VANCOUVER, B.C. - TheNewswire - August 20, 2021 - Discovery One Investment Corporation (the “Corporation” or “DOIT”) (TSXV:DOIT.P). Further to the Corporation’s press releases dated October 6, December 2 and December 18, 2020, and March 10, April 9, April 23 and May 4, 2021, the Corporation wishes to update shareholders regarding its proposed acquisition of Pacific Frontier Investments Inc. (“PFI”) (the “Transaction”).  

 

On March 9, 2021, the Corporation, PFI and a newly incorporated subsidiary of the Corporation (“Newco”) entered into a definitive Amalgamation Agreement. Under the terms of the Amalgamation Agreement, the Corporation and PFI will complete a business combination by way of the amalgamation of PFI and Newco, whereby the Corporation will acquire all the common shares of PFI in exchange for common shares of the Corporation and the business of PFI will become the business of the Corporation.

 

On May 12, 2021, shareholders of PFI approved the Transaction, and on July 30, 2021, the Corporation received conditional acceptance by the TSX Venture Exchange (the “Exchange”) for the Transaction subject to DOIT meeting all the requirements of the Exchange.  The Corporation anticipates meeting all required conditions for final acceptance prior to September 30, 2021.

 

The Amalgamation Agreement has been amended to extend the time for completion to September 30, 2021, and provides that prior to closing, the shares of the Corporation will be consolidated on a 2.3:1 basis with shareholders of PFI to receive 0.452398 post-consolidated common share of the Corporation (the “Transaction Shares”) for every common share of PFI currently held.  Convertible securities of PFI will also be adjusted based on the foregoing exchange ratio.

 

As of the date hereof, the Corporation has 20,064,350 common shares outstanding (approximately 8,723,630 following the consolidation) and PFI has 104,139,954 common shares outstanding. As a result of the Transaction, the Corporation anticipates it will issue approximately 47,112,682 Transaction Shares to PFI’s current shareholders, and the Corporation upon completion of the Transaction (the “Resulting Issuer”) will have approximately 55,836,312 shares outstanding.  

 

In addition, Resulting Issuer shares will be reserved for issuance pursuant to the potential exercise or conversion of the following outstanding DOIT and PFI securities:

 

Currently outstanding DOIT or PFI security	Resulting Issuer shares reserved for issue and effective price after adjustment for consolidation and Transaction exchange ratio
2,000,000 DOIT stock options exercisable into DOIT share at $0.10 per share	869,565 stock options to acquire a Resulting Issuer share at an effective exercise price of $0.23 per share
2,500,000 PFI stock options exercisable into PFI share at $0.10 per share	1,130,994 stock options to acquire a Resulting Issuer share at an effective exercise price of $0.221 per share
$500,000 principal amount of PFI convertible notes exercisable into PFI shares at $0.07 per share	3,231,413 Resulting Issuer shares at an effective conversion price of $0.1547 per share
$1,340,000 principal amount of PFI convertible debentures exercisable into PFI units at $0.10 per unit (share and full warrant)	for underlying conversion unit shares: 6,062,130 Resulting Issuer shares at an effective conversion price of $0.221 per share
	for underlying conversion unit warrants: 6,062,130 Resulting Issuer shares at an effective exercise price of $0.3316 per share
3,759,600 PFI finder warrants exercisable into PFI share at $0.10 per share	1,700,835 warrants to acquire a Resulting Issuer share at an effective exercise price of $0.221 per share
681,000 PFI finder warrants exercisable into PFI share at $0.15 per share	308,083 warrants to acquire a Resulting Issuer share at an effective exercise price of $0.3316 per share

 

The Transaction Shares will be issued to the shareholders of PFI pursuant to exemptions from the registration and prospectus requirements of applicable securities laws. Upon completion of the Transaction: (i) all Resulting Issuer securities held by Principals (as such term is defined in the policies of the Exchange) of the Corporation and the Resulting Issuer will be subject to escrow in accordance with the policies of the Exchange; and (ii) all of the Transaction Shares held by non-Principals may be subject to resale restrictions under securities laws and the policies of the Exchange.

 

Immediately before the closing of the Transaction, the Corporation will change its name to “Pathfinder Ventures Inc.”. This name has been accepted by the B.C. Registrar of Companies and the Exchange.  

 

Upon completion of the Transaction, the parties anticipate that the Resulting Issuer will be listed as a Tier 2 Industrial Issuer on the Exchange and the Corporation has reserved the share ticker symbol “RV” with the Exchange for the Resulting Issuer.

Selected Pro Forma Financial Information

The following table sets forth unaudited pro forma financial information of DOIT as of January 31, 2021 and PFI as of March 31, 2021 after giving effect to the Transaction and should be read in conjunction with the pro forma financial statements, including the notes thereto, of the Resulting Issuer attached as a schedule to the Filing Statement (“Filing Statement”) to be filed on SEDAR prior to the completion of the Transaction.

