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Articles from 2020 In March


New RCL Cares program informs travel advisors about recovery resources

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CARES Act and other government benefits

RCL Cares will offer a variety of services to help educate travel partners as they navigate the myriad of government benefits, including those in the newly signed US economic relief measure, the CARES Act.

One-on-one assistance

These services will include one-on-one assistance and access to key resources and the latest information pertaining to recovery benefits available under the act. Travel partners can find educational material about the new law beginning today, and they will soon have the opportunity to receive more assistance through a resource desk the company is setting up. The program will not provide legal advice.

'Our travel partner community is hurting, and help can’t come too soon,' said RCL Chairman and CEO Richard Fain said. 'Any piece of legislation can be challenging to understand, and we want our travel advisors to receive all the financial assistance available to them. While our ships are idle, we have resources that can be redirected to helping our travel partners so that they will be fully ready and able to charge ahead when we return to service.'

Sales teams will guide travel advisors

Behind RCL Cares’ personalized services are sales teams from Azamara, Celebrity Cruises, Royal Caribbean International and Silversea, who will guide travel advisors through the information about the CARES Act as they consider their options for economic relief.

Travel professionals can get started with RCL Cares at CruisingPower.com, where they can access highlights of the CARES Act, FAQs, Small Business Association resources and tips. The support program will introduce new services and tools in the near future to continue helping travel partners during this difficult time.

US Coast Guard warns passenger ships about medevacs

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USCG outlned a new procedure for requesting medevacs of individuals with influenza-like symptoms

USCG's Seventh District commander has directed ships carrying more than 50 people to be prepared to care for individuals with influenza-like illnesses on board for an 'indefinite period of time.'

Based in Miami, the Seventh District covers Florida, Puerto Rico, Georgia and South Carolina.

According to a March 29 Marine Safety Information Bulletin, medevacs from foreign passenger vessels, of both stable and critically ill people with influenza-like illnesses, including COVID-19, have increased.

Miami no longer accepting medevac patients

And strains on local medical resources throughout the Seventh District are expected to increase, Rear Adm. E.C. Jones, district commander, said in the bulletin. For example, medical facilities at Miami are no longer accepting medevac patients due to limited hospital capacity and it is expected neighboring counties will follow suit.

'It must be considered a potential evacuee has better access to comfortable surroundings and medical staff on board the foreign passenger vessel where care is already being provided,' Jones continued. 'To ensure the safety of persons on board and mitigate the potential of overwhelming local medical services, all vessels operating within the Seventh District AOR with more than 50 persons on board should increase their medical capabilities, personnel and equipment in order to care for individuals with [influenza-like illnesses] for an indefinite period of time. This is necessary as shoreside medical facilities may reach full capacity and lose the ability to accept and treat additional critically ill patients.'

New procedure

Vessels requesting medevacs of people with influenza-like illnesses were directed to communicate with the Joint Rescue Coordination Center Miami or San Juan to consult with a Coast Guard flight surgeon who will determine the medical needs. Only then, with concurrence of a search and rescue coordinator and confirmed availability of a hospital facility, will a medevac be considered.

Bahamas-registered ships

'Foreign-flag vessels that loiter beyond US territorial seas, particularly those registered to the Bahamas, that require a medevac to a shoreside facility should seek flag-state support prior to seeking support from the limited facilities in the US,' the bulletin said.

Cruise ships stuck at sea a humanitarian crisis: Orlando Ashford

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Orlando Ashford is pictured with pursers during a past Holland America ship visit

HAL is working to find medical help and safe passage home for the 1,243 passengers and 1,247 crew stranded at sea on Zaandam and Rotterdam.

They are among the 9,000-plus passengers still remaining on about a dozen other cruise ships worldwide.

'Unfortunate souls unwittingly caught up'

'These are unfortunate souls unwittingly caught up in the fast-changing health, policy and border restrictions that have rapidly swept the globe,' Ashford said in an opinion piece published in the South Florida Sun-Sentinel and as a HAL blog post

He's concerned with how those needing intensive medical treatment will receive it with limited shipboard medical staff, facilities and supplies. As well, nations are reluctant to share provisions or afraid to carry critical supplies to the ships. 'What happens when our supplies run out?' Ashford said. 'Can guests and crew without symptoms get home with limited flights and closed borders?

