form10q.htm

0000899751-10-000018.txt : 20100426 0000899751-10-000018.hdr.sgml : 20100426 20100423180511 ACCESSION NUMBER: 0000899751-10-000018 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20100331 FILED AS OF DATE: 20100426 DATE AS OF CHANGE: 20100423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TITAN INTERNATIONAL INC CENTRAL INDEX KEY: 0000899751 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES ROLLING MILLS (COKE OVENS) [3312] IRS NUMBER: 363228472 STATE OF INCORPORATION: IL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-12936 FILM NUMBER: 10768341 BUSINESS ADDRESS: STREET 1: 2701 SPRUCE ST CITY: QUINCY STATE: IL ZIP: 62301 BUSINESS PHONE: 2172286011 MAIL ADDRESS: STREET 1: 2701 SPRUCE ST CITY: QUINCY STATE: IL ZIP: 62301 FORMER COMPANY: FORMER CONFORMED NAME: TITAN WHEEL INTERNATIONAL INC DATE OF NAME CHANGE: 19930403 10-Q 1 form10q.htm TITAN INTERNATIONAL, INC. FORM 10-Q 3-31-10 form10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

þ	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For Quarterly Period Ended: March 31, 2010

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 1-12936

TITAN INTERNATIONAL, INC.

(Exact name of Registrant as specified in its Charter)

Illinois		36-3228472
(State of Incorporation)		(I.R.S. Employer Identification No.)

2701 Spruce Street, Quincy, IL 62301

(Address of principal executive offices, including Zip Code)

(217) 228-6011

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer þ
Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No þ

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

		Shares Outstanding at
Class		April 22, 2010

Common stock, no par value per share		35,289,584

TITAN INTERNATIONAL, INC.

TABLE OF CONTENTS

		Page
Part I.	Financial Information

Item 1.	Financial Statements (Unaudited)

	Consolidated Condensed Statements of Operations for the Three Months Ended March 31, 2010 and 2009	1

	Consolidated Condensed Balance Sheets as of March 31, 2010, and December 31, 2009	2

	Consolidated Condensed Statement of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2010	3

	Consolidated Condensed Statements of Cash Flows for the Three Months Ended March 31, 2010 and 2009	4

	Notes to Consolidated Condensed Financial Statements	5-15

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16-27

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28

Item 4.	Controls and Procedures	28

Part II.	Other Information

Item 1.	Legal Proceedings	29

Item 1A.	Risk Factors	29

Item 6.	Exhibits	29

	Signatures	29

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

TITAN INTERNATIONAL, INC.

CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)

(Amounts in thousands, except earnings per share data)

	Three months ended
	March 31,
	2010			2009
Net sales	$	196,448		$	232,604
Cost of sales		170,361			202,541
Gross profit		26,087			30,063
Selling, general and administrative expenses		11,809			12,528
Research and development expenses		2,027			999
Royalty expense		2,121			2,459
Income from operations		10,130			14,077
Interest expense		(7,056	)		(3,944	)
Other income		333			1,409
Income before income taxes		3,407			11,542
Provision for income taxes		1,329			4,501
Net income	$	2,078		$	7,041
Earnings per common share:
Basic	$	.06		$	.20
Diluted		.06			.20
Average common shares outstanding:
Basic		34,772			34,624
Diluted		35,329			35,177

See accompanying Notes to Consolidated Condensed Financial Statements.

TITAN INTERNATIONAL, INC.

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)

(Amounts in thousands, except share data)

	March 31,			December 31,
Assets	2010			2009
Current assets
Cash and cash equivalents	$	215,215		$	229,182
Accounts receivable		102,302			67,513
Inventories		129,598			110,136
Deferred income taxes		9,833			11,108
Prepaid and other current assets		24,178			27,277
Total current assets		481,126			445,216

Property, plant and equipment, net		249,304			254,461
Deferred income taxes		7,396			7,253
Other assets		27,402			29,533

Total assets	$	765,228		$	736,463

Liabilities and Stockholders’ Equity
Current liabilities
Accounts payable	$	46,678		$	24,246
Other current liabilities		50,039			45,826
Total current liabilities		96,717			70,072

Long-term debt		366,300			366,300
Other long-term liabilities		38,576			38,138
Total liabilities		501,593			474,510

Stockholders’ equity
Common stock (no par, 120,000,000 shares authorized, 37,475,288 issued)		30			30
Additional paid-in capital		299,512			299,519
Retained earnings		18,279			16,377
Treasury stock (at cost, 2,199,778 and 2,214,347 shares, respectively)		(20,144	)		(20,274	)
Treasury stock reserved for contractual obligations		(5,393	)		(5,393	)
Accumulated other comprehensive loss		(28,649	)		(28,306	)
Total stockholders’ equity		263,635			261,953

Total liabilities and stockholders’ equity	$	765,228		$	736,463

See accompanying Notes to Consolidated Condensed Financial Statements.

TITAN INTERNATIONAL, INC.

CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

(Amounts in thousands, except share data)

	Number of common shares		Common Stock		Additional paid-in capital			Retained earnings			Treasury stock			Treasury stock reserved for contractual obligations			Accumulated other comprehensive income (loss)			Total

Balance January 1, 2010	#	35,260,941	$	30	$	299,519		$	16,377		$	(20,274	)	$	(5,393	)	$	(28,306	)	$	261,953

Comprehensive income:
Net income									2,078												2,078
Pension liability adjustments, net of tax																		575			575
Unrealized loss on investment, net of tax																		(918	)		(918	)
Comprehensive income																					1,735
Dividends on common stock									(176	)											(176	)
Issuance of treasury stock under 401(k) plan		14,569				(7	)					130									123

Balance March 31, 2010	#	35,275,510	$	30	$	299,512		$	18,279		$	(20,144	)	$	(5,393	)	$	(28,649	)	$	263,635

See accompanying Notes to Consolidated Condensed Financial Statements.

TITAN INTERNATIONAL, INC.

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

(Amounts in thousands)

	Three months ended
	March 31,
	2010			2009
Cash flows from operating activities:
Net income	$	2,078		$	7,041
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		9,281			7,966
Deferred income tax provision		1,275			0
Gain on senior note repurchase		0			(1,398	)
Excess tax benefit from stock options exercised		0			(67	)
Issuance of treasury stock under 401(k) plan		123			136
(Increase) decrease in assets:
Accounts receivable		(34,789	)		729
Inventories		(19,462	)		(20,325	)
Prepaid and other current assets		3,099			1,802
Other assets		46			25
Increase (decrease) in liabilities:
Accounts payable		22,432			(11,586	)
Other current liabilities		4,413			(243	)
Other liabilities		1,365			1,916
Net cash used for operating activities		(10,139	)		(14,004	)

Cash flows from investing activities:
Capital expenditures		(3,508	)		(19,933	)
Acquisition of shares of Titan Europe Plc		0			(2,399	)
Other		42			12
Net cash used for investing activities		(3,466	)		(22,320	)

Cash flows from financing activities:
Repurchase of senior notes		0			(4,726	)
Proceeds from exercise of stock options		0			800
Excess tax benefit from stock options exercised		0			67
Payment of financing fees		(186	)		(1,070	)
Dividends paid		(176	)		(175	)
Net cash used for financing activities		(362	)		(5,104	)

Net decrease in cash and cash equivalents		(13,967	)		(41,428	)

Cash and cash equivalents at beginning of period		229,182			61,658

Cash and cash equivalents at end of period	$	215,215		$	20,230

See accompanying Notes to Consolidated Condensed Financial Statements.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

1. ACCOUNTING POLICIES

In the opinion of Titan International, Inc. (Titan or the Company), the accompanying unaudited consolidated condensed financial statements contain all adjustments, which are normal and recurring in nature and necessary to present fairly the Company’s financial position as of March 31, 2010, and the results of operations and cash flows for the three months ended March 31, 2010 and 2009.

Accounting policies have continued without significant change and are described in the Description of Business and Significant Accounting Policies contained in the Company’s 2009 Annual Report on Form 10-K. These interim financial statements have been prepared pursuant to the Securities and Exchange Commission’s rules for Form 10-Q’s and, therefore, certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2009 Annual Report on Form 10-K. Certain amount s from prior periods have been reclassified to conform to the current period financial presentation.

Fair value of financial instruments

The Company records all financial instruments, including cash and cash equivalents, accounts receivable, notes receivable, accounts payable, other accruals and notes payable at cost, which approximates fair value. Investments in marketable equity securities are recorded at fair value. The senior unsecured 8% notes due 2012 (senior notes) and convertible senior subordinated 5.625% notes due 2017 (convertible notes) are carried at cost of $193.8 million and $172.5 million at March 31, 2010, respectively. The fair value of these notes at March 31, 2010, as obtained through independent pricing sources, was approximately $193.8 million for the senior notes and approximately $182.9 million for the convertible notes.

Cash dividends

The Company declared cash dividends of $.005 per share of common stock for each of the three months ended March 31, 2010 and 2009.

2. ACCOUNTS RECEIVABLE

Accounts receivable consisted of the following (in thousands):

	March 31,			December 31,
	2010			2009
Accounts receivable	$	106,676		$	71,471
Allowance for doubtful accounts		(4,374	)		(3,958	)
Accounts receivable, net	$	102,302		$	67,513

The Company had net accounts receivable balance of $102.3 million at March 31, 2010, and $67.5 million at December 31, 2009. These amounts are net of allowance for doubtful accounts of $4.4 million at March 31, 2010, and $4.0 million at December 31, 2009.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

3. INVENTORIES

Inventories consisted of the following (in thousands):

	March 31,		December 31,
	2010		2009
Raw materials	$	44,376	$	44,336
Work-in-process		24,563		21,378
Finished goods		60,638		46,067
		129,577		111,781
Adjustment to LIFO basis		21		(1,645	)
	$	129,598	$	110,136

Inventories were $129.6 million at March 31, 2010, and $110.1 million at December 31, 2009. At March 31, 2010, cost is determined using the first-in, first-out (FIFO) method for approximately 74% of inventories and the last-in, first-out (LIFO) method for approximately 26% of the inventories. At December 31, 2009, the FIFO method was used for approximately 74% of inventories and LIFO was used for approximately 26% of the inventories. Included in the inventory balances were reserves for slow-moving and obsolete inventory of $2.5 million at March 31, 2010, and $2.3 million at December 31, 2009.

4. PROPERTY, PLANT AND EQUIPMENT, NET

Property, plant and equipment, net consisted of the following (in thousands):

	March 31,			December 31,
	2010			2009
Land and improvements	$	2,993		$	2,993
Buildings and improvements		97,263			97,238
Machinery and equipment		358,937			359,244
Tools, dies and molds		78,267			77,926
Construction-in-process		18,514			16,383
		555,974			553,784
Less accumulated depreciation		(306,670	)		(299,323	)
	$	249,304		$	254,461

The Company had property, plant and equipment of $249.3 million and $254.5 million at March 31, 2010 and December 31, 2009, respectively. Depreciation on fixed assets for the three months ended March 31, 2010 and 2009, totaled $8.6 million and $7.3 million, respectively.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

5. INVESTMENT IN TITAN EUROPE PLC

Investment in Titan Europe Plc consisted of the following (in thousands):

	March 31,		December 31,
	2010		2009
Investment in Titan Europe Plc	$	5,043	$	6,456

Titan Europe Plc is publicly traded on the AIM market in London, England. The Company’s investment in Titan Europe represents a 22.9% ownership percentage. The Company has considered the applicable guidance in ASC 323 Investments – Equity Method and Joint Ventures and has concluded that the Company’s investment in Titan Europe Plc should be accounted for as an available-for-sale security and recorded at fair value in accordance with ASC 320 Investments – Debt and Equity Securities as the Company does not have significant influence over Titan Europe Plc. The investment in Titan Europe Plc is included as a component of other assets on the Consolidated Condensed Balance Sheets. Titan’s cost basis in Titan Europe is $5.0 million. The decreased value in the Ti tan Europe Plc investment at March 31, 2010, was due to a lower publicly quoted Titan Europe Plc market price and a lower exchange rate.

6. WARRANTY

Changes in the warranty liability consisted of the following (in thousands):

	2010			2009
Warranty liability, January 1	$	9,169		$	7,488
Provision for warranty liabilities		3,629			3,025
Warranty payments made		(3,377	)		(2,971	)
Warranty liability, March 31	$	9,421		$	7,542

The Company provides limited warranties on workmanship on its products in all market segments. The majority of the Company’s products have a limited warranty that ranges from zero to ten years with certain products being prorated after the first year. The Company calculates a provision for warranty expense based on past warranty experience. Warranty accruals are included as a component of other current liabilities on the Consolidated Condensed Balance Sheets.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

7. REVOLVING CREDIT FACILITY AND LONG-TERM DEBT

Long-term debt consisted of the following (in thousands):

	March 31,		December 31,
	2010		2009
Senior unsecured 8% notes due 2012	$	193,800	$	193,800
Convertible senior subordinated 5.625% notes due 2017		172,500		172,500
Revolving credit facility		0		0
		366,300		366,300
Less: Amounts due within one year		0		0
	$	366,300	$	366,300

Aggregate maturities of long-term debt at March 31, 2010, were as follows (in thousands):

April 1 – December 31, 2010	$	0
2011		0
2012		193,800
2013		0
2014		0
Thereafter		172,500
	$	366,300

Senior unsecured 8% notes due 2012

The Company’s senior unsecured 8% notes (senior notes) are due January 2012. In the first quarter of 2009, the Company repurchased $6.2 million of principal value of senior notes for approximately $4.8 million resulting in a $1.4 million gain on the senior note repurchases. The Company’s senior notes outstanding balance was $193.8 million at March 31, 2010.

Convertible senior subordinated 5.625% notes due 2017

The Company’s convertible senior subordinated 5.625% notes (convertible notes) are due January 2017. The initial base conversion rate for the convertible notes is 93.0016 shares of Titan common stock per $1,000 principal amount of convertible notes, equivalent to an initial base conversion price of approximately $10.75 per share of Titan common stock. If the price of Titan 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 Titan common stock per $1,000 principal amount of convertible notes) as determined pursuant to a formula described in the indenture. The base conversion rate will be subject to adjustment in certain events. The Company’s convertible n otes balance was $172.5 million at March 31, 2010.

Revolving credit facility

The Company’s $150 million revolving credit facility (credit facility) with agent Bank of America, N.A. has a January 2012 termination date and is collateralized by a first priority security interest in certain assets of Titan and its domestic subsidiaries. During the first quarter of 2010 and at March 31, 2010, there were no borrowings under the credit facility.

The credit facility has an accordion feature that sets the initial loan availability at $150 million with the ability to request increases up to a maximum availability of $250 million. The credit facility contains certain financial covenants, restrictions and other customary affirmative and negative covenants. Titan is in compliance with these covenants and restrictions as of March 31, 2010.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

8. LEASE COMMITMENTS

The Company leases certain buildings and equipment under operating leases. Certain lease agreements provide for renewal options, fair value purchase options, and payment of property taxes, maintenance and insurance by the Company.

At March 31, 2010, future minimum commitments under noncancellable operating leases with initial or remaining terms of at least one year were as follows (in thousands):

April 1 – December 31, 2010	$	1,135
2011		735
2012		64
2013		14
Thereafter		1
Total future minimum lease payments	$	1,949

9. EMPLOYEE BENEFIT PLANS

The Company has three frozen defined benefit pension plans and one defined benefit plan that previously purchased a final annuity settlement. The Company also sponsors four 401(k) retirement savings plans. The Company expects to contribute approximately $2 million to the pension plans during the remainder of 2010.

The components of net periodic pension cost consisted of the following (in thousands):

	Three months ended March 31,
	2010			2009
Interest cost	$	1,300		$	1,364
Expected return on assets		(1,227	)		(1,234	)
Amortization of unrecognized prior service cost		34			34
Amortization of unrecognized deferred taxes		(14	)		(14	)
Amortization of net unrecognized loss		907			1,076
Net periodic pension cost	$	1,000		$	1,226

10. ROYALTY EXPENSE

Royalty expense consisted of the following (in thousands):

	Three months ended March 31,
	2010		2009
Royalty expense	$	2,121	$	2,459

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

11. OTHER INCOME

Other income consisted of the following (in thousands):

	Three months ended March 31,
	2010		2009
Gain on senior note repurchases	$	0	$	1,398
Investment gain (loss) on contractual obligations		196		(103	)
Interest income		94		64
Other income		43		50
	$	333	$	1,409

The gain on senior note repurchases of $1.4 million resulted from the Company’s repurchase of $6.2 million of principal value of senior notes for approximately $4.8 million in the first quarter of 2009.

12. INCOME TAXES

Income tax expense consisted of the following (in thousands):

	Three months ended March 31,
	2010		2009
Income tax expense	$	1,329	$	4,501

The Company recorded income tax expense of $1.3 million and $4.5 million for the quarters ended March 31, 2010 and 2009, respectively. The Company’s effective income tax rate was 39% for both of the three months ended March 31, 2010 and 2009.

13. COMPREHENSIVE INCOME

The Company’s comprehensive income consisted of the following: (i) for the quarter ended March 31, 2010, net income of $2.1 million, amortization of pension adjustments of $0.5 million and unrealized loss on the Titan Europe Plc investment of $(0.9) million for a total comprehensive income of $1.7 million; (ii) for the quarter ended March 31, 2009, net income of $7.0 million, amortization of pension adjustments of $0.7 million and unrealized loss on the Titan Europe Plc investment of $(1.7) million for a total comprehensive income of $6.0 million.

