##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2009
 Commission file number 0-20797
 RUSH ENTERPRISES, INC.
  Texas
    
    74-1733016(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)555 IH 35 South, New Braunfels, TX
    
    78130(Address of principal executive offices)
    
    (Zip Code)
 (830) 626-5200
 None    Class A and Class B Common Stock, $.01 par value
 Yes o No þ
 o þ
 þ o
 o o
 o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller Reporting Company o(Do not check if a smaller reporting company.)
 Yes o No þ
 SM
  DOCUMENTS INCORPORATED BY REFERENCE
 Portions of registrants definitive proxy statement for the registrants 2010 Annual Meeting of
Shareholders, to be filed with the Securities and Exchange Commission not later than April 30,
2010, are incorporated by reference into Part III of this Form 10-K .




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##### 



RUSH ENTERPRISES, INC.
 Index to Form 10-K
 Year ended December 31, 2009
 Page No.Part IItem 1 Business
    
    
    2Item 1A Risk Factors
    
    
    13Item 1B Unresolved Staff Comments
    
    
    20Item 2 Properties
    
    
    20Item 3 Legal Proceedings
    
    
    20Part IIItem 4 Market for Registrants Common Equity, Related Shareholder Matters and Issuer Purchases of Equity Securities
    
    
    21Item 5 Selected Financial Data
    
    
    22Item 6 Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    23Item 6A Quantitative and Qualitative Disclosures about Market Risk
    
    
    39Item 7 Financial Statements and Supplementary Data
    
    
    40Item 8 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    71Item 8A Controls and Procedures
    
    
    71Item 8B Other Information
    
    
    73Part IIIItem 9 Directors and Executive Officers of the Registrant
    
    
    73Item 10 Executive Compensation
    
    
    73Item 11 Security Ownership of Certain Beneficial Owners and Management and Related Shareholder Matters
    
    
    73Item 12 Certain Relationships and Related Transactions
    
    
    73Item 13 Principal Accountant Fees and Services
    
    
    73Part IVItem 14 Exhibits and Financial Statement Schedules
    
    
    74Exhibit 21.1Exhibit 23.1Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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NOTE REGARDING FORWARD-LOOKING STATEMENTS
 Certain statements contained in this Form 10-K (or otherwise made by the Company or on the
Companys behalf from time to time in other reports, filings with the Securities and Exchange
Commission, news releases, conferences, website postings or otherwise) that are not statements
of historical fact constitute forward-looking statements within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as
amended(the Exchange Act), notwithstanding that such statements are not specifically
identified. Forward-looking statements include statements about the Companys financial
position, business strategy and plans and objectives of management of the Company for future
operations. These forward-looking statements reflect the best judgments of the Company about
the future events and trends based on the current beliefs of the Companys management as well
as assumptions made by and information currently available to the Companys management. Use
of the words may, should, continue, plan, potential, anticipate, believe,
estimate, expect, hopeful and intend and words or phrases of similar import, as they
relate to the Company or its subsidiaries or Company management, are intended to identify
forward-looking statements but are not the exclusive means of identifying such statements.
Forward-looking statements reflect the current view of the Company with respect to future
events and are subject to risks and uncertainties that could cause actual results to differ
materially from those in such statements. Important factors that could cause actual results to
differ materially from those in the forward-looking statements include, but are not limited
to, those set forth under Item 1ARisk Factors as well as future growth rates and margins for
certain of our products and services, future demand for our products and services, risks
associated with the current recession and its impact on capital markets and liquidity,
competitive factors, general economic conditions, cyclicality, market conditions in the new
and used commercial vehicle and equipment markets, customer relations, relationships with
vendors, the interest rate environment, governmental regulation and supervision, seasonality,
distribution networks, product introductions and acceptance, technological change, changes in
industry practices, one-time events and other factors described herein and in the Companys
quarterly and other reports filed with the Securities and Exchange Commission (collectively,
Cautionary Statements). Although the Company believes that its expectations are reasonable,
it can give no assurance that such expectations will prove to be correct. Based upon changing
conditions, should any one or more of these risks or uncertainties materialize, or should any
underlying assumptions prove incorrect, actual results may vary materially from those
described in any forward-looking statements. All subsequent written and oral forward-looking
statements attributable to the Company or persons acting on its behalf are expressly qualified
in their entirety by the applicable Cautionary Statements. All forward-looking statements
speak only as the date on which they are made and the Company undertakes no duty to update or
revise any forward-looking statements.
 NOTE REGARDING INCORPORATION BY REFERENCE
 The Securities and Exchange Commission (SEC) allows us to disclose important information to
you by referring you to other documents we have filed with the SEC. The information we refer
to is incorporated by reference into this Form 10-K . Please read that information.
 NOTE REGARDING TRADEMARKS USED IN THIS FORM 10-K
 Peterbilt ® is a registered trademark of Peterbilt Motors Company.
PACCAR ® is a registered trademark of PACCAR, Inc. GMC ® is a registered
trademark of General Motors Corporation. Hino ® is a registered trademark of Hino
Motors, Ltd. UD ® is a registered trademark of Nissan Diesel Motor Co., Ltd.
Isuzu ® is a registered trademark of Isuzu Motors Limited. John Deere ® is
a registered trademark of Deere & Company. Kenworth ® is a registered trademark of
PACCAR, Inc. doing business as Kenworth Truck Company. Volvo ® is a registered
trademark of Volvo Trademark Holding AB. Freightliner ® is a registered trademark of
Freightliner Corporation. Mack ® is a registered trademark of Mack Trucks, Inc.
Navistar ® is a registered trademark of Navistar International Corporation.
Caterpillar ® is a registered trademark of Caterpillar, Inc. Cummins ® is
a registered trademark of Cummins Engine Company, Inc. PacLease ® is a registered
trademark of PACCAR Leasing Corporation. CitiCapital ® is a registered trademark of
Citicorp. Ford ® is a registered trademark of Ford Motor Company.
Cummins ® is a registered trademark of Cummins Intellectual Property, Inc. Eaton is
a registered trademark of Eaton Corporation. Arvin Meritor ® is a registered
trademark of Meritor Technology, Inc. ® Case is a registered trademark of Case
Corporation. Komatsu ® is a registered trademark of Kabushiki Kaisha Komatsu
Seisakusho Corporation Japan. The CIT Group ® is a registered trademark of CIT
Group Holdings, Inc. JPMorgan Chase ® is a registered trademark of JP Morgan Chase
& Co. SAP ® is a registered trademark of SAP Aktiengesellschaft.
International ® is a registered trademark of Navistar International Transportation
Corp. Blue Bird ® is a registered trademark of Blue Bird Investment Corporation.
  1




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##### Table of Contents



PART I
 
 Item 1.
    
    Business
  Access to Company Information
  Form 10-K,
 General
      2




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Rush Truck Centers.
 Rush Truck Center
    
    Heavy-Duty
    
    Medium-Duty and Bus
    
    
    
    
    
    BodyLocation
    
    Franchise(s)
    
    Franchise(s)
    
    Parts
    
    Service
    
    ShopAlabama:Mobile
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    YesArizona:Flagstaff
    
    None
    
    None
    
    Yes
    
    Yes
    
    NoPhoenix
    
    Peterbilt
    
    Peterbilt, GMC, Hino
    
    Yes
    
    Yes
    
    YesTucson
    
    Peterbilt
    
    Peterbilt, GMC, Hino
    
    Yes
    
    Yes
    
    NoYuma
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    NoCalifornia:Escondido
    
    Peterbilt
    
    Peterbilt, Hino
    
    Yes
    
    Yes
    
    NoFontana Heavy-Duty
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    YesFontana Medium-Duty
    
    None
    
    Peterbilt, GMC, Hino, Isuzu, UD
    
    Yes
    
    Yes
    
    NoPico Rivera
    
    Peterbilt
    
    Peterbilt, UD (parts only)
    
    Yes
    
    Yes
    
    YesSan Diego
    
    Peterbilt
    
    Peterbilt, GMC, Hino
    
    Yes
    
    Yes
    
    YesSan Luis Obispo
    
    None
    
    None
    
    Yes
    
    Yes
    
    NoSylmar
    
    Peterbilt
    
    Peterbilt, UD
    
    Yes
    
    Yes
    
    NoColorado:Denver Heavy-Duty
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    YesDenver Medium-Duty
    
    None
    
    Ford, Isuzu
    
    Yes
    
    Yes
    
    NoGreeley
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    NoPueblo
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    NoFlorida:Haines City
    
    Peterbilt
    
    Peterbilt, Diamond Coach
    
    Yes
    
    Yes
    
    YesJacksonville
    
    Peterbilt
    
    Peterbilt, Hino, Diamond Coach
    
    Yes
    
    Yes
    
    YesTampa
    
    Peterbilt
    
    Peterbilt, Diamond Coach
    
    Yes
    
    Yes
    
    NoWinter Garden
    
    Peterbilt
    
    Peterbilt, GMC, Isuzu, UD, Diamond Coach
    
    Yes
    
    Yes
    
    NoGeorgia:Atlanta
    
    None
    
    GMC, Hino, Isuzu, UD
    
    Yes
    
    Yes
    
    NoNew Mexico:Albuquerque
    
    Peterbilt
    
    Peterbilt, UD
    
    Yes
    
    Yes
    
    YesLas Cruces
    
    None
    
    None
    
    Yes
    
    Yes
    
    NoNorth Carolina:Charlotte
    
    Peterbilt
    
    Peterbilt, Hino, Isuzu
    
    Yes
    
    Yes
    
    NoCharlotte
    
    International
    
    International
    
    Yes
    
    Yes
    
    YesOklahoma:Ardmore
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    NoOklahoma City
    
    Peterbilt
    
    Peterbilt, GMC, Hino
    
    Yes
    
    Yes
    
    YesTulsa
    
    Peterbilt, Volvo
    
    Peterbilt, GMC, Hino
    
    Yes
    
    Yes
    
    YesTennessee:Nashville
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    Yes
  3




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Rush Truck Center
    
    Heavy-Duty
    
    Medium-Duty and Bus
    
    
    
    
    
    BodyLocation
    
    Franchise(s)
    
    Franchise(s)
    
    Parts
    
    Service
    
    ShopTexas:Abilene
    
    Peterbilt
    
    Peterbilt
    
    Yes
    
    Yes
    
    NoAlice
    
    Peterbilt
    
    Peterbilt, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    NoAustin
    
    Peterbilt
    
    Peterbilt, GMC, Hino, Isuzu, UD, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    NoDallas Heavy-Duty
    
