Note 8 - Leases and Commitments

9 Months Ended

Sep. 30, 2014

Leases [Abstract]

Leases of Lessee Disclosure [Text Block]

Note 8 –LEASES AND Commitments

CAPITAL LEASES

USA Truck leases certain equipment under capital leases with terms ranging from 15 to 60 months. Balances related to these capitalized leases are included in property and equipment in the accompanying condensed consolidated balance sheets and are set forth in the table below for the periods indicated (in thousands).

	Capitalized Costs		Accumulated Amortization		Net Book Value
September 30, 2014	$	79,118	$	26,742	$	52,376
December 31, 2013		84,410		20,942		63,468

The Company has capitalized lease obligations relating to revenue equipment in the amount of $50.9 million, of which $22.3 million represents the current portion. Such leases have various termination dates extending through August 2018 and contain renewal or fixed price purchase options. The effective interest rates on the leases range from 1.6% to 3.1% as of September 30, 2014. The lease agreements require payment of property taxes, maintenance and operating expenses. The Company has entered into various long-term financing agreements of approximately $0.6 million for the purchases of information technology (“IT”) related hardware which bears imputed interest ranging from 3.1% to 4.5%. Amortization of capital leases was $3.1 million and $9.7 million for the three and nine months ended September 30, 2014, respectively, and $3.5 million and $9.1 million for the three and nine months ended September 30, 2013, respectively.

OPERATING LEASES

Rent expense associated with operating leases was $1.4 million and $3.9 million for the three and nine months ended September 30, 2014, respectively, and $0.5 million and $2.1 million for the three and nine months ended September 30, 2013, respectively. Rent expense relating to tractors, trailers and other operating equipment is included in operations and maintenance expense, while rent expense relating to office equipment is included in other operating expenses in the accompanying condensed consolidated statements of operations and comprehensive income (loss).

As of September 30, 2014, the Company has entered into leases with lessors who do not participate in the Revolver. Currently, such leases do not contain cross-default provisions with the Revolver.

As of September 30, 2014, the future minimum payments under capitalized leases with initial terms of one year or more and future rentals under operating leases for certain facilities, office equipment and revenue equipment with initial terms of one year or more were as follows for the years indicated (in thousands).

	2014		2015		2016		2017		2018		Thereafter
Future minimum payments	$	23,163	$	15,930	$	11,144	$	2,286	$	--	$	--
Future rentals under operating leases		4,555		3,727		3,596		3,457		773		164

OTHER COMMITMENTS

In February 2014, the Board of Directors authorized the use of up to $20.0 million in new capital leases under existing facilities through 2014 and the Company has not utilized any of this authorization as of September 30, 2014. For the remainder of 2014 and 2015, the Company had approximately $0.4 million in commitments for purchases of non-revenue equipment and commitments for purchases of revenue equipment in the amount of approximately $23.1 million. The Company anticipates taking delivery of these purchases throughout the remainder of 2014 and into 2015.

In October 2013, the Executive Compensation Committee of the Board of Directors approved a retention bonus plan (the “Retention Bonus Plan”) and a change in control/severance plan (the “Management Severance Plan”) for certain of the Company’s officers and members of the management team. The Executive Compensation Committee determined that it was appropriate to adopt a Retention Bonus Plan and the Management Severance Plan as a means of assuring the continued focus of the new and expanded management team that is critical to the successful execution of the Company’s turnaround strategy.

On April 11, 2014, each participant in the Retention Bonus Plan, who was employed on October 30, 2013, received a percentage of their annualized base salary, determined as of the date of adoption of the Retention Bonus Plan. Mr. John Simone, President and CEO, received a partial payment of his bonus in December 2013. If a participant in the Retention Bonus Plan voluntarily terminates their employment at any time after receipt of the bonus payment and before the one-year anniversary of the adoption of the Retention Bonus Plan, or October 30, 2014, the plan participant will be required to repay their retention bonus award to the Company.

The Management Severance Plan provides that the plan participants enter into substantially identical Change in Control/Severance Agreements with the Company (each, a “Severance Agreement”) and are entitled to certain severance benefits thereunder if (i) following adoption of the Management Severance Plan, a participant is terminated by the Company without “cause” (as defined in the Severance Agreement) other than in connection with or following a “change in control” (as defined in the Severance Agreement) (the “Severance Benefit”) or (ii) in the event of and for the twelve-month period following a “change in control,” the Company or its successor terminates a participant’s employment without “cause” or the participant is subject to a “constructive termination” (as defined in the Severance Agreement) (the “Change-in-Control Benefit”). The Management Severance Plan provides that the Severance Benefit and the Change-in-Control Benefit are mutually exclusive and a plan participant would not be entitled to both benefits.

With respect to the Severance Benefit, plan participants will be entitled to receive a monthly severance payment equal to the participant’s base monthly salary at the time of termination without “cause” for a fixed period of time ranging from six months to twelve months.

On September 12, 2013, the Company entered into an agreement with a firm to act as its financial advisor in connection with the Company’s response to the unsolicited proposal made by Knight Transportation, Inc., and certain potential strategic and financial alternatives. The agreement contained provisions for us to pay a retainer fee and certain other fees that would become payable upon the consummation of certain events as defined in the agreement. As of September 30, 2014, the Company has fully accrued all such fees.