14. EARNINGS PER SHARE

Earnings per share (EPS) were as follows (amounts in thousands, except per share data):

	Three months ended
	March 31, 2010						March 31, 2009
	Net Income		Weighted average shares		Per share amount		Net Income		Weighted average shares		Per share amount
Basic EPS	$	2,078		34,772	$	.06	$	7,041		34,624	$	.20
Effect of stock options/trusts		0		557				0		553
Diluted EPS	$	2,078		35,329	$	.06	$	7,041		35,177	$	.20

The effect of convertible notes has been excluded for the three months ended March 31, 2010, as the effect would have been antidilutive. The weighted average share amount excluded for convertible notes totaled 16.0 million shares.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

15. SEGMENT INFORMATION

The table below presents information about certain revenues and income from operations used by the chief operating decision maker of the Company for the three months ended March 31, 2010 and 2009 (in thousands):

	Three months ended March 31,
	2010			2009
Revenues from external customers
Agricultural	$	151,112		$	187,328
Earthmoving/construction		41,815			39,927
Consumer		3,521			5,349
	$	196,448		$	232,604

Gross profit
Agricultural	$	23,890		$	24,920
Earthmoving/construction		3,150			4,884
Consumer		668			788
Unallocated corporate		(1,621	)		(529	)
	$	26,087		$	30,063

Income from operations
Agricultural	$	19,955		$	20,085
Earthmoving/construction		690			3,840
Consumer		581			637
Unallocated corporate		(11,096	)		(10,485	)
Consolidated income from operations		10,130			14,077
Interest expense		(7,056	)		(3,944	)
Other income, net		333			1,409
Income before income taxes	$	3,407		$	11,542

Assets by segment were as follows (in thousands):

	March 31,		December 31,
Total Assets	2010		2009
Agricultural	$	314,692	$	257,523
Earthmoving/construction		195,753		188,169
Consumer		8,669		8,305
Unallocated corporate		246,114		282,466
Consolidated totals	$	765,228	$	736,463

16. LITIGATION

The Company is a party to routine legal proceedings arising out of the normal course of business. Although it is not possible to predict with certainty the outcome of these unresolved legal actions or the range of possible loss, the Company believes at this time that none of these actions, individually or in the aggregate, will have a material adverse effect on the consolidated financial condition, results of operations or cash flows of the Company. However, due to the difficult nature of predicting unresolved and future legal claims, the Company cannot anticipate or predict the material adverse effect on its consolidated financial condition, results of operations or cash flows as a result of efforts to comply with or its liabilities pertaining to legal judgments.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

17. FAIR VALUE MEASUREMENTS

ASC 820 Fair Value Measurements establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers are defined as:

Level 1 – Quoted prices in active markets for identical instruments;

Level 2 – Inputs other than quoted prices in active markets that are either directly or indirectly observable.

Level 3 – Unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

Assets and liabilities measured at fair value on a recurring basis consisted of the following (in thousands):

	March 31, 2010						December 31, 2009
	Total		Level 1		Levels 2&3		Total		Level 1		Levels 2&3
Investments for contractual obligations	$	6,064	$	6,064	$	0	$	5,869	$	5,869	$	0
Investment in Titan Europe Plc		5,043		5,043		0		6,456		6,456		0
Total	$	11,107	$	11,107	$	0	$	12,325	$	12,325	$	0

18. RECENTLY ISSUED ACCOUNTING STANDARDS

Fair Value Measurements and Disclosures

In January 2010, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2010-06, “Fair Value Measurements and Disclosures (Topic 820) – Improving Disclosures about Fair Value Measurements.” This guidance requires new disclosures for transfers in and out of Level 1 and Level 2 fair value measurements. This guidance requires separate presentation about purchases, sales, issuances, and settlements for activity in Level 3 fair value measurements. ASU 2010-06 also clarifies existing fair value disclosures about the level of disaggregation and about inputs and valuation techniques used to measure fair value. The guidance for new disclosures and clarifications of existing disclosures was effective for interim and annual reporting period s beginning after December 15, 2009. The adoption of this part of the guidance had no material effect on the Company’s financial position, results of operations or cash flows. The guidance related to presentation of Level 3 fair value measurements is effective for fiscal years beginning after December 15, 2010. The adoption of this part of the guidance is not expected to have a material effect on the Company’s financial position, results of operations or cash flows.

Subsequent Events

In February 2010, the FASB issued ASU 2010-9, “Subsequent Events (Topic 855) – Amendments to Certain Recognition and Disclosure Requirements.” This guidance removes the requirement for an entity that files financial statements with the Securities and Exchange Commission to disclose a date through which subsequent events have been evaluated. This guidance was effective immediately. The adoption of this guidance had no material effect on the Company’s financial position, results of operations or cash flows.

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

19. SUBSIDIARY GUARANTOR FINANCIAL INFORMATION

The Company’s 8% senior unsecured notes and 5.625% convertible senior subordinated notes 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 $250,000 and total revenues less than $250,000.) The note guarantees are full and unconditional, joint and several obligations of the guarantors. Non-guarantors consist primarily of foreign subsidiaries of the Company, which are organized outside the United States of America. The following condensed consolidating financial statements are presented using the equity method of accounting.

	Consolidating Condensed Statements of Operations
(Amounts in thousands)
	For the Three Months Ended March 31, 2010
	Titan					Non-
	Intl., Inc.			Guarantor		Guarantor
	(Parent)			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net sales	$	0		$	196,448	$	0		$	0		$	196,448
Cost of sales		1,324			169,037		0			0			170,361
Gross profit (loss)		(1,324	)		27,411		0			0			26,087
Selling, general and administrative expenses		4,864			6,906		39			0			11,809
Research and development expenses		0			2,027		0			0			2,027
Royalty expense		0			2,121		0			0			2,121
Income (loss) from operations		(6,188	)		16,357		(39	)		0			10,130
Interest expense		(7,056	)		0		0			0			(7,056	)
Other income (expense)		290			44		(1	)		0			333
Income (loss) before income taxes		(12,954	)		16,401		(40	)		0			3,407
Provision (benefit) for income taxes		(5,052	)		6,396		(15	)		0			1,329
Equity in earnings of subsidiaries		9,980			0		0			(9,980	)		0
Net income (loss)	$	2,078		$	10,005	$	(25	)	$	(9,980	)	$	2,078

	Consolidating Condensed Statements of Operations
(Amounts in thousands)
	For the Three Months Ended March 31, 2009
	Titan					Non-
	Intl., Inc.			Guarantor		Guarantor
	(Parent)			Subsidiaries		Subsidiaries			Eliminations			Consolidated
Net sales	$	0		$	232,604	$	0		$	0		$	232,604
Cost of sales		221			202,320		0			0			202,541
Gross profit (loss)		(221	)		30,284		0			0			30,063
Selling, general and administrative expenses		4,688			7,838		2			0			12,528
Research and development expenses		3			996		0			0			999
Royalty expense		0			2,459		0			0			2,459
Income (loss) from operations		(4,912	)		18,991		(2	)		0			14,077
Interest expense		(3,944	)		0		0			0			(3,944	)
Other income		1,296			113		0			0			1,409
Income (loss) before income taxes		(7,560	)		19,104		(2	)		0			11,542
Provision (benefit) for income taxes		(2,948	)		7,450		(1	)		0			4,501
Equity in earnings of subsidiaries		11,653			0		0			(11,653	)		0
Net income (loss)	$	7,041		$	11,654	$	(1	)	$	(11,653	)	$	7,041

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

	Consolidating Condensed Balance Sheets
(Amounts in thousands)
	March 31, 2010
	Titan						Non-
	Intl., Inc.			Guarantor			Guarantor
	(Parent)			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Assets
Cash and cash equivalents	$	215,046		$	25		$	144		$	0		$	215,215
Accounts receivable		0			102,302			0			0			102,302
Inventories		0			129,598			0			0			129,598
Prepaid and other current assets		15,876			18,135			0			0			34,011
Total current assets		230,922			250,060			144			0			481,126
Property, plant and equipment, net		2,487			246,817			0			0			249,304
Investment in subsidiaries		17,745			0			0			(17,745	)		0
Other assets		23,577			6,178			5,043			0			34,798
Total assets	$	274,731		$	503,055		$	5,187		$	(17,745	)	$	765,228

Liabilities and Stockholders’ Equity
Accounts payable	$	1,491		$	45,187		$	0		$	0		$	46,678
Other current liabilities		2,708			47,331			0			0			50,039
Total current liabilities		4,199			92,518			0			0			96,717
Long-term debt		366,300			0			0			0			366,300
Other long-term liabilities		5,978			32,598			0			0			38,576
Intercompany accounts		(365,381	)		391,737			(26,356	)		0			0
Stockholders’ equity		263,635			(13,798	)		31,543			(17,745	)		263,635
Total liabilities and stockholders’ equity	$	274,731		$	503,055		$	5,187		$	(17,745	)	$	765,228

	Consolidating Condensed Balance Sheets
(Amounts in thousands)
	December 31, 2009
	Titan						Non-
	Intl., Inc.			Guarantor			Guarantor
	(Parent)			Subsidiaries			Subsidiaries			Eliminations			Consolidated
Assets
Cash and cash equivalents	$	229,004		$	11		$	167		$	0		$	229,182
Accounts receivable		(201	)		67,714			0			0			67,513
Inventories		0			110,136			0			0			110,136
Prepaid and other current assets		19,857			18,528			0			0			38,385
Total current assets		248,660			196,389			167			0			445,216
Property, plant and equipment, net		7,602			246,859			0			0			254,461
Investment in subsidiaries		10,748			0			0			(10,748	)		0
Other assets		23,870			6,460			6,456			0			36,786
Total assets	$	290,880		$	449,708		$	6,623		$	(10,748	)	$	736,463

Liabilities and Stockholders’ Equity
Accounts payable	$	1,086		$	23,160		$	0		$	0		$	24,246
Other current liabilities		8,288			37,538			0			0			45,826
Total current liabilities		9,374			60,698			0			0			70,072
Long-term debt		366,300			0			0			0			366,300
Other long-term liabilities		5,574			32,564			0			0			38,138
Intercompany accounts		(352,321	)		377,281			(24,960	)		0			0
Stockholders’ equity		261,953			(20,835	)		31,583			(10,748	)		261,953
Total liabilities and stockholders’ equity	$	290,880		$	449,708		$	6,623		$	(10,748	)	$	736,463

TITAN INTERNATIONAL, INC.

Notes to Consolidated Condensed Financial Statements

(Unaudited)

	Consolidating Condensed Statements of Cash Flows
(Amounts in thousands)
	For the Three Months Ended March 31, 2010
	Titan						Non-
	Intl., Inc.			Guarantor			Guarantor
	(Parent)			Subsidiaries			Subsidiaries			Consolidated
Net cash provided by (used for) operating activities	$	(13,596	)	$	3,480		$	(23	)	$	(10,139	)

Cash flows from investing activities:
Capital expenditures		0			(3,508	)		0			(3,508	)
Other, net		0			42			0			42
Net cash used for investing activities		0			(3,466	)		0			(3,466	)

Cash flows from financing activities:
Payment of financing fees		(186	)		0			0			(186	)
Other, net		(176	)		0			0			(176	)
Net cash used for financing activities		(362	)		0			0			(362	)

Net increase (decrease) in cash and cash equivalents		(13,958	)		14			(23	)		(13,967	)
Cash and cash equivalents, beginning of period		229,004			11			167			229,182
Cash and cash equivalents, end of period	$	215,046		$	25		$	144		$	215,215

	Consolidating Condensed Statements of Cash Flows
(Amounts in thousands)
	For the Three Months Ended March 31, 2009
	Titan						Non-
	Intl., Inc.			Guarantor			Guarantor
	(Parent)			Subsidiaries			Subsidiaries			Consolidated
Net cash provided by (used for) operating activities	$	(32,630	)	$	18,613		$	13		$	(14,004	)

Cash flows from investing activities:
Capital expenditures		(1,266	)		(18,667	)		0			(19,933	)
Acquisition of shares of Titan Europe Plc		0			0			(2,399	)		(2,399	)
Other, net		0			12			0			12
Net cash used for investing activities		(1,266	)		(18,655	)		(2,399	)		(22,320	)

Cash flows from financing activities:
Payment on senior note		(4,726	)		0			0			(4,726	)
Proceeds from exercise of stock options		800			0			0			800
Payment of financing fees		(1,070	)		0			0			(1,070	)
Other, net		(108	)		0			0			(108	)
Net cash used for financing activities		(5,104	)		0			0			(5,104	)

Net decrease in cash and cash equivalents		(39,000	)		(42	)		(2,386	)		(41,428	)
Cash and cash equivalents, beginning of period		59,011			60			2,587			61,658
Cash and cash equivalents, end of period	$	20,011		$	18		$	201		$	20,230

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS

Management’s discussion and analysis of financial condition and results of operations (MD&A) is designed to provide a reader of these financial statements with a narrative from the perspective of the management of Titan International, Inc. (Titan or the Company) on Titan’s financial condition, results of operations, liquidity and other factors which may affect the Company’s future results. The MD&A in this quarterly report should be read in conjunction with the MD&A in Titan’s 2009 annual report on Form 10-K filed with the Securities and Exchange Commission on February 25, 2010.

FORWARD-LOOKING STATEMENTS

This Form 10-Q contains forward-looking statements, including statements regarding, among other items:

·	Anticipated trends in the Company’s business

·	Future expenditures for capital projects

·	The Company’s ability to continue to control costs and maintain quality

·	Ability to meet financial covenants and conditions of loan agreements

·	The Company’s business strategies, including its intention to introduce new products

·	Expectations concerning the performance and success of the Company’s existing and new products

·	The Company’s intention to consider and pursue acquisition and divestiture opportunities

Readers of this Form 10-Q should understand that these forward-looking statements are based on the Company’s expectations and are subject to a number of risks and uncertainties, certain of which are beyond the Company’s control.

Actual results could differ materially from these forward-looking statements as a result of certain factors, including:

·	The effect of the economic crisis and recession on the Company and its customers and suppliers

·	Changes in the Company’s end-user markets as a result of world economic or regulatory influences

·	Changes in the marketplace, including new products and pricing changes by the Company’s competitors

·	Ability to maintain satisfactory labor relations

·	Unfavorable outcomes of legal proceedings

·	Availability and price of raw materials

·	Levels of operating efficiencies

·	Unfavorable product liability and warranty claims

·	Actions of domestic and foreign governments

·	Results of investments

·	Fluctuations in currency translations

·	Ability to secure financing at reasonable terms

·	Laws and regulations related to climate change

·	Risks associated with environmental laws and regulations

Any changes in such factors could lead to significantly different results. The Company cannot provide any assurance that the assumptions referred to in the forward-looking statements or otherwise are accurate or will prove to transpire. Any assumptions that are inaccurate or do not prove to be correct could have a material adverse effect on the Company’s ability to achieve the results as indicated in forward-looking statements. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks and uncertainties, there can be no assurance that the forward-looking information contained in this document will in fact transpire.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

OVERVIEW

Titan International, Inc. and its subsidiaries are leading manufacturers of wheels, tires and assemblies for off-highway vehicles used in the agricultural, earthmoving/construction and consumer markets. Titan manufactures both wheels and tires for the majority of these market applications, allowing the Company to provide the value-added service of delivering complete wheel and tire assemblies. The Company offers a broad range of products that are manufactured in relatively short production runs to meet the specifications of original equipment manufacturers (OEMs) and/or the requirements of aftermarket customers.

Agricultural Market: Titan’s agricultural rims, wheels and tires are manufactured for use on various agricultural and forestry equipment, including tractors, combines, skidders, plows, planters and irrigation equipment, and are sold directly to OEMs and to the aftermarket through independent distributors, equipment dealers and Titan’s own distribution centers.

Earthmoving/Construction Market: The Company manufactures rims, wheels and tires for various types of off-the-road (OTR) earthmoving, mining, military and construction equipment, including skid steers, aerial lifts, cranes, graders and levelers, scrapers, self-propelled shovel loaders, articulated dump trucks, load transporters, haul trucks and backhoe loaders. The earthmoving/construction market is often referred to as OTR, an acronym for off-the-road.

Consumer Market: Titan builds select products for all-terrain vehicles (ATV), turf, golf and trailer applications. The Company provides wheels/tires and assembles brakes, actuators and components for the domestic boat, recreational and utility trailer markets.

The Company’s major OEM customers include large manufacturers of off-highway equipment such as AGCO Corporation, Caterpillar Inc., CNH Global N.V., Deere & Company and Kubota Corporation, in addition to many other off-highway equipment manufacturers. The Company distributes products to OEMs, independent and OEM-affiliated dealers, and through a network of distribution facilities.

The following table provides highlights for the quarter ended March, 2010, compared to 2009 (amounts in thousands):

	Three months ended March 31,
	2010		2009		% Decrease
Net sales	$	196,448	$	232,604		(16	)%
Gross profit		26,087		30,063		(13	)%
Income from operations		10,130		14,077		(28	)%
Net income		2,078		7,041		(70	)%

The Company recorded sales of $196.4 million for the first quarter of 2010, which were 16% lower than the first quarter 2009 sales of $232.6 million. The lower sales were primarily the result of reduced demand in the Company’s agricultural market which was down by approximately 19% when compared to last year’s first quarter.

The following operating results were primarily related to the reduced sales levels and the associated negative impact on the Company’s operating profit. The Company’s gross profit was $26.1 million for the first quarter of 2010, compared to $30.1 million in 2009. Net income was $2.1 million for the quarter, compared to $7.0 million in 2009. Basic earnings per share were $.06 in the first quarter of 2010, compared to $.20 in 2009.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

CRITICAL ACCOUNTING ESTIMATES

Preparation of the financial statements and related disclosures in compliance with accounting principles generally accepted in the United States of America requires the application of appropriate technical accounting rules and guidance, as well as the use of estimates. The Company’s application of these policies involves assumptions that require difficult subjective judgments regarding many factors, which, in and of themselves, could materially impact the financial statements and disclosures. A future change in the estimates, assumptions or judgments applied in determining the following matters, among others, could have a material impact on future financial statements and disclosures.

