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I'm not sure of your numbers. If the market cap is 3-4m then using using your higher figure and the close price there would only be 59,701,492 shares outstanding.
Since the SEC says there's 3B shares outstanding which everybody was (rightfully claiming, except us longs, I never committed either way) then the market cap would actually be 3B x .0067 =$20,100,000.
The question now is how much are the assets that the SEC frozen worth and could they possibly have spent all the money they raked in issuing 2.25B (roughly) shares.
I'm still holding roughly 100,000 shares from my original purchases that started way back in Nov 08. I started accumulating @ .02 added @ .008 and sold as it rose to over .20. The remaining shares I consider bought and paid for as I reaped the profit I desired and held on to these as speculative.
The SEC has stated that they froze the accounts
1) preliminarily and permanently freeze the assets ofDefendants Spongetech,RM Enterprises, Metter, and Moskowitz to retain such assets for distributions to the victims of the scheme;
preliminarily and permanently bar Defendants Pensley and Halperin from providing professional services to any person or entity in connection with the offer or sale or securities, including but not limited to, participating in the preparation or issuance ofany attorney opinion letter related to such offerings; and
m) grant such other relief as this Court may deem just and proper.
The question being I would ask now is what are their assets worth and how would the SEC distribute it.
If they dumped 2.5B shares into the market it's reasonable to get a figure of what they sold them for? Of course some of them were given to pumpers and others, How many?
I guess the answer to why people are still trading it is betting on how many assets will be available.
Other questions to answer: What is the pecking order of to the assets. Lawsuits, shareholders etc.
How much of the cost of investigation is allowed if any to be taken.
Is it possible that somebody will purchase the rights to market and sell all of the products.
It's been fun to watch this long, guess it will be fun to watch for a while longer.
In the end will I see anything, probably not. As I said it doesn't matter to me at this point, it was Vegas Money for me, either I hit the jackpot or I didn't. Yes I know how much more money I'd still have had I sold it off long ago, but I got what I wanted and left the rest for fun.
I agree, It shouldn't be a long term solution. If they can't get a positive cash flow and increased sales the company is sunk. Again it comes down to product. Well management too and here's hoping product can survive poor management.
Now that is a million dollar Question :)
No doubt, it's just a matter of when it will come to an end, which it most certainly will one way or the other. My crystal ball is still in the shop for repairs.
I own a restaurant, I'm well versed in why retail operations accept CC's. The point has been well made that wholesale operators probably won't get paid by credit cards.
I agree that Not having to factor is better. My whole point though is when looking at in on a cost of money basis only the difference between CC's and factoring aren't that different.
The difference is we have grown to accept plastic as a way of life. The truth is, more companies will probably turn to factoring as Credit has tightened up in all areas in this economy.
So, I maintain. "when compared to credit cards the cost is much the same"
either way they have to raise prices. Cost of money is cost of money no matter where it comes from. We finally got to the basic point. I'll save my fingers from here on out...there's enough discussion for people reading to make their own decision!!!!
Have a happy, I'm sure I'm close to max posts.
That's just one company, which is what the company takes into account when deciding the % cost of the factoring. 1.5% overall bad debt is not unrealistic in any consumer business. If anybody has a better figure feel free to share. The point remains that all companies have bad debt and it's something to be considered along with the cost of factoring.
For the purpose of discussion it doesn't matter if they will or won't pay with credit cards, in both instances you are trading a percentage of the sale for quicker cash.
Good for you and the points. Of course you do realize that you are sharing the cost of those points with other consumers in higher product costs.
Another part of factoring that hasn't been discussed in regard to factoring is the reduction of bad debt that spng will have to write off. It reduces any cost of collection.
and my point is,the cost isn't significantly different than credit card expense. If all of spng customers paid them with credit card the cost wouldn't be much different. If factoring is bad then credit card acceptance has to be proportionately bad. What is the difference?
M
There is truth that factoring shifts the risk from SPNG to the buyers. Factoring means that the bank is trusting the ability of the buyers to pay as opposed to a line of credit where SPNG's ability to pay and credit rating counts. I get that point. I also know from my business that sometimes you do what you have to do.
Give me a Break Risicare, both are done to keep cash flowing. They both have similar costs and need to be looked at that way. Not everything is negative. Would it be nice to have the cash reserves to not do it....yes...is it the end of the world that they are doing it...no.
Spin it how you like, I'll spin it how I like. You won't change my mind and I won't change yours.
I'll stop posting my argument when you stop posting yours.
