Pathfinder Signs Strategic Acquisition Agreement Adding RV & Self Storage Assets and Management Expertise
- Pathfinder signs LOI to acquire Black Sheep Income Corp. that owns and operates two RV & self-storage assets and is under contract to purchase two existing RV Resorts.
- Aggregate purchase price of $4.5 million.
- 80% paid in RV common shares, 20% deferred cash payment.
- Management addition of Mark O’Donoghue, CPA, CA as Chief Financial Offer.
- Management addition of Cathy Butler, CFA, as Chief Investment Officer and Board Member.
VANCOUVER, B.C., February 15, 2022 – Pathfinder Ventures Inc. (TSXV: RV) (the “Corporation,” “RV” or “Pathfinder.”) is pleased to announce that on February 10, 2022, it entered into a Letter of Intent (“LOI”) with Black Sheep Income Corp. (“BSIC”), a private B.C. company with RV and self-storage assets, to acquire all of the shares of BSIC for a combination of Pathfinder shares and cash. Upon completion of the acquisition, Mr. Mark O’Donoghue and Ms. Cathy Butler will join the Executive Management team and Ms. Butler, the Board of Directors.
Under the terms of the LOI, Pathfinder will acquire a 100% interest in BSIC, which wholly owns and operates one stabilized RV & self-storage business located in Penticton and one operating self-storage site with re-development potential in Nanaimo, B.C. Pathfinder will also acquire the contracts from BSIC to purchase two existing RV parks and campgrounds, one located in Columbia Valley along the Kooteney River of B.C. and the other along the North Saskatchewan River in the foothills of the Rocky Mountains of Alberta.
The options to acquire additional RV resorts and campgrounds substantially increases the Corporation’s pipeline of projects and could represent Pathfinder Camp Resorts’ expansion into Alberta, Canada.
Pathfinder shall acquire all the outstanding shares of BSIC for an aggregate purchase price of approximately $4.5 million, to be satisfied by way of 20% by payment in cash and the remaining proportion of 80% by issuance of Pathfinder common shares (the “Consideration Shares”) at an agreed deemed price of $0.20 per Pathfinder common share.
Subsequently, twenty percent (20%) of the Consideration Shares (the “Escrow Shares”) shall be subject to escrow until July 15, 2023 (the “Escrow Period”). In the event that the Pathfinder common shares trade or close on the Exchange at a price of $0.25 or more for 10 consecutive trading days (the “Escrow Trigger”) on or before the last day of the Escrow Period, the Escrow Shares will be returned to treasury and cancelled. In the event that the Escrow Trigger has not occurred on or before the last day of the Escrow Period, the Escrow Shares shall be released to the registered holders thereof. If the escrow cancellation is triggered and the common shares are returned to Pathfinder, the effective price per Consideration Share would be $0.25. BSIC also has $800,000 in convertible debentures outstanding which will be assumed by Pathfinder and become convertible with terms to be negotiated in the definitive agreement.
Joe Bleackley, Founder and CEO commented: “We are very excited to execute on our business strategy to expand into the RV and self-storage business, add RV resort and campground locations to our pipeline, and have two senior executives join the Pathfinder team. The continued growth in RV sales and outdoor recreation has led to an increase in demand for RV & boat storage locations, and high-density development planned in our target locations are contributing to demand for self-storage. We are really looking forward to the financial management and operational expertise that Mark and Cathy offer the Pathfinder team and we look forward to this additional leadership to continue to fuel the growth of Pathfinder Ventures.”
Executive Management and Board of Directors Strengthened
The founders and management of BSIC, Cathy Butler, CFA, and Mark O’Donoghue, CPA, CA, will join the Pathfinder executive team as Chief Investment Officer and Chief Financial Officer respectively, and Cathy Butler will be appointed to Pathfinder’s Board of Directors.
Mark O’Donoghue, CPA, CA: Chief Financial Officer
Co-founder, President and CFO of Black Sheep Income Corp., Mark acts as Trustee, Director and CEO of the Azcan US Residential Real Estate Trust which invests in a unique niche in Georgia real estate. Mark was the President and CFO of Azcan RPG Corp, which acquired Arizona real estate after the housing crash in 2009 then, renovated and sold over 350 properties in the US. Mark‘s responsibilities included the capital raises, financial reporting and business strategy. Earlier in his career, Mark was the co-founder, CEO and CFO of an Investment Advisory Firm in the Turks and Caicos Islands with over $300 million in assets under administration. Following that Mark also excelled as a Business and Leadership Coach consulting to entrepreneurial clients and large corporate executive clients including NAL Resources and Nexen Inc.
