Decorator Industries Inc. (fka DINIQ)

[Renee]

DINIQ: Bankruptcy plan effective. Shares cancelled.

http://www.otcbb.com/asp/dailylist_detail.asp?d=10/17/2012&mkt_ctg=NON-OTCBB

[mrholty]

Absolutely.

He was right.

I first bought at the initial and then didn't chase beyond $.04. It was worth the risk/reward for myself at that point.

Then I got excited by the Loopnet post that it sold for $1.2M. Logged into loopnet myself saw the sale. Put together my own spreadsheet and started tracking stuff. Bought more in the $.17 and $.19 range. Saw where the building in Indiana sold for stalking horse bid and not the $1.2M. Called the realtor who did the sale and she confirmed the price, etc. That was a big negative hit and I decided to hold and not add anymore.

Then started to see other locations sell for inventory.
Called the CEO spoke to him for 10 minutes. Thought about it overnight and then proceeded to sell where and when I could.

My screwup in early May ommitting legal fees was the big mistake. Luckily I got out for my cost less PACER which will not be cheap.

[jaxstraw]

....delay and expense.....

Two main things that WS61 has been warning about since he first started posting.

[mrholty]

I know. I do thank you. Thanks.I had pulled PACER on Friday evening and the two important ones were not there at that time. My thoughts per my post at the time were signalling much of what I thought.

I spend some more time going over my numbers that I had posted from early May (http://investorshub.advfn.com/boards/read_msg.aspx?message_id=75079260)

I was long the stock at the time of my post but as I looked at the numbers in greater detail I ended up calling the company as my math had only $1M of wiggle room and I had not included any legal fees which was a big ommission.

I called the CEO, who is the only employee left at DI and asked what the plan was. He told me straight up that the original plan was to file BK and sell the Mobile Business as they had lost the contract for that drapery business in mobile homes and the plan was to reorganize and consolidate plants around the hospitality business. I asked about why the OCC objected to the sale of the mobile division in December and he couldn't say. His last statement was that delay and expense caused a shift from a reorg to a liquidation. Once he said that I assumed equity was toast and sold out.

[wall_street61]

Tease? I was doing you a favor if you were trying to exit. The high end estimate to creditors is 56%. Commons get zilch according to their numbers. Hit that bid.

[mrholty]

Why do you tease? I just cannot figure out who is sitting on the bid @ $.12 right now. Its only $600 but still.

[wall_street61]

What was the estimated percentage payout for unsecured creditors according to the liquidation plan?

[trendtraderz]

Sadly my over enthusiasm was in full stride between the summary of schedules and diniq mentioning what was best for equity in some filings. I've played enough bk's to know better. They are all junk w/ very few exceptions. Let's wait and see which category this one ends up in.

[wall_street61]

Ultimately when the POR comes out in June, my opinion is that it will be a shares cancelled and a $1.50'ish per share disbursement. I don't believe there is any mystery behind this as to a reorganized company coming out of this and doing business whether it be textiles or any other thing for that matter.

well trendtrader, how did that POR pan out? I see you have a pacer account now and I know the plan has been filed.

Well?

[mrholty]

Not a fan of todays filings by the OCC.

I cannot figure this out. The OCC is basically claiming mgmt fraud and wants to go after D&O claims. If they were getting paid in full there would be no need for this and really they should be silent. If the debtors aren't getting 100% then equity is a zero.

Second, this looks like a fight between DI Mgmt (1 person) and the OCC. For equity this looks like a fight that will get expensive quick and for such a small float that is bad news.

Disappointing.

[trendtraderz]

Okay they let me onto pacer. No por yet.

[trendtraderz]

I singed up for pacer last nite to view the POR but they havent sent me my password yet. Do you know if it's been posted yet? Thanks Jaxstraw

[trendtraderz]

The guy at .18 pulled his shares. Probably in anticipation of the POR being filed today. Here at .11 cents a share the market is anticipating a $348,902 assets over liabilities market. After my initial burst of research I really haven't given much thought to DINIQ but I sure as heck see more than 350K in value here.

[trendtraderz]

Thanks for that. I guess it beats another month. lol

[jaxstraw]

11. By this Motion, the Debtor seeks an additional brief extension of the Exclusivity
Period for an additional seven (7) days through and including June 8, 2012, and a corresponding
seven (7) day extension of the Acceptance Period through and including August 7, 2012.

https://viewer.zoho.com/docs/dYWaG

[trendtraderz]

Two more trading days until the POR should be filed. Assuming no more extensions. DINIQ go big baby!

