Polaris 2013 Annual Report Download - page 83

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The following table summarizes restricted stock activity for the year ended December 31, 2013:
Weighted
Shares Average
Outstanding Grant Price
Balance as of December 31, 2012 .................. 544,432 $57.15
Granted ................................. 339,249 88.84
Vested .................................. (90,658) 33.70
Canceled/Forfeited .......................... (22,056) 59.87
Balance as of December 31, 2013 .................. 770,967 $74.47
Expected to vest as of December 31, 2013 ............ 664,848 $72.50
The total intrinsic value of restricted stock expected to vest as of December 31, 2013 was $96,828,000. The
total intrinsic value is based on the Company’s closing stock price on the last trading day of the year. The
weighted average fair values at the grant dates of grants awarded under the Restricted Stock Plan for the
years ended December 31, 2013, 2012, and 2011 were $88.84, $70.12, and $42.54, respectively.
Note 3. Employee Savings Plans
Employee Stock Ownership Plan (ESOP). Polaris sponsors a qualified non-leveraged ESOP under which a
maximum of 7,200,000 shares of common stock can be awarded. The shares are allocated to eligible
participants accounts based on total cash compensation earned during the calendar year. An employee’s ESOP
account vests equally after two and three years of service and require no cash payments from the recipient.
Participants may instruct Polaris to pay respective dividends directly to the participant in cash or reinvest the
dividends into the participants ESOP accounts. Substantially all employees are eligible to participate in the
ESOP, with the exception of Company officers. Total expense related to the ESOP was $9,224,000, $7,380,000,
and $7,011,000, in 2013, 2012 and 2011, respectively. As of December 31, 2013 there were 4,142,000 shares
vested in the plan.
Defined contribution plans. Polaris sponsors various defined contribution retirement plans covering substantially
all U.S. employees. For the 401(k) defined contribution retirement plan which covers the majority of U.S.
employees, the Company matches 100 percent of employee contributions up to a maximum of five percent of
eligible compensation. All contributions vest immediately. The cost of these defined contribution retirement
plans was $10,651,000, $9,318,000, and $8,456,000, in 2013, 2012 and 2011, respectively.
Supplemental Executive Retirement Plan (SERP). Polaris sponsors a SERP that provides executive officers of
the Company an alternative to defer portions of their salary, cash incentive compensation, and Polaris
matching contributions. The deferrals and contributions are held in a rabbi trust and are in funds to match
the liabilities of the plan. The assets are recorded as trading assets. The assets of the rabbi trust are included
in other long-term assets on the consolidated balance sheets and the SERP liability is included in other long-
term liabilities on the consolidated balance sheets. The asset and liability balance are both $24,711,000 and
$15,872,000 at December 31, 2013, and 2012, respectively.
In November 2013, Polaris amended the SERP to allow executive officers of the Company the opportunity to
defer restricted stock awards beginning with the annual performance-based award, which is scheduled to vest
in February 2015 if certain performance metrics are achieved. After a holding period, the executive officer has
the option to diversify the vested award into other funds available under the SERP. The deferrals will be held
in a rabbi trust and will be invested in funds to match the liabilities of the SERP. The awards are redeemable
in Polaris stock or in cash based upon the occurrence of events not solely within the control of Polaris;
therefore, awards probable of vesting, for which the executive has not yet made an election to defer, or
awards that have been deferred but have not yet vested and are probable of vesting or have been diversified
into other funds are reported as deferred compensation in the temporary equity section of the consolidated
balance sheets. The awards recorded in temporary equity are recognized at fair value as though the reporting
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