LINDBLAD EXPEDITIONS HOLDINGS, INC. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Under the supervision and with the participation of our principal executive officer and principal financial officer, our management conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), means controls and other procedures of a company that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the rules and forms of the Securities and Exchange Commission (“SEC”). Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the company’s management, including its principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosure. Based on that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of December 31, 2023. Management ’ s Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Our internal control over financial reporting is a process designed 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 (“GAAP”). Our internal control over financial reporting includes those policies and procedures that: (1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that our receipts and expenditures are being made only in 52 accordance with authorizations of our management and our directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, assessed the effectiveness of our internal control over financial reporting, as of December 31, 2023, using the criteria described in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the evaluation under the updated internal control framework in Internal Control-Integrated Framework (2013), management concluded that our internal control over financial reporting was effective as of December 31, 2023. The effectiveness of our internal control over financial reporting as of December 31, 2023 has been audited by Ernst & Young LLP, an independent registered public accounting firm, as stated in their report which appears in Item 9A of this Annual Report on Form 10-K. Changes in Internal Control Over Financial Reporting There was no change in the internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. Inherent Limitations on Effectiveness of Controls We do not expect that our disclosure controls and procedures or our internal controls will prevent all error and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected. 53 Report of Independent Registered Public Accounting Firm To the Stockholders and the Board of Directors of Lindblad Expeditions Holdings, Inc. Opinion on Internal Control Over Financial Reporting We have audited Lindblad Expeditions Holdings, Inc. and subsidiaries internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Lindblad Expeditions Holdings, Inc. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the 2023 consolidated financial statements of the Company and our report dated March 6, 2024 expressed an unqualified opinion thereon. Basis for Opinion The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed 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. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Hartford, Connecticut March 6, 2024 54 Item 9B. Other Information Rule 10b5 - 1 Trading Plans Directors and Executive Officers. Our directors and executive officers may purchase or sell shares of our common stock in the market from time to time, including pursuant to equity trading plans adopted in accordance with Rule 10b5 - 1 under the Exchange Act (“Rule 10b5 - 1” ) and in compliance with guidelines specified by the Company. In accordance with Rule 10b5 - 1 and the Company’s insider trading policy, directors, officers and certain employees who, at such time, are not in possession of material non-public information about the Company are permitted to enter into written plans that pre-establish amounts, prices and dates (or formula for determining the amounts, prices and dates) of future purchases or sales of the Company’s common stock, including shares acquired pursuant to the Company’s equity plans (“Rule 10b5 - 1 Trading Plans”). Under a Rule 10b5 - 1 Trading Plan, a broker executes trades pursuant to parameters established by the director or executive officer when entering into the plan, without further direction from them. The following table describes contracts, instructions or written plans for the sale or purchase of our securities adopted, terminated or modified by our directors and executive officers during the three months ended December 31, 2023, each of which is intended to satisfy the affirmative defense conditions of Rule 10b5 - 1 (c). Name and Title Adoption, Termination or Modification Date of Adoption, Termination or Modification Scheduled Expiration Date of Plan Number of Shares to be Purchased under the Plan Alex P. Schultz ( Director ) Adoption December 19, 2023 April 18, 2025 218,676 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 55 PART III Item 10. Directors, Executive Officers and Corporate Governance Our Board Directors Mark D. Ein , age 59, has served as our Chair of the Board and a Director since March 2013, and previously served as our Chief Executive Officer, Treasurer and Secretary prior to the business combination with Lindblad Expeditions, Inc. in July 2015. Mr. Ein is an investor, entrepreneur and philanthropist, who has created, acquired, invested in and built a series of growth companies across a diverse set of industries over the course of his 30-year career. During this time, Mr. Ein has been involved in the founding or early stages of six companies that have been worth over one billion dollars and has led over $3 billion of private equity, venture capital and public company investments. Mr. Ein is the Founder, Chairman and CEO of investment firms Capitol Investment Corp, Leland Investment Corp and Venturehouse Group that both create, invest in and build growth businesses in a range of industries. Among the current majority-owned companies in the portfolios are Kastle Systems, the country's leading provider of proptech and security systems for commercial real estate, where he serves as Executive Chairman. Mr. Ein is currently also a member of the board of Soho House & Company. (NYSE:SHCO) and Custom Truck One Source, Inc. (NYSE:CTOS). Previously, Mr. Ein served as vice-chairman on the board of Cision, from July 2017 to February 2020, and on the board of Doma Holdings, Inc. from May 2021 to January 2023. In February, 2023, Mr. Ein was nominated by President Biden to be Chairman of his President’s Export Council. In July 2023, Mr. Ein was one of the founding partners that helped lead the acquisition of the Washington Commanders NFL franchise. Mr. Ein is also the Founder and Owner of MDE Sports, which owns the Mubadala Citi DC Open tennis tournament in Washington, D.C. (the world’s first and only combined ATP/WTA 500 tennis tournament), the Washington Justice esports franchise in the Overwatch League, and the Washington City Paper, the renowned local media company serving the Washington, D.C. metropolitan area since 1981. A native of the Washington area, he actively supports many community, charitable and cultural organizations and currently serves on the boards of the DC Public Education Fund (as Chairman since 2010, the Fund has raised $200 million of philanthropic support for D.C. Public Schools), DC College Access Program (DC-CAP), and DC Policy Center (Co-Founder). He currently serves as a Presidential Appointee to the Board of the United States Tennis Association (USTA), having previously served on the board from 2012-2018 (serving as a Vice President of the Board from 2016-2018). Mr. Ein has been a member of the World Economic Forum since 2016, and the Gridiron Club, the oldest and one of the most prestigious journalistic organizations in Washington, DC. He has won numerous awards, including the Washington Business Hall of Fame, Washington, D.C. Business Leader of the Year from the Chamber of Commerce in 2011 and 2019, the Jefferson Award (the nation’s highest honor for public service), Washington Business Journal Top Corporation for Philanthropy (Small Companies), Washington Business Journal Power 100, Entrepreneur of the Year Awards from Ernst and Young and the National Foundation for Teaching Entrepreneurship (NFTE). In September 2009, Washington, D.C. Mayor Adrian Fenty presented Mr. Ein with the Key to the City, highlighting his Washington Kastles success on the court and, “for their commitment to the District’s communities and our youth.” Prior to starting his firm, Mr. Ein worked for The Carlyle Group, Brentwood Associates, and Goldman Sachs. He received a B.S. in Economics with a concentration in finance from the Wharton School of the University of Pennsylvania and his M.B.A. from the Harvard Business School.  We consider Mr. Ein well-qualified to serve as a member of the Board due to his public company experience, business leadership and operational experience. Sven-Olof Lindblad , age 73, founded Lindblad and had been its President and Chief Executive Officer since its inception through May 2021, before returning to the role in July 2023. Mr. Lindblad has served as our Director since July 2015 and was Co-Chair of the Board from March 2021 through July 2023. Mr. Lindblad’s travel background and familiarity with adventure travel and wildlife dates back to his childhood and traveling with his father, Lars-Eric Lindblad. Mr. Lindblad founded Lindblad in order to offer innovative and educational travel expeditions to the world’s most remarkable places, capturing the true spirit of adventure. His commitment to environmentally responsible travel and ocean advocacy drives the company’s innovation and leadership in the expedition travel category. He is an honorary member of the General Assembly of the Charles Darwin Foundation for the Galapagos 56 Islands; serves on the Board of The Safina Center, and on the Board of Trustees of RARE; is a founding member of the non-profit, Ocean Elders, and serves on the Board of Advisors for Pristine Seas, and previously served on the National Geographic Society’s International Council of Advisors. We consider Mr. Lindblad well-qualified to serve as a member of the Board due to his extensive expedition travel and experience, his business leadership, public company and operational experience. Bernard W. Aronson , age 77, has served as a Director since July 2015. Mr. Aronson is currently Founding Partner of ACON Investments, L.L.C., a middle market private equity group. He served as the U.S. Special Envoy to the Colombian Peace Process, appointed by former President Obama in February 2015. His distinguished career has included positions in the private and government sectors, including international advisor to Goldman Sachs & Co. from 1993 to 1996; Assistant Secretary of State for Inter-American Affairs from 1989 to 1993 where he was presented with the State Department’s highest honor, the Distinguished Service Award, for his role in ending the conflicts in Central America, and again for ending the conflict in Colombia; and several White House positions under the Carter Administration. Mr. Aronson previously served as a director of Royal Caribbean Cruises Ltd. from 1993 until 2015, and also has served as a director of Kate Spade & Co., Hyatt Hotels Corporation and Northern Tier Energy LP, in addition to several private companies. He serves on several non-profit boards, including The Amazon Conservation Team and the National Democratic Institute for International Affairs, and is a member of the Council on Foreign Relations. He graduated with Honors from the University of Chicago. We consider Mr. Aronson well-qualified to serve as a member of the Board due to his prior experience as a member of the Board of Directors of Royal Caribbean Cruises Ltd. and his extensive business experience. Elliott Bisnow , age 38, has served as a Director since December 2017. Mr. Bisnow, is a prominent American entrepreneur who has founded multiple businesses in a career that has spanned 20 years. Mr. Bisnow is best known as the founder of the events company Summit Series and as an early investor in house hold names like Uber, Coinbase, and Warby Parker. From 2013 to 2023, Mr. Bisnow was a co-owner of Powder Mountain, America's largest ski resort, until its sale. In 2006, Mr. Bisnow co-founded Bisnow Media with his father, Mark Bisnow. Over the next decade, the company transformed into the largest commercial real estate media and events business in North America and sold the company in 2016. Mr. Bisnow's insights and experiences are also shared in his book, “Make No Small Plans,” offering valuable lessons and strategies for aspiring entrepreneurs. We consider Mr. Bisnow well-qualified to serve as a member of the Board due to his background in experience-based businesses and his business leadership. Alexander P. Schultz, age 41, has served as a Director since February 2022. Mr. Schultz currently serves as Chief Marketing Officer and VP of Analytics for Meta, formerly Facebook, where he leads consumer marketing and product analytics globally. Throughout his career with Meta, he has pioneered the integration of product and direct response marketing and has been responsible for some of the largest, most effective online direct response campaigns, which have resulted in tremendous application user growth. Mr. Schultz has been with Meta since 2007 and has led the internationalization team since 2011 and the analytics team since 2015. Prior to joining Meta, Mr. Schultz was a Marketing Manager at eBay, during which time he led global targeting for eBay’s onsite merchandising, among other responsibilities. Mr. Schultz received a M.S. in Natural Sciences from Magdalene College, Cambridge where he specialized in experimental and theoretical Physics. We consider Mr. Schultz well-qualified to serve as a member of the Board due to his extensive product marketing experience and his business leadership. Thomas S. (Tad) Smith, Jr., age 58, has served as a Director since March 2020. Mr. Smith is currently the Managing Member of Durable Money LLC, a private investment and advisory firm, which he has co-owned and operated since March 2020. Since June 2023, he has also been a general partner of 1RoundTable Partners, a global growth equity firm that invests in and nourishes companies deploying blockchain technologies in innovative ways to create value, as well as a partner in 10T Holdings, and other predecessor funds. Since September 2023, he has also served as Chairman of the Board of The Fine Art Group, the leading art advisory and art financing firm based in London. Prior to these roles, Mr. Smith served as the CEO of a privately owned home care company called The Key. The company, which he served from November 2020 until July 2023, provides a suite of private pay services to the elderly that make it possible for them to live safely and independently in their own homes throughout the United States, Canada and Australia. 57 Prior to this, Mr. Smith served as a member of the board of Capitol Investment Corp V from October 2020, but stepped down in July 2021 after the successful merger with real estate tech company, DOMA. Prior to that, Mr. Smith was the President and CEO of the NYSE-listed global auction house Sotheby’s, serving from March 2015 through October 2019, when he successfully digitized, expanded, modernized, and then sold the company in a multibillion dollar transaction. From February 2014 to March 2015, Mr. Smith was President and CEO of The Madison Square Garden Company, a publicly-traded, diversified cable media, live entertainment, and sports company that included the New York Knicks and the New York Rangers. From 2009 to 2014, Mr. Smith served as President, Local Media (later adding responsibility for Cablevision Media Sales), of the New York metro area cable operator Cablevision, which was controlled by the same shareholder as The Madison Square Garden Company. From 2000 to 2009, he worked for the worldwide media company now known as RELX, where he last served as chief executive officer of the US business-to-business division, Reed Business Information. In that capacity, he oversaw and digitized more than 100 magazines and data businesses including Variety, Interior Design, Publishers Weekly, Broadcasting & Cable, and the like. Since 1999, he has served as an adjunct professor at the Stern School of Business at New York University, where he teaches a highly rated finance and strategy class to MBAs. He is a board member of the private adtech company Simulmedia, based in New York, and a board observer for Dallas-based e-commerce company, Verishop. Mr. Smith is a board member of Futureverse and Doodles and Qredo and Blockworks as well as a board observer of Candy Digital: all companies in which his 1RoundTable Partners or 10T Holdings has an interest. Finally, he is a board member of Julien’s Auction House in Los Angeles. Mr. Smith serves on the board of governors of the Alzheimer’s Drug Discovery Foundation, the Palm Beach Civic Association, and the Preservation Foundation of Palm Beach. He serves on the advisory board of the Hospital for Special Surgery and the Chairman’s Council of the Norton Museum of Art. He is member of the Council on Foreign Relations and also the YPO Palm Beach Gold Chapter as well as La Confrerie des Chevaliers du Tastevin of Palm Beach. He received a Master of Business Administration from Harvard Business School, where he was a George F. Baker Scholar and a Horace W. Goldsmith Fellow. He received a Bachelor of Arts from Princeton University’s School of Public and International Affairs, where he received the R.W. Van de Velde Award. We consider Mr. Smith well-qualified to serve as a member of the Board due to his public company experience and business leadership. L. Dyson Dryden , age 48, has served as a Director since March 2013, and previously served as our Chief Financial Officer prior to our business combination with Lindblad Expeditions, Inc. in July 2015. Mr. Dryden has served as a Managing Partner of Black Diamond Financial, LLC since February 2013. He is also founder of Dryden Capital Management, a private investment firm that invests in and builds private companies, and has served as its President since March 2013. Mr. Dryden is Vice Chairman of CDS Logistics Management, Inc., one of the largest providers of home improvement product delivery services in the United States. In 2018, he co-founded Washington E-Sports Ventures and currently serves on its Board. Mr. Dryden has served as President, Chief Financial Officer and a director of Capitol Investment Corp. V from May 2017 until the completion of its $3 billion business combination with Doma in July 2021. Mr. Dryden served as President, Chief Financial Officer and a director of Capitol Investment Corp. IV from July 2017 until the completion of its $1.1 billion business combination with Nesco in July 2019 and served as Co-Chairman of Nesco Holdings, Inc. until the April 2021 closing of the $1.5 billion acquisition of Custom One Truck Source. From July 2015 until it completed its $2.4 billion business combination with Cision in June 2017, Mr. Dryden was the President, Chief Financial Officer, Treasurer, Secretary and a Director of Capitol III. Mr. Dryden continued to serve as a director of Cision Ltd. until January 2020. From August 2005 to February 2013, Mr. Dryden worked in Citigroup’s Investment Banking division in New York, most recently as a Managing Director where he led the coverage effort for a number of the firm’s Global Technology, Media and Telecommunications clients. From 2000 to 2005, Mr. Dryden held the titles of Associate and Vice President at Jefferies & Company, a global investment bank. From 1998 to 2000, Mr. Dryden worked in the investment banking group at BB&T Corporation. Mr. Dryden serves on the Board of Trustees for The Johns Hopkins Hospital and Calvert School. He holds a B.S. in Business Administration with a dual concentration in finance and management from the University of Richmond. 58 We consider Mr. Dryden well-qualified to serve as a member of the Board due to his finance and capital markets knowledge and experience. John M. Fahey , age 72, has served as a Director since July 2015. Mr. Fahey served as Chairman of the National Geographic Society from January 2011 to February 2016, where he was also Chief Executive Officer from March 1998 to December 2013 and President from March 1998 to December 2010. During his tenure as President and Chief Executive Officer, Mr. Fahey led the Society’s entry into cable television with the National Geographic Channels; the international growth of National Geographic magazine; and the extension of National Geographic content into digital media. Mr. Fahey joined National Geographic in April 1996, as the first President and Chief Executive Officer of National Geographic Ventures. Prior to that, he was Chairman, President and Chief Executive Officer of Time Life Inc., a wholly-owned subsidiary of Time Warner Inc., for seven years. He worked previously for Home Box Office, Inc. where he was instrumental in the startup of Cinemax. Mr. Fahey is Vice-Chair of the Smithsonian Institution’s Board of Regents. He also serves on the board of Johnson Outdoors Inc., where he is the Vice Chair and Lead Independent Director, Chair of the nominating and corporate governance committee and a member of the compensation committee. Mr. Fahey was previously Non-Executive Chairman of Time Inc. Mr. Fahey received his bachelor’s degree in engineering from Manhattan College and his master’s degree in business administration from the University of Michigan. In 2008, he received the David D. Alger Alumni Achievement Award from the University of Michigan’s Ross School of Business. We consider Mr. Fahey well-qualified to serve as a member of the Board due to his relationship with the National Geographic Society and his business leadership. Catherine B. Reynolds , age 66, has served as a Director since May 2016. Mrs. Reynolds is a founder of EduCap Inc., which has provided more than $5.0 billion in education loans to hundreds of thousands of qualified students and families, and has been its Chair of the Board, Chief Executive Officer, and President since 1989. She is a successful business leader and social entrepreneur who currently devotes her time and abilities primarily to philanthropic pursuits through the Catherine B. Reynolds Foundation. In 2004, Mrs. Reynolds was selected by BusinessWeek magazine as one of the 50 most philanthropic living Americans and the first self-made woman to make their list. She is also the recipient of the Woodrow Wilson Award for Corporate Citizenship, bestowed annually on America’s most outstanding business leaders by the Woodrow Wilson International Center for Scholars. She is currently a director of General Dynamics Corporation, where she also serves on the audit committee, sustainability committee and is the Chair of the finance and benefit plan committee. She was Chair of the board of directors of Lyndra Therapeutics from 2017 to 2023. Mrs. Reynolds is co-founder and CEO of VitaKey Inc., a precision delivery technology that will unlock the science of nutrition. She is also a current or former trustee of a number of organizations including New York University, Vanderbilt University, Harvard Kennedy School’s Center for Public Leadership, the John F. Kennedy Center for the Performing Arts, and the American Academy of Achievement. Mrs. Reynolds started her career at the accounting firm of Arthur Young as a certified public accountant and is a graduate of Vanderbilt University. We consider Ms. Reynolds well-qualified to serve as a member of the Board due to her business leadership and financial background. Corporate Governance Board Composition Directors hold office for a term ending on the date of the third annual stockholders’ meeting following the annual meeting at which such director’s class was most recently elected until the earlier of their death, resignation, removal or until their successors have been duly elected and qualified. There are no family relationships among our directors. Our bylaws provide that the number of members of our Board of Directors may be changed from time to time by resolutions adopted by the Board of Directors provided that there shall not be less than one director nor more than ten directors. Our Board of Directors currently consists of nine members. Board Leadership Structure Our Board of Directors does not have a policy on whether the roles of Chief Executive Officer and Chairperson should be separate. Our Board reserves the right to assign the responsibilities of the Chief Executive Officer and Chairperson position(s) as determined by our Board to be in our best interest. In the circumstance where the responsibilities of the Chief Executive Officer and Chairperson are vested in the same individual or in other circumstances when deemed appropriate, the Board will designate a lead independent director from among the independent directors to preside at the meetings of the non-employee director executive sessions. 