SecProbe.io

CORRESP
1
filename1.htm

November
15, 2007

VIA FEDERAL EXPRESS AND EDGAR

Securities and Exchange Commission

Attn: Mr. H. Christopher Owings

100 F Street, N.E., Mail Stop 3561

Washington, DC  20549

  Re:

  Titan Machinery Inc.

  Amendment
  No. 3 to Registration Statement on Form S-1

  Filed
  November 15, 2007

  File No.
  333-145526

Dear Mr. Owings:

On behalf of Titan Machinery
Inc. (the “Company”), we submit this letter in response to comments from the
staff of the U.S. Securities and Exchange Commission (the “Staff”) received by
letter dated November 5, 2007.  We
appreciate the Staff’s prompt consideration of this response.

In this letter, we have
recited the comment from the Staff in italicized, bold type and have followed
the comment with the Company’s response in regular type.  References in this letter to “we”, “our” or “us”
mean the Company or its advisors, as the context may require.  The page numbers referenced in your recited
comments in this letter are the same pages indicated in your letter dated
November 5, 2007 and do not conform to the pages numbers in Amendment No. 3,
and the page numbers indicated in our responses conform to the page numbers in
Amendment No. 3.

General

1.  We note the acknowledgements
you have provided at the end of the response letter from your counsel dated
October 10, 2007.  Please ensure that
these acknowledgements are provided directly from you, not via counsel.

The Company’s acceleration
request will contain the acknowledgments provided directly from the Company.

2.             We note your
response to comment 1 in our letter dated September 28, 2007.  We note your indication that you will provide
the price range in a future filing to allow the Commission sufficient time to
review your disclosure.  At a minimum,
revise your registration statement to provide the number of shares you plan to
register, including the allocation of shares to be sold among selling
shareholders, in the next amendment, as this information is required to be
provided pursuant to Item 501(a)(2) of Regulation S-K and may not be omitted.  As to providing the price range, we remind
you to provide sufficient time to review this information and, in this regard,
please advise us of your plans as to when you will provide this information, if
not in the next amendment.

We have included in the
amended filing the price range and the number of shares we plan to register,
including the allocation of shares to be sold among selling stockholders.

3.             We note your
response to prior comment 2 in our letter dated September 28, 2007.  As previously requested, please revise your
disclosure to identify the source for the statements you provide as you have
not consistently done so.  Please also
address the following:

•                                          You
have provided support for the statement on pages 1 and 25 that you are the world’s
largest retail dealer of Case IH Agriculture equipment and a major retail
dealer of New Holland Agriculture, Case Construction and New Holland
Construction equipment in the U.S., however, it does not appear that you have
provided support for your belief that you “own and operate one of the largest
networks of full service agricultural and construction equipment stores in
North America.”  Please revise to provide
support for this statement or delete it.

•                                          We
are unable to locate the support you provided for the statement on page 2 that “[d]emand
for construction equipment in [y]our markets is primarily driven by public
infrastructure spending...”

•                                          It
does not appear that you have provided support for the statement “CNH is a
leading manufacturer and supplier of agricultural and construction equipment...”  considering the statements made by CNH in
their Form 20-F are stated in terms of their belief and indicate that CNH is “one
of the largest manufacturers” based on units sold.  Please ensure that the statements you make
are consistent with the support provided.

•                                          It
does not appear that you have provided support for the reference to Fargo and
Bismarck, North Dakota and Rapid City and Sioux Falls, South Dakota as “growing
regional trade centers” considering the support provided refers to population
growth.

•                                          On
page 51, where you indicate that CNH is the world’s fourth largest manufacturer
of construction equipment, it is not clear what support you have provided for
this statement.  We note the data you
refer us to indicating that CNH is the fifth largest company in terms of market
share.  Please advise.

The registration statement
has been revised in response to this comment to identify the sources. A
supplementary binder of supporting documentation for the statements referenced
above, which is appropriately referenced to the statements that such material
supports, will be sent to you under separate cover.