Cathy Butler, CFA: Chief Investment Officer and Board Member
Co-founder of Black Sheep Income Corp, Cathy acquired land, developed & operated storage facilities in her career that ranged from a $34 million un-developed storage portfolio including sites in Windermere and Sherwood Park, that sold to Real Storage (now Storage Vault), a 9-acre greenfield development that sold to Storage Vault, a 5-acre greenfield development that sold to Real Storage (now Storage Vault), and a site in Okotoks and Calgary that she sold to StorageMart. Cathy is also the co-founder of Beltline Brownstones Inc. which owns & operates multi-family properties, and earlier in her career Cathy founded Natural Borders Reforestation, which grew to merge with New Forest Contractors, later acquired by Fairfax Financial. Cathy has been registered as an Alberta Securities Commission portfolio manager and has held private equity research analyst and business development positions with The Blackstone Group, Avenir Capital, and Wilmington Capital.
Darren Prins, CPA CA, plans to resign as the Chief Financial Officer for the Corporation upon closing of the acquisition. “It’s been a pleasure working with the entire team since the founding of the company, going through the RTO process and building the foundation of the financial reporting department. With the growth trajectory ahead, it’s great to see Pathfinder having reached the stage of needing a full-time CFO.” says Darren Prins.
Black Sheep Income Corp Asset Highlights
Penticton RV & Self-Storage Site
BSIC acquired the Penticton site in 2020 and has operated it since, consistently improving revenues and net operating income from its initial run rate at acquisition. BSIC was attracted to the specialized container-based storage model due to the reduced capital cost versus traditional storage and the flexibility the containers provide in that they can be deconstructed, flat packed and shipped to different sites allowing BSIC to maximise flexibility for both demand among its sites and management of the land. BSIC owns the 1.86 acres of industrial zoned land the facility operates from.
Nanaimo, B.C. RV and Self-Storage Site
In 2021 BSIC acquired the operating RV and self-storage location in Nanaimo and plans to develop and intensify the operations. The property is 2.4 acres of industrial zoned land along the Trans-Canada Highway in the South end of Nanaimo, poised to benefit from the expansion of the Duke Point shipping terminal and the significant residential expansion in the area.
Closing of the Transaction
The completion of the acquisition remains subject to the satisfaction of condition precedents, including but not limited to the receipt of Exchange approval and of any other required regulatory, shareholder and third-party approvals. There are no finder’s fees to be paid in connection with closing the transaction, and the acquisition is an Arm’s Length Transaction under the policies of the TSX Venture Exchange.
About Pathfinder Ventures
Pathfinder Ventures Inc. is developing a network of premier branded, upscale and family-friendly RV parks and campgrounds under the “Pathfinder Camp Resorts” name. Pathfinder currently has three camp resorts located in B.C. and is focused on growing its network through both acquisitions and new construction. The Corporation is taking advantage of the rapidly growing market of Canadians who want to experience the great outdoors in an RV.
On behalf of the board of directors of the Corporation:
Chief Executive Officer, Founder and Director
Pathfinder Ventures Inc.
Investor Relations Contact:
Simone Capital Corp.
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.
This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”) or any state securities laws and may not be offered or sold within the United States or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.
Forward-Looking Information Cautionary Statement
This news release contains forward-looking statements relating to 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 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 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. 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 RV, this news release includes certain “forward-looking statements” which are particular to RV and are not comprised of historical facts. Forward-looking statements include estimates and statements that describe RV’s future plans, objectives or goals, including words to the effect that RV 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 RV, RV 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, RV’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 RV to successfully implement its development strategy and whether this will yield the expected benefits; competitive factors in RV’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 RV’ s business; decisions of regulatory authorities and the timing thereof; Covid-19 related risks, availability of properties; the economic circumstances surrounding RV’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 disclosed in the filing statement or other disclosure document prepared and supplied on sedar. Although RV 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. RV 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.