[mrholty]

When was this. Point Blank (PBSOQ) initial POR from the fall of 2010 had something like what you mentioned and I know that equity holders and others referenced section 1123(a)(4) which states:

a plan shall - . . . (4) provide
for the same treatment for each claim or interest of a particular class, unless the holder of a
particular claim or interest agrees to a less favorable treatment of such particular claim or
interest.”

They were successful on this part as the US Trustee also objected to that language. Did anyone in your case do anything similar?

[Superfly15]

I requested a POR from the lawyer if that's what you were asking. I bought some shares @ .10 but ended up losing the $ because I "didn't qualify."

[trendtraderz]

Wow! I jut went and read that board. Did you not get a release mailed to you? Looks like some of the other small timers got theirs. Anyways a little over two weeks until the the POR here at DINIQ, assuming no more extensions. I'm ready!

[Superfly15]

The only thing you need to worry about is them trying to cancel small shareholders out / going private. I was in one (EMAKQ) where common ended up being in the money (without a fight) but the CEO worked out a deal where only people holding "X" shares and up were allowed in the POR. They were a low O/S and profitable too.

[trendtraderz]

Jax- thanks for that read. Also thanks for that tip on that other security that you pm'd me. As far as DINIQ goes have you given any thought or done any research on taxes, tax refunds, and lastly NOL's for 2011? I know they received a 1.2M refund for 2009. Here is a quote from a PR from the 2009 year end "In addition, based on the recent change to net operating loss carryback rules we will be receiving a $1.2 million tax refund." I haven't looked to hard for 2010 yet, it may be a little harder to find as that was the year of the deregistering of their securities. I am not a great tax legal mind and definitely do not know what the implications / ramifications of the selling off of all of the assets will be pertaining to the tax situation. Maybe thats why they kept the Haleyville property in effect, I know there are some pretty strict regulations concerning NOL's and the utilization of them. 1)Being a ongoing concern? I havent really invested much time lately pertaining to DINIQ research but if they have a tax refund anything like 2009 that will help out immensely in PPS valuation. Heck if they got 1M refund x 3M shares, that .33 PPS alone! Heck even selling a clean shell company garners between 250k to 500k. Granted we dont really know the end game here yet, but I am confident that they are A) in the money B) maximizing shareholder value. I recently read some of Robotti's shareholder activist letters and with his guy Chris Sansone on the board I'd like to think that equity is protected pretty well concerning this.

http://www.robotti.com/media.php

Hopefully we will see what exactly will be happening here in a few short weeks. In the past I have seen companies that have liquidated do an initial disbursement to shareholders and then succeeding disbursements as things wind down, i.e. tax refunds etc...

[jaxstraw]

MOR 3/1 -3/31 2012

https://viewer.zoho.com/docs/ob3b5d

Page 41 is of most significance.

[trendtraderz]

Yup, I bought some more also. Nice little pick up for me on a small amount of money volume to the downside ($3,452).

[mrholty]

Looks like I was right. I just bought 5k more shares @ $.10 but someone else has bought a bunch right @ .10 and .13.

[mrholty]

Wonder where that guy went? Looking at the tape today somebody desperately wanted to unload. Last time that happened it caused the pattern in your note. Wonder if we will again.

I may buy more if I can sell another illiquid security I won.

[mrholty]

I deleted my Prior Post #172 as I tried to clean it up (easier to read). The numbers are the same.

Trend- The Abbotsford amount of $1.3M was not the actual proceeds to the company. The sale to the company was $725k for Furnishings, fixtures and equipment plus inventory. I know the article states $1.3M but that is not what they paid DINIQ per PACER.

WallStreet61 - Forgive TrendTraderz for being on autopilot. He bought 50k shares at $.0016 for a total of $80. Him logging onto Pacer to check sales would cost him more than his investment. I went back and checked all his numbers and I'm not as optomistic as him but I expect a double from here.

Property Sales:
Goshen, Indiana - $550k
PA Property turned over to WellsFargo - $0
Haleyville Property- being leased via DINIQ - $0.
Red Bay, Al - nothing yet
Cash $1.0M
AR - $1.3M
Physical Property (fixtures etc) - TTrenz found online. His estimate was $200k +200k

Inventory - Haleyville $380k
Inventory - Goshen, Ind - $375k
Inventory - Abbotsford, Wi - $725k
RV business Goshen, In - $155k
Net Customer Deposits (was included in sale @ Abbotsford)
Total Assets - $4.854M

Schedule of Liabilities - $3.5M
Wells states they are owed $400k
To be conservative Total Liabilities - $3.9M


More positives to come -
Superior business in NJ - filing earlier this week states that business will be sold for assumption of lease plus something else. Assume they get the inventory value for the inventory + FFE that is $115k.

