivery Date” means, at any time, the date which at such time is the date specified for delivery of the Purchased Vessel under the Construction Contract, as such date may be modified from time to time pursuant to the terms of the Construction Contract.

“Covenant Modification Date” means the later to occur of (a) the expiry of the Financial Covenant Waiver Period and (b) the date upon which the financial covenants set out in Section 7.2.4 have been modified in this Agreement in a form and substance satisfactory to BpiFAE, the Borrower and the Lenders.

“Covered Taxes” is defined in Section 4.6.

“Credit Card Obligations” means any obligations of the Borrower under credit card processing arrangements or other similar payment processing arrangements entered into in the ordinary course of business of the Borrower.

“DDTL Indebtedness” means the Borrower’s Indebtedness (or, if such Indebtedness has not yet been incurred, the commitments by lenders to provide Indebtedness to the Borrower as of the effectiveness of the Third Novation Agreement Supplement) in connection with that certain Commitment Letter, dated as of August 12, 2020, between the Borrower and MORGAN STANLEY SENIOR FUNDING INC. (as amended, restated, extended, supplemented, refinanced, replaced or otherwise modified from time to time).

“Debt Deferral Extension Regular Monitoring Requirements" means the general test scheme/reporting package in the form set out in Exhibit M to this Agreement submitted or to be submitted (as the case may be) by the Borrower in accordance with Section 7.1.1(i).

“Debt Incurrence” means any incurrence of Indebtedness for borrowed money by any Group Member, whether pursuant to a public offering or a Rule 144A or other private placement of debt securities (including any secured debt securities (but excluding any unsecured debt securities) convertible into equity securities) or an incurrence of loans under any loan or credit facility, or any issuance of bonds, other than:

(a)    any Indebtedness (but having regard, in respect of any secured and/or guaranteed Indebtedness, to the restrictions set out in Section 7.2.9(b)) incurred by a Group Member between 1 April 2020 and the earlier of (i) the end of the Early Warning Monitoring Period and (ii) 31 December 2023 (or such later date as may, with the prior consent of BpiFAE, be agreed between the Borrower and the Lenders) (the “Debt Incurrence Trigger Date”);

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(b)    Indebtedness incurred by a Group Member pursuant to an intra-Group loan from another Group Member, provided that no Group Member shall be permitted to incur any such Indebtedness at any time where an Event of Default or a Prepayment Event has occurred and is continuing;

(c)    Indebtedness incurred to refinance (and for this purpose having regard to the applicable provisions of Section 7.2.9) a maturity payment under any existing loan or credit facility (including any crisis and/or recovery-related Indebtedness incurred by a Group Member prior to the Debt Incurrence Trigger Date) or issued bonds of a Group Member, provided that;

(i)    in the case of any such refinancing, the amount of such Indebtedness being used in connection with that refinancing does not increase the aggregate principal amount of such Indebtedness or the commitments outstanding at the time of that refinancing and is otherwise incurred on a basis permitted pursuant to this Agreement (including, without limitation, in relation to the provision of any Liens or guarantees that may be provided to support the relevant refinancing arrangement); and

(ii)    in the case of the refinancing of crisis and/or recovery-related Indebtedness of the type referred to above, that refinancing shall either (A) reduce the interest burden of the Borrower (and for such purposes the interest rate of any floating rate debt shall be determined based on reference rates then in effect at the time of the new debt incurrence) or (B) replace the existing secured and/or guaranteed Indebtedness with unsecured and unguaranteed debt;

(d)    Indebtedness provided by banks or other financial institutions under the Borrower’s senior unsecured revolving credit facilities in an aggregate amount not greater than the commitments thereunder as in effect on 19 February 2021 plus the amount of any existing uncommitted incremental facilities (i.e. any unused accordion) on such facilities;

(e)    Indebtedness provided by banks or other financial institutions which, as at 19 February 2021, is committed but yet to be incurred in respect of the DDTL Indebtedness (but, in respect of that DDTL Indebtedness, up to a maximum amount of $700,000,000);

(f)    any of the following types of indebtedness in each case incurred in the ordinary course of business of any Group Member and with the prior written consent of BpiFAE:

(i)    the issuances of commercial paper;

(ii)    Capitalized Lease Liabilities;

(iii)    purchase money indebtedness;

(iv)    indebtedness under overdraft facilities; and

(v)    financial obligations in connection with repurchase agreements and/or securities lending arrangements; and

(g)    vessel financings (including the financing of pre-delivery contract installments, change orders, owner furnished equipment costs or other such similar arrangements) in respect of vessels for which shipbuilding contracts have been executed on or prior to 28 April 2020 (provided, however, that a refinancing of a vessel financing shall not be included in this carve-out (g)).

“Default” means any Event of Default or any condition, occurrence or event which, after notice or lapse of time or both, would constitute an Event of Default.

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“Delivery Non-Yard Costs Certificate” means the certificate to be provided to the Facility Agent in the form of Exhibit E-1 on or prior to the Actual Delivery Date certifying the amount in EUR and/or Dollars, as applicable, of the Paid Non-Yard Costs and the Unpaid Non-Yard Costs as at the Actual Delivery Date, duly signed by the Borrower and endorsed by the Builder.

“Dispose” means to sell, transfer, license, lease, distribute or otherwise transfer, and “Disposition” shall have a correlative meaning.

"Disruption Event" means either or both of:

(a)    a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Loan (or otherwise in order for the transactions contemplated by the Loan Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the parties; or

(b)    the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a party preventing that, or any other, party:

(i)    from performing its payment obligations under the Loan Documents; or

(ii)    from communicating with other parties or in accordance with the terms of the Loan Documents,

and which (in either such case) is not caused by, and is beyond the control of, the party whose operations are disrupted.

“Dollar” and the sign “$” mean lawful money of the United States.

“Early Warning Monitoring Period” means the period beginning on the Novation Effective Time and ending on the last day of two consecutive Fiscal Quarters in which the Borrower has achieved a higher Adjusted EBITDA After Principal and Interest for such Fiscal Quarters when compared with the same calculation for the corresponding Fiscal Quarters of the 2019 Fiscal Year, as evidenced pursuant to the certificate to be submitted by the Borrower pursuant to Section 7.1.1(l) (and such date shall be notified to the Borrower by the Facility Agent).

“EBITDA After Principal and Interest” means, for any Last Reported Fiscal Quarter, the Borrower’s consolidated operating income for such period plus any depreciation and amortization expenses that were deducted in calculating consolidated operating income for such period and minus (a) any scheduled amortization or maturity payments made during such period and (b) consolidated interest expense of the Borrower for such period (net of any capitalized interest and interest income), in each relevant case as determined in accordance with GAAP.

“ECA Agent” is defined in the preamble.

“ECA Financed Vessel” means any Vessel subject to any ECA Financing.

“ECA Financing” means any financing arrangement pursuant to which one or more ECA Guarantor provides guarantees or other credit support (including but not limited to a sale and leaseback transaction or bareboat charter or lease or an arrangement whereby a Vessel under construction is pledged as collateral to secure the indebtedness of a shipbuilder, and, for the avoidance of doubt, committed but undrawn export credit agency facilities), entered into by the Borrower or a Subsidiary for the purpose of financing or refinancing all or

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any part of the purchase price, cost of design or construction of a Vessel or Vessels or the acquisition of Equity Interests of entities owning, or to own, Vessels.

“ECA Guarantor” means BpiFrance Assurance Export, Finnvera plc or Euler Hermes Aktiengesellschaft (or, in each case, any successor thereof).

“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of a Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“Effective Date” means the date this Agreement becomes effective pursuant to Section 11.8.

“Effective Time” means the Novation Effective Time as defined in the Novation Agreement.

“Environmental Laws” means all applicable federal, state, local or foreign statutes, laws, ordinances, codes, rules and regulations (including consent decrees and administrative orders) relating to the protection of the environment.

“Equity Interests” means, with respect to any Person, all of the shares, interests, rights, participations or other equivalents (however designated) of capital stock of (or other ownership or profit interests or units in) such Person and all of the warrants, options or other rights for the purchase, acquisition or exchange from such Person of any of the foregoing (including through convertible securities) but excluding any debt securities convertible into such Equity Interests.

“Escrow Account” means the Euro escrow account of the Borrower opened or to be opened with the Escrow Account Bank for the purpose of receiving the relevant amount of the Additional Advances in respect of Unpaid Non-Yard Costs in accordance with Section 2.3f).

“Escrow Account Bank” means Citibank N.A., London Branch of Citigroup Centre, Canada Square, Canary Wharf, London E14 5LB.

“Escrow Account Security” means the account security in respect of the Escrow Account executed or, as the context may require, to be executed by the Borrower in favour of the Security Trustee in the form agreed by the Lenders and the Borrower on or about the Restatement Date.

“Escrow Agency and Trust Deed” means the agency and trust deed executed or, as the context may require, to be executed by, amongst others, the Borrower, the parties to this Agreement and the Security Trustee.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“EUR”, “Euro” and the sign “€” mean the currency of participating member states of the European Monetary Union pursuant to Council Regulation (EC) 974/98 of 3 May 1998, as amended from time to time.

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“EURO Rate” means the rate per annum of the offered quotation for deposits in Euros for six months (or for such other period as shall be agreed by the Borrower and the Facility Agent) which appears on Thomson Reuters EURIBOR01 Page (or any successor page) at or about 11:00 a.m. (Central European Time) two (2) TARGET Days (and which are also days on which banks are open for business in London (excluding Saturdays, Sundays and legal holidays)) before the commencement of the relevant Interest Period; provided that:

a)    subject to Section 3.3.6, if no such offered quotation appears on Thomson Reuters EURIBOR01 Page (or any successor page) at the relevant time the EURO Rate shall be the Historic Screen Rate or, if it is not possible to calculate an Historic Screen Rate, it shall be the rate per annum certified by the Facility Agent to be the average of the rates quoted by the Reference Banks as the rate at which each of the Reference Banks was (or would have been) offered deposits of Euros by prime banks in the interbank market within the Participating Member States in an amount approximately equal to the amount of the Loan and for a period of six months;

b)    for the purposes of determining the post-maturity rate of interest under Section 3.3.4, the EURO Rate shall be determined by reference to deposits on an overnight or call basis or for such other period or periods as the Facility Agent may determine after consultation with the Lenders, which period shall be no longer than one month unless the Borrower otherwise agrees; and

c)    if that rate is less than zero, the EURO Rate shall be deemed to be zero. “Event of Default” is defined in Section 8.1.

“Existing Principal Subsidiaries” means each Subsidiary of the Borrower that is a Principal Subsidiary on the Signing Date.

“Facility Agent” is defined in the preamble and includes each other Person as shall have subsequently been appointed as the successor Facility Agent, and as shall have accepted such appointment, pursuant to Section 10.5.

“FATCA” means (a) Sections 1471 through 1474 of the Code, as in effect at the date hereof, and any current or future regulations promulgated thereunder or official interpretations thereof, (b) any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above; or (c) any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.

“FATCA Deduction” means a deduction or withholding from a payment under a Loan Document required by FATCA.

“FATCA Exempt Party” means a party to this Agreement that is entitled to receive payments free from any FATCA Deduction.

“Fee Letter” means any letter entered into by reference to this Agreement between any or all of the Facility Agent, the Mandated Lead Arrangers, the Arrangers, the Lenders and/or the Borrower setting out the amount of certain fees referred to in, or payable in connection with, this Agreement.

“Final Maturity” means twelve (12) years after the Actual Delivery Date.

“Final Non-Yard Costs Certificate” means the certificate to be provided to the Facility Agent in the form of Exhibit E-2 on or prior to the NYC Cut Off Date certifying the amount of the Paid Non-Yard Costs as at the date of that certificate, duly signed by the Borrower.

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“Financial Covenant Waiver Period” means the period from and including the Novation Effective Time to and including 30 September 2022.

“First Novation Agreement Supplement” means the supplemental agreement dated 12 March 2020 and made between, amongst others, the Original Borrower and the parties hereto, pursuant to which the Novation Agreement was amended and restated.

“First Priority Assets” means the Vessels known on the date the Third Novation Agreement Supplement becomes effective as or that sailed under the name (i) Celebrity Constellation, (ii) Celebrity Equinox, (iii) Celebrity Millennium, (iv) Celebrity Silhouette, (v) Celebrity Summit, (vi) Celebrity Eclipse, (vii) Celebrity Infinity, (viii) Celebrity Reflection and (ix) Celebrity Solstice (it being understood that such Vessels shall remain “First Priority Assets” regardless of any change in name or ownership after such date).

“First Priority Guarantee” means the first priority guarantee granted by the First Priority Guarantor prior to the Effective Time (and any other first priority guarantee granted by a First Priority Holdco Subsidiary in connection with becoming a First Priority Guarantor) in favor of the Facility Agent for the benefit of the Agents and the Lenders, in each case substantially in the form attached hereto as Exhibit G.

“First Priority Guarantor” means Celebrity Cruise Lines Inc. (and any of its successors) and any other First Priority Holdco Subsidiary that has granted or, prior to that entity becoming a First Priority Holdco Subsidiary pursuant to a Disposal of a First Priority Asset in accordance with Section 7.2.5(a)(v)(A), will grant a First Priority Guarantee.

“First Priority Holdco Subsidiaries” means one or more Subsidiaries of the Borrower that directly own any of the Equity Interests issued by any other Subsidiary of the Borrower that owns any First Priority Assets.

“First Priority Release Event” means the occurrence of any event or other circumstance that results in either (x) 80% of the aggregate principal amount of Bank Indebtedness outstanding as of the effectiveness of the Third Novation Agreement Supplement (being $5,300,000,000 (and 80% of which is $4,240,000,000)) or (y) 100% of the aggregate principal amount of Secured Note Indebtedness outstanding as of the effectiveness of the Third Novation Agreement Supplement (being $3,320,000,000):

a)    no longer remaining outstanding (whether as a result of repayment, redemption or otherwise (but excluding in connection with any enforcement action taken by the relevant creditors in respect of that Indebtedness)); and

b)    not having been refinanced (whether initially or through subsequent refinancings) with Indebtedness that is (i) secured by a Lien or (ii) incurred or guaranteed by any one or more Subsidiaries of the Borrower.

Notwithstanding the foregoing, a First Priority Release Event shall in no case occur if the Borrower has failed to pay any Indebtedness that is outstanding under any ECA Financing (including this Agreement) when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise). For the avoidance of doubt, if a First Priority Release Event would have occurred but for the continuance of the payment default described above, then a First Priority Release Event will occur immediately upon that payment default being remedied.

“Fiscal Quarter” means any quarter of a Fiscal Year.

“Fiscal Year” means any annual fiscal reporting period of the Borrower.

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“Fixed Charge Coverage Ratio” means, as of the end of any Fiscal Quarter, the ratio computed for the period of four consecutive Fiscal Quarters ending on the close of such Fiscal Quarter of:

i.    net cash from operating activities (determined in accordance with GAAP) for such period, as shown in the Borrower’s consolidated statement of cash flow for such period, to

ii.    the sum of:

1.    dividends actually paid by the Borrower during such period (including, without limitation, dividends in respect of preferred stock of the Borrower); plus

2.    scheduled payments of principal of all debt less New Financings (determined in accordance with GAAP, but in any event including Capitalized Lease Liabilities) of the Borrower and its Subsidiaries for such period.

“Fixed Rate” means a rate per annum equal to the sum of the CIRR plus the Fixed Rate Margin.

“Fixed Rate Margin” means 0.54% per annum.

“Floating Rate” means a rate per annum equal to the sum of the EURO Rate plus the Floating Rate Margin.

“Floating Rate Margin” means, for each Interest Period 0.69% per annum.

“Fourth Novation Agreement Supplement” means the supplemental agreement dated         July 2021 and made between, amongst others, the Original Borrower, the Security Trustee and the parties hereto, pursuant to which the Novation Agreement was amended in connection with the Framework.

“Fourth Supplement Effective Date” has the meaning ascribed to the term “Amendment Effective Date” in the Fourth Novation Agreement Supplement.

“Framework” means the document titled “Debt Deferral Extension Framework” in the form set out in Exhibit L to this Agreement, and which sets out certain key principles and parameters and being applicable to BpiFAE-covered loan agreements such as this Agreement.

“F.R.S. Board” means the Board of Governors of the Federal Reserve System or any successor thereto.

“French Authorities” means the Direction Générale du Trésor of the French Ministry of Economy and Finance, any successors thereto, or any other governmental authority in or of France involved in the provision, management or regulation of the terms, conditions and issuance of export credits including, among others, such entities to whom authority in respect of the extension or administration of export financing matters have been delegated, such as BpiFAE and Natixis DAI.

“Funding Losses Event” is defined in Section 4.4.1. “GAAP” is defined in Section 1.4.

“Government-related Obligations” means obligations of the Borrower or any Subsidiary of the Borrower under, or Indebtedness incurred by the Borrower or any Subsidiary of the Borrower to satisfy obligations under, any governmental requirement imposed by any Applicable Jurisdiction that must be complied with to enable the Borrower

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and its Subsidiaries to continue their business in such Applicable Jurisdiction, excluding, in any event, any taxes imposed on the Borrower or any Subsidiary of the Borrower.

“Group” means the Borrower and its Subsidiaries from time to time.

“Group Member” means any entity that is a member of the Group.

“Group Member Guarantee” means any guarantee or other similar or analogous credit support arrangement granted by a Group Member (other than the Borrower) in support of the Indebtedness of another Group Member or any other Person.

“Guarantee” means the First Priority Guarantee, the Second Priority Guarantee, the Third Priority Guarantee and (if applicable) any Additional Guarantee and “Guarantees” means any or all of them.

“Guarantee Release Date” means the date upon which the First Priority Release Event, the Second Priority Release Event and the Third Priority Release Event have all occurred and accordingly, subject to Section 7.2.5(g) (and in particular proviso (2) to such Section 7.2.5(g)) each of the Guarantees has been released by the Facility Agent, and also being the date upon which, in accordance with Section 7.3, certain provisions of this Agreement shall be replaced by the provisions set out in Exhibit N, and if such date falls prior to the Novation Effective Time, the Guarantee Release Date shall be deemed to occur at the Novation Effective Time.

“Guarantor” means the provider of any Guarantee from time to time and “Guarantors” means any or all of them.

“Hedging Instruments” means options, caps, floors, collars, swaps, forwards, futures and any other agreements, options or instruments substantially similar thereto or any series or combination thereof used to hedge interest, foreign currency and commodity exposures.

“herein”, “hereof”, “hereto”, “hereunder” and similar terms contained in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document, as the case may be, as a whole and not to any particular Section, paragraph or provision of this Agreement or such other Loan Document.

“Historic Screen Rate” means, in relation to the Loan, the most applicable recent rate which appeared on Thomson Reuters EURIBOR 01 Page (or any replacement page) for the currency of the Loan and for a period equal to the applicable Interest Period for the Loan and which is no more than 7 days before the commencement of the applicable Interest Period for which such rate may be applicable.

“Illegality Notice” is defined in Section 3.2(b).

“Indebtedness” means, for any Person: (a) obligations created, issued or incurred by such Person for borrowed money (whether by loan, the issuance and sale of debt securities or the sale of property to another Person subject to an understanding or agreement, contingent or otherwise, to repurchase such property from such Person); (b) obligations of such Person to pay the deferred purchase or acquisition price of property or services, other than (i) trade accounts payable (other than for borrowed money) arising, and accrued expenses incurred, in the ordinary course of business so long as such trade accounts payable are payable within 180 days of the date the respective goods are delivered or the respective services are rendered and (ii) any purchase price adjustment, earnout or deferred payment of a similar nature incurred in connection with an acquisition (but only to the extent that no payment has at the time accrued pursuant to such purchase price adjustment, earnout or deferred payment obligation); (c) Indebtedness of others secured by a Lien on the property of such Person, whether or not the respective Indebtedness so secured has been assumed by such Person; (d) obligations of such Person in respect of letters of credit or similar instruments issued or accepted by banks and

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other financial institutions for the account of such Person; (e) Capital Lease Obligations of such Person; (f) guarantees by such Person of Indebtedness of others, up to the amount of Indebtedness so guaranteed; (g) obligations of such Person in respect of surety bonds and similar obligations; and (h) liabilities arising under Hedging Instruments.

“Indemnified Liabilities” is defined in Section 11.4.

“Indemnified Parties” is defined in Section 11.4.

“Interest Payment Date” means each Repayment Date.

“Interest Period” means the period between the Actual Delivery Date and the first Repayment Date, and subsequently each succeeding period between two consecutive Repayment Dates.

“Interest Stabilisation Agreement” means an agreement on interest stabilisation entered into between Natixis and each Lender (other than BpiFAE or CAFFIL as assignee of all or any of SFIL’s rights as Lender following the enforcement of any security granted pursuant to paragraph (iv) of Section 11.11.1 in connection with the BpiFAE Enhanced Guarantee, subject as provided in Section 11.11.1) in connection with the Loan.

“Investment Grade” means, with respect to Moody’s, a Senior Debt Rating of Baa3 or better and, with respect to S&P, a Senior Debt Rating of BBB- or better.

“Last Reported Fiscal Quarter(s)” means the most recently completed Fiscal Quarter(s) for which the Borrower has filed financial statements with the SEC as part of an annual report on Form 10-Q or a quarterly report on Form 10-Q.

“Lender Assignment Agreement” means any Lender Assignment Agreement substantially in the form of Exhibit C.

“Lender” and “Lenders” are defined in the preamble.

“Lending Office” means, relative to any Lender, the office of such Lender designated as such below its signature hereto or designated in a Lender Assignment Agreement or such other office of a Lender as designated from time to time by notice from such Lender to the Borrower and the Facility Agent, whether or not outside the United States but subject in all cases to the agreement of Natixis DAI in relation to the CIRR, which shall be making or maintaining the Loan of such Lender hereunder.

“Lien” means any security interest, mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or otherwise), charge against or interest in property to secure payment of a debt or performance of an obligation or other priority or preferential arrangement of any kind or nature whatsoever.

“Lien Basket Amount” is defined in Section 7.2.3(b).

“Loan” means the advances made by the Lenders under this Agreement from time to time or, as the case may be, the aggregate outstanding amount of such advances from time to time.

“Loan Documents” means this Agreement, the Novation Agreement, the First Novation Agreement Supplement, the Second Novation Agreement Supplement, the Third Novation Agreement Supplement, the Fourth Novation Agreement Supplement, the Escrow Agency and Trust Deed, the First Priority Guarantee, the Second Priority Guarantee, the Third Priority Guarantee, any Additional Guarantee, the Subordination Agreement, any Additional Subordination Agreement, any New Guarantor Subordination Agreement, the Fee

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Letters and the Escrow Account Security and any other document designated as a Loan Document by the Borrower and the Facility Agent.

“Loan Request” means the loan request and certificate duly executed by an Authorized Officer of the Borrower, substantially in the form of Exhibit A hereto.

“Material Adverse Effect” means a material adverse effect on (a) the business, operations or financial condition of the Borrower and its Subsidiaries taken as a whole, (b) the rights and remedies of the Facility Agent or any Lender under the Loan Documents or (c) the ability of the Borrower to perform its payment Obligations under the Loan Documents to which it is a party.

“Material Guarantor” means (i) each of Celebrity Cruise Lines Inc., RCI Holdings LLC, RCL Cruise Holdings LLC and RCL Cruises Ltd (and each of their respective successors) and (ii) any other entity that becomes a First Priority Guarantor, a Second Priority Guarantor or a Third Priority Guarantor after the effectiveness of the Third Novation Agreement Supplement.

“Material Litigation” is defined in Section 6.7.

“Maximum Loan Amount” is defined in the preamble.

“Maximum Non-Yard Costs Amount” is defined in the preamble.

“Monthly Outflow” means, in respect of each monthly period, the quotient obtained by dividing:

a)    the sum of (i) Total Cruise Operating Expenses (as determined in accordance with GAAP) for the Last Reported Fiscal Quarter, (ii) Marketing, Selling and Administrative Expenses (as determined in accordance with GAAP) for the Last Reported Fiscal Quarter and (iii) Interest Expense, net of Interest Capitalized (as determined in accordance with GAAP) for the Last Reported Fiscal Quarter minus (x) Interest Income (as determined in accordance with GAAP) for the Last Reported Fiscal Quarter, (y) any non-cash charges or impairments included in the calculation of Total Cruise Operating Expenses or Marketing, Selling and Administrative Expenses pursuant to sub-clause (i) or (ii) of this definition and (z) any loss on extinguishment of debt included in Interest Expenses, net of Interest Capitalized (as each such capitalized expression is defined or referenced in the financial statements of the Borrower); by

b)    three,

as evidenced pursuant to the relevant certificate to be submitted by the Borrower pursuant to Section 7.1.1(l).

“Moody’s” means Moody’s Investors Service, Inc.

“Natixis” means Natixis, a French société anonyme with its registered office at 30, avenue Pierre Mendès France, 75013 Paris, France, registered with the Paris Commercial and Companies Registry under number 542 044 524 RCS Paris.

“Natixis DAI” means Natixis DAI Direction des Activités Institutionnelles.

“Net Debt” means, at any time, the aggregate outstanding principal amount of all debt (including, without limitation, the principal portion of all capitalized leases) of the Borrower and its Subsidiaries (determined on a consolidated basis in accordance with GAAP) less the sum of (without duplication);

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i.    all cash on hand of the Borrower and its Subsidiaries; plus

ii.    all Cash Equivalents.

“Net Debt to Capitalization Ratio” means, as at any date, the ratio of (a) Net Debt on such date to (b) Capitalization on such date.

“New Capital” means the aggregate gross amount of proceeds from any capital (whether in the form of debt, equity or otherwise) raised by the Borrower or any of its Subsidiaries in one or a series of financings after January 1, 2021 (including (a) amounts borrowed (that were previously undrawn) under committed term loan facilities existing as of such date and (b) Indebtedness borrowed in lieu of the committed term loan facilities described in the foregoing clause (a) if the incurrence of such Indebtedness results in a reduction or termination of such commitments); provided that proceeds of any capital raise which are used substantially concurrently for (i) the purchase price of a new Vessel or (ii) repayment of existing Indebtedness (other than Indebtedness (A) maturing no later than the end of the first full calendar year following the date of such repayment or (B) under any revolving credit agreement the repayment of which is not accompanied by a corresponding permanent reduction in the related revolving credit commitments), in each case, shall not constitute New Capital.

“New Financings” means proceeds from:

a)    borrowed money (whether by loan or issuance and sale of debt securities), including drawings under this Agreement and any revolving credit facilities of the Borrower, and

b)    the issuance and sale of equity securities.

“New Guarantor” means, with respect to any Vessel delivered after the effectiveness of the Third Novation Agreement Supplement, the Subsidiary of the Borrower that (a) directly owns the Equity Interests of the Principal Subsidiary that acquired such Vessel and (b) delivers an Additional Guarantee.

“New Guarantor Subordination Agreement” means a subordination agreement pursuant to which the Lenders’ rights under the applicable Additional Guarantee will be fully subordinated in right of payment to the rights of the beneficiaries of the applicable Senior Guarantee, which subordination agreement shall be in a form and substance substantially the same as the other Subordination Agreements (reflecting any necessary logical and factual changes), with such changes, or otherwise in a form and substance, reasonably acceptable to the Facility Agent and the agent, trustee or other representative for such Senior Guarantee.

“Nominated Owner” means a Subsidiary of the Borrower to be nominated by the Borrower prior to the Actual Delivery Date to take delivery of the Vessel under the Construction Contract.

“Non-Financed Capex” means, with respect to any period, (a) the aggregate amount of purchases of property (including Vessels) and equipment by the Borrower and its Subsidiaries during such period as determined in good faith by the Borrower minus (b) the aggregate amount of committed financing available to be drawn during such period to fund any such purchases of property and equipment.

“Non-Yard Costs” has the meaning assigned to “NYC Allowance” in paragraph 1.5 of Article II of the Construction Contract and, when such expression is prefaced by the word “incurred”, shall mean such amount of the Non-Yard Costs not exceeding EUR 76,000,000 and, when aggregated with the Other Basic Contract Price Increases, in an amount not exceeding EUR 76,000,000, as shall at the relevant time have been paid, or become payable, to the Builder by the Borrower under the Construction Contract as part of the Contract Price.

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“Nordea Agreement” means the U.S. $1,150,000,000 amended and restated credit agreement dated as of October 12, 2017, among the Borrower, as the borrower, the various financial institutions as are or shall become parties thereto and Nordea Bank AB (publ), New York Branch as administrative agent, as amended, restated, supplemented or otherwise modified from time to time.

“Novated Loan Balance” is as defined in the Novation Agreement.

“Novation Agreement” means the novation agreement dated 24 July 2017 (as amended from time to time, including by the Third Novation Agreement Supplement) and made between the Original Borrower and the parties hereto pursuant to which (amongst other things) this Agreement was novated, amended and restated.

“Novation Effective Time” is as defined in the Novation Agreement.

“NYC Cut Off Date” means the date falling 60 days after the Actual Delivery Date or such later date as the Lenders (with the approval of BpiFAE) may agree.

“Obligations” means all obligations (payment or otherwise) of the Borrower arising under or in connection with this Agreement.

“Obligors” means the Borrower and the Guarantors.

“Option Period” is defined in Section 3.2(c).

“Organic Document” means, relative to the Borrower, its articles of incorporation (inclusive of any articles of amendment to its articles of incorporation) and its by-laws.

“Original Borrower” means Hoediscus Finance Limited of Cayman Corporate Centre, 27 Hospital Road, George Town, Grand Cayman KY1-9008, Cayman Islands.

“Other Basic Contract Price Increases” is defined in the Novation Agreement.

“Other ECA Parties” means the facility agents acting on behalf of the creditors under any ECA Financing, whether existing on or after the effectiveness of the Third Novation Agreement Supplement (excluding the Facility Agent acting in any representative capacity in connection with this Agreement).

“Other Guarantees” means the guarantees issued, or to be issued, by any of the First Priority Guarantor, the Second Priority Guarantors, the Third Priority Guarantor or any New Guarantor in favor of any Other ECA Party; provided that any Other Guarantee issued by (a) the First Priority Guarantor shall be pari passu in right of payment with the First Priority Guarantee, (b) any Second Priority Guarantor shall be pari passu (or junior) in right of payment with the Second Priority Guarantee, (c) the Third Priority Guarantor shall be pari passu (or junior) in right of payment with the Third Priority Guarantee and (d) any New Guarantor shall be pari passu in right of payment with each Additional Guarantee issued by such New Guarantor.

“Other Senior Parties” means each agent, trustee or other representative in respect of Bank Indebtedness or Credit Card Obligations.

“Paid Non-Yard Costs” means as at any relevant date, the amount in Euro of the Non- Yard Costs which have been paid for by the Borrower and, where applicable, supplied, installed and completed on the Purchased Vessel and as determined in accordance with the relevant amounts certified in the Delivery Non-Yard Costs Certificate or, as the case may be, the Final Non-Yard Costs Certificate as at such time.

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“Pari Passu Creditor” means with respect to any Group Member, any creditor under or in respect of any Indebtedness incurred by such Group Member (including in respect of any ECA Financing) which is not, as at December 31, 2020, secured by a Lien over a Vessel or which, at any time (whether pursuant to the operation of Section 7.1.9(d) or otherwise), shares in the same security and/or guarantee package as the Lenders.

“Participant” is defined in Section 11.11.2.

“Participant Register” is defined in Section 11.11.2.

“Participating Member State” means any member state of the European Union that has the Euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union.

“Percentage” means, relative to any Lender, the percentage set forth opposite its signature hereto or as set out in the applicable Lender Assignment Agreement, as such percentage may be adjusted from time to time pursuant to Section 4.9 or pursuant to Lender Assignment Agreement(s) executed by such Lender and its Assignee Lender(s) and delivered pursuant to Section 11.11.1.

“Permitted Refinancing” means, in respect of any Indebtedness or commitments, any amendment, restatement, extension, renewal, refinancing or replacement that does not increase the aggregate principal amount of such Indebtedness or commitments outstanding at the time of such Permitted Refinancing other than by the amount of unpaid accrued interest and premium thereon and underwriting discounts, fees, commissions and expenses associated with such amendment, restatement, supplement, refinancing or other modification.

“Person” means any natural person, corporation, limited liability company, partnership, firm, association, trust, government, governmental agency or any other entity, whether acting in an individual, fiduciary or other capacity.

“Poseidon Principles” means the financial industry framework for assessing and disclosing the climate alignment of ship finance portfolios published in June 2019 as the same may be amended or replaced to reflect changes in applicable law or regulation or the introduction of or changes to mandatory requirements of the International Maritime Organisation from time to time.

“Prepayment Event” is defined in Section 9.1.

“Principal Subsidiary” means any Subsidiary of the Borrower that owns a Vessel.

“Purchase Price” means, with respect to any Vessel, the book value of such Vessel at the time initially acquired by a Principal Subsidiary.

“Purchased Vessel” is defined in the preamble.

“Receivable Purchase Agreement” is as defined in the Novation Agreement.

“Reference Banks” means Société Générale and SMBC Bank International plc and such other Lender as shall be so named by the Borrower and agrees to serve in such role and each additional Reference Bank and/or each replacement Reference Bank appointed by the Facility Agent pursuant to Section 3.3.6.

“Register” is defined in Section 11.11.3.

“Repayment Date” means, subject to Section 4.8(c), each of the dates for payment of the repayment installments of the Loan pursuant to Section 3.1.

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“Required Lenders” means (a) at any time when SFIL is a Lender, SFIL and at least one other Lender that in the aggregate with SFIL hold more than 50% of the aggregate unpaid principal amount of the Loan or (b) or at any other time, Lenders that in the aggregate hold more than 50% of the aggregate unpaid principal amount of the Loan, and in each case, if no such principal amount is then outstanding, Lenders that in the aggregate have more than 50% of the Commitments.

“Resolution Authority” means any body which has authority to exercise any Write- down and Conversion Powers.

“Restatement Date” means March 12, 2020, being the date on which the form of this Agreement was amended and restated pursuant to the First Novation Agreement Supplement.

“Restricted Credit Enhancement” means any Group Member Guarantee, Lien or other security or other similar or analogous credit support arrangement granted by a Group Member in respect of any Indebtedness of a Group Member.

“Restricted Loan Arrangement” means any loan or credit (including any seller’s credit granted in connection with the sale of a Vessel or other assets (and provided that any such sale complies with the provisions of Section 9.1.11(c))) made available by a Group Member to any Person but excluding any such loan or credit that is provided:

(a)    to another Group Member:

(b)    to a Person in respect of which the Borrower or any Subsidiary holds Equity Interests;

(c)    in circumstances where the relevant credit is a seller’s credit granted by that Group Member in the ordinary course of industry business and consistent with past practice; or

(d)    in circumstances where the relevant credit is otherwise in the ordinary course of business and/or consistent with past practice (it being agreed that any loans provided by the Group to its travel agents, vendors or customers to assist the Group during the crisis and/or recovery will be considered in the ordinary course of business) and where the aggregate amount of such credit referred to in this paragraph (d) does not exceed $100,000,000 (or its equivalent in any other currency) at any relevant time,

provided that no Group Member shall be permitted to make or grant any new loan or other credit (or make any further advances in respect of any existing loan or other credit) of any kind to any Person at any time where an Event of Default or a Prepayment Event has occurred and is continuing. It is agreed that for the purpose of this definition “credit” shall not include any short term trade and/or operational receivables owing to a Group Member by a Person who is not a Group Member and which are created or arise in the ordinary course of business.

“Restricted Payments” means any dividend or other distribution (whether in cash, securities or other property (other than Equity Interests)), with respect to any Equity Interests in the Borrower, or any share buy-back program or other payment (whether in cash, securities or other property (other than Equity Interests)), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests in the Borrower.

“Restricted Voluntary Prepayment” means, in respect of any Indebtedness for borrowed money of any Group Member (other than any such Indebtedness incurred pursuant

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to an ECA Financing), the relevant Group Member elects to prepay, repay or redeem that Indebtedness prior to its scheduled maturity date other than:

(a)    any Indebtedness which is scheduled to mature on or prior to the end of the following calendar year (and whether pursuant to an amendment and extension of the agreements evidencing such Indebtedness and/or using proceeds raised by any Group Member in connection with any issuance of capital (whether in the form of Indebtedness for borrowed money, equity or otherwise but, in the case of any Indebtedness, subject to that Indebtedness being incurred in compliance with the carve-out provision set out in paragraph (c) of the definition of Debt Incurrence) or pursuant to the exercise of the equity claw feature in the Secured Note Indenture), provided, however, that the Borrower may, with the prior written consent of BpiFAE, prepay, repay or redeem any notes issued under indentures which are callable in accordance with their terms, including any call date through the use of the equity claw feature;

(b)    pursuant to a voluntary repayment under a revolving credit facility that does not result in the permanent reduction of the relevant revolving credit commitments under that revolving credit facility; and/or

(c)    where such prepayment, repayment or redemption is made solely for the purpose of avoiding an event of default or acceleration under the terms of the facility agreement in respect of the relevant Indebtedness.

“S&P” means Standard & Poor’s Financial Services LLC, a wholly-owned subsidiary of The McGraw-Hill Financial Inc.

“Sanctioned Country” means, at any time, a country, region or territory which is itself the subject or target of any Sanctions.

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions- related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, or by the United Nations Security Council, the European Union or any European Union member state, or any person owned or controlled by any such Person or Persons, or (b) any Person operating, organized or resident in a Sanctioned Country.

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom.

“SEC” means the United States Securities and Exchange Commission and any successor thereto.

“Second Novation Agreement Supplement” means the supplemental agreement dated 29 August 2020 and made between, amongst others, the Original Borrower and the parties hereto, pursuant to which the Novation Agreement was supplemented.

“Second Priority Assets” means the Vessels known on the date the Third Novation Agreement Supplement becomes effective as or that sailed under the name (i) Azamara Quest, (ii) Azamara Pursuit, (iii) Azamara Journey, (iv) Celebrity Edge, (v) Celebrity Apex, (vi) Celebrity Flora, (vii) Celebrity Xpedition, (viii) Celebrity Xperience, (ix) Celebrity Xploration, (x) Monarch, (xi) Horizon and (xii) Sovereign (it being understood that such Vessels shall remain “Second Priority Assets” regardless of any change in name or ownership after such date).

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“Second Priority Guarantee” means the second priority guarantee granted by the Second Priority Guarantors prior to the Effective Time (and any other second priority guarantee granted by a Second Priority Holdco Subsidiary in connection with becoming a Second Priority Guarantor) in favor of the Facility Agent for the benefit of the Agents and the Lenders, in each case substantially in the form attached hereto as Exhibit H.

“Second Priority Guarantors” means RCL Cruise Holdings LLC, Torcatt Enterprises S.A., RCL Holdings Cooperatief UA, RCL Cruises Ltd and RCL Investments Ltd (and any of their respective successors) and any other Second Priority Holdco Subsidiary that has granted or, prior to that entity becoming a Second Priority Holdco Subsidiary pursuant to a Disposal of a Second Priority Asset in accordance with Section 7.2.5(b)(iii)(A), will grant a Second Priority Guarantee.

“Second Priority Holdco Subsidiaries” means (a) RCL Cruises Ltd. or any other Subsidiaries of the Borrower that directly own all of the equity interests in (i) RCL TUI Cruises German Verwaltungs GmbH and (ii) RCL TUI Cruises German Holding GmbH & Co. KG and (b) one or more Subsidiaries of the Borrower that directly own any of the Equity Interests issued by any other Subsidiary of the Borrower that owns any Second Priority Asset. For the avoidance of doubt, Second Priority Holdco Subsidiaries shall not include any Principal Subsidiary.

“Second Priority Release Event” means the occurrence of any event or other circumstance that results in either (x) 80% of the aggregate principal amount of Bank Indebtedness outstanding as of the effectiveness of the Third Novation Agreement Supplement (being $5,300,000,000 (and 80% of which is $4,240,000,000)) or (y) 100% of the aggregate principal amount of Secured Note Indebtedness outstanding as of the effectiveness of the Third Novation Agreement Supplement (being $3,320,000,000):

a)    no longer remaining outstanding (whether as a result of repayment, redemption or otherwise (but excluding in connection with any enforcement action taken by the relevant creditors in respect of that Indebtedness)); and

b)    not having been refinanced (whether initially or through subsequent refinancings) with Indebtedness that is (i) secured by a Lien or (ii) incurred or guaranteed by any one or more Subsidiaries of the Borrower,

and which, in the case of (y) above, has resulted in the release of (or will result in the substantially simultaneous release of) each guarantee granted by the Second Priority Guarantors in respect of the Bank Indebtedness.

Notwithstanding the foregoing, a Second Priority Release Event shall in no case occur if the Borrower has failed to pay any Indebtedness that is outstanding under any ECA Financing (including this Agreement) when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise). For the avoidance of doubt, if a Second Priority Release Event would have occurred but for the continuance of the payment default described above, then a Second Priority Release Event will occur immediately upon that payment default being remedied.

“Secured Note Indebtedness” means the Borrower’s Indebtedness under the Secured Note Indenture.

“Secured Note Indenture” means that certain Indenture, dated as of May 19, 2020 (as amended, supplemented, extended, refinanced, replaced and/or otherwise modified from time to time) in respect of the $1,000,000,000 10.875% senior secured notes due 2023 and $2,320,000,000 11.50% senior secured notes due 2025, by and among the Borrower, as issuer, the guarantors party thereto from time to time, and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as trustee and as security agent.

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“Security Trustee” means Citicorp Trustee Company Limited of Citigroup Centre, Canada Square, London E14 5LB in its capacity as security trustee for the purpose of the Escrow Account Security.

“Senior Debt Rating” means, as of any date, (a) the implied senior debt rating of the Borrower for debt pari passu in right of payment and in right of collateral security with the Obligations as given by Moody’s and S&P or (b) in the event the Borrower receives an actual unsecured senior debt rating (apart from an implied rating) from Moody’s and/or S&P, such actual rating or ratings, as the case may be (and in such case the Senior Debt Rating shall not be determined by reference to any implied senior debt rating from either agency).

“Senior Guarantee” means any guarantee by a New Guarantor of Indebtedness incurred by the Borrower or any of its Subsidiaries after the effectiveness of the Third Novation Agreement Supplement; provided that the aggregate principal amount of Indebtedness guaranteed under any Senior Guarantee shall in no case exceed 10.0% of the Purchase Price of the relevant Vessel owned by the Principal Subsidiary of such New Guarantor that acquired such Vessel.

“Senior Parties” means each agent, trustee or other representative in respect of Unsecured Note Indebtedness or DDTL Indebtedness.

“SFIL” means SFIL, a French société anonyme with is registered office at 1-3 rue du Passeur de Boulogne, 92130 Issy-les-Moulineaux, France, registered at the trade and companies registry of Nanterre under number 428 782 585.

“Signing Date” means the date of the Novation Agreement.

“Statement of Compliance” means a Statement of Compliance related to fuel oil consumption pursuant to regulations 6.6 and 6.7 of Annex VI.

“Stockholders’ Equity” means, as at any date, the Borrower’s stockholders’ equity on such date, excluding Accumulated Other Comprehensive Income (Loss), determined in accordance with GAAP, provided that any non-cash charge to Stockholders’ Equity resulting (directly or indirectly) from a change after the Signing Date in GAAP or in the interpretation thereof shall be disregarded in the computation of Stockholders’ Equity such that the amount of any reduction thereof resulting from such change shall be added back to Stockholders’ Equity.

“Subordination Agreement” means any subordination agreement with respect to the Second Priority Guarantee or the Third Priority Guarantee executed by the Facility Agent and any of the Senior Parties or Other Senior Parties.

“Subsidiary” means, with respect to any Person, any corporation of which more than 50% of the outstanding capital stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether at the time capital stock of any other class or classes of such corporation shall or might have voting power upon the occurrence of any contingency) is at the time directly or indirectly owned by such Person, by such Person and one or more other Subsidiaries of such Person, or by one or more other Subsidiaries of such Person.

“TARGET2” means the Trans-European Automated Real-time Gross Settlement Express Transfer payment system which utilises a single shared platform and which was launched on 19 November 2007.

“TARGET Day” means any day on which TARGET2 is open for the settlement of payments in euro.

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“Third Novation Agreement Supplement” means the supplemental agreement dated 13 November 2020 and made between, amongst others, the Original Borrower and the parties hereto, pursuant to which the Novation Agreement was supplemented.

“Third Priority Assets” means the Vessels known on the date the Third Novation Agreement Supplement becomes effective as (i) Symphony of the Seas, (ii) Oasis of the Seas, (iii) Harmony of the Seas, (iv) Spectrum of the Seas, (v) Quantum of the Seas, (vi) Ovation of the Seas and (vii) Anthem of the Seas (it being understood that such Vessels shall remain “Third Priority Assets” regardless of any change in name or ownership after the such date).

“Third Priority Guarantee” means the third priority guarantee granted by RCI Holdings LLC prior to the Effective Time (and any other third priority guarantee granted by a Third Priority Holdco Subsidiary in connection with becoming a Third Priority Guarantor) in favor of the Facility Agent for the benefit of the Agents and the Lenders, in each case substantially in the form attached hereto as Exhibit I.

“Third Priority Guarantor” means RCI Holdings LLC (and any of its successors) and any other Third Priority Holdco Subsidiary that has granted or, prior to that entity becoming a Third Priority Holdco Subsidiary pursuant to a Disposal of a Third Priority Asset in accordance with Section 7.2.5(c)(iii)(A), will grant a Third Priority Guarantee.

“Third Priority Holdco Subsidiaries” means one or more Subsidiaries of the Borrower that directly own any of the Equity Interests issued by any other Subsidiary of the Borrower that owns any Third Priority Asset.

“Third Priority Release Event” means the occurrence of any event or other circumstance that results in either (x) 80% of the aggregate principal amount of Bank Indebtedness outstanding as of the effectiveness of the Third Novation Agreement Supplement (being $5,300,000,000 (and 80% of which is $4,240,000,000)) or (y) 100% of the aggregate principal amount of Unsecured Note Indebtedness and the DDTL Indebtedness outstanding as of the effectiveness of the Third Novation Agreement Supplement (being, in aggregate, $1,700,000,000):

a)    no longer remaining outstanding (whether as a result of repayment, redemption or otherwise (but excluding in connection with any enforcement action taken by the relevant creditors in respect of that Indebtedness)); and

b)    not having been refinanced (whether initially or through subsequent refinancings) with Indebtedness that is (i) secured by a Lien or (ii) incurred or guaranteed by any one or more Subsidiaries of the Borrower,

and which, in the case of (y) above, has resulted in the release of (or will result in the substantially simultaneous release of) each guarantee granted by the Third Priority Guarantor in respect of the Unsecured Note Indebtedness, the DDTL Indebtedness and the Bank Indebtedness.

Notwithstanding the foregoing, a Third Priority Release Event shall in no case occur if the Borrower has failed to pay any Indebtedness that is outstanding under any ECA Financing (including this Agreement) when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise). For the avoidance of doubt, if a Third Priority Release Event would have occurred but for the continuance of the payment default described above, then a Third Priority Release Event will occur immediately upon that payment default being remedied.

“UK Bail-In Legislation” means (to the extent that the United Kingdom is not an EEA Member Country which has implemented, or implements, Article 55 of Directive 2014/59/EU) Part I of the United Kingdom Banking Act 2009 and any other law or regulation applicable in the United Kingdom relating to the resolution of unsound or failing banks,

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investment firms or other financial institutions or their affiliates (otherwise than through liquidation, administration or other insolvency proceedings).

“United States” or “U.S.” means the United States of America, its fifty States and the District of Columbia.

“Unpaid Non-Yard Costs” means, as at the Actual Delivery Date, the amount in Euro of the Non-Yard Costs which have not been paid for by the Borrower and/or where applicable, supplied, installed and completed on the Purchased Vessel as at the Actual Delivery Date and as determined in accordance with the relevant amounts certified in the Delivery Non-Yard Costs Certificate.

“Unsecured Note Indebtedness” means the Borrower’s Indebtedness under the Unsecured Note Indenture.

“Unsecured Note Indenture” means that certain Indenture, dated as of June 9, 2020 (as amended, supplemented, extended, refinanced, replaced and/or otherwise modified from time to time) in respect of the $1,000,000,000 9.125% senior notes due 2023, by and among the Borrower, as issuer, the guarantor party thereto, and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as trustee.

“Vessel” means a passenger cruise vessel owned by a Group Member.

“Write-Down and Conversion Powers” means: (a) with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule; and (b) in relation to any UK Bail-In Legislation: (i) any powers under that UK Bail-In Legislation to cancel, transfer or dilute shares issued by a person that is a bank or investment firm or other financial institution or affiliate of a bank, investment firm or other financial institution, to cancel, reduce, modify or change the form of a liability of such a person or any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that UK Bail-In Legislation that are related to or ancillary to any of those powers; and (ii) any similar or analogous powers under that UK Bail-In Legislation.

