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Note 11 - Share Based Compensation and Employee Benefit Plans | 12 Months Ended
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Dec. 31, 2017
Notes to Financial Statements |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] |
1 1. | SHARE BASED COMPENSATION AND EMPLOYEE BENEFIT PLANS :
Employee Stock Purchase Plan The Company ’s 2004 Employee Stock Purchase Plan, as amended and restated (the “Employee Stock Purchase Plan”) allows eligible employees to contribute up to $10,625 of their base earnings every six months toward the semi-annual purchase of the Company’s Class A Common Stock. The employee’s purchase price is 85% of the lesser of the closing price of the Class A Common Stock on the first business day or the last business day of the semi-annual offering period, as reported by The NASDAQ Global Select Market. Employees may purchase shares having a fair market value of up to $25,000 (measured as of the first day of each semi-annual offering period) for each calendar year. On May 17, 2016, the Company’s shareholders approved the amendment and restatement of the Employee Stock Purchase Plan to increase the number of shares of Class A Common Stock authorized for issuance thereunder by 500,000 shares. Under the Employee Stock Purchase Plan, there are approximately 415,000 shares remaining of the 1,400,000 shares of the Company’s Class A Common Stock that have been reserved for issuance. The Company issued 112,754 shares under the Employee Stock Purchase Plan during the year ended December 31, 2017 and 137,360 shares during the year ended December 31, 2016. Of the 6,825 employees eligible to participate, approximately 1,131 elected to participate in the plan as of December 31, 2017. Non-Employee Director Stock Option Plan On May 16, 2006, t he Board of Directors and shareholders adopted the Rush Enterprises, Inc. 2006 Non-Employee Director Stock Option Plan (the “Director Plan”), reserving 1,500,000 shares of Class A Common Stock for issuance upon exercise of any awards granted under the plan. This Director Plan was Amended and Restated on May 20, 2008 to expand the type of awards that may be granted under the plan to include Class A Common Stock awards. The Director Plan was also amended on May 18, 2010 to reduce the number of shares reserved for issuance under the plan by 1,000,000 shares of Class A Common Stock. The Director Plan is designed to attract and retain highly qualified non-employee directors. Currently, each non-employee director receives a grant of the Company’s Class A Common Stock, or up to 40% cash, equivalent to a compensation value of $125,000. In 2016, two non-employee directors received a grant of 6,145 shares of the Company’s Class A Common Stock and four non-employee director received a grant of 3,687 shares of the Company’s Class A Common Stock and $50,000 cash, for total compensation equivalent to $125,000 each. In 2017, two non-employee directors received a grant of 3,307 shares of the Company’s Class A Common Stock, one non-employee director received a grant of 1,984 shares of the Company’s Class A Common Stock and $50,000 cash, one non-employee director received a grant of 2,315 shares of the Company’s Class A Common Stock and $37,500 cash, and one non-employee director received a grant of 2,480 shares of the Company’s Class A Common Stock and $31,250 cash, for total compensation equivalent to $125,000 each. Under the Director Plan, there are approximately 152,000 shares remaining for issuance of the 500,000 shares of the Company’s Class A Common Stock that have been reserved for issuance. The Company granted 13,393 shares of Class A Common Stock under the Director Plan during the year ended December 31, 2017 and 27,038 shares of Class A Common Stock under the Director Plan during the year ended December 31, 2016. Employee Incentive Plans In May 2007, the Board of Directors and shareholders adopted the Rush Enterprises, Inc. 2007 Long-Term Incentive Plan (the “2007 Incentive Plan”). The 2007 Incentive Plan provides for the grant of stock options (which may be nonqualified stock options or incentive stock options for tax purposes), stock appreciation rights issued independent of or in tandem with such options (“SARs”), restricted stock awards and performance awards. The 2007 Incentive Plan was amended and restated on May 20, 2014 and again on May 16, 2017 to increase the number of shares available for issuance under the plan to 7,800,000 shares of Class A Common Stock and 2,200,000 shares of Class B Common Stock. The aggregate number of shares of common stock subject to stock options or SARs that may be granted to any one participant in any year under the 2007 Incentive