Ah, you can hear he flurry of activity in the background. All will be revealed shortly. In the meantime, let's go back to how JKP was run before it's IPO.
Bob Friedland runs a shell corporation called Matzuda. When he was still dating employees he had 50 years on, Matzuda was essentially acting as the liquid cash for financing JKP's operations, incurring considerable debt. Many of those debts were later converted into stock options held not by Matzuda but a trust fund in Bob's name.
What sort of operating expenses did JKP incur for Matzuda? That's buried in the prospectus:
Quote:
From January 1, 2001 to April 30, 2003, we paid Matzuda Corporation $5,000 a month as rental payments on the office space that we rented for our operations.
JKP was later paying less than this--approximately $4,000 and change--for an entire floor of a building they were renting. It doesn't end there, though. Bob was also paying his company--he was CEO, remember--a "consulting fee":
Quote:
From January 1, 2001 to July 31, 2003, we paid Matzuda Corporation consulting fees in the amount of $37,500 per month in connection with film production consulting services it provided to us.
I'm curious what "film production consulting services" Bob provided to Bob. Did Bob say "Hey, Bob, how about more blondes in JKP videos?" Or did he say, "Hmm, Shyla... that's a girl you should hire, marry, and then annul." Whatever advice was given by Bob to Bob, it was certainly well rewarded. 
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