SECTION 1.2.    USE OF DEFINED TERMS. Unless otherwise defined or the context otherwise requires, terms for which meanings are provided in this Agreement shall, when capitalized, have such meanings when used in the Loan Request and each notice and other communication delivered from time to time in connection with this Agreement or any other Loan Document.

SECTION 1.3.    CROSS-REFERENCES. Unless otherwise specified, references in this Agreement and in each other Loan Document to any Article or Section are references to such Article or Section of this Agreement or such other Loan Document, as the case may be, and, unless otherwise specified, references in any Article, Section or definition to any clause are references to such clause of such Article, Section or definition.

SECTION 1.4.    ACCOUNTING AND FINANCIAL DETERMINATIONS. Unless otherwise specified, all accounting terms used herein or in any other Loan Document shall be interpreted, all accounting determinations and computations hereunder or thereunder (including under Section 7.2.4) shall be made, and all financial statements required to be delivered hereunder or thereunder shall be prepared, in accordance with United States generally accepted accounting principles (“GAAP”) consistently applied (or, if not consistently applied, accompanied by details of the inconsistencies); provided that if the Borrower elects to apply or is required to apply International Financial Reporting Standards

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(“IFRS”) accounting principles in lieu of GAAP, upon any such election and notice to the Facility Agent, references herein to GAAP shall thereafter be construed to mean IFRS (except as otherwise provided in this Agreement); provided further that if, as a result of (i) any change in GAAP or IFRS or in the interpretation thereof or (ii) the application by the Borrower of IFRS in lieu of GAAP, in each case, after the date of the financial statements referred to in Section 6.15, there is a change in the manner of determining any of the items referred to herein or thereunder that are to be determined by reference to GAAP, and the effect of such change would (in the reasonable opinion of the Borrower or the Facility Agent) be such as to affect the basis or efficacy of the financial covenants contained in Section 7.2.4 in ascertaining the consolidated financial condition of the Borrower and its Subsidiaries and the Borrower notifies the Facility Agent that the Borrower requests an amendment to any provision hereof to eliminate such change occurring after the date hereof in GAAP or the application thereof on the operation of such provision (or if the Facility Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), then such item shall for the purposes of Section 7.2.4 continue to be determined in accordance with GAAP relating thereto as if GAAP were applied immediately prior to such change in GAAP or in the interpretation thereof until such notice shall have been withdrawn or such provision amended in accordance herewith. Notwithstanding the foregoing, all obligations of any person that are or would be characterized as operating lease obligations in accordance with GAAP on the B34 Facility Amendment Date (whether or not such operating lease obligations were in effect on such date) shall continue to be accounted for as operating lease obligations for the purposes of this Agreement regardless of any change in GAAP following the B34 Facility Amendment Date that would otherwise require such obligations to be recharacterized (on a prospective or retroactive basis or otherwise) as capital leases, provided that, for clarification purposes, operating leases recorded as liabilities on the balance sheet due to a change in accounting treatment, or otherwise, shall for all purposes not be treated as Indebtedness, Capital Lease Obligations or Capitalized Lease Liabilities.

ARTICLE II

COMMITMENTS AND BORROWING PROCEDURES

SECTION 2.1.    COMMITMENT. On the terms and subject to the conditions of this Agreement (including Article V), each Lender severally agrees to make its portion of the Loan pursuant to its Commitment described in Section 2.2. No Lender’s obligation to make its portion of the Loan shall be affected by any other Lender’s failure to make its portion of the Loan.

SECTION 2.2.    COMMITMENT OF THE LENDERS; TERMINATION AND REDUCTION OF COMMITMENTS.

i.    Each Lender will make its portion of the Loan available to the Borrower in accordance with Section 2.3 on the Actual Delivery Date. The commitment of each Lender described in this Section 2.2 (herein referred to as its “Commitment”) shall be the commitment of such Lender to make available to the Borrower its portion of the Loan hereunder expressed as the initial amount set forth opposite such Lender’s name on its signature page attached hereto or, in the case of any Lender that becomes a Lender pursuant to an assignment pursuant to Section 11.11.1, the amount set forth as such Lender’s Commitment in the related Lender Assignment Agreement, in each case as such amount may be reduced from time to time pursuant clause 10.2 of the Novation Agreement or reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 11.11.1. Notwithstanding the foregoing, each Lender’s Commitment shall terminate on the earlier of (i) the Commitment Termination Date if the Purchased Vessel is not delivered prior to such date and (ii) the Actual Delivery Date.

ii.    If any Lender shall default in its obligations under Section 2.1, the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist

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the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Lender.

SECTION 2.3.    BORROWING PROCEDURE.

a)    Part of the Loan in an amount equal to the Novated Loan Balance shall be assumed by the Borrower and be deemed to be advanced to, and borrowed by the Borrower, pursuant to the provisions of clause 3 of the Novation Agreement.

b)    In relation to the amount of the Loan comprised by the Additional Advances, the Borrower shall deliver a Loan Request and the documents required to be delivered pursuant to Section 5.1.1(a) to the Facility Agent on or before 3:00 p.m., London time, not less than two (2) Business Days prior to the anticipated Actual Delivery Date. The Additional Advances shall be drawn in Euros.

c)    The Facility Agent shall promptly notify each Lender of the Loan Request in respect of the Additional Advances by forwarding a copy thereof to each Lender, together with its attachments. On the terms and subject to the conditions of this Agreement, the portion of the Loan in respect of the Additional Advances shall be made on the Actual Delivery Date. On or before 11:00 a.m., London time, on the Actual Delivery Date, the Lenders shall, without any set-off or counterclaim, deposit with the Facility Agent same day funds in an amount equal to such Lender’s Percentage of the requested portion of the Additional Advances in Euros. Such deposits will be made to such account which the Facility Agent shall specify from time to time by notice to the Lenders. To the extent funds are so received from the Lenders (and having regard, where applicable, to Sections 2.3d), e) and f) below), the Facility Agent shall, without any set-off or counterclaim, make such funds available to the Borrower on the Actual Delivery Date by wire transfer of same day funds to the accounts the Borrower shall have specified in its Loan Request.

d)    If the Borrower elects to finance that part of the BpiFAE Premium payable by the Borrower with an Additional Advance under clause 5.2(b)(i) of the Novation Agreement, the Borrower shall indicate such election in the Loan Request.

e)    If the Borrower elects to finance that part of the BpiFAE Premium payable by the Borrower with an Additional Advance under clause 5.2(b)(ii) of the Novation Agreement, the Borrower shall indicate such election in the Loan Request.

f)    In relation to any Additional Advance that is to be advanced to the Borrower in respect of the Non-Yard Costs it is agreed that:

i.    an amount equal to eighty per cent (80%) of the Paid Non-Yard Costs shall be advanced to the Borrower on the Actual Delivery Date in accordance with the provisions of Section 2.3 c), which amount shall be determined by the Facility Agent based on the amounts contained in the Delivery Non-Yard Costs Certificate; and

ii.    an amount equal to eighty per cent (80%) of the Unpaid Non-Yard Costs, which amount shall be determined by the Facility Agent based on the amounts contained in the Delivery Non-Yard Costs Certificate (the “Escrow Amount”), shall be remitted by the Facility Agent (and the Borrower hereby instructs the Facility Agent to make such remittance) to the Escrow Account and such amount shall be regulated in accordance with the following provisions of this Section 2.3 f) and the Escrow Account Security, subject to the aggregate of the amounts referred to in i) and ii) above not exceeding the Maximum Non-Yard Costs Amount.

Where an Escrow Amount payment is made to the Escrow Account pursuant to ii) above, the Borrower shall be entitled at any time prior to the NYC Cut Off Date to provide the Facility Agent with the Final Non-Yard Cost Certificate setting out the final amount of

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the Paid Non-Yard Costs. Where the Final Non-Yard Costs Certificate is so received by the Facility Agent, the Facility Agent shall promptly authorize the release of the Escrow Amount (or, if less, an amount equal to eighty per cent of the final amount of the Paid Non-Yard Costs less the amount previously advanced to the Borrower under i) above) to the Borrower. Any interest accruing on the Escrow Account shall be released to the Borrower at the same time as the release of the Escrow Amount (or, if applicable, part thereof) to the Borrower pursuant to this provision.

If any amount of the Escrow Amount remains on the Escrow Account on the day falling immediately after the NYC Cut Off Date (having regard to any applicable permitted release of moneys from the Escrow Account to the Borrower referred to above) then on the Business Day thereafter the Facility Agent shall be entitled to request the withdrawal of that amount from the Escrow Account and shall apply the amount so received, on behalf of the Borrower, in or towards prepayment of the Loan.

The basis on which the Escrow Account Security is held by the Security Trustee for the benefit of the Lenders is regulated under the Escrow Agency and Trust Deed.

SECTION 2.4.    FUNDING. Each Lender may, if it so elects, fulfill its obligation to make or continue its portion of the Loan hereunder by causing a branch or Affiliate (or an international banking facility created by such Lender) other than that indicated next to its signature to this Agreement or, as the case may be, in the relevant Lender Assignment Agreement, to make or maintain such portion of the Loan; provided that such portion of the Loan shall nonetheless be deemed to have been made and to be held by such Lender, and the obligation of the Borrower to repay such portion of the Loan shall nevertheless be to such Lender for the account of such foreign branch, Affiliate or international banking facility; provided, further, that the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had the Lender not caused such branch or Affiliate (or international banking facility) to make or maintain such portion of the Loan.

ARTICLE III

REPAYMENTS, PREPAYMENTS, INTEREST AND FEES

SECTION 3.1.    REPAYMENTS.

a)    The Borrower shall repay the Loan in 24 equal semi-annual installments, with the first installment to fall due on the date falling six (6) months after the Actual Delivery Date and the final installment to fall due on the date of Final Maturity.

b)    No such amounts repaid by the Borrower pursuant to this Section 3.1 may be re- borrowed under the terms of this Agreement.

SECTION 3.2.    PREPAYMENT.

a)    The Borrower

i.    may, from time to time on any Business Day, make a voluntary prepayment, in whole or in part, of the outstanding principal amount of the Loan; provided that:

1.    all such voluntary prepayments shall require at least five (5) Business Days’ prior written notice to the Facility Agent; and

2.    all such voluntary partial prepayments shall be in an aggregate minimum amount of €10,000,000 and a multiple of €1,000,000 (or in the remaining amount of the Loan) and shall be applied in inverse order of maturity or

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ratably among all remaining installments, as the Borrower shall designate to the Facility Agent, in satisfaction of the remaining repayment installments of the Loan; and

ii.    shall, immediately upon any acceleration of the repayment of the installments of the Loan pursuant to Section 8.2 or 8.3 or the mandatory prepayment of the Loan pursuant to Section 9.2, repay the Loan.

b)    If it becomes unlawful in any jurisdiction for any Lender to perform any of its obligations under the Loan Documents or to maintain or fund its portion of the Loan, the affected Lender may give written notice (the “Illegality Notice”) to the Borrower and the Facility Agent of such event, including reasonable details of the relevant circumstances.

c)    If an affected Lender delivers an Illegality Notice, the Borrower, the Facility Agent and the affected Lender shall discuss in good faith (but without obligation) what steps may be open to the relevant Lender to mitigate or remove such circumstances but, if they are unable to agree such steps within 20 Business Days or if the Borrower so elects, the Borrower shall have the right, but not the obligation, exercisable at any time within 50 days after receipt of such Illegality Notice or, if earlier, the date upon which the unlawful event referred to in (b) above will apply (but not being a date falling earlier than the end of the 20 Business Day period referred to above) (the “Option Period”), either (1) to prepay the portion of the Loan held by such Lender in full on or before the expiry of the Option Period, together with all unpaid interest and fees thereon accrued to but excluding the date of such prepayment, or (2) to replace such Lender on or before the expiry of the Option Period with one or more financial institutions (I) acceptable to the Facility Agent (such consent not to be unreasonably withheld or delayed) and (II) where relevant, eligible to benefit from an Interest Stabilisation Agreement, pursuant to assignment(s) notified to and consented in writing by BpiFAE and, where relevant Natixis DAI, provided that (x) in the case of a single assignment, any such assignment shall be either an assignment of all of the rights and obligations of the assigning Lender under this Agreement or, in the case of more than one assignment, an assignment of a portion of such rights and obligations made concurrently with another such assignment or other such assignments that collectively cover all of the rights and obligations of the assigning Lender under this Agreement and (y) no Lender shall be obliged to make any such assignment as a result of an election by the Borrower pursuant to this Section 3.2(c) unless and until such Lender shall have received one or more payments from one or more Assignee Lenders and/or the Borrower in an aggregate amount at least equal to the portion of the Loan held by such Lender, together with all unpaid interest and fees thereon accrued to but excluding the date of such assignment (and all other amounts then owing to such Lender under this Agreement).

Each prepayment of the Loan made pursuant to this Section shall be without premium or penalty, except as may be required by Section 4.4. No amounts prepaid by the Borrower may be re-borrowed under the terms of this Agreement.

SECTION 3.3.    INTEREST PROVISIONS. Interest on the outstanding principal amount of the Loan shall accrue and be payable in accordance with this Section 3.3.

SECTION 3.3.1    Rates. The Loan shall accrue interest from the Actual Delivery Date to the date of repayment or prepayment of the Loan in full to the Lenders at either the Fixed Rate or, where the proviso to Section 5.1.10 applies, the Floating Rate. Interest calculated at the Fixed Rate or the Floating Rate shall (having regard in the case of a Defaulting Lender to Section 10.3(b)) be payable in arrears on each Repayment Date. The Loan shall bear interest from and including the first day of the applicable Interest Period to (but not including) the last day of such Interest Period at the interest rate determined as applicable to the Loan. All interest shall be calculated on the basis of the actual number of days elapsed over a year comprised of 360 days.

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SECTION 3.3.2    [Intentionally omitted]

SECTION 3.3.3    Interest stabilisation. Each Lender who is a party hereto on the Restatement Date represents and warrants to the Borrower that it has entered into an Interest Stabilisation Agreement and any Lender not a party hereto on the Restatement Date (other than BpiFAE or CAFFIL as assignee of all or any of SFIL’s rights as Lender following the enforcement of the security granted pursuant to paragraph (iv) of Section 11.11.1 in connection with the BpiFAE Enhanced Guarantee, subject as provided in Section 11.11.1(iv)) represents and warrants to the Borrower on the date that such Lender becomes a party hereto that it has entered into an Interest Stabilisation Agreement on or prior to becoming a party hereto.

SECTION 3.3.4    Post-Maturity Rates. After the date any principal amount of the Loan is due and payable (whether on any Repayment Date, upon acceleration or otherwise), or after any other monetary Obligation of the Borrower shall have become due and payable, the Borrower shall pay, but only to the extent permitted by law, interest (after as well as before judgment) on such amounts for each day during the period of such default at a rate per annum certified by the Facility Agent to the Borrower (which certification shall be conclusive in the absence of manifest error) to be equal to the sum of the Floating Rate plus 1.5% per annum.

SECTION 3.3.5    Payment Dates. Interest accrued on the Loan shall be payable, without duplication, on the earliest of:

1.    each Interest Payment Date;

2.    each Repayment Date;

3.    the date of any prepayment, in whole or in part, of principal outstanding on the Loan (but only on the principal so prepaid); and

4.    on that portion of the Loan the repayment of which is accelerated pursuant to Section 8.2 or Section 8.3, immediately upon such acceleration.

SECTION 3.3.6    Interest Rate Determination; Replacement Reference Banks. Where Section 3.3.4 or the Floating Rate applies, the Facility Agent shall obtain from each Reference Bank timely information for the purpose of determining the EURO Rate in the event that no offered quotation appears on Thomson Reuters EURIBOR 01 Page (or any successor page) and the EURO Rate is to be determined by reference to quotations supplied by the Reference Banks and not by reference to the Historic Screen Rate. If any one or more of the Reference Banks shall fail to furnish in a timely manner such information to the Facility Agent for any such interest rate, the Facility Agent shall determine such interest rate on the basis of the information furnished by the remaining Reference Banks. If the Borrower elects to add an additional Reference Bank hereunder or a Reference Bank ceases for any reason to be able and willing to act as such, the Facility Agent shall, at the direction of the Required Lenders and after consultation with the Borrower and the Lenders, appoint a replacement for such Reference Bank reasonably acceptable to the Borrower, and such replaced Reference Bank shall cease to be a Reference Bank hereunder. The Facility Agent shall furnish to the Borrower and to the Lenders each determination of the EURO Rate made by reference to quotations of interest rates furnished by Reference Banks (it being understood that the Facility Agent shall not be required to disclose to any party hereto (other than the Borrower) any information regarding any Reference Bank or any rate quoted by a Reference Bank, including, without limitation, whether a Reference Bank has provided a rate or the rate provided by any individual Reference Bank).

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Interest accrued on the Loan or other monetary Obligations arising under this Agreement or any other Loan Document after the date such amount is due and payable (whether upon acceleration or otherwise) shall be payable upon demand.

SECTION 3.3.7    Unavailability of the EURO Rate.

Notwithstanding anything to the contrary in this Agreement or any other Loan Documents, if the Facility Agent determines (which determination shall, in the absence of manifest error, be conclusive) or the Borrower or the Required Lenders notify the Facility Agent (with, in the case of the Required Lenders, a copy to Borrower) that the Borrower or the Required Lenders (as applicable) have determined that:

a)    adequate and reasonable means would not exist for ascertaining (should the Floating Rate apply) the EURO Rate for the relevant Interest Period including, without limitation, because the EURO Rate is not available or published on a current basis and such circumstances are unlikely to be temporary; or

b)    the administrator of the EURO Rate or a governmental authority having jurisdiction over the Facility Agent has made a public statement identifying a specific date after which the EURO Rate shall no longer be made available or used for determining the interest rate of loans (such specific date, the “Scheduled Unavailability Date”); or

c)    syndicated loans currently being executed, or existing syndicated loans that include language similar to that contained in this section 3.3.7, are being executed and/or amended (as applicable) to incorporate or adopt a new benchmark interest rate to replace the EURO Rate,

then, reasonably promptly after such determination by the Facility Agent or receipt by the Facility Agent of such notice, as applicable, or if the Borrower otherwise requests, the Facility Agent and the Borrower may amend this Agreement to replace the EURO Rate with an alternate benchmark rate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to any evolving or then existing convention for similar EURO denominated syndicated credit facilities for such alternative benchmarks (any such proposed rate, a “EURO Successor Rate”), and also together with any proposed EURO Successor Rate Conforming Changes (as defined below) and any such amendment shall become effective at 5:00 P.M. (London time) on the fifth (5) Business Day after the Facility Agent shall have posted such proposed amendment to all Lenders and the Borrower unless, prior to such time, Lenders comprising the Required Lenders have delivered to the Facility Agent written notice that such Required Lenders do not accept such amendment. Such EURO Successor Rate shall be applied in a manner consistent with market practice; provided that to the extent such market practice is not administratively feasible for the Facility Agent, such EURO Successor Rate shall be applied in a manner as otherwise reasonably determined by the Facility Agent.

If no EURO Successor Rate has been determined and the circumstances under paragraph a) above exist or the Scheduled Unavailability Date has occurred (as applicable), the Facility Agent will promptly notify the Borrower and each Lender.

Thereafter, the obligation of the Lenders to fund or maintain the relevant portion of the Loan at the EURO Rate (to the extent of the affected part of the Loan or Interest Periods) shall be suspended. Upon receipt of such notice, the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of any part of the Loan (to the extent of the affected part of the Loan or Interest Periods).

Notwithstanding anything else herein, any definition of EURO Successor Rate shall provide that in no event shall such EURO Successor Rate be less than zero for purposes of this Agreement.

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The Facility Agent (acting on the instructions of the Required Lenders) and the Borrower shall, during the period between 1 April 2021 and 30 June 2022 (or such later date as may be agreed between the Required Lenders and the Borrower), enter into negotiations in good faith with a view to agreeing a basis upon which a EURO Successor Rate can be used in replacement of the EURO Rate, together with any associated EURO Successor Rate Conforming Changes, and a timetable for the implementation of these changes so that the appropriate changes can be made prior to the Scheduled Unavailability Date.

For the purposes of this Agreement, “EURO Successor Rate Conforming Changes” means, with respect to any proposed EURO Successor Rate, any conforming changes to the definition of Floating Rate, Interest Period, timing and frequency of determining rates and making payments of interest and other administrative matters as may be appropriate, in the discretion of the Facility Agent in consultation with the Borrower, to reflect the adoption of such EURO Successor Rate and to permit the administration thereof by the Facility Agent in a manner substantially consistent with market practice (or, if the Facility Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market practice for the administration of such EURO Successor Rate exists, in such other manner of administration as the Facility Agent determines is reasonably necessary in connection with the administration of this Agreement).

SECTION 3.4.    COMMITMENT FEES. Subject to clause 10.1 of the Novation Agreement, the Borrower agrees to pay to the Facility Agent for the account of each Lender a commitment fee (the “Commitment Fee”) on its daily unused portion of Maximum Loan Amount (as such amount may be adjusted from time to time), for the period commencing on the Signing Date and continuing through the earliest to occur (the “Commitment Fee Termination Date”) of (i) the Actual Delivery Date, (ii) the date upon which the Facility Agent has provided the Borrower with written notice that the Lenders will not advance the Loan because the Commitments have been terminated pursuant to Section 8.2 or 8.3, (iii) the Commitment Termination Date and (iv) the date the Commitments shall have been terminated in full pursuant to clause 10.2 of the Novation Agreement.

SECTION 3.4.1    Payment. The Commitment Fee shall be payable by the Borrower to the Facility Agent for the account of each Lender six-monthly in arrears, with the first such payment (the “First Commitment Fee Payment”) to be made on the day falling six months following the Signing Date and the final such payment to be made on the Commitment Fee Termination Date (each date on which a Commitment Fee payment is required to be made in accordance with this Section 3.4.1 referred to herein as a “Commitment Fee Payment Date”). The Commitment Fee shall be in the amount in EUR equal to the product of the Applicable Commitment Rate, multiplied by, for each day elapsed since the preceding Commitment Fee Payment Date (or, in the case of the First Commitment Fee Payment, the Signing Date), 75% of the daily unused portion of Maximum Loan Amount (as such amount may be adjusted from time to time), divided by 360 days.

SECTION 3.4.2    Other Fees. The Borrower agrees to pay to the Facility Agent the agreed-upon fees set forth in the Fee Letters on the dates and in the amounts set forth therein.

ARTICLE IV

CERTAIN EURO RATE AND OTHER PROVISIONS

SECTION 4.1.    EURO RATE LENDING UNLAWFUL. If after the Signing Date the introduction of or any change in or in the interpretation of any law makes it unlawful, or any central bank or other governmental authority having jurisdiction over such Lender asserts that it is unlawful for such Lender to make, continue or maintain its portion of the Loan where the relevant Lender has funded itself in the interbank market at a rate based on the EURO Rate, the obligation of such Lender to make, continue or maintain its portion of the

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Loan shall, upon notice thereof to the Borrower, the Facility Agent and each other Lender, forthwith be suspended until the circumstances causing such suspension no longer exist, provided that such Lender’s obligation to make, continue and maintain its portion of the Loan hereunder shall be automatically converted into an obligation to make, continue and maintain its portion of the Loan bearing interest at a rate to be negotiated between such Lender and the Borrower that is the equivalent of the sum of the EURO Rate for the relevant Interest Period plus the Floating Rate Margin.

SECTION 4.2.    DEPOSITS UNAVAILABLE. If any Lender has funded itself in the interbank market and the Facility Agent shall have determined that:

a)    Euro deposits in the relevant amount and for the relevant Interest Period are not available to each Reference Bank in its relevant market, or

b)    by reason of circumstances affecting the Reference Banks’ relevant markets, adequate means do not exist for ascertaining the interest rate applicable hereunder to EURO Rate loans for the relevant Interest Period, or

c)    the cost to Lenders that in the aggregate hold more than 50% of the aggregate outstanding principal amount of the Loan then held by Lenders of obtaining matching deposits in the relevant interbank market for the relevant Interest Period would be in excess of the EURO Rate, (provided, that no Lender may exercise its rights under this Section 4.2.c) for amounts up to the difference between such Lender’s cost of obtaining matching deposits on the date such Lender becomes a Lender hereunder less the EURO Rate on such date), then the Facility Agent shall give notice of such determination (hereinafter called a “Determination Notice”) to the Borrower and each of the Lenders. The Borrower, the Lenders and the Facility Agent shall then negotiate in good faith in order to agree upon a mutually satisfactory interest rate and interest period (or interest periods) to be substituted for those which would otherwise have applied under this Agreement. If the Borrower, the Lenders and the Facility Agent are unable to agree upon an interest rate (or rates) and interest period (or interest periods) prior to the date occurring fifteen (15) Business Days after the giving of such Determination Notice, the Facility Agent shall (after consultation with the Lenders) set an interest rate and an interest period (or interest periods), in each case to take effect at the end of the Interest Period current at the date of the Determination Notice, which rate (or rates) shall be equal to the sum of the Floating Rate Margin and the weighted average of the corresponding interest rates at or about 11:00 a.m. (London time) two (2) Business Days before the commencement of the relevant Interest Period on Thomson Reuters’ pages KLIEMMM, GARBIC01 and FINA01 (or such other pages as may replace Thomson Reuters’ pages KLIEMMM, GARBIC01 or FINA01 on Thomson Reuters’ service) (or, in the case of clause (c) above, the lesser of (x) the respective cost to the Lenders of funding the respective portions of the Loan held by the Lenders and (y) such weighted average). The Facility Agent shall furnish a certificate to the Borrower as soon as reasonably practicable after the Facility Agent has given such Determination Notice setting forth such rate(s). In the event that the circumstances described in this Section 4.2 shall extend beyond the end of an interest period agreed or set pursuant hereto, the foregoing procedure shall be repeated as often as may be necessary.

SECTION 4.3.    INCREASED EURO RATE LOAN COSTS, ETC. If after the Signing Date a change in any applicable treaty, law, regulation or regulatory requirement or in the interpretation thereof or in its application to the Borrower, or if compliance by any Lender with any applicable direction, request, requirement or guideline (whether or not having the force of law) of any governmental or other authority including, without limitation, any agency of the European Union or similar monetary or multinational authority insofar as it may be changed or imposed after the date hereof, shall:

i.    subject any Lender to any taxes, levies, duties, charges, fees, deductions or withholdings of any nature with respect to its portion of the Loan or any part thereof imposed, levied, collected, withheld or assessed by any jurisdiction or any

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political subdivision or taxing authority thereof (other than taxation on overall net income and, to the extent such taxes are described in Section 4.6, withholding taxes); or

ii.    change the basis of taxation to any Lender (other than a change in taxation on the overall net income of any Lender) of payments of principal or interest or any other payment due or to become due pursuant to this Agreement; or

iii.    impose, modify or deem applicable any reserve or capital adequacy requirements (other than the increased capital costs described in Section 4.5 and the reserve costs described in Section 4.7) or other banking or monetary controls or requirements which affect the manner in which a Lender shall allocate its capital resources to its obligations hereunder or require the making of any special deposits against or in respect of any assets or liabilities of, deposits with or for the account of, or loans by, any Lender (provided that such Lender shall, unless prohibited by law, allocate its capital resources to its obligations hereunder in a manner which is consistent with its present treatment of the allocation of its capital resources); or

iv.    impose on any Lender any other condition affecting its portion of the Loan or any part thereof,

and the result of any of the foregoing is either (i) to increase the cost to such Lender of making its portion of the Loan or maintaining its portion of the Loan or any part thereof, (ii) to reduce the amount of any payment received by such Lender or its effective return hereunder or on its capital or (iii) to cause such Lender to make any payment or to forego any return based on any amount received or receivable by such Lender hereunder, then and in any such case if such increase or reduction in the opinion of such Lender materially affects the interests of such Lender, (A) such Lender shall (through the Facility Agent) notify the Borrower of the occurrence of such event and use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions and the terms of the BpiFAE Insurance Policy and (if the Fixed Rate applies) the arrangements with Natixis DAI relating to the CIRR) to designate a different Lending Office if the making of such a designation would avoid the effects of such law, regulation or regulatory requirement or any change therein or in the interpretation thereof and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender and (B) the Borrower shall forthwith upon such demand pay to the Facility Agent for the account of such Lender such amount as is necessary to compensate such Lender for such additional cost or such reduction and ancillary expenses, including taxes, incurred as a result of such adjustment. Such notice shall (i) describe in reasonable detail the event leading to such additional cost, together with the approximate date of the effectiveness thereof, (ii) set forth the amount of such additional cost, (iii) describe the manner in which such amount has been calculated, (iv) certify that the method used to calculate such amount is such Lender’s standard method of calculating such amount, (v) certify that such request is consistent with its treatment of other borrowers that are subject to similar provisions, and (vi) certify that, to the best of its knowledge, such change in circumstance is of general application to the commercial banking industry in such Lender’s jurisdiction of organization or in the relevant jurisdiction in which such Lender does business. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that in relation to increased costs or reductions arising after the Effective Date the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than three months prior to the date that such Lender notifies the Borrower of the circumstance giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor; providedfurther that, if the circumstance giving rise to such increased costs or reductions is retroactive, then the three-month period referred to above shall be extended to include the period of retroactive effect thereof, but not more than six months prior to the date that such Lender notifies the Borrower of the circumstance giving rise to such cost or reductions and of such Lender’s intention to claim compensation therefor.

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It is acknowledged that the Borrower shall have no liability to compensate any Lender under this Section for amounts of increased costs that accrue before the Effective Time on the Actual Delivery Date (with any such amounts arising before the Effective Time being the responsibility of the Original Borrower).

SECTION 4.4.    FUNDING LOSSES.

SECTION 4.4.1    Indemnity. In the event any Lender shall incur any loss or expense (for the avoidance of doubt excluding loss of profit) by reason of the liquidation or re-employment (at not less than the market rate) of deposits or other funds acquired by such Lender, to make, continue or maintain any portion of the principal amount of its portion of the Loan as a result of:

i.    any repayment or prepayment or acceleration of the principal amount of such Lender’s portion of the Loan, other than any repayment made on the date scheduled for such repayment or (if the Floating Rate applies) any repayment or prepayment or acceleration on a date other than the scheduled last day of an Interest Period or otherwise scheduled date for repayment or payment; or

ii.    the relevant portion of the Loan not being made in accordance with the Loan Request therefor due to the fault of the Borrower or as a result of any of the conditions precedent set forth in clause 6.1(c) of the Novation Agreement and Article V not being satisfied, (a “Funding Losses Event”) then, upon the written notice of such Lender to the Borrower (with a copy to the Facility Agent), the Borrower shall, within three (3) days of its receipt thereof:

1.    if at that time interest is calculated at the Floating Rate on such Lender’s portion of the Loan, pay directly to the Facility Agent for the account of such Lender an amount equal to the amount by which:

(a)    interest calculated at the Floating Rate (excluding the Floating Rate Margin) which such Lender would have received on its share of the amount of the Loan subject to such Funding Losses Event for the period from the date of receipt of any part of its share in the Loan to the last day of the applicable Interest Period, exceeds:

(b)    the amount which such Lender would be able to obtain by placing an amount equal to the amount received by it on deposit with a leading bank in the appropriate interbank market for a period starting on the Business Day following receipt and ending on the last day of the applicable Interest Period; or

2.    if at that time interest is calculated at the Fixed Rate on such Lender’s portion of the Loan, pay to the Facility Agent the amount notified to it following the calculation referred to in the next paragraph.

Since the Lenders commit themselves irrevocably to the French Authorities in charge of monitoring the CIRR mechanism, any prepayment (whether voluntary, involuntary or mandatory, including following the acceleration of the Loan) will be subject to the mandatory payment by the Borrower of the amount calculated in liaison with the French Authorities two (2) Business Days prior to the prepayment date by taking into account the differential (the “Rate Differential”) between the CIRR and the prevailing market yield (currently ISDAFIX) for each installment to be prepaid and applying such Rate Differential to the remaining residual period of such installment and discounting to the net present value as described below. Each of these Rate Differentials will be applied to the corresponding installment to be prepaid during the period starting on the date on which such prepayment is required to be made and ending on the original Repayment Date (as adjusted following any previous prepayments) for such installment and:

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(a)    the net present value of each corresponding amount resulting from the above calculation will be determined at the corresponding market yield; and

(b)    if the cumulated amount of such present values is negative, no amount shall be due to the Borrower or from the Borrower.

Such written notice shall include calculations in reasonable detail setting forth the loss or expense to such Lender.

SECTION 4.4.2    Exclusion. In the event that a Lender’s wilful misconduct or gross negligence has caused the loss or cancellation of the BpiFAE Insurance Policy, the Borrower shall not be liable to indemnify that Lender under Section 4.4.1 for its loss or expense arising due to the occurrence of the Prepayment Event referred to in Section 9.1.9.

SECTION 4.5.    INCREASED CAPITAL COSTS. If after the Signing Date any change in, or the introduction, adoption, effectiveness, interpretation, reinterpretation or phase-in of, any law or regulation, directive, guideline, decision or request (whether or not having the force of law) of any court, central bank, regulator or other governmental authority increases the amount of capital required to be maintained by any Lender or any Person controlling such Lender, and the rate of return on its or such controlling Person’s capital as a consequence of its Commitment or its portion of the Loan made by such Lender is reduced to a level below that which such Lender or such controlling Person would have achieved but for the occurrence of any such change in circumstance, then, in any such case upon notice from time to time by such Lender to the Borrower, the Borrower shall immediately pay directly to such Lender additional amounts sufficient to compensate such Lender or such controlling Person for such reduction in rate of return. Any such notice shall (i) describe in reasonable detail the capital adequacy requirements which have been imposed, together with the approximate date of the effectiveness thereof, (ii) set forth the amount of such lowered return, (iii) describe the manner in which such amount has been calculated, (iv) certify that the method used to calculate such amount is such Lender’s standard method of calculating such amount, (v) certify that such request for such additional amounts is consistent with its treatment of other borrowers that are subject to similar provisions and (vi) certify that, to the best of its knowledge, such change in circumstances is of general application to the commercial banking industry in the jurisdictions in which such Lender does business. In determining such amount, such Lender may use any method of averaging and attribution that it shall, subject to the foregoing sentence, deem applicable. Each Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions and the terms of the BpiFAE Insurance Policy and (if the Fixed Rate applies) the arrangements with Natixis DAI relating to the CIRR) to designate a different Lending Office if the making of such a designation would avoid such reduction in such rate of return and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that in relation to increased costs or reductions arising after the Effective Date the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than three months prior to the date that such Lender notifies the Borrower of the circumstance giving rise to such reductions and of such Lender’s intention to claim compensation therefor; provided further that, if the circumstance giving rise to such reductions is retroactive, then the three-month period referred to above shall be extended to include the period of retroactive effect thereof, but not more than six months prior to the date that such Lender notifies the Borrower of the circumstance giving rise to such reductions and of such Lender’s intention to claim compensation therefor.

It is acknowledged that the Borrower shall have no liability to compensate any Lender under this Section for reduced returns that accrue before the Effective Time on the Actual

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Delivery Date (with any compensation liability to the Lenders arising before the Effective Time being the responsibility of the Original Borrower).

SECTION 4.6.    TAXES. All payments by an Obligor of principal of, and interest on, the Loan and all other amounts payable under any Loan Document shall be made free and clear of and without deduction for any present or future income, excise, stamp or franchise taxes and other taxes, fees, duties, withholdings or other charges of any nature whatsoever imposed by any taxing authority, but excluding franchise taxes and taxes imposed on or measured by any Lender’s net income or receipts of such Lender and franchise taxes imposed in lieu of net income taxes or taxes on receipts, by the jurisdiction under the laws of which such Lender is organized or any political subdivision thereof or the jurisdiction of such Lender’s Lending Office or any political subdivision thereof or any other jurisdiction unless such net income taxes are imposed solely as a result of the applicable Obligor’s activities in such other jurisdiction, and any taxes imposed under FATCA (such non-excluded items being called “Covered Taxes”). In the event that any withholding or deduction from any payment to be made by an Obligor under any Loan Document is required in respect of any Covered Taxes pursuant to any applicable law, rule or regulation, then the Borrower will:

v.    pay directly to the relevant authority the full amount required to be so withheld or deducted;

vi.    promptly forward to the Facility Agent an official receipt or other documentation satisfactory to the Facility Agent evidencing such payment to such authority; and

vii.    pay to the Facility Agent for the account of the Lenders such additional amount or amounts as is necessary to ensure that the net amount actually received by each Lender will equal the full amount such Lender would have received had no such withholding or deduction been required.

Moreover, if any Covered Taxes are directly asserted against the Facility Agent or any Lender with respect to any payment received or paid by the Facility Agent or such Lender hereunder, the Facility Agent or such Lender may pay such Covered Taxes and the Borrower will promptly pay such additional amounts (including any penalties, interest or expenses) as is necessary in order that the net amount received by such person after the payment of such Covered Taxes (including any Covered Taxes on such additional amount) shall equal the amount such person would have received had no such Covered Taxes been asserted.

Any Lender claiming any additional amounts payable pursuant to this Section agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions and the terms of the BpiFAE Insurance Policy and (if the Fixed Rate applies) the arrangements with Natixis DAI relating to the CIRR) to change the jurisdiction of its Lending Office if the making of such a change would avoid the need for, or reduce the amount of, any such additional amounts that may thereafter accrue and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.

If the Borrower fails to pay any Covered Taxes when due to the appropriate taxing authority or fails to remit to the Facility Agent for the account of the respective Lenders the required receipts or other required documentary evidence, the Borrower shall indemnify the Lenders for any incremental withholding Covered Taxes, interest or penalties that may become payable by any Lender as a result of any such failure (so long as such amount did not become payable as a result of the failure of such Lender to provide timely notice to the Borrower of the assertion of a liability related to the payment of Covered Taxes). For purposes of this Section 4.6, a distribution hereunder by the Facility Agent or any Lender to or for the account of any Lender shall be deemed a payment by the Borrower.

If any Lender is entitled to any refund, credit, deduction or other reduction in tax by reason of any payment made by the Borrower in respect of any Covered Tax under this

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Section 4.6 or by reason of any payment made by the Borrower pursuant to Section 4.3, such Lender shall use reasonable efforts to obtain such refund, credit, deduction or other reduction and, promptly after receipt thereof, will pay to the Borrower such amount (plus any interest received by such Lender in connection with such refund, credit, deduction or reduction) as is equal to the net after-tax value to such Lender of such part of such refund, credit, deduction or reduction as such Lender reasonably determines is allocable to such Covered Tax or such payment (less out-of-pocket expenses incurred by such Lender), provided that no Lender shall be obligated to disclose to the Borrower any information regarding its tax affairs or tax computations.

Each Lender (and each Participant) agrees with the Borrower and the Facility Agent that it will (i) in the case of a Lender or a Participant organized under the laws of a jurisdiction other than the United States (a) provide to the Facility Agent and the Borrower an appropriately executed copy of Internal Revenue Service Form W-8ECI certifying that any payments made to or for the benefit of such Lender or such Participant are effectively connected with a trade or business in the United States (or alternatively, an Internal Revenue Service Form W-8BEN claiming the benefits of a tax treaty, but only if the applicable treaty described in such form provides for a complete exemption from U.S. federal income tax withholding), or any successor form, on or prior to the date hereof (or, in the case of any Assignee Lender or Participant, on or prior to the date of the relevant assignment or participation), in each case attached to an Internal Revenue Service Form W-8IMY, if appropriate, (b) notify the Facility Agent and the Borrower if the certifications made on any form provided pursuant to this paragraph are no longer accurate and true in all material respects and (c) without prejudice to its obligations under Section 4.13, provide such other tax forms or other documents as shall be prescribed by applicable law, if any, or as otherwise reasonably requested, to demonstrate, to the extent applicable, that payments to such Lender Party (or Participant) hereunder are exempt from withholding under FATCA, and (ii) in all cases, provide such forms, certificates or other documents, as and when reasonably requested by the Borrower, necessary to claim any applicable exemption from, or reduction of, Covered Taxes or any payments made to or for benefit of such Lender Party or such Participant, provided that the Lender Party or Participant is legally able to deliver such forms, certificates or other documents. For any period with respect to which a Lender (or Assignee Lender or Participant) has failed to provide the Borrower with the foregoing forms (other than if such failure is due to a change in law occurring after the date on which a form originally was required to be provided (which, in the case of an Assignee Lender, would be the date on which the original assignor was required to provide such form) or if such form otherwise is not required hereunder) such Lender (or Assignee Lender or Participant) shall not be entitled to the benefits of this Section 4.6 with respect to Covered Taxes imposed by reason of such failure.

All fees and expenses payable pursuant to Section 11.3 shall be paid together with value added tax or any similar tax (if any) properly chargeable thereon. Any value added tax chargeable in respect of any services supplied by a Lender or an Agent under this Agreement shall, on delivery of the value added tax invoice, be paid in addition to any sum agreed to be paid hereunder.

SECTION 4.7.    RESERVE COSTS. Without in any way limiting the Borrower’s obligations under Section 4.3, the Borrower shall, with effect from the Effective Time, pay to the Facility Agent for the account of each Lender on the last day of each Interest Period, so long as the relevant Lending Office of such Lender is required to maintain reserves against “Eurocurrency liabilities” under Regulation D of the F.R.S. Board, upon notice from such Lender, an additional amount equal to the product of the following for the Loan for each day during such Interest Period:

a)    the principal amount of the Loan outstanding on such day; and

b)    the remainder of (x) a fraction the numerator of which is the rate (expressed as a decimal) at which interest accrues on the Loan for such Interest Period as

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provided in this Agreement (less, if applicable, the Floating Rate Margin) and the denominator of which is one minus any increase after the Signing Date in the effective rate (expressed as a decimal) at which such reserve requirements are imposed on such Lender minus (y) such numerator; and

c)    1/360.

Such notice shall (i) describe in reasonable detail the reserve requirement that has been imposed, together with the approximate date of the effectiveness thereof, (ii) set forth the applicable reserve percentage, (iii) certify that such request is consistent with such Lender’s treatment of other borrowers that are subject to similar provisions and (iv) certify that, to the best of its knowledge, such requirements are of general application in the commercial banking industry in the United States.

Each Lender agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions and the terms of the BpiFAE Insurance Policy and (if the Fixed Rate applies) the arrangements with Natixis DAI relating to the CIRR) to avoid the requirement of maintaining such reserves (including by designating a different Lending Office) if such efforts would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender.

SECTION 4.8.    PAYMENTS, COMPUTATIONS, ETC.

a)    Unless otherwise expressly provided, all payments by an Obligor pursuant to any Loan Document shall be made by such Obligor to the Facility Agent for the pro rata account of the Lenders entitled to receive such payment. All such payments required to be made to the Facility Agent shall be made, without set-off, deduction or counterclaim, not later than 11:00 a.m., London time, on the date due, in same day or immediately available funds through TARGET2 (or such other funds as may be customary for the settlement of international banking transactions in Euros), to such account as the Facility Agent shall specify from time to time by notice to the Borrower. Funds received after that time shall be deemed to have been received by the Lenders on the next succeeding Business Day.

b)    Each Lender hereby instructs the Facility Agent, with respect to any portion of the Loan held by such Lender, to pay directly to such Lender interest thereon at the Fixed Rate or (if the proviso to Section 5.1.10 applies) the Floating Rate, on the basis that (if the Fixed Rate applies) such Lender will, where amounts are payable to Natixis by that Lender under the Interest Stabilisation Agreement, account directly to Natixis for any such amounts payable by that Lender under the Interest Stabilisation Agreement to which such Lender is a party.

c)    The Facility Agent shall promptly (but in any event on the same Business Day that the same are received or, as contemplated in clause (a) of this Section, deemed received) remit in same day funds to each Lender its share, if any, of such payments received by the Facility Agent for the account of such Lender without any set-off, deduction or counterclaim. All interest and fees shall be computed on the basis of the actual number of days (including the first day but excluding the last day) occurring during the period for which such interest or fee is payable over a year comprised of 360 days. Whenever any payment to be made shall otherwise be due on a day which is not a Business Day, such payment shall be made on the next succeeding Business Day and such extension of time shall be included in computing interest and fees, if any, in connection with such payment.

SECTION 4.9.    REPLACEMENT LENDERS, ETC. If the Borrower shall be required to make any payment to any Lender pursuant to Section 4.2(c), 4.3, 4.4, 4.5, 4.6 or 4.7, the Borrower shall be entitled at any time (so long as no Default and no Prepayment Event shall have occurred and be continuing) within 180 days after receipt of notice from such Lender of such required payment to (a) terminate such Lender’s Commitment (where upon the Percentage of each other Lender shall automatically be adjusted to an amount equal

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to such Lender’s ratable share of the remaining Commitments), (b) prepay the affected portion of such Lender’s Loan in full, together with accrued interest thereon through the date of such prepayment (provided that the Borrower shall not terminate any Lender’s Commitment pursuant to clause (a) or prepay any such Lender pursuant to this clause (b) without replacing such Lender pursuant to the following clause (c) until a 30-day period shall have elapsed during which the Borrower and the Facility Agent shall have attempted in good faith to replace such Lender), and/or (c) replace such Lender with another financial institution reasonably acceptable to the Facility Agent and (if the Fixed Rate applies) Natixis DAI, provided that (i) each such transfer shall be either a transfer of all of the rights and obligations of the transferring Lender under this Agreement or a transfer of a portion of such rights and obligations made concurrently with another such transfer or other such transfers that together cover all of the rights and obligations of the transferring Lender under this Agreement and (ii) no Lender shall be obligated to make any such transfer as a result of a demand by the Borrower pursuant to this Section unless and until such Lender shall have received one or more payments from either the Borrower or one or more Assignee Lenders in an aggregate amount at least equal to the aggregate outstanding principal amount of the Loan owing to such Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Lender under this Agreement. Each Lender represents and warrants to the Borrower that, as of the Signing Date (or, with respect to any Lender not a party hereto on the Signing Date, on the date that such Lender becomes a party hereto), there is no existing treaty, law, regulation, regulatory requirement, interpretation, directive, guideline, decision or request pursuant to which such Lender would be entitled to request any payments under any of Sections4.3, 4.4, 4.5, 4.6 and 4.7 to or for account of such Lender.

SECTION 4.10.    SHARING OF PAYMENTS.

SECTION 4.10.1    Payments to Lenders. If a Lender (a “Recovering Lender”) receives or recovers any amount from an Obligor other than in accordance with Section 4.8 (Payments, Computations, etc.) (a “Recovered Amount”) and applies that amount to a payment due under the Loan Documents then:

a)    the Recovering Lender shall, within three (3) Business Days, notify details of the receipt or recovery to the Facility Agent;

b)    the Facility Agent shall determine whether the receipt or recovery is in excess of the amount the Recovering Lender would have been paid had the receipt or recovery been received or made by the Facility Agent and distributed in accordance with the said Section 4.8, without taking account of any taxes which would be imposed on the Facility Agent in relation to the receipt, recovery or distribution; and

c)    the Recovering Lender shall, within three (3) Business Days of demand by the Facility Agent, pay to the Facility Agent an amount (the “Sharing Payment”) equal to such receipt or recovery less any amount which the Facility Agent determines may be retained by the Recovering Lender as its share of any payment to be made, in accordance with any applicable provisions of this Agreement.

SECTION 4.10.2    Redistribution of payments. The Facility Agent shall treat the Sharing Payment as if it had been paid by the Borrower and distribute it between the Lenders (other than the Recovering Lender) (the “Sharing Lenders”) in accordance with the provisions of this Agreement towards the obligations of the Borrower to the Sharing Lenders.

SECTION 4.10.3    Recovering Lender’s rights. On a distribution by the Facility Agent under Section 4.10.2 of a payment received by a Recovering Lender from the relevant Obligor, as between that Obligor and the Recovering Lender, an amount of the Recovered Amount equal to the Sharing Payment will be treated as not having been paid by the relevant Obligor.

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SECTION 4.10.4    Reversal of redistribution If any part of the Sharing Payment received or recovered by a Recovering Lender becomes repayable and is repaid by that Recovering Lender, then:

a)    each Sharing Lender shall, upon request of the Facility Agent, pay to the Facility Agent for the account of that Recovering Lender an amount equal to the appropriate part of its share of the Sharing Payment (together with an amount as is necessary to reimburse that Recovering Lender for its proportion of any interest on the Sharing Payment which that Recovering Lender is required to pay) (the “Redistributed Amount”); and

b)    as between the relevant Obligor and each relevant Sharing Lender, an amount equal to the relevant Redistributed Amount will be treated as not having been paid by the relevant Obligor.

SECTION 4.10.5    Exceptions.

a)    This Section 4.10 shall not apply to the extent that the Recovering Lender would not, after making any payment pursuant to this Section 4.10, have a valid and enforceable claim against the relevant Obligor.

b)    A Recovering Lender is not obliged to share with any other Lender any amount which the Recovering Lender has received or recovered as a result of taking legal or arbitration proceedings, if:

i.    it notified the other Lender of the legal or arbitration proceedings; and

ii.    the other Lender had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings.