Red Bay, AL property (filing states $550k)
Red Bay, AL inventory (filing states $269)

In summary, what I've seen here is the properties are selling for Inventory. The one building in PA is a definite zero.

Re Hayleyville Property: I don't know how to value the lease of the Haleyville AL building as the lease states that DINIQ is going to be the leaseholder and they will make payments to Wells. Not knowing the taxes, etc for the building I figured they would need 8-12 years there to break even to pay back Wells. I struggle thinking that means they are turning it over for $0 value to Wells. I think my $0 is conservative but I don't know how to value it otherwise.

We know they are liquidating and not reorganizing as they are selling the customer lists as part of these deals. My simple math of A-L puts my downside at around the current share price with some upside and we'll know in a month. worth my gamble imo.

[trendtraderz]

Where would the 1.3M Abbotsford sale be included in your post? Under the 725K inventory?

[mrholty]

I've been keepung track of everything. I'll post it tonight when I get home.

[wall_street61]

I did not know where that information was coming from.

Uh, court documents. Which leads to my question. If you don't know the particulars I asked of you, just where are you getting your information?

[trendtraderz]

Great thanks! I did not know where that information was coming from. I do not have a total of all the assets sold. Enjoy your day!

[wall_street61]

No, actually I quoted a paragraph from the sale court order, which was signed on April 17th. It's over and done with, got it?

https://ecf.flsb.uscourts.gov/doc1/050121608119

Do you have the total of all the assets sold up to this point, or do I have to go do that also?

[trendtraderz]

Yup I get that. The stalking horse bid was 380K, which you quoted in your post. Have you seen finalization of the sale price? I haven't. It was to close last Friday. Like I said I am on cruise control here at this point. I've done all the research I needed to make my investment here. Feel free to post any kind of information you find if you choose to dig deeper. Have a great day!

[wall_street61]

Yeah, real estate book prices. That's 2.75 million. The personal property is listed as 5.3 million or something along those lines.

The mobile home sale came in a couple hundred under what you have posted, not exponentially more.

"The Debtor is authorized to sell the Assets more specifically described in the
schedules attached to the Agreement including, furniture, fixture, equipment and trade names for $35,000 and fabric and supply inventory for $344,790 for an aggregate purchase price of
$379,790.00, subject to certain credits set forth in paragraph 3 of Schedule 1.6 of the Agreement at Closing, free and clear of all liens, claims and encumbrances and interests to Haleyville."

You don't have to be a CPA. Just tell me how much they have sold and subtract the liabilities from that.

thanks

[trendtraderz]

I havent run any valuations lately. And that may be difficult to do now with the Abbotsford WI sale. Where you would deduct the 1.3M they were paid for the business out of the summary of schedules would be difficult unless you are a CPA and I am not. I would assume that the tools and clients were what is sold in that transaction. I believe the building was sold some time in the past (prior to BK) as they had been paying a monthly lease stipend when they entered into BK and wasnt listed in the assets on the summary schedule. The sale of the mobile home division assumedly closed last Friday. I have not seen any online information yet as to the final sale price. It was a stalking horse bid starting at 380K, but from all of the previous stalking horse bid sales, I would think it's safe to say they garnered more than that. And possibly exponentially more. Assets listed going into BK were 8.4M and liabilities at 3.4M. They have been getting more than book value on real estate sales. We are only a month away from POR, hopefully it doesnt need to be extended and we get a peek behind the curtain. I am on cruise control here and not concerned with creditors vs equity situation. I believe creditors will be made whole and there will be 5M for distribution. Good luck!

[wall_street61]

TTZ,

Sir, could you kindly help me with the math? Could you add up the proceeds from all the sales, and then apply them to the liabilities in total, so us folks who aren't following closely could analyse the situation?

As for all the EC speak, requests to the trustee for EC formations are private, and there is no duty to make those requests public, so whether or not no requests were made or 20 requests were made, we may never know.

What I can assure you of is that when CC's and EC's start competing for distributions, they will blow through $5 million dollars in legal fees before you can eat a bag of microwave popcorn and fart twice.

Be careful what you ask for. This is a 'damned if you do, damned if you don't' crapshoot at best. In the real world your logic may have some merit, but this is BK world, and it can be the farthest from 'real' as you can imagine.