    Peterbilt
    
    Peterbilt, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    YesDallas Medium-Duty
    
    None
    
    Peterbilt, GMC, Hino, UD, Blue Bird, Elkhart Diamond Coach
    
    Yes
    
    Yes
    
    NoEl Paso
    
    Peterbilt
    
    Peterbilt, GMC, Hino, Isuzu
    
    Yes
    
    Yes
    
    YesFort Worth
    
    Peterbilt
    
    Peterbilt, UD, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    NoHouston
    
    Peterbilt
    
    Peterbilt, GMC, Hino, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    YesLaredo
    
    Peterbilt
    
    Peterbilt, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    YesLufkin
    
    Peterbilt
    
    Peterbilt, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    YesPharr
    
    Peterbilt
    
    Peterbilt, Hino, UD, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    YesSan Antonio
    
    Peterbilt
    
    Peterbilt, GMC, Hino, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    YesSealy
    
    Peterbilt
    
    Peterbilt, Isuzu, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    NoTexarkana
    
    Peterbilt
    
    Peterbilt, GMC, Hino, Isuzu, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    NoTyler
    
    Peterbilt
    
    Peterbilt, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    NoWaco
    
    Peterbilt
    
    Peterbilt, GMC, Hino, Isuzu, Blue Bird, Elkhart, Diamond Coach
    
    Yes
    
    Yes
    
    No
 Rush Equipment Center.
 Leasing and Rental Services.
 Financial and Insurance Products.
 Perfection Equipment.
 World Wide Tires
  4




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Industry
  Our Business Strategy
 Operating Strategy.
 
    
    One-Stop Centers. We have developed our commercial vehicle and construction
equipment dealerships as one-stop centers where, at one convenient location, our
customers can do the following: purchase new and used commercial vehicles or
construction equipment; finance, lease or rent commercial vehicles or construction
equipment; purchase aftermarket parts and accessories; and have service performed by
certified technicians. We believe that this full-service strategy also helps to
mitigate cyclical economic fluctuations because the parts and service sales at our
dealerships generally tend to be less volatile than our new and used commercial vehicle
and construction equipment sales.
 
    
    Branding Program. We employ a branding program for our dealerships through
distinctive signage and uniform marketing programs to take advantage of our existing
name recognition and to communicate the standardized high quality of our products and
reliability of our services throughout our dealership network.
 
    
    Management by Dealership Units. At each of our dealerships, we operate one
or more of the following business units: new sales, used sales, financial services,
parts, service or body shop. Our general managers measure and manage the operations of
each of our dealerships according to the specific business units operating at that
location. We believe that this system enhances the profitability of all aspects of a
dealership and increases our overall operating margins. Operating goals for each
business unit at each of our dealerships are established annually and managers are
rewarded for performance.
 
    
    Integrated Management Information Systems. In order to efficiently operate
separate business units within each dealership, we rely upon our management information
systems to determine and monitor appropriate inventory levels and product mix at each
Rush Truck Center. Each Rush Truck Center can access a centralized real-time inventory
tracking system that is accessible simultaneously by all locations. Our parts
reordering system assists each Rush Truck Center in maintaining the proper inventory
levels and typically permits inventory delivery to each location, or directly to
customers, within 24 hours from the time the order is placed. In addition, by actively
monitoring market conditions, assessing product and expansion strategies and remaining
abreast of changes within the market, we are able to proactively address
market-by-market changes by realigning and, if necessary, adding product lines and
models.
 Growth Strategy.
 
    
    Expansion Into New Geographic Areas. We plan to continue to expand our
dealership network by acquiring additional dealerships in geographic areas contiguous
to our current operations. We have successfully expanded our presence from our Texas
base into a coast-to-coast network of Rush Truck Centers. We believe the geographic
diversity of our Rush Truck Center network has significantly expanded our customer base
while reducing the effects of local economic cycles. Geographic diversification
supports the sale of commercial vehicles and parts by allowing us to allocate our
inventory among the geographic regions we serve based on market demand within these
regions.
 
    
    Expansion of Product Offerings. We intend to continue to expand our product
lines within our dealerships by adding product categories that are both complementary
to our existing product lines and well suited to our operating model such as truck
mounted cranes, refuse vehicles and towing vehicles.
  5




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
    
    the products serve a commercial customer base;
 
    
    the products provide opportunities for incremental income through related
aftermarket sales, service or financing; and
 
    
    Rush operating controls can be implemented to enhance the financial
performance of the business.
 
    
    Open Dealerships in Existing Areas of Operation. We continually evaluate
opportunities to increase our market share by adding dealerships to underserved markets
within our current areas of operation. The introduction of additional one-stop centers
enables us to enhance revenues from our existing customer base as well as increase the
awareness of the Rush brand name for new customers. In identifying new areas for
expansion, we analyze the markets level of new truck registrations, customer buying and
leasing trends and the existence of competing franchises. We also assess the potential
performance of a parts and service center. After a market has been strategically reviewed,
we survey the region for a well-situated location. Whether we acquire existing dealerships
or open a new dealership, we introduce our branding program and implement our integrated
management system.
 Management of Our Dealerships
  Rush Truck Centers
  New Truck Sales
 Rush Truck Centers
  Used Commercial Vehicle Sales
  6




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Commercial Vehicle Parts and Service
   Truck Leasing and Rental
 Rush Equipment Center
  New Construction Equipment Sales
  Used Construction Equipment Sales
 Construction Equipment Parts and Service
  7




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Financial and Insurance Products
   New and Used Commercial Vehicle Financing
 New and Used Construction Equipment Financing
 Sales and Marketing
    8




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Facility Management
 Personnel.
    Purchasing and Suppliers.
 Management Information Systems.
  Distribution and Inventory Management.
  9




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Recent Acquisitions and Dispositions
     Competition
  
    
    the accessibility of dealership locations;
 
    
    the number of dealership locations;
 
    
    price, value, quality and design of the products sold; and
 
    
    attention to customer service (including technical service).
  Dealership Agreements
 Peterbilt.
  10




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Other Commercial Vehicle Suppliers.
 John Deere.
 Other Construction Equipment Suppliers.
 Floor Plan Financing
 Trucks.
 Construction Equipment.
 Product Warranties
    11




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Trademarks
  Employees
  Seasonality
   Backlog
  Environmental Standards and Other Governmental Regulations
    12




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Item 1A.
    
    Risk Factors
   13




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Risks Related to Our Business
 We are substantially dependent upon PACCAR for the supply of Peterbilt trucks and parts, the sale
of which generates the majority of our revenues.
  
    
    maintaining our relationship with PACCAR;
 
    
    the manufacture and delivery of competitively-priced, high quality Peterbilt trucks and
parts by PACCAR in quantities sufficient to meet our requirements;
 
    
    the overall success of PACCAR and Peterbilt;
 
    
    PACCARs continuation of its Peterbilt division;
 
    
    the goodwill associated with the Peterbilt trademark, which can be adversely affected by
decisions made by PACCAR and the owners of other Peterbilt dealerships; and
 
    
    PACCAR and Peterbilts ability to offer vehicles that meet federal and state emissions
requirements.
  Our results of operations and financial condition have been and will continue to be adversely
affected by the conditions in the credit markets and unfavorable economic conditions in the United
States.
   Our growth is subject to a number of economic risks.
   14




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We may be required to obtain additional financing to maintain adequate inventory levels.
  Changes in interest rates could have a material adverse effect on our profitability.
  Our dealership agreements may be terminable upon a change of control and we cannot control whether
our controlling shareholder and management maintain their current positions.
   15




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If state dealer laws are repealed or weakened, our dealerships will be more susceptible to
termination, nonrenewal or renegotiation of their dealership agreements.
  Our dealership agreements have relatively short terms which could result in non-renewal or
imposition of less favorable terms upon renewal.
  We depend on relationships with suppliers for sales incentives, discounts and similar programs
which are material to our operations.
  Substantial competition may affect our profitability.
   16




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We could incur substantial business interruptions during our dealer management system conversion
  If we lose key personnel or are unable to attract additional qualified personnel, our business
could be adversely affected because we rely on the industry knowledge and relationships of our key
personnel.
  Natural disasters and adverse weather events can disrupt our business.
  The dollar amount of our backlog, as stated at any given time, is not necessarily indicative of our
future earnings.
    Our dealerships are subject to federal, state and local environmental regulations that may result
in claims and liabilities, which could be material.
   17




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Climate change legislation or regulations restricting emissions of greenhouse gases could result
in increased operating costs and reduced demand for our products and services.
  Negative conditions in global credit markets may impair our investments in auction rate securities.
   An impairment in the carrying value of goodwill and other indefinite-lived intangible assets could
negatively affect our operating results.
   18




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Risks Related to Our Common Stock
 We are controlled by a single shareholder and his affiliates.
  The Class A common stock has limited voting power.
  Our dealership agreements could discourage another company from acquiring us and impede our ability
to issue additional stock to raise capital or as consideration for future acquisitions.
     19




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Our Class B common stock has a low average daily trading volume. As a result, sales of our Class B
common stock could cause the market price of our Class B common stock to drop, and it may be
difficult for a stockholder to liquidate its position in our Class B common stock quickly without
adversely affecting the market price of such shares.
  
 Item 1B.
    
    Unresolved Staff Comments
  
 Item 2.
    
    Properties
    
 Item 3.
    
    Legal Proceedings
   20




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PART II
 
 Item 4.
    