SECTION 4.11.    SET-OFF. Upon the occurrence and during the continuance of an Event of Default or a Prepayment Event, each Lender shall have, to the extent permitted by applicable law, the right to appropriate and apply to the payment of the Obligations then due and owing to it any and all balances, credits, deposits, accounts or moneys of any Obligor then or thereafter maintained with such Lender; provided that any such appropriation and application shall be subject to the provisions of Section 4.10. Each Lender agrees promptly to notify the applicable Obligor and the Facility Agent after any such set-off and application made by such Lender; provided that the failure to give such notice shall not affect the validity of such set-off and application. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of set-off under applicable law or otherwise) which such Lender may have.

SECTION 4.12.    USE OF PROCEEDS. The Borrower shall apply the proceeds of the Loan made available to the Borrower in respect of the Additional Advances for the purpose of making payments of, or reimbursing the Borrower for payments already made for, the amounts referred to in clauses 5.2, 5.3 and/or 5.4 of the Novation Agreement and, without limiting the foregoing, no proceeds of the Loan will be used to acquire any equity security of a class which is registered pursuant to Section 12 of the Securities Exchange Act of 1934 or any “margin stock”, as defined in F.R.S. Board Regulation U.

SECTION 4.13.    FATCA INFORMATION.

a)    Subject to paragraph c) below, each party (other than the Borrower) shall, within ten Business Days of a reasonable request by another party (other than the Borrower):

i.    confirm to that other party whether it is:

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1.    a FATCA Exempt Party; or

2.    not a FATCA Exempt Party;

ii.    supply to that other party such forms, documentation and other information relating to its status under FATCA as that other party reasonably requests for the purposes of that other party’s compliance with FATCA;

iii.    supply to that other party such forms, documentation and other information relating to its status as that other party reasonably requests for the purposes of that other party’s compliance with any other law, regulation, or exchange of information regime.

b)    If a party confirms to another party pursuant to paragraph (a)(i) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not or has ceased to be a FATCA Exempt Party, that party shall notify that other party reasonably promptly.

c)    Paragraph a) above shall not oblige any Lender or the Facility Agent to do anything, and paragraph a)(iii) above shall not oblige any other party to do anything, which would or might in its reasonable opinion constitute a breach of:

i.    any law or regulation;

ii.    any fiduciary duty; or

iii.    any duty of confidentiality.

d)    If a party fails to confirm whether or not it is a FATCA Exempt Party or to supply forms, documentation or other information requested in accordance with paragraph (a)(i) or (ii) above (including, for the avoidance of doubt, where paragraph (c) above applies), then such party shall be treated for the purposes of the Loan Documents (and payments under them) as if it is not a FATCA Exempt Party until such time as the party in question provides the requested confirmation, forms, documentation or other information.

e)    Each party may make a FATCA Deduction from a payment under this Agreement that it is required to be made by FATCA, and any payment required in connection with that FATCA Deduction, and no party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.

SECTION 4.14.    RESIGNATION OF THE FACILITY AGENT. The Facility Agent shall resign (and, to the extent applicable, shall use reasonable endeavours to appoint a successor Facility Agent) if, either:

a)    the Facility Agent fails to respond to a request under Section 4.13 and a Lender reasonably believes that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party;

b)    the information supplied by the Facility Agent pursuant to Section 4.13 indicates that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party; or

c)    the Facility Agent notifies the Lenders that the Facility Agent will not be (or will have ceased to be) a FATCA Exempt Party;

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and (in each case) a Lender reasonably believes that a party to this Agreement will be required to make a FATCA Deduction that would not be required if the Facility Agent were a FATCA Exempt Party, and that Lender, by notice to the Facility Agent, requires it to resign.

ARTICLE V

CONDITIONS TO BORROWING

SECTION 5.1.    ADVANCE OF THE LOAN. The obligation of the Lenders to fund the relevant portion of the Loan to be made available on the Actual Delivery Date shall be subject to the prior or concurrent satisfaction of each of the conditions precedent set forth in this Section 5.1. The Facility Agent shall advise the Lenders of the satisfaction of the conditions precedent set forth in this Section 5.1 prior to funding on the Actual Delivery Date.

SECTION 5.1.1    Resolutions, etc. The Facility Agent shall have received from the Borrower:

a)    a certificate of its Secretary or Assistant Secretary as to the incumbency and signatures of those of its officers authorized to act with respect to this Agreement and each other Loan Document and as to the truth and completeness of the attached:

(x)    resolutions of its Board of Directors then in full force and effect authorizing the execution, delivery and performance of this Agreement and each other Loan Document, and

(y)    Organic Documents of the Borrower,

and upon which certificate the Lenders may conclusively rely until the Facility Agent shall have received a further certificate of the Secretary or Assistant Secretary of the Borrower canceling or amending such prior certificate; and

b)    a Certificate of Good Standing issued by the relevant Liberian authorities in respect of the Borrower.

SECTION 5.1.2    Opinions of Counsel. The Facility Agent shall have received opinions, addressed to the Facility Agent, the Security Trustee (in relation to a) and b) below) and each Lender from:

i.    Watson Farley & Williams LLP, counsel to the Borrower, as to Liberian Law, covering the matters set forth in Exhibit B-1 hereto (and which shall be updated to include reference to the Escrow Account Security);

ii.    Norton Rose Fulbright LLP, counsel to the Facility Agent and the Lenders, covering the matters set forth in Exhibit B-2 hereto (and which shall be updated to include reference to the Escrow Account Security) and, if the BpiFAE Insurance Policy is to be re-issued or replaced on or about the Actual Delivery Date, Exhibit B-3 hereto; and

iii.    Clifford Chance US LLP, United States tax counsel to the Facility Agent for the benefit of the Lenders, covering the matters set forth in Exhibit B-4 hereto, each such opinion to be updated to take into account all relevant and applicable Loan Documents at the time of issue thereof.

SECTION 5.1.3    BpiFAE Insurance Policy. The Facility Agent or the ECA Agent shall have received the BpiFAE Insurance Policy duly issued and BpiFAE shall not have, prior to the advance of the Loan, delivered to the Facility Agent or the ECA Agent

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any notice seeking the cancellation, suspension or termination of the BpiFAE Insurance Policy or the suspension of the drawing of the Additional Advances under this Agreement.

SECTION 5.1.4    Closing Fees, Expenses, etc. The Facility Agent shall have received for its own account, or for the account of each Lender or BpiFAE, as the case may be, all fees that the Borrower shall have agreed in writing to pay to the Facility Agent (whether for its own account or for the account of any of the Lenders) that are due and owing as of the date of such funding and all invoiced expenses of the Facility Agent (including the agreed fees and expenses of counsel to the Facility Agent and the BpiFAE Premium) required to be paid by the Borrower pursuant to Section 11.3 or that the Borrower has otherwise agreed in writing to pay to the Facility Agent, in each case on or prior to the date of such funding.

SECTION 5.1.5    Compliance with Warranties, No Default, etc. Both before and after giving effect to the funding of the Loan the following statements shall be true and correct:

a)    the representations and warranties set forth in Article VI (excluding, however, those set forth in Section 6.10) shall be true and correct in all material respects except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which shall be true and correct, with the same effect as if then made; and

b)    no Default and no Prepayment Event and no event which (with notice or lapse of time or both) would become a Prepayment Event shall have then occurred and be continuing.

SECTION 5.1.6    Loan Request. The Facility Agent shall have received a Loan Request duly executed by the Borrower together with:

a)    where an Additional Advance is requested in respect of the Non-Yard Costs, the Delivery Non-Yard Costs Certificate;

b)    certified as true (by the Builder) copies of the invoice and supporting documents received by the Builder from the Borrower pursuant to Appendix C of the Construction Contract in relation to the Paid Non-Yard Costs to be financed as at the time of issue and a declaration from the Borrower in substantially the form set forth in Exhibit D hereto that the requirements for a minimum 15% French content in respect of Non-Yard Costs have been fulfilled;

c)    a copy of the final commercial invoice from the Builder showing the amount of the Contract Price (including the Non-Yard Costs and the Other Basic Contract Price Increases) and the portion thereof payable to the Builder on the Actual Delivery Date under the Construction Contract; and

d)    copies of the wire transfers for all payments by the Borrower to the Builder under the Construction Contract in respect of the Basic Contract Price to the extent not already provided as part of the drawdown conditions for drawdowns made by the Original Borrower.

SECTION 5.1.7    [Intentionally omitted].

SECTION 5.1.8    Protocol of delivery. The Facility Agent shall have received a copy of the protocol of delivery and acceptance under the Construction Contract duly signed by the Builder and the Borrower or the Nominated Owner to be notified to the Facility Agent.

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SECTION 5.1.9    Title to Purchased Vessel. The Facility Agent shall have received evidence that the Purchased Vessel is legally and beneficially owned by the Borrower or the Nominated Owner (as the case may be), free of all recorded Liens, other than Liens permitted by Section 7.2.3 and, to the extent not yet discharged, the Mortgage (as defined in the Novation Agreement).

SECTION 5.1.10    Interest Stabilisation. The ECA Agent shall have received a duly executed fixed rate approval from Natixis DAI issued to the Lenders in respect of the CIRR applicable to the Loan and shall have been informed by the French Authorities of the conditions of the interest make-up mechanisms (stabilisation du taux d’intérêt) applicable to the Loan under the applicable Interest Stabilisation Agreement in respect of the Lenders, such conditions to specify, among other things, that the CIRR has been retained under the interest make-up mechanisms applicable to the Loan.

In relation to Section 5.1.10, if a Lender (an “Ineligible Lender”) becomes ineligible or otherwise ceases to be a party to an Interest Stabilisation Agreement, it shall promptly upon becoming aware thereof (and by no later than 15 Business Days before the anticipated Actual Delivery Date) notify the Borrower, the ECA Agent and the Facility Agent.

Following receipt of such a notice, the ECA Agent (through the Facility Agent) shall give to the Borrower at least 10 Business Days’ prior notice stating if the condition precedent in Section 5.1.10 will not be satisfied due to the Ineligible Lender but would be satisfied by the replacement of the Ineligible Lender as set out below, with such replacement to take effect for the purpose of this Section on the Actual Delivery Date.

On its receipt of such notice from the ECA Agent, the Borrower shall be entitled, at any time thereafter and without prejudice to any rights and remedies it may have against such Ineligible Lender pursuant to Section 3.3.3, to replace such Ineligible Lender with another bank or financial institution reasonably acceptable to the Facility Agent, BpiFAE and Natixis DAI with effect from the Actual Delivery Date, provided that (i) each such transfer shall be either a transfer of all of the rights and obligations of the Ineligible Lender under this Agreement or a transfer of a portion of such rights and obligations made concurrently with another such transfer or other such transfers that together cover all of the rights and obligations of the Ineligible Lender under this Agreement and (ii) no Lender shall be obligated to make effective any such transfer as a result of a demand by the Borrower pursuant to this Section unless and until such Lender shall have received one or more payments from one or more Assignee Lenders in an aggregate amount equal to the aggregate outstanding principal amount of the portion of the Novated Loan Balance which, immediately following the Effective Time, would have been owing to such Lender pursuant to Section 2.3(a) had that Lender not been replaced prior to the Effective Time. The ECA Agent and the Facility Agent shall, at the request of the Borrower, use reasonable efforts to assist the Borrower in finding a bank or financial institution acceptable to the Borrower to replace such Ineligible Lender, and taking such other steps that may be reasonably required and which are within the control of the ECA Agent and the Facility Agent to assist with the satisfaction of the condition precedent in Section 5.1.10 prior to funding on the Actual Delivery Date.

Provided however the Borrower shall be entitled, without prejudice to its rights and remedies pursuant to Section 3.3.3, to elect that if at the Actual Delivery Date the condition precedent in Section 5.1.10 is not satisfied the Floating Rate should apply to the Loan, such election to be made by notice in writing to the Facility Agent not less than five (5) Business Days prior to the anticipated Actual Delivery Date in which event, subject to the approval of BpiFAE, the Loan shall bear interest at the Floating Rate and the condition set out in Section 5.1.10 shall be deemed waived by the Lenders.

The ECA Agent (through the Facility Agent) shall, promptly after the Borrower’s request, advise the Borrower whether it is aware (based solely on information obtained from Natixis DAI and other French Authorities and/or received from the Lenders at the time of any such request and without any liability on the ECA Agent for the accuracy of that information)

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that the condition precedent in Section 5.1.10 will not or may not be satisfied as required by Section 5.1.10. Escrow Account Security. The Facility Agent shall have received the Escrow Account Security duly executed by the Borrower together with a duly executed notice of charge and acknowledgement thereto executed by the Borrower and the Escrow Account Bank respectively.

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

To induce the Lenders and the Facility Agent to enter into this Agreement and to make the Loan hereunder, the Borrower represents and warrants to the Facility Agent and each Lender as set forth in this Article VI as of the Actual Delivery Date and on the Guarantee Release Date (in each case except as otherwise stated).

SECTION 6.1.    ORGANIZATION, ETC. The Borrower is a corporation validly organized and existing and in good standing under the laws of its jurisdiction of incorporation; the Borrower is duly qualified to do business and is in good standing as a foreign corporation in each jurisdiction where the nature of its business requires such qualification, except where the failure to be so qualified would not have a Material Adverse Effect; and the Borrower has full power and authority, has taken all corporate action and holds all governmental and creditors’ licenses, permits, consents and other approvals necessary to enter into each Loan Document to which it is a party and to perform the Obligations.

SECTION 6.2.    DUE AUTHORIZATION, NON-CONTRAVENTION, ETC. The execution, delivery and performance by the Borrower of this Agreement and each other Loan Document, are within the Borrower’s corporate powers, have been duly authorized by all necessary corporate action, and do not:

1.    contravene the Borrower’s Organic Documents;

2.    contravene any law or governmental regulation of any Applicable Jurisdiction except as would not reasonably be expected to result in a Material Adverse Effect;

3.    contravene any court decree or order binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect;

4.    contravene any contractual restriction binding on the Borrower or any of its property except as would not reasonably be expected to result in a Material Adverse Effect; or

5.    result in, or require the creation or imposition of, any Lien on any of the Borrower’s properties except as would not reasonably be expected to result in a Material Adverse Effect.

SECTION 6.3.    GOVERNMENT APPROVAL, REGULATION, ETC. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body or other Person is required for the due execution, delivery or performance by the Borrower of this Agreement or any other Loan Document (except for authorizations or approvals not required to be obtained on or prior to the Actual Delivery Date or that have been obtained or actions not required to be taken on or prior to the Actual Delivery Date or that have been taken). The Borrower holds all governmental licenses, permits and other approvals required to conduct its business as conducted by it on the Actual Delivery Date, except to the extent the failure to hold any such licenses, permits or other approvals would not have a Material Adverse Effect.

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SECTION 6.4.    COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrower is in compliance with all applicable Environmental Laws, except to the extent that the failure to so comply would not have a Material Adverse Effect.

SECTION 6.5.    VALIDITY, ETC. This Agreement constitutes the legal, valid and binding obligation of the Borrower enforceable in accordance with its terms, except as the enforceability hereof may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of creditors’ rights generally or by general equitable principles.

SECTION 6.6.    NO DEFAULT, EVENT OF DEFAULT OR PREPAYMENT EVENT. No Default, Event of Default or Prepayment Event has occurred and is continuing.

SECTION 6.7.    LITIGATION. There is no action, suit, litigation, investigation or proceeding pending or, to the knowledge of the Borrower, threatened against the Borrower, that (i) except as set forth in filings made by the Borrower with the SEC in the Borrower’s reasonable opinion might reasonably be expected to materially adversely affect the business, operations or financial condition of the Borrower and its Subsidiaries (taken as a whole) (collectively, “Material Litigation”) or (ii) purports to affect the legality, validity or enforceability of the Loan Documents or the consummation of the transactions contemplated hereby.

SECTION 6.8.    THE PURCHASED VESSEL. Immediately following the delivery of the Purchased Vessel to the Borrower under the Construction Contract, the Purchased Vessel will be:

a)    legally and beneficially owned by the Borrower or one of the Borrower’s wholly owned Subsidiaries,

b)    registered in the name of the Borrower or one of the Borrower’s wholly owned Subsidiaries under the Bahamian or Maltese flag or such other flag as the parties may mutually agree,

c)    classed as required by Section 7.1.4(b),

d)    free of all recorded Liens, other than Liens permitted by Section 7.2.3,

e)    insured against loss or damage in compliance with Section 7.1.5, and

f)    exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries.

SECTION 6.9.    OBLIGATIONS RANK PARI PASSU; LIENS.

a)    The Obligations rank at least pari passu in right of payment and in all other respects with all other unsecured unsubordinated Indebtedness of the Borrower other than Indebtedness preferred as a matter of law.

b)    As at the date of this Agreement, the provisions of this Agreement which permit or restrict the granting of Liens are no less favorable than the provisions permitting or restricting the granting of Liens in any other agreement entered into by the Borrower with any other person providing financing or credit to the Borrower.

SECTION 6.10.    WITHHOLDING, ETC. . As of the Signing Date, no payment to be made by the Borrower under any Loan Document is subject to any withholding or like tax imposed by any Applicable Jurisdiction.

SECTION 6.11.    NO FILING, ETC. REQUIRED. No filing, recording or registration and no payment of any stamp, registration or similar tax is necessary under the laws of any

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Applicable Jurisdiction to ensure the legality, validity, enforceability, priority or admissibility in evidence of this Agreement or the other Loan Documents (except for filings, recordings, registrations or payments not required to be made on or prior to the Actual Delivery Date or that have been made).

SECTION 6.12.    NO IMMUNITY. The Borrower is subject to civil and commercial law with respect to the Obligations. Neither the Borrower nor any of its properties or revenues is entitled to any right of immunity in any Applicable Jurisdiction from suit, court jurisdiction, judgment, attachment (whether before or after judgment), set-off or execution of a judgment or from any other legal process or remedy relating to the Obligations (to the extent such suit, court jurisdiction, judgment, attachment, set-off, execution, legal process or remedy would otherwise be permitted or exist).

SECTION 6.13.    INVESTMENT COMPANY ACT. The Borrower is not required to register as an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

SECTION 6.14.    REGULATION U. The Borrower is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stock, and no proceeds of the Loan will be used for a purpose which violates, or would be inconsistent with, F.R.S. Board Regulation U. Terms for which meanings are provided in F.R.S. Board Regulation U or any regulations substituted therefor, as from time to time in effect, are used in this Section with such meanings.

SECTION 6.15.    ACCURACY OF INFORMATION. The financial and other information (other than financial projections or other forward looking information) furnished to the Facility Agent and the Lenders in writing by or on behalf of the Borrower by its chief financial officer, treasurer or corporate controller in connection with the negotiation of this Agreement is, when taken as a whole, to the best knowledge and belief of the Borrower, true and correct and contains no misstatement of a fact of a material nature. All financial projections, if any, that have been furnished to the Facility Agent and the Lenders in writing by or on behalf of the Borrower by its chief financial officer, treasurer or corporate controller in connection with this Agreement have been or will be prepared in good faith based upon assumptions believed by the Borrower to be reasonable at the time made (it being understood that such projections are subject to significant uncertainties and contingencies, many of which are beyond the Borrower’s control, and that no assurance can be given that the projections will be realized). All financial and other information furnished to the Facility Agent and the Lenders in writing by or on behalf of the Borrower by its chief financial officer, treasurer or corporate controller after the date of this Agreement shall have been prepared by the Borrower in good faith.

SECTION 6.16.    COMPLIANCE WITH LAWS. The Borrower is in compliance with all applicable laws, rules, regulations and orders, except to the extent that the failure to so comply does not and could not reasonably be expected to have a Material Adverse Effect, and the Borrower has implemented and maintains in effect policies and procedures designed to ensure compliance by the Borrower, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions. The Borrower and its Subsidiaries and, to the knowledge of the Borrower, their respective officers, employees, directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions, in all material respects and are not knowingly engaged in any activity that would reasonably be expected to result in Borrower being designated as a Sanctioned Person. None of (a) the Borrower, any Subsidiary or to the knowledge of the Borrower or such Subsidiary any of their respective directors, officers or employees, or (b) to the knowledge of the Borrower, any agent of the Borrower or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person.

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ARTICLE VII

COVENANTS

SECTION 7.1.    AFFIRMATIVE COVENANTS. The Borrower agrees with the Facility Agent and each Lender that, from the Effective Date (or, where applicable, from such time as may be stated in any applicable provision below) until all Commitments have terminated and all Obligations have been paid in full, the Borrower will perform the obligations set forth in this Section 7.1.

SECTION 7.1.1    Financial Information, Reports, Notices etc. The Borrower will furnish, or will cause to be furnished, to the Facility Agent (with sufficient copies for distribution to each Lender) the following financial statements, reports, notices and information:

a)    as soon as available and in any event within 60 days after the end of each of the first three Fiscal Quarters of each Fiscal Year of the Borrower, a copy of the Borrower’s report on Form 10-Q (or any successor form) as filed by the Borrower with the SEC for such Fiscal Quarter, containing unaudited consolidated financial statements of the Borrower for such Fiscal Quarter (including a balance sheet and profit and loss statement) prepared in accordance with GAAP, subject to normal year-end audit adjustments;

b)    as soon as available and in any event within 120 days after the end of each Fiscal Year of the Borrower, a copy of the Borrower’s annual report on Form 10-K (or any successor form) as filed by the Borrower with the SEC for such Fiscal Year, containing audited consolidated financial statements of the Borrower for such Fiscal Year prepared in accordance with GAAP (including a balance sheet and profit and loss statement) and audited by PricewaterhouseCoopers LLP or another firm of independent public accountants of similar standing;

c)    together with each of the statements delivered pursuant to the foregoing clause (a) or (b), a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant Fiscal Quarter or Fiscal Year compliance with the covenants set forth in Section 7.2.4 (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent);

d)    as soon as possible after the occurrence of a Default or Prepayment Event, a statement of the chief financial officer of the Borrower setting forth details of such Default or Prepayment Event (as the case may be) and the action which the Borrower has taken and proposes to take with respect thereto;

e)    as soon as the Borrower becomes aware thereof, notice of any Material Litigation except to the extent that such Material Litigation is disclosed by the Borrower in filings with the SEC;

f)    as soon as the Borrower becomes aware thereof, notice of any event which, in its reasonable opinion, would be expected to materially adversely affect the business, operations or financial condition of the Borrower and its Subsidiaries taken as a whole;

g)    promptly after the sending or filing thereof, copies of all reports which the Borrower sends to all holders of each security issued by the Borrower, and all registration statements which the Borrower or any of its Subsidiaries files with the SEC or any national securities exchange;

h)    such other information respecting the condition or operations, financial or otherwise, of the Borrower or any of its Subsidiaries as any Lender through the Facility

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Agent may from time to time reasonably request (including an update to any information and projections previously provided to the Lenders where these have been prepared and are available);

i)    during the Financial Covenant Waiver Period, as soon as available and in any event within respectively five (5) Business Days, ten (10) and forty (40) days (or such other period as BpiFAE may require from time to time) after the end of each monthly, bi-monthly and quarterly period (save that the period in respect of the final quarter of each Fiscal Year shall be sixty (60) days) from the Fourth Supplement Effective Date, the information required by the Debt Deferral Extension Regular Monitoring Requirements (as such information requirements may be amended on the basis set out in the Debt Deferral Extension Regular Monitoring Requirements) (in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent);

j)    during the Financial Covenant Waiver Period, upon the request of the Facility Agent (acting on the instructions of BpiFAE), the Borrower and the Lenders shall provide information in form and substance satisfactory to BpiFAE regarding arrangements in respect of Indebtedness for borrowed money of the Group then existing or any such Indebtedness to be incurred by or made available to (as the case may be) the Group pursuant to binding commitments (such information to be provided to BpiFAE in accordance with terms of the Facility Agent’s request);

k)    during the period from the Novation Effective Time until the Covenant Modification Date, within five Business Days after the end of each month falling during such period, a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the immediately preceding month, compliance with the covenant set forth in Section 7.2.4(C); provided that if, during such period, the Borrower is not in compliance with the covenant set forth in Section 7.2.4(C) as of the last day of such month, the Borrower shall show compliance with such covenant as of the date such certificate is delivered;

l)    within 15 Business Days of the end of each month throughout the Early Warning Monitoring Period, a certificate, executed by the chief financial officer, the treasurer or the corporate controller of the Borrower, showing, as of the last day of the relevant month (i) the ratio of Adjusted Cash Balance as of the last day of the most recently completed month to the Monthly Outflow for the month most recently ended (and showing whether the Adjusted Cash Balance covers the Monthly Outflow for at least the subsequent five-month period), (ii) the Borrower’s Adjusted EBITDA After Principal and Interest for the two consecutive Last Reported Fiscal Quarters and (iii) in the case of the next certificate to be submitted immediately following the Borrower’s publishing of results for each Last Reported Fiscal Quarter, a comparison of Adjusted EBITDA After Principal and Interest with the figure from the corresponding Fiscal Quarter in the 2019 Fiscal Year (in each case in reasonable detail and with appropriate calculations and computations in all respects reasonably satisfactory to the Facility Agent);

m)    on one occasion during each calendar year from the start of the Financial Covenant Waiver Period, the environmental plan of the Borrower (and including the Group’s carbon emissions for the past two years (calculated according to methodologies defined by the IMO or any other public methodology specified by the Borrower) as required to be published pursuant to each letter of the Borrower issued pursuant to the Fourth Novation Agreement Supplement;

n)    if the Borrower intends to make a Restricted Voluntary Prepayment, not less than ten Business Days prior to the anticipated making of a Restricted Voluntary Prepayment, the Borrower shall provide written notice to the Facility Agent of that Restricted Voluntary Prepayment (which notice shall set out in reasonable detail the terms of that Restricted Voluntary Prepayment); and

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o)    during the Financial Covenant Waiver Period, as soon as the Borrower becomes aware thereof, notice (with a copy to the ECA Agent and BpiFAE) of any matter that has, or may, result in a breach of section 7.1.10,

provided that information required to be furnished to the Facility Agent under subsections (a), (b), (g) and (m) of this Section 7.1.1 shall be deemed furnished to the Facility Agent when available free of charge on the Borrower’s website at http://www.rclinvestor.com or the SEC’s website at http://www.sec.gov.

SECTION 7.1.2    Approvals and Other Consents. The Borrower will obtain (or cause to be obtained) all such governmental licenses, authorizations, consents, permits and approvals as may be required for (a) each Obligor to perform its obligations under the Loan Documents to which it is a party and (b) the operation of the Purchased Vessel in compliance with all applicable laws, except, in each case, to the extent that failure to obtain (or cause to be obtained) such governmental licenses, authorizations, consents, permits and approvals would not be expected to have a Material Adverse Effect.

SECTION 7.1.3    Compliance with Laws, etc. The Borrower will, and will cause each of its Subsidiaries to, comply in all material respects with all applicable laws, rules, regulations and orders, except (other than as described in clauses (a) and (f) below) to the extent that the failure to so comply would not have a Material Adverse Effect, which compliance shall in any case include (but not be limited to):

a)    in the case of the Borrower, the maintenance and preservation of its corporate existence (subject to the provisions of Section 7.2.6);

b)    in the case of the Borrower, maintenance of its qualification as a foreign corporation in the State of Florida;

c)    the payment, before the same become delinquent, of all taxes, assessments and governmental charges imposed upon it or upon its property, except to the extent being diligently contested in good faith by appropriate proceedings;

d)    compliance with all applicable Environmental Laws;

e)    compliance with all anti-money laundering and anti-corrupt practices laws applicable to the Borrower, including by not making or causing to be made any offer, gift or payment, consideration or benefit of any kind to anyone, either directly or indirectly, as an inducement or reward for the performance of any of the transactions contemplated by this agreement to the extent the same would be in contravention of such applicable laws; and

f)    the Borrower will maintain in effect policies and procedures designed to ensure compliance by the Borrower, its Subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions.

SECTION 7.1.4    The Purchased Vessel. The Borrower will:

a)    cause the Purchased Vessel to be exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries, provided that the Borrower or such Subsidiary may charter out the Purchased Vessel (i) to entities other than the Borrower and the Borrower’s wholly owned Subsidiaries and (ii) on a time charter with a stated duration not in excess of one year;

b)    cause the Purchased Vessel to be kept in such condition as will entitle her to classification by a classification society of recognized standing;

c)    provide the following to the Facility Agent with respect to the Purchased Vessel:

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i.    evidence as to the ownership of the Purchased Vessel by the Borrower or one of the Borrower’s wholly owned Subsidiaries; and

ii.    evidence of no recorded Liens on the Purchased Vessel, other than Liens permitted pursuant to Section 7.2.3;

d)    within seven days after the Actual Delivery Date, provide the following to the Facility Agent with respect to the Purchased Vessel:

i.    evidence of the class of the Purchased Vessel; and

ii.    evidence as to all required insurance being in effect with respect to the Purchased Vessel; and

e)    on or before the later of (i) 31 July and (ii) 30 days after its own receipt of a Statement of Compliance in each calendar year, supply, or procure the supply, to the Facility Agent (for distribution to BpiFAE and the Lenders) (in each case at the cost of the Borrower) of all information necessary in order for any Lender to comply with its obligations under the Poseidon Principles in respect of the preceding year, including, without limitation, all ship fuel oil consumption data required to be collected and reported in accordance with Regulation 22A of Annex VI (as collated and reported to the Purchased Vessel’s flag state using the verification report submitted to that flag state) and any Statement of Compliance, in each case relating to the Purchased Vessel for the preceding calendar year, provided always that such information shall be confidential information for the purposes of Section 11.15 and, accordingly, no Lender shall publicly disclose such information with the identity of the Purchased Vessel or the Borrower (or, if applicable, the Borrower’s wholly owned Subsidiary that then owns the Purchased Vessel) without the prior written consent of the Borrower (it being expressly agreed however that, in accordance with the Poseidon Principles, such information will form part of the information published regarding the relevant Lender’s portfolio climate alignment).

SECTION 7.1.5    Insurance. The Borrower will maintain or cause to be maintained with responsible insurance companies insurance with respect to the Purchased Vessel against such casualties, third-party liabilities and contingencies and in such amounts, in each case, as is customary for other businesses of similar size in the passenger cruise line industry (provided that in no event will the Borrower or any Subsidiary be required to obtain any business interruption, loss of hire or delay in delivery insurance) and will, upon request of the Facility Agent, furnish to the Facility Agent (with sufficient copies for distribution to each Lender) at reasonable intervals a certificate of a senior officer of the Borrower setting forth the nature and extent of all insurance maintained by the Borrower and certifying as to compliance with this Section.

SECTION 7.1.6    Books and Records. The Borrower will keep books and records that accurately reflect all of its business affairs and transactions and permit the Facility Agent and each Lender or any of their respective representatives, at reasonable times and intervals and upon reasonable prior notice, to visit each of its offices, to discuss its financial matters with its officers and to examine any of its books or other corporate records.

SECTION 7.1.7    BpiFAE Insurance Policy/French Authority Requirements. The Borrower shall, on the reasonable request of the ECA Agent or the Facility Agent, provide such other information as required under the BpiFAE Insurance Policy and/or the Interest Stabilisation Agreement as necessary to enable the ECA Agent or the Facility Agent to obtain the full support of the relevant French Authority pursuant to the BpiFAE Insurance Policy and/or the Interest Stabilisation Agreement (as the case may be). The Borrower must pay to the ECA Agent or the Facility Agent the amount of all reasonable costs and expenses reasonably incurred by the ECA Agent or the Facility Agent in connection with complying with a request by any French Authority for any additional

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information necessary or desirable in connection with the BpiFAE Insurance Policy or the Interest Stabilisation Agreement (as the case may be); provided that the Borrower is consulted before the ECA Agent or Natixis incurs any such cost or expense.

SECTION 7.1.8    Further Assurances in respect of the Framework. The Borrower will from time to time throughout the Financial Covenant Waiver Period, and at the request of the Facility Agent, promptly enter into good faith negotiations in respect of (a) amending this Agreement to remove the carve-out of Section 7.2.4 set out in Section 9.1.4 and/or (b) amending the financial covenants set forth in this Agreement, resetting the testing of such financial covenants and/or supplementing those financial covenants with additional financial covenants. A failure to reach an agreement under this paragraph following such good faith negotiations shall not constitute an Event of Default or a Prepayment Event.

SECTION 7.1.9    Equal Treatment with Pari Passu Creditors. The Borrower undertakes with the Facility Agent that it shall ensure (and shall procure that each other Group Member shall ensure) that the Lenders are treated equally in all respects with all other Pari Passu Creditors, and accordingly:

a)    the Borrower shall, to the extent not already entered into as at the Fourth Supplement Effective Date, enter into similar covenant amendment and replacement and mandatory prepayment arrangements to those contemplated by the Fourth Novation Agreement Supplement in respect of each ECA Financing (and for this purpose excluding any ECA Financings where the lenders under that ECA Financing do not provide their consent to such arrangements in circumstances where the arrangements contemplated in respect of that ECA Financing are on substantially the same basis as set out in this Agreement (as amended by the Fourth Novation Agreement Supplement) but including any financing which will, upon novation of the relevant facility agreement to the Borrower, become an ECA Financing) as soon as reasonably practicable after the Fourth Supplement Effective Date (with such amendments being on terms which shall not prejudice the rights of BpiFAE under this Agreement);

b)    the Borrower shall promptly upon written request, supply the Facility Agent and the ECA Agent with information (in a form and substance satisfactory to the Facility Agent and ECA Agent) regarding the status of the amendments to be entered into in accordance with paragraph (a) above;

c)    to enable the Borrower to comply with the requirements under paragraph (d) below, prior to any Group Member entering into any Restricted Credit Enhancement with a Pari Passu Creditor (other than a Restricted Credit Enhancement granted in accordance with Section 7.2.9(a)(ii)), the Borrower shall promptly notify the Facility Agent (and such notification shall include details of the new Lien or Group Member Guarantee and shall otherwise be in form and substance reasonably satisfactory to the Facility Agent); and

d)     at the same time as any relevant Restricted Credit Enhancement is provided to the relevant Pari Passu Creditor (other than a Restricted Credit Enhancement granted in accordance with Section 7.2.9(a)(ii)), the Borrower, any relevant Group Member and the Lenders shall enter into such documentation as may be necessary in the reasonable opinion of the Facility Agent to ensure that the Lenders benefit from that Restricted Credit Enhancement on the same terms as the relevant Pari Passu Creditor(s) and, where that Restricted Credit Enhancement is a Lien or a Group Member Guarantee, to share in that Lien or Group Member Guarantee on a pari passu basis (and the Lenders agree to enter into such intercreditor documentation to reflect such pari passu ranking (in a form and substance satisfactory to the Lenders (acting reasonably)) as may be required in connection with such arrangements).

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SECTION 7.1.10    Performance of shipbuilding contract obligations. During the Financial Covenant Waiver Period, the Borrower shall (and shall procure that each of its Subsidiaries shall) comply with its contractual commitments under and in respect of (i) each shipbuilding contract in existence as at the Fourth Supplement Effective Date (or which comes into existence at any time during the Financial Covenant Waiver Period) entered into with the Builder and (ii) any option agreements or similar binding contractual commitments (whether in respect of a firm order of a vessel or otherwise) in existence at the Fourth Supplement Effective Date (or which comes into existence at any time during the Financial Covenant Waiver Period) entered into by the Borrower (or any of its Subsidiaries) and the Builder in connection with the potential entry into of a shipbuilding contract at a future point in time (it being agreed that such obligation shall not require the Borrower or the relevant Subsidiary (as applicable) to exercise any option or other contractual right thereunder), save that this Section 7.1.10 shall be subject to any amendment to any such shipbuilding contract, option agreement, contract or other related document if such amendment has, in consultation with the ECA Agent (acting on the instructions of BpiFAE), been agreed between the Borrower or, as the case may be, relevant Subsidiary and the Builder.

SECTION 7.2.    NEGATIVE COVENANTS. The Borrower agrees with the Facility Agent and each Lender that, from the Effective Date until all Commitments have terminated and all Obligations have been paid and performed in full, the Borrower will perform the obligations set forth in this Section 7.2.

SECTION 7.2.1    Business Activities. The Borrower will not, and will not permit any of its Subsidiaries to, engage in any principal business activity other than those engaged in by the Borrower and its Subsidiaries on the date hereof and other business activities reasonably related, ancillary or complimentary thereto or that are reasonable extensions thereof.

SECTION 7.2.2    Indebtedness. Until the occurrence of the Guarantee Release Date (whereupon Section 7.2.2 of Exhibit N shall apply in accordance with Section 7.3), the Borrower will not permit any of the Existing Principal Subsidiaries to create, incur, assume or suffer to exist or otherwise become or be liable in respect of any Indebtedness, other than, without duplication, the following:

a)    Indebtedness secured by Liens of the type described in Section 7.2.3;

b)    Indebtedness owing to the Borrower or a direct or indirect Subsidiary of the Borrower;

c)    Indebtedness incurred to finance, refinance or refund the cost (including the cost of construction) of assets acquired after the Effective Date;

d)    Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted to be secured under Section 7.2.3(b), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter;

e)    obligations in respect of Hedging Instruments entered into for the purpose of managing interest rate, foreign currency exchange or commodity exposure risk and not for speculative purposes; and

f)    Indebtedness of Silversea Cruise Holding Ltd. and its Subsidiaries (“Silversea”) identified in Section 1 of Exhibit F hereto.

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SECTION 7.2.3    Liens. Until the occurrence of the Guarantee Release Date (whereupon Section 7.2.2 of Exhibit N shall apply in accordance with Section 7.3), the Borrower will not, and will not permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien upon any of its property, revenues or assets, whether now owned or hereafter acquired, except:

a)    Liens on assets (including, without limitation, shares of capital stock of corporations and assets owned by any corporation that becomes a Subsidiary of the Borrower after the Effective Date) acquired after the Effective Date (whether by purchase, construction or otherwise) by the Borrower or any of its Subsidiaries (other than (x) an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, after three months after the acquisition of a Vessel, owns a Vessel free of any mortgage Lien), which Liens were created solely for the purpose of securing Indebtedness representing, or incurred to finance, refinance or refund, the cost (including the cost of construction) of such assets, so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each such Lien is created within three months after the acquisition of the relevant assets;

b)    in addition to other Liens permitted under this Section 7.2.3, Liens securing Indebtedness in an aggregate principal amount, together with (but without duplication of) Indebtedness permitted under Section 7.2.2(d), at any one time outstanding not exceeding (determined at the time of creation of such Lien or the incurrence by any Existing Principal Subsidiary of such Indebtedness, as applicable) 10% of the total assets of the Borrower and its Subsidiaries (the “Lien Basket Amount”) taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter; provided, however that, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Lien Basket Amount shall be the greater of (x) 5.0% of the total assets of the Borrower and its Subsidiaries taken as a whole as determined in accordance with GAAP as at the last day of the most recent ended Fiscal Quarter and (y) $735,000,000;

c)    Liens on assets acquired after the Effective Date by the Borrower or any of its Subsidiaries (other than by (x) any Subsidiary that is an Existing Principal Subsidiary or (y) any other Principal Subsidiary which, at any time, owns a Vessel free of any mortgage Lien) so long as (i) the acquisition of such assets is not otherwise prohibited by the terms of this Agreement and (ii) each of such Liens existed on such assets before the time of its acquisition and was not created by the Borrower or any of its Subsidiaries in anticipation thereof;

d)    Liens on any asset of any corporation that becomes a Subsidiary of the Borrower (other than a corporation that also becomes a Subsidiary of an Existing Principal Subsidiary) after the Effective Date so long as (i) the acquisition or creation of such corporation by the Borrower is not otherwise prohibited by the terms of this Agreement and (ii) such Liens are in existence at the time such corporation becomes a Subsidiary of the Borrower and were not created by the Borrower or any of its Subsidiaries in anticipation thereof;

e)    Liens securing Government-related Obligations;

f)    Liens for taxes, assessments or other governmental charges or levies not at the time delinquent or thereafter payable without penalty or being diligently contested in good faith by appropriate proceedings;

g)    Liens of carriers, warehousemen, mechanics, material-men and landlords incurred in the ordinary course of business for sums not overdue by more than 60 days or being diligently contested in good faith by appropriate proceedings;

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h)    Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other forms of governmental insurance or benefits;

i)    Liens for current crew’s wages and salvage;

j)    Liens arising by operation of law as the result of the furnishing of necessaries for any Vessel so long as the same are discharged in the ordinary course of business or are being diligently contested in good faith by appropriate proceedings;

k)    Liens on Vessels that:

i.    secure obligations covered (or reasonably expected to be covered) by insurance;

ii.    were incurred in the course of or incidental to trading such Vessel in connection with repairs or other work to such Vessel; or

iii.    were incurred in connection with work to such Vessel that is required to be performed pursuant to applicable law, rule, regulation or order;

provided that, in each case described in this clause (k), such Liens are either (x) discharged in the ordinary course of business or (y) being diligently contested in good faith by appropriate proceedings;

l)    normal and customary rights of set-off upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision relating to bankers’ liens, rights of set-off or similar rights in favor of banks or other depository institutions;

m)    Liens in respect of rights of set-off, recoupment and holdback in favor of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business;

n)    Liens on cash or Cash Equivalents or marketable securities securing obligations in respect of Hedging Instruments not incurred for speculative purposes or securing letters of credit that support such obligations;

o)    deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business and deposits securing liabilities to insurance carriers under insurance or self-insurance arrangements;

p)    easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any Subsidiary;

q)    licenses, sublicenses, leases or subleases granted to other Persons not materially interfering with the conduct of the business of the Borrower or any of its Subsidiaries; and

r)    Liens on any property of Silversea identified in Section 2 of Exhibit F hereto,

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provided, however that from the Fourth Supplement Effective Date until the Guarantee Release Date, no Group Member shall be entitled to grant any Lien of the type referred to in paragraphs (a) to (d) above over any ECA Financed Vessel.

SECTION 7.2.4    Financial Condition. The Borrower will not permit:

a)    Net Debt to Capitalization Ratio, as at the end of any Fiscal Quarter, to be greater than 0.625 to 1.

b)    Fixed Charge Coverage Ratio to be less than 1.25 to 1 as at the last day of any Fiscal Quarter.

In addition, if, at any time, the Senior Debt Rating of the Borrower is less than Investment Grade as given by both Moody’s and S&P, the Borrower will not permit Stockholders’ Equity to be less than, as at the last day of any Fiscal Quarter, the sum of (i) $4,150,000,000 plus (ii) 50% of the consolidated net income of the Borrower and its Subsidiaries for the period commencing on January 1, 2007 and ending on the last day of the Fiscal Quarter most recently ended (treated for these purposes as a single accounting period, but in any event excluding any Fiscal Quarters for which the Borrower and its Subsidiaries have a consolidated net loss).

SECTION 7.2.4(A). Most favored lender with respect to Financial Covenants. During the Financial Covenant Waiver Period, if any Group Member agrees, in respect of any of its Indebtedness for borrowed money, to any new, modified or substitute financial covenants of the type, or similar to, the financial covenants set out in Section 7.2.4 above then (i) the Borrower shall notify the Facility Agent in writing within 5 Business Days of such new, modified or substitute financial covenants being agreed with the relevant creditor(s) and (ii) if required by the Lenders, the Borrower and the Lenders shall, as soon as practicable thereafter, enter into an amendment to this Agreement to incorporate the new, modified or substitute financial covenants.

SECTION 7.2.4(B). Notification of change to financial covenants.    (i) If at any time during the Financial Covenant Waiver Period, other than as notified in writing by the Borrower to the Facility Agent prior to the date of the Fourth Novation Agreement Supplement, the last day of a financial covenant waiver period under any of the agreements in respect of any of the Borrower’s other Indebtedness shall be amended such that it falls prior to September 30, 2022, the Borrower shall notify the Facility Agent and that revised date, save as provided below, shall be the last date of the Financial Covenant Waiver Period for the purposes of this Agreement.

(ii)    If, other than as notified in writing by the Borrower to the Facility Agent prior to the date of the Fourth Novation Agreement Supplement, following receipt of the notice referred to in sub-paragraph (i) above, the relevant date referred to above is then extended, the Borrower shall be entitled to notify the Facility Agent of the same and, upon receipt of that notice, such revised date or, if earlier, September 30, 2022, shall then become the final date of the Financial Covenant Waiver Period for the purposes of this Agreement.

SECTION 7.2.4(C). Minimum liquidity.     The Borrower will not allow the aggregate amount of unrestricted cash and Cash Equivalents of the Borrower and its Subsidiaries as determined in accordance with GAAP to be less than the Adjustable Amount as of (i) the last day of any calendar month from the Fourth Supplement Effective Date until the Covenant Modification Date, or (ii) if the Borrower is not in compliance with the requirements of this Section 7.2.4(C) as of the last day of any calendar month during the Financial Covenant Waiver Period (or, if earlier, prior to the Covenant Modification Date), the date the certificate required by Section 7.1.1(k) with respect to such month is delivered to the Facility Agent (it being understood that the Borrower shall not be required to comply with this Section 7.2.4(C) at any time on or after the Covenant Modification Date).

