Polaris 2011 Annual Report Download - page 77

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The following assumptions were used to estimate the weighted average fair value of options of $18.44,
$9.30, and $2.95 granted during the years ended December 31, 2011, 2010, and 2009, respectively:
For the Year
Ended December 31,
2011 2010 2009
Weighted-average volatility .................................. 49% 48% 42%
Expected dividend yield ..................................... 1.9% 3.0% 6.6%
Expected term (in years) .................................... 4.7 5.1 5.7
Weighted average risk free interest rate ......................... 1.4% 2.5% 2.2%
The total intrinsic value of options exercised during the year ended December 31, 2011 was $77,736,000.
The total intrinsic value of options outstanding and exercisable at December 31, 2011, 2010, and 2009 was
$67,466,000, $40,795,000, and $25,962,000, respectively. The total intrinsic value at each of December 31, 2011,
2010 and 2009 is based on the Company’s closing stock price on the last trading day of the applicable year for
in-the-money options.
The following table summarizes restricted stock activity for the year ended December 31, 2011:
Shares
Outstanding
Weighted
Average
Grant Price
Balance as of December 31, 2010 ................. 256,908 $21.44
Granted .................................. 175,340 $42.54
Vested ................................... (8,000) $25.42
Canceled/Forfeited ............................. — —
Balance as of December 31, 2011 ................. 424,248 $30.09
Expected to vest as of December 31, 2011 .......... 424,248 $30.09
The total intrinsic value of restricted stock expected to vest as of December 31, 2011 was $23,749,000. The
total intrinsic value at December 31, 2011 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, 2011, 2010, and 2009 were $42.54, $28.95, and $17.84, respectively.
Employee Savings Plans
Polaris sponsors a qualified non-leveraged employee stock ownership plan (“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. Shares vest immediately 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 $7,011,000, $8,123,000 and $0, in 2011, 2010 and 2009, respectively. As of December 31, 2011 there were
4,659,000 shares vested in the plan.
Polaris sponsors a 401(k) retirement savings plan under which eligible United States employees may choose
to contribute up to 50 percent of eligible compensation on a pre-tax basis, subject to certain IRS limitations. The
Company matches 100 percent of employee contributions up to a maximum of five percent of eligible
compensation. Matching contributions were $8,456,000, $7,073,000, and $6,827,000, in 2011, 2010 and 2009,
respectively.
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