59 Currently, Mark D. Ein serves as our Chairperson of the Board. Our Board retains the authority to modify this structure to best address our unique circumstances as and when appropriate. Board Role in Risk Oversight Our full Board is responsible for the oversight of our operational risk management process. Our Board has assigned responsibility for addressing certain risks, and the steps management has taken to monitor, control and report such risk, to our audit committee with appropriate reporting to the full Board. Our Board relies on our Compensation Committee to address significant risk exposures facing us with respect to compensation. Our Compensation Committee will periodically conduct a review of our compensation policies and practices to assess whether any risks arising from such policies and practices are reasonably likely to materially adversely affect us. Board Role in Social and Environmental Risk Oversight Our full Board is responsible for the oversight of our social and environmental risk management process. Our Board has assigned responsibility for addressing certain risks, and the steps management has taken to monitor, control and report such risk, to our management team with appropriate reporting to the full Board. Our Board relies on our management team to address significant risk exposures facing us with respect to climate changes on our business and our business on the environment. Our management team will periodically conduct a review of our operating, and well as our diversity and hiring, policies and practices, to assess whether any risks arising from such policies and practices are reasonably likely to materially adversely affect us. Code of Conduct and Ethics We have adopted Codes of Business Conduct and Ethics that applies to our employees, including our principal executive officer, principal financial officer and persons performing similar functions, and our directors. Our codes of ethics and business conduct can be found posted in the investor relations sections on our website at http://investors.expeditions.com . None of the websites referenced in this Annual Report on or the information contained therein is incorporated herein by reference. Future material amendments or waivers relating to the Code of Ethics will be disclosed on our website referenced in this paragraph within four business days following the date of such amendment or waiver. Stockholder Communications Stockholders may send communications to our directors as a group or individually, by writing to those individuals or the group: c/o the Secretary, 96 Morton Street, 9th Floor, New York, NY 10014. The Secretary will review all correspondence received and will forward all correspondence that is relevant to the duties and responsibilities of the Board or our business to the intended director(s). Examples of inappropriate communication include business solicitations, advertising and communication that is frivolous in nature, relates to routine business matters or raises grievances that are personal to the person submitting the communication. Upon request, any director may review communication that is not forwarded to the directors pursuant to this policy. Committees of the Board of Directors Our Board of Directors currently has three standing committees: (i) a Nominating Committee, (ii) an Audit Committee and (iii) a Compensation Committee. Each of these Board committees described further below. Members of these committees are elected annually, generally at a Board meeting. The charters of our committees are available on the investor relations page of our website at www.expeditions.com . Non-Employee Board Committee Members Name Audit Committee Compensation Committee Nominating Committee Mr. Aronson - - M Mr. Bisnow - M - Mr. Dryden C M - Mr. Ein M M C Mr. Fahey - C M Ms. Reynolds M M - Mr. Schultz - - M Mr. Smith - - M __________ C-Chair M- Member 60 Nominating Committee The Nominating Committee is responsible for overseeing the selection of persons to be nominated to serve on our Board of Directors. The Nominating Committee considers persons identified by its members, management, stockholders, investment bankers, and others. Currently, the guidelines for selecting nominees, which are specified in the Nominating Committee charter, generally provide that persons to be nominated: ● should possess the requisite intelligence, education and experience to make a significant contribution to the Board of Directors and bring a range of skills, diverse perspectives and backgrounds to its deliberations; and ● should have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the stockholders. The Nominating Committee will consider a number of qualifications relating to management and leadership experience, background and integrity and professionalism in evaluating a person’s candidacy for membership on the Board of Directors. The Nominating Committee may require certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members. The Nominating Committee does not distinguish among nominees recommended by stockholders and other persons. Nominations of persons for election to the Board at the annual meeting may also be made by any stockholder entitled to vote for the election of directors at the meeting who complies with the notice procedures set forth in our bylaws. Such nominations by any stockholder shall be made pursuant to timely notice in writing to our Secretary at 96 Morton Street, 9th Floor, New York, NY 10014. To be timely, a stockholder’s notice shall be received by the Secretary at our principal executive offices not later than the close of business on the sixtieth (60th) day nor earlier than the close of business on the ninetieth (90th) day prior to the annual meeting; provided, however, that in the event that less than seventy (70) days’ notice or prior public disclosure of the date of the meeting is given or made to stockholders, notice by the stockholder, to be timely, must be received no later than the close of business on the tenth (10th) day following the day on which such notice of the date of the meeting was mailed or such public disclosure was made, whichever first occurs. Such stockholders’ notice to the Secretary must also include the information about the stockholder and the nominee as well as the other information required pursuant to our bylaws. Audit Committee Each of the members of the Audit Committee is independent under the applicable Nasdaq listing standards for Audit Committee members. The Board of Directors has determined that each of Messrs. Dryden, Ein and Ms. Reynolds satisfies Nasdaq’s definition of financial sophistication, and that each of Messrs. Dryden, Ein and Ms. Reynolds qualify as an “audit committee financial expert” as defined under rules and regulations of the Securities and Exchange Commission. The purpose of the Audit Committee is to appoint, retain, set compensation of, and supervise our independent accountants, review the results and scope of the audit and other accounting related services and review our accounting practices and systems of internal accounting and disclosure controls. The Audit Committee’s duties, which are specified in the audit committee charter, include, but are not limited to: ● reviewing and discussing with management and the independent auditor the annual audited financial statements, and recommending to the Board whether the audited financial statements should be included in our Form 10-K; ● discussing with management and the independent auditor significant financial reporting issues and judgments made in connection with the preparation of our financial statements; ● discussing with management major risk assessment and risk management policies; ● monitoring the independence of our independent auditor; ● verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law; ● reviewing and approving all related-party transactions; ● inquiring and discussing with management our compliance with applicable laws and regulations; ● pre-approving all audit services and permitted non-audit services to be performed by our independent auditor, including the fees and terms of the services to be performed; ● appointing or replacing the independent auditor; 61 ● determining the compensation and oversight of the work of the independent auditor (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work; and ● establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies. Compensation Committee The purpose of the Compensation Committee is to review and approve compensation paid to our officers and directors and to administer our incentive compensation plans. The Compensation Committee’s duties, which are specified in the Compensation Committee charter, include, but are not limited to: ● establishing compensation plans and compensation policy; ● approving compensation arrangements for senior management, including annual incentive and long-term compensation; ● reviewing leadership development and succession planning; and ● making grants under our equity incentive plans. The processes for consideration of executive compensation are discussed further under “Executive Compensation — Compensation Discussion and Analysis.” EXECUTIVE OFFICERS Certain information regarding our executive officers is provided below as of January 31, 2024: Name Age Position Sven-Olaf Lindblad 73 Chief Executive Officer and Director Craig I. Felenstein 51 Chief Financial Officer Noah Brodsky 43 Chief Commercial Officer Dean (Trey) Byus III 55 Chief Expedition Officer Benjamin L. Bressler 61 President, Natural Habitat, Inc. For information with respect to Mr. Lindblad, please see the information about the members of our Board of Directors on the preceding pages. There are no family relationships among our directors or executive officers. Craig I. Felenstein joined us as Chief Financial Officer in September 2016. Mr. Felenstein brings a long history of leadership positions in a wide range of public companies, most recently serving as the Senior Vice President of Investor Relations and Strategic Finance at Shutterstock, Inc. from March 2015 until September 2016, where he oversaw all interaction with the investment community while leading the financial planning and analysis and corporate development functions. Prior to Shutterstock, Inc., Mr. Felenstein was at Discovery Communications, LLC (“Discovery”), from May 2008 to March 2015, serving in various management roles, including Executive Vice President of Investor Relations, where he was responsible for building and directing the investor relations function. At the same time, he was part of the executive team for several of Discovery’s businesses, including serving as the Chief Financial Officer of Digital, Chief Financial Officer of US Network Revenue and Chief Financial Officer of Animal Planet, overseeing all financial activity and helping to drive the strategy for each operating unit. Prior to Discovery, he held senior positions at News Corporation, Viacom Inc., and Arthur Andersen LLC. Mr. Felenstein holds a B.S. in Accounting from Binghamton University. Noah Brodsky joined us as Chief Commercial Officer in May of 2022. Mr. Brodsky has built a more than 20-year career focused on inspirational travel experiences and premium guest service through a succession of sales, marketing and operating roles at leading global hospitality companies. He is a demonstrated leader in innovative marketing strategies, revenue growth and digital transformation. Most recently, Mr. Brodsky served as the President of the Travel + Leisure Group from January 2021 and Chief Brand Officer for Travel + Leisure Co. (formerly known as Wyndham Destinations) from June 2018 until April 2022. While at Wyndham, Mr. Brodsky served as EVP, Brand Strategy and Corporate Marketing of Wyndham Vacation Ownership and prior to that served as Senior Vice President, Worldwide Loyalty and Customer Engagement, for Wyndham Hotel Group, beginning in 2014. Previously, Mr. Brodsky served as Chief Experience Officer at WeWork from 2013 to 2014 and held leadership roles before that at Starwood Hotels and Resorts and Four Seasons Resorts. Mr. Brodsky holds a B.S. from Cornell University and an M.B.A. from Harvard Business School. 62 Dean (Trey) Byus III joined us in 1993 as an Expedition Leader and since 2009 has served as Lindblad’s Chief Expedition Officer overseeing programming for Lindblad’s vessels in addition to serving on the Executive Management Team. Prior to 2009, Mr. Byus served as Lindblad’s Vice President of Operations and Program Development, Director of Field Staff & Expedition Technology and Director of Field Staff. Mr. Byus has worked in regions around the world and has extensive experience in managing Lindblad’s expedition teams, vessel deployments and itineraries, R&D, pricing and marketing, as well as business development, including working with National Geographic. Mr. Byus holds a B.A. from the University of Washington. Benjamin L. Bressler joined us in May 2016, in connection with our acquisition of Natural Habitat, Inc., as the President of the company. Mr. Bressler founded Natural Habitat in 1985 and has led the company since that time. Mr. Bressler brings over three decades of experience in nature and conservation travel. Mr. Bressler holds a B.A. in Government from Skidmore College. Delinquent Section 16(a) Reports Section 16(a) of the Exchange Act requires our directors, executive officers and stockholders holding more than 10% of our outstanding common stock to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in beneficial ownership of our common stock. Section 16(a) filers are required by Securities and Exchange Commission regulations to furnish us with copies of all Section 16(a) reports they file. Based on a review of the ownership reports filed with Securities and Exchange Commission during 2023, we believe that all Section 16(a) filing requirements were met on a timely basis other than an inadvertent late Form 4 filed by each of Craig Felenstein and Trey Byus on April 28, 2023 reporting the withholding of shares by the company for taxes upon vesting of performance shares and by Mark Ein on October 4, 2023 reporting the acquisition of shares on lieu of director fees. Item 11. Executive Compensation Compensation Discussion and Analysis This compensation discussion and analysis describes the material elements of compensation awarded to, earned by, or paid to each of our named executive officers, whom we refer to as our “NEOs,” during 2023 and describes our policies and decisions made with respect to the information contained in the following tables, related footnotes and narrative for 2023. The NEOs are identified below in the table titled “Summary Compensation Table for 2023.” In this compensation discussion and analysis, we also describe various actions regarding NEO compensation taken before or after 2023 when we believe it enhances the understanding of our executive compensation program. Due to the circumstances related to the COVID-19 pandemic and compensation limits under Section 4004 of the CARES Act in connection with the Company’s prior Main Street Loan, a number of extraordinary measures were taken and discretionary decisions were made by the Compensation Committee on salaries, short-term and long-term incentive compensation of our NEOs during 2021 and 2022. During 2022, we repaid the Main Street Loan in full. Overview of Our Executive Compensation Philosophy and Design We believe that a skilled, experienced and dedicated management team is essential to our future performance and to building stockholder value. We seek to establish competitive compensation programs that enable us to attract and retain executive officers with these qualities. The other objectives of our compensation programs for our executive officers are the following: ● to motivate our executive officers to achieve and create stockholder value; ● to attract and retain executive officers who we believe have the experience, temperament, talents, and convictions to contribute significantly to our future success; and ● to align the economic interests of our executive officers with the interests of our stockholders. The Compensation Committee is focused on executive compensation being appropriate in amount and form. The Compensation Committee strives to align the interests of our executive team with the interests of our stockholders by providing incentives based upon the achievement of performance levels in relation to our strategic goals. Our Board of Directors and our Compensation Committee value the opinions of our stockholders and are committed to ongoing engagement with our stockholders on executive compensation practices. The Compensation Committee specifically considers the results from the annual stockholder advisory vote on executive compensation. At the 2023 annual meeting of shareholders, 85% of the votes cast on the stockholder advisory vote on executive compensation were in favor of our executive compensation. 63 Oversight of Executive Compensation Our Compensation Committee has primary responsibility for, among other things, determining our compensation philosophy, evaluating the performance of our executive officers, setting the compensation and other benefits of our executive officers, overseeing our response to the outcome of the advisory votes of stockholders on executive compensation, assessing the relative enterprise risk of our compensation program and administering our incentive compensation plans. Our Board of Directors, our Compensation Committee and our Chief Executive Officer will each play a role in setting the compensation of our NEOs. Our Board of Directors appoints the members of our Compensation Committee and delegates to the Compensation Committee the direct responsibility for overseeing the design and administration of our executive compensation program. The Compensation Committee evaluates the performance of the CEO and determines his compensation based on this evaluation. With respect to our other executive officers, the Compensation Committee considers the CEO’s input as to performance evaluations and recommended compensation arrangements. The compensation of all named executive officers is subject to the final approval of the committee. Management and the Compensation Committee rely upon outside advisors to determine competitive pay levels, evaluate pay program design, and assess evolving technical constraints. The Compensation Committee retained the firm of Frederic W. Cook & Co. (“FW Cook”) to consult and assist with the structuring and development of a comprehensive executive compensation program based on performance, utilizing the elements discussed below. We considered all factors relevant to FW Cook’s independence from management, including the following factors: ● The provision of other services that the consultant provides to us; ● The amount of fees received from us as a percentage of the consultant’s total revenue; ● The consultant’s policies and procedures designed to prevent conflicts of interest; ● Business or personal relationships of the consultant with our Compensation Committee members; ● The amount of our stock owned by the consultant; and ● Business or personal relationships of the consultant with our executive officers Mr. Bressler’s employment agreement provides for an annual cash bonus opportunity equal to 10% of Natural Habitat’s net profits (after giving effect to accrual or payment of such bonus), and an annual restricted stock unit award opportunity of $100,000 related to the management of the Land Experiences business segment. Accordingly, Mr. Bressler does not currently participate in the Company’s long-term or short-term incentive compensation plans described below. During 2023, Mr. Bressler earned a bonus of $1.5 million and $100,000 of restricted stock units in accordance with his employment agreement. Elements of Executive Compensation Our executive compensation program for our NEOs consists of the following elements: ● Base salary; ● Short-term (annual) cash-based incentive compensation; ● Long-term incentive compensation in the form of equity; and ● Retirement and other benefits. Base Salary We pay our NEOs a base salary to compensate them for services rendered and to provide them with a steady source of income for living expenses throughout the year. Generally, our Compensation Committee will set executive base salaries at levels comparable with those of executives in similar positions and with similar responsibilities at comparable companies. Base salaries will generally be reviewed annually by our Compensation Committee, subject to terms of employment agreements, and will adjust base salary amounts to realign such salaries with industry norms after taking into account individual responsibilities, performance and experience. The 2024 effective base salaries for our NEOs, as well as the percentage increase from the 2023 actual base salaries, if any, are as follows: Name Fiscal 2024 Base Salary Percentage Change From Fiscal 2023 Base Salary Mr. Lindblad $ 386,250 3 % Mr. Felenstein $ 489,250 3 % Mr. Brodsky $ 463,500 3 % Mr. Byus $ 360,500 3 % Mr. Bressler $ 200,000 0 % 64 Short-Term (Annual) Cash-Based Incentive Compensation We utilize annual cash incentive bonuses for executives to focus them on achieving key operational and financial objectives within a yearly time horizon. In 2017, our Compensation Committee adopted an Employee Incentive Plan (EIP) under our 2015 Long-Term Incentive Plan to govern annual cash incentive award opportunities for our executive officers and other key employees. Target award levels under the EIP are based on a percentage of each participant’s base salary and cash incentive awards are earned based on performance against metrics. 2023 Short-Term (Annual) Cash-Based Incentive Compensation For 2023, the Compensation Committee set the performance metric weightings as follows: Adjusted EBITDA (target $79.2 million; 70%), Net Yield per Available Guest Night (target $1,157; 15%) and Guest Satisfaction (target 90%; 15%). The Compensation Committee set target award levels for each of our NEOs at a target level of 75% (as a percentage of base salary). For 2023, awards could be earned at a level of up to 150% of the target level if maximum performance goals are achieved and the minimum thresholds to earn awards are as follows: Adjusted EBITDA (85% of target), Net Yield per Available Guest Night (90% of target) and Guest Satisfaction (96% of target). Our Compensation Committee has the discretion to adjust the achievement of the financial metrics for unusual and nonrecurring factors and events, such as acquisitions and other unusual events, costs and expenses. As a result of our performance, our NEOs earned 95.1% of the target award level for the short-term incentive compensation, resulting in the following bonus amounts: Name 2023 Short-Term Annual Cash-Based Incentive Bonus Amount Earned Mr. Lindblad $ 133,737 Mr. Felenstein $ 328,928 Mr. Brodsky $ 312,404 Mr. Byus $ 245,121 Long-Term Incentive Compensation We utilize equity-based incentive compensation in order to align compensation directly with the creation of value to stockholders by rewarding performance and the achievement of goals important to the Company’s strategic objectives. We believe that such compensation attracts, motivates and helps retain executives. In 2023, our Compensation Committee approved awards of restricted stock units (“RSUs”) and a performance-vesting equity incentive award (“PSUs”) grant, to key employees, including our named executive officers, under our Long-Term Incentive Plans, each as described in more detail below: 2023 Long-Term Incentive Compensation In March 2023, our Compensation Committee approved awards of RSUs and PSUs to key employees, including our named executive officers, under our LTIP, each as described in more detail below: RSUs. The RSUs are time vesting equity incentive awards that will vest in annual installments, following the March 31, 2023 grant date, subject to the recipient’s continued employment or service with us or our subsidiaries on the applicable vesting date. Upon vesting, each RSU represents the right to receive one share of our common stock or an equivalent amount of cash. Each RSU is granted in tandem with a dividend equivalent right, which is subject to the same vesting schedule as the underlying RSU to which it relates. In 2023, RSU awards were awarded in the following amounts to our NEOs, with the number of RSUs determined based upon the closing price of our common stock on the March 31, 2023 grant date, which was $9.56: Mr. Berle (former Chief Executive Officer): $287,500 (30,020 RSUs); Mr. Felenstein: $237,500 (24,843 RSUs); Mr. Brodsky: $225,000 (23,535 RSUs); and Mr. Byus: $175,000 (18,305 RSUs). The awards were granted on March 31, 2023 and will vest annually over three years on the anniversary of the grant, subject to continued service with us. PSUs. The PSUs are performance-vesting equity incentive awards that will be earned based on our annual performance against metrics relating to annual Adjusted EBITDA and annual revenue over a three-year time period. Each PSU is granted in tandem with a dividend equivalent right, which is subject to the same performance vesting terms as the underlying PSU to which it relates. Awards will vest after a three-year performance period. Performance shall be determined based on the Company's level of achievement against the target goals for each fiscal year. The number of PSUs earned shall be equal to the target number of PSUs multiplied by the average of the payout percentages for each fiscal year. For 2023, the Compensation Committee set the performance metric weightings of Annual Adjusted EBITDA (75%) and Annual Revenue (25%) for each applicable fiscal year. In 65 2023, PSU awards were granted in the following amounts to our NEOs, with the number of shares determined based upon the closing price of our common stock on the March 31, 2023 grant date, which was $9.56: Mr. Berle: $287,500 (30,020 PSUs); Mr. Felenstein: $237,500 (24,843 PSUs); Mr. Brodsky: $225,000 (23,535 PSUs); and Mr. Byus: $175,000 (18,305 PSUs). Retirement and Other Benefits We are strongly committed to encouraging all employees to save for retirement. To provide employees with the opportunity to save for retirement on a tax-deferred basis, we sponsor a 401(k)-plan pursuant to which we matched any employee contributions, including our NEOs, up to $2,400 in 2023. We also provide certain other customary benefits to our employees, including our NEOs, which are intended to be part