- Schmitt Industries ( NASDAQ: SMIT ) said Wednesday it entered into a non-binding term sheet, which contemplates a reverse merger with Proton Green and spin-off of SMIT's Ample Hills business.
- Proton Green would become a wholly-owned unit of SMIT.
- The combined firm would be renamed Proton and the stock would continue trading on Nasdaq under a new ticker.
- Proton shareholders would receive SMIT shares in the merger in exchange for shares held in Proton.
- The deal would include a spin-off of SMIT's Ample Hills business to pre-merger SMIT shareholders.
- The contemplated deal would give SMIT investors exposure to helium, hydrogen and clean energy industries, while allowing Proton to fund strategic initiatives.
- SMIT expects shareholders of Proton and SMIT would hold ~95% and ~5%, respectively, of the combined firm.
- The ratio could be subject to proportional dilution for any financing in connection with the deal's closing. Dilution could be impacted by SMIT's intent to transfer $10M to its Ample Hills unit in connection with the spin-off.
- There can be no assurance that a merger will be entered into.
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Schmitt Industries announces non-binding term sheet with Proton Green