Schmitt Industries, Inc. Announces that ISS and Glass Lewis Both Recommend that SMIT Shareholders DO NOT VOTE FOR SENTENTIA N...
October 02 2018 - 2:15PM
Schmitt Industries, Inc. (NASDAQ: SMIT) (“
SMIT”)
today announced that Institutional Shareholders Services Inc. and
Glass Lewis, the leading independent proxy research and advisory
firms to institutional investors, have both recommended that SMIT
shareholders do not vote for Sententia’s nominees.
SMIT also announced that today it sent a letter to its
shareholders. Included below is the full text of the letter:
Leading proxy advisory firms recommend DO
NOT VOTE FOR SENTENTIA Nominees
October 2, 2018
Dear Fellow Shareholders,
Schmitt Industries, Inc. (“SMIT” or the
“Company”) today announced that Institutional
Shareholders Services Inc. (“ISS”) and Glass
Lewis, the leading independent proxy research and advisory firms to
institutional investors, both recommend that SMIT shareholders do
not vote for Sententia’s nominees. After thoroughly
evaluating SMIT’s performance, Sententia’s arguments, and their
nominees, BOTH ISS AND GLASS LEWIS have recommended that
shareholders do not vote for the Blue card nominees.
ISS and Glass Lewis are both completely independent – they have
no relationship with SMIT and no stake in our proxy
contest.
According to ISS and Glass Lewis (emphasis added):
SMIT’s FY2017 Strategy is working |
ISS: “The board [of Schmitt Industries] implemented a
turnaround effort in FY2017 that has been directionally positive
thus far.” |
SMIT’s FY2017 Strategy has proven results |
Glass Lewis: “[Glass Lewis] believe[s] the Company’s strong
FY2018 results…lend credibility to the incumbent board’s
argument that the incumbent board and management have the
right strategy to position the Company for future success and to
enhance shareholder value.” ISS: “The strategy has been
directionally positive thus far, as revenues reached a
five-year high in FY2018, while gross margin
increased, operational expenses declined,
and net income was positive for the first time since
FY2012.” |
Sententia’s plan will not work |
Glass Lewis: “…[Glass Lewis is] somewhat concerned that the
Dissident has not presented a detailed plan to improve
operations and [Glass Lewis] recognize[s] that the
Company has already taken steps to cut costs and improve
efficiency.” ISS: “…[Sententia] has failed to
convincingly articulate an understanding of the fundamental drivers
of underperformance that necessitated the turnaround
strategy and the manner in which its nominees would
contribute to the efforts.” |
ISS and Glass Lewis recognize that SMIT has articulated a clear
and proactive strategy that has been successful. Based on
these conclusions, the proxy advisory firms recommend the
following:
- ISS and Glass Lewis recommend that shareholders vote
the Company’s WHITE Proxy Card for David Case.
- ISS and Glass Lewis recommend shareholders DO NOT VOTE
the Blue proxy card and DO NOT VOTE for Sententia’s
nominees.
As stated in CEO David Case’s letter to fellow shareholders
mailed to you with the 2018 Annual Report, it is the Company’s
objective to improve our shareholder communications and
transparency to the market. We look forward to continuing the more
robust communication we have established with shareholders both at
the Annual Meeting on October 12th and into the fiscal year
ahead.
VOTE THE ENCLOSED WHITE CARD
TODAY!
The cut off time for voting is approaching, and your vote is
critical this year. The online voting cut off is 11:59 PM
Eastern on October 11, 2018.
If you have already voted for Sententia’s nominees on the Blue
proxy card, you can still change your vote to the Company’s
nominees. You can place your vote by using the
mailed WHITE Proxy Card enclosed with
this letter.
If you have any questions or would like us to contact you,
please do not hesitate to reach out to our proxy solicitor,
Alliance Advisors,
at (833) 786-6483.
Again, thank you for your continued support.
Michael J. Ellsworth
Chairman of the Board of DirectorsSchmitt Industries, Inc.
Additional Information
In connection with its 2018 Annual Meeting of
Shareholders (the “Annual Meeting”), Schmitt Industries, Inc. (the
“Company”) has filed a definitive proxy statement dated September
14, 2018 (the “Proxy Statement”) and other documents related to the
Annual Meeting with the Securities and Exchange Commission (“SEC”)
on Schedule 14A and is mailing its Proxy Statement and a proxy card
to each shareholder entitled to vote at the Annual
Meeting.
Participants in Solicitation
The Company and its directors and executive officers may
be deemed to be participants in the solicitation of proxies in
connection with the Annual Meeting. Information regarding the
Company’s participants is set forth in the Proxy
Statement.
Forward-Looking Statements
Certain statements in this presentation are
“forward-looking statements.” These statements are based upon
current expectations, estimates and projections about the Company’s
business that are based, in part, on assumptions made by
management. These statements are not guarantees of future
performance and involve risks and uncertainties that are difficult
to predict. Actual outcomes and results may differ materially from
what is expressed or forecasted in such forward-looking statements
due to numerous factors, including, but not limited to, general
economic conditions and global financial concerns, the volatility
of the Company’s primary markets, efforts to accelerate growth in
sales of the Xact® tank monitoring systems and the ability to
satisfy expected demand, the ability to develop new products to
satisfy changes in consumer demands, the intensity of competition,
the effect on production time and overall costs of products if any
of our primary suppliers are lost or if a primary supplier
increases the prices of raw materials or components, the ability to
ramp up manufacturing to satisfy increasing demand, maintenance of
a significant investment in inventories in anticipation of future
sales, existing cash levels which may not be sufficient to fund
future growth, the ability to obtain financing if needed to fund
operations or growth through commercial loans or capital fund
raising at terms acceptable to the Company and its shareholders,
fluctuations in quarterly and annual operating results, attracting
and retaining key management and qualified technical and sales
personnel, changes in effective tax rates, the ability to reduce
operating costs if sales decline, increased costs due to changes in
securities laws and regulations, protection of intellectual
property rights, and risks from international sales and currency
fluctuations.
For further information regarding risks and
uncertainties associated with the Company’s business, please refer
to the Company’s SEC filings, including, but not limited to, its
Forms 10-K, 10-Q and 8-K.
The forward-looking statements in this presentation
speak only as of the date on which they were made, and the Company
does not undertake any obligation to update any forward-looking
statement to reflect events or circumstances after the date of this
presentation, or for changes to this document made by wire services
or internet service providers.
CORPORATE OFFICE:2765 NW NICOLAI ST. ●
PORTLAND, OREGON 97210 ● 503/227-7908 ●
FAX 503/223-1258
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