Exactly one week ago, Diamond formally submitted a motion to the court to change their chapter 11 to chapter 7. With that submission was a new agreement between Diamond and JPMorgan concerning lending to get them through chapter 7. JPMorgan refused to extend credit further when it came to Diamond’s chapter 11 process, part of the reason for the status change.

The Ad Hoc Committee of Consignors objected to some of the details of Diamond’s proposal including a shift in the time period for some of it, some payments Diamond included, and specifics regarding inventory.

A hearing was held December 16 during which the court was fine with the chapter 7 as a whole but there were suggestions to amend their proposal before it’s finally approved.

Some of the major changes is how the claims will be handled, the timing of some things, but one of the biggest is an escrow account disbursement.

The Ad Hoc Committee of Consignors’ counsel and the Consignment Group counsel will receive $156,000 and $144,000 respectively. The amounts will be applied to each of their asserted administrative claims accrued prior to May 15, 2025.

All contested matters and adversary proceedings in the bankruptcy case are stayed until February 16, 2026.

You can see the new filing as well as the redlined version below.

Update: The order approving the plan has been submitted as well.