Showing posts with label SEC Comments. Show all posts
Showing posts with label SEC Comments. Show all posts

Thursday, May 21, 2015

Will Securities and Exchange Commission Comment On Another Titan Proxy?

In 2013 the Securities and Exchange Commission Division of Corporate Finance sent Titan Machinery Comment letters regarding the company's DEF 14 A proxy statement and also sent comment letters regarding 2 other 2013 separate company filings. (each comment letter with Titan's responses can be found below).
  • DEF 14 A Proxy
  • Resignation of Auditor
  • FY2013 10K
 One Month After Shareholders Vote on 8 Board Seats, Management decides to Add A 9th With No Vote
In June 2014 Titan Machinery shareholder meeting listed 8 directors.
On July 15,2014 Management added a 9th director seat and appointed a new director without a shareholder vote.
In May 2015 the New DEF 14 A Proxy removed the 9th board seat and returned to 8 directors.
I wonder if the 9th director was added to merely vote for the removal of PC as president/director?
Vote Required     Under applicable Delaware law, the election of each nominee requires the affirmative vote by a plurality of the voting power of the shares present and entitled to vote on the election of directors at the Annual Meeting at which a quorum is present.
Thursday May 7,2015, Titan Machinery (NASDAQ: TITN) filed a DEF 14 A Proxy .
4 Days later.......
On Monday May 11th Titan filed an 8K after the close, disclosing that the President of the Company, who is also listed as a founder, would no longer be president and will also step down from being a member of the board of directors. There has been no comment at this time from the management of Titan nor any information in the press regarding this dramatic and sudden change.

 What's the BIG DEAL? 
The big deal here is that on March 9,2015 Titan included in an 8K filing that outside director James Williams was retiring and would not stand for reelection. But Titan didn't disclose that the president wouldn't stand for reelection until four days after the DEF 14 A was filed with the SEC.

March 9,2015 8K
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

On March 5, 2015, James Williams informed the Board of Directors (the “Board”) of the Company that he will retire at the end of his current term and therefore will not stand for reelection to the Board at the Company’s 2015 Annual Meeting of Stockholders, scheduled to be held June 4, 2015. Mr. Williams' decision not to stand for reelection is the result of his retirement and is not related to any disagreement with the Company’s operations, policies or practices.
May 7,2015 DEF 14 A Proxy .
May 11,2015 8K
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On May 11, 2015, Titan Machinery Inc. (the “Company”) and Peter Christianson entered into a Services Agreement (the “Agreement”) to provide the terms of Mr. Christianson’s continued service to the Company. Under the terms of the Agreement, Mr. Christianson will conclude his term as President of the Company, and will assume the position of Chairman of International Operations, with his job duties focused on the Company’s international operations, effective as of the Company’s 2015 Annual Meeting, which will be held on June 4, 2015 (the “Annual Meeting”). Mr. Christianson will continue leading the Company’s International segment through the end of the 2016 fiscal year. Following the end of the 2016 fiscal year, Mr. Christianson will serve the Company in a consulting role.

The Agreement provides that upon his transition to a consulting role Mr. Christianson will be paid an annual fee equal to the annual base salary stated in his March 6, 2013, employment agreement for a term of three years, which amount will continue to be paid for the remainder of such term if the Agreement is terminated by the Company without Cause or by Mr. Christianson with Good Reason (each term as defined in the Agreement). Mr. Christianson will also participate in the Company’s medical and dental plans two years following his transition to consulting status. Mr. Christianson will not be entitled to other items of compensation that he is currently entitled to, including incentive compensation and other employee benefits available to Company employees. The terms of Mr. Christianson’s unvested stock option, restricted stock, and restricted stock units awards will be amended to provide that they will continue to vest on their current terms, provided that Mr. Christianson complies with the restrictive covenants contained in his employment agreement as in effect immediately prior to the execution of the Agreement.

Mr. Christianson will also conclude his service on our Board of Directors at the end of his current term, which expires on the date of the 2015 Annual Meeting.