'Even our guests are questioning, “My president or prime minister told me to get home. I’m a citizen. How can my government turn me away?”'

Ashford acknowledged nations are 'justifiably focused on the COVID-19 crisis unfolding before them. But they’ve turned their backs on thousands of people left floating at sea. Are these reactions based on facts from experts like the US Centers for Disease Control and Prevention, or fueled by irrational fear? What happened to compassion and help thy neighbor?' he added.

Four deaths

Aboard Zaandam, four people have died, and Ashford fears others may be at risk. As of Monday, 76 passengers and 117 crew reported influenza-like illness, including eight people tested positive for COVID-19. 'We have seen a notable and steady decline in cases of the last 48 hours, which shows the immediate actions we took have helped contain spread,' Ashford added.

He expressed appreciation to the Panamanian government for allowing Zaandam and Rotterdam to move through the Panama Canal, on humanitarian grounds. 

The ships still face a multi-day journey before they can dock and disembark. 'And we need confirmation from a port that is willing to extend the same compassion and grace that Panama did, and allow us to come in so our guests can go straight to the airport for flights home,' the HAL chief said.

'COVID-19 response a test of our humanity'

'It’s easy to condemn those who are unhelpful and unwelcoming during times of need. But what if instead we focus on the type of society we strive to be, where nations share a collective responsibility to help others in peril? Because these travelers could have been any one of us or our families — caught up by a fast-changing scenario nobody foresaw,' Ashford continued.

'The COVID-19 situation is one of the most urgent tests of our common humanity. To slam the door in the face of these people betrays our deepest human values.

Given the opportunity, I am hopeful that all of us will follow the lead of our Panamanian friends and help our neighbors.'

March 31 updates: Princess fleet status, repatriating crew, Harris Poll gloom, RCL extends flexible policy, more lines delay, ships laid up in NZ

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Disney Cruise Line delayed its return to service through April 28. Pictured here: Disney Fantasy

Keep checking back. This is being continuously updated.

CF Sharp working to get 1,000 crew home

CF Sharp Crew Management said it is doing all it can to repatriate crew from ships around the globe and has suspended crew deployments until further notice.

The Philippines-headquartered crew specialist has 100 crew members recently returned from cruise vessels who are undergoing 14 days of isolation Manila before they may reunite with their families, while a further 899 seafarers are due to arrive this week.

Roger Storey, managing director, CFSharp, Singapore, praised cruise line clients for their support getting seafarers home. He said Norwegian Cruise Line arranged two sweeper flights which, as long as they are not held up byred tape, are due to arrive in Manila on April 1 (445 seafarers) and April 2 (454 seafarers). Places have been reserved for all of them to undertake their compulsory 14-day quarantine.

Storey said his firm is working to help seaferers obtain financial aid from the Philippine government’s Support for Seafarers scheme, administered by the Overseas Workers Welfare Administration.

Harris Poll's gloomy cruise projection

According to a Harris Poll, the cruise industry will take longer to recover than other travel options like flying on a plane or staying at a hotel. The firm looked at how long it would take people to resume a host of normal activities and travel options after the COVID-19 curve flattens. 

'Americans are keeping their distance from cruise ships for the time being,' the poll found, with 22% of those polled saying it will take a year or longer before they'd take a cruise and one in 10 saying 'never again.' 

The polling took place over the March 21-23 weekend and involved a nationally representative sample of 2,023 US adults. 

John Gerzema, CEO of the Harris Poll, told Forbes it's important to remember this is a snapshot taken at a very dark time. 'At the moment, getting on a plane or a cruise ship looks like high-stakes gambles,' he said. So this type of near-term pessimistic outlook would be expected.

Royal Caribbean group extends 'Cruise With Confidence'

The Royal Caribbean group —Royal Caribbean International, Celebrity Cruises, Azamara and Silversea — extended its 'Cruise With Confidence' cancellation policy through Sept. 1. This allows cancellations up to 48 hours prior to sailing for any reason. Passengers will receive a full credit for their fare, usable on any future sailing of choice in 2020 or 2021.

