Hearing Held in Diamond Case to Review TPA Motion
The U.S. Bankruptcy Court for the District of Delaware held an
emergency hearing this morning in the case of Diamond Glass Inc.'s
petition for reorganization under Chapter 11 to review a supplement
to Diamond's motion authorizing them to honor or pay pre-petition
customer obligations. The supplemental to the motion, authorizing
Diamond to honor or pay prepetition obligations arising under the
third-party administration (TPA) program and to continue the TPA
program, was filed when the company realized that the TPA program
"was inadvertently omitted from the description of the Customer
Programs in the Customer Obligation Motion." (CLICK
HERE for related story.)
"Accordingly, the Debtors file this Supplement and seek entry
of an order authorizing the Debtors to honor or pay pre-petition
obligations arising under the TPA Program and to continue, renew,
replace, modify and/or terminate the TPA Program as they see fit
in their business judgment," the motion reads.
Court documents note that as of the petition date, a substantial
amount of work had been performed by third-party repair shops that
had not yet been paid in accordance with Diamond's work as a third-party
administrator. Diamond notes that it expects the total amount to
be paid for pre-petition work by third-party shops "not to
exceed $105,000 in the aggregate."
"Any delay in honoring or paying Customer Obligations under
the TPA Program will severely and irreparably impair the Debtors'
customer relations, as well as the Debtors' relations with the Third-Party
Repair Shops, at a time when the loyalty and support of their customers
and Third-Party Repair Shops are extremely critical," the motion
Judge Christopher S. Sontchi, who is overseeing the Diamond case,
granted the motion during this morning's hearing.
HERE for full text of motion.
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