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Proposed all-stock transaction aims to align JEV's scalable energy platform with Smartkem's semiconductor innovations to power next generation AI data centers
TULSA, OK AND MANCHESTER, UK, PA / ACCESS Newswire / October 7, 2025 / Jericho Energy Ventures Inc. (TSXV:JEV)(OTC:JROOF)(FRA:JLM) ("Jericho" or "JEV"), an energy innovation company, today announced that it has signed a non-binding Letter of Intent ("LOI"), dated October 6, 2025, with Smartkem, Inc. (NASDAQ:SMTK), ("Smartkem"), a company developing a new class of organic semiconductor technology, for a proposed all-stock business combination (the "Proposed Transaction"). If completed, the Proposed Transaction would establish a U.S.-owned and controlled AI infrastructure company, integrating low-cost domestic energy with advanced semiconductor packaging and materials to support the surging demand for AI compute capacity.
AI Infrastructure at the Core
JEV is positioned at the intersection of energy and AI, leveraging its high-capacity energy framework and renewable innovation to provide resilient, low-cost power for AI data centers. The contemplated transaction would integrate Smartkem's patented organic semiconductor platform into Jericho's infrastructure to accelerate:
Energy-efficient AI data centers engineered for next-generation workloads
Advanced AI chip packaging that reduces power consumption and heat
Low-power optical data transmission to enable faster interconnects
Conformable sensors for environmental monitoring and operational resilience
Terms of the Proposed Transaction
Under the LOI, the Proposed Transaction would be structured as an all-stock business combination, effected through either a share exchange or statutory merger, pursuant to which Smartkem would be the surviving legal entity and would continue as a publicly listed company on The Nasdaq Stock Market ("Nasdaq") (such surviving company, the "Combined Company"). Upon the closing of the Proposed Transaction, Jericho stockholders would own 65% and Smartkem stockholders prior to the Proposed Transaction would own 35% of the fully diluted issued and outstanding equity securities of the Combined Company, subject to adjustment in certain circumstances.
Brian Williamson, the current chief executive officer of Jericho, would become the chief executive officer of the Combined Company, and the board of directors of the Combined Company would be reconstituted to include a majority of members designated by Jericho, subject to compliance with applicable requirements of Nasdaq and the Securities and Exchange Commission.
The LOI is non-binding, and there can be no assurance that Smartkem and Jericho will ultimately enter into a definitive agreement for the Proposed Transaction, that the Proposed Transaction will be consummated, or as to the timing or ultimate terms of any Proposed Transaction that may occur. Both Smartkem and Jericho will need significant additional capital to complete the negotiation of the Proposed Transaction, obtain any required stockholder approvals and ultimately complete the Proposed Transaction. The closing of the Proposed Transaction would be subject to significant closing conditions, including the negotiation of the definitive agreement, the satisfactory completion of due diligence, required board and stockholder approvals, and approval of continued listing by Nasdaq.
In the LOI, Smartkem and Jericho have agreed to a 60-day exclusivity period to negotiate the terms of a definitive agreement, which exclusivity period is terminable by either party under certain circumstances including, in the case of Jericho, if Smartkem does not purchase Jericho common shares having a value of at least US$500,000 on or prior to November 30, 2025. So long as the LOI is still in effect, upon the earlier of (i) Smartkem's chief financial officer's good faith determination that Smartkem has regained compliance with Nasdaq's minimum stockholders' equity requirement and (ii) Smartkem's issuance of securities (including upon exercise of outstanding convertible securities) for aggregate gross proceeds of not less than $5,000,000, Smartkem will purchase from treasury Jericho common shares in an amount equal to the greater of (a) $500,000 and (b) 10% of the gross proceeds of such issuances, subject to a cap of $1,000,000. There can be no assurance that the circumstances necessary for Smartkem to satisfy the requirements for completion of the investment will occur.
The transaction terms set forth in the LOI are expected to be replaced by a definitive agreement (the "Definitive Agreement"). Completion of the proposed transaction remains subject to regulatory approvals, including approval by the TSX Venture Exchange ("TSXV"), as well as customary closing conditions. These include approval of the merger by the boards of directors of both JEV and Smartkem, approval by Jericho shareholders, and the completion of satisfactory due diligence by each party. The final legal structure of the merger may be modified following further review of applicable tax, corporate, securities, and accounting considerations.
JEV is also pleased to announce that Markus Seywerd, a Director of the Company, has been appointed as Corporate Secretary, effective October 1, 2025.
Jericho further announces that it has granted incentive stock options to certain directors, officers, employees, and consultants to purchase an aggregate of 4,300,000 common shares of JEV at an exercise price of $0.15 per share. Of these, 3,800,000 options were granted to directors and officers and are exercisable for a period of five years from the date of grant. The remaining 500,000 options were granted to the Company's manager of investor relations, are exercisable for a period of three years from the date of grant and will vest in equal quarterly instalments of 25% over a 12-month period. All stock options are subject to the terms and conditions of Jericho's stock option plan and remain subject to acceptance by the TSX Venture Exchange.