2

Risk Factors, page 8

4.             We note your response
to prior comment 8 of our letter dated September 28, 2007.  Some of your risk factor headings do not
provide enough information about the risk that follows.  For example, the risk entitled “Our business
could be harmed by adverse changes in the agricultural industries” does not
convey the risk that you discuss below it.
See also, the risk factors entitled “Adverse changes in governmental
agricultural policies may harm [y]our business,” “[y]our business could be
harmed by adverse changes in the construction industry,” and “[You] will incur
increased costs as a result of having publicly traded common stock” to name
just a few.  Please revise your risk
factors headings to ensure that they sufficiently convey the risk discussed.

The registration statement has
been revised in response to this comment.

Capitalization, page 19

5.             Please revise your
table to record the preferred stock in the mezzanine section consistent with
your balance sheets presentation.

The table in the registration
statement has been revised in response to this comment.

Dilution, page 20

6.             We note you utilize
pro forma tangible book value per share as of July 31, 2007 in computing
dilution.  Please tell us your basis for
assuming conversion of your preferred stock immediately prior to the close of
this offering.  Likewise tell us your
basis for assuming conversion of certain convertible debentures prior to
closing.  If such conversions occur
automatically upon closing please advise.

The registration statement
has been revised in response to this comment with the addition of the following
text on page 20:  “Our preferred stock
automatically converts into common stock upon consummation of this offering in
accordance with the terms of the preferred stock set forth in the applicable
certificates of designation, certain convertible subordinated debentures will
be exchanged for shares of common stock in accordance with an agreement we have
entered into with the holders of the debentures, and the other debentures will
be converted by CNH Capital into shares of common stock that CNH Capital will
sell in this offering.”

Management’s Discussion and
Analysis of Financial Condition and Results of..., page 23

Fiscal Year Ended January 31,
2007 Compared to Fiscal Year Ended January..., page 32

Revenue, page 32

7.             We note your
response to prior comment 30 in our letter dated September 28, 2007.  Please elaborate upon whether you have taken
steps to alter the “change in sales practice away from high-volume, low-margin
sales” so as to improve revenues at this store and, if not, why not.

3

The reason for the
period-to-period variance in same-store sales was because of the change in
sales practice away from high-volume, low-margin sales.  We have worked with this store to change its
sales practices to our preferred sales practice of focusing on higher margin
sales, which resulted in lower volume at the store. We have revised the
registration statement in response to this comment on page 32 to make this more
clear.

Liquidity and Capital Resources,
page 36

8.             We note your
response to prior comment 31 in our letter dated September 28, 2007.  It does not appear, however, that you have
addressed the last portion of this comment as it relates to material commitments
for capital expenditures, to disclose the nature and amount of those
commitments as well as the anticipated source of funds to fulfill the
commitments.  Please revise or advise.

We do not have any material
commitments for capital expenditures.  The
registration statement has been revised in the second paragraph under the “Adequacy
of Capital Resources” section on page 40 in response to this comment.

Contractual and Commercial
Commitment Summary, page 40

9.             We note the
revisions to your disclosure in response to comment 33 in our letter dated
September 28, 2007.  Please quantify the
impacts of insurance, taxes, maintenance and other costs required by operating
leases on your operating lease obligations.

These costs are not included
in our operating lease obligations and thus have no impact.  We do not believe that FASB Statement of
Financial Accounting Standards No. 13, Accounting for Leases,
requires these costs to be included in our operating lease obligations.

Business, page 42

Growth Strategy, page 47

10.          We note the revisions
to your disclosure in response to comment 41 in our letter dated September 28,
2007.  It does not appear, however, that
you discuss why you chose to purchase these dealers or the manner in which you
identify targets.  Please direct us to
this disclosure or revise to provide it.

                                                We feel that we
have adequately disclosed in the second and third paragraphs of the “Make
Selective Acquisitions” section on pages 49 and 50 why we choose to purchase
particular dealers and the manner in which we identify targets.  We chose to make the acquisitions as we
believed at the time of acquisition that these stores offered attractive growth
opportunities, high demand for the equipment we sell and services we offer,
management strength and contiguity with our existing geography.  Also, we have added construction stores in
local markets in which we sell agricultural equipment but do not have

4

construction dealership
agreements with CNH.  The registration
statement has been further revised in response to this comment to change the
first sentence of the third paragraph of the “Make Selective Acquisitions”
section on page 50 to the following:

                                                “We believe
that we are effectively able to identify attractive acquisition candidates due
to our leadership position in the industry, our track record of completing and
integrating acquisitions, and our contacts in and knowledge of our industry and
geographic region.”