The extension applies to new and existing cruise bookings.

Disney delays

Disney Cruise Line extended the suspension of new departures through April 28. Impacted passengers will be offered a cruise credit to be used within 15 months of their original sail date or a full refund.

Australian ships, too

P&O Cruises Australia further extended its voluntary pause to operations across Australia and New Zealand. The company had earlier extended its deadline until May 15, but that has now been put back until June 15.

Carnival Cruise Line Australia and Princess Cruises have also decided to resume operations on June 15.

Ships laid up in NZ

A report from the New Zealand Cruise Association said cruise ship agents have been liaising with government agencies to permit some ships to remain in New Zealand.

There are currently two ships in Auckland — Hapag-Lloyd’s Bremen, docked at Queens Wharf, and Ponant’s Le Láperouse, at anchor.

Arrangements are being made for these ships to continue to lay up in New Zealand without passengers and with crew numbers consistent with international manning requirements.

Princess Cruises' fleet status

Only two of the 18 ships in Princess Cruises' fleet are still sailing. Coral Princess was to make a service call at Barbados Tuesday evening before continuing to Port Everglades with arrival estimated April 4. A 'higher-than-normal' number of people have reported influenza-like symptoms, with many testing positive for regular influenza. However, all passengers have been asked to stay in their rooms and meals are being delivered. Crew are remaining in their cabins when off duty. 

Pacific Princess is at sea, having loaded provisions and refueled in Melbourne, Australia, on Friday. Aboard are 115 passengers who did not meet the International Air Transport Association fitness standards for air travel or were unable to return home by aircraft due to medical conditions unrelated to COVID-19. They are sailing back to Los Angeles, for arrival approximately April 17, with an additional service call before then at Honolulu.

The other ships are paused: Caribbean, Crown, Emerald, Island, Regal, Sky Princess (at or off Port Everglades); Diamond Princess (Yokohama); Golden Princess (Melbourne); Grand Princess (San Francisco); Majestic Princess (Fremantle); Royal and Star Princess (Los Angeles); Ruby, Sea, Sun Princess (Sydney); Sapphire Princess (Singapore).

Carnival Corp. & plc commences public stock and private notes offerings

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For the stock offering, the corporation intends to grant the underwriters an option to purchase up to $187.5m of additional shares. The net proceeds will be used for general corporate purposes.

BofA Securities, Goldman Sachs & Co. LLC and JPMorgan are acting as joint book-running managers.

Dividend payments suspended

The company also said it would suspend dividend. This would equate to about $1.1bn for the remainder of the year, according to a note from brokerage William Blair. 

Senior convertible notes offerings

In tandem, Carnival commenced private offerings to eligible purchasers of $3bn aggregate principal amount of first-priority senior secured notes due 2023 and $1.75bn aggregate principal amount of senior convertible notes due 2023 (or up to $2.0125bn aggregate principal amount if the initial purchasers exercise in full their option to purchase additional convertible notes).

The corporation intends to grant the initial purchasers of the convertible notes an option to purchase, during a 13-day period beginning when the convertible notes are issued, up to an additional $262.5m aggregate principal amount of convertible notes.

The proceeds will be used for general corporate purposes.

Guarantees

Each series of notes will be guaranteed by Carnival plc and certain subsidiaries that own or operate the company's vessels and material intellectual property. Additionally, the secured notes and the related guarantees will be secured by a first-priority lien on the collateral, which includes pledges on the capital stock of each subsidiary guarantor, mortgages on a substantial majority of the vessels and related vessel collateral, material intellectual property and pledges over other vessel-related assets including inventory, computer software and casino equipment.

The notes will be convertible at the holder's option in certain circumstances. Upon conversion, the corporation intends to satisfy its conversion obligation by paying or delivering, at its election, cash, shares of its common stock or a combination of those.

Additional $6.45bn in liquidity

Reflecting the additional $6.45bn in liquidity from the notes and share offerings — assuming underwriters fully exercise their options— combined with the roughly $1.1bn in suspended dividends, Carnival’s liquidity position has increased to roughly $19.3bn, up from $11.7bn at the end of the first quarter, according to a note by William Blair analyst Sharon Zackfia.

