Exhibit 10.3

 

Peter Christianson
 c/o Titan Machinery Inc.

644 East Beaton Drive

West Fargo, ND 58078-2648

 

Dear Peter:

 

This letter agreement amends and restates the letter agreement dated October 1, 2010, confirming our discussions regarding your continuing as President and Chief Operating Officer of Titan Machinery Inc. (the “Company”), and sets out the terms and conditions of your employment with the Company, as follows:

 

	
Title:
    	
 
    	
You   will serve as the Company’s President and Chief Operating Officer.
    
	
 
    	
 
    	
 
    
	
Term:
    	
 
    	
Unless   terminated by either party as provided in this letter agreement, the term of   your employment as President and Chief Operating Officer of the Company under   this letter agreement shall be for a rolling three-year period (the “Term”) as follows: the initial term shall commence on   February 1, 2013 (“Effective Date”)   and end on January 31, 2016, which end date shall be automatically   extended by one year on each anniversary of the Effective Date. Thus, for   example, on February 1, 2014, the end date shall be extended to   January 31, 2017, and on February 1, 2015, the end date shall   be extended to January 31, 2018. Such automatic extensions shall   continue unless either party provides the other with written notice   terminating the automatic extensions prior to August 1 of any year.
    
	
 
    	
 
    	
 
    
	
Responsibilities:
    	
 
    	
During   your employment with the Company as President and Chief Operating Officer,   you will report to the Board of Directors of the Company (the “Board”) and will be responsible for the overall operations   and direction and financial matters of the Company. You agree to serve the   Company faithfully and to the best of your ability, and to devote your full   working time, attention and efforts to the business of the Company. You   further agree to make yourself available as needed, in a timely manner, to   address business issues that may arise. You may, to a reasonable extent,   participate in charitable activities, personal investment activities and   outside businesses that are not competitive with the business of the Company   and serve on boards of directors, so long as such activities and   directorships do not interfere with the performance of your duties and   responsibilities to the Company; provided, that you shall report on all such   activities and directorships to the Board at least annually.
    
	
 
    	
 
    	
 
    
	
Representations:
    	
 
    	
By   signing below, you represent and confirm that you are under no contractual or   legal commitments that would prevent you from fulfilling your duties and   responsibilities to the Company as President and Chief Operating Officer.
    
	
 
    	
 
    	
 
    
	
Initial   Base Salary:
    	
 
    	
You   will be paid a base salary at the rate of $500,000 per year for services   performed, in accordance with the regular payroll practices of the Company   with annual review by the Compensation Committee of the Board (the “Committee”). Your performance and base salary will be   reviewed by the Committee annually and may be adjusted upward from time to   time in the discretion of the Committee, but will not be reduced during the   Term.
    
	
 
    	
 
    	
 
    
	
Incentive   Bonus:
    	
 
    	
For   each full fiscal year of the Company that you are employed during the Term,   you will be eligible for an incentive award opportunity payable from 0% to   200% of your base salary at the rate in effect at the end of such fiscal   year, pursuant to the terms and conditions established by the Committee from   time to time, based upon a target equal to 100% of your annual base salary at   the rate in effect at such time. Objectives will be established during each   fiscal year. Any annual incentive bonus earned for a fiscal year will be paid   to you within two and one-half (21⁄2) months after the end of such fiscal year.
    


 











 

	
Long-Term   Equity Incentive:
    	
 
    	
Upon   execution of this letter agreement and on each anniversary thereafter, you   will be entitled to receive a restricted stock award. Each award shall be   granted in accordance with the terms of the Company’s Equity Grant Policy.   The number of shares under each award shall be determined by dividing your   annual base salary in effect on the date of grant by the closing sale price of   the Company’s stock on the date of grant. The risks of forfeiture to which   the restricted stock under each such award will be subject shall be as   determined by the Company’s Compensation Committee from time to time.
    
	
 
    	
 
    	
 
    
	
Benefits:
    	
 
    	
During   your employment with the Company, you will be eligible to participate in the   employee benefit plans and programs generally available to other executive   officers of the Company, and in such other employee benefit plans and   programs to the extent that you meet the eligibility requirements for each   individual plan or program and subject to the provisions, rules and   regulations applicable to each such plan or program as in effect from time to   time. The plans and programs of the Company may be modified or terminated by   the Company in its discretion.
    