of a competitive compensation program. These benefits, which are offered to all full-time employees, include medical, dental, life and disability insurance as well as paid leave during the year. In order to increase their knowledge and understanding of our business and the related challenges that the business faces, we encourage our employees, including our NEOs, and their families to experience our expeditions. To that end, employees and their family members are entitled to travel on expeditions at the per person variable land costs associated with the particular expedition. In addition to the land costs, the employee is responsible for airfare, any shipboard purchases and crew gratuities. Compensation on Termination of Employment Each of our named executive officers, other than Mr. Lindblad, has an employment agreement that provides for severance in the event they are terminated without cause or they leave for good reason. We believe these agreements are important for retention purposes, as many companies we compete with offer severance compensation, particularly in connection with a change of control. Accordingly, our named executive officers have the right to receive severance compensation if they are terminated without cause or they leave for good reason while the agreement is in effect. If such termination occurs within a specified period after a change of control, enhanced severance compensation, including the vesting of unvested equity awards, is provided. We believe that such compensation gives our named executive officers incentive (1) to stay with the Company despite the possibility of losing employment after a change of control and (2) to focus on obtaining the best possible value for stockholders in a change of control transaction. For additional information on compensation on termination of employment, see “Executive Compensation—Agreements with Executive Officers” and “Executive Compensation—Estimated Additional Compensation Triggered by Termination of Employment.” Clawback Policy We have adopted a clawback policy that provides that we shall, except in limited circumstances, recover any erroneously awarded incentive based compensation from our named executive officers. The policy is filed as an exhibit to this Annual Report on Form 10-K. 66 Summary Compensation Table The following table summarizes the compensation earned in each of the last three completed fiscal years to our NEOs: Name and Principal Position Year Salary (1) Bonus Stock Awards (2) Option Awards (2) All Other (6) Total Mr. Lindblad (3) Chief Executive Officer 2023 $ 187,500 $ 133,737 $ 1,996,000 $ - $ 35,265 $ 2,352,502 2022 $ - $ - $ - $ - $ - $ - 2021 $ - $ - $ 772,519 $ - $ 38,608 $ 811,127 Mr. Felenstein Chief Financial Officer 2023 $ 461,167 $ 328,928 $ 474,998 $ 1,198,000 $ 39,562 $ 2,502,655 2022 $ 412,000 $ 317,343 $ 411,986 $ - $ 42,931 $ 1,184,259 2021 $ 412,000 $ 296,014 $ 411,982 $ - $ 42,840 $ 1,162,836 Mr. Brodsky (4) Chief Commercial Officer 2023 $ 438,000 $ 312,404 $ 450,008 $ - $ 24,221 $ 1,224,633 2022 $ 241,900 $ 75,000 $ 437,506 $ 2,809,777 $ 13,092 $ 3,577,275 Mr. Byus III Chief Expedition Officer 2023 $ 343,667 $ 245,121 $ 349,992 $ 1,198,000 $ 39,562 $ 2,176,342 2022 $ 283,250 $ 218,173 $ 283,263 $ - $ 42,931 $ 827,616 2021 $ 283,250 $ 203,510 $ 283,235 $ - $ 42,840 $ 812,835 Mr. Bressler President, Natural Habitat, Inc. 2023 $ 200,000 $ 1,586,704 $ 99,998 $ - $ 47,440 $ 1,934,142 2022 $ 200,000 $ 1,183,389 $ 100,000 $ - $ 50,809 $ 1,534,198 2021 $ 171,354 $ 211,500 $ - $ - $ 50,718 $ 433,572 Mr. Berle (5) Former Chief Executive Officer 2023 $ 289,712 $ - $ 574,996 $ 574,996 $ 23,424 $ 1,463,127 2022 $ 575,000 $ 442,894 $ 575,000 $ - $ 42,409 $ 1,635,303 2021 $ 370,432 $ 302,892 $ 1,012,973 $ 5,230,000 $ 19,966 $ 6,936,263 (1) Due to circumstances related to the impact of the COVID-19 pandemic, Mr. Lindblad declined a salary for a significant period of 2021, and similarly, Mr. Bressler reduced his annual salary in 2021. There was a restriction and freeze on executive salary for the period that the Company’s Main Street Loan was outstanding plus one year, the Main Street Loan was repaid in 2022. (2) With respect to stock awards, the grant date fair value is measured based on the closing market value on the date of grant. Mr. Lindblad’s 2023, Mr. Brodsky's 2022 and Mr. Berle’s 2021 grants relate to their employment agreements. With respect to options, the calculated grant date fair value of Messrs. Felenstein’s and Byus’ 2023 options were $5.99 per share, Mr. Brodsky's 2022 options were awarded in two grants at $8.18 and $7.27 per option and Mr. Berle’s 2021 options were $5.23 per option. Refer to Note 12 of our consolidated financial statements included herein for assumptions used to value equity awards. (3) Mr. Lindblad served as our Chief Executive Officer through May 2021. Thereafter, he served as director and Board Co-Chair before being re-appointed as Chief Executive Officer on July 20, 2023. Amounts in the table exclude any amounts earned for service as a director of the Company during the time he did not serve as an executive officer. (4) Mr. Brodsky joined the Company on May 31, 2022. Mr. Brodsky's 2022 bonus includes a $75,000 hiring bonus. (5) Mr. Berle left the Company on May 31, 2023. (6) The amounts in this column for 2023 consist of the following for each executive: 67 Name 401(k) Match Health Insurance Premiums Life, Accidental Death & Dismemberment and Long-Term Disability Premiums Other (a) Mr. Lindblad $ - $ 34,532 $ 733 $ - Mr. Felenstein $ 2,400 $ 34,532 $ 2,630 $ - Mr. Brodsky $ 2,400 $ 19,713 $ 2,108 $ - Mr. Byus $ 2,400 $ 34,532 $ 2,630 $ - Mr. Bressler $ 2,400 $ 34,532 $ 2,108 $ 8,400 Mr. Berle $ 2,400 $ 20,144 $ 880 $ - (a) Mr. Bressler receives a monthly vehicle allowance. Pay Ratio We have estimated the ratio between our Chief Executive Officer’s total compensation and the median annual total compensation of all employees (except the Chief Executive Officer). In searching for the median employee, we considered taxable compensation totals in 2023. We identified the “Median Employee” based on the taxable compensation of all full-time, part-time, and temporary employees employed by us on December 31, 2023, then we calculated the Median Employee’s compensation under the Summary Compensation Table rules. Our Chief Executive Officer had annual total compensation of $ 2,352,502 and our Median Employee had annual total compensation of $144,973. Therefore, we estimate that our Chief Executive Officer’s annual total compensation for 2023 was approximately 16.2 times that of the median of the annual total compensation of all of our employees. This compensation ratio was significantly impacted during 2023 due to the one-time initial grants of RSUs provided to Mr. Lindblad upon his appointment as Chief Executive Officer in July 2023. Excluding the one-time hire grants provided to Mr. Lindblad, and including traditional annual grants of RSUs and PSUs in lieu of them, with a grant date value of $375,000, we estimate that the Chief Executive Officer’s annual total compensation for 2023 would have been approximately 5.1 times that of the median of the annual total compensation of all of our employees for 2023. Grants of Plan Based Awards During 2023 The following table sets forth information about grants of plan-based awards to our NEOs during the year ended December 31, 2023. 68 Estimated Possible Payouts Under Non-Equity Incentive Plan Awards (1) Estimated Future Payouts Under Equity Incentive Plan Awards (2) Name Grant Date of Equity Incentive Plan Awards Threshold ($) Target ($) Maximum ($) Threshold (#) Target (#) Maximum (#) All Other Stock Awards: Number of Options, Shares of Stock or Units (#) (3) Grant Date Fair Value of Stock and Option Awards ($) (4) Mr. Lindblad $ - $ - $ - 7/21/2023 200,000 $ 1,996,000 Mr. Felenstein $ - $ 356,250 $ 534,375 03/31/23 24,843 $ 237,499 03/31/23 200,000 $ 1,198,000 03/31/23 - 23,536 47,072 $ 225,004 Mr. Brodsky $ - $ 337,500 $ 506,250 03/31/23 23,536 $ 225,004 03/31/23 - 18,305 36,610 $ 174,996 Mr. Byus $ - $ 150,000 $ 225,000 03/31/23 18,305 $ 174,996 03/31/23 200,000 $ 1,198,000 03/31/23 - 24,843 49,686 $ 237,499 Mr. Bressler $ - $ - $ - 03/31/23 10,460 $ 99,998 Mr. Berle $ - $ 281,250 $ 421,875 03/31/23 30,073 $ 287,498 03/31/23 - 30,073 60,146 $ 287,498 (1) The amount shown represents the range of possible cash incentive awards that could have been earned under our 2023 Short-Term (Annual) Cash-Based Incentive Compensation plan. For additional information, see “Compensation Discussion and Analysis.” (2) The amounts shown represent the range of PSU stock awards that may be earned under our 2023 Long-Term Incentive Compensation Plan for performance during 2023 through 2025. For additional information, see “Compensation Discussion and Analysis.” (3) The amount represents RSUs granted under our 2023 Long-Term Incentive Compensation Plan. For additional information, see “Compensation Discussion and Analysis” and “Outstanding Equity Awards at 2023 Fiscal Year End” table. (4) Amount represents the aggregate grant date fair value computed in accordance with FASB ASC 718. With respect to stock awards, the grant date fair value is measured based on the closing market value on the date of grant. With respect to options, the calculated grant date fair value of Messrs. Felenstein’s and Byus’ 2023 options were $5.99 per share. Refer to Note 12 of our consolidated financial statements included herein for assumptions used to value equity awards. 69 Outstanding Equity Awards at 2023 Fiscal Year-End The following table sets forth information about outstanding equity awards held on December 31, 2023 by our NEOs. Option Awards Stock Awards Name Number of Securities Underlying Unexercised Options Exercisable (#) Number of Securities Underlying Unexercised Options Un-exercisable (#) (2) Option Exercise Price ($) Option Expiration Date Number of Shares or Units of Stock That have Not Vested (#) (2) Market Value of Shares or Units of Stock That Have Not Vested ($) (1) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (1) Mr. Lindblad - - $ - N/A 206,812 $ 2,330,771 20,437 (3 ) $ 230,325 Mr. Felenstein - 200,000 $ 9.56 03/31/33 42,583 $ 479,907 10,899 (3 ) $ 122,832 188,000 - $ 9.47 09/06/26 13,660 (4 ) $ 153,948 24,843 (5 ) $ 279,981 Mr. Brodsky 40,115 120,343 $ 14.36 05/31/32 46,386 $ 522,773 23,536 (5 ) $ 265,251 10,000 30,000 $ 12.64 06/10/32 Mr. Byus - 200,000 $ 9.56 03/31/33 27,063 $ 305,004 7,493 (3 ) $ 84,446 - - $ - N/A 9,392 (4 ) $ 105,848 18,305 (5 ) $ 206,297 Mr. Bressler - - $ - N/A 10,460 $ 117,884 - $ - 238,115 350,343 333,304 $ 3,756,339 128,565 $ 1,448,928 (1) The amounts in this column have been computed based on the closing price of our common stock of $11.27 on December 29, 2023 (the last business day of 2023). The actual value realized by the executive will depend on the market value of our common stock on the date that the awards vest and the actual number of shares that vest. (2) The shares vest as follows: Unvested Stock Awards (number of shares, units or options) Mr. Lindblad Mr. Felenstein Mr. Brodsky Mr. Byus Mr. Bressler Vesting Dates - 24,843 23,536 18,305 10,460 RSUs vest 33% on each March 31, 2024, 2025 and 2026 200,000 - - - - RSUs vest 25% on each January 21 and July 21, 2024 and 2025 6,812 9,107 - 6,261 - RSUs vest 50% on each March 31, 2024 and 2025 - 3,633 - 2,497 - RSUs vest 100% on each March 31, 2024 - 5,000 - - - RSUs vest 100% on each December 8, 2024 - - 22,850 - - RSUs vest 33% each on May 31, 2024, 2025 and 2026 - 200,000 - 20,000 - Options vest 25% on each of May 31, 2024, 2025, 2026 and 2027 - - 120,343 - - Options vest 33% on each of May 31, 2024, 2025 and 2026 - - 30,000 - - Options vest 33% on each of June 10, 2024, 2025 and 2026 70 (3) Represents MSUs in an amount equal to the maximum possible awards available on December 31, 2023 under our 2021 long-term incentive compensation plan based on performance during 2021 through 2024. The MSUs are market-based equity incentive awards based on a performance-multiplier of change in the stock price of the Company’s common stock between the grant date and a determined closing price. Awards will vest after a three-year performance period and may be earned at a level ranging from 0% to 150% of the number of MSUs granted, depending on performance. Performance shall be determined by dividing (i) the average Company stock closing price for 10 consecutive trading days ending on the vesting date by (ii) the Company stock closing price on the day of the grant, provided, however, that in no event shall the performance exceed 150%. The number of MSUs earned shall be determined based upon the closing price of our common stock on our March 31, 2024 stock price and shall vest on that date. In 2021, MSU awards were awarded in the following amounts to our NEOs, with the number of shares determined based upon the closing price of our common stock on the grant date: Mr. Felenstein: $206,000; Mr. Byus: $141,625 and Mr. Lindblad $386,259. The awards were granted on March 31, 2021, with the award amount determined based upon the closing price of our common stock on March 31, 2021, which was $18.90. (4) Represents MSUs in an amount equal to the maximum possible awards available on December 31, 2023 under our 2021 long-term incentive compensation plan based on performance during 2022 through 2025. The MSUs are market-based equity incentive awards based on a performance-multiplier of change in the stock price of the Company’s common stock between the grant date and a determined closing price. Awards will vest after a three-year performance period and may be earned at a level ranging from 0% to 150% of the number of MSUs granted, depending on performance. Performance shall be determined by dividing (i) the average Company stock closing price for 10 consecutive trading days ending on the vesting date by (ii) the Company stock closing price on the day of the grant, provided, however, that in no event shall the performance exceed 150%. The number of MSUs earned shall be determined based upon the closing price of our common stock on our March 31, 2025 stock price and shall vest on that date. In 2021, MSU awards were awarded in the following amounts to our NEOs, with the number of shares determined based upon the closing price of our common stock on the grant date: Mr. Felenstein: $206,000; and Mr. Byus: $141,631. The awards were granted on March 31, 2022, with the award amount determined based upon the closing price of our common stock on March 31, 2022, which was $15.08. (5) Represents PSUs in an amount equal to the maximum possible awards available on December 31, 2023 under our 2021 long-term incentive compensation plan based on performance during 2023 through 2025. For additional information, see “Compensation Discussion and Analysis.” Option Exercises and Stock Vested in 2023 The following table sets forth information about option exercises and restricted stock vesting for our NEOs in 2023. Option Awards Stock Awards Name Number of Shares Acquired on Exercise (#) Value Realized on Exercise ($) Number of Shares Acquired on Vesting (#) Value Realized on Vesting ($) (1) Mr. Lindblad - $ - 45,024 $ 325,432 Mr. Berle - $ - 18,046 $ 59,664 Mr. Felenstein - $ - 33,565 $ 227,772 Mr. Brodsky - $ - 7,617 $ 72,207 Mr. Byus - $ - 19,640 $ 187,755 - $ - 123,891 $ 872,829 (1) The amounts in this column represent the aggregate market value of the shares of common stock acquired upon vesting based on the closing price on the applicable vesting date or, if the market was closed on the vesting date, the last trading day that immediately preceded the vesting date. Agreements with Executive Officers We have entered into agreements with certain of our executive officers as follows: Dean (Trey) Byus III. On September 4, 2018, we entered into an amendment to the employment agreement with Mr. Byus, which (i) extended the term of the employment agreement until March 31, 2020, with automatic twelve-month renewal periods thereafter unless either party provides prior notice of non-renewal; (ii) provides for an annual target cash bonus equal to 75% of his base salary in 2018 (subject to adjustment by the Company’s Compensation Committee in future periods provided that such target cash bonus amount shall not be reduced to less than 65% of his base salary) and (iii) provides for participation in the Company’s equity incentive plans with the expectation that he will receive an annual equity award targeted at 100% of his base salary. If we were to terminate Mr. Byus’s employment without “cause” (which includes our non-extension of the term) or if he were to resign for good “reason” (each a “Qualifying Termination”), Mr. Byus will be entitled to, subject to his signing and not revoking a general release of claims, (i) severance payments equal to one times the sum of annual base salary plus average annual bonus over the preceding three-year period, payable over a 12 month period in accordance with our customary payroll practices; (ii) a pro-rated bonus for the year of termination (based on actual performance for the fiscal year) and (iii) COBRA continuation coverage for 12 months after the termination date. 71 If a Qualifying Termination occurs within one year after a change in control, or while we are party to a definitive agreement the consummation of which would result in a change in control, the employment agreement provides that the executive will be entitled to, subject to his signing and not revoking a general release of claims and in lieu of the amounts above, (i) severance payments equal to two times the sum of annual base salary plus target annual bonus amount, payable over a 24-month period in accordance with our customary payroll practices; (ii) a pro-rated bonus for the year of termination (based on our actual performance for the fiscal year) and (iii) COBRA continuation coverage for 24 months after the termination date. The employment agreement contains mutual non-disparagement and customary confidentiality and assignment of inventions provisions. In addition, for 24 months following termination, the employment agreement prohibits Mr. Byus from competing with our business worldwide (except for providing services to a conglomerate that competes with us if the executive is not directly involved with the competitive division or line) and from soliciting our employees, independent contractors, customers, suppliers and similar counterparties. “Cause” is defined to mean, subject to us providing timely notice and the right to cure, (i) willful misconduct and mismanagement that is materially injurious to us; (ii) refusal in any material respect to carry out or comply with any lawful and reasonable directive of our Board of Directors consistent with the terms of the employment agreement; (iii) conviction, plea of no contest, or plea of nolo contendere for any felony; (iv) unlawful use (including being under the influence) or possession of illegal drugs on our (or any of our subsidiaries’) premises while performing duties and responsibilities under the employment agreement; (v) commission of an act of fraud, embezzlement, willful misappropriation, willful misconduct, or breach of fiduciary duty, in any case that results in material harm to us or any of our affiliates; (vi) material violation of any provision of the employment agreement or material written policy; or (vii) willful or prolonged, and unexcused, absence from work (other than by reason of disability due to physical or mental illness). Action or inaction is only “willful” if done or omitted without the good faith belief that such action or inaction is in our best interests. “Good reason” is defined to mean (i) a material diminution in base compensation, the budget that Mr. Byus oversees, or his authority, duties or responsibilities (including reporting relationships); (ii) a material change in geographic location where Mr. Byus must perform services; or (iii) any other action or inaction that constitutes a material breach of the employment agreement. Craig I. Felenstein. In connection with his appointment as Chief Financial Officer, we entered into an employment agreement with Mr. Felenstein for an initial term of four years, pursuant to which he was provided with the following compensation arrangements: (i) an initial annual base salary of $400,000; (ii) an annual bonus opportunity through an incentive bonus program established by our Board of Directors or our Compensation Committee, with bonuses to be targeted at 75% of annual base salary; (iii) an annual equity incentive award to be targeted at 100% of annual base salary; (iv) a grant of 40,000 restricted shares of our common stock vesting annually pro rata over a four-year period; and (v) a grant of stock options to purchase 200,000 shares of our common stock vesting annually pro rata over a four-year period; provided, however, that (a) if Mr. Felenstein’s employment terminates due to death, disability or without cause or due to his resignation for good reason prior to the fourth anniversary of the effective date of the agreement, the portion of the restricted shares and the shares subject to the stock option scheduled to vest on the next regular anniversary vesting date shall vest; (b) upon a “change in control” (as defined in our Long-Term Incentive Plans), the value of any unvested restricted shares will be retained in Mr. Felenstein’s favor under comparable terms as he had prior to such change in control (which retention may be in the form of stock and/or cash); and (c) if Mr. Felenstein’s employment terminates without cause or due to his resignation for good reason within one year after a change in control, 100% of the restricted shares and the shares subject to the stock option (to the extent outstanding following such transaction) shall vest. In addition, if Mr. Felenstein’s employment is terminated without cause or due to his resignation for good reason, he will be entitled to continuation of his annual base salary and payment or reimbursement of COBRA premiums for a twelve-month period if such termination occurs on or after the three-year anniversary of the effective date. Upon such termination or his death or disability, Mr. Felenstein will also be entitled to a pro-rated portion of any annual bonus for the year of termination. To receive these severance payments and benefits, Mr. Felenstein must execute a general release of claims. Mr. Felenstein will also be prohibited from competing with the Company or soliciting the Company’s employees, customers or suppliers for a period of two years following his termination of employment. The definition of “cause” and “good reason” are the same as set forth above for Mr. Byus. 72 Noah Brodsky. In connection with his appointment as Chief Commercial Officer, we entered into an employment agreement with Mr. Brodsky for an initial term through May 31, 2026, which renews automatically annually, pursuant to which he was provided with the following compensation arrangements: (i) an initial annual base salary of $400,000; (ii) an annual bonus opportunity through an incentive bonus program established by our Board of Directors or our Compensation Committee, with bonuses to be targeted at 75% of annual base salary; (iii) an annual equity incentive award to be targeted at 100% of annual base salary; (iv) a grant valued at $1.75 million, 75% of which will be issued in options and 25% of which will be issued in Restricted Stock Units, each vesting annually pro rata over a four-year period commencing on the Effective Date under the Company’s 2021 LTIP; provided, however, that if Mr. Brodsky’s employment terminates without cause or due to his resignation for good reason within one year after a change in control, 100% of the restricted shares and the shares subject to the stock option (to the extent outstanding following such transaction) shall vest. In addition, if Mr. Brodsky’s employment is terminated without cause or due to his resignation for good reason, he will be entitled to continuation of his annual base salary and payment or reimbursement of COBRA premiums for a twelve-month period. Upon such termination or his death or disability, Mr. Brodsky will also be entitled to a pro-rated portion of any annual bonus for the year of termination. To receive these severance payments and benefits, Mr. Brodsky must execute a general release of claims. Mr. Brodsky will also be prohibited from competing with the Company or soliciting the Company’s employees, customers or suppliers for a period of two years following his termination of employment. The definition of “cause” and “good reason” are the same as set forth above for Mr. Byus. Benjamin L. Bressler. In connection with the acquisition of Natural Habitat, we entered into an employment agreement with Mr. Bressler, amended May 2020 and December 2022, for a term extended through December 31, 2025, pursuant to which he was provided with the following compensation arrangements: (i) an initial annual base salary of $200,000; (ii) an annual cash bonus opportunity equal to 10% of Natural Habitat’s net profits (after giving effect to accrual or payment of such bonus) (the “Net Profit Bonus”); (iii) an equity incentive opportunity to earn an award of options based on the future financial performance of Natural Habitat. Specifically, as soon as practicable after December 31, 2025, we will calculate the Final Year Equity Value of Natural Habitat (as defined in the employment agreement) and if it exceeds $25 million, effective as of December 31, 2025, subject to his continued employment through that date, Mr. Bressler will be granted a number of options that will have a fair value (generally determined in accordance with applicable accounting standards) equal to 10.1% of such excess, with a one-time 50% early election as of December 31, 2023. Any such options will have a per-share exercise price equal to the fair market value of our common stock on the grant date and will be fully vested and exercisable as of the grant date. If our Board of Directors reasonably determines that issuing options would violate any applicable law or regulation or any applicable securities exchange listing standards or other requirements or the terms and conditions of our equity incentive plan then in effect, we may instead settle the equity incentive opportunity with a lump-sum cash payment equal to 10.1% of such excess; (iv) a managed business value equity incentive opportunity where Mr. Bressler shall also have an opportunity to earn a stock or cash award based on the future financial performance of the managed businesses; and (v) be eligible to participate in and may receive additional awards under any of Parent’s equity incentive award plans and programs as in effect from time to time, such awards will include an annual restricted stock unit award opportunity with a target annual award value of $100,000, which may be earned based on the business performance of the Managed Businesses. In addition, in the event Natural Habitat makes any dividend payment or other distribution to its stockholders during the period beginning on the closing date of the acquisition of Natural Habitat and ending on December 31, 2023, upon the occurrence of such dividend payment or other distribution, Mr. Bressler will be entitled to receive a supplementary compensatory cash payment equal to 10.1% of the aggregate dividend or distribution payment amount, subject to his continued employment through the date of payment. The employment agreement also provides that, upon the termination of Mr. Bressler’s employment due to death or disability, subject to his signing and not revoking a general release of claims, he will be entitled to (i) a pro-rated portion of any Net Profit Bonus for the year of termination (based on Natural Habitat’s actual net profits for such year) and (ii) if such termination occurs prior to December 31, 2025, a lump sum cash payment equal to 10.1% of the Final Year Equity Value of Natural Habitat (determined in this circumstance as of the last day of the calendar quarter ending prior to the termination date) over $25.0 million (the “Equity Opportunity Payout”). The employment agreement also provides that, upon the termination of Mr. Bressler’s employment without cause or his resignation of employment for good reason, subject to his signing and not revoking a general release of claims, he will be entitled to (i) severance payments equal to one times his annual base salary, (ii) any Net Profit Bonus for the year of termination (based on Natural Habitat’s actual net profits for such year) and (iii) if such termination occurs prior to December 31, 2025, the Equity Opportunity Payout. The employment agreement contains confidentiality and assignment of inventions provisions for the benefit of us, Natural Habitat and their direct and indirect subsidiaries and prohibits Mr. Bressler from competing with, or soliciting the employees of, us, Natural Habitat and their direct and indirect subsidiaries, for a period of two years following his termination. In addition, Mr. Bressler’s remaining 19.9% ownership interest in Natural Habitat is subject to an arrangement providing for put/call rights that generally cannot be exercised, with certain exceptions, until 2025. 