Inventories

Inventories are valued at lower of cost or market. Cost is determined using the first-in, first-out (FIFO) method for approximately 74% of inventories and the last-in, first-out (LIFO) method for approximately 26% of inventories. The major rubber material inventory and related work-in-process and their finished goods are accounted for under the FIFO method. The major steel material inventory and related work-in-process and their finished goods are accounted for under the LIFO method. Market value is estimated based on current selling prices. Estimated provisions are established for slow-moving and obsolete inventory, as well as inventory carried above market price based on historical experience. Should there be an adverse change in experience, increases to estimated provisi ons would be necessary.

Income Taxes

Deferred income tax provisions are determined using the liability method whereby deferred tax assets and liabilities are recognized based upon temporary differences between the financial statement and income tax basis of assets and liabilities. The Company assesses the realizability of its deferred tax asset positions and recognizes and measures uncertain tax positions in accordance with ASC 740 Income Taxes.

As a result of the 2009 net loss, the Company has a net operating loss carryforward for income tax purposes. If Titan would continue to incur net losses, the Company may not be able to realize the tax benefit of these net operating losses.

Asset and Business Acquisitions

The allocation of purchase price for asset and business acquisitions requires management estimates and judgment as to expectations for future cash flows of the acquired assets and business and the allocation of those cash flows to identifiable intangible assets in determining the estimated fair value for purchase price allocations. If the actual results differ from the estimates and judgments used in determining the purchase price allocations, impairment losses could occur relating to any intangibles recorded in the acquisition. To aid in establishing the value of any intangible assets at the time of acquisition, the Company typically engages a professional appraisal firm.

Retirement Benefit Obligations

Pension benefit obligations are based on various assumptions used by third-party actuaries in calculating these amounts. These assumptions include discount rates, expected return on plan assets, mortality rates and other factors. Revisions in assumptions and actual results that differ from the assumptions affect future expenses, cash funding requirements and obligations. The Company has three frozen defined benefit pension plans and one defined benefit plan that previously purchased a final annuity settlement. During the first three months of 2010, the Company contributed cash funds of $0.1 million to its frozen pension plans. Titan expects to contribute approximately $2 million to these frozen defined pension plans during the remainder of 2010. For more information concerning these c osts and obligations, see the discussion of the “Pensions” and Note 20 to the Company’s financial statements on Form 10-K for the fiscal year ended December 31, 2009.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

RESULTS OF OPERATIONS

Highlights for the three months ended March 31, 2010, compared to 2009 (amounts in thousands):

	Three months ended March 31,
	2010			2009
Net sales	$	196,448		$	232,604
Cost of sales		170,361			202,541
Gross profit	$	26,087		$	30,063
Gross profit margin		13.3	%		12.9	%

Net Sales

Net sales for the quarter ended March 31, 2010, were $196.4 million, compared to $232.6 million in 2009. The sales decreased by approximately 16%, primarily the result of reduced demand in the Company’s agricultural market, which was down by approximately 19% when compared to last year’s first quarter. The Company believes the agricultural industry, along with the earthmoving/construction and consumer markets, are continuing to be affected by the on-going uncertainty in domestic and global economic conditions.

Cost of Sales and Gross Profit

Cost of sales was $170.4 million for the first quarter of 2010, compared to $202.5 million in 2009. The lower cost of sales resulted primarily from the reduction in the quarterly sales levels. The cost of sales decreased by approximately 16%, the same percentage as the net sales.

Gross profit for the first quarter of 2010 was $26.1 million, or 13.3% of net sales, compared to $30.1 million, or 12.9% of net sales, for the first quarter of 2009. The gross profit margin showed a slight improvement despite the reduction in sales, primarily due to improved manufacturing efficiencies, including reduced headcount, in the Company’s agricultural segment.

Selling, General and Administrative Expenses

Selling, general and administrative expenses were as follows (amounts in thousands):

	Three months ended March 31,
	2010			2009
Selling, general and administrative	$	11,809		$	12,528
Percentage of net sales		6.0	%		5.4	%

Selling, general and administrative (SG&A) expenses for the first quarter of 2010 were $11.8 million, or 6.0% of net sales, compared to $12.5 million, or 5.4% of net sales, for 2009. When the SG&A expenses are expressed as a percentage of net sales, the percentage is higher due to the lower sales levels. Selling expenses decreased approximately $0.5 million, primarily as the result of the lower sales levels.

Research and Development Expenses

Research and development expenses were as follows (amounts in thousands):

	Three months ended March 31,
	2010			2009
Research and development	$	2,027		$	999
Percentage of net sales		1.0	%		0.4	%

Research and development (R&D) expenses were $2.0 million, or 1.0% of net sales, for the first quarter of 2010 as compared to $1.0 million, or 0.4% of net sales, for the first quarter of 2009. The additional R&D costs recorded during the first quarter of approximately $1 million primarily related to the giant off-the-road (OTR) products.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

Royalty Expense

Royalty expense was as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Royalty expense	$	2,121	$	2,459

The Company has a trademark license agreement with The Goodyear Tire & Rubber Company to manufacture and sell certain off-highway tires in North America under the Goodyear name. Royalty expenses were $2.1 million and $2.5 million for the first quarter of 2010 and 2009, respectively. As sales subject to the trademark license agreement were lower, the Company’s royalty expense for the first quarter of 2010 was reduced accordingly.

Income from Operations

Income from operations was as follows (amounts in thousands):

	Three months ended March 31,
	2010			2009
Income from operations	$	10,130		$	14,077
Percentage of net sales		5.2	%		6.1	%

Income from operations for the first quarter of 2010 was $10.1 million, or 5.2% of net sales, compared to $14.1 million, or 6.1% of net sales, in 2009. This reduction was the net result of the items discussed in the (i) sales, (ii) cost of sales, (iii) selling general and administrative, (iv) research and development and (v) royalty line items.

Interest Expense

Interest expense was as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Interest expense	$	7,056	$	3,944

Interest expense was $7.1 million for the first quarter of 2010, compared to $3.9 million in 2009. The Company’s interest expense for the first quarter of 2010 increased from the previous year primarily as a result of interest expense related to the convertible senior subordinated 5.625% notes that were issued in December of 2009.

Other Income

Other income was as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Other income	$	333	$	1,409

Other income for the first quarter of 2010 was $0.3 million, compared to $1.4 million in 2009. A gain on senior note repurchases of $1.4 million was included in other income for the first quarter of 2009.

Income Taxes

Income taxes were as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Income tax expense	$	1,329	$	4,501

The Company recorded income tax expense of $1.3 million and $4.5 million for the quarters ended March 31, 2010 and 2009, respectively. The Company’s effective income tax rate was 39% for each of the three months ended March 31, 2010 and 2009.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

Net Income

Net income was as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Net income	$	2,078	$	7,041

Net income for the first quarter of 2010 was $2.1 million, compared to $7.0 million in 2009. Basic earnings and diluted earnings per share were each $.06 for the first quarter of 2010, compared to $.20 in the first quarter of 2009. The Company’s net income and earnings per share were lower due to the items previously discussed.

Agricultural Segment Results

Agricultural segment results were as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Net sales	$	151,112	$	187,328
Gross profit		23,890		24,920
Income from operations		19,955		20,085

Net sales in the agricultural market were $151.1 million for the first quarter of 2010, as compared to $187.3 million in 2009. The Company’s agricultural segment sales were approximately 19% lower than the sales recorded in the first quarter of 2009. Although lower than the previous year’s first quarter, agricultural segment sales for the first quarter of 2010 were significantly higher than those recorded in the third and fourth quarters of the previous year.

Gross profit in the agricultural market was $23.9 million for the first quarter of 2010, compared to $24.9 million in 2009. Income from operations in the agricultural market was $20.0 million for the first quarter of 2010, compared to $20.1 million for the first quarter of 2009. Despite the lower sales, the gross profit and income from operations were nearly the same due to improved manufacturing efficiencies, including reduced headcount, in the agricultural segment.

Earthmoving/Construction Segment Results

Earthmoving/Construction segment results were as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Net sales	$	41,815	$	39,927
Gross profit		3,150		4,884
Income from operations		690		3,840

The Company’s earthmoving/construction market net sales were $41.8 million for the first quarter of 2010, as compared to $39.9 million in 2009. The sales in the earthmoving/construction segment remain at low levels, off nearly 50 percent from 2007 highs. A primary reason for the low sales levels in this segment was the continued weakness in the construction areas related to commercial, residential and infrastructure industries.

Gross profit in the earthmoving/construction market was $3.2 million for the first quarter of 2010, as compared to $4.9 million in 2009. Income from operations in the earthmoving/construction market was $0.7 million for the first quarter of 2010 versus $3.8 million in 2009. First quarter 2010 income from operations in the earthmoving/construction segment was negatively impacted by manufacturing inefficiencies including depreciation on the giant OTR assets of approximately $1 million and higher R&D expenses of approximately $1 million related to giant OTR products.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

Consumer Segment Results

Consumer segment results were as follows (amounts in thousands):

	Three months ended March 31,
	2010		2009
Net sales	$	3,521	$	5,349
Gross profit		668		788
Income from operations		581		637

Consumer market net sales were $3.5 million for the first quarter of 2010, as compared to $5.3 million in 2009. The continued reduction in consumer market sales is attributed to the sustained contraction in consumer discretionary spending resulting from the on-going economic conditions.

Gross profit from the consumer market was $0.7 million for the first quarter of 2010, as compared to $0.8 million in 2009. Consumer market income from operations was $0.6 million for each of the three months ended March 31, 2009 and 2010. The consumer segment continues as a complementary and contributing part of the Company’s overall business.

Segment Summary (amounts in thousands)

Three months ended March 31, 2010	Agricultural		Earthmoving/ Construction		Consumer		Corporate Expenses			Consolidated Totals
Net sales	$	151,112	$	41,815	$	3,521	$	0		$	196,448
Gross profit (loss)		23,890		3,150		668		(1,621	)		26,087
Income (loss) from operations		19,955		690		581		(11,096	)		10,130

Three months ended March 31, 2009
Net sales	$	187,328	$	39,927	$	5,349	$	0		$	232,604
Gross profit (loss)		24,920		4,884		788		(529	)		30,063
Income (loss) from operations		20,085		3,840		637		(10,485	)		14,077

Corporate Expenses

Income from operations on a segment basis does not include corporate expenses or depreciation and amortization expense related to property, plant and equipment carried at the corporate level totaling $11.1 million for the first quarter of 2010, as compared to $10.5 million for the first quarter of 2009.

Corporate expenses for the first quarter of 2010 were composed of selling and marketing expenses of approximately $4½ million and administrative expenses of approximately $6½ million.

Corporate expenses for the first quarter of 2009 were composed of selling and marketing expenses of approximately $5 million and administrative expenses of approximately $5½ million.

Corporate administrative expenses were approximately $1 million higher in the first quarter of 2010 primarily as the result of higher group insurance expenses that were recorded on corporate entities.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

MARKET RISK SENSITIVE INSTRUMENTS

The Company’s risks related to foreign currencies, commodity prices and interest rates are consistent with those for 2009. For more information, see the “Market Risk Sensitive Instruments” discussion in the Company’s Form 10-K for the fiscal year ended December 31, 2009.

LIQUIDITY AND CAPITAL RESOURCES

Cash Flows

As of March 31, 2010, the Company had $215.2 million of cash balances within various bank accounts. This cash balance decreased by $14.0 million from December 31, 2009, due to the following cash flow items.

(amounts in thousands)
	March 31,		December 31,
	2010		2009
Cash	$	215,215	$	229,182

Operating cash flows

Summary of cash flows from operating activities:

(amounts in thousands)	Three months ended March 31,
	2010			2009			Change
Net income	$	2,078		$	7,041		$	(4,963	)
Depreciation and amortization		9,281			7,966			1,315
Deferred income tax provision		1,275			0			1,275
Accounts receivable		(34,789	)		729			(35,518	)
Inventories		(19,462	)		(20,325	)		863
Accounts payable		22,432			(11,586	)		34,018
Other operating activities		9,046			2,171			6,875
Cash used for operating activities	$	(10,139	)	$	(14,004	)	$	3,865

For the first quarter of 2010, operating activities used cash of $10.1 million. This cash was primarily used by increases in accounts receivable and inventory of $34.8 million and $19.5 million, respectively, offset by higher accounts payable of $22.4 million. Net income of $2.1 million included $9.3 million of noncash charges for depreciation and amortization. Deferred tax assets were reduced by $1.3 million as the Company used current income to reduce the deferred tax asset for previously recorded net operating losses.

In the first quarter of 2009, operating activities used cash of $14.0 million. This cash was primarily used by increases in inventory of $20.3 million and a reduction in accounts payable of $11.6 million, offset by net income of $7.0 million. Included in net income were $8.0 million of noncash charges for depreciation and amortization.

Operating cash flows increased $3.9 million when comparing the first quarter of 2010 to the first quarter of 2009. Net income in the first quarter of 2010 was $5.0 million lower than net income in the first quarter of 2009. When comparing the first quarter of 2010 to the first quarter of 2009, cash flows from accounts receivable decreased $35.5 million and cash flows from accounts payable increased $34.0 million. This is the result of major increases in accounts receivable and accounts payable in the first quarter of 2010, as sales increased approximately 34% when comparing the first quarter of 2010 to the previous quarter (fourth quarter of 2009). In the first quarter of 2009, sales were more in line with that of the previous quarter.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

Investing cash flows

Summary of cash flows from investing activities:

(amounts in thousands)	Three months ended March 31,
	2010			2009			Change
Capital expenditures	$	(3,508	)	$	(19,933	)	$	16,425
Other investing activities		42			(2,387	)		2,429
Cash used for investing activities	$	(3,466	)	$	(22,320	)	$	18,854

Net cash used for investing activities was $3.5 million in the first quarter of 2010, as compared to $22.3 million in the first quarter of 2009. The Company invested a total of $3.5 million in capital expenditures in the first quarter of 2010, compared to $19.9 million in 2009. Of the $19.9 million of capital expenditures in the first quarter of 2009, approximately $12 million related to the Company’s giant OTR mining project, which was substantially completed at the end of 2009. The remaining 2009 and the 2010 expenditures represent various equipment purchases and improvements to enhance production capabilities. Other investing activities in the first quarter of 2009 related primarily to the Company’s $2.4 million purchase of additional shares in Titan Europe Plc.

Financing cash flows

Summary of cash flows from financing activities:

(amounts in thousands)	Three months ended March 31,
	2010			2009			Change
Repurchase of senior notes	$	0		$	(4,726	)	$	4,726
Proceeds from exercise of stock options		0			800			(800	)
Payment of financing fees		(186	)		(1,070	)		884
Other financing activities		(176	)		(108	)		(68	)
Cash used for financing activities	$	(362	)	$	(5,104	)	$	4,742

For the first quarter of 2010, $0.4 million of cash was used for financing activities.

In the first quarter of 2009, $5.1 million of cash was used for financing activities. This cash was primarily used for repurchase of senior notes of $4.7 million.

Financing cash flows increased $4.7 million when comparing the first quarter of 2010 to the first quarter of 2009. This change was primarily the result of the repurchase of senior notes in the first quarter of 2009.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

Debt Covenants

The Company’s revolving credit facility (credit facility) contains various covenants and restrictions. The financial covenants in this agreement require that:

·	Collateral coverage be equal to or greater than 1.2 times the outstanding revolver balance.

·	If the 30-day average of the outstanding revolver balance exceeds $125 million, the fixed charge coverage ratio be equal to or greater than a 1.0 to 1.0 ratio.

Restrictions include:

·	Limits on payments of dividends and repurchases of the Company’s stock.

·	Restrictions on the ability of the Company 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 these loan agreements.

The Company is in compliance with these covenants and restrictions as of March 31, 2010. The collateral coverage ratio was not applicable as there were no outstanding borrowings under the revolving credit facility at March 31, 2010. The fixed charge coverage ratio did not apply for the quarter ended March 31, 2010. In connection with the convertible senior subordinated note offer, Titan previously agreed to add an additional mutually agreeable covenant to the Company's revolving credit facility, which is now no longer required by mutual agreement of the parties.

Other Issues

The Company’s business is subject to seasonal variations in sales that affect inventory levels and accounts receivable balances. Historically, Titan tends to experience higher sales demand in the first and second quarters.

Liquidity Outlook

At March 31, 2010, the Company had $215.2 million of cash and cash equivalents and no outstanding borrowings on the Company’s $150.0 million credit facility.

Capital expenditures for the remainder of 2010 are forecasted to be approximately $10 million to $12 million. Cash payments for interest are currently forecasted to be approximately $13 million for the remainder of 2010 based on March 31, 2010, debt balances.

In the future, Titan may seek to grow by making acquisitions which will depend on the ability to identify suitable acquisition candidates, to negotiate acceptable terms for their acquisition and to finance those acquisitions. In September 2009, Titan signed a letter of intent with The Goodyear Tire & Rubber Company to purchase certain farm tire assets, including the Goodyear Dunlop Tires France (GDTF) Amiens North factory. This agreement is non-binding and will be subject to GDTF’s satisfactory completion of a social plan related to consumer tire activity at the Amiens North facility, along with completion of due diligence, a definitive acquisition agreement and other standard acquisition approval requirements. At this time, the due diligence process continues. There is no assurance th at definitive agreements will be executed or that the acquisition will be consummated.

Subject to the terms of indebtedness, the Company may finance future acquisitions with cash on hand, cash from operations, additional indebtedness and/or by issuing additional equity securities.

Cash on hand, anticipated internal cash flows from operations and utilization of remaining available borrowings are expected to provide sufficient liquidity for working capital needs, capital expenditures and potential acquisitions. If the Company were to exhaust all currently available working capital sources or not meet the financial covenants and conditions of its loan agreements, the Company’s ability to secure additional funding would be negatively impacted.

