EX-4.2





 EXHIBIT 4.2 

SCHMITT INDUSTRIES, INC. 
 2765 N.W. Nicolai Street

 Portland, Oregon 97210-1818 
 [●], 2017

 Dear Shareholder: 
 Enclosed is the Prospectus dated
[●], 2017, and other materials relating to the rights offering (the “Rights Offering”) by SCHMITT INDUSTRIES, INC. (the “Company”) to the holders of record of its common stock, no par value (the “Common Stock”,
such record holders of the Company’s Common Stock, the “Record Holders”). Record Holders as of [●], 2017 (the “Record Date”) will receive at no charge non-transferable
subscription rights (the “Subscription Rights”) to purchase up to an aggregate of [●] shares of Common Stock (the “Shares”) at a subscription price of $[●] per Share (the “Subscription Price”) for up to
aggregate gross proceeds to the Company of approximately $[●] million. Each Record Holder will receive a Subscription Right for each share of the Common Stock that such Record Holder owned on the Record Date. Each Subscription Right will
entitle the Record Holder to purchase one-third of a Share at the Subscription Price (the “Basic Subscription Privilege”). 

Please carefully review the Prospectus and other materials and the instructions below, which describe how you can participate in the Rights Offering. You will
be able to exercise your Subscription Rights to purchase additional shares of the Company’s Common Stock only during a limited period. You will find answers to some frequently asked questions about the Rights Offering in the Prospectus. The
exercise of Subscription Rights is irrevocable. Neither the Company, its board nor the Subscription Agent is making any recommendation regarding your exercise of the Subscription Rights. The Subscription Rights will not be listed for trading or
quoted on the Nasdaq Capital Market or on any other stock exchange or market. 
 The Rights Offering is expected to expire at 5:00 p.m., Eastern Time, on
[●], 2017 (the “Expiration Date”), subject to extension and earlier termination. After the Expiration Date, unexercised Subscription Rights will be null and void. The Company will not be obligated to honor any purported exercise
of the Subscription Rights received by Broadridge Corporate Issuer Solutions, Inc. (the “Subscription Agent”) after 5:00 p.m., Eastern Time, on the Expiration Date, regardless of when the documents relating to such exercise were sent. 

There is no minimum number of Shares you must purchase. If you exercise your Basic Subscription Privilege in full, you may also subscribe for additional
Shares that remain unsubscribed at the Expiration Date at the same Subscription Price (the “Oversubscription Privilege”), subject to certain limitations described in the Prospectus. If an insufficient number of Shares are available to
fully satisfy all Oversubscription Privilege exercises, the available Shares will be allocated proportionately among those who exercise their Oversubscription Privilege based on the number of Shares each such person subscribed for under the Basic
Subscription Privilege. See “The Rights Offering — The Subscription Rights” in the Prospectus. 

The number of Subscription Rights to which you are entitled is printed on the face of your Subscription Rights Certificate. You should indicate your wishes
with regard to the exercise of your Subscription Rights by completing the appropriate portions of your Subscription Rights Certificate and/or Beneficial Owner Election Form and returning it to the Subscription Agent in the envelope provided pursuant
to the procedures described herein. 
 YOUR SUBSCRIPTION RIGHTS CERTIFICATE (OR NOTICE OF GUARANTEED DELIVERY) AND SUBSCRIPTION PRICE PAYMENT FOR EACH
SUBSCRIPTION RIGHT THAT IS EXERCISED PURSUANT TO THE BASIC SUBSCRIPTION PRIVILEGE PLUS THE FULL SUBSCRIPTION PRICE FOR ANY ADDITIONAL SHARES OF COMMON STOCK SUBSCRIBED FOR PURSUANT TO THE OVERSUBSCRIPTION PRIVILEGE, BY PERSONAL, CASHIER’S OR
CERTIFIED CHECK DRAWN ON A U.S. BANK, U.S. POSTAL MONEY ORDER OR BY WIRE TRANSFER OF IMMEDIATELY AVAILABLE FUNDS, MUST BE ACTUALLY RECEIVED BY THE SUBSCRIPTION AGENT, PRIOR TO 5:00 P.M., EASTERN TIME, ON THE EXPIRATION DATE. ONCE A RECORD HOLDER HAS
EXERCISED THE BASIC SUBSCRIPTION PRIVILEGE AND THE OVERSUBSCRIPTION PRIVILEGE, SUCH EXERCISE MAY NOT BE REVOKED. SUBSCRIPTION RIGHTS NOT EXERCISED PRIOR TO 5:00 P.M., EASTERN TIME, ON THE EXPIRATION DATE, AS EXTENDED, OF THE RIGHTS OFFERING WILL
EXPIRE. 