73 “Cause” is defined in the employment agreements to mean, subject to us providing timely notice and the right to cure, (i) willful misconduct and mismanagement that is materially injurious to Natural Habitat; (ii) refusal in any material respect to carry out or comply with any lawful and reasonable directive of the Natural Habitat Board of Directors or our Board of Directors consistent with the terms of the employment agreement; (iii) conviction, plea of no contest, or plea of nolo contendere for any felony; (iv) unlawful use (including being under the influence) or possession of illegal drugs on our (or any of our subsidiaries’) premises while performing executive’s duties and responsibilities under the employment agreement; (v) commission of an act of fraud, embezzlement, willful misappropriation, willful misconduct, or breach of fiduciary duty, in any case that results in material harm to us or any of our affiliates; (vi) material violation of any provision of the employment agreement or material written policy; or (vii) willful or prolonged, and unexcused, absence from work (other than by reason of disability due to physical or mental illness). Action or inaction is only “willful” if done or omitted without the good faith belief that such action or inaction is in the best interests of Natural Habitat. “Good reason” is defined in the employment agreement to mean (i) a material diminution in base compensation or the formula for determining Net Profit Bonus from the highest level in effect during the term, the budget that Mr. Bressler oversees, or his authority, duties or responsibilities (including reporting relationships); (ii) a material change in geographic location where he must perform services; or (iii) any other action or inaction that constitutes a material breach of the employment agreement. Estimated Additional Compensation Triggered by Termination of Employment if Terminated on the Last Business Day of 2023 The following table illustrates the additional compensation that we estimate would be payable to each of our NEOs on termination of employment under each of the circumstances described above, assuming the termination occurred on December 31, 2023. The amounts shown are estimates and do not necessarily reflect the actual amounts that these individuals would receive on termination of employment. Termination Without Cause or for Good Reason Without a Change in Control: Name Cash Equity Perquisites/ Benefits Total Mr. Lindblad $ - $ 1,203,771 (3 ) $ - $ 1,203,771 Mr. Felenstein $ 790,095 (1 ) $ 293,257 (4 ) $ 31,168 (6 ) $ 1,114,520 Mr. Brodsky $ 750,404 (1 ) $ 522,773 (5 ) $ 31,168 (6 ) $ 1,304,345 Mr. Byus $ 811,056 (2 ) $ - $ 31,168 (6 ) $ 842,224 Mr. Bressler $ 31,938,368 (12 ) $ - $ 46,752 (7 ) $ 31,985,120 Termination Without Cause or for Good Reason in connection with a Change in Control: Name Cash Equity Perquisites/ Benefits Total Mr. Lindblad $ - $ 1,203,771 (10 ) $ - $ 1,203,771 Mr. Felenstein $ 790,095 (1 ) $ 479,907 (9 ) $ 31,168 (6 ) $ 1,301,170 Mr. Brodsky $ 750,404 (1 ) $ 522,773 (10 ) $ 31,168 (6 ) $ 1,304,345 Mr. Byus $ 1,425,103 (8 ) $ - $ 62,336 (11 ) $ 1,487,439 Mr. Bressler $ 31,938,368 (12 ) $ - $ 46,752 (7 ) $ 31,985,120 (1) Amount represents twelve months of annual salary and the annual bonus amount actually paid for the 2023 fiscal year. (2) Amount represents the sum of (i) one times annual base salary; (ii) average annual bonus for the years ended December 31, 2023, 2022 and 2021; and (iii) the annual bonus amount actually paid for the 2023 fiscal year. (3) Amount shown represents (a) the product of (i) the number of shares underlying all unvested stock options and (ii) the excess, if any, of the closing price per share of our common stock on December 29, 2023 of $11.27 and the exercise price per share of such options, plus (b) the market value of 27% of the unvested RSUs at the December 29, 2023 closing share price of $11.27. (4) Amount shown represents (a) the product of (i) the number of shares underlying all unvested stock options and (ii) the excess, if any, of the closing price per share of our common stock on December 29, 2022 of $7.70 and the exercise price per share of such options, plus (b) the market value of 40% of the unvested RSUs at the December 29, 2023 closing share price of $11.27. (5) Amounts represents the product of (i) the number of shares underlying all unvested stock options and (ii) the excess, if any, of the closing price per share of our common stock on December 29, 2023 of $11.27 and the exercise price per share of such options. (6) Amount represents the value of COBRA continuation coverage for a period of 12 months. (7) Amount represents the value of COBRA continuation coverage for a period of 18 months. (8) Amount represents the sum of (i) two times the sum of annual base salary and target bonus; and (ii) the annual bonus amount actually paid for the 2023 fiscal year. 74 (9) Amount shown represents the sum of the market value of 100% of the unvested RSUs at the December 29, 2023 closing share price of $11.27. (10) Amount shown represents the product of (i) the number of shares underlying all unvested stock options and (ii) the excess, if any, of the closing price per share of our common stock on December 29, 2023 closing share price of $11.27 and the exercise price per share of such options. (11) Amount represents the value of COBRA continuation coverage for a period of 24 months. (12) Amount represents the sum of (i) annual base salary, (ii) the annual bonus amount actually paid for the 2023 fiscal year and (iii) Company Value Increase amount as defined per the employment acquisition agreement. Compensation Committee Interlocks and Insider Participation During the last fiscal year, no member of our Compensation Committee served as one of our employees. No member of our Compensation Committee entered into a related party transaction with us during fiscal year 2023; however, Mr. Fahey's daughter was employed by us during 2023. See Item 13 herein for additional information. No interlocking relationships exist between our Board of Directors or our Compensation Committee and the board of directors or the Compensation Committee of any other entity. None of our executive officers serves, or in the past year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board of Directors or our Compensation Committee. Compensation Committee Report Our Compensation Committee has reviewed and discussed the “Compensation Discussion and Analysis” contained in this Annual Report on Form 10-K with management. Based on our Compensation Committee’s review and discussions with management, our Compensation Committee recommended to our Board of Directors that the Compensation Discussion and Analysis be included in this Annual Report on Form 10-K. John M. Fahey (Chair) Elliott Bisnow L. Dyson Dryden Mark D. Ein Catherine B. Reynolds Director Compensation Our non-employee director compensation includes annual cash fees of $55,000 for each non-employee director, additional $40,000 of cash compensation for the Chair of the Board, additional cash compensation for chair of board committees ($15,000 for the Audit Committee Chair and $10,000 for the Chairs of the other committees), and an annual grant of $85,000 in shares of restricted stock. Our 2023 annual restricted stock grant was made in August 2023, with the awards resulting in 8,276 restricted shares per director that vest in August 2024, subject to continued service with us. We have also established a deferred compensation program for our non-employee directors to elect to defer receipt of their director compensation or to elect to receive shares of the Company’s common stock in lieu of cash compensation. In order to increase their knowledge and understanding of our business and the related challenges that the business faces, we encourage our non-employee Board members and their families to experience our expeditions. Under the Directors Expedition Policy, a Board member is entitled to take one expedition every calendar year with no cost to the director. Each expedition the director participates in must be on a different vessel and must be a different itinerary than they have taken in the past. The director’s family, at the cost to the director including airfare, may accompany the director on the expedition. Each of the director’s family members will be charged a rate equal to the Company’s cost for the expedition, plus airfare, subject to certain exceptions. 75 Director Compensation for 2023 Name Fees Earned or Paid in Cash Option Awards Stock Awards (1) All Other Compensation Total Mr. Aronson (2) $ - $ - $ 148,253 $ - $ 148,253 Mr. Bisnow $ 55,000 $ - $ 93,271 $ - $ 148,271 Mr. Dryden (3) $ 70,000 $ - $ 93,271 $ - $ 163,271 Mr. Ein (2) (4) $ - $ - $ 198,247 $ - $ 198,247 Mr. Fahey (5) $ 65,000 $ - $ 93,271 $ - $ 158,271 Mr. Lindblad (6) $ 47,500 $ - $ - $ - $ 47,500 Ms. Reynolds $ 55,000 $ - $ 93,271 $ - $ 148,271 Mr. Schultz $ 55,000 $ - $ 93,271 $ - $ 148,271 Mr. Smith $ 55,000 $ - $ 93,271 $ - $ 148,271 (1) In accordance with SEC rules, the amounts shown reflect the aggregate grant date fair value of stock awards granted to non-employee Directors during 2023, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“FASB ASC 718”). The grant date fair value is measured based on the closing fair market value of our common stock on the date of grant. (2) Mr. Aronson and Mr. Ein elected stock-based compensation in lieu of cash for 2023, resulting in awards totaling 5,830 and 11,131 shares, respectively. (3) Mr. Dryden earned additional compensation of $15,000 for serving as the Chairperson of the Audit Committee during 2023. (4) Mr. Ein earned additional compensation of $40,000 for serving as the Chairperson of the Board of Directors and $10,000 for serving as the Chairperson of the Nominating Committee during 2023. (5) Mr. Fahey earned additional compensation of $10,000 for serving as the Chairperson of the Compensation Committee during 2023. (6) Represents director fees paid to Mr. Lindblad prior to becoming our Chief Executive Officer. 76 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters PRINCIPAL STOCKHOLDERS The following table sets forth information regarding the beneficial ownership of our common stock and Series A Preferred Stock as of January 31, 2024 by (i) each person who, to our knowledge, owns more than 5% of our common stock or Series A Preferred Stock, (ii) each of our current directors and executive officers, and (iii) all of our current directors and executive officers as a group. Derivative securities exercisable or convertible into shares of our common stock within sixty (60) days of January 31, 2024 are deemed to be beneficially owned and outstanding for computing the share ownership and percentage of the person holding securities, but are not deemed outstanding for computing the percentage of any other person. The address of named beneficial owners that are our officers and/or directors is: c/o Lindblad Expeditions Holdings, Inc., 96 Morton Street, 9th Floor, New York, NY 10014. The following table is based upon information supplied by officers and directors, and with respect to 5% or greater stockholders who are not officers or directors, information filed with the Securities and Exchange Commission. Name of Beneficial Owner Number of Shares of Common Stock Beneficially Owned (1) Percentage Beneficially Owned (1) Number of Shares of Series A Preferred Stock Beneficially Owned (2) Percentage of Series A Preferred Stock Beneficially Owned (2) Total Voting Power (3) Management and Directors: Sven-Olof Lindblad (4) 11,673,961 21.9 % - - 19.0 % Craig Felenstein (5) 314,321 * - - * Noah Brodsky (6) 65,858 * - - * Dean (Trey) Byus III (7) 58,418 * - - * Benjamin L. Bressler (8) 3,486 * - - * Bernard W. Aronson (11) 53,327 * - - * Elliott Bisnow (12) 50,922 * - - * L. Dyson Dryden (10) 956,959 1.8 % - - 1.6 % Mark D. Ein (9) 3,276,490 6.1 % - - 5.3 % John M. Fahey (10) 107,831 * - - * Catherine Reynolds (10) 50,431 * - - * Alexander P. Schultz (10) 85,108 * - - * Thomas S. (Tad) Smith Jr. (10) 69,666 * - - * All directors and executive officers as a group (13 persons) 16,766,778 31.4 % - - 27.3 % 5% Owners: Ariel Investments, LLC (13) 8,608,216 16.1 % - - 14.0 % Capitol Acquisition Management 2 LLC (9) 3,276,490 6.1 % - - 5.3 % List of 5% Series A Preferred Stockholders: MSD SIF Partners II LLC (14) - * 30,000 48.4 % 6.3 % Headlands Strategic Opportunities Fund LP (15) - * 15,000 24.2 % 3.2 % Moelis Dynasty Investments LLC (16) - * 12,000 19.4 % 2.5 % Pimco Red Stick Fund LP (17) - * 5,000 8.1 % 3.2 % * Denotes ownership of less than 1%. (1) Derivative securities exercisable or convertible into shares of our common stock within sixty (60) days of January 31, 2024 are deemed to be beneficially owned and outstanding for computing the share ownership and percentage of the person holding securities but are not deemed outstanding for computing the percentage of any other person. Based on 53,398,608 shares of common stock issued and outstanding as of January 31, 2024 (including outstanding restricted stock). (2) Series A Preferred Stock with voting rights on an as converted basis, convertible into shares of our common stock as of January 31, 2024 are deemed to be beneficially owned and outstanding for computing the share ownership and percentage of the person holding securities. Based on 62,000 shares of Series A Preferred Stock issued and outstanding and convertible into an aggregate of 7,999,412 shares of our common stock as of January 31, 2024. 77 (3) Total voting power based on total shares of common stock issued and outstanding as of January 31, 2024 and total votable basis Series A Preferred Stock as of January 31, 2024 for an aggregate total of 61,398,020 votes. (4) Excludes 150,000 unvested restricted stock units (“RSUs”) that vest 33% on July 21, 2024, January 21, 2025 and July 21, 2025, subject to continued service on the vesting date, and 20,436 unvested MSUs that vest March 31, 2024, subject to achieving stock price performance targets and continued service on the vesting date. (5) Excludes 5,000 unvested RSUs that vest fully on December 8, 2024, 21,448 unvested RSUs that vest 50% on each of December 21, 2024 and 2025, 4554, unvested RSUs that vest 100% on March 31, 2025, 16,562 unvested RSUs that vest 50% on each of March 31, 2025 and 2026, subject to continued service on the vesting date, 10,899 unvested MSUs that vest March 31, 2024, 13,660 MSUs that vest on March 31, 2025, subject to achieving performance targets and continued service on the vesting date, and 24,843 unvested PSUs that vest on March 31, 2026, subject to achieving performance targets and continued service on the vesting date. Includes vested options to purchase 188,000 shares of our common stock. (6) Excludes 22,851 unvested RSUs that vest 33% on each of May 31, 2024, 2025 and 2026 and 16.691 unvested RSUs that vest 50% on each of March 31, 2025 and 2026, subject to continued service on the vesting date, 23,536 unvested PSUs that vest on March 31, 2026, subject to achieving performance targets and continued service on the vesting date. (7) Excludes 38,853 unvested RSUs that vest 50% on each of December 21, 2024 and 2025, 3,130 unvested RSUs that fully vest on March 31, 2025, and 12,203 unvested RSUs that vest 50% on each of March 31, 2025 and 2026, subject to continued service on the vesting date, and 7,493 unvested MSUs that vest March 31, 2024, 9,392 unvested MSUs that vest March 31, 2025, subject to achieving stock price performance targets and continued service on the vesting date, and 18,304 unvested PSUs that vest on March 31, 2026, subject to achieving performance targets and continued service on the vesting date. (8) Excludes 6,974 unvested RSUs which vest 50% on each of March 31, 2025 and 2026, subject to continued service on the vesting date. (9) Includes 271,373 shares held directly by Mr. Ein and 3,005,117 shares held by Capitol Acquisition Management 2 LLC, of which Leland Investments Inc., an entity controlled by Mr. Ein, is the sole member. As a result, Mr. Ein has voting and dispositive control over such shares. Excludes 8,276 shares of restricted stock held by Mr. Ein that vests in full on August 8, 2024, subject to continued service on the vesting date, 10,867 unvested RSUs that vest December 31, 2024, 3,409 unvested RSUs that vest December 31, 2025 and 11,131 unvested RSUs that vest December 31, 2026, subject to continued service on the vesting date, that Mr. Ein elected to receive in lieu of cash Board Director fees for 2021, 2022 and 2023. (10) Excludes 8,276 shares of restricted stock that vests in full on August 8, 2024, subject to continued service on the vesting date. (11) Excludes 8,276 unvested RSUs that vest August 8, 2024, 5,691 unvested RSUs that vest December 31, 2024, 1,785 unvested RSUs that vest on December 31, 2025, and 5,830 unvested RSUs that vest December 31, 2026, subject to continued service on the vesting date, that Mr. Aronson elected to receive in lieu of cash Board Director fees for 2021, 2022 and 2023. (12) Includes 38,692 shares held directly by Mr. Bisnow, 9,784 shares held by Umbrella Holding Co. LLC, an entity directly controlled by Mr. Bisnow, and 2,446 shares held by Peak Street Management LLC, an entity directly controlled by Mr. Bisnow. As a result, Mr. Bisnow has voting and dispositive control over such shares. Excludes 8,276 shares of restricted stock that vests in full on August 8, 2024, subject to continued service on the vesting date. (13) Information from Schedule 13G/A filed on February 14, 2024. Ariel Investments, LLC, 200 E. Randolph Street, Suite 2900, Chicago, IL 60601. (14) MSD SIF Partners II LLC, 645 Fifth Avenue, 21st Floor, New York, NY 10022-5910 (15) Headlands Strategic Opportunities Fund LP, 370 Lexington Avenue, Suite 610, New York, NY 10017. (16) Moelis Dynasty Investments LLC, 11150 Santa Monica Blvd Suite 600, Los Angeles, CA 90025-0479. (17) Pimco Red Stick Fund LP, 650 Newport Center Drive, Newport Beach, CA 92660. Securities Authorized for Issuance under Equity Compensation Plans Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column) Equity compensation plans approved by security holders (1) 1,674,230 $ 10.97 3,740,389 (2) Equity compensation plans not approved by security holders N/A N/A N/A __________ (1) Information is as of December 31, 2023 (2) Consists of shares available for issuance under our 2021 Long-Term Incentive Plan. 78 Item 13. Certain Relationships and Related Transactions, and Director Independence Related Person Policy Our Code of Ethics requires us to avoid, wherever possible, all related party transactions that could result in actual or potential conflicts of interest, except under guidelines approved by the Board of Directors (or the Audit Committee). Related-party transactions are defined as transactions in which (1) the aggregate amount involved will or may be expected to exceed $120,000 in any calendar year, (2) we or any of our subsidiaries is a participant, and (3) any (a) executive officer, director or nominee for election as a director, (b) greater than 5% beneficial owner of our shares of common stock, or (c) immediate family member of the persons referred to in clauses (a) and (b) has or will have a direct or indirect material interest (other than solely as a result of being a director or a less than 10% beneficial owner of another entity). A conflict of interest situation can arise when a person takes actions or has interests that may make it difficult to perform his or her work objectively and effectively. Conflicts of interest may also arise if a person, or a member of his or her family, receives improper personal benefits as a result of his or her position. Our Audit Committee, pursuant to its written charter, is responsible for reviewing and approving related-party transactions to the extent we enter into such transactions. The Audit Committee will consider all relevant factors when determining whether to approve a related party transaction, including whether the related party transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances and the extent of the related party’s interest in the transaction. No director may participate in the approval of any transaction in which he is a related party, but that director is required to provide the Audit Committee with all material information concerning the transaction. Additionally, we require each of our directors and executive officers to complete an annual directors’ and officers’ questionnaire that elicits information about related party transactions. These procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer. Related Party Transactions Other than noted below, since January 1, 2023, we have not entered into, and there are no currently proposed, related party transactions. The daughter of John Fahey, a member of our Board of Directors and Compensation Committee Chair, was employed by us and transitioned to the chief of staff role during 2023. During 2023, she received aggregate compensation of $175,025, inclusive of salary, bonus and stock-based compensation. Director Independence The Board has determined that each of Mr. Aronson, Mr. Bisnow, Mr. Dryden, Mr. Ein, Mr. Fahey, Ms. Reynolds, Mr. Schultz and Mr. Smith qualifies as an “independent” director under the applicable definition of the listing standards of the Nasdaq Stock Market LLC (“Nasdaq”). Item 14. Principal Accountant Fees and Services INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM FEES AND SERVICES The following table provides information relating to the fees billed to us by Ernst & Young LLP for the years ended December 31, 2023 and 2022: 2023 2022 Audit fees (1) $ 830,000 $ 750,000 Audit-related fees (2) $ 360,500 $ - Tax fees $ 199,672 $ - All other fees $ - $ - (1) Audit fees consists of fees for professional services for the audit of our consolidated financial statements included in our Annual Report on Form 10-K and review of our condensed financial information included in our quarterly filings on Form 10-Q, including all services required to comply with the standards of the Public Company Accounting Oversight Board (United States), and fees associated with performing the integrated audit of internal controls over financial reporting (Sarbanes-Oxley Section 404 work). (2) Audit-related fees consist of professional services for procedures related to additional testing for software implementation and other one-time audit work. 79 Policy on Audit Committee Pre-Approval of Audit and Non-Audit Services The Audit Committee, in accordance with its charter, must pre-approve all non-audit services provided by our independent registered public accountants. The Audit Committee generally pre-approves specified services in the defined categories of audit services, audit related services and tax services up to specified amounts. Pre-approval may also be given as part of our Audit Committee’s approval of the scope of the engagement of the independent registered public accountants or on an individual, explicit case-by-case basis before the independent auditor is engaged to provide each service. All of the audit and non-audit related services provided by Ernst & Young LLP to us in 2023 and 2022 were approved by the Audit Committee by means of specific pre-approvals or otherwise in accordance with the Audit Committee Charter. 