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SECTION 7.2.5    Additional Undertakings. From the effectiveness of the Third Novation Agreement Supplement, and notwithstanding anything to the contrary set out in this Agreement or any other Loan Document:

a)    First Priority Guarantee Matters. Until the occurrence of a First Priority Release Event:

(i)    the Borrower will not form, create, acquire or otherwise establish any new Subsidiaries that own, directly or indirectly, the Equity Interests of the First Priority Guarantor (and will not permit any such new Subsidiary to own, directly or indirectly, any such Equity Interests);

(ii)    the First Priority Guarantor will not form, create, acquire or otherwise establish any new Subsidiaries that own, directly or indirectly, the Equity Interests of any Principal Subsidiary (and will not permit any such new Subsidiary to own, directly or indirectly, any such Equity Interests);

(iii)    the First Priority Guarantor will not incur any additional Indebtedness for borrowed money (including any guarantees in respect of Indebtedness), except in connection with any Other Guarantees;

(iv)    neither Celebrity Cruises Holdings Inc. nor Celebrity Cruises Inc will incur any additional Indebtedness for borrowed money (including any guarantees in respect of Indebtedness), except in connection with the Secured Note Indebtedness or any Permitted Refinancing thereof; and

(v)    the Borrower shall not, and shall procure that each other Subsidiary will not, Dispose of any First Priority Assets or any Equity Interests in a Subsidiary that owns, directly or indirectly, any First Priority Assets, other than

(A)    to any other entity that is a First Priority Guarantor;

(B)    if the fair market value thereof, together with the fair market value of all other Dispositions of First Priority Assets made after the effectiveness of the Third Novation Agreement Supplement (but for this purpose excluding any Disposition of the type referred to in the foregoing clause (A) and any Disposition, the net proceeds of which are applied in accordance with the following clause (C)) is less than the sum of:

(2)    $250,000,000 plus

(3)    the fair market value of any asset (other than (1) current assets, intercompany debt or equity instruments and (2) First Priority Assets or other assets owned by another First Priority Guarantor immediately prior to acquisition) acquired by any First Priority Guarantor after the effectiveness of the Third Novation Agreement Supplement; or

(C)    if the net proceeds therefrom are applied in accordance with Section 4.09(b)(i) or 4.09(b)(iii)

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of the Secured Note Indenture, to the extent applicable at such time; provided, however, that if, within 450 days of such Disposition, any net proceeds of such Disposition have not been utilized in accordance with such provisions and are retained by the Borrower or any Subsidiary after such application (such retained net proceeds, “Excess Proceeds”), then:

(1)    if not already held by a First Priority Guarantor, such Excess Proceeds shall be promptly transferred to a First Priority Guarantor to be (x) retained in an account and on the balance sheet of that First Priority Guarantor and (y) used solely (i) for capital expenditures for the benefit of the remaining First Priority Assets or for the purposes of any asset purchase by that First Priority Guarantor or (ii) to make an offer to each ECA Guarantor in accordance with the following sub-clause (2); or

(2)    where the Borrower has elected to utilize the Excess Proceeds in the manner referred to in (ii) above, the Borrower shall make a written offer contemporaneously to each ECA Guarantor to apply such Excess Proceeds as a pro rata prepayment of the Loan and the Indebtedness under each other ECA Financing that is pari passu in right of payment to the Obligations. If any ECA Guarantor provides written notice to the Borrower within 90 days of such offer accepting such offer, the Borrower shall prepay the relevant Indebtedness notified to it within 10 Business Days (or such longer period as may be agreed with the lenders under each relevant ECA Financing being prepaid) of the date of receipt of such notice. If any ECA Guarantor fails to accept such offer within the said 90 days referred to above, then the pro rata portion of such Excess Proceeds that would have been applied to prepay the ECA Financings with respect to such ECA Guarantor if such offer was accepted shall be retained and applied in accordance with the foregoing sub-clause (1)(i).

b)    Second Priority Guarantee Matters. Until the occurrence of a Second Priority Release Event:

(i)    the Borrower will not, and will not permit any of its Subsidiaries to, form, create, acquire or otherwise establish any new Subsidiaries that own, directly or indirectly, the Equity Interests of any

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Second Priority Guarantor (and will not permit any such new Subsidiary to own, directly or indirectly, any such Equity Interests);

(ii)    no Second Priority Guarantor will form, create, acquire or otherwise establish any new Subsidiaries that own, directly or indirectly, the Equity Interests of any Principal Subsidiary (and will not permit any such new Subsidiary to own, directly or indirectly, any such Equity Interests); and

(iii)    the Borrower shall not, and shall procure that each other Subsidiary will not, Dispose of any Second Priority Assets or any Equity Interests in a Subsidiary that owns, directly or indirectly, any Second Priority Assets, other than:

(A)    to any other entity that is a Second Priority Guarantor; or

(B)    if the fair market value thereof, together with the fair market value of all other Dispositions of Second Priority Assets made after the effectiveness of the Third Novation Agreement Supplement (but for this purpose excluding any Disposition of the type referred to in the foregoing clause (A)) is less than the sum of:

(1)    $250,000,000 plus

(2)    the fair market value of any asset (other than (1) current assets, intercompany debt or equity instruments and (2) Second Priority Assets or other assets owned by another Second Priority Guarantor immediately prior to acquisition) acquired by any Second Priority Guarantor after the effectiveness of the Third Novation Agreement Supplement.

c)    Third Priority Guarantee Matters. Until the occurrence of a Third Priority Release Event:

(i)    the Borrower will not form, create, acquire or otherwise establish any new Subsidiaries that own, directly or indirectly, the Equity Interests of the Third Priority Guarantor (and will not permit any such new Subsidiary to own, directly or indirectly, any such Equity Interests);

(ii)    the Third Priority Guarantor will not form, create, acquire or otherwise establish any new Subsidiaries that own, directly or indirectly, the Equity Interests of any Principal Subsidiary (and will not permit any such new Subsidiary to own, directly or indirectly, any such Equity Interests); and

(iii)    the Borrower shall not, and shall procure that each other Subsidiary will not, Dispose of any Third Priority Assets or any Equity Interests in a Subsidiary that owns, directly or indirectly, any Third Priority Assets, other than:

(A)    to any other entity that is a Third Priority Guarantor;

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(B)    if the fair market value thereof, together with the fair market value of all other Dispositions of Third Priority Assets made after the effectiveness of the Third Novation Agreement Supplement (but for this purpose excluding any Disposition of the type referred to in the foregoing clause (A) and any Disposition, the net proceeds of which are applied in accordance with the following clause (C)) is less than the sum of:

(1)    $250,000,000 plus

(2)    the fair market value of any asset (other than (1) current assets, intercompany debt or equity instruments and (2) Third Priority Assets or other assets owned by another Third Priority Guarantor immediately prior to acquisition) acquired by any Third Priority Guarantor after the effectiveness of the Third Novation Agreement Supplement; or

(C)    if the net proceeds therefrom are applied in accordance with those provisions of the Unsecured Note Indenture and/or the definitive documentation governing the DDTL Indebtedness to the extent applicable at the time which allow the Borrower to make an offer to prepay and/or repay the debt evidenced by the Unsecured Note Indenture and/or DDTL Indebtedness, as applicable; provided that, if any such net proceeds are retained by the Borrower or any Subsidiary after such application, the Borrower shall promptly repay or redeem all or any portion of any Indebtedness that is pari passu or senior in right of payment to the Obligations and for which a Third Priority Guarantor is a guarantor, in each case, subject to the terms of the documentation governing such Indebtedness (including the DDTL Indebtedness, the Unsecured Note Indebtedness, any Bank Indebtedness, any Credit Card Obligations, the Loan and any other Indebtedness under an ECA Financing); provided, further, that any repayment of Indebtedness under any revolving credit agreement pursuant to this paragraph shall be accompanied by a corresponding permanent reduction in the related revolving credit commitments.

d)    New Guarantor Matters. In the event the Borrower or any of its Subsidiaries acquires an ECA Financed Vessel:

(i)    the Borrower will cause the applicable New Guarantor to provide:

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(A)    on or before the later of (1) 15 Business Days of the purchase of the relevant ECA Financed Vessel and (2) the Effective Time, (A) an Additional Guarantee, together with each equivalent Other Guarantee required to be provided under the terms of the other ECA Financings (as amended from time to time) and (B) all documents and information required by the Lenders in order to satisfy any applicable “know your customer” checks and any other reasonable condition precedent requirements of the Lenders (excluding, for the avoidance of doubt, legal opinions); provided that, in each case, if such New Guarantor is party to a Senior Guarantee at such time, the Facility Agent shall have contemporaneously entered into a New Guarantor Subordination Agreement; and

(ii)    until the occurrence of a Second Priority Release Event and a Third Priority Release Event:

(A)    the Borrower will not permit the applicable New Guarantor to incur any Indebtedness for borrowed money (including any guarantees in respect of Indebtedness) other than the applicable Additional Guarantee, any Other Guarantee and any Senior Guarantee;

(B)    the Borrower will not permit the Principal Subsidiary that acquires the relevant ECA Financed Vessel to incur any Indebtedness for borrowed money (including any guarantees in respect of Indebtedness);

(C)    notwithstanding any other provision of this Agreement, the Borrower will not, and shall procure that no other Subsidiary shall Dispose (whether to a Group Member or otherwise) of the relevant ECA Financed Vessel (or any equity interests in a Subsidiary that owns, directly or indirectly, such ECA Financed Vessel); provided that (1) such ECA Financed Vessel may be exclusively operated by or chartered to the Borrower or one of the Borrower’s wholly owned Subsidiaries and (2) the Borrower or such Subsidiary may charter out such ECA Financed Vessel (x) to entities other than the Borrower and the Borrower’s wholly owned Subsidiaries and (y) on a time charter with a stated duration not in excess of one year; and

(D)    notwithstanding the provisions of Sections 7.2.2 and 7.2.3, the Borrower will not, and will not permit any of its Subsidiaries to create, incur, assume or suffer to exist any Lien upon the relevant ECA Financed Vessel, other than Liens

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permitted under Section 7.2.3 that do not secure Indebtedness for borrowed money.

e)    Further Assurances. At the Borrower’s reasonable request, the Facility Agent shall execute (i) any Additional Subordination Agreement or any Subordination Agreement, in substantially the form attached hereto as Exhibit J or Exhibit K with such changes, or otherwise in form and substance, reasonably satisfactory to the Facility Agent (acting upon the instructions of the Required Lenders and BpiFAE), to ensure the required priority of the Second Priority Guarantee and the Third Priority Guarantee and (ii) any New Guarantor Subordination Agreement contemporaneously with the execution of any Senior Guarantee by a New Guarantor if such New Guarantor has granted an Additional Guarantee at such time.

f)    Amount of Indebtedness. The Borrower shall ensure that:

(i)    the maximum aggregate principal amount of Bank Indebtedness (or any Permitted Refinancing thereof) guaranteed by the Second Priority Guarantors shall not exceed, in the aggregate, $5,300,000,000 (or its equivalent in any other currency) until the occurrence of a First Priority Release Event, a Second Priority Release Event, and a Third Priority Release Event;

(ii)    the maximum aggregate principal amount of Unsecured Note Indebtedness and DDTL Indebtedness (or any Permitted Refinancing of either of them), in each case, guaranteed by the Third Priority Guarantor shall not exceed, in the aggregate, $1,700,000,000 (or its equivalent in any other currency) until the occurrence of a Third Priority Release Event;

(iii)    until the occurrence of a Second Priority Release Event, none of the Second Priority Guarantors will grant any guarantee that is pari passu with or senior to its obligations under the Second Priority Guarantee, except in connection with (A) any Bank Indebtedness or any Permitted Refinancing thereof, (B) any Credit Card Obligations or (C) any Other Guarantees, provided that each Other Guarantee shall be on terms no more favourable in any material respect (including for this purpose the priority of that guarantee) than that currently provided by that Second Priority Guarantor in connection with the relevant Indebtedness; and

(iv)    until the occurrence of a Third Priority Release Event, the Third Priority Guarantor will not grant any guarantee that is pari passu with or senior to its obligations under the Third Priority Guarantee, except in connection with (A) any Bank Indebtedness, Unsecured Note Indebtedness, DDTL Indebtedness or any Permitted Refinancing of any thereof, (B) any Credit Card Obligations or (C) any Other Guarantees, provided that each Other Guarantee shall be on terms no more favourable in any material respect (including for this purpose the priority of that guarantee) than that currently provided by the Third Priority Guarantor in connection with the relevant Indebtedness.

g)    Release of Guarantees. The Borrower agrees to give the Facility Agent written notice of the occurrence of any First Priority Release Event, Second Priority Release Event or Third Priority Release Event. The Facility Agent agrees, subject to the proviso (2) below, that:

(i)    the First Priority Guarantee shall be automatically released upon the occurrence of a First Priority Release Event;

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(ii)    the Second Priority Guarantee shall be automatically released upon the occurrence of a Second Priority Release Event;

(iii)    the Third Priority Guarantee shall be automatically released upon the occurrence of a Third Priority Release Event; and

(iv)    each Additional Guarantee shall be automatically released upon the occurrence of both a Second Priority Release Event and a Third Priority Release Event,

provided (1) in each case, and subject to the proviso (2) below, that upon the Borrower’s request, the Facility Agent shall promptly confirm in writing the release of the applicable Guarantee following the occurrence of the relevant release event and (2) where the Borrower is of the opinion that it would, if the Guarantee Release Date was to occur, be in breach of the provisions of Section 7.2.2 as set out in Exhibit N (and which would otherwise come into effect on that Guarantee Release Date) on the Guarantee Release Date, the Borrower shall be entitled, by serving written notice on the Facility Agent, to request that the Guarantee Release Date be postponed until such time as the Borrower is satisfied that it will be able to comply with the provisions of the said Section 7.2.2. Where the Borrower issues a notice pursuant to this proviso (2) it agrees that it shall use all reasonable endeavors and take all appropriate action as may be practicable at such time to enable it to comply with the said Section 7.2.2 as soon as practicable following the date that the Guarantee Release Date would have occurred but for this proviso (2) so that the Guarantee Release Date can then occur and, as soon as it is satisfied that it will be able to comply with the said Section 7.2.2 it will promptly serve a further written notice on the  Facility Agent. Upon receipt of this further notice, the provisions of this paragraph (g) shall once again apply and the Facility Agent shall then take the action required of it to enable the Guarantee Release Date to occur.

SECTION 7.2.6    Consolidation, Merger, etc. The Borrower will not, and will not permit any of its Subsidiaries to, liquidate or dissolve, consolidate with, or merge into or with, any other corporation, except:

ii.    any such Subsidiary may (i) liquidate or dissolve voluntarily into, and may merge with and into, the Borrower or any other Subsidiary, and the assets or stock of any Subsidiary may be purchased or otherwise acquired by the Borrower or any other Subsidiary or (ii) merge with and into another Person in connection with a sale or other disposition permitted by Section 7.2.7; and

iii.    so long as no Event of Default has occurred and is continuing or would occur after giving effect thereto, the Borrower or any of its Subsidiaries may merge into any other Person, or any other Person may merge into the Borrower or any such Subsidiary, or the Borrower or any of its Subsidiaries may purchase or otherwise acquire all or substantially all of the assets of any Person, in each case so long as:

1.    after giving effect thereto, the Stockholders’ Equity of the Borrower and its Subsidiaries is at least equal to 90% of such Stockholders’ Equity immediately prior thereto; and

2.    in the case of a merger involving the Borrower where the Borrower is not the surviving corporation, (and without prejudice to the provisions of Sections 3.2b) and c) and 9.1.10, which shall not restrict the proposed merger but which can still apply to the extent that the proposed merger would give rise to any of the events or circumstances contemplated by such Sections):

a.    the surviving corporation shall have assumed in writing, delivered to the Facility Agent, all of the Borrower’s obligations hereunder and under the other Loan Documents; and

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b.    the surviving corporation shall, promptly upon the request of the Facility Agent or any Lender, supply such documentation and other evidence as is reasonably requested by the Facility Agent or any Lender in order for the Facility Agent or such Lender to carry out and be satisfied it has complied with the results of all necessary “know your customer” or other similar checks under all applicable laws and regulations.

SECTION 7.2.7    Asset Dispositions, etc. Subject to Section 7.2.5, the Borrower will not, and will not permit any of its Subsidiaries to, sell, transfer, contribute or otherwise convey, or grant options, warrants or other rights with respect to, all or substantially all of the assets of (a) the Borrower or (b) the Subsidiaries of the Borrower, taken as a whole, except sales of assets between or among the Borrower and Subsidiaries of the Borrower.

SECTION 7.2.8    Borrower’s Procurement Undertaking. Where any of the covenants set out in this Agreement require performance by any Subsidiary of the Borrower, the Borrower shall procure the performance of that obligation by such Subsidiary.

SECTION 7.2.9    Framework Lien and Guarantee Restriction. From the Fourth Supplement Effective Date until the Guarantee Release Date, and without prejudice to Section 7.2.3, the Borrower shall not (and shall procure that each other Group Member shall not, save in respect of a Restricted Credit Enhancement of the type referred to in Section 7.1.9(d) (and in respect of which the Lenders therefore receive the benefit)):

a)    grant any Restricted Credit Enhancement in respect of any Indebtedness for borrowed money, provided that:

(i)     subject to the limitations set out in paragraph (b) below, this paragraph (a) shall not prohibit any Group Member from providing any Lien or Group Member Guarantee in connection with Indebtedness incurred after the Fourth Supplement Effective Date (provided that such Lien and/or Group Member Guarantee is issued at the same time, and in connection with, the initial incurrence of that Indebtedness (and is therefore not by way of additional credit support));

(ii)    in connection with a Permitted Refinancing of any Indebtedness, the relevant Group Member shall be entitled to provide the creditors under that Permitted Refinancing with Liens and/or Group Member Guarantees (as applicable) which:

(A)    in the case where the existing Indebtedness being refinanced was previously supported by Liens, the Liens and/or the Group Member Guarantees securing or supporting the Permitted Refinancing (as applicable) are over some or all of the same assets and

(1)    with respect to any Liens, are with the same or lower priority as the Liens in respect of such assets that secured the Indebtedness being refinanced; and    

(2)     with respect to any Group Member Guarantees, are Group Member Guarantees provided by a Group Member that owns (directly or indirectly) only those Vessels (or some of those Vessels but not any other Vessel) that were previously secured pursuant to the Liens referred to in the first sentence of this paragraph (A); and

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(B)    in the case where the existing Indebtedness being refinanced was previously supported by any Group Member Guarantee, the Group Member Guarantee(s) supporting such Permitted Refinancing are:

(1)    guarantees of obligations in an amount no greater than the guarantees granted in connection with the original Indebtedness being refinanced;

(2)    in the case where the entity providing the relevant Group Member Guarantee(s) supporting such Permitted Refinancing is the same entity providing the Group Member Guarantees that are being replaced, provided by entities owning (directly or indirectly) only those Vessels (or some of those Vessels but not any other Vessel) that it owned when the previous Group Member Guarantee was provided;

(3)    in the case where the entity providing the relevant Group Member Guarantee(s) supporting such Permitted Refinancing differs from the entity providing the Group Member Guarantees being replaced, provided by entities that directly or indirectly own Vessels with an aggregate book value no greater than the Vessels that were owned (directly or indirectly) by the previous provider of the relevant Group Member Guarantee(s) that supported the existing Indebtedness; and

(4)    the same or lower priority as the original Group Member Guarantee(s) and are issued by either the same entities or from shareholders of those entities,

provided that this paragraph (a) shall not prohibit any Group Member from providing or maintaining any Lien in accordance with the provisions of Section 7.2.3(d) through to (q) inclusive, provided, however, that the proviso at the end of Section 7.2.3(d) shall apply with respect to Liens granted pursuant to that provision; and

b)    incur any new Indebtedness (including Indebtedness of the type referred to in paragraph (a)(i) above but excluding any Permitted Refinancing Indebtedness in connection with paragraph (a)(ii) above) which is secured by a Lien or is supported by a Group Member Guarantee and which, when taken with all other Indebtedness incurred by the Group since the Fourth Supplement Effective Date and which is also secured by a Lien or supported by a Group Member Guarantee, is greater than $1,300,000,000 (but deducting from this amount for this purpose, (i) the amount of any additional Indebtedness incurred by the Borrower in connection with the drawing of the DDTL Indebtedness (whether pursuant to the accordion option or otherwise) or (ii) any Indebtedness borrowed in lieu of the drawing of the DDTL Indebtedness in the foregoing clause) or its equivalent in any other currency, and provided that no Group Member shall, as contemplated by the proviso to Section 7.2.3, from the Fourth Supplement Effective Date until the Guarantee Release Date (whereupon the relevant provisions of Exhibit N shall apply) be permitted to grant any Lien over an ECA Financed Vessel as security for any Indebtedness permitted to be incurred under this Agreement after the Fourth Supplement Effective Date.

SECTION 7.3.    COVENANT REPLACEMENT.

With effect on and from the Guarantee Release Date, it is agreed that Sections 7.2.2 and 7.2.3 shall be deleted in their entirety and replaced with the covenants and other

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provisions set out in Exhibit N, which shall become part of this Agreement and effective and binding on all Parties.

SECTION 7.4.    LENDER INCORPORATED IN THE FEDERAL REPUBLIC OF GERMANY. The representations and warranties and covenants given in Sections 6.16 and 7.1.3(f) respectively shall only be given, and be applicable to, a Lender incorporated in the Federal Republic of Germany insofar as the giving of and compliance with such representations and warranties do not result in a violation of or conflict with section 7 of the German Foreign Trade Regulation (Außenwirtschaftsverordnung) (in conjunction with section 4 paragraph 1 a no.3 foreign trade law (AWG) (Außenwirtschaftsgesetz)), any provision of Council Regulation (EC) 2271/1996 or any similar applicable anti-boycott law or regulation.

ARTICLE VIII

EVENTS OF DEFAULT

SECTION 8.1.    LISTING OF EVENTS OF DEFAULT. Each of the following events or occurrences described in this Section 8.1 shall constitute an “Event of Default”.

SECTION 8.1.1    Non-Payment of Obligations. The Borrower shall default in the payment when due of any amount payable by it under the Loan Documents in the manner required under the Loan Documents unless such failure is solely as a result of either (a) administrative or technical error or (b) a Disruption Event, and, in either case, payment is made within 3 Business Days of its due date.

SECTION 8.1.2    Breach of Warranty. Any representation or warranty of the Borrower made or deemed to be made hereunder (including any certificates delivered pursuant to Article V) or under any other Loan Document is or shall be incorrect in any material respect when made.

SECTION 8.1.3    Non-Performance of Certain Covenants and Obligations. The Borrower shall default in the due performance and observance of any other agreement contained herein (including, from the Guarantee Release Date, Exhibit N) or in any other Loan Document (other than the covenants set forth in Section 7.1.1(i), Section 7.1.1(l), Section 7.1.1(m), Section 7.1.1(n), Section 7.1.1(o), Section 7.1.4(e), Section 7.1.8, Section 7.1.10 and Section 7.2.4 (but excluding Sections 7.2.4(A) and 7.2.4(B) (which shall be regulated in accordance with Section 9.1.11(d)) and also excluding Section 7.2.4(C), a breach of which shall, subject to the cure periods set out in this Section 8.1.3, result in an Event of Default) and the obligations referred to in Section 8.1.1) and such default shall continue unremedied for a period of five days after notice thereof shall have been given to the Borrower by the Facility Agent or any Lender (or, if (a) such default is capable of being remedied within 30 days (commencing on the first day following such five-day period) and (b) the Borrower is actively seeking to remedy the same during such period, such default shall continue unremedied for at least 35 days after such notice to the Borrower).

SECTION 8.1.4    Default on Other Indebtedness. (a) The Borrower or any of its Principal Subsidiaries shall fail to pay any Indebtedness that is outstanding in a principal amount of at least $100,000,000 (or the equivalent in other currencies) in the aggregate (but excluding Indebtedness hereunder or with respect to Hedging Instruments) when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such Indebtedness; (b) the occurrence under any Hedging Instrument of an Early Termination Date (as defined in such Hedging Instrument) resulting from (A) any event of default under such Hedging Instrument as to which the Borrower is the Defaulting Party (as

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defined in such Hedging Instrument) or (B) any Termination Event (as so defined) as to which the Borrower is an Affected Party (as so defined) and, in either event, the termination value with respect to any such Hedging Instrument owed by the Borrower as a result thereof is greater than $100,000,000 and the Borrower fails to pay such termination value when due after applicable grace periods; or (c) any other event shall occur or condition shall exist under any agreement or instrument evidencing, securing or relating to any such Indebtedness and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of such event or condition is to cause or permit the holder or holders of such Indebtedness to cause such Indebtedness to become due and payable prior to its scheduled maturity; or (d) any such Indebtedness shall be declared to be due and payable or required to be prepaid or redeemed (other than by a regularly scheduled required prepayment or redemption or by voluntary agreement), purchased or defeased, or an offer to prepay, redeem, purchase or defease such Indebtedness is required to be made, in each case prior to the scheduled maturity thereof (other than as a result of any sale or other disposition of any property or assets under the terms of such Indebtedness); provided that any required prepayment or right to require prepayment triggered by terms that are certified by the Borrower to be unique to, but customary in, ship financings shall not constitute an Event of Default under this Section 8.1.4 so long as any required prepayment is made when due. For purposes of determining Indebtedness for any Hedging Instrument, the principal amount of the obligations under any such instrument at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the Borrower or any Principal Subsidiary would be required to pay if such instrument were terminated at such time.

SECTION 8.1.5    Bankruptcy, Insolvency, etc. The Borrower, any of the Material Guarantors or any of the Principal Subsidiaries (or any of its other Subsidiaries to the extent that the relevant event described below would have a Material Adverse Effect) shall:

i.    generally fail to pay, or admit in writing its inability to pay, its debts as they become due;

ii.    apply for, consent to, or acquiesce in, the appointment of a trustee, receiver, sequestrator or other custodian for it or any of its property, or make a general assignment for the benefit of creditors;

iii.    in the absence of such application, consent or acquiescence, permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for it or for a substantial part of its property, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days, provided that in the case of such an event in respect of the Borrower or any Material Guarantor, such Person hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any relevant proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents;

iv.    permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law, or any dissolution, winding up or liquidation proceeding, in respect of the Borrower, any Material Guarantor or any of such Subsidiaries, and, if any such case or proceeding is not commenced by the Borrower, such Material Guarantor or such Subsidiary, such case or proceeding shall be consented to or acquiesced in by the Borrower, such Material Guarantor or such Subsidiary or shall result in the entry of an order for relief or shall remain for 60 days undismissed, provided that the Borrower and each Material Guarantor hereby expressly authorizes the Facility Agent and each Lender to appear in any court conducting any such case or proceeding during such 60-day period to preserve, protect and defend their respective rights under the Loan Documents; or

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v.    take any corporate action authorizing, or in furtherance of, any of the foregoing.

SECTION 8.2.    ACTION IF BANKRUPTCY. If any Event of Default described in clauses (ii) through (iv) of Section 8.1.5 shall occur with respect to any Group Member, the Commitments (if not theretofore terminated) shall automatically terminate and the outstanding principal amount of the Loan and all other Obligations shall automatically be and become immediately due and payable, without notice or demand.

SECTION 8.3.    ACTION IF OTHER EVENT OF DEFAULT. If any Event of Default (other than any Event of Default described in clauses (ii) through (iv) of Section 8.1.5 with respect to a Group Member) shall occur for any reason, whether voluntary or involuntary, and be continuing, the Facility Agent, upon the direction of the Required Lenders (after consultation with BpiFAE who shall have the right to instruct the Lenders to waive such Event of Default), shall by notice to the Borrower declare all of the outstanding principal amount of the Loan and other Obligations to be due and payable and/or the Commitments (if not theretofore terminated) to be terminated, whereupon the full unpaid amount of the Loan and other Obligations shall be and become immediately due and payable, without further notice, demand or presentment, and/or, as the case may be, the Commitments shall terminate.

ARTICLE IX

PREPAYMENT EVENTS

SECTION 9.1.    LISTING OF PREPAYMENT EVENTS. Each of the following events or occurrences described in this Section 9.1 shall constitute a “Prepayment Event”.

SECTION 9.1.1    Change of Control. There occurs any Change of Control.

SECTION 9.1.2    Unenforceability. Any Loan Document shall cease to be the legally valid, binding and enforceable obligation of the Borrower or, to the extent applicable, any Material Guarantor (in each case, other than with respect to provisions of any Loan Document (i) identified as unenforceable in the form of the opinion of the Borrower’s counsel set forth as Exhibit B-1 or in any opinion delivered to the Facility Agent after the Signing Date in connection with this Agreement or (ii) that a court of competent jurisdiction has determined are not material) and such event shall continue unremedied for 15 days after notice thereof has been given to the Borrower by the Facility Agent.

SECTION 9.1.3    Approvals. Any material license, consent, authorization, registration or approval at any time necessary to enable the Borrower, any Material Guarantor or any Principal Subsidiary to conduct its business shall be revoked, withdrawn or otherwise cease to be in full force and effect, unless the same would not have a Material Adverse Effect.

SECTION 9.1.4    Non-Performance of Certain Covenants and Obligations. The Borrower shall default in the due performance and observance of any of the covenants set forth in Sections 4.12, 7.1.1(m), 7.1.4(e) or 7.2.4 (but excluding Section 7.2.4(C)), and, in the case of Sections 7.1.1(m) and 7.1.4(e), such default shall continue unremedied for a period of five days after notice thereof shall have been given to the Borrower by the Facility Agent or any Lender (or, if (a) such default is capable of being remedied within 30 days (commencing on the first day following such five-day period) and (b) the Borrower is actively seeking to remedy the same during such period, such default shall continue unremedied for at least 35 days after such notice to the Borrower), provided that any such default in respect of Section 7.2.4 (but again excluding Section 7.2.4(C)), that occurs during the Financial Covenant Waiver Period (but without prejudice to the rights of the Lenders in respect of any further breach that may occur following the

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expiry of the Financial Covenant Waiver Period) shall not (as long as no Event of Default under Section 8.1.5 has occurred and is continuing, or no Prepayment Event under Section 9.1.11 or 9.1.12 has occurred, in each case during the Financial Covenant Waiver Period) constitute a Prepayment Event..

SECTION 9.1.5    Judgments. Any judgment or order for the payment of money in excess of $100,000,000 shall be rendered against the Borrower or any of the Principal Subsidiaries by a court of competent jurisdiction and the Borrower or such Principal Subsidiary shall have failed to satisfy such judgment and either:

a)    enforcement proceedings in respect of any material assets of the Borrower or such Principal Subsidiary shall have been commenced by any creditor upon such judgment or order and shall not have been stayed or enjoined within five (5) Business Days after the commencement of such enforcement proceedings; or

b)    there shall be any period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect.

SECTION 9.1.6    Condemnation, etc.. The Purchased Vessel shall be condemned or otherwise taken under color of law or requisitioned and the same shall continue unremedied for at least 20 days, unless such condemnation or other taking would not have a Material Adverse Effect.

SECTION 9.1.7    Arrest. The Purchased Vessel shall be arrested and the same shall continue unremedied for at least 20 days, unless such arrest would not have a Material Adverse Effect.

SECTION 9.1.8    Sale/Disposal of the Purchased Vessel. The Purchased Vessel is sold to a company which is not the Borrower or any other Subsidiary of the Borrower (other than for the purpose of a lease back to the Borrower or any other Subsidiary of the Borrower).

SECTION 9.1.9    BpiFAE Insurance Policy. The BpiFAE Insurance Policy is cancelled for any reason or ceases to be in full force and effect.

SECTION 9.1.10    Illegality. No later than the close of business on the last day of the Option Period related to the giving of any Illegality Notice by an affected Lender pursuant to Section 3.2(b), either: (x) the Borrower has not elected to take an action specified in clause (1) or (2) of Section 3.2(c) or (y) if any such election shall have been made, the Borrower has failed to take the action required in respect of such election. In such circumstances the Facility Agent (at the direction of the affected Lender) shall by notice to the Borrower require the Borrower to prepay in full all principal and interest and all other Obligations owing to such Lender either (i) forthwith or, as the case may be, (ii) on a future specified date not being earlier than the latest date permitted by the relevant law.

SECTION 9.1.11    Framework Prohibited Events

a)    The Borrower declares, pays or makes or agrees to pay or make, directly or indirectly, any Restricted Payment, except for (i) dividends or other distributions with respect to its Equity Interests payable solely in additional shares of its Equity Interests or options to purchase Equity Interests, (ii) Restricted Payments pursuant to and in accordance with stock option plans or other benefit plans (including with respect to performance shares issued in the ordinary course of business) for present or former officers, directors, consultants or employees of the Borrower in the ordinary course of business consistent with past practice and (iii) the payment of cash in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exercisable for Equity Interests of the Borrower;

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b)    a Group Member makes any payment of any kind under any shareholder loan;

c)    a Group Member sells, transfers, leases or otherwise disposes of any its assets, whether by one or a series of related transactions and that disposal or action was not conducted on arms' length terms between a willing seller and a willing buyer and for fair market value;

d)    any Group Member breaches any of the requirements of Section 7.1.1(i), Section 7.1.1(l), Section 7.1.1(n), Section 7.1.1(o), Section 7.1.8, Section 7.1.10, Section 7.2.4(A) or Section 7.2.4(B);

e)    a Group Member completes a Debt Incurrence;

f)    a Group Member enters into a Restricted Loan Arrangement; and/or

g)    a Group Member makes a Restricted Voluntary Prepayment and the Facility Agent (acting upon the instructions of BpiFAE) notifies the Borrower that BpiFAE has confirmed that the Financial Covenant Waiver Period shall come to an end.

SECTION 9.1.12    Breach of Principles and Framework. The Borrower shall default in the due performance and observance of the Principles and/or the Framework (it being agreed that if there is inconsistency between the terms of the Principles and the Framework, the Framework shall prevail) and, if capable of remedy, such default shall continue unremedied for a period of ten (10) days after notice thereof shall have been given to the Borrower by the Facility Agent, provided that, if the default does not otherwise constitute a Default or a Prepayment Event under another section of this Agreement as amended to date, the Borrower, the Facility Agent, the ECA Agent and BpiFAE shall negotiate a resolution in good faith for a maximum period of fifteen (15) days after notice thereof shall have been given to the Borrower by the Facility Agent.

SECTION 9.2.    MANDATORY PREPAYMENT. If any Prepayment Event (other than a Prepayment Event under Section 9.1.10) shall occur and be continuing, the Facility Agent, upon the direction of the Required Lenders, shall by notice to the Borrower require the Borrower to prepay in full on the date of such notice all principal of and interest on the Loan and all other Obligations (and, in such event, the Borrower agrees to so pay the full unpaid amount of the Loan and all accrued and unpaid interest thereon and all other Obligations), provided that in the case of a Prepayment Event arising under Sections 9.1.11 or 9.1.12, such Prepayment Event shall not give rise to an entitlement on the part of the Lenders to terminate the Commitments or, where the Loan has been advanced, to require that the Loan is prepaid but instead, where a notice is given by the Facility Agent pursuant to this Section 9.2 following the occurrence of a Prepayment Event under either Section 9.1.11 or 9.1.12, the waiver of Section 7.2.4 contained in Section 9.1.4 shall immediately cease such that any breach of Section 7.2.4 in existence as at the date of the notice from the Facility Agent referred to in the first sentence of this Section 9.2 or any breach occurring at any time after such notice shall constitute a Prepayment Event with all attendant consequences.

SECTION 9.3.    MITIGATION. If the ECA Agent, the Facility Agent or any of the Lenders become aware that an event or circumstance has arisen which will cause the BpiFAE Insurance Policy to be cancelled for any reason or no longer remain in full force and effect they shall notify the Borrower and the Lenders, the Borrower, the ECA Agent and the Facility Agent shall negotiate in good faith for a period of up to 30 days or, if less, the date by which the BpiFAE Insurance Policy shall be terminated or cease to be in full force and effect to determine whether the facility can be restructured and/or the Loan refinanced in a manner acceptable to each of the Lenders in their absolute discretion. The Lenders will use reasonable efforts to involve BpiFAE in such negotiations.

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ARTICLE X

THE FACILITY AGENT AND THE ECA AGENT

SECTION 10.1.    ACTIONS. Each Lender hereby appoints Citibank Europe plc, UK Branch, as Facility Agent and SMBC Bank International plc as ECA Agent, as its agent under and for purposes of this Agreement and each other Loan Document (for purposes of this Article X, the Facility Agent and the ECA Agent are referred to collectively as the “Agents”). Each Lender authorizes the Agents to act on behalf of such Lender under this Agreement and each other Loan Document and, in the absence of other written instructions from the Required Lenders received from time to time by the Agents (with respect to which each Agent agrees that it will comply, except as otherwise provided in this Section 10.1 or as otherwise advised by counsel or as otherwise instructed by any French Authority, it being understood and agreed that any instructions provided by a French Authority shall prevail), to exercise such powers hereunder and thereunder as are specifically delegated to or required of the Agents by the terms hereof and thereof, together with such powers as may be reasonably incidental thereto. Neither Agent shall be obliged to act on the instructions of any Lender or the Required Lenders if to do so would, in the opinion of such Agent, be contrary to any provision of this Agreement or any other Loan Document or the BpiFAE Insurance Policy or to any law or the conflicting instructions of any French Authority, or would expose such Agent to any actual or potential liability to any third party. As between the Lenders and the Agents, it is acknowledged that each Agent’s duties under this Agreement and the other Loan Documents are solely mechanical and administrative in nature.

SECTION 10.2.    INDEMNITY. Each Lender hereby indemnifies (which indemnity shall survive any termination of this Agreement) each Agent, pro rata according to such Lender’s Percentage, from and against any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and disbursements of counsel) that be incurred by or asserted or awarded against, such Agent in any way relating to or arising out of this Agreement and any other Loan Document or any action taken or omitted by such Agent under this Agreement or any other Loan Document; provided that no Lender shall be liable for the payment of any portion of such claims, damages, losses, liabilities and expenses which have resulted from such Agent’s gross negligence or willful misconduct. Without limitation of the foregoing, each Lender agrees to reimburse each Agent promptly upon demand for its ratable share of any out-of-pocket expenses (including reasonable counsel fees) incurred by such Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, to the extent that such Agent is not reimbursed for such expenses by the Borrower. In the case of any investigation, litigation or proceeding giving rise to any such indemnified costs, this Section applies whether any such investigation, litigation or proceeding is brought by any Agent, any Lender or a third party. Neither Agent shall be required to take any action hereunder or under any other Loan Document, or to prosecute or defend any suit in respect of this Agreement or any other Loan Document, unless it is expressly required to do so under this Agreement or is indemnified hereunder to its satisfaction. If any indemnity in favor of an Agent shall be or become, in such Agent’s determination, inadequate, such Agent may call for additional indemnification from the Lenders and cease to do the acts indemnified against hereunder until such additional indemnity is given.

SECTION 10.3.    FUNDING RELIANCE, ETC.

a)    Each Lender shall notify the Facility Agent by 4:00 p.m., London time, one day prior to the advance of the Loan if it is not able to fund the following day. Unless the Facility Agent shall have been notified by telephone, confirmed in writing, by any Lender by 4:00 p.m., London time, on the day prior to the advance of the Loan that such Lender will not make available the amount which would constitute its Percentage of the Loan on the date specified therefor, the Facility Agent may assume that such Lender has made such amount available to the Facility Agent and, in reliance upon such assumption, may, but

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shall not be obliged to, make available to the Borrower a corresponding amount. If and to the extent that such Lender shall not have made such amount available to the Facility Agent, such Lender and the Borrower severally agree to repay the Facility Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date the Facility Agent made such amount available to the Borrower to the date such amount is repaid to the Facility Agent, at the interest rate applicable at the time to the Loan without premium or penalty.

b)    

(i)    Where a sum is to be paid to an Agent under the Finance Documents for another party to this Agreement, that Agent is not obliged to pay that sum to that other party (or to enter into or perform any related exchange contract) until it has been able to establish to its satisfaction that it has actually received that sum

(ii)    Unless paragraph (iii) below applies, if an Agent or its Affiliate or representative on its behalf or at its direction in performing the role of Agent (that Agent and its applicable Affiliate or representative being an “Agent Entity”) pays an amount to another party to this Agreement (unless sub-paragraph (iii) below applies) or, at the direction of such party, that party’s Affiliate, related fund or representative (such other party and its applicable Affiliate, related fund or representative being an “Other Party Entity”) and it proves to be the case (and for this purpose a statement of the relevant Agent given in good faith shall be prima facie evidence of this) that (A) neither that Agent nor the applicable Agent Entity actually received that amount or (B) such amount was otherwise paid in error (whether such error was known or ought to have been known to such other party or applicable Other Party Entity), then the party to whom that amount (or the proceeds of any related exchange contract) was paid (or on whose direction its applicable Other Party Entity was paid) by the applicable Agent Entity shall hold such amount on trust or, to the extent not possible as a matter of law, for the account (or will procure that its applicable Other Party Entity holds on trust or for the account) of the Agent Entity and on demand (or will procure that its applicable Other Party Entity shall on demand) refund the same to the Agent Entity together with interest on that amount from the date of payment to the date of receipt by the Agent Entity, calculated by the Agent to reflect its cost of funds.

(iii)    If an Agent, upon the Borrower’s written request, is willing to make available amounts for the account of the Borrower before receiving funds from the Lenders then, if and to the extent that such Agent does so but it proves to be the case (and for this purpose a statement of the relevant Agent given in good faith shall be prima facie evidence of this) that it does not then receive funds from a Lender (such Lender being a “Defaulting Lender”) in respect of such sum which it paid to the Borrower (or as it may direct) then: (A) the Agent shall notify (and the Lenders expressly acknowledge that the Agent shall be entitled to so notify) the Borrower of the identity of the Defaulting Lender; (B) without prejudice to any rights of the Borrower against the Defaulting Lender under this Agreement (including, without limitation, in relation to any amounts required to be paid by the Borrower under sub-paragraph (C) below) the Borrower shall (or shall procure that its applicable Other Party Entity to whom such amount was paid shall) hold such amount on trust or, to the extent not possible as a matter of law, for the account, of the relevant Agent and on demand refund it to that Agent; and (C) the Defaulting Lender by whom those funds should have been made available or, if that Defaulting Lender fails to do so (and having regard to paragraph (iv) below), the Borrower shall on demand pay to the relevant

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Agent the amount (as certified by that Agent) which will indemnify the Agent against any funding cost incurred by it as a result of paying out that sum before receiving those funds from the Defaulting Lender

(iv)    It is expressly acknowledged and agreed that, without prejudice to the requirement of the Borrower to make the payments referred to in paragraphs (ii) and (iii) above:

(A) the Borrower shall not be obliged to pay interest for the account of the Defaulting Lender on the part of the Loan that was not made available by that Defaulting Lender but which was pre-funded by the relevant Agent pursuant to this Section 10.3(b); and

(B) the Defaulting Lender shall indemnify the Borrower for any costs, losses or liabilities incurred by the Borrower arising from the Defaulting Lender’s failure to make any payment under sub-Section (iii) above.

SECTION 10.4.    EXCULPATION. Neither of the Agents nor any of their respective directors, officers, employees or agents shall be liable to any Lender for any action taken or omitted to be taken by it under this Agreement or any other Loan Document, or in connection herewith or therewith, except for its own willful misconduct or gross negligence. Without limitation of the generality of the foregoing, each Agent (i) may consult with legal counsel (including counsel for the Borrower), independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it and in accordance with the advice of such counsel, accountants or experts, (ii) makes no warranty or representation to any Lender and shall not be responsible to any Lender for any statements, warranties or representations (whether written or oral) made in or in connection with this Agreement, (iii) shall not have any duty to ascertain or to inquire as to the performance, observance or satisfaction of any of the terms, covenants or conditions of this Agreement on the part of the Obligors or the existence at any time of any Default or Prepayment Event or to inspect the property (including the books and records) of the Obligors, (iv) shall not be responsible to any Lender for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other instrument or document furnished pursuant hereto, (v) shall incur no liability under or in respect of this Agreement by action upon any notice, consent, certificate or other instrument or writing (which may be by telecopier) believed by it to be genuine and signed or sent by the proper party or parties, and (vi) shall have no responsibility to the Borrower or any Lender on account of (A) the failure of a Lender or the Obligors to perform any of its obligations under this Agreement or any Loan Document; (B) the financial condition of the Obligors; (C) the completeness or accuracy of any statements, representations or warranties made in or pursuant to this Agreement or any Loan Document, or in or pursuant to any document delivered pursuant to or in connection with this Agreement or any Loan Document; or (D) the negotiation, execution, effectiveness, genuineness, validity, enforceability, admissibility in evidence or sufficiency of this Agreement or any Loan Document or of any document executed or delivered pursuant to or in connection with any Loan Document.

SECTION 10.5.    SUCCESSOR. The Facility Agent may resign as such at any time upon at least 30 days’ prior notice to the Borrower and all Lenders and shall resign where required to do in accordance with Section 4.14, provided that any such resignation shall not become effective until a successor Facility Agent has been appointed as provided in this Section 10.5 and such successor Facility Agent has accepted such appointment. If the Facility Agent at any time shall resign, the Required Lenders shall, subject to the immediately preceding proviso and subject to the consent of the Borrower (such consent not to be unreasonably withheld), appoint another Lender as a successor to the Facility Agent which shall thereupon become such Facility Agent’s successor hereunder (provided that the Required Lenders shall, subject to the consent of the Borrower unless an Event of Default or a Prepayment Event shall have occurred and be continuing (such consent not to be

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unreasonably withheld or delayed) offer to each of the other Lenders in turn, in the order of their respective Percentages of the Loan, the right to become successor Facility Agent). If no successor Facility Agent shall have been so appointed by the Required Lenders, and shall have accepted such appointment, within 30 days after the Facility Agent’s giving notice of resignation, then the Facility Agent may, on behalf of the Lenders, appoint a successor Facility Agent, which shall be one of the Lenders or a commercial banking institution having a combined capital and surplus of at least $1,000,000,000 (or the equivalent in other currencies), subject, in each case, to the consent of the Borrower (such consent not to be unreasonably withheld). Upon the acceptance of any appointment as Facility Agent hereunder by a successor Facility Agent, such successor Facility Agent shall be entitled to receive from the resigning Facility Agent such documents of transfer and assignment as such successor Facility Agent may reasonably request, and shall thereupon succeed to and become vested with all rights, powers, privileges and duties of the resigning Facility Agent, and the resigning Facility Agent shall be discharged from its duties and obligations under this Agreement. After any resigning Facility Agent’s resignation hereunder as the Facility Agent, the provisions of:

a)    this Article X shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Facility Agent under this Agreement; and

b)    Section 11.3 and Section 11.4 shall continue to inure to its benefit.

If a Lender acting as the Facility Agent assigns its Loan to one of its Affiliates, such Facility Agent may, subject to the consent of the Borrower (such consent not to be unreasonably withheld or delayed) assign its rights and obligations as Facility Agent to such Affiliate.

SECTION 10.6.    LOANS BY THE FACILITY AGENT. The Facility Agent shall have the same rights and powers with respect to the Loan made by it or any of its Affiliates. The Facility Agent and its Affiliates may accept deposits from, lend money to, and generally engage in any kind of business with the Borrower or any Affiliate of the Borrower as if the Facility Agent were not the Facility Agent hereunder and without any duty to account therefor to the Lenders. The Facility Agent shall have no duty to disclose information obtained or received by it or any of its Affiliates relating to the Borrower or its Subsidiaries to the extent such information was obtained or received in any capacity other than as the Facility Agent.

SECTION 10.7.    CREDIT DECISIONS. Each Lender acknowledges that it has, independently of each Agent and each other Lender, and based on such Lender’s review of the financial information of the Obligors, this Agreement, the other Loan Documents (the terms and provisions of which being satisfactory to such Lender) and such other documents, information and investigations as such Lender has deemed appropriate, made its own credit decision to extend its Commitment. Each Lender also acknowledges that it will, independently of each Agent and each other Lender, and based on such other documents, information and investigations as it shall deem appropriate at any time, continue to make its own credit decisions as to exercising or not exercising from time to time any rights and privileges available to it under this Agreement or any other Loan Document.

SECTION 10.8.    COPIES, ETC. Each Agent shall give prompt notice to each Lender of each notice or request required or permitted to be given to such Agent by the Borrower pursuant to the terms of this Agreement (unless concurrently delivered to the Lenders by the Borrower). Each Agent will distribute to each Lender each document or instrument received for its account and copies of all other communications received by such Agent from the Borrower for distribution to the Lenders by such Agent in accordance with the terms of this Agreement.

SECTION 10.9.    THE AGENTS’ RIGHTS. Each Agent may (i) assume that all representations or warranties made or deemed repeated by the Obligors in or pursuant to this Agreement or any Loan Document are true and complete, unless, in its capacity as the

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Facility Agent, it has acquired actual knowledge to the contrary, (ii) assume that no Default has occurred unless, in its capacity as an Agent, it has acquired actual knowledge to the contrary, (iii) rely on any document or notice believed by it to be genuine, (iv) rely as to legal or other professional matters on opinions and statements of any legal or other professional advisers selected or approved by it, (v) rely as to any factual matters which might reasonably be expected to be within the knowledge of the Borrower on a certificate signed by or on behalf of the Borrower and (vi) refrain from exercising any right, power, discretion or remedy unless and until instructed to exercise that right, power, discretion or remedy and as to the manner of its exercise by the Lenders (or, where applicable, by the Required Lenders) and unless and until such Agent has received from the Lenders any payment which such Agent may require on account of, or any security which such Agent may require for, any costs, claims, expenses (including legal and other professional fees) and liabilities which it considers it may incur or sustain in complying with those instructions.

SECTION 10.10.    THE FACILITY AGENT’S DUTIES. The Facility Agent shall (i) if requested in writing to do so by a Lender, make enquiry and advise the Lenders as to the performance or observance of any of the provisions of this Agreement or any Loan Document by the Borrower or as to the existence of an Event of Default and (ii) inform the Lenders promptly of any Event of Default of which the Facility Agent has actual knowledge.

The Facility Agent shall not be deemed to have actual knowledge of the falsehood or incompleteness of any representation or warranty made or deemed repeated by the Obligors or actual knowledge of the occurrence of any Default unless a Lender or the Borrower shall have given written notice thereof to the Facility Agent in its capacity as the Facility Agent. Any information acquired by the Facility Agent other than specifically in its capacity as the Facility Agent shall not be deemed to be information acquired by the Facility Agent in its capacity as the Facility Agent.

The Facility Agent may, without any liability to account to the Lenders, generally engage in any kind of banking or trust business with the Borrower or with the Borrower’s Subsidiaries or associated companies or with a Lender as if it were not the Facility Agent.

SECTION 10.11.    EMPLOYMENT OF AGENTS. In performing its duties and exercising its rights, powers, discretions and remedies under or pursuant to this Agreement or the Loan Documents, each Agent shall be entitled to employ and pay agents to do anything which such Agent is empowered to do under or pursuant to this Agreement or the Loan Documents (including the receipt of money and documents and the payment of money); provided that, unless otherwise provided herein, including without limitation Section 11.3, the employment of such agents shall be for such Agent’s account, and to act or refrain from taking action in reliance on the opinion of, or advice or information obtained from, any lawyer, banker, broker, accountant, valuer or any other person believed by such Agent in good faith to be competent to give such opinion, advice or information.

SECTION 10.12.    DISTRIBUTION OF PAYMENTS. The Facility Agent shall pay promptly to the order of each Lender that Lender’s Percentage share of every sum of money received by the Facility Agent pursuant to this Agreement or the Loan Documents (including, without limitation, any amounts payable pursuant to Section 4.4.1 but not including any amounts payable pursuant to the Fee Letter and any amounts which, by the terms of this Agreement or the Loan Documents, are paid to the Facility Agent for the account of the Facility Agent alone or specifically for the account of one or more Lenders) and until so paid such amount shall be held by the Facility Agent on trust absolutely for that Lender.

SECTION 10.13.    REIMBURSEMENT. The Facility Agent shall have no liability to pay any sum to a Lender until it has itself received payment of that sum. If, however, the Facility Agent does pay any sum to a Lender on account of any amount prospectively due to that Lender pursuant to Section 10.12 before it has itself received payment of that amount, and the Facility Agent does not in fact receive payment within two (2) Business Days after the date on which that payment was required to be made by the terms of this Agreement or

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the Loan Documents, that Lender will, on demand by the Facility Agent, refund to the Facility Agent an amount equal to the amount received by it, together with an amount sufficient to reimburse the Facility Agent for any amount which the Facility Agent may certify that it has been required to pay by way of interest on money borrowed to fund the amount in question during the period beginning on the date on which that amount was required to be paid by the terms of this Agreement or the Loan Documents and ending on the date on which the Facility Agent receives reimbursement.

