Schmitt Provides Shareholder Value Opportunity Update, Announces Dutch Tender Offer
June 03 2020 - 8:00AM
Schmitt Industries, Inc. (NASDAQ: SMIT) (the “Company” or
“Schmitt”) today announced the completion of the evaluation of the
previously announced strategic opportunity. Following months of
discussion and analysis, the Company has decided that the
opportunity would not be in the best interest of its shareholders
and has ceased discussions.
The Company’s Board of Directors (the “Board”) has decided to
continue with its previously announced delisting from the NASDAQ
Stock Market and transition to listing on the OTC Markets. To
assist Company shareholders who do not want to own shares traded
over-the-counter, the Board has also approved a modified “Dutch
Auction” tender offer to purchase no less than $2 million of
Schmitt’s common stock at a price per share not less than $3.00 and
not greater than $3.25.
The Company intends to delist its common stock from the Nasdaq
Capital Market and deregister its common stock under the Securities
Exchange Act of 1934 promptly following the conclusion of the
tender offer.
The Board believes the tender offer will provide liquidity for
Company shareholders who wish to exit at a premium to the
three-month average closing price of the Company’s common stock
while minimizing transaction costs. The tender offer will be
subject to the terms and conditions set forth in an Offer to
Purchase and in a related Letter of Transmittal, which are expected
to be prepared and distributed to Company shareholders in
approximately 10 days.
Michael Zapata, Schmitt’s Chief Executive Officer and Chairman,
commented, “I believe our shares are undervalued, and the Board
understands shareholders may wish to exit prior to our delisting.
We are conducting this offer to provide liquidity for these
shareholders, and none of our officers or directors will tender
shares in this offer.”
Neither the Company nor the Board is making any recommendation
whether Company shareholders should tender or refrain from
tendering their shares to the Company. Schmitt is not making a
recommendation because it believes that its shareholders should
make their own decisions based on their views as to the value of
Schmitt’s shares and its prospects, as well as shareholders’
liquidity needs, investment objectives and other individual
considerations. Shareholders must decide whether to tender their
shares and, if so, how many shares to tender and at what price.
Shareholders should discuss whether to tender their shares with
their broker or other financial or tax advisors. Schmitt’s
directors and executive officers will NOT tender their currently
owned shares in the offer.
An Offer to Purchase, Letter of Transmittal and other documents
related to the tender offer will be mailed to Company shareholders
of record and will be available for distribution to beneficial
owners of shares upon commencement of the tender offer.
Shareholders are urged to carefully read such materials before
making any decision with respect to the tender offer.
THIS PRESS RELEASE IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT
AN OFFER TO BUY OR THE SOLICITATION OF AN OFFER TO SELL ANY SHARES
OF SCHMITT’S COMMON STOCK. COMMENCEMENT OF THE PROPOSED
TENDER OFFER IS SUBJECT TO, AMONG OTHER THINGS, COMPLETION OF ALL
REGULATORY FILINGS. ANY SOLICITATION OF OFFERS TO BUY
SCHMITT’S COMMON STOCK WILL ONLY BE MADE PURSUANT TO AN OFFER TO
PURCHASE AND RELATED MATERIALS TO BE SENT BY SCHMITT TO ITS
SHAREHOLDERS ON THE COMMENCEMENT OF THE PROPOSED TENDER
OFFER. SHAREHOLDERS SHOULD CAREFULLY READ THOSE MATERIALS
BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION, INCLUDING THE
VARIOUS TERMS AND CONDITIONS OF THE TENDER OFFER.
SHAREHOLDERS MAY OBTAIN COPIES OF THE OFFER TO PURCHASE, RELATED
MATERIALS AND OTHER DOCUMENTS ONCE FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION THROUGH THE COMMISSION'S WEB SITE AT
WWW.SEC.GOV WITHOUT CHARGE.
About Schmitt IndustriesSchmitt Industries,
Inc., founded in 1987, designs, manufactures and sells high
precision test and measurement products, solutions and services
through its Acuity® and Xact® product lines. Acuity provides laser
and white light sensor distance measurement and dimensional sizing
products, and our Xact line provides ultrasonic-based remote tank
monitoring products and related monitoring revenues for markets in
the Internet of Things environment.
Safe Harbor StatementThis document may contain
forward-looking statements made pursuant to the Private Securities
Litigation Reform Act of 1995. 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. A complete
discussion of the risks and uncertainties that may affect Schmitt’s
business, including the business of its subsidiary, is included in
“Risk Factors” in the Company’s most recent Annual Report on Form
10-K as filed by the Company with the Securities and Exchange
Commission.
Contact:Schmitt Industries, Inc.Michael R.
ZapataChief Executive Officer (503) 227-7908
Schmitt Industries (NASDAQ:SMIT)
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