Document:

EXHIBIT 10.3

 

AGREEMENT
AMENDING THE WHOLESALE SECURITY

AGREEMENT
AND CONDITIONALLY AUTHORIZING

THE
SALE OF COLLATERAL ON A

DELAYED PAYMENT PRIVILEGE BASIS

 

This
is an Agreement Amending the Wholesale Security Agreement and Conditionally
Authorizing the Sale of Collateral on a Delayed Payment Privilege Basis (the “Agreement”)
made and executed by and between the undersigned Debtors (“Debtors”) and
General Electric Capital Corporation (“GE Capital”), to effective as of September 20,
2005 (the “Effective Date”).

 

RECITALS

 

A.            Wholesale Security Agreement. Debtors
simultaneous with the execution of this Agreement, have executed and delivered
to GE Capital a Wholesale Security Agreement (the “WFA”), by which, among other
things, (a) GE Capital has agreed to provide wholesale floor plan
financing of motor vehicles and other personal property for Debtors (the “Collateral”),
and Debtors have agreed to promptly pay to GE Capital the portion of the
Advance due under the WFA as each such item of Collateral is sold by Debtors
(the “Collateral Amount Financed”); and (b) GE Capital has consented to
Debtors selling such Collateral at retail in the ordinary course of business
(the “Routine Disposition of Collateral”).

 

B.            Delayed Payment Privilege. Debtors have
requested the privilege of delaying payment of the Advance applicable, in the
limited instances where Collateral is sold by Debtors to a purchaser for whom
both an Obligor and GE Capital have agreed to a delayed payment period (the “Delayed
Payment Privilege”).

 

C.            Lien Validity and Priority. Debtors and GE
Capital desire and intend hereby to retain, in full force and effect, the
validity, enforceability and relative priority of GE Capital’s security
interest in any and all such items of Collateral as such items of Collateral
are sold by Debtors pursuant to the Delayed Payment Privilege, notwithstanding
GE Capital’s prior consent to the Routine Disposition of Collateral, unless and
until GE Capital receives the Collateral Amount Financed under the terms and
conditions as hereinafter set forth.

 

TERMS AND CONDITIONS

 

NOW, THEREFORE, in consideration of the premises, the covenants herein
set forth, and for other good and valuable consideration, the sufficiency and
receipt of which is hereby acknowledged, Debtors and GE Capital hereby agree as
follows:

 

1.             The aforementioned Wholesale Security
Agreement and any and all documents, plans, instruments or agreements relating,
modifying, substituting or attendant thereto, executed between Debtors and GE
Capital are hereby amended in form and substance by inserting therein the
following language as a separate and distinct paragraph:

 

“Notwithstanding
anything contained herein to the contrary, Debtors agree that GE Capital’s
security interest in any and all vehicles sold to a customer, and in which
event the full payment thereof by cash or on a the basis of a properly
perfected retail installment contract or other security agreement in favor of
GE Capital is not made contemporaneous with the delivery of such Collateral by
Debtors (the “Delayed Payment Collateral”), shall remain in full force and
effect in such Delayed Payment Collateral and shall not be relinquished,
extinguished, released or terminated as a consequence of such sale or delivery
unless and until the payment is thereafter made directly to GE Capital or
jointly to Debtors and GE Capital. Moreover, Debtors are expressly prohibited
and shall not have any express, implied or apparent authority to sell, lease,
transfer or otherwise dispose of any Delayed Payment Collateral unless and
until the express written permission of GE Capital is first obtained, and then
such authority shall be, in each and every instance, limited to the terms and
conditions of such written permission; it being further agreed that the terms
of this paragraph shall not be altered, modified, supplemented, qualified,
waived or amended by reason of any agreement (unless in writing executed by
Debtors and GE Capital), or by the course of performance, course of dealing, or
usage of trade by Debtors and GE Capital, of either of them.

 

 

2.             Any previously executed Agreement for the
Delayed Payment Privilege for New Floor Plan Units between Debtors and GE
Capital is superseded by the terms and conditions of this Agreement for all
Delayed Payment Privilege transactions arising on or after the effective date
thereof.

