The deadlines are listed as "milestones" in the financing agreement; if missed, they put Diamond in default. The key dates for the asset sale are that 25 days after the bankruptcy petition was filed, a procedure for bidding on the assets must have been ordered by the court; 45 days after that, the auction has to be completed; and 22 days after the completion of the auction the sales transactions are to be consummated.
Based on those milestone dates, the asset sale auction is to be completed by or before March 25, and the transaction(s) closed by or before April 16. Diamond has a stalking horse bid for Alliance Game Distributors and has agreed to sell Diamond UK, so it has a good start. Given its losses of publisher clients in recent years, Diamond Comic Distributors will be tougher to value. Diamond Select is also on the block.
The financing agreement provides for a maximum of $41,000,000 in lending from JP Morgan Chase; $32,600,000 of that is debt that Diamond owed at the time of the filing. So up to an additional $8.4 million is available to Diamond to finance its operations as it prepares for the sale. Diamond submitted a budget, which must be met to keep the company within the limits of the financing agreement, showing its needs at roughly $6.9 million for the period.
A big part of the expenses over the next few months are the legal and other fees related to the bankruptcy (see "Restructuring Advisors"), which are expected to total $5.255 million during the 13 weeks in the budget Diamond submitted, including a $1.5 million transaction fee to Raymond James.
Diamond Founder Steve Geppi has a lot personally at stake in the success of the sale: he has a personal guaranty on the DIP financing.
All in all, the financing order lays out a tight schedule for the sale of the company's assets; Diamond's creditors and customers hope events go smoothly as planned.
