| • | a general unsecured obligation of the Guarantor, except to the extent of the Collateral owned by such Guarantor; | • | | pari passu in right of payment with existing and future unsecured senior Indebtedness of a Guarantor, except to the extent of the Collateral owned by such Guarantor; | | | • | pari passuin right of payment with existing and future unsecured senior Indebtedness of that Guarantor, except to the extent of the Collateral owned by such Guarantor; | | | • | effectively subordinated to secured Indebtedness of that Guarantor up to the value of the collateral (other than the Collateral) securing such Indebtedness; and | | | • | senior in right of payment to existing and future subordinated Indebtedness, if any, of that Guarantor. |
effectively subordinated to secured Indebtedness of a Guarantor up to the value of the collateral securing such Indebtedness (other than the Collateral); and senior in right of payment to existing and future subordinated Indebtedness, if any, of a Guarantor. In the event of a bankruptcy, liquidation or reorganization of any of the non-guarantor Subsidiaries, the non-guarantor Subsidiaries will pay the holders of their debt and their trade creditors before they will be able to distribute any of their assets to us. As a result, the Exchange Notes will be effectively subordinated in right of payment to all Indebtedness and other liabilities and commitments (including trade payables and lease obligations) of our non-guarantor Subsidiaries. As of December 31, 2013, on a historical basis, our subsidiaries that do not guarantee the Notes had approximately $113 million aggregate principal amount of debt outstanding (including current maturities) and $569 million of other liabilities.As of the Issue Date,date of this prospectus, all of our wholly-owned Subsidiaries except Titan Wheel Corporation of Virginia were “Restricted Subsidiaries.” However, under the circumstances described below under the caption “—Certain Covenants — Covenants—Designation of Restricted and Unrestricted Subsidiaries,” we will be permitted to designate certain of our Subsidiaries that do not own the Collateral as “Unrestricted Subsidiaries.” Our Unrestricted Subsidiaries will not be subject to many of the restrictive covenants in the Indenture. Our Unrestricted Subsidiaries will not guarantee the notes.
33 Notes. Principal, Maturity and InterestAdditionalTitan will issue up to $400.0 million in aggregate principal amount of Exchange Notes
in this offering. Titan may issue additional notes (“Additional Notes”) under the Indenture from time to time after this offering. Any issuance of additional notes isAdditional Notes will be subject to all of the covenants in the Indenture, including the covenant described below under the caption “—Certain Covenants — Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock.” The notesNotes and any additional notesAdditional Notes subsequently issued under the Indenture will be treated as a single class for all purposes under the Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. Additional Notes may not be fungible with other Notes for U.S. federal income tax purposes, may not trade fungibly with other Notes, may trade under a separate CUSIP number and may be treated as separate class of notes for purposes of transfers and exchanges. Unless the context requires otherwise, references to “Notes” for all purposes of the Indenture and this “Description of Notes” include any Additional Notes actually issued. Titan will issue Notes in denominations of $2,000 and integral multiples of $1,000. The Notes will mature on October 1, 2020.Interest on the Notes will accrue at the rate of 6.875% per annum and will be payable semiannually in arrears on April 1 and October 1, commencing on April 1, 2014. Interest on overdue principal and interest will accrue at a rate that is 1.00% higher than the then applicable interest rate on the Notes. Titan will make each interest payment to the holders of record on the immediately preceding March 15 and September 15. Interest on the Notes will accrue from the date of original issuance or, if interest has already been paid, from the date it was most recently paid. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months. Methods of Receiving Payments on the Notes If a holder of notesNotes holding in excess of $5.0 million of notesNotes has given wire transfer instructions to Titan, Titan will pay all principal, interest and premium, if any, on that holder’s notesNotes in accordance with those instructions. All other payments on the notesNotes will be made at the office or agency of the paying agent and registrar within the City and State of New York unless Titan elects to make interest payments by check mailed to the noteholders at their address set forth in the register of holders. Paying Agent and Registrar for the Notes The Trustee will initially act as paying agent and registrar. Titan may change the paying agent or registrar without prior notice to the holders of the notes,Notes, and Titan or any of its Subsidiaries may act as paying agent or registrar. A holder may transfer or exchange notesNotes in accordance with the provisions of the Indenture. The registrar and the Trustee may require a holder, among other things, to furnish appropriate endorsements and transfer documents in connection with a transfer of notes.Notes. Holders will be required to pay all taxes due on transfer. Titan will not be required to transfer or exchange any noteNote selected for redemption. Also, Titan will not be required to transfer or exchange any notesNote for a period of 15 days before a selection of notesNotes to be redeemed. The outstanding notesOutstanding Notes are, and the exchange notesExchange Notes will be, guaranteed by certain of Titan’s Subsidiaries, which own any interest in the Collateral. These Note Guarantees will be joint and several obligations of the Guarantors. The obligations of each Guarantor under its Note Guarantee will be limited to an amount not to exceed the maximum amount that can be guaranteed by such Guarantor by law or without resulting in its obligations under its Note Guarantee being voidable or unenforceable under applicable laws relating to fraudulent conveyance or fraudulent transfer, or under similar laws affecting the rights of creditors generally. We cannot assure you that this limitation will protect the Note Guarantees from fraudulent conveyance or fraudulent transfer challenges or, if it does, that the remaining amount due and collectible under the Note Guarantees would suffice, if necessary, to pay the notes in full when due. In a recent Florida bankruptcy case, this kind of provision was found to be unenforceable and, as a result, the subsidiary guarantees in that case were found to be fraudulent conveyances. We do not know if that case will be followed if there is litigation on this point under the Indenture. However, if it is followed, the risk that the Note Guarantees will be found to be fraudulent conveyances will be significantly increased. See “Risk Factors — Factors—Federal and state statutes allow courts, under specific circumstances, to void guarantees and require Notenote holders to return payments received from guarantors.” The Note Guarantee of a Guarantor will be automatically released with respect to the notesNotes when such Guarantor ceases to own any interest in the Collateral. The payment of the notes,Notes, when due, whether on an interest payment date, at maturity, by acceleration, repurchase, redemption or otherwise and whether by Titan pursuant to the notesNotes or by any Guarantor pursuant to the Note Guarantees, and the performance of all other obligations of Titan and its Restricted Subsidiaries under the Security Documents are secured by first-priority liens on the Collateral as provided in the Security Documents.
34
Collateral Trustee Titan has appointed a collateral trustee (the “Collateral Trustee”) for the benefit of the holders of the Note Obligations outstanding from time to time. The Security Documents will provide that the Collateral Trustee will be required to act pursuant to directions delivered in accordance with the Indenture, subject to such directions as may be given it by the Trustee from time to time as required or permitted by the Indenture.provisions thereof. The relative rights with respect to control of the Collateral Trustee will be specified in the Indenture by and among Titan, the Guarantors, the Trustee and the Collateral Trustee. Except as provided in the Indenture or as directed by an Act of Required Debtholders, the Collateral Trustee will not be obligated: 1. to act upon directions purported to be delivered to it by any other Person; 2. to foreclose upon or otherwise enforce any Lien; or 3. to take any other action whatsoever with regard to any or all of the Security Documents, the Liens created thereby or the Collateral. The Indenture provides and the Security Documents will provide that the notesNotes and the Note Guarantees will be secured by first-priority security interests granted to the Collateral Trustee on all of the right, fee title and interest in and to the Mortgaged Properties (the “Collateral”): On or before the Mortgage Closing Date, Titan and the Guarantors willhave (i) enterentered into the Mortgages (which will provideprovided for the granting of a first priority lien and security interest in the Collateral in favor of the Collateral Trustee for the benefit of the Holders of the notes)Notes) and (ii) satisfysatisfied and deliverdelivered all other Real Estate Closing Deliverables (as defined in the Indenture). Although Titan and the Guarantors will use reasonable best efforts to satisfy and deliver the Real Estate Closing Deliverables as promptly as possible before the Mortgage Closing Date, the security interests in the Collateral will not be in place on the date of issuance of the exchange notes. See “Risk Factors — Security over the Collateral on which a lien in favor of the Collateral Trustee is required will not be in place on the date of issuance of the exchange notes and will not be perfected on such date.” If the Collateral Trustee at any time receives written notice stating that any event has occurred that constitutes a default under any Security Document entitling the Collateral Trustee to foreclose upon, collect or otherwise enforce its Liens thereunder, it will promptly deliver written notice thereof to the Trustee. Thereafter, the Collateral Trustee will await direction by holders of a majority of the principal amount of the notesNotes and will act, or decline to act, as directed by an Act of Required Debtholders, in the exercise and enforcement of the Collateral Trustee’s interests, rights, powers and remedies in respect of the Collateral or under the Security Documents or applicable law and, following the initiation of such exercise of remedies, the Collateral Trustee will act, or decline to act, with respect to the manner of such exercise of remedies as directed by an Act of Required Debtholders. Unless it has been directed to the contrary by an Act of Required Debtholders, the Collateral Trustee in any event may (but will not be obligated to) take or refrain from taking such action with respect to any default under any Security Document as it may deem advisable to preserve and protect the value of the Collateral. Until the Discharge of the Note Obligations, Holders of a majority of the principal amount of the notesNotes will have the exclusive right to authorize and direct the Collateral Trustee with respect to the Security Documents and the Collateral (including, without limitation, the exclusive right to authorize or direct the Collateral Trustee to enforce, collect or realize on any Collateral or exercise any other right or remedy with respect to the Collateral). Certain Bankruptcy Limitations The right of the Collateral Trustee (acting on behalf of the Trustee and the Holders of the notes)Notes) to foreclose on the Collateral upon the occurrence of an Event of Default would be significantly impaired by applicable bankruptcy law in the event that a bankruptcy case were to be commenced by or against Titan or any Guarantor prior to the Collateral Trustee’s having repossessed and disposed of the Collateral. Upon the commencement of a case for relief
35
under Title 11 of the United States Code, as amended (the “Bankruptcy Code”), a secured creditor such as the Collateral Trustee is prohibited from foreclosing on its security from a debtor in a bankruptcy case, or from disposing of security foreclosed on, without bankruptcy court approval. In view of the broad equitable powers of a U.S. bankruptcy court, it is impossible to predict how long payments under the notesNotes could be delayed following commencement of a bankruptcy case, whether or when the Collateral Trustee could foreclose upon the Collateral, the value of the Collateral at the time of the bankruptcy petition or whether or to what extent Holders of the notesNotes would be compensated for any delay in payment or loss of value of the Collateral. The Bankruptcy Code permits only the paymentand/or accrual of post petition interest, costs and attorneys’ fees to a secured creditor during a debtor’s bankruptcy case to the extent the value of the Collateral is determined by the bankruptcy court to exceed the aggregate outstanding principal amount of the obligations secured by the Collateral. Furthermore, in the event a bankruptcy court determines that the value of the Collateral is not sufficient to repay all amounts due on the notes,Notes, the Holders of the notesNotes would hold secured claims to the extent of the value of the Collateral to which the Holders of the notesNotes are entitled, and unsecured claims with respect to such shortfall. Release of Security Interests The Security Documents will provide that the Collateral will be released: 1. in whole, upon payment in full of all Note Obligations that are outstanding, due and payable at the time such debt is paid in full, provided that Titan has delivered an Officer’s Certificateofficers’ certificate to the Collateral Trustee certifying that the conditions described in this paragraph (1) have been met and that such release of the Collateral does not violate the terms of the Security Documents; 2. upon satisfaction and discharge of the Indenture as set forth under the caption “—Satisfaction and Discharge”; 3. upon a Legal Defeasance or Covenant Defeasance as set forth under the caption “—Legal Defeasance and Covenant Defeasance”; 4. upon payment in full of the notesNotes and all other Note Obligations that are outstanding, due and payable at the time the notesNotes are paid in full; or 5. as to a release of all of the Collateral, if (a) consent to the release of that Collateral has been given by Holders of 662/⁄3% of the principal amount of the notes,Notes, and (b) Titan has delivered an Officers’ Certificateofficers’ certificate to the Collateral Trustee certifying that any such necessary consents have been obtained and that such release of the Collateral does not violate the terms of the Security Documents. Titan will comply with the provisions of TIA §Section 314(b); of the Trust Indenture Act;provided, that Titan will not be required to comply with TIA §Section 314(b)(1) of the Trust Indenture Act until the Indenture is qualified under the TIA. Trust Indenture Act.To the extent applicable, Titan will furnish to the Trustee, prior to each proposed release of Collateral pursuant to the Security Documents: 1. all documents required by TIA §Section 314(d); of the Trust Indenture Act; and 2. an opinion of counsel to the effect that such accompanying documents constitute all documents required by TIA §Section 314(d). of the Trust Indenture Act.If any Collateral is released in accordance with the Indenture or any Security Document and if Titan has delivered the certificates and documents required by the security documents and this covenant, the Trustee will deliver a certificate to the Collateral Trustee stating that it has received such documentation.
36
AmendmentAmendment
The Indenture provides that no amendment or supplement to the provisions of the Indenture or any other security document will be effective without the approval of the Collateral Trustee acting as directed by Holders of a majority of the principal amount of the notes,Notes, except that: (1) any amendment or supplement that has the effect solely of (a) adding or maintaining Collateral, (b) curing any ambiguity, defect or inconsistency; (c) providing for the assumption of Titan or any Guarantor’s obligations under any security document in the case of a merger or consolidation or sale of all or substantially all of Titan or such Guarantor’s assets, as applicable; or (d) making any change that would provide any additional rights or benefits to the Holders of notes,Notes, or the Collateral Trustee or that does not adversely affect the legal rights under any Security Document of any Holder of notesNotes or the Collateral Trustee, will, in each case, become effective when executed and delivered by Titan or any other applicable Guarantor party thereto and the Collateral Trustee; (2) no amendment or supplement that reduces, impairs or adversely affects the right of any holder of Note Obligations: (a) to vote its outstanding Secured Debt as to any matter described as subject to an Act of Required Debtholders (or amends the provisions of this clause (2) or the definition of “Act of Required Debtholders,”); (b) to share in the order of application under the Indenture in the proceeds of enforcement of or realization on any Collateral that has not been released in accordance with the provisions described above under “—Release of Security Interests”; or (c) to require that Liens securing Note Obligations be released only as set forth in the provisions described above under the caption “—Release of Security Interests”; will become effective without the consent of the holders of 662/⁄3% of the notes;Notes; and (3) no amendment or supplement that imposes any obligation upon the Collateral Trustee or adversely affects the rights of the Collateral Trustee, as determined by the Collateral Trustee in its sole discretion, will become effective without the consent of the Collateral Trustee. Provisions of the Indenture Relating to Security Further Assurances; Insurance The Indenture provides and the Mortgages will provide that Titan and each of the Guarantors will do or cause to be done all acts and things that may be required, or that the Collateral Trustee from time to time may reasonably request, to assure and confirm that the Collateral Trustee holds, for the benefit of the Holders of notes,holders, duly created and enforceable and perfected Liens upon the Collateral. Upon the reasonable request of the Collateral Trustee at any time and from time to time, Titan and each of the Guarantors will promptly execute, acknowledge and deliver such security documents, instruments, certificates, notices and other documents, and take such other actions as may be reasonably required, or that the Collateral Trustee may reasonably request, to create, perfect, protect, assure or enforce the Liens and benefits intended to be conferred, in each case as contemplated by the Security Documents for the benefit of the Holders of notes. holders.The Indenture requires and the Mortgages will require that Titan and the Guarantors: (1) keep their properties adequately insured at all times by financially sound and reputable insurers; (2) maintain such other insurance, to such extent and against such risks (and with such deductibles, retentions and exclusions), including fire and other risks insured against by extended coverage, as is customary with companies in the same or similar businesses operating in the same or similar locations, including public liability insurance against claims for personal injury or death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled by them;
37
(3) maintain such other insurance as may be required by law; and (4) maintain such other insurance as may be required by the Security Documents. The Collateral Trustee will be named as an additional insured and loss payee as its interests may appear, to the extent required by the Security Documents. Upon the request of the Collateral Trustee, Titan and the Guarantors will furnish to the Collateral Trustee full information as to their property and liability insurance carriers. On and after October 1, 2013,2016, the notesNotes will be subject to redemption at any time at the option of Titan, in whole or in part, upon not less than 30 nor more than 60 days’ notice, in cash at the redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and additional interest, if any, thereon to the applicable redemption date, if redeemed during the twelve-month period beginning on October 1 of the years indicated below: | | | | | Year | | Percentage | | 2013 | | | 105.906 | % | 2014 | | | 103.938 | % | 2015 | | | 101.969 | % | 2016 and thereafter | | | 100.000 | % |
| | | | | Year | | Percentage | | 2016 | | | 105.156 | % | 2017 | | | 103.438 | % | 2018 | | | 101.719 | % | 2019 and thereafter | | | 100.000 | % |
Redemption with Certain Equity Proceeds At any time prior to October 1, 2013,2016, upon not less than 30 nor more than 60 days’ prior notice, Titan may on any one or more occasions redeem up to 35% of the aggregate principal amount of notesNotes issued under the Indenture at a redemption price of 107.875%106.875% of the principal amount, plus accrued and unpaid interest on the notesNotes redeemed to the redemption date, subject to the rights of holders of notesNotes on the relevant record date to receive interest on the relevant interest payment date, with the net cash proceeds of one or more Equity Offerings;providedthat: (1) at least 65% of the aggregate principal amount of notesNotes originally issued under the Indenture (excluding notesNotes held by Titan and its Subsidiaries) remains outstanding immediately after the occurrence of such redemption; and (2) the redemption occurs within 180 days of the date of the closing of such Equity Offering. At any time prior to October 1, 2016, Titan may also redeem all or a part of the notes,Notes, upon not less than 30 nor more than 60 days’ prior notice mailed by first-class mail to each holder’s registered address, at a redemption price equal to 100% of the principal amount of notesNotes redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, on the notesNotes to be redeemed to the date of redemption, (the “Redemption Date”), subject to the rights of holders of the notesNotes on the relevant record date to receive interest due on the relevant interest payment date. Titan is not required to make mandatory redemption or sinking fund payments with respect to the notes. Notes.Repurchase at the Option of Holders If a Change of Control occurs, each holder of notesNotes will have the right to require Titan to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000) of that holder’s notesNotes pursuant to a Change of Control Offer, subject to such holder’s right to reject such Change of Control Offer, on the terms set forth in the Indenture. In the Change of Control Offer, Titan will offer a Change of Control Payment in cash equal to 101% of the aggregate principal amount of notesNotes repurchased plus accrued and unpaid interest, if any, on the notesNotes repurchased to the date of purchase, subject to the rights of holders of notesNotes on the relevant record date to receive interest due on the relevant
38
interest payment date. Within 30 days following any Change of Control, Titan will mail a notice to each holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase notesNotes on the Change of Control Payment Date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed, pursuant to the procedures required by the Indenture and described in such notice. Titan will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the notesNotes as a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of the Indenture, Titan will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control provisions of the Indenture by virtue of such compliance. On the Change of Control Payment Date, Titan will, to the extent lawful: (1) accept for payment all notesNotes or portions of notesNotes properly tendered pursuant to the Change of Control Offer; (2) deposit with the paying agent an amount equal to the Change of Control Payment in respect of all notesNotes or portions of notesNotes properly tendered; and (3) deliver or cause to be delivered to the Trustee the notesNotes properly accepted together with an officers’ certificate stating the aggregate principal amount of notesNotes or portions of notesNotes being purchased by Titan. The paying agent will promptly mail to each holder of notesNotes properly tendered the Change of Control Payment for such notes,Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each holder a new note equal in principal amount to any unpurchased portion of the notesNotes surrendered, if any.any;provided that each new note issued will be in a principal amount of $2,000 or integral multiples of $1,000 increments thereof. Titan will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. The provisions described above that require Titan to make a Change of Control Offer, subject to such holder’s right to reject such Change of Control Offer, following a Change of Control will be applicable whether or not any other provisions of the Indenture are applicable. Except as described above with respect to a Change of Control, the Indenture does not contain provisions that permit the holders of the notesNotes to require that Titan repurchase or redeem the notesNotes in the event of a takeover, recapitalization or similar transaction. Titan will not be required to make a Change of Control Offer, with respect to the notes,Notes, upon a Change of Control if (1) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by Titan and purchases all notesNotes properly tendered and not withdrawn under thea Change of Control Offer, or (2) notice of redemption has been given pursuant to the Indenture as described above under the captions “—Optional Redemption,” “—Redemption with Certain Equity Proceeds” and ‘‘— “—Make-Whole Redemption,” unless and until there is a default in payment of the applicable redemption price. Notwithstanding anything to the contrary herein, a Change of Control Offer may be made in advance of a Change of Control and conditional upon such Change of Control if a definitive agreement is in place with respect to the event constituting the Change of Control at the time of the Change of Control Offer. If a Change of Control offerOffer is made, there can be no assurance that Titan will have available funds sufficient to pay the Change of Control purchase price for all the notesNotes that might be delivered by holders seeking to accept the Change of Control offer.Offer. In the event Titan is required to purchase outstanding notesNotes pursuant to a Change of Control offer,Offer, Titan expects that it would seek third party financing to the extent it does not have available funds to meet its purchase obligations. However, there can be no assurance that Titan would be able to obtain such financing. Neither Titan’s Board of Directors nor the Trustee may waive the covenant relating to a holder’s right to repurchase upon the occurrence of a Change of Control. Restrictions in the Indenture described in this prospectus on the ability of Titan and its subsidiaries to incur additional Indebtedness, to grant Liens on their property, to make Restricted Payments and to make Asset Sales may also make more difficult or discourage a takeover of Titan, whether favored or opposed by management. Consummation of any such transaction in certain circumstances may require the redemption or repurchase of notes,Notes, and Titan cannot assure you that Titan or the acquiroracquirer will have sufficient financial resources to effect such a redemption or repurchase. Such restrictions and the restrictions on transactions with Affiliates may, in certain circumstances, make more difficult or discourage a leveraged buyout of Titan or any of its subsidiaries by management. While such restrictions cover a wide variety of arrangements which
39
have traditionally been used to effect highly leveraged transactions, the Indenture may not afford the holders protection in all circumstances from the adverse aspects of a highly leveraged reorganization, restructuring, merger or similar transaction. The definition of Change of Control includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of “all or substantially all” of the properties or assets of Titan and its Restricted Subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase “substantially all,” there is no precise established definition of the phrase under applicable law. Accordingly, the ability of a holder of notes to require Titan to repurchase its notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of Titan and its Restricted Subsidiaries taken as a whole to another Person or group may be uncertain.
