Rush Enterprises, Inc. (NASDAQ:RUSHA) Files An 8-K Entry into a Material Definitive Agreement

Rush Enterprises, Inc. (NASDAQ:RUSHA) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01

Entry into a Material Definitive Agreement.

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).

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 Companys 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 Companys obligations under its Third
Amended and Restated Credit Agreement, dated as of July7, 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:

the ratio of our consolidated total liabilities to our total net worth, each as defined in the Credit Agreement, cannot exceed 3.50:1.

the ratio of our consolidated adjusted EBITDAR to our consolidated fixed charges, each as defined in the Credit Agreement, for the four quarter period then ending cannot be less than 1.20:1.

our consolidated tangible net worth, as defined in the Credit Agreement, cannot be less than (i) $355 million on or prior to March 31, 2016 and (ii) thereafter the sum of (a) the minimum consolidated tangible net worth for the prior quarter plus (b) 50% of the Companys net income for the quarter being measured (or $0 if the Company has a net loss for such quarter).

our consolidated net worth, as defined in the Credit Agreement, cannot be less than (i) $538 million on or prior to March 31, 2016 and (ii) thereafter the sum of (a) the minimum consolidated net worth for the prior quarter plus (b) 50% of the Companys net income for the quarter being measured (or $0 if the Company has a net loss for such 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:

failure to pay any principal, interest, fees, expenses or other amounts when due;

failure of any representation or warranty to be materially correct;

any breach of financial covenants or negative covenants or failure to deliver financial statements;

failure to observe any other agreement, security instrument, obligation or covenant beyond specified cure periods in certain cases;

default under other indebtedness in excess of $10.0 million;

bankruptcy or insolvency events;

judgments against us in excess of certain allowances;

any loan document or lien securing our obligations under the Credit Agreement ceases to be effective;

the subordination provisions of certain arrangements we have with other lenders fail to be enforceable;

a material adverse effect, as defined in the Credit Agreement, occurs;

a loss, theft, damage or destruction occurs with respect to any Collateral if the amount not covered by insurance exceeds $10.0 million;

any person in control of the Company is accused or alleged or charged (whether or not subsequently arraigned, indicted or convicted) by any Governmental Authority to have used any inventory or Company Vehicle in connection with the commission of any crime (other than a misdemeanor moving violation); or

a change of control, which includes the following events:

(i)

the acquisition of ownership, directly or indirectly, beneficially or of record, by any person or group (within the meaning of the Securities Exchange Act of 1934), other than Permitted Investors (as defined below), of Rush stock representing 35% or more of the aggregate ordinary voting power represented by the issued and outstanding Rush stock;

(ii)

a majority of the seats on Rushs board of directors are occupied by persons who were not directors on March 21, 2017 and were neither (i) nominated by Rushs board of directors nor (ii) appointed by directors so nominated; or

(iii)

Rush ceases, directly or indirectly, to own and control, beneficially and of record, one hundred percent (100%)of the issued and outstanding voting stock and stock equivalents of each subsidiary that is a borrower 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.

Item 2.03

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

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

Item 9.01	Financial Statements and Exhibits.
(d)	Exhibits
Exhibit No.	Description

Exhibit No.		Description
10.1		Credit Agreement, dated as of March 21, 2017 by and among the Company, the Lenders signatory thereto and BMO Harris Bank N.A., as Administrative Agent.
10.2		Security Agreement, dated as of March 21, 2017, made by the Company in favor of BMO Harris Bank N.A., as Administrative Agent.
10.3		Intercreditor Agreement, dated as of March 21, 2017, by and among BMO Harris Bank N.A., as Administrative Agent under the Credit Agreement, BMO Harris Bank N.A., as Administrative Agent and Collateral Agent under the Third Amended and Restated Credit Agreement, dated as of July 7, 2016, and the Company

About Rush Enterprises, Inc. (NASDAQ:RUSHA)
Rush Enterprises, Inc. is a retailer of commercial vehicles and related services. The Company operates through the Truck Segment, which includes its operation of a regional network of commercial vehicle dealerships under the name Rush Truck Centers. The Company, through its Rush Truck Centers, offers services, including retail sales of new and used commercial vehicles, aftermarket parts sales, service and repair facilities, financing, leasing and rental, and insurance products. Rush Truck Centers primarily sell commercial vehicles manufactured by Peterbilt, International, Hino, Ford, Isuzu, Mitsubishi Fuso, IC Bus or Blue Bird. At its Rush Truck Centers, the Company offers third party financing to assist customers in purchasing new and used commercial vehicles. Additionally, the Company sells, as agent through its insurance agency, a line of property and casualty insurance, including collision and liability insurance on commercial vehicles, cargo insurance and credit life insurance. Rush Enterprises, Inc. (NASDAQ:RUSHA) Recent Trading Information
Rush Enterprises, Inc. (NASDAQ:RUSHA) closed its last trading session down -0.42 at 31.51 with 260,402 shares trading hands.