	DOIT January 31, 2021	PFI March 31, 2021	Pro Forma Adjustments	Resulting Issuer Pro Forma *
Current Assets	$1,080,749	$2,265,225	$2,092,736	$5,438,710
Non-Current Assets	$0	$10,412,531	$0	$10,412,531
Total Assets	$1,080,749	$12,667,756	$2,092,736	$15,851,241
Current Liabilities	$4,266	$7,421,506	$(3,821,631)	$3,604,141
Total Liabilities	$4,266	$7,704,560	$2,100,000	$9,808,826
Shareholder’s Equity	$1,076,483	$4,973,196	$(7,264)	$6,042,415

 

*        Since March 31, 2021, PFI has continued to expend significant funds to complete the renovation, upgrade and expansion of the Agassiz and Parksville camp resorts, both of which re-opened in late-May and mid-July, respectively.  As at June 30, 2021, PFI had an estimated working capital deficit of approximately $1,468,000, prior to the receipt in July of $350,000 from an additional advance under a long term bank loan and the gross proceeds less commission of approximately $1,270,000 from its convertible debenture financing (see below).  PFI expects operational revenue to provide working capital to fund operating and G&A expenses for the balance of this operating season.

Selected Financial Information for Acquired Companies

 

In 2020, PFI completed the acquisition of three companies, 0596440 BC Ltd., Duckworth Management Ltd. and JAC Holdings Ltd.  These companies, respectively, owned an operating campground in Agassiz (the “Agassiz Campground”), the Metro Vancouver license to occupy and operate the municipal campground in the Brae Island Regional Park in Fort Langley (the “Fort Langley Campground”), and an operating campground in Parksville (the “Parksville Campground”).

 

Since acquisition, PFI has spent significant funds on the Agassiz Campground and Parksville Campground to renovate, upgrade and expand the operations to improve the facilities, modernize the infrastructure and utilities, and add additional RV/camp sites.  The following table sets forth select unaudited financial information for the three companies as at and for the periods stated (pre-acquisition) and should be read in conjunction with their respective financial statements, including the notes thereto, to be attached as schedules to the Filing Statement.

	0596440 BC Ltd. (Agassiz)	Duckworth Management Ltd. (Fort Langley)		JAC Holdings Ltd. (Parksville)
	FY Aug 31, 2020	FY Dec 31, 2019	9mo Sept 30, 2020	FY Mar 31, 2020	6mo Sept 30, 2020
Total revenues	131,667	1,607,540	1,582,155	444,264	394,585
Cost of Sales	-	341,882	550,593	-	--
Payroll Expense	43,358	545,252	276,969	26,007	--
Gross Margin	88,308	720,406	754,593	418,257	--
Expenses	74,406	463,288	524,859	190,908	121,375
Net income (loss)	13,903	267,023	259,578	227,349	248,103
Comprehensive income (loss)	12,715	251,009	259,578	200,246	248,103
Current assets	8,830	1,918,050	2,027,754	443,521	509,432
Total assets	171,626	2,478,370	2,523,221	1,856,151	1,924,818
Current liabilities	152,487	456,075	302,860	211,333	46,897
Total liabilities	152,487	792,102	577,375	211,333	46,897

 

PFI cautions that the above financial results may not be indicative of future operations.  As a result of the upgrades and expansion made at the Agassiz and Parksville properties, PFI expects to charge more per stay over a larger number of sites, as well as have improved winter revenues through an expanded operating season.

 

PFI Convertible Debenture Financing

 

In late July 2021, PFI completed a convertible debenture financing for gross proceeds of $1,340,000.  The convertible debentures mature in July 2023 and bear interest at 10% p.a. with accrued interest payable at 18 months and on maturity.  The principal amount of the convertible debentures may be converted into PFI units at a price of $0.10 per unit, with each unit being comprised of a PFI common share and a PFI warrant to purchase a further PFI common share at a price of $0.15.  Adjusted for the Transaction’s exchange ratio, the convertible debentures may be converted into an aggregate of 6,062,130 Resulting Issuer units at a price of $0.221 per unit, with each unit being comprised of a Resulting Issuer share and a Resulting Issuer warrant to purchase a further Resulting Issuer share at a price of $0.3316.  In conjunction with the financing, PFI has paid finder’s fees of $68,100 in cash and issued 681,000 finder’s warrants exercisable at $0.15 per PFI share (see above table for terms of Resulting Issuer equivalent security).  

 

About Pacific Frontier Investments

PFI is committed to take advantage of the business opportunities that exist given the growing trend of people looking to explore, reside and vacation in RV’s.  PFI is focused on building, through both acquisitions and new construction, a network of premier branded, upscale, and family-friendly RV parks and campgrounds under the “Pathfinder Camp Resorts” name.  PFI plans to aggressively expand its portfolio, while currently operating three Pathfinder Camp Resorts locations throughout British Columbia.

To date, PFI has acquired 3 operating RV/campground businesses located in Agassiz, Fort Langley, and Parksville.  PFI owns the Agassiz and Parksville sites, while the Fort Langley site is operated under a license granted by Metro Vancouver.  The Agassiz and Parksville locations underwent extensive renovations to improve and modernize their infrastructure and amenities and to increase their capacity.