	
 
    	
 
    	
 
    
	
Vacation:
    	
 
    	
During   your employment with the Company, you will receive vacation time off in   accordance with the policies and practices of the Company, except that your   annual accrual rate shall be not less than four weeks paid vacation off per   year. Vacation time shall be taken at such times so as not to unduly disrupt   the operations of the Company. While away from the office during vacation   time or otherwise, you agree that business issues may arise that require your   attention, whether remotely or in person.
    
	
 
    	
 
    	
 
    
	
Office   Location:
    	
 
    	
Your   employment will be based at the Company’s headquarters in Fargo, North   Dakota. Of course, regular travel will be required in the course of   performing your duties and responsibilities as President and Chief Operating   Officer. Pursuant to the Company’s applicable policies, this travel may   include use of aircraft in which the Company has an ownership interest.
    
	
 
    	
 
    	
 
    
	
Confidential   Information:
    	
 
    	
You   have had and will continue to have access to and familiarity with the   confidential and proprietary information of the Company. You agree that all   Confidential Information, whether or not in writing, concerning the Company   is and shall be the exclusive property of the Company. For purposes of this   paragraph, the term “Confidential Information” means information that is not   generally known and that is proprietary to the Company or that has been made   available to the Company in a manner reasonably understood to require   confidential treatment, including, without limitation, trade secret   information about the Company and its products; information relating to the   business of the Company or anticipated to be conducted by the Company; any of   the Company’s past, current or anticipated products; information about the   Company’s research, development, manufacturing, purchasing, accounting,   engineering, marketing, selling, leasing, servicing, discoveries,   improvements, inventions, designs, graphs, drawings, methods, techniques,   plans, strategies, customer lists, licensee lists, marketing plans, pricing   and other policies, forecasts, budgets, customer information, financial data,   personnel data; and any other material relating to Confidential Information,   however documented. All information that you have a reasonable basis to consider   Confidential Information or that is treated by the Company as being   Confidential Information shall be presumed to be Confidential Information,   without regard to the manner in which you obtain access to such information.

 

During   the time you are employed with the Company and for a period of ten   (10) years following the date your employment with the Company ends for   any reason (except with respect to trade secrets, which you agree to keep   confidential for so long as such information remains a trade secret), and   except (i) in the ordinary course of performing your employment duties   for the Company, (ii) as expressly authorized in writing by the Board,   or (iii) as compelled to disclose Confidential Information by judicial   or governmental authority, you agree not to disclose any Confidential   Information to persons or entities outside the Company, or to use any   Confidential Information for any other purpose, either during or after your   employment, unless and until such Confidential Information has become public 
    


 

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knowledge   without fault by you. You also agree to deliver all written, electronic,   magnetic, computer or other recorded or tangible material and copies thereof   containing Confidential Information to the Company upon the earlier of a   request by the Company or the date your employment with the Company ends. You   further agree to treat all confidential information and know-how of any   affiliate, employee, customer, contractor, vendor, or supplier of the Company,   as applicable, in the same manner as the Confidential Information.
    
	
 
    	
 
    	
 
    
	
Noncompetition:
    	
 
    	
In   consideration of you and the Company entering into this letter agreement, and   other good and valuable consideration, the receipt and sufficiency of which is   hereby acknowledged, and to protect the reasonable business interests of the   Company, you agree that while you are an employee of the Company, and for a   period of 24 months after termination of your employment for any reason, you   will not directly or indirectly, whether on your own behalf or that of a   third party (other than the Company), engage in the business (whether as an   owner of, or as employee, director or officer of or consultant to any   business, other than the Company, that is engaged in the business), of owning   or operating agricultural or construction equipment stores in any state in   which the Company or its subsidiaries owns or operates any agricultural or   construction equipment stores during the term of your employment. You agree   that the Company will be entitled to equitable relief without the requirement   of posting a bond to enforce the terms of such noncompetition restriction, in   addition to any other rights or remedies that the Company may have. In the   event that any provision of this noncompetition clause (or any other   provision contained in this letter agreement) shall be determined by any   court of competent jurisdiction to be unenforceable, such provision shall be   interpreted to extend only over the maximum period of time for which it may   be enforceable and/or over the maximum geographical area as to which it may   be enforceable and/or to the maximum extent in all other respects as to which   they may be enforceable, all as determined by such court in such action so as   to be enforceable to the extent consistent with then applicable law. This   noncompetition clause shall survive the termination of your employment, and   shall apply whether the termination of your employment is voluntary or   involuntary and regardless of the reason for such termination.
    
