SUBJECT TO COMPLETION, DATED NOVEMBER 21, 2017
SCHMITT INDUSTRIES, INC.
Nontransferable Subscription Rights to Purchase up to 998,636 Shares of Common Stock at $[*] per Share
We are distributing, at no charge, to holders of our outstanding Common Stock, nontransferable subscription rights to purchase in the aggregate up to [*] shares
of our Common Stock, no par value, which we refer to as Common Stock, at a cash subscription price of $[*] per share for maximum gross proceeds of $[*]. We refer to the offering of our Common Stock through the subscription rights as the
rights offering. You will receive one subscription right for each share of Common Stock you own. Each subscription right will entitle the holder to purchase
one-third
of a share of our Common Stock
at a subscription price of $[*] per whole share, which we refer to as the basic subscription right. We will not issue fractional shares in the rights offering. If the number of subscription rights you exercise would otherwise permit you
to purchase a fraction of a share, the number of shares you may purchase will be rounded down to the nearest whole share.
If you exercise your basic
subscription rights in full (other than those subscription rights to acquire less than one whole share of Common Stock, which cannot be exercised) and other shareholders do not fully exercise their basic subscription rights, you may also exercise an
over-subscription right to purchase, at the same subscription price, some or all of the additional shares of Common Stock that remain unsubscribed at the expiration of the rights offering, subject to availability and pro rata allocation of shares
among persons exercising this oversubscription privilege. You will not be entitled to receive any rights unless you hold shares of our Common Stock as of the record date, which is 5:00 p.m. Eastern Time, on November 27, 2017.
If all of the basic subscription rights are exercised, the total purchase price of the shares offered in the rights offering will be approximately $[*]. We are
not requiring a minimum subscription to complete the rights offering. However, we reserve the right to cancel the rights offering for any reason at any time before the rights offering expires. If we cancel the rights offering, all subscription
payments received will be returned as soon as practicable, without interest or penalty,
The subscription rights may be exercised at any time beginning
on the effective date of this prospectus and before the expiration of the rights offering, which will be [*] days after the effective date or [*], 2017, at 5:00 p.m., Eastern Time, unless we extend the rights offering period. We reserve the right to
extend the rights offering period in our sole discretion.
Broadridge Corporate Issuer Solutions, Inc. will serve as the Subscription Agent for the
rights offering. The Subscription Agent will hold in escrow the funds we receive from subscribers until we complete, abandon, or terminate the rights offering. If you want to participate in the rights offering and you are the record holder of your
shares, we recommend that you submit your subscription documents to the Subscription Agent before the deadline. If you want to participate in the rights offering and you hold shares through your broker, dealer, bank or other nominee, you should
promptly contact your broker, dealer, bank or other nominee and submit your subscription documents in accordance with the instructions and within the time period provided by your broker, dealer, bank or other nominee. For a detailed discussion, see
the section entitled The Rights Offering The Subscription Rights.
The subscription rights and the shares of Common Stock
issuable on their exercise, both of which are covered by this Registration Statement, are being offered directly by us without the services of an underwriter or selling agent. We will bear all costs, expenses and fees in connection with the
registration of such securities.
Our Common Stock is traded on the Nasdaq Capital Market under the symbol SMIT. On [*], 2017, the last reported
sales price for our Common Stock was $[*] per share.
Representatives of the Teton Westwood Mighty Mites Fund (the Fund), a current shareholder
of the Company, have informed us that the Fund intends to exercise its basic subscription rights in full and its over-subscription rights up to the remaining full amount of the offering. However, neither our Board of Directors nor our management has
made any recommendations regarding whether you should exercise your subscription rights. You should carefully consider whether to exercise your subscription rights before the expiration of the rights offering based on your own assessment of your
best interests. You may not revoke or revise any exercises of subscription rights once made, unless we terminate the rights offering.
You should read this
prospectus and any information incorporated by reference herein carefully before you invest.
Investing in our Common
Stock involves a high degree of risk. You should review carefully the risks and uncertainties described in the section entitled
Risk Factors
contained on page 15 of this prospectus as well as any other risk
factors and other information contained in any other document that is incorporated by reference herein or therein.
Neither the Securities and
Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is [*], 2017.