UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant To Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of report (Date of earliest event reported): October 13, 2020

Registrant's telephone number, including area code: 305-539-6000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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.  ¨

Item 7.01 Regulation FD Disclosure.

On October 13, 2020, in connection with the Offerings (defined below), Royal Caribbean Cruises Ltd. (the “Company”) is distributing certain information, reproduced below, to potential investors.

COVID-19

The disruptions to our operations resulting from the COVID-19 pandemic (“COVID-19”) have had, and continue to have, a material negative impact on our financial condition and results of operations. The outbreak of COVID-19 has resulted in an unprecedented global response to contain the spread of the disease. These global efforts have resulted in travel restrictions and created significant uncertainty regarding worldwide port closures and availability. As part of the global containment effort, we previously announced a voluntary suspension of our four global cruise brands’ operations: Royal Caribbean International, Celebrity Cruises, Azamara and Silversea Cruises (collectively, our “Global Brands”) effective March 13, 2020, which has been extended through at least November 30, 2020, excluding sailings from Hong Kong. In addition, although Royal Caribbean International has received approval from the Singapore Government to pilot cruises starting in December 2020, Royal Caribbean International will be suspending all sailings departing from Australia and New Zealand on or before December 31, 2020. Celebrity Cruises will also be suspending their full 2020/21 Winter program in Australia and Asia. Additionally, Azamara will be suspending their 2020/21 Winter sailings throughout Australia and New Zealand, South Africa and South America. In connection with these suspensions, we have repatriated over 44,000 crew members to their home countries around the globe. Containment efforts as a result of the disease and continued disruptions to travel and port operations in various regions may result in further suspensions.

We have been developing a comprehensive and multi-faceted program to address the unique public health challenges posed by COVID-19. This includes, among other things, enhanced screening, upgraded cleaning and disinfection protocols and plans for social distancing. Together with Norwegian Cruise Line, we recently established a “Healthy Sail Panel (HSP)” made up of leading experts in relevant fields, including epidemiology, infectious diseases, public policy and regulation, engineering and general health safety to advise us in our effort to establish and implement appropriate safety protocols. We are working with the Centers for Disease Control and Prevention (“CDC”), the White House Coronavirus Task Force, global public health authorities and national and local governments to enhance measures to protect the health, safety and security of guests, crew and the communities visited while we are out of service and once operations resume. We are currently waiting for approval from the CDC to respond to the recommendations that are described below, and to confirm whether there will be future extensions of their previous “no sail” order that has most recently been extended to October 31, 2020. We have not been notified by the CDC of any intention to extend the current “no sail” order beyond the current specified outside date of October 31, 2020, and we currently have no further information as to when the CDC will respond to our recommendations or make any announcement. Such responses will determine the timing and implementation of our plans to return to service which we expect to be gradual, and, with certain limited exceptions, including those described above, to include commercial sailings commencing no earlier than December 1, 2020. Based on the status of our discussions with the CDC and all recent communications with respect to our submitted plan, including consideration of the “no sail” order, as well as the best information available to us as of the date of this prospectus supplement, we remain optimistic that we will be able to commence commercial sailings in 2020; however, we can provide no assurance that we will be able to return to service within such timeframe.

Update on Bookings

Our bookings for 2021 have continued to improve over the last two months, although still below pre-COVID-19 levels. Pricing for 2021 bookings is relatively flat year-over-year when including the negative yield impact of bookings made with future cruise credits; it is slightly up year-over-year when excluding them. We have implemented various programs to best serve our booked guests providing the choice of future cruise credits (“FCCs”) or the opportunity to “Lift & Shift” their booking to the same sailing the following year in lieu of providing cash refunds.

As of June 30, 2020, the Company had approximately $1.8 billion in customer deposits. The Company believes that the customer deposits balance is not materially different as of September 30, 2020 as compared to the June 30, 2020 balance. Approximately 50% of the guests booked on cancelled sailings have requested cash refunds.