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

PENSIONS

The Company has three frozen defined benefit pension plans and one defined benefit plan that previously purchased a final annuity settlement. These plans are described in Note 20 of the Company’s Notes to Consolidated Financial Statements in the 2009 Annual Report on Form 10-K.

The Company’s recorded liability for pensions is based on a number of assumptions, including discount rates, rates of return on investments, mortality rates and other factors. Certain of these assumptions are determined by the Company with the assistance of outside actuaries. Assumptions are based on past experience and anticipated future trends. These assumptions are reviewed on a regular basis and revised when appropriate. Revisions in assumptions and actual results that differ from the assumptions affect future expenses, cash funding requirements and the carrying value of the related obligations. Titan expects to contribute approximately $2 million to these frozen defined pension plans during the remainder of 2010.

NEW ACCOUNTING STANDARDS

Fair Value Measurements and Disclosures

Subsequent Events

TITAN INTERNATIONAL, INC.

Management’s Discussion and Analysis of

Financial Condition and Results of Operations

MARKET CONDITIONS AND OUTLOOK

The on-going uncertainty in domestic and global economic conditions makes it difficult to forecast future sales levels. In the first quarter of 2010, Titan experienced a sales decline as compared to the first quarter of 2009. Titan may experience continued sales declines in each of the Company’s markets for the first part of 2010. Although the short-term outlook is for continued sales declines, the Company has seen signs that the market may currently be experiencing the bottom of the cycle. Titan’s total sales for the first quarter of 2010 increased by approximately 34% when compared to last year’s fourth quarter. The Company is cautiously optimistic that sales may continue to move higher during the remainder of 2010; however, there can be no assurance that the decli ne in sales will not resume.

Energy, raw material and petroleum-based product costs have been exceptionally volatile and may negatively impact the Company’s margins. Many of Titan’s overhead expenses are fixed; therefore, lower seasonal trends may cause negative fluctuations in quarterly profit margins and affect the financial condition of the Company.

AGRICULTURAL MARKET OUTLOOK

Agricultural market sales were down in the first quarter of 2010 when compared to the first quarter of 2009. However, agricultural market sales increased over 36% when compared to last year’s fourth quarter. Commodity prices have declined from recent highs, but remain above the long-term average. The gradual increase in the use of biofuels may help sustain future production. However, the magnitude and duration of the domestic and global economic downturn makes it extremely difficult to forecast future sales levels. Many variables, including weather, grain prices, export markets and future government policies and payments can greatly influence the overall health of the agricultural economy.

EARTHMOVING/CONSTRUCTION MARKET OUTLOOK

Sales for the earthmoving/construction market are expected to remain challenging for the rest of 2010 as a result of the on-going uncertainty in domestic and global economic conditions. The magnitude and duration of these conditions make it difficult to forecast future sales levels. Metals, oil and gas prices have retreated from 2008’s highs as a result of the current economic conditions. In the long-term, these prices are expected to return to levels that are attractive for continued investment, which should help support future earthmoving and mining sales. However, many producers are currently delaying new investments which will affect future sales levels. The significant decline in the United States housing market continues to cause a major reduction in demand for equipment u sed for construction. The earthmoving/construction segment is affected by many variables, including commodity prices, road construction, infrastructure, government appropriations, housing starts and the on-going banking and credit issues. For the remainder of 2010, the Company expects modest improvement compared to the previous year’s low sales levels in the earthmoving/construction market.

CONSUMER MARKET OUTLOOK

Consumer discretionary spending has experienced a major contraction as a result of on-going economic issues, housing market decline, and high unemployment rates. Many of the Company’s consumer market sales are ultimately used in items which fall into the discretionary spending category. There is no clear consensus among economists as to when there will be a sustained consumer spending rebound. Many factors continue to affect the consumer market including weather, competitive pricing, energy prices and consumer attitude. For the remainder of 2010, the Company expects continued weakness in consumer spending related to Titan’s consumer market.

TITAN INTERNATIONAL, INC.

PART I. FINANCIAL INFORMATION

Item 3. Quantitative and Qualitative Disclosures About Market Risk

See the Company’s 2009 Annual Report filed on Form 10-K (Item 7A). There has been no material change in this information.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

The Company’s principal executive officer and principal financial officer have concluded the Company’s disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) are effective as of the end of the period covered by this Form 10-Q based on an evaluation of the effectiveness of disclosure controls and procedures.

Changes in Internal Controls

There were no material changes in internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) that occurred during the first quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Because of its inherent limitations, internal controls over financial reporting may not prevent or detect misstatements. Also, projections of any evaluations of the effectiveness to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

TITAN INTERNATIONAL, INC.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Item 1A. Risk Factors

38. See the Company’s 2009 Annual Report filed on Form 10-K (Item 1A). There has been no material change in this information.

Item 6. Exhibits

10.1	Trademark License Agreement with The Goodyear Tire & Rubber Company
10.2	Supply Agreement with Deere & Company – August 2006
10.3	Supply Agreement with Deere & Company – April 2008
31.1	Certification of the Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	Certification of the Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	TITAN INTERNATIONAL, INC.
	(Registrant)

Date:	April 23, 2010	By:	/s/ MAURICE M. TAYLOR JR.
			Maurice M. Taylor Jr.
			Chairman and Chief Executive Officer (Principal Executive Officer)

	By:	/s/ KENT W. HACKAMACK
		Kent W. Hackamack
		Vice President of Finance and Treasurer
		(Principal Financial Officer)

EX-10.1 2 ex10_1.htm TRADEMARK LICENSE AGREEMENT WITH THE GOODYEAR TIRE & RUBBER COMPANY ex10_1.htm

Exhibit 10.1

TRADEMARK LICENSE AGREEMENT

THIS TRADEMARK LICENSE AGREEMENT (“LICENSE”) dated as of December 28, 2005 is made and entered into between The Goodyear Tire & Rubber Company (“GOODYEAR”), an Ohio corporation whose address is 1144 East Market Street, Akron, Ohio 44316, (“LICENSOR”), and Titan Tire Corporation (“LICENSEE”), an Illinois Corporation whose address is 2701 Spruce Street, Quincy, Illinois 62301. “Parties” shall mean LICENSOR and LICENSEE.

RECITALS

WHEREAS, GOODYEAR and LICENSEE are parties to the Asset Purchase Agreement, dated as of February 28, 2005, by and among GOODYEAR, Goodyear Canada Inc., Goodyear Servicios Comerciales, S. de R.L. de C.V., The Kelly-Springfield Tire Corporation (collectively, the “Goodyear Parties”) and LICENSEE (the “Purchase Agreement”);

WHEREAS, pursuant to the Purchase Agreement, on the terms and subject to the conditions set forth therein, the Goodyear Parties have agreed to convey to LICENSEE the GOODYEAR farm tire assets in North America, including certain property, equipment, inventory and other assets associated with the manufacture of farm tires and the plant, property and equipment at GOODYEAR’s Freeport, Illinois tire manufacturing facility, as more fully described in the Purchase Agreement;

WHEREAS, in connection with the purchase of the Business, and pursuant to the Purchase Agreement, GOODYEAR and LICENSEE have or will enter into the Purchase Agreement, and the Ancillary Agreements, and are obligated to execute and deliver this LICENSE;

WHEREAS, LICENSOR and its wholly owned subsidiary, Goodyear Canada Inc. (“Goodyear Canada”), own the LICENSED MARKS identified in Schedule B; which have been used in connection with farm tires;

WHEREAS, LICENSEE desires to use the LICENSED MARKS upon and in connection with the manufacture, sale, promotion, marketing, advertising and distribution of LICENSED PRODUCTS; and

WHEREAS, the Parties agree that LICENSOR shall grant to LICENSEE a license to use the LICENSED MARKS in the manufacture, sale, promotion, marketing, advertising, and distribution of LICENSED PRODUCTS, subject to the terms and conditions herein;

NOW, THEREFORE, in consideration of the premises and the mutual promises and obligations contained herein, the Parties agree as follows:

DEFINITIONS

As used in this LICENSE, and unless the context requires a different meaning, the following terms have the meanings indicated (the meanings to be, when appropriate, equally applicable to both singular and plural forms of the terms defined):

“LICENSED MARKS” means (1) LICENSOR’S trademarks, service marks, trade names, and designs and symbols identified in Schedule B, which may be amended from time to time as provided herein, (2) the word mark GOODYEAR as set forth in Schedule B, and (3) any and all names, symbols, designs, and

Portions of this exhibit were omitted and filed separately with the Secretary of the Commission pursuant to an application for confidential treatment filed with the Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934. Such portions are marked by a series of asterisks.

other insignia that are embedded in the tire molds transferred to LICENSEE under the Purchase Agreement.

“LICENSED PRODUCTS” means Front Farm Tires (including Radial Front Farm Tires), Implement Tires, Bias Rear Farm Tires, Radial Rear Farm Tires, Large Terra, Small Terra, Skid Steer Tires, Special Floatation Tires, and all other tires identified in the Goodyear 2003 Farm Tire catalog, incorporated herein by reference, except such tires excluded in Schedule 2.2(p)(i) – 2.2 (p)(iii) of the Purchase Agreement, copies of which are attached as Schedule C hereto (collectively, ‘Farm Tires”) and that (a) bear one or more LICENSED MARKS, and/or (b) are packaged, advertised, promoted, or marketed in conjunction with the LICENSED MARKS such that a reasonable purchaser would understand the Farm Tires to be those offered by, endorsed by, affiliated with, or sponsored by Licensor; provided, however, that “LICENSED PRODUCTS” does not include any product, or portion of a product, that happens to be combined with Farm Tires (by way of example and not limitation, LICENSED PRODUCTS does not include the wheel on which the Farm Tire is mounted and does not include the services of mounting the Farm Tire on the wheel, but would only include the Farm Tire).

“LICENSED TERRITORY” means the United States of America, Canada, Mexico, and their territories and possessions.

“NET SALES” means the gross amount invoiced to customers for sales of the LICENSED PRODUCTS, less only (a) returns actually made and credited as properly supported by documentation (provided, however, that ** ) and (b) other items described in Exhibit X hereto.

“CHANGE OF CONTROL” means the occurrence of any of the following events unless LICENSOR consents in advance: (1) a Person, directly or indirectly, acquires “control,” as that term is defined in the Securities Exchange Act of 1934, as amended, and the regulations promulgated thereunder (collectively, the “Exchange Act”) of LICENSEE or Titan International, Inc. (“Parent”), (2) a competitor or any Affiliate of any competitor of LICENSOR, or of any of LICENSOR’S Affiliates, acquires direct or indirect beneficial ownership (as defined in the Exchange Act) of more than five (5%) percent of the outstanding equity securities of LICENSEE or Parent, or LICENSEE or Parent becomes an Affiliate, directly or indirectly, of any compe titor of LICENSOR or any of LICENSOR’S Affiliates or (3) the shareholders of LICENSEE or of Parent approve, or LICENSEE or Parent otherwise effects, enters into or approves, (A) a merger or consolidation of LICENSEE or Parent with or into any other Person, (B) an agreement for the sale or disposition (in one transaction or a series of transactions) of all or substantially all of the assets of LICENSEE or Parent, (C) a plan of complete liquidation of LICENSEE or Parent (other than a liquidation, consolidation or merger of LICENSEE into Parent as a result of which Parent succeeds to the obligations of LICENSEE (x) hereunder, (y) under the Purchase Agreement and (z) under the Ancillary Agreements to which LICENSEE is a party) or (D) any transaction similar to any of the foregoing; provided, however, that the term “CHANGE OF CONTROL” shall not include the occurrence of any event described in Clauses (1) or (3) above that is a “going private” transaction, a “management-led̶ 1; buy out or any other similar CHANGE OF CONTROL event as a result of which immediately after such event (i) the chief executive officer or one or more other current shareholders, Affiliates, directors or officers of Parent continue in management and they and/or their debt and/or equity sponsors, and/or an investment firm of which such a director is an officer or any subsidiary of Parent, either individually or as a group (excluding any Person other than Parent, an Affiliate of Parent or Titan Europe Plc (to the extent Parent continues to hold not less than 25% of the outstanding voting power therein) that is a competitor of LICENSOR or any of LICENSOR’S Affiliates) would own a majority of the outstanding voting securities

or voting interest in, as applicable, the surviving or resulting Person or the Person succeeding to control of, or all or substantially all of the assets of, LICENSEE or Parent, and (ii) such Person would be bound by the terms hereof, including Section 12.2, and would succeed to the obligations described in Clause (C) above.

“WRITTEN APPROVAL/CONSENT/AUTHORIZATION” means approval or consent granted by LICENSOR by written means signed by an authorized representative of LICENSOR.

Other Definitions. Capitalized terms not otherwise defined in this LICENSE shall have the definition set forth in the Purchase Agreement.

Definitions Can be Substantive. If any provision in a definition is a substantive provision conferring rights or imposing obligations on any party hereto, notwithstanding that it appears only in this Definitions section hereof, effect shall be given to it as if it were a substantive provision of this LICENSE.

Definitions Not in This Section of the LICENSE. Where any term is defined within the context of any particular Section or Clause in this LICENSE, the term so defined, unless it is clear from the Section or Clause in question that the term so defined has limited application to the relevant Section or Clause, shall bear the meaning ascribed to it for all purposes in terms of this LICENSE, notwithstanding that this term has not been defined in this section of the LICENSE.

Non-Business Day Performance. Where any payment falls due or any other obligation is to be performed on a day, that is not a Business Day in the jurisdiction where such payment is to be made or such obligation is to be performed, then such payment shall be made or such obligation performed on the next succeeding Business Day.

Calculation of Day Periods. Except as otherwise specifically provided in this LICENSE, where in this LICENSE any number of days is prescribed in relation to the doing of a particular thing or in respect of a period of time, those days will be calculated exclusive of the first day and inclusive of the last day.

TERMS AND CONDITIONS

1. GRANT OF LICENSE

1.1

Grant. Subject to the terms herein, LICENSOR grants to LICENSEE a non-exclusive, revocable (solely as set forth in this License), non-transferable license, without the right to sublicense, to use the LICENSED MARKS on and in connection with the manufacture of LICENSED PRODUCTS in the United States and in connection with the sale, promotion, marketing, advertising, and distribution of the LICENSED PRODUCTS within the LICENSED TERRITORY. This LICENSE may not, except in respect of any event that would constitute a CHANGE OF CONTROL but is excluded from the definition of CHANGE OF CONTROL hereunder as a result of the proviso set forth therein, be assigned without written authorization from LICENSOR, which may be withheld for any reason or for no reason. Nothing in this LICENSE sha ll limit the right of LICENSEE’S dealers, distributors, resellers, and other third parties in LICENSEE’S distribution network for the LICENSED PRODUCTS from using the LICENSED MARKS in connection with the sale, promotion, marketing, advertising, and distribution of the LICENSED PRODUCTS within the LICENSED TERRITORY during the Term. All rights not specifically granted to LICENSEE herein are reserved by LICENSOR, or

Goodyear Canada. As to any trademark rights in the LICENSED MARKS which may be in the name of Goodyear Canada, GOODYEAR shall enter into an appropriate agreement with Goodyear Canada.

Nothing in this LICENSE shall restrict LICENSOR’S current or future commitments under secured lending or financing arrangements pledging the LICENSED MARKS.

1.2

Specifically Prohibited Uses of the LICENSED MARKS. Unless expressly authorized by this LICENSE, LICENSEE will not use any of the LICENSED MARKS or any confusingly similar terms (a) in any corporate titles, trade styles, business names, domain names or URL’s, (b) in connection with any service or repairs, or (c) in the white pages of telephone and other directories.

LICENSEE is permitted to create signs which read “Goodyear Farm Tires.” Any other usage of the LICENSED MARKS, including use on signs that are not covered by Goodyear Identification Agreements, requires the express written consent of GOODYEAR.

LICENSEE acknowledges that LICENSOR has removed certain signs and other GOODYEAR or Kelly identification at the Freeport Facility and LICENSEE agrees to remove all remaining GOODYEAR or Kelly signs or other forms of GOODYEAR or Kelly identification (and any other identification bearing any of the Goodyear Names and Marks) found on buildings, vehicles, uniforms, business forms or elsewhere at the Freeport, Illinois facility within six (6) months of the Closing Date.

1.3

Permitted Use in Advertising and Distribution. Subject to the requirements of section 7.4 and this section, LICENSEE shall be entitled to use the LICENSED MARKS to advertise, describe, solicit, demonstrate, sell, distribute, and otherwise promote the sale, repair, and service of the LICENSED PRODUCTS in all media now known or later developed, but shall not be entitled to own URL’s which include GOODYEAR trademarks. At no time shall LICENSEE use the trademark “Goodyear” without the descriptive terms comprising the LICENSED PRODUCTS.

1.4

Use by Those in the Distribution Network. The grant of license does not include the right to sublicense; however, nothing in this LICENSE shall limit the right of LICENSEE’S dealers, distributors, resellers and others in LICENSEE’S distribution network of the LICENSED PRODUCTS from using the LICENSED MARKS in connection with the sale, promotion, marketing, advertising, and distribution of the LICENSED PRODUCTS within the LICENSED TERRITORY during the term of the LICENSE.

1.5

No Other Right To LICENSED MARKS, LICENSOR’S Other Intellectual Property or Third Party Marks. This LICENSE conveys to LICENSEE no rights with respect to the LICENSED MARKS other than specifically set forth herein. LICENSEE acknowledges that LICENSOR is the owner of certain trademarks, trade dress, copyrights, design patents, and other intellectual property rights that are not included in the LICENSED MARKS (“Other Trademarks”). LICENSEE understands and agrees that it does not have authorization to use the Other Trademarks in any manner whatsoever, nor does this LICENSE grant rights to intellectual property of any other party. LICENSEE must independently obtain any authorization, license or permission for use of third party intellectual property us ed in conjunction with the LICENSED

MARKS and, upon request by LICENSOR, LICENSEE shall furnish written proof of such authorization.