 1. Method of Exercise and Payment. 

Subscriptions by Record Holders 
 A record holder is
a holder of our Common Stock whose shares are registered in his, her or its name. To exercise your Subscription Rights, complete your Subscription Rights Certificate and send the properly completed and executed Subscription Rights Certificate
evidencing such Subscription Rights, with any signatures required to be guaranteed, together with payment in full of the Subscription Price for each Share subscribed for pursuant to the Basic Subscription Privilege and the Oversubscription
Privilege, to the Subscription Agent so that it will be received by the Subscription Agent prior to 5:00 p.m., Eastern time, on the Expiration Date. Payment of the Subscription Price for the Basic Subscription Privilege and the Oversubscription
Privilege will be held in a segregated account to be maintained by the Subscription Agent until the Shares are issued. All payments must be made in U.S. dollars for the full number of Shares being subscribed for by a personal, cashier’s
or certified check drawn on a U.S. bank, or U.S. Postal money order, payable to “Broadridge Corporate Issuer Solutions, Inc. (acting as subscription agent for SCHMITT INDUSTRIES, INC.)” or by wire transfer of immediately available funds
directly to the account maintained by Broadridge Corporate Issuer Solutions, Inc. as agent for SCHMITT INDUSTRIES, INC., for purposes of accepting subscriptions in the Rights Offering, at U.S. Bank, 800 Nicollet Mall, Minneapolis, MN 55402 United
States, Beneficiary Account Name: Broadridge, Account Number: 153910728465, ABA/Routing number: 123000848, with reference to the Subscription Rights holder’s name. Please reference your Subscription Rights
Certificate Number on your check. 
 The Subscription Rights Certificate (or, if applicable, Notice of Guaranteed Delivery as described below) and payment
of the Subscription Price (unless submitted by wire transfer) must be delivered to the Subscription Agent by hand, mail or overnight courier to the following address: 
  

			
	 By mail:
  
	  	 By hand or overnight courier:
  

	 Broadridge Corporate Issuer Solutions, Inc.

Attn: BCIS Re-Organization Dept.

P.O. Box 1317
 Brentwood, New York 11717-0693

800-733-1121 (toll free)
	  	 Broadridge Corporate Issuer Solutions, Inc.

Attn: BCIS IWS
 51 Mercedes Way

Edgewood, New York 11717
 800-733-1121


 Delivery to an address other than those above does not constitute valid delivery. 

If you wish to exercise your Subscription Rights, but you do not have sufficient time to deliver your Subscription Rights Certificate to the Subscription Agent
on or prior to the Expiration Time, you may cause a written guarantee substantially in the form of Annex A to these instructions (the “Notice of Guaranteed Delivery”), from a member firm of a registered national securities exchange or a
member of the Financial Industry Regulatory Authority, Inc., or from a commercial bank or trust company having an office or correspondent in the United States or from a bank, shareholder, savings and loan association or credit union with membership
in an approved signature guarantee medallion program, pursuant to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended, (each, an “Eligible Institution”), to be received by the
Subscription Agent on or prior to the Expiration Time, together with payment in full of the applicable subscription price. Such Notice of Guaranteed Delivery must state: 
  

	•	 	your name; 

  

	•	 	the number of Subscription Rights represented by your Rights Certificate(s), the number of shares of Common Stock for which you are subscribing pursuant to the Basic Subscription Privilege, and the number of shares of
Common Stock for which you are subscribing pursuant to the Over-Subscription Privilege, if any; and 

  

	•	 	your guarantee that you will deliver to the subscription agent your Rights Certificate(s) evidencing the Rights you are exercising within two (2) business days following the date of the Notice of Guaranteed
Delivery. 