Update on Healthy Sail Panel Recommendations

On September 21, 2020, the HSP submitted its recommendations to the CDC in response to a CDC request for public comment that will be used to inform future public health guidance and preventative measures relating to travel on cruise ships. The HSP’s 65-plus-page report includes 74 detailed best practices to protect the public health and safety of guests, crew and the communities where cruise ships call. Recommendations include testing, the use of face coverings, and enhanced sanitation procedures on ships and in terminals.

The HSP identified five areas of focus every cruise operator should address to improve health and safety for guests and crew, and reduce the risk of infection and spread of COVID-19 on cruise ships:

In each category, the HSP created practical and actionable recommendations to address specific safety concerns. Among the recommendations are key strategies such as:

We expect the CDC’s response to the HSP’s recommendations, as well as the responses of other authorities around the globe, to inform the development of new, detailed operating protocols which will represent an important milestone in the process of resuming sailing around the world. Based on the HSP’s recommendations, we plan to implement a comprehensive set of health and safety measures at every step of the guest journey with rigorous protocols, while continuing to deliver on our brands’ leading vacation experiences. We are also designing itineraries where we will be able to control the vacation experience under the health and safety protocols.

Beyond the health and safety protocols, our resumption of operations will include a staggered return of the fleet to service, including:

Update on Recent Liquidity Actions and Ongoing Uses of Cash

As of September 30, 2020, we had liquidity of approximately $3.7 billion, including $3.0 billion in the form of cash and cash equivalents and a $0.7 billion commitment for a 364-day term loan. Our cash burn rate for the third quarter was consistent with our previously announced range of approximately $250 million to $290 million per month during a prolonged suspension of operations, when excluding cash refunds of customer deposits, commissions, cash inflows from new and existing bookings and fees and collateral postings related to our financing and hedging activities. In response to the financial impacts of COVID-19, we have taken preemptive actions that focus on strengthening liquidity through significant cost and capital expenditure reductions, cash conservation and additional financing sources, as described below.

Reduced Operating Expenses

We have taken significant actions to reduce our operating expenses during the suspension of our global cruise operations. In particular, we:

We may seek to further reduce our average monthly expenses under a further prolonged non-revenue scenario. This includes consideration of additional vessels heading to cold layup as well as further assessment of our US shoreside workforce, including those coming back from furlough.

Reduced Capital Expenditures

Since the start of February 2020, we have identified approximately $4.4 billion of capital expenditure reductions or deferrals in 2020 and 2021. The reductions or deferrals of capital expenditures comprise the following:

COVID-19 has impacted shipyard operations which has resulted in delivery delays of ships previously planned for delivery in 2020 and 2021. Of five ships originally scheduled for delivery between July 2020 and December 2021, we expect that Silver Moon, Silver Dawn and Odyssey of the Seas will be delivered within the planned time frame. The exact duration of the ship delivery delays is currently under discussion with the impacted shipyards.

Debt Maturities, New Financings and Other Liquidity Actions

Since the start of February 2020, we have taken several additional actions to further improve our liquidity position and manage cash flow. In particular, we:

Expected debt maturities for the remainder of 2020 and 2021 are $0.3 billion and $1.3 billion, respectively. We estimate our cash burn to be, on average, in the range of approximately $250 million to $290 million per month during a prolonged suspension of operations. This range includes all interest expenses, including the increases driven by the latest capital raises (other than any interest expense related to the Convertible Notes Offering). It also includes ongoing ship operating expenses, administrative expenses, hedging costs, expected necessary capital expenditures (net of committed financings in the case of newbuilds) and excludes cash refunds of customer deposits, commissions, debt obligations and cash inflows from new and existing bookings. We are considering ways to further reduce the average monthly cash burn under a further prolonged out-of-service scenario and during re-start of operations.

We continue to identify and evaluate further actions to improve our liquidity. These include and are not limited to: further reductions in capital expenditures, operating expenses and administrative costs and additional financings.