SECTION 10.14.    INSTRUCTIONS. Where an Agent is authorized or directed to act or refrain from acting in accordance with the instructions of the Lenders or of the Required Lenders each of the Lenders shall provide such Agent with instructions within three (3) Business Days of such Agent’s request (which request may be made orally or in writing). If a Lender does not provide such Agent with instructions within that period, that Lender shall be bound by the decision of such Agent. Nothing in this Section 10.14 shall limit the right of such Agent to take, or refrain from taking, any action without obtaining the instructions of the Lenders or the Required Lenders if such Agent in its discretion considers it necessary or appropriate to take, or refrain from taking, such action in order to preserve the rights of the Lenders under or in connection with this Agreement or the Loan Documents. In that event, such Agent will notify the Lenders of the action taken by it as soon as reasonably practicable, and the Lenders agree to ratify any action taken by the Facility Agent pursuant to this Section 10.14.

SECTION 10.15.    PAYMENTS. All amounts payable to a Lender under this Section 10 shall be paid to such account at such bank as that Lender may from time to time direct in writing to the Facility Agent.

SECTION 10.16.    “KNOW YOUR CUSTOMER” CHECKS. Each Lender shall promptly upon the request of the Facility Agent supply, or procure the supply of, such documentation and other evidence as is reasonably requested by the Facility Agent (for itself) in order for the Facility Agent to carry out and be satisfied it has complied with all necessary “know your customer” or other similar checks under all applicable laws and regulations pursuant to the transactions contemplated in this Agreement or the Loan Documents.

SECTION 10.17.    NO FIDUCIARY RELATIONSHIP. Except as provided in Section 10.12, no Agent shall have any fiduciary relationship with or be deemed to be a trustee of or for any other person and nothing contained in this Agreement or any Loan Document shall constitute a partnership between any two or more Lenders or between either Agent and any other person.

SECTION 10.18.    ILLEGALITY. The Agent shall refrain from doing anything which it reasonably believes would be contrary to any law of any jurisdiction (including but not limited to England and Wales, the United States of America or any jurisdiction forming part of it) or any regulation or directive of any agency of such state or jurisdiction or which would or might render it liable to any person and may without liability do anything which is, in its opinion, necessary to comply with any such law, directive or regulation.

ARTICLE XI

MISCELLANEOUS PROVISIONS

SECTION 11.1.    WAIVERS, AMENDMENTS, ETC. The provisions of this Agreement and of each other Loan Document may from time to time be amended, modified or waived, if such amendment, modification or waiver is in writing and consented to by the Borrower and the Required Lenders; provided that no such amendment, modification or waiver which would:

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a)    contravene or be in breach of the terms of the BpiFAE Insurance Policy or the arrangements with Natixis DAI relating to the CIRR (if the Fixed Rate applies) shall be effective unless consented to by, as applicable, BpiFAE and/or Natixis DAI;

b)    modify any requirement hereunder that any particular action be taken by all the Lenders or by the Required Lenders shall be effective unless consented to by each Lender;

c)    modify this Section 11.1 or change the definition of “Required Lenders” shall be made without the consent of each Lender;

d)    increase the Commitment of any Lender shall be made without the consent of such Lender;

e)    reduce any fees described in Article III payable to any Lender shall be made without the consent of such Lender;

f)    extend the Commitment Termination Date of any Lender shall be made without the consent of such Lender;

g)    extend the due date for, or reduce the amount of, any scheduled repayment or prepayment of principal of or interest on the Loan (or reduce the principal amount of or rate of interest on the Loan) owed to any Lender shall be made without the consent of such Lender; or

h)    affect adversely the interests, rights or obligations of the Facility Agent in its capacity as such shall be made without consent of the Facility Agent.

No failure or delay on the part of the Facility Agent or any Lender in exercising any power or right under this Agreement or any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such power or right preclude any other or further exercise thereof or the exercise of any other power or right. No notice to or demand on the Borrower in any case shall entitle it to any notice or demand in similar or other circumstances. No waiver or approval by any the Facility Agent or any Lender under this Agreement or any other Loan Document shall, except as may be otherwise stated in such waiver or approval, be applicable to subsequent transactions. No waiver or approval hereunder shall require any similar or dissimilar waiver or approval thereafter to be granted hereunder. The Lenders hereby agree, at any time and from time to time that the Nordea Agreement or the Bank of Nova Scotia Agreement is amended or refinanced, to negotiate in good faith to amend this Agreement to conform any representations, warranties, covenants or events of default in this Agreement to the amendments made to any substantively comparable provisions in the Nordea Agreement or the Bank of Nova Scotia Agreement or any refinancing thereof.

Neither the Borrower’s rights nor its obligations under the Loan Documents shall be changed, directly or indirectly, as a result of any amendment, supplement, modification, variance or novation of the BpiFAE Insurance Policy, except any amendments, supplements, modifications, variances or novations, as the case may be, which occur (i) with the Borrower’s consent, (ii) at the Borrower’s request or (iii) in order to conform to amendments, supplements, modifications, variances or novations effected in respect of the Loan Documents in accordance with their terms.

SECTION 11.2.    NOTICES.

a)    All notices and other communications provided to any party hereto under this Agreement or any other Loan Document shall be in writing, by facsimile or by electronic mail and addressed, delivered or transmitted to such party at its address, facsimile number or electronic mail address set forth below its signature hereto or set forth in the

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Lender Assignment Agreement or at such other address, or facsimile number as may be designated by such party in a notice to the other parties. Any notice, if mailed and properly addressed with postage prepaid or if properly addressed and sent by pre-paid courier service, shall be deemed given when received; any notice, if transmitted by facsimile, shall be deemed given when transmitted provided it is received in legible form; any notice, if transmitted by electronic mail, shall be deemed given upon acknowledgment of receipt by the recipient.

b)    So long as Citibank Europe plc, UK Branch is the Facility Agent, the Borrower may provide to the Facility Agent all information, documents and other materials that it furnishes to the Facility Agent hereunder or any other Loan Document (and any guaranties, security agreements and other agreements relating thereto), including, without limitation, all notices, requests, financial statements, financial and other reports, certificates and other materials, but excluding any such communication that (i) relates to a request for a new, or a conversion of an existing advance or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due hereunder or any other Loan Document prior to the scheduled date therefor, (iii) provides notice of any Default or Event of Default or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of the Agreement and/or any advance or other extension of credit hereunder (all such non-excluded communications being referred to herein collectively as “Communications”), by transmitting the Communications in an electronic/soft medium in a format acceptable to the Facility Agent to such email address notified by the Facility Agent to the Borrower; provided that any Communication requested pursuant to Section 7.1.1(h) shall be in a format acceptable to the Borrower and the Facility Agent.

c)    The Borrower agrees that the Facility Agent may make such items included in the Communications as the Borrower may specifically agree available to the Lenders by posting such notices, at the option of the Borrower, on Intralinks or any similar such platform (the “Platform”) acceptable to the Borrower. Although the primary web portal is secured with a dual firewall and a User ID/Password Authorization System and the Platform is secured through a single user per deal authorization method whereby each user may access the Platform only on a deal-by-deal basis, the Borrower acknowledges that (i) the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution, (ii) the Platform is provided “as is” and “as available” and (iii) neither the Facility Agent nor any of its Affiliates warrants the accuracy, adequacy or completeness of the Communications or the Platform and each expressly disclaims liability for errors or omissions in the Communications or the Platform. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Facility Agent or any of its Affiliates in connection with the Platform.

d)    The Facility Agent agrees that the receipt of Communications by the Facility Agent at its e-mail address set forth above shall constitute effective delivery of such Communications to the Facility Agent for purposes hereunder and any other Loan Document (and any guaranties, security agreements and other agreements relating thereto).

SECTION 11.3.    PAYMENT OF COSTS AND EXPENSES. The Borrower agrees to pay on demand all reasonable expenses of the Facility Agent (including the reasonable fees and out-of-pocket expenses of counsel to the Facility Agent and of local counsel, if any, who may be retained by counsel to the Facility Agent) in connection with any amendments, waivers, consents, supplements or other modifications to, this Agreement or any other Loan Document as may from time to time hereafter be required, whether or not the transactions contemplated hereby are consummated. The Borrower further agrees to pay, and to save the Facility Agent and the Lenders harmless from all liability for, any stamp, recording, documentary or other similar taxes arising from the execution, delivery or enforcement of this Agreement or the borrowing hereunder or any other Loan Documents. The Borrower also agrees to reimburse the Facility Agent and each Lender upon demand for all reasonable out-

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of-pocket expenses (including reasonable attorneys’ fees and legal expenses) incurred by the Facility Agent or such Lender in connection with (x) the negotiation of any restructuring or “work-out”, whether or not consummated, of any Obligations and (y) the enforcement of any Obligations.

SECTION 11.4.    INDEMNIFICATION. In consideration of the execution and delivery of this Agreement by each Lender and the extension of the Commitments, the Borrower hereby indemnifies and holds harmless the Facility Agent, each Lender and each of their respective Affiliates and their respective officers, advisors, directors and employees (collectively, the “Indemnified Parties”) from and against any and all claims, damages, losses, liabilities and expenses (including, without limitation, reasonable fees and disbursements of counsel), joint or several, that may be incurred by or asserted or awarded against any Indemnified Party (including, without limitation, in connection with any investigation, litigation or proceeding or the preparation of a defense in connection therewith), in each case arising out of or in connection with or by reason of this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby or any actual or proposed use of the proceeds of the Loans (collectively, the “Indemnified Liabilities”), except to the extent such claim, damage, loss, liability or expense is found in a final, non- appealable judgment by a court of competent jurisdiction to have resulted primarily from such Indemnified Party’s gross negligence or willful misconduct or the material breach by such Indemnified Party of its obligations under this Agreement, any other Loan Document, the BpiFAE Insurance Policy or Interest Stabilisation Agreement and which breach is not attributable to the Borrower’s own breach of the terms of this Agreement or any other Loan Document or is a claim, damage, loss, liability or expense which would have been compensated under other provisions of the Loan Documents but for any exclusions applicable thereunder.

In the case of an investigation, litigation or other proceeding to which the indemnity in this paragraph applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by the Borrower, any of its directors, security holders or creditors, an Indemnified Party or any other person or an Indemnified Party is otherwise a party thereto. Each Indemnified Party shall (a) furnish the Borrower with prompt notice of any action, suit or other claim covered by this Section 11.4, (b) not agree to any settlement or compromise of any such action, suit or claim without the Borrower’s prior consent, (c) shall cooperate fully in the Borrower’s defense of any such action, suit or other claim (provided that the Borrower shall reimburse such indemnified party for its reasonable out-of-pocket expenses incurred pursuant hereto) and (d) at the Borrower’s request, permit the Borrower to assume control of the defense of any such claim, other than regulatory, supervisory or similar investigations, provided that (i) the Borrower acknowledges in writing its obligations to indemnify the Indemnified Party in accordance with the terms herein in connection with such claims, (ii) the Borrower shall keep the Indemnified Party fully informed with respect to the conduct of the defense of such claim, (iii) the Borrower shall consult in good faith with the Indemnified Party (from time to time and before taking any material decision) about the conduct of the defense of such claim, (iv) the Borrower shall conduct the defense of such claim properly and diligently taking into account its own interests and those of the Indemnified Party, (v) the Borrower shall employ counsel reasonably acceptable to the Indemnified Party and at the Borrower’s expense, and (vi) the Borrower shall not enter into a settlement with respect to such claim unless either (A) such settlement involves only the payment of a monetary sum, does not include any performance by or an admission of liability or responsibility on the part of the Indemnified Party, and contains a provision unconditionally releasing the Indemnified Party and each other indemnified party from, and holding all such persons harmless, against, all liability in respect of claims by any releasing party or (B) the Indemnified Party provides written consent to such settlement (such consent not to be unreasonably withheld or delayed). Notwithstanding the Borrower’s election to assume the defense of such action, the Indemnified Party shall have the right to employ separate counsel and to participate in the defense of such action and the Borrower shall bear the fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the Borrower to represent the Indemnified Party would present such counsel with an actual or

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potential conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the Borrower and the Indemnified Party and the Indemnified Party shall have concluded that there may be legal defenses available to it which are different from or additional to those available to the Borrower and determined that it is necessary to employ separate counsel in order to pursue such defenses (in which case the Borrower shall not have the right to assume the defense of such action on the Indemnified Party’s behalf), (iii) the Borrower shall not have employed counsel reasonably acceptable to the Indemnified Party to represent the Indemnified Party within a reasonable time after notice of the institution of such action, or (iv) the Borrower authorizes the Indemnified Party to employ separate counsel at the Borrower’s expense. The Borrower acknowledges that none of the Indemnified Parties shall have any liability (whether direct or indirect, in contract, tort or otherwise) to the Borrower or any of its security holders or creditors for or in connection with the transactions contemplated hereby, except to the extent such liability is determined in a final non- appealable judgment by a court of competent jurisdiction to have resulted primarily from such Indemnified Party’s gross negligence or willful misconduct. In no event, however, shall any Indemnified Party be liable on any theory of liability for any special, indirect, consequential or punitive damages (including, without limitation, any loss of profits, business or anticipated savings). If and to the extent that the foregoing undertaking may be unenforceable for any reason, the Borrower hereby agrees to make the maximum contribution to the payment and satisfaction of each of the Indemnified Liabilities which is permissible under applicable law.

SECTION 11.5.    SURVIVAL. The obligations of the Borrower under Sections 4.3, 4.4, 4.5, 4.6, 4.7, 11.3 and 11.4 and the obligations of the Lenders under Section 10.1, shall in each case survive any termination of this Agreement and the payment in full of all Obligations. The representations and warranties made by the Borrower in this Agreement and in each other Loan Document shall survive the execution and delivery of this Agreement and each such other Loan Document.

SECTION 11.6.    SEVERABILITY. Any provision of this Agreement or any other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such provision and such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Agreement or such Loan Document or affecting the validity or enforceability of such provision in any other jurisdiction.

SECTION 11.7.    HEADINGS. The various headings of this Agreement and of each other Loan Document are inserted for convenience only and shall not affect the meaning or interpretation of this Agreement or such other Loan Document or any provisions hereof or thereof.

SECTION 11.8.    EXECUTION IN COUNTERPARTS, EFFECTIVENESS, ETC. This Agreement may be executed by the parties hereto in several counterparts, each of which shall be deemed to be an original and all of which shall constitute together but one and the same agreement. This Agreement, as a novated and amended Agreement, shall become effective upon the occurrence of the Novation Effective Time under, and as defined in, the Novation Agreement.

SECTION 11.9.    THIRD PARTY RIGHTS. Notwithstanding the provisions of the Contracts (Rights of Third Parties) Act 1999, no term of this Agreement is enforceable by a person who is not a party to it with the exception of BpiFAE and Natixis.

SECTION 11.10.    SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns; provided that:

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a)    except to the extent permitted under Section 7.2.6, the Borrower may not assign or transfer its rights or obligations hereunder without the prior written consent of the Facility Agent, each Lender and BpiFAE; and

b)    the rights of sale, assignment and transfer of the Lenders are subject to Section 11.11.

SECTION 11.11.    SALE AND TRANSFER OF THE LOAN; PARTICIPATIONS IN THE LOAN. Each Lender may assign its Percentage or portion of the Loan to one or more other Persons (a “New Lender”), or sell participations in its Percentage or portion of the Loan to one or more other Persons; provided that, in the case of assignments where the Fixed Rate applies, such New Lender (other than BpiFAE or CAFFIL as assignee of all or any of SFIL’s rights as Lender following the enforcement of the security granted pursuant to paragraph (iv) of Section 11.11.1 in connection with the BpiFAE Enhanced Guarantee, and subject as provided in Section 11.11.1(iv)) enters into an Interest Stabilisation Agreement.

SECTION 11.11.1    Assignments

i.    Any Lender with the prior written consents of the Borrower and the Facility Agent (which consents shall not be unreasonably delayed or withheld and which consent, in the case of the Borrower, shall be deemed to have been given in the absence of a written notice delivered by the Borrower to the Facility Agent, on or before the fifth Business Day after receipt by the Borrower of such Lender’s request for consent, stating, in reasonable detail, the reasons why the Borrower proposes to withhold such consent) may at any time (and from time to time) assign or transfer to one or more commercial banks or other financial institutions all or any fraction of such Lender’s portion of the Loan.

ii.    Any Lender, with notice to the Borrower and the Facility Agent, and, notwithstanding the foregoing clause (i), without the consent of the Borrower, or the Facility Agent may assign or transfer (A) to any of its Affiliates, (B) to SFIL or (C) following the occurrence and during the continuance of an Event of Default under Sections 8.1.1, 8.1.4(a) or 8.1.5, to any other Person, in each case, all or any fraction of such Lender’s portion of the Loan.

iii.    Any Lender may (notwithstanding the foregoing clauses, and without notice to, or consent from, the Borrower or the Facility Agent) assign or charge all or any fraction of its portion of the Loan to any federal reserve or central bank as collateral security in connection with the extension of credit or support by such federal reserve or central bank to such Lender.

iv.    SFIL may (notwithstanding the foregoing clauses, and without notice to, or consent from, the Borrower or the Facility Agent) assign, charge or otherwise grant security over all or any fraction of its portion of the Loan and of its rights as Lender to CAFFIL as collateral security in connection with the extension of credit or support by CAFFIL to SFIL in respect of this Agreement and the BpiFAE Enhanced Guarantee, provided that at the time of the assignment, charge or grant of security CAFFIL is an Affiliate of SFIL and that such assignment, charge or other security is on terms that (i) CAFFIL shall not have any rights to assign, charge or grant any security over such rights to any other person (other than to BpiFAE pursuant to and in accordance with the BpiFAE Enhanced Guarantee) without the prior written consent of the Borrower, (ii) CAFFIL shall only be entitled to enforce its rights under such assignment, charge or other security without the prior written consent of the Borrower if at that time it remains an Affiliate of SFIL, (iii) prior to any enforcement such assignment, charge or other security, the Borrower and the Facility Agent shall continue to deal solely and directly with SFIL in connection with its rights and obligations as Lender under this Agreement and other Loan Documents (subject to any payment instructions given by SFIL), (iv) for the avoidance of doubt,

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the Borrower’s rights and obligations under this Agreement shall not be increased or affected (including, without limitation, the right to pay Fixed Rate under Section 3.3.1) as a result of such assignment, charge or security or any enforcement thereof, (v) the Borrower shall not be liable to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay to SFIL had no such assignment, charge or other security been granted and (vi) without prejudice to SFIL’s obligations under that Section, CAFFIL shall be bound by the confidentiality provisions set forth in Section 11.15. in relation to any information to which it applies to the same extent as required of the Lenders. For the avoidance of doubt: (A) if CAFFIL becomes a Lender under this Agreement in respect of any portion of the Loan following enforcement of any assignment, charge or other security granted to it by SFIL pursuant to this Section 11.11.1(iv), it shall have the same rights to assign or transfer all or any fraction of such portion of the Loan on and subject to the same terms and conditions as are set forth in this Agreement for assignments and transfers by other Lenders and (B) CAFFIL may not enforce its rights under any such assignment, charge or other security by assigning or transferring all or any fraction of SFIL’s portion of the Loan or any of its rights or obligations under this Agreement or other Loan Documents except pursuant to an assignment or transfer to a commercial bank or other financial institution on and subject to the same terms and conditions as are set forth in this Agreement for assignments and transfers by Lenders.

v.    No Lender may (notwithstanding the foregoing clauses) assign or transfer any of its rights under this Agreement unless it has given prior written notification of the transfer to BpiFAE and (if the Loan is accruing interest at the Fixed Rate) Natixis DAI and has obtained a prior written consent from BpiFAE and Natixis DAI and any Assignee Lender (other than BpiFAE and CAFFIL as assignee of all or any of SFIL’s rights as Lender following the enforcement of the security granted pursuant to paragraph (iv) of Section 11.11.1 in connection with the BpiFAE Enhanced Guarantee, subject as provided in Section 11.11.1(iv)) is, if the Fixed Rate applies, eligible to benefit from the CIRR stabilisation. Any assignment or transfer shall comply with the terms of the BpiFAE Insurance Policy.

vi.    Nothing in this Section 11.11.1 shall prejudice the right of the Lender to assign its rights under this Agreement to BpiFAE, if such assignment is required to be made by that Lender to BpiFAE in accordance with the BpiFAE Insurance Policy or the BpiFAE Enhanced Guarantee or, if the Lender is SFIL, to CAFFIL (but only if CAFFIL is, at that time, an Affiliate of SFIL) upon the enforcement of any security granted pursuant, and subject to the provisions of paragraph (iv) of Section 11.11.1, in connection with the BpiFAE Enhanced Guarantee.

Each Person described in the foregoing clauses as being the Person to whom such assignment or transfer is to be made, is hereinafter referred to as an “Assignee Lender”. Assignments in a minimum aggregate amount of $25,000,000 (or, if less, all of such Lender’s portion of the Loan and Commitment) (which assignment or transfer shall be of a constant, and not a varying, percentage of such Lender’s portion of the Loan) are permitted; provided that the Borrower and the Facility Agent shall be entitled to continue to deal solely and directly with such Lender in connection with the interests so assigned or transferred to an Assignee Lender until:

a)    written notice of such assignment or transfer, together with payment instructions, addresses and related information with respect to such Assignee Lender, shall have been given to the Borrower and the Facility Agent by such Lender and such Assignee Lender;

b)    such Assignee Lender shall have executed and delivered to the Borrower and the Facility Agent a Lender Assignment Agreement, accepted by the Facility

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Agent and any other agreements required by the Facility Agent or, if the Fixed Rate applies, Natixis in connection therewith; and

c)    the processing fees described below shall have been paid.

From and after the date that the Facility Agent accepts such Lender Assignment Agreement, (x) the Assignee Lender thereunder shall be deemed automatically to have become a party hereto and to the extent that rights and obligations hereunder have been assigned or transferred to such Assignee Lender in connection with such Lender Assignment Agreement, shall have the rights and obligations of a Lender hereunder and under the other Loan Documents, and (y) the assignor Lender, to the extent that rights and obligations hereunder have been assigned or transferred by it, shall be released from its obligations hereunder and under the other Loan Documents, other than any obligations arising prior to the effective date of such assignment. Except to the extent resulting from a subsequent change in law, in no event shall the Borrower be required to pay to any Assignee Lender any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no such assignment been made. Such assignor Lender or such Assignee Lender must also pay a processing fee to the Facility Agent upon delivery of any Lender Assignment Agreement in the amount of $5,000 (and shall also reimburse the Facility Agent and Natixis for any reasonable out-of-pocket costs, including reasonable attorneys’ fees and expenses, incurred in connection with the assignment).

SECTION 11.11.2    Participations. Any Lender may at any time sell to one or more commercial banks or other financial institutions (each of such commercial banks and other financial institutions being herein called a “Participant”) participating interests in its Loan; provided that:

1.    no participation contemplated in this Section 11.11.2 shall relieve such Lender from its obligations hereunder;

2.    such Lender shall remain solely responsible for the performance of its obligations hereunder;

3.    the Borrower and the Facility Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and each of the other Loan Documents;

4.    no Participant, unless such Participant is an Affiliate of such Lender, shall be entitled to require such Lender to take or refrain from taking any action hereunder or under any other Loan Document, except that such Lender may agree with any Participant that such Lender will not, without such Participant’s consent, take any actions of the type described in clauses (b) through (f) of Section11.1;

5.    the Borrower shall not be required to pay any amount under Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and 4.7 that is greater than the amount which it would have been required to pay had no participating interest been sold; and

6.    each Lender that sells a participation under this Section 11.11.2 shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each of the Participant’s interest in that Lender’s portion of the Loan, Commitments or other interests hereunder (the “Participant Register”). The entries in the Participant Register shall be conclusive absent manifest error, and such Lender may treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes hereunder.

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The Borrower acknowledges and agrees that each Participant, for purposes of Sections 4.2(c), 4.3, 4.4, 4.5, 4.6 and clause (e) of 7.1.1, shall be considered a Lender.

SECTION 11.11.3    Register. The Facility Agent shall maintain at its address referred to in Section 11.2 a copy of each Lender Assignment Agreement delivered to and accepted by it and a register for the recordation of the names and addresses of the Lenders and the Commitment(s) of, and principal amount of the Loan owing to, each Lender from time to time (the “Register”). The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Borrower, the Facility Agent and the Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice.

SECTION 11.11.4    Rights of BpiFAE to payments. The Borrower acknowledges that, immediately upon any payment by BpiFAE (i) of any amounts to a Lender under the BpiFAE Insurance Policy, BpiFAE will be automatically subrogated to the extent of such payment to the rights of that Lender under the Loan Documents or (ii) of any amount under the BpiFAE Enhanced Guarantee and the enforcement of any related security granted by SFIL to any of its Affiliates, which may benefit BpiFAE after payment by BpiFAE under the BpiFAE Enhanced Guarantee, BpiFAE will be automatically entitled to receive the payments normally due to SFIL under the Loan Documents( but, for the avoidance of doubt, such payments shall continue to be made by the Borrower to the Facility Agent in accordance with the provisions of Section 4.8 or any other relevant provisions of this Agreement, as applicable).

SECTION 11.12.    OTHER TRANSACTIONS. Nothing contained herein shall preclude the Facility Agent or any Lender from engaging in any transaction, in addition to those contemplated by this Agreement or any other Loan Document, with the Borrower or any of its Affiliates in which the Borrower or such Affiliate is not restricted hereby from engaging with any other Person.

SECTION 11.13.    BPIFAE INSURANCE POLICY.

SECTION 11.13.1    Terms of BpiFAE Insurance Policy

a)    The BpiFAE Insurance Policy will cover 100% of the Loan.

b)    The BpiFAE Premium will equal 3% of the aggregate principal amount of the Loan as at the Actual Delivery Date.

c)    If, after the Actual Delivery Date, the Borrower prepays all or part of the Loan in accordance with this Agreement, BpiFAE shall reimburse to the ECA Agent for the account of the Borrower an amount equal to 80% of all or a corresponding proportion of the unexpired portion of the BpiFAE Premium, having regard to the amount of the prepayment and the remaining term of the Loan, such amount to be calculated in accordance with the following formula:

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R = P x (1 – (1 / (1+3%)) x (N / (12 * 365)) x 80%

where:

“R” means the amount of the refund;

“P” means the amount of the prepayment;

“N” means the number of days between the effective prepayment date and Final Maturity; and

P x (1 – (1 / (1+3%)) corresponds to the share of the financed BpiFAE Premium corresponding to P.

SECTION 11.13.2    Obligations of the Borrower. Provided that the BpiFAE Insurance Policy complies with Section 11.13.1 and remains in full force and effect, the Borrower shall pay the balance of the BpiFAE Premium calculated in accordance with Section 11.13.1(b) and still owing to BpiFAE on the Actual Delivery Date to BpiFAE on the Actual Delivery Date by directing the Agent in the Loan Request to pay the Additional Advance in respect of the BpiFAE Premium directly to BpiFAE.

SECTION 11.13.3    Obligations of the ECA Agent and the Lenders.

a)    Promptly upon receipt of the BpiFAE Insurance Policy from BpiFAE, the ECA Agent shall (subject to any confidentiality undertakings given to BpiFAE by the ECA Agent pursuant to the terms of the BpiFAE Insurance Policy) send a copy thereof to the Borrower.

b)    The ECA Agent shall perform such acts or provide such information, which are, acting reasonably, within its power so to perform or so to provide, as required by BpiFAE under the BpiFAE Insurance Policy as necessary to ensure that the Lenders obtain the support of BpiFAE pursuant to the BpiFAE Insurance Policy.

c)    Each Lender will co-operate with the ECA Agent, the Facility Agent and each other Lender, and take such action and/or refrain from taking such action as may be reasonably necessary, to ensure that the BpiFAE Insurance Policy and each Interest Stabilisation Agreement continues in full force and effect and shall indemnify and hold harmless each other Lender in the event that the BpiFAE Insurance Policy or such Interest Stabilisation Agreement (as the case may be) does not continue in full force and effect due to its gross negligence or willful default or due to a voluntary change in status which results in it no longer being eligible for CIRR interest stabilisation.

d)    The ECA Agent shall, in conjunction with the Facility Agent:

i.    make written requests to BpiFAE seeking a reimbursement of the BpiFAE Premium in the circumstances described in Section 11.13.1(c) promptly after the relevant cancellation or prepayment and (subject to any confidentiality undertakings given to BpiFAE by the ECA Agent pursuant to the terms of the BpiFAE Insurance Policy) provide a copy of the request to the Borrower;

ii.    use its reasonable endeavours to seek any reimbursement of the BpiFAE Premium to which the ECA Agent is entitled;

iii.    pay to the Borrower (in the same currency as the refund received from BpiFAE) the full amount of any reimbursement of the BpiFAE Premium that the ECA Agent receives from BpiFAE within two (2) Business Days of receipt with same day value; and

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iv.    relay the good faith concerns of the Borrower to BpiFAE regarding the amount of any reimbursement to which the ECA Agent is entitled, it being agreed that the ECA Agent’s obligation shall be no greater than simply to pass on to BpiFAE the Borrower’s concerns.

SECTION 11.14.    LAW AND JURISDICTION

SECTION 11.14.1    Governing Law. This Agreement and any non- contractual obligations arising out of or in respect of this Agreement shall in all respects be governed by and interpreted in accordance with English Law.

SECTION 11.14.2    Jurisdiction. For the exclusive benefit of the Facility Agent and the Lenders, the parties to this Agreement irrevocably agree that the courts of England are to have jurisdiction to settle any disputes which may arise out of or in connection with this Agreement and that any proceedings may be brought in those courts. The Borrower irrevocably waives any objection which it may now or in the future have to the laying of the venue of any proceedings in any court referred to in this Section, and any claim that those proceedings have been brought in an inconvenient or inappropriate forum.

SECTION 11.14.3    Alternative Jurisdiction. Nothing contained in this Section shall limit the right of the Facility Agent or the Lenders to commence any proceedings against the Borrower in any other court of competent jurisdiction nor shall the commencement of any proceedings against the Borrower in one or more jurisdictions preclude the commencement of any proceedings in any other jurisdiction, whether concurrently or not.

SECTION 11.14.4    Service of Process. Without prejudice to the right of the Facility Agent or the Lenders to use any other method of service permitted by law, the Borrower irrevocably agrees that any writ, notice, judgment or other legal process shall be sufficiently served on it if addressed to it and left at or sent by post to RCL Cruises Ltd., presently at Building 3, The Heights – Brooklands, Weybridge, Surrey, KT13 ONY, Attention: General Counsel, and in that event shall be conclusively deemed to have been served at the time of leaving or, if posted, at 9:00 am on the third Business Day after posting by prepaid first class registered post.

SECTION 11.15.    CONFIDENTIALITY. Each of the Facility Agent and the Lenders agrees to maintain and to cause its Affiliates to maintain the confidentiality of all information provided to it by the Borrower or any Subsidiary of the Borrower, or by the Facility Agent on the Borrower’s or such Subsidiary’s behalf, under this Agreement, and neither it nor any of its Affiliates shall use any such information other than in connection with or in enforcement of this Agreement or in connection with other business now or hereafter existing or contemplated with the Borrower or any Subsidiary, except to the extent such information (i) was or becomes generally available to the public other than as a result of disclosure by it or its Affiliates or their respective directors, officers, employees and agents, or (ii) was or becomes available on a non-confidential basis from a source other than the Borrower or any of its Subsidiaries so long as such source is not, to its knowledge, prohibited from disclosing such information by a legal, contractual or fiduciary obligation to the Borrower or any of its Affiliates; provided, however, that it may disclose such information (A) at the request or pursuant to any requirement of any self-regulatory body, governmental body, agency or official to which the Facility Agent, any Lender or any of their respective Affiliates is subject or in connection with an examination of the Facility Agent, such Lender or any of their respective Affiliates by any such authority or body, including without limitation the Republic of France and any French Authority; (B) pursuant to subpoena or other court process; (C) when required to do so in accordance with the provisions of any applicable requirement of law; (D) to the extent reasonably required in connection with any litigation or proceeding to which the Facility Agent, any Lender or their respective Affiliates may be party; (E) to the extent reasonably required in connection with the exercise of any remedy hereunder; (F) to

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the Facility Agent or such Lender’s independent auditors, counsel, and any other professional advisors of the Facility Agent or such Lender who are advised of the confidentiality of such information; (G) to any participant or assignee, provided that such Person agrees to keep such information confidential to the same extent required of the Facility Agent and the Lenders hereunder; (H) as to the Facility Agent, any Lender or their respective Affiliates, as expressly permitted under the terms of any other document or agreement regarding confidentiality to which the Borrower or any Subsidiary is party with the Facility Agent, such Lender or such Affiliate; (I) to its Affiliates and its Affiliates’ directors, officers, employees, professional advisors and agents, provided that each such Affiliate, director, officer, employee, professional advisor or agent shall keep such information confidential to the same extent required of the Facility Agent and the Lenders hereunder; (J) to any other party to the Agreement and (K) to the French Authorities and any Person to whom information is required to be disclosed by the French Authorities. Each of the Facility Agent and the Lenders shall be responsible for any breach of this Section 11.15 by any of its Affiliates or any of its or its Affiliates’ directors, officers, employees, professional advisors and agents.

SECTION 11.16.    FRENCH AUTHORITY REQUIREMENTS. The Borrower acknowledges that:

a)    the Republic of France and any French Authority or any authorised representatives specified by these bodies shall be authorised at any time to inspect and make or demand copies of the records, accounts, documents and other deeds of any or all of the Lenders relating to this Agreement;

b)    in the course of its activity as the Facility Agent, the Facility Agent may:

i.    provide the Republic of France and any French Authority with information concerning the transactions to be handled by it under this Agreement; and

ii.    disclose information concerning the subsidized transaction contemplated by this Agreement in the context of internationally agreed consultation/notification proceedings and statutory specifications, including information received from the Lenders relating to this Agreement.

SECTION 11.17.    WAIVER OF IMMUNITY. To the extent that the Borrower has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its assets, the Borrower hereby irrevocably waives such immunity in respect of its obligations under this Agreement and the other Loan Documents.

SECTION 11.18.    ACKNOWLEDGEMENT AND CONSENT TO BAIL-IN OF EEA FINANCIAL INSTITUTIONS. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of a Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

a)    the application of any Write-Down and Conversion Powers by a Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

b)    the effects of any Bail-in Action on any such liability, including, if applicable:

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i.    a reduction in full or in part or cancellation of any such liability;

ii.    a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

iii.    the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any Resolution Authority.

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IN WITNESS WHEREOF, the parties hereto have caused this Hull No. L34 Credit Agreement to be executed by their respective officers thereunto duly authorized as of the day and year first above written.

ROYAL CARIBBEAN CRUISES LTD.
By
Name:
Title:

Address: 1050 Caribbean Way
Miami, Florida 33132
Facsimile No.: (305) 539-0562
Email: agibson@rccl.com
bstein@rccl.com
Attention: Vice President, Treasurer With a copy to: General Counsel

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Citibank N.A., London Branch as Global Coordinator

By
Name:
Title:

Citigroup Centre Canada Square
London E14 5LB United Kingdom
Attention: Wei-Fong Chan
Kara Catt Romina Coates
Antoine Paycha
Fax No: +44 20 7986 4881
Tel No: +44 20 7986 3036 /
+44 20 7508 0344
+44 20 7986 4824
+44 20 7500 0907 /
E-mail: weifong.chan@citi.com
kara.catt@citi.com
romina.coates@citi.com
antoine.paycha@citi.com

90

Banco Santander, S.A., Paris Branch as Lender

Commitment

9.7505744042% of the Maximum Loan Amount

By
Name:
Title:

Lending Office:

374 rue Saint Honoré 75001 Paris
France

Operational address:

Ciudad Financiera Avenida de Cantabria s/n
Edificio Encinar 2a planta 28600 Boadilla del
Monte Spain
Attention: Elise Regnault
Julián Arroyo Angela Rabanal
Ecaterina Mucuta Vanessa Berrio
Ana Sanz Gómez
Fax No: +34 91 257 1682
Tel No: +34 912893722 /
+1 212-297-2919
+1 212-297-2942
+33 1 53 53 70 46
+34 91 289 10 28
+34 91 289 17 90
E-mail: elise.regnault@gruposantander.com
Julian.Arroyo@santander.us arabanal@santander.us
Ecaterina.mucuta@gruposantander.com vaberrio@gruposantander.com anasanz@gruposantander.com
MiddleOfficeParis@gruposantander.com

91

BNP PARIBAS as Lender

Commitment
3.9306453494% of the Maximum Loan Amount

By
Name:
Title:

BNP PARIBAS
Front Office to keep copied to all matters. BNPP SA
37 RUE DU MARCHE SAINT HONORE
75001 PARIS ACI : CHC03B1
Alexandre de VATHAIRE / Mauricio GONZALEZ
alexandre.devathaire@bnpparibas.com mauricio.gonzalez@us.bnpparibas.com
Tel : 00 331 42 98 00 29/00 1212 841 38 88

Middle Office:

For Operational / Servicing matters

KHALID BOUITIDA /
THIERRY ANEZO / ESTELLE FARNY MILLENAIRE 4
35, RUE DE LA GARE
75019 PARIS ACI : CVA05A1
khalid.k.bouitida@bnpparibas.com
thierry.anezo@bnpparibas.com

estelle.farny@bnpparibas.com
Tel : 00 331 42 98 58 69 / 00 331 43 16 81 57 / 01 40 14 59 84

Back Office :

For Standard Settlement Instruction authentication/call-back
STEVE LOUISOR / VALERIE DUMOULIN MILLENAIRE 4
35, RUE DE LA GARE
75019 PARIS ACI : CVA03A1
paris.cib.boci.ca.3@bnpparibas.com
valerie.dumoulin@bnpparibas.com
steve.louisor@bnpparibas.com

ls1.loanservicinglisbon@bnpparibas.com
Tel : 00 331 55 77 91 86 / 00 331 40 14 46 59

92

HSBC CONTINENTAL EUROPE as Lender

Commitment

7.2499999337% of the Maximum Loan Amount

By
Name:
Title::

HSBC Continental Europe – Global Banking Agency Operations (GBAO)
Transaction Manager Unit
103 avenue des Champs Elysées 75008 Paris
France
Attention:
Florencia Thomas Alexandra Penda
Fax No: +33 1 40 70 28 80
Tel No: +33 1 40 70 73 81 /
+33 1 41 02 67 50
Email: florencia.thomas@hsbc.fr alexandra.penda@hsbc.fr

Copy to:

HSBC Continental Europe
103 avenue des Champs Elysées 75008 Paris
France
Attention: Julie Bellais
Celine Karsenty
Fax No: +33 1 40 70 78 93
Tel No: +33 1 40 70 28 59 /
+33140702297
Email: julie.bellais@hsbc.fr celine.karesenty@hsbc.fr

93

Société Générale as Lender

Commitment

9.9328352929% of the Maximum Loan Amount

By
Name:
Title:

Société Générale Facility Office 29 Boulevard
Haussmann
75009 Paris France

For operational/servicing matters:

Bouchra BOUMEZOUED / Tatiana BYCHKOVA

Société Générale

189, rue d’Aubervilliers 75886
PARIS CEDEX 18
OPER/FIN/CAF/DMT6
Phone: +33 1 57 29 13 12 / +33 1 58 98 43 05
Email: bouchra.boumezoued@sgcib.com
tatiana.bychkova@sgcib.com
par-oper-caf-dmt6@sgcib.com

For credit matters:

Francois ROLLAND / Mohamed MEROUANE

Société Générale

189, rue d’Aubervilliers 75886
PARIS CEDEX 18
GBSU/FTB/SMO/EXT
Phone: +33 1 58 98 17 78 / +33 1 58 98 92 06
Email: list.par-gbsu-ftb-smo-ext-aom@sgcib.com

94

SMBC Bank International plc
as ECA Agent and a Lender

Commitment

2.7360454163% of the Maximum Loan Amount

By
Name:
Title:
1/3/5 rue Paul Cézanne, 75008 Paris, France
Attention: Cedric Le Duigou
Guillaume Branco Herve Billi
Claire Lucien Helene Ly
Fax No: +33 1 44 90 48 01
Tel No:
Cedric Le Duigou: +33 1 44 90 48 83
Guillaume Branco: +33 1 44 90 48 71
Herve Billi: +33 1 44 90 48 48
Claire Lucien: +33 1 44 90 48 49
Helene Ly: +33 1 44 90 48 76
E-mail : cedric_leduigou@fr.smbcgroup.com
guillaume_branco@fr.smbcgroup.com
herve_billi@fr.smbcgroup.com
claire_lucien@fr.smbcgroup.com
helene_ly@fr.smbcgroup.com

95

SFIL as Lender

Commitment

66.3998996035% of the Maximum Amount

Loan

By
Name:
Title:
1-3, rue de Passeur de Boulogne – CS
80054
92861 Issy-les-Moulineaux Cedex 9
France
Contact Person

Loan Administration Department:

Direction du Crédit Export:

Pierre-Marie Debreuille / Anne Crépin

Direction des Opérations:

Dominique Brossard / Patrick Sick
Telephone:
Pierre-Marie Debreuille
+33 1 73 28 87 64
Anne Crépin +33 1 73 28 88 59
Dominique Brossard +33 1 73 28 91 93
Patrick Sick +33 1 73 28 87 66
Email:
pierre-marie.debreuille@sfil.fr
anne.crepin@sfil.fr
dominique.brossard@sfil.fr
patrick.sick@sfil.fr
refinancements-export@sfil.fr
creditexport_ops@sfil.fr
Fax: + 33 1 73 28 85 04

96

Citibank Europe plc, UK Branch as Facility Agent

By
Name:
Title:
5th Floor Citigroup Centre Mail drop CGC2
05-65
25 Canada Square Canary Wharf London E14 5LB
U.K.
Fax no.: +44 20 7492 3980
Attention: EMEA Loans Agency

97

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Jason T. Liberty, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Royal Caribbean Cruises Ltd.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 5, 2022
		/s/ Jason T. Liberty
		Jason T. Liberty
		President and
		Chief Executive Officer
		(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Naftali Holtz, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Royal Caribbean Cruises Ltd.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	May 5, 2022
		/s/ Naftali Holtz
		Naftali Holtz
		Chief Financial Officer
		(Principal Financial Officer)

EX-32.1

Exhibit 32.1

In connection with the quarterly report on Form 10-Q for the quarterly period ended March 31, 2022 as filed by Royal Caribbean Cruises Ltd. with the Securities and Exchange Commission on the date hereof (the “Report”), Jason T. Liberty, President and Chief Executive Officer, and Naftali Holtz, Chief Financial Officer, each hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1.the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and

2.the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Royal Caribbean Cruises Ltd.

Date:	May 5, 2022
		By:	/s/ Jason T. Liberty
			Jason T. Liberty
			President and
			Chief Executive Officer
			(Principal Executive Officer)
		By:	/s/ Naftali Holtz
			Naftali Holtz
			Chief Financial Officer
			(Principal Financial Officer)

XML

Cover Page - shares	3 Months Ended
	Mar. 31, 2022	May 02, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Document Transition Report	false
Entity File Number	1-11884
Entity Registrant Name	ROYAL CARIBBEAN CRUISES LTD
Entity Incorporation, State or Country Code	N0
Entity Tax Identification Number	98-0081645
Entity Address, Address Line One	1050 Caribbean Way
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33132
City Area Code	305
Local Phone Number	539-6000
Title of 12(b) Security	Common Stock, par value $0.01 per share
Trading Symbol	RCL
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		254,956,303
Entity Central Index Key	0000884887
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1

XML

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Total revenues	$ 1,059,231	$ 42,014
Cruise operating expenses:
Total cruise operating expenses	1,184,769	283,487
Marketing, selling and administrative expenses	394,030	258,041
Depreciation and amortization expenses	339,467	310,166
Impairment and credit losses (recoveries)	173	(449)
Operating Loss	(859,208)	(809,231)
Other income (expense):
Interest income	3,322	4,861
Interest expense, net of interest capitalized	(277,659)	(272,514)
Equity investment loss	(31,059)	(59,871)
Other (expense) income	(2,538)	5,033
Total other income (expense)	(307,934)	(322,491)
Net Loss	$ (1,167,142)	$ (1,131,722)
Loss per Share:
Basic (in dollars per share)	$ (4.58)	$ (4.66)
Diluted (in dollars per share)	$ (4.58)	$ (4.66)
Weighted-Average Shares Outstanding:
Basic (in shares)	254,821	243,004
Diluted (in shares)	254,821	243,004
Comprehensive Loss
Net Loss	$ (1,167,142)	$ (1,131,722)
Net Loss	(1,167,142)	(1,131,722)
Other comprehensive income:
Foreign currency translation adjustments	7,778	9,722
Change in defined benefit plans	12,597	10,463
Gain on cash flow derivative hedges	195,901	10,302
Total other comprehensive income	216,276	30,487
Comprehensive Loss	(950,866)	(1,101,235)
Passenger ticket revenues
Total revenues	651,858	20,844
Onboard and other revenues
Total revenues	407,373	21,170
Cruise operating expenses:
Total cruise operating expenses	74,439	4,481
Commissions, transportation and other
Cruise operating expenses:
Total cruise operating expenses	150,343	2,949
Payroll and related
Cruise operating expenses:
Total cruise operating expenses	349,618	96,636
Food
Cruise operating expenses:
Total cruise operating expenses	100,184	8,472
Fuel
Cruise operating expenses:
Total cruise operating expenses	188,480	41,822
Other operating
Cruise operating expenses:
Total cruise operating expenses	$ 321,705	$ 129,127

XML

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Current assets
Cash and cash equivalents	$ 1,968,504	$ 2,701,770
Trade and other receivables, net of allowances of $6,099 and $13,411 at March 31, 2022 and December 31, 2021, respectively	506,160	408,067
Inventories	179,466	150,224
Prepaid expenses and other assets	344,648	286,026
Derivative financial instruments	178,161	54,184
Total current assets	3,176,939	3,600,271
Property and equipment, net	26,940,867	25,907,949
Operating lease right-of-use assets	535,532	542,128
Goodwill	809,435	809,383
Other assets, net of allowances of $86,594 and $86,781 at March 31, 2022 and December 31, 2021, respectively	1,477,225	1,398,624
Total assets	32,939,998	32,258,355
Current liabilities
Current portion of long-term debt	2,558,463	2,243,131
Current portion of operating lease liabilities	74,234	68,922
Accounts payable	668,158	545,978
Accrued interest	263,347	251,974
Accrued expenses and other liabilities	774,007	887,575
Derivative financial instruments	101,554	127,236
Customer deposits	3,567,401	3,160,867
Total current liabilities	8,007,164	7,285,683
Long-term debt	19,943,513	18,847,209
Long-term operating lease liabilities	523,924	534,726
Other long-term liabilities	476,469	505,181
Total liabilities	28,951,070	27,172,799
Shareholders’ equity
Preferred stock ($0.01 par value; 20,000,000 shares authorized; none outstanding)	0	0
Common stock ($0.01 par value; 500,000,000 shares authorized; 282,973,716 and 282,703,246 shares issued, March 31, 2022 and December 31, 2021, respectively)	2,830	2,827
Paid-in capital	7,267,545	7,557,297
Retained (deficit) earnings	(718,609)	302,276
Accumulated other comprehensive loss	(494,609)	(710,885)
Treasury stock (28,018,385 and 27,882,987 common shares at cost, March 31, 2022 and December 31, 2021, respectively)	(2,068,229)	(2,065,959)
Total shareholders’ equity	3,988,928	5,085,556
Total liabilities and shareholders’ equity	$ 32,939,998	$ 32,258,355

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Trade and other receivables, allowance for credit loss	$ 6,099	$ 13,411
Other assets, allowance for credit loss	$ 86,594	$ 86,781
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	20,000,000	20,000,000
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, shares issued (in shares)	282,973,716	282,703,246
Treasury stock, common shares (in shares)	28,018,385	27,882,987

XML

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Operating Activities
Net Loss	$ (1,167,142)	$ (1,131,722)
Adjustments:
Depreciation and amortization	339,467	310,166
Impairment and credit losses (recoveries)	173	(449)
Net deferred income tax benefit	(3,067)	(3,556)
Loss on derivative instruments not designated as hedges	10,873	491
Share-based compensation expense	22,839	18,834
Equity investment loss	31,059	59,871
Amortization of debt issuance costs	39,341	35,581
Amortization of debt discounts and premiums	3,849	29,304
Changes in operating assets and liabilities:
Increase in trade and other receivables, net	(32,236)	(72,397)
Increase in inventories	(29,242)	(3,708)
Increase in prepaid expenses and other assets	(124,394)	(26,118)
Increase (decrease) in accounts payable	112,426	(7,499)
Increase (decrease) in accrued interest	11,373	(15,726)
Decrease in accrued expenses and other liabilities	(130,441)	(134,113)
Increase in customer deposits	406,534	95,923
Other, net	(20,259)	35,935
Net cash used in operating activities	(528,847)	(809,183)
Investing Activities
Purchases of property and equipment	(1,363,086)	(1,061,691)
Cash received on settlement of derivative financial instruments	5,650	3,758
Cash paid on settlement of derivative financial instruments	(77,853)	(27,362)
Investments in and loans to unconsolidated affiliates	0	(70,369)
Cash received on loans to unconsolidated affiliates	4,444	12,519
Proceeds from the sale of property and equipment and other assets	65	175,439
Other, net	(12,361)	146
Net cash used in investing activities	(1,443,141)	(967,560)
Financing Activities
Debt proceeds	2,349,969	2,494,077
Debt issuance costs	(93,763)	(82,115)
Repayments of debt	(1,007,632)	(427,978)
Repayments of commercial paper notes	0	(414,570)
Proceeds from common stock issuances	0	1,617,234
Other, net	(10,843)	(2,724)
Net cash provided by financing activities	1,237,731	3,183,924
Effect of exchange rate changes on cash	991	(192)
Net (decrease) increase in cash and cash equivalents	(733,266)	1,406,989
Cash and cash equivalents at beginning of period	2,701,770	3,684,474	$ 3,684,474
Cash and cash equivalents at end of period	1,968,504	5,091,463	$ 2,701,770
Cash paid during the period for:
Interest, net of amount capitalized	225,771	228,877
Non-cash Investing Activities
Notes receivable issued upon sale of property and equipment and other assets	0	16,000
Purchase of property and equipment included in accounts payable and accrued expenses and other liabilities	$ 31,899	$ 26,882

XML

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Paid-in Capital	Paid-in Capital Cumulative Effect, Period of Adoption, Adjustment	Retained Earnings (Deficit)	Retained Earnings (Deficit) Cumulative Effect, Period of Adoption, Adjustment	Accumulated Other Comprehensive Loss	Treasury Stock
Beginning balance at Dec. 31, 2020	$ 8,760,669		$ 2,652	$ 5,998,574		$ 5,562,775		$ (739,341)	$ (2,063,991)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Activity related to employee stock plans	18,640		2	18,638
Common stock issuance	1,496,276		170	1,496,106
Changes related to cash flow derivative hedges	10,302							10,302
Change in defined benefit plans	10,463							10,463
Foreign currency translation adjustments	9,722							9,722
Purchase of treasury stock	(1,968)								(1,968)
Net Loss	(1,131,722)					(1,131,722)
Ending balance at Mar. 31, 2021	9,172,382		2,824	7,513,318		4,431,053		(708,854)	(2,065,959)
Beginning balance at Dec. 31, 2020	8,760,669		2,652	5,998,574		5,562,775		(739,341)	(2,063,991)
Ending balance at Dec. 31, 2021	$ 5,085,556	$ (161,420)	2,827	7,557,297	$ (307,640)	302,276	$ 146,220	(710,885)	(2,065,959)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Accounting Standards Update [Extensible Enumeration]	Accounting Standards Update 2020-06 [Member]
Activity related to employee stock plans	$ 17,928		3	17,888		37
Changes related to cash flow derivative hedges	195,901							195,901
Change in defined benefit plans	12,597							12,597
Foreign currency translation adjustments	7,778							7,778
Purchase of treasury stock	(2,270)								(2,270)
Net Loss	(1,167,142)					(1,167,142)
Ending balance at Mar. 31, 2022	$ 3,988,928		$ 2,830	$ 7,267,545		$ (718,609)		$ (494,609)	$ (2,068,229)

XML

General

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

General

Note 1. General

Description of Business 

We are a global cruise company. We own and operate three global cruise brands: Royal Caribbean International, Celebrity Cruises and Silversea Cruises (collectively, our "Global Brands"). We also own a 50% joint venture interest in TUI Cruises GmbH ("TUIC"), which operates the German brands TUI Cruises and Hapag-Lloyd Cruises (collectively, our "Partner Brands"). We account for our investments in our Partner Brands under the equity method of accounting. Together, our Global Brands and our Partner Brands have a combined fleet of 62 ships as of March 31, 2022. Our ships offer a selection of worldwide itineraries that call on more than 1,000 destinations on all seven continents.