 

3.             Debtors shall advise GE Capital of each and
every potential transaction in which Debtors requests GE Capital to grant the
Delayed Payment Privilege, and the period of time for which the Delayed Payment
Privilege is being requested. Such request shall be made of GE Capital in
writing and on a form of the type and kind provided by GE Capital from time to
time. GE Capital’s consent, if any, to the request must be obtained prior to
the sale, transfer or delivery of any vehicles proposed by Debtors to be
disposed by the Delayed Payment Privilege (the “Delayed Payment Privilege
Collateral”).

 

4.             GE Capital’s consent to Debtors’ request for
disposition of Delayed Payment Privilege Collateral shall be in GE Capital’s
sole and exclusive discretion and further subject and contingent upon the
following additional terms and conditions:

 

(a)           GE Capital may, in its sole and exclusive
discretion limit the number of items of Collateral, amount outstanding and
terms and conditions for which the Delayed Payment Privilege requested by
Debtors is approved.

 

(b)           GE Capital may, in its sole and exclusive
discretion withdraw, cancel, or suspend the Delayed Payment Privilege at
anytime and for any reason upon a ten-day advance written notice and
immediately if a Debtor is in default of any agreement which Debtors have with
GE Capital; provided, however, that such withdrawal, cancellation or suspension
shall not affect the rights, interests and duties under this Agreement prior thereto.

 

(c)           Debtors shall complete, execute and deliver
to GE Capital, immediately upon the delivery of Delayed Payment Privilege
Collateral, a form of the type and kind provided by GE Capital from time to
time (the “Delivery Schedule”).

 

(d)           Debtors shall immediately pay GE Capital the
Collateral Amount Financed upon the earliest of (i) demand by GE Capital;
or (ii) receipt of the amount due from the disposition of each of the
Delayed Payment Privilege Collateral; or (iii) the “Purchaser Payment Date”
set forth on the applicable Delivery Schedule.

 

(e)           Debtors shall obtain from the person
acquiring the Delayed Payment Privilege Collateral a duly authorized and
executed acknowledgement from the Purchaser confirming that the terms of sale
including the continuation of GE Capital’s security interest in the Delayed
Payment Privilege Collateral. The acknowledgement shall be in writing and on a
form of the type and kind provided by GE Capital from time to time, which shall
be delivered to GE Capital prior to any sale, transfer or delivery of any
Delayed Payment Privilege Collateral to such person (the “Acknowledgement of
Purchaser”).

 

(f)            The grant and exercise of the Delayed Payment
Privilege by Debtors shall in no way extinguish, release or terminate GE
Capital’s security interest in the Delayed Payment Privilege Collateral unless
and until the conditions described in the amending paragraph set forth in
paragraph 1 of this Agreement and the aforesaid Acknowledgement of Purchaser
are first fulfilled, which shall then and thereafter continue in the proceeds
thereof.

 

5.             GE Capital shall have no duty or obligation
to examine, review or consider the creditworthiness of any proposed or actual
customer of Debtors for which Debtors seeks GE Capital’s consent to the Delayed
Payment Privilege and any such examination, review or consideration by GE
Capital shall be for its sole and exclusive use and purposes; the Debtors
expressly agreeing that any receipt or reliance on such information from GE
Capital would be gratuitous and unreasonable, respectively.

 

6.             Debtors’ obligation to pay GE Capital for the
Collateral Amount Financed shall be absolute, unconditional and primary,
notwithstanding (a) GE Capital consenting to the Delayed Payment
Privilege; or (b) default in the payment or acquisition terms by the
customer of the Debtors for Delayed Payment Privilege Collateral, or that of
any of customer’s surety, guarantor, co-obligor or lender; or (c) rejection
or revocation of acceptance of any Delayed Payment Privilege Collateral by such
customer; or (d) the acceptance by GE Capital of any assignment or
proceeds from any Delayed Payment Privilege 

 

2

 

Collateral; provided, however, that nothing
in this paragraph 6 is intended to permit payment to GE Capital of any more
than the greater of (i) the Collateral Amounts Financed or (ii) the
value of GE Capital’s security interest in the Delayed Payment Privilege
Collateral.

