Wednesday, March 04, 2009

(SPNG.ob) - SpongeTech Delivers Positive Shareholders Update

GENEVA, March 5 /PRNewswire-FirstCall/ -- SpongeTech® Delivery Systems, Inc. America's Cleaning Company(TM), (OTC Bulletin Board: SPNG - News).

To my fellow shareholders of SpongeTech®:

Despite what many consider today's environment to be a worldwide economic slowdown, the sales momentum of SpongeTech®'s products has continued to remain strong. We anticipate meeting or exceeding our previously announced projected revenues and earnings for the current fiscal year ending May 31, 2009.

Our third quarter ended February 28, 2009 and we expect to file our Form 10-Q with the SEC by April 15, 2009. We last updated the Company's capital structure to you on February 2, 2009 and at that time we had approximately 700,000,000 issued and outstanding shares of which RM Enterprises held approximately 480,000,000 shares. These shares held by RM Enterprises are (R144) restricted common shares of stock which legally can be bought back by only the Company itself. We have and will continue to retire as needed the remaining restricted shares held by RM Enterprises.

We are proud to announce that our Company is now cash flow positive and can finance our immediate growth from the cash generated within. We have been in negotiation with two banking institutions that could potentially provide us with accounts receivable financing, if and when needed for the future growth of our Company. However we hope that future cash requirements for product development, marketing, production, and financing of inventories and receivables can and will be generated internally.

SpongeTech®'s Products Update

Pet Care

We recently launched our "Uncle Norman's Pet Sponge" at the Westminster Kennel Club's 33rd annual Dog Show at Madison Square Garden in New York City and received a good response from the public, distributors and retailers. Our national marketing campaign and infomercials continue to generate growing sales and repeat orders online. We expect to add additional new products to our Pet Care line in the coming months.

Auto Care

With spring season around the corner, we are happy to announce that our automotive cleaning products are now available in many retail outlets in the US and overseas. We recently sponsored and placed our name on NASCAR #78, driven by Regan Smith in this year's Daytona 500 race. The Daytona 500 was a premier event viewed by tens of millions of fans worldwide and we anticipate having additional marketing exposure with NASCAR throughout the racing season.

Children's Bath

We recently licensed with Viacom's Nickelodeon subsidiary creating the products and packaging for children's bath sponges in the likenesses of Nickelodeon characters SpongeBob Square Pants, Dora the Explorer and Go Diego Go. These products will be available in major retail outlets that carry other Nickelodeon licensed products such as Wal-Mart. Our marketing research leads us to believe that the bath products will be very popular among children and their parents at price points which are affordable.

Household Cleaning

Our Company has developed two distinct lines of product for the home cleaning market, Kitchen and Bath.

1) Kitchen - Designed for kitchen use infused with antibacterial soap or detergent.

2) Bath - Designed for the bathroom to clean ceramic tile, porcelain and plastic surface.

The Household products market is very competitive and expensive to enter, therefore we are seeking for the right partner with established brand recognition and dedicated retail shelf space. We have already designed and tested our product for a major company. To date, both parties are pleased with the product line and its test market acceptance.

Healthcare and Cosmetics

Our Company has developed and tested a derma-sponge which may be used as an applicator for sun block and other skin care products. Discussions are underway with a market leader in the sun lotions and sun block preparations industry.

Your Management Team is pleased with the recent progress in the development, marketing, and distribution of SpongeTech®'s products and I trust that you are also favorably impressed by the Company's recent growth and operating results. We appreciate your patience and your loyalty and let me assure you, that we will continue to put our best foot forward building a company, a globally recognized brand, and continue to show revenue and profit to which our shareholders can be proud of and which should be reflected and rewarded by a healthier performance of the stock.

Very truly yours,

Steven Y. Moskowitz

Chief Operating Officer

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