    Market for Registrants Common Equity, Related Shareholder Matters, and Issuer Purchases
of Equity Securities
 SM
 SM
 2009
    
    
    2008High
    
    
    Low
    
    
    High
    
    
    LowClass A Common StockFirst Quarter
    
    $
    10.80
    
    
    $
    6.00
    
    
    $
    18.78
    
    
    $
    14.00Second Quarter
    
    
    14.91
    
    
    
    8.27
    
    
    
    17.27
    
    
    
    11.90Third Quarter
    
    
    14.88
    
    
    
    10.16
    
    
    
    15.14
    
    
    
    10.66Fourth Quarter
    
    
    13.04
    
    
    
    10.24
    
    
    
    12.69
    
    
    
    5.29Class B Common StockFirst Quarter
    
    $
    10.08
    
    
    $
    5.55
    
    
    $
    18.25
    
    
    $
    13.41Second Quarter
    
    
    12.84
    
    
    
    7.44
    
    
    
    16.16
    
    
    
    10.35Third Quarter
    
    
    12.71
    
    
    
    8.65
    
    
    
    14.04
    
    
    
    9.56Fourth Quarter
    
    
    10.93
    
    
    
    8.41
    
    
    
    12.70
    
    
    
    5.75
     Maximum Number (orTotal Number of
    
    
    Approximate DollarShares Purchased
    
    
    Value) of Shares thatTotal Number
    
    
    Average Price
    
    
    as Part of Publicly
    
    
    May Yet Be Purchasedof Shares
    
    
    Paid Per
    
    
    Announced Plans
    
    
    Under the Plans orPeriod
    
    Purchased
    
    
    Share
    
    
    or Programs
    
    
    Programs (1)(2)October 1  31, 2009
    
    
    
    
    
    $
    0.00
    
    
    
    
    
    
    $
    2,093,321November 1  30, 2009
    
    
    
    
    
    
    0.00
    
    
    
    
    
    
    
    2,093,321December 1  31, 2009
    
    
    
    
    
    
    0.00
    
    
    
    
    
    
    
    2,093,3214th Quarter Total
    
    
    
    
    
    $
    0.00
    
    
    
    
    
    
    $
    2,093,321
 (1)
    
    On July 22, 2008, the Companys Board of Directors approved a stock repurchase program
authorizing the Company to repurchase, from time to time, up to an aggregate of $20,000,000 of
its shares of Class A Common Stock and/or Class B Common Stock. The stock repurchase program
has no expiration date and may be suspended or discontinued at any time.(2)
    
    As of December 31, 2009, the Company has repurchased 1,639,843 shares of its Class B
common stock at a cost of $17.9 million, none of which occurred during the 2009 fiscal year. Form 10-K,
  21




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Item 5.
    
    Selected Financial Data
  Year Ended December 31,2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005(in thousands, except per share amounts)SUMMARY OF INCOME STATEMENT DATARevenuesNew and used commercial vehicle sales
    
    $
    738,705
    
    
    $
    1,041,189
    
    
    $
    1,393,253
    
    
    $
    1,780,418
    
    
    $
    1,400,736Parts and service
    
    
    410,839
    
    
    
    478,439
    
    
    
    480,611
    
    
    
    441,424
    
    
    
    365,908Construction equipment sales
    
    
    22,799
    
    
    
    62,168
    
    
    
    74,986
    
    
    
    59,545
    
    
    
    41,692Lease and rental
    
    
    53,710
    
    
    
    54,813
    
    
    
    52,103
    
    
    
    41,776
    
    
    
    33,975Finance and insurance
    
    
    7,630
    
    
    
    12,291
    
    
    
    21,663
    
    
    
    19,197
    
    
    
    15,356Other
    
    
    5,606
    
    
    
    6,056
    
    
    
    8,163
    
    
    
    8,163
    
    
    
    7,103Total revenues
    
    
    1,239,289
    
    
    
    1,654,956
    
    
    
    2,030,779
    
    
    
    2,350,523
    
    
    
    1,864,770Cost of products sold
    
    
    1,014,198
    
    
    
    1,358,244
    
    
    
    1,678,711
    
    
    
    1,997,856
    
    
    
    1,582,078Gross profit
    
    
    225,091
    
    
    
    296,712
    
    
    
    352,068
    
    
    
    352,667
    
    
    
    282,692Selling, general and administrative
    
    
    199,496
    
    
    
    228,057
    
    
    
    240,661
    
    
    
    230,056
    
    
    
    188,667Depreciation and amortization
    
    
    16,440
    
    
    
    15,878
    
    
    
    14,935
    
    
    
    12,889
    
    
    
    10,487Gain on sale of assets
    
    
    160
    
    
    
    140
    
    
    
    239
    
    
    
    54
    
    
    
    495Operating income
    
    
    9,315
    
    
    
    52,917
    
    
    
    96,711
    
    
    
    109,776
    
    
    
    84,033Interest expense, net
    
    
    6,099
    
    
    
    7,830
    
    
    
    14,909
    
    
    
    15,718
    
    
    
    12,895Income before income taxes
    
    
    3,216
    
    
    
    45,087
    
    
    
    81,802
    
    
    
    94,058
    
    
    
    71,138(Benefit) provision for income taxes
    
    
    (2,668
    )
    
    
    16,222
    
    
    
    30,310
    
    
    
    35,272
    
    
    
    26,513Net income
    
    $
    5,884
    
    
    $
    28,865
    
    
    $
    51,492
    
    
    $
    58,786
    
    
    $
    44,625Earnings Per Share:Basic
    
    $
    0.16
    
    
    $
    0.75
    
    
    $
    1.35
    
    
    $
    1.57
    
    
    $
    1.23Diluted
    
    $
    0.16
    
    
    $
    0.75
    
    
    $
    1.33
    
    
    $
    1.55
    
    
    $
    1.19Basic weighted average shares
    
    
    37,066
    
    
    
    38,089
    
    
    
    38,059
    
    
    
    37,476
    
    
    
    36,303Diluted weighted average shares and
assumed conversions
    
    
    37,597
    
    
    
    38,587
    
    
    
    38,746
    
    
    
    37,890
    
    
    
    37,436
  22




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##### Table of Contents



Year Ended December 31,2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005OPERATING DATAUnit vehicle sales -New vehicles
    
    
    6,615
    
    
    
    9,289
    
    
    
    12,712
    
    
    
    16,492
    
    
    
    12,918Used vehicles
    
    
    2,875
    
    
    
    3,234
    
    
    
    4,101
    
    
    
    4,005
    
    
    
    3,677Total unit vehicles sales
    
    
    9,490
    
    
    
    12,523
    
    
    
    16,813
    
    
    
    20,497
    
    
    
    16,595Truck lease and rental
units (including units
under contract maintenance)
    
    
    3,033
    
    
    
    2,570
    
    
    
    2,404
    
    
    
    2,345
    
    
    
    1,798
 December 31,2009
    
    
    2008
    
    
    2007
    
    
    2006
    
    
    2005(in thousands)BALANCE SHEET DATAWorking capital
    
    $
    159,182
    
    
    $
    177,117
    
    
    $
    197,805
    
    
    $
    156,297
    
    
    $
    126,137Inventories
    
    
    269,955
    
    
    
    362,234
    
    
    
    365,947
    
    
    
    484,696
    
    
    
    338,212Total assets
    
    
    977,297
    
    
    
    1,056,790
    
    
    
    1,031,591
    
    
    
    1,128,410
    
    
    
    840,234Floor plan notes payable
    
    
    189,256
    
    
    
    282,702
    
    
    
    273,653
    
    
    
    446,354
    
    
    
    315,985Line-of-credit borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,755Long-term debt, including current portion
    
    
    209,502
    
    
    
    209,677
    
    
    
    198,945
    
    
    
    192,124
    
    
    
    133,152Capital lease obligations, including
current portion
    
    
    34,444
    
    
    
    14,820
    
    
    
    17,543
    
    
    
    17,732
    
    
    
    16,905Shareholders equity
    
    
    426,225
    
    
    
    416,041
    
    
    
    399,577
    
    
    
    339,608
    
    
    
    273,620
 
 Item 6.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
 General
  
    23




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##### Table of Contents



Key Performance Indicator
 Absorption Rate.
 Stock Dividend
   24




---



##### Table of Contents



Critical Accounting Policies and Estimates
  Inventories
  Goodwill
       25




---



##### Table of Contents



Finance and Insurance Revenue Recognition
   Insurance Accruals
   Accounting for Income Taxes
   26




---



##### Table of Contents



New Accounting Standards
  Results of Operations
  Year Ended December 31,2009
    
    
    2008
    
    
    2007New and used commercial vehicle sales
    
    
    59.6
    %
    
    
    62.9
    %
    
    
    68.6
    %Parts and service
    
    
    33.2
    
    
    
    28.9
    
    
    
    23.7Construction equipment sales
    
    
    1.8
    
    
    
    3.8
    
    
    
    3.7Lease and rental
    
    
    4.3
    
    
    
    3.3
    
    
    
    2.5Finance and insurance
    
    
    0.6
    
    
    
    0.7
    
    
    
    1.1Other
    
    
    0.5
    
    
    
    0.4
    
    
    
    0.4Total revenues
    
    
    100.0
    
    
    
    100.0
    
    
    
    100.0Cost of products sold
    
    
    81.8
    
    
    
    82.0
    
    
    
    82.7Gross profit
    
    
    18.2
    
    
    
    18.0
    
    
    
    17.3Selling, general and administrative
    
    
    16.1
    
    
    
    13.8
    
    
    
    11.9Depreciation and amortization
    
    
    1.3
    
    
    
    1.0
    
    
    
    0.7Operating income
    
    
    0.8
    
    
    
    3.2
    
    
    
    4.7Interest expense, net
    
    
    0.5
    
    
    
    0.5
    
    
    
    0.7Income before income taxes
    
    
    0.3
    
    
    
    2.7
    
    
    
    4.0(Benefit) provision for income taxes
    
    
    (0.2
    )
    
    
    1.0
    
    
    
    1.5Net income
    
    
    0.5
    %
    
    
    1.7
    %
    
    
    2.5
    %
  27




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##### Table of Contents



% Change2009
    
    
    2008vs
    
    
    vs2009
    
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Vehicle unit sales:New heavy-duty vehicles
    
    
    3,972
    
    
    
    5,516
    
    
    
    7,230
    
    
    
    -28.0
    %
    
    
    -23.7
    %New medium-duty vehicles
    
    
    2,643
    
    
    
    3,773
    
    
    
    5,482
    
    
    
    -29.8
    %
    
    
    -31.2
    %Total new vehicle unit sales
    
    
    6,615
    
    
    
    9,289
    
    
    
    12,712
    
    
    
    -28.8
    %
    
    
    -26.9
    %Used vehicles
    
    
    2,875
    
    
    
    3,234
    
    
    
    4,101
    
    
    
    -11.1
    %
    
    
    -21.1
    %Vehicle revenue:New heavy-duty vehicles
    
    $
    467.1
    
    
    $
    665.5
    
    
    $
    871.8
    
    
    
    -29.8
    %
    
    
    -23.7
    %New medium-duty vehicles
    
    
    163.7
    
    
    
    222.1
    
    
    