 MAY 12,2015 Titan Machinery President to Step Down and Resign as Director (this link includes related party transactions and suspicous trading in the stock)

  Will the company need to file an updated DEF 14 A with the SEC prior to this June 2015 shareholder meeting so that all the investors will have full disclosure of this new change?

2013 Securities and Exchange Division of Corporate Finance Comment Letters
On April 24,2013 Titan Machinery filed a DEF 14 A proxy statement with the Securities and Exchange Commission. By the end of 2013 The Securities and Exchange Commission Division of Corporate Finance made the following Comments to Titan Machinery:

Auditors

Thursday, April 25, 2013


Most OverPriced Stock Titan Machinery Files Proxy Statement


 updated and edited typos at 10:52pm est.  
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Monday, April 7, 2014

A Review of Securities & Exchange Commission's Comments regarding Titan Machinery Disclosure

  • On April 10,2013, Titan Machinery Inc (NASDAQ: TITN) filed its Fiscal 2013 year end financials (10K) for the 12 month period ending January 31,2013 with the SEC. 
  • On April 25,2013, Titan Machinery Inc filed its Proxy Statement for its Annual Shareholder meeting (DEF 14A) with the SEC.
This Thursday, April 10th, before the market opens, Titan will disclose Fiscal Year 2014 financials for the 12 month period ending January 31,2014.


Securities & Exchange Commission Division of Corporate Finance Comments December 9,2013

 Equities Research:
 It will be interesting to see if the new auditor allows the company to recognize revenue in Fiscal 2014 in this same manner as Fiscal 2013: (from Fiscal 2013 10K):
 " However, in certain circumstances, and upon the customer's written request, equipment revenue is recognized before delivery occurs"


I was very critical of the financials disclosed by in both filings and analyzed both documents in my blog post : "The Most Overpriced Stock in the Market Files Proxy Statement".
                                         My reports raised many red flags :
  •  Following key words are what caught my eye, especially since these hats are worn by 4 or 5 execs:
    3 Brothers, A Son, A Brother-In-Law, COO, Chairman, Founder, Commission, Managing Director of Underwriter, Owner of Construction Company, Unsecured loans, LEASE Arrangements with Top 3 Execs outside Entities, Real Estate Sale between TITN and Top two Execs Outside Entity, Private Jet, Consulting fees, underwriting fees....(oh yeah, the time Chairman went on Mad Money and then sold shares ) 
  •  
  •  A. 10 K Highlights of Weak Fundamentals
    B. Roddy Boyd / Herb Greenberg Recognizes my Work
    C.Certain Related Party Transactions
    D.Insider Selling after Making Hyped Up Projections (missed by a mile)
    E.Increase Of Authorized Shares
    F.CNH AMERICA Floor Debt Plan
    G.Property sold to Entity owned by Top 2 Execs.without disclosure
    H.Property Ownership Company owned by Top 2 Execs outside entity.
    I.Brother-in-law Construction Company building multi-million dollars worth of buildings.
    J.OLD INVENTORY list (108 page document), not sure how if its obsolete yet.
    K.History of Negative Operational Cash Flow
    L.Private Jet
    M.$150 million convertible note disclosure. (using best scenario vs. worse scenario in disclosure)
    N.Immediate Family Members: commissions, raises, fees, consulting agreements
    O.Cash Advance Business offering loans to Bad Credit/No Credit borrowers
    P.Variable Interest on Debt
    Q.Interest Expense
    R.disclosure of former CFO, now Treasurer)
    S.Auditor's History
    T. CEO & chairman both increased salaries 48% in cash 

On Titan's last conference call in December 2013 the company lowered their year end guidance: 
For fiscal 2014 revenue range of $2.15billion to $2.35 billion and expect annual net income in the range of $11.6million to$15.8million.  Fiscal Year 2013 net income was $42 million. That is a 65% decline year over year decline. Note with shares trading at $15, the PE ratio is nearly 30.


Complaint 

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