1.6

LICENSEE’S Rights Outside LICENSED TERRITORY. Except for tires mounted on original equipment vehicles within the LICENSED TERRITORY, and tires furnished to LICENSOR’S Affiliates under the Supply Agreement, LICENSEE agrees that it possesses no rights to sell the LICENSED PRODUCTS (a) itself, (b) to exporters, or (c) directly or indirectly to others for resale or reshipment outside the LICENSED TERRITORY. In the event that LICENSEE becomes aware that any party to whom it sells the LICENSED PRODUCTS intends to sell or ship, or is selling or shipping directly or indirectly, the LICENSED PRODUCTS outside of the LICENSED TERRITORY, LICENSEE shall take all necessary actions which are legally permissible to prevent such sales or shipments.

1.7

LICENSOR’S Rights Within the LICENSED TERRITORY. Except for tires owned by LICENSOR or its Affiliates on the Closing Date, and except for tires mounted on original equipment vehicles outside the LICENSED TERRITORY, tires furnished or sold by LICENSEE to LICENSOR or its Affiliates under the Supply Agreement and tires the ownership or sale of which is permitted under the Purchase Agreement, LICENSOR agrees that it possesses no right to sell the LICENSED PRODUCTS (a) itself, (b) to exporters, or (c) directly or indirectly to others for resale or reshipment within the LICENSED TERRITORY; provided, however, that, during the Term, LICENSOR shall either terminate the rights of any Affiliates to use the LICENSED MARKS in the LICENSED TERRITORY in connection with any and all of the LICENSED PRODUCTS or shall otherwise ensure that Affiliates do not use the LICENSED MARKS in the LICENSED TERRITORY in connection with the LICENSED PRODUCTS except as provided in Sections 6.12 and 6.17 of the Purchase Agreement. In the event that LICENSOR or its Affiliates become aware that any party to whom they sell the LICENSED PRODUCTS intends to sell or ship, or is selling or shipping directly or indirectly, the LICENSED PRODUCTS into the LICENSED TERRITORY, LICENSOR shall take all necessary actions which are legally permissible to prevent such sales or shipments.

Without limiting the generality of and notwithstanding anything set forth in this Section 1.7, nothing herein shall be deemed to restrict the right of LICENSOR, or any of its Affiliates to sell original equipment tires mounted by LICENSOR or its Affiliates or by others outside the LICENSED TERRITORY, even with the expectation that such tires will be reshipped to the LICENSED TERRITORY. LICENSOR’S and its Affiliates’ rights under this Section 1.7 are assignable and may be licensed to third parties; provided that LICENSOR shall give LICENSEE written notice to LICENSEE identifying all such third parties prior to any assignment or license effected pursuant to or in connection with any sale of all or substantially all of the farm tire assets of LICENSOR and its Affiliates , collectively.

1.8	Modifications by LICENSOR.

(a) Modifications of trademarks other than GOODYEAR (word mark) and GOODYEAR (and winged foot design).

LICENSEE acknowledges that, from time to time and without LICENSEE’S approval, LICENSOR may modify certain elements of the LICENSED MARKS, add new LICENSED MARKS, or discontinue the use of certain LICENSED MARKS. Accordingly, LICENSOR does

not represent or warrant that the LICENSED MARKS or any of their elements will be maintained or used in any particular fashion. In the event that LICENSOR makes modifications to the LICENSED MARKS other than GOODYEAR (word mark) and GOODYEAR (and winged foot design), this LICENSE will be subject to any such modifications effective upon written notification from LICENSOR; however, LICENSEE shall be allowed a reasonable sell-off period for any existing inventory of LICENSED PRODUCTS bearing discontinued or modified LICENSED MARKS. A “reasonable sell-off period” resulting from claim of trademark infringement will be as short as practical.

(b) Modifications of the GOODYEAR (and winged foot) logo and designs found in the molds.

LICENSOR will not discontinue the GOODYEAR (word mark) and GOODYEAR (and winged foot design) marks during the term of this LICENSE. In the event LICENSOR modifies these marks, LICENSEE will modify the GOODYEAR logo, tread designs, other designs and trade dress as molds are replaced. There will be no limitation on the time period that LICENSEE is authorized to sell goods bearing the versions of the GOODYEAR (word mark) and GOODYEAR (and winged foot design) subsequent to such modifications.

1.9

Manufacture of Kelly-Springfield and Power Mark Tires. For a period of up to one year from the Closing Date, LICENSOR will permit LICENSEE to manufacture Farm Tires bearing the Kelly-Springfield and/or Power Mark trademarks for warranty and replacement purposes and in order to allow an orderly transition of existing Kelly retailers to the Titan or GOODYEAR brands. LICENSEE agrees to be bound by the indemnity, royalty, and other provisions of the LICENSE with respect to any such Kelly or Power Mark tires manufactured or sold during this phase out period as if such tires constituted LICENSED PRODUCTS hereunder.

1.10

Use of LICENSEE’S Name. Nothing in this Agreement shall limit the right of LICENSEE to use its own name on or in connection with the LICENSED PRODUCTS so as to accurately identify itself as the manufacturer of the LICENSED PRODUCTS, including but not limited to the phrase “MADE BY TITAN” or “MANUFACTURED BY TITAN TIRE CORPORATION” or other such accurate description of source.

1.11

Certain Grants. Subject to the rights reserved under Section 1.7 and the rights under any non-exclusive licenses to Affiliates of LICENSOR (as further set forth in Section 1.7), and subject to the rights, including security interests, of Persons that have heretofore provided, or that may, from time to time after the date hereof, provide, financing to LICENSOR, LICENSOR agrees that it will not, during the term hereof, grant any license to any Person to use the LICENSED MARKS with respect to the LICENSED PRODUCTS in the LICENSED TERRITORY.

The obligations of LICENSOR set forth in the first sentence of this Section 1.11 are material to this LICENSE and the relationship between LICENSOR and LICENSEE.

If LICENSOR breaches the obligations of LICENSOR set forth in the first sentence of this Section 1.11 and does not cure such breach within sixty (60) days after receipt of notice (or thirty (30) days, in the event of unauthorized use by Affiliates of the LICENSED MARKS in connection with the LICENSED PRODUCTS), LICENSOR shall immediately owe LICENSEE, and shall promptly pay LICENSEE, **

2. TERM

2.1

Initial Term. This LICENSE shall be effective on the date written in line one (1) of this LICENSE (the “Effective Date”) and shall expire at the end of seven (7) Contract Periods unless sooner terminated under operation of law or in accordance with the terms and conditions herein or renewed as provided herein (the “Term”).

2.2	Contract Periods. Contract period one (1) shall begin on the Effective Date and end twelve (12) months later. Each consecutive twelve-month period thereafter shall be deemed a Contract Period.

2.3	Notice of Termination. LICENSOR may in its sole discretion terminate this LICENSE by giving three (3) years written notice prior to the end of any Contract Period beginning with Contract Period number four (4).

2.4	Renewal Term. Unless LICENSOR provides notice of termination, after the initial Term of seven (7) years this LICENSE shall automatically renew for successive one (1) year Contract Periods unless sooner terminated as provided in this LICENSE.

3. ROYALTIES

3.1

Earned Royalties. In each Contract Period, LICENSEE shall pay to LICENSOR a ** royalty based on the NET SALES of all LICENSED PRODUCTS sold (“Earned Royalties”). For purposes of this LICENSE, a LICENSED PRODUCT shall be considered sold on the date upon which such LICENSED PRODUCT is billed, invoiced, shipped, or paid for, or when title passes to the buyer, whichever occurs first.

3.2

3.3

No Deductions. Unless specified otherwise in the attached Schedules or the definition of NET SALES, computation of NET SALES (including the computation of the gross price invoiced to customers) shall not include deductions for defective return allowances greater than **, uncollectible accounts, new store allowance(s), advertising allowance(s), co-op allowance(s), costs incurred in the manufacture, sale, distribution, advertising, promotion, or exploitation of the LICENSED PRODUCTS, or any indirect or overhead expense of any kind whatsoever. Similarly, such deductions and costs shall not be deducted from gross sales or Earned Royalties.

3.4	Sales to Governmental Authorities. LICENSEE’S sales to governmental authorities under supply agreements entered into by LICENSOR shall have priority over sales to LICENSEE’S customers or other sales to LICENSOR.

3.5

4. STATEMENTS AND PAYMENTS

4.1	Statements.

(a)

Statement Content. Within thirty (30) days following the last day of each calendar quarter, LICENSEE shall furnish to LICENSOR a complete and accurate statement (in the format attached as Exhibit I) of its sales of LICENSED PRODUCTS during the preceding calendar quarter. Such statement shall be certified as accurate by LICENSEE’S Chief Financial Officer and shall indicate the following for each LICENSED PRODUCT by country: (a) a description of the LICENSED PRODUCT, including SKU number; (b) gross sales price of the LICENSED PRODUCT; (c) the number of units sold; ( d) any itemized deductions from gross sales price which are expressly permitted hereunder; (e) NET SALES of the LICENSED PRODUCT distributed and/or sold by LICENSEE during the quarter; (f) any returns made and credited during the preceding calendar quarter; and (g) a calculation of Earned Royalties.

(b)

Statement Requirements. Such statements shall be submitted whether or not any sales of the LICENSED PRODUCTS occurred during the preceding calendar quarter. The receipt or acceptance by LICENSOR of any of the statements furnished pursuant to this LICENSE or of any royalties paid (or the cashing of any royalty checks paid by LICENSEE) shall not preclude LICENSOR from auditing, questioning or objecting to the accuracy of such statements or royalties at any time. In the event that any inconsistencies or mistakes are discovered in such statements or payments, they shall immediately be rectified.

4.2

Payments.

(a)

Payment Requirements. LICENSEE shall remit within thirty (30) days following the last day of each calendar quarter, together with the statement required for that quarter, a payment of the Earned Royalties due from sales during the preceding quarter. For any Contract Period where the Earned Royalties do not meet or exceed the Minimum Guarantee, in the fourth quarterly payment for that Contract Period LICENSEE shall pay the balance of the fees required to meet the Minimum Guarantee. All payments made hereunder shall be in United States currency (converted from any foreign currency at the spot rate of exchange for United States Dollars as published by The Wall Street Journal in New York, NY, USA, as of the last business day of the quarter for which payment is being made) and shall be remitted by wire transfer into such account as is designated by LICENSOR. LICENSOR reserves the right to reject any other form of payment. LICENSEE shall have no right to set off any money owed to LICENSEE by LICENSOR against any money owed by LICENSEE to LICENSOR hereunder.

(b)

Late Payments. If any payments due hereunder are not timely paid, LICENSEE shall pay interest on the amount owed at a rate of one and one-half percent (1½%) per month (or the maximum rate allowed by law if lower) from the date such amount was due until it is paid. If it becomes necessary for LICENSOR to undertake legal action to collect any such payments, LICENSEE shall pay LICENSOR’S actual and reasonable outside legal fees and costs of the action and related negotiations if the legal action undertaken results in a determination that the payments were due.

(c)

All payments. Payments of whatever nature due to LICENSOR under this LICENSE shall be net without any deductions whatsoever and shall be increased by the amount of

any tax, charge or levy which may be imposed on or with respect to such payments by the national or local governments save to the extent that such amount may lawfully be taken by LICENSOR as a credit against income tax payable by LICENSOR under the laws of the United States of America. Upon request, LICENSEE will complete and provide to LICENSOR any governmental form, receipt or document required in connection with payments made pursuant to this LICENSE. This would include but is not limited to proof of payment of withholding taxes or any form or certification required in order to reduce or eliminate any otherwise required withholding tax.

4.3 Inspection of Records.

(a)

Inspection. LICENSEE shall keep complete, accurate, and verifiable books and records at its principal place of business showing all transactions relating to the LICENSE herein granted. Such books and records shall include numerically sequenced invoices. LICENSOR or its duly authorized representatives shall have the right, upon no less than five (5) business days’ notice, and during normal business hours, to inspect LICENSEE’S books and records and all other documents and material in the possession of or under the control of LICENSEE in order to verify the accuracy of LICENSEE’S sales reports. LICENSOR shall have free and full access thereto for such purposes and shall be permitted to make copies thereof.

(b)

Discrepancy. In the event that any such inspection reveals an underpayment by LICENSEE, LICENSEE shall immediately remit payment to LICENSOR in the amount of the underpayment plus interest at the rate of one and one-half percent (1½%) per month (or the maximum rate allowed by law if lower) from the date such payment was due until the date when such payment is actually made; provided, however, that LICENSOR shall, in the absence of any intentional misconduct by LICENSEE, be entitled only to contest LICENSEE’S payments hereunder for the then-current Contract Period plus two (2) previous Contract Periods. Subject to the foregoing, once the deadline for contest with respect to a Contract Period has passed, LICENSEE’S payments for that time period may not be included in any contest by LICENSOR. In the ev ent that an audit subject to contest hereunder reveals an underpayment of more than 3% by LICENSEE of Earned Royalties, then LICENSEE shall bear all actual and reasonable outside expenses related to such inspection.

(c)

Maintenance After Expiration. For each Contract Period, all books and records relative to LICENSEE’S obligations hereunder shall be maintained and kept accessible and available to LICENSOR for inspection for at least three (3) years after the conclusion of that Contract Period.

(d)

Confidential Financial and Business Information. In the event that an investigation of LICENSEE’S books and records is made, certain confidential and proprietary business information of LICENSEE may necessarily be made available to the person or persons conducting such investigation. It is agreed that such confidential and proprietary information shall be retained in confidence by LICENSOR under the provisions of the confidentiality section of this LICENSE and shall not be disclosed to any third party without the prior express written permission of LICENSEE. It is understood and agreed,

however, that such information may be used in any proceeding arising out of LICENSEE’S obligations hereunder.

5. OWNERSHIP, GOODWILL AND PROTECTION OF RIGHTS

5.1

Acknowledgment. LICENSEE acknowledges LICENSOR’S exclusive right, title, and interest in and to the LICENSED MARKS, and shall not at any time during the Term of this LICENSE or thereafter do or permit to be done any act or thing which impairs the rights of LICENSOR with respect to such LICENSED MARKS. LICENSEE will never represent that it has any ownership in the LICENSED MARKS or in any registration of them and shall not attempt to register the LICENSED MARKS alone or as part of its own trademark or service mark in any jurisdiction. LICENSEE will use the LICENSED MARKS only in the manner specified by LICENSOR and this LICENSE. LICENSEE agrees that it will not, during the Term of this LICENSE, or thereafter, attack the validity or distinctiveness of the LICENSED MARKS. The Parties expressly intend and agree that all use of the LICENSED MARKS shall inure to the sole benefit of LICENSOR.

5.2

Confusingly Similar Marks. LICENSEE shall not, either during or after the Term of this LICENSE, use or authorize the use of any configuration, mark, name, design, logo or other designation confusingly similar to the LICENSED MARKS. Should LICENSEE, during the term of this LICENSE or at anytime thereafter, assert ownership in any insignia, mascot, designation, or trademark in any jurisdiction, which is the same as, or confusingly similar to, any of the LICENSED MARKS, LICENSEE will, upon request of LICENSOR, transfer or assign all right, title, and interest that it asserts in such insignia, mascot, designation, or trademark, including but not limited to any registrations, to the LICENSOR or its designee. To the best of LICENSOR’S knowledge, as of the Effective Date LICENSEE is not using configuration, trademark, service m ark, design, logo, trade name, symbol, brand, device, other designation, or combination, that is likely to cause confusion with respect to the goods or services of LICENSOR, or to cause mistake, or to deceive a reasonably prudent purchaser.

5.3

Registrations. LICENSEE agrees that it shall not, on the basis of its use of the LICENSED MARKS, oppose or seek to cancel in any court or state or federal agency, including, but not limited to, the United States Patent and Trademark Office. LICENSEE shall not initiate any legal actions based on the use of any material or artwork that includes the LICENSED MARKS, including, but not limited to, actions involving copyright infringement of any material containing LICENSED MARKS, without the prior express written consent of the LICENSOR. LICENSOR shall have the option to be consulted regarding such litigation at its sole discretion.

5.4

Modifications By LICENSEE. LICENSEE shall not, without prior express written permission from LICENSOR, develop or authorize the development of variations of the LICENSED MARKS or elements included within the LICENSED MARKS. In the event that LICENSOR grants such rights, any designs created shall be included in the LICENSED MARKS licensed hereunder, LICENSOR shall own all the rights in such new design, and LICENSEE shall execute any documents required to transfer such rights to LICENSOR. All uses and rights of and to the new designs shall inure to the exclusive benefit of LICENSOR and LICENSOR may register and protect the same in its own name, as it deems necessary or appropriate.

5.5

Goodwill. LICENSEE recognizes the value of the publicity and goodwill associated with the LICENSED MARKS, acknowledges that the LICENSED MARKS and any marks confusingly similar to the LICENSED MARKS have acquired secondary meaning, and that all related rights and goodwill belong exclusively to LICENSOR. LICENSEE agrees that it shall not conduct any activity or produce goods, which in any way question LICENSOR’S ethics or lawful practices, nor shall LICENSEE do anything that damages or reflects adversely upon LICENSOR, the LICENSED PRODUCTS, or the LICENSED MARKS.

6. LICENSED MARKS PROTECTION

6.1 Third Party Unauthorized Use of LICENSED MARKS

(a)

Notify LICENSOR. LICENSEE shall notify LICENSOR, in writing, of any manufacture, distribution, sale or advertisement of any product or service of the same general type or class as the LICENSED PRODUCTS that LICENSEE believes may constitute an infringement upon LICENSOR’S rights or LICENSEE’S authorized use of the LICENSED MARKS. LICENSEE shall not commence, prosecute or institute any action or proceeding against any person, firm or corporation alleging infringement, imitation or unauthorized use of the LICENSED MARKS without the prior written consent of LICENSOR.

