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Old 09-08-2009, 11:01 AM   Nav to Top  #241
Miles
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It's true! Reverse split coming...

Source: SpongeTech Delivery Systems Announces Reverse Stock Split to Move Closer to NASDAQ Listing | Reuters


NEW YORK--(Business Wire)--
SpongeTech Delivery Systems, Inc. ("SpongeTech") "The Smarter Sponge", (OTCBB:
SPNG) today announced that its Board of Directors has unanimously approved a
reverse split of SpongeTech`s issued and outstanding capital stock at a
1-for-100 split ratio. The reverse stock split, which is expected to take effect
on September 22, 2009, subject to receipt of necessary regulatory approvals, has
also been approved by the holders of more than a majority of SpongeTech`s voting
capital stock.

The same 1-for-100 reverse stock split ratio will be used to effect the reverse
stock split of SpongeTech`s issued and outstanding common stock, Class B Stock
and preferred stock. Accordingly, all stockholders will be affected
proportionately.

"This reverse stock split - which we believe will bring our company`s Wall
Street profile in synch with our business profile - is another important step in
the development of SpongeTech," said CEO Michael Metter. "Combined with our
recent engagement of Deloitte Touche LLP as our public accountants and our plan
to apply for a NASDAQlisting, the reverse stock split demonstrates our
commitment to establishing SpongeTech as a world-class company whose capital
structure, operations and infrastructure all match the impressive sales growth
we are achieving.

"We continue to expand our product portfolio, licensing agreements, and sales
and marketing programs, and are very excited about the record-breaking order
flow these efforts are producing. Our July 2009 acquisition of Dicon
Technologies, a recognized product innovator with exceptional R&D capabilities,
established distribution channels in the U.S. and Asia, and many large, direct
commercial customers, perfectly positions us to leverage the many exceptional
opportunities in our targeted marketplace. We`re committed both to building
SpongeTech into a global player and building shareholder value, and this step
will help us realize each of these goals."

An amendment has been filed with the Delaware Secretary of State that amends
SpongeTech`s certificate of incorporation for the reverse stock split, effective
as of 5:00 pm ET on September 22, 2009. SpongeTech has also begun the approval
process with the appropriate regulatory authorities.

In conjunction with the reverse stock split, the Board of Directors and the
holders of more than a majority of SpongeTech`s voting capital stock have
approved a decrease in SpongeTech`s authorized capital. The post-split
authorized capital will be 900 million shares of common stock, 25 million shares
of Class B Stock and 40 million shares of preferred stock.

As a result of the reverse stock split, every 100 shares of SpongeTech`s stock
will be combined into one share. Options, warrants and other stock-based awards
will be adjusted on a similar basis. SpongeTech will not issue fractional shares
in connection with the reverse stock split. Any fractional share which might
result from the reverse stock split will be rounded up to the nearest whole
share.

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Old 09-08-2009, 11:04 AM   Nav to Top  #242
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Originally Posted by Miles View Post
It's true! Reverse split coming...
So what's everyone take on this?? Is now the time to stock up???
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Old 09-08-2009, 11:20 AM   Nav to Top  #243
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i can understand the state of the stock being low maybe itll go up and down and u can make money day trading it, but long term i dont think this company is going to go anywhere their product is stupid.
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Old 09-08-2009, 01:17 PM   Nav to Top  #244
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Originally Posted by Longshot View Post
So what's everyone take on this?? Is now the time to stock up???
Well it's a bit of a surprise but it does say a few things. A move to the Nasdaq should signal to some investors that they are a 'real' company worthy of an investment.

New market cap will be 12,490,000 and @ $15 (est. PPS) that makes the market value for SPNG around $187m. Not bad for a company profiting under $10m/quarter (currently) and a book value of around $20m (Q1 '09). Note that I could be wrong on these figures as Google's data is often incorrect.

Wild speculation: Spongtech's new revenue numbers (already quite late) could be released to somewhat coincide with the move onto the Nasdaq, propping the share price going forward on the new exchange. It would seem Sponge's recent sponsoring of the US Open and the curious move of dumping $4m into GetFugu (GFGU) signal they have had a good quarter.
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Old 09-10-2009, 08:55 AM   Nav to Top  #245
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I'm so angry about that stupid Getfugu investment! I know it is an advertising vehicle for them, but cmon $4 million? On an untested iphone toy??

The RS doesn't have me that worried and a poster (Sponge Bob) on Google Finance from this thread explained it best:
let me tell ya how this is gonna happen....

10K will bring the pps up again...lets say .15 and the O/S to like
500M
R/S will bring the pps up to $15 and the O/S to 5M
Price will drop to $10 at the most...only 5M shares....whos selling at
this point?
They will get listed on Nasdaq...price will go up.
They will slowly issue 5M shares...bring in over $50M
They will forward split the 10M shares into prolly 50M
Also, somewhere in there the 10Q will be released driving the price
higher.
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Old 09-12-2009, 01:17 AM   Nav to Top  #246
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I've had a week to digest this whole situation. At first I was angry only because I was hoping to see SPNG grow from .20 to over $1.00 in the next year. But I've been worried about the bulletin board manipulation of this stock for some time. Perhaps it was never possible for that kind of growth without a move to NASDAQ.

I know there has been a lot of talk about a possible forward split. That is a possibility. But at this point, I have to assume it won't happen. I've been a long term investor in this stock for awhile. But I've decided for the next 3-4 weeks I need to day trade SPNG because it will be quite volatile.

I still love the long term potential of the company, the products and their growth. But the stock has been kicked around too much. This r/s and subsequent listing on NASDAQ is just what the doctor ordered.