    289.4
    
    
    
    -26.3
    %
    
    
    -23.3
    %Total new vehicle revenue
    
    $
    630.8
    
    
    $
    887.6
    
    
    $
    1,161.2
    
    
    
    -28.9
    %
    
    
    -23.6
    %Used vehicle revenue
    
    $
    106.5
    
    
    $
    149.9
    
    
    $
    211.7
    
    
    
    -29.0
    %
    
    
    -29.2
    %Other vehicle revenue(1)
    
    $
    1.4
    
    
    $
    3.7
    
    
    $
    20.4
    
    
    
    -62.2
    %
    
    
    -81.9
    %Truck dealership absorption rate:
    
    
    95.7
    %
    
    
    105.5
    %
    
    
    104.5
    %
    
    
    -9.3
    %
    
    
    1.0
    %
 (1)
    
    Includes sales of glider kits, truck bodies, trailers and other new equipment. Industry
  Heavy-Duty Truck Market
    28




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##### Table of Contents



Medium-Duty Truck Market
   Construction Equipment Market
    
    
    levels of commercial, residential, and public construction activities; and
 
    
    state and federal highway and road construction appropriations.
  29




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##### Table of Contents



Year Ended December 31, 2009 Compared to Year Ended December 31, 2008
 Revenues
           30




---



##### Table of Contents



Gross Profit
          31




---



##### Table of Contents



Selling, General and Administrative Expenses
   Interest Expense, Net
  Income Before Income Taxes
  Income Taxes
  Year Ended December 31, 2008 Compared to Year Ended December 31, 2007
 Revenues
    32




---



##### Table of Contents



Gross Profit
    33




---



##### Table of Contents



Selling, General and Administrative Expenses
  Interest Expense, Net
  Income Before Income Taxes
  Income Taxes
   34




---



##### Table of Contents



Effects of Inflation
  Liquidity and Capital Resources
           35




---



##### Table of Contents



Cash Flows
  Cash Flows from Operating Activities
     Year Ended December 31,2009
    
    
    2008Net cash provided by operating activities (GAAP)
    
    $
    150,293
    
    
    $
    83,059(Payments) draws on floor plan notes payable
    
    
    (93,446
    )
    
    
    5,864Adjusted Cash Flows from Operating Activities (Non-GAAP)
    
    $
    56,847
    
    
    $
    88,923
 Cash Flows from Investing Activities
   36




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##### Table of Contents



Cash Flows from Financing Activities
    th
  37




---



##### Table of Contents



Cyclicality
  Off-Balance Sheet Arrangements
  Contractual Obligations
  Payments Due by PeriodLess than 1
    
    
    1-3
    
    
    3-5
    
    
    More than 5Contractual Obligations
    
    Total
    
    
    year
    
    
    years
    
    
    years
    
    
    years(in thousands)Long-term debt obligations (1)
    
    $
    209,502
    
    
    $
    55,545
    
    
    $
    84,339
    
    
    $
    61,954
    
    
    $
    7,664Capital lease obligations (2)
    
    
    38,645
    
    
    
    7,296
    
    
    
    14,951
    
    
    
    11,171
    
    
    
    5,227Operating lease obligations (3)
    
    
    30,056
    
    
    
    6,878
    
    
    
    9,813
    
    
    
    5,139
    
    
    
    8,226Floor plan debt obligation
    
    
    189,248
    
    
    
    189,248
    
    
    
    
    
    
    
    
    
    
    
    Interest obligations (4)
    
    
    29,352
    
    
    
    14,078
    
    
    
    11,376
    
    
    
    3,661
    
    
    
    237Purchase obligations (5)
    
    
    2,607
    
    
    
    1,047
    
    
    
    1,248
    
    
    
    312
    
    
    
    Total
    
    $
    499,410
    
    
    $
    274,092
    
    
    $
    121,727
    
    
    $
    82,237
    
    
    $
    21,354
 
 (1)
    
    Refer to Note 8 of Notes to Consolidated Financial Statements.(2)
    
    Refer to Note 11 of Notes to Consolidated Financial Statements. Amounts include interest.(3)
    
    Refer to Note 11 of Notes to Consolidated Financial Statements.(4)
    
    In computing interest expense, the Company used its weighted average interest rate outstanding
on fixed rate debt to estimate its interest expense on fixed rate debt. The Company used its
weighted average variable interest rate on outstanding variable rate debt at December 31, 2009 and
added 0.25 percent per year to estimate its interest expense on variable rate debt.(5)
    
    Purchase obligations represent non-cancelable contractual obligations at December 31, 2009
related to our SAP implementation.  38




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##### Table of Contents



Item 6A.
    
    Quantitative and Qualitative Disclosures about Market Risk
        39




---



##### Table of Contents



Item 7.
    
    Financial Statements and Supplementary Data
 Report of Independent Registered Public Accounting Firm
    
    
    41Consolidated Balance Sheets as of December 31, 2009 and 2008
    
    
    42Consolidated Statements of Income for the Years Ended December 31, 2009, 2008 and 2007
    
    
    43Consolidated Statements of Shareholders Equity for the Years Ended December 31, 2009, 2008 and 2007
    
    
    44Consolidated Statements of Cash Flows for the Years Ended December 31, 2009, 2008 and 2007
    
    
    45Notes to Consolidated Financial Statements
    
    
    46
  40




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##### Table of Contents



41




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##### Table of Contents



RUSH ENTERPRISES, INC. AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
  December 31,2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    149,095
    
    
    $
    146,411Investments
    
    
    
    
    
    
    7,575Accounts receivable, net
    
    
    38,869
    
    
    
    55,274Inventories
    
    
    269,955
    
    
    
    362,234Prepaid expenses and other
    
    
    3,650
    
    
    
    3,369Deferred income taxes, net
    
    
    11,414
    
    
    
    6,730Total current assets
    
    
    472,983
    
    
    
    581,593Investments
    
    
    7,575
    
    
    
    Property and equipment, net
    
    
    354,749
    
    
    
    332,147Goodwill, net
    
    
    140,836
    
    
    
    141,904Other assets, net
    
    
    1,154
    
    
    
    1,146Total assets
    
    $
    977,297
    
    
    $
    1,056,790Liabilities and shareholders equityCurrent liabilities:Floor plan notes payable
    
    $
    189,256
    
    
    $
    282,702Current maturities of long-term debt
    
    
    55,545
    
    
    
    37,665Current maturities of capital lease obligations
    
    
    5,730
    
    
    
    3,454Trade accounts payable
    
    
    22,427
    
    
    
    31,530Accrued expenses
    
    
    40,843
    
    
    
    49,125Total current liabilities
    
    
    313,801
    
    
    
    404,476Long-term debt, net of current maturities
    
    
    153,957
    
    
    
    172,011Capital lease obligations, net of current maturities
    
    
    28,714
    
    
    
    11,366Deferred income taxes, net
    
    
    54,600
    
    
    
    52,896Shareholders equity:Preferred stock, par value $.01 per share;
1,000,000 shares authorized; 0 shares
outstanding in 2009 and 2008
    
    
    
    
    
    
    Common stock, par value $.01 per share;
60,000,000 class A shares and 20,000,000 class B
shares authorized; 26,437,848 class A shares and
10,689,375 class B shares outstanding in 2009;
and 26,255,974 class A shares and 10,685,144
class B shares outstanding in 2008
    
    
    388
    
    
    
    386Additional paid-in capital
    
    
    188,116
    
    
    
    183,818Treasury stock, at cost: 1,639,843 shares
    
    
    (17,948
    )
    
    
    (17,948
    )Retained earnings
    
    
    255,669
    
    
    
    249,785Total shareholders equity
    
    
    426,225
    
    
    
    416,041Total liabilities and shareholders equity
    
    $
    977,297
    
    
    $
    1,056,790
   42




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##### Table of Contents



RUSH ENTERPRISES, INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF INCOME
  Year Ended December 31,2009
    
    
    2008
    
    
    2007Revenues:New and used commercial vehicle sales
    
    $
    738,705
    
    
    $
    1,041,189
    
    
    $
    1,393,253Parts and service
    
    
    410,839
    
    
    
    478,439
    
    
    
    480,611Construction equipment sales
    
    
    22,799
    
    
    
    62,168
    
    
    
    74,986Lease and rental
    
    
    53,710
    
    
    
    54,813
    
    
    
    52,103Finance and insurance
    
    
    7,630
    
    
    
    12,291
    
    
    
    21,663Other
    
    
    5,606
    
    
    
    6,056
    
    
    
    8,163Total revenue
    
    
    1,239,289
    
    
    
    1,654,956
    
    
    
    2,030,779Cost of products sold:New and used commercial vehicle sales
    
    
    695,334
    
    
    
    973,404
    
    
    
    1,283,993Parts and service
    
    
    250,592
    
    
    
    281,902
    
    
    
    283,912Construction equipment sales
    
    
    20,727
    
    
    
    56,095
    
    
    
    66,737Lease and rental
    
    
    47,545
    
    
    
    46,843
    
    
    
    44,069Total cost of products sold
    
    
    1,014,198
    
    
    
    1,358,244
    
    
    
    1,678,711Gross profit
    
    
    225,091
    
    
    
    296,712
    
    
    
    352,068Selling, general and administrative
    
    
    199,496
    
    
    
    228,057
    
    
    
    240,661Depreciation and amortization
    
    
    16,440
    
    
    
    15,878
    
    
    
    14,935Gain on sale of assets, net
    
    
    160
    
    
    
    140
    
    
    
    239Operating income
    
    
    9,315
    
    
    
    52,917
    
    
    
    96,711Interest income (expense):Interest income
    
    
    54
    
    
    
    2,636
    
    
    
    2,840Interest expense
    
    
    (6,153
    )
    
    
    (10,466
    )
    
    
    (17,749
    )Total interest expense, net
    
    
    (6,099
    )
    
    
    (7,830
    )
    
    
    (14,909
    )Income before taxes
    
    
    3,216
    
    
    
    45,087
    
    
    
    81,802(Benefit) provision for income taxes
    
    
    (2,668
    )
    
    
    16,222
    
    
    
    30,310Net income
    
    $
    5,884
    
    
    $
    28,865
    
    
    $
    51,492Earnings per common share:Basic
    
    $
    0.16
    
    
    $
    0.76
    
    
    $
    1.35Diluted
    
    $
    0.16
    
    
    $
    0.75
    
    
    $
    1.33
   43




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##### Table of Contents



RUSH ENTERPRISES, INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF SHAREHOLDERS EQUITY
  Common StockShares
    
