UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 21, 2017

Rush Enterprises, Inc.

(Exact name of registrant as specified in its charter)

Registrant’s telephone number, including area code: (830) 302-5200

Not Applicable
______________________________________________
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) 

On March 21, 2017, Rush Enterprises, Inc. (“Rush”) and certain of its subsidiaries (Rush and such subsidiaries collectively, the “Company”) entered into a Credit Agreement (the “Credit Agreement”) with the Lenders signatory thereto and BMO Harris Bank N.A., as Administrative Agent (the “Agent”).

Pursuant to the terms of the Credit Agreement, the Lenders have agreed to make up to $100 million of revolving credit loans to the Company for working capital, capital expenditures and other general corporate purposes. The amount of borrowings under the Credit Agreement are subject to borrowing base limitations based on the value of the Company’s Eligible Parts Inventory and Eligible Company Vehicles (as such terms are defined in the Credit Agreement). The Credit Agreement includes a $20 million letter of credit sublimit.

Borrowings under the Credit Agreement will bear interest at rates based on LIBOR or the Base Rate (as such terms are defined in the Credit Agreement), plus an applicable margin determined based on outstanding borrowing under the Credit Agreement. In addition, the Company is required to pay a commitment fee on the amount unused under the Credit Agreement.

We have granted the Agent, for the benefit of the Lenders, a security interest in (i) all Parts Inventory, (ii) all Company Vehicles, (iii) our present and future new and used vehicle inventory, together with all attachments, accessories, exchanges, and additions to (including replacement parts installed in or repairs to) any such inventory, (iv) all chattel paper, documents, certificates of title, certificates of origin, general intangibles, instruments, accounts and contract rights now existing or hereafter arising with respect thereto, and (iv) all cash and non-cash proceeds of any of the foregoing, in order to secure our obligations under the Credit Agreement. The foregoing collateral also secures the Company’s obligations under its Third Amended and Restated Credit Agreement, dated as of July 7, 2016 (the “Floor Plan Credit Agreement”), by and among certain subsidiaries of Rush, as borrowers, Rush, as the borrower representative and guarantor, the lenders from time to time parties thereto and BMO Harris Bank N.A., as administrative agent and collateral agent (the “Floor Plan Agent”). The Agent and the Floor Plan Agent have entered into an Intercreditor Agreement, dated as of March 21, 2017, setting forth their agreement as to certain of their respective rights and obligations with respect to the assets and properties of the Company and their understanding relative to their respective positions as secured creditors in certain assets and properties of the Company.

The Credit Agreement expires on the earlier of (i) March 21, 2020 and (ii) the date on which all commitments under the Floor Plan Credit Agreement shall have terminated, whether as a result of the occurrence of the Commitment Termination Date (as defined in the Floor Plan Credit Agreement) or otherwise. We may reduce the commitments under, or terminate, the Credit Agreement at any time.

The Credit Agreement requires us to meet the following financial covenants as of the last day of each quarter:

If an event of default exists under the Credit Agreement, the Lenders will be able to terminate the Credit Agreement and accelerate the maturity of all outstanding loans, as well as exercise other rights and remedies. Each of the following is an event of default under the Credit Agreement:

“Permitted Investors” means W. Marvin Rush, W.M. “Rusty” Rush, Robin Rush, Barbara Rush, Michael McRoberts, James Thor, Martin A. Naegelin, Scott Anderson, Derrek Weaver, Steven Keller, Corey Lowe and Rich Ryan and any other person whose stock is controlled by any one or more of the foregoing. 

Rush has guaranteed the borrowers’ obligations under the Credit Agreement.

The foregoing description is qualified in its entirety by reference to the full text of (i) the Credit Agreement, which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated in this Item 1.01 by reference, (ii) the Security Agreement, dated as of March 21, 2017, made by the Company in favor of the Agent, which is attached as Exhibit 10.2 to this Current Report on Form 8-K and incorporated in this Item 1.01 by reference, and (iii) the Intercreditor Agreement, dated as of March 21, 2017, by and among the Agent, the Floor Plan Agent and the Company, which is attached as Exhibit 10.3 to this Current Report on Form 8-K and incorporated in this Item 1.01 by reference.

The information described in Item 1.01 above relating to the Credit Agreement is incorporated into this Item 2.03 by reference.

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 hereunto duly authorized.

Dated: March 27, 2017 

EXHIBIT INDEX