Page 10 of 17 SEC Filing
(c) Mr. Reynolds is the Chief Executive Officer and Chairman of the Board of Directors of Champion Industries, Inc. (“the Company”). The Company is principally in the commercial printing and office products business and is located at 2450 First Avenue, Huntington, WV 25703. Mr. Reynolds is also the Chairman of various other businesses and manages a variety of other investments. Mr. Wilcox is the Chairman of the Board of Directors of Wilcox Travel Agency, Inc. located 1705 BB&T Building, Asheville, NC 28801 and is a member of the Company’s Board of Directors. Mr. Cline manages various investments and a member of various boards including the Company’s. Mr. Scaggs is President of Baisden Brothers, Inc. which is a retail and wholesale hardware business located at 340 Riverview Drive, Logan, WV 25601. Mr. Scaggs is also on the Company’s Board of Directors. Mr. Akers is the Director of the Huntington West Virginia Sanitary Board and President of Metric of West Virginia. The Huntington Sanitary Board address is 555 7th Avenue, Huntington, WV 25701. Metric of West Virginia is principally in the business of metal recycling and is located at 5095 Waverly Road, Huntington, WV 25704. Mr. Akers is also on the Company’s Board of Directors. Mr. Evans is the Company’s Senior Vice President and Chief Financial Officer.
(d) During the past five years, none of the Reporting Persons, and to the knowledge of each Reporting Person, none of the executive officers or, to the extent applicable, directors of any such Reporting Person that is not an individual, has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors).
(e) During the last five years, none of the Reporting Persons, and to the knowledge of each Reporting Person, none of the executive officers or, to the extent applicable, directors of any such Reporting Person that is not an individual, has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.
(f) All Reporting Persons that are individuals are citizens of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
The reporting persons do not intend to make any purchases of the Class A Common Stock of the Company in connection with the proposed transaction referenced in this filing.
As noted above, in Item 2(a), pursuant to the proposed transaction, stockholders holding fewer than 200 shares of the Company’s Class A Common Stock immediately before the transaction would have such shares cancelled and converted into the right to receive from the Company a cash payment of thirty cents ($0.30) for each such share owned before the reverse stock split. Stockholders holding 200 or more shares of the Company’s Class A Common Stock immediately before the reverse stock split will receive one share for each 200 common shares held and, as applicable, fractional shares based on the 1-for-200 reverse stock split ratio. Cash consideration would only be paid by the Company to shareholders who, after the reverse stock split, hold less than one (1.0) whole share of the post-split Class A Common Stock. Thus, any such cash payments for such fractional shares of less than one (1.0) whole share of the post-split Class A Common Stock would be made and funded by the Company.
Item 4. Purpose of Transaction.
This filing is being made because the Board of Directors on January 18, 2016 approved a 1-for-200 reverse stock split of the outstanding shares of its Class A Common Stock. As part of the proposed transaction, authorized shares of Class B Common Stock, which are unissued, likewise would be subject to and adjusted for a 1-for-200 reverse stock split as well.
If the transaction is approved by the Company’s stockholders and implemented, the Company expects to have fewer than 300 stockholders of record of its outstanding common stock, in which event the Company intends to deregister its shares and cease to be a reporting company under the Securities and Exchange Act of 1934.
Pursuant to the proposed transaction, stockholders holding fewer than 200 shares of the Company’s Class A Common Stock immediately before the transaction would have such shares cancelled and converted into the right to receive from the Company a cash payment of thirty cents ($0.30) for each such share owned before the reverse stock split. Stockholders holding 200 or more shares of the Company’s Class A Common Stock immediately before the reverse stock split will receive one share for each 200 common shares held and, as applicable, fractional shares based on the 1-for-200 reverse stock split ratio. Cash consideration would only be paid to shareholders who, after the reverse stock split, hold less than one (1.0) whole share of the post-split Class A Common Stock.
Implementation of the reverse stock split is subject to stockholder approval of an amendment to the Company’s Articles of Incorporation. Approval of the amendment would require the approval of a majority of the Company’s outstanding shares. The Company expects the amendment will be presented to the stockholders for a vote on the amendment at the Company’s 2016 annual meeting of stockholders which will be held on March 21, 2016, and that if this amendment is approved, the reverse stock split and deregistration will be effective thereafter. If for any reason, the amendment cannot be presented at the 2016 annual stockholders meeting, the Board will set a date and time for a special meeting of stockholders at which the amendment will be voted upon by stockholders.
The reporting persons submitting this filing include the current directors and the Company’s current Chief Executive Officer/Chairman of the Board as well as its current Senior Vice President/Chief Financial Officer. Considered together they currently own approximately 56.6% of the Company’s outstanding Class A Common Stock, although it is noted that Mr. Evans does not own any such shares. In their capacities as directors and/or officers, these reporting persons have indicated they support the proposed transaction and, to the extent they own or control shares of Class A Common Stock, they intend to support the proposed transaction and to vote in favor of the proposed amendment to the Company’s Articles of Incorporation when the amendment is presented to a vote of the Company’s stockholders. (It is noted that Mr. Evans does not own any shares of Class A Common Stock.) To the extent they thus may be viewed or considered a group acting to effectuate transactions that would lead to the ultimate deregistration of the Company and its Class A Common Stock, these reporting persons are making this filing.
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