Pathfinder Camp Resorts Agassiz opened in late May 2021 and has thirty-two new 50-amp “full hookup” RV sites and 8 fully renovated cabins with kitchens, flat screen TV’s and the latest modern comforts.  Updates to the property also include a new laundry facility, new restrooms, a brand-new west-coast themed playground for children, high speed Wi-Fi system and a renovated camp store and front desk check-in area. The swimming pool is planned to open in spring 2022. 

Pathfinder Camp Resorts Parksville opened in July with a fully renovated resort, two new playgrounds, a renovated swimming pool, new Camp Store & office.  The site offers 128 “Full Hookup” RV sites with a state-of-the-art Wi-Fi network throughout the park.  The water system was upgraded, and a new septic collection and treatment system was also installed.

The Fort Langley location has continued to provide a quality resort level experience consistent with the rest of the Pathfinder Camp Resorts brand.

Pathfinder Camp Resorts are seeing high occupancy rates and increasing demand from RV customers.  Since opening the Agassiz and Parksville locations, all three Camp Resorts have seen 100% occupancy rates on several weekends throughout the summer and above average occupancy rates throughout the weekdays.

Joe Bleackley, CEO and Founder of Pacific Frontier Investments and Pathfinder Camp Resorts says, “We have created a winning RV and Campground business model, where families are having great experiences and creating lifelong memories during their stay with us.  Customer feedback and occupancy rates prove our plan to be successful and we now need to aggressively replicate and expand by offering more locations to our growing RV customer base.”

General

Completion of the Transaction is subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval.  Where applicable, the Transaction cannot close until the required shareholder approval is obtained.  There can be no assurance that the Transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the filing statement to be prepared in connection with the Transaction, any information released or received with respect to the Transaction may not be accurate or complete and should not be relied upon.  Trading in the securities of a capital pool corporation should be considered highly speculative.

The Exchange has in no way passed upon the merits of the proposed transaction and has neither approved nor disapproved the contents of this press release.

On behalf of the board of directors of the Corporation:

Len Brownlie, Ph.D

President, Chief Executive Officer, and Director

For further information, please contact:

Discovery One Investment Corporation
Len Brownlie, Ph.D – President, Chief Executive Officer, and Director
Phone: (604) 649-5724

Email: firstsilver@hotmail.com

Pacific Frontier Investments Inc.

Joe Bleackley– Chief Executive Officer, and Director

Phone: (604) 914 2575

Email: ir@pacificfrontier.co

 

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Forward-Looking Information Cautionary Statement

This news release contains forward-looking statements relating to the timing and completion of the Transaction, the future operations of the Corporation and other statements that are not historical facts. Forward-looking statements are often identified by terms such as "will", "may", "should", "anticipate", "expects" and similar expressions. All statements other than statements of historical fact, included in this release, including, without limitation, statements regarding the Transaction and the future plans and objectives of the Corporation, are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Corporation's expectations include the failure to satisfy the conditions to completion of the Transaction set forth in the previous press releases of the Corporation concerning the Transaction and other risks detailed from time to time in the filings made by the Corporation with securities regulations.

The reader is cautioned that assumptions used in the preparation of any forward-looking information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted, as a result of numerous known and unknown risks, uncertainties, and other factors, many of which are beyond the control of the Corporation. As a result, the Corporation cannot guarantee that the Transaction will be completed on the terms and within the time disclosed herein or at all.  The reader is cautioned not to place undue reliance on any forward-looking information. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement. The forward-looking statements contained in this news release are made as of the date of this news release. Except as required by law, the Corporation does not undertake any obligation to update publicly or to revise any forward-looking statements that are contained or incorporated in this press release.

In the case of PFI, this news release includes certain "forward-looking statements" which are particular to PFI and are not comprised of historical facts. Forward-looking statements include estimates and statements that describe PFI’s future plans, objectives or goals, including words to the effect that PFI or its management expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as “believes”, “anticipates”, “expects”, “estimates”, “may”, “could”, “would”, “will”, or “plan”. Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to PFI, PFI provides no assurance that actual results will meet management’s expectations. Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward looking information in this news release includes, but is not limited to, PFI’s objectives, goals or future plans, statements, its projected revenues and earnings, and anticipated future growth in new markets. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, the ability of the PFI to successfully implement its development strategy and whether this will yield the expected benefits; competitive factors in PFI’s industry sector; the success or failure of product development programs; currently existing applicable laws and regulations or future applicable laws and regulations that may affect PFI’ s business; decisions of regulatory authorities and the timing thereof; Covid-19 related risks, availability of properties; the economic circumstances surrounding PFI’s business, including general economic conditions in Canada, the US and worldwide; changes in exchange rates; changes in the equity market; inflation; uncertainties relating to the availability and costs of financing needed in the future; and those other risks to be disclosed in the filing statement or other disclosure document to be prepared in connection with the Transaction.  Although PFI believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. PFI disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.