    
    $0.01
    
    
    AdditionalOutstanding
    
    
    Par
    
    
    Paid-In
    
    
    Treasury
    
    
    RetainedClass A
    
    
    Class B
    
    
    Value
    
    
    Capital
    
    
    Stock
    
    
    Earnings
    
    
    TotalBalance, December 31, 2006
    
    
    25,604
    
    
    
    12,108
    
    
    
    251
    
    
    
    169,801
    
    
    
    
    
    
    
    169,556
    
    
    
    339,608Stock options exercised (including tax benefit of $2,239)
    
    
    408
    
    
    
    157
    
    
    
    4
    
    
    
    4,459
    
    
    
    
    
    
    
    
    
    
    
    4,463Stock-based compensation related to stock options and employee stock purchase plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,442
    
    
    
    
    
    
    
    
    
    
    
    3,442Issuance of common stock under employee stock purchase plan
    
    
    59
    
    
    
    
    
    
    
    
    
    
    
    572
    
    
    
    
    
    
    
    
    
    
    
    572Stock dividend (50%)
    
    
    
    
    
    
    
    
    
    
    128
    
    
    
    
    
    
    
    
    
    
    
    (128
    )
    
    
    Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    51,492
    
    
    
    51,492Balance, December 31, 2007
    
    
    26,071
    
    
    
    12,265
    
    
    
    383
    
    
    
    178,274
    
    
    
    
    
    
    
    220,920
    
    
    
    399,577Stock options exercised (including tax benefit of $791)
    
    
    130
    
    
    
    60
    
    
    
    2
    
    
    
    1,295
    
    
    
    
    
    
    
    
    
    
    
    1,297Stock-based compensation related to stock options and employee stock purchase plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,632
    
    
    
    
    
    
    
    
    
    
    
    3,632Issuance of common stock under employee stock purchase plan
    
    
    55
    
    
    
    
    
    
    
    1
    
    
    
    617
    
    
    
    
    
    
    
    
    
    
    
    618Common stock repurchases
    
    
    
    
    
    
    (1,640
    )
    
    
    
    
    
    
    
    
    
    
    (17,948
    )
    
    
    
    
    
    
    (17,948
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    28,865
    
    
    
    28,865Balance, December 31, 2008
    
    
    26,256
    
    
    
    10,685
    
    
    
    386
    
    
    
    183,818
    
    
    
    (17,948
    )
    
    
    249,785
    
    
    
    416,041Stock options exercised (including tax effect of ($191))
    
    
    23
    
    
    
    4
    
    
    
    
    
    
    
    (55
    )
    
    
    
    
    
    
    
    
    
    
    (55
    )Stock-based compensation related to stock options, restricted shares and employee stock purchase plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,664
    
    
    
    
    
    
    
    
    
    
    
    3,664Vesting of restricted share awards
    
    
    68
    
    
    
    
    
    
    
    1
    
    
    
    (1
    )
    
    
    
    
    
    
    
    
    
    
    Issuance of common stock under employee stock purchase plan
    
    
    91
    
    
    
    
    
    
    
    1
    
    
    
    690
    
    
    
    
    
    
    
    
    
    
    
    691Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,884
    
    
    
    5,884Balance, December 31, 2009
    
    
    26,438
    
    
    
    10,689
    
    
    $
    388
    
    
    $
    188,116
    
    
    $
    (17,948
    )
    
    $
    255,669
    
    
    $
    426,225
   44




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##### Table of Contents



RUSH ENTERPRISES, INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
  Year Ended December 31,2009
    
    
    2008
    
    
    2007Cash flows from operating activities:Net income
    
    $
    5,884
    
    
    $
    28,865
    
    
    $
    51,492Adjustments to reconcile net income to net cash used in operating activities, net of acquisitions-Depreciation and amortization
    
    
    40,698
    
    
    
    38,508
    
    
    
    35,798Gain on sale of property and equipment, net
    
    
    (160
    )
    
    
    (276
    )
    
    
    (239
    )Stock-based compensation expense related to employee stock
options and employee stock purchases
    
    
    3,664
    
    
    
    3,632
    
    
    
    3,442Provision (benefit) for deferred income tax expense
    
    
    (2,980
    )
    
    
    9,944
    
    
    
    7,516Excess tax provision (benefits) from stock-based compensation
    
    
    191
    
    
    
    (791
    )
    
    
    (2,239
    )Change in accounts receivable, net
    
    
    16,405
    
    
    
    (4,821
    )
    
    
    25,689Change in inventories
    
    
    104,450
    
    
    
    30,057
    
    
    
    132,357Change in prepaid expenses and other, net
    
    
    (281
    )
    
    
    (1,670
    )
    
    
    429Change in trade accounts payable
    
    
    (9,103
    )
    
    
    (8,922
    )
    
    
    3,003Change in accrued expenses
    
    
    (8,473
    )
    
    
    (11,467
    )
    
    
    1,453Net cash provided by operating activities
    
    
    150,295
    
    
    
    83,059
    
    
    
    258,701Cash flows from investing activities:Purchase of investments
    
    
    
    
    
    
    (355,575
    )
    
    
    Proceeds from the sale of investments
    
    
    
    
    
    
    348,000
    
    
    
    Acquisition of property and equipment
    
    
    (50,485
    )
    
    
    (68,160
    )
    
    
    (65,268
    )Proceeds from the sale of property and equipment
    
    
    481
    
    
    
    1,487
    
    
    
    4,916Business acquisitions
    
    
    
    
    
    
    (37,397
    )
    
    
    (7,866
    )Other
    
    
    246
    
    
    
    602
    
    
    
    712Net cash used in investing activities
    
    
    (49,758
    )
    
    
    (111,043
    )
    
    
    (67,506
    )Cash flows from financing activities:(Payments) draws on floor plan notes payable, net
    
    
    (93,446
    )
    
    
    5,864
    
    
    
    (172,701
    )Proceeds from long-term debt
    
    
    50,417
    
    
    
    46,728
    
    
    
    43,211Payments on long-term debt
    
    
    (50,591
    )
    
    
    (43,344
    )
    
    
    (37,890
    )Payments on capital lease obligations
    
    
    (4,693
    )
    
    
    (5,672
    )
    
    
    (3,344
    )Issuance of shares relating to employee stock options and
employee stock purchase plan
    
    
    827
    
    
    
    1,124
    
    
    
    2,796Excess tax (provision) benefits from stock-based compensation
    
    
    (191
    )
    
    
    791
    
    
    
    2,239Purchase of treasury stock
    
    
    
    
    
    
    (17,948
    )
    
    
    Debt issuance costs
    
    
    (176
    )
    
    
    (157
    )
    
    
    (55
    )Net cash used in financing activities
    
    
    (97,853
    )
    
    
    (12,614
    )
    
    
    (165,744
    )Net increase (decrease) in cash and cash equivalents
    
    
    2,684
    
    
    
    (40,598
    )
    
    
    25,451Cash and cash equivalents, beginning of year
    
    
    146,411
    
    
    
    187,009
    
    
    
    161,558Cash and cash equivalents, end of year
    
    $
    149,095
    
    
    $
    146,411
    
    
    $
    187,009Supplemental disclosure of cash flow information:Cash paid during the year for:Interest
    
    $
    14,298
    
    
    $
    16,605
    
    
    $
    23,690Income taxes, net of refunds
    
    $
    2,392
    
    
    $
    6,387
    
    
    $
    18,716Noncash investing and financing activities:Assets acquired under capital leases
    
    $
    24,317
    
    
    $
    2,949
    
    
    $
    3,511Note payable related to acquisition
    
    
    
    
    
    
    
    
    
    $
    1,500
   45




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##### Table of Contents



RUSH ENTERPRISES, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 ORGANIZATION AND OPERATIONS
    SIGNIFICANT ACCOUNTING POLICIES
 Principles of Consolidation
  Estimates in Financial Statements
  Cash and Cash Equivalents
   46




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##### Table of Contents



Allowance for Doubtful Receivables and Repossession Losses
  Inventories
  Property and Equipment
  Estimated Life2009
    
    
    2008
    
    
    (Years)Land
    
    $
    45,432
    
    
    $
    44,523
    
    
    
    Buildings and improvements
    
    
    93,755
    
    
    
    86,862
    
    
    
    31 - 39Leasehold improvements
    
    
    20,584
    
    
    
    18,330
    
    
    
    2 - 39Machinery and shop equipment
    
    
    28,057
    
    
    
    27,851
    
    
    
    5 - 20Furniture, fixtures and computers
    
    
    26,171
    
    
    
    26,541
    
    
    
    3 - 15Transportation equipment
    
    
    30,735
    
    
    
    30,670
    
    
    
    2 - 15Lease and rental vehicles
    
    
    207,820
    
    
    
    189,107
    
    
    
    2 - 8Construction in progress
    
    
    46,082
    
    
    
    32,860Accumulated depreciation and amortization
    
    
    (143,887
    )
    
    
    (124,597
    )Total
    
    $
    354,749
    
    
    $
    332,147
  Goodwill
   47




---



##### Table of Contents



Income Taxes
    48




---



##### Table of Contents



Revenue Recognition Policies
  Cost of Sales
   49




---



##### Table of Contents



Taxes Assessed by a Governmental Authority
  Selling, General and Administrative Expenses
  Stock Based Compensation
      50




---



##### Table of Contents



2009
    
    
    2008
    
    
    2007Expected stock volatility
    
    
    46.3%
    
    
    
    35.7% - 36.7%
    
    
    
    36.7% - 38.9%Weighted-average stock volatility
    
    
    46.3%
    
    
    
    36.7%
    
    
    
    38.8%Expected dividend yield
    
    
    0.0%
    
    
    
    0.0%
    
    
    
    0.0%Risk-free interest rate
    
    
    1.87%
    
    
    
    2.41%
    
    
    
    4.66%Expected life (years)
    
    
    5.0
    
    
    
    5.0
    
    
    
    5.0Weighted-average fair value of
stock options granted
    
    
    $3.25
    
    
    
    $5.62
    
    
    
    $5.66
  Advertising Costs
  Accounting for Internal Use Software
  New Accounting Pronouncements
   51




---



##### Table of Contents



SUPPLIER AND CUSTOMER CONCENTRATION
 Major Suppliers and Dealership Agreements
  Distributor
    