80 PART IV Item 15. Exhibits, Financial Statement Schedules (a) The following documents are filed as part of this Form 10-K or incorporated herein by reference: (1) Consolidated Financial Statements. See Index to Consolidated Financial Statements on page F-1. (2) Financial Statement Schedules. None. (3) Exhibits. The following exhibits are filed or incorporated by reference as part of this Form 10-K. Number Description Included Form Filing Date 3.1 Second Amended Certificate. By Reference DEFM 14-A June 24, 2015 3.2 Amended Bylaws By Reference 8-K March 26, 2020 3.3 Registration Rights Agreement by and between Lindblad Expeditions Holdings, Inc. and The Investors Party thereto. By Reference 8-K August 31, 2020 4.1 Specimen Common Stock Certificate. By Reference 8-K July 10, 2015 4.2 Securities Registered Pursuant to Section 12. By Reference 10-K February 26, 2020 4.3 Certificate of Designations of 6.0% Series A Convertible Preferred Stock of Lindblad Expeditions Holdings, Inc. By Reference 8-K August 31, 2020 4.4 Indenture, dated as of February 4, 2022, among Lindblad Expeditions, LLC, Lindblad Expeditions Holdings, Inc. and the other guarantors named therein and Wilmington Trust, National Association, as trustee and collateral trustee, relating to the 6.750% Senior Secured Notes due 2027. By Reference 8-K February 7, 2022 4.4.1 First Supplemental Indenture, dated May 2, 2023, to Indenture, dated as of February 4, 2022, among Lindblad Expeditions, LLC, Lindblad Expeditions Holdings, Inc. and the other guarantors named therein and Wilmington Trust, National Association, as trustee and collateral trustee, relating to the 6.750% Senior Secured Notes due 2027 . By Reference 10-Q May 3, 2023 4.5 Form of 6.750% Senior Secured Notes due 2027 ( included in Indenture, dated as of February 4, 2022, among Lindblad Expeditions, LLC, Lindblad Expeditions Holdings, Inc. and the other guarantors named therein and Wilmington Trust, National Association, as trustee and collateral trustee, relating to the 6.750% Senior Secured Notes due 2027. Exhibit ). By Reference 8-K February 7, 2022 4.6 Indenture, dated as of May 2, 2023, among the Issuer, each of the guarantors named therein and Wilmington Trust, National Association, as trustee and collateral agent, governing the terms of the Issuer’s $275,000,000 aggregate principal amount of 9.000% Senior Secured Notes due 2028. By Reference 8-K May 2, 2023 4.7 Form of 9.000% Senior Secured Notes due 2028 (included in Exhibit 4.6). By Reference 8-K May 2, 2023 10.1 Registration Rights Agreement among the Company and each of Capitol Acquisition Management 2 LLC, Lawrence Calcano, Richard C. Donaldson, Piyush Sodha and L. Dyson Dryden. By Reference 8-K May 15, 2013 10.2 2015 Long-Term Incentive Plan* By Reference DEFM 14-1 July 10, 2015 10.3 Non-Competition Agreement between Sven-Olof Lindblad and the Company. By Reference 8-K July 10, 2015 81 10.4 Employment Agreement between Trey Byus and the Company and Assignment and Assumption of Option Award Agreement.* By Reference 8-K July 10, 2015 10.5 Registration Rights Agreement between the shareholders of Lindblad Expeditions, Inc. and Capitol Acquisitions Corp. II. By Reference 8-K July 10, 2015 10.6 Brand License Agreement, dated as of November 14, 2023 . †# By Reference 8-K November 15, 2023 10.7 Lindblad 2012 Stock Incentive Plan .* By Reference 8-K July 10, 2015 10.8 Form of Executive Officer Stock Option Award Agreement. * By Reference 8-K October 30, 2015 10.9 Form of Non-Employee Director Restricted Stock Award Agreement. * By Reference 10-K March 14, 2016 10.1 0 Non-Employee Director Deferred Compensation Plan. * By Reference 10-K March 14, 2016 10.11 Employment Agreement by and between Natural Habitat, Inc., Lindblad Expeditions Holdings, Inc. and Ben Bressler. * By Reference 8-K May 5, 2016 10.12 Employment Agreement by and between Lindblad Expeditions Holdings, Inc. and Craig Felenstein. * By Reference 8-K July 27, 2016 10.1 3 Lindblad Expeditions Holdings, Inc. Employee Incentive Plan. * By Reference 8-K April 3, 2017 10.1 4 Form of Restricted Stock Unit Agreement. * By Reference 8-K April 3, 2017 10. 15 Form of Performance Share Unit Agreement. * By Reference 8-K April 3, 2017 10. 16 Amendment No. 1 dated as of September 4, 2018 to Employment Agreement between the Company and Dean (Trey) Byus. * By Reference 8-K September 6, 2018 10.1 7 Investment Agreement Dated as of August 26, 2020 by and among Lindblad Expeditions Holdings, Inc. and The Purchasers. By Reference 8-K August 27, 2020 10.1 8 Form of Market Stock Unit Award Agreement. By Reference 8-K October 5, 2020 10. 19 Amendment to Employment Agreement by and between Lindblad Expeditions Holdings, Inc. and Ben Bressler. * By Reference 10-Q May 6, 2020 10. 20 Amendment to Natural Habitat, Inc.’s Stockholders’ Agreement by and between Lindblad Expeditions Holdings, Inc., Natural Habitat, Inc. and Ben Bressler. By Reference 10-Q May 6, 2020 10.2 1 Lindblad Expeditions Holdings, Inc. 2021 Long Term Incentive Plan. * By Reference DEF 14A April 19, 2021 10. 22 Collateral Trust Agreement, dated as of February 4, 2022, by and among Lindblad Expeditions, LLC, Lindblad Expeditions Holdings, Inc., the other grantors party thereto, Wilmington Trust, National Association as trustee and collateral trustee, Credit Suisse AG, Cayman Islands Branch, as administrative agent under the Revolving Credit Agreement and each additional authorized representative from time to time party thereto. By Reference 8-K February 7, 2022 10. 23 Revolving Credit Agreement, dated as of February 4, 2022, by and among Lindblad Expeditions, LLC, Lindblad Expeditions Holdings, Inc., the lenders and other parties party thereto and Credit Suisse AG, Cayman Islands Branch, as administrative agent, and Credit Suisse Securities (USA) LLC, JPMorgan Chase Bank, N.A., and Citibank, N.A. as joint bookrunners, joint lead arrangers and syndication agents. By Reference 8-K February 7, 2022 10.24 Employment Agreement by and between Lindblad Expeditions Holdings, Inc. and Noah Brodsky. * By Reference 8-K May 31, 2022 10.25 Second Amendment to Stockholders Agreement by and among Lindblad Expeditions Holdings, Inc. Natural Habitat, Inc. and Ben Bressler. By Reference 8-K December 27, 2022 10.26 Amendment 2 to the Employment Agreement by and between Lindblad Expeditions Holdings, Inc. and Benjamin Bressler.* By Reference 8-K December 27, 2022 19.1 Company Insider Trading Policy Herewith 21.1 Subsidiaries. Herewith 82 23.1 Consent of Ernst & Young LLP. Herewith 23.2 Consent of Marcum LLP. Herewith 31.1 Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Herewith 31.2 Certification of Principal Financial and Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Herewith 32.1 Chief Executive Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Herewith 32.2 Chief Financial Officer Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. Herewith 97.1 Policy Relating to Recovery of Erroneously Awarded Compensation. Herewith 101.INS Inline XBRL Instance Document (the Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) Herewith 101.SCH Inline XBRL Taxonomy Extension Schema Document Herewith 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase Document Herewith 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase Document Herewith 101.LAB Inline XBRL Taxonomy Extension Label Linkbase Document Herewith 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase Document Herewith 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) * Management compensatory agreement. # Schedules and similar attachments to this Exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. Lindblad Expeditions Holdings, Inc. agrees to furnish supplementally a copy of any omitted schedule or exhibit to the U.S. Securities and Exchange Commission upon request. † Certain portions of this Exhibit have been redacted pursuant to Item 601(b)(10)(iv) of Regulation S-K. The omitted information is (i) not material and (ii) the type that the Company and Lindblad Expeditions Holdings, Inc. each treat as private or confidential. Lindblad Expeditions Holdings, Inc. agrees to furnish supplementally an unredacted copy of this Exhibit to the U.S. Securities and Exchange Commission upon request. Item 16. Form 10-K Summary None. 83 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf by the undersigned, thereunto duly authorized on March 6, 2024. LINDBLAD EXPEDITIONS HOLDINGS, INC. (Registrant) By: /s/ Sven Lindblad Sven Lindblad Chief Executive Officer (Principal Executive Officer) Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. Signature Title Date /s/ Sven Lindblad Chief Executive Officer and Director March 6, 2024 Sven Lindblad (Principal Executive Officer) /s/ Craig I. Felenstein Chief Financial Officer March 6, 2024 Craig I. Felenstein (Principal Financial and Accounting Officer) /s/ Bernard W. Aronson Director March 6, 2024 Bernard W. Aronson /s/ Elliott Bisnow Director March 6, 2024 Elliott Bisnow /s/ L. Dyson Dryden Director March 6, 2024 L. Dyson Dryden /s/ Mark D. Ein Chairman of the Board March 6, 2024 Mark D. Ein /s/ John M. Fahey Jr. Director March 6, 2024 John M. Fahey Jr. /s/ Catherine B. Reynolds Director March 6, 2024 Catherine B. Reynolds /s/ Alex Schultz Director March 6, 2024 Alex Schultz /s/ Thomas S. Smith, Jr. Director March 6, 2024 Thomas S. Smith, Jr. 84 LINDBLAD EXPEDITIONS HOLDINGS, INC. INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm (PCAOB ID 42 ) F-2 Report of Independent Registered Public Accounting Firm (PCAOB ID 688) F-4 Consolidated Balance Sheets as of December 31, 2023 and 2022 F-5 Consolidated Statements of Operations for the years ended December 31, 2023, 2022 and 2021 F-6 Consolidated Statements of Comprehensive Loss for the years ended December 31, 2023, 2022 and 2021 F-7 Consolidated Statements of Stockholders’ (Deficit) Equity for the years ended December 31, 2023, 2022 and 2021 F-8 Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022 and 2021 F-9 Notes to Consolidated Financial Statements F-10 F-1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Stockholders and the Board of Directors of Lindblad Expeditions Holdings, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Lindblad Expeditions Holdings, Inc. and subsidiaries as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive (loss) income, stockholders' (deficit) equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 6, 2024, expressed unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Unearned Passenger Revenue – Future Travel Certificates Description of the Matter As described in Note 2 to the consolidated financial statements, the Company records unearned passenger revenue when guests remit deposits in advance of tour embarkation. In conjunction with the suspension or rescheduling of tours, the Company has provided guests with future travel certificates, which in some instances exceeded the original cash deposit. The value of future travel certificates in excess of cash received, is being recognized as a discount to tour revenues at the time the related tour occurs. Future travel certificates are valued based on the Company’s expectation that a guest will travel again. Auditing the Company's accounting for the unearned passenger revenue related to future travel certificates was complex and challenging due to the estimation required by management to determine the value of unearned passenger revenue for future travel certificates, including the sensitivity of the value to the significant assumptions of repeat guests. F-2 How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company's process to determine the unearned passenger revenue value for future travel certificates, including the assumptions related to repeat guests and the completeness and accuracy of data utilized in such process. To test the unearned passenger revenue value for future travel certificates, we performed audit procedures that included, among others, evaluating the repeat guest assumption based on historical experience as well as testing the accuracy and completeness of the underlying data used in management's calculation. We also performed sensitivity analyses to evaluate the changes in the value of unearned passenger revenue of future travel certificates for changes in the Company’s significant assumption. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2022. Hartford, Connecticut March 6, 2023 F-3 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of Lindblad Expeditions Holdings, Inc. and Subsidiaries Opinion on the Financial Statements We have audited the accompanying consolidated statements of operations, comprehensive loss, stockholders’ deficit and cash flows of Lindblad Expeditions Holdings, Inc. and Subsidiaries (the “Company”) for the year ended December 31, 2021, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the results of its operations and its cash flows for the year ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. /s/ Marcum llp Marcum llp We have served as the Company’s auditor from 2015 to 2022 . Melville, NY February 28, 2022 F-4 LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES Consolidated Balance Sheets (In thousands, except share and per share data) As of December 31, 2023 2022 ASSETS Current Assets: Cash and cash equivalents $ 156,845 $ 87,177 Restricted cash 30,499 28,847 Short-term securities - 13,591 Prepaid expenses and other current assets 57,158 53,704 Total current assets 244,502 183,319 Property and equipment, net 526,002 539,406 Goodwill 42,017 42,017 Intangibles, net 9,412 11,219 Other long-term assets 9,364 12,014 Total assets $ 831,297 $ 787,975 LIABILITIES Current Liabilities: Unearned passenger revenues $ 252,199 $ 245,101 Accounts payable and accrued expenses 65,055 71,019 Long-term debt - current 47 23,337 Lease liabilities - current 1,923 1,663 Total current liabilities 319,224 341,120 Long-term debt, less current portion 621,778 529,452 Deferred tax liabilities 2,118 - Other long-term liabilities 1,943 3,049 Total liabilities 945,063 873,621 Commitments and contingencies - - Series A redeemable convertible preferred stock, 165,000 shares authorized; 62,000 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively 73,514 69,143 Redeemable noncontrolling interests 37,784 27,886 111,298 97,029 STOCKHOLDERS’ DEFICIT Preferred stock, $ 0.0001 par value, 1,000,000 shares authorized; 62,000 Series A shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively - - Common stock, $ 0.0001 par value, 200,000,000 shares authorized; 53,390,082 and 53,177,437 issued, 53,332,150 and 53,110,132 outstanding as of December 31, 2023 and December 31, 2022, respectively 5 5 Additional paid-in capital 97,139 83,850 Accumulated deficit ( 322,208 ) ( 266,530 ) Total stockholders' deficit ( 225,064 ) ( 182,675 ) Total liabilities, mezzanine equity and stockholders' deficit $ 831,297 $ 787,975 The accompanying notes are an integral part of these consolidated financial statements. F-5 LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Operations (In thousands, except share and per share data) For the years ended December 31, 2023 2022 2021 Tour revenues $ 569,543 $ 421,500 $ 147,107 Operating expenses: Cost of tours 322,376 283,217 124,484 General and administrative 118,431 96,291 65,445 Selling and marketing 71,426 60,996 28,484 Depreciation and amortization 46,711 44,042 39,525 Total operating expenses 558,944 484,546 257,938 Operating income (loss) 10,599 ( 63,046 ) ( 110,831 ) Other (expense) income: Interest expense, net ( 45,014 ) ( 37,495 ) ( 24,578 ) Gain (loss) on foreign currency 751 ( 1,236 ) ( 1,265 ) Other (expense) income ( 4,066 ) ( 307 ) 15,487 Total other expense ( 48,329 ) ( 39,038 ) ( 10,356 ) Loss before income taxes ( 37,730 ) ( 102,084 ) ( 121,187 ) Income tax expense (benefit) 3,146 6,076 ( 2,019 ) Net loss ( 40,876 ) ( 108,160 ) ( 119,168 ) Net income attributable to noncontrolling interest 4,734 3,221 38 Net loss attributable to Lindblad Expeditions Holdings, Inc. ( 45,610 ) ( 111,381 ) ( 119,206 ) Series A redeemable convertible preferred stock dividend 4,373 4,671 5,289 Non-cash deemed dividend - - 170 Net loss available to stockholders $ ( 49,983 ) $ ( 116,052 ) $ ( 124,665 ) Weighted average shares outstanding Basic 53,256,513 52,018,987 50,109,426 Diluted 53,256,513 52,018,987 50,109,426 Undistributed loss per share available to stockholders: Basic $ ( 0.94 ) $ ( 2.23 ) $ ( 2.41 ) Diluted $ ( 0.94 ) $ ( 2.23 ) $ ( 2.41 ) The accompanying notes are an integral part of these consolidated financial statements. F-6 LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Comprehensive (Loss) Income (In thousands) For the years ended December 31, 2023 2022 2021 Net loss $ ( 40,876 ) $ ( 108,160 ) $ ( 119,168 ) Other comprehensive income: Cash flow hedges: Net unrealized loss - - ( 1,682 ) Reclassification adjustment, net of tax - 634 2,650 Total other comprehensive income - 634 968 Total comprehensive loss ( 40,876 ) ( 107,526 ) ( 118,200 ) Less: comprehensive income attributive to non-controlling interest 4,734 3,221 38 Comprehensive loss attributable to stockholders $ ( 45,610 ) $ ( 110,747 ) $ ( 118,238 ) The accompanying notes are an integral part of these consolidated financial statements. F-7 LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Stockholders’ (Deficit) Equity (In thousands, except share data) Common Stock Additional Paid-In Accumulated Accumulated Other Comprehensive Total Stockholders' Shares Amount Capital Deficit Loss Equity (Deficit) Balance as of December 31, 2020 49,905,512 $ 5 $ 48,127 $ ( 11,572 ) $ ( 1,602 ) $ 34,958 Stock-based compensation - - 5,429 - - 5,429 Net activity related to equity compensation plans 246,608 - ( 2,221 ) - - ( 2,221 ) Issuance of stock for acquisition 82,302 - 1,770 - - 1,770 Issuance of stock for conversion of preferred stock 566,364 - 5,380 - - 5,380 Non-cash deemed dividend to preferred share holders - - - ( 170 ) - ( 170 ) Other comprehensive income, net - - - - 968 968 Redeemable noncontrolling interest - - - ( 202 ) - ( 202 ) Series A preferred stock dividend - - - ( 5,289 ) - ( 5,289 ) Net loss attributable to Lindblad Expeditions Holdings, Inc. - - - ( 119,206 ) - ( 119,206 ) Balance as of December 31, 2021 50,800,786 $ 5 $ 58,485 $ ( 136,439 ) $ ( 634 ) $ ( 78,583 ) Stock-based compensation - - 6,992 - - 6,992 Net activity related to equity compensation plans 267,090 - ( 1,056 ) - - ( 1,056 ) Issuance of stock for conversion of preferred stock 2,109,561 - 19,429 - - 19,429 Other comprehensive income, net - - - - 634 634 Redeemable noncontrolling interest - - - ( 14,039 ) - ( 14,039 ) Series A preferred stock dividend - - - ( 4,671 ) - ( 4,671 ) Net loss attributable to Lindblad Expeditions Holdings, Inc. - - - ( 111,381 ) - ( 111,381 ) Balance as of December 31, 2022 53,177,437 $ 5 $ 83,850 $ ( 266,530 ) $ - $ ( 182,675 ) Stock-based compensation - - 13,886 - - 13,886 Net activity related to equity compensation plans 212,645 - ( 597 ) - - ( 597 ) Redeemable noncontrolling interest - - - ( 5,695 ) - ( 5,695 ) Series A preferred stock dividend - - - ( 4,373 ) - ( 4,373 ) Net loss attributable to Lindblad Expeditions Holdings, Inc. - - - ( 45,610 ) - ( 45,610 ) Balance as of December 31, 2023 53,390,082 $ 5 $ 97,139 $ ( 322,208 ) $ - $ ( 225,064 ) The accompanying notes are an integral part of these consolidated financial statements. F-8 LINDBLAD EXPEDITIONS HOLDINGS, INC. AND SUBSIDIARIES Consolidated Statements of Cash Flows (In thousands) For the years ended December 31, 2023 2022 2021 Cash Flows From Operating Activities Net loss $ ( 40,876 ) $ ( 108,160 ) $ ( 119,168 ) Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation and amortization 46,711 44,042 39,525 Amortization of deferred financing costs and other, net 3,368 2,669 3,203 Amortization of right-to-use lease assets 811 608 21 Stock-based compensation 13,886 6,992 5,563 Deferred income taxes 2,719 5,481 ( 833 ) (Gain) loss on foreign currency ( 751 ) 1,236 1,265 Write-off of unamortized issuance costs related to debt refinancing 3,860 9,004 - Changes in operating assets and liabilities Prepaid expenses and other current assets ( 3,454 ) ( 19,695 ) ( 11,768 ) Unearned passenger revenues 7,098 32,503 83,946 Other long-term assets ( 1,871 ) 2,556 ( 684 ) Other long-term liabilities - 689 6,140 Accounts payable and accrued expenses ( 5,210 ) 20,530 25,285 Operating lease liabilities ( 850 ) ( 658 ) - Net cash provided by (used in) operating activities 25,441 ( 2,203 ) 32,495 Cash Flows From Investing Activities Purchases of property and equipment ( 29,963 ) ( 38,205 ) ( 96,688 ) Sale (purchase) of securities 15,163 ( 15,000 ) - Proceeds from loan principal repayment - 3,610 - Acquisition (net of cash acquired) - - ( 18,036 ) Net cash used in investing activities ( 14,800 ) ( 49,595 ) ( 114,724 ) Cash Flows From Financing Activities Proceeds from long-term debt 275,000 360,000 61,720 Repayments of long-term debt ( 205,704 ) ( 352,941 ) ( 5,957 ) Payment of deferred financing costs ( 7,489 ) ( 10,874 ) ( 3,135 ) Repurchase under stock-based compensation plans and related tax impacts ( 1,128 ) ( 1,056 ) ( 2,221 ) Net cash provided by (used in) financing activities 60,679 ( 4,871 ) 50,407 Net increase (decrease) in cash, cash equivalents and restricted cash 71,320 ( 56,669 ) ( 31,822 ) Cash, cash equivalents and restricted cash at beginning of period 116,024 172,693 204,515 Cash, cash equivalents and restricted cash at end of period $ 187,344 $ 116,024 $ 172,693 Supplemental disclosures of cash flow information: Cash paid during the period: Interest $ 43,695 $ 25,815 $ 18,260 Income taxes 711 309 98 Non-cash investing and financing activities: Non-cash preferred stock dividend 4,373 4,671 $ 5,289 Value of shares issued for acquisition - - 1,770 Non-cash preferred stock deemed dividend - - 170 The accompanying notes are an integral part of these consolidated financial statements. F-9 Lindblad Expeditions Holdings, Inc. Notes to the Consolidated Financial Statements NOTE 1 — BUSINESS Organization Lindblad Expeditions Holdings, Inc. and its consolidated subsidiaries’ (the “Company” or “Lindblad”) mission is offering life-changing adventures around the world and pioneering innovative ways to allow its guests to connect with exotic and remote places. The Company currently operates a fleet of ten owned expedition ships and six seasonal charter vessels under the Lindblad brand, operates land-based, eco-conscious expeditions and active nature focused trips and tours under the Natural Habitat, Inc. (“Natural Habitat”) and Off the Beaten Path, LLC (“Off the Beaten Path”) brands, operates luxury cycling and adventure tours under the DuVine Cycling + Adventure Company (“DuVine”) brand, and designs handcrafted walking tours under the Classic Journeys, LLC (“Classic Journeys”) brand. The Company operates the following reportable business segments: Lindblad Segment. The Lindblad segment primarily provides ship-based expeditions aboard customized, nimble and intimately-scaled vessels that are able to venture where larger cruise ships cannot, thus allowing Lindblad to offer up-close experiences in the planet’s wild and remote places and capitals of culture. Each expedition ship is fully equipped with state-of-the-art tools for in-depth exploration and the majority of expeditions involve travel to remote places with limited infrastructure and ports, such as Antarctica and the Arctic, or places that are best accessed by a ship, such as the Galápagos Islands, Alaska, Baja California’s Sea of Cortez and Panama, and foster active engagement by guests. The Company has an agreement with National Geographic Partners, LLC (“National Geographic”), which provides for lecturers and National Geographic experts, including photographers, writers, marine biologists, naturalists, field researchers and film crews, to join many of the Company’s expeditions. Land Experiences Segment . The Land Experiences segment includes our four primarily land-based brands, Natural Habitat, DuVine, Off the Beaten Path and Classic Journeys. Natural Habitat offers over 100 different expedition itineraries in more than 45 countries spanning all seven continents, with eco-conscious expeditions and nature-focused, small-group tours that include polar bear tours in Churchill, Canada, Alaskan grizzly bear adventures, small-group Galápagos Islands tours and African safaris. Natural Habitat has partnered with World Wildlife Fund (“WWF”) to offer conservation travel, which is sustainable travel that contributes to the protection of nature and wildlife. Off the Beaten