 If this procedure is followed, the properly completed Rights Certificate(s) evidencing the Rights being exercised must be
received by the subscription agent within two (2) Nasdaq Capital Market trading days following the date of the Notice of Guaranteed Delivery. The Notice of Guaranteed Delivery may be delivered to the subscription agent in the same manner as
Rights Certificates at the address set forth above. Additional copies of the Notice of Guaranteed Delivery may be obtained upon request from the Subscription Agent at the address or phone number set forth above. 

Subscriptions by Beneficial Owners 
 A beneficial
owner is a holder of our Common Stock whose shares are registered in the name of a broker, custodian bank or other nominees. In such case, the broker, custodian bank or other nominees is the record holder of the Subscription Rights. To exercise your
Subscription Rights, instruct your broker, custodian bank or other nominee to exercise your rights and deliver all documents and payment in full of the Subscription Price on your behalf for each Share subscribed for pursuant to the Basic
Subscription Privilege and the Oversubscription Privilege, to the Subscription Agent so that it will be actually received by the Subscription Agent prior to 5:00 p.m., Eastern Time, on the Expiration Date. 












 By making arrangements with your broker, custodian bank or other nominee for the delivery of funds on your
behalf, you may also request such broker, custodian bank or other nominee to exercise the Rights Certificate on your behalf. 
 2. Issuance of Common
Stock. 
 Following the receipt of a properly completed and executed Subscription Rights Certificate, together with the payment of the Subscription Price
for the Shares subscribed for, and promptly after all pro rata allocations and adjustments contemplated by the terms of the Rights Offering have been effected, the following deliveries and payments will be made to the address
shown on the face of your Subscription Rights Certificate, or, if you hold your shares in book-entry form, such deliveries and payments will be in the form of a credit to your account: 

 

	a.	Basic Subscription Privilege: The Subscription Agent will deliver to each exercising Record Holder who validly exercises the Basic Subscription Privilege each Share subscribed for pursuant to the Basic
Subscription Privilege. See “The Rights Offering — Basic Subscription Right” in the Prospectus. 

  

	b.	Oversubscription Privilege: The Subscription Agent will deliver to each Record Holder who validly exercises the Oversubscription Privilege each Share, if any, allocated to such Record Holder pursuant to the
Oversubscription Privilege. See “The Rights Offering — Over-Subscription Right,” in the Prospectus. 

  

	c.	Excess Cash Payments: The Subscription Agent will mail to each Record Holder who exercises a Subscription Right any excess amount, without interest or deduction, received in payment of the Subscription Price for
Shares that are subscribed for by such Record Holder. 

 3. Sale, Transfer or Assignment of Subscription Rights. 

Subscription Rights may not be sold, transferred or assigned; provided, however, that Subscription Rights are transferable to an affiliate of the holder or by
operation of law (for example, the transfer of Rights to the estate of a recipient upon the recipient’s death). 
 4. Commissions, Fees and
Expenses. 
 The Company will pay all fees and expenses of the Subscription Agent related to its acting in such role in connection with the Rights
Offering. You are responsible for paying any other commissions, fees, taxes or expenses incurred in connection with the exercise of Subscription Rights or subscribing for Shares. Neither the Subscription Agent nor the Company will pay such expenses.

 5. Execution. 
  

	a.	Execution by Registered Holder. The signature on the Subscription Rights Certificate must correspond with the name of the Record Holder exactly as it appears on the face of the Subscription Rights
Certificate without any alteration, enlargement or change whatsoever. Persons who sign the Subscription Rights Certificate in a representative or other fiduciary capacity on behalf of a registered holder must indicate their capacity when signing
and, unless waived by the Subscription Agent in its sole and absolute discretion, must present to the Subscription Agent satisfactory evidence of their authority so to act. 