	
 
    	
 
    	
 
    
	
Non-Solicitation   of Employees:
    	
 
    	
You   agree that for a period of three (3) years following your employment   with the Company, you will, not directly or indirectly, either for yourself   or any other person or entity solicit, induce, or attempt to induce any   employee of the Company to leave the employ of the Company.
    
	
 
    	
 
    	
 
    
	
Termination:
    	
 
    	
You   may terminate the employment relationship during the Term with at least 60   days’ written notice. The Company may terminate the employment relationship   during the Term for Cause at any time with written notice or without Cause   with at least 60 days’ written notice. Upon termination of your employment by   either party for any reason, you will promptly resign any and all positions   you then hold as officer or director of the Company or any of its affiliates.
    
	
 
    	
 
    	
 
    
	
Severance:
    	
 
    	
In   case of involuntary termination of your employment by the Company without   Cause prior to the expiration of the Term or in the case of voluntary   resignation of your employment for Good Reason prior to the expiration of the   Term (each a “Qualifying Termination”), the   Company will pay you as severance pay an amount equal to two (2) times   the sum of (a) your annual base salary at the rate in effect on your   last day of employment plus (b) the annual incentive bonus last paid to   you preceding the Qualifying Termination. In addition, upon a Qualifying   Termination the Company will, for a period of 24 months following the   effective date of termination of your employment, allow you to continue to   participate in the Company’s group medical and dental plans at the Company’s   expense (with premiums payable on a monthly basis), to the extent you were a   participant as of your last day of employment; however, if your participation   in any such plan is barred or not permitted under the terms thereof, the   Company will arrange to provide you with substantially similar coverage at   its expense up to the expense. Benefits provided by the Company may be   reduced if you become eligible for comparable benefits from another employer or   third party.
    


 

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Payment   by the Company of any severance pay or premium reimbursements under this   paragraph will be conditioned upon you (1) signing and not revoking a   full release of all claims against the Company, its affiliates, officers,   directors, employees, agents and assigns, substantially in the form attached   to this letter agreement as Exhibit A, (2) complying with your   obligations under the Noncompetition Agreement or any other agreement between   you and the Company then in effect, (3) cooperating with the Company in   the transition of your duties, and (4) agreeing not to disparage or   defame the Company, its affiliates, officers, directors, employees, agents,   assigns, products or services.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Any   severance payable will be paid to you over 24 months in accordance with the   Company’s normal payroll practices commencing on the first day of the month   following the Qualifying Termination, but not earlier than expiration of any   rescission periods. All payments under this severance clause are subject to   applicable withholding for income and FICA taxes and any other proper   deductions. Notwithstanding the foregoing, if any of the payments described   in this severance clause are subject to the requirements of Section 409A   of the Internal Revenue Code, as amended (the “Code”),   and the Company determines that you are a “specified employee” as defined in   Section 409A of the Code, such payments shall not commence earlier than   the first day of the seventh month following your “separation from service”   as determined under Section 409A of the Code.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
For   purposes of this letter agreement, “Cause” and “Good Reason” have the   following definitions:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“Cause” means a determination in good faith by the Board of   the existence of one or more of the following: (i) commission by you of   any act constituting a felony; (ii) any intentional and/or willful act   of fraud or material dishonesty by you related to, connected with or   otherwise affecting your employment with the Company, or otherwise likely to   cause material harm to the Company or its reputation; (iii) the willful   and/or continued failure, neglect, or refusal by you to perform in all   material respects your duties with the Company as an employee, officer or director,   or to fulfill your fiduciary responsibilities to the Company, which failure,   neglect or refusal has not been cured within fifteen (15) days after   written notice thereof to you from the Company; or (iv) a material   breach by you of the Company’s material policies or codes of conduct or of   your material obligations under and other agreement between you and the   Company.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“Good Reason” means any one or more of the following occur   without your consent: (i) the assignment to you of material duties inconsistent   with your status or position as President and Chief Operating Officer, or   other action that results in a substantial diminution in your status or   position, which has not been cured by the Company within fifteen   (15) days after written notice thereof to the Company from you;   (ii) the relocation of your principal office for Company business to a   location more than forty (40) miles from the Company’s current   headquarters; or (iii) material breach by the Company of any terms or   conditions of this letter agreement, which breach has not been caused by you   and which has not been cured by the Company within fifteen (15) days   after written notice thereof to the Company from you.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
In   the event of termination of your employment by the Company for Cause,   resignation by you other than for Good Reason, or termination due to your   death or any disability for which you are qualified for benefits under the   Company’s group long-term disability program, the Company’s only obligation   hereunder shall be to pay such compensation and provide such benefits as are   earned by you through the date of termination of employment.
    