Path offers active small-group adventures, led by local, experienced guides, with distinct focus on wildlife, hiking national parks and culture. Off the Beaten Path offerings include insider national park experiences in the Rocky Mountains, Desert Southwest, and Alaska, as well as unique trips across Central and South America, Oceania, Europe and Africa. DuVine offers intimate group cycling and adventure tours around the world with local cycling experts as guides, immersive in local cultural, cuisine and high-quality accommodations. International cycling tours include the exotic Costa Rican rainforests, the rocky coasts of Ireland and the vineyards of Spain while cycling adventures in the United States include cycling beneath the California redwoods, pedaling through Vermont farmland and wine tastings in the world-class vineyards of Napa and Sonoma. Classic Journeys offers highly curated active small-group and private custom journeys centered around cinematic walks led by expert local guides in over 50 countries around the world. These walking tours are highlighted by expert local guides, luxury boutique accommodations, and handcrafted itineraries that immerse guests into the history and culture of the places they are exploring and the people who live there. F- 10 NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The consolidated financial statements include the accounts of the Company after elimination of all intercompany accounts and transactions. The consolidated financial statements and accompanying footnotes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (the “SEC”). The presentation of prior period marine operating supply and inventory on the consolidated balance sheets has been combined with prepaid expenses and other current assets to conform to the 2023 presentation, with related impact to the consolidated statement of cash flows, which had no effect on previously reported current asses or total assets. Use of Estimates The preparation of consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities as well as revenues and expenses and related disclosures. Actual results could differ from such estimates. Management estimates include determining the estimated lives of long-lived and intangible assets, the valuation of stock-based compensation awards, future travel certificate breakage, annual goodwill impairment assessment, and the recovery of deferred tax assets. Estimates and assumptions are reviewed periodically and the effects of revisions are reflected in the consolidated financial statements in the period that they are determined to be necessary. Revenue Recognition Revenues are measured based on consideration specified in the Company’s contracts with guests and are recognized as the related performance obligations are satisfied. The majority of the Company’s revenues are derived from guest ticket contracts which are reported as tour revenues. The Company’s primary performance obligation under these contracts is to provide an expedition, trip or tour, and may include pre- and post-expedition excursions, hotel accommodations, land-based expeditions and air transportation to and from the ships or the trip or tour beginning or end point. Upon satisfaction of the Company’s primary performance obligation, revenue is recognized over the duration of each expedition, trip or tour. Tour revenues also include revenues from the sale of goods and services onboard the Company’s ships, cancellation fees and trip insurance. Revenues from the sale of goods and services rendered onboard are recognized upon purchase. Guest cancellation fees are recognized as tour revenues at the time of the cancellation. The Company records a liability for estimated trip insurance claims based on the Company’s claims history. Proceeds received from trip insurance premiums in excess of this liability are recorded as revenue in the period in which they are received. The Company sources its guest bookings through a combination of direct selling and various agency networks and alliances. The following table disaggregates tour revenues by the sales channel it was derived from: For the years ended December 31, 2023 2022 2021 Guest ticket revenue: Direct 53 % 50 % 56 % National Geographic 12 % 14 % 14 % Agencies 19 % 20 % 18 % Affinity 6 % 5 % 5 % Guest ticket revenue 90 % 89 % 93 % Other tour revenue 10 % 11 % 7 % Tour revenues 100 % 100 % 100 % Customer Deposits and Contract Liabilities The Company’s guests remit deposits in advance of tour embarkation. Guest deposits consist of guest ticket revenues as well as revenues from the sale of pre- and post-expedition excursions, hotel accommodations, land-based expeditions and certain air transportation. Guest deposits represent unearned revenues and are reported as unearned passenger revenues when received and are subsequently recognized as tour revenue over the duration of the expedition. The Company does not consider guest deposits to be a contract liability until the guest no longer has the right, resulting from the passage of time, to cancel their reservation and receive a full refund. Guests were previously provided an option of either a refund or future travel certificates, which in some instances the value of the future travel certificate exceeded the original cash deposit. The value of future travel certificates in excess of cash F- 11 received is being recognized as a discount to tour revenues at the time the related expedition occurs and includes an estimate of breakage based on historical behavior of the customer and/or time to expiration of the certificate. As of December 31, 2023 and 2022 the Company has recorded $ 252.2 million and $ 245.1 million, related to unearned passenger revenue, respectively. The change in contract liabilities within unearned passenger revenues are as follows: Contract Liabilities (In thousands) Balance as of December 31, 2022 $ 178,198 Recognized in tour revenues during the period ( 548,052 ) Additional contract liabilities in period 463,760 Balance as of December 31, 2023 $ 93,906 Cost of Tours Cost of tours represents the direct costs associated with revenues during expeditions, trips and tours, including costs of pre- or post-expedition excursions, hotel accommodations, land-based expeditions, air and other transportation expenses and costs of goods and services rendered onboard, payroll and related expenses for shipboard, guides and expedition personnel, food costs for guests and crew, fuel and related costs and other expenses such as land costs, port costs, repairs and maintenance, equipment expense, drydock, ship insurance and charter hire expenses. General and Administrative Expense General and administrative expenses primarily represent the costs of the Company’s shore-side vessel support, credit card commissions, reservations and other administrative functions, and includes salaries and related benefits, professional fees and occupancy costs. Selling and Marketing Expense Selling and marketing expenses include commissions, royalties and a broad range of advertising and marketing expenses. These include advertising costs of direct mail, email, digital media, traditional media, travel agencies and brand websites, as well as costs associated with website development and maintenance, social media and corporate sponsorship costs. Advertising is charged to expense as incurred. Advertising expenses totaled $ 33.2 million, $ 31.6 million and $ 19.1 million for the years ended December 31, 2023, 2022 and 2021, respectively. The largest component of advertising expense for each of the years ended December 31, 2023, 2022 and 2021 was online advertising, which totaled $ 17.3 million, $ 14.7 million and $ 9.8 million, respectively. Cash and Cash Equivalents The Company considers all highly liquid instruments with an original maturity of six months or less, as well as deposits in financial institutions, to be cash and cash equivalents. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheet that sum to the total of the same such amounts shown in the statement of cash flows: As of December 31, 2023 2022 2021 (In thousands) Cash and cash equivalents $ 156,845 $ 87,177 $ 150,753 Restricted cash 30,499 28,847 21,940 Total cash, cash equivalents and restricted cash as presented in the statement of cash flows $ 187,344 $ 116,024 $ 172,693 Concentration of Credit Risk The Company maintains cash in several financial institutions in the U.S. and other countries which, at times, may exceed the federally insured limits. Accounts held in the U.S. are guaranteed by the Federal Deposit Insurance Corporation up to certain limits. As of December 31, 2023 and 2022, the Company’s cash held in financial institutions outside of the U.S. amounted to $ 5.8 million and $ 3.3 million, respectively. F- 12 Restricted Cash and Marketable Securities The amounts held in restricted cash represent principally funds required to be held by certain vendors and regulatory agencies and are classified as restricted cash since such amounts cannot be used by the Company until the restrictions are removed by those vendors and regulatory agencies. These amounts are principally held in certificates of deposit and interest income is recognized when earned. In order to operate guest tour expedition vessels from U.S. ports, the Company is required to either post a performance bond with the Federal Maritime Commission or escrow all unearned guest deposits plus an additional 10% in restricted accounts, up to a maximum of $ 32 million. To satisfy this requirement, the Company entered into an agreement with a financial institution to escrow the required amounts. Restricted cash and marketable securities consist of the following: As of December 31, 2023 2022 (In thousands) Credit card processor reserves $ 20,250 $ 20,400 Federal Maritime Commission and other escrow 8,958 6,882 Certificates of deposit and other restricted securities 1,291 1,565 Total restricted cash $ 30,499 $ 28,847 The Company has classified marketable securities, principally money market funds or other short-term investments, as trading securities which are recorded at market value. Unrealized gains and losses are included in current operations. Gains and losses on the disposition of securities are recognized by the specific identification method in the period in which they occur. Cost of these short-term investments approximates fair value. Prepaid Expenses and Other Current Assets The Company records prepaid expenses and other current assets at cost and expenses them in the period the services are provided or the goods are delivered. Marine operating supplies and inventories are included in prepaid expenses and other current assets and consist primarily of fuel, provisions, gift shop merchandise and other items for resale, other supplies used in the operation of marine expeditions. Fuel, provisions and other supplies are recorded at cost while items for sale are stated at the lower of cost or net realizable value and their cost is determined using the first -in, first -out method. The Company’s prepaid expenses and other current assets consist of the following: As of December 31, 2023 2022 (In thousands) Prepaid tour expenses $ 26,123 $ 20,605 Marine operating supplies 5,438 9,961 Other 25,597 21,173 Total prepaid expenses and other current assets $ 57,158 $ 53,704 Property and Equipment, net Property and equipment, net is stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, as follows: Years Vessels and vessel improvements 15 - 25 Furniture & equipment 5 Computer hardware and software 5 - 10 Leasehold improvements, including expedition sites and port facilities Shorter of lease term or related asset life F- 13 The ship-based tour and expedition industry is very capital intensive. As of December 31, 2023, the Company owned and operated ten expedition vessels. The Company has a capital program for the improvement of its vessels and for asset replacements in order to enhance the effectiveness and efficiency of its operations; comply with, or exceed all relevant legal and statutory requirements related to health, environment, safety, security and sustainability; and gain strategic benefits or provide newer improved product innovations to its guests. Vessel improvement costs that add value to the Company’s vessels, such as those discussed above, are capitalized and depreciated over the shorter of the improvements, or the vessel’s estimated remaining useful life, while costs of repairs and maintenance, including minor improvement costs and drydock expenses, are charged to expense as incurred and included in cost of tours. Drydock costs primarily represent planned maintenance activities that are incurred when a vessel is taken out of service. For U.S. flagged ships, the statutory requirement traditionally is an annual docking and U.S. Coast Guard inspections, normally conducted in drydock. Internationally flagged ships have scheduled dockings approximately every 12 months, for a period of up to three to six weeks. Goodwill The Company tests for impairment annually as of September 30, or more frequently if warranted. The Company assesses qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the estimated fair value of goodwill is less than its carrying amount. The Company completed the annual impairment test as of September 30, 2023 with no indication of goodwill impairment. See Note 5—Goodwill and Intangible Assets for further details on the Company’s goodwill. Intangible Assets, net Intangible assets include tradenames, customer lists and operating rights. Tradenames are words, symbols, or other devices used in trade or business to indicate the source of products and to distinguish it from other products and are registered with government agencies and are protected legally by continuous use in commerce. Customer lists are established relationships with existing customers that resulted in repeat purchases and customer loyalty. Based on the Company’s analysis, amortization of the tradenames and customer lists were computed using the estimated useful lives of 15 and 5 years, respectively. See Note 5—Goodwill and Intangible Assets for further information on the Company’s intangible assets. The Company operates two vessels year-round in the Galápagos National Park in Ecuador, the National Geographic Endeavour II with 96 berths and the National Geographic Islander II with 48 berths. In order to operate these vessels within the park, the Company is required to have in its possession cupos (licenses) sufficient to cover the total available berths on each vessel. The cupos expire in 2042, and have a renewable 20 -year term, subject to early termination by the Ecuadorean Province of Galápagos government for non-compliance with the terms of the contract and applicable law regulations. Upon the occurrence of a triggering event, the assessment of possible impairment of the Company’s intangible assets will be based on the Company’s ability to recover the carrying value of its asset, which is determined by using the asset’s estimated undiscounted future cash flows. If these estimated undiscounted future cash flows are less than the carrying value of the asset, an impairment charge is recognized for the excess, if any, of the asset’s carrying value over its estimated fair value. A significant amount of judgment is required in estimating the future cash flows and fair values of its tradenames, customer lists and operating rights. As of and for the year ended December 31, 2023 and 2022, the Company determined that there were no triggering events regarding its intangible assets. Long-Lived Asset Impairment Assessment The Company reviews its long-lived assets, principally its vessels, for impairment whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. Upon the occurrence of a triggering event, the assessment of possible impairment is based on the Company’s ability to recover the carrying value of its asset, which is determined by using the asset’s estimated undiscounted future cash flows. If these estimated undiscounted future cash flows are less than the carrying value of the asset, an impairment charge is recognized for the excess of the asset’s carrying value over its estimated fair value. A significant amount of judgment is required in estimating the future cash flows and fair values of its vessels. As of and for the years December 31, 2023 and 2022, the Company determined that there were no triggering events regarding its long-lived assets. F- 14 Accounts Payable and Accrued Expenses The Company records accounts payable and accrued expenses for the cost of such items when the service is provided or when the related product is delivered. The Company’s accounts payable and accrued expenses consist of the following: As of December 31, 2023 2022 (In thousands) Accrued other expense $ 48,901 $ 54,418 Accounts payable 16,154 16,601 Total accounts payable and accrued expenses $ 65,055 $ 71,019 Leases The Company leases office and warehousing space with lease terms ranging from one to ten years, and computer hardware and software and office equipment with lease terms ranging from three to six years. At the inception of a lease, the Company recognizes right-of-use lease assets and related lease liabilities measured as the present value of future lease payments. The Company's right-of-use lease assets are recorded in other long-term assets and the Company's long-term lease liabilities are recorded in other long-term liabilities. Lease expense is recognized on a straight-line basis over the term of the lease. The Company reviewed its contracts with vendors and customers, determining that its right-to-use lease assets consisted primarily of office space operating leases. In determining the right-to-use lease assets and related lease liabilities, the Company did not recognize any lease extension options and elected to exclude leases with terms of 12 -months or less. Short-term leases are accounted for monthly over the lease term. Fair Value Measurements Fair value is defined as an exit price, representing the amount that would be received upon the sale of an asset or payment to transfer a liability in an orderly transaction between market participants. Fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. A three -tier fair value hierarchy is used to prioritize the inputs in measuring fair value as follows: Level 1 Quoted market prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at measurement date. Level 2 Quoted market prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable, either directly or indirectly. Fair value is determined through the use of models or other valuation methodologies. Level 3 Significant unobservable inputs for assets or liabilities that cannot be corroborated by market data. Fair value is determined by the reporting entity’s own assumptions utilizing the best information available and includes situations where there is little market activity for the investment. Level 3 financial liabilities consist of obligations for which there is no current market for these securities such that the determination of fair value requires significant judgment or estimation. Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. The asset’s or liability’s fair value measurement within the fair value hierarchy is based upon the lowest level of any input that is significant to the fair value measurement. Derivative Instruments and Hedging Activities Currency Risk . The Company uses currency exchange contracts to manage its exposure to changes in currency exchange rates associated with certain of its non-U.S. dollar denominated receivables and payables. The Company primarily hedges a portion of its current-year currency exposure to several currencies, which normally include, but are not limited to, the Canadian and New Zealand dollars, the euro and the British pound sterling. The fluctuations in the value of these forward contracts largely offset the impact of changes in the value of the underlying risk they economically hedge. The Company also uses foreign exchange forward contracts, designated as cash flow hedges, from time-to-time as necessary, to manage its exposure to foreign denominated contracts. F- 15 By entering into derivative instrument contracts, the Company exposes itself, from time to time, to counterparty credit risk. Counterparty credit risk is the failure of the counterparty to perform under the terms of the derivative contract. When the fair value of a derivative contract is in an asset position, the counterparty has a liability to the Company, which creates credit risk for the Company. The Company continues to monitor counterparty credit risk as part of its ongoing derivative assessments. The Company’s derivative assets and liabilities consist principally of currency exchange contracts, which are carried at fair value based on significant observable inputs (Level 2 inputs). Derivatives entered into by the Company are typically executed over-the-counter and are valued using quoted market prices for similar assets or liabilities when available or internal valuation techniques, when quoted market prices are not readily available. The valuation technique and inputs depend on the type of derivative and the nature of the underlying exposure. The Company principally uses discounted cash flows along with fair value models that primarily use market observable inputs. These models take into account a variety of factors including, where applicable, maturity, currency exchange rates, interest rate yield curves and counterparty credit risks. The Company records derivatives on a gross basis in other long-term assets and/or other liabilities. The accounting for changes in value of the derivative depends on whether or not the transaction has been designated and qualifies for hedge accounting. Derivatives that are not designated for hedge accounting are reported and measured at fair value through earnings. The Company applies hedge accounting to interest rate and foreign exchange rate derivatives entered into for risk management purposes. To qualify for hedge accounting, a derivative must be highly effective at reducing the risk associated with the exposure being hedged. In addition, key aspects of achieving hedge accounting are documentation of hedging strategy and hedge effectiveness at the hedge inception and substantiating hedge effectiveness on an ongoing basis. A derivative must be highly effective in accomplishing the hedge objective of offsetting changes in the cash flows of the hedged item for the risk being hedged. The effective portion of changes in the fair value of derivatives designated in a hedge relationship and that qualify as cash flow hedges is recorded in accumulated other comprehensive income, net of tax, and is subsequently reclassified into earnings in the period that the hedged transaction affects earnings. The Company formally documents the relationship between derivatives and hedged items, as well as the risk-management objective and the strategy for undertaking hedge transactions at the inception of the hedging relationship. This documentation includes linking cash flow hedges to specific assets and liabilities on the balance sheet or to specific forecasted transactions. The Company also formally assesses, both at the hedge’s inception and on an ongoing basis, whether the derivative instruments that are used are highly effective in offsetting changes in fair values or cash flows of the hedged items. Income Taxes The Company is subject to income taxes in both the U.S. and the non-U.S. jurisdictions in which it operates. Significant management judgment is required in projecting ordinary income to determine the Company’s estimated effective tax rate. The Company accounts for income taxes using the asset and liability method, under which it recognizes deferred income taxes for the tax consequences attributable to differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities, as well as for tax loss carryforwards and tax credit carryforwards. The Company measures deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recoverable or settled. The Company provides a valuation allowance against deferred tax assets if, based upon the weight of available evidence, the Company does not believe it is “more-likely-than- not” that some or all of the deferred tax assets will be realized. The Company will continue to evaluate the deferred tax asset valuation allowance balances in all of its foreign and U.S. companies to determine the appropriate level of valuation allowances. The Company regularly assesses the potential outcome of current and future examinations in each of the taxing jurisdictions when determining the adequacy of the provision for income taxes. The Company has only recorded financial statement benefits for tax positions which it believes are “more-likely-than- not” to be sustained. The Company is subject to tax audits in all jurisdictions for which it files tax returns. Tax audits by their very nature are often complex and can require several years to complete. Currently, there are no U.S. federal, state or foreign jurisdiction tax audits pending. The Company’s corporate U.S. federal and state tax returns for the current year and four prior years remain subject to examination by tax authorities and the Company’s foreign tax returns for the current year and five prior years remain subject to examination by tax authorities. F- 16 Other Long-Term Assets Other long-term assets include the Company’s right-to-use lease assets, deferred tax assets and long-term prepaid value-added taxes, which include those related to the importation of the National Geographic Islander II and the National Geographic Endeavour II . The Company expects to earn tax credits over time that will reduce the