Both our export credit agency (“ECA”) facilities and non-ECA bank 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%. Certain facilities also include a minimum stockholder’s equity covenant. In the second quarter of 2020, the requisite lenders under such facilities agreed to waive the requirement to comply with such financial covenants through and including the first quarter of 2021. With respect to certain of these facilities, we agreed to additional covenants during the covenant waiver period, including that we maintain at least $300 million in unrestricted cash and cash equivalents (tested monthly) and that we are not permitted during the covenant waiver period, subject to limited exceptions, to pay cash dividends or make share repurchases unless we would have been compliant with our fixed charge coverage ratio at such time. Subsequent to June 30, 2020, we further amended our export facilities and certain of our non-ECA facilities, to extend the financial covenant waiver through and including, the fourth quarter of 2021. In connection therewith, we increased the minimum liquidity covenant to $500 million, as applicable, subject to reduction in the event of further capital raises, and extended the dividend and share repurchase restrictions through the new waiver period.

Certain of the underwriters and initial purchasers and/or certain of their affiliates are agents and/or lenders under certain of our credit facilities, including certain of our ECA facilities and non-ECA bank facilities as described in the preceding paragraph.

Pullmantur Reorganization

On June 22, 2020, Pullmantur S.A, a subsidiary of Pullmantur Holdings S.L. (“Pullmantur Holdings”), in which we own a 49% non-controlling interest, filed for reorganization under the terms of the Spanish insolvency laws due to the negative impact of the COVID-19 pandemic on their operations. Subsequently, Pullmantur Holdings and certain of its other subsidiaries filed for reorganization in Spain. The Pullmantur brand has cancelled all of its ship operations until, at least, November 15, 2020. We suspended equity method accounting for Pullmantur Holdings during the second quarter of 2020.

Risks Relating to our Business

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

We have been, and will continue to be, negatively impacted by the COVID-19 pandemic, including impacts that resulted from actions taken in response to the outbreak. Examples of these include, but are not limited to, travel bans and cruising advisories and the resulting temporary suspension of our Global Brands' operations, which is expected to continue until at least November 30, 2020, excluding sailings from Hong Kong, and December 31, 2020 or the end of the 2020/21 Winter program with respect to certain countries such as Australia and New Zealand, 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 imposed 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 still rapidly fluctuating and difficult to predict. As such, these impacts may persist for an extended period of time or even become more pronounced, even after we are permitted to and/or begin to resume operations.

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

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

Disease outbreaks and increased concern related to illness when travelling 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. Due to the complex and evolving nature of the COVID-19 pandemic we cannot predict the duration of the effect of the current pandemic, and the magnitude is dependent on the development of future events and responses from governments, other authorities, and individual consumers. 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 and we may be subject to concerns that cruises are susceptible to the spread of infectious diseases such as COVID-19. For example, local governments may establish their own set of rules for self-quarantines and/or require proof of individuals health status prior to or upon visiting. These effects may extend beyond any resolution of the current COVID-19 pandemic through the development of a vaccine or effective therapeutic treatment, and 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 COVID-19 or other infectious diseases may be costly to implement and less effective than we expected in reducing the risk of infection and spread of such disease on our cruise ships, which will negatively impact our operations and expose us to reputational and legal risks.

The information in this Item 7.01 is deemed “furnished” and not “filed” under Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 8.01 Other Events.

Equity Offering and Convertible Notes Offering

On October 13, 2020, the Company issued press releases announcing that the Company has commenced an underwritten public offering of shares of common stock, par value $0.01 per share, of the Company (the “Equity Offering”) and a concurrent private offering of senior convertible notes (the “Convertible Notes”) to be issued by the Company due 2023 (the “Convertible Notes Offering” and, collectively with the Equity Offering, the “Offerings”). The closing of each offering is not contingent upon the closing of the other offering. A copy of the press release announcing the Equity Offering is attached hereto as Exhibit 99.1 and a copy of the press release announcing the Convertible Notes Offering is attached hereto as Exhibit 99.2, and each such press release is incorporated by reference herein.

The Company expects to use a portion of the net proceeds from the Convertible Notes Offering to repay its 2.650% Senior Notes due 2020, with the remainder to be used for general corporate purposes. The Company expects to use the net proceeds from the Equity Offering for general corporate purposes.

The Convertible Notes are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act. The Convertible Notes will not be registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.

This Current Report on Form 8–K shall not constitute an offer to sell or a solicitation of an offer to buy shares of common stock, the Convertible Notes or any other securities, and shall not constitute an offer, solicitation or sale in any jurisdiction in which such an offer, solicitation or sale would be unlawful.