Executive Compensation, page 65

Compensation Discussion and
Analysis, page 65

11.          We note your response
to prior comment 51 of our letter dated September 28, 2007.  Please revise your discussion to explain how
you have determined to pay differing percentages of salary to your officers
under the Executive Bonus Plan.

The registration statement
has been revised in response to this comment on page 69 to reflect the fact
that the different bonus percentages are a function of the different roles and
responsibilities of our executive officers.

12.          Under “Setting
Executive Compensation,” we note your reference to the Economic Research
Institute report.  Please revise your
discussion to identify the companies utilized in this report.

The Economic Research
Institute report we used to guide us in setting executive  compensation does not identify the companies
used in the report and the registration statement has been revised on page 67
to make this clear.

13.          We note your response
to prior comment 52 of our letter dated September 28, 2007.  You indicate, on the one hand, that you “do
not set pre-determined quantitative goals” and yet, in the sentence that
follows, you indicate that you believed that “disclosure of the specific
performance related targets would cause [you] competitive harm.”  Please revise to clarify.

The registration statement
has been revised on page 69 to clarify the manner in which the compensation
committee considers performance factors in awarding bonuses.

Material Changes to Compensation
Program, page 69

14.          We note your response
to prior comment 55 of our letter dated September 28, 2007.  Please revise to identify the comparable
company employment agreements you refer to and explain what aspects of these
agreements you utilized in establishing these terms.

The registration statement
has been revised on page 71 to more accurately reflect the manner in which we
determined the terms of the agreements.

5

Financial Statements, page F-1

15.          Some of the comments
below may result in corrections in the unaudited and audited financial
statements included in the filing.
Additionally, prior comments 62, 65, and 66 could be viewed as
correction of errors.  If so, please
report the accounting errors as prior-period adjustments by restating the
financial statements in accordance with paragraph 25 of SFAS 154.  In doing so, disclose that your previously
issued financial statements have been restated along with a description of the
nature of the errors and the effect of their correction on each financial
statement line item and per-share effect for each period presented as required
by paragraph 26 of SFAS 154.  Please also
label the appropriate columns and/or line items as “restated.”  In addition, when audited financial
statements are restated to correct an accounting error, the restatement should
be referred to in an explanatory paragraph in the report of your independent
registered public accounting firm.  Refer
to AU Sections 420 and 508 of Codification of Auditing Standards.  If you do not believe you have error
corrections as a result of staff comments, please explain your basis in detail.

We
have determined that the financial statements did include errors and have added
Footnote 21 to the audited financial statements describing the nature of the
errors and the effect of the corrections on the financial statements and
earnings per share.  We have identified
all corrected columns and line items as restated.  The error correction is also referred to in
an explanatory paragraph in the report of our independent registered public
accounting firm.

Consolidated Balance Sheets, page
F-3

16.          We note your response
to comment 62 in our letter dated September 28, 2007 and your revision to your
disclosure.  We also note that the Series
A and B preferred shareholders can require you to redeem such securities at
their stated amount plus any preferred return.
We interpret this to mean that ultimate payment of unpaid cumulative
dividends is not solely within your control.
Refer to SAB Topic 3:C.
Accordingly, please revise to record the unpaid accumulated dividend
related to the preferred stock as a charge to retained earnings and an increase
to the preferred stock accounts in the year such dividends accrued to the
benefit of the holder.  Refer to SAB
Topic 6:B for classification in the income statement.  If warrants were issued in connection with
preferred stock, tell us if you recorded a deemed dividend for the intrinsic
value of any beneficial conversion features of the preferred stock pursuant to
EITFs 98-5 and 00-27.  If not, please
show us your basis in GAAP for your conclusion, including your determination of
the fair market value of the underlying common stock and the effective
conversion rate as defined in EITF 00-27.
Finally, tell us the fair value assigned to the warrants issued with the
preferred shares disclosed in Note 14 on page F-21.