 

7.             Upon demand by GE Capital, Debtors shall
provide GE Capital with an assignment of all right, title, and interest of the
Debtors in and to the accounts, contract rights, sale proceeds or any other
interest Debtors may then or thereafter have in the Delayed Payment Privilege
Collateral. Said assignment shall be for the purpose of additional security
only and shall be on a form of the type and kind provided by GE Capital from
time to time.

 

8.             GE Capital may take such actions as it deems
appropriate to assure and enforce compliance with this Agreement, including
requesting, for audit purposes, verification from Debtors’ customers the fact
of delivery, possession, and amount, date and circumstances of payment of any
Delayed Payment Privilege Collateral, and the notification to appropriate
persons of any security interest, assignment or other claim in the Delayed
Payment Privilege Collateral of GE Capital.

 

IN
WITNESS WHEREOF, the Parties hereto execute this Agreement to be effective as
of the Effective Date.

 

Debtors:

 

Rush Truck Centers of Alabama, Inc.

Rush Truck Centers of Arizona, Inc.

Rush Truck Centers of California, Inc.

Rush Truck Centers of Colorado, Inc.

Rush Truck Centers of Florida, Inc.

Rush Truck Centers of New Mexico, Inc.

Rush Truck Centers of Oklahoma, Inc.

Rush Truck Centers of Tennessee, Inc.

 

	
  By:

  	
   

  	
  /s/ W.M.
  “Rusty Rush

  	
   

  
	
   

  
	
  Name:

  	
  W. M. “Rusty” Rush

  
	
   

  	
   

  
	
  Title:

  	
  President

  
	
   

  	
   

  
	
  Date: 

  	
  September 20, 2005

  

 

	
  Rush Truck Centers of Texas, L.P., a

  
	
  Texas limited partnership

  
	
   

  
	
  By:

  	
  RUSHTEX,
  INC., a Delaware corporation

  	
   

  
	
   

  	
  General Partner

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ W.M.
  “Rusty Rush

  	
   

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  W. M. “Rusty” Rush

  
	
   

  	
   

  
	
   

  	
  Title: President

  
	
   

  	
   

  
	
   

  	
  Date: September 20, 2005

  
							

 

	
  GENERAL ELECTRIC CAPITAL CORPORATION

  
	
   

  
	
  By:

  	
  /s/ C.
  Daniel Clark

  	
   

  
	
   

  
	
  Name: 

  	
  C. Daniel Clark

  
	
   

  	
   

  
	
  Title: 

  	
  President and General
  Manager

  
	
   

  	
   

  
	
  Date: 

  	
  September 20, 2005

  
				

 

3EXHIBIT 10.4

 

CONTINUING
GUARANTY

 