As a result, Carnival management believes it has adequate liquidity through the end of fiscal 2020, she said.

Some CCL debt traded at 8% yield last week

In a note, Wells Fargo Securities anticipated lenders will waive any near-term financing related covenant violations from the additional debt. According to analyst Tim Conder, some of Carnival's debt traded with an 8% yield last week.

The brokerage believes CCL has now exhausted the majority of its asset base available to pledge as security through this offering and adding security to two existing facilities of approximately $400m, including Carnival plc's 7.875% notes due June 1, 2027.

Wells Fargo favors equity raises

'We would have liked to see a larger mix of CCL's capital raise skewed to equity as this would have kept some remaining “dry powder” in the form of debt, should additional needs arise,' Conder said. 'We hope RCL and NCLH consider “proactive” equity raises,' he added.

 

Sture Myrmell seeks repatriation for Ruby Princess crew

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Sture Myrmell is asking federal and NSW governments to allow the repatriation of Ruby Princess crew members

Ruby Princess docked in Sydney on March 19 and has been linked to around 200 coronavirus infections that were carried ashore by disembarking passengers.

Myrmell is pleading for crew members on ‘compassionate and humanitarian’ grounds.

Australia’s international standing

‘Being able to send home those crew members who are not required for the safe operation of the ship is the right thing to do, both from a humanitarian point of view and Australia’s international  standing as a maritime nation that looks after foreign nationals in its care,’ he said.

Not safe to sail away

He said it is not safe for the ship to sail away from Australia while there are crew members on board who are ill.

‘While illness on board has been reduced due to strong health management, the ship needs to remain within reach of Australia to access healthcare services if an urgent need arises,’ he said.

Maritime obligations

‘Australia has maritime obligations to protect the welfare of seafarers and as such we need to care for foreign nationals as we would expect other nations to care for Australians in similar circumstances abroad.’

Myrmell said the repatriation of Ruby Princess’ crew would be ‘an important step in upholding Australia’s reputation as a caring maritime nation.’

Viking to debut large, modern Mississippi vessel in August 2022

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Viking Mississippi — five decks high with 193 all-outside staterooms and alfresco dining options

Full length of the Mississippi

Viking Mississippi will sail voyages on the Lower and Upper Mississippi, between New Orleans and St. Paul. Currently scheduled ports span seven states: Louisiana (Baton Rouge, Darrow, New Orleans and St. Francisville), Mississippi (Natchez and Vicksburg), Tennessee (Memphis), Missouri (Hannibal, St. Louis), Iowa (Burlington, Dubuque and Davenport), Wisconsin (La Crosse and Red Wing) and Minnesota (St. Paul).

'At a time where many of us are at home, looking for inspiration to travel in the future, I am pleased to introduce a new, modern way to explore this great river,' Viking Chairman Torstein Hagen said Monday.

'Our guests are curious travelers, and they continue to tell us that the Mississippi is the river they most want to sail with us,' he continued. 'The Mississippi River is closer to home for many of our guests, and no other waterway has played such an important role in America’s history, commerce and culture.'

Five-deck Viking Mississippi

With 193 all-outside staterooms, Viking Mississippi is inspired by the company's existing river and ocean vessels and will feature clean Scandinavian design, as well as public spaces that are familiar to brand loyalists but reimagined for Mississippi voyages.

And, Hagen said, 'No paddlewheels — real or fake.' 

The seven spacious stateroom categories range from 268 square feet to 1,024 square feet. All feature a private veranda or French balcony, king-size bed with luxury linens, large flat-screen interactive TV, mini-bar, large glass-enclosed shower, heated bathroom floor and 24-hour room service.

Big views and alfresco dining

The five-deck vessel sports expansive windows, a 360-degree promenade deck, two-story Explorers' Lounge facing forward and The Bow, an outdoor seating area for big river views. An Aquavit Terrace on the top deck, ideal for American-style barbecues, and a River Cafe will provide ample alfresco dining opportunities. A glass-backed pool will be situated aft.

Viking Mississippi's environmental features include solar panels, LED lighting, floor-to-ceiling windows that maximize natural light and an energy-efficient hybrid propulsion system.

