Portland, Oregon – Schmitt Industries has entered into an agreement with a commercial bank for a $1.0 million standby line of credit to be secured by accounts receivable, inventories and general intangibles. The line requires interest at the Banks prime rate of interest and will expire on September 1, 2006.

Wayne Case, President and Chief Executive Officer of Schmitt said: “We are pleased to announce the standby Line of Credit agreement we entered into this month. It obviously demonstrates the continued strong financial performance of Schmitt. In the short term future, we have no plans to use any of the funds available under this line. However, over the longer term, as internal and external growth opportunities become available to Schmitt, this line of credit could provide some of the funds, should we choose to use them, to finance those growth and/or acquisition opportunities.”

The information contained in this release contains certain forward-looking statements that anticipate future trends or events. These statements are based on certain assumptions that may prove to be erroneous and are subject to certain risks including but not limited to the uncertainties of the Company’s new product introductions, the risks of increased competition and technological change in the Company’s industry and other factors detailed in the Company’s SEC filings. Accordingly, actual results may differ, possibly materially, from the predictions contained herein.