For Valuable Consideration, the receipt and
sufficiency of which is hereby acknowledged, the undersigned, for themselves,
their successors and assigns (“Guarantor”) jointly and severally and in solido,
hereby unconditionally guarantee to General Electric Capital
Corporation and its successors, endorsees and assigns, (collectively
called “GE Capital”) that each of Rush Truck Centers of Alabama, Inc.; Rush Truck Centers of Arizona, Inc.;
Rush Truck Centers of California, Inc.; Rush Truck Centers of Colorado, Inc.;
Rush Truck Centers of Florida, 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, LP (individually and collectively
the “Company”); shall promptly and fully pay all of its present and future
liabilities, obligations and indebtedness to GE Capital, matured or unmatured,
which represent advances to the Company by GE Capital pursuant to that certain
Wholesale Security Agreement dated as of September 20, 2005, between GE
Capital and the Company (as now or hereafter amended), as well as all interest
which accrues thereon and all reasonable costs of collection of the same in the
event of a default by the Company in the payment of such advances and/or
accrued interest (all of which liabilities, obligations and indebtedness are
herein individually and collectively called the “Indebtedness” ), not to exceed
the total principal sum of Three Hundred Million Dollars ($300,000,000.00) in
principal outstanding at any given point in time, plus all unpaid interest,
which has or thereafter accrues thereon, plus all reasonable costs incurred by
GE Capital in the enforcement of its rights and remedies or the collection of
such principal and accrued interest. This Guaranty is an absolute and
unconditional guarantee of payment and not of collectibility. The liability of
Guarantor hereunder is not conditional or contingent upon the genuineness or
validity of (i) any signatures on any instruments, agreements or chattel
paper related thereto (collectively called “Agreements”) given to GE Capital by
the Company and for which GE Capital advanced funds to or on behalf of the
Company in reliance thereon (ii) any security or collateral therefore (collectively
called “Security”) or the pursuit by GE Capital of any rights or remedies which
it now has or may hereafter have. If the Company fails to pay the Indebtedness
promptly as the same becomes due, or otherwise fails to perform any obligation
under any of the Agreements the Company executes in connection with the
Indebtedness, Guarantor agrees to pay on demand the entire Indebtedness and all
reasonable costs, attorneys’ fees and expenses which may be incurred by GE
Capital by reason of the Company’s default or the default of Guarantor
hereunder, and agrees to be bound by and to pay on demand any deficiency
established by the sale of any of the Agreements or any Security , all without
relief from valuation and appraisement laws and without requiring GE Capital to
(i) proceed against the Company by suit or otherwise, (ii) foreclose,
proceed against, liquidate or exhaust any of the Agreements or Security, or (iii) exercise,
pursue or enforce any right or remedy GE Capital may have against the Company,
any co-Guarantor (whether hereunder or under a separate instrument) or any
other party. Guarantor agrees that: this Guaranty shall not be discharged or
affected by any circumstances which constitute a legal or equitable discharge
of a guarantor or surety, including but not limited to the Company’s voluntary
or involuntary bankruptcy, assignment for the benefit of creditors,
reorganization, or similar proceedings affecting the Company or any of its
assets, or by the dissolution of Guarantor; the records of GE Capital shall be
received as prima facie evidence of the amount of the Indebtedness at any time
owing; one or more successive or concurrent suits may be brought and maintained
against Guarantor , at the option of GE Capital, with or without joinder of the
Company or any co- Guarantor (whether hereunder or under a separate instrument)
as parties thereto; and Guarantor will not seek a change of venue from any
jurisdiction or court in which any action, proceeding or litigation is
commenced.

 

GUARANTOR HEREBY WAIVES
NOTICE OF ANY ADVERSE CHANGE IN THE COMPANY’S CONDITION OR OF ANY OTHER FACT,
WHICH MIGHT MATERIALLY INCREASE GUARANTOR’S RISK, WHETHER OR NOT GE CAPITAL HAS
KNOWLEDGE OF THE SAME. GUARANTOR ALSO HEREBY WAIVES ANY CLAIM, RIGHT OR REMEDY
WHICH SUCH GUARANTOR MAY NOW HAVE OR HEREAFTER ACQUIRE AGAINST THE COMPANY
THAT ARISES HEREUNDER AND/OR FROM THE PERFORMANCE BY ANY GUARANTOR HEREUNDER
INCLUDING, WITHOUT LIMITATION, ANY CLAIM, REMEDY OR RIGHT OF SUBROGATION,
REIMBURSEMENT, EXONERATION, CONTRIBUTION, INDEMNIFICATION, OR PARTICIPATION IN
ANY CLAIM, RIGHT OR REMEDY OF GE CAPITAL AGAINST THE COMPANY OR ANY SECURITY
WHICH GE CAPITAL NOW HAS OR HEREAFTER ACQUIRES; WHETHER OR NOT SUCH CLAIM,
RIGHT OR REMEDY ARISES IN EQUITY, UNDER CONTRACT, BY STATUTE, UNDER COMMON LAW
OR OTHERWISE.