Itineraries, enrichment and 'Privileged Access'

Itineraries include 'America’s Heartland,' eight days, St. Louis to St. Paul; 'Heart of the Delta,' eight days, New Orleans-Memphis; 'Southern Celebration,' eight days, New Orleans-Vicksburg-New Orleans; and 'America's Great River,' 15 days, New Orleans-St. Paul.

Hagen assured Viking will continue to provide 'the thinking person’s cruise' with destination performances showcasing regional music; guest lecturers on art, architecture, history, culture and the natural world; and 'Privileged Access' Local Life and Working World experiences, opening doors to places otherwise difficult to visit. Travelers can take a guided kayaking trip in the Louisiana bayou, visit a working farm near the Quad Cities or immerse themselves in Cajun culture during a Privileged Access excursion to the Rural Life Museum of Louisiana State University.

Inclusive pricing

Cruise fares include one shore excursion in each port of call, alternative dining, all port charges and government taxes, beer and wine with lunch and dinner, self-service launderettes, 24-hour room service and Wi-Fi.

Inaugural sailings for the 2022-2023 season are now available for booking by past guests and will open to the general public on April 15.

Hagen gives assurances as Viking pauses until July, debuts Viking.TV

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'We will be using this period of non-operation to work on further scientific steps to reduce health concerns about travel on cruise ships,' Torstein Hagen said

So began Viking Chairman Torstein Hagen's reassuring video address to customers today. He touched on everything from extending the company's suspension of service, to how it's treating the crew, its financial backing, the new Mississippi vessel and an antidote to the seemingly unending stream of bad news.

Resilience

Recalling challenges like the stock market crash of 1987, 9/11 and the global financial crisis, Hagen remembered how overwhelming they seemed at the time, but in hindsight, 'We can see how resilient we are.'

The stock market rebounded to new heights and people returned to explore the world in record numbers. 'Though it may look dark now, history shows we will work through this together,' he said.

Halting until July

Viking was the first cruise operator to suspend service, and in stretching that by two more months, it's also allowing more time than others have announced — until July.

'We will be using this period of non-operation to work on further scientific steps to reduce health concerns about travel on cruise ships,' Hagen said, adding: 'And I can assure you, we will only sail again when it's safe.'

Status of passengers and crew

Hagen said all guests but 14 are home, and eight of those are the sole passengers on Viking Sun as it heads to the UK. As for the crew, he expressed great appreciation and said those on the ocean ships would be retained until service resumes. Since the river season hadn't started, those crew were still home but arrangements were made for their compensation.

The Viking chief also assured the company's financial position is solid after an 'outstanding 2019,' adding that besides himself and his family, outside investors TPG, the private equity firm, and CPPIB, the Canadian pension plan investment fund, 'stand behind us.'

Hagen spoke from his apartment in Lucerne, Switzerland, where he's one of the many people working from home. That makes it tempting to frequently look at the news, he said. 'I don't mind facts. But I don't think it's healthy for the mind to have a constant barrage of negative images ... '

VikingTV

To that end, led by his daughter Karine, Viking's EVP, the company launched an experience channel, VikingTV, 'a venue where we can all be connected.'

VikingTV will offer live-stream sessions with Hagen, messages from the crew, entertainment hosted by some of his favorite artists, Viking-sponsored concerts, resident historian lectures and a live tour of Highclere Castle, the setting for 'Downton Abbey,' guided by Karine's friend Fiona, the countess of Canarvon and a Viking Longships godmother.

There will even be fun content for 'your grandchildren from my grand pup Finse,' Hagen added.

In addition, he announced the opening of bookings for Viking Mississippi, whose modern style and many Vikingesque features were revealed today.

How the CARES Act helps preserve the industry beyond the cruise lines

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Robert Kritzman said many entities that support the cruise industry may be provided a lifeline by the CARES Act

On March 27 Congress passed, and President Trump signed, legislation known as the Coronavirus Aid, Relief and Economic Security (CARES) Act. The cruise lines themselves may not benefit from this legislation and have accessed capital through other means. However, the many organizations that form the distribution network for cruises, service the ships; provide fuel, maintenance, food and other supplies to these floating cities; concessionaires, port agents, tour operators and numerous others may be provided a lifeline by CARES.

