Please be seated. Good morning, Your Honor. Sean
Greacher from Young Conaway on behalf of the
debtors. Your Honor, thank you for setting this
special hearing time. We don't have a lot on
the agenda, and you may have noticed there's
not a lot on the docket, but there is, I can
assure you, a lot going on off the docket around
the world. So I thought maybe it's a good time
to give you just a quick update. My World Wildlife
Fund calendar in our kitchen said that yesterday
was National Dolphin Day, so why don't I start
with animal welfare issues. So the independent
director and the River On team have spoken with
authorities in Florida. We've been speaking with
the company's existing advisors. We've been speaking
with the company's employees who are located
in the Florida parks, particularly the veterinary
staff. We've also been speaking with parties
to serve as an independent advisor to the independent
director and CRO regarding animal welfare efforts
at the company's facilities. We're hoping to
have a party on board shortly to assist with
that. So that continues to be top of mind. Operationally
and financially, the river on. The team has made
good progress getting our arms around financial
and operational details at the U .S. Parks. As
Ms. Milke will be discussing in presenting our
emergency wage motion, we are engaged with the
company's employees that are doing what's necessary
to ensure appropriate stewardship of the business
and the animals. And of course, a critical part
of that is paying our employees. Governance -wise,
outside of the U .S., as we discussed at the
first day hearing, the process of effecting governance
changes that are necessary. based on the corporate
laws of various foreign jurisdictions, remains
ongoing. These are simply processes that in many
cases require some time. All is moving forward
on that front. Now onto Mexico. As we mentioned
at the first day hearing, the concorso mercantile
was filed by prior management with respect to
one of the company's Mexican entities. Evidence
has been provided in Mexico that this filing
was done without the requisite corporate approval.
The dismissal of that concorso has been... by
prior management's counsel and the judge overseeing
that proceeding has been reviewing the papers
and we expect that dismissal will occur shortly.
Additionally, the federal civil court in Mexico
City issued orders in joining the former CEO,
Mr. Albor, from acting as an authorized representative
of the company and voiding the board meeting
that purported to authorize that filing. We also
obtained an injunction that directed all governance
activities run through Mr. Strom and Mr. Wagstaff.
Those orders were obtained in Mexico City, the
federal civil court. On Friday last week, the
state court in the state where the company's
Cancun headquarters is located, which is Quintana
Roo. I tried to say that properly. I'm sure I
didn't. The state court there entered a companion
order recognizing the federal order. With that,
the River On team was able to, for the first
time, access the headquarters and begin to communicate
with staff at the headquarters regarding records
of the debtors that are needed to conduct these
cases. Unfortunately, at some point after midnight
on Saturday morning at the direction of the former
CEO, the headquarters building was forcibly and
illegally retaken. The Riveron team was barred
from the premises and prohibited from any further
communication with company staff or access to
the debtor's books and records. So the debtor's
professionals in Mexico were taking appropriate
steps to address that, to enforce the valid court
orders that have been obtained and ensure that
Riveron can regain access. Those efforts have
been feverish. They've spread throughout numerous
courts in Mexico. Council's been working around
the clock, traveling around the country, personally
appearing in court. and in person at the facilities
in connection with these various steps that are
being taken alongside the Mexican authorities.
Given the ex -CEO's conduct, we suspect that
this high level of effort will unfortunately
be likely to continue, particularly if the circumstances
continue to escalate as we fear that they may.
In the meantime, At a minimum, we view the former
CEO's actions to exercise possession and control
over the books and records related to the debtor's
assets, liabilities, and operations, and to bar
Riveron from access to such books and records
as brazen violations of the automatic stay. Additionally,
Your Honor entered an order on the first day
of the case compelling former officers, including
the former CEO, to turn over books, documents,
records, papers, ESI, and emails related to or
connection with the debtor's property and finances.
That order was sent to the former CEO's council
on April 4th with a demand for turnover of such
materials by last Friday, the 11th. There has
been no response to this demand from council
to the former CEO. Indeed, the former CEO's actions
this past Saturday morning suggest, I think,
an intent not to comply. All this said, assuming
no change in circumstances, the betters anticipate.
the need to file a motion as soon as possible
to enforce the automatic stay and to enforce
the court's Section 542E order. Given the urgency
of the request, we'd request a hearing on shortened
notice. Happy to work with Your Honor or Your
Honor's chambers to find a suitable time for
this hearing. Additionally, as we mentioned,
the former CEO's conduct has required Herculean
efforts from Mexican Council, firms that are
not familiar with U .S. bankruptcy and frankly
for whom. The expenditures of the time and costs
here have been very significant in order to ensure
that we can see this process through. And I'll
note, parties should have no doubt that the debtors
are resolute in their intention to see this process
through. We will be requesting authority to provide
some advanced retainers to Mexican Council, subject
to their retention as ordinary course professionals.