Yep it'd be nice if somebody would buy them out. I still can't figure the Pike angle, I'd hope that he was working on a leveraged buy out. There may actually come a point where even having the controlling interest from the Preferred shares won't do them any good if they can't generate profits. I don't think they can mass dump shares to generate more money.
I think at this point there's no pump that will push this over .06 there's too much publicity on the company. The only thing that will move it are facts and even M&M will have to make a decision at some point to either try to run it right and inform the shareholders or sell it for what they can get and go a different avenue.
Interesting point Christy, I'll give you credit, you really seem to keep your posts on point and accurate.
For me it's not a matter of trusting Mosky et. al. it's the point of watching the product and hoping something positive will come out in the end...how long to that end...I don't even fathom a guess.
LOL, I'm long and positive puppy and even I wasn't holding my breath on a 10K today.
But what you aren't answering is what makes it any worse than the 3% credit card fee?
I guess my point is, if what every negative thing that people are presuming is correct about SPNG, it really doesn't matter. The SEC knows the truth and will act accordingly, regardless of what SPNG does or said, either the accusations are correct or they aren't.
It doesn't mean they can't file. In fact it would behoove them to file even if it said they only did 10m in sales and 3B.
Either what they stated in updates is fact or fiction, nothing they do or say will change that. If it ain't fact then they have some serious 'splaining to do.
Why does everybody say they can't file the financials without getting in trouble with the SEC. I'm pretty sure that the SEC by now in their investigation has seen everything there is to see about SPNG including their financials, How else will they make a decision.
>>Thanks pantherj. The stuckholders in this company just don't get it. If you have a company that's borrowing money at interest rates of 57% per year, and is using those funds to manage a business with pretax margins of 20% per year, that's a negative arb.<<
LOL you make it sound like it's 37% more than their margins. If you compare it as a cost of sales it's 4%. Spin the numbers anyway you like but they turn over receipts of $100,000 and they get 96,000 in cash. How hard is that to understand. The only way it could be 57% APR is if they repeatedly paid 4% on the same $100,000.
12*100,000=1.2M
12*96,000=1.152m
total cost 48,000
The bottom line is you can't convert it to an APR. You can toss around all the calculations you want, but it still won't be 57%. The most realistic figure I saw was about 24% calculated by Christy from Google. I'm not sure I agree with her figure either, but her logic was much better than yours.
The last thing to remember is that no cost born by the business isn't passed on to the consumer. I play approximately 3% on every transaction I process in my restaurant. It's basically the same as paying somebody 3%. Since I do roughly 1000 credit card transactions per month, by your logic I'm paying 30% per month or a whopping 360% APR. I don't think so.
Am I absorbing that cost...nope, I raise the prices to cover it.
Count me as one. I'll hold mine for a lot longer, truth is it can go to .20 and I'm not sure I'd sell. Then again it could go to .001 and I wouldn't sell. I've reaped the rewards already and the remaining shares I have are gravy. Bottom line is I'll decide when and why I want to sell, and it won't be influenced by anybody providing speculative information on either side of the aisle.
Thanks Janice.
Thanks Risicare. I googled to see how others are listing it and most list it as otc otcbb or otcpk. Even this board lists it as OTC still.
I guess my main point was, it's petty to pick that out as a point of contention when there are more important issues to worry about with them.
My Zecco account still lists it as OTC and my TDA account lists them as Pink OTC markets. If it was such a big deal wouldn't those houses be facing liability for misrepresenting the stocks?
I don't know, much like most everything else about them...thanks for the info, I'm sure we'll see soon enough.
Perhaps because at the time the Post article was written it was OTCBB? I don't think that's going to get it kicked, either they have some evidence to support their claim or they don't. I'm not gonna waste my time either way. I'll patiently wait it out.
I guess there's about 3B shares worth according to some beliefs that must be as willing as me to hold and wait or the volume would be much much higher as everybody runs scared.
If there are 3B shares outstanding then those people are comfortable with the range it's trading at and happy to hold.
It's Bucs not Bucks. How should SPNG be listed. I did a google search and found it listed as OTC, OTCBB, OTCPK. I don't know if there's a designation for Grey sheet stocks, feel free to tell me what it should be. Can you tell me any other grey sheet stocks to look at for comparison?
They have been marketing it as "The Smarter Sponge TM" since june or july of last year. I'm sure if some other trademark thought it was infringed upon, they would have already done it.
I have no clue what you are saying
I'm long and I don't claim to know one way or the other. All I can do is look at indicators and decide.