(a) Titan will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale of any Collateral unless: (1) Titan (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the Fair Market Value of the Collateral sold or otherwise disposed of; (2) the Fair Market Value is set forth in an Officers’ Certificateofficers’ certificate delivered to the Trustee; (3) at least 75% of the consideration received in the Asset Sale of the Collateral by Titan or such Restricted Subsidiary is in the form of cash, Cash Equivalents, common stock, notes receivable or Permitted Assets constituting Collateral or a combination thereof. For purposes of this provision, each of the following will be deemed to be cash: (a) any liabilities, as shown on Titan’s or such Restricted Subsidiary’s most recent balance sheet, of Titan or any Restricted Subsidiary (other than contingent liabilities, liabilities that are by their terms subordinated to the notesNotes or any Note Guarantee and liabilities to the extent ownedowed to Titan or any Restricted Subsidiary of Titan) that are assumed by the transferee of any such assets pursuant to a written novation agreement that releases Titan or such Restricted Subsidiary from further liability; and (b) any securities, notes or other obligations received by Titan or any such Restricted Subsidiary from such transferee that within 180 days are converted by Titan or such Restricted Subsidiary into cash, to the extent of the cash received in that conversion; and (4) the consideration received from such Asset Sale is concurrently added to the Collateral securing the notes. Notes.Within 365 days after the receipt of any Net Proceeds from an Asset Sale of Collateral, Titan or the applicable Restricted Subsidiary may apply those Net Proceeds to make a capital expenditure on Permitted Assets constituting Collateral; providedthat, a binding commitment shall be treated as a permitted application of the Net Proceeds from the date of such commitment so long as such commitment requires that such Net Proceeds will be applied to satisfy such commitment within 180 days of such commitment and such commitment is not terminated or abandoned. Pending the final application of any Net Proceeds, Titan may temporarily invest the Net Proceeds in any manner that is not prohibited by the Indenture. Any Net Proceeds from Asset Sales that are not applied or invested as provided in the preceding paragraph will constitute “Collateral Excess Proceeds.” When the aggregate amount of Collateral Excess Proceeds exceeds $25.0 million, or, at Titan’s option, earlier, Titan will make an Asset Sale Offer to all Holders of notesNotes in an amount equal to the Fair Market Value of the Collateral Excess Proceeds. The offer price in any Asset Sale Offer will be equal to 100% of principal amount plus accrued and unpaid interest to the date of purchase (subject to the rights of Holders of record on the relevant record date to receive interest payable on the relevant interest payment date), and will be payable in cash. If any Collateral Excess Proceeds remain after consummation of an Asset Sale Offer, Titan may use those Collateral Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If the
40
aggregate principal amount of notesNotes tendered into such Asset Sale Offer exceeds the amount equal to the Fair Market Value of the Collateral Excess Proceeds, the Trustee will select the notesNotes and such other Parity Lien Debt to be purchased on apro rata basis. Upon completion of each Asset Sale Offer, the amount of Collateral Excess Proceeds will be reset at zero. (b) Titan will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale (other than an Asset Sale of Collateral) unless: (1) Titan (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of; and (2) at least 75% of the consideration received in the Asset Sale by Titan or such Restricted Subsidiary is in the form of cash or Cash Equivalents, common stock or notes receivable. For purposes of this clause (2) (and not for purposes of determining the Net Proceeds received from the Asset Sale), each of the following will be deemed to be cash: (a) any liabilities, as shown on Titan’s most recent consolidated balance sheet, of Titan or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the notesNotes or any Note Guarantee) that are assumed by the transferee of any such assets pursuant to a written novation agreement that releases Titan or such Restricted Subsidiary from further liability; (b) any securities, notes or other obligations received by Titan or any such Restricted Subsidiary from such transferee that are within 180 days of the receipt thereof converted by Titan or such Restricted Subsidiary into cash, to the extent of the cash received in that conversion; (c) any stock or assets of the kind referred to in clause (2) or (4) of the next paragraph of this covenant; and (d) any Designated Noncash Consideration received by Titan or any of its Restricted Subsidiaries in such Asset Sale having a Fair Market Value, taken together with all other Designated Noncash Consideration received pursuant to this clause (d) that is at that time outstanding, not to exceed 10.0% of Consolidated Net Tangible Assets at the time of receipt of such Designated Noncash Consideration (with the Fair Market Value of each item of Designated Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value). Within 365 days after the receipt of any Net Proceeds from an Asset Sale, Titan (or the applicable Restricted Subsidiary, as the case may be) may apply such Net Proceeds: (1) to repay Indebtedness and other Obligations under a Credit Facility and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments with respect thereto; (2) to acquire Business Assets or all or substantially all of the assets of, or any Capital Stock of, another Permitted Business, if, after giving effect to any such acquisition of Business Assets or Capital Stock, the Business Assets will be held by, or the Permitted Business is or becomes, a Restricted Subsidiary of Titan; (3) to make a capital expenditure; or (4) to acquire other assets that are not classified as current assets under GAAP and that are used or useful in a Permitted Business; provided,,however,, that if, during such365-day period, Titanand/or any of its Restricted Subsidiaries enters into a binding written contract with a Person other than an Affiliate of Titan to apply such amount pursuant to clause (2) or (3) above, then such365-day period shall be extended until the earlier of (a) the date on which such acquisition or expenditure is consummated and (b) the 180th day following the expiration of the aforementioned365-day period. Pending the final application of any Net Proceeds, Titan may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by the Indenture.
41
Any Net Proceeds from Asset Sales that are not applied or invested as provided in the second paragraph of this covenant will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $25.0 million, within twenty days thereof, Titan will make an Asset Sale Offer to all holders of notesNotes and all holders of other Indebtedness that ispari passuwith the notesNotes containing provisions similar to those set forth in the Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets to purchase the maximum principal amount of notesNotes and such otherpari passuIndebtedness that may be purchased out of the Excess Proceeds. The offer price in any Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest to the date of purchase and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, Titan may use those Excess Proceeds for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of notesNotes and otherpari passuIndebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee will select the notesNotes and such otherpari passuIndebtedness to be purchased on apro rata basis. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Titan will comply with the requirements ofRule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of notesNotes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of the Indenture, Titan will comply with the applicable securities laws and regulations and will be deemed not to have breached its obligations under the Asset Sale provisions of the Indenture by virtue of such compliance. The agreements governing Titan’s other Indebtedness contain, and future agreements may contain, prohibitions of certain events, including events that would constitute a Change of Control or an Asset Sale and including repurchases of or other prepayments in respect of the notes.Notes. The exercise by the holders of notesNotes of their right to require Titan to repurchase the notesNotes upon a Change of Control or an Asset Sale could cause a default under these other agreements, even if the Change of Control or Asset Sale itself does not, due to the financial effect of such repurchases on Titan. In the event a Change of Control or Asset Sale occurs at a time when Titan is prohibited from purchasing notes,Notes, Titan could seek the consent of its relevant lenders to the purchase of notesNotes or could attempt to refinance the borrowings that contain such prohibition. If Titan does not obtain a consent or repay those borrowings, Titan will remain prohibited from purchasing notes.Notes. In that case, Titan’s failure to purchase tendered notesNotes would constitute an Event of Default under the Indenture which could, in turn, constitute a default under the other indebtedness. Finally, Titan’s ability to pay cash to the holders of notesNotes upon a repurchase may be limited by Titan’s then existing financial resources. (c) Titan will not, and will not permit any Guarantor to, transfer any interest in the Collateral to any other Subsidiary. If less than all of the notesNotes are to be redeemed at any time, the Trustee will select notesNotes for redemption on apro ratabasis unless otherwise required by law or applicable stock exchange requirements. No notesNotes of $2,000 or less can be redeemed in part. Notices of redemption will be mailed by first class mail at least 30 but not more than 60 days before the redemption date to each holder of notesNotes to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the notesNotes or a satisfaction and discharge of the Indenture. Notices of redemption may not be conditional. If any notesNote is to be redeemed in part only, the notice of redemption that relates to that notesNote will state the portion of the principal amount of that notesNote that is to be redeemed. A new note in principal amount equal to the unredeemed portion of the original notesNote will be issued in the name of the holder of notesNotes upon cancellation of the original notes.Note;provided that each new note issued will be in a principal amount of $2,000 or integral multiples of $1,000 increments thereof. Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on notesNotes or portions of notesNotes called for redemption.
42
Certain Covenants Titan will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly: (1) declare or pay any dividend or make any other payment or distribution on account of Titan’s or any of its Restricted Subsidiaries’ Equity Interests (including, without limitation, any payment in connection with any merger or consolidation involving Titan or any of its Restricted Subsidiaries) or to the direct or indirect holders of Titan’s or any of its Restricted Subsidiaries’ Equity Interests in their capacity as such (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of Titan and other than dividends or distributions payable to Titan or a Restricted Subsidiary of Titan); (2) purchase, redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving Titan) any Equity Interests of Titan or any direct or indirect parent of Titan; (3) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Indebtedness of Titan or any Guarantor that is contractually subordinated to the notesNotes or to any Note Guarantee (excluding any intercompany Indebtedness between or among Titan and any of its Restricted Subsidiaries and excluding the payment, repurchase, redemption, defeasance or other acquisition or retirement of such subordinated Indebtedness in anticipation of or in connection with a payment of principal or interest at the Stated Maturity thereof, in each case due within three months of the date of such payment, redemption, repurchase, defeasance, acquisition or retirement); or (4) make any Restricted Investment (all such payments and other actions set forth in these clauses (1) through (4) above being collectively referred to as “Restricted Payments”), unless, at the time of and after giving effect to such Restricted Payment: (1) no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment; (2) Titan would, at the time of such Restricted Payment and after givingpro formaforma effect thereto as if such Restricted Payment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described below under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock;”Stock”; and (3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by Titan and its Restricted Subsidiaries since January 1, 20102013 (excluding Restricted Payments permitted by clauses (2), (3), (4), (6) and (6)(12) of the next succeeding paragraph), is less than the sum, without duplication, of: (a) 50% of the Consolidated Net Income of Titan for the period (taken as one accounting period) from January 1, 20102013 to the end of Titan’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if such Consolidated Net Income for such period is a deficit, less 100% of such deficit);plus (b) 100% of the aggregate net cash proceeds received by Titan since January 1, 20102013 as a contribution to its common equity capital or from the issue or sale of Equity Interests of Titan (other than Disqualified Stock) or from the issue or sale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of Titan that have been converted into or exchanged for such Equity Interests (other than Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary of Titan);plus (c) to the extent that any Restricted Investment that was made after January 1, 20102013 is sold for cash or otherwise liquidated or repaid for cash, the lesser of (i) the cash return of capital with respect to such
43
Restricted Investment (less the cost of disposition, if any) and (ii) the initial amount of such Restricted Investment;plus (d) 100% of the aggregate net cash proceeds received by Titan or a Restricted Subsidiary since January 1, 20102013 from the sale (other than to Titan or a Restricted Subsidiary) of Equity Interests of an Unrestricted Subsidiary;plus (e) to the extent that any Unrestricted Subsidiary of Titan is redesignated as a Restricted Subsidiary, the lesser of (i) the Fair Market Value of Titan’s Investment in such Subsidiary as of the date of such redesignation or (ii) such Fair Market Value as of the date on which such Subsidiary was originally designated as an Unrestricted Subsidiary;plus (f) 50% of any dividends received by Titan or a Restricted Subsidiary of Titan that is a Guarantor from an Unrestricted Subsidiary of Titan, to the extent that such dividends were not otherwise included in the Consolidated Net Income of Titan for such period;plus As of December 31, 2013, we had at least $130 million available to make Restricted Payments under clause (3) of the immediately preceding paragraph above. So long as no Default has occurred and is continuing or would be caused thereby, the preceding provisions will not prohibit: (1) the payment of any dividend or the consummation of any irrevocable redemption within 60 days after the date of declaration of the dividend or giving of the redemption notice, as the case may be, if at the date of declaration or notice, the dividend or redemption payment would have complied with the provisions of the Indenture; (2) the making of any Restricted Payment in exchange for, or out of the net cash proceeds of the substantially concurrent sale (other than to a Subsidiary of Titan) of, Equity Interests of Titan (other than Disqualified Stock) or from the substantially concurrent contribution of common equity capital to Titan;providedthat the amount of any such net cash proceeds that are utilized for any such Restricted Payment will be excluded from clause (3)(b) of the preceding paragraph; (3) the repurchase, redemption, defeasance or other acquisition or retirement for value of Indebtedness of Titan or any Guarantor that is contractually subordinated to the notesNotes or to any Note Guarantee with the net cash proceeds from a substantially concurrent incurrence of Permitted Refinancing Indebtedness; (4) the payment of any dividend (or, in the case of any Person other than a corporation, any similar distribution) by a Restricted Subsidiary of Titan to the holders of its Equity Interests on apro ratabasis; (5) the payment of any dividend by Titan to the holders of its Equity Interests in an amount not to exceed $3.0 million in any twelve-month period; (6) the repurchase of Equity Interests deemed to occur upon the exercise of stock options to the extent such Equity Interests represent a portion of the exercise price of those stock options; (7) the payment of cash in lieu of fractional Equity Interests pursuant to the exchange or conversion of any exchangeable or convertible securities;provided, that such payment shall not be for the purpose of evading the limitations of this covenant (as determined by the Board of Directors of Titan in good faith); (8) payments or distributions to dissenting shareholders pursuant to applicable law, pursuant to or in connection with a consolidation, merger or transfer of assets that complies with the provisions of the Indenture applicable to mergers, consolidations and transfers of all or substantially all of the property and assets of Titan; (9) the declaration and payment of regularly scheduled or accrued dividends to holders of any class or series of Disqualified Stock of Titan or any Restricted Subsidiary of Titan issued on or after the Issue Date in accordance with the Fixed Charge Coverage Ratio test described below under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock;” Stock”;(10) upon the occurrence of a Change of Control or an Asset Sale, the defeasance, redemption, repurchase or other acquisition of any subordinated Indebtedness pursuant to provisions substantially similar
44
to those described above under the captions “—Repurchase at the Option of Holders — Holders—Change of Control” and “— Repurchase at the Option of Holders — Holders—Asset Sales” at an offer price not greater than 101% of the principal amount thereof (in the case of a Change of Control) or at a percentage of the principal amount thereof not higher than the principal amount applicable to the notesNotes (in the case of an Asset Sale), plus any accrued and unpaid interest thereon;providedthat prior to such defeasance, redemption, repurchase or other acquisition, Titan has made a Change of Control Offer or Asset Sale Offer, as applicable, with respect to the notesNotes and has repurchased all notesNotes validly tendered for payment and not withdrawn in connection therewith; and (11) other Restricted Payments (which shall be in addition to, and not aggregated with, any other Restricted Payments permitted by any other provisions of the Indenture or any Permitted Investments), when taken together with all other Restricted Payments made pursuant to this clause (11), in an aggregate amount not to exceed $50.0 million since the Issue Date. Date; and(12) the repurchase, redemption, defeasance or other acquisition or retirement for value of the existing 2017 Notes. The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by Titan or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The Fair Market Value of any assets or securities that are required to be valued by this covenant exceeding $30.0 million will be determined by the Board of Directors of Titan whose good faith determination shall be conclusive and whose resolution with respect thereto will be delivered to the Trustee. The Board of Directors’ determination must be based upon an opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing if the Fair Market Value exceeds $30.0 million. Incurrence of Indebtedness and Issuance of Preferred Stock Titan will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt), and Titan will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock;provided, however,, that Titan may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, and the Guarantors may incur Indebtedness (including Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for Titan’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or such preferred stock is issued, as the case may be, would have been at least 2.02.00 to 1.0,1.00, determined on apro forma basis (including apro forma application of the net proceeds therefrom), as if the additional Indebtedness had been incurred or the Disqualified Stock or the preferred stock had been issued, as the case may be, at the beginning of such four-quarter period. The first paragraph of this covenant will not prohibit the incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”): (1) in addition to Indebtedness incurred pursuant to clauses (2) through (14)(15), the incurrence by Titan and its Restricted Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of Titan and its Restricted Subsidiaries thereunder) not to exceed the greater of (a) $350.0 million and (b) the amount of the Borrowing Base; (2) the incurrence by Titan and its Restricted Subsidiaries of the Existing Indebtedness; (3) the incurrence by Titan and the Guarantors of Indebtedness represented by the notesNotes and the related Note Guarantees to be issued on the Issue Date and the exchange notesExchange Notes and the related Guarantees to be issued under the exchange and registration rights agreement; (4) the incurrence by Titan or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of design, construction, installation or improvement of property, plant or equipment used in the business of Titan or any of its Restricted Subsidiaries, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance,
45
replace, defease or discharge any Indebtedness incurred pursuant to this clause (4), not to exceed $50.0 million outstanding at any time; (5) the incurrence by Titan or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge any Indebtedness (other than intercompany Indebtedness) that was permitted by the Indenture to be incurred under the first paragraph of this covenant or clause (2), (3), (4), (5) or (13) of this paragraph; (6) the incurrence by Titan or any of its Restricted Subsidiaries of intercompany Indebtedness between or among Titan and any of its Wholly-Owned Restricted Subsidiaries;provided,,however,, that: (a) if Titan or any Guarantor is the obligor on such Indebtedness and the payee is not Titan or a Guarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations then due with respect to the notes,Notes, in the case of Titan, or the applicable Note Guarantee, in the case of a Guarantor; and (b) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by a Person other than Titan or a Wholly-Owned Restricted Subsidiary of Titan and (ii) any sale or other transfer of any such Indebtedness to a Person that is not either Titan or a Wholly-Owned Restricted Subsidiary of Titan, will be deemed, in each case, to constitute an incurrence of such Indebtedness by Titan or such Restricted Subsidiary, as the case may be, that was not permitted by this clause (6); (7) the issuance by any of Titan’s Restricted Subsidiaries to Titan or to any of its Wholly-Owned Restricted Subsidiaries of shares of preferred stock;provided,,however,, that: (a) any subsequent issuance or transfer of Equity Interests that results in any such preferred stock being held by a Person other than Titan or a Wholly-Owned Restricted Subsidiary of Titan; and (b) any sale or other transfer of any such preferred stock to a Person that is not either Titan or a Wholly-Owned Restricted Subsidiary of Titan, will be deemed, in each case, to constitute an issuance of such preferred stock by such Restricted Subsidiary that was not permitted by this clause (7); (8) the incurrence by Titan or any of its Restricted Subsidiaries of Hedging Obligations in the normal course of business; (9) the guarantee by Titan or any of the Guarantors of Indebtedness of Titan or a Restricted Subsidiary of Titan that was permitted to be incurred by another provision of this covenant;providedthat if the Indebtedness being guaranteed is subordinated to orpari passuwith the notes,Notes, then the Guarantee shall be subordinated orpari passu,, as applicable, to the notes,Notes, to the same extent as the Indebtedness guaranteed; (10) the incurrence by Titan or any of its Restricted Subsidiaries of Indebtedness in respect of performance bonds, bankers’ acceptances, workers’ compensation claims, surety or appeal bonds, payment obligations in connection with self-insurance or similar obligations, and bank overdrafts in the normal course of business; (11) the incurrence by Titan or any of its Restricted Subsidiaries of Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn against insufficient funds, so long as such Indebtedness is repaid within five business days; (12) Indebtedness of (a) Titan or a Restricted Subsidiary of Titan to the extent such Indebtedness was Indebtedness of a Person that was merged, consolidated or amalgamated into Titan or such Restricted Subsidiary of Titan or (b) a Restricted Subsidiary that was incurred and outstanding prior to the date on which such Restricted Subsidiary was acquired by Titan or a Restricted Subsidiary of Titan, in each case, other thanincluding any Indebtedness incurred in contemplation of, or in connection with, the transaction or series of related transactions pursuant to which such Person was merged, consolidated or otherwise acquired by Titan or a Restricted Subsidiary of Titan;provided,,however,, that for any such Indebtedness outstanding at any time
46
under this clause (12), after givingpro forma effect thereto on the date of such acquisition, merger, consolidation or amalgamation, either (A) Titan or such Restricted Subsidiary would have been able to incur $1.00 of additional Indebtedness pursuant to the first paragraph of this covenant or (B) the Fixed Charge Coverage Ratio for Titan or such Restricted Subsidiary, as applicable, would be greater than the Fixed Charge Coverage Ratio for Titan immediately prior to such transaction; (13) the incurrence by Titan or any Restricted Subsidiary of Indebtedness arising from agreements of Titan or any Restricted Subsidiary providing for indemnification, adjustment of purchase price, “earn out” or similar obligations, in each case, incurred in connection with the acquisition or disposition of assets, including shares of Capital Stock, in accordance with the terms of the Indenture; and (14) the incurrence by Titan or any of its Restricted Subsidiaries of additional Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (14), not to exceed $50.0$100.0 million; and (15) the incurrence by Foreign Subsidiaries of Indebtedness in an aggregate principal amount at any time outstanding, including all Permitted Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to this clause (15), not to exceed $150.0 million. Titan will not incur, and will not permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that is contractually subordinated in right of payment to any other Indebtedness of Titan or such Guarantor unless such Indebtedness is also contractually subordinated in right of payment to the notesNotes and the applicable Note Guarantee on substantially identical terms;provided,,however,, that no Indebtedness will be deemed to be contractually subordinated in right of payment to any other Indebtedness of Titan solely by virtue of being unsecured or by virtue of being secured on a first or junior Lien basis. For purposes of determining compliance with this “Incurrence“—Incurrence of Indebtedness and Issuance of Preferred Stock” covenant, in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through (14) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, Titan will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or a portion of such item of Indebtedness, in any manner that complies with this covenant. Indebtedness under Credit Facilities outstanding on the date on which notesNotes are first issued and authenticated under the Indenture will initially be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of Permitted Debt. The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, the reclassification of preferred stock as Indebtedness due to a change in accounting principles, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock will not be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant;provided,, in each such case, that the amount of any such accrual, accretion or payment is included inas Fixed Charges of Titan as accrued. Notwithstanding any other provision of this covenant, the maximum amount of Indebtedness that Titan or any Restricted Subsidiary may incur pursuant to this covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values. The amount of any Indebtedness outstanding as of any date will be: (1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount; (2) the principal amount of the Indebtedness, in the case of any other Indebtedness; and (3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of: (a) the Fair Market Value of such assets at the date of determination; and (b) the amount of the Indebtedness of the other Person. Notwithstanding the foregoing, (i) all Indebtedness outstanding on the Issue Date will be permitted and (ii) Titan will be permitted to issue shares of its common stock.