So we wanted to at least let Your Honor know
all that was coming, likely in short order. Any
questions about that preamble? If not, I'll turn
over the podium to Ms. Milky to address the motion
that we did file. I do not obviously reach out
to chambers as usual when you have papers that
are ready to be filed, and we'll figure out how
to squeeze it in somewhere. Thank you, Your Honor.
I appreciate that accommodation, as always. Good
morning, Your Honor. I'm Alison Milky of Young
Conway. debtors. Seems like a hard act to follow
after that update. As Mr. Greacher previewed,
the debtors have been working diligently to stabilize
operations, to gain the trust of their employees,
and to mitigate the uncertainty that these sector
11 cases may have caused. We are before you today
requesting some customary and limited relief
to ensure that the debtors can satisfy their
payroll, which is due to be paid today. The debtors
specifically are seeking authority to pay up
to $514 ,000 in payroll obligations. Those primarily
comprise compensation liabilities and wage deductions
and taxes. As indicated in the Wagstaff Declaration,
which was attached to the motion, the failure
to make payroll would severely disrupt the company's
operations and cause substantial financial hardship
to the company's employees, thereby causing irreparable
and immediate harm. Mr. Wagstaff is present on
Zoom today. We thank you for that accommodation.
He is available for questions of the court and
other parties in interest. At this time, we'd
like to move his declaration into evidence. Is
there any objection? I hear none. It's admitted.
Thank you. Your Honor, the relief we've requested
is very customary. I'm happy to answer any questions
that you have, but otherwise we'll rely on our
papers. Thank you. I guess the only question
I had in reading this is that this request goes
to U .S. employees. It does. And what's happening
with employees worldwide? It's an excellent question.
For the, we don't have visibility into the payroll
of those entities, and frankly we don't have
access and control to the books and records that
would inform us of that information. We are working
diligently, as Mr. Greacher mentioned. We will
be back before you with additional relief. anticipate
filing sort of traditional operational first
days with respect to the Florida entities and
those operations because we do have visibility
and control over those operations. And then once
we are able to further progress and with respect
to the Mexican operations. that are not in the
US and not in Mexico. I see Grand Cayman in Jamaica
and Rome. And maybe I should have asked Mr. Breacher
this, but what is happening with those locations?
Right, so to the extent they are debtor entities,
Your Honor, the information that's necessary
to... operate those is being held at the headquarters
in Mexico. So to some extent, the criticality
of getting into Mexico and getting those books
and records is really what will open up control
to all the other entities. With respect to Italy
and some of the other Caribbean entities that
are not quite debtors, we are presently undergoing
sort of the governance processes in those jurisdictions
to effectuate the transition of the board. So
in some, for example, in Barbados if there's
a notice requirement that requires various steps
in certain time periods to pass. So we are going
through those processes and complying with applicable
law in those jurisdictions. There have been site
visits? Not to, for example, Italy or Jamaica,
but we have been in contact with the operators
of those entities and we're in close contact
and trying to obtain additional information.
You could volunteer. Good. You're not the first
to have made that joke, Your Honor. I'll volunteer
for Italy. Maybe someone else would like to check
out Barbados. Your Honor, just to show and greet
you, Mr. Wagstaff has personally visited most,
perhaps not all, but most of the parks located
in Mexico. He did look at them from the outside
looking in to some degree, had some communications
with individuals at the parks, but... Given sort
of the situation in Mexico the that process is
complicated. Yeah Okay, I hope in Mexico people
are taking whatever security precautions need
to be taken including Retaining security to the
extent necessary. Yes Okay, okay, does anyone
wish to be heard with respect to the employee
wages motion I Hear no one I did review it We
just discussed it addresses the U .S. employees,
which the debtor has visibility into. And the
relief is obviously appropriate. We need to ensure
that employees who are working get paid. Nothing
in the motion shall be deemed to violate or permit
a violation of 503 C. I assume that language
I think is a little. Well, I assume what this
language says is we're not giving anyone any
insiders, any bonuses, etc. Correct, we're not
authorizing. Yeah, payments made pursuant to
section 503 C. So let's, why don't we say it's
not being authorized. There are no, rather than
that, I think that's actually better. Nothing
in this emergency order is authorizing or permitting
any payments under 5036. We can make that, and
just to clarify, I think you said paragraph four,
but I think that's paragraph three. I've got
it as paragraph four, so am I looking at the
right order? Let's make sure I'm looking at the
right order. I'm sorry, I'm looking at the final
order. I apologize. I understand why this is
in here, but I would prefer to deal with future
debtors in a separate motion or something else,
but not preview that. We did upload an order
in advance of the hearing, so just to confirm,
we will revise the order and upload a replacement.
Yes, then there's no reason to do a COC on that.
Okay. That's all we have for today? Okay, very
good. We're adjourned.