Spongetech Delivery Systems, Inc. (fka SPNGQ)

[Christy from Google]

They are paying 48,000 on the average OS AR balance. Assuming a 60 day AR Turnover, one gets the following:

Month #1 Sales 100,000 AR 100,000 cost 4,000
Month #2 Sales 100,000 AR 200,000 Cost 4,000
Month #3 Sales 100,000 Cash paid 100,000 AR 200,000 Cost 4,000
Month #4 Sales 100,000 Cash paid 100,000 AR 200,000 Cost4,000

and so on and so on

So its costing SPNG 48,000 per year to finance 200,000 in AR. I thinks thats 24%.

By calling it discount, its just a sneaky way of getting around various state banking rules. Tony S would be proud.

So the factoring Company is holding 200,000 in paper, and getting 48,000 on their investment. They are just middle men, because they are financing this with their own 200,000 7% credit line. Nice work if you can get it.