I did find that the Buccaneers still show Spongetech as one of their sponsors for this season.
http://buccaneers.com/partners/pewterpartners.aspx
They market this area pretty strongly and their product is readily available in the Tampa Bay area as I have posted in previous posts.
Tavy
I can say with a pretty good certainty that you haven't tried the Pet Sponge or you would know that it works well. I have it and use it on both of my dogs. I bought it at a local Petsmart in Tampa Florida.
I like the Car sponge, however my only drawback on it is the Chamois that comes with it. Because of the wax in the sponge you have to buff a little more than I like, but it really does work. I actually use a shamwow instead so I'll only buy the sponge now. I also bought the sponge locally at Ace Hardware.
Some of my points were not correct, obviously the 4% APY, but the discussion has made the true cost known and a lot better in putting the $48,000 into perspective for those watching. I do look at it as a cost of sale. I have no doubt that like any other company, this will be passed on to the customers in any event. I'm not sure that it will price them out of the market and I still have confidence in the product if not the principles.
No different than offering a discount terms on payment.
BTW, My cost basis for my shares technically is about .028, but I sold off the majority of my shares when it was above .15 and kept some. In my mind they are free. I still won't sell them at .06, just so you know where I'm at.
LOL me either, I just picked a time period. It could be 5% 15 Net 30 the cost would be the same. Kind of the point I'm trying to make.
I know that it would be cheaper if they had a 1.2M line of credit and they borrowed 100,000 against it to support the sales. However many on the board are trying to call it 48%. I'll even accept your 24% as correct, not knowing the actual cash flow of their agreement.
The truth of the matter is that the way they are doing it is the same as offering a net discount. Pick your terms.
But the part your not acknowledging is the fact that he's generated 1.2M in sales at a cost of $48,000 over that years period. I understand your theoretical argument, however instead of being interest it is becoming a cost of sales. And that cost of sales is 4%.
Lets take the same effect in a different route.
If a company offers net less 5% for payment in 30 day and the buyer decides to pay in 60 for the full amount, what is the cost to the buyer over the course of a year for not taking the discount?
If they take the discount by paying the net less 5% in 30 days, how much has it cost the manufacturer.
Thanks, I like your explanation better. I tried to explain it in terms of sales generated...yours is much simpler and to the point.
Christy, that sounds correct but how can it be? Since they are paying $4000 per month then when the accounts receivables increases to $200000 the cost for factoring would have to be $8000 per month to make your figures work.
Actually OT is correct Christy. Factoring isn't as bad as people are trying to make it out to be. The fallacy of 48% being wrong I just disproved on another post. The rate is in fact 4% APR no matter how you want to spin it.
Factoring isn't that unsafe for the Banks taking it, it's just a secured method of making a loan. They are banking on the people owing on the invoices paying them as opposed to the company making the sales to pay the amount. The chances of being stiffed by collection of companies that bought product to being stiffed by one company distributing to those companies is significantly less.
In a nut shell if a company gets $960 for $1000 in invoices it's 4% period. They pay a one time free for the money. When they turn in another $1000 in invoices they get another $960 @ 4%. That doesn't add up to 8% since they have now recieved $1820 for $2000 worth of invoices. Still 4%.
Lets try to clear this mess up.
Using fictitious amounts of course since I have no idea what their recievables are, but the figures work no matter what they are.
Assume 100,000 per month avg in A/R each month. Then they will be charged $4,000 on that months receivables. The premise that they pay 48% would be correct if they recieved only $100,000 over the course of a year. The truth is they will actually receive $1.2M over the course of the year. Each set of receivables is a singular transaction, not an ongoing balance. So on $1.2 million in receivables in a year they would pay $48,000 in factoring costs. Tell me what percent that works out to.
Understand how it works. SPNG sends the invoices to whoever is factoring. They recieve 96% of the invoices. The Company providing the factoring receives the full amount of the invoices for carrying the invoices till paid. So they will receive $1.2 Million, the amount of the full invoices.
You can try to spin it anyway you want, but the bottom line is SPNG would have to borrow $100,000 in the first month and continue to pay $4000 per month on the same 100,000 over the rest of the year. Can't you understand that they will actually be turning $1.2 Million in sales over the year at a cost of $48,000.
The old saying is figures lie and liars figure. Sometimes you just have to take a common sense approach.
Wrinkles, that's my general feeling as well. The only shares I still hold were after I sold off a significant amount of shares last year at over .20 with a cost basis around .025. As far as I'm concerned my remaining shares are freebies, I pocketed what i wanted and speculated on the rest. They could go belly up and it wouldn't matter in the grand scheme of things. I'm not sure what price I would sell at.