Such a move would leave unsecured creditors with nothing, he said.
The plan will give unsecured creditors 85 percent of the company's stock.
The unsecured creditors would receive about $80 million in total.
Unsecured creditors would receive less than $500 million of the company's total value.
The plan must also be approved by a committee of unsecured creditors.
Still, it is uncertain whether the unsecured creditors will end up with any money.
The deal includes payments for the team's unsecured creditors of about $2.5 million.
It did not provide a list of secured and unsecured creditors.
"With whole life you're a general, unsecured creditor of the insurance company," he said.
The new offer from Diamond has been approved by the committee of unsecured creditors.
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