Management's Plan and Liquidity

During 2021, we restarted our global cruise operations in a phased manner, following our voluntary suspension of global cruise operations that commenced in March of 2020 in response to the COVID-19 pandemic. Since then, we have steadily increased the number of ships that have returned to service. As of March 31, 2022, we returned to service 54 of our Global and Partner Brand ships, representing close to 90% of our worldwide capacity. Our return to service efforts incorporate our enhanced health and safety protocols, and the requirements of regulatory agencies, which has resulted in reduced guest occupancy, modified itineraries and vaccination protocols.

Uncertainties remain as to the continuing effects COVID-19 will have on our operations, including potential increases in infection rates, new variants, and renewed governmental action to slow the spread of COVID-19, which may lead us to cancel or modify certain of our Global Brands’ cruise sailings. Additionally, there is uncertainty surrounding consumer behavior and demand for cruising. The continuing effects of COVID-19 to our guest cruise operations and the increased uncertainty given the current war in Ukraine, including its effect on the price of fuel and food, are collectively having a material negative impact on our business, including our liquidity, financial position and results of operations.

Significant events affecting travel, including COVID-19, typically impact the booking pattern for cruise vacations, with the full extent of the impact generally determined by the length of time the event influences travel decisions. The estimation of our future liquidity requirements include numerous assumptions that are subject to various risks and uncertainties. The principal assumptions used to estimate our future liquidity requirements consist of:

•Expected continued resumption of cruise operations and timing of cash collections for cruise bookings;

•Expected increase in revenue per available passenger cruise day during our continued resumption of cruise operations;

•Expected lower than comparable historical occupancy levels during our continued resumption of cruise operations, increasing over time until we reach historical occupancy levels; and

•Expected spend during our continued resumption of cruise operations, including returning our crew members to our vessels and maintaining enhanced health and safety protocols.

There can be no assurance that our assumptions and estimates are accurate due to the uncertainties noted above. Since the start of the pandemic, we have implemented a number of proactive measures to mitigate the financial and operational impacts of COVID-19, including reduction of capital expenditures and operating expenses, the issuance of debt and shares of our common stock, the amendment of credit agreements to defer payments, the waiver and/or modification of covenant requirements and the suspension of dividend payments. Additionally, we expect to continue to pursue refinancing opportunities to reduce interest expense and extend maturities.

As of March 31, 2022, we had liquidity of $3.8 billion, including $1.1 billion of undrawn revolving credit facility capacity, $2.0 billion in cash and cash equivalents, and a $0.7 billion commitment for a 364-day term loan facility available to draw on at any time prior to August 12, 2022. Our revolving credit facilities were partially utilized through a combination of amounts drawn and letters of credit issued under the facilities as of March 31, 2022.

As of March 31, 2022, we were in compliance with our financial covenants and we estimate we will be in compliance for the next twelve months. Refer to Note 6. Debt for further information regarding the amendments made to our debt facilities and credit card processing agreements, including related covenants.

Based on our assumptions regarding the impact of COVID-19 and our resumption of operations, as well as our present financial condition, we believe that we have sufficient financial resources to fund our obligations for at least the next twelve months from the issuance of these financial statements.

Beyond the next 12 months, in June of 2023, approximately $3.2 billion of long- term debt will become due. Accordingly, in addition to our $3.8 billion liquidity as of March 31 2022, in February 2022 we entered into certain agreements with Morgan Stanley & Co., LLC (“MS”) where MS agreed to provide backstop committed financing to refinance, repurchase and/or repay in whole or in part our existing and outstanding 10.875% Senior Secured Notes due 2023, 9.125% Senior Priority Guaranteed Notes due 2023 (the "Priority Guaranteed Notes"), and 4.25% Convertible Notes due 2023. Pursuant to the agreements, we may, at our sole option, issue and sell to MS (subject to the satisfaction of certain conditions) five-year senior unsecured notes with gross proceeds of up to $3.15 billion at any time between April 1, 2023 and June 29, 2023, to refinance the aforementioned notes.

If the Company is unable to maintain the required minimum level of liquidity or negotiate its minimum liquidity requirements, it could have a significant adverse effect on the Company’s business, financial condition and operating results.

Basis for Preparation of Consolidated Financial Statements

The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any items discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such Securities and Exchange Commission rules and regulations. Estimates are required for the preparation of financial statements in accordance with these principles. Actual results could differ from these estimates. Refer to Note 2. Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of our significant accounting policies.

All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50%, and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 5. Other Assets for further information regarding our variable interest entities. For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50%, the investment is accounted for using the equity method.

Effective March 19, 2021, we sold our wholly-owned brand, Azamara Cruises ("Azamara"), including its three-ship fleet and associated intellectual property, to Sycamore Partners for $201 million, subject to closing adjustments. The March 2021 sale of Azamara did not represent a strategic shift that will have a major effect on our operations and financial results, as we continue to provide similar itineraries to and source passengers from the markets served by the Azamara business. Therefore, the sale of Azamara did not meet the criteria for discontinued operations reporting. Effective March 19, 2021, we no longer consolidate Azamara's balance sheet nor recognize its results of operations in our consolidated financial statements. We recognized an immaterial gain on the sale during the quarter ended March 31, 2021 and have agreed to provide certain transition services to Azamara for a period of time for a fee.

Prior to October 1, 2021, we consolidated the operating results of Silversea Cruises on a three-month reporting lag to allow for more timely preparation of our consolidated financial statements. Effective October 1, 2021, we eliminated the three-

month reporting lag to reflect Silversea Cruises' financial position, results of operations and cash flows concurrently and consistently with the fiscal calendar of the Company ("elimination of the Silversea reporting lag"). The elimination of the Silversea reporting lag represents a change in accounting principle which we believe to be preferable because it provides more current information to the users of our financial statements. A change in accounting principle requires retrospective application, if material. The impact of the elimination of the reporting lag was immaterial to prior periods and was immaterial for our fiscal year ended December 31, 2021. As a result, we have accounted for this change in accounting principle in our consolidated results for the quarter and year ended December 31, 2021. Accordingly, the results of Silversea Cruises from January 1, 2022 through March 31, 2022 are included in our consolidated statement of comprehensive loss for the quarter ended March 31, 2022 and the results of Silversea Cruises from October 1, 2020 through December 31, 2020 are included in our consolidated statement of comprehensive loss for the quarter ended March 31, 2021.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Note 2. Summary of Significant Accounting Policies

Adoption of Accounting Pronouncements

In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) ("ASU 2020-06"), which simplifies the accounting for convertible instruments. The guidance removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments, requiring bifurcation only if the convertible debt feature qualifies as a derivative under ASC 815 or for convertible debt issued at a substantial premium. The ASU removes certain settlement conditions required for equity contracts to qualify for the derivative scope exception, permitting more contracts to qualify for it. In addition, the guidance eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. The guidance also decreases interest expense due to the reversal of the remaining non-cash convertible debt discount. On January 1, 2022, we adopted this pronouncement using the modified retrospective approach to recognize our convertible notes as single liability instruments given they do not qualify as derivatives under ASC 815, nor were they issued at a substantial premium. Accordingly, as of January 1, 2022, we recorded a $161.4 million increase to debt, primarily as a result of the reversal of the remaining non-cash convertible debt discount, as well as a reduction of $307.6 million to additional paid in capital, which resulted in a cumulative effect on adoption of approximately $146.2 million to increase retained earnings.

Recent Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB") issued Accounting Standard Update (“ASU") No. 2020-04, Reference Rate Reform (Topic 848), which provides optional expedients and exceptions to the current guidance on contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. Subsequently, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848), which presents amendments to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance in both ASUs was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. We are currently evaluating the impact of the new guidance on our consolidated financial statements. The impact, if any, will be dependent on the terms of any future contract modifications related to a change in reference rate.

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Revenues

3 Months Ended

Mar. 31, 2022

Revenue from Contract with Customer [Abstract]

Revenues

Note 3. Revenues

Revenue Recognition

Revenues are measured based on consideration specified in our contracts with customers and are recognized as the related performance obligations are satisfied.

The majority of our revenues are derived from passenger cruise contracts which are reported within Passenger ticket revenues in our consolidated statements of comprehensive loss. Our performance obligation under these contracts is to provide a cruise vacation in exchange for the ticket price. We satisfy this performance obligation and recognize revenue over the duration of each cruise, which generally range from two to 25 nights.

Passenger ticket revenues include charges to our guests for port costs that vary with passenger head counts. These type of port costs, along with port costs that do not vary by passenger head counts, are included in our cruise operating expenses. The

amounts of port costs charged to our guests and included within Passenger ticket revenues on a gross basis were $76.9 million and $1.5 million for the quarters ended March 31, 2022 and 2021, respectively.

Our total revenues also include Onboard and other revenues, which consist primarily of revenues from the sale of goods and services onboard our ships that are not included in passenger ticket prices. We receive payment before or concurrently with the transfer of these goods and services to passengers during a cruise and recognize revenue over the duration of the related cruise.

As a practical expedient, we have omitted disclosures on our remaining performance obligations as the duration of our contracts with customers is less than a year.

Disaggregated Revenues

The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands):

	Quarter Ended March 31,
	2022		2021
Revenues by itinerary
North America (1)	$	889,087	$	—
Asia/Pacific	34,633		29,885
Europe	1,425		—
Other regions(2)	79,633		810
Total revenues by itinerary	1,004,778		30,695
Other revenues(3)	54,453		11,319
Total revenues	$	1,059,231	$	42,014

(1)Includes the United States, Canada, Mexico and the Caribbean.

(2) Includes seasonality impacted itineraries primarily in South and Latin American countries.

(3) Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 5. Other Assets for more information on our unconsolidated affiliates.

Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended March 31, 2022 and 2021, our guests were sourced from the following areas:

	Quarter Ended March 31,
	2022		2021
Passenger ticket revenues:
United States	84	%	—	%
Singapore	4	%	69	%
China	—	%	31	%
All other countries (1)	12	%	—	%

(1)No other individual country's revenue exceeded 10% for the quarters ended March 31, 2022 and 2021.

Customer Deposits and Contract Liabilities

Our payment terms generally require an upfront deposit to confirm a reservation, with the balance due prior to the cruise. Deposits received on sales of passenger cruises are initially recorded as Customer deposits in our consolidated balance sheets and subsequently recognized as passenger ticket revenues during the duration of the cruise. ASC 606, Revenues from Contracts with Customers, defines a “contract liability” as an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. We do not consider customer deposits to be a contract liability until the customer no longer retains the unilateral right, resulting from the passage of time, to cancel such customer's reservation and receive a full refund. Customer deposits presented in our consolidated balance sheets include contract liabilities of $1.2 billion and $0.8 billion as of March 31, 2022 and December 31, 2021, respectively.

The COVID-19 pandemic has impacted the predictability of bookings and the associated customer deposits received. During the onset of the COVID-19 pandemic and subsequent emergence of related variants, we experienced significant cancellations, which led to the issuance of cash refunds to customers or credits for future cruises. As of March 31, 2022, refunds due to customers were $35.2 million compared to $38.8 million as of December 31, 2021, and are included within Accounts payable in our consolidated balance sheets.

We have provided flexibility to guests with bookings on sailings cancelled due to COVID-19 by allowing guests to receive future cruise credits (“FCC”) or elect to receive refunds in cash. As of March 31, 2022, our customer deposit balance includes approximately $0.6 billion of unredeemed FCCs. As of March 31, 2022, the expiration date of the FCCs was extended through December 31, 2022, or one year from the original sailing date, whichever is later. Given the uncertainty of travel demand caused by COVID-19 and lack of comparable historical experience of FCC redemptions, we are unable to estimate the number of FCCs that may expire unused in future periods and get recognized as breakage. We will update our breakage analysis as future information is received.

Contract Receivables and Contract Assets

Although we generally require full payment from our customers prior to their cruise, we grant credit terms to a relatively small portion of our revenue sourced in select markets outside of the United States. As a result, we have outstanding receivables from passenger cruise contracts in those markets. We also have receivables from credit card merchants for cruise ticket purchases and goods and services sold to guests during cruises that are collected before, during or shortly after the cruise voyage. In addition, we have receivables due from concessionaires onboard our vessels. These receivables are included within Trade and other receivables, net in our consolidated balance sheets.

We have contract assets that are conditional rights to consideration for satisfying the construction services performance obligations under a service concession arrangement. As of March 31, 2022 and December 31, 2021, our contract assets were $95.4 million and $52.9 million, respectively, and were included within Other assets in our consolidated balance sheets. Given the short duration of our cruises and our collection terms, we do not have any other significant contract assets.

Assets Recognized from the Costs to Obtain a Contract with a Customer

Prepaid travel advisor commissions are an incremental cost of obtaining contracts with customers that we recognize as an asset and include within Prepaid expenses and other assets in our consolidated balance sheets. Prepaid travel advisor commissions were $94.7 million as of March 31, 2022 and $75.4 million as of December 31, 2021. Substantially all of our prepaid travel advisor commissions at December 31, 2021 were expensed and reported primarily within Commissions, transportation and other in our consolidated statements of comprehensive loss for the quarter ended March 31, 2022.

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(Loss) Per Share

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

(Loss) Per Share

Note 4. (Loss) Per Share

Basic and diluted (loss) per share is as follows (in thousands, except per share data):

	Quarter Ended March 31,
	2022		2021
Net (Loss) for basic and diluted loss per share	$	(1,167,142)	$	(1,131,722)
Weighted-average common shares outstanding	254,821		243,004
Diluted weighted-average shares outstanding	254,821		243,004
Basic (loss) per share	$	(4.58)	$	(4.66)
Diluted (loss) per share	$	(4.58)	$	(4.66)

Basic loss per share is computed by dividing Net Loss by the weighted-average number of common stock outstanding during each period. Diluted loss per share incorporates the incremental shares issuable upon the assumed exercise of stock options and conversion of potentially dilutive securities. As we had net losses for the three months ended March 31, 2022 and March 31, 2021, all potential common shares were determined to be antidilutive, resulting in the same basic and diluted net loss per share amounts for both these periods. There were approximately 23,407,179 and 413,501 antidilutive shares for the quarters ended March 31, 2022 and March 31, 2021, respectively.

Effective January 1, 2022, ASU 2020-06 eliminated the treasury stock method and instead required the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share when the instruments may be settled in cash or shares. Under the if-converted method, shares related to our convertible notes, to the extent dilutive, are assumed to be converted into common stock at the beginning of the reporting period. The required use of the if-converted

method did not impact our diluted net loss per share as the Company was in a net loss position. For further information regarding the adoption of ASU 2020-06, refer to Note 2. Summary of Significant Accounting Policies.

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Other Assets

3 Months Ended

Mar. 31, 2022

Other Assets [Abstract]

Other Assets

Note 5. Other Assets

A Variable Interest Entity (“VIE”) is an entity in which the equity investors have not provided enough equity to finance the entity’s activities or the equity investors: (1) cannot directly or indirectly make decisions about the entity’s activities through their voting rights or similar rights; (2) do not have the obligation to absorb the expected losses of the entity; (3) do not have the right to receive the expected residual returns of the entity; or (4) have voting rights that are not proportionate to their economic interests and the entity’s activities involve or are conducted on behalf of an investor with a disproportionately small voting interest.

We have determined that TUI Cruises GmbH ("TUIC"), our 50%-owned joint venture, which operates the brands TUI Cruises and Hapag-Lloyd Cruises, is a VIE. We have determined that we are not the primary beneficiary of TUIC. We believe that the power to direct the activities that most significantly impact TUIC’s economic performance is shared between ourselves and TUI AG, our joint venture partner. All the significant operating and financial decisions of TUIC require the consent of both parties, which we believe creates shared power over TUIC. Accordingly, we do not consolidate this entity and account for this investment under the equity method of accounting.

As of March 31, 2022, the net book value of our investment in TUIC was $404.0 million, primarily consisting of $286.2 million in equity and a loan of €99.1 million, or approximately $110.2 million based on the exchange rate at March 31, 2022. As of December 31, 2021, the net book value of our investment in TUIC was $444.4 million, primarily consisting of $322.4 million in equity and a loan of €103.0 million, or approximately $117.2 million based on the exchange rate at December 31, 2021. The loan, which was made in connection with the sale of Splendour of the Seas in April 2016, accrues interest at a rate of 6.25% per annum and is payable over 10 years. This loan is 50% guaranteed by TUI AG and is secured by a first priority mortgage on the ship. The majority of these amounts were included within Other assets in our consolidated balance sheets. During the quarter ended March 31, 2021, we and TUI AG each contributed €59.5 million, or approximately $69.9 million based on the exchange rate at March 31, 2021, of additional equity through a combination of cash contributions and conversion of existing receivables.

TUIC has various ship construction and financing agreements which include certain restrictions on each of our and TUI AG’s ability to reduce our current ownership interest in TUI Cruises below 37.55% through May 2033. Our investment amount and outstanding term loan are substantially our maximum exposure to loss in connection with our investment in TUIC.

We have determined that Grand Bahama Shipyard Ltd. ("Grand Bahama"), a ship repair and maintenance facility in which we have a 40% noncontrolling interest, is a VIE. This facility serves cruise and cargo ships, oil and gas tankers and offshore units. We utilize this facility, among other ship repair facilities, for our regularly scheduled drydocks and certain emergency repairs as may be required. During the quarter ended March 31, 2022, we made payments of $3.7 million to Grand Bahama for ship repair and maintenance services. We have determined that we are not the primary beneficiary of this facility as we do not have the power to direct the activities that most significantly impact the facility’s economic performance. Accordingly, we do not consolidate this entity.

As of March 31, 2022, we had exposure to credit loss in Grand Bahama consisting of a $10.6 million loan. Our loan to Grand Bahama matures March 2026 and bears interest at LIBOR plus 3.5% to 3.75%, capped at 5.75%. Interest payable on the loan is due on a semi-annual basis. During the quarter ended March 31, 2021, we received principal and interest payments of $8.9 million related to a term loan that had fully matured. We did not receive principal and interest payments during the quarter ended March 31, 2022. The outstanding loan balance is in non-accrual status and is included within Trade and other receivables, net and Other assets in our consolidated balance sheets. In addition, we are currently recognizing our share of net accumulated equity method losses against the carrying value of our loan receivable from Grand Bahama. We monitor credit risk associated with the loan through our participation on Grand Bahama’s board of directors along with our review of Grand Bahama’s financial statements and projected cash flows. 

The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands):

	Quarter Ended March 31,
	2022		2021
Share of equity (loss) income from investments	$	(31,059)	$	(59,871)
Dividends received (1)	$	423	$	—

(1) Represents dividends received from our investments accounted for under the equity method of accounting for the quarters ended March 31, 2022 and March 31, 2021.

	As of March 31, 2022		As of December 31, 2021
Total notes receivable due from equity investments	$	123,157	$	130,587
Less-current portion (1)	21,069		21,508
Long-term portion (2)	$	102,088	$	109,079

(1)Included within Trade and other receivables, net in our consolidated balance sheets.

(2)Included within Other assets in our consolidated balance sheets.

We also provide ship management services to TUIC and recorded the following as it relates to these services in our operating results within our consolidated statements of comprehensive income (loss) (in thousands):

	Quarter Ended March 31,
	2022		2021
Revenues	$	6,372	$	5,231
Expenses	$	1,826	$	1,275

Credit Losses

We reviewed our notes receivable for credit losses in connection with the preparation of our financial statements for the quarter ended March 31, 2022. In evaluating the allowance, management considered factors such as historical loss experience, the types of loans and the amount of loans in the loan portfolio, adverse situations that may affect the borrower’s ability to repay, the estimated value of any underlying collateral, peer group information and prevailing economic conditions. Based on these credit loss estimation factors, during the quarter ended March 31, 2022, we recorded a loss provision of $0.7 million. Our credit loss allowance beginning and ending balances as of January 1, 2022 and March 31, 2022 primarily relate to credit losses recognized on notes receivable for the previous sale of our property and equipment of $81.6 million and other receivable balances primarily related to loans due from travel advisors of $12.6 million.

The following table summarizes our credit loss allowance related to receivables for the three months ended March 31, 2022 (in thousands):

	Credit Loss Allowance
Beginning balance January 1, 2022	$	100,192
Loss provision for receivables	653
Write-offs	(8,152)
Ending balance March 31, 2022	$	92,693

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Debt

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Debt

Note 6. Debt

Debt consist of the following (in thousands):

	Interest Rate (1)	Maturities Through	As of March 31, 2022		As of December 31, 2021
Fixed rate debt:
Unsecured senior notes	3.70% to 9.13%	2022 - 2028	$	6,598,558	$	5,604,498
Secured senior notes	10.88% to 11.50%	2023 - 2025	2,357,803		2,354,037
Unsecured term loans	2.53% to 5.89%	2028 - 2034	4,114,508		2,860,567
Convertible notes	2.88% to 4.25%	2023	1,725,000		1,558,780
Total fixed rate debt			14,795,869		12,377,882
Variable rate debt:
Unsecured revolving credit facilities (2)	1.75% to 2.15%	2022 - 2024	1,909,342		2,899,342
USD unsecured term loan	1.84% to 4.95%	2022 - 2033	5,114,768		5,018,740
Euro unsecured term loan	1.15% to 2.25%	2022 - 2028	670,500		685,633
Total variable rate debt			7,694,610		8,603,715
Finance lease liabilities			428,387		472,275
Total debt (3)			22,918,866		21,453,872
Less: unamortized debt issuance costs			(416,890)		(363,532)
Total debt, net of unamortized debt issuance costs			22,501,976		21,090,340
Less—current portion			(2,558,463)		(2,243,131)
Long-term portion			$	19,943,513	$	18,847,209

(1) Interest rates based on outstanding loan balance as of March 31, 2022 and, for variable rate debt, include either LIBOR or EURIBOR plus the applicable margin.

(2) Includes $1.9 billion facility and $1.3 billion facility, the vast majority of which is due in 2024. Our $1.9 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.30%, which interest was 1.75% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.20%. Our $1.3 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.70%, which interest was 2.15% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.30%.

(3) At March 31, 2022 and December 31, 2021, the weighted average interest rate for total debt was 5.61% and 5.47%, respectively.

In January 2022, we took delivery of Wonder of the Seas. To finance the delivery, we borrowed a total of $1.3 billion under a credit agreement novated to us upon delivery of the ship in January 2022, resulting in an unsecured term loan which is 100% guaranteed by Bpifrance Assurance Export ("BpiFAE"), the official export credit agency ("ECA") of France. The unsecured loan amortizes semi-annually over 12 years and bears interest at a fixed rate of 3.18% per annum.

In January 2022, we issued $1.0 billion of senior notes (the "January 2022 Unsecured Notes") due in 2027 for net proceeds of approximately $990.0 million. Interest accrues on the January 2022 Unsecured Notes at a fixed rate of 5.375% per annum and is payable semi-annually in arrears. The proceeds from the January 2022 Unsecured Notes will be used to repay principal payments on debt maturing in 2022 (including to pay fees and expenses in connection with such repayments). Pending such debt maturities, we have temporarily applied the proceeds to repay borrowings under our revolving credit facilities, bringing our undrawn revolving credit facility capacity to $1.1 billion as of March 31, 2022.

In February 2022, we entered into certain agreements with MS where MS agreed to provide backstop committed financing to refinance, repurchase and/or repay in whole or in part our existing and outstanding 10.875% Senior Secured Notes due 2023, Priority Guaranteed Notes and 4.25% Convertible Notes due 2023. Pursuant to the agreements, we may, at our sole option, issue and sell to MS (subject to the satisfaction of certain conditions) five-year senior unsecured notes with gross proceeds of up to $3.15 billion at any time between April 1, 2023 and June 29, 2023, to refinance the aforementioned notes.

In April 2022, we took delivery of Celebrity Beyond. To finance the delivery, we borrowed a total of €0.7 billion under a credit agreement novated to us upon delivery of the ship in April 2022, resulting in an unsecured term loan which is 100% guaranteed by BpiFAE. The unsecured loan amortizes semi-annually over 12 years and bears interest at a fixed rate of 1.28% per annum.

As of March 31, 2022, our aggregate revolving borrowing capacity was $3.2 billion and was partially utilized through a combination of amounts drawn and letters of credits issued under the facilities. Certain of our surety agreements with third party providers for the benefit of certain agencies and associations that provide travel related bonds, allow the sureties to request collateral. We also have agreements with our credit card processors relating to customer deposits received by us for future voyages. These agreements allow the credit card processors to require us, under certain circumstances, to maintain a reserve that can be satisfied by posting collateral. As of March 31, 2022, we have posted letters of credit as collateral with our sureties and credit card processors under our revolving credit facilities in the amount of $117.2 million

Executed amendments are in place for the majority of our credit card processors, waiving reserve requirements tied to the breach of our financial covenants through at least September 30, 2022, with modified covenants thereafter, and as such, we do not anticipate any incremental collateral requirements for the processors covered by these waivers in the next 12 months. We have a reserve with a processor where the agreement was amended in the first quarter of 2021, such that proceeds are withheld in reserve, until the sailing takes place or the funds are refunded to the customer. The maximum projected exposure with the processor, including amounts currently withheld and reported in Trade and other receivables, is approximately $293.9 million. The amount and timing are dependent on future factors that are uncertain, such as the date we return to operations, volume and value of future deposits and whether we transfer our business to other processors. If we require additional waivers on the credit card processing agreements and are not able to obtain them, this could lead to the termination of these agreements or the trigger of reserve requirements.

Except for the term loans we incurred to acquire Celebrity Flora and Silver Moon, all of our unsecured ship financing term loans are guaranteed by the export credit agency in the respective country in which the ship is constructed. For the majority of the loans as of March 31, 2022, we pay to the applicable export credit agency, depending on the financing agreement, an upfront fee of 2.35% to 5.48% of the maximum loan amount in consideration for these guarantees. We amortize the fees that are paid upfront over the life of the loan. We classify these fees within Amortization of debt issuance costs in our consolidated statements of cash flows. Prior to the loan being drawn, we present these fees within Other assets in our consolidated balance sheets. Once the loan is drawn, such fees are classified as a discount to the related loan, or contra-liability account, within Current portion of long-term debt or long-term debt.

The following is a schedule of annual maturities on our total debt, net of debt issuance costs and including finance leases, as of March 31, 2022 for each of the next five years (in thousands):

Year
Remainder of 2022	2,273,401
2023	5,665,482
2024	3,128,924
2025	2,417,492
2026	2,614,571
Thereafter	6,402,106
	22,501,976

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Leases

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Leases

Note 7. Leases

Operating Leases

Our operating leases primarily relate to preferred berthing arrangements, real estate and shipboard equipment, and are included within Operating lease right-of-use assets, and Long-term operating lease liabilities with the current portion of the liability included within Current portion of operating lease liabilities in our consolidated balance sheets as of March 31, 2022 and December 31, 2021. Leases with an initial term of 12 months or less are not recorded on our consolidated balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. Our operating leases include Silver Explorer, operated by Silversea Cruises. The operating lease for Silver Explorer will expire in 2023.

For some of our real estate leases and berthing agreements, we do have the option to extend our current lease term. For those lease agreements with renewal options, the renewal periods for real estate leases range from one to 10 years and the renewal periods for berthing agreements range from one to 20 years. Generally, we do not include renewal options as a component of our present value calculation for berthing agreements. However, for certain real estate leases, we include them.

As most of our leases do not provide an implicit rate, we use our incremental borrowing rate in determining the present value of lease payments. We estimate our incremental borrowing rates based on LIBOR and U.S. Treasury note rates corresponding to lease terms increased by the Company’s credit risk spread and reduced by the estimated impact of collateral. In addition, we have lease agreements with lease and non-lease components, which are generally accounted for separately. However, for berthing agreements, we account for the lease and non-lease components as a single lease component.

Finance Leases

In June 2019, the Company entered into a new master lease agreement (“Master Lease”) with Miami-Dade County related to the buildings and surrounding land located at its Miami headquarters, which has been classified as a finance lease in accordance with ASC 842, Leases. In January of 2022, we executed a modification to the Master Lease to extend the expiration of the lease from 2072 to 2074, which continues to include the two five-year options to extend the lease. We continue to consider the probability of exercising the two five-year options as reasonably certain. The modification of the Master Lease did not change the classification of the lease. The total aggregate amount of the finance lease liabilities recorded for this Master Lease are $100.3 million and $127.0 million as of March 31, 2022 and December 31, 2021, respectively.

Silversea Cruises operates Silver Dawn under a sale-leaseback agreement with a bargain purchase option at the end of the 15-year lease term. Due to the bargain purchase option at the end of the lease term in 2036, whereby Silversea Cruises is reasonably certain of obtaining ownership of the ship, Silver Dawn is accounted for as a finance lease. The lease includes other purchase options beginning in year three, none of which are reasonably certain of being exercised at this time. The total aggregate amount of finance lease liabilities recorded for this ship are $279.0 million and $283.7 million as of March 31, 2022 and December 31, 2021, respectively.

Silversea Cruises operates the Silver Whisper under a finance lease. The finance lease for Silver Whisper will expire in 2023, subject to an option to purchase the ship. Additionally, certain scheduled payments have been deferred and are reflected in Long-term debt in our Consolidated Balance Sheet as of March 31, 2022 and December 31, 2021. The total aggregate amount of the finance lease liabilities recorded for this ship was $16.6 million and $24.1 million at March 31, 2022 and December 31, 2021, respectively. The lease payments on the Silver Whisper are subject to adjustments based on the LIBOR rate.

The carrying amounts of these ships are reported within Property and equipment, net in our Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021.

The components of lease expense were as follows (in thousands):

	Consolidated Statement of Comprehensive Loss Classification	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Lease costs:
Operating lease costs	Commission, transportation and other	$	22,729	$	—
Operating lease costs	Other operating expenses	5,471		5,130
Operating lease costs	Marketing, selling and administrative expenses	4,776		6,035
Financial lease costs:
Amortization of right-of-use-assets	Depreciation and amortization expenses	6,093		3,744
Interest on lease liabilities	Interest expense, net of interest capitalized	4,600		310
Total lease costs		$	43,669	$	15,219

In addition, certain of our berthing agreements include variable lease costs based on the number of passengers berthed. During the quarter ended March 31, 2022, we had $7.5 million variable lease costs recorded within Commission, transportation and other in our consolidated statement of comprehensive loss.

Weighted average of the remaining lease terms and weighted average discount rates are as follows:

	As of March 31, 2022		As of December 31, 2021
Weighted average of the remaining lease term in years
Operating leases	18.04		18.18
Finance leases	22.90		23.96
Weighted average discount rate
Operating leases	6.53	%	6.52	%
Finance leases	5.95	%	5.54	%

Supplemental cash flow information related to leases is as follows (in thousands):

	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	28,193	$	5,531
Operating cash flows from finance leases	$	4,600	$	310
Financing cash flows from finance leases	$	17,034	$	4,305

As of March 31, 2022, maturities related to lease liabilities were as follows (in thousands):

Year	Operating Leases		Finance Leases
Remainder of 2022	$	79,074	$	49,240
2023	108,241		53,069
2024	89,214		44,348
2025	81,594		43,986
2026	75,519		38,843
Thereafter	825,818		704,535
Total lease payments	1,259,460		934,021
Less: Interest	(661,302)		(505,634)
Present value of lease liabilities	$	598,158	$	428,387

Leases

Note 7. Leases

Operating Leases

Our operating leases primarily relate to preferred berthing arrangements, real estate and shipboard equipment, and are included within Operating lease right-of-use assets, and Long-term operating lease liabilities with the current portion of the liability included within Current portion of operating lease liabilities in our consolidated balance sheets as of March 31, 2022 and December 31, 2021. Leases with an initial term of 12 months or less are not recorded on our consolidated balance sheet. We recognize lease expense for these leases on a straight-line basis over the lease term. Our operating leases include Silver Explorer, operated by Silversea Cruises. The operating lease for Silver Explorer will expire in 2023.

For some of our real estate leases and berthing agreements, we do have the option to extend our current lease term. For those lease agreements with renewal options, the renewal periods for real estate leases range from one to 10 years and the renewal periods for berthing agreements range from one to 20 years. Generally, we do not include renewal options as a component of our present value calculation for berthing agreements. However, for certain real estate leases, we include them.

As most of our leases do not provide an implicit rate, we use our incremental borrowing rate in determining the present value of lease payments. We estimate our incremental borrowing rates based on LIBOR and U.S. Treasury note rates corresponding to lease terms increased by the Company’s credit risk spread and reduced by the estimated impact of collateral. In addition, we have lease agreements with lease and non-lease components, which are generally accounted for separately. However, for berthing agreements, we account for the lease and non-lease components as a single lease component.

Finance Leases

In June 2019, the Company entered into a new master lease agreement (“Master Lease”) with Miami-Dade County related to the buildings and surrounding land located at its Miami headquarters, which has been classified as a finance lease in accordance with ASC 842, Leases. In January of 2022, we executed a modification to the Master Lease to extend the expiration of the lease from 2072 to 2074, which continues to include the two five-year options to extend the lease. We continue to consider the probability of exercising the two five-year options as reasonably certain. The modification of the Master Lease did not change the classification of the lease. The total aggregate amount of the finance lease liabilities recorded for this Master Lease are $100.3 million and $127.0 million as of March 31, 2022 and December 31, 2021, respectively.

Silversea Cruises operates Silver Dawn under a sale-leaseback agreement with a bargain purchase option at the end of the 15-year lease term. Due to the bargain purchase option at the end of the lease term in 2036, whereby Silversea Cruises is reasonably certain of obtaining ownership of the ship, Silver Dawn is accounted for as a finance lease. The lease includes other purchase options beginning in year three, none of which are reasonably certain of being exercised at this time. The total aggregate amount of finance lease liabilities recorded for this ship are $279.0 million and $283.7 million as of March 31, 2022 and December 31, 2021, respectively.

Silversea Cruises operates the Silver Whisper under a finance lease. The finance lease for Silver Whisper will expire in 2023, subject to an option to purchase the ship. Additionally, certain scheduled payments have been deferred and are reflected in Long-term debt in our Consolidated Balance Sheet as of March 31, 2022 and December 31, 2021. The total aggregate amount of the finance lease liabilities recorded for this ship was $16.6 million and $24.1 million at March 31, 2022 and December 31, 2021, respectively. The lease payments on the Silver Whisper are subject to adjustments based on the LIBOR rate.

The carrying amounts of these ships are reported within Property and equipment, net in our Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021.

The components of lease expense were as follows (in thousands):

	Consolidated Statement of Comprehensive Loss Classification	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Lease costs:
Operating lease costs	Commission, transportation and other	$	22,729	$	—
Operating lease costs	Other operating expenses	5,471		5,130
Operating lease costs	Marketing, selling and administrative expenses	4,776		6,035
Financial lease costs:
Amortization of right-of-use-assets	Depreciation and amortization expenses	6,093		3,744
Interest on lease liabilities	Interest expense, net of interest capitalized	4,600		310
Total lease costs		$	43,669	$	15,219

In addition, certain of our berthing agreements include variable lease costs based on the number of passengers berthed. During the quarter ended March 31, 2022, we had $7.5 million variable lease costs recorded within Commission, transportation and other in our consolidated statement of comprehensive loss.

Weighted average of the remaining lease terms and weighted average discount rates are as follows:

	As of March 31, 2022		As of December 31, 2021
Weighted average of the remaining lease term in years
Operating leases	18.04		18.18
Finance leases	22.90		23.96
Weighted average discount rate
Operating leases	6.53	%	6.52	%
Finance leases	5.95	%	5.54	%

Supplemental cash flow information related to leases is as follows (in thousands):

	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	28,193	$	5,531
Operating cash flows from finance leases	$	4,600	$	310
Financing cash flows from finance leases	$	17,034	$	4,305

As of March 31, 2022, maturities related to lease liabilities were as follows (in thousands):

Year	Operating Leases		Finance Leases
Remainder of 2022	$	79,074	$	49,240
2023	108,241		53,069
2024	89,214		44,348
2025	81,594		43,986
2026	75,519		38,843
Thereafter	825,818		704,535
Total lease payments	1,259,460		934,021
Less: Interest	(661,302)		(505,634)
Present value of lease liabilities	$	598,158	$	428,387

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 8. Commitments and Contingencies

Ship Purchase Obligations

Our future capital commitments consist primarily of new ship orders. As of March 31, 2022, one Oasis-class ship and three ships of a new generation, known as our Icon-class, are on order for our Royal Caribbean International brand with an aggregate capacity of approximately 22,500 berths. As of March 31, 2022, we had two Edge-class ships on order for our Celebrity Cruises brand with an aggregate capacity of approximately 6,500 berths. Additionally, as of March 31, 2022, we have two ships on order for our Silversea Cruises brand with an aggregate capacity of approximately 1,460 berths.

COVID-19 has impacted shipyard operations which have and may continue to result in delays of our previously contracted ship deliveries. As of March 31, 2022, the dates that the ships on order by our Global and Partner Brands are expected to be delivered, subject to change in the event of construction delays, and their approximate berths are as follows:

Ship	Shipyard	Expected to be delivered	Approximate Berths
Royal Caribbean International —
Oasis-class:
Utopia of the Seas	Chantiers de l'Atlantique	2nd Quarter 2024	5,700
Icon-class:
Icon of the Seas	Meyer Turku Oy	3rd Quarter 2023	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2025	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2026	5,600
Celebrity Cruises —
Edge-class:
Celebrity Beyond	Chantiers de l'Atlantique	2nd Quarter 2022	3,250
Celebrity Ascent	Chantiers de l'Atlantique	4th Quarter 2023	3,250
Silversea Cruises
Evolution Class:
Silver Nova	Meyer Werft	2nd Quarter 2023	730
Unnamed	Meyer Werft	2nd Quarter 2024	730
TUI Cruises (50% joint venture)
Mein Schiff 7	Meyer Turku Oy	2nd Quarter 2024	2,900
Unnamed	Fincantieri	4th Quarter 2024	4,100
Unnamed	Fincantieri	2nd Quarter 2026	4,100
Total Berths			41,560

We took delivery of Celebrity Beyond in April of 2022. In addition, as of March 31, 2022, we have an agreement in place with Chantiers de l'Atlantique to build an additional Edge-class ship for delivery in 2025, which is contingent upon completion of conditions precedent and financing.

As of March 31, 2022, the aggregate cost of our ships on order presented in the table above, excluding any ships on order by our Partner Brands, was approximately $10.7 billion, of which we had deposited $0.6 billion as of such date. Approximately 61.8% of the aggregate cost was exposed to fluctuations in the Euro exchange rate at March 31, 2022. Refer to Note 11. Fair Value Measurements and Derivative Instruments for further information.

Litigation

As previously reported, two lawsuits were filed against us in August 2019 in the U.S. District Court for the Southern District of Florida (the "Court") under Title III of the Cuban Liberty and Democratic Solidarity Act, also known as the Helms-Burton Act. The complaint filed by Havana Docks Corporation ("Havana Docks Action") alleges it holds an interest in the Havana Cruise Port Terminal, and the complaint filed by Javier Garcia-Bengochea (the "Port of Santiago Action") alleges that he holds an interest in the Port of Santiago, Cuba, both of which were expropriated by the Cuban government. The complaints further allege that we trafficked in those properties by embarking and disembarking passengers at these facilities. The plaintiffs seek all available statutory remedies, including the value of the expropriated property, plus interest, treble damages, attorneys’ fees and costs. The Court dismissed the Port of Santiago Action with prejudice on the basis that the plaintiff lacked standing, and the plaintiff’s appeal of the dismissal is awaiting a decision by the appellate court. In the Havana Docks Action, on March 21, 2022, the Court granted summary judgement in favor of the plaintiff as to liability, which we have sought permission from the Court to immediately appeal, and a trial on damages has been scheduled for September 2022. We believe we have meritorious defenses to the claims alleged in both the Havana Docks Action and the Port of Santiago Action, and we intend to vigorously defend ourselves against them. Given that the outcome of the litigation is inherently unpredictable and subject to significant uncertainties, there can be no assurances that the final outcome of either case will not be material, and we cannot reasonably estimate the potential loss or range of loss, if any, associated with the litigation.

We are routinely involved in claims typical within the cruise vacation industry. The majority of these claims are covered by insurance. We believe the outcome of such claims, net of expected insurance recoveries, will not have a material adverse impact on our financial condition or results of operations and cash flows.

Other

Some of the contracts that we enter into include indemnification provisions that obligate us to make payments to the counterparty if certain events occur. These contingencies generally relate to changes in taxes, increased lender capital costs and other similar costs. The indemnification clauses are often standard contractual terms and are entered into in the normal course of business. There are no stated or notional amounts included in the indemnification clauses and we are not able to estimate the maximum potential amount of future payments, if any, under these indemnification clauses. We have not been required to make any payments under such indemnification clauses in the past and, under current circumstances, we do not believe an indemnification in any material amount is probable.

If any person acquires ownership of more than 50% of our common stock or, subject to certain exceptions, during any 24-month period, a majority of our board of directors is no longer comprised of individuals who were members of our board of directors on the first day of such period, we may be obligated to prepay indebtedness outstanding under our credit facilities, which we may be unable to replace on similar terms. Our debt securities also contain change of control provisions that would be triggered by a third-party acquisition of greater than 50% of our common stock coupled with a ratings downgrade. If this were to occur, it would have an adverse impact on our liquidity and operations.

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Shareholders' Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Shareholders' Equity

Note 9. Shareholders' Equity

On January 1, 2022, we adopted ASU 2020-06 using the modified retrospective approach to recognize our convertible notes as single liability instruments. As a result of the adoption of this pronouncement, the cumulative effect to Shareholders' equity was a reduction of $161.4 million. For further information regarding the entry recorded and the adoption of ASU 2020-06, refer to Note 2. Summary of Significant Accounting Policies.

Common Stock Issued

During March 2021, we issued 16.9 million shares of common stock, par value $0.01 per share, at a price of $91.00 per share. We received net proceeds of $1.5 billion from the sale of our common stock, after deducting the estimated offering expenses payable by us.

Dividends

During the second quarter of 2020, we agreed with certain of our lenders not to pay dividends or engage in common stock repurchases for so long as our debt covenant waivers are in effect. In addition, in the event we declare a dividend or engage in share repurchases, we will need to repay the amounts deferred under our export credit facilities. Accordingly, during the three months ended March 31, 2021 and 2022, we did not declare dividends. Pursuant to amendments made to these agreements during the first quarter of 2021, the restrictions on paying cash dividends and effectuating share repurchases were extended through and including the third quarter of 2022.

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Changes in Accumulated Other Comprehensive Loss

3 Months Ended

Mar. 31, 2022

Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]

Changes in Accumulated Other Comprehensive Loss

Note 10. Changes in Accumulated Other Comprehensive Loss

The following table presents the changes in accumulated other comprehensive loss by component for the quarters ended March 31, 2022 and 2021 (in thousands):

	Accumulated Other Comprehensive Loss for the Quarter Ended March 31, 2022								Accumulated Other Comprehensive Loss for the Quarter Ended March 31, 2021
	Changes related to cash flow derivative hedges		Changes in defined benefit plans		Foreign currency translation adjustments		Accumulated  other comprehensive loss		Changes related to cash flow derivative hedges		Changes in defined benefit plans		Foreign currency translation adjustments		Accumulated  other comprehensive loss
Accumulated comprehensive loss at beginning of the year	$	(646,473)	$	(56,835)	$	(7,577)	$	(710,885)	$	(650,519)	$	(65,542)	$	(23,280)	$	(739,341)
Other comprehensive income (loss) before reclassifications	224,619		11,869		7,778		244,266		(927)		9,720		9,722		18,515
Amounts reclassified from accumulated other comprehensive loss	(28,718)		728		—		(27,990)		11,229		743		—		11,972
Net current-period other comprehensive income (loss)	195,901		12,597		7,778		216,276		10,302		10,463		9,722		30,487
Ending balance	$	(450,572)	$	(44,238)	$	201	$	(494,609)	$	(640,217)	$	(55,079)	$	(13,558)	$	(708,854)

The following table presents reclassifications out of accumulated other comprehensive loss for the quarters ended March 31, 2022 and 2021 (in thousands):

	Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
Details About Accumulated Other Comprehensive Loss Components	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021		Affected Line Item in Statements of Comprehensive Loss
Gain (loss) on cash flow derivative hedges:
Interest rate swaps	$	(10,434)	$	(9,509)	Interest expense, net of interest capitalized
Foreign currency forward contracts	(4,065)		(3,781)		Depreciation and amortization expenses
Foreign currency forward contracts	(1,218)		(1,291)		Other income (expense)
Fuel swaps	(369)		(407)		Other income (expense)
Fuel swaps	44,804		3,759		Fuel
	28,718		(11,229)
Amortization of defined benefit plans:
Actuarial loss	(728)		(743)		Payroll and related
	(728)		(743)
Total reclassifications for the period	$	27,990	$	(11,972)

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Fair Value Measurements and Derivative Instruments

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements and Derivative Instruments

Note 11. Fair Value Measurements and Derivative Instruments 

Fair Value Measurements

The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands): 

	Fair Value Measurements at March 31, 2022										Fair Value Measurements at December 31, 2021
Description	Total Carrying Amount		Total Fair Value		Level 1(1)		Level 2(2)		Level 3(3)		Total Carrying Amount		Total Fair Value		Level 1(1)		Level 2(2)		Level 3(3)
Assets:
Cash and cash equivalents(4)	$	1,968,504	$	1,968,504	$	1,968,504	$	—	$	—	$	2,701,770	$	2,701,770	$	2,701,770	$	—	$	—
Total Assets	$	1,968,504	$	1,968,504	$	1,968,504	$	—	$	—	$	2,701,770	$	2,701,770	$	2,701,770	$	—	$	—
Liabilities:
Long-term debt (including current portion of debt)(5)	$	22,073,589	$	23,323,063	$	—	$	23,323,063	$	—	$	20,618,065	$	22,376,480	$	—	$	22,376,480	$	—
Total Liabilities	$	22,073,589	$	23,323,063	$	—	$	23,323,063	$	—	$	20,618,065	$	22,376,480	$	—	$	22,376,480	$	—

(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

(2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company.

