EXHIBIT 10.1
 
 
 
EXCHANGE AGREEMENT
This Exchange Agreement is made this 18th day of July, 2011 by and between
Champion Industries, Inc. (“Champion”), a West Virginia corporation, and
Marshall T. Reynolds (“Reynolds”).
 
WITNESSETH:
 
WHEREAS, Champion is the Maker of a Promissory Note dated December 29, 2009 in
principal amount of Three Million Dollars ($3,000,000) payable to the order of
Reynolds as Holder (“the Note”) pursuant to and in accordance with that certain
Forbearance Agreement dated December 29, 2009 among Fifth Third Bank, as
Administrative Agent, Champion and Reynolds; and
WHEREAS, Reynolds and Champion desire to exchange the Note in whole, together
with the $147,875 interest thereon accrued but unpaid, for common stock of
Champion by exchange of the principal amount thereof and accrued interest
thereon into Champion common stock at a conversion ratio based upon the book
value of Champion common stock at April 30, 2011, the date of the most recent
filing of financial information by Champion with the United States Securities
and Exchange Commission.
NOW THEREFORE, in consideration of the foregoing, which are not mere recitals
but are an integral part hereof, the parties agree as follows:
1.  
Reynolds agrees to irrevocably transfer, assign, sell and convey to Champion the
Note, together with all interest thereon accrued in exchange for, and Champion
agrees to issue to Reynolds One Million Three Hundred Eleven Thousand Six
Hundred Fifteen (1,311,615) shares of Champion common stock, par value $1.00,
the ratio of exchange being Two and 40/100 Dollars ($2.40) of Note principal and
accrued interest for one (1) share of Champion common stock, the book value of
Champion common stock at April 30, 2011 being $2.40 per share.

2.  
Reynolds acknowledges that the Champion common stock to be received by him
pursuant to this Exchange Agreement will be issued under an exemption from the
registration requirements of the Securities Act of 1933, as amended (the “Act”),
as a transaction not involving a public offering.  Reynolds agrees that he will
not offer to sell, transfer, pledge, encumber or dispose of any such Champion
common stock unless (i) a registration statement with respect to the shares so
to be disposed of has been filed and been declared effective under the Act or
(ii) such disposition is exempt from registration under the Act, and counsel
satisfactory to Champion has delivered to Champion an opinion that registration
is not required in connection with such disposition.  Reynolds agrees that
Champion may place a legend to the above effect on certificates for this stock
to be issued to Reynolds pursuant to this Exchange Agreement and may advise its
transfer agents and registrars of the foregoing restrictions and instruct them
not to transfer any of such stock except in compliance with the above and upon
written authorization from Champion.

3.  
The Closing of the Exchange shall take place at the offices of Huddleston Bolen
LLP, 611 Third Avenue, Huntington, West Virginia on or before July 27, 2011.

4.  
This Exchange Agreement shall be governed by and construed under the substantive
laws of the State of West Virginia with respect to contracts made and to be
performed in that state.

5.  
This Exchange Agreement is made solely for the benefit of Champion and Reynolds,
and no other person or entity shall acquire or have any right, under or by
virtue hereof. This Exchange Agreement shall be binding upon the parties hereto
and their respective successors and assigns.

 IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the date first above written.            CHAMPION INDUSTRIES, INC.              
 
 By: /s/ Todd R. Fry

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 Its:  Senior Vice President and Chief Financial Officer                      
 /s/ Marshall T. Reynolds

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MARSHALL T. REYNOLDS

 
 
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