(b)

Appropriate Action With Respect to Trademarks Other than GOODYEAR or GOODYEAR (and winged foot design). LICENSOR shall have the sole right to determine the appropriate action to be taken against any infringement, imitation or unauthorized use of these LICENSED MARKS, including whether to settle any claims or any controversy arising out of such claims. LICENSOR shall bear the expense of any actions and shall receive any settlements or damages.

(c)

Appropriate Action With Respect to the Trademarks GOODYEAR or GOODYEAR (and winged foot design). LICENSOR shall have the initial right to determine the appropriate action to be taken against any infringement, or any imitation or other use unauthorized by LICENSOR, of these LICENSED MARKS as to LICENSED PRODUCTS, including whether to settle any claims or any controversy arising out of such claims. LICENSOR acknowledges that, as a result of the license granted to LICENSEE, LICENSEE may sustain economic injury for any infringements of these LICENSED MARKS relating to the LICENSED PRODUCTS in the LICENSED TERRITORY. If LICENSOR fails to act within a reasonable period of time, LICENSEE may institute an action to enjoin such infringement and to recover damages. Actions with respect to GOODYEAR or GOODYEAR (and winged foot design) with respect to the LICENSED PRODUCTS in the LICENSED TERRITORY may be commenced by LICENSOR, LICENSEE, or by LICENSOR and LICENSEE jointly. Any and all profits, damages and/or settlements recovered in such action or proceeding shall be divided as follows: (1) each plaintiff will recover an equal percentage of its legal expenses up to one hundred percent (100%), (2) LICENSEE will recover its proven economic damages if they exceed the combined legal expenses, and (3) any additional money beyond (1) and (2) shall be divided equally between LICENSOR and LICENSEE.

6.2	Reasonable Assistance. LICENSEE agrees to provide LICENSOR with such reasonable assistance as LICENSOR may require in obtaining any protection of LICENSOR’S rights to the LICENSED MARKS at no expense to LICENSEE.

7. QUALITY CONTROL

7.1

New Products. LICENSEE must provide written notice to LICENSOR prior to the production of any new products which are to bear LICENSED MARKS. Any such products must also be added to the quarterly reports issued by LICENSEE. The parties agree that products currently made or sold by LICENSEE are not “new products” under this Section, and that for a Farm Tire to be a “new product” it must bear a new SKU designation (a mere redesignation of the SKU for an existing product does not, however, constitute the product a “new product” hereunder).

7.2

Quality Standards. LICENSEE warrants that the LICENSED PRODUCTS shall be made to reasonable commercial quality standards, and be of a quality equal to or higher than the samples provided to LICENSOR for review in accordance with this LICENSE. Moreover, the LICENSED PRODUCTS shall be manufactured according to LICENSEE’S approved standard quality control and manufacturing procedures and requirements, and shall meet (or exceed) all applicable government and industry standards, regulations, guidelines, rules, laws, and the like regarding such product(s). LICENSEE shall not offer for sale, advertise, promote, distribute, or use for any purpose any LICENSED PRODUCTS or packaging that are damaged, defective, seconds, or that otherwise fail to meet the specifications or quality requirements set forth in this LICENSE.

7.3	Product Sample Testing. If a question arises under Section 7.2, LICENSOR at its discretion may require LICENSEE to submit **. Upon reasonable request by LICENSOR, such testing shall be conducted throughout the Term and any renewal of this LICENSE.

7.4

Review of Marketing Materials Incorporating LICENSED MARKS. LICENSOR may request LICENSEE to provide samples of all packaging, promotional materials, and advertisements associated with the LICENSED PRODUCTS and any other materials containing, displaying, or used in conjunction with the LICENSED MARKS for LICENSOR’S inspection and approval. Such inspection shall be restricted solely to the use of the LICENSED MARKS.

7.5

Quality Maintenance/Inspection of Facilities. To ensure that the standards of quality reflected in the approved samples are being maintained, LICENSOR or its authorized representatives have the right to enter and inspect the facilities of LICENSEE during reasonable hours and upon two (2) Business Days’ notice during the Term of the LICENSE and during any sell-off period thereafter.

7.6

Substandard Quality. In the event that the quality of any of the LICENSED PRODUCTS falls below the level set forth in Section 7.2, LICENSEE shall, upon written notice from LICENSOR, immediately discontinue the production, sale, or distribution of such products or materials until such time as the products meet the standards in Section 7.2. In addition, a LICENSED PRODUCT will be deemed to have fallen below the requisite quality level if it is determined that **.

7.7	Disposal of Substandard Products. LICENSEE shall, upon LICENSOR’S direction, ship to LICENSOR, or destroy and certify such destruction of, all substandard LICENSED PRODUCTS.

Upon written approval from LICENSOR, LICENSEE may be authorized to dispose of such products at its own discretion as long as no use of or reference to the LICENSED MARKS is made in connection with the products. In such event, LICENSEE must completely remove all labels, tags and marks that would identify LICENSOR or the LICENSED MARKS and cut the beads on all tires to be scrapped.

7.8

Consumer Inquiries. LICENSEE shall, at its sole cost, establish and maintain procedures satisfactory to LICENSOR for the handling of all consumer complaints about quality or product warranty issues, relating to any of the LICENSED PRODUCTS (“Consumer Inquiries”). LICENSOR may forward to LICENSEE for handling any and all Consumer Inquiries that it receives. LICENSEE shall submit to LICENSOR a monthly report of all Consumer Inquiries and the manner in which they were handled.

8. USE OF OTHER MARKS WITH THE LICENSED MARKS

8.1

Use of Other Marks. After the Closing Date, LICENSEE may add the words “Made by Titan” to all molds bearing any of the LICENSED MARKS. LICENSEE shall not use any trademark, service mark, trade name, logo, symbol or devices in combination with the LICENSED MARKS without the prior written consent which consent can be withheld for any or no reason by LICENSOR, except for the use of “Made by Titan” and the use of “Titan” as part of LICENSEE’S corporate name in conjunction with the sale of LICENSED PRODUCTS. LICENSEE shall not attempt to obtain copyright or trademark in any artwork, which contains or is derived from the LICENSED MARKS without the prior written consent of LICENSOR which consent can be withheld for any or no reason. At LICENSOR’S request, LICENSEE shall remove from any LICENSED PRODUCT or associated materials bearing the LICENSED MARKS and under LICENSEE’S control or access, any element which LICENSOR believes will harm the LICENSED MARKS or LICENSOR’S reputation. LICENSEE shall not be required to remove any marks, or alter any LICENSED PRODUCTS or associated materials, if such goods or materials have previously been consented to by LICENSOR.

9. INDEMNIFICATION

9.1

Indemnification of LICENSOR. LICENSOR assumes no liability to LICENSEE or any third parties with respect to LICENSED PRODUCTS manufactured, sold, or distributed by LICENSEE. LICENSEE agrees to hold harmless, defend and indemnify LICENSOR and its officers, shareholders, employees and agents against third party claims, liabilities, demands, judgments or causes of action, and costs and expenses related thereto (including, but not limited to, reasonable attorney’s fees and costs), related to the LICENSED PRODUCTS or arising out of the manufacture, distribution, advertising, use, sale or marketing of the LICENSED PRODUCTS, and any breach of this LICENSE, including, but not limited to, unauthorized use of the LICENSED MARKS and infringement of any intellectual property rights except as otherwise stated below, provided that: (a) prompt written notice is given to LICENSEE of any such suit or claim; (b) LICENSEE shall have the option and right to undertake and conduct the defense of any such suits or claims brought against LICENSOR; and (c) no settlement of any suit or claim involving the LICENSED MARKS is made or entered into without the prior express written consent of LICENSEE.

9.2

Indemnification of LICENSEE. LICENSOR agrees to hold harmless, defend and indemnify LICENSEE, its officers, shareholders, employees and agents against third party claims, liabilities, demands, judgments, or causes of action and costs and expenses related thereto (including but not limited to reasonable attorneys’ fees and costs) of trademark, trade dress or copyright infringement, or unfair competition, or damages relating thereto, related to the use of the LICENSED MARKS that are registered in the identified LICENSED TERRITORY, on or in connection with the LICENSED PRODUCTS as expressly authorized by this LICENSE, and agrees to hold harmless, defend and indemnify LICENSEE or any third parties with respect to the performance characteristics of LICENSED PRODUCTS manufactured by LICENSOR or its Affiliates provided that: (a) prompt written notice is given to LICENSOR of any such suit or claim; (b) LICENSOR shall have the option and right to undertake and conduct the defense of any such suits or claims brought against LICENSEE; and (c) no settlement of any suit or claim involving the LICENSED MARKS is made or entered into without the prior express written consent of LICENSOR. This indemnification shall not apply to actions arising out of the use of LICENSED MARKS in territories where such LICENSED MARKS are not registered.

10. [RESERVED]

11. DISPUTE RESOLUTION

11.1

In the event of a dispute between or among the parties arising out of or in connection with this LICENSE, the parties to the dispute shall make every effort to resolve, promptly and in good faith, such dispute. In the event that the dispute cannot be resolved, a party may notify another party of the existence of a possible deadlock by sending a letter signed by management responsible for the operation of this Agreement to management of the other party. Within fifteen (15) business days after receipt of that notice, management of the parties shall arrange to meet at a mutually agreeable time and place, and thereafter as often as they reasonably deem necessary for a period of ninety (90) days from the date of that first meeting, to exchange relevant information and to attempt to resolve the dispute. In the event that responsible management have not been successful in resolving the dispute within ninety (90) days o f the receipt of the disputing party’s notice, either party may initiate an action or take such other action as is permitted under the LICENSE or any other ANCILLARY AGREEMENTS in accordance with the time periods set out elsewhere herein or therein. Except as set forth elsewhere in the ANCILLARY AGREEMENTS, each party shall be responsible for its own legal fees and expenses.

12. TERMINATION AND EXPIRATION

12.1	Expiration. Except as otherwise provided herein, this LICENSE shall expire in accordance with Section 2.

12.2

LICENSOR’S Right of Termination. Unless otherwise provided herein, LICENSOR shall have the right to terminate this Agreement immediately if LICENSEE materially breaches this Agreement and fails to cure such breach or to adopt a plan reasonably designed to cure such breach within sixty (60) days after receipt of notice. Material breach includes any of the following:

(a)

LICENSEE breaches Section 7.2 hereof; or

(b)

Any LICENSED PRODUCT is recalled for any reason and LICENSEE fails or refuses to correct the condition or defect which caused the recall; or

(c)

Except under federal bankruptcy laws, LICENSEE files a petition in bankruptcy, is adjudicated as bankrupt or insolvent, makes an assignment for the benefit of creditors or an arrangement pursuant to any bankruptcy law, discontinues all or a significant portion of its business, or its business is appointed a receiver; or

(d)

LICENSEE breaches its confidentiality obligations as provided in Section 14; or

(e)

LICENSEE sells LICENSED PRODUCTS outside the LICENSED TERRITORY except as allowed in Section 1.6 or otherwise by this Agreement, the Purchase Agreement, the Supply Agreement, or the Ancillary Agreements; or

(f)

LICENSEE ceases or threatens to cease, to carry on all or any material part of its business.

LICENSOR may also terminate this LICENSE immediately upon notice to LICENSEE in the event LICENSEE undergoes a CHANGE OF CONTROL, provided, however, that (i) LICENSEE shall notify LICENSOR in writing (a) promptly after it becomes aware of any CHANGE OF CONTROL described in Clause 2 of the definition of CHANGE OF CONTROL hereunder, or (b) not less than sixty (60) days prior to the proposed closing date with respect to any proposed CHANGE OF CONTROL other than a CHANGE OF CONTROL described in such Clause 2, and (ii) LICENSOR must exercise the termination right provided in this paragraph within 60 days after its receipt of the notice referred to in Clause (i)(b) of this sentence.

12.3

Commercialization by LICENSEE. LICENSEE agrees that during the Term of this LICENSE it will diligently distribute, promote, and sell the LICENSED PRODUCTS, and that it will make and maintain adequate arrangements for the distribution of the LICENSED PRODUCTS throughout the entire LICENSED TERRITORY. Any determination that LICENSEE has failed to diligently manufacture, distribute, promote, or sell any single LICENSED PRODUCT in any country within the LICENSED TERRITORY at any given time during the Term shall permit LICENSOR to terminate this LICENSE with respect to that LICENSED PRODUCT and/or LICENSED TERRITORY.

12.4

LICENSEE’S Right of Termination. LICENSEE shall have the right to terminate this LICENSE if LICENSOR materially breaches this LICENSE and fails to cure such breach, or to adopt a plan reasonably designed to cure such breach within sixty (60) days after receipt of such notice, and material breach includes:

(a)

Files a petition in bankruptcy, is adjudicated as bankrupt or insolvent, makes an assignment for the benefit of creditors or an arrangement pursuant to any bankruptcy law, discontinues all or a significant portion of its business, or its business is appointed a receiver, or

(b)

Materially breaches any of the conditions or provisions of this LICENSE, or

(c)

Breaches the confidentiality obligation as provided in Section 14.

12.5

Duties Upon Termination. Termination of the LICENSE shall be without prejudice to any rights that the terminating Party may otherwise have against the other Party. Upon termination by LICENSOR, all money owed including all unaccrued royalties, shall become immediately due and payable. Unless LICENSOR demonstrates that LICENSEE’S use of the LICENSED MARKS in connection with the LICENSED PRODUCTS will harm the reputation of LICENSOR, upon termination of this LICENSE, LICENSEE shall have a sell-off period of one (1) year for any LICENSED PRODUCTS manufactured prior to the effective date of termination. During such sell-off period LICENSEE shall be entitled to use the LICENSED MARKS as authorized by this Agreement in connection with the promotion, marketing, advertising, packaging, distribution, and sale of the LI CENSED PRODUCTS. LICENSEE may not sell molds, plates, dies, or the like, bearing LICENSED MARKS, to a third party absent the express written consent of LICENSOR. During the sell-off period, LICENSEE shall pay Earned Royalties on its sales of LICENSED PRODUCTS but there is no Minimum Guarantee owed to LICENSOR by LICENSEE during such period.

12.6

Duties Upon Expiration/Sell-off. Upon expiration of this LICENSE, LICENSEE shall discontinue all use of the LICENSED MARKS; provided, however, LICENSEE shall have one (1) year within which to dispose of any existing inventory of the LICENSED PRODUCTS. Thereafter, LICENSEE shall promptly discontinue the sale or distribution of the LICENSED PRODUCTS and shall destroy or ship to LICENSOR all existing inventory of LICENSED PRODUCTS. LICENSEE may not sell molds, plates, dies, or the like, bearing LICENSED MARKS, to a third party absent the express written consent of LICENSOR. Sales under this Paragraph shall require the payment of Earned Royalties as provided above, as well as compliance with all other provisions of this LICENSE, provided that the Minimum Guarantee shall not apply. In the event LICENSEE elects to sell LI CENSED PRODUCTS under this Paragraph at a price lower than LICENSEE’S “normal selling price” of the LICENSED PRODUCTS (as determined by LICENSEE’S prior course of business), the gross sales for calculating NET SALES shall be the higher of actual gross invoice price or seventy-five percent (75%) of the value of the LICENSED PRODUCTS as if sold at their “normal selling price”. LICENSEE’S right to sell off pursuant to this paragraph is subject to the condition that, within thirty (30) days after expiration, LICENSEE will (a) pay to LICENSOR all Earned Royalties and/or Minimum Guarantees accrued or due at the time of expiration as soon as such Earned Royalties can be computed; (b) deliver to LICENSOR a report of sales up to the time of expiration; and (c) provide LICENSOR with an inventory of unsold LICENS ED PRODUCTS and allow LICENSOR at its option to conduct a physical inventory to verify the statement.

12.7

Disposition of Molds Upon Expiration or Termination; Related Matters. LICENSEE will destroy all molds containing the LICENSED MARKS or remove such marks from the molds, and shall destroy or remove such marks from all goods in progress, designs, plates, dies, screens, and advertising/promotional materials, within ninety (90) days after expiration or termination. An officer of LICENSEE must certify such change or destruction in writing to the address provided for notices to LICENSOR.

12.8

Bankruptcy/Sale of LICENSOR. If LICENSOR shall be subject to a voluntary or involuntary petition for bankruptcy, and if the trustee rejects this LICENSE as an executory contract, LICENSEE may elect (a) to treat this LICENSE as terminated by such rejection if such rejection by the trustee amounts to such a breach as would entitle LICENSEE to treat such contract as

terminated by virtue of its own terms, applicable nonbankruptcy law, or an agreement made by LICENSEE with another entity; or (b) to retain its rights (but excluding any right under applicable nonbankruptcy law to specific performance of such contract) under this LICENSE as such rights existed immediately before the case commenced, for the duration of the Term, including any Renewal Term, in accordance with this LICENSE. LICENSEE’S rights under this LICENSE shall not be affected by any change of ownership of LICENSOR.

12.9

Termination of Supply Obligation. Unless the parties hereto otherwise agree, upon termination or expiration of this LICENSE for any reason, LICENSEE shall have no obligation to supply tires to LICENSOR under the Supply Agreement or under, except in respect of the Offtake Agreement, any other agreement between the parties related to the Purchase Agreement, and LICENSEE shall have no Minimum Guarantee payment obligation; provided, that, in such event, the parties hereto shall use all reasonable efforts, acting in good faith, to agree as quickly as practicable upon alternative arrangements for the supply by Titan of tires (a) theretofore subject to supply by Titan under such agreements and (b) required to be sold or delivered by GOODYEAR under any federal or state government contract to which GOODYEAR is a party.