 

	b.	Signature Guarantees. If you are neither a Record Holder (or signing in a representative or other fiduciary capacity on behalf of a Record Holder) nor an eligible institution, such as a member firm of a
registered national securities exchange or a member of the Financial Industry Regulatory Authority or a commercial bank or trust company having an office or correspondent in the United States, your signature must be guaranteed by such an eligible
institution. 

 6. Method of Delivery to Subscription Agent. 

The method of delivery of Subscription Rights Certificates and payment of the Subscription Price to the Subscription Agent for each Share subscribed for will
be at the risk of the holders of Subscription Rights. If sent by mail, we recommend that you send those certificates and payments by overnight courier or by registered first class mail, properly insured, with return receipt requested, and that a
sufficient number of days be allowed to ensure delivery to the Subscription Agent and clearance of payment prior to 5:00 p.m., Eastern Time, on the Expiration Date. 

7. Special Provisions Relating to the Delivery of Subscription Rights through the Depository Trust Company. 

In the case of Subscription Rights that are held of record through the Depository Trust Company (the “Book-Entry Transfer Facility”), exercises of
Subscription Rights under the Basic Subscription Privilege and the Oversubscription Privilege may be effected by instructing the Book-Entry Transfer Facility to transfer Subscription Rights from the Book-Entry Transfer Facility account of such
holder to the Book-Entry Transfer Facility account of the Subscription Agent, together with certification as to the aggregate number of Subscription Rights exercised and the number of Shares thereby subscribed for pursuant to the Basic Subscription
Privilege and the Oversubscription Privilege by each beneficial owner of Subscription Rights on whose behalf such nominee is acting, and payment of the Subscription Price for each Share subscribed for pursuant to the Basic Subscription Privilege and
the Oversubscription Privilege. 












 Payments of the Subscription Price (unless submitted by wire transfer) should be mailed or delivered to the
appropriate address (or, for wire transfer payments, to the appropriate account) as described under Section 1, “Method of Exercise and Payment” above. 

8. Substitute Form W-9. 

TO ENSURE COMPLIANCE WITH IRS CIRCULAR 230, YOU ARE HEREBY NOTIFIED THAT: (A) ANY DISCUSSION OF U.S. FEDERAL TAX ISSUES CONTAINED OR REFERRED TO HEREIN IS
NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT BE USED, BY ANY TAXPAYER FOR THE PURPOSE OF AVOIDING U.S. FEDERAL, STATE OR LOCAL TAX PENALTIES, (B) SUCH DISCUSSION IS WRITTEN IN CONNECTION WITH THE PROMOTION OR MARKETING OF THE TRANSACTION OR
MATTERS DISCUSSED HEREIN, AND (C) THE TAXPAYER SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR. 
 Each
holder who elects to exercise Rights should provide the Subscription Agent with a correct Taxpayer Identification Number (“TIN”) on Substitute Form W-9, a copy of which is being furnished to each
holder. Additional copies of Substitute Form W-9 may be obtained upon request from the Subscription Agent at the address set forth above or by contacting Broadridge Corporate Issuer Solutions, Inc., the
Information Agent. Failure to provide the information on the form may subject such holder to a $50.00 penalty for each such failure and to U.S. federal income tax backup withholding (currently at a 28% rate) with respect to dividends that may be
paid by the Company on shares of Common Stock purchased upon the exercise of Rights (for those holders exercising Rights). 
 If you have any questions
concerning the rights offering, please contact the information agent, Broadridge Corporate Issuer Solutions, Inc., the Information Agent, Attn: BCIS IWS, 51 Mercedes Way, Edgewood, New York 11717, by telephone (800-733-1121) or by email (Shareholder@Broadridge.com). 
 Sincerely, 

SCHMITT INDUSTRIES, INC. 












 Annex A 

Notice of Guaranteed Delivery