Forbes & ManhattanI emailed Matt Simpson to get a better explanation of F&M. and our contract with them. He replied with what I think is a good explanation that clears the air somewhat:
Forbes & Manhattan is the founding company of Black Iron and provides shared services including shared legal resources, shared accounting resources, some shared technical people and shared office space. There are roughly 23 companies within the Forbes & Manhattan group that share such services. If Black Iron were to pay for a full time lawyer or the monthly rates charged by securities lawyers and similarly for a full time CFO, Accounts Payable person, etc. the costs would likely be much higher and/or lower quality people providing these essential support services. Additionally, some of the more senior Forbes & Manhattan people have very good commercial, political and financial relationships that can help with project development. For example, the founder of Forbes & Manhattan made the original introduction for Black Iron to the owner of Metinvest back in 2013 that led to an investment agreement for project construction over US$500 million; note that Black Iron subsequently bought back Metinvest’s ownership of the company.
The monthly cost for this service of C$25,000 has been included in each of the quarter financial statements plus the management discussion and analysis since the contract was put in place back in 2014. The Ontario Securities Commission requested that in addition to this quarterly disclosure that the actual contract be filed on SEDAR which has now been done. Hence, there is nothing underhanded it is merely ensuring full compliance with the highly regulated securities commission rules and regulations.
Regards,
Matt