    Expiration DatesPeterbilt
    
    March 2010 through October 2012International
    
    May 2013Volvo
    
    August 2010GMC
    
    October 2010Isuzu
    
    IndefiniteHino
    
    IndefiniteUD
    
    IndefiniteFord
    
    IndefiniteBlue Bird
    
    August 2013John Deere
    
    Indefinite
    Primary Lenders
   Concentrations of Credit Risks
    52




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##### Table of Contents



ACCOUNTS RECEIVABLE
  December 31,2009
    
    
    2008Trade accounts receivable from sale of vehicles and construction equipment
    
    $
    14,419
    
    
    $
    25,187Other trade receivables
    
    
    10,073
    
    
    
    10,390Warranty claims
    
    
    5,505
    
    
    
    8,091Other accounts receivable
    
    
    9,629
    
    
    
    12,117Less allowance for bad debt and warranty receivable
    
    
    (757
    )
    
    
    (511
    )Total
    
    $
    38,869
    
    
    $
    55,274
 INVENTORIES
  December 31,2009
    
    
    2008New commercial vehicles
    
    $
    147,213
    
    
    $
    233,712Used commercial vehicles
    
    
    24,918
    
    
    
    23,081New construction equipment
    
    
    17,911
    
    
    
    17,854Used construction equipment
    
    
    26
    
    
    
    321Parts and accessories
    
    
    81,836
    
    
    
    87,883Other
    
    
    4,413
    
    
    
    5,182Less allowance
    
    
    (6,362
    )
    
    
    (5,799
    )Total
    
    $
    269,955
    
    
    $
    362,234
  53




---



##### Table of Contents



VALUATION ACCOUNTS:
  Balance
    
    
    Net Charged
    
    
    
    
    
    
    
    
    
    
    BalanceBeginning
    
    
    to Costs and
    
    
    
    
    
    
    Net Write-
    
    
    Endof Year
    
    
    Expenses
    
    
    Acquisitions
    
    
    Offs
    
    
    of Year2009Reserve for warranty receivable
and accounts receivable
    
    $
    511
    
    
    $
    1,047
    
    
    
    
    
    
    $
    (801
    )
    
    $
    757Reserve for parts inventory
    
    
    1,613
    
    
    
    1,638
    
    
    
    
    
    
    
    (1,295
    )
    
    
    1,956Reserve for equipment inventory
    
    
    723
    
    
    
    900
    
    
    
    
    
    
    
    (126
    )
    
    
    1,497Reserve for commercial vehicle
inventory
    
    
    3,463
    
    
    
    13,277
    
    
    
    
    
    
    
    (13,831
    )
    
    
    2,9092008Reserve for warranty receivable
and accounts receivable
    
    $
    327
    
    
    $
    469
    
    
    
    
    
    
    $
    (285
    )
    
    $
    511Reserve for parts inventory
    
    
    1,603
    
    
    
    933
    
    
    $
    315
    
    
    
    (1,238
    )
    
    
    1,613Reserve for equipment inventory
    
    
    328
    
    
    
    911
    
    
    
    
    
    
    
    (516
    )
    
    
    723Reserve for commercial vehicle
inventory
    
    
    3,138
    
    
    
    15,413
    
    
    
    
    
    
    
    (15,088
    )
    
    
    3,4632007Reserve for warranty receivable
and accounts receivable
    
    $
    526
    
    
    $
    170
    
    
    
    
    
    
    $
    (369
    )
    
    $
    327Reserve for parts inventory
    
    
    2,025
    
    
    
    894
    
    
    $
    232
    
    
    
    (1,548
    )
    
    
    1,603Reserve for equipment inventory
    
    
    408
    
    
    
    (31
    )
    
    
    
    
    
    
    (49
    )
    
    
    328Reserve for commercial vehicle
inventory
    
    
    1,014
    
    
    
    8,953
    
    
    
    
    
    
    
    (6,829
    )
    
    
    3,138
 Allowance for Doubtful Receivables
  Inventory
    54




---



##### Table of Contents



FLOOR PLAN NOTES PAYABLE AND LINES OF CREDIT
 Floor Plan Notes Payable
     December 31,2009
    
    
    2008Inventories, new and used vehicles and construction equipment at cost
based on specific identification, net of allowance
    
    $
    185,046
    
    
    $
    270,630Vehicle and construction equipment sale related accounts receivable
    
    
    14,419
    
    
    
    25,185Total
    
    $
    199,465
    
    
    $
    295,815Floor plan notes payable related to vehicle and construction equipment
    
    $
    189,256
    
    
    $
    282,702
 Lines of Credit
  LONG-TERM DEBT
  December 31,2009
    
    
    2008Variable interest rate term notes
    
    $
    44,543
    
    
    $
    18,171Fixed interest rate term notes
    
    
    164,959
    
    
    
    191,505Total debt
    
    
    209,502
    
    
    
    209,676Less- current maturities
    
    
    (55,545
    )
    
    
    (37,665
    )Total
    
    $
    153,957
    
    
    $
    172,011
  55




---



##### Table of Contents



2010
    
    $
    55,5452011
    
    
    50,7172012
    
    
    33,6222013
    
    
    36,8762014
    
    
    25,078Thereafter
    
    
    7,664Total
    
    $
    209,502
     FAIR VALUE OF FINANCIAL INSTRUMENTS
   DEFINED CONTRIBUTION PLAN:
    56




---



##### Table of Contents



LEASING ACTIVITIES
 Vehicle Leases as Lessee
    Capital
    
    
    OperatingLeases
    
    
    Leases2010
    
    $
    7,296
    
    
    $
    3,0152011
    
    
    7,298
    
    
    
    2,6272012
    
    
    7,653
    
    
    
    2,1842013
    
    
    5,046
    
    
    
    1,4422014
    
    
    6,125
    
    
    
    663Thereafter
    
    
    5,227
    
    
    
    236Total minimum lease payments
    
    $
    38,645
    
    
    $
    10,167Less amount representing interest
    
    
    (4,201
    )Present value of net minimum capital lease payments
    
    
    34,444Less current portion
    
    
    (5,730
    )Obligations under capital leases less current portion
    
    $
    28,714
 Customer Vehicle Leases as Lessor
  2010
    
    $
    39,5182011
    
    
    33,2132012
    
    
    26,1612013
    
    
    17,3642014
    
    
    8,761Thereafter
    
    
    4,593Total
    
    $
    129,610
  57




---



##### Table of Contents



Other Leases  Land and Buildings
  2010
    
    $
    3,8632011
    
    
    3,1382012
    
    
    1,8642013
    
    
    1,5792014
    
    
    1,455Thereafter
    
    
    7,990Total
    
    $
    19,889
 STOCK OPTIONS AND INCENTIVE PLANS
 Employee Stock Purchase Plan
 SM
 Non-Employee Director Stock Option Plan
   58




---



##### Table of Contents



Employee Incentive Plans
   Valuation and Expense Information
    59




---



##### Table of Contents



WeightedWeighted
    
    
    AverageAverage
    
    
    Remaining
    
    
    AggregateExercise
    
    
    Contractual
    
    
    IntrinsicOptions
    
    Shares
    
    
    Price
    
    
    Life (in Years)
    
    
    ValueBalance of Outstanding Options at January 1, 2009
    
    
    2,792,970
    
    
    $
    11.04Granted
    
    
    617,430
    
    
    
    7.67Exercised
    
    
    (27,061
    )
    
    
    4.97Forfeited
    
    
    (87,212
    )
    
    
    13.24Balance of Outstanding Options at December 31,
2009
    
    
    3,296,127
    
    
    $
    10.40
    
    
    
    6.52
    
    
    $
    7,773,830Vested and exercisable at December 31, 2009
    
    
    1,320,141
    
    
    $
    8.45
    
    
    
    4.68
    
    
    $
    5,057,933
   WeightedAverageNumber of
    
    
    Grant DateNon-vested Shares
    
    Shares
    
    
    Fair ValueNon-vested at January 1, 2009
    
    
    1,793,602
    
    
    $
    5.19Granted
    
    
    617,430
    
    
    
    3.25Vested
    
    
    (392,710
    )
    
    
    4.68Forfeited
    
    
    (42,336
    )
    
    
    4.97Non-vested at December 31, 2009
    
    
    1,975,986
    
    
    $
    4.69
  Stock Awards
   60




---



##### Table of Contents



WeightedAverageNumber of
    
    
    Grant DateStock Awards
    
    Shares
    
    
    Fair ValueOutstanding, January 1, 2009
    
    
    71,760
    
    
    $
    15.65Granted
    
    
    144,555
    
    
    
    8.81Vested
    
    
    (67,705
    )
    
    
    12.91Forfeited
    
    
    
    
    
    
    Outstanding, December 31, 2009
    
    
    148,610
    
    
    $
    10.24
   STOCK DIVIDEND AND STOCK REPURCHASE PLAN
 Stock Dividend
  Stock Repurchase Plan
    61




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##### Table of Contents



EARNINGS PER SHARE
  2009
    
    
    2008
    
    
    2007Numerator-Numerator for basic and diluted earnings per share-Net income available to common shareholders
    
    $
    5,884,000
    
    
    $
    28,865,000
    
    
    $
    51,492,000Denominator-Denominator for basic earnings per share, weighted
average shares
    
    
    37,065,654
    
    
    
    38,088,687
    
    
    
    38,059,240Effect of dilutive securities-Stock options and restricted shares
    
    
    530,853
    
    
    
    498,263
    
    
    
    686,477Denominator for diluted earnings per share,
adjusted weighted average shares and assumed
conversions
    
    
    37,596,507
    
    
    
    38,586,950
    
    
    
    38,745,717Basic earnings per common share
    
    $
    0.16
    
    
    $
    0.76
    
    
    $
    1.35Diluted earnings per common share and common
share equivalents
    
    $
    0.16
    
    
    $
    0.75
    
    
    $
    1.33
  2009
    
    
    2008
    
    
    2007Options
    
    
    1,557,356
    
    
    
    545,215
    
    
    
    157,500Total anti-dilutive securities
    
    
    1,557,356
    
    
    
    545,215
    
    
    
    157,500
  62




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##### Table of Contents



INCOME TAXES
 Provision for Income Taxes
  Year Ended December 31,2009
    
    
    2008
    
    
    2007Current provision (benefit)-Federal
    
    $
    (688
    )
    
