8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of earliest event reported): October 18, 2018

USA Truck, Inc.

(Exact name of registrant as specified in its charter) 

Delaware	1-35740	71-0556971
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
3200 Industrial Park Road Van Buren, Arkansas		72956
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (479) 471-2500

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

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

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

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

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

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

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 1.01	Entry into a Material Definitive Agreement.
	On October 18, 2018, USA Truck, Inc., a Delaware corporation (the “Company”), entered into an Equity Purchase Agreement (the “Agreement”) with the equity holders (collectively, “Sellers”) of Davis Transfer Company Inc., a Georgia corporation (“DTC”), Davis Transfer Logistics Inc., a Georgia corporation (“DTL”), and B & G Leasing, L.L.C., a Georgia limited liability company (“B & G,” and collectively with DTC and DTL, “Davis”). Davis is a dry-van truckload carrier headquartered in Carnesville, Georgia, with operations primarily in the southeastern United States. Pursuant to the Agreement, the Company purchased all of Davis’ issued and outstanding equity interests from the Sellers in a cash-free, debt-free transaction (the “Transaction”). The Company paid in cash $52.25 million and in Company stock $750,000 of total consideration for the equity. The purchase price is subject to a customary working capital adjustment post-closing.  The Agreement contains customary representations, warranties, covenants, and indemnification provisions, including an escrow to secure Sellers’ indemnification obligations to the Company. The cash consideration payable to Sellers was funded pursuant to a draw on the Company’s existing credit facility with Bank of America, National Association. In connection with the Transaction, on October 18, 2018, the Company entered into a joinder agreement with Bank of America, National Association, which joined Davis to the Company’s existing credit facility. The foregoing descriptions of the Agreement and the Transaction do not purport to be complete and are qualified in their entirety by reference to the Agreement, a copy of which will be filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.
Item 2.01	Completion of Acquisition or Disposition of Assets.
	The disclosure contained in Item 1.01 above is incorporated herein by reference. Such description of the Agreement is qualified in its entirety by reference to the full text of the Agreement, a copy of which will be filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.
Item 7.01	Regulation FD Disclosure.
	On October 18, 2018, the Company issued a press release announcing the execution of the Agreement and the consummation of the Transaction. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.
Item 9.01	Financial Statements and Exhibits.
	(a)	Financial statements of businesses acquired.
		Any financial statements required by this item will be filed by the Company by amendment to this Current Report on Form 8-K not later than 71 days after the date on which this Current Report on Form 8-K was required to be filed.
	(b)	Pro forma financial information.
		Any pro forma information required by this item will be filed by the Company by amendment to this Current Report on Form 8-K not later than 71 days after the date on which this Current Report on Form 8-K was required to be filed.
	(d)	Exhibits.
	EXHIBIT NUMBER	EXHIBIT DESCRIPTION
	99.1	Press release issued by the Company on October 18, 2018.
	The information contained in Items 7.01 and 9.01 and the exhibit hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
	The information contained in Items 7.01 and 9.01 hereof and Exhibit 99.1 hereto contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended. Such statements are made based on the current beliefs and expectations of the Company’s management and are subject to significant risks and uncertainties. Actual results or events may differ from those anticipated by forward-looking statements. Please refer to various disclosures by the Company in its press releases, stockholder reports, and filings with the Securities and Exchange Commission for information concerning risks, uncertainties, and other factors that may affect future results.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		USA Truck, Inc.
		(Registrant)
Date:	October 19, 2018	/s/ Jason R. Bates
		Jason R. Bates
		Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

EXHIBIT NUMBER	EXHIBIT DESCRIPTION
99.1	Press release issued by the Company on October 18, 2018.

EX-99.1

Exhibit 99.1

USA Truck Has Acquired Privately Held Davis Transfer Company of Carnesville, Georgia

Van Buren, AR – October 18, 2018 – USA Truck, Inc. (NASDAQ: USAK), a leading capacity solutions provider headquartered in Van Buren, AR, today announced that it has acquired privately held Davis Transfer Company and related entities (Davis) of Carnesville, GA.