Plan is 100,000 shares of Class A Common Stock or 100,000 shares of Class B Common Stock. Each option granted pursuant to the 2007 Incentive Plan has a ten year term from the grant date and vests in three equal annual installments beginning on the third anniversary of the grant date. The Company has 7,800,000 shares of Class A Common Stock and 2,200,000 shares of Class B Common Stock reserved for issuance upon exercise of any awards granted under the Company’s 2007 Incentive Plan. As of December 31, 2017, approximately 2,142,000 shares of Class A Common Stock and 1,063,000 shares of Class B Common Stock are available for issuance upon the exercise of any awards granted under the Company’s 2007 Incentive Plan. The Company issues new shares of its Class A or Class B Common Stock upon the exercise of stock options or vesting of restricted stock units. During the year ended December 31, 2017, the Company granted 472,463 options to purchase Class A Common Stock and 274,390 restricted Class B Common Stock units under the 2007 Incentive Plan. During the year ended December 31, 2016, the Company granted 493,088 options to purchase Class A Common Stock and 268,890 restricted Class B Common Stock units under the 2007 Incentive Plan. Valuation and Expense Information Stock-based compensation expense related to stock options , restricted stock awards, restricted stock units and employee stock purchases was $15.6 million for the year ended December 31, 2017, $12.9 million for the year ended December 31, 2016, and $12.4 million for the year ended December 31, 2015. C ash received from options exercised and shares purchased under all share-based payment arrangements was $24.8 million for the year ended December 31, 2017, $6.5 million for the year ended December 31, 2016, and $4.3 million for the year ended December 31, 2015. A summary of the Company ’s stock option activity and related information for the year ended December 31, 2017, follows:
|  |  |  |  |  |  |  |  |  | Weighted |  |  |  |  |
|  |  |  |  |  | Weighted |  |  | Average |  |  |  |  |
|  |  |  |  |  | Average |  |  | Remaining |  |  | Aggregate |
|  |  |  |  |  | Exercise |  |  | Contractual |  |  | Intrinsic |
Options |  | Shares |  |  | Price |  |  | Life (in Years) |  |  | Value |
Balance of Outstanding Options at January 1, 2017 |  |  | 3,489,826 |  |  | $ | 21.42 |  |  |  |  |  |  |  |  |
Granted |  |  | 472,463 |  |  |  | 33.89 |  |  |  |  |  |  |  |  |
Exercised |  |  | (1,205,281 | ) |  |  | 18.56 |  |  |  |  |  |  |  |  |
Forfeited |  |  | (32,700 | ) |  |  | 27.05 |  |  |  |  |  |  |  |  |
Balance of Outstanding Options at December 31, 2017 |  |  | 2,724,308 |  |  | $ | 24.78 |  |  |  | 6.43 |  |  | $ | 70,910,167 |
Expected to vest a fter December 31, 2017 |  |  | 1,784,417 |  |  | $ | 26.74 |  |  |  | 7.68 |  |  | $ | 42,945,946 |
Vested and exercisable at December 31, 2017 |  |  | 888,246 |  |  | $ | 20.75 |  |  |  | 3.85 |  |  | $ | 26,701,699 |
The aggregate intrinsic value in the preceding table represents the total pretax intrinsic value, based on the weighted-average of the closing price as of December 29, 2017, of the Company’s Class A common of $50.81. The total intrinsic value of options exercised was $25.0 million during the year ended December 31, 2017, $4.8 million during the year ended December 31, 2016, and $2.6 million during the year ended December 31, 2015. A summary of the status of the number of shares underlying Company’s non-vested stock options as of December 31, 2017, and changes during the year ended December 31, 2017, is as follows:
|  |  |  |  |  | Weighted |
|  |  |  |  |  | Average |
|  | Number of |  |  | Grant Date |
Non-vested Shares |  | Shares |  |  | Fair Value |
Non-vested at January 1, 2017 |  |  | 1,881,578 |  |  | $ | 11.28 |
Granted |  |  | 472,463 |  |  |  | 12.33 |
Vested |  |  | (485,279 | ) |  |  | 12.92 |
Forfeited |  |  | (32,700 | ) |  |  | 11.07 |
Non-vested at December 31, 201 7 |  |  | 1,836,062 |  |  | $ | 11.12 |
The total fair value of vested options was $6.3 million during the year ended December 31, 2017, $5.6 million during the year ended December 31, 2016, and $5.1 million during the year ended December 31, 2015. The weighted-average grant date fair value of options granted was $12.33 per share during the year ended December 31, 2017, $6.54 per share during the year ended December 31, 2016, and $11.27 per share during the year ended December 31, 2015. Stock Awards The Company granted restricted stock units to certain of its employees under the 2007 Incentive Plan and unrestricted stock awards to its non-employee directors under the Director Plan during the year ended December 31, 2017. The restricted stock units granted to employees