Small business assistance

Paycheck protection. The CARES Act establishes the Paycheck Protection Program, an expansion of the Small Business Administration (SBA) 7(a) loan program and appropriates $349 billion for the program.

The Act establishes the program’s eligibility to include companies with no more than 500 employees. Both full- and part-time employees are counted. For companies that fall into the North American Industry Classification System for accommodations and food service (e.g., hotels, restaurants), the 500-employee maximum helpfully applies to each location. 

Since many of the businesses that service the cruise industry are international organizations, it is important to point out that in some cases, a business owned/managed by a non-U.S. citizen, foreign business entities or non-immigrant aliens can be eligible for SBA financing. Eligibility for these entities will be determined on a case-by-case basis. 

The maximum loan amount is the lesser of (i) $10,000,000 or (ii) the average monthly payroll amount for the trailing 12 months times 2.5, plus the amount of any pre-existing SBA loan to be refinanced. The loan proceeds may only be used for payroll, employer group health, interest on mortgage obligations, rent, utilities and interest on other debt incurred before Feb. 15, 2020.

The interest rate for the loans is set at four percent. Collateral and personal guarantee requirements are waived. Repayment is deferred for at least six months, and up to one year, based on guidance to be issued by the SBA within 30 days after the date of enactment of the CARES Act. Loans made are nonrecourse. The loans are actually provided by SBA participating banks and financial institutions on an expedited basis. Most banks currently provide SBA loans.

Borrowers are eligible to have loan amounts forgiven to the extent the proceeds are used to pay for payroll expenses, interest on covered mortgage obligations, covered rent obligations, and utilities, during the period ending June 30, 2020. The loan forgiveness, which would typically be included as income for tax purposes, is exempt from income taxes. Based on the forgiveness provision of this program, there is little reason for an eligible business not to take advantage of this benefit for itself and its employees.

Emergency economic injury disaster loans and grants. The Act provides for Emergency Economic Injury Disaster Loans (EIDL) and grants for eligible entities for a covered period from January 31, 2020, to December 31, 2020. Eligible entities are similar to those under the Paycheck Protection Program. The applicants do not have to show that they cannot obtain credit elsewhere. The loan may be approved based solely on the credit score of the applicant (no tax returns required), or SBA may use alternative methods.

Emergency grants. Any eligible entity that applies for an EIDL can apply for a grant in an amount as requested by the applicant, but not to exceed $10,000. Grants are to be paid within three days after the SBA receives the EIDL application. These grants can be used for any allowable purpose, including payroll, paid sick leaves, cost of materials, rent or mortgage, or other obligations that cannot be met. The grant does not have to be repaid even if the EIDL is denied.

Subsidies for certain loan payments. The SBA will pay the principal, interest and any associated fees that are owed on certain existing loans (SBA loans, loans from state and local development companies, and microloans) for a six-month period starting on the next payment due (taking into account any deferment).

Large businesses

Title IV of the CARES Act provides $500 billion in emergency funding to the U.S. Department of Treasury’s Exchange Stabilization Fund to provide economic relief in the form of loans, loan guarantees, and other investments in businesses, states and municipalities impacted by coronavirus.

Airlines and national security. The government has committed $29 billion for direct loans or loan guarantees to the airline industry and $17 billion for businesses deemed critical to national security. We will briefly summarize these provisions since they do not relate to most businesses in the cruise industry.

Businesses eligible for this relief must have continued operations jeopardized by losses from the coronavirus crisis. To be eligible for the funding, other forms of alternate financing must not be reasonably available to the business. The Federal Reserve Bank will price assistance on a risk-adjusted basis and, if possible, at interest rates and terms based on market conditions for comparable obligations before the coronavirus outbreak. Borrowers and their affiliates cannot engage in stock buybacks, unless required under pre-existing contracts, or pay dividends, until one year after the date the loan or loan guarantee is no longer outstanding.

The Treasury Department will publish procedures for submitting applications and minimum requirements within 10 days of the date of the enactment of the CARES Act.

