Harley Davidson 2015 Annual Report Download - page 91

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91
During 2015, the Company repurchased 28.0 million shares of its common stock at a weighted-average price of $55. This
includes 0.2 million shares of common stock that were repurchased from employees that surrendered stock to satisfy
withholding taxes in connection with the vesting of restricted stock awards. The remaining repurchases were made pursuant to
the following authorizations (in millions of shares):
Shares Repurchased Authorization Remaining
at December 31, 2015
Board of Directors’ Authorization 2015 2014 2013
1997 Authorization 0.9 3.2 — —
2007 Authorization 0.9 5.8 7.7 —
2014 Authorization 20.0 — — —
2015 Authorization 6.0 — — 9.0
Total 27.8 9.0 7.7 9.0
1997 Authorization – The Company has an authorization from its Board of Directors (originally adopted December 1997)
to repurchase shares of its outstanding common stock under which the cumulative number of shares repurchased, at the time of
any repurchase, shall not exceed the sum of (1) the number of shares issued in connection with the exercise of stock options
occurring on or after January 1, 2004, plus (2) 1% of the issued and outstanding common stock of the Company on January 1 of
the current year, adjusted for any stock split.
2007 Authorization – In December 2007, the Company’s Board of Directors separately authorized the Company to buy
back up to 20.0 million shares of its common stock with no dollar limit or expiration date.
2014 Authorization – In February 2014, the Company’s Board of Directors separately authorized the Company to buy
back up to 20.0 million shares of its common stock with no dollar limit or expiration date.
2015 Authorization – In June 2015, the Company’s Board of Directors separately authorized the Company to buy back up
to 15.0 million shares of its common stock with no dollar limit or expiration date.
Preferred Stock:
The Company is authorized to issue 2,000,000 shares of preferred stock of $1.00 par value, none of which is outstanding.
17. Share-Based Awards
The Company has a share-based compensation plan which was approved by its Shareholders in April 2014 (Plan) under
which the Board of Directors may grant to employees share-based awards including nonqualified stock options, stock
appreciation rights (SARs), shares of restricted stock and restricted stock units (RSUs). The options and SARs granted under
the Plan have an exercise price equal to the fair market value of the underlying stock at the date of grant vest ratably over a
three-year period with the first one-third of the grant becoming exercisable one year after the date of grant. The options and
SARs expire 10 years from the date of grant. Shares of restricted stock and RSUs granted under the Plan vest ratably over a
three-year period with the first one-third of the grant vesting one year after the date of grant. Dividends are paid on shares of
restricted stock and dividend equivalents are paid on RSUs. At December 31, 2015, there were 8.3 million shares of common
stock available for future awards under the Plan.
Stock Options:
The Company estimates the grant date fair value of its option awards granted using a lattice-based option valuation
model. The Company believes that the lattice-based option valuation model provides a more precise estimate of fair value than
the Black-Scholes option pricing model. Lattice-based option valuation models utilize ranges of assumptions over the expected
term of the options. Prior to 2013, the Company used a weighted-average of implied and historical volatility to determine the
expected volatility of its stock. Beginning with awards granted in 2013, the Company uses implied volatility to determine the
expected volatility of its stock. The Company uses historical data to estimate option exercise and employee termination within
the valuation model. The expected term of options granted is derived from the output of the option valuation model and
represents the average period of time that options granted are expected to be outstanding. The risk-free rate for periods within
the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.