Rush Enterprises expands revolver to $750 million, amends pricing

By Marisa Wong

Madison, Wis., July 16 - Rush Enterprises, Inc. amended its $600 million amended and restated credit agreement dated Dec. 31, 2012 to increase commitments, reduce pricing and extend the maturity date, according to an 8-K filing with the Securities and Exchange Commission.

The company entered into the third amendment to its credit agreement on July 11 with GE Capital Commercial Inc. as administrative agent and collateral agent.

Commitments were increased by $150 million to a total of $750 million.

The revolving loans consist of $640 million of revolving A loans and $110 million of revolving B loans. However, the revolving B loans cannot be made unless there is no more availability for revolving A loans, the filing noted.

The expanded revolving loans will be used to finance the company's purchase of new and used vehicle inventory and to finance working capital needs. Loans to purchase used inventory are limited to $150 million.

Borrowings under the credit agreement will now bear interest at Libor plus 203 basis points.

In addition, the company must pay the lenders a monthly working capital fee of 0.35% per year multiplied by the amount of voluntary prepayments of new and used inventory loans.

The credit agreement now expires on July 11, 2016.

GE Capital has the right to terminate the credit agreement at any time upon 120 days written notice. The company may also terminate the credit agreement at any time, but it must pay a prepayment fee of (i) $15 million if it terminates on or prior Jan. 11, 2015, (ii) $7.5 million if it terminates after Jan. 11, 2015 but on or prior to July 11, 2015 and (iii) $300,000 if it terminates after that.

Rush Enterprises owns and operates a network of commercial vehicle dealerships. It is based in New Braunfels, Texas.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.