Cautionary Statement Concerning Forward-Looking Statements

Certain statements in this Current Report on Form 8-K relating to, among other things, our future performance estimates, forecasts and projections constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to: statements regarding revenues, costs and financial results for 2020 and beyond. Words such as “anticipate,” “believe,” “could,” “driving,” “estimate,” “expect,” “goal,” “intend,” “may,” “plan,” “project,” “seek,” “should,” “will,” “would,” “considering”, and similar expressions are intended to help identify forward-looking statements. Forward-looking statements reflect management’s current expectations, are based on judgments, are inherently uncertain and are subject to risks, uncertainties and other factors, which 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 the following: the impact of the global incidence and spread of COVID-19, which has led to the temporary suspension of our operations and has had and will continue to have a material adverse impact on our business, liquidity and results of operations, or other contagious illnesses on economic conditions and the travel industry in general and the financial position and operating results of our Company in particular, such as: the current and potential additional governmental and self-imposed travel restrictions, the current and potential extension of the suspension of cruises and new additional suspensions, guest cancellations; our ability to obtain sufficient financing, capital or revenues to satisfy liquidity needs, capital expenditures, debt repayments and other financing needs; the effectiveness of the actions we have taken to improve and address our liquidity needs; the impact of the economic and geopolitical environment on key aspects of our business, such as the demand for cruises, passenger spending, and operating costs; incidents or adverse publicity concerning our ships, port facilities, land destinations and/or passengers or the cruise vacation industry in general; concerns over safety, health and security of guests and crew; further impairments of our goodwill, long-lived assets, equity investments and notes receivable; an inability to source our crew or our provisions and supplies from certain places; the incurrence of COVID-19 and other contagious diseases on our ships and an increase in concern about the risk of illness on our ships or when traveling to or from our ships, all of which reduces demand; unavailability of ports of call; growing anti-tourism sentiments and environmental concerns; changes in US foreign travel policy; the uncertainties of conducting business internationally and expanding into new markets and new ventures; our ability to recruit, develop and retain high quality personnel; changes in operating and financing costs; our indebtedness, any additional indebtedness we may incur and restrictions in the agreements governing our indebtedness that limit our flexibility in operating our business, including the significant portion of assets that are collateral under these agreements; the impact of foreign currency exchange rates, interest rate and fuel price fluctuations; the settlement of conversions of our convertible notes, if any, in shares of our common stock or a combination of cash and shares of our common stock, which may result in substantial dilution for our existing shareholders; our expectation that we will not declare or pay dividends on our common stock for the near future; vacation industry competition and changes in industry capacity and overcapacity; the risks and costs associated with protecting our systems and maintaining integrity and security of our business information, as well as personal data of our guests, employees and others; the impact of new or changing legislation and regulations or governmental orders on our business; pending or threatened litigation, investigations and enforcement actions; the effects of weather, natural disasters and seasonality on our business; emergency ship repairs, including the related lost revenue; the impact of issues at shipyards, including ship delivery delays, ship cancellations or ship construction cost increases; shipyard unavailability; the unavailability or cost of air service; and uncertainties of a foreign legal system as we are not incorporated in the United States.

In addition, many of these risks and uncertainties are currently heightened by and will continue to be heightened by, or in the future may be heightened by, the COVID-19 pandemic. It is not possible to predict or identify all such risks.

The forward-looking statements included in this Current Report on Form 8-K speak only as of the date of this Current Report on Form 8-K. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Except as required by law, we undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. You should consider the areas of risk described above, as well as those set forth under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019, as updated by our Current Report on Form 8-K filed on May 13, 2020, those set forth under the heading “Risk Factors” in our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020 and June 30, 2020, copies of which may be obtained by visiting our Investor Relations website at www.rclinvestor.com or the SEC’s website at www.sec.gov.

Item 9.01 Financial Statements and Exhibits.

(d)  Exhibits

Exhibit 99.1 – Press release dated October 13, 2020

Exhibit 99.2 – Press release dated October 13, 2020.

Exhibit 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).

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 hereunto duly authorized.