Other business and local government support. The remaining $454 billion is available to support relief to all other eligible businesses, states and municipalities in the form of interest-bearing loans, loan guarantees and other investments, including equity investments in programs and facilities established by the Federal Reserve Bank. Borrowers with direct loans under these facilities cannot, absent a waiver, engage in stock buybacks, unless required under pre-existing contracts, or pay dividends, until one year after the date the loan is no longer outstanding. The restrictions on compensation outlined above applicable to airline carriers and national security businesses likewise apply.

All applicable requirements under Section 13(3) of the Federal Reserve Act apply to these programs and facilities. This includes a requirement that any borrower be solvent (i.e., not in bankruptcy, resolution under title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or any other federal or state insolvency proceeding).

Medium-sized businesses

The CARES Act also provides for the Treasury Department and the Federal Reserve to work together to implement a special Section 13(3) Federal Reserve facility that provides financing to banks and other lenders that make direct loans to nonprofits and mid-sized businesses (500 to 10,000 employees).

Eligible borrowers applying for direct loans under this program will be required to certify, among other things, that the uncertainty of economic conditions makes the loan request necessary to support ongoing operations and the funds received will be used to retain at least 90 percent of the recipient’s workforce, with full compensation and benefits, through September 30, 2020, and the recipient intends to restore not less than 90 percent of its February 1, 2020 workforce with full compensation and benefits no later than four months after the end of the coronavirus public health emergency.

The recipient must also agree it will not pay dividends or conduct stock buybacks while the loan is outstanding, except for pre-existing obligations, and the recipient will not outsource or offshore jobs for the term of the loan plus an additional two years. To be eligible the recipient must be created/organized and domiciled in the U.S. with significant operations and a majority of employees located/based in the U.S.

The recipient must not be a debtor in a bankruptcy proceeding and must agree it will not abrogate existing collective bargaining agreements for the term of the loan plus an additional two years; and the recipient will remain neutral in any union organizing effort for the term of the loan. Businesses will need to evaluate the relative costs and benefits of receiving assistance given the foregoing requirements. 

Congress left a tremendous portion of the terms of these large company programs for the Department of Treasury to determine in regulations.  Those regulations are required to be issued within 10 days and will provide greater insight into the implementation and terms of these loans.

Conclusion                                         

The CARES Act also includes various tax benefits for individuals and businesses that are not addressed in this article. The small business program in the CARES Act is much more favorable than those for larger businesses, an established system of banks that make SBA loans already exists and far fewer conditions/strings are attached to those benefits. We will not understand the program for larger businesses well until the Treasury Department issues the implementing regulations. 

In addition to these government programs, businesses should be speaking to their creditors to defer principal payments on loans, drawing down on or obtaining additional credit facilities, if possible, and otherwise conserving cash. Many companies are dealing with and considering the implications of force majeure provisions in their various contracts. Now that many have moved to remote workforces, businesses will need to consider the cybersecurity implications. Additionally, the wage and hour laws and other employment laws will impact remote workforces. 

We all know that before long we will be addressing how to safely begin bringing employees back to work. The industry bounced back from 9/11 and the great recession and will bounce back from this crisis, though it may take longer than some industries due to negative perceptions created early in this crisis. In the meantime, the U.S. government has provided some valuable assistance to certain companies and those who are adaptable and prepared will be better positioned when that recovery comes.

Robert Kritzman can be reached at rkritzman@bakerdonelson.com.

March 30 updates: More lines delay (Viking until July), Australia cruise disembarks complete, HAL ships transit Canal, Princess briefs, China, CCNE Symposium

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Zaandam, pictured here, transited the Panama Canal overnight, along with Rotterdam, which took on 797 passengers from Zaandam

Keep checking back. This is being continuously updated.

Cruise Canada/New England Symposium postponed to June 2021

The Cruise Canada/New England Symposium, set for June 2-4 in Portland, Maine, is postponed until June 2021, dates to be advised. Portland will host. 

Multiple lines extend suspensions

Viking, the first line to announce a temporary suspension of service, extended that two months, to July 1. MSC Cruises extended through May 29, while Norwegian Cruise Line Holdings' three brands are waiting until May 10, Carnival Cruise Line unti May 11, Seabourn and Holland America Line, May 14 and Cunard, May 15.