[trendtraderz]

I think they realized that the true valuation put the company at roughly $ 1.50 or better, and realized that the OTC is very illiquid and probably would never see an actual true valuation ever again. Although Robotti will never see anything close to what he paid for his shares, at least he will recover more than he ever could down here in the wild wild west also known as the OTC. On some of his form 4's were from $5.00 and up. I am looking forward to June 02, 2012. After that I will have 6 months to burn through the proceeds prior to the Mayan calendar date for the end of the world. See you all on the other side!

[trendtraderz]

MM's are messing with this now. I have a bid order in for .20 and its not showing up on the level 2. Bogus!

[trendtraderz]

I am certainly not a BK guru but in my opinion a chapter 11 gave them more flexibility and the appearance of some sort of leverage in negotiations. Which seems to be the modus operandi of quite a few bankrutcies, hell even Lehman went chapter 11 and that thing was so underwater it wasn't even funny. Ultimately when the POR comes out in June, my opinion is that it will be a shares cancelled and a $1.50'ish per share disbursement. I don't believe there is any mystery behind this as to a reorganized company coming out of this and doing business whether it be textiles or any other thing for that matter. These guys arent the "magical" typical otc pink player that change their business direction every year or so, like so many of the hustlers down there seem to do. There selling off everything and getting more than what they had for book value on the summary schedule. I think they gave up the ghost so to speak when they realized how shitty it is to trade on the OTC's. I see this also as another reason they gave Robotti a board position, so they could participate in the unwinding. As a shareholder only, material information would not have been privy to them. At which point we definitely would of seen an equity committee. I am pretty confident in the way this will pan out. Every thing will be sold off at a premium to book value no less. In early may they have those RV BK claims to deal with and then probably all the other administrative stuff. After that the POR which I think will be accepted by the creditors as they will have plenty of liquidity to make them whole. Like I said earlier in this post my guesstimate is $ 1.50 per share.

[mrholty]

So I spent some more time working on this last night and I am happy that I did. While I don't disagree with TrendTraderz there are a few things here that are confusing to me.

They have three divisions: RV (Indiana), Mobile Home (Haleyville, Al and leased Bossier City, LA) and the Hospitality (hospital/hotels) Division mainly in Abbotsford, Wi with the Red Bay, AL property listed as supporting the Hospitality division and not the Mobile Home division.

The Asset Purchase agreement for the RV division to Ascot (IN) and I believe the sale to Haleyville Draperies (AL) and DI (WI) I know included the sale of current customer contracts and I would assume some sort of NDA to protect the buyers although I didn't see that language. Add in the fact that these guys have sold everything except for building in Red Bay, AL but they sold the FFE in there. Everything has been monetized other than this and some inventory in locations that I don't know where they are so I assume are $0. So why not chapter 7, why Chapter 11? What are their plans?

[trendtraderz]

Thanks for that! It's nice to see another 1.3 Million in the coffers for disbursement. This thing is obviously a full blown liquidation with the assets far exceeding the liabilities. Obviously DINIQ realized that this was the best way for recovery to the shareholders. Hence Chris Sansone's appointment to the board prior to filing of the chapter 11. Hopefully some of my other plays can get a little giddy up in them prior to the POR being filed, so I can get a few more tickets for the show.

[goldcanyon341]

Abbotsford, WI


http://www.marshfieldnewsherald.com/article/20120419/MNH03/204190618/Abbotsford-plant-manager-buys-company-save-nearly-50-jobs?odyssey=tab|topnews|text|FRONTPAGE

[jaxstraw]

As far as an EC. Wallstreet61 brings up some very good points as to the reasons why it would be a negative aspect in this case. And he, bar none, is the most experienced BK knowledgeable member of IHUB. Check out his posts on this subject.




!

[ChuckD-MSB]

Superfly sent me a text several weeks ago about them when they were under .05 and I took a brief look at the trading history and saw very little volume and decided I probably would not be able to get enough shares to make it worth my time, wish I had listened to him and bought whatever someone was willing to sell me. LOL

[trendtraderz]

Assuming there isnt another POR extension we will know the details in a little over a month. The to good to be true aspect imo is that there are very few aware of this company and situation. I know I'd never heard of them until I saw there ticker symbol on otc markets as I was plugging in another DI__ symbol and the prompt box under showed it as the possible one I was looking for. It wasn't but because I'd never heard of it I figured I'd better look into it. After doing some research I bought in. And then made a IHub board for it.

[mrholty]

It's very difficult to obtain shares. The bid/ask is very wide. On Thursday or Friday it was .17/.30 with 5k shares at .30 and the next 5k at .40. Kind of hard to pay for pacer when you don't even know if you can build a position.