value-added taxes and has applied for such tax credits with the Ecuadorian tax authorities. Deferred Financing Costs Deferred financing costs relate to the issuance costs of debt liabilities and are a direct deduction from the debt carrying amount. Deferred financing costs are amortized over the life of the debt or loan agreement through interest expense, net. See Note 6—Long -term Debt. Foreign Currency Translation The Company’s functional currency is the U.S. dollar. Any foreign operations and remeasurement adjustments and gains or losses resulting from foreign currency transactions are recorded as foreign exchange gains or losses. Stock-Based Compensation Stock-based compensation awards issued to employees, non-employee directors or other service providers are recorded at their fair value on the date of grant and amortized over the service period of the award. The Company recognizes stock-based compensation costs on a straight-line basis over the requisite service period of the award, which is generally the vesting term of the equity instrument issued, within general and administrative expenses. Series A Redeemable Convertible Preferred Stock The Company’s Series A redeemable convertible preferred stock (“Preferred Stock”) is accounted for as a temporary equity instrument. The redemption or conversion of the Preferred Stock into shares of the Company’s common stock is not solely controlled by the Company. At the six -year anniversary of the issuance, the holders have the right to require the Company to repurchase their Preferred Stock. The Preferred Stock is convertible into the Company’s common stock (i) any time at the holder’s election, (ii) at the six -year anniversary of the issuance of those shares not redeemed at the request of the holder, or (iii) by the Company under certain circumstances. See Note 11—Stockholders’ Equity. Recent Accounting Pronouncements During November 2023, Financial Accounting Standards Board (“FASB”) issued ASU 2023 - 07 ― Segment Reporting (Topic 280 ) – Improvements to Reportable Segment Disclosures . The amendments in this ASU are intended to improve and enhance disclosures about reportable segments’ significant segment expenses. ASU 2023 - 07 is effective for fiscal years beginning after December 15, 2023 and interim periods beginning after December 15, 2024. The Company will adopt this guidance January 1, 2024 for its annual reporting, and January 1, 2025 for its interim reporting, as required. These amendments will increase the Company’s reportable segment disclosures. During December 2023, FASB issued ASU 2023 - 09 ― Income Taxes (Topic 740 ) – Improvements to Income Tax Disclosures . The amendments in this ASU are intended to enhance the transparency and decision usefulness of income tax disclosures. ASU 2023 - 09 is effective for fiscal years beginning after December 15, 2024. The Company will adopt this guidance January 1, 2025 for its annual reporting, as required. These amendments will increase the Company’s disclosures related to income taxes. F- 17 NOTE 3 — EARNINGS PER SHARE Earnings per common share is computed using the two -class method related to its Preferred Stock. Under the two -class method, undistributed earnings available to stockholders for the period are allocated on a pro rata basis to the common stockholders and to the holders of convertible preferred shares based on the weighted average number of common shares outstanding and number of shares that could be issued upon conversion of the Preferred Stock. Diluted earnings per share is computed using the weighted average number of common shares outstanding and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the dilutive incremental common shares associated with restricted stock awards, shares issuable upon the exercise of stock options, using the treasury stock method, and the potential common shares that could be issued from conversion of the Preferred Stock, using the if-converted method. When a net loss occurs, potential common shares have an anti-dilutive effect on earnings per share and such shares are excluded from the diluted earnings per share calculation. For the years ended December 31, 2023, 2022 and 2021, the Company incurred a net loss from operations, therefore potential common shares were excluded from the diluted earnings per share calculation. For the year ended December 31, 2023, 0.8 million restricted shares, 0.2 million options and 8.0 million common shares issuable upon the conversion of the Preferred Stock were excluded. For the year ended December 31, 2022, 0.7 million restricted shares, 1.5 million options and 7.4 million common shares issuable upon the conversion of the Preferred Stock were excluded, and for the year ended December 31, 2021, 0.8 million restricted shares, 1.5 million options and 9.1 million common shares issuable upon the conversion of the Preferred Stock were excluded. For the years ended December 31, 2023, 2022 and 2021, the Company calculated earnings per share as follows: For the years ended December 31, 2023 2022 2021 (In thousands, except share and per share data) Net loss attributable to Lindblad Expeditions Holdings, Inc. $ ( 45,610 ) $ ( 111,381 ) $ ( 119,206 ) Series A redeemable convertible preferred stock dividend 4,373 4,671 5,289 Non-cash deemed dividend to preferred share holders - - 170 Undistributed loss available to stockholders $ ( 49,983 ) $ ( 116,052 ) $ ( 124,665 ) Weighted average shares outstanding: Total weighted average shares outstanding, basic 53,256,513 52,018,987 50,109,426 Total weighted average shares outstanding, diluted 53,256,513 52,018,987 50,109,426 Undistributed loss per share available to stockholders: Basic $ ( 0.94 ) $ ( 2.23 ) $ ( 2.41 ) Diluted $ ( 0.94 ) $ ( 2.23 ) $ ( 2.41 ) NOTE 4 — PROPERTY AND EQUIPMENT, NET Property and equipment, net are as follows: As of December 31, 2023 2022 (In thousands) Vessels and improvements $ 776,622 $ 759,981 Furniture and equipment 42,055 28,732 Leasehold improvements 1,424 1,426 Total property and equipment, gross 820,101 790,139 Less: Accumulated depreciation ( 294,099 ) ( 250,733 ) Property and equipment, net $ 526,002 $ 539,406 Total depreciation expense of the Company’s property and equipment for the years ended December 31, 2023, 2022 and 2021 was $ 44.9 million, $ 41.0 million and $ 37.6 million, respectively. F- 18 For the year ended December 31, 2023, the Company had $ 30.0 million in capital expenditures, which primarily includes vessel improvement projects and digital investments. For the year ended December 31, 2022, the Company had $ 38.2 million in capital expenditures and primarily included renovations of the National Geographic Islander II , which launched in the Galápagos Islands during the third quarter of 2022, replacing the National Geographic Islander . NOTE 5 — GOODWILL AND INTANGIBLE ASSETS The Company's goodwill relates to the acquisition of its Land Experiences Segment subsidiaries, see Note 9—Acquisitions. The following is a rollforward of the Company’s goodwill: (In thousands) Land Experiences Segment Balance as of December 31, 2020 $ 22,105 Acquisitions 19,912 Balance as of December 31, 2021 42,017 Activity - Balance as of December 31, 2022 42,017 Activity - Balance as of December 31, 2023 $ 42,017 The Company’s intangible assets consist of finite lived assets related to the acquisition of its Land Experiences Segment subsidiaries and the value of its cupos operating rights. Total amortization expense for the years ended December 31, 2023, 2022 and 2021, was $ 1.8 million, $ 2.0 million and $ 1.9 million, respectively. The carrying amounts and accumulated amortization of intangibles, net are as follows: As of December 31, 2023 2022 (In thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Useful Life Remaining (years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Tradenames $ 7,069 $ ( 2,222 ) $ 4,847 10.3 $ 7,069 $ ( 1,751 ) $ 5,318 Customer Lists 6,182 ( 3,209 ) 2,973 2.4 6,182 ( 1,961 ) 4,221 Operating rights 6,529 ( 4,937 ) 1,592 18.2 6,529 ( 4,849 ) 1,680 Total intangibles, net $ 19,780 $ ( 10,368 ) $ 9,412 9.1 $ 19,780 $ ( 8,561 ) $ 11,219 Future expected amortization expense related to these intangibles are as follows: Year Amount (In thousands) 2024 $ 1,795 2025 1,795 2026 1,059 2027 559 2028 559 Thereafter 3,645 $ 9,412 F- 19 NOTE 6 — LONG-TERM DEBT 6.75% Notes On February 4, 2022, the Company issued $ 360.0 million aggregate principal amount of 6.75 % senior secured notes due 2027 (the “6.75% Notes”) in a private offering. The 6.75% Notes bear interest at a rate of 6.75% per year, accruing from February 4, 2022, and interest on the 6.75% Notes is payable semiannually in arrears on February 15 and August 15 of each year. The 6.75% Notes will mature on February 15, 2027, subject to earlier repurchase or redemption. The Company used the net proceeds from the offering to prepay in full all outstanding borrowings under its prior credit agreement, including the term facility, Main Street Expanded Loan Facility, and former revolving credit facility, pay any related premiums and terminate in full its prior credit agreement and the commitments thereunder. The Company incurred $ 10.9 million in financing fees related to the 6.75% Notes, recorded as deferred financing costs as part of long-term debt. The 6.75% Notes are senior secured obligations of the Company and are guaranteed on a senior secured basis by the Company and certain of the Company’s subsidiaries (collectively, the “Guarantors”) and secured by first -priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all the assets of the Company and the Guarantors. The 6.75% Notes may be redeemed by the Company, at set redemption prices and premiums, plus accrued and unpaid interest, if any. Revolving Credit Facility On February 4, 2022, the Company entered into a senior secured revolving credit facility (the “Revolving Credit Facility”), which provides for an aggregate principal amount of commitments of $ 45.0 million, maturing February 2027, including a letter of credit sub-facility in an aggregate principal amount of up to $ 5.0 million. The obligations under the Revolving Credit Facility are guaranteed by the Company and the Guarantors and are secured by first -priority pari passu liens, subject to permitted liens and certain exceptions, on substantially all the assets of the Company and the Guarantors. Borrowings under the Revolving Credit Facility, if any, will bear interest at a rate per annum equal to, at the Company’s option, an adjusted Secured Overnight Financing Rate rate plus a spread or a base rate plus a spread. The Company is required to pay a 0.5 % quarterly commitment fee on undrawn amounts under the Revolving Credit Facility. As of December 31, 2023, the Company had no borrowings under its Revolving Credit Facility. 9.00% Notes On May 2, 2023, the Company issued $ 275.0 million aggregate principal amount of 9.00 % senior secured notes due 2028 (the “9.00% Notes”) in a private offering. The 9.00% Notes bear interest at a rate of 9.00% per year, and interest is payable semiannually in arrears on May 15 and November 15 of each year. The 9.00% Notes will mature on May 15, 2028, subject to earlier repurchase or redemption. The Company used the net proceeds from the offering to prepay in full all outstanding borrowings under its prior senior secured credit agreements, to pay any related premiums and to terminate in full its prior senior secured credit agreements and the commitments thereunder. The 9.00% Notes are senior unsecured obligations of the Company and are guaranteed (i) on a senior secured basis by certain of the Company’s subsidiaries (collectively, the “Secured Guarantors”) and secured by a first -priority lien, subject to permitted liens and certain exceptions, on the equity and substantially all the assets of the Secured Guarantors, and (ii) on a senior unsecured basis by certain other subsidiaries of the Company. The 9.00% Notes may be redeemed by the Company, at set redemption prices and premiums, plus accrued and unpaid interest, if any. Covenants The 6.75% Notes, 9.00% Notes and Revolving Credit Facility contain covenants that, among other things, restrict the Company’s ability and the ability of its restricted subsidiaries to incur certain additional indebtedness and make certain dividend payments, distributions, investments and other restricted payments. These covenants are subject to a number of important exceptions and qualifications set forth in the 6.75% Notes, 9.00% Notes and Revolving Credit Facility. As of December 31, 2023, the Company was in compliance with the covenants currently in effect. Other The Company’s DuVine subsidiary has a EUR 0.1 million State Assistance Loan related to the financial consequences of the COVID- 19 pandemic, for the purpose of employment preservation. This loan matures August 2025, with monthly payments, and bears an annual interest rate of 0.53 %. F- 20 The Company’s Off the Beaten Path subsidiary’s original $ 0.3 million loan for the purchase of guest transportation vehicles was repaid during June 2023 and its $ 0.8 million loan under the Main Street Expanded Loan Facility, which originated on December 11, 2020, was repaid during May 2023. Long-Term Debt Outstanding As of December 31, 2023 and 2022, long-term debt and other borrowing arrangements consisted of: As of December 31, 2023 2022 (In thousands) Principal Deferred Financing Costs, net Balance Principal Deferred Financing Costs, net Balance 6.75% Notes $ 360,000 $ ( 6,771 ) $ 353,229 $ 360,000 $ ( 8,968 ) $ 351,032 9.00% Notes 275,000 ( 6,481 ) 268,519 - - - Other 77 - 77 955 - 955 First Export Credit Agreement - - - 94,794 ( 1,829 ) 92,965 Second Export Credit Agreement - - - 110,044 ( 2,207 ) 107,837 Total long-term debt 635,077 ( 13,252 ) 621,825 565,793 ( 13,004 ) 552,789 Less current portion ( 47 ) - ( 47 ) ( 23,337 ) - ( 23,337 ) Total long-term debt, non-current $ 635,030 $ ( 13,252 ) $ 621,778 $ 542,456 $ ( 13,004 ) $ 529,452 Future minimum principal payments of long-term debt are as follows: Year Amount (In thousands) 2024 $ 47 2025 30 2026 - 2027 360,000 2028 275,000 Thereafter - $ 635,077 For the years ended December 31, 2023, 2022 and 2021, the Company recorded deferred financing costs of $ 7.5 million, $ 10.9 million and $ 3.0 million, respectively, in long-term debt, amortizing the costs over the term of the financing using the straight-line method. For the years ended December 31, 2023, 2022 and 2021, deferred financing costs charged to interest expense were $ 3.4 million, $ 2.7 million and $ 3.1 million, respectively. During the year ended December 31, 2023, the Company repaid its prior senior secured credit agreements (the “First Export Credit Agreement” and the “Second Export Credit Agreement”), with the proceeds of the 9.00% Notes and $ 3.9 million of deferred financing costs were written-off to other expense. During the year ended December 31, 2022, $ 9.0 million of deferred financing costs related to the repayment of the Company’s prior credit agreement, including the term facility, Main Street Loan and revolving credit facility were written-off to other expense. Letters of Credit As of December 31, 2023 and 2022, the Company had $ 1.2 million in letters of credit outstanding with financial institutions. The annual fee for letters of credit is 1.0 % of the outstanding balance. The letters of credit are secured by a certificate of deposit maintained at the financial institutions and that mature in November 2024. See Note 9—Commitments and Contingencies for more information. F-21 NOTE 7 — FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS In 2018, the Company entered into interest rate cap agreements to hedge its exposure to interest rate movements and to manage its interest expense related to the previous Term Facility and designated these interest rate caps as a cash flow hedge. Changes in the fair value of this interest rate cap were recorded in accumulated other comprehensive income. The cost of the interest rate cap is amortized to interest expense over its life, from the effective date through termination date. The Term Facility was prepaid and terminated in February 2022. The Company recorded the effective portion of changes in the fair value of its cash flow hedges to other comprehensive income (loss), net of tax, and subsequently reclassified these amounts into earnings in the period during which the hedged transaction was recognized. Any changes in fair values of hedges that would be determined to be ineffective would be immediately reclassified from accumulated other comprehensive income (loss) into earnings. No gains or losses of the Company’s cash flow hedges were considered to be ineffective and reclassified from other comprehensive income (loss) to earnings for the years ended December 31, 2022 and 2021. The Company reclassified $ 0.6 million and $ 2.7 million in losses, net of tax, from other comprehensive income (loss) to earnings for the years ended December 31, 2022 and 2021, respectively, due to the maturity of a cash flow hedge and the hedged item. The Company held interest rate cap derivative instruments with absolute notional values of $ 20.3 million as of December 31, 2023. Estimated fair values (Level 2 ) of derivative instruments were as follows: As of December 31, 2023 2022 (In thousands) Fair Value, Asset Derivatives Fair Value, Liability Derivatives Fair Value, Asset Derivatives Fair Value, Liability Derivatives Derivative instruments not designated as cash flow hedging instruments: Interest rate cap (a) $ - $ - $ 683 $ - Foreign exchange forward (b) - 39 - 572 Total $ - $ 39 $ 683 $ 572 __________ (a) Recorded in prepaid expenses and other current assets. This interest rate cap matured in May 2023. (b) Recorded in accounts payable and accrued expenses and prepaid expenses and other current assets, respectively. The effects of derivatives recognized in the Company’s consolidated financial statements were as follows: For the years ended December 31, (In thousands) 2023 2022 2021 Derivative instruments designated as cash flow hedging instruments: Interest rate cap (a) $ - $ - $ ( 363 ) Foreign exchange forward (b) - - ( 605 ) Derivative instruments not designated as cash flow hedging instruments: Interest rate cap (a) $ ( 683 ) 40 - Foreign exchange forward (c) 751 ( 1,236 ) 288 Total $ 68 $ ( 1,196 ) $ ( 680 ) __________ (a) For the year ended December 31, 2022, $ 0.7 million was recognized as income in interest expense, net, and $ 0.6 million was reclassified from other comprehensive (loss) income to interest expense, net. Amounts for the year ended December 31, 2021 were recognized, net of tax, as a component of accumulated other comprehensive (loss) income. (b) For the year ended December 31, 2021, $ 2.7 million was recognized as a loss on foreign currency and $ 2.0 million was recognized, net of tax, as a component of accumulated other comprehensive (loss) income. (c) Gains (losses) related to derivative instruments are expected to be largely offset by (losses) gains on the underlying exposures being hedged and recognized in gain (loss) on foreign currency. F- 22 As of December 31, 2022, the Company had $ 15.0 million of investments in fixed income securities measured at fair value based on quoted market prices. In connection with the acquisition of Classic Journeys during the year ended December 31, 2021, the Company makes recurring fair value measurements of contingent acquisition consideration using level 3 unobservable inputs. As of December 31, 2023, $ 0.6 million was accrued related to this contingent acquisition consideration as it was determined that earnings targets were achieved. Based on the terms of the agreements and comparable market data, the Company estimates the fair value of its long-term debt to be $ 644.5 million as of December 31, 2023. The carrying amounts of cash and cash equivalents, accounts payable and accrued expenses and unearned passenger revenue approximate fair value, due to the short-term nature of these instruments. As of December 31, 2023 and 2022, other than derivative instruments , investments in securities and contingent acquisition consideration, the Company had no other assets or liabilities that were measured at fair value on a recurring basis. NOTE 8 — INCOME TAXES The Company (a “C” Corporation) provides for income taxes based on the Federal and state statutory rates on taxable income. U.S. and foreign components of income before incomes taxes are presented below: For the years ended December 31, (In thousands) 2023 2022 2021 Domestic $ ( 11,630 ) $ ( 21,403 ) $ ( 24,875 ) Foreign ( 26,100 ) ( 80,681 ) ( 96,312 ) Total $ ( 37,730 ) $ ( 102,084 ) $ ( 121,187 ) The income tax provisions are comprised of the following: For the years ended December 31, (In thousands) 2023 2022 2021 Current Federal $ - $ - $ - State 218 244 ( 7 ) Foreign - Other 209 392 45 Total current 427 636 38 Deferred Federal 1,492 5,709 ( 1,894 ) State 625 218 928 Foreign - Other 602 ( 487 ) ( 1,091 ) Total deferred 2,719 5,440 ( 2,057 ) Income tax expense (benefit) $ 3,146 $ 6,076 $ ( 2,019 ) A reconciliation of the U.S. federal statutory income tax (benefit) expense to the Company’s effective income tax provision is as follows: For the years ended December 31, 2023 2022 2021 Tax provision at statutory rate – federal 21.0 % 21.0 % 21.0 % Tax provision at effective state and local rates ( 2.1 %) ( 0.3 %) ( 0.8 %) Foreign tax rate differential ( 17.1 %) ( 16.6 %) ( 15.2 %) Executive compensation ( 5.0 %) 0.0 % 0.0 % Valuation allowance ( 5.9 %) ( 9.4 %) ( 4.1 %) Other 0.8 % ( 0.7 %) 0.8 % Total effective income tax rate ( 8.3 %) ( 6.0 %) 1.7 % F- 23 The Company, through its subsidiaries and affiliated entities in the U.S., the Cayman Islands and Ecuador are subject to US Federal, US state and Ecuadorian Federal income taxes. The Cayman Islands do not impose federal or local income taxes. Deferred tax (liabilities) assets, net, are comprised of the following: As of December 31, (In thousands) 2023 2022 Deferred tax assets: Net operating loss carryforward $ 26,086 $ 27,896 Disallowed interest carryforward 15,286 12,893 Stock-based compensation 383 351 Other 1,637 1,874 Valuation allowance ( 24,726 ) ( 21,521 ) Total net deferred assets 18,666 21,493 Deferred tax liabilities: Property and equipment ( 18,542 ) ( 18,942 ) Other ( 676 ) ( 384 ) Total net deferred liabilities ( 19,218 ) ( 19,326 ) Deferred tax (liabilities) assets $ ( 552 ) $ 2,167 Deferred tax assets and liabilities are recorded on the consolidated balance sheet based on tax jurisdictions. For the years ended December 31, 2023 and 2022, the Company has recorded deferred tax assets of $ 1.6 million and $ 2.2 million, respectively, within other long-term assets, and for the year ended December 31, 2023, a deferred tax liability of $ 2.2 million. The Company recognizes valuation allowances to reduce deferred tax assets to the amount that is more likely than not to be realized. In assessing the likelihood of realization, management considers: (i) future reversals of existing taxable temporary differences; (ii) future taxable income exclusive of reversing temporary differences and carryforwards; (iii) taxable income in prior carryback year(s) if carryback is permitted under applicable tax law; and (iv) tax planning strategies. The Company has deferred tax assets related to U.S. federal loss carryforwards of $ 98.8 million as of December 31, 2023, which begin to expire in 2036. The timing and manner in which the Company will utilize the net operating loss carryforwards in any year, or in total, may be limited in the future as a result of changes in the Company’s ownership and any limitations imposed by the jurisdictions in which the Company operates. As a result of the transition to the territorial tax regime effectuated by the Tax Cuts and Jobs Act enacted in 2017, any potential dividends from the Company’s foreign subsidiaries would no longer be subject to Federal tax in the United States. The Company continue to assert its prior position regarding the repatriation of historical foreign earnings from its Ecuadorian subsidiaries. The Company currently has no intention to remit any additional undistributed earnings of its Ecuadorian subsidiaries in a taxable manner. The Company no longer remains permanently reinvested in the earnings of its Cayman subsidiary. No taxes have been accrued as a result of this change because no taxes are expected to be imposed by either the United States or the Cayman Islands upon such a remittance. The Company is subject to income taxes in the U.S. and various state and foreign jurisdictions. The Company establishes liabilities for tax-related uncertainties based on estimates of whether, and the extent to which, additional taxes may be due. These liabilities are established when the Company believes that certain positions might be challenged despite its belief that its tax return positions are fully supportable. The Company adjusts these liabilities in light of changing facts and circumstances, such as the outcome of a tax audit. The provision for income taxes includes the impact of changes to these liabilities. As of December 31, 2023 and 2021, the Company had no unrecognized tax positions. As of December 31, 2022, the Company had $ 1.4 million of unrecognized tax benefits. The Company has elected an accounting policy to classify interest and penalties related to unrecognized tax benefits as a component of income tax expense. For the years ended December 31, 2023, 2022 and 2021, interest and penalties included in income tax expense related to unrecognized tax benefits and/or uncertain tax positions were insignificant. F- 24 The Company is subject to tax audits in all jurisdictions for which it files