47
LiensLiens
Titan will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, assume or suffer to exist any Lien of any kind on any asset now owned or hereafter acquired, except Permitted Liens. Dividend and Other Payment Restrictions Affecting Subsidiaries Titan will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to: (1) pay dividends or make any other distributions on its Capital Stock to Titan or any of its Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or pay any indebtedness owed to Titan or any of its Restricted Subsidiaries; (2) make loans or advances to Titan or any of its Restricted Subsidiaries; or (3) sell, lease or transfer any of its properties or assets to Titan or any of its Restricted Subsidiaries. However, the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of: (1) agreements governing Existing Indebtedness and Credit Facilities as in effect on the Issue Date and any amendments, restatements, modifications, renewals, supplements, refundings, replacements or refinancings of those agreements;providedthat theany such amendments, restatements, modifications, renewals, supplements, refundings, replacements or refinancings are not materially more restrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreements on the Issue Date, as determined in good faith by Titan’s Board of Directors; (2) the Indenture, the notesNotes and the Note Guarantees; (3) applicable law, rule, regulation or order; (4) any instrument governing Indebtedness or Capital Stock of a Person acquired by Titan or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock was incurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired; (5) non-assignment or change in control provisions in contracts and licenses entered into in the normal course of business; (6) purchase money obligations for property acquired in the normal course of business and Capital Lease Obligations that impose restrictions on the property purchased or leased of the nature described in clause (3) of the preceding paragraph; (7) any restriction imposed under an agreement for the sale or other disposition of assets or Equity Interests pending the sale or other disposition; (8) Permitted Refinancing Indebtedness;providedthat the restrictions contained in the agreements governing such Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced, as determined in good faith by Titan’s Board of Directors; (9) Liens permitted to be incurred under the provisions of the covenant described above under the caption “—Liens” that limit the right of the debtor to dispose of the assets subject to such Liens; (10) provisions limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements, sale-leaseback agreements, stock sale agreements and other similar agreements entered into in the normal course of business or with the approval of Titan’s Board of Directors, which limitation is applicable only to the assets that are the subject of such agreements;
48
(11) the license of any intellectual property of Titan or any of its Restricted Subsidiaries entered into in the normal course of business; (12) the release, waiver or novation of contractual, indemnification, or any other legal rights entered into in the normal course of business; and (13) restrictions on cash, Cash Equivalents or other deposits or net worth imposed by customers under contracts entered into in the normal course of business. business; and(14) other Indebtedness (including, Permitted Refinancing Indebtedness) of any Restricted Subsidiary of Titan permitted to be incurred pursuant to an agreement entered into subsequent to the Issue Date in accordance with the covenant described under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock”;provided that either (A) the provisions relating to such encumbrance or restriction contained in such Indebtedness are not materially less favorable to Titan, taken as a whole, as determined by Titan in good faith, than the provisions contained in the Credit Agreement or in the Indenture, in each case, as in effect on the Issue Date or (B) any encumbrance or restriction contained in such Indebtedness does not materially affect, as determined by Titan in good faith, Titan’s ability to make scheduled payments of principal and interest on the Notes when due. Merger, Consolidation or Sale of Assets Titan will not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not Titan is the surviving corporation); or (2) sell, assign, transfer, convey or otherwise dispose of all or substantially all of the properties or assets of Titan and its Restricted Subsidiaries taken as a whole, in one or more related transactions, to another Person, unless: (1) either: (a) Titan is the surviving corporation; or (b) the Person formed by or surviving any such consolidation or merger (if other than Titan) or to which such sale, assignment, transfer, conveyance or other disposition has been made is a corporation organized or existing under the laws of the United States, any state of the United States or the District of Columbia; (2) the Person formed by or surviving any such consolidation or merger (if other than Titan) or the Person to which such sale, assignment, transfer, conveyance or other disposition has been made assumes all the obligations of Titan under the notes,Notes, the Indenture and pursuant to agreements reasonably satisfactory to the Trustee; (3) immediately after such transaction, no Default or Event of Default exists; and (4) either: (a) Titan or the Person formed by or surviving any such consolidation or merger (if other than Titan), or to which such sale, assignment, transfer, conveyance or other disposition has been made would, on the date of such transaction after givingpro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant described above under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock;” or (b) the Fixed Charge Coverage Ratio for Titan or the Person formed by or surviving any such consolidation or merger, or to which such sale, assignment, transfer, conveyance or other disposition has been made would (if other than Titan), on the date of such transaction after givingpro forma effect thereto and any related financing transactions as if the same had occurred at the beginning of the applicable four-quarter period, be greater than the Fixed Charge Coverage Ratio for Titan immediately prior to such transaction. This “Merger,“—Merger, Consolidation or Sale of Assets” covenant will not apply to: (1) a merger of Titan with an Affiliate solely for the purpose of reincorporating Titan in another jurisdiction; or (2) any consolidation or merger, or any sale, assignment, transfer, conveyance, lease or other disposition of assets between or among Titan and its Restricted Subsidiaries. Transactions with Affiliates Titan will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate of Titan (each, an “Affiliate Transaction”), unless: (1) the Affiliate Transaction is on terms that are no less favorable to Titan or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by Titan or such Restricted Subsidiary with an unrelated Person; and
49
(2) Titan delivers to the Trustee: (a) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $30.0 million, a resolution of the Board of Directors of Titan set forth in an officers’ certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction has been approved by a majority of the disinterested members of the Board of Directors of Titan; and (b) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $30.0 million, an opinion as to the fairness to Titan or such Subsidiary of such Affiliate Transaction from a financial point of view issued by an accounting, appraisal or investment banking firm of national standing. The following items will be deemed not to be Affiliate Transactions and, therefore, will not be subject to the provisions of the prior paragraph: (1) any employment, compensation, benefit or indemnification agreement or arrangement (and any payments or other transactions pursuant thereto) entered into by Titan or any of its Restricted Subsidiaries in the normal course of business with an officer, employee, consultant or director and any transactions pursuant to stock option plans, stock ownership plans and employee benefit plans or arrangements; (2) transactions between or among Titanand/or its Restricted Subsidiaries; (3) transactions with a Person (other than an Unrestricted Subsidiary of Titan) that is an Affiliate of Titan solely because Titan owns, directly or through a Restricted Subsidiary, an Equity Interest in, or controls, such Person; (4) payment of reasonable directors’ fees to Persons who are not otherwise Affiliates of Titan; (5) any issuance of common stock (other than Disqualified Stock) of Titan to Affiliates of Titan; (6) any agreement of Titan or any Affiliate as in effect as of the Issue Date and described in this prospectusthe offering circular dated September 26, 2013 relating to the issuance of the Outstanding Notes or any amendment thereto or any replacement agreement, or any transaction pursuant to or contemplated by any such agreement, amendment or replacement, so long as any such amendment or replacement agreement, taken as a whole, is not more disadvantageous to Titan or the holders of the notesNotes in any material respect than the original agreement as in effect on the Issue Date; (7) Restricted Payments that do not violate the provisions of the Indenture described above under the caption “—Restricted Payments;”Payments” or any Permitted Investment in a Person that is an Affiliate solely as a result of Titan’s or its Restricted Subsidiaries’ Investments in such Person; and (8) loans or advances to officers, employees, consultants or directors not to exceed $2.0 million in the aggregate at any one time outstanding. Titan will not, and will not permit any of its Restricted Subsidiaries to, engage in any business other than Permitted Businesses, except to such extent as would not be material to Titan and its Restricted Subsidiaries taken as a whole. Designation of Restricted and Unrestricted Subsidiaries The Board of Directors of Titan may designate any Restricted Subsidiary that does not own any interest in the Collateral to be an Unrestricted Subsidiary if that designation would not cause a Default. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate Fair Market Value of all outstanding Investments owned by Titan and its Restricted Subsidiaries in the Subsidiary designated as an Unrestricted Subsidiary will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under the covenant described above under the caption “—Restricted Payments” or under one or more clauses of the definition of Permitted Investments, as determined by Titan. That designation will only be permitted
50
if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. Any designation of a Subsidiary of Titan as an Unrestricted Subsidiary will be evidenced to the Trustee by filing with the trusteeTrustee a certified copy of a resolution of the Board of Directors giving effect to such designation and an officers’ certificate certifying that such designation complied with the preceding conditions and was permitted by the covenant described above under the caption “—Restricted Payments.” If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of the Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of Titan as of such date and, if such Indebtedness is not permitted to be incurred as of such date under the covenant described under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock,” Titan will be in default of such covenant. The Board of Directors of Titan may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary of Titan;providedthat such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of Titan of any outstanding Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (1) such Indebtedness is permitted under the covenant described under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock,” calculated on apro forma basis as if such designation had occurred at the beginning of the four-quarter reference period; and (2) no Default or Event of Default would be in existence following such designation. Impairment of Security Interest Titan will not, and will not permit any of its Restricted Subsidiaries to, take or knowingly or negligently omit to take, any action which action or omission would or could reasonably be expected to have the result of materially impairing the security interest with respect to the Collateral for the benefit of the Collateral Trustee and the Holders of the notes,holders, subject to limited exceptions. Titan shall not amend, modify or supplement, or permit or consent to any amendment, modification or supplement of, the Security Documents in any way that would be adverse to the Holders of the notesholders in any material respect, except as described under “—Security for the Notes” or as permitted under “—Amendment, Supplement and Waiver.” Limitation on Sale and Leaseback Transactions Titan will not, and will not permit any of its Restricted Subsidiaries to, enter into any sale and leaseback transaction;providedthat Titan or any Restricted Subsidiary may enter into a sale and leaseback transaction if: (1) Titan or that Restricted Subsidiary, as applicable, could have (a) incurred Indebtedness in an amount equal to the Attributable Debt relating to such sale and leaseback transaction under the Fixed Charge Coverage Ratio test in the first paragraph of the covenant described above under the caption “—Incurrence of Indebtedness and Issuance of Preferred Stock” and (b) incurred a Lien (on the property that is the subject of such sale and leaseback transaction) to secure such Indebtedness pursuant to the covenant described above under the caption “— Liens;” Liens”;(2) the gross cash proceeds of that sale and leaseback transaction are at least equal to the Fair Market Value, as determined in good faith by the Board of Directors of Titan and set forth in an officers’ certificate delivered to the Trustee, of the property that is the subject of that sale and leaseback transaction; and (3) the transfer of assets in that sale and leaseback transaction is permitted by, and Titan applies the proceeds of such transaction in compliance with, the covenant described above under the caption “—Repurchase at the Option of Holders — Holders—Asset Sales.” Titan will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any holder of notesNotes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of the Indenture or the notesNotes unless such consideration is offered to be paid and is paid to all holders of the notesNotes that consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.
51
Notwithstanding the foregoing, in any offer or payment of consideration for, or as an inducement to, any consent, waiver or amendment of any of the terms or provisions of the Indenture or the notesNotes in connection with an exchange offer, Titan and any of its Restricted Subsidiaries may exclude (i) holders or beneficial owners of the notesNotes that are not institutional “accredited investors” as defined in subparagraphs (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act, and (ii) holders or beneficial owners of the notesNotes in any jurisdiction where the inclusion of such holders or beneficial owners would require Titan or any such Restricted Subsidiaries to comply with the registration requirements or other similar requirements under any securities laws of such jurisdiction, or the solicitation of such consent, waiver or amendment from, or the granting of such consent or waiver, or the approval of such amendment by, holders or beneficial owners in such jurisdiction would be unlawful, in each case as determined by Titan in its sole discretion. Notwithstanding that Titan may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, Titan will file with the SEC and provide the Trustee and holders and prospective holders (upon written request) within 15 days after it files them with the SEC, copies of its annual report and the information, documents and other reports that are specified in Sections 13 and 15(d) of the Exchange Act. In addition, Titan shall furnish to the Trustee and, upon request, the holders and prospective holders, promptly upon their becoming available, copies of the annual report to shareholders provided by Titan to its public shareholders generally. Titan also will comply with the other provisions of Section 314(a) of the Trust Indenture Act of 1939, as amended. Act.In addition, Titan shall furnish to noteholders, prospective investors, broker-dealers and securities analysts, upon their written request, the information referred to in Rule 144A(d)(4) under the Securities Act so long as the notesNotes are not freely transferable under the Securities Act. Notwithstanding the foregoing, Titan will be deemed to have furnished such reports referred to above to the Trustee, the holders and prospective holders if Titan has filed such reports and information with the CommissionSEC via the EDGAR filing system. Titan and the Guarantors shall execute all further documents, agreements and instruments, and take further action that may be required under applicable law, or that the Trustee or the Collateral Trustee may reasonably request, in order to grant, preserve, protect and perfect the validity and priority of the security interests created or intended to be created by the Security Documents in the Collateral. In addition, from time to time, Titan will reasonably promptly secure the obligations under the Indenture and the Security Documents by mortgaging or creating, or causing to be mortgaged or created, perfected security interests with respect to the Collateral. Such security interests and Liens will be created under the Security Documents and other security agreements, mortgages, deeds of trust and other instruments and documents in form and substance. Events of Default and Remedies With respect to the notes,Notes, each of the following is an “Event of Default”: (1) default for 30 days in the payment when due of interest on the notes; Notes;(2) default in the payment when due (at maturity, upon redemption or otherwise) of the principal of, or premium, if any, on, the notes; Notes;(3) failure by Titan or any of its Restricted Subsidiaries to comply with the provisions described under the captions “—Repurchase at the Option of Holders — Holders—Change of Control,” “—Repurchase at the Option of Holders — Holders—Asset Sales,” “— Certain Covenants — Restricted Payments,” “— Certain Covenants — Incurrence of Indebtedness and Issuance of Preferred Stock”Sales” or “—Certain Covenants — Covenants—Merger, Consolidation or Sale of Assets;”
52
Assets”;
(4) failure by Titan or any of its Restricted Subsidiaries for 60 days after notice to Titan by the Trustee or the holders of at least 25% in aggregate principal amount of the notesNotes then outstanding voting as a single class to comply with any of the other agreements in the Indenture; (5) default under any mortgage, Indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by Titan or any of its Restricted Subsidiaries (or the payment of which is guaranteed by Titan or any of its Restricted Subsidiaries), whether such Indebtedness or Guarantee now exists, or is created after the Issue Date, if that default: (a) is caused by a failure to pay principal of, or interest or premium, if any, on, such Indebtedness prior to the expiration of the grace period provided in such Indebtedness on the date of such default (a “Payment Default”); or (b) results in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $30.0 million or more; (6) failure by Titan or any of its Restricted Subsidiaries to pay final judgments entered by a court or courts of competent jurisdiction aggregating in excess of $30.0 million, which judgments are not paid, discharged or stayed for a period of 60 days; (7) certain events of bankruptcy or insolvency described in the Indenture with respect to Titan or any of its Restricted Subsidiaries that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary or any Guarantor; (8) any security interest or Lien purported to be created by any Security Document with respect to any Collateral having, individually or in the aggregate, a Fair Market Value in excess of $5.0 million (a) ceases to be in full force and effect, (b) ceases, other than through an act or omission of the Collateral Trustee, to give the Collateral Trustee, for the benefit of the Holders of the notes,holders, the Liens, rights, powers and privileges purported to be created and granted thereby (including a perfected first-priority security interest in and Lien on, all of the Collateral thereunder) in favor of the Collateral Trustee or (c) is asserted by Titan or any Guarantor not to be, a valid, perfected, first priority security interest in or Lien on the Collateral covered thereby; and (9) an “Event of Default” as defined in any Mortgage. In the case of an Event of Default arising from certain events of bankruptcy or insolvency, with respect to Titan, any Restricted Subsidiary of Titan that is a Significant Subsidiary or any group of Restricted Subsidiaries of Titan that, taken together, would constitute a Significant Subsidiary, all outstanding notesNotes will become due and payable immediately without further action or notice. If any other Event of Default occurs and is continuing, the Trustee or the holders of at least 25% in aggregate principal amount of the then outstanding notesNotes may declare all the notesNotes to be due and payable immediately. Subject to certain limitations, holders of a majority in aggregate principal amount of the then outstanding notesNotes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from holders of the notesNotes notice of any continuing Default or Event of Default if it determines that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal, interest or premium, if any. Subject to the provisions of the Indenture relating to the duties of the Trustee, in case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of any holders of notesNotes unless such holders have offered to the Trustee indemnity or security reasonably satisfactory to it against any loss, liability or expense. Except to enforce the right to receive payment of principal, premium, if any, or interest when due, no holder of a noteNote may pursue any remedy with respect to the Indenture or the notesNotes unless: (1) such holder has previously given the Trustee notice that an Event of Default is continuing; (2) holders of at least 25% in aggregate principal amount of the then outstanding notesNotes have requested the Trustee to pursue the remedy;
53
(3) such holders have offered the Trustee security or indemnity reasonably satisfactory to it against any loss, liability or expense; (4) the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity; and (5) holders of a majority in aggregate principal amount of the then outstanding notesNotes have not given the Trustee a direction inconsistent with such request within such60-day period. The holders of a majority in aggregate principal amount of the then outstanding notesNotes by notice to the Trustee may, on behalf of the holders of all of the notes,Notes, rescind an acceleration or waive any existing Default or Event of Default and its consequences under the Indenture except a continuing Default or Event of Default in the payment of interest or premium, if any, on, or the principal of, the notes. Notes.Titan is required to deliver to the Trustee annually a statement regarding compliance with the Indenture. Upon becoming aware of any Default or Event of Default, Titan is required to deliver to the Trustee a statement specifying such Default or Event of Default. No Personal Liability of Directors, Officers, Employees and Shareholders No director, officer, employee, incorporator or shareholder of Titan or any Guarantor, as such, will have any liability for any obligations of Titan or the Guarantors under the notes,Notes, the Indenture, the Note Guarantees or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each holder of notesNotes by accepting a noteNote waives and releases all such liability. The waiver and release are part of the consideration for issuance of the notes.Notes. The waiver may not be effective to waive liabilities under the federal securities laws. Legal Defeasance and Covenant Defeasance Titan may at any time, at the option of its Board of Directors evidenced by a resolution set forth in an officers’ certificate, elect to have all of its obligations discharged with respect to the outstanding notesNotes and all obligations of the Guarantors discharged with respect to their Note Guarantees (“Legal Defeasance”) except for: (1) the rights of holders of outstanding notesNotes to receive payments in respect of the principal of, or interest or premium, if any, on, such notesNotes when such payments are due from the trust referred to below; (2) Titan’s obligations with respect to the notesNotes concerning issuing temporary notes,Notes, registration of notes,Notes, mutilated, destroyed, lost or stolen notesNotes and the maintenance of an office or agency for payment and money for security payments held in trust; (3) the rights, powers, trusts, duties and immunities of the Trustee, and Titan’s and the Guarantors’ obligations in connection therewith; and (4) the Legal Defeasance and Covenant Defeasance provisions of the Indenture. In addition, with respect to the notes,Notes, Titan may, at its option and at any time, elect to have the obligations of Titan and the Guarantors released with respect to certain covenants (including its obligation to make Change of Control Offers and Asset Sale Offers) that are described in the Indenture (“Covenant Defeasance”) and thereafter any omission to comply with those covenants will not constitute a Default or Event of Default with respect to the notes.Notes. In the event Covenant Defeasance occurs, certain events (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events) described under “—Events of Default and Remedies” will no longer constitute an Event of Default with respect to the notes. Notes.In order to exercise either Legal Defeasance or Covenant Defeasance with respect to the notes: Notes:(1) Titan must irrevocably deposit, or cause to be deposited, with the Trustee, in trust, for the benefit of the holders of the notes,Notes, cash in U.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities, in amounts as will be sufficient, in the opinion of a nationally recognized investment bank, appraisal firm or firm of independent public accountants, to pay the principal of, or interest and premium, if any, on, the outstanding notesNotes on the stated date for payment thereof or
54
on the applicable redemption date, as the case may be, and Titan must specify whether the notesNotes are being defeased to such stated date for payment or to a particular redemption date; (2) in the case of Legal Defeasance, Titan must deliver to the Trustee an opinion of counsel reasonably acceptable to the Trustee confirming that (a) Titan has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the Issue Date, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel will confirm that, the holders of the outstanding notesNotes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred; (3) in the case of Covenant Defeasance, Titan must deliver to the Trustee an opinion of counsel reasonably acceptable to the Trustee confirming that the holders of the outstanding notesNotes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred; (4) no Default or Event of Default has occurred and is continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit) and the deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which Titan or any Guarantor is a party or by which Titan or any Guarantor is bound; ;(5) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under, any material agreement or instrument (other than the Indenture) to which Titan or any of its Subsidiaries is a party or by which Titan or any of its Subsidiaries is bound; (6) Titan must deliver to the Trustee an officers’ certificate stating that the deposit was not made by Titan with the intent of preferring the holders of notesNotes over the other creditors of Titan with the intent of defeating, hindering, delaying or defrauding any creditors of Titan or others; and (7) Titan must deliver to the Trustee an officers’ certificate and an opinion of counsel, each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with. Amendment, Supplement and Waiver Except as provided in the next two succeeding paragraphs, the Indenture or the notesNotes or the Note Guarantees may be amended or supplemented with the consent of the holders of at least a majority in aggregate principal amount of the notesNotes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, notes)Notes), and any existing Default or Event of Default or compliance with any provision of the Indenture or the notesNotes or the Note Guarantees may be waived with the consent of the holders of a majority in aggregate principal amount of the then outstanding notesNotes (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, notes)Notes). Without the consent of each holder of notesNotes affected, an amendment, supplement or waiver may not (with respect to any notesNotes held by a non-consenting holder): (1) reduce the principal amount of notesNotes whose holders must consent to an amendment, supplement or waiver; (2) reduce the principal of or changeamount payable upon the fixed maturityredemption of any note or alterchange the provisions withtime of any mandatory redemption or, in respect toof an optional redemption, the times at which any note may be redeemed or, once notice of redemption ofhas been given, the notes (other than provisions relating to the covenants described above under the caption “— Repurchasetime at the Option of Holders”); which it must thereupon be redeemed;(3) reduce the rate of or change the time for payment of interest, including default interest, on any note; Note;(4) waive a Default or Event of Default in the payment of principal of, or interest or premium, if any, on, the notesNotes (except a rescission of acceleration of the notesNotes by the holders of at least a majority in aggregate principal amount of the then outstanding notesNotes and a waiver of the payment default that resulted from such acceleration);