    $
    4,468
    
    
    $
    20,516State
    
    
    889
    
    
    
    1,805
    
    
    
    2,278201
    
    
    
    6,273
    
    
    
    22,794Deferred provision (benefit)-Federal
    
    
    (2,614
    )
    
    
    9,809
    
    
    
    8,027State
    
    
    (255
    )
    
    
    140
    
    
    
    (511
    )(2,869
    )
    
    
    9,949
    
    
    
    7,516(Benefit) provision for income taxes
    
    $
    (2,668
    )
    
    $
    16,222
    
    
    $
    30,310
  December 31,2009
    
    
    2008Current:Deferred tax assets:Inventory
    
    $
    3,915
    
    
    $
    2,210Accounts receivable
    
    
    204
    
    
    
    139Capital lease obligations
    
    
    3,179
    
    
    
    1,360Stock options
    
    
    770
    
    
    
    595Alternative fuel tax credits
    
    
    933
    
    
    
    Accrued liabilities
    
    
    1,129
    
    
    
    1,318State net operating loss carry forward
    
    
    600
    
    
    
    344State tax credit
    
    
    587
    
    
    
    584Other
    
    
    97
    
    
    
    180Current deferred tax asset
    
    $
    11,414
    
    
    $
    6,730Non-Current:Deferred tax assets:Capital lease obligations
    
    $
    9,538
    
    
    $
    4,079Stock options
    
    
    3,079
    
    
    
    2,379Other
    
    
    
    
    
    
    47412,617
    
    
    
    6,932Deferred tax liabilities:Difference between book and tax basis-Depreciation
    
    
    (66,399
    )
    
    
    (57,901
    )LIFO inventory valuation
    
    
    (818
    )
    
    
    (1,927
    )Net non-current tax liability
    
    $
    (54,600
    )
    
    $
    (52,896
    )
   63




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##### Table of Contents



Year Ended December 31,2009
    
    
    2008
    
    
    2007Income taxes at the federal statutory rate
    
    $
    1,126
    
    
    $
    15,781
    
    
    $
    28,631State income taxes, net of federal benefit
    
    
    422
    
    
    
    1,236
    
    
    
    1,148Tax effect of permanent differences
    
    
    540
    
    
    
    (684
    )
    
    
    (143
    )Alternative fuel tax credit
    
    
    (5,304
    )
    
    
    
    
    
    
    Federal tax settlement
    
    
    700
    
    
    
    
    
    
    
    Other, net
    
    
    (152
    )
    
    
    (111
    )
    
    
    674(Benefit) provision for income taxes
    
    $
    (2,668
    )
    
    $
    16,222
    
    
    $
    30,310
    Unrecognized tax benefits at January 1, 2007
    
    $
    1,430,204Gross increases  tax positions in prior years
    
    
    535,224Unrecognized tax benefits at December 31, 2007
    
    
    1,965,428Gross increases  tax positions in current year
    
    
    426,590Reductions due to lapse of statute of limitations
    
    
    (453,334
    )Unrecognized tax benefits at December 31, 2008
    
    
    1,938,684Gross increases  tax positions in prior year
    
    
    345,863Gross increases  tax positions in current year
    
    
    94,053Decreases related to settlements with taxing authorities
    
    
    (344,737
    )Reductions due to lapse of statute of limitations
    
    
    (272,468
    )Unrecognized tax benefits at December 31, 2009
    
    $
    1,761,395
 COMMITMENTS AND CONTINGENCIES
   64




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##### Table of Contents



ACQUISITIONS
    Inventories
    
    $
    3,645Accrued expenses
    
    
    (27
    )Goodwill
    
    
    2,020Total
    
    $
    5,638
    65




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##### Table of Contents



Cash
    
    $
    1Inventories
    
    
    8,529Property and equipment
    
    
    99Accrued expenses
    
    
    (626
    )Goodwill
    
    
    5,383Total
    
    $
    13,386
    Cash
    
    $
    3,225Prepaid expenses
    
    
    44Accounts receivable
    
    
    1,672Inventories
    
    
    6,313Property and equipment
    
    
    3,071Other assets
    
    
    10Accrued expenses
    
    
    (2,587
    )Floor plan notes payable
    
    
    (3,185
    )Notes payable
    
    
    (2,379
    )Goodwill
    
    
    13,918Total
    
    $
    20,102
     66




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##### Table of Contents



Inventories
    
    $
    200Property and equipment
    
    
    36Accounts receivable
    
    
    1Accrued expenses
    
    
    (5
    )Goodwill
    
    
    584Total
    
    $
    816
    Inventories
    
    $
    5,570Property and equipment
    
    
    47Accounts receivable
    
    
    28Accrued expenses
    
    
    (11
    )Goodwill
    
    
    678Total
    
    $
    6,312
   INVESTMENTS
    67




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##### Table of Contents



MEDIUM-DUTY GMC TRUCK FRANCHISES
   68




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##### Table of Contents



UNAUDITED QUARTERLY FINANCIAL DATA
 First
    
    
    Second
    
    
    Third
    
    
    FourthQuarter
    
    
    Quarter
    
    
    Quarter
    
    
    Quarter2009Revenues
    
    $
    329,086
    
    
    $
    312,128
    
    
    $
    302,438
    
    
    $
    295,637Gross Profit
    
    
    61,700
    
    
    
    52,718
    
    
    
    57,004
    
    
    
    53,669Operating income (loss)
    
    
    5,726
    
    
    
    (2,451
    )
    
    
    1,292
    
    
    
    4,748Income (loss) before income taxes
    
    
    4,102
    
    
    
    (3,958
    )
    
    
    (250
    )
    
    
    3,322Net income (loss)
    
    $
    2,863
    
    
    $
    (1,521
    )
    
    $
    3,008
    
    
    $
    1,534Earnings (loss) per share:Basic
    
    $
    0.08
    
    
    $
    (.04
    )
    
    $
    0.08
    
    
    $
    0.04Diluted
    
    $
    0.08
    
    
    $
    (.04
    )
    
    $
    0.08
    
    
    $
    0.042008Revenues
    
    $
    403,858
    
    
    $
    454,718
    
    
    $
    413,696
    
    
    $
    382,684Gross Profit
    
    
    78,179
    
    
    
    74,413
    
    
    
    76,385
    
    
    
    67,735Operating income
    
    
    17,408
    
    
    
    11,479
    
    
    
    14,000
    
    
    
    10,030Income before income taxes
    
    
    15,481
    
    
    
    9,706
    
    
    
    12,167
    
    
    
    7,733Net income
    
    $
    9,675
    
    
    $
    6,067
    
    
    $
    8,000
    
    
    $
    5,123Earnings per share:Basic
    
    $
    0.25
    
    
    $
    0.16
    
    
    $
    0.21
    
    
    $
    0.14Diluted
    
    $
    0.25
    
    
    $
    0.16
    
    
    $
    0.21
    
    
    $
    0.14
 SEGMENTS
      69




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##### Table of Contents



ConstructionTruck
    
    
    Equipment
    
    
    AllSegment
    
    
    Segment
    
    
    Other
    
    
    Totals2009Revenues from external customers
    
    $
    1,184,400
    
    
    $
    38,836
    
    
    $
    16,053
    
    
    $
    1,239,289Interest income
    
    
    54
    
    
    
    
    
    
    
    
    
    
    
    54Interest expense
    
    
    5,315
    
    
    
    404
    
    
    
    434
    
    
    
    6,153Depreciation and amortization
    
    
    15,143
    
    
    
    550
    
    
    
    747
    
    
    
    16,440Segment income (loss) before income tax
    
    
    3,962
    
    
    
    1,294
    
    
    
    (2,040
    )
    
    
    3,216Segment assets
    
    
    924,703
    
    
    
    27,779
    
    
    
    24,815
    
    
    
    977,297Goodwill
    
    
    134,352
    
    
    
    4,075
    
    
    
    2,409
    
    
    
    140,836Expenditures for segment assets
    
    
    74,519
    
    
    
    205
    
    
    
    78
    
    
    
    74,8022008Revenues from external customers
    
    $
    1,553,298
    
    
    $
    83,763
    
    
    $
    17,895
    
    
    $
    1,654,956Interest income
    
    
    2,636
    
    
    
    
    
    
    
    
    
    
    
    2,636Interest expense
    
    
    9,359
    
    
    
    600
    
    
    
    507
    
    
    
    10,466Depreciation and amortization
    
    
    14,483
    
    
    
    605
    
    
    
    790
    
    
    
    15,878Segment income before income tax
    
    
    38,549
    
    
    
    6,045
    
    
    
    493
    
    
    
    45,087Segment assets
    
    
    1,000,470
    
    
    
    29,570
    
    
    
    26,750
    
    
    
    1,056,790Goodwill
    
    
    135,191
    
    
    
    4,075
    
    
    
    2,638
    
    
    
    141,904Expenditures for segment assets
    
    
    70,474
    
    
    
    323
    
    
    
    312
    
    
    
    71,1092007Revenues from external customers
    
    $
    1,914,897
    
    
    $
    97,130
    
    
    $
    18,752
    
    
    $
    2,030,779Interest income
    
    
    2,840
    
    
    
    
    
    
    
    
    
    
    
    2,840Interest expense
    
    
    16,324
    
    
    
    860
    
    
    
    565
    
    
    
    17,749Depreciation and amortization
    
    
    13,665
    
    
    
    558
    
    
    
    712
    
    
    
    14,935Segment income before income tax
    
    
    71,736
    
    
    
    8,527
    
    
    
    1,539
    
    
    
    81,802Segment assets
    
    
    973,434
    
    
    
    30,494
    
    
    
    27,663
    
    
    
    1,031,591Goodwill
    
    
    113,869
    
    
    
    4,075
    
    
    
    2,638
    
    
    
    120,582Expenditures for segment assets
    
    
    67,165
    
    
    
    1,022
    
    
    
    592
    
    
    
    68,779
   70




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##### Table of Contents



Item 8.
    
    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
  
 Item 8A.
    
    Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
  Managements Report on Internal Control over Financial Reporting
     71




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##### Table of Contents



Attestation Report of Independent Registered Public Accounting Firm
 Report of Independent Registered Public Accounting Firm
         
  72




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##### Table of Contents



Item 8B.
    
    Other Information
  
 PART III
 
 Item 9.
    