tax returns. Tax audits by their very nature are often complex and can require several years to complete. Currently, there are no U.S. federal, state or foreign jurisdiction tax audits pending. The Company’s corporate U.S. federal and state tax returns for the current year and the four prior years remain subject to examination by tax authorities and the Company’s foreign tax returns for the current year and the five prior years remain subject to examination by tax authorities. NOTE 9 — COMMITMENTS AND CONTINGENCIES Redeemable Non-Controlling Interest Contingent Arrangements The Company has controlling interests in its Natural Habitat, Off the Beaten Path, DuVine and Classic Journeys consolidated subsidiaries. The noncontrolling interests are subject to put/call agreements. The agreements were established to provide formal exit opportunities for the minority interest holders and a path to 100% ownership for the Company. The put options, under certain conditions, enable the minority holders, but do not obligate them, to sell the remaining interests to the Company. The Company has call options which enable it, but does not obligate it, to acquire the remaining interests in the subsidiaries, subject to certain dates, expirations and similar redemption value purchase measurements as the put options. Mr. Bressler, founder of Natural Habitat, retains a 19.9 % noncontrolling interest in Natural Habitat, which is subject to a put/call arrangement, amended May 2020 and December 2022. Mr. Bressler has a first put option that under certain conditions, and subject to providing notice within 30 days of being provided with valuation, that enables him, but does not obligate him, to sell up to 50% of his remaining interest in Natural Habitat to the Company, valued as of December 31, 2023, and a second put option that under certain conditions, and subject to providing notice by January 31, 2026, that enables him, but does not obligate him, to sell his remaining interest in Natural Habitat to the Company, valued as of December 31, 2025. The Company has a call option, but not an obligation, with an expiration of March 31, 2029, under which it can buy Mr. Bressler’s remaining interest at a similar fair value measure as Mr. Bressler’s put option, subject to a call purchase price minimum. Mr. Lawrence, President of Off the Beaten Path, through a combination of his original minority interest and the profit interest units he received, retains a 19.9 % noncontrolling interest in Off the Beaten Path, which is subject to a put/call arrangement. Mr. Lawrence has a put option, that under certain conditions and subject to providing notice by October 31, 2025, that enables him, but does not obligate him, to sell his remaining interest in Off the Beaten Path to the Company, valued as of December 31, 2025. The Company has a call option, but not an obligation, on or after October 31, 2025, with an expiration of December 31, 2030, under which it can buy Mr. Lawrence’s remaining interest at a similar fair value measure as Mr. Lawrence’s put option. Mr. Levine, founder of DuVine, retains a 30 % noncontrolling interest in DuVine, which is subject to a put/call arrangement. Mr. Levine has a put option, that under certain conditions and subject to providing notice by January 31, 2026, that enables him, but does not obligate him, to sell his remaining interest in DuVine to the Company, valued as of December 31, 2025. The Company has a first call option, expiring December 31, 2025, to acquire an additional 10 % of DuVine from Mr. Levine, and a second call option, but not an obligation, on or after December 31, 2025, with an expiration of December 31, 2030, under which it can buy Mr. Levine’s remaining interest at a similar fair value measure as Mr. Levine’s put option, subject to a call purchase price minimum. Mr. and Mrs. Piegza, founders of Classic Journeys, retain a 19.9 % noncontrolling interest in Classic Journeys, which is subject to a put/call arrangement. Mr. and Mrs. Piegza have a put option that under certain conditions, and subject to providing notice by November 13, 2026, that enables them, but does not obligate them, to sell their remaining interest in Classic Journeys to the Company, valued as of the fiscal quarter prior to the put notice. The Company has a call option, but not an obligation, under which it can buy Mr. and Mrs. Piegza’s remaining interest at a similar fair value measure as Mr. and Mrs. Piegza’s put option. Since the redemption of these noncontrolling interests is not solely in the Company’s control, the Company is required to record the redeemable noncontrolling interest outside of stockholders’ equity but after its total liabilities. In addition, if it is probable that the instrument will become redeemable, as such solely due to the passage of time, the redeemable noncontrollable interest should be adjusted to the redemption value via one of two measurement methods. The Company elected the income classification-excess adjustment and accretion method for recognizing changes in the redemption value of the put options. Under this methodology, a calculation of the present value of the redemption value is compared to the carrying value of the redeemable noncontrolling interest and the carrying value of the redeemable noncontrolling interest is adjusted to the redemption value’s present value. Any adjustments to the carrying value of the redeemable noncontrolling interest, up to the fair value of the of the noncontrolling interest, are classified to retained earnings. Adjustments in excess of the fair value of the noncontrolling interest, are treated as a decrease to net income available to common stockholders. The fair value of the put options was determined using a discounted cash flow model. The redemption values were adjusted to their present values using the Company’s weighted average cost of capital. F- 25 The following is a rollforward of the redeemable noncontrolling interest: For the years ended December 31, (In thousands) 2023 2022 2021 Beginning balance $ 27,886 $ 10,626 $ 7,494 Net income attributable to noncontrolling interest 4,734 3,221 38 Redemption value adjustment of put option 5,695 14,039 202 Distribution ( 531 ) - - Acquired businesses᾽ noncontrolling interest - - 2,892 Ending balance $ 37,784 $ 27,886 $ 10,626 Lease Commitments The Company leases office space and equipment under long-term leases, which are classified as operating leases. As of December 31, 2023, the Company’s remaining weighted average operating lease terms were approximately 31 months. A reconciliation of operating lease payments undiscounted cash flows to lease liabilities recognized as of December 31, 2023 is as follows: (In thousands) Operating Lease Payments 2024 $ 1,923 2025 1,193 2026 496 2027 393 Present value discount ( 6 % weighted average) ( 231 ) Total $ 3,774 Lease expense was $ 2.7 million, $ 2.3 million and $ 2.0 million for the years ended December 31, 2023, 2022 and 2021, respectively. These amounts are recorded within general and administrative expenses. Royalty Agreement – National Geographic The Company is engaged in a brand license agreement with National Geographic through 2040, which allows the Company to use the National Geographic name and logo, as well as other rights. In return for these rights, the Company is charged a royalty fee. The royalty fee is included within selling and marketing expense. The amount is calculated based upon a percentage of certain ticket revenues less travel agent commission, including the revenues received from cancellation fees and any revenues received from the sale of voyage extensions. A voyage extension occurs when a guest extends his or her trip with pre- or post-voyage hotel nights and is included within tour revenues. The royalty expense is recognized at the time of revenue recognition. This royalty expense for the years ended December 31, 2023, 2022 and 2021 was $ 7.6 million, $ 5.7 million and $ 1.7 million, respectively. Royalty Agreement – World Wildlife Fund Natural Habitat has a license agreement with World Wildlife Fund, which allows it to use the WWF name and logo. In return for these rights, Natural Habitat is charged a royalty fee and a fee based on annual gross sales. The fees are included within selling and marketing expense. The annual royalty payment and gross sales fees are paid on a quarterly basis. For the years ended December 31, 2023, 2022 and 2021, these fees totaled $ 1.2 million, $ 1.1 million and $ 0.6 million, respectively. Charter Commitments From time to time, the Company enters into agreements to charter vessels onto which it holds its tours and expeditions, and with third parties to provide chartered air service for guests and crew on certain of its expeditions. Future minimum payments on its charter agreements are as follows: For the years ended December 31, Amount (In thousands) 2024 $ 15,767 2025 12,647 Total $ 28,414 F- 26 Other Commitments The Company participates, with other tour operators, in the Consumer Protection Insurance Plan sponsored by the United States Tour Operators Association (“USTOA”). The USTOA requires a $1.0 million performance bond, letter of credit or assigned certificate of deposit from its members to insure this plan. The Company has assigned a $ 1.0 million letter of credit to the USTOA to satisfy this requirement. This letter of credit will be used only if the Company becomes insolvent and cannot refund its customers’ deposits. Legal Proceedings The Company is involved in various claims, legal actions and regulatory proceedings arising from time to time in the ordinary course of business. In the opinion of management, after consulting legal counsel, there are no outstanding proceedings that are expected to have a material adverse effect on the Company’s financial position, results of operations or cash flows. NOTE 10 — EMPLOYEE BENEFIT PLAN The Company has a 401 (k)-profit sharing plan and trust for its employees. The Company matched 30 % in 2023, 2022 and 2021, respectively, of employee contributions up to a per employee annual maximum of $ 2,400 for 2023, 2022 and 2021. The Company’s benefit plan contributions amounted to $ 0.7 million, $ 0.6 million and $ 0.4 million for the years ended December 31, 2023, 2022 and 2021, respectively. The benefit plan contributions are recorded within general and administrative expenses. NOTE 11 — STOCKHOLDERS ’ EQUITY Company Stock The Company has 1,000,000 shares of preferred stock authorized, $ 0.0001 par value and 200,000,000 shares of common stock authorized, $ 0.0001 par value. Preferred Stock On August 31, 2020, the Company issued and sold 85,000 shares of Series A Redeemable Convertible Preferred Stock, par value of $ 0.0001 , (“Preferred Stock”) for $ 1,000 per share for gross proceeds of $ 85.0 million. As of December 31, 2023, 62,000 shares of Preferred Stock are outstanding. The Preferred Stock has senior and preferential ranking to the Company’s common stock. The Preferred Stock is entitled to cumulative dividends of 6.00 % per annum, and for the first two years, the dividends were to be paid-in-kind, and through December 31, 2023, the Company has continued to pay dividends in-kind. After the second anniversary of the issuance date, the dividends may be paid-in-kind or be paid in cash at the Company’s option. The Preferred Stock is convertible at any time, at the holder’s election, into a number of shares of common stock of the Company equal to the quotient obtained by dividing the then-current accrued value by the conversion price of $ 9.50 . The Company may, at its option, convert all, but not less than all, of the Preferred Stock into common stock if the closing price of shares of common stock is at least 150% of the conversion price for 20 out of 30 consecutive trading days. The number of shares of common stock received in such conversion shall be equal to the quotient obtained by dividing the then-current accrued value by the conversion price. At the six -year anniversary of the closing date, each investor has the right to require the Company to repurchase their Preferred Stock and any Preferred Stock not requested to be repurchased shall be converted into common shares of the Company equal to the quotient obtained by dividing the then-current accrued value by the conversion price. The Preferred Stock deferred issuance costs was $ 2.1 million as of December 31, 2023. During the years ended December 31, 2022 and 2021, 18,000 and 5,000 shares, respectively, of Preferred Stock and related accumulated dividends were converted by the holders into 2,109,561 and 566,364 shares, respectively, of the Company’s common stock. No shares of Preferred Stock were converted into shares during 2023. For the years ended December 31, 2023, 2022 and 2021, the Company recorded $ 4.4 million, $ 4.6 million and $ 5.3 million, respectively, in accrued dividends for Preferred Stock. As of December 31, 2023, the Preferred Stock could be converted at the option of the holders into 8.0 million shares of the Company’s common stock. F-27 Stock Repurchase Plan In 2016, the Company’s Board of Directors approved a $15.0 million increase to the Company’s existing stock and warrant repurchase plan (“Repurchase Plan”), to $35.0 million. This Repurchase Plan authorizes the Company to purchase from time to time the Company’s outstanding common stock and previously outstanding warrants. Any shares purchased are retired. The Repurchase Plan has no time deadline and will continue until otherwise modified or terminated at the sole discretion of the Company’s Board of Directors. The repurchases exclude shares repurchased to settle statutory employee tax withholding related to the vesting of stock awards. Since the Repurchase Plan inception, the Company has cumulatively repurchased 875,218 shares of common stock for $8.3 million and 6,011,926 warrants for $14.7 million, as of December 31, 2023. All repurchases were made using cash resources. The balance available for the Repurchase Plan as of December 31, 2023 was $12.0 million. NOTE 12  — STOCK-BASED COMPENSATION During 2021, the Company’s compensation committee approved the 2021 Long-Term Incentive Plan, which supersedes the 2015 Long-Term Incentive Plan, and authorizes restricted time and performance awards and stock options to key employees. The Company's stock-based compensation program is a long-term retention program that provides for the grant of options, restricted stock, restricted stock units (“RSUs”), performance-based restricted stock or units (“PSUs”) and/or market stock units (“MSUs”) to attract, retain and provide incentives for directors, officers and employees. The maximum number of shares reserved for the grant of awards under the plan is 4.7 million, with approximately 3.7 million shares available as of December 31, 2023. The Company settles stock-based awards with newly issued shares. Restricted Stock and Restricted Stock Units Restricted stock is shares of stock granted to an employee, non-employee director or other service providers for which sale is prohibited for a specified period of time. Restricted stock typically vests ratably over a one or three -year period following the date of grant. RSUs represent a promise to deliver shares to the employee, non-employee director or other service providers at a future date if certain vesting conditions are met. RSUs typically vest ratably over a three -year period following the date of grant. The Company does not deliver the shares associated with the RSUs to the employee, non-employee director or other service providers until the vesting conditions are met. The number of shares or units granted are determined based upon the closing price of the Company's common stock on the date of the award. Market Stock Units MSUs represent a promise to deliver shares to the employee, non-employee director or other service providers at a future date if certain performance and vesting conditions are met. The MSUs are market-based equity incentive awards based on a performance-multiplier of change in the stock price of the Company’s common stock between the grant date and a determined closing price. Each MSU represents the right to receive one share of Company stock multiplied by a performance multiplier or, at the option of the Company, an amount of cash. The number of shares that will eventually be earned and vest may be more or less than the number of MSUs that are awarded, depending on the Company's common stock price. Awards, if earned, will vest after a determined performance period and may be earned at a level ranging from 0 %- 150 % of the number of MSUs granted, depending on performance. The number of units granted were determined based upon the closing price of the Company's common stock on the date of the award. The Company assessed the applicable metrics related to the MSU grants, estimating the fair value of employee MSU awards and the amount of stock compensation expense using the Monte-Carlo pricing model. Performance Stock Units PSUs represent a promise to deliver shares to the employee, non-employee director or other service providers at a future date if certain performance and vesting conditions are met. PSUs generally vest three years following the date of grant based on the attainment of performance- or market-based goals, all of which are subject to a service condition. The Company does not deliver the shares associated with the PSUs to the employee, non-employee director or other service providers until the performance and vesting conditions are met. F- 28 The PSUs granted may be earned based on the Company's performance against metrics relating to annual Adjusted EBITDA and annual revenue. Awards, if earned, will vest after a three -year performance period and may be earned at a level ranging from 0 %- 200 % of the number of PSUs granted, depending on performance. The number of units were determined based upon the closing price of the Company's common stock on the date of the award. The Company assessed the applicable metrics related to the PSU grants, determined the blended probability of achieving the performance metrics and valued the awards based on the fair value at the date of grant with the amount of stock compensation expense determined based on the number of PSU’s expected to vest. Long-Term Incentive Compensation See the following table for a summary of PSU, restricted stock, RSU and MSU activity. Performance-based Stock Units Restricted Stock and Restricted Stock Units Market-based Stock Units Number of Shares Weighted Average Grant Date Fair Value Number of Shares Weighted Average Grant Date Fair Value Number of Shares Weighted Average Grant Date Fair Value Balance, December 31, 2022 22,620 5.41 540,723 14.17 131,976 13.66 Granted 96,757 9.56 573,668 9.70 25,517 9.56 Vested and released - - ( 256,255 ) 12.25 ( 76,547 ) 8.51 Forfeited ( 52,693 ) 7.78 ( 200,929 ) 14.02 ( 19,065 ) 15.08 Balance, December 31, 2023 66,684 9.56 657,207 11.06 61,881 17.48 Stock Options Stock options represent a right to buy a number of shares by the employee, non-employee director or other service providers at a future date, for a pre-set price, or exercise price, for a fixed period of time. Stock options generally vest over one to four years, with a term of ten years. Stock compensation expense related to options are recorded based on the fair value of stock option grants, amortized on a straight-line basis over the employee’s required service period. The Company estimated the fair value of employee stock options using the Black-Scholes option pricing model. The Company uses the simplified method for determining an option term under Black-Sholes as the Company issues options infrequently. The fair values of employee stock options granted under the 2021 and 2015 plans were estimated using the following assumptions: Stock Option Grants 2023 2022 2021 Stock price $ 9.56 $ 12.64 - 14.36 $ 16.38 Exercise price $ 9.56 $ 12.64 - 14.36 $ 16.38 Dividend yield 0.0 % 0.00 % 0.00 % Expected volatility 64.6 % 57.79 % 25.61 % Risk-free interest rate 3.63 % 2.75 - 3.15 % 1.63 % Expected term in years 6.25 6.25 7.50 The following table is a summary of stock option activity: Number of Options Weighted Average Exercise Price Weighted Average Contractual Live (Years) Aggregate Intrinsic Value Options outstanding as of December 31, 2022 1,388,458 15.10 7.9 - Granted 500,000 9.56 Forfeited ( 1,000,000 ) 16.38 Options outstanding as of December 31, 2023 888,458 10.55 7.7 - F- 29 As of December 31, 2023 Number of Options Weighted Average Exercise Price Weighted Average Contractual Live (Years) Aggregate Intrinsic Value Options vested and/or expected to vest 888,458 $ 10.55 7.7 $ - Options exercisable 238,115 10.43 3.9 - During the year ended 2022, 77,500 options with an intrinsic value of $ 0.3 million were exercised, and during the year ended December 31, 2021, 12,000 options with an intrinsic value of $ 0.1 million were exercised. No options were exercised during the year ended December 31, 2023. Stock-based Compensation Expense Stock-based compensation expense for the years ended December 31, 2023, 2022 and 2021 was $ 13.9 million, $ 7.0 million and $ 5.6 million, respectively, and is included in general and administrative expenses. The total income tax benefit recognized for stock-based compensation plans for the years ended December 31, 2023, 2022 and 2021 was $ 0.0 million. As of December 31, 2023, unrecognized stock-based compensation expense was $ 16.6 million. This amount is expected to be recognized over a weighted average period of approximately 2.1 years. Mr. Bressler has an equity incentive opportunity to earn an award of options based on the financial performance of Natural Habitat, where if the final year equity value of Natural Habitat, as defined in Mr. Bressler's employment agreement, as amended, exceeds $ 25.0 million, effective as of December 31, 2025, Mr. Bressler will be granted options with a fair value equal to 10.1 % of such excess, subject to certain conditions. Mr. Bressler has a one -time right to elect an early option award of 50% valued as of December 31, 2023, by providing notice within 30 days of being provided with the final value calculation. The actual number of options granted will be determined by the calculated final year equity value of Natural Habitat and the Black-Scholes per share option value, factoring in the Company’s stock price on the date of the grant, its volatility and a discount rate. During the year ended December 31, 2023, the Company determined it was probable the performance condition would be met and therefore, recorded $ 8.0 million of stock-based compensation expense. In 2021, Mr. Lawrence, President of Off the Beaten Path, was issued 1,007 profit interest units in the equity of Off the Beaten Path as part of the 2021 acquisition. The profit interest units had a grant date fair value of $ 132.86 per share and are considered vested upon issuance. NOTE 13 — SEGMENT INFORMATION The Company’s chief operating decision maker, or CODM, assesses performance and allocates resources based upon the separate financial information from the Company’s operating segments. In identifying its reportable segments, the Company considered the nature of services provided, the geographical areas in which the segments operated and other relevant factors. The Company is primarily an experiential travel operator with operations in two segments, Lindblad and Land Experiences. While both segments have similar characteristics, the two operating and reporting segments cannot be aggregated because they fail to meet the requirements for aggregation. The Company evaluates the performance of the business based largely on the results of its operating segments. The CODM and management review operating results monthly, and base operating decisions on the total results at a consolidated level, as well as at a segment level. The reports provided to the Board of Directors are at a consolidated level and also contain information regarding the separate results of both reportable segments. The Company evaluates the performance of its business segments based largely on tour revenues and operating income, without allocating other income and expenses, net, income taxes and interest expense, net. For the years ended December 31, 2023, 2022 and 2021, reportable segment operating results were as follows: F- 30 For the years ended December 31, 2023 2022 2021 (In thousands) Tour revenues: Lindblad $ 397,410 $ 278,449 $ 82,842 Land Experiences 172,133 143,051 64,265 Total tour revenues $ 569,543 $ 421,500 $ 147,107 Operating income (loss): Lindblad $ ( 8,692 ) $ ( 77,871 ) $ ( 111,477 ) Land Experiences 19,291 14,825 646 Total operating income (loss) $ 10,599 $ ( 63,046 ) $ ( 110,831 ) Intercompany tour revenues between the Lindblad and Land Experiences segments eliminated in consolidation and in the presentation above for the years ended December 31, 2023, 2022 and 2021 were $ 7.9 million, $ 6.0 million and $ 2.2 million, respectively. Depreciation and amortization expense is included in segment operating income as shown below: For the years ended December 31, 2023 2022 2021 (In thousands) Depreciation and amortization: Lindblad $ 43,351 $ 41,275 $ 37,516 Land Experiences 3,360 2,767 2,009 Total depreciation and amortization $ 46,711 $ 44,042 $ 39,525 The following table presents the Company’s total assets, intangibles, net and goodwill by segment: As of December 31, 2023 2022 Total Assets: Lindblad $ 675,432 $ 662,683 Land Experiences 155,865 125,292 Total assets $ 831,297 $ 787,975 Intangibles, net: Lindblad $ 1,592 $ 1,680 Land Experiences 7,820 9,539 Total intangibles, net $ 9,412 $ 11,219 Goodwill: Lindblad $ - $ - Land Experiences 42,017 42,017 Total goodwill $ 42,017 $ 42,017 F-31