1. This company has $2.71M in current assets on Dec. '09. However, they have been losing $(3.957M), $(9.875M), and ($5.451M), respectively in '09, '08, and '07. At that rate, their current assets would be depleted before this calendar year is up assuming these conditions.
What could the company do to remain viable, besides declaring bankruptcy?
2. This company has always operated with HORRIBLE NET PROFIT MARGINS. In their first year, their net profit margins was around -110%. Regarding this, why and how did the company go public anyways?
3. For this IPO, which raised about $41.98M (I'm basing this on their volume of 33,055,000 X $1.27 share price on that day), I'm sure that the senior managers and other key players (i-bankers) all earned about $4M-$8M, I would guess.
This absolutely makes no sense to me why people would make a killing off of a money-losing venture like this. Please clarify.
4. What did the i-bankers and investors in this company have to gain when investing in this financially distressed company? My guess is that the C-level executives, seed investors, angel investors, and venture capitalists had an end-goal of going public, because they knew that they would make $4M-$8M in the IPO. At this point, their duties are fulfilled, and so was their compensation, and now, they don't really care what happens to the fortunes of the company since they're already wealthy.