55
(5) make any note payable in money other than that stated in the notes; Notes;(6) make any change in the provisions of the Indenture relating to waivers of past Defaults or the rights of holders of notesNotes to receive payments of principal of, or interest or premium, if any, on, the notes; Notes;(7) waive a redemption payment with respect to any notesNote (other than a payment required by one of the covenants described above under the caption “—Repurchase at the Option of Holders”); (8) release any Guarantor from any of its obligations under its Note Guarantee or the Indenture, except in accordance with the terms of the Indenture; or (9) make any change in the preceding amendment and waiver provisions. In addition, any amendment to, or waiver of, the provisions of the Indenture or any Security Document that has the effect of (i) releasing any of the Collateral from the Liens securing the notesNotes or (ii) making any changes to the priority of the Liens created under the Security Documents that would adversely affect the Holders of the notesNotes will require the consent of the holders of at least 662/3% in aggregate principal amount of the notesNotes then outstanding. Notwithstanding the preceding, without the consent of any holder of notes,Notes, Titan, the Guarantors and the Trustee may amend or supplement the Indenture, the notesNotes or the Note Guarantees: (1) to cure any ambiguity, defect, omission or inconsistency, as determined in good faith by Titan’s Board of Directors; (2) to provide for uncertificated notesNotes in addition to or in place of certificated notes; Notes;(3) to provide for the assumption of Titan’s or a Guarantor’s obligations to holders of notesNotes and Note Guarantees in the case of a merger or consolidation or sale of all or substantially all of Titan’s or such Guarantor’s assets, as applicable; (4) to make any change that would provide any additional rights or benefits to the holders of notesNotes or that does not adversely affect the legal rights under the Indenture of any such holder; (5) to comply with requirements of the SEC in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act of 1939; Act;(6) to conform the text of the Indenture, the Note Guarantees or the notesNotes to any provision of this Description of Notes to the extent that such provision in this Description of notesNotes was intended, as determined in good faith by Titan’s Board of Directors, to be a verbatim recitation of a provision of the Indenture, the Note Guarantees or the notes; Notes;(7) to provide for the issuance of additional notesNotes in accordance with the limitations set forth in the Indenture; or (8) to allow any Guarantor to execute a supplemental Indentureand/or a Note Guarantee with respect to the notes. Notes.Satisfaction and Discharge The Indenture will be discharged and will cease to be of further effect as to all notesNotes issued thereunder, when: (a) all notesNotes that have been authenticated, except lost, stolen or destroyed notesNotes that have been replaced or paid and notesNotes for whose payment money has been deposited in trust and thereafter repaid to Titan, have been delivered to the Trustee for cancellation; or (b) all notesNotes that have not been delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable within one year and Titan or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the holders, cash in U.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities,
56
in amounts as will be sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the notesNotes not delivered to the Trustee for cancellation for principal, premium, if any, and accrued interest to the date of maturity or redemption; (2) no Default or Event of Default has occurred and is continuing on the date of the deposit (other than a Default or Event of Default resulting from the borrowing of funds to be applied to such deposit) and the deposit will not result in a breach or violation of, or constitute a default under, any other instrument to which Titan or any Guarantor is a party or by which Titan or any Guarantor is bound; (3) Titan or any Guarantor has paid or caused to be paid all sums payable by it under the Indenture; and (4) Titan has delivered irrevocable instructions to the Trustee under the Indenture to apply the deposited money toward the payment of the notesNotes at maturity or on the redemption date, as the case may be. In addition, Titan must deliver an officers’ certificate and an opinion of counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been satisfied. The Indenture and the notesNotes are governed by the laws of the State of New York. If the Trustee becomes a creditor of Titan or any Guarantor, the Indenture limits the right of the Trustee to obtain payment of claims in certain cases, or to realize on certain property received in respect of any such claim as security or otherwise. The Trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the SEC for permission to continue as trustee (if the Indenture has been qualified under the Trust Indenture Act of 1939)Act) or resign. The holders of a majority in aggregate principal amount of the then outstanding notesNotes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee, subject to certain exceptions. The Indenture provides that in case an Event of Default occurs and is continuing, the Trustee will be required, in the exercise of its power, to use the degree of care of a prudent man in the conduct of his own affairs. Subject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request of any holder of notes,Notes, unless such holder has offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense. Book-Entry, Delivery and Form The notesNotes initially will be represented by one or more notes in registered, global form without interest coupons (collectively, the “Global Notes”). The Global Notes will be deposited upon issuance with the Trustee as custodian for DTC in New York, New York, and registered in the name of DTC or its nominee, in each case for credit to the account of direct or indirect participants in DTC as described below. Except as set forth below, the Global Notes may be transferred, in whole and not in part, only to another nominee of DTC or to a successor of DTC or its nominee. In addition, transfers of beneficial interests in the Global Notes will be subject to the applicable rules and procedures of DTC and its direct or indirect participants, including, if applicable, those of Euroclear System (“Euroclear”), and Clearstream Banking, S.A. (“Clearstream”) (as indirect participants in DTC), which may change from time to time. Beneficial interests in the Global Notes may not be exchanged for notesdefinitive Notes in registered certificated form (“Certificated Notes”) except in the limited circumstances described below. See “—Exchange of Global Notes for Certificated Notes.” In addition, transfersExcept in the limited circumstances described below, owners of beneficial interests in the Global Notes will not be subjectentitled to the applicable rules and proceduresreceive physical delivery of DTC and its direct or indirect participants, which may change from time to time. Notes in certificated form.Depositary Procedures The following description of the operations and procedures of DTC, Euroclear and Clearstream are provided solely as a matter of convenience. These operations and procedures are solely within the control of the respective
57
settlement systems and are subject to changes by them. Titan takes no responsibility for these operations and procedures and urges investors to contact the system or their participants directly to discuss these matters. Titan understands that DTC is a limited-purpose trust company created to hold securities for its participating organizations (collectively, the “Participants”) and to facilitate the clearance and settlement of transactions in those securities between the Participants through electronic book-entry changes in accounts of its Participants. The Participants include securities brokers and dealers (including the initial purchaser)purchasers), banks, trust companies, clearing corporations and certain other organizations. Access to DTC’s system is also available to other entities such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Participant, either directly or indirectly (collectively, the “Indirect Participants”). Persons who are not Participants may beneficially own securities held by or on behalf of DTC only through the Participants or the Indirect Participants. The ownership interests in, and transfers of ownership interests in, each security held by or on behalf of DTC are recorded on the records of the Participants and Indirect Participants. Titan also understands that, pursuant to procedures established by DTC: (1) upon deposit of the Global Notes, DTC will credit the accounts of the Participants designated by the initial purchaserpurchasers with portions of the principal amount of the Global Notes; and (2) ownership of these interests in the Global Notes will be shown on, and the transfer of ownership of these interests will be effected only through, records maintained by DTC (with respect to the Participants) or by the Participants and the Indirect Participants (with respect to other owners of beneficial interest in the Global Notes). Investors in the Global Notes who are Participants may hold their interests therein directly through DTC. Investors in the Global Notes who are not Participants may hold their interests therein indirectly through organizations (including Euroclear and Clearstream) which are Participants in such system.Participants. Euroclear and Clearstream will hold interests in the Global Notes on behalf of their participants through customers’ securities accounts in their respective names on the books of their respective depositories, which are Euroclear Bank S.A./N.V., as operator of Euroclear, and Citibank, N.A., as operator of Clearstream. All interests in a Global Note, including those held through Euroclear or Clearstream, may be subject to the procedures and requirements of DTC. Those interests held through Euroclear or Clearstream may also be subject to the procedures and requirements of such systems. The laws of some states require that certain Persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer beneficial interests in a Global Note to such Persons will be limited to that extent. Because DTC can act only on behalf of the Participants, which in turn act on behalf of the Indirect Participants, the ability of a Person having beneficial interests in a Global Note to pledge such interests to Persons that do not participate in the DTC system, or otherwise take actions in respect of such interests, may be affected by the lack of a physical certificate evidencing such interests. Except as described below, owners of interests in the Global Notes will not have notesNotes registered in their names, will not receive physical delivery of notesNotes in certificated form and will not be considered the registered owners or “holders” thereof under the Indenture for any purpose. Payments in respect of the principal of, and interest and premium, if any, on, a Global Note registered in the name of DTC or its nominee will be payable to DTC in its capacity as the registered holder under the Indenture. Under the terms of the Indenture, Titan, the Guarantors, and the Trustee will treat the Persons in whose names the notes,Notes, including the Global Notes, are registered as the owners of the notesNotes for the purpose of receiving payments and for all other purposes. Consequently, none of Titan, the Guarantors, the Trustee andor any agent of Titan, the Guarantors, or the Trustee has or will have any responsibility or liability for: (1) any aspect of DTC’s records or any Participant’s or Indirect Participant’s records relating to or payments made on account of beneficial ownership interest in the Global Notes or for maintaining, supervising or reviewing any of DTC’s records or any Participant’s or Indirect Participant’s records relating to the beneficial ownership interests in the Global Notes; or (2) any other matter relating to the actions and practices of DTC or any of its Participants or Indirect Participants.
58
Titan understands that DTC’s current practice, upon receipt of any payment in respect of securities such as the notesNotes (including principal and interest), is to credit the accounts of the relevant Participants with the payment on the payment date unless DTC has reason to believe that it will not receive payment on such payment date. Each relevant Participant is credited with an amount proportionate to its beneficial ownership of an interest in the principal amount of the relevant security as shown on the records of DTC. Payments by the Participants and the Indirect Participants to the beneficial owners of notesNotes will be governed by standing instructions and customary practices and will be the responsibility of the Participants or the Indirect Participants and will not be the responsibility of DTC, the Trustee, Titan or Titan. Neitherthe Guarantors. None of Titan, northe Guarantors or the Trustee will be liable for any delay by DTC or any of the Participants or the Indirect Participants in identifying the beneficial owners of the notes,Notes, and Titan and the Trustee may conclusively rely on and will be protected in relying on instructions from DTC or its nominee for all purposes. Transfers between the Participants will be effected in accordance with DTC’s procedures, and will be settled insame-day funds, and transfers between participants in Euroclear and Clearstream will be effected in accordance with their respective rules and operating procedures. Cross-market transfers between the Participants, on the one hand, and Euroclear or Clearstream participants, on the other hand, will be effected through DTC in accordance with DTC’s rules on behalf of Euroclear or Clearstream, as the case may be, by their respective depositaries; however, such cross-market transactions will require delivery of instructions to Euroclear or Clearstream, as the case may be, by the counterparty in such system in accordance with the rules and procedures and within the established deadlines (Brussels time) of such system. Euroclear or Clearstream, as the case may be, will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take action to effect final settlement on its behalf by delivering or receiving interests in the relevant Global Note in DTC, and making or receiving payment in accordance with normal procedures forsame-day funds settlement applicable to DTC. Euroclear participants and Clearstream participants may not deliver instructions directly to the depositories for Euroclear or Clearstream. Titan understands that DTC will take any action permitted to be taken by a holder of notesNotes only at the direction of one or more Participants to whose account DTC has credited the interests in the Global Notes and only in respect of such portion of the aggregate principal amount of the notesNotes as to which such Participant or Participants has or have given such direction. However, if there is an Event of Default under the notes,Notes, DTC reserves the right to exchange the Global Notes for noteslegended Notes in certificated form, and to distribute such notesNotes to its Participants. Although DTC, Euroclear and Clearstream have agreed to the foregoing procedures to facilitate transfers of interests in the Global Notes among participants in DTC, Euroclear and Clearstream, they are under no obligation to perform or to continue to perform such procedures, and may discontinue such procedures at any time. None of Titan, the Trustee and any of their respective agents will have any responsibility for the performance by DTC, Euroclear or Clearstream or their respective participants or indirect participants of their respective obligations under the rules and procedures governing their operations. Exchange of Global Notes for Certificated Notes A Global Note is exchangeable for Certificated Notes if: (1) DTC (a) notifies Titan that it is unwilling or unable to continue as depositary for the Global Notes or (b) has ceased to be a clearing agency registered under the Exchange Act and, in either case, Titan fails to appoint a successor depositary; (2) Titan, at its option, notifies the Trustee in writing that it elects to cause the issuance of the Certificated Notes; or (3) there has occurred and is continuing a Default or Event of Default with respect to the notes. Notes.In addition, beneficial interests in a Global Note may be exchanged for Certificated Notes upon prior written notice given to the Trustee by or on behalf of DTC in accordance with the Indenture. In all cases, Certificated Notes delivered in exchange for any Global Note or beneficial interests in Global Notes will be registered in the names, and issued in any approved denominations, requested by or on behalf of the depositorydepositary (in accordance with its customary procedures).
59 and will bear the applicable restrictive legend referred to in “Notice to Investors,” unless that legend is not required by applicable law.
Same Day Settlement and Payment Titan will make payments in respect of the notesNotes represented by the Global Notes (including principal, premium, if any, and interest) by wire transfer of immediately available funds to the accounts specified by DTC or its nominee. Titan will make all payments of all principal, interest and premium, if any, with respect to Certificated Notes by wire transfer of immediately available funds to the accounts specified by the holders of the Certificated Notes or, if no such account is specified, by mailing a check to each such holder’s registered address. The notesNotes represented by the Global Notes are expected to be eligible to trade in DTC’sSame-Day Funds Settlement System, and any permitted secondary market trading activity in such notesNotes will, therefore, be required by DTC to be settled in immediately available funds. Titan expects that secondary trading in any Certificated Notes will also be settled in immediately available funds. Because of time zone differences, the securities account of a Euroclear or Clearstream participant purchasing an interest in a Global Note from a Participant will be credited, and any such crediting will be reported to the relevant Euroclear or Clearstream participant, during the securities settlement processing day (which must be a business day for Euroclear and Clearstream) immediately following the settlement date of DTC. Titan understands that cash received in Euroclear or Clearstream as a result of sales of interests in a Global Note by or through a Euroclear or Clearstream participant to a Participant will be received with value on the settlement date of DTC but will be available in the relevant Euroclear or Clearstream cash account only as of the business day for Euroclear or Clearstream following DTC’s settlement date. Anyone who receives this prospectus may obtain a copy of the Indenture without charge by writing to Titan International, Inc., Office of Investor Relations, 2701 Spruce Street, Quincy, Illinois 62301. Set forth below are certain defined terms used in the Indenture. Reference is made to the Indenture for a full disclosure of all defined terms used therein, as well as any other capitalized terms used herein for which no definition is provided. “2017 Notes” means the $525,000,000 aggregate principal amount of 7.875% Senior Secured Notes due 2017 issued pursuant to the indenture dated as of October 1, 2010, as supplemented by the supplemental indenture dated as of March 11, 2013, by and among Titan, the guarantors named therein and U.S. Bank National Association, as trustee. “Act of Required Debtholders”Debtholders” means a vote by holders of a majority of the principal amount of the notes. Notes.““Acquired Debt” meansmeans,, with respect to any specified Person: (1) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with or into, or becoming a Restricted Subsidiary of, such specified Person; and (2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person. ““Affiliate”Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “control,” as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. For purposes of this definition, the terms “controlling,” “controlled by” and “under common control with” have correlative meanings. ““Applicable Premium”Premium” means, with respect to any noteNote on any redemption date, the greater of: (1) 1.0% of the principal amount of the note;Note; or (a) the present value at such redemption date of (i) the principal amountredemption price of such Note at October 1, 2016 (such redemption price being set forth in the note at maturitytable appearing above under “—Optional Redemption”) plus (ii) all required interest payments due on the noteNote through the maturity date of the noteOctober 1, 2016 (excluding accrued
60
but unpaid interest to the redemption date), computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over (b) the principal amount of the note,Note, if greater. ““Asset Sale”Sale” means: (1) the sale, lease, conveyance or other disposition of any assets or rights;providedthat the sale, lease, conveyance or other disposition of all or substantially all of the assets of Titan and its Restricted Subsidiaries taken as a whole will be governed by the provisions of the Indenture described above under the caption “—Repurchase at the Option of Holders — Holders—Change of Control”and/or the provisions described above under the caption “—Certain Covenants — Covenants—Merger, Consolidation or Sale of Assets” and not by the provisions of the Asset Sale covenant; and (2) the issuance of Equity Interests in any of Titan’s Restricted Subsidiaries or the sale of Equity Interests in any of its Subsidiaries. Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale: (1) any single transaction or series of related transactions that involves assets (other than Collateral) having a Fair Market Value of less than $25.0 million; (2) a transfer of assets (other than Collateral) or rights between or among Titan and its Restricted Subsidiaries; (3) an issuance of Equity Interests by a Restricted Subsidiary of Titan to Titan or to a Restricted Subsidiary of Titan; (4) the sale, assignment or lease of products, rights, services, equipment, inventory or accounts receivable in the normal course of business and any sale or other disposition of damaged, worn-out or obsolete assets or properties in the normal course of business; (5) the sale or other disposition of cash or Cash Equivalents; (6) the license of any intellectual property of Titan or any of its Restricted Subsidiaries in the normal course of business; (7) the surrender or waiver of contract or intellectual property rights, or the settlement, release or surrender of contract, tort or other litigation claims, but only to the extent that pursuant to such surrender, waiver, settlement or release Titan or any of its Restricted Subsidiaries does not receive cash or Cash Equivalents in exchange therefor; or (8) a Restricted Payment that does not violate the covenant described above under the caption “—Certain Covenants — Covenants—Restricted Payments” or a Permitted Investment. ““Asset Sale Offer”Offer” has the meaning assigned to that term in the Indenture governing the notes. Notes.““Attributable Debt”Debt” in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligation of the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including any period for which such lease has been extended or may, at the option of the lessor, be extended. Such present value shall be calculated using a discount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP;provided, however, that if such sale and leaseback transaction results in a Capital Lease Obligation, the amount of Indebtedness represented thereby will be determined in accordance with the definition of “Capital Lease Obligation.” ““Beneficial Owner”Owner” has the meaning assigned to such term inRule 13d-3 andRule 13d-5 under the Exchange Act. The terms “Beneficially Owns” and “Beneficially Owned” have a corresponding meaning. ““Board of Directors”Directors” means: (1) with respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act on behalf of such board;
61
(2) with respect to a partnership, the Board of Directors of the general partner of the partnership; (3) with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and (4) with respect to any other Person, the board or committee of such Person serving a similar function. ““Borrowing Base”Base” has the meaning ascribed to it in the First Amendment, dated as of September 9, 2010, to Amended and Restated Credit Agreement, dated as of January 30, 2009, among Titan and Bank of America, N.A. Agreement.““Business Asset”Asset” means assets (except in connection with the acquisition of a Subsidiary in a Permitted Business that becomes a Guarantor) other than notes, bonds, obligations and securities that, in the good faith judgment of the Board of Directors, will immediately constitute, be a part of, or be used in, a Permitted Business. ““Capital Lease Obligation”Obligation” means, at the time any determination is to be made, the amount of the liability in respect of a capital lease that would at that time be required to be capitalized on a balance sheet prepared in accordance with GAAP, and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may be prepaid by the lessee without payment of a penalty. ““Capital Stock”Stock” means: (1) in the case of a corporation, corporate stock; (2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (3) in the case of a partnership or limited liability company, partnership interests (whether general or limited) or membership interests; and (4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person, but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock. ““Cash Equivalents”Equivalents” means: (1) United States dollars or currencies held by Titan or any of its Subsidiaries from time to time in the normal course of business; (2) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States is pledged in support of those securities) having maturities of not more than six months from the date of acquisition; (3) certificates of deposit and eurodollar time deposits with maturities of six months or less from the date of acquisition, bankers’ acceptances with maturities not exceeding six months and overnight bank deposits, in each case, with any domestic commercial bank having capital and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of “B” or better; (4) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (2) and (3) above entered into with any financial institution meeting the qualifications specified in clause (3) above; (5) commercial paper having one of the two highest ratings obtainable from Moody’s or S&P and, in each case, maturing within six months after the date of acquisition; and (6) money market funds at least 95% of the assets of which constitute Cash Equivalents of the kinds described in clauses (1) through (5) of this definition.