vest in three equal installments on the first, second and third anniversary of the grant date and are forfeited in the event the recipient’s employment or relationship with the Company is terminated prior to vesting, except as a result of retirement or under certain circumstances associated with a change of control or involuntary termination, as further described in the Company’s executive transition plan. The fair value of the restricted stock units to the Company’s employees is amortized to expense on a straight-line basis over the restricted stock’s vesting period. The shares granted to non-employee directors are expensed on the grant date. T he following table presents a summary of the Company’s non-vested restricted stock units outstanding at December 31, 2017:
|  |  |  |  |  | Weighted |  |  |  |  |  |  |  |  |
|  |  |  |  |  | Average |  |  |  |  |  |  | Weighted |
|  |  |  |  |  | Remaining |  |  | Aggregate |  |  | Average |
|  |  |  |  |  | Contractual |  |  | Intrinsic |  |  | Grant Date |
Stock Awards and Units |  | Shares |  |  | Life (in Years) |  |  | Value |  |  | Fair Value |
Outstanding non-vested shares at January 1, 2017 |  |  | 519,173 |  |  |  |  |  |  |  |  |  |  | $ | 21.21 |
Granted |  |  | 274,390 |  |  |  |  |  |  |  |  |  |  |  | 31.37 |
Vested |  |  | (253,431 | ) |  |  |  |  |  |  |  |  |  |  | 22.64 |
Forfeited |  |  | − |  |  |  |  |  |  |  |  |  |  |  | − |
Outstanding non-vested at December 31, 2017 |  |  | 540,132 |  |  |  | 8.5 |  |  | $ | 26,043,230 |  |  | $ | 25.71 |
Expected to vest after December 31, 201 7 |  |  | 538,462 |  |  |  | 8.5 |  |  | $ | 25,962,706 |  |  |  |  |
The total fair value of the shares issued upon the vesting of stock awards during the year ended December 31, 2017 was $5.7 million. The weighted-average grant date fair value of stock awards and units granted was $31.37 per share during the year ended December 31, 2017, $17.57 per share during the year ended December 31, 2016, and $24.75 per share during the year ended December 31, 2015. As of December 31, 20 17, there was $13.4 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under the 2007 Incentive Plan. That cost is expected to be recognized over a weighted-average period of 2.4 years. Defined Contribution Plan The Company has a defined contribution plan (the “Rush 401 k Plan”), which is available to all Company employees. Each employee who has completed 30 days of continuous service is entitled to enter the Rush 401k Plan on the first day of the following month. Participating employees may contribute from 1% to 50% of total gross compensation. However, certain highly compensated employees are limited to a maximum contribution of 15% of total gross compensation. For the first 10% of an employee’s contribution, the Company contributes an amount equal to 20% of the employees’ contributions for those employees with less than five years of service and an amount equal to 40% of the employees’ contributions for those employees with more than five years of service. The Company incurred expenses related to the Rush 401k Plan of approximately $7.0 million during the year ended December 31, 2017, $6.5 million during the year ended December 31, 2016, and $6.2 million during the year ended December 31, 2015. Deferred Compensation Plan On November 6, 2010, the Board of Directors of the Company adopted the Rush Enterprises, Inc. Deferred Compensation Plan (the “Deferred Compensation Plan”) pursuant to which selected employees and directors may elect to defer a portion of their annual compensation. The Deferred Compensation Plan also provides the Company with the discretion to make matching contributions to participants’ accounts. The Company established a rabbi trust to finance obligations under the Deferred Compensation Plan with corporate-owned variable life insurance contracts. Participants are 100% vested in their respective deferrals and the earnings thereon. The first deferral election period began on January 1, 2011. The Company’s liability related to the Deferred Compensation Plan was $9.8 million on December 31, 2017 and $7.2 million on December 31, 2016. The related cash surrender value of the life insurance contracts was $9.6 million on December 31, 2017 and $6.8 million on December 31, 2016. The Company currently does not provide any post -retirement benefits nor does it provide any post-employment benefits.

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- Definition The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 718 -URI http://asc.fasb.org/topic&trid=2228938 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 50 -URI http://asc.fasb.org/subtopic&trid=2208855 + Details
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