Australian disembarkations complete

Cruise Lines International Association Australasia announced all Australian disembarkations are now complete, following Vasco da Gama offloading passengers in Fremantle (see below).

‘This leaves a number of out-of-service ships, either at berth or at anchor or in the process of leaving Australia,’ CLIA Australasia said in its statement. 

‘Cruise lines are now focused on the arrangements to repatriate crew to their homes and families and preparing their ships to be laid up with skeleton crew for the duration they are out of service.

‘Cruise lines are working with the federal government on approvals for out-of-service ships that are homeported in Australia to remain here, while it is planned that the rest of the ships will leave Australia as soon as practicably possible.’

Zaandam-Rotterdam transfer and Canal transits

Holland America Line's Zaandam and Rotterdam completed their Panama Canal transits overnight. Earlier, nearly 800 healthy passengers were transferred from Zaandam to Rotterdam (which was carrying only crew) in order to balance the workload on the two ships and to relieve the service staff on Zaandam, which has fewer crew working at this time.

The two ships will stay together for the rest of their journey. Passengers on both are remaining in their staterooms. Those who transferred to Rotterdam were screened and no one who had any respiratory symptoms in the last 10 days was taken, nor any crew.

Currently 73 passengers and 116 crew on Zaandam have reported influenza-like symptoms. There are 797 passengers and 645 crew on Rotterdam. Zaandam is now carrying 446 passengers and 602 crew. HAL hopes the ships can disembark at Port Everglades but approval has not been given yet.

Vasco da Gama offloads passengers

On Monday West Australian residents on board Cruise & Maritime Voyages' Vasco da Gama, which arrived in Fremantle Friday, were transferred by ferries to Rottnest Island for self-isolation while Australians from other states were taken in coaches to hotels around Perth. 

New Zealand passengers departed on flights early Sunday.

MD Australia Dean Brazier said it had taken almost five days to receive details of these passenger arrangements and that no cases of COVID-19 had been reported on board.

The ship, with 552 crew, departs Fremantle for Tilbury Monday evening.

Coral Expeditions’ ships in Cairns

Coral Expeditions has disembarked all passengers and Coral Expeditions II, Coral Discoverer and Coral Adventurer will be back in Cairns Tuesday.

Coral Princess service call at Barbados

Princess Cruises' Coral Princess, which has been heading north from Brazil since being turned away from disembarking at South American ports, is scheduled to arrive in Bridgetown, Barbados, Tuesday evening to take on provisions. No one will be permitted to get off the ship.

After that, Coral Princess will proceed directly to Port Everglades, with an estimated April 4 arrival. No COVID-19 issues have been reported on board.

Jan Swartz update on Grand Princess and Diamond Princess

Princess President Jan Swartz said Grand Princess remains anchored in San Francisco Bay, where the 14-day quarantine for crew began March 21. The line's care team continues to provide support for passengers in facilities around the US where they are staying for their quarantines.

'We just delivered thousands of care packages and are beginning to receive letters of thanks and praise for the crew, and their “above and beyond” professionalism,' Swartz said.

As for Diamond Princess, most passengers and crew have returned home from their quarantine facilities, and the extensive disinfection process of the ship has begun.

Costa in China

As of today, Costa Cruises has canceled 64 voyages scheduled to depart from Jan. 25 through April from China homeports and has offered a full refund or the opportunity to book a future cruise.

Impacted cruise ships have been Costa neoRomantica, sailing from Sanya, Xiamen and Wenzhou; Tianjin-based Costa Serena; and Costa Venezia and Costa Atlantica, both sailing from Shenzhen and Shanghai.

The ships are berthed or at sea near China, with upgraded sanitation protocols and free Internet access for crew. During this down-time, Costa has arranged more training for crew to help further their professional skills, service awareness and public health knowledge.

Royal Caribbean revitalization fund for China market

Royal Caribbean set up a 35m yuan ($4.9m) Special Fund for Tourism Revitalization and launched a series of supporting policies for tourism partners with the aim of helping restore confidence in the cruise market.