13. INJUNCTIVE RELIEF

13.1

Injunctive Relief. It is expressly agreed that LICENSOR would suffer irreparable harm from a breach by LICENSEE of any of its covenants contained in this LICENSE, and that remedies other than injunctive relief cannot fully compensate or adequately protect LICENSOR for such a violation. Therefore, without limiting the right of LICENSOR to pursue all other legal and equitable remedies available for violation of this LICENSE, in the event of actual or threatened breach by LICENSEE of any of the provisions of this LICENSE, LICENSEE consents that LICENSOR shall be entitled to injunctive or other relief in order to enforce or prevent any such violation or continuing violation thereof without necessity of posting bond or other security, any requirements therefore being expressly waived by LICENSEE. LICENSEE agrees not to raise the defense of an adequate remedy at law in any such proceeding. LICENSEE acknowledges and agrees that the provisions of this paragraph are reasonably necessary and commensurate with the need to protect LICENSOR against irreparable harm and to protect its legitimate and proprietary business interests and property.

14. CONFIDENTIALITY

14.1	It is anticipated that LICENSOR and LICENSEE will obtain or have obtained information about the other party’s business and/or technology and/or marks, logos or commercial symbols that the other party considers confidential.

14.2

During and for a period of ten (10) years following the expiration or termination of this LICENSE, LICENSOR and LICENSEE agree not to disclose to others the subject matter of this LICENSE or any information furnished by the other party, which may include, without limitation, marketing and financial information, trade secrets, know how, drawings, designs, data, copyrights, inventions, processes, procedures, formulas, specifications, and the like (“Confidential Information”) without written prior approval of the other party, which approval may be withheld for any reason or for no reason.

14.3

Each of the parties shall exercise care to prevent the disclosure of Confidential Information to any third party, using the same standard of care which it employs with its own confidential information of similar character. The parties also shall limit internal dissemination of Confidential Information within their own organization in strict conformity with each party’s established internal policies and procedures regarding the protection of confidential information. Each party further agrees that it shall be liable to the other party for unauthorized disclosures or use of Confidential Information of the other party by any of its employees; provided, however, that the parties shall not be liable to one another for disclosures on use of Confidential Information of the other party by an employee of a party who makes such disclosure or engages in such use more than ten (10) years after th e employee terminates his or her employment with such party.

14.4	LICENSOR and LICENSEE shall exercise care to prevent the disclosure of Confidential Information to any third party, using the same standard of care which it employs with its own confidential information of similar character.

14.5 Confidential Information does not include information that:

(i)

recipient’s files and records establish as having been in its possession in significant detail at the time the information was received; or

(ii)

is publicly available in significant detail at the time it is disclosed to recipient by discloser or which later becomes so available other than as a result of recipients’ action or inaction; or

(iii)

becomes known to recipient from a third party who has the right to disclose such information without breach of an actual or implied obligation of trust or confidence to the discloser or any other party; or

(iv)

becomes known to recipient from a third party that had the lawful right to disclose such information; or

(v)

is disclosed by recipient with the other party’s prior written approval; or

(vi)

is required to be disclosed by a court of law or requested by a regulatory agency; provided that the party subject to the requirement of disclosure complies with Section 14.6.

14.6

If a party believes that it is legally required to disclose any Confidential Information, that party (the “Initial Party”) will promptly notify the other party. Unless the other party within 10 days of receipt of that notice gives notice to the Initial Party that the other party intends to seek a protective order or act in some other way to prevent disclosure of the information in question, the Initial Party may disclose the information without a violation of this LICENSE. After giving the notice referred to in the preceding sentence, the other party must act promptly to contest the obligation of disclosure, notify the Initial Party of its actions and give the Initial Party notice if it does not successfully contest the obligation of disclosure in time to permit the Initial Party to disclose the information without violation of law or contempt of any Governmental Authority. ; If

compelled to disclose any Confidential Information, the Initial Party will disclose only such Confidential Information as to which disclosure is required and will use all commercially reasonable efforts to ensure that the Confidential Information required to be disclosed is accorded confidential treatment by the person, entity or Governmental Authority to whom or to which such Confidential Information is disclosed.

15. WARRANTIES

15.1

LICENSOR’S Warranty. LICENSOR represents and warrants that it has the full right, power, and authority to enter into and perform this LICENSE, that it is not a party to any agreement or understanding which would conflict with this LICENSE, and that it owns, controls, or has previously been granted the necessary rights in and to the LICENSED MARKS which enable LICENSOR to grant to LICENSEE the rights granted herein. LICENSOR further represents that, as of Closing, it is not aware of any infringements of the LICENSED MARKS in North America and that, to the best of its knowledge, information, and belief, the LICENSED MARKS are noninfringing. LICENSOR (a) makes no other representation or warranty, express or implied, (b) assu mes no liability with respect to any infringement of any patent or other right of third parties due to LICENSEE’S activities under the license granted hereby and (c) assumes no liability with regard to any claim, specious or otherwise, arising out of alleged side effects or any other alleged performance defect arising out of the use or misuse of the LICENSED PRODUCTS.

15.2

LICENSEE’S Warranty. LICENSEE warrants and represents that it is authorized to enter into this LICENSE and that there is no existing agreement with any third party that prevents it or restrains its ability to comply with its obligations under this LICENSE. LICENSEE further warrants and represents that it owns or has acquired all rights, title and interest to any design or tread design that it claims can be used on any LICENSED PRODUCTS; that it has acquired any necessary authorization, license, or permission from any third party(ies) to manufacture, promote, market, distribute, and/or sell LICENSED PRODUCTS. LICENSEE shall not disclaim any warranty whether contained herein or arising by operation of law, and any attempted disclaimer shall be deemed null an d void.

15.3

Brokers. Each Party hereby represents and warrants to the other that it has not employed or dealt with any broker or finder in connection with this LICENSE or the transactions contemplated hereby and agrees to indemnify the other Party and hold them harmless from any and all liability including, without limitation, reasonable attorney’s fees (including without limitation, the costs of LICENSOR’S inside counsel and other personnel calculated at market billing rates) and disbursements paid or incurred in connection with any such liability for any claimed brokerage commissions or finders’ fees in connection with this LICENSE or the transactions contemplated hereby.

16. NOTICE

16.1

Notices. All notices, and other communications which may or are required to be given or made by either Party to the other in connection with this LICENSE shall, except as otherwise set forth herein, be in writing (including telex, fax or other similar writing) and shall be deemed to have been duly given or made: (a) if sent by registered or certified mail, three (3) days after the posting thereof with first class postage attached; (b) if sent by hand or overnight delivery, upon the

delivery thereof; and (c) if sent by telex or fax, upon confirmation of receipt of such telex or fax, in each case addressed to the respective Parties as follows:

If to LICENSOR:

The Goodyear Tire & Rubber Company

1144 East Market Street

Akron, Ohio 44316-0001

Phone: (330) 796-1818

Fax: (330) 796-8836

Attention: Corporate Secretary

If to LICENSEE:

Maurice M. Taylor, Jr.

Titan Tire Corporation

2701 Spruce Street

Quincy, IL 62301

Fax: (217)228-3166

with a copy to:

Cheri T. Holley

General Counsel

Titan International, Inc.

2701 Spruce Street

Quincy, IL 62301

Fax: (217) 228-3040

with second copy to:

Robert J. Diehl, Jr.

Bodman LLP

100 Renaissance Center, 34th Floor

Detroit, MI 48243

(313) 393-7579

or to such other address and to the attention of such other persons as may be designated from time to time by such other Party hereto by notice given in the manner provided in this Section 16.1.

17. RELATIONSHIP OF THE PARTIES

17.1

Independent Contractors. LICENSEE shall not state or imply, directly or indirectly, that LICENSEE or its activities, other than those provided herein, are supported, endorsed or sponsored by LICENSOR. It is understood that the relationship between the Parties shall be that of independent contractors, that neither Party shall have any right or power to obligate, bind, or commit the other to any expense, liability, or matter other than as expressly provided and

authorized in this LICENSE, and that the officers, employees, and agents or other representatives of one Party shall not be deemed expressly or impliedly the employees, partners, joint ventures or agents of the other.

18. MISCELLANEOUS

18.1	Counterparts. This LICENSE may be executed contemporaneously in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

18.2	Election of Remedies. The remedies provided herein are not exclusive of any other lawful remedies that may be available, and a Party’s election of a remedy shall not constitute an exclusive election of remedies.

18.3

Force Majeure. Neither Party shall be deemed in default or otherwise liable hereunder due to its inability to perform by reason of any fire, earthquake, flood, epidemic, accident, explosion, casualty, strike, lockout, labor controversy, riot, civil disturbance, act of public enemy, embargo, war, act of God, act of terrorism, or any municipal, county, state, national or international ordinance or law or any executive, administrative, judicial or similar order (which order is not the result of any act or omission to act which would constitute a default under this LICENSE), or any failure or delay of any transportation, power, or other essential thing required, or similar causes beyond the Party’s control (“force majeure”). Any delay in performance shall be no greater than the event of force majeure causing the delay. If a n event of force majeure continues uninterrupted for a period exceeding six (6) calendar months, either Party may elect to terminate this LICENSE upon notice to the other, but such right of termination, if not exercised, shall expire immediately upon the discontinuance of the event of force majeure. In such case, the Party affected by the force majeure shall notify the other Party of its inability to perform. Notwithstanding anything to the contrary in this Section, the exercise of such right of termination shall not affect LICENSEE’S obligation to pay the Minimum Guarantee or Earned Royalties for NET SALES which accrued prior to and including the termination date of this LICENSE.

18.4

Forum/Governing Law. This LICENSE shall be governed by and construed in accordance with the laws of the State of Ohio without regard to its conflict of law provisions. The Parties agree that a federal or state court with general jurisdiction in the county in which LICENSOR’S home office is located shall be the exclusive forum for the resolution of any dispute arising from or relating to this LICENSE. Each Party hereby consents to the jurisdiction and venue of any such federal or state court.

18.5

Further Assurances and Cooperation. Each Party agrees to execute and deliver to the other Party such other instruments, documents, and statements, including without limitation, instruments and documents of recordation, assignment, transfer, conveyance, and clarification and take such other action as may be reasonably necessary or convenient in the discretion of the requesting Party to carry out more effectively the purposes of this LICENSE. Unless otherwise provided, no consent or approval provided for in this LICENSE may be unreasonably withheld or delayed.

18.6

Interpretation and Construction. The word “or” shall be interpreted to have both its conjunctive and disjunctive meaning whenever possible. The paragraph titles are intended solely for convenience and shall not affect the construction or interpretation of any of the provisions of this LICENSE. No provision of this LICENSE shall be construed in favor of or against any Party on

the ground that such Party or its counsel drafted the provision. The language used herein, unless defined specifically, shall be construed according to its reasonable and customary meaning in the United States. Terms of art used in this LICENSE which are not defined herein shall be defined as commonly understood in the United States licensing industry for similar products. In the event of a breach, this LICENSE may be specifically enforced. This LICENSE shall at all times be construed so as to carry out its stated purposes.

18.7

Integration. This LICENSE, the Purchase Agreement and the Ancillary Agreements and any attached schedules and exhibits, constitutes the entire agreement between the Parties pertaining to the subject matter contained herein and supersede all prior and contemporaneous agreements, representations, and understandings of the Parties. Each of the Parties acknowledges that no other party, nor any agent or attorney of any other party, has made any promise, representation, or warranty whatsoever, express or implied, and not contained herein, concerning the subject matter hereof to induce the Party to execute or authorize the execution of this LICENSE, and acknowledges that the Party has not executed or authorized the execution of this instrument in reliance upon any such promise, representation, or warranty not contained herein. No supplement, modification, or amendment of this LICENSE shall be binding unless executed in writing and signed by both Parties.

18.8

Severability. If any term or other provision of this LICENSE is invalid, illegal or incapable of being enforced under any rule of law or public policy, all other conditions and provisions of this LICENSE shall nevertheless remain in full force and effect, so long as the economic and legal substance of the transactions contemplated hereby are not affected in a manner materially adverse to either party. Upon any determination that any such term or other provision is invalid, illegal or incapable of being enforced, the Parties hereto shall negotiate in good faith to modify this LICENSE so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.

18.9	Survival of Rights and Obligations. Termination or expiration of this LICENSE shall not impair any rights of LICENSOR or obligations of LICENSEE, including but not limited to payments, statements of account, compliance review, disposition of inventory, and indemnification.

18.10

Waiver. No waiver of any of the provisions of this LICENSE shall be valid unless in writing signed by the Party against which the waiver is sought to be enforced. No waiver by either Party of any breach of or failure of performance shall be deemed a waiver as to any subsequent breach or failure of performance, whether or not similar, nor shall any waiver constitute a continuing waiver. Failure of LICENSOR to enforce any provision or to exercise any right or remedy shall not constitute a waiver of any of LICENSOR’S rights or LICENSEE’S obligations.

IN WITNESS WHEREOF, the following signatures represent that the Parties have read this LICENSE in its entirety, including the incorporated and attached Exhibits and Schedules, and by their execution below have agreed to all its terms and conditions.

LICENSOR: THE GOODYEAR TIRE & RUBBER COMPANY	LICENSEE: TITAN TIRE CORPORATION
By: /s/ THE GOODYEAR TIRE & RUBBER COMPANY	By: /s/ TITAN TIRE CORPORATION

EXHIBIT I

SALES AND ROYALTY REPORT FORM

SCHEDULE A

SCHEDULE B

LICENSED PROPERTY/TRADEMARKS

SCHEDULE C

LICENSED PRODUCTS

EXHIBIT X

DEDUCTIONS TO REACH NET SALES

EX-10.2 3 ex10_2.htm SUPPLY AGREEMENT WITH DEERE & COMPANY - AUGUST 2006 ex10_2.htm

Exhibit 10.2

SUPPLY AGREEMENT

This Supply Agreement (“Agreement”) is effective as of August 17, 2006 (“Effective Date”) and is entered between Titan Tire Corporation, an Illinois corporation with its principal place of business in Des Moines, Iowa ("Titan") and Deere & Company, a Delaware corporation, with its principal place of business in Moline, Illinois (“Deere”), acting through its affiliate and business unit: John Deere Construction & Forestry Equipment Company Unit: John Deere Dubuque Works, 18600 South John Deere Road, Dubuque, IA 52001-9757 and Business Unit: John Deere Davenport Works, P.O. Box 4198, Davenport, IA 52808-4198.

The above listed business units are individually a “Deere Affiliate” and collectively the “Deere Affiliate.” The terms of this Agreement shall apply to the purchase of Products by any Deere Affiliate unless the Deere Affiliate and Titan agree otherwise. The purchase order will act as a signature of the Deere Affiliate accepting the terms of this Agreement. Deere shall retain the primary responsibility for administering this Agreement.

By mutual agreement of Deere and Titan, this section may be amended to include other affiliated corporations and business units of Deere.

WHEREAS, Deere wishes to purchase certain Products, as hereinafter defined, manufactured by Titan which will then be incorporated into wholegoods equipment or sold as replacement parts by Deere and its dealers.

WHEREAS, Titan wants to sell Deere the Products that Titan manufactures.

NOW THEREFORE, the parties agree as follows:

1. PRODUCTS - As used herein, the term "Products" shall mean those tires and parts listed on Attachment 1, attached hereto and incorporated herein by reference and to any other products which may be added to Attachment 1 by Deere and Titan from time to time by mutual agreement.

2. PURCHASES - Titan agrees to sell to Deere and Deere agrees to buy from Titan, **. Deere will release orders to Titan.

3. TERM - This agreement will commence as of the Effective Date and will continue for five years from the date of signing, contingent upon satisfactory performance of contractual terms and conditions by Titan and subject to the provisions of Section 21. This agreement may be extended for a mutually agreeable period of time by written agreement of both parties; provided that both parties advise one another in writing six months prior to the expiration extended period. The terms and conditions of this agreement would apply to any extension or renewal.

4. FORECASTS AND ORDERS - Purchases under this Agreement shall be made against specific written purchase orders submitted by Deere to Titan from time to time during the term of this Agreement. Any forecast for products provided by Deere shall not be considered orders for Products, shall be used by Titan for general corporate planning purposes only, and may be disregarded by without prior notice to Titan. Forecast orders do not constitute a contractual obligation on Titan or Deere’s part unless the parties have agreed otherwise in writing. ** Deere will deliver to Titan order s for Products on order formats utilized by Deere which will specify the quantity of each Products ordered and the date by which the product must be provided to said Deere facility. The order shall constitute a binding commitment by Deere to purchase the Products specified therein on the terms and conditions herein. **

5. DELIVERY - Titan shall deliver the Products ordered to the designated Deere facility, or its designee on the delivery date set forth in the order. Time is of the essence in delivering Product. If a Product will not be delivered on or before the delivery date specified in the order, Titan must immediately notify the applicable Deere facility that it will not be delivered in a timely manner.

6. FREIGHT - The Products shall be shipped FOB Titan facilities to designated Deere location and on a carrier designated by Deere. Deere will be liable for all such transportation expenses. In the event that a late delivery if Titan’s responsibility, Titan may be liable for expedited freight premiums incurred to meet Deere factory production schedules.

7. PACKAGING - Titan shall package the Products so that the Products will not be damaged or destroyed in transit. As to each Product shipment, Titan must include a packing list specifying the Product number(s), the quantity of each Product, the order number, release number, and/or blanket purchase order number, if applicable, and any other information Deere requires.

8. PRICING - During the term of this Agreement, the price of these products shall be the applicable price set forth in Attachment I, except as otherwise provided herein. **

9. PAYMENT - Invoices will be delivered by Titan to the Deere facility involved, Attention: Accounts Payable or such other address designated by Deere. This invoice will reference the order number, release number, Product number(s), quantity of each Product, proper price for each Product, total price and any other information requested by Deere. Payment terms are net thirty (30) days.