	
 
    	
 
    	
 
    
	
Indemnification:
    	
 
    	
The   Company will indemnify you in connection with your duties and   responsibilities for the Company in accordance with the Company’s bylaws and   as set forth in any indemnification agreement between you and the Company   from time to time.
    


 

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Taxes:
    	
 
    	
The   Company may withhold from any compensation payable to you in connection with   your employment such federal, state and local income and employment taxes as   the Company shall determine are required to be withheld pursuant to any   applicable law or regulation.
    
	
 
    	
 
    	
 
    
	
Remedies:
    	
 
    	
You   acknowledge that your covenants and obligations hereunder are of special,   unique, and intellectual character, which gives them a peculiar value, the   actual or threatened breach of which may result in substantial injuries and   damages, for which monetary relief may fail to provide an adequate remedy at   law. Accordingly, if the Company institutes any action or proceeding to   enforce the provisions hereof, seeking injunctive relief or specific   performance, you hereby waive the claim or defense that the Company has an   adequate remedy at law, and you will not urge in any such action or   proceeding the claim or defense that the Company has an adequate remedy at   law. Nothing in this provision limits the parties’ rights to seek any and all   remedies available under North Dakota law, including equitable and legal   relief, either separately or cumulatively, for breach or threatened breach of   contract.
    
	
 
    	
 
    	
 
    
	
Applicable   Law:
    	
 
    	
This   letter agreement shall be interpreted and construed in accordance with the   laws of the State of Delaware.
    
	
 
    	
 
    	
 
    
	
Construction:
    	
 
    	
Whenever   possible, each provision of this Agreement shall be interpreted in such   manner as to be effective and valid under applicable law, but if any   provision of this Agreement shall be prohibited by or invalid under   applicable law, such provision shall be ineffective only to the extent of   such prohibition or invalidity without invalidating the remainder of such   provision or the remaining provisions of this Agreement.
    
	
 
    	
 
    	
 
    
	
Entire   Agreement:
    	
 
    	
This   letter agreement and the documents referenced herein constitute the entire   agreement between the parties, and supersedes all prior discussions,   agreements, including but not limited to the letter agreement dated   October 1, 2010, and negotiations between us. No amendment or   modification of this letter agreement will be effective unless made in writing   and signed by you and an authorized director of the Company.
    


 

[signature page follows]

 

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Sincerely,
    	
 
    
	
 
    	
 
    
	
TITAN   MACHINERY INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Stanley Dardis
    	
 
    	
 
    
	
Stanley Dardis,
    	
 
    	
 
    
	
Chair of the Compensation Committee
    	
 
    


 

I accept and agree to the terms and conditions of employment with Titan Machinery Inc. as set forth above.

 

 

	
/s/   Peter Christianson
    	
 
    	
3/6/13
    
	
Peter   Christianson
    	
 
    	
Dated
    


 

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Exhibit A

 

FORM OF RELEASE BY PETER CHRISTIANSON

 

Definitions. I intend all words used in this Release to have their plain meanings in ordinary English. Specific terms that I use in this Release have the following meanings:

 

A.                           I, me, and my include both me (Peter Christianson) and anyone who has or obtains any legal rights or claims through me.