I intend to ride this up until the release of the 10-K next week, then sell before the r/s. The pps will fall and after about a 20%-25% drop, I'll get back in and stay long for the future. It seems to me it is the only way I can protect my investment at this point other than simply holding and hoping for the best which I can't do. And that isn't because of SpongeTech. I'm worried the market will beat the crap out of the stock for as long as it can -- at least until the NASDAQ listing.

This company is solid and they have shown over the past 3 months they are serious about their organization and the growth potential. I plan to be an investor for the next several years and quite possibly longer.
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Old 09-13-2009, 06:26 AM   Nav to Top  #247
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info here on reverse split for newbs like myself:

Reverse stock split - Wikipedia, the free encyclopedia
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Old 09-17-2009, 11:00 AM   Nav to Top  #248
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The bad news is not ending for SPNG, this time the NY Post. Please note that the guy being quoted in the article is none other than Tim Sykes (An American Hedge Fund). This guy is a bit of knob. If you have any doubt download his PennyStocking DVD from your favorite torrent site. The problem I have is I am starting to agree with him.

New York Post (source)
09/17/09
NEWS . SPORTS . PAGE SIX . BUSINESS

Not Spongeworthy
By KAJA WHITEHOUSE

Maybe SpongeTech should use one of its sponges on its financial books.

While the company behind popular soap-filled sponges looks like it's flying high, and one of its ads at the US Open unexpectedly took center court when tennis star Serena Williams screamed at a line judge seated nearby, the Manhattan-based company's business tactics have raised questions with regulators.

The Securities and Exchange Commission hasflagged SpongeTech's financial statements for the last two years because of problems with the company's auditor. What's more, the company missed yesterday's deadline to file an annual financial report with the SEC.

And its ticker is in jeopardy of being tagged with an "e" -- the financial equivalent of a scarlet letter that warns investors that the company hasn't complied with SEC reporting rules.

Meanwhile, the company's complex dealings with its penny shares have led to accusations that SpongeTech is running a stock manipulation scheme -- complaints that have made their way up to the SEC.

SpongeTech, which sells its wares through infomercials, posted an eye-popping 900 percent surge in sales, according to a June press release reporting that revenue had hit $50 million for the 12 months ended in May, vs. $5.6 million a year earlier

But on Friday, SpongeTech received a letter from the SEC ordering it to redo its financial statements for the last two years, including the one that just ended.

Drakeford & Drakeford, a firm with offices in three cities, including Los Angeles and New York, but just one partner, was SpongeTech's auditor. Drakeford lost its accreditation from the Public Company Accounting Oversight Board on June 16, according to a letter from the SEC.

"It has nothing to do with us," SpongeTech CEO Michael Metter told The Post.

But SpongeTech's replacement auditor, Robison Hill & Co., doesn't appear to be in the best standing with the PCAOB, either.

In a report earlier this year, the auditing watchdog blasted the Utah firm for numerous "audit deficiencies." The PCAOB determined that Robison "did not obtain sufficient competent evidential matter to support its opinion" on its clients' financial statements.

Metter acknowledged the report to The Post, saying he and his team "didn't know that" when they hired Robison in July. He said SpongeTech hired Deloitte & Touche to "oversee" Robison's work for 2008 and 2009, and to take over. Metter also said that SpongeTech has asked the SEC not to penalize it for the late filing.

Meanwhile, the company's complex stock trail has raised suspicions of stock manipulation. Timothy Sykes, a penny-stock trader and author of a book about running a hedge fund in college, has publicly accused the company of being "a blatant pump and dump" scam.

Sykes cites the fact that as of March, the company had 1.55 billion shares outstanding -- a 1,500 percent increase over last year. Several months prior, the company issued more than 300 million shares to a company tied to its executives, RM Enterprises, at a 40 percent discount.

More recently, SpongeTech has been publicizing a series of stock buybacks and reverse stock splits.. Shareholders say that with all the activity, they have no idea how many shares SpongeTech now has outstanding.

Metter declined to provide a number, or comment on speculation about the trading, but he vowed that neither he nor his fellow officers have sold a single share of the stock. The same holds true for RM Enterprises, he said.

SEC filings name Metter and his chief operating officer, Steven Moskowitz, as "control persons" and directors of RM Enterprises. But Metter denied to The Post that he is an RM Enterprises officer, saying it was Moskowitz's relationship.

SEC spokesman Kevin Callahan declined to comment, saying he cannot confirm or deny "the existence or non-existence" of any investigation.

Copyright 2009 NYP Holdings, Inc. All rights reserved.

Last edited by Saintjames; 09-17-2009 at 11:46 AM..
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Old 09-17-2009, 02:27 PM   Nav to Top  #249
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Default Carefully consider the facts only -- not rumors.

Remember the NY Post is *not* the NY Times. Additionally Timothy Sykes is not someone to be trusted or quoted as a source of any company. He is a shorter and a swing trader who spends little to no time investigating companies. He makes his money following trends and nothing more.

As far as what is happening at SPNG, I believe people are preparing now for the reverse split. I think in the next 4 trading days, you'll see this stock settle between .06 and .08 as the r/s is scheduled for 9/22. I expect a drop after the r/s as well.

This *will* settle and then the pps will rise. This company's financials are strong and this will be a great year for SpongTech, with NASDAQ listing in the future.

Having said all that, I've sold the majority of my shares at a loss to keep from losing more. I've only got 100k left in SPNG. But I *will* buy back in after the dust settles. I believe that will be after the r/s. I'm still watching it daily and ready to jump back in at any time.

I wish all SPNG investors the best. Do what is right by you and your money - not the company, a basher and most certainly not anyone on a discussion board.

Good luck..
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Old 09-17-2009, 03:39 PM   Nav to Top  #250
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I bought 990 of spng @ .132, it is dropping a ridiculous amount... should I sell it and cut my losses or is it worth the wait to see if it will shoot back up?
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