 

No
termination hereof shall be effective until Guarantor delivers to GE Capital a
written notice signed by them electing not to guarantee any new extension of
credit forming a part and within the dollar limits of the Indebtedness, that
may be granted by 

 

1

 

GE
Capital to the Company after its receipt of such notice, but such notice shall
not affect the obligations of the Guarantor hereunder as to any and all
Indebtedness existing at the time such notice is received. Guarantor hereby
waives (i) notice of acceptance hereof and notice of extensions of credit
forming a part and within the dollar limits of the Indebtedness given by GE
Capital to the Company from time to time; (ii) presentment, demand,
protest, and notice of non-payment or protest as to any note or other evidence
of Indebtedness signed, accepted, endorsed or assigned to GE Capital by the
Company, (iii) all exemptions and homestead laws; (iv) any other
demands and notices required by law; and (v) ANY RIGHT TO TRIAL BY JURY OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY, THE
INDEBTEDNESS OR THE AGREEMENTS. GE Capital may at any time and from time to
time, without notice to or the consent of Guarantor, and without affecting or
impairing the obligation of Guarantor hereunder; (a) renew, extend or
refinance any part or all of the Indebtedness of the Company or any
indebtedness of its customers, or of any co-Guarantor (whether hereunder or
under a separate instrument) or any other party; (b) accept partial
payments of the Indebtedness and apply such payments to any part of the
Indebtedness; (c) settle, release (by operation of law or otherwise),
compound, compromise, collect or liquidate, in any manner, any of the
Indebtedness, any Security, or any indebtedness of any co-Guarantor (whether
hereunder or under a separate instrument) or any other party; (d) consent
to the transfer of any Security; (e) bid and purchase at any sale of any
of the Agreements or Security; and (f) exercise any and all rights and
remedies available to GE Capital by law or agreement even if the exercise
thereof may affect, modify or eliminate any rights or remedies which Guarantor
may have against the Company. Guarantor shall continue to be liable under this
Guaranty, the provisions hereof shall remain in full force and effect, and GE
Capital shall not be stopped from exercising any rights hereunder,
notwithstanding (i) GE Capital waiver of or failure to enforce any of the
terms, covenants or conditions contained in any of the Agreements; (ii) any
release of, or failure on the part of GE Capital to perfect any security
interest in or foreclose, proceed against, or exhaust, any Security; or (iii) GE
Capital failure to take new, additional or substitute security or collateral
for the Indebtedness.

 

Guarantor
covenants and agrees that:  (a) it
will provide to GE Capital:  (1) within
ninety (90) days after the end of each of its fiscal years, its balance sheet
and related statement of income and statement of cash flows, prepared in
accordance with generally accepted accounting principles consistently applied (“GAAP”),
all in reasonable detail and certified by independent certified public
accountants of recognized standing selected by the undersigned; (2) within
sixty (60) days after the end of each quarter of its fiscal year, its balance
sheet and related statement of income and statement of cash flows for such
quarter, internally prepared in accordance with GAAP and certified by its chief
financial officer; and (3) within thirty (30) days after the date on which
they are filed, all regular periodic reports, forms and other filings required
to be made by the undersigned to the Securities and Exchange Commission,
including (without limitation) Forms 8Q, 10K and 10Q; and (b) it will
promptly execute and deliver to GE Capital such further documents, instruments
and assurances and take such further action as GE Capital from time to time
reasonably may request in order to carry out the intent and purpose of this
Guaranty and to establish and protect the rights and remedies created or
intended to be created in GE Capital’s favor hereunder.

 

This
Guaranty, the Indebtedness and the Agreements may be assigned by GE Capital,
without the consent of Guarantor. Guarantor agrees that if it receives written
notice of an assignment from GE Capital, Guarantor will pay all amounts due
hereunder to such assignee or as instructed by GE Capital.  Guarantor also agrees to confirm in writing
receipt of the notice of assignment and the continued enforceability of this
Guaranty as may be reasonably requested by assignee.  Guarantor
hereby waives and agrees not to assert against any such assignee any of the
defenses waived under this Guaranty.

