Spongetech Delivery Systems, Inc. (fka SPNGQ)

[hoggey1]

Here's something about debt & creditors as it pertains to Spongebob: at the present time, SPNG has no senior secured debentures or any creditors holding senior secured debt.

To my knowledge SPNG has no LT debt. Therefore, there are no debentures or creditors, secured or otherwise. Potential judgments/awards from lawsuits don't count as any debt due, senior or otherwise, since no judgments, as yet, have been awarded against SPNG.

Since SPNG has no current debt, there are NO SENIOR SECURED DEBENTURES, nor any senior secured debt with which to force a bankruptcy liquidation. Claims made by plaintiffs against SPNG and/or M&M will likely take years to resolve.

LT Debt = ZERO, aka $0.00

http://www.google.com/finance?q=OTC:SPNG&fstype=ii

And those securities class actions may not be so black & white since neither the SEC nor DOJ have managed to collect much in the way of depositions from angry/pissed investor victims of Spongetech. In other words, if the FEDS don't have these investor/victims as witnesses, then the CA lawyers may not have the mojo to win much in the way of judgments against SPNG.

Also, consider that USXP actually won multimillion dollar judgments against naked short sellers, from juries, in state courts. Actually USXP won $700 million in judgments as noted by USXP receiver, Jane Moskowitz.

http://www.usxp.com/Receiver/Second_Report_Of_Receiver_11_09_07.pdf

From the USXP Receiver's Report:

"As noted in the Receiver's first report, the company received two judgments in Miami Dade Circuit court in 2001 and 2003, totaling with interest, approximately $700 million...In addition, the company has claimed that its success in claiming these judgments after a jury trial confirms its contention that it was the victim of naked short selling...

"The Receiver has sought to evaluate the collectability of these judgments. While the judgments are valid, and collection efforts ongoing, the company's characterization of them as substantially collectable does not appear to be correct.

"The amounts to be realized from these collection efforts, while not insignificant, are only a fraction of the $700 million awarded, and will not be sufficient to even cover the debts of the company."

$389 million jury award to Universal Express

http://findarticles.com/p/articles/mi_m0EIN/is_2001_July_26/ai_76772112/

"a jury in the circuit court Dade County Florida yesterday awarded USXP a damage verdict after trial of $389 million against Select Capital, Ronald G Williams and Walter S Koeller for fraud...and stock manipulation."

And the judge hasn't exactly been serving up prosecutor friendly judgments on any sort of judicial silver platter - of course that could change and start working against SpongeBob. But lately, it seems these judges have been more inclined to rule against the DOJ/SEC.

http://blogs.findlaw.com/courtside/2009/04/judges-bang-the-gavel-on-prosecutorial-misconduct.html

"In a series of savage benchslappings aimed at federal prosecutors, a growing group of district court judges is airing its displeasure with the trial tactics employed by the DOJ."

Considering UXSP won a multi HUNDRED million judgment from naked short sellers, it's very possible SPNG too can win their own judgment. The suit filed against Sykes, Patch, NYP, etc. and et al, got that ball rolling. IMO, it's clear that SPNG is the victim of a vicious NAKED short & distort campaign designed to destroy even the legit portion of this business. Of that there can be NO DOUBT.

And since its clear SPNG has nowhere near the "liabilities" of a USXP, and considerably more earning potential ----

Liquidation of SPNG = not likely.