62
““Change of Control”Control” means the occurrence of any of the following: (1) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of Titan and its Subsidiaries taken as a whole to any “person” or “group” (as that term isthose terms are used in Section 13(d) of the Exchange Act); (2) the adoption of a plan relating to the liquidation or dissolution of Titan; (3) the consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any “person” (asor “group” (in each case as defined above) becomes the ultimate Beneficial Owner, directly or indirectly, of more than 50% of the Voting Stock of Titan, measured by voting power rather than number of shares; or (4) the first day on which a majority of the members of the Board of Directors of Titan are not Continuing Directors. ““Change of Control Offer”Offer” has the meaning assigned to that term in the Indenture governing the notes. Notes.““Consolidated Cash Flow”Flow” means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such periodplus, without duplication: (1) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was deducted in computing such Consolidated Net Income;plus (2) the Fixed Charges of such Person and its Restricted Subsidiaries for such period, to the extent that such Fixed Charges were deducted in computing such Consolidated Net Income;plus (3) other non-cash charges from employee compensation expenses arising from the issuance of stock, options to purchase stock, deferrals and stock appreciation rights (excluding any such expenses which relate to options or rights which, at the option of the holder thereof, may be settled in cash);plus (4) depreciation, amortization (including amortization of intangibles but excluding amortization of prepaid cash expenses that were paid in a prior period) and other non-cash expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses were deducted in computing such Consolidated Net Income;plus (5) non-cash items (other than any non-cash items that will require cash payments in the future or that relate to foreign currency translation) decreasing such Consolidated Net Income for such period other than items that were accrued in the normal course of business;minus (6) non-cash items (other than any non-cash items that will require cash payments in the future or that relate to foreign currency translation) increasing such Consolidated Net Income for such period, other than the items that were accrued in the normal course of business, in each case, on a consolidated basis and determined in accordance with GAAP. ““Consolidated Net Income”Income” means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP;providedthat: (1) the Net Income (but not loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting will be included only to the extent of the amount of dividends or similar distributions paid in cash to the specified Person or a Restricted Subsidiary of the Person; (2) the Net Income of any Restricted Subsidiary will be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or
63
indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its shareholders; (3) the cumulative effect of a change in accounting principles will be excluded; (4) any non-cash goodwill impairment charges will be excluded; (5) any non-cash charges relating to the underfunded portion of any pension plan will be excluded; (6) any non-cash charges resulting from the application of SFAS No. 123 will be excluded; and (7) one time cost and expenses directly related to the repurchase of Titan’s 8% Senior Unsecured Notes due 2012 will be excluded. ““Consolidated Net Tangible Assets”Assets” means, with respect to any Person as of any date, the amount which, in accordance with GAAP, would be set forth under the caption “Total Assets” (or any like caption) on a consolidated balance sheet of such Person and its Restricted Subsidiaries (less applicable reserves), after deducting therefrom (a) all current liabilities and (b) all goodwill and any other amounts classified as intangible assets in accordance with GAAP. “Consolidated Secured Debt” of a specified Person means as of any date of determination, an amount equal to the Consolidated Total Debt of such Person and its Restricted Subsidiaries as of such date that is secured by Liens on property or assets of Titan or its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP (excluding items eliminated in consolidation). “Consolidated Secured Leverage Ratio” of a Person means, as of any date of determination, the ratio of (a) Consolidated Secured Debt of such Person and its Restricted Subsidiaries on the date of determination (after giving effect to any incurrence, assumption, Guarantee, repayment, repurchase, redemption, retirement or extinguishment of Indebtedness on such date) to (b) the aggregate amount of Consolidated Cash Flow of such Person and its Restricted Subsidiaries for the then most recent four quarter period prior to such date for which internal financial statements are available. For purposes of determining the “Consolidated Secured Leverage Ratio,” (i) Consolidated Cash Flow shall be subject to the adjustments applicable to Consolidated Cash Flow as provided for in the definition of “Fixed Charge Coverage Ratio” and (ii) Titan and its Restricted Subsidiaries must treat the maximum amount of Indebtedness that is permitted to be incurred pursuant to clause (1) of the second paragraph of “—Certain Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock” at the time of such calculation as being incurred and outstanding at such time. “Consolidated Total Debt” of a specified Person means, as of any date of determination, an amount equal to the aggregate principal amount of all outstanding Indebtedness of such Person and its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP (excluding items eliminated in consolidation). “Continuing Directors”Directors” means, as of any date of determination, any member of the Board of Directors of Titan who: (1) was a member of such Board of Directors on the Issue Date; or (2) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board of Directors at the time of such nomination or election. Under a recent Delaware Chancery Court interpretation of a similar definition of “Continuing Directors,“Credit Facilities” a board of directors may approve, for purposes of such definition, a slate of shareholder-nominated directors without endorsing them, or while simultaneously recommending and endorsing its own slate instead. It is unclear whether Titan’s Board of Directors, pursuant to Illinois law, is similarly capable of approving a slate of dissident director nominees while recommending and endorsing its own slate. If such an action is possible under Illinois law, the foregoing interpretation would permit Titan’s Board of Directors to approve a slate of directors that included a majority of dissident directors nominated pursuant to a proxy contest, and the ultimate election of such dissident slate would not constitute a “Change of Control” as described above under the caption “— Change of Control” that would trigger the holders’ right to require Titan to repurchase the holders’ notes as described above. “Credit Facilities”means one or more debt facilities (including, without limitation, the Second Amended and Restated Credit Agreement, dated as of January 30, 2009,December 21, 2012, among Titan and Bank of America, N.A. (the “Credit Agreement”) or commercial paper facilities, in each case, with banks or other institutional lenders providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables) or letters of credit, in each case, as amended, restated, modified, renewed, refunded, replaced (whether upon or after termination or otherwise) or refinanced (including by means of sales of debt securities to institutional investors) in whole or in part from time to time.
““Default”Default” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default. ““Designated Noncash Consideration”Consideration” means the Fair Market Value of noncash consideration received by Titan or any of its Restricted Subsidiaries in connection with an Asset Sale that is so designated as Designated Noncash Consideration pursuant to an officers’ certificate of Titan, setting forth the basis of such valuation, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Noncash Consideration. ““Disqualified Stock”Stock” means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case, at the option of the holder of the Capital Stock), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the notesNotes mature. Notwithstanding the preceding sentence, any Capital Stock
64
that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require Titan to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Capital Stock provide that Titan may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the covenant described above under the caption “—Certain Covenants — Covenants—Restricted Payments.” The amount of Disqualified Stock deemed to be outstanding at any time for purposes of the Indenture will be the maximum amount that Titan and its Restricted Subsidiaries may become obligated to pay upon the maturity of, or pursuant to any mandatory redemption provisions of, such Disqualified Stock, exclusive of accrued dividends. ““Equipment”Equipment” of any Person or business means all machinery and equipment of such Person or business, including all such Persons’ or businesses’ processing equipment, conveyors, machine tools and all engineering, processing and manufacturing equipment, office machinery, furniture, tools, attachments, accessories, molds, dies, stamps, and other machinery and equipment, but not including any motor vehicles or other titled assets. ““Equity Interests”Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock). ““Equity Offering”Offering” means an issuance or sale of Equity Interests (other than Disqualified Stock) of Titan. “Exchange Notes” means the debt securities of Titan issued pursuant to the Indenture in exchange for, and in an aggregate principal amount equal to, the outstanding notes,Notes, in compliance with the terms of the registration rights agreement. ““Existing Indebtedness”Indebtedness” means the Indebtedness of Titan and its Restricted Subsidiaries (other than Indebtedness under our Credit Agreement) in existence on the Issue Date, until such amounts are repaid. ““Fair Market Value”Value” means the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction not involving distress or necessity of either party, determined in good faith by the Board of Directors of Titan. ““Fixed Charge Coverage Ratio”Ratio” means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such Person for such period to the Fixed Charges of such Person for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, guarantees, repays, repurchases, redeems, defeases or otherwise discharges any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred stock subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the ““Calculation Date”Date”), then the Fixed Charge Coverage Ratio will be calculated givingpro forma effect to such incurrence, assumption, Guarantee, repayment, repurchase, redemption, defeasance or other discharge of Indebtedness, or such issuance, repurchase or redemption of preferred stock, and the use of the proceeds therefrom, as if the same had occurred at the beginning of the applicable four-quarter reference period. In addition, for purposes of calculating the Fixed Charge Coverage Ratio: (1) acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers or consolidations, or any Person or any of its Restricted Subsidiaries acquired by the specified Person or any of its Restricted Subsidiaries, and including any related financing transactions and including increases in ownership of Restricted Subsidiaries, during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date will be givenpro forma effect (in accordance with Regulation S-X under the Securities Act) as if they had occurred on the first day of the four-quarter reference period; (2) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership interests therein) disposed of prior to the Calculation Date, will be excluded; (3) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership interests therein) disposed of prior to the Calculation Date, will be
65
excluded, but only to the extent that the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its Restricted Subsidiaries following the Calculation Date; (4) any Person that is a Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary at all times during such four-quarter period; (5) any Person that is not a Restricted Subsidiary on the Calculation Date will be deemed not to have been a Restricted Subsidiary at any time during such four-quarter period; and (6) if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligation applicable to such Indebtedness if such Hedging Obligation has a remaining term as at the Calculation Date in excess of 12 months). ““Fixed Charges”Charges” means, with respect to any specified Person for any period, the sum, without duplication, of: (1) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations, imputed interest with respect to Attributable Debt and fees and charges incurred in respect of letter of credit or bankers’ acceptance financings, and net of the effect of all payments made or received pursuant to Hedging Obligations in respect of interest rates;plus (2) the consolidated interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period;plus (3) any interest on Indebtedness of another Person that is guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such Guarantee or Lien is called upon;plus (4) the product of (a) all dividends, whether paid or accrued and whether or not in cash, on any series of preferred stock of such Person or any of its Restricted Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of Titan (other than Disqualified Stock) or to Titan or a Restricted Subsidiary of Titan, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a decimal, in each case, determined on a consolidated basis in accordance with GAAP. “Foreign Subsidiary” means, with respect to any Person, any Restricted Subsidiary of such Person that is not organized or existing under the laws of the United States of America, any state or territory thereof or the District of Columbia and any Restricted Subsidiary of such Foreign Subsidiary. “GAAP”GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which are in effect from time to time. on the Issue Date.““Guarantee”Guarantee” means a guarantee other than by endorsement of negotiable instruments for collection in the normal course of business, direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take or pay or to maintain financial statement conditions or otherwise). ““Guarantors”Guarantors” means the Subsidiaries that own any interest in the Collateral, which consist of: Titan Wheel Corporation of Illinois, an Illinois Corporation; Titan Tire Corporation, an Illinois Corporation; | | | | • | Titan Wheel Corporation of Illinois, an Illinois Corporation; | | | • | Titan Tire Corporation, an Illinois Corporation; | | | • | Titan Tire Corporation of Freeport, an Illinois Corporation; and | | | • | Titan Tire Corporation of Bryan, an Ohio Corporation; |
Titan Tire Corporation of Freeport, an Illinois Corporation; and Titan Tire Corporation of Bryan, an Ohio Corporation; and their respective successors and assigns, in each case, until the Note Guarantee of such Person has been released in accordance with the provisions of the Indenture.
66
““Hedging Obligations”Obligations” means, with respect to any specified Person, the obligations of such Person under: (1) interest rate swap agreements (whether from fixed to floating or from floating to fixed), interest rate cap agreements and interest rate collar agreements; (2) other agreements or arrangements designed to manage interest rates or interest rate risk; and (3) other agreements or arrangements designed to protect such Person against fluctuations in currency exchange rates or commodity prices. ““Indebtedness”Indebtedness” means, with respect to any specified Person, any indebtedness of such Person (excluding accrued expenses and trade payables): (1) in respect of borrowed money; (2) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof); (3) in respect of banker’s acceptances; (4) representing Capital Lease Obligations or Attributable Debt in respect of sale and leaseback transactions; (5) representing the balance deferred and unpaid of the purchase price of any property or services due more than six months after such property is acquired or such services are completed; or (6) representing any Hedging Obligations, if and to the extent any of the preceding items (other than letters of credit, Attributable Debt and Hedging Obligations) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP. In addition, the term “Indebtedness” includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the Guarantee by the specified Person of any Indebtedness of any other Person. ““Investments”Investments” means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans (including Guarantees or other obligations), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the normal course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. If Titan or any Subsidiary of Titan sells or otherwise disposes of any Equity Interests of any direct or indirect Subsidiary of Titan such that, after giving effect to any such sale or disposition, such Person is no longer a Subsidiary of Titan, Titan will be deemed to have made an Investment on the date of any such sale or disposition equal to the Fair Market Value of Titan’s Investments in such Subsidiary that were not sold or disposed of in an amount determined as provided in the final paragraph of the covenant described above under the caption “—Certain Covenants — Covenants—Restricted Payments.” The acquisition by Titan or any Subsidiary of Titan of a Person that holds an Investment in a third Person will be deemed to be an Investment by Titan or such Subsidiary in such third Person in an amount equal to the Fair Market Value of the Investments held by the acquired Person in such third Person in an amount determined as provided in the final paragraph of the covenant described above under the caption “—Certain Covenants — Covenants—Restricted Payments.” The amount of an Investment will be determined at the time the Investment is made and without giving effect to subsequent changes in value. ““Issue Date”Date” means October 1, 2010, the first date on which any notes wereNotes are issued pursuant to the Indenture. ““Lien”Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any easement, right of way or other encumbrance on title to real property, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
67
““Moody’s”Moody”means Moody’s Investors Service, Inc. ““Mortgages”Mortgages” means, collectively, the first priority lien deeds of trust, trust deeds and mortgages made by Titan and the Guarantors (to the extent each is a party thereto) in favor or for the benefit of the Collateral Trustee on behalf of and for the benefit of the holders of the notesNotes substantially in the form attached to the Indenture (with such changes as may be customary to account for local law matters) and otherwise in form and substance satisfactory to the Collateral Trustee. ““Mortgage Closing Date”Date” means 120 days after the Issue Date. ““Mortgaged Properties”Properties” means the real estate on and buildings in which our manufacturing facilities are located, in Des Moines, Iowa; Freeport, Illinois; Quincy, Illinois; and Bryan, Ohio. ““Net Income”Income” means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of preferred stock dividends, excluding, however: (1) any gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with: (a) any Asset Sale; or (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person or any of its Restricted Subsidiaries; and (2) any extraordinary gain or loss, together with any related provision for taxes on such extraordinary gain or loss. ““Net Proceeds”Proceeds” means the aggregate cash proceeds and the Fair Market Value of any notes receivable and common stock received by Titan or any of its Restricted Subsidiaries in respect of any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to such Asset Sale, including, without limitation, legal, accounting and investment banking fees, and sales commissions, and any relocation expenses incurred as a result of the Asset Sale, taxes paid or payable as a result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, and amounts required to be applied to the repayment of Indebtedness, other than Indebtedness under a Credit Facility, secured by a Lien on the asset or assets that were the subject of such Asset Sale and any reserve for adjustment in respect of the sale price of such asset or assets established in accordance with GAAP. ““Non-Recourse Debt”Debt” means Indebtedness: (1) as to which neither Titan nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor or otherwise, or (c) constitutes the lender; (2) no default with respect to which (including any rights that the holders of the Indebtedness may have to take enforcement action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness of Titan or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment of the Indebtedness to be accelerated or payable prior to its Stated Maturity; and (3) as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of Titan or any of its Restricted Subsidiaries. ““Note Guarantee”Guarantee” means the Guarantee by each Guarantor of Titan’s obligations under the Indenture and the notes,Notes, executed pursuant to the provisions of the Indenture. ““Note Obligations”Obligations” means the Obligations under the notes. Notes.““Obligations”Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness. ““Orderly Liquidation Value”Value” means the greater of (a) the in place orderly liquidation value, as determined by the most recent appraisal prepared by or on behalf of Titan, or (b) the book value of such assets.
68
““Permitted Business”Business” means (i) the business conducted by, or proposed to be conducted by, Titan and its Restricted Subsidiaries on the Issue Date and (ii) businesses that are reasonably similar, ancillary or related to, or a reasonable extension or expansion of, the business conducted by Titan and its Restricted Subsidiaries on the Issue Date. ““Permitted Investments”Investments” means: (1) any Investment in Titan or in a Wholly-Owned Restricted Subsidiary of Titan;provided thatif such Investment is in a Restricted Subsidiary that is not a Guarantor, such Investment shall not consist of a transfer or contribution of assets that are located on the Collateral on the Issue Date; (2) any Investment in Cash Equivalents; (3) any Investment by Titan or any Restricted Subsidiary of Titan in a Person, if as a result of such Investment: (a) such Person becomes a Restricted Subsidiary of Titan and a Guarantor;Titan; or (b) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, Titan or a Restricted Subsidiary of Titan that is a Guarantor; Titan;(4) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with the covenant described above under the caption “—Repurchase at the Option of Holders — Holders—Asset Sales;” (5) any acquisition of assets or Capital Stock solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of Titan; (6) any Investment made prior to the Issue Date; (7) any Investments received in compromise or resolution of (A) obligations of trade creditors or customers that were incurred in the normal course of business of Titan or any of its Restricted Subsidiaries, including pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer; or (B) litigation, arbitration or other disputes with Persons who are not Affiliates; (8) advances, loans or extensions of trade credit in the normal course of business by Titan or any of its Restricted Subsidiaries; (9) Investments represented by Hedging Obligations not made for speculative purposes; (10) loans or advances to officers and employees made in the normal course of business of Titan or any Restricted Subsidiary of Titan in an aggregate principal amount not to exceed $2.0 million at any one time outstanding; (11) repurchases of the notes; Notes;(12) other Investments in a Permitted Business of any Person having an aggregate Fair Market Value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (12) that are at the time outstanding not to exceed in the aggregate at any time outstanding 15.0% of Consolidated Net Tangible Assets, provided that any such Investment will not be deemed to be outstanding pursuant to this clause (12) if such Investment subsequently constitutes a Permitted Investment pursuant to clause (3) hereof; and (13) other Investments in any Person, including any joint venture, having an aggregate Fair Market Value (measured on the date each such Investment was made and without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant to this clause (13) that are at the time outstanding not to exceed $50.0$100.0 million, provided that any such Investment will not be deemed to be outstanding pursuant to this clause (13) if such Investment subsequently constitutes a Permitted Investment pursuant to clause (3) hereof.
