Species 1 is your seventh structure. The C=N=N atoms are linear and a long reach for the remaining nitrogen. Electrocyclization of 1 to 2 restores aromaticity. Nitrene species 3 allows for a 1,2-shift to an electron-deficient center with concommitant loss of strain in the 4-membered ring to produce 1H-benzo[d][1,2,3]triazole 4.
Cyclization of 5 $\rightarrow$ 6 and dehydration via 7 gets the job done. Perhaps @Mithoron knows something that I am not aware of.
