Polaris 2011 Annual Report Download - page 82

and retire approximately 2,608,000 shares. During 2010 Polaris paid $27,486,000 to repurchase and retire
approximately 1,202,000 shares and in 2009 Polaris paid $4,556,000 to repurchase and retire approximately
222,000 shares.
Shareholder rights plan: During 2000, the Polaris Board of Directors adopted a shareholder rights plan.
Under the plan, a dividend of preferred stock purchase rights will become exercisable if a person or group should
acquire 15 percent or more of the Company’s stock. The dividend will consist of one purchase right for each
outstanding share of the Company’s common stock held by shareholders of record on June 1, 2000. The
shareholder rights plan was amended and restated in April 2010. The amended and restated rights agreement
extended the final expiration date of the rights from May 2010 to April 2020, expanded the definition of
“Beneficial Owner” to include certain derivative securities relating to the common stock of the Company and
increased the purchase price for the rights from $75 to $125 per share. The Board of Directors may redeem the
rights earlier for $0.01 per right.
Accumulated other comprehensive income: Accumulated other comprehensive income consisted of
$9,545,000 and $6,991,000 of unrealized currency translation gains (net of tax of $1,516,000 and $8,298,000) as
of December 31, 2011 and 2010, respectively, and unrealized gains of $2,478,000 and unrealized losses of
$1,093,000 (net of tax liability of $1,474,000 and tax benefit of $650,000) related to derivative instruments as of
December 31, 2011 and 2010, respectively.
Changes in the Accumulated other comprehensive income (loss) balances is as follows (in thousands):
Foreign
Currency
Items
Unrealized Gains
(Losses) on
Securities
Net Gains (Losses)
on Cash Flow
Hedging Derivatives
Accumulated Other
Comprehensive
Income
Balance at December 31, 2010 ....... $6,991 — $(1,093) $ 5,898
Reclassification to the income
statement ...................... — — (959) (959)
Change in fair value ............... 2,554 — 4,530 7,084
Balance at December 31, 2011 ....... $9,545 — $ 2,478 $12,023
Net income per share: Basic earnings per share is computed by dividing net income available to common
shareholders by the weighted average number of common shares outstanding during each year, including shares
earned under the Director Plan, ESOP and deferred stock units under the Omnibus Plan. Diluted earnings per
share is computed under the treasury stock method and is calculated to compute the dilutive effect of outstanding
stock options and certain shares issued under the Restricted Plan and Omnibus Plan. A reconciliation of these
amounts is as follows (in thousands):
2011 2010 2009
Weighted average number of common shares outstanding ........ 68,315 66,318 64,490
Director Plan and Deferred stock units ....................... 342 326 308
ESOP ................................................. 135 256 —
Common shares outstanding—basic ......................... 68,792 66,900 64,798
Dilutive effect of Restricted Plan and Omnibus Plan ............ 165 132 530
Dilutive effect of Option Plan and Omnibus Plan ............... 2,100 1,733 820
Common and potential common shares outstanding—diluted ..... 71,057 68,765 66,148
During 2011, 2010 and 2009, the number of options that could potentially dilute earnings per share on a
fully diluted basis that were not included in the computation of diluted earnings per share because to do so would
have been anti-dilutive was 131,000, 788,000, and 3,344,000, respectively.
66