69
hereof; and (14) other Investments in a Permitted Business of any Person constituting intercompany loans; provided that (a) Titan or its Restricted Subsidiaries own at least 30% of the total Voting Stock of such Person and such Person is consolidated into Titan for purposes of GAAP and (b) the Board of Directors of Titan determines in good faith that such transaction is fair to Titan and its Restricted Subsidiaries.“Permitted Liens”Liens” means: (1) Liens on assets of Titan or any Guarantor (other than the Collateral) securing Indebtedness and other Obligations not to exceed the sum of (A) the Indebtedness permitted to be incurred under clause (1) of the second paragraph of the covenant entitled “—Certain Covenants — Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock” and (B) the amount of Indebtedness, not to exceed $125.0$175.0 million, that can be incurred on the date such Lien is created under the Fixed Charge Coverage Ratio test set forth in the first paragraph of the covenant entitled “—Certain Covenants — Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock”; (2) Liens in favor of Titan or the Guarantors; (3) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with Titan or any Subsidiary of Titan;providedthat such Liens were in existence prior to the contemplation of such merger or consolidation and do not extend to any assets other than those of the Person merged into or consolidated with Titan or the Subsidiary; (4) Liens on property (including Capital Stock) existing at the time of acquisition of the property by Titan or any Subsidiary of Titan;providedthat such Liens were in existence prior to such acquisition and not incurred in contemplation of such acquisition; (5) Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds or other obligations of a like nature incurred in the normal course of business; (6) Liens to secure Indebtedness (including Capital Lease Obligations) permitted by clause (4) of the second paragraph of the covenant entitled “—Certain Covenants — Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock” covering only the assets (other than the Collateral) acquired with or financed by such Indebtedness; (7) With respect to (i) personal property, Liens existing on the date of the Indenture, and (ii) real properties, Permitted Encumbrances (as defined in the Mortgages); (8) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded;providedthat any reserve or other appropriate provision as is required in conformity with GAAP has been made therefor; (9) statutory or common law Liens of landlords, carriers, warehousemen, mechanics, materialmen, repairmen, construction contractors or other like Liens arising in the ordinary course of business which secure amounts not overdue for a period of more than thirty (30) days or, if more than thirty (30) days overdue, are unfiled and no other action has been taken to enforce such Lien or which are being contested in good faith and by appropriate proceedings diligently conducted, if adequate reserves with respect thereto are maintained on the books of the applicable Person; (10) easements,rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property that were not incurred in connection with Indebtedness and that do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person; (11) Liens created for the benefit of (or to secure) the notesNotes (or the Note Guarantees); (12) Liens to secure any Permitted Refinancing Indebtedness permitted to be incurred under the Indenture;provided,however, that: (a) the new Lien shall be limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to such property or proceeds or distributions thereof); and (b) the Indebtedness secured by the new Lien is not increased to any amount greater than the sum of (x) the outstanding principal amount, or, if greater, committed amount, of the Permitted Refinancing
70
Indebtedness and (y) an amount necessary to pay any fees and expenses, including premiums, related to such renewal, refunding, refinancing, replacement, defeasance or discharge; (13) Liens on assets of Titan or any Subsidiary of Titan (other than Collateral) incurred in the normal course of business securing obligations that do not exceed $50.0 million at any one time outstanding; (14) Liens on assets (other than the Collateral) securing Hedging Obligations entered into in the normal course of business; and (15) Liens on any Equipment of Titan or any Guarantor. Guarantor;(16) Liens securing Indebtedness (including Liens securing any Obligations in respect thereof) permitted to be incurred pursuant to the covenant described under the heading “—Certain Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock”;provided that at the time of any incurrence of such Indebtedness pursuant to this clause (16) and after givingpro forma effect thereto, the Consolidated Secured Leverage Ratio of Titan is less than 3.25 to 1.00; and (17) Liens on assets of Foreign Subsidiaries securing Indebtedness incurred under clause (15) of “—Certain Covenants—Incurrence of Indebtedness and Issuance of Preferred Stock.” “Permitted Refinancing Indebtedness”Indebtedness” means any Indebtedness of Titan or any of its Restricted Subsidiaries issued in exchange for, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge other Indebtedness of Titan or any of its Restricted Subsidiaries (other than intercompany Indebtedness);providedthat: (1) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness renewed, refunded, refinanced, replaced, defeased or discharged (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith); (2) such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged; (3) if the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged is subordinated in right of payment to the notes,Notes, such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and is subordinated in right of payment to, the notesNotes on terms at least as favorable to the holders of notesNotes as those contained in the documentation governing the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged; and (4) such Indebtedness is incurred either by Titan or by the Restricted Subsidiary who is the obligor on the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged. ““Person”Person” means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity. ““Restricted Investment”Investment” means an Investment other than a Permitted Investment. ““Restricted Subsidiary”Subsidiary” of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary. ““S&P”&P” means Standard & Poor’s Ratings Group. ““Security Documents”Documents” means, collectively, the Indenture and the Mortgages. ““Significant Subsidiary”Subsidiary” means any Subsidiary that would be a “significant subsidiary” as defined in Article 1,Rule 1-02 ofRegulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date. ““Stated Maturity”Maturity” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the documentation governing such Indebtedness as of the Issue Date, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof. ““Subsidiary”Subsidiary” means, with respect to any specified Person: (1) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency and after giving effect to any voting agreement or stockholders’ agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the
71
time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and (2) any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are that Person or one or more Subsidiaries of that Person (or any combination thereof). ““Treasury Rate”Rate” means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two business days prior to the redemption date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to the maturity date of the notes;October 1, 2016;provided, however, that if the period from the redemption date to the maturity date of the notesOctober 1, 2016 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. ““Unrestricted Subsidiary”Subsidiary” means Titan Wheel Corporation of Virginia and any other Subsidiary of Titan that is designated by the Board of Directors of Titan as an Unrestricted Subsidiary pursuant to a resolution of the Board of Directors, but only to the extent that such Subsidiary: (1) has no Indebtedness other than Non-Recourse Debt; (2) except as permitted by the covenant described above under the caption “—Certain Covenants — Covenants—Transactions with Affiliates,” is not party to any agreement, contract, arrangement or understanding with Titan or any Restricted Subsidiary of Titan unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to Titan or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of Titan; (3) is a Person with respect to which neither Titan nor any of its Restricted Subsidiaries has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results; and (4) has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of Titan or any of its Restricted Subsidiaries, including, without limitation, through ownership of any interest in the Collateral. ““Voting Stock”Stock” of any specified Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person. ““Weighted Average Life to Maturity”Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing: (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment;by (2) the then outstanding principal amount of such Indebtedness. ““Wholly-Owned Restricted Subsidiary”Subsidiary” of any specified Person means a Subsidiary of such Person all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) will at the time be owned by such personPerson or by one or more Wholly-Owned Restricted Subsidiaries of such Person.
72
DESCRIPTION OF OTHER INDEBTEDNESS Revolving Credit Facility The Company has a $100$150.0 million revolving credit facility dated as of December 21, 2012 (“Revolving Credit Facility”) with agent Bank of America, N.A. The Credit Facility has a January 2014 termination date, which terminates in December 2017 and is collateralized by a first priority security interest in certain of assetsthe accounts receivable and inventory of Titan and assets of certain of its domestic subsidiaries, including their common stock. The Credit Facility contains certain financial covenants, restrictions and other customary affirmative and negative covenants. The financial covenants in this agreement require that:
| | | | • | Collateral coverage be equal to or greater than 1.2 times the outstanding revolver balance. | | | • | If the30-day average of the outstanding revolver balance exceeds $70 million, the fixed charge coverage ratio be equal to or greater than a 1.1 to 1.0 ratio. |
Restrictions include:
| | | | • | Limits on payments of dividends and repurchases of the Company’s stock. | | | • | Restrictions on the Company’s ability to make additional borrowings, or to consolidate, merge or otherwise fundamentally change the ownership of the Company. | | | • | Limitations on investments, dispositions of assets and guarantees of indebtedness. | | | • | Other customary affirmative and negative covenants. |
These covenants and restrictions could limit the Company’s ability to respond to market conditions, to provide for unanticipated capital investments, to raise additional debt or equity capital, to pay dividends or to take advantage of business opportunities, including future acquisitions. The failure by Titan to meet these covenants could result in the Company ultimately being in default on this Credit Facility. The Company is in compliance with the covenants and restrictions as of September 30, 2010. The collateral coverage was not applicable as there were no outstanding borrowings under the Credit Facility at September 30, 2010.
The fixed charge coverage ratio did not apply for the quarter ended September 30, 2010.subsidiaries. During the first nine months of 20102013 and at September 30, 2010,December 31, 2013, there were no borrowings under the Revolving Credit Facility.
Senior Unsecured Notes due 2012
In 2006 the Company issued its 8% Senior Unsecured Notes due 2012 (“Senior Unsecured Notes due 2012”). In July of 2010, the Company closedTitan Europe Credit Facilities The Titan Europe credit facilities contain borrowings from various institutions totaling $41.7 million at December 31, 2013. Maturity dates on a transaction to purchase $6.5 million of its issued and outstanding Senior Unsecured Notes due 2012. In connection with this transaction, the Company recorded expenses of approximately $0.3 million in the third quarter of 2010. These expenses related primarily to a tender premium of $45 per $1,000 principal amount of the notes. In the second quarter of 2010, the Company repurchased $47.4 million of principal value of Senior Unsecured Notes due 2012 resulting in a loss on senior note repurchase of $2.7 million. In the first quarter of 2009, the Company repurchased $6.2 million of principal value of Senior Unsecured Notes due 2012 for approximately $4.8 million resulting in a $1.4 million gain on the senior note repurchases. On October 4, 2010, the Company announced the expiration and final results of its previously announced cash tender offer and consent solicitation relating to all of its issued and outstanding Senior Unsecured Notes due 2012. On or prior to 5:00 p.m., New York City time, on October 1, 2010 (the “Expiration Time”), valid tenders had been received with respect to $138,884,000 of the $139,948,000 aggregate principal amount of Senior Unsecured Notes due 2012 outstanding. The Company accepted for payment the Senior Unsecured Notes due 2012 validly tendered on or prior to the Expiration Time. The consents received were sufficient to execute the proposed amendments to the indenture governing the Senior Unsecured Notes due 2012. Accordingly, Titan and the trustee under the indenture governing the Senior Unsecured Notes due 2012 entered into a supplemental indenture that eliminatesdebt range from the indenture governing the Senior Unsecured Notes due 2012 substantially all of the restrictive covenants, certain affirmative covenants and certain events of default. The supplemental indenture became operative on October 1, 2010. See “Summary — Recent Developments” and “Use of Proceeds.”
73
The Company’s Senior Unsecured Notes due 2012 outstanding balance was $1,064,000 at October 4, 2010. The Company’s Senior Unsecured Notes due 2012 are guaranteed by each of Titan’s current and future wholly owned domestic subsidiaries other than its immaterial subsidiaries (subsidiaries with total assets less than $250,000one year to eleven years and total revenues less than $250,000)interest rates range from 5% to 6.9%. The note guaranteesEuropean facilities are full and unconditional, joint and several obligationssecured by the assets of the guarantors. Non-guarantors consist primarily of foreign subsidiaries of the Company, which are organized outside the United States of America. The notes are effectively senior to the Senior Unsecured Notes due 2012 to the extent of the value of the Collateral securing the notes.
select European subsidiaries.Convertible Senior Subordinated Notes Due 2017 On December 21, 2009, the Company closed its offering of $172.5 million principal amount of 5.625% Convertible Senior Subordinated Notes due 2017 (“Senior SubordinatedConvertible Notes”), which included the exercise in full of the initial purchasers’ option to purchase $22.5 million principal amount of additional Senior Subordinated Notes to cover over-allotments.. The Senior Subordinated Notes were offered and sold in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended and to other investors pursuant to another applicable exemption from registration. The Company received net proceeds from the offering of approximately $166 million after deducting initial purchasers’ discounts and estimated offering expenses. The Company intends to use the proceeds from the offering for general corporate purposes, including financing potential future acquisitions and repayment of existing debt obligations.
The Senior SubordinatedConvertible Notes bear cash interest semiannually at an annual rate of 5.625%. Upon conversion, the Company will deliver a number of shares of its common stock as described in the indenture.indenture governing the Convertible Notes. The initial base conversion rate for the Senior SubordinatedConvertible Notes is 93.0016 shares of the Company’s common stock per $1,000 principal amount of Senior SubordinatedConvertible Notes, equivalent to an initial base conversion price of approximately $10.75 per share of its common stock. If the price of the Company’s common stock at the time of determination exceeds the base conversion price, the base conversion rate will be increased by an additional number of shares (up to 9.3002 shares of its common stock per $1,000 principal amount of Senior SubordinatedConvertible Notes) as determined pursuant to a formula described in the Convertible Notes indenture. The base conversion rate will be subject to adjustment in certain events. The initial base conversion price represents a premium of 37.5% relative to the December 15, 2009, closing sale price of the Company’s common stock.
The Company will have the right to redeem the Senior SubordinatedConvertible Notes in whole or in part at a specified redemption price on or after January 20, 2014 if the closing sale price of its common stock exceeds 130% of the base conversion price then in effect for 20 or more trading days in a period of 30 consecutive trading days ending on the trading day immediately prior to the date of the redemption notice. The Senior SubordinatedConvertible Notes indenture contains customary terms and covenants, including that upon certain events of default occurring and continuing, either the trustee or the holders of at least 25% in aggregate principal amount of the Convertible Notes then outstanding may declare the entire principal amount of the Convertible Notes together with any accrued and unpaid interest thereon to be immediately due and payable. In the case of an event of default relating to certain events of bankruptcy, insolvency or reorganization of the Company or a material subsidiary, the entire principal amount of the Convertible Notes together with any accrued and unpaid interest thereon will automatically become and be immediately due and payable. The Convertible Notes are subordinated in right of payment to the Company’s existing Senior Unsecured Notes due 2012 andNotes. In the notes. BOOK ENTRY SETTLEMENT AND CLEARANCE
Global Notes
The exchange notes will be issued in the formfirst quarter of one or more registered notes in global form, without interest coupons (the “Global Notes”). Upon issuance, each of the Global Notes will be deposited with the Trustee as custodian for DTC and registered in the name of Cede & Co., as nominee of DTC.
Ownership of beneficial interests in each Global Note will be limited to persons who have accounts with DTC (“DTC participants”) or persons who hold interests through DTC participants. We expect that under procedures established by DTC:
| | | | • | upon deposit of each Global Note with DTC’s custodian, DTC will credit portions of the principal amount of the Global Note to the accounts of the DTC participants designated by the initial purchasers; and | | | • | ownership of beneficial interests in each Global Note will be shown on, and transfer of ownership of those interests will be effected only through, records maintained by DTC (with respect to interests of DTC |
74
| | | | | participants) and the records of DTC participants (with respect to other owners of beneficial interests in the Global Note). |
Beneficial interests in the Global Notes may not be exchanged for notes in certificated form except in the limited circumstances described below.
Exchanges Among the Global Notes
Beneficial interests in one Global Note may generally be exchanged for interests in another Global Note. Depending on the Global Note to which the transfer is being made, the Trustee may require the seller to provide certain written certifications in the form provided in the indenture. A beneficial interest in2011, a Global Note that is transferred to a person who takes delivery through another Global Note will, upon transfer, become subject to any transfer restrictions and other procedures applicable to beneficial interests in the other Global Note.
Book-Entry Procedures for the Global Notes
All interests in the Global Notes will be subject to the operations and procedures of DTC. We provide the following summary of those operations and procedures solely for the convenience of investors. The operations and procedures of each settlement system are controlled by that settlement system and may be changed at any time. We are not responsible for those operations or procedures.
DTC has advised us that it is:
| | | | • | a limited purpose trust company organized under the laws of the State of New York; | | | • | a “banking organization” within the meaning of the New York State Banking Law; | | | • | a member of the Federal Reserve System; | | | • | a “clearing corporation” within the meaning of the Uniform Commercial Code; and | | | • | a “clearing agency” registered under Section 17A of the Exchange Act. |
DTC was created to hold securities for its participants and to facilitate the clearance and settlement of securities transactions between its participants through electronic book-entry changes to the accounts of its participants. DTC’s participants include securities brokers and dealers, including the initial purchasers, banks and trust companies, clearing corporations and other organizations. Indirect access to DTC’s system is also available to others such as banks, brokers, dealers and trust companies; these indirect participants clear through or maintain a custodial relationship with a DTC participant, either directly or indirectly. Investors who are not DTC participants may beneficially own securities held by or on behalf of DTC only through DTC participants or indirect participants in DTC.
So long as DTC’s nominee is the registered owner of a Global Note, that nominee will be considered the sole owner or holder of the notes represented by that Global NoteConvertible Notes exchanged approximately $59.6 million in aggregate principal amount of the Convertible Notes for all purposes underapproximately 6.6 million shares of the Indenture. Except as provided below, ownersCompany’s common stock plus a payment for the accrued and unpaid interest. In the first quarter of beneficial interests in a Global Note:
| | | | • | will not be entitled to have notes represented by the Global Note registered in their names; | | | • | will not receive or be entitled to receive certificated notes; and | | | • | will not be considered the owners or holders of the notes under the indenture for any purposes, including with respect to the giving of any direction, instruction or approval to the Trustee under the indenture. |
As a result, each investor who owns a beneficial interest in a Global Note must rely on the procedures of DTC to exercise any rights of2013, a holder of notes under the indenture (and, ifConvertible Notes exchanged approximately $52.7 million in aggregate principal amount of the investor is not a participant or an indirect participant in DTC,Convertible Notes for approximately 4.9 million shares of the Company’s common stock plus cash consideration of approximately $14.2 million for the premium on the proceduresprincipal and unpaid interest to maturity. Following these exchanges, as of December 31, 2013 $60.2 million aggregate principal amount of the DTC participant throughConvertible Notes remains outstanding.Brazil Revolving Line of Credit The Company’s wholly-owned Brazilian subsidiary, Titan Pneus Do Brasil Ltda (Titan Brazil), has a revolving line of credit (Brazil line of credit) established with Bank of America Merrill Lynch Banco Multiplo S.A. in May 2011. Titan Brazil could borrow up to 16.0 million Brazilian Reais, which equates to approximately $6.8 million dollars as of December 31, 2013, for working capital purposes. Under the investor owns its interest). Payments of principal, premium (if any) and interest with respect to the exchange notes represented by a Global Note will be made by the Trustee to DTC’s nominee as the registered holderterms of the Global Note. Neither we nor the Trustee will haveBrazil line of credit, borrowings, if any, responsibility or liability for the paymentbear interest at a rate of amounts to owners1 month LIBOR plus 247 basis points. During 2013 and at December 31, 2013 there were no borrowings outstanding on this line of beneficial interests
75
credit. Australia Other DebtTitan National Australia Holdings has capital leases totaling $1.0 million at December 31, 2013. in a Global Note, for any aspect of the records relating to or payments made on account of those interests by DTC, or for maintaining, supervising or reviewing any records of DTC relating to those interests.
Payments by participants and indirect participants in DTC to the owners of beneficial interests in a Global Note will be governed by standing instructions and customary industry practice and will be the responsibility of those participants or indirect participants and DTC.
Titan Europe Other DebtTitan Europe has overdraft facilities totaling $53.4 million at December 31, 2013. Titan Europe Capital Leases Titan Europe has capital lease obligations totaling $2.4 million at December 31, 2013. Certificated Notes
Notes in certificated form will be issued and delivered to each person that DTC identifies as a beneficial owner of the related exchange notes only if:
| | | | • | DTC notifies us at any time that it is unwilling or unable to continue as depositary for the Global Notes and a successor depositary is not appointed within 120 days; | | | • | DTC ceases to be registered as a clearing agency under the Exchange Act and a successor depositary is not appointed within 120 days; | | | • | we, at our option, notify the Trustee that we elect to cause the issuance of certificated notes; or | | | • | certain other events provided in the indenture should occur. |
MATERIALCERTAIN UNITED STATES FEDERAL TAX CONSIDERATIONS
The following is a summary of the material U.S.certain United States federal income tax considerations relevantrelating to the exchange of your outstanding notesOutstanding Notes for exchange notesExchange Notes in the exchange offer and the ownership and disposition of exchange notes by an individual or entity who or that purchased notes in the offering for cash at original issue and holds the exchange notes as capital assets for purposes of the Internal Revenue Code. This summaryoffer. It does not purport to becontain a complete analysis of all the potential tax considerations relating to the exchangeexchange. This summary is limited to holders of outstanding notes who hold the outstanding notes as “capital assets” (in general, assets held for investment). Special situations, such as the following, are not addressed: tax consequences to holders who may be subject to special tax treatment, such as tax-exempt entities, dealers in securities or the exchange notes. The Code contains rules relating to securities held by special categories of holders, includingcurrencies, banks, other financial institutions, certain insurance companies, broker-dealers, tax-exempt organizations,regulated investment companies, traders in securities that elect to use a mark-to-market investors liable method of accounting for the alternative minimum their securities holdings or corporations that accumulate earnings to avoid United States federal income tax; tax investors that hold sharesconsequences to persons holding notes as part of a straddle or a hedging, integrated, constructive sale or conversion transaction and investorsor a straddle or other risk reduction transaction; tax consequences to holders whose functional currency“functional currency” is not the U.S. dollar. We do not discuss these rules and holdersUnited States dollar; tax consequences to persons who are in special categories should consult their ownhold notes through a partnership or similar pass-through entity; United States federal gift tax, advisors.estate tax or alternative minimum tax consequences, if any; or As used herein, “U.S. holders” are any beneficial ownersstate, local or non-United States tax consequences.
The discussion below is based upon the provisions of the notes, that are,United States Internal Revenue Code of 1986, as amended, existing and proposed Treasury regulations promulgated thereunder, and rulings, judicial decisions and administrative interpretations thereunder, as of the date hereof. Those authorities may be changed, perhaps retroactively, so as to result in United States federal income tax consequences different from those discussed below. Consequences of Tendering Outstanding Notes The exchange of your Outstanding Notes for Exchange Notes in the exchange offer should not constitute an exchange for United States federal income tax purposes (i) citizensbecause the Exchange Notes should not be considered to differ materially in kind or residents ofextent from the United States, (ii) corporations (or other entities treated as corporations foroutstanding notes. Accordingly, the exchange offer should have no United States federal income tax purposes) created or organizedconsequences to you if you exchange your Outstanding Notes for Exchange Notes. For example, there should be no change in or underyour tax basis and your holding period should carry over to the laws of, the United States, any state thereof or the District of Columbia, (iii) estates, the income of which is subject to United States federal income taxation regardless of its source, or (iv) trusts if (a) a court within the United States is able to exercise primary supervision over the administration of the trust and (b) one or more United States persons have the authority to control all substantial decisions of the trust.Exchange Notes. In addition, certain trusts in existence on August 20, 1996 and treated as U.S. persons prior to such date may also be treated as U.S. holders. As used herein,“non-U.S. holders” are beneficial owners of the notes, other than partnerships, that are not U.S. holders. If a partnership (including for this purpose any entity treated as a partnership for United States federal income tax purposes) is a beneficial owner of the notes, the treatment of a partner in the partnership will generally depend upon the status of the partner and upon the activities of the partnership. Partnerships and partners in such partnerships should consult their tax advisors about the United States federal income tax consequences of owningholding and disposing of the notes. This summary is based on the Code, the Treasury regulations promulgated thereunder and administrative and judicial interpretations thereof, all as of the date hereof, and all of which are subject to change or differing interpretations, possibly on a retroactive basis.
You should consult with your own tax advisor regarding the federal, state, local and foreign tax consequences of the ownership and disposition of the notes.
76
Internal Revenue Service Circular 230 Notice
To ensure compliance with Internal Revenue Service (“IRS”) Circular 230, holders of notes are hereby notified that: (A) any discussion of United States federal tax issues contained or referred to in this prospectus is not intended or written to be used, and cannot be used, by holders for the purpose of avoiding penalties that may be imposed on them under the Code; (B) such discussion is written in connection with the promotion or marketing of the transactions or matters addressed herein; and (C) holders should seek advice based on their particular circumstances from an independent tax advisor.
U.S. Holders
Exchange Offer. As a U.S. holder, you will not recognize taxable gain or loss from exchanging outstanding notes for exchange notes in the exchange offer. The holding period of the exchange notes will include the holding period of the outstanding notes that are exchanged for the exchange notes. The adjusted tax basis of the exchange notes will be the same as the adjusted tax basis of the outstanding notes exchanged for the exchange notes immediately before the exchange. Interest. If you are a U.S. holder, the stated interest on the exchange notes generally will be taxable to you as ordinary income at the time that it is paid or accrued, in accordance with your method of accounting for U.S. federal income tax purposes.