10. QUALITY/DEFECTS - If any Product or Other Product sold to Deere is defective in material or workmanship, or does not conform to Deere’s specifications/quality requirements, Titan agrees, at its sole cost, to repair or replace the defective Product or Other Product.

11. PRODUCT INDEMNITY - Titan agrees to defend, hold harmless and indemnify Deere, its subsidiaries and affiliates, their officers, directors, employees and agents from and against any and all claims or suits, including costs and attorneys' fees arising from any act or omission of Titan relating to defective material or workmanship. Titan's obligation hereunder shall not extend to claims whereby the Products acquired by Deere from Titan were modified or altered or misused by Deere, its subsidiaries and affiliates, their officers, directors, employees or agents or if the Product was primarily designed by Deere and to the extent that said modification or design or misuse caused the loss or damage. Titan's obligation hereunder shall not extend to any claims other than those

expressly stated.

12. ENTIRE AGREEMENT - The terms of this agreement will supersede any conflicting or inconsistent terms contained in orders or attachments to this agreement and the terms and conditions of this agreement shall apply to all such orders placed by Deere.

13. AMENDMENTS - This agreement may be amended only by a written document signed by the parties which states that it is intended to amend this agreement.

14. SEVERABILITY - The invalidity or unenforceability of any term of this agreement shall not affect the validity and enforceability of this agreement or any of its other terms, and this agreement and such other terms shall be construed as though the invalid or unenforceable term(s) were not included herein.

15. ASSIGNMENT - Neither party shall assign any rights, delegate any duties or subcontract any work under this Agreement without the other party’s prior written consent and any attempt to do so is void and has no effect. No assignment shall relieve the assigning party of its obligations under this Agreement.

16. BINDING EFFECT - This Agreement will be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

17. NOTICES - All notices required to be given to a party under this Agreement are to be delivered to the following addresses, or any other addresses designated by the parties by notices delivered in accordance with this section: If to Titan: Titan Tire Corporation, 2345 E. Market Street, Des Moines, IA 50317 and if to Deere: Deere & Company, 3400 80th Street, Moline, Illinois 61265 Attn: President of the Construction & Forestry Equipment. Any notice required of permitted under this Agreement is to be given in writing and is deemed effect ively given: (a) upon personal delivery to the party to be notified; (b) upon confirmation of receipt by fax by the party to be notified; or, (c) deposit with a reputable overnight courier, prepaid for overnight delivery addressed as set forth in this section and upon confirmation of delivery by said courier.

18. LAW - This agreement shall be governed by and construed in accordance with the internal law of the State of Illinois.

19. FORCE MAJEURE - Neither party shall be responsible to the other party for any delay in or failure of performance of its obligations under this agreement to the extent attributable to causes beyond its reasonable control, including but not limited to, acts of God, fires, floods, strikes, acts of any government or delays by carriers, provided that the party affected thereby gives the other parties prompt notice of the occurrence of any event which is likely to cause any such delay or failure and of its best estimate of the length of any delay and possibility that it will be unable to resume performance; and provided furth er that said affected party shall use its best efforts to expeditiously overcome the effects of the event and to resume performance.

20. DEFAULT PROVISIONS - If during this agreement, Titan's quality deteriorates significantly Deere may find Titan in default and give notice to cure as discussed below. If after the

notice Titan has not responded within 60 days, then Deere may terminate its purchase obligations in whole or in part without further liability. Under this provision, Deere would be required to provide written notice to Titan sixty (60) days within the default outlining said default and its causes for termination. If during that sixty (60) day period, Titan addresses Deere’s default to Deere’s satisfaction, there will be no default. If during this agreement, Deere does not make its payments according to the terms of this Agreement, Titan may find Deere in default and terminate its obligations in whole or in part without further liability. The failure of a party at any time to require performance by another party in no way affects its right to require such perf ormance at any time thereafter. In addition, no waiver by any parts of the breach of any provision hereof shall constitute a waiver of any subsequent breach of the same provision, or any breach of any other provision.

21. REMEDIES CUMULATIVE - Each of the rights and remedies of the parties set forth in this agreement shall be cumulative with all other such rights and remedies, as well as with all rights and remedies of the parties otherwise available at law or in equity.

IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be duly executed by duly authorized representatives the day, month and year first above written.

TITAN TIRE CORPORATION	DEERE & COMPANY

/s/ TITAN TIRE CORPORATION	/s/ DEERE & COMPANY

ATTACHMENT I

ATTACHMENT II

EX-10.3 4 ex10_3.htm SUPPLY AGREEMENT WITH DEERE & COMPANY - APRIL 2008 ex10_3.htm

Exhibit 10.3

SUPPLY AGREEMENT- 16 April 2008

This Supply Agreement (“Agreement”) is effective as of April 15, 2008 (“Effective Date”) and is entered between Titan Tire Corporation, an Illinois corporation with its principal place of business in Des Moines, Iowa (“Titan”) and Deere & Company, a Delaware corporation, with its principal place of business in Moline, Illinois (“Deere”), 3400 80th Street, Moline, Illinois 61265, acting through its affiliates and business units: John Deere Waterloo Works, 3500 East Donald Street, Waterloo, Iowa; John Deere Harvester Works, 1100 13th Avenue, East Moline, Illinois; Industrias John Deere S.A. de C.V., Bl vd Diaz Ordaz #500, Garza Garcia, Nuevo Leon, Mexico; John Deere Ottumwa Works, 928 E. Vine Street; Ottumwa, Iowa; John Deere Seeding Works, 501 River Drive, Moline, Illinois; John Deere Commercial Products (Augusta), 700 Horizon South Parkway, Grovetown, Georgia; John Deere Valley City Works, 1725 7th Street SE, Valley City, North Dakota; John Deere Thibodaux, 244 Highway 3266, Thibodaux, Louisiana; and John Deere Des Moines Work, 825 SW Irvinedale Drive, Ankeny, Iowa.

The above listed business units are individually a “Deere Affiliate” and collectively the “Deere Affiliate.” The terms of this Agreement shall apply to the purchase of products by any Deere Affiliate unless the Deere Affiliate and Titan agree otherwise, or unless a separate agreement exists between the Deere Affiliate and Titan. The purchase order will act as a signature of the Deere Affiliate accepting the terms of this Agreement. Deere shall retain the primary responsibility for administering this Agreement.

By mutual agreement of Deere and Titan, this section may be amended to include other affiliated corporations and business units of Deere.

WHEREAS, Titan wants to sell Deere the Products that Titan manufactures;

NOW THEREFORE, the parties agree as follows:

1.	PRODUCTS – As used herein, the term “products” shall mean those tires and parts listed on Attachment I, attached hereto and incorporated herein by reference and to any other products which may be added to Attachment 1 by Deere and Titan from time to time by mutual agreement.

PURCHASES

**. To help with Titan capacity planning, Deere agrees to meet monthly and review ** to meet the overall intent.

TERM – This agreement will commence as of the Effective Date and will continue through April 30, 2011, contingent upon satisfactory performance of contractual terms and conditions by Titan and subject to the provisions of Section 21. This agreement may be extended for a mutually agreeable period of time by written agreement of both parties; provided that both parties advise one another in writing six months prior to the expiration extended period. The terms and conditions of this agreement would apply to any extension or renewal.

FORECASTS AND ORDERS – Purchases under this Agreement shall be made against specific written purchase orders submitted by Deere to Titan from time to time during the term of this Agreement. Any forecast for products provided by Deere shall not be considered orders for Products, shall be used by Titan for general corporate planning purposes only, and may be disregarded by without prior notice to Titan. Forecast orders do not constitute a contractual obligation on Titan or Deere’s part unless the parties have agreed otherwise in writing. ** Deere will deliver to Titan orders for Products on order formats utilized by Deere which will specify the quantity of each Product ordered and the date by which the Product must be provided to said Deere facility. The order shall constitute a binding commitment by Deere to purchase the Products specified therein on the terms and conditions herein.

DELIVERY – Titan shall deliver the Products ordered to the designated Deere facility, or its designee on the delivery date set forth in the order. Time is of the essence in delivered Product. If a Product will not be delivered on or before the delivery date specified in the order, Titan must immediately notify the applicable Deere facility that it will not be delivered in a timely manner.

FREIGHT – The Products shall be shipped FOB Titan facilities to designated Deere location and on a carrier designated by Deere. Deere will be liable for all such transportation expenses. In the event that a late delivery is Titan’s responsibility, Titan may be liable for expedited freight premiums incurred to meet Deere factory production schedules.

PACKAGING – Titan shall package the Products so that the Products will not be damaged or destroyed in transit. As to each Product shipment, Titan must include a packing list specifying the Product number(s), the quantity of each Product, the order number, release number, and/or blanket purchase order number, if applicable, and any other information Deere requires.

8.	PRICING – During the term of this Agreement, the price of these products shall be the applicable price set forth in Attachment I, except as otherwise provided herein. **

9.	PAYMENT – Titan will deliver invoices to the Deere facility involved, labeled: Attention: Accounts Payable or such other address designated by Deere. The invoice will reference the order number, release number, Product number(s),

quantity of each Product, proper price for each Product, total price and any other information requested by Deere. Payment terms are net thirty (30) days.

10.	QUALITY/DEFECTS – If any Product sold to Deere is defective in material or workmanship, or does not conform to Deere’s specifications/quality requirements, Titan agrees, at its sole cost, to repair or replace the defective Product.

11.

PRODUCT INDEMNITY – Titan agrees to defend, hold harmless and indemnify Deere, its subsidiaries and affiliates, their officers, directors, employees and agents from and against any and all claims, actions, or suits, including costs, expenses, and reasonable attorney fees caused by or arising from any act or omission of Titan relating to design, defective material, or workmanship. Titan’s obligation hereunder shall not extend to claims whereby the Products acquired by Deere from Titan were modified or altered or misused by Deere, its subsidiaries and affiliates, their officers, directors, employees or agents. Titan’s obligation hereunder shall not extend to any claims other than those expressly stated.

12.	ENTIRE AGREEMENT – The terms of this agreement will supersede any conflicting or inconsistent terms contained in orders or attachments to this agreement and the terms and conditions of this agreement shall apply to all such orders placed by Deere.

13.	AMENDENTS – This agreement may be amended only by a written document signed by the parties which states that it is intended to amend this agreement.

14.

SEVERABILITY – The invalidity or unenforceability of any term of this agreement shall not affect the validity and enforceability of this agreement or any of its other terms, and this agreement and such other terms shall be construed as though the invalid or unenforceable terms(s) were not included herein.

15.

ASSIGNMENT – Neither party shall assign any rights, delegate any duties or subcontract any work under this Agreement without the other party’s prior written consent and any attempt to do so is void and has no effect. No assignment shall relieve the assigning party of its obligations under this agreement.

16.	BINDING EFFECT – This Agreement will be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

17.

NOTICES – All notices required to be given to a party under this Agreement are to be delivered to the following addresses, or any other addresses designated by the parties by notices delivered in accordance with this section: If to Titan: Titan Tire Corporation, 2345 E. Market Street, Des Moines, IA 50317 and if to Deere: Deere & Company, 3400 80th Street, Moline, Illinois 61265, Attn: Vice President, Supply Management.

Any notice required or permitted under this Agreement is to be given in writing and is deemed effectively given: (a) upon personal delivery to the party to be notified; (b) upon confirmation of receipt by fax by the party to be notified; or, (c) deposit with a reputable overnight courier, prepaid for overnight delivery addressed as set forth in this section and upon confirmation of delivery by said courier.

18.	LAW – This agreement shall be governed by and construed in accordance with the internal law of the State of Illinois.

19.

FORCE MAJEURE – Neither party shall be responsible to the other party for any delay in or failure of performance of its obligations under this agreement to the extent attributable to causes beyond its reasonable control, including but not limited to, acts of God, fires, floods, strikes, acts of any government or delays by carriers, provided that the party affected thereby gives the other parties prompt notice of the occurrence of any event which is likely to cause any such delay or failure and of its best estimate of the length of any delay and possibility that it will be unable to resume performance; and provided further that said affected party shall use its best efforts to expeditiously overcome the effects of the event and to resume performance.

20.	TERMINATION.

20.1

Termination for Default by Either Party. At any time during the term of this Agreement, should either party default in performing any of its material obligations hereunder, the other party may give written notice of default specifying the details thereof. If within 60 days (60) days of the receipt of such notice the defaulting party fails to cure the default, the non-defaulting party shall have the right to terminate this Agreement with regard to the particular Product materially affected by the default, or if the default materially affects all Products, the non-defaulting party shall have the right to terminate this Agreement in its entirety. The non-defaulting party shall give the defaulting party thirty (30) days written notice from the determination of t he failure to cure the default, whereupon the termination shall be effective.

20.2

Termination for Default by Titan. Notwithstanding the foregoing, if during the term of this Agreement, Titan’s quality performance and/or delivery performances significantly deteriorates, Deere may find Titan in default and give written notice of such default, outlining the default and the basis for Deere’s termination. If within 60 days after such notice from Deere (the “Cure Period”), Titan has not responded to Deere’s notice of default, Deere may terminate its purchase obligations under this Agreement in whole or in part without further liability. If during the Cure Period, Titan addresses Deere’s claims of Titan’s default to Deere’s satisfaction, Titan will not be found to be in default under this provision . Conversely, if during the Cure Period, Titan addresses Deere’s claims of Titan’s default under this provision and said response is unsatisfactory to Deere, Deere reserves the right to terminate its purchase obligations under this Agreement in whole or in part

without further liability. If during this Agreement, Deere does not make its payments according to the terms of this Agreement, Titan may find Deere in default and terminate is obligation in whole or in part without further liability. The failure of a party at any time to require performance by another party in no way affects its right to require such performance at any time thereafter. In addition, no waiver by any parts of the breach of any provision hereof shall constitute a waiver of any subsequent breach of the same provision, or any breach of any other provision.

20.3

Termination for Insolvency. If either party is adjudicated as bankrupt or files a voluntary petition in bankruptcy, reorganization, readjustment, or rearrangement of its business or affairs, if a receiver is appointed for either party, if either party makes or attempts an assignment for the benefit of creditors, or if either party is unable to meet its obligations in the normal course of business as they fall due then, in accordance with applicable law, the other party shall have the right to terminate this Agreement by giving such financially distressed party thirty (30) days written notice, whereupon this Agreement shall automatically terminate.

20.4	Termination for Force Majeure. If Force Majeure delays delivery of Products past thirty (30) days, Deere may terminate this Agreement in whole or in part without penalty upon written notice to Titan.

21.	REMEDIES CUMULATIVE – Each of the rights and remedies of the parties set forth in this agreement shall be cumulative with all other such rights and remedies, as well as with all rights and remedies of the parties otherwise available at law or in equity.

22.

NO PRESS RELEASE. Unless required by law or by governmental regulation, it is agreed that no press release, public announcements, confirmation or other information regarding supply orders for the Products under this Agreement, or the fact that negotiations for new products or increased quantities for existing orders are occurring, will be made by Titan without the prior written approval of Deere or by Deere without the prior written approval of Titan.

23.

PROHIBITION OF USE OF DEERE NAME AND TRADEMARKS. Titan shall not use the name of Deere & Company, Deere, John Deere, any Affiliates or derivations, trademarks, trade dress, logos or the equivalent thereof in advertising of sales materials or in any other manner whatsoever without prior express written approval of Deere. Such prohibition includes, without limitation, the following:

(a)	Titan shall not refer to the existence of this Agreement without Deere’s prior express written approval;

(b)	Titan is not allowed to make any statement or representation whatsoever regarding Deere’s opinion of Titan’s company, product or services without Deere’s prior express written approval; and

(c)	If Deere provides express written approval for the use of its name, Deere further reserves the right to revoke the right to use its names at any time. Titan is allowed to use the name Deere strictly pursuant to meeting Titan’s unilateral disclosure obligations imposed by regulatory bodies.

IN WITNESS WHEREOF, the parties hereto have each caused this Agreement to be duly executed by duly authorized representatives the day, month and year first above written.

TITAN TIRE CORPORATION	DEERE & COMPANY
/s/ TITAN TIRE CORPORATION	/s/ DEERE & COMPANY

Attachment I

Attachment II

Attachment III

Attachment IV

EX-31.1 5 ex31_1.htm CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO SECTION 302 ex31_1.htm

Exhibit 31.1

CERTIFICATION

I, Maurice M. Taylor Jr., certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Titan International, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	April 23, 2010	By:	/s/ MAURICE M. TAYLOR JR.
			Maurice M. Taylor Jr.
			Chairman and Chief Executive Officer (Principal Executive Officer)

EX-31.2 6 ex31_2.htm CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO SECTION 302 ex31_2.htm

Exhibit 31.2

CERTIFICATION

I, Kent W. Hackamack, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Titan International, Inc.;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	April 23, 2010	By:	/s/ KENT W. HACKAMACK
			Kent W. Hackamack
			Vice President of Finance and Treasurer
			(Principal Financial Officer)

EX-32 7 ex32.htm CERTIFICATION PURSUANT TO SECTION 906 ex32.htm

Exhibit 32

CERTIFICATION

In connection with the Quarterly Report of Titan International, Inc. on Form 10-Q for the period ended March 31, 2010, as filed with the Securities and Exchange Commission on the date hereof (the Report), each of the undersigned hereby certifies that, to the best of their knowledge, this Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

	TITAN INTERNATIONAL, INC.
	(Registrant)

Date:	April 23, 2010	By:	/s/ MAURICE M. TAYLOR JR.
			Maurice M. Taylor Jr.
			Chairman and Chief Executive Officer (Principal Executive Officer)

		By:	/s/ KENT W. HACKAMACK
			Kent W. Hackamack
			Vice President of Finance and Treasurer
			(Principal Financial Officer)

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