 

Guarantor hereby represents and warrants to
GE Capital as of the date hereof that (i) it has adequate power and
capacity to enter into and perform under this Guaranty; (ii) its
execution, delivery and performance hereof have been duly authorized by all
necessary corporate, limited liability or partnership action, as applicable,
and does not and will not violate any judgment, order or law applicable to it,
or constitute a breach of or default under any indenture, mortgage, deed of
trust, or other agreement entered into by it with its creditors or any other
party, or its organizational documents; (iii) no approval, consent or
withholding of objections is required from any governmental authority or any
other entity with respect to the execution, delivery and performance by it of
this Guaranty; (iv) this Guaranty constitutes a valid, legal and binding
obligation, enforceable in accordance with its terms; (v) there are no
proceedings presently pending or threatened against it which will impair its
ability to perform under this Guaranty; (vi) it is validly existing and in
good standing under the laws of the state of its organization; (vii) each
of its financial statements delivered to GE Capital has been prepared in
accordance with generally accepted accounting principles consistently applied,
and since the date of the most recent financial statements, there has been no
material adverse change in its financial condition, business or operations; (viii) the
person(s) signing this Guaranty are acting with the full authority of its board
of directors , and hold the offices indicated below their signatures, which are
genuine; (ix) it is and will remain in material compliance with all laws
and regulations applicable to it including, without limitation, (A) ensuring
that no person who owns a controlling interest in or otherwise controls it is
or shall be (Y) listed on the Specially Designated Nationals and Blocked Person
List maintained by the Office of Foreign Assets Control (“OFAC”),
Department of the Treasury, and/or any other similar lists maintained by OFAC
pursuant to any authorizing statute, Executive Order or regulation or (Z) a
person designated under Section 1(b), (c) or (d) of Executive
Order No. 13224 (September 23, 2001), any related enabling
legislation 

 

2

 

or any other similar Executive Orders, and (B) compliance
with all applicable Bank Secrecy Act (“BSA”) laws,
regulations and government guidance on BSA compliance and on the prevention and
detection of money laundering violations. As used herein, “material compliance”
means compliance that will not result in a material adverse effect on the
Guarantor, its business or operations, or its ability to perform its
obligations under this Guaranty.

 

This
Guaranty shall be governed by, and construed in accordance with, the laws of
the State of Texas. This Guaranty shall bind the undersigned’s successors and
assigns and the benefits thereof shall extend to and include GE Capital’s
successors and assigns.

 

This Guaranty is intended
by the parties as a final expression of the guaranty of Guarantor and is also
intended as a complete and exclusive statement of the terms thereof.  No course of dealing, course of performance
or trade usage, nor any paid evidence of any kind, shall be used to supplement
or modify any of the terms hereof.  Nor
are there any conditions to the full effectiveness of this Guaranty.  This Guaranty and each of its provisions may
only be waived, modified, varied, released, terminated or surrendered, in whole
or in part, by a duly authorized written instrument signed by GE Capital.
Guarantor agrees that GE Capital may bring any legal proceedings it deems
necessary to enforce any or all of such Guarantor’s obligations hereunder in
any court in the State in which GE Capital’s office administering the
Indebtedness is located; and service of process shall be made upon Guarantor by
personal service of the summons to Guarantor be made upon its Registered Agent
at such Registered Agent’s address as reflected in the records of the Secretary
of State in the State of Guarantor’s organization . All rights and remedies of
GE Capital are cumulative and not alternative. 
Any term or provision hereof declared to be contrary to, prohibited by
or invalid under applicable laws or regulations shall be inapplicable and
deemed omitted herefrom, but shall not invalidate the remaining terms and
provisions hereof.

 

IN
WITNESS WHEREOF, the Guarantor has executed this Guaranty on September 20,
2005.

 

 

	
  Guarantor: 

  	
    Rush Enterprises, Inc. 

  	
  (L.S.)

  
	
   

  
	
   

  
	
  By: 

  	
  /s/
  W.M. “Rusty Rush

  	
   

  
	
   

  	
   

  
	
  Name: W. M. “Rusty” Rush

  
	
   

  
	
  Title: President

  
					

 

3

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