(3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of March 31, 2022 and December 31, 2021.

(4) Consists of cash and marketable securities with original maturities of less than 90 days.

(5) Consists of unsecured revolving credit facilities, senior notes, term loans and convertible notes. These amounts do not include our finance lease obligations or commercial paper.

Other Financial Instruments 

The carrying amounts of accounts receivable, accounts payable, accrued interest and accrued expenses approximate fair value at March 31, 2022 and December 31, 2021.

Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands):

	Fair Value Measurements at March 31, 2022								Fair Value Measurements at December 31, 2021
Description	Total		Level 1(1)		Level 2(2)		Level 3(3)		Total		Level 1(1)		Level 2(2)		Level 3(3)
Assets:
Derivative financial instruments(4)	$	241,254	$	—	$	241,254	$	—	$	69,808	$	—	$	69,808	$	—
Total Assets	$	241,254	$	—	$	241,254	$	—	$	69,808	$	—	$	69,808	$	—
Liabilities:
Derivative financial instruments(5)	$	117,708	$	—	$	117,708	$	—	$	200,541	$	—	$	200,541	$	—
Total Liabilities	$	117,708	$	—	$	117,708	$	—	$	200,541	$	—	$	200,541	$	—

(1)Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

(2)Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company.

(3)Inputs that are unobservable. No Level 3 inputs were used in fair value measurements of Other financial instruments as of March 31, 2022 and December 31, 2021.

(4)Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

(5) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

The reported fair values are based on a variety of factors and assumptions. Accordingly, the fair values may not represent actual values of the financial instruments that could have been realized as of March 31, 2022 or December 31, 2021, or that will be realized in the future, and do not include expenses that could be incurred in an actual sale or settlement.

Nonfinancial Instruments Recorded at Fair Value on a Nonrecurring Basis

Nonfinancial instruments include items such as goodwill, indefinite-lived intangible assets, long-lived assets, right-of-use assets and equity method investments that are measured at fair value on a nonrecurring basis when events and circumstances indicate the carrying value is not recoverable. The following table presents information about the Company’s nonfinancial instruments recorded at fair value on a nonrecurring basis (in thousands):

	Fair Value Measurements at December 31, 2021
Description	Total Carrying Amount	Total Fair Value	Level 3	Total Impairment for the Year Ended December 31, 2021 (1)
Long-lived assets	—	—	—	55,213
Total	—	—	—	55,213

(1) Amount is primarily composed of construction in progress assets that were impaired during the year ended 2021 due to a reduction in scope or the decision to not complete the projects. The impairments were calculated based on orderly liquidation values. The fair value of these assets was estimated as of the date the assets were last impaired.

There were no nonfinancial instruments recorded at fair value as of March 31, 2022.

Master Netting Agreements

We have master International Swaps and Derivatives Association (“ISDA”) agreements in place with our derivative instrument counterparties. These ISDA agreements generally provide for final close out netting with our counterparties for all positions in the case of default or termination of the ISDA agreement. We have determined that our ISDA agreements provide us with rights of setoff on the fair value of derivative instruments in a gain position and those in a loss position with the same counterparty. We have elected not to offset such derivative instrument fair values in our consolidated balance sheets.

See Credit Related Contingent Features for further discussion on contingent collateral requirements for our derivative instruments.

The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands):

	Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
	As of March 31, 2022								As of December 31, 2021
	Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Liabilities		Cash Collateral Received		Net Amount of Derivative Assets		Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Liabilities		Cash Collateral Received		Net Amount of Derivative Assets
Derivatives subject to master netting agreements	$	241,254	$	(68,784)	$	—	$	172,470	$	69,808	$	(67,995)	$	—	$	1,813
Total	$	241,254	$	(68,784)	$	—	$	172,470	$	69,808	$	(67,995)	$	—	$	1,813

The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands):

	Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
	As of March 31, 2022								As of December 31, 2021
	Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Assets		Cash Collateral Pledged		Net Amount of Derivative Liabilities		Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Assets		Cash Collateral Pledged		Net Amount of Derivative Liabilities
Derivatives subject to master netting agreements	$	(117,708)	$	68,784	$	16,668	$	(32,256)	$	(200,541)	$	67,995	$	44,411	$	(88,135)
Total	$	(117,708)	$	68,784	$	16,668	$	(32,256)	$	(200,541)	$	67,995	$	44,411	$	(88,135)

Concentrations of Credit Risk

We monitor our credit risk associated with financial and other institutions with which we conduct significant business, and to minimize these risks, we select counterparties with credit risks acceptable to us and we seek to limit our exposure to an individual counterparty. Credit risk, including, but not limited to, counterparty nonperformance under derivative instruments, our credit facilities and new ship progress payment guarantees, is not considered significant, as we primarily conduct business with large, well-established financial institutions, insurance companies and export credit agencies many of which we have long-term relationships with and which have credit risks acceptable to us or where the credit risk is spread out among a large number of counterparties. As of March 31, 2022, we had counterparty credit risk exposure under our derivative instruments of $157.7 million, which was limited to the cost of replacing the contracts in the event of non-performance by the counterparties to the contracts, the majority of which are currently our lending banks. We do not anticipate nonperformance by any of our significant counterparties. In addition, we have established guidelines we follow regarding credit ratings and instrument maturities to maintain safety and liquidity. We do not normally require collateral or other security to support credit relationships; however, in certain circumstances this option is available to us.

Derivative Instruments

We are exposed to market risk attributable to changes in interest rates, foreign currency exchange rates and fuel prices. We try to mitigate these risks through a combination of our normal operating and financing activities and through the use of derivative financial instruments pursuant to our hedging practices and policies. The financial impact of these hedging instruments is primarily offset by corresponding changes in the underlying exposures being hedged. We achieve this by closely matching the notional amount, term and conditions of the derivative instrument with the underlying risk being hedged. Although certain of our derivative financial instruments do not qualify or are not accounted for under hedge accounting, our objective is not to hold or issue derivative financial instruments for trading or other speculative purposes. 

We enter into various forward, swap and option contracts to manage our interest rate exposure and to limit our exposure to fluctuations in foreign currency exchange rates and fuel prices. These instruments are recorded on the balance sheet at their fair value and

the vast majority are designated as hedges. We also use non-derivative financial instruments designated as hedges of our net investment in our foreign operations and investments.

At inception of the hedge relationship, a derivative instrument that hedges the exposure to changes in the fair value of a firm commitment or a recognized asset or liability is designated as a fair value hedge. A derivative instrument that hedges a forecasted transaction or the variability of cash flows related to a recognized asset or liability is designated as a cash flow hedge.

Changes in the fair value of derivatives that are designated as fair value hedges are offset against changes in the fair value of the underlying hedged assets, liabilities or firm commitments. Gains and losses on derivatives that are designated as cash flow hedges are recorded as a component of Accumulated other comprehensive loss until the underlying hedged transactions are recognized in earnings. The foreign currency transaction gain or loss of our non-derivative financial instruments and the changes in the fair value of derivatives designated as hedges of our net investment in foreign operations and investments are recognized as a component of Accumulated other comprehensive loss along with the associated foreign currency translation adjustment of the foreign operation or investment. In certain hedges of our net investment in foreign operations and investments, we exclude forward points from the assessment of hedge effectiveness and we amortize the related amounts directly into earnings.

On an ongoing basis, we assess whether derivatives used in hedging transactions are "highly effective" in offsetting changes in the fair value or cash flow of hedged items. For our net investment hedges, we use the dollar offset method to measure effectiveness. For all other hedging programs, we use the long-haul method to assess hedge effectiveness using regression analysis for each hedge relationship. The methodology for assessing hedge effectiveness is applied on a consistent basis for each one of our hedging programs (i.e., interest rate, foreign currency ship construction, foreign currency net investment and fuel). For our regression analyses, we use an observation period of up to three years, utilizing market data relevant to the hedge horizon of each hedge relationship. High effectiveness is achieved when a statistically valid relationship reflects a high degree of offset and correlation between the changes in the fair values of the derivative instrument and the hedged item. If it is determined that a derivative is not highly effective as a hedge or hedge accounting is discontinued, any change in fair value of the derivative since the last date at which it was determined to be effective is recognized in earnings.

Cash flows from derivative instruments that are designated as fair value or cash flow hedges are classified in the same category as the cash flows from the underlying hedged items. In the event that hedge accounting is discontinued, cash flows subsequent to the date of discontinuance are classified within investing activities. Cash flows from derivative instruments not designated as hedging instruments are classified as investing activities. 

We consider the classification of the underlying hedged item’s cash flows in determining the classification for the designated derivative instrument’s cash flows. We classify derivative instrument cash flows from hedges of benchmark interest rate or hedges of fuel expense as operating activities due to the nature of the hedged item. Likewise, we classify derivative instrument cash flows from hedges of foreign currency risk on our newbuild ship payments as investing activities.

Interest Rate Risk

Our exposure to market risk for changes in interest rates primarily relates to our debt obligations, including future interest payments. At March 31, 2022 and December 31, 2021, approximately 71.6% and 65.7%, respectively, of our debt was effectively fixed-rate debt. We use interest rate swap agreements to modify our exposure to interest rate movements and to manage our interest expense.

Market risk associated with our fixed-rate debt is the potential increase in fair value resulting from a decrease in interest rates. We use interest rate swap agreements that effectively convert a portion of our fixed-rate debt to a floating-rate basis to manage this risk. At March 31, 2022 and December 31, 2021, we maintained interest rate swap agreements on the following fixed-rate debt instruments:

Debt Instrument	Swap Notional as of March 31, 2022 (in thousands)		Maturity	Debt Fixed Rate	Swap Floating Rate: LIBOR plus	All-in Swap Floating Rate as of March 31, 2022
Unsecured senior notes	650,000		November 2022	5.25%	3.63%	4.14%
	$	650,000

These interest rate swap agreements are accounted for as fair value hedges.

Market risk associated with our long-term floating-rate debt is the potential increase in interest expense from an increase in interest rates. We use interest rate swap agreements that effectively convert a portion of our floating-rate debt to a fixed-rate basis to manage this risk. At March 31, 2022 and December 31, 2021, we maintained interest rate swap agreements on the following floating-rate debt instruments:

Debt Instrument	Swap Notional as of March 31, 2022 (in thousands)		Maturity	Debt Floating Rate		All-in Swap Fixed Rate
Celebrity Reflection term loan	$	163,625	October 2024	LIBOR plus	0.40%	2.85%
Quantum of the Seas term loan	306,250		October 2026	LIBOR plus	1.30%	3.74%
Anthem of the Seas term loan	332,292		April 2027	LIBOR plus	1.30%	3.86%
Ovation of the Seas term loan	449,583		April 2028	LIBOR plus	1.00%	3.16%
Harmony of the Seas term loan (1)	417,714		May 2028	EURIBOR plus	1.15%	2.26%
Odyssey of the Seas term loan (2)	421,667		October 2032	LIBOR plus	0.96%	3.21%
Odyssey of the Seas term loan (2)	191,667		October 2032	LIBOR plus	0.96%	2.84%
	$	2,282,798

(1)Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of March 31, 2022.

(2)Interest rate swap agreements hedging the term loan of Odyssey of the Seas include LIBOR zero-floors matching the debt LIBOR zero-floor. The effective dates of the $421.7 million and $191.7 million interest rate swap agreements are October 2020 and October 2022, respectively. The unsecured term loan for the financing of Odyssey of the Seas was drawn on March 2021.

These interest rate swap agreements are accounted for as cash flow hedges.

The notional amount of interest rate swap agreements related to outstanding debt as of March 31, 2022 and December 31, 2021 was $2.9 billion.

Foreign Currency Exchange Rate Risk

Derivative Instruments

Our primary exposure to foreign currency exchange rate risk relates to our ship construction contracts denominated in Euros, our foreign currency denominated debt and our international business operations. We enter into foreign currency forward contracts to manage portions of the exposure to movements in foreign currency exchange rates. As of March 31, 2022, the aggregate cost of our ships on order was $10.7 billion, of which we had deposited $618.5 million as of such date. These amounts do not include any ships placed on order that are contingent upon completion of conditions precedent and/or financing and any ships on order by our Partner Brands. Refer to Note 8. Commitments and Contingencies, for further information on our ships on order. At March 31, 2022 and December 31, 2021, approximately 61.8% and 59.0%, respectively, of the aggregate cost of the ships under construction was exposed to fluctuations in the Euro exchange rate. Our foreign currency forward contract agreements are accounted for as cash flow or net investment hedges depending on the designation of the related hedge.

On a regular basis, we enter into foreign currency forward contracts and, from time to time, we utilize cross-currency swap agreements and collar options to minimize the volatility resulting from the remeasurement of net monetary assets and liabilities denominated in a currency other than our functional currency or the functional currencies of our foreign subsidiaries. During the first quarter of 2022, we maintained an average of approximately $0.8 billion of these foreign currency forward contracts. These instruments are not designated as hedging instruments. For the quarters ended March 31, 2022 and 2021, changes in the fair value of the foreign currency forward contracts resulted in losses of $7.0 million and $13.5 million, respectively, which offset gains arising from the remeasurement of monetary assets and liabilities denominated in foreign currencies in those same periods of $7.2 million and $4.4 million, respectively. These amounts were recognized in earnings within Other income (expense) in our consolidated statements of comprehensive loss.

We consider our investments in our foreign operations to be denominated in relatively stable currencies and to be of a long-term nature. As of March 31, 2022, we maintained a foreign currency forward contract and designated it as a hedge of a portion of our net investments in TUI Cruises of €245.0 million, or approximately $272.5 million based on the exchange rate at March 31, 2022. This forward currency contract matured in April 2022.

The notional amount of outstanding foreign exchange contracts, excluding the forward contracts entered into to minimize remeasurement volatility, as of March 31, 2022 and December 31, 2021 was $2.8 billion and $3.4 billion, respectively.

Non-Derivative Instruments

We also address the exposure of our investments in foreign operations by denominating a portion of our debt in our subsidiaries’ and investments’ functional currencies and designating it as a hedge of these subsidiaries and investments. We had designated debt as a hedge of our net investments primarily in TUI Cruises of €99.0 million, or approximately $110.1 million, as of March 31, 2022. As of

December 31, 2021, we had designated debt as a hedge of our net investments in TUI Cruises of €97.0 million, or approximately $110.3 million.

Fuel Price Risk

Our exposure to market risk for changes in fuel prices relates primarily to the consumption of fuel on our ships. We use fuel swap agreements to mitigate the financial impact of fluctuations in fuel prices.

Our fuel swap agreements are generally accounted for as cash flow hedges. In the case that our hedged forecasted fuel consumption is not probable of occurring, hedge accounting will be discontinued and the related accumulated other comprehensive gain or loss will be reclassified to Other income (expense) immediately. For hedged forecasted fuel consumption that remains possible of occurring, hedge accounting will be discontinued and the related accumulated other comprehensive gain or loss will remain in accumulated other comprehensive gain or loss until the underlying hedged transactions are recognized in earnings or the related hedged forecasted fuel consumption is deemed probable of not occurring.

Prior suspension of our cruise operations due to the COVID-19 pandemic and our gradual resumption of cruise operations has resulted in reductions to our forecasted fuel purchases. During the quarter ended March 31, 2021, we discontinued cash flow hedge accounting on 48 thousand metric tons of our fuel swap agreements maturing in 2021, which resulted in the reclassification of a net $4.4 million loss from Accumulated other comprehensive loss to Other income (expense). For the quarter ended March 31, 2022, we did not discontinue cash flow hedge accounting on any of our fuel swap agreements. Changes in the fair value of fuel swaps for which cash flow hedge accounting was discontinued are currently recognized in Other income (expense) each reporting period through the maturity dates of the fuel swaps.

Future suspension of our operations or modifications to our itineraries may affect our expected forecasted fuel purchases which could result in further discontinuance of fuel swap cash flow hedge accounting and the reclassification of deferred gains or losses from Accumulated other comprehensive loss into earnings. Refer to Risk Factors in Part II, Item 1A. for further discussion on risks related to COVID-19.

At March 31, 2022, we have hedged the variability in future cash flows for certain forecasted fuel transactions occurring through 2023. As of March 31, 2022 and December 31, 2021, we had the following outstanding fuel swap agreements:

	Fuel Swap Agreements
	As of March 31, 2022	As of December 31, 2021
Designated as hedges:	(metric tons)
2022	660,650	821,850
2023	249,050	249,050

	Fuel Swap Agreements
	As of March 31, 2022		As of December 31, 2021
	(% hedged)
Designated hedges as a % of projected fuel purchases:
2022	55	%	54	%
2023	15	%	15	%

	Fuel Swap Agreements
	As of March 31, 2021	As of December 31, 2021
Not designated as hedges:	(metric tons)
2022(1)	139,100	231,900
2023	—	—

(1)    As of March 31, 2022, 69,550 metric tons relate to fuel swap agreements with discontinued hedge accounting, in which we effectively pay fixed prices and receive floating prices from the counterparty. The remaining 69,550 tons relate to fuel swap agreements that were not designated as hedges since inception, in which we effectively pay floating prices and receive fixed prices from the counterparty.

As of March 31, 2022, there was $145.6 million of estimated unrealized gain associated with our cash flow hedges pertaining to fuel swap agreements is expected to be reclassified to earnings from Accumulated other comprehensive loss within the next twelve months when compared to $23.8 million of estimated unrealized net gain at December 31, 2021. Reclassification is expected to occur as the result of fuel consumption associated with our hedged forecasted fuel purchases.

The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands):

	Fair Value of Derivative Instruments
	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	As of March 31, 2022		As of December 31, 2021		Balance Sheet Location	As of March 31, 2022		As of December 31, 2021
		Fair Value		Fair Value			Fair Value		Fair Value
Derivatives designated as hedging instruments under ASC 815-20(1)
Interest rate swaps	Other assets	$	23,791	$	—	Other long-term liabilities	$	1,072	$	62,080
Interest rate-swaps	Derivative financial instruments	741		6,478		Derivative financial instruments	—		—
Foreign currency forward contracts	Derivative financial instruments	15,133		7,357		Derivative financial instruments	84,872		116,027
Foreign currency forward contracts	Other assets	3,932		2,070		Other long-term liabilities	15,082		8,813
Fuel swaps	Derivative financial instruments	145,456		31,919		Derivative financial instruments	—		7,944
Fuel swaps	Other assets	35,370		13,452		Other long-term liabilities	—		1,202
Total derivatives designated as hedging instruments under 815-20		$	224,423	$	61,276		$	101,026	$	196,066
Derivatives not designated as hedging instruments under ASC 815-20
Foreign currency forward contracts	Derivative financial instruments	$	—	$	—	Derivative financial instruments	$	—	$	—
Foreign currency forward contracts	Other assets	—		—		Other long-term liabilities	—		—
Fuel swaps	Derivative financial instruments	16,831		8,430		Derivative financial instruments	16,682		3,264
Fuel swaps	Other Assets	—		102		Other long-term liabilities	—		1,211
Total derivatives not designated as hedging instruments under 815-20		16,831		8,532			16,682		4,475
Total derivatives		$	241,254	$	69,808		$	117,708	$	200,541

(1)Accounting Standard Codification 815-20 “Derivatives and Hedging.”

The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands):

		Carrying Value
Non-derivative instrument designated as hedging instrument under ASC 815-20	Balance Sheet Location	As of March 31, 2022		As of December 31, 2021
Foreign currency debt	Current portion of debt	$	64,938	$	75,518
Foreign currency debt	Long-term debt	45,165		34,795
		$	110,103	$	110,313

The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive loss was as follows (in thousands):

Derivatives and Related Hedged Items under ASC 815-20 Fair Value Hedging Relationships	Location of Gain (Loss) Recognized in Income on Derivative and Hedged Item	Amount of Gain (Loss) Recognized in Income on Derivative				Amount of Gain (Loss) Recognized in Income on Hedged Item
		Quarter Ended March 31, 2022		Quarter Ended March 31, 2021		Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Interest rate swaps	Interest expense (income), net of interest capitalized	$	(3,365)	$	(552)	$	6,024	$	2,930
		$	(3,365)	$	(552)	$	6,024	$	2,930

The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands):

Line Item in the Statement of Financial Position Where the Hedged Item is Included	Carrying Amount of the Hedged Liabilities				Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities
	As of March 31, 2022		As of December 31, 2021		As of March 31, 2022		As of December 31, 2021
Current portion of debt and Long-term debt	$	649,755	$	655,502	$	404	$	6,428
	$	649,755	$	655,502	$	404	$	6,428

The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands):

Derivatives under ASC 815-20 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives
	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Interest rate swaps	$	74,865	$	43,408
Foreign currency forward contracts	(40,062)		(99,581)
Fuel swaps	189,816		55,246
	$	224,619	$	(927)

The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands):

Gain (Loss) Recognized in Income (Net Investment Excluded Components)	Three Months Ended March 31, 2022
Net inception fair value at January 1, 2022	$	(554)
Amount of gain recognized in income on derivatives for the period ended March 31, 2022	577
Amount of gain (loss) remaining to be amortized in accumulated other comprehensive loss, as of March 31, 2022	(39)
Fair value at March 31, 2022	$	(16)

The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands):

	Amount of Gain (Loss) Recognized in Other Comprehensive Loss
Non-derivative instruments under ASC 815-20 Net Investment Hedging Relationships	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Foreign Currency Debt	$	2,745	$	5,822
	$	2,745	$	5,822

There was no amount recognized in income (ineffective portion and amount excluded from effectiveness testing) for the quarters ended March 31, 2022 and March 31, 2021.

The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands):

		Amount of Gain (Loss) Recognized in Income on Derivatives
Derivatives Not Designated as Hedging Instruments under ASC 815-20	Location of Gain (Loss) Recognized in Income on Derivatives	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Foreign currency forward contracts	Other income (expense)	$	(6,985)	$	(13,498)
Fuel swaps	Other income (expense)	(7)		12,655
		$	(6,992)	$	(843)

Credit Related Contingent Features

Our current interest rate derivative instruments require us to post collateral if our Standard & Poor’s and Moody’s credit ratings fall below specified levels. Specifically, under most of our agreements, if on the fifth anniversary of executing a derivative instrument, or on any succeeding fifth-year anniversary, our credit ratings for our senior unsecured debt is rated below BBB- by Standard & Poor’s and Baa3 by Moody’s, then the counterparty will periodically have the right to demand that we post collateral in an amount equal to the difference between (i) the net market value of all derivative transactions with such counterparty that have reached their fifth year anniversary, to the extent negative, and (ii) the applicable minimum call amount.

The amount of collateral required to be posted will change as, and to the extent, our net liability position increases or decreases by more than the applicable minimum call amount. If our credit rating for our senior unsecured debt is subsequently equal to or above BBB- by Standard & Poor’s or Baa3 by Moody’s, then any collateral posted at such time will be released to us and we will no longer be required to post collateral unless we meet the collateral trigger requirement, generally, at the next fifth-year anniversary.

As of March 31, 2022, our senior unsecured debt credit rating was B by Standard & Poor's and B2 by Moody's. As of March 31, 2022, six of our interest rate derivative hedges had a term of at least five years requiring us to post collateral of $16.7 million to satisfy our obligations under our interest rate derivative agreements, taking into account collateral waivers issued by certain banks. We expect that we will not need to provide additional collateral under these agreements in the next twelve months.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Basis for Preparation of Consolidated Financial Statements

Basis for Preparation of Consolidated Financial Statements

The unaudited consolidated financial statements are presented pursuant to the rules and regulations of the Securities and Exchange Commission. In our opinion, these statements include all adjustments necessary for a fair statement of the results of the interim periods reported herein. Adjustments consist only of normal recurring items, except for any items discussed in the notes below. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been condensed or omitted as permitted by such Securities and Exchange Commission rules and regulations. Estimates are required for the preparation of financial statements in accordance with these principles. Actual results could differ from these estimates. Refer to Note 2. Summary of Significant Accounting Policies in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2021 for a discussion of our significant accounting policies.

Basis of Consolidation

All significant intercompany accounts and transactions are eliminated in consolidation. We consolidate entities over which we have control, usually evidenced by a direct ownership interest of greater than 50%, and variable interest entities where we are determined to be the primary beneficiary. Refer to Note 5. Other Assets for further information regarding our variable interest entities. For affiliates we do not control but over which we have significant influence on financial and operating policies, usually evidenced by a direct ownership interest from 20% to 50%, the investment is accounted for using the equity method.

Adoption of Accounting Pronouncements; Recent Accounting Pronouncements

Adoption of Accounting Pronouncements

In August 2020, the FASB issued ASU No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40) ("ASU 2020-06"), which simplifies the accounting for convertible instruments. The guidance removes certain accounting models which separate the embedded conversion features from the host contract for convertible instruments, requiring bifurcation only if the convertible debt feature qualifies as a derivative under ASC 815 or for convertible debt issued at a substantial premium. The ASU removes certain settlement conditions required for equity contracts to qualify for the derivative scope exception, permitting more contracts to qualify for it. In addition, the guidance eliminates the treasury stock method to calculate diluted earnings per share for convertible instruments and requires the use of the if-converted method. The guidance also decreases interest expense due to the reversal of the remaining non-cash convertible debt discount. On January 1, 2022, we adopted this pronouncement using the modified retrospective approach to recognize our convertible notes as single liability instruments given they do not qualify as derivatives under ASC 815, nor were they issued at a substantial premium. Accordingly, as of January 1, 2022, we recorded a $161.4 million increase to debt, primarily as a result of the reversal of the remaining non-cash convertible debt discount, as well as a reduction of $307.6 million to additional paid in capital, which resulted in a cumulative effect on adoption of approximately $146.2 million to increase retained earnings.

Recent Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB") issued Accounting Standard Update (“ASU") No. 2020-04, Reference Rate Reform (Topic 848), which provides optional expedients and exceptions to the current guidance on contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. Subsequently, in January 2021, the FASB issued ASU No. 2021-01, Reference Rate Reform (Topic 848), which presents amendments to clarify that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The guidance in both ASUs was effective upon issuance and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. We are currently evaluating the impact of the new guidance on our consolidated financial statements. The impact, if any, will be dependent on the terms of any future contract modifications related to a change in reference rate.

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Revenues (Tables)

3 Months Ended

Mar. 31, 2022

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The following table disaggregates our total revenues by geographic regions where we provide cruise itineraries (in thousands):

	Quarter Ended March 31,
	2022		2021
Revenues by itinerary
North America (1)	$	889,087	$	—
Asia/Pacific	34,633		29,885
Europe	1,425		—
Other regions(2)	79,633		810
Total revenues by itinerary	1,004,778		30,695
Other revenues(3)	54,453		11,319
Total revenues	$	1,059,231	$	42,014

(1)Includes the United States, Canada, Mexico and the Caribbean.

(2) Includes seasonality impacted itineraries primarily in South and Latin American countries.

(3) Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 5. Other Assets for more information on our unconsolidated affiliates.

Passenger ticket revenues are attributed to geographic areas based on where the reservation originates. For the quarters ended March 31, 2022 and 2021, our guests were sourced from the following areas:

	Quarter Ended March 31,
	2022		2021
Passenger ticket revenues:
United States	84	%	—	%
Singapore	4	%	69	%
China	—	%	31	%
All other countries (1)	12	%	—	%

(1)No other individual country's revenue exceeded 10% for the quarters ended March 31, 2022 and 2021.

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(Loss) Per Share (Tables)

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Reconciliation Between Basic and Diluted Earnings Per Share

Basic and diluted (loss) per share is as follows (in thousands, except per share data):

	Quarter Ended March 31,
	2022		2021
Net (Loss) for basic and diluted loss per share	$	(1,167,142)	$	(1,131,722)
Weighted-average common shares outstanding	254,821		243,004
Diluted weighted-average shares outstanding	254,821		243,004
Basic (loss) per share	$	(4.58)	$	(4.66)
Diluted (loss) per share	$	(4.58)	$	(4.66)

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Other Assets (Tables)

3 Months Ended

Mar. 31, 2022

Other Assets [Abstract]

Schedule of Other Nonoperating Income (Expense)

The following tables set forth information regarding our investments accounted for under the equity method of accounting, including the entities discussed above (in thousands):

	Quarter Ended March 31,
	2022		2021
Share of equity (loss) income from investments	$	(31,059)	$	(59,871)
Dividends received (1)	$	423	$	—

(1) Represents dividends received from our investments accounted for under the equity method of accounting for the quarters ended March 31, 2022 and March 31, 2021.

Schedule of Related Party Transactions

	As of March 31, 2022		As of December 31, 2021
Total notes receivable due from equity investments	$	123,157	$	130,587
Less-current portion (1)	21,069		21,508
Long-term portion (2)	$	102,088	$	109,079

(1)Included within Trade and other receivables, net in our consolidated balance sheets.

(2)Included within Other assets in our consolidated balance sheets.

We also provide ship management services to TUIC and recorded the following as it relates to these services in our operating results within our consolidated statements of comprehensive income (loss) (in thousands):

	Quarter Ended March 31,
	2022		2021
Revenues	$	6,372	$	5,231
Expenses	$	1,826	$	1,275

Summary of Credit Loss Allowance

The following table summarizes our credit loss allowance related to receivables for the three months ended March 31, 2022 (in thousands):

	Credit Loss Allowance
Beginning balance January 1, 2022	$	100,192
Loss provision for receivables	653
Write-offs	(8,152)
Ending balance March 31, 2022	$	92,693

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Debt (Tables)

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Schedule of Long-term Debt Instruments

Debt consist of the following (in thousands):

	Interest Rate (1)	Maturities Through	As of March 31, 2022		As of December 31, 2021
Fixed rate debt:
Unsecured senior notes	3.70% to 9.13%	2022 - 2028	$	6,598,558	$	5,604,498
Secured senior notes	10.88% to 11.50%	2023 - 2025	2,357,803		2,354,037
Unsecured term loans	2.53% to 5.89%	2028 - 2034	4,114,508		2,860,567
Convertible notes	2.88% to 4.25%	2023	1,725,000		1,558,780
Total fixed rate debt			14,795,869		12,377,882
Variable rate debt:
Unsecured revolving credit facilities (2)	1.75% to 2.15%	2022 - 2024	1,909,342		2,899,342
USD unsecured term loan	1.84% to 4.95%	2022 - 2033	5,114,768		5,018,740
Euro unsecured term loan	1.15% to 2.25%	2022 - 2028	670,500		685,633
Total variable rate debt			7,694,610		8,603,715
Finance lease liabilities			428,387		472,275
Total debt (3)			22,918,866		21,453,872
Less: unamortized debt issuance costs			(416,890)		(363,532)
Total debt, net of unamortized debt issuance costs			22,501,976		21,090,340
Less—current portion			(2,558,463)		(2,243,131)
Long-term portion			$	19,943,513	$	18,847,209

(1) Interest rates based on outstanding loan balance as of March 31, 2022 and, for variable rate debt, include either LIBOR or EURIBOR plus the applicable margin.

(2) Includes $1.9 billion facility and $1.3 billion facility, the vast majority of which is due in 2024. Our $1.9 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.30%, which interest was 1.75% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.20%. Our $1.3 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.70%, which interest was 2.15% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.30%.

(3) At March 31, 2022 and December 31, 2021, the weighted average interest rate for total debt was 5.61% and 5.47%, respectively.

Schedule of Maturities of Long-term Debt

The following is a schedule of annual maturities on our total debt, net of debt issuance costs and including finance leases, as of March 31, 2022 for each of the next five years (in thousands):

Year
Remainder of 2022	2,273,401
2023	5,665,482
2024	3,128,924
2025	2,417,492
2026	2,614,571
Thereafter	6,402,106
	22,501,976

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Leases (Tables)

3 Months Ended

Mar. 31, 2022

Leases [Abstract]

Schedule of Lease Expense and Cash Flow Information

The components of lease expense were as follows (in thousands):

	Consolidated Statement of Comprehensive Loss Classification	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Lease costs:
Operating lease costs	Commission, transportation and other	$	22,729	$	—
Operating lease costs	Other operating expenses	5,471		5,130
Operating lease costs	Marketing, selling and administrative expenses	4,776		6,035
Financial lease costs:
Amortization of right-of-use-assets	Depreciation and amortization expenses	6,093		3,744
Interest on lease liabilities	Interest expense, net of interest capitalized	4,600		310
Total lease costs		$	43,669	$	15,219

Weighted average of the remaining lease terms and weighted average discount rates are as follows:

	As of March 31, 2022		As of December 31, 2021
Weighted average of the remaining lease term in years
Operating leases	18.04		18.18
Finance leases	22.90		23.96
Weighted average discount rate
Operating leases	6.53	%	6.52	%
Finance leases	5.95	%	5.54	%

Supplemental cash flow information related to leases is as follows (in thousands):

	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	28,193	$	5,531
Operating cash flows from finance leases	$	4,600	$	310
Financing cash flows from finance leases	$	17,034	$	4,305

Schedule of Maturities, Operating Leases

As of March 31, 2022, maturities related to lease liabilities were as follows (in thousands):

Year	Operating Leases		Finance Leases
Remainder of 2022	$	79,074	$	49,240
2023	108,241		53,069
2024	89,214		44,348
2025	81,594		43,986
2026	75,519		38,843
Thereafter	825,818		704,535
Total lease payments	1,259,460		934,021
Less: Interest	(661,302)		(505,634)
Present value of lease liabilities	$	598,158	$	428,387

Schedule of Maturities, Finance Leases

As of March 31, 2022, maturities related to lease liabilities were as follows (in thousands):

Year	Operating Leases		Finance Leases
Remainder of 2022	$	79,074	$	49,240
2023	108,241		53,069
2024	89,214		44,348
2025	81,594		43,986
2026	75,519		38,843
Thereafter	825,818		704,535
Total lease payments	1,259,460		934,021
Less: Interest	(661,302)		(505,634)
Present value of lease liabilities	$	598,158	$	428,387

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Commitment and Contingencies (Tables)

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Summary of Capital Commitments

As of March 31, 2022, the dates that the ships on order by our Global and Partner Brands are expected to be delivered, subject to change in the event of construction delays, and their approximate berths are as follows:

Ship	Shipyard	Expected to be delivered	Approximate Berths
Royal Caribbean International —
Oasis-class:
Utopia of the Seas	Chantiers de l'Atlantique	2nd Quarter 2024	5,700
Icon-class:
Icon of the Seas	Meyer Turku Oy	3rd Quarter 2023	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2025	5,600
Unnamed	Meyer Turku Oy	2nd Quarter 2026	5,600
Celebrity Cruises —
Edge-class:
Celebrity Beyond	Chantiers de l'Atlantique	2nd Quarter 2022	3,250
Celebrity Ascent	Chantiers de l'Atlantique	4th Quarter 2023	3,250
Silversea Cruises
Evolution Class:
Silver Nova	Meyer Werft	2nd Quarter 2023	730
Unnamed	Meyer Werft	2nd Quarter 2024	730
TUI Cruises (50% joint venture)
Mein Schiff 7	Meyer Turku Oy	2nd Quarter 2024	2,900
Unnamed	Fincantieri	4th Quarter 2024	4,100
Unnamed	Fincantieri	2nd Quarter 2026	4,100
Total Berths			41,560

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Changes in Accumulated Other Comprehensive Loss (Tables)

3 Months Ended

Mar. 31, 2022

Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]

Schedule of Changes In Accumulated Other Comprehensive Income (Loss) by Component

The following table presents the changes in accumulated other comprehensive loss by component for the quarters ended March 31, 2022 and 2021 (in thousands):

	Accumulated Other Comprehensive Loss for the Quarter Ended March 31, 2022								Accumulated Other Comprehensive Loss for the Quarter Ended March 31, 2021
	Changes related to cash flow derivative hedges		Changes in defined benefit plans		Foreign currency translation adjustments		Accumulated  other comprehensive loss		Changes related to cash flow derivative hedges		Changes in defined benefit plans		Foreign currency translation adjustments		Accumulated  other comprehensive loss
Accumulated comprehensive loss at beginning of the year	$	(646,473)	$	(56,835)	$	(7,577)	$	(710,885)	$	(650,519)	$	(65,542)	$	(23,280)	$	(739,341)
Other comprehensive income (loss) before reclassifications	224,619		11,869		7,778		244,266		(927)		9,720		9,722		18,515
Amounts reclassified from accumulated other comprehensive loss	(28,718)		728		—		(27,990)		11,229		743		—		11,972
Net current-period other comprehensive income (loss)	195,901		12,597		7,778		216,276		10,302		10,463		9,722		30,487
Ending balance	$	(450,572)	$	(44,238)	$	201	$	(494,609)	$	(640,217)	$	(55,079)	$	(13,558)	$	(708,854)

Schedule of Reclassifications Out of Accumulated Other Comprehensive Income (Loss)

The following table presents reclassifications out of accumulated other comprehensive loss for the quarters ended March 31, 2022 and 2021 (in thousands):

	Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Loss into Income
Details About Accumulated Other Comprehensive Loss Components	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021		Affected Line Item in Statements of Comprehensive Loss
Gain (loss) on cash flow derivative hedges:
Interest rate swaps	$	(10,434)	$	(9,509)	Interest expense, net of interest capitalized
Foreign currency forward contracts	(4,065)		(3,781)		Depreciation and amortization expenses
Foreign currency forward contracts	(1,218)		(1,291)		Other income (expense)
Fuel swaps	(369)		(407)		Other income (expense)
Fuel swaps	44,804		3,759		Fuel
	28,718		(11,229)
Amortization of defined benefit plans:
Actuarial loss	(728)		(743)		Payroll and related
	(728)		(743)
Total reclassifications for the period	$	27,990	$	(11,972)

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Fair Value Measurements and Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2022

Derivative Instruments

Fair Value Measurements, Nonrecurring

The estimated fair value of our financial instruments that are not measured at fair value, categorized based upon the fair value hierarchy, are as follows (in thousands): 

	Fair Value Measurements at March 31, 2022										Fair Value Measurements at December 31, 2021
Description	Total Carrying Amount		Total Fair Value		Level 1(1)		Level 2(2)		Level 3(3)		Total Carrying Amount		Total Fair Value		Level 1(1)		Level 2(2)		Level 3(3)
Assets:
Cash and cash equivalents(4)	$	1,968,504	$	1,968,504	$	1,968,504	$	—	$	—	$	2,701,770	$	2,701,770	$	2,701,770	$	—	$	—
Total Assets	$	1,968,504	$	1,968,504	$	1,968,504	$	—	$	—	$	2,701,770	$	2,701,770	$	2,701,770	$	—	$	—
Liabilities:
Long-term debt (including current portion of debt)(5)	$	22,073,589	$	23,323,063	$	—	$	23,323,063	$	—	$	20,618,065	$	22,376,480	$	—	$	22,376,480	$	—
Total Liabilities	$	22,073,589	$	23,323,063	$	—	$	23,323,063	$	—	$	20,618,065	$	22,376,480	$	—	$	22,376,480	$	—

(1) Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

(2) Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company.

(3) Inputs that are unobservable. The Company did not use any Level 3 inputs as of March 31, 2022 and December 31, 2021.

(4) Consists of cash and marketable securities with original maturities of less than 90 days.

(5) Consists of unsecured revolving credit facilities, senior notes, term loans and convertible notes. These amounts do not include our finance lease obligations or commercial paper.

The following table presents information about the Company’s nonfinancial instruments recorded at fair value on a nonrecurring basis (in thousands):

	Fair Value Measurements at December 31, 2021
Description	Total Carrying Amount	Total Fair Value	Level 3	Total Impairment for the Year Ended December 31, 2021 (1)
Long-lived assets	—	—	—	55,213
Total	—	—	—	55,213

(1) Amount is primarily composed of construction in progress assets that were impaired during the year ended 2021 due to a reduction in scope or the decision to not complete the projects. The impairments were calculated based on orderly liquidation values. The fair value of these assets was estimated as of the date the assets were last impaired.

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

Assets and liabilities that are recorded at fair value have been categorized based upon the fair value hierarchy. The following table presents information about the Company’s financial instruments recorded at fair value on a recurring basis (in thousands):

	Fair Value Measurements at March 31, 2022								Fair Value Measurements at December 31, 2021
Description	Total		Level 1(1)		Level 2(2)		Level 3(3)		Total		Level 1(1)		Level 2(2)		Level 3(3)
Assets:
Derivative financial instruments(4)	$	241,254	$	—	$	241,254	$	—	$	69,808	$	—	$	69,808	$	—
Total Assets	$	241,254	$	—	$	241,254	$	—	$	69,808	$	—	$	69,808	$	—
Liabilities:
Derivative financial instruments(5)	$	117,708	$	—	$	117,708	$	—	$	200,541	$	—	$	200,541	$	—
Total Liabilities	$	117,708	$	—	$	117,708	$	—	$	200,541	$	—	$	200,541	$	—

(1)Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

(2)Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company.

(3)Inputs that are unobservable. No Level 3 inputs were used in fair value measurements of Other financial instruments as of March 31, 2022 and December 31, 2021.

(4)Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

(5) Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

Offsetting Assets

The following table presents information about the Company’s offsetting of financial assets under master netting agreements with derivative counterparties (in thousands):

	Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
	As of March 31, 2022								As of December 31, 2021
	Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Liabilities		Cash Collateral Received		Net Amount of Derivative Assets		Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Liabilities		Cash Collateral Received		Net Amount of Derivative Assets
Derivatives subject to master netting agreements	$	241,254	$	(68,784)	$	—	$	172,470	$	69,808	$	(67,995)	$	—	$	1,813
Total	$	241,254	$	(68,784)	$	—	$	172,470	$	69,808	$	(67,995)	$	—	$	1,813

Offsetting Liabilities

The following table presents information about the Company’s offsetting of financial liabilities under master netting agreements with derivative counterparties (in thousands):

	Gross Amounts not Offset in the Consolidated Balance Sheet that are Subject to Master Netting Agreements
	As of March 31, 2022								As of December 31, 2021
	Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Assets		Cash Collateral Pledged		Net Amount of Derivative Liabilities		Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet		Gross Amount of Eligible Offsetting Recognized Derivative Assets		Cash Collateral Pledged		Net Amount of Derivative Liabilities
Derivatives subject to master netting agreements	$	(117,708)	$	68,784	$	16,668	$	(32,256)	$	(200,541)	$	67,995	$	44,411	$	(88,135)
Total	$	(117,708)	$	68,784	$	16,668	$	(32,256)	$	(200,541)	$	67,995	$	44,411	$	(88,135)

Schedule of Price Risk Derivatives

As of March 31, 2022 and December 31, 2021, we had the following outstanding fuel swap agreements:

	Fuel Swap Agreements
	As of March 31, 2022	As of December 31, 2021
Designated as hedges:	(metric tons)
2022	660,650	821,850
2023	249,050	249,050

	Fuel Swap Agreements
	As of March 31, 2022		As of December 31, 2021
	(% hedged)
Designated hedges as a % of projected fuel purchases:
2022	55	%	54	%
2023	15	%	15	%

	Fuel Swap Agreements
	As of March 31, 2021	As of December 31, 2021
Not designated as hedges:	(metric tons)
2022(1)	139,100	231,900
2023	—	—

(1)    As of March 31, 2022, 69,550 metric tons relate to fuel swap agreements with discontinued hedge accounting, in which we effectively pay fixed prices and receive floating prices from the counterparty. The remaining 69,550 tons relate to fuel swap agreements that were not designated as hedges since inception, in which we effectively pay floating prices and receive fixed prices from the counterparty.

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets were as follows (in thousands):

	Fair Value of Derivative Instruments
	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	As of March 31, 2022		As of December 31, 2021		Balance Sheet Location	As of March 31, 2022		As of December 31, 2021
		Fair Value		Fair Value			Fair Value		Fair Value
Derivatives designated as hedging instruments under ASC 815-20(1)
Interest rate swaps	Other assets	$	23,791	$	—	Other long-term liabilities	$	1,072	$	62,080
Interest rate-swaps	Derivative financial instruments	741		6,478		Derivative financial instruments	—		—
Foreign currency forward contracts	Derivative financial instruments	15,133		7,357		Derivative financial instruments	84,872		116,027
Foreign currency forward contracts	Other assets	3,932		2,070		Other long-term liabilities	15,082		8,813
Fuel swaps	Derivative financial instruments	145,456		31,919		Derivative financial instruments	—		7,944
Fuel swaps	Other assets	35,370		13,452		Other long-term liabilities	—		1,202
Total derivatives designated as hedging instruments under 815-20		$	224,423	$	61,276		$	101,026	$	196,066
Derivatives not designated as hedging instruments under ASC 815-20
Foreign currency forward contracts	Derivative financial instruments	$	—	$	—	Derivative financial instruments	$	—	$	—
Foreign currency forward contracts	Other assets	—		—		Other long-term liabilities	—		—
Fuel swaps	Derivative financial instruments	16,831		8,430		Derivative financial instruments	16,682		3,264
Fuel swaps	Other Assets	—		102		Other long-term liabilities	—		1,211
Total derivatives not designated as hedging instruments under 815-20		16,831		8,532			16,682		4,475
Total derivatives		$	241,254	$	69,808		$	117,708	$	200,541

(1)Accounting Standard Codification 815-20 “Derivatives and Hedging.”

The fair value and line item caption of derivative instruments recorded within our consolidated balance sheets for the cumulative basis adjustment for fair value hedges were as follows (in thousands):

Line Item in the Statement of Financial Position Where the Hedged Item is Included	Carrying Amount of the Hedged Liabilities				Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities
	As of March 31, 2022		As of December 31, 2021		As of March 31, 2022		As of December 31, 2021
Current portion of debt and Long-term debt	$	649,755	$	655,502	$	404	$	6,428
	$	649,755	$	655,502	$	404	$	6,428

Fair Value and Line Item Caption of Non-derivative Instruments

The carrying value and line item caption of non-derivative instruments designated as hedging instruments recorded within our consolidated balance sheets were as follows (in thousands):

		Carrying Value
Non-derivative instrument designated as hedging instrument under ASC 815-20	Balance Sheet Location	As of March 31, 2022		As of December 31, 2021
Foreign currency debt	Current portion of debt	$	64,938	$	75,518
Foreign currency debt	Long-term debt	45,165		34,795
		$	110,103	$	110,313

Non Derivative Instruments Qualifying and Designated as Hedging Instruments in Net Investment Hedges

The effect of non-derivative instruments qualifying and designated as net investment hedging instruments on the consolidated financial statements was as follows (in thousands):

	Amount of Gain (Loss) Recognized in Other Comprehensive Loss
Non-derivative instruments under ASC 815-20 Net Investment Hedging Relationships	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Foreign Currency Debt	$	2,745	$	5,822
	$	2,745	$	5,822

Not Designated as Hedging Instrument

Derivative Instruments

Derivative Instruments, Gain (Loss)

The effect of derivatives not designated as hedging instruments on the consolidated financial statements was as follows (in thousands):

		Amount of Gain (Loss) Recognized in Income on Derivatives
Derivatives Not Designated as Hedging Instruments under ASC 815-20	Location of Gain (Loss) Recognized in Income on Derivatives	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Foreign currency forward contracts	Other income (expense)	$	(6,985)	$	(13,498)
Fuel swaps	Other income (expense)	(7)		12,655
		$	(6,992)	$	(843)

Fair Value Hedging

Derivative Instruments

Schedule of Interest Rate Derivatives

At March 31, 2022 and December 31, 2021, we maintained interest rate swap agreements on the following fixed-rate debt instruments:

Debt Instrument	Swap Notional as of March 31, 2022 (in thousands)		Maturity	Debt Fixed Rate	Swap Floating Rate: LIBOR plus	All-in Swap Floating Rate as of March 31, 2022
Unsecured senior notes	650,000		November 2022	5.25%	3.63%	4.14%
	$	650,000

Derivative Instruments, Gain (Loss)

The effect of derivative instruments qualifying and designated as hedging instruments and the related hedged items in fair value hedges on the consolidated statements of comprehensive loss was as follows (in thousands):

Derivatives and Related Hedged Items under ASC 815-20 Fair Value Hedging Relationships	Location of Gain (Loss) Recognized in Income on Derivative and Hedged Item	Amount of Gain (Loss) Recognized in Income on Derivative				Amount of Gain (Loss) Recognized in Income on Hedged Item
		Quarter Ended March 31, 2022		Quarter Ended March 31, 2021		Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Interest rate swaps	Interest expense (income), net of interest capitalized	$	(3,365)	$	(552)	$	6,024	$	2,930
		$	(3,365)	$	(552)	$	6,024	$	2,930

Cash flow hedge

Derivative Instruments

Schedule of Interest Rate Derivatives

At March 31, 2022 and December 31, 2021, we maintained interest rate swap agreements on the following floating-rate debt instruments:

Debt Instrument	Swap Notional as of March 31, 2022 (in thousands)		Maturity	Debt Floating Rate		All-in Swap Fixed Rate
Celebrity Reflection term loan	$	163,625	October 2024	LIBOR plus	0.40%	2.85%
Quantum of the Seas term loan	306,250		October 2026	LIBOR plus	1.30%	3.74%
Anthem of the Seas term loan	332,292		April 2027	LIBOR plus	1.30%	3.86%
Ovation of the Seas term loan	449,583		April 2028	LIBOR plus	1.00%	3.16%
Harmony of the Seas term loan (1)	417,714		May 2028	EURIBOR plus	1.15%	2.26%
Odyssey of the Seas term loan (2)	421,667		October 2032	LIBOR plus	0.96%	3.21%
Odyssey of the Seas term loan (2)	191,667		October 2032	LIBOR plus	0.96%	2.84%
	$	2,282,798

(1)Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of March 31, 2022.

