Replies to post #216428 on Spongetech Delivery Systems, Inc. (fka SPNGQ)

[Jaboa]

SEC giving NSS some assistance here?

Not sure SEC is totally in our corner so far.

Here is what we know has happened this month.

1) Sometime between September 1st and September 11th Spongetech submitted their delayed 10K to the SEC.
2) Sept 11th the SEC rejected the 10K report stating SPNG needed to have 2008 10K numbers re-audited (not re-stated). The SEC had access to the 10K report which told them what the current OS of the company currently is.

Here is one possible scenario that would explain why this stock is in its current state of uncertainty while waiting on the 10K report rejected by the SEC.

** WHAT IF Spongetech had retired all RME shares and reduced the tradable OS to 100,000,000 shares or less? This scenario would appear possible based on the company PR stating that the company was going to buy back as much as 150,000,000 shares prior to September 5th. RME could be completely retired. (If the company had cash to buy Dicon and shares of Getfugu the buying back of RME shares would seem reasonable to assume).
** The SEC would know that this kind of 10K report would cause the stock price to jump considerably. Safe to say the new OS would easily justify a stock price in the $1 per share or more and would bring in institutional buying into the mix once the 10K report was official.
** This scenario could then be the trigger for a massive short squeeze on the stock as NSS tries to cover their positions once they could see that there was no going back.
** A squeeze on 2 billion + air shares would be something that has never occurred before.
** A squeeze of this magnitude could put market makers and brokerage houses at risk (not to mention the egg on the face of the SEC who allowed this to go on for as long as it has).
** A squeeze on a company on the REG SHO list could move the other 33 companies on the REQ SHO list to request investigations and tighter enforcement of the REG SHO list and could lead to more short squeezes down the road, further threatening the markets and further embarrassing the regulatory agencies.


It seems to me like the SEC bought some time (and lowered the price) for the NSS (after seeing the 10K) by requesting the 11th hour re-audit when the SEC could have notified sponge much sooner that all companies who worked with the suspended auditing firm would have to have their 2008 financials re-audited. They had to know that rejecting the 10K, when they did, would lead to the “E” being added to the Spongetech ticker symbol which would hurt the stock in the eye’s of investors.

Bottom line: The long stock holders are being left to twist in the wind (while major bashing assets ramp up to work on the stock price). I have not seen the SEC standing up for Spongetech just yet. I am hopeful that the 8K announcement on Friday is the start of SEC helping to solve this situation.

[janice shell]

What is the SEC going to do for SPNGE?

The question that should concern you is: What is the SEC going to do TO SPNG?