Davis is a premier, high-service, southeast regional carrier with approximately $50 million in revenues and a recent operating ratio in the upper 80’s. The company was founded by Harry Davis in 1959 and has been a family owned business since that time. Davis has been managed as a full truckload carrier for the past 20 years by Gary, Bill and Todd Davis. Todd will join the USA Truck leadership team as a Vice President. Davis will operate independently of USA Truck as a wholly owned subsidiary. Davis’ employees and customers should notice little change moving forward.

Davis has a reputation as a safe operator, having been named Florida’s Safest Carrier in both 2016 and 2017. The company also has a long history of outstanding service and is a recognized leader by its customers in regional, quasi-dedicated truckload freight.

James Reed, President and CEO of USA Truck said:

“Davis represents a unique opportunity to add capacity, loyal customers, and exceptional drivers – all of whom are committed to the continued strong performance of the business. The Davis family has been a great steward of the organization, with a strong track record of success and profitability, and this partnership reflects the next natural step in the progression and growth of Davis.

“We believe this acquisition gives USA Truck a greater presence in the southeast and provides three key strategic opportunities: increased alignment with driver domiciles, enhanced maintenance facility presence, and financial synergies. We believe there are opportunities to enhance the flow of driver movements into and out of existing markets – which we anticipate will minimize deadhead and enhance capacity availability and service to our customers. We intend to drive improvements to the maintenance cost structure of both USA Truck and Davis by leveraging Davis’ existing terminal infrastructure. Finally, we anticipate the realization of certain financial synergies, especially in the procurement area. We believe these advantages, coupled with what we expect will be a substantially and immediately accretive business, make this acquisition a great fit.”

The transaction will be primarily funded via the company’s revolving credit facility and cash on hand, with a minimal equity issuance provided to Todd Davis to ensure strong alignment with interests of USA Truck shareholders. The post transaction leverage ratio (Net Debt to Adjusted EBITDA) is anticipated to remain within our previously communicated target range of 2.0x to 3.0x.

About USA Truck: USA Truck provides comprehensive capacity solutions to a broad and diverse customer base throughout North America. Our Trucking and USAT Logistics divisions blend an extensive portfolio of asset and asset-light services, offering a balanced approach to supply chain management including customized truckload, dedicated contract carriage, intermodal and third-party logistics freight management services. For more information, visit usa-truck.com or usatlogistics.com.

This press release contains certain statements that may be considered forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and such statements are subject to the safe harbor created by those sections and the Private Securities Litigation Reform Act of 1995, as amended.  Such statements may be identified by their use of terms or phrases such as "expects," "estimates," "projects," "believes," "anticipates," "plans," "intends," “outlook” “will,” “should,” and similar terms and phrases.  Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. In this press release, statements relating to accretion and leverage expectations and timing, cost, revenue, and other synergy opportunities, and future results are all forward-looking statements. The following risks and factors related to the acquisition, among others, could cause actual results to differ materially from those in the forward-looking statements: failing to achieve anticipated synergies, experiencing liabilities that were not disclosed to us or that are in excess of our estimates and potential insufficiency of contractual indemnities in respect thereof, disruption to our ongoing business, including distraction of management and diversion of resources, difficulties in markets that Davis serves, loss of customers, employees, or drivers, potential future impairment charges, write-offs, write-downs, or restructuring charges, failure to achieve anticipated revenue, earnings, or cash flows, inconsistencies in or conflicts between standards, controls, procedures, and policies of the acquired company, failure to maintain or improve the safety or quality of services that have historically been provided, and adverse consequences from the additional indebtedness from the acquisition. Forward-looking statements are based upon the current beliefs and expectations of our management and are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, which could cause future events and actual results to differ materially from those set forth in, contemplated by, or underlying the forward-looking statements. Accordingly, actual results may differ materially from those set forth in the forward-looking statements.  Readers should review and consider the factors that may affect future results and other disclosures by USA Truck in its press releases, stockholder reports, and filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which it is made. USA Truck disclaims any obligation to update or revise any forward-looking statements to reflect actual results or changes in the factors affecting the forward-looking information. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this press release might not occur. All forward-looking statements attributable to USA Truck, or persons acting on our behalf, are expressly qualified in their entirety by this cautionary statement.