    Directors and Executive Officers of the Registrant
  Code of Ethics
 www.rushenterprises.com
 
 Item 10.
    
    Executive Compensation
  
 Item 11.
    
    Security Ownership of Certain Beneficial Owners and Management and Related Shareholder
Matters
  
 Item 12.
    
    Certain Relationships and Related Transactions
  
 Item 13.
    
    Principal Accountant Fees and Services
   73




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##### Table of Contents



PART IV
 
 Item 14.
    
    Exhibits and Financial Statement Schedules
 (a)(1) Financial Statements
  (a)(2) Financial Statement Schedules
   74




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##### Table of Contents



(a)(3) Exhibits
 
 Index to Exhibits:
 ExhibitNo.
    
    Identification of Exhibit3.1
    
    
    Restated Articles of Incorporation of Rush Enterprises, Inc.
(incorporated herein by reference to Exhibit 3.1 of the Companys
Quarterly Report on Form 10-Q (File No. 000-20797) for the quarter
ended June 30, 2008)3.2
    
    
    Rush Enterprises, Inc. Amended and Restated Bylaws (incorporated
herein by reference to Exhibit 3.2 of the Companys Quarterly
Report on Form 10-Q (File No. 000-20797) filed for the quarter
ended June 30, 2009).4.1
    
    
    Specimen of certificate representing Common Stock (now Class B
Common Stock), $.01 par value, of Rush Enterprises, Inc.
(incorporated herein by reference to Exhibit 4.1 of the Companys
Registration Statement No. 333-03346 on Form S-1 filed April 10,
1996)4.2
    
    
    Specimen of certificate representing Class A Common Stock, $.01
par value, of the Registrant (incorporated herein by reference to
Exhibit 4.1 of the Companys Registration Statement on Form
8-A filed July 9, 2002)10.1
    
    
    Right of First Refusal dated April 1, 1996 between Peterbilt
Motors Company and W. Marvin Rush (incorporated herein by
reference to Exhibit 10.76 of the Companys Registration Statement
No. 333-03346 on Form S-1 filed April 10, 1996)10.2
    
    
    Right of First Refusal dated April 1, 1996 between Peterbilt
Motors Company and Barbara Rush (incorporated herein by reference
to Exhibit 10.77 of the Companys Registration Statement No.
333-03346 on Form S-1 filed April 10, 1996)10.3
    
    
    Right of First Refusal dated April 1, 1996 between Peterbilt
Motors Company and W.M. Rusty Rush (incorporated herein by
reference to Exhibit 10.78 of the Companys Registration Statement
No. 333-03346 on Form S-1 filed April 10, 1996)10.4
    
    
    Right of First Refusal dated April 1, 1996 between Peterbilt
Motors Company and Robin Rush (incorporated herein by reference to
Exhibit 10.79 of the Companys Registration Statement No.
333-03346 on Form S-1 filed April 10, 1996)10.5
    +
    
    Rush Enterprises, Inc. Long-Term Incentive Plan, as amended
(incorporated herein by reference to Exhibit 4.1 of the Companys
Registration Statement No. 333-117305 on Form S-8 filed July 12,
2004)10.6
    +
    
    Form of Rush Enterprises, Inc. Long-Term Incentive Plan Stock
Option Agreement (incorporated herein by reference to Exhibit
10.85 of the Companys Registration Statement No. 333-03346 on
Form S-1 filed April 10, 1996)10.7
    +
    
    Rush Enterprises, Inc. Amended and Restated 1997 Non-Employee
Director Stock Option Plan, as amended (incorporated herein by
reference to Exhibit 4.3 of the Companys Registration Statement
No. 333-117305 on Form S-8 filed July 12, 2004)10.8
    +
    
    Form of Rush Enterprises, Inc. 1997 Non-Employee Director Stock
Option Agreement (incorporated herein by reference to Exhibit 4.4
of the Companys Registration Statement No. 333-117305 on Form S-8
filed July 12, 2004)10.9
    +
    
    Rush Enterprises, Inc. 2004 Employee Stock Purchase Plan, as
amended (incorporated herein by reference to Exhibit 4.1 of the
Companys Registration Statement No. 333-121355 on Form S-8 filed
December 17, 2004)10.10
    +
    
    Rush Enterprises, Inc. Amended and Restated 2006 Non-Employee
Director Stock Plan (incorporated herein by reference to Appendix
A of the Companys Proxy Statement filed April 9, 2008)
  75




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##### Table of Contents



ExhibitNo.
    
    Identification of Exhibit10.11
    +
    
    Form of Rush Enterprises, Inc. 2006 Non-Employee Director Stock
Option Agreement (incorporated herein by reference to Exhibit 4.4
of the Companys Registration Statement No. 333-138556 on Form S-8
filed November 9, 2006)10.12
    +
    
    Rush Enterprises, Inc. 2007 Long-Term Incentive Plan (incorporated
herein by reference to Appendix A to the Companys Proxy Statement
filed April 17, 2007)10.13
    +
    
    Form of Rush Enterprises Inc. 2007 Long-Term Incentive Plan
Restricted Stock Agreement (incorporated herein by reference to
Exhibit 10.13 of the Companys Form 10-K (File No. 000-20797) for
the year ended December 31, 2008)10.14
    +
    
    Form of Rush Enterprises Inc. 2007 Long-Term Incentive Plan Stock
Option Agreement (incorporated herein by reference to Exhibit 4.4
of the Companys Form S-8 (File No. 333-144821) filed July 24,
2007)10.15
    
    
    Form of dealer agreement between Peterbilt Motors Company and Rush
Truck Centers (incorporated herein by reference to Exhibit 10.18
of the Companys Form 10-K (File No. 000-20797) for the year ended
December 31, 1999)10.16
    
    
    Amended Restated Wholesale Security Agreement, dated August 15,
2007, by and among Rush Truck Centers of Alabama, Inc., Rush Truck
Centers of Arizona, Inc., Rush Truck Centers of California, Inc.,
Rush Medium Duty Truck Centers of Colorado, Inc., Rush Truck
Centers of Colorado, Inc., Rush Truck Centers of Florida, Inc.,
Rush Truck Centers of Georgia, Inc., Rush Truck Centers of New
Mexico, Inc., Rush Truck Centers of Oklahoma, Inc., Rush Truck
Centers of Tennessee, Inc., and Rush Truck Centers of Texas, L.P.,
Rush GMC Truck Center of El Paso, Inc., Rush GMC Truck Center of
Phoenix, Inc., Rush GMC Truck Center of San Diego, Inc., Rush GMC
Truck Center of Tucson, Inc. and General Electric Capital
Corporation (incorporated herein by reference to Exhibit 10.1 of
the Companys Current Report on Form 8-K (File No. 000-20797)
filed August 20, 2007)10.17
    
    
    First Amendment to Amended and Restated Wholesale Security
Agreement, dated October 3, 2007, by and among Rush Truck Centers
of Alabama, Inc., Rush Truck Centers of Arizona, Inc., Rush Truck
Centers of California, Inc., Rush Medium Duty Truck Centers of
Colorado, Inc., Rush Truck Centers of Colorado, Inc., Rush Truck
Centers of Florida, Inc., Rush Truck Centers of Georgia, Inc.,
Rush Truck Centers of New Mexico, Inc., Rush Truck Centers of
Oklahoma, Inc., Rush Truck Centers of Tennessee, Inc., and Rush
Truck Centers of Texas, L.P., Rush GMC Truck Center of El Paso,
Inc., Rush GMC Truck Center of Phoenix, Inc., Rush GMC Truck
Center of San Diego, Inc., Rush GMC Truck Center of Tucson, Inc.
and General Electric Capital Corporation (incorporated herein by
reference to Exhibit 10.2 of the Companys Current Report on Form
8-K (File No. 000-20797) filed October 3, 2007)10.18
    +
    
    Form of Indemnity Agreement (incorporated herein by reference to
Exhibit 10.1 of the Companys Current Report on Form 8-K (File No.
000-20797) filed February 27, 2007)10.19
    +
    
    Rush Enterprises, Inc. Executive Transition Plan (incorporated
herein by reference to Exhibit 10.1 of the Companys Current
Report on Form 8-K (File No. 000-20797) filed July 25, 2008)21.1
    *
    
    Subsidiaries of the Company23.1
    *
    
    Consent of Ernst & Young LLP
  76




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##### Table of Contents



ExhibitNo.
    
    Identification of Exhibit31.1
    *
    
    Certification of President and Chief Executive Officer pursuant to
Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302
of the Sarbanes-Oxley Act of 200231.2
    *
    
    Certification of Vice President and Chief Financial Officer
pursuant to Rules 13a-14(a) and 15d-14(a), as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 200232.1
    *++
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 200232.2
    *++
    
    Certification Pursuant to 18 U.S.C. Section 1350, as Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 *
    
    Filed herewith.+
    
    Management contract or compensatory plan or arrangement.++
    
    This exhibit shall not be deemed filed for purposes of Section 18 of
the Securities Exchange Act of 1934, or otherwise subject to the
liability of that section, and shall not be deemed to be incorporated
by reference into any filing under the Securities Act of 1933 or the
Securities Exchange Act of 1934.  77




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##### Table of Contents



SIGNATURES
  RUSH ENTERPRISES, INC.By:
    
    /s/ W. M.RUSTY RUSH
    
    Date: March 12, 2010W. M. Rusty RushPresident and Chief Executive Officer
  Signature
    
    Capacity
    
    Date/s/ W. MARVIN RUSH
    
    Chairman of the Board and Director
    
    March 12, 2010W. Marvin Rush/s/ W. M. RUSTY RUSH
    
    President and Chief Executive Officer,
    
    March 12, 2010W. M. Rusty Rush
    
    Director (Principal Executive Officer)/s/ STEVEN L. KELLER
    
    Vice President and
    
    March 12, 2010Steven L. Keller
    
    Chief Financial Officer(Principal Financial and Accounting Officer)/s/ THOMAS A. AKIN
    
    Director
    
    March 12, 2010Thomas A. Akin/s/ RONALD J. KRAUSE
    
    Director
    
    March 12, 2010Ronald J. Krause/s/ HAROLD D. MARSHALL
    
    Director
    
    March 12, 2010Harold D. Marshall/s/ JAMES C. UNDERWOOD
    
    Director
    
    March 12, 2010James C. Underwood/s/ GERALD R. SZCZEPANSKI
    
    Director
    
    March 12, 2010Gerald R. Szczepanski
  78