Sale, Exchange or Other Taxable Disposition of an Exchange Note. As a U.S. holder, you will recognize gain or loss on the sale, retirement, redemption or other taxable disposition of an exchange note in an amount equal to the difference between (1) the amount of cash and the fair market value of other property received in exchange for the exchange note, other than amounts for accrued but unpaid stated interest, which will be taxable as ordinary income to the extent not previously included in income, and (2) your adjusted tax basis in the exchange note. Any gain or loss recognized will generally be capital gain or loss. The capital gain or loss will generally be long-term capital gain or loss if you have held the exchange note for more than one year. Otherwise, the capital gain or loss will be a short-term capital gain or loss. The deductibility of capital losses is subject to limitations.
Liquidated Damages. We intend to take the position that any liquidated damages payable on a failure to meet our registration obligations will be taxable to you as ordinary income when received or accrued in accordance with your method of accounting for U.S. federal income tax purposes. This position is based in part on the assumption that, as of the date of issuance of the notes, the possibility that liquidated damages would have to be paid was a “remote” or “incidental” contingency within the meaning of applicable U.S. Treasury Regulations. Our determination that such possibility was a remote or incidental contingency is binding on you, unless you explicitly disclose that you are taking a different position to the IRS on your tax return for the year during which you acquire the note. The IRS, however, may take a different position, which could affect the timing and character of your income and our deduction with respect to payments of liquidated damages.
Optional Redemption. We, at our option, are entitled to redeem all or a portion of the exchange notes. U.S. Treasury Regulations contain special rules for determining the yield to maturity and maturity date on a debt instrument in the event the debt instrument provides for a contingency that could result in the acceleration or deferral of one or more payments. We believe that under these rules the redemption provisions of the exchange notes should not affect the computation of the yield to maturity or maturity date of the exchange notes.
Backup Withholding and Information Reporting. As a U.S. holder, you may be subject to information reporting and possible backup withholding. If applicable, backup withholding would apply to payments of interest on, or the proceeds of a sale, exchange, redemption, retirement, or other disposition of, an exchange note, unless you (1) are a corporation or come within other exempt categories and, when required, demonstrate this fact or (2) provide us or our agent with your taxpayer identification number, certify as to no loss of exemption from backup withholding, and otherwise comply with the backup withholding rules.
Backup withholding is not an additional tax but, rather, is a method of tax collection. You generally will be entitled to credit any amounts withheld under the backup withholding rules against your U.S. federal income tax liability provided that the required information is furnished to the IRS in a timely manner.
77
Non-U.S. Holders
Interest. If you are anon-U.S. holder, interest paid to you on the exchange notes will not be subject to U.S. federal withholding tax if:
| | | | • | you do not actually or constructively own 10% or more of the total combined voting power of all classes of our stock; | | | • | you are not a “controlled foreign corporation” for U.S. federal income tax purposes that is related to us, directly or indirectly, through stock ownership; | | | • | you are not a bank that holds the exchange note on an extension of credit made under a loan agreement entered into in the ordinary course of your trade or business; and | | | • | either (1) you, as the beneficial owner of the exchange note, provide us or our agent with a statement, on U.S. TreasuryForm W-8BEN or a suitable substitute form, signed under penalties of perjury that includes your name and address and certifies that you are not a U.S. person or (2) an exemption is otherwise established. If you hold your exchange notes through certain foreign intermediaries or certain foreign partnerships, such foreign intermediaries or partnerships must also satisfy the certification requirements of applicable U.S. Treasury Regulations. |
If these requirements are not met, you will be subject to U.S. withholding tax at a rate of 30% on interest payments on the exchange notes unless you provide us with a properly executed and updated (1) U.S. TreasuryForm W-8BEN (or successor form) claiming an exemption from or reduction in withholding under the benefit of an applicable U.S. income tax treaty or (2) U.S. TreasuryForm W-8ECI (or successor form) stating that the interest paid on the exchange note is not subject to withholding tax because it is effectively connected with the conduct of a U.S. trade or business.
In the event we are required to pay liquidated damages on the notes, as described above in “U.S. Holders — Liquidated Damages,” the tax treatment of such paymentNotes should be the same as other interest payments received by aNon-U.S. Holder. However, the IRS may treat such payments as other than interest, in which case they would be subjectthose applicable to U.S. withholding tax at a rateyour Outstanding Notes.The preceding discussion of 30%, unless the holder qualifies for a reduced rate of tax or an exemption under an applicable U.S. income tax treaty. If you are engaged in a trade or business in the U.S. and interest on an exchange note is effectively connected with your conduct of that trade or business, you will be required to pay U.S. federal income tax on that interest on a net income basis (although payments to you will be exempt from the 30% U.S. federal withholding tax, provided the certification requirements described above are satisfied) in the same manner as if you were a U.S. person as defined under the U.S. Internal Revenue Code.
If you are eligible for the benefit of a tax treaty, effectively connected income generally will be subject to U.S. federal income tax only if it is attributable to a “permanent establishment” in the U.S. In addition, if you are a foreign corporation, you may be required to pay a branch profits tax equal to 30% (or lower rate as may be prescribed under an applicable U.S. income tax treaty) of your earnings and profits for the taxable year, subject to adjustments, that are effectively connected with your conduct of a trade or business in the U.S., provided the required information is properly furnished to the IRS.
Sale, Exchange or Other Taxable Disposition of an Exchange Note. As anon-U.S. holder, gain realized by you on the sale, exchange or redemption of an exchange note (except, in the case of redemptions, with respect to accrued and unpaid interest, which would be taxable as described above) generally will not be subject to U.S. federal withholding tax. However, gain will be subject to U.S. federal income tax if (1) the gain is effectively connected with your conduct of a trade or business in the U.S., (2) you are an individual who is present in the U.S. for a total of 183 days or more during the taxable year in which the gain is realized and other conditions are satisfied, or (3) you are subject to tax under U.S. tax laws that apply to certain U.S. expatriates. If you are described in clause (1) above, you generally will be required to pay U.S. federal income tax on the net gain derived from the sale. If you are a corporation, then you may be required to pay a branch profits tax at a 30% rate (or such lower rate as may be prescribed under an applicable U.S. income tax treaty) on any such effectively connected gain. If you are described in clause (2) above, you will be subject to a flat 30% United States federal income tax on the gain derived
78
from the sale, which may be offset by United States source capital losses, even though you are not considered a residentconsiderations of the United States. If you are a holder described in clause (3) above, youexchange offer is for general information only and is not tax advice. Accordingly, each investor should consult yourits own tax advisor as to determineparticular tax consequences to it of exchanging Outstanding Notes for Exchange Notes, including the U.S. federal,applicability and effect of any state, local and otheror foreign tax consequences that may be relevant to you.
Backup Withholdinglaws, and Information Reporting. The amount of any interest paid to, and the tax withheld with respect to, anon-U.S. holder, must generally be reported annually to the IRS and to suchnon-U.S. holder, regardless of whether any tax was actually withheld.
Payments on the exchange notes made by us or our paying agent to noncorporatenon-U.S. holders may be subject to information reporting and possibly to backup withholding. Information reporting and backup withholding generally do not apply, however, to payments made by us or our paying agent on an exchange note if we (1) have received from you the U.S. TreasuryForm W-8BEN or a suitable substitute form as described above under“Non-U.S. Holders — Interest,”or otherwise establish an exemption and (2) do not have actual knowledge or have reason to know that you are a U.S. holder.
Payment of proceeds from a sale of an exchange note to or through the U.S. office of a broker is subject to information reporting and backup withholding unless you certify as to yournon-U.S. status or otherwise establish an exemption from information reporting and backup withholding and the broker does not have actual knowledge or have reason to know that you are a U.S. holder. Payment outside the U.S. of the proceeds of the sale of an exchange note to or through a foreign office of a “broker,” as definedproposed changes in the applicable U.S. Treasury Regulations, should not be subject to information reporting or backup withholding. However, U.S. information reporting, but not backup withholding, generally will apply to a payment made outside the U.S. of the proceeds of a sale of an exchange note through an office outside the U.S. of a broker if the broker:
| | | | • | is a U.S. person; | | | • | is a foreign person who derives 50% or more of its gross income from the conduct of a U.S. trade or business; | | | • | is a “controlled foreign corporation” for U.S. federal income tax purposes; or | | | • | is a foreign partnership, if at any time during its taxable year, one or more of its partners are U.S. persons, as defined in U.S. Treasury Regulations, who in the aggregate hold more than 50% of the income or capital interest in the partnership or if, at any time during its taxable year, the foreign partnership is engaged in a U.S. trade or business. |
However, information reporting will not apply if (1) you certify as to yournon-U.S. status or the broker has documentary evidence in its records that you are anon-U.S. holder, and certain other conditions are met or (2) an exemption is otherwise established.
Any amounts withheld from a payment to you under the backup withholding rules of the U.S. Treasury Regulations will be allowed as a refund or credit against your U.S. federal income tax liability, provided that you follow the requisite procedures. laws.
PLAN OF DISTRIBUTION Each broker-dealer that receives exchange notesExchange Notes for its own account in connection with the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of those exchange notes.Exchange Notes. A broker-dealer may use this prospectus, as amended or supplemented from time to time, in connection with resales of exchange notesExchange Notes received in exchange for outstanding notesOutstanding Notes where the broker-dealer acquired outstanding notesOutstanding Notes as a result of market-making activities or other trading activities. We have agreed that we will make available this prospectus, as amended or supplemented, to any broker-dealer for use in connection with resales for a period ending on the earlier of 180 days after the date on which the registration statement is declared effective and the date on which broker-dealers are no longer required to deliver a prospectus in connection with market making or other trading activities. We are conducting the exchange offer to satisfy our obligations under the exchange and registration rights agreement entered into in connection with the private placement of the outstanding notes,Outstanding Notes, and we will not receive any proceeds from the issuance of the exchange notesExchange Notes pursuant to the terms of the exchange offer, or from the subsequent sale of the
79
exchange notes Exchange Notes by any holder thereof. Broker-dealers may sell exchange notesExchange Notes received by them for their own account pursuant to the exchange offer from time to time in one or more transactions in theover-the-counter market, in negotiated transactions, through the writing of options on the exchange notesExchange Notes or a combination of those methods of resale, at market prices prevailing at the time of resale, at prices related to those prevailing market prices or negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any broker-dealer or the purchasers of any exchange notes.
Exchange Notes.Any broker-dealer that resells exchange notesExchange Notes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of such exchange notesExchange Notes may be deemed to be an underwriter within the meaning of the Securities Act. A profit on any such resale of exchange notesExchange Notes and any commissions or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that by acknowledging it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an underwriter within the meaning of the Securities Act. We have agreed to pay all expenses incident to the exchange offer, other than commissions or concessions of any brokers or dealers. We will also indemnify the holders of the outstanding notes,Outstanding Notes, including any broker-dealers, against specified liabilities, including certain liabilities under the Securities Act.
LEGAL MATTERS The validityDavis & Gilbert LLP, New York, New York, will pass upon certain legal matters under New York law for us regarding the Exchange Notes and the guarantees. In rendering its opinion, Davis & Gilbert LLP will rely on the opinion of Schmiedeskamp, Robertson, Neu & Mitchell LLP, Quincy, Illinois, as to all matters governed by the laws of the issuanceState of Illinois, and the opinion of Burkey, Burkey & Scher, Co., LPA, Warren, Ohio, as to all matters governed by the laws of the exchange notes will be passed upon for us by Bodman LLP, Detroit, Michigan. State of Ohio.
EXPERTS The December 31, 2013 and 2012 audited financial statements and schedules, and management’s assessment of the effectiveness of internal control over financial reporting (which is includedincorporated by reference in Management’s Report on Internal Control over Financial Reporting)this prospectus have been so incorporated in reliance upon the report of Grant Thornton LLP, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing in giving said report. The financial statements for the year ended December 31, 2011 incorporated in this prospectus by reference to Titan International, Inc.’s Current Report onForm 8-K dated November 2, 2010 and the financial statement schedule incorporated in this prospectusProspectus by reference to the Annual Report onForm 10-K of Titan International, Inc. for the year ended December 31, 20092013 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
80
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS | | Item 20. | Indemnification of Directors and Officers |
Item 20. Indemnification of Directors and Officers Registrants Titan International, Inc., Titan Wheel Corporation of Illinois, Titan Tire Corporation, and Titan Tire Corporation of Freeport (collectively, the “Illinois Registrants”) are each incorporated under the laws of the State of Illinois. Titan Tire Corporation of Bryan (the “Ohio Registrant”) is incorporated under the laws of the State of Ohio. Section 8.75 of the Illinois Business Corporation Act of 1983, as amended (the “IBCA”) and the Illinois Registrants’ By-Laws provide for indemnification of our directors and officers and certain other persons, and Article Five of the Articles of Incorporation of Titan International, Inc. provides for a limitation of director liability. Under Section 8.75 of the IBCA, directors and officers of the Illinois Registrants may be indemnified by the applicable corporation against all expenses incurred in connection with actions (including, under certain circumstances, derivative actions) brought against such director or officer by reason of his or her status as our representative, or by reason of the fact that such director or officer serves or served as a representative of another entity at our request, so long as the director or officer acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, our best interests. As permitted under Section 8.75 of the IBCA, the By-Laws of each of the Illinois Registrants provide that the applicable corporation shall indemnify directors and officers against all expenses incurred in connection with actions (including derivative actions) brought against such director or officer by reason of the fact that he or she is or was our director or officer, or by reason of the fact that such director or officer serves or served as an employee or agent of any entity at our request, unless in the case of a derivative action the act or failure to act on the part of the director or officer giving rise to the claim for indemnification is determined by a court in a final, binding adjudication to have constituted misconduct. The Articles of Incorporation of Titan International, Inc. limit the liability of a director to it or its stockholders for monetary damages for breach of fiduciary duty as a director, provided, however, that the Articles do not eliminate or limit director liability for any breach of the director’s duty of loyalty to it or its stockholders, for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, under Section 8.65 of the IBCA (relating to unlawful distributions), or for any transaction from which the director derived an improper personal benefit. Section 1701.13(E) of the Ohio General Corporation Law, as amended (the “OGCL”) and the Ohio Registrant’s By-Laws provide for indemnification of our directors and officers and certain other persons. Under Section 1701.13(E) of the OGCL, directors and officers of the Ohio Registrant may be indemnified by the corporation against all expenses incurred in connection with actions (including, under certain circumstances, derivative actions) brought against such director or officer by reason of his or her status as our representative, or by reason of the fact that such director or officer serves or served as a representative of another entity at our request, so long as the director or officer acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, our best interests. As permitted under Section 1701.13(E) of the OGCL, the By-Laws of the Ohio Registrant provide that it shall indemnify directors and officers against all expenses incurred in connection with actions (including derivative actions) brought against such director or officer by reason of the fact that he or she is or was our director or officer, or by reason of the fact that such director or officer serves or served as an employee or agent of any entity at our request, unless in the case of a derivative action the act or failure to act on the part of the director or officer giving rise to the claim for indemnification is determined by a court in a final, binding adjudication to have constituted misconduct. II-1
Insurance is maintained on a regular basis against liabilities arising on the part of our directors and officers out of their performance in such capacities or arising on our part out of the foregoing indemnification provisions, subject to certain exclusions and to the policy limits.
II-1
II-2
Item 21. Exhibits and Financial Statement Schedules | | Item 21. | Exhibits and Financial Statement Schedules |
(a) The following exhibits are filed as part of this registration statement: | | | | | | | | | | | | | Incorporated by
| | | Exhibit
| | | | Reference to
| | | No. | | Description | | Exhibit No. | | File No. | | | 3 | .1 | | Amended and Restated Articles of Incorporation of Titan International, Inc., as amended | | 3 to Form 10-Q filed on October 28, 2010 | | 001-12936 | | 3 | .2 | | Bylaws of Titan International, Inc. | | 3.2 to Form S-4 filed on September 22, 1993 | | 33-69228 | | 3 | .3 | | Articles of Incorporation of Titan Wheel Corporation of Illinois | | 3.5 to Form S-4 filed on April 4, 2007 | | 333-141865 | | 3 | .4 | | Bylaws of Titan Wheel Corporation of Illinois | | 3.6 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .5 | | Articles of Incorporation of Titan Tire Corporation | | 3.15 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .6 | | Bylaws of Titan Tire Corporation | | 3.16 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .7 | | Articles of Incorporation of Titan Tire Corporation of Bryan | | 3.17 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .8 | | Bylaws of Titan Tire Corporation of Bryan | | 3.18 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .9 | | Articles of Incorporation of Titan Tire Corporation of Freeport | | 3.19 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .10 | | Bylaws of Titan Tire Corporation of Freeport | | 3.20 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 4 | .1 | | Indenture dated as of October 1, 2010 among Titan International, Inc., the Guarantors party thereto, and U.S. Bank National Association, as Trustee and Collateral Trustee | | 4.1 to Form 8-K filed on October 5, 2010 | | 001-12936 | | 4 | .2 | | Exchange and Registration Rights Agreement dated as of October 1, 2010 by and among Titan International, Inc., the Guarantors party thereto, and Goldman, Sachs & Co., as representative of the Initial Purchasers identified therein | | * | | | | 4 | .3 | | Form of 7.875% Senior Secured Notes due 2017 | | (included as Exhibit A to Exhibit 4.1) | | | | 4 | .4 | | Form of Guarantee relating to 7.875% Senior Secured Notes due 2017 | | (included as Exhibit D to Exhibit 4.1) | | | | 5 | .1 | | Opinion of Bodman LLP | | * | | | | 5 | .2 | | Opinion of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | * | | |
II-2
| | | | | | | | | | | | | Incorporated by
| | | Exhibit
| | | | Reference to
| | | No. | | Description | | Exhibit No. | | File No. | | | 8 | .1 | | Tax Opinion of Bodman LLP | | * | | | | 12 | .1 | | Computation of Ratio of Earnings to Fixed Charges | | * | | | | 21 | .1 | | Subsidiaries of Titan International, Inc. | | 21 to Form 10-K filed on February 25, 2010 | | 001-12936 | | 23 | .1 | | Consent of PricewaterhouseCoopers LLP, independent auditors for the Registrant | | * | | | | 23 | .2 | | Consent of Bodman LLP | | (contained in Exhibit 5.1) | | | | 23 | .3 | | Consent of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | (contained in Exhibit 5.2) | | | | 24 | .1 | | Powers of Attorney | | (included on signature pages) | | | | 25 | .1 | | Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of U.S. Bank National Association, as Trustee, onForm T-1, relating to the 7.875% Senior Secured Notes due 2017 | | * | | | | 99 | .1 | | Form of Letter of Transmittal and Consent | | * | | | | 99 | .2 | | Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees | | * | | | | 99 | .3 | | Form of Letter to Clients | | * | | |
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 3.1 | | Amended and Restated Articles of Incorporation of Titan International, Inc., as amended | | 3 to Form 10-Q filed on October 28, 2010 | | 1-12936 | | | | | 3.2 | | Bylaws of Titan International, Inc. | | 3.2 to Form 10-K filed on February 20, 2014 | | 1-12936 | | | | | 3.3 | | Articles of Incorporation of Titan Wheel Corporation of Illinois | | 3.5 to Form S-4 filed on April 4, 2007 | | 333-141865 | | | | | 3.4 | | Bylaws of Titan Wheel Corporation of Illinois | | 3.6 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.5 | | Articles of Incorporation of Titan Tire Corporation | | 3.15 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.6 | | Bylaws of Titan Tire Corporation | | 3.16 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.7 | | Articles of Incorporation of Titan Tire Corporation of Bryan | | 3.17 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.8 | | Bylaws of Titan Tire Corporation of Bryan | | 3.18 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.9 | | Articles of Incorporation of Titan Tire Corporation of Freeport | | 3.19 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.10 | | Bylaws of Titan Tire Corporation of Freeport | | 3.20 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 4.1 | | Indenture between the Company and U.S. Bank National Association dated December 21, 2009 | | 4.1 to Form 8-K filed on December 21, 2009 | | 1-12936 | | | | | 4.2 | | Indenture dated as of October 7, 2013 among the Company, the Guarantors party thereto, and U.S. Bank National Association, as Trustee and Collateral Trustee | | 4.1 to Form 8-K filed on October 7, 2013 | | 1-12936 |
II-3
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 4.3 | | Registration Rights Agreement dated as of October 7, 2013, by and among the Company, the Guarantors party thereto, and Goldman, Sachs & Co. and Jefferies LLC as representatives of the Initial Purchasers identified therein | | 4.2 to Form 8-K filed on October 7, 2013 | | 1-12936 | | | | | 4.4 | | Form of 6.875% Senior Secured Notes due 2020 | | (included as Exhibits A1 and A2 to Exhibit 4.2) | | | | | | | 4.5 | | Form of Guarantee relating to 6.875% Senior Secured Notes due 2020 | | (included as Exhibit D to Exhibit 4.2) | | | | | | | 5.1 | | Opinion of Davis & Gilbert LLP | | * | | | | | | | 5.2 | | Opinion of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | * | | | | | | | 5.3 | | Opinion of Burkey, Burkey & Scher, Co., LPA | | * | | | | | | | 10.1 | | 2005 Equity Incentive Plan as Amended | | Appendix A of the Definitive Proxy Statement filed on March 28, 2011 | | 1-12936 | | | | | 10.2 | | Maurice M. Taylor, Jr. Employment Agreement | | 10.2 to Form 10-Q for the quarterly period ended June 30, 2006 | | 1-12936 | | | | | 10.3 | | Maurice M. Taylor, Jr. Employment Agreement Amendment | | 10.3 to Form 10-K for the year ended December 31, 2010 | | 1-12936 | | | | | 10.4 | | Paul G. Reitz Employment Agreement | | 10.4 to Form 8-K filed on March 23, 2011 | | 1-12936 | | | | | 10.5 | | Trademark License Agreement with The Goodyear Tire & Rubber Company** | | 10.5 to Form 10-Q for the quarterly period ended September 30, 2010 | | 1-12936 | | | | | 10.6 | | Wheel Purchase Agreement with Deere & Company – November 2010** | | 10.6 to Form 10-K for the year ended December 31, 2010 | | 1-12936 | | | | | 10.7 | | Supply Agreement with Deere & Company – August 2011** | | 10.7 to Form 10-Q for the quarterly period ended September 30, 2011 | | 1-12936 |
II-4
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 10.8 | | First Amendment to Supply Agreement with Deere & Company – September 2011** | | 10.8 to Form 10-Q for the quarterly period ended September 30, 2011 | | 1-12936 | | | | | 10.9 | | Maurice M. Taylor, Jr. Employment Agreement Amendment | | 10.9 to Form 8-K filed on February 15, 2012 | | 1-12936 | | | | | 10.10 | | Second Amended and Restated Credit Agreement among the Company and Bank of America, N.A. dated as of December 21, 2012 | | 10.1 to Form 10-Q filed on July 24, 2013 | | 1-12936 | | | | | 10.11 | | Titan International, Inc. Executive Short-Term Incentive Plan | | Appendix A of the Definitive Proxy Statement filed on April 5, 2013 | | 1-12936 | | | | | 10.12 | | John Hrudicka Employment Agreement | | Exhibit 10.1 to Form 8-K filed on January 28, 2014 | | | | | | | 12.1 | | Computation of Ratio of Earnings to Fixed Charges | | * | | | | | | | 21.1 | | Subsidiaries of Titan International, Inc. | | 21 to Form 10-K filed on February 20, 2014 | | 1-12936 | | | | | 23.1 | | Consent of Grant Thornton LLP | | * | | | | | | | 23.2 | | Consent of PricewaterhouseCoopers LLP | | * | | | | | | | 23.3 | | Consent of Davis & Gilbert LLP | | (contained in Exhibit 5.1) | | | | | | | 23.4 | | Consent of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | (contained in Exhibit 5.2) | | | | | | | 23.5 | | Consent of Burkey, Burkey & Scher, Co., LPA | | (contained in Exhibit 5.3) | | | | | | | 24.1 | | Powers of Attorney | | (included on signature pages) | | | | | | | 25.1 | | Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of U.S. Bank National Association, as Trustee, on Form T-1, relating to the 6.875% Senior Secured Notes due 2020 | | * | | | | | | | 99.1 | | Form of Letter of Transmittal and Consent | | * | | |
II-5
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 99.2 | | Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees | | * | | | | | | | 99.3 | | Form of Letter to Clients | | * | | |
** | | Item 22. | UndertakingsConfidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission. |
II-6
Item 22. Undertakings (a) The undersigned registrants hereby undertake: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for the purpose of determining liability under the Securities Act to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. II-3
Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. (5) That, for the purpose of determining liability of the registrants under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, each of the undersigned registrants undertakes that in a primary offering of securities of the undersigned registrants pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrants will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: (i) Any preliminary prospectus or prospectus of the undersigned registrants relating to the offering required to be filed pursuant to Rule 424; (ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrants or used or referred to by the undersigned registrants; (iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrants or its securities provided by or on behalf of the undersigned registrants; and (iv) Any other communication that is an offer in the offering made by the undersigned registrants to the purchaser. (b) Each of the undersigned Registrants hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrants pursuant to the foregoing provisions, or otherwise, the undersigned registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the II-7
registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. (d)(c) The undersigned registrantsregistrant hereby undertake: (1) Toundertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to ItemItems 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in the documents filed subsequent to the effective date of the registration statement through the date of responding to the request.