 

B.                           Titan means Titan Machinery Inc., any company related to Titan Machinery Inc. in the present or past (including without limitation, its predecessors, parents, subsidiaries, affiliates, joint venture partners, and divisions), and any successors of Titan Machinery Inc.

 

C.                           Company means Titan; the present and past officers, directors, committees, shareholders, and employees of Titan; any company providing insurance to Titan in the present or past; the present and past fiduciaries of any employee benefit plan sponsored or maintained by Titan (other than multiemployer plans); the attorneys for Titan; and anyone who acted on behalf of Titan or on instructions from Titan.

 

D.                           Agreement means the letter agreement between me and Titan dated February 1, 2013, including all of the documents attached to such agreement.

 

E.                            My Claims mean all of my rights that I now have to any relief of any kind from the Company, whether I now know about such rights or not, including without limitation:

 

1.         all claims arising out of or relating to my employment with Titan or the termination of that employment;

 

2.         all claims arising out of or relating to the statements, actions, or omissions of the Company;

 

3.                            all claims for any alleged unlawful discrimination, harassment, retaliation or reprisal, or other alleged unlawful practices arising under any federal, state, or local statute, ordinance, or regulation, including without limitation, claims under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act, 42 U.S.C. § 1981, the Employee Retirement Income Security Act, the Equal Pay Act, the Worker Adjustment and Retraining Notification Act, the Sarbanes-Oxley Act, the Family and Medical Leave Act, the Fair Credit Reporting Act, the North Dakota Human Rights Act, N.D. Stat. § 14.02-4-01 et seq., the North Dakota Equal Pay Act, N.D. Stat. § 34-06.1-01 et seq., the North Dakota Age Discrimination Act, N.D. Stat. § 34-01-17, and workers’ compensation non-interference or non-retaliation statutes;

 

4.                            all claims for alleged wrongful discharge; breach of contract; breach of implied contract; failure to keep any promise; breach of a covenant of good faith and fair dealing; breach of fiduciary duty; estoppel; my activities, if any, as a “whistleblower”; defamation; infliction of emotional distress; fraud; misrepresentation; negligence; harassment; retaliation or reprisal; constructive discharge; assault; battery; false imprisonment; invasion of privacy; interference with contractual or business relationships; any other wrongful employment practices; and violation of any other principle of common law;

 

5.                            all claims for compensation of any kind, including without limitation, bonuses, commissions, stock-based compensation or stock options, vacation pay and paid time off, perquisites, and expense reimbursements;

 

6.                            all claims for back pay, front pay, reinstatement, other equitable relief, compensatory damages, damages for alleged personal injury, liquidated damages, and punitive damages; and

 

7.                            all claims for attorneys’ fees, costs, and interest.

 

However, My Claims do not include any claims that the law does not allow to be waived; any claims that may arise after the date on which I sign this Release; any rights I may have to indemnification from Titan as a current or former officer, director or employee of Titan; any claims for payment of severance benefits under the Agreement; any rights I have to severance pay or benefits under the Agreement; or any claims I may have for earned and accrued benefits under any employee benefit plan sponsored by the Company in which I am a participant as of the date of termination of my employment with Titan.

 

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Consideration. I am entering into this Release in consideration of Titan’s obligations to provide me certain severance benefits as specified in the Agreement. I will receive consideration from Titan as set forth in the Agreement if I sign and do not rescind this Release as provided below. I understand and acknowledge that I would not be entitled to the consideration under the Agreement if I did not sign this Release. The consideration is in addition to anything of value that I would be entitled to receive from Titan if I did not sign this Release or if I rescinded this Release. I acknowledge and represent that I have received all payments and benefits that I am entitled to receive (as of the date of this Release) by virtue of any employment by the Company.

 

Agreement to Release My Claims. In exchange for the consideration described in the Agreement, I give up and release all of My Claims. I will not make any demands or claims  against the Company for compensation or damages relating to My Claims. The consideration that I am receiving is a fair compromise for the release of My Claims.

