Proton Green, LLC entered into a non-binding term sheet to acquire Schmitt Industries, Inc. (NasdaqCM:SMIT) in a reverse merger transaction on July 20, 2022. The Term Sheet contemplates the execution of a merger agreement whereby the security holders of Proton Green would receive Schmitt securities in the Merger, in exchange for securities held in Proton Green. In addition, the Term Sheet contemplates the Spin-Off of SchmittÆs Ample Hills business to the pre-Merger shareholders of SchmittÆs common stock subsequent to the closing of the anticipated Merger. Based on the initial valuations (without adjustment), Schmitt anticipates that the security holders of Proton Green and Schmitt would hold approximately 95% and 5%, respectively, of the combined company. The combined entity would be renamed ôProton Green Corporationö and the common stock would continue to trade on the Nasdaq under a new symbol.
Completion of the Merger is subject to the negotiation of a definitive Merger Agreement and related documentation, approval of the Merger and issuance of shares related to the Merger by SchmittÆs Board of Directors and shareholders, approval of the continued listing by Nasdaq of Schmitt common stock on the Nasdaq Capital Market on a post-Merger basis (which is anticipated to require raising additional financing in connection with the closing of the Merger), the completion of due diligence to the satisfaction of the parties, financing and satisfaction of other conditions that are to be negotiated as part of the Merger Agreement.