(2) To(d) The undersigned registrants hereby undertake to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. [The remainder of this page is intentionally left blank.]
II-4
II-8
SIGNATURES SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Quincy, Illinois, on November 2, 2010. March 24, 2014.TITAN INTERNATIONAL, INC.
| | | TITAN INTERNATIONAL, INC. | | | By: | | /s/ Maurice M. Taylor Jr. | | | Maurice M. Taylor Jr. | | | Chairman and Chief Executive Officer | | | (Principal Executive Officer) |
Maurice M. Taylor Jr.
Chairman and Chief Executive Officer
(Principal Executive Officer)
The undersigned directorsand/or officers of Titan International, Inc., an Illinois corporation (the “Registrant”), do hereby make, constitute and appoint Cheri T. HolleyMichael G. Troyanovich and Paul G. Reitz,John R. Hrudicka, and each of them, the undersigned’s true and lawful attorneys-in-fact, with full power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such directorand/or officer of the Registrant to the Registrant’s Registration Statement onForm S-4, or any other appropriate form, for the purpose of registering, pursuant to the Securities Act of 1933, its securities, and to sign any and all amendments or any and all post-effective amendments to such Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and any other regulatory body pertaining to the Registration Statement or the securities covered thereby, granting unto said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed on November 2, 2010March 24, 2014 by the following persons in the capacities indicated. /s/ Maurice M. Taylor Jr.
Maurice M. Taylor Jr.
Chairman and Chief Executive Officer
Paul G. Reitz
Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
J. Michael A. Akers, Director
Erwin H. Billig, Director
II-5
| /s/ Maurice M. Taylor Jr. | Maurice M. Taylor Jr. | Chairman and Chief Executive Officer | | /s/ John R. Hrudicka | John R. Hrudicka | Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer) | | /s/ Erwin H. Billig | Erwin H. Billig, Director | | /s/ Richard M. Cashin, Jr. | Richard M. Cashin, Jr., Director | | /s/ Gary L. Cowger | Gary L. Cowger, Director | | /s/ Albert J. Febbo | Albert J. Febbo, Director | | /s/ Peter McNitt | Peter McNitt, Director | | /s/ Anthony L. Soave | Anthony L. Soave, Director |
II-9
SIGNATURES /s/ Richard M. Cashin, Jr.
Richard M. Cashin, Jr., Director
Albert J. Febbo, Director
Mitchell I. Quain, Director
Anthony L. Soave, Director
II-6
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Quincy, Illinois, on November 2, 2010. March 24, 2014.TITAN TIRE CORPORATION
| | | TITAN TIRE CORPORATION | | | By: | | /s/ Maurice M. Taylor Jr. | | | Maurice M. Taylor Jr. | | | Chief Executive Officer | | | (Principal Executive Officer) |
Maurice M. Taylor Jr.
Chief Executive Officer
(Principal Executive Officer)
POWER OF ATTORNEY The undersigned directors and/or officers of Titan Tire Corporation, an Illinois corporation (the “Registrant”), do hereby make, constitute and appoint Michael G. Troyanovich and John R. Hrudicka, and each of them, the undersigned’s true and lawful attorneys-in-fact, with full power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director and/or officer of the Registrant to the Registrant’s Registration Statement on Form S-4, or any other appropriate form, for the purpose of registering, pursuant to the Securities Act of 1933, its securities, and to sign any and all amendments or any and all post-effective amendments to such Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and any other regulatory body pertaining to the Registration Statement or the securities covered thereby, granting unto said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed on November 2, 2010March 24, 2014 by the following persons in the capacities indicated. /s/ Maurice M. Taylor Jr.
Maurice M. Taylor Jr.
Chief Executive Officer and Director
(Principal Executive Officer)
II-7
| | | /s/ Maurice M. Taylor Jr. | Maurice M. Taylor Jr. | Chief Executive Officer and Director | (Principal Executive Officer) | | /s/ John R. Hrudicka | John R. Hrudicka | Chief Financial Officer | (Principal Financial Officer and Accounting Officer) |
II-10
SIGNATURES SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Quincy, Illinois, on November 2, 2010. March 24, 2014.TITAN WHEEL CORPORATION OF ILLINOIS
| | | TITAN WHEEL CORPORATION OF ILLINOIS | | | By: | | /s/ Maurice M. Taylor Jr. | | | Maurice M. Taylor Jr. | | | Chief Executive Officer | | | (Principal Executive Officer) |
Maurice M. Taylor Jr.
Chief Executive Officer
(Principal Executive Officer)
POWER OF ATTORNEY The undersigned directors and/or officers of Titan Wheel Corporation of Illinois, an Illinois corporation (the “Registrant”), do hereby make, constitute and appoint Michael G. Troyanovich and John R. Hrudicka, and each of them, the undersigned’s true and lawful attorneys-in-fact, with full power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director and/or officer of the Registrant to the Registrant’s Registration Statement on Form S-4, or any other appropriate form, for the purpose of registering, pursuant to the Securities Act of 1933, its securities, and to sign any and all amendments or any and all post-effective amendments to such Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and any other regulatory body pertaining to the Registration Statement or the securities covered thereby, granting unto said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed on November 2, 2010March 24, 2014 by the following persons in the capacities indicated. /s/ Maurice M. Taylor Jr.
Maurice M. Taylor Jr.
Chief Executive Officer and Director
(Principal Executive Officer)
II-8
| /s/ Maurice M. Taylor Jr. | Maurice M. Taylor Jr. | Chief Executive Officer and Director | (Principal Executive Officer) | | /s/ John R. Hrudicka | John R. Hrudicka | Chief Financial Officer | (Principal Financial Officer and Accounting Officer) |
II-11
SIGNATURES SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Quincy, Illinois, on November 2, 2010. March 24, 2014.TITAN TIRE CORPORATION OF BRYAN
| | | TITAN TIRE CORPORATION OF BRYAN | | | By: | | /s/ Maurice M. Taylor Jr. | | | Maurice M. Taylor Jr. | | | Chief Executive Officer | | | (Principal Executive Officer) |
Maurice M. Taylor Jr.
Chief Executive Officer
(Principal Executive Officer)
POWER OF ATTORNEY The undersigned directors and/or officers of Titan Tire Corporation of Bryan, an Ohio corporation (the “Registrant”), do hereby make, constitute and appoint Michael G. Troyanovich and John R. Hrudicka, and each of them, the undersigned’s true and lawful attorneys-in-fact, with full power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director and/or officer of the Registrant to the Registrant’s Registration Statement on Form S-4, or any other appropriate form, for the purpose of registering, pursuant to the Securities Act of 1933, its securities, and to sign any and all amendments or any and all post-effective amendments to such Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and any other regulatory body pertaining to the Registration Statement or the securities covered thereby, granting unto said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed on November 2, 2010March 24, 2014 by the following persons in the capacities indicated. /s/ Maurice M. Taylor Jr.
Maurice M. Taylor Jr.
Chief Executive Officer and Director
(Principal Executive Officer)
II-9
| /s/ Maurice M. Taylor Jr. | Maurice M. Taylor Jr. | Chief Executive Officer and Director | (Principal Executive Officer) | | /s/ John R. Hrudicka | John R. Hrudicka | Chief Financial Officer | (Principal Financial Officer and Accounting Officer) |
II-12
SIGNATURES SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Quincy, Illinois, on November 2, 2010. March 24, 2014.TITAN TIRE CORPORATION OF FREEPORT
| | | TITAN TIRE CORPORATION OF FREEPORT | | | By: | | /s/ Maurice M. Taylor Jr. | | | Maurice M. Taylor Jr. | | | Chief Executive Officer | | | (Principal Executive Officer) |
Maurice M. Taylor Jr.
Chief Executive Officer
(Principal Executive Officer)
POWER OF ATTORNEY The undersigned directors and/or officers of Titan Tire Corporation of Freeport, an Illinois corporation (the “Registrant”), do hereby make, constitute and appoint Michael G. Troyanovich and John R. Hrudicka, and each of them, the undersigned’s true and lawful attorneys-in-fact, with full power of substitution, for the undersigned and in the undersigned’s name, place and stead, to sign and affix the undersigned’s name as such director and/or officer of the Registrant to the Registrant’s Registration Statement on Form S-4, or any other appropriate form, for the purpose of registering, pursuant to the Securities Act of 1933, its securities, and to sign any and all amendments or any and all post-effective amendments to such Registration Statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and any other regulatory body pertaining to the Registration Statement or the securities covered thereby, granting unto said attorneys-in-fact, and each of them, full power and authority to do and perform any and all acts necessary or incidental to the performance and execution of the powers herein expressly granted. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed on November 2, 2010March 24, 2014 by the following persons in the capacities indicated. /s/ Maurice M. Taylor Jr.
Maurice M. Taylor Jr.
Chief Executive Officer and Director
(Principal Executive Officer)
II-10
| /s/ Maurice M. Taylor Jr. | Maurice M. Taylor Jr. | Chief Executive Officer and Director | (Principal Executive Officer) | | /s/ John R. Hrudicka | John R. Hrudicka | Chief Financial Officer | (Principal Financial Officer and Accounting Officer) |
II-13
EXHIBIT INDEX | | | | | | | | | | | | | Incorporated by
| | | Exhibit
| | | | Reference to
| | | No. | | Description | | Exhibit No. | | File No. | | | 3 | .1 | | Amended and Restated Articles of Incorporation of Titan International, Inc., as amended | | 3 to Form 10-Q filed on October 28, 2010 | | 001-12936 | | 3 | .2 | | Bylaws of Titan International, Inc. | | 3.2 to Form S-4 filed on September 22, 1993 | | 33-69228 | | 3 | .3 | | Articles of Incorporation of Titan Wheel Corporation of Illinois | | 3.5 to Form S-4 filed on April 4, 2007 | | 333-141865 | | 3 | .4 | | Bylaws of Titan Wheel Corporation of Illinois | | 3.6 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .5 | | Articles of Incorporation of Titan Tire Corporation | | 3.15 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .6 | | Bylaws of Titan Tire Corporation | | 3.16 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .7 | | Articles of Incorporation of Titan Tire Corporation of Bryan | | 3.17 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .8 | | Bylaws of Titan Tire Corporation of Bryan | | 3.18 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .9 | | Articles of Incorporation of Titan Tire Corporation of Freeport | | 3.19 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 3 | .10 | | Bylaws of Titan Tire Corporation of Freeport | | 3.20 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | 4 | .1 | | Indenture dated as of October 1, 2010 among Titan International, Inc., the Guarantors party thereto, and U.S. Bank National Association, as Trustee and Collateral Trustee | | 4.1 to Form 8-K filed on October 5, 2010 | | 001-12936 | | 4 | .2 | | Exchange and Registration Rights Agreement dated as of October 1, 2010 by and among Titan International, Inc., the Guarantors party thereto, and Goldman, Sachs & Co., as representative of the Initial Purchasers identified therein | | * | | | | 4 | .3 | | Form of 7.875% Senior Secured Notes due 2017 | | (included as Exhibit A to Exhibit 4.1) | | | | 4 | .4 | | Form of Guarantee relating to 7.875% Senior Secured Notes due 2017 | | (included as Exhibit D to Exhibit 4.1) | | | | 5 | .1 | | Opinion of Bodman LLP | | * | | | | 5 | .2 | | Opinion of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | * | | | | 8 | .1 | | Tax Opinion of Bodman LLP | | * | | | | 12 | .1 | | Computation of Ratio of Earnings to Fixed Charges | | * | | | | 21 | .1 | | Subsidiaries of Titan International, Inc. | | 21 to Form 10-K filed on February 25, 2010 | | 001-12936 | | 23 | .1 | | Consent of PricewaterhouseCoopers LLP, independent auditors for the Registrant | | * | | |
| | | | | | | | | | | | | Incorporated by
| | | Exhibit
| | | | Reference to
| | | No. | | Description | | Exhibit No. | | File No. | | | 23 | .2 | | Consent of Bodman LLP | | (contained in Exhibit 5.1) | | | | 23 | .3 | | Consent of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | (contained in Exhibit 5.2) | | | | 24 | .1 | | Powers of Attorney | | (included on signature pages) | | | | 25 | .1 | | Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of U.S. Bank National Association, as Trustee, onForm T-1, relating to the 7.875% Senior Secured Notes due 2017 | | * | | | | 99 | .1 | | Form of Letter of Transmittal and Consent | | * | | | | 99 | .2 | | Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees | | * | | | | 99 | .3 | | Form of Letter to Clients | | * | | |
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 3.1 | | Amended and Restated Articles of Incorporation of Titan International, Inc., as amended | | 3 to Form 10-Q filed on October 28, 2010 | | 1-12936 | | | | | 3.2 | | Bylaws of Titan International, Inc. | | 3.2 to Form 10-K filed on February 20, 2014 | | 1-12936 | | | | | 3.3 | | Articles of Incorporation of Titan Wheel Corporation of Illinois | | 3.5 to Form S-4 filed on April 4, 2007 | | 333-141865 | | | | | 3.4 | | Bylaws of Titan Wheel Corporation of Illinois | | 3.6 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.5 | | Articles of Incorporation of Titan Tire Corporation | | 3.15 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.6 | | Bylaws of Titan Tire Corporation | | 3.16 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.7 | | Articles of Incorporation of Titan Tire Corporation of Bryan | | 3.17 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.8 | | Bylaws of Titan Tire Corporation of Bryan | | 3.18 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.9 | | Articles of Incorporation of Titan Tire Corporation of Freeport | | 3.19 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 3.10 | | Bylaws of Titan Tire Corporation of Freeport | | 3.20 to Form S-4 filed on filed on April 4, 2007 | | 333-141865 | | | | | 4.1 | | Indenture between the Company and U.S. Bank National Association dated December 21, 2009 | | 4.1 to Form 8-K filed on December 21, 2009 | | 1-12936 | | | | | 4.2 | | Indenture dated as of October 7, 2013 among the Company, the Guarantors party thereto, and U.S. Bank National Association, as Trustee and Collateral Trustee | | 4.1 to Form 8-K filed on October 7, 2013 | | 1-12936 |
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 4.3 | | Registration Rights Agreement dated as of October 7, 2013, by and among the Company, the Guarantors party thereto, and Goldman, Sachs & Co. and Jefferies LLC as representatives of the Initial Purchasers identified therein | | 4.2 to Form 8-K filed on October 7, 2013 | | 1-12936 | | | | | 4.4 | | Form of 6.875% Senior Secured Notes due 2020 | | (included as Exhibits A1 and A2 to Exhibit 4.2) | | | | | | | 4.5 | | Form of Guarantee relating to 6.875% Senior Secured Notes due 2020 | | (included as Exhibit D to Exhibit 4.2) | | | | | | | 5.1 | | Opinion of Davis & Gilbert LLP | | * | | | | | | | 5.2 | | Opinion of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | * | | | | | | | 5.3 | | Opinion of Burkey, Burkey & Scher, Co., LPA | | * | | | | | | | 10.1 | | 2005 Equity Incentive Plan as Amended | | Appendix A of the Definitive Proxy Statement filed on March 28, 2011 | | 1-12936 | | | | | 10.2 | | Maurice M. Taylor, Jr. Employment Agreement | | 10.2 to Form 10-Q for the quarterly period ended June 30, 2006 | | 1-12936 | | | | | 10.3 | | Maurice M. Taylor, Jr. Employment Agreement Amendment | | 10.3 to Form 10-K for the year ended December 31, 2010 | | 1-12936 | | | | | 10.4 | | Paul G. Reitz Employment Agreement | | 10.4 to Form 8-K filed on March 23, 2011 | | 1-12936 | | | | | 10.5 | | Trademark License Agreement with The Goodyear Tire & Rubber Company** | | 10.5 to Form 10-Q for the quarterly period ended September 30, 2010 | | 1-12936 | | | | | 10.6 | | Wheel Purchase Agreement with Deere & Company – November 2010** | | 10.6 to Form 10-K for the year ended December 31, 2010 | | 1-12936 | | | | | 10.7 | | Supply Agreement with Deere & Company – August 2011** | | 10.7 to Form 10-Q for the quarterly period ended September 30, 2011 | | 1-12936 |
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 10.8 | | First Amendment to Supply Agreement with Deere & Company – September 2011** | | 10.8 to Form 10-Q for the quarterly period ended September 30, 2011 | | 1-12936 | | | | | 10.9 | | Maurice M. Taylor, Jr. Employment Agreement Amendment | | 10.9 to Form 8-K filed on February 15, 2012 | | 1-12936 | | | | | 10.10 | | Second Amended and Restated Credit Agreement among the Company and Bank of America, N.A. dated as of December 21, 2012 | | 10.1 to Form 10-Q filed on July 24, 2013 | | 1-12936 | | | | | 10.11 | | Titan International, Inc. Executive Short-Term Incentive Plan | | Appendix A of the Definitive Proxy Statement filed on April 5, 2013 | | 1-12936 | | | | | 10.12 | | John Hrudicka Employment Agreement | | Exhibit 10.1 to Form 8-K filed on January 28, 2014 | | | | | | | 12.1 | | Computation of Ratio of Earnings to Fixed Charges | | * | | | | | | | 21.1 | | Subsidiaries of Titan International, Inc. | | 21 to Form 10-K filed on February 20, 2014 | | 1-12936 | | | | | 23.1 | | Consent of Grant Thornton LLP | | * | | | | | | | 23.2 | | Consent of PricewaterhouseCoopers LLP | | * | | | | | | | 23.3 | | Consent of Davis & Gilbert LLP | | (contained in Exhibit 5.1) | | | | | | | 23.4 | | Consent of Schmiedeskamp, Robertson, Neu & Mitchell LLP | | (contained in Exhibit 5.2) | | | | | | | 23.5 | | Consent of Burkey, Burkey & Scher, Co., LPA | | (contained in Exhibit 5.3) | | | | | | | 24.1 | | Powers of Attorney | | (included on signature pages) | | | | | | | 25.1 | | Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of U.S. Bank National Association, as Trustee, on Form T-1, relating to the 6.875% Senior Secured Notes due 2020 | | * | | | | | | | 99.1 | | Form of Letter of Transmittal and Consent | | * | | |
| | | | | | | Exhibit No. | | Description | | Incorporated by Reference to Exhibit No. | | File No. | | | | | 99.2 | | Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and other Nominees | | * | | | | | | | 99.3 | | Form of Letter to Clients | | * | | |
** | Confidential treatment has been requested with respect to certain portions of this exhibit. Omitted portions have been filed separately with the Securities and Exchange Commission. |
|