(2)Interest rate swap agreements hedging the term loan of Odyssey of the Seas include LIBOR zero-floors matching the debt LIBOR zero-floor. The effective dates of the $421.7 million and $191.7 million interest rate swap agreements are October 2020 and October 2022, respectively. The unsecured term loan for the financing of Odyssey of the Seas was drawn on March 2021.

Derivative Instruments, Gain (Loss)

The effect of derivative instruments qualifying and designated as cash flow hedging instruments on the consolidated financial statements was as follows (in thousands):

Derivatives under ASC 815-20 Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives
	Quarter Ended March 31, 2022		Quarter Ended March 31, 2021
Interest rate swaps	$	74,865	$	43,408
Foreign currency forward contracts	(40,062)		(99,581)
Fuel swaps	189,816		55,246
	$	224,619	$	(927)

The table below represents amounts excluded from the assessment of effectiveness for our net investment hedging instruments for which the difference between changes in fair value and periodic amortization is recorded in accumulated other comprehensive income (loss) (in thousands):

Gain (Loss) Recognized in Income (Net Investment Excluded Components)	Three Months Ended March 31, 2022
Net inception fair value at January 1, 2022	$	(554)
Amount of gain recognized in income on derivatives for the period ended March 31, 2022	577
Amount of gain (loss) remaining to be amortized in accumulated other comprehensive loss, as of March 31, 2022	(39)
Fair value at March 31, 2022	$	(16)

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General (Details) destination in Thousands		1 Months Ended
		Jun. 30, 2023 USD ($)	Feb. 28, 2022 USD ($)	Mar. 31, 2022 USD ($) ship destination continent brand	Dec. 31, 2021 USD ($)	Mar. 19, 2021 USD ($) ship
Schedule of Equity Method Investments [Line Items]
Number of cruise brands | brand				3
Number of cruise ships | ship				62
Number of destinations | destination				1
Number of continents | continent				7
Number of ships operated | ship				54
Percentage of ships resumed operations				90.00%
Liquidity				$ 3,800,000,000
Cash and cash equivalents				$ 1,968,504,000	$ 2,701,770,000
Disposal Group, Disposed of by Sale, Not Discontinued Operations | Azamara
Schedule of Equity Method Investments [Line Items]
Number of ships disposed of | ship						3
Total consideration from sale						$ 201,000,000
Scenario, Forecast
Schedule of Equity Method Investments [Line Items]
Long-term debt to be refinanced		$ 3,200,000,000
Maximum
Schedule of Equity Method Investments [Line Items]
Investment in a joint venture, percentage of interest				50.00%
Maximum | Unsecured senior notes
Schedule of Equity Method Investments [Line Items]
Interest rate	[1]			9.13%
Maximum | Secured senior notes
Schedule of Equity Method Investments [Line Items]
Interest rate	[1]			11.50%
Maximum | Convertible notes
Schedule of Equity Method Investments [Line Items]
Interest rate	[1]			4.25%
Minimum
Schedule of Equity Method Investments [Line Items]
Investment in a joint venture, percentage of interest				20.00%
Minimum | Unsecured senior notes
Schedule of Equity Method Investments [Line Items]
Interest rate	[1]			3.70%
Minimum | Secured senior notes
Schedule of Equity Method Investments [Line Items]
Interest rate	[1]			10.88%
Minimum | Convertible notes
Schedule of Equity Method Investments [Line Items]
Interest rate	[1]			2.88%
Senior Secured Notes, Due 2023 | Secured senior notes
Schedule of Equity Method Investments [Line Items]
Interest rate			10.875%
Senior Guaranteed Notes | Unsecured senior notes
Schedule of Equity Method Investments [Line Items]
Interest rate			9.125%
Convertible Notes 4.25%, Due 2023 | Convertible notes
Schedule of Equity Method Investments [Line Items]
Interest rate			4.25%
Senior Unsecured Note, Backstop Committed Financing
Schedule of Equity Method Investments [Line Items]
Debt instrument, term			5 years
Debt instrument, face amount			$ 3,150,000,000
Revolving Credit Facility
Schedule of Equity Method Investments [Line Items]
Maximum borrowing capacity				$ 1,100,000,000
Line of Credit | Term Loan Facility, $700 Million
Schedule of Equity Method Investments [Line Items]
Maximum borrowing capacity				$ 700,000,000
TUI Cruises
Schedule of Equity Method Investments [Line Items]
Investment in a joint venture, percentage of interest				50.00%

[1] Interest rates based on outstanding loan balance as of March 31, 2022 and, for variable rate debt, include either LIBOR or EURIBOR plus the applicable margin.

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Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2021	Mar. 31, 2022
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounting Standards Update [Extensible Enumeration]	Accounting Standards Update 2020-06 [Member]
Decrease to retained earnings	$ (302,276)	$ 718,609
Cumulative Effect, Period of Adoption, Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Decrease to retained earnings	146,200
Decrease to additional paid in capital	307,600
Increase to debt	$ 161,400

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Revenues - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Capitalized Contract Cost [Line Items]
Passenger ticket revenues	$ 1,059,231	$ 42,014
Contract liability	1,200,000		$ 800,000
Customer refunds	35,200		38,800
Future cruise credits	600,000
Contract asset	95,400		52,900
Commission, transportation and other
Capitalized Contract Cost [Line Items]
Prepaid travel agent commissions	$ 94,700		$ 75,400
Minimum
Capitalized Contract Cost [Line Items]
Length of cruise	2 days
Maximum
Capitalized Contract Cost [Line Items]
Length of cruise	25 days
Port Costs
Capitalized Contract Cost [Line Items]
Passenger ticket revenues	$ 76,900	$ 1,500

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Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Disaggregation of Revenue [Line Items]
Total revenues		$ 1,059,231	$ 42,014
Cruise Itinerary
Disaggregation of Revenue [Line Items]
Total revenues		1,004,778	30,695
Cruise Itinerary | North America
Disaggregation of Revenue [Line Items]
Total revenues	[1]	889,087	0
Cruise Itinerary | Asia Pacific
Disaggregation of Revenue [Line Items]
Total revenues		34,633	29,885
Cruise Itinerary | Europe
Disaggregation of Revenue [Line Items]
Total revenues		1,425	0
Cruise Itinerary | Other regions
Disaggregation of Revenue [Line Items]
Total revenues	[2]	79,633	810
Other Revenues
Disaggregation of Revenue [Line Items]
Total revenues	[3]	$ 54,453	$ 11,319
Passenger Ticket | Other regions
Disaggregation of Revenue [Line Items]
Percentage of revenues by country	[4]	12.00%	0.00%
Passenger Ticket | United States
Disaggregation of Revenue [Line Items]
Percentage of revenues by country		84.00%	0.00%
Passenger Ticket | Singapore
Disaggregation of Revenue [Line Items]
Percentage of revenues by country		4.00%	69.00%
Passenger Ticket | China
Disaggregation of Revenue [Line Items]
Percentage of revenues by country		0.00%	31.00%

[1] Includes the United States, Canada, Mexico and the Caribbean.

[2] Includes seasonality impacted itineraries primarily in South and Latin American countries.

[3] Includes revenues primarily related to cancellation fees, vacation protection insurance, pre- and post-cruise tours and fees for operating certain port facilities. Amounts also include revenues related to procurement and management related services we perform on behalf of our unconsolidated affiliates. Refer to Note 5. Other Assets for more information on our unconsolidated affiliates.

[4] No other individual country's revenue exceeded 10% for the quarters ended March 31, 2022 and 2021.

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(Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Earnings Per Share [Abstract]
Net (Loss) for basic and diluted loss per share	$ (1,167,142)	$ (1,131,722)
Weighted-average common shares outstanding (in shares)	254,821,000	243,004,000
Diluted weighted-average shares outstanding (in shares)	254,821,000	243,004,000
Basic (loss) per share (in dollars per share)	$ (4.58)	$ (4.66)
Diluted (loss) per share (in dollars per share)	$ (4.58)	$ (4.66)
Antidilutive securities (in shares)	23,407,179	413,501

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Other Assets - Narrative (Details) € in Millions	1 Months Ended	3 Months Ended			12 Months Ended
	Apr. 30, 2016	Mar. 31, 2022 USD ($)	Mar. 31, 2021 USD ($)	Mar. 31, 2021 EUR (€)	Dec. 31, 2021 USD ($)	Mar. 31, 2022 EUR (€)	Dec. 31, 2021 EUR (€)
Other Assets
Proceeds from collection of advance to affiliate		$ 4,444,000	$ 12,519,000
Loss provision for receivables		$ 653,000			$ 81,600,000
Minimum
Other Assets
Percentage of ownership interest		20.00%				20.00%
Maximum
Other Assets
Percentage of ownership interest		50.00%				50.00%
TUI Cruises GmbH joint venture
Other Assets
Percentage of ownership interest		50.00%				50.00%
TUI Cruises GmbH joint venture | Not Primary Beneficiary
Other Assets
Percentage of ownership interest		50.00%				50.00%
Investments in entity		$ 404,000,000			444,400,000
Underlying equity in net assets		286,200,000			322,400,000
Advances to affiliate		$ 110,200,000			$ 117,200,000	€ 99.1	€ 103.0
Contribution amount			69,900,000	€ 59.5
TUI Cruises GmbH joint venture | TUI cruise ships
Other Assets
Restriction on reduction of current ownership interest (as a percent)		37.55%				37.55%
TUI Cruises GmbH joint venture | Splendour of the Seas | Not Primary Beneficiary
Other Assets
Debt instrument, term	10 years
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary
Other Assets
Percentage of ownership interest		40.00%				40.00%
Related party transaction, payment amount for ship repair and maintenance		$ 3,700,000
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Loans Receivable
Other Assets
Advances to affiliate		10,600,000
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Non-accrual status of advances to affiliates
Other Assets
Proceeds from collection of advance to affiliate		$ 0	$ 8,900,000
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Non-accrual status of advances to affiliates | Maximum
Other Assets
Interest rate on loan provided to related party (as a percent)		5.75%				5.75%
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Non-accrual status of advances to affiliates | LIBOR | Minimum
Other Assets
Debt instrument, basis spread on variable rate		3.50%
Grand Bahamas Shipyard Ltd. | Not Primary Beneficiary | Non-accrual status of advances to affiliates | LIBOR | Maximum
Other Assets
Debt instrument, basis spread on variable rate		3.75%
Pullmantur Holdings
Other Assets
Loss provision for receivables		$ 12,600,000
Splendour of the Seas | TUI Cruises GmbH joint venture | Not Primary Beneficiary
Other Assets
Interest rate on loan provided to related party (as a percent)	6.25%
Debt, guaranteed percentage	50.00%

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Other Assets - Share of Equity Income From Investments (Details) - USD ($) $ in Thousands		3 Months Ended
		Mar. 31, 2022	Mar. 31, 2021
Other Assets [Abstract]
Share of equity (loss) income from investments		$ (31,059)	$ (59,871)
Dividends received	[1]	$ 423	$ 0

[1] Represents dividends received from our investments accounted for under the equity method of accounting for the quarters ended March 31, 2022 and March 31, 2021

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Other Assets - Notes Receivable Due From Equity Instruments (Details) - USD ($) $ in Thousands		Mar. 31, 2022	Dec. 31, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Total notes receivable due from equity investments		$ 123,157	$ 130,587
Less-current portion	[1]	21,069	21,508
Long-term portion	[2]	$ 102,088	$ 109,079

[1] Included within Trade and other receivables, net in our consolidated balance sheets.

[2] Included within Other assets in our consolidated balance sheets.

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Other Assets - Related Party Transactions (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Other Assets [Abstract]
Revenues	$ 6,372	$ 5,231
Expenses	$ 1,826	$ 1,275

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Other Assets - Summary of Credit Loss Allowance (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance January 1, 2022	$ 100,192
Loss provision for receivables	653	$ 81,600
Write-offs	(8,152)
Ending balance March 31, 2022	$ 92,693	$ 100,192

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Debt - Summary of Debt (Details) - USD ($)		3 Months Ended
		Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Finance lease liabilities		$ 428,387,000	$ 472,275,000
Total debt	[1]	22,918,866,000	21,453,872,000
Less: unamortized debt issuance costs		(416,890,000)	(363,532,000)
Total debt, net of unamortized debt issuance costs		22,501,976,000	21,090,340,000
Less—current portion		(2,558,463,000)	(2,243,131,000)
Long-term portion		$ 19,943,513,000	$ 18,847,209,000
Weighted average interest rate		5.61%	5.47%
Total fixed rate debt
Debt Instrument [Line Items]
Long-term debt, gross		$ 14,795,869,000	$ 12,377,882,000
Unsecured senior notes
Debt Instrument [Line Items]
Long-term debt, gross		$ 6,598,558,000	5,604,498,000
Unsecured senior notes | Minimum
Debt Instrument [Line Items]
Interest rate	[2]	3.70%
Unsecured senior notes | Maximum
Debt Instrument [Line Items]
Interest rate	[2]	9.13%
Secured senior notes
Debt Instrument [Line Items]
Long-term debt, gross		$ 2,357,803,000	2,354,037,000
Secured senior notes | Minimum
Debt Instrument [Line Items]
Interest rate	[2]	10.88%
Secured senior notes | Maximum
Debt Instrument [Line Items]
Interest rate	[2]	11.50%
Unsecured term loans
Debt Instrument [Line Items]
Long-term debt, gross		$ 4,114,508,000	2,860,567,000
Unsecured term loans | Minimum
Debt Instrument [Line Items]
Interest rate	[2]	2.53%
Unsecured term loans | Maximum
Debt Instrument [Line Items]
Interest rate	[2]	5.89%
Convertible notes
Debt Instrument [Line Items]
Long-term debt, gross		$ 1,725,000,000	1,558,780,000
Convertible notes | Minimum
Debt Instrument [Line Items]
Interest rate	[2]	2.88%
Convertible notes | Maximum
Debt Instrument [Line Items]
Interest rate	[2]	4.25%
Total variable rate debt
Debt Instrument [Line Items]
Long-term debt, gross		$ 7,694,610,000	8,603,715,000
Unsecured revolving credit facilities
Debt Instrument [Line Items]
Long-term debt, gross	[3]	1,909,342,000	2,899,342,000
Maximum borrowing capacity		$ 3,200,000,000
Unsecured revolving credit facilities | Minimum
Debt Instrument [Line Items]
Current interest rate	[2],[3]	1.75%
Unsecured revolving credit facilities | Maximum
Debt Instrument [Line Items]
Current interest rate		2.15%
Unsecured revolving credit facilities | Unsecured Revolving Credit Facility Due 2024
Debt Instrument [Line Items]
Current interest rate		1.75%
Maximum borrowing capacity		$ 1,900,000,000
Facility fee		0.20%
Unsecured revolving credit facilities | Unsecured Revolving Credit Facility Due 2024 | LIBOR | Maximum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		1.30%
Unsecured revolving credit facilities | Unsecured Revolving Credit Facility Due 2024
Debt Instrument [Line Items]
Current interest rate		2.15%
Maximum borrowing capacity		$ 1,300,000,000
Unsecured revolving credit facilities | Unsecured Revolving Credit Facility Due 2024 | Maximum
Debt Instrument [Line Items]
Facility fee		0.30%
Unsecured revolving credit facilities | Unsecured Revolving Credit Facility Due 2024 | LIBOR | Maximum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate		1.70%
USD unsecured term loan
Debt Instrument [Line Items]
Long-term debt, gross		$ 5,114,768,000	5,018,740,000
USD unsecured term loan | Minimum
Debt Instrument [Line Items]
Current interest rate	[2]	1.84%
USD unsecured term loan | Maximum
Debt Instrument [Line Items]
Current interest rate	[2]	4.95%
Euro unsecured term loan
Debt Instrument [Line Items]
Long-term debt, gross		$ 670,500,000	$ 685,633,000
Euro unsecured term loan | Minimum
Debt Instrument [Line Items]
Current interest rate	[2]	1.15%
Euro unsecured term loan | Maximum
Debt Instrument [Line Items]
Current interest rate	[2]	2.25%

[1] At March 31, 2022 and December 31, 2021, the weighted average interest rate for total debt was 5.61% and 5.47%, respectively.

[2] Interest rates based on outstanding loan balance as of March 31, 2022 and, for variable rate debt, include either LIBOR or EURIBOR plus the applicable margin.

[3] Includes $1.9 billion facility and $1.3 billion facility, the vast majority of which is due in 2024. Our $1.9 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.30%, which interest was 1.75% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.20%. Our $1.3 billion facility accrues interest at LIBOR plus a maximum interest rate margin of 1.70%, which interest was 2.15% as of March 31, 2022 and is subject to a facility fee of a maximum of 0.30%.

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Debt - Narrative (Details) - USD ($)		1 Months Ended				3 Months Ended
		Apr. 30, 2022	Feb. 28, 2022	Jan. 31, 2022	Jul. 31, 2017	Mar. 31, 2022	Mar. 31, 2021
Long-Term Debt
Debt instrument, collateral amount						$ 117,200,000
Credit card processor agreement, maximum exposure							$ 293,900,000
Senior Unsecured Note, Backstop Committed Financing
Long-Term Debt
Debt instrument, term			5 years
Debt instrument, face amount			$ 3,150,000,000
Bpifrance Assurance Export | Novation Agreement, July 2017
Long-Term Debt
Debt, guaranteed percentage					100.00%
Bpifrance Assurance Export | Unsecured Term Loan Agreement | Subsequent Event
Long-Term Debt
Debt, guaranteed percentage		100.00%
Revolving Credit Facility
Long-Term Debt
Maximum borrowing capacity						1,100,000,000
Unsecured term loans | Novation Agreement, July 2017
Long-Term Debt
Proceeds from debt					$ 1,300,000,000
Debt instrument, term					12 years
Interest rate					3.18%
Unsecured term loans | Unsecured Term Loan Agreement | Subsequent Event
Long-Term Debt
Proceeds from debt		$ 700,000,000
Debt instrument, term		12 years
Interest rate		1.28%
Unsecured senior notes | Senior Notes Due 2027
Long-Term Debt
Interest rate				5.375%
Debt instrument, face amount				$ 1,000,000,000
Proceeds from senior notes				$ 990,000,000
Unsecured senior notes | Senior Guaranteed Notes
Long-Term Debt
Interest rate			9.125%
Revolving Credit Facility
Long-Term Debt
Maximum borrowing capacity						$ 3,200,000,000
Secured senior notes | Senior Secured Notes, Due 2023
Long-Term Debt
Interest rate			10.875%
Convertible notes | Convertible Notes 4.25%, Due 2023
Long-Term Debt
Interest rate			4.25%
Maximum | Unsecured term loans
Long-Term Debt
Interest rate	[1]					5.89%
Maximum | Unsecured senior notes
Long-Term Debt
Interest rate	[1]					9.13%
Maximum | Secured senior notes
Long-Term Debt
Interest rate	[1]					11.50%
Maximum | Convertible notes
Long-Term Debt
Interest rate	[1]					4.25%
Maximum | Contract With Customer, Liability, Up-Front Payment Arrangement
Long-Term Debt
Credit agency fees, percentage of loan amount payable						5.48%
Minimum | Unsecured term loans
Long-Term Debt
Interest rate	[1]					2.53%
Minimum | Unsecured senior notes
Long-Term Debt
Interest rate	[1]					3.70%
Minimum | Secured senior notes
Long-Term Debt
Interest rate	[1]					10.88%
Minimum | Convertible notes
Long-Term Debt
Interest rate	[1]					2.88%
Minimum | Contract With Customer, Liability, Up-Front Payment Arrangement
Long-Term Debt
Credit agency fees, percentage of loan amount payable						2.35%

[1] Interest rates based on outstanding loan balance as of March 31, 2022 and, for variable rate debt, include either LIBOR or EURIBOR plus the applicable margin.

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Debt - Schedule of Maturities (Details) $ in Thousands	Mar. 31, 2022 USD ($)
Debt Disclosure [Abstract]
Remainder of 2022	$ 2,273,401
2023	5,665,482
2024	3,128,924
2025	2,417,492
2026	2,614,571
Thereafter	6,402,106
Total	$ 22,501,976

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Leases - Narrative (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2022 USD ($)	Jan. 31, 2022 extension_option	Dec. 31, 2021 USD ($)	Nov. 30, 2021
Lessee, Lease, Description [Line Items]
Present value of lease liabilities	$ 428,387		$ 472,275
Variable lease cost	7,500
Land and Building
Lessee, Lease, Description [Line Items]
Number of extension options | extension_option		2
Additional lease term		5 years
Present value of lease liabilities	100,300		127,000
Ships | Silver Dawn
Lessee, Lease, Description [Line Items]
Finance lease term				15 years
Present value of lease liabilities	279,000		283,700
Ships | Silver Whisper
Lessee, Lease, Description [Line Items]
Present value of lease liabilities	$ 16,600		$ 24,100
Minimum | Real Estate
Lessee, Lease, Description [Line Items]
Renewal term	1 year
Minimum | Berthing Agreement
Lessee, Lease, Description [Line Items]
Renewal term	1 year
Maximum | Real Estate
Lessee, Lease, Description [Line Items]
Renewal term	10 years
Maximum | Berthing Agreement
Lessee, Lease, Description [Line Items]
Renewal term	20 years

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Leases - Schedule of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Lease, Cost [Abstract]
Amortization of right-of-use-assets	$ 6,093	$ 3,744
Interest on lease liabilities	4,600	310
Total lease costs	43,669	15,219
Commission, transportation and other
Lessee, Lease, Description [Line Items]
Operating lease costs	22,729	0
Other operating expenses
Lessee, Lease, Description [Line Items]
Operating lease costs	5,471	5,130
Marketing, selling and administrative expenses
Lessee, Lease, Description [Line Items]
Operating lease costs	$ 4,776	$ 6,035

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Leases - Schedule of Lease Terms and Discount Rates (Details)	Mar. 31, 2022	Dec. 31, 2021
Weighted average of the remaining lease term in years
Operating leases	18 years 14 days	18 years 2 months 4 days
Finance leases	22 years 10 months 24 days	23 years 11 months 15 days
Weighted average discount rate
Operating leases	6.53%	6.52%
Finance leases	5.95%	5.54%

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Leases - Supplemental Noncash Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Leases [Abstract]
Operating cash flows from operating leases	$ 28,193	$ 5,531
Operating cash flows from finance leases	4,600	310
Financing cash flows from finance leases	$ 17,034	$ 4,305

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Leases - Schedule of Lease Maturities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Operating Leases
Remainder of 2022	$ 79,074
2023	108,241
2024	89,214
2025	81,594
2026	75,519
Thereafter	825,818
Total lease payments	1,259,460
Less: Interest	(661,302)
Present value of lease liabilities	598,158
Finance Leases
Remainder of 2022	49,240
2023	53,069
2024	44,348
2025	43,986
2026	38,843
Thereafter	704,535
Total lease payments	934,021
Less: Interest	(505,634)
Present value of lease liabilities	$ 428,387	$ 472,275

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Commitments and Contingencies - Narrative (Details) $ in Millions	1 Months Ended	3 Months Ended
	Aug. 31, 2019 lawsuit	Mar. 31, 2022 USD ($) berth ship	Dec. 31, 2021
Commitments and Contingencies
Ship passenger capacity berths | berth		41,560
Number of claims filed | lawsuit	2
Number of months considered to determine requirement of prepayment of debts		24 months
Cruise ships on order
Commitments and Contingencies
Aggregate cost of ships on order, not including TUI cruises on order | $		$ 10,700.0
Deposit for the purchase of ships expected to enter service | $		$ 618.5
Percentage of aggregate cost exposed to fluctuations in the euro exchange rate		61.80%	59.00%
Line of Credit | Minimum
Commitments and Contingencies
Debt instrument covenant, minimum percentage of ownership by a person		50.00%
Debt Securities | Minimum
Commitments and Contingencies
Debt instrument covenant, minimum percentage of ownership by a person		50.00%
Royal Caribbean International Cruise Ships | Cruise ships on order
Commitments and Contingencies
Ship passenger capacity berths | berth		22,500
Royal Caribbean International Cruise Ships | Utopia of the Seas | Cruise ships on order
Commitments and Contingencies
Number of ships under construction | ship		1
Royal Caribbean International Cruise Ships | Project Icon Ships | Cruise ships on order
Commitments and Contingencies
Number of ships under construction | ship		3
Celebrity Cruises | Edge Class Ships | Cruise ships on order
Commitments and Contingencies
Number of ships under construction | ship		2
Ship passenger capacity berths | berth		6,500
Silversea Cruises | Silversea Cruises | Cruise ships on order
Commitments and Contingencies
Number of ships under construction | ship		2
Ship passenger capacity berths | berth		1,460

XML

Commitment and Contingencies - Capital Commitments (Details)	Mar. 31, 2022 berth
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	41,560
Royal Caribbean International | Utopia of the Seas
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	5,700
Royal Caribbean International | Icon of the Seas
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	5,600
Royal Caribbean International | Icon Class, Unnamed Ship Two
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	5,600
Royal Caribbean International | Icon Class, Unnamed Ship Three
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	5,600
Celebrity Cruises | Celebrity Beyond
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	3,250
Celebrity Cruises | Celebrity Ascent
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	3,250
Silversea Cruises | Silver Nova
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	730
Silversea Cruises | Evolution Class, Unnamed
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	730
TUI Cruises | Mein Schiff 7
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	2,900
TUI Cruises | TUI Cruises, Unnamed Ship One
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	4,100
TUI Cruises | TUI Cruises, Unnamed Ship Two
Long-term Purchase Commitment [Line Items]
Ship passenger capacity berths	4,100

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Shareholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions	1 Months Ended	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021	Dec. 31, 2020
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Accounting Standards Update [Extensible Enumeration]				Accounting Standards Update 2020-06 [Member]
Change in stockholders' equity	$ 9,172,382	$ 3,988,928	$ 9,172,382	$ 5,085,556	$ 8,760,669
Shares issued (in shares)	16.9
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01	$ 0.01
Stock price (in dollars per share)	$ 91.00		91.00
Proceeds from sale of stock	$ 1,500,000
Dividend declared (in dollars per share)		$ 0	$ 0
Cumulative Effect, Period of Adoption, Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Change in stockholders' equity				$ (161,420)

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Changes in Accumulated Other Comprehensive Loss - Changes in AOCI by Component (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Changes in accumulated other comprehensive loss by component
Beginning balance	$ 5,085,556	$ 8,760,669
Ending balance	3,988,928	9,172,382
Changes related to cash flow derivative hedges
Changes in accumulated other comprehensive loss by component
Beginning balance	(646,473)	(650,519)
Other comprehensive income (loss) before reclassifications	224,619	(927)
Amounts reclassified from accumulated other comprehensive loss	(28,718)	11,229
Net current-period other comprehensive income (loss)	195,901	10,302
Ending balance	(450,572)	(640,217)
Changes in defined benefit plans
Changes in accumulated other comprehensive loss by component
Beginning balance	(56,835)	(65,542)
Other comprehensive income (loss) before reclassifications	11,869	9,720
Amounts reclassified from accumulated other comprehensive loss	728	743
Net current-period other comprehensive income (loss)	12,597	10,463
Ending balance	(44,238)	(55,079)
Foreign currency translation adjustments
Changes in accumulated other comprehensive loss by component
Beginning balance	(7,577)	(23,280)
Other comprehensive income (loss) before reclassifications	7,778	9,722
Amounts reclassified from accumulated other comprehensive loss	0	0
Net current-period other comprehensive income (loss)	7,778	9,722
Ending balance	201	(13,558)
Accumulated  other comprehensive loss
Changes in accumulated other comprehensive loss by component
Beginning balance	(710,885)	(739,341)
Other comprehensive income (loss) before reclassifications	244,266	18,515
Amounts reclassified from accumulated other comprehensive loss	(27,990)	11,972
Net current-period other comprehensive income (loss)	216,276	30,487
Ending balance	$ (494,609)	$ (708,854)

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Changes in Accumulated Other Comprehensive Loss - Reclassifications (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Reclassifications out of accumulated other comprehensive loss
Interest expense, net of interest capitalized	$ (277,659)	$ (272,514)
Depreciation and amortization expenses	(339,467)	(310,166)
Other income (expense)	(2,538)	5,033
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income
Reclassifications out of accumulated other comprehensive loss
Total reclassifications for the period	27,990	(11,972)
Loss on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income
Reclassifications out of accumulated other comprehensive loss
Total reclassifications for the period	28,718	(11,229)
Loss on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | Interest rate swaps
Reclassifications out of accumulated other comprehensive loss
Interest expense, net of interest capitalized	(10,434)	(9,509)
Loss on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | Foreign currency forward contracts
Reclassifications out of accumulated other comprehensive loss
Depreciation and amortization expenses	(4,065)	(3,781)
Other income (expense)	(1,218)	(1,291)
Loss on cash flow derivative hedges | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income | Fuel swaps
Reclassifications out of accumulated other comprehensive loss
Other income (expense)	(369)	(407)
Fuel	44,804	3,759
Changes in defined benefit plans | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income (Loss) into Income
Reclassifications out of accumulated other comprehensive loss
Payroll and related	(728)	(743)
Total reclassifications for the period	$ (728)	$ (743)

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Fair Value Measurements and Derivative Instruments - Estimated Fair Value (Details) - Nonrecurring - USD ($) $ in Thousands		Mar. 31, 2022	Dec. 31, 2021
Level 1
Assets:
Cash and cash equivalents	[1],[2]	$ 1,968,504	$ 2,701,770
Total Assets	[2]	1,968,504	2,701,770
Liabilities:
Long-term debt (including current portion of long-term debt)	[2],[3]	0	0
Total Liabilities	[2]	0	0
Level 2
Assets:
Cash and cash equivalents	[1],[4]	0	0
Total Assets	[4]	0	0
Liabilities:
Long-term debt (including current portion of long-term debt)	[3],[4]	23,323,063	22,376,480
Total Liabilities	[4]	23,323,063	22,376,480
Level 3
Assets:
Cash and cash equivalents	[1],[5]	0	0
Total Assets	[5]	0	0
Liabilities:
Long-term debt (including current portion of long-term debt)	[3],[5]	0	0
Total Liabilities	[5]	0	0
Total Carrying Amount
Assets:
Cash and cash equivalents	[1]	1,968,504	2,701,770
Total Assets		1,968,504	2,701,770
Liabilities:
Long-term debt (including current portion of long-term debt)	[3]	22,073,589	20,618,065
Total Liabilities		22,073,589	20,618,065
Total Fair Value
Assets:
Cash and cash equivalents	[1]	1,968,504	2,701,770
Total Assets		1,968,504	2,701,770
Liabilities:
Long-term debt (including current portion of long-term debt)	[3]	23,323,063	22,376,480
Total Liabilities		$ 23,323,063	$ 22,376,480

[1] Consists of cash and marketable securities with original maturities of less than 90 days.

[2] Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

[3] Consists of unsecured revolving credit facilities, senior notes, term loans and convertible notes. These amounts do not include our finance lease obligations or commercial paper.

[4] Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company.

[5] Inputs that are unobservable. The Company did not use any Level 3 inputs as of March 31, 2022 and December 31, 2021.

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Fair Value Measurements and Derivative Instruments - Recurring (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands		Mar. 31, 2022	Dec. 31, 2021
Level 1
Assets:
Derivative financial instruments	[1],[2]	$ 0	$ 0
Total Assets	[2]	0	0
Liabilities:
Derivative financial instruments	[2],[3]	0	0
Total Liabilities	[2]	0	0
Level 2
Assets:
Derivative financial instruments	[1],[4]	241,254	69,808
Total Assets	[4]	241,254	69,808
Liabilities:
Derivative financial instruments	[3],[4]	117,708	200,541
Total Liabilities	[4]	117,708	200,541
Level 3
Assets:
Derivative financial instruments	[1],[5]	0	0
Total Assets	[5]	0	0
Liabilities:
Derivative financial instruments	[3],[5]	0	0
Total Liabilities	[5]	0	0
Total
Assets:
Derivative financial instruments	[1]	241,254	69,808
Total Assets		241,254	69,808
Liabilities:
Derivative financial instruments	[3]	117,708	200,541
Total Liabilities		$ 117,708	$ 200,541

[1] Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.(5

[2] Inputs based on quoted prices (unadjusted) in active markets for identical assets or liabilities that we have the ability to access. Valuation of these items does not entail a significant amount of judgment.

[3] Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

[4] Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. For foreign currency forward contracts, interest rate swaps and fuel swaps, fair value is derived using valuation models that utilize the income valuation approach. These valuation models take into account the contract terms, such as maturity, as well as other inputs, such as foreign exchange rates and curves, fuel types, fuel curves and interest rate yield curves. Derivative instrument fair values take into account the creditworthiness of the counterparty and the Company.

[5] Inputs that are unobservable. No Level 3 inputs were used in fair value measurements of Other financial instruments as of March 31, 2022 and December 31, 2021.

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Fair Value Measurements and Derivative Instruments - Nonrecurring (Details) - USD ($) $ in Thousands		3 Months Ended		12 Months Ended
		Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairment and credit losses (recoveries)		$ 173	$ (449)
Nonrecurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets, impairment	[1]			$ 55,213
Impairment and credit losses (recoveries)	[1]			55,213
Nonrecurring | Total Carrying Amount
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets				0
Total				0
Nonrecurring | Total Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets				0
Total				0
Nonrecurring | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-lived assets				0
Total				$ 0

[1] Amount is primarily composed of construction in progress assets that were impaired during the year ended 2021 due to a reduction in scope or the decision to not complete the projects. The impairments were calculated based on orderly liquidation values. The fair value of these assets was estimated as of the date the assets were last impaired.

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Fair Value Measurements and Derivative Instruments - Offsetting of Derivative Instruments (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Offsetting of Financial Assets under Master Netting Agreements [Abstract]
Gross Amount of Derivative Assets Presented in the Consolidated Balance Sheet	$ 241,254	$ 69,808
Gross Amount of Eligible Offsetting Recognized Derivative Liabilities	(68,784)	(67,995)
Cash Collateral Received	0	0
Net Amount of Derivative Assets	172,470	1,813
Offsetting of Financial Liabilities under Master Netting Agreements [Abstract]
Gross Amount of Derivative Liabilities Presented in the Consolidated Balance Sheet	(117,708)	(200,541)
Gross Amount of Eligible Offsetting Recognized Derivative Assets	68,784	67,995
Cash Collateral Pledged	16,668	44,411
Net Amount of Derivative Liabilities	$ (32,256)	$ (88,135)

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Fair Value Measurements and Derivative Instruments - Derivative Instruments, Interest Rate Risk, Foreign Currency Exchange Rate Risk (Narrative) (Details) $ in Thousands, € in Millions	3 Months Ended			12 Months Ended
	Mar. 31, 2022 USD ($)	Mar. 31, 2022 EUR (€)	Mar. 31, 2021 USD ($)	Dec. 31, 2021 USD ($)	Dec. 31, 2021 EUR (€)	Mar. 31, 2022 EUR (€)
Gains and losses from derivatives involved in hedging relationships
Derivative instrument, credit risk exposure	$ 157,700
Maximum length of time hedged in derivative contract	3 years	3 years
Percentage of debt bearing fixed interest	71.60%			65.70%		71.60%
Foreign currency gain (loss)	$ 7,200		$ 4,400
Interest rate swaps
Gains and losses from derivatives involved in hedging relationships
Notional amount	2,900,000			$ 2,900,000
Forward Contracts | Not Designated
Gains and losses from derivatives involved in hedging relationships
Notional amount	800,000
Foreign currency forward contracts | Not Designated
Gains and losses from derivatives involved in hedging relationships
Change in fair value of foreign currency forward contracts recognized in earnings	(7,000)		$ (13,500)
Foreign exchange contracts
Gains and losses from derivatives involved in hedging relationships
Notional amount	2,800,000			$ 3,400,000
Cruise ships on order
Gains and losses from derivatives involved in hedging relationships
Aggregate cost of ships on order, not including partner brands on order	10,700,000
Amount deposited for cost of ships on order	$ 618,500
Percentage of aggregate cost exposed to fluctuations in the euro exchange rate	61.80%			59.00%		61.80%
TUI Cruises | Forward Contracts | Designated as Hedging Instrument
Gains and losses from derivatives involved in hedging relationships
Notional amount	$ 272,500					€ 245.0
Foreign currency debt
Gains and losses from derivatives involved in hedging relationships
Carrying value of non-derivative instrument designated as hedging instrument	110,103			$ 110,313
Foreign currency debt | TUI Cruises
Gains and losses from derivatives involved in hedging relationships
Carrying value of non-derivative instrument designated as hedging instrument	$ 110,100	€ 99.0		$ 110,300	€ 97.0

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Fair Value Measurements and Derivative Instruments - Interest Rate Risk (Details) - Interest rate swaps	3 Months Ended
	Mar. 31, 2022 USD ($)
Fair Value Hedging
Interest Rate Fair Value Hedges [Abstract]
Long-term debt	$ 650,000,000
Fair Value Hedging | Unsecured senior notes
Interest Rate Fair Value Hedges [Abstract]
Long-term debt	$ 650,000,000
Debt Fixed Rate	5.25%
Cash flow hedge
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 2,282,798,000
Cash flow hedge | Celebrity Reflection term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 163,625,000
All-in Swap Fixed Rate	2.85%
Cash flow hedge | Quantum of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 306,250,000
All-in Swap Fixed Rate	3.74%
Cash flow hedge | Anthem of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 332,292,000
All-in Swap Fixed Rate	3.86%
Cash flow hedge | Ovation of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 449,583,000
All-in Swap Fixed Rate	3.16%
Cash flow hedge | Harmony of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 417,714,000	[1]
All-in Swap Fixed Rate	2.26%	[1],[2]
Cash flow hedge | Odyssey of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 421,667,000	[3]
All-in Swap Fixed Rate	3.21%	[3]
Cash flow hedge | Odyssey of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Swap notional amount	$ 191,667,000	[3],[4]
All-in Swap Fixed Rate	2.84%	[3]
LIBOR | Fair Value Hedging | Unsecured senior notes
Interest Rate Fair Value Hedges [Abstract]
Swap Floating Rate: LIBOR plus	3.63%
All-in swap floating rate	4.14%
LIBOR | Cash flow hedge | Celebrity Reflection term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	0.40%
LIBOR | Cash flow hedge | Quantum of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	1.30%
LIBOR | Cash flow hedge | Anthem of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	1.30%
LIBOR | Cash flow hedge | Ovation of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	1.00%
LIBOR | Cash flow hedge | Odyssey of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	0.96%	[3]
LIBOR | Cash flow hedge | Odyssey of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	0.96%	[3]
EURIBOR | Cash flow hedge | Harmony of the Seas term loan
Interest Rate Cash Flow Hedges [Abstract]
Debt Floating Rate	1.15%	[1]

[1] Interest rate swap agreements hedging the Euro-denominated term loan for Harmony of the Seas include EURIBOR zero-floor matching the hedged debt EURIBOR zero-floor. Amount presented is based on the exchange rate as of March 31, 2022.

[2] Inputs other than quoted prices included within Level 1 that are observable for the liability, either directly or indirectly. For unsecured revolving credit facilities and unsecured term loans, fair value is determined utilizing the income valuation approach. This valuation model takes into account the contract terms of our debt such as the debt maturity and the interest rate on the debt. The valuation model also takes into account the creditworthiness of the Company.

[3] Interest rate swap agreements hedging the term loan of Odyssey of the Seas include LIBOR zero-floors matching the debt LIBOR zero-floor. The effective dates of the $421.7 million and $191.7 million interest rate swap agreements are October 2020 and October 2022, respectively. The unsecured term loan for the financing of Odyssey of the Seas was drawn on March 2021.

[4] Consists of foreign currency forward contracts, interest rate swaps and fuel swaps. Refer to the "Fair Value of Derivative Instruments" table for breakdown by instrument type.

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Fair Value Measurements and Derivative Instruments - Fuel Price Risk (Details) - Fuel Swap Agreements $ in Millions		3 Months Ended
		Mar. 31, 2021 USD ($) T	Mar. 31, 2022 USD ($) T t	Dec. 31, 2021 USD ($) t T
Derivative Instruments
Discontinued cash flow hedge, nonmonetary amount | T		48,000
Estimated unrealized net loss associated with cash flow hedges pertaining to fuel swap agreements expected to be reclassified to earnings from accumulated other comprehensive income loss | $			$ 145.6	$ 23.8
Other income (expense)
Derivative Instruments
Reclassification | $		$ 4.4
2022
Derivative Instruments
Fuel Swap Agreements (metric tons) | T			660,650	821,850
Percentage of projected requirements			55.00%	54.00%
2022 | Not Designated as Hedging Instrument
Derivative Instruments
Discontinued cash flow hedge, nonmonetary amount			69,550
Fuel Swap Agreements (metric tons)	[1]		139,100	231,900
Notional amount since inception			69,550
2023
Derivative Instruments
Fuel Swap Agreements (metric tons) | T			249,050	249,050
Percentage of projected requirements			15.00%	15.00%
2023 | Not Designated as Hedging Instrument
Derivative Instruments
Fuel Swap Agreements (metric tons)			0	0

[1] As of March 31, 2022, 69,550 metric tons relate to fuel swap agreements with discontinued hedge accounting, in which we effectively pay fixed prices and receive floating prices from the counterparty. The remaining 69,550 tons relate to fuel swap agreements that were not designated as hedges since inception, in which we effectively pay floating prices and receive fixed prices from the counterparty.

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Fair Value Measurements and Derivative Instruments - Balance Sheet (Details) - USD ($) $ in Thousands		Mar. 31, 2022	Dec. 31, 2021
Asset Derivatives
Asset Derivatives		$ 241,254	$ 69,808
Liability Derivatives
Liability Derivatives		117,708	200,541
Designated as Hedging Instrument
Asset Derivatives
Asset Derivatives	[1]	224,423	61,276
Liability Derivatives
Liability Derivatives	[1]	101,026	196,066
Notional Disclosures
Carrying Amount of the Hedged Liabilities		649,755	655,502
Cumulative amount of Fair Value Hedging Adjustment Included in the Carrying Amount of the Hedged Liabilities		404	6,428
Not Designated as Hedging Instrument
Asset Derivatives
Asset Derivatives		16,831	8,532
Liability Derivatives
Liability Derivatives		16,682	4,475
Interest rate swaps | Designated as Hedging Instrument | Other assets
Asset Derivatives
Asset Derivatives	[1]	23,791	0
Interest rate swaps | Designated as Hedging Instrument | Derivative financial instruments
Asset Derivatives
Asset Derivatives		741	6,478
Liability Derivatives
Liability Derivatives		0	0
Interest rate swaps | Designated as Hedging Instrument | Other long-term liabilities
Liability Derivatives
Liability Derivatives	[1]	1,072	62,080
Foreign currency forward contracts | Designated as Hedging Instrument | Other assets
Asset Derivatives
Asset Derivatives	[1]	3,932	2,070
Foreign currency forward contracts | Designated as Hedging Instrument | Derivative financial instruments
Asset Derivatives
Asset Derivatives	[1]	15,133	7,357
Liability Derivatives
Liability Derivatives	[1]	84,872	116,027
Foreign currency forward contracts | Designated as Hedging Instrument | Other long-term liabilities
Liability Derivatives
Liability Derivatives	[1]	15,082	8,813
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other assets
Asset Derivatives
Asset Derivatives		0	0
Foreign currency forward contracts | Not Designated as Hedging Instrument | Derivative financial instruments
Asset Derivatives
Asset Derivatives		0	0
Liability Derivatives
Liability Derivatives		0	0
Foreign currency forward contracts | Not Designated as Hedging Instrument | Other long-term liabilities
Liability Derivatives
Liability Derivatives		0	0
Fuel swaps | Designated as Hedging Instrument | Other assets
Asset Derivatives
Asset Derivatives	[1]	35,370	13,452
Fuel swaps | Designated as Hedging Instrument | Derivative financial instruments
Asset Derivatives
Asset Derivatives	[1]	145,456	31,919
Liability Derivatives
Liability Derivatives	[1]	0	7,944
Fuel swaps | Designated as Hedging Instrument | Other long-term liabilities
Liability Derivatives
Liability Derivatives	[1]	0	1,202
Fuel swaps | Not Designated as Hedging Instrument | Other assets
Asset Derivatives
Asset Derivatives		0	102
Fuel swaps | Not Designated as Hedging Instrument | Derivative financial instruments
Asset Derivatives
Asset Derivatives		16,831	8,430
Liability Derivatives
Liability Derivatives		16,682	3,264
Fuel swaps | Not Designated as Hedging Instrument | Other long-term liabilities
Liability Derivatives
Liability Derivatives		$ 0	$ 1,211

[1] Accounting Standard Codification 815-20 “Derivatives and Hedging.”

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Fair Value Measurements and Derivative Instruments - Income Statement Hedging Instruments (Details) - Fair Value Hedging - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Derivative Instruments
Amount of Gain (Loss) Recognized in Income on Derivative	$ (3,365)	$ (552)
Amount of Gain (Loss) Recognized in Income on Hedged Item	6,024	2,930
Interest rate swaps | Interest expense (income), net of interest capitalized
Derivative Instruments
Amount of Gain (Loss) Recognized in Income on Derivative	(3,365)	(552)
Amount of Gain (Loss) Recognized in Income on Hedged Item	$ 6,024	$ 2,930

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Fair Value Measurements and Derivative Instruments - Balance Sheet Hedging Instruments (Details) - Foreign currency debt - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2022	Dec. 31, 2021
Derivative Instruments
Carrying value of non-derivative instrument designated as hedging instrument	$ 110,103	$ 110,313
Current portion of debt
Derivative Instruments
Carrying value of non-derivative instrument designated as hedging instrument	64,938	75,518
Long-term debt
Derivative Instruments
Carrying value of non-derivative instrument designated as hedging instrument	$ 45,165	$ 34,795

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Fair Value Measurements and Derivative Instruments - Designated Cash Flow Hedges (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021	Dec. 31, 2021
Effect of derivative instruments involved in hedging on the consolidated financial statements
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives	$ 224,619	$ (927)
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net [Abstract]
Net inception fair value at January 1, 2022			$ (554)
Amount of gain recognized in income on derivatives for the period ended March 31, 2022	577
Amount of gain (loss) remaining to be amortized in accumulated other comprehensive loss, as of March 31, 2022	(39)
Fair value at March 31, 2022	(16)
Interest rate swaps
Effect of derivative instruments involved in hedging on the consolidated financial statements
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives	74,865	43,408
Foreign currency forward contracts
Effect of derivative instruments involved in hedging on the consolidated financial statements
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives	(40,062)	(99,581)
Fuel swaps
Effect of derivative instruments involved in hedging on the consolidated financial statements
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Loss on Derivatives	$ 189,816	$ 55,246

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Fair Value Measurements and Derivative Instruments - Non-Derivative Net Investment (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Foreign currency debt
Net investment hedge
Amount of Gain (Loss) Recognized in Other Comprehensive Loss	$ 2,745	$ 5,822

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Fair Value Measurements and Derivative Instruments - Derivatives Not Designated as Hedging Instruments (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Derivative Instruments
Amount of Gain (Loss) Recognized in Income on Derivatives	$ (6,992)	$ (843)
Foreign currency forward contracts | Other income (expense)
Derivative Instruments
Amount of Gain (Loss) Recognized in Income on Derivatives	(6,985)	(13,498)
Fuel swaps | Other income (expense)
Derivative Instruments
Amount of Gain (Loss) Recognized in Income on Derivatives	$ (7)	$ 12,655

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Fair Value Measurements and Derivative Instruments - Credit Features (Details) $ in Millions	3 Months Ended
	Mar. 31, 2022 USD ($) derivative
Derivative Instruments
Number of interest rate derivative hedges requiring collateral to be posted | derivative	6
Debt instrument, collateral amount	$ 117.2
Interest Contracts
Derivative Instruments
Debt instrument, collateral amount	$ 16.7
Derivative term	5 years