 

Cooperation. Upon the reasonable request of the Company, I agree that I will (i) timely execute and deliver such acknowledgements, instruments, certificates, and other ministerial documents (including without limitation, certification as to specific actions performed by me in my capacity as an officer of the Company) as may be necessary or appropriate to formalize and complete the applicable corporate records; (ii) reasonably consult with the Company regarding business matters that I was involved with while employed by the Company; and (iii) be reasonably available, with or without subpoena, to be interviewed, review documents or things, give depositions, testify, or engage in other reasonable activities in connection with any litigation or investigation, with respect to matters that I may have knowledge of by virtue of my employment by or service to the Company. In performing my obligations under this paragraph to testify or otherwise provide information, I will honestly, truthfully, forthrightly, and completely provide the information requested, volunteer pertinent information and turn over to the Company all relevant documents which are or may come into my possession.

 

My Continuing Obligations. I understand and acknowledge that I must comply with all of my post-employment obligations under the Agreement. I will not defame or disparage the reputation, character, image, products, or services of Titan, or the reputation or character of Titan’s directors, officers, employees and agents, and I will refrain from making public comment about the Company except upon the express written consent of an officer of Titan.

 

Additional Agreements and Understandings. Even though Titan will provide consideration for me to settle and release My Claims, the Company does not admit that it is responsible or legally obligated to me. In fact, the Company denies that it is responsible or legally obligated to me for My Claims, denies that it engaged in any unlawful or improper conduct toward me, and denies that it treated me unfairly.

 

Advice to Consult with an Attorney. I understand and acknowledge that I am hereby being advised by the Company to consult with an attorney prior to signing this Release and I have done so. My decision whether to sign this Release is my own voluntary decision made with full knowledge that the Company has advised me to consult with an attorney.

 

Period to Consider the Release. I understand that I have 21 days from the date I received this Release (or 21 days after the last day of my employment with Titan, if later) to consider whether I wish to sign this Release. If I sign this Release before the end of the 21-day period, it will be my voluntary decision to do so because I have decided that I do not need any additional time to decide whether to sign this Release. I understand and agree that if I sign this Release prior to my last day of employment with Titan it will not be valid and Titan will not be obligated to provide the consideration described in the Release.

 

My Right to Rescind this Release. I understand that I may rescind this Release at any time within 7 days after I sign it, not counting the day upon which I sign it. This Release will not become effective or enforceable unless and until the 7-day rescission period has expired without my rescinding it. I understand that if I rescind this Release Titan will not be obligated to provide the consideration described in the Release.

 

Procedure for Accepting or Rescinding the Release. To accept the terms of this Release, I must deliver the Release, after I have signed and dated it, to Titan by hand or by mail within the 21-day period that I have to consider this Release. To rescind my acceptance, I must deliver a written, signed statement that I rescind my acceptance to Titan by hand or by mail within the 7-day rescission period. All deliveries must be made to Titan at the following address:

 

Chief Operating Officer

 

 

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If I choose to deliver my acceptance or the rescission by mail, it must be postmarked within the period stated above and properly addressed to Titan at the address stated above.

 

Interpretation of the Release. This Release should be interpreted as broadly as possible to achieve my intention to resolve all of My Claims against the Company. If this Release is held by a court to be inadequate to release a particular claim encompassed within My Claims, this Release will remain in full force and effect with respect to all the rest of My Claims. I agree that the provisions of this Release may not be amended, waived, changed or modified except by an instrument in writing signed by an authorized representative of Titan and by me.

 

My Representations. I am legally able and entitled to receive the consideration being provided to me in settlement of My Claims. I have not been involved in any personal bankruptcy or other insolvency proceedings at any time since I began my employment with Titan. No child support orders, garnishment orders, or other orders requiring that money owed to me by Titan be paid to any other person are now in effect.

 

I have read this Release carefully. I understand all of its terms. In signing this Release, I have not relied on any statements or explanations made by the Company except as specifically set forth in the Agreement. I am voluntarily releasing My Claims against the Company. I intend this Release and the Agreement to be legally binding.

 

	
 
    	
 
    
	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
Peter   Christianson
    
				


 

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