Rocky Mountain Chocolate Factory Inc. announced the appointment of Al Harper, CEO of American Heritage Railways, to its board of directors Tuesday.
The move comes after American Heritage Railways acquired a significant stake in the confectioner earlier this year.
In August, American Heritage Railways purchased about 13% of Rocky Mountain’s shares, a $2.2 million investment for 1.25 million shares at $1.75 a piece. Harper’s board appointment was part of the agreement, reflecting his desire for a governance role, according to Rocky Mountain’s Interim CEO Jeff Geygan.
“American Heritage Railways is a great partner for us,” Mr. Geygan said, describing Harper as a seasoned executive whose leadership and business acumen will bolster the board’s capabilities.
The Durango-based chocolate manufacturer and franchiser faced a rocky summer, with shares tumbling to $1.53 in August, their lowest level in five years. However, the company had a more favorable fall 2024, with its stock climbing to $3.22 on Oct. 28, ahead of Halloween where confectionery products tends to be in demand. As of Tuesday, shares were trading at $2.66.
Harper’s continued involvement reflects broader efforts by Rocky Mountain Chocolate Factory to solidify its roots in Durango while positioning itself for growth. Rocky Mountain has undergone a slew of personnel changes along with its struggling stock prices in recent years. But Harper isn’t worried about the company’s trajectory, saying he has faith in the leadership of Geygan.
Geygan has underscored his dedication to revitalizing Rocky Mountain Chocolate Factory by stepping down from his position on the board and taking on the role of interim CEO indefinitely.
In the process, Geygan took a leave of absence from his position as board chairman for Global Value Investment Corp., an investment research and advisory firm he founded in 2007.
“He’s bound and determined to bring that stock price back up,” Harper said. “When you have someone who’s that committed, you want to partner with them.”
American Heritage’s influence on the company brings decades of retail experience to the table. Harper hopes to instill more of his community-based philosophy on the board – something both Geygan and Harper agree upon.
“You have to put love into the business,” Harper said. “Success is the result of doing what’s good for your community.”
The partnership between American Heritage Railways and Rocky Mountain Chocolate Factory reflects a mutually beneficial alignment of interests. Both companies stand to gain from Durango’s robust tourism market, where a Rocky Mountain Chocolate Factory retail store operates just a quarter-mile from American Heritage’s train station, creating natural synergies between the two businesses.
American Heritage Railways, a well-known Durango-based enterprise, reaches over 2 million customers annually through its railroads, historic attractions and licensed special events at more than 50 locations. The partnership presents a significant opportunity for Rocky Mountain Chocolate Factory to expand its customer base.
Under the company’s current nonemployee director compensation policy, Harper will receive an annual cash retainer of $32,000 and an annual equity award valued at $40,000 in restricted stock units.
The equity award will be calculated based on the 10-day volume-weighted average price of the company’s common stock on the Nasdaq Global Market. Both the cash retainer and equity award will be prorated for Harper’s initial year of service on the board.
“We really want to have Rocky Mountain Chocolate Factory in our community,” Harper said. “They’re good for our economy.”
tbrown@durangoherald.com
