Polaris 2015 Annual Report Download - page 84

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The weighted average remaining contractual life of options outstanding and of options outstanding and
exercisable as of December 31, 2015 was 6.57 years and 5.08 years, respectively.
The following assumptions were used to estimate the weighted average fair value of options of $37.64, $39.97
and $30.43 granted during the years ended December 31, 2015, 2014 and 2013, respectively:
For the Years Ended
December 31,
2015 2014 2013
Weighted-average volatility .................................. 32% 40% 49%
Expected dividend yield .................................... 1.4% 1.5% 1.9%
Expected term (in years) ................................... 4.5 4.5 4.4
Weighted average risk free interest rate ......................... 1.5% 1.6% 0.9%
The total intrinsic value of options exercised during the year ended December 31, 2015 was $77,951,000. The
total intrinsic value of options outstanding and of options outstanding and exercisable at December 31, 2015,
was $82,276,000 and $77,110,000, respectively. The total intrinsic values are 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, 2015:
Weighted
Shares Average
Outstanding Grant Price
Balance as of December 31, 2014 .................. 1,077,731 $ 98.15
Granted ................................... 476,556 139.50
Vested .................................... (358,966) 72.56
Canceled/Forfeited ........................... (64,554) 126.64
Balance as of December 31, 2015 .................. 1,130,767 $122.08
Expected to vest as of December 31, 2015 ............ 765,271 $121.25
The total intrinsic value of restricted stock expected to vest as of December 31, 2015 was $65,775,000. 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 Omnibus Plan for the years ended
December 31, 2015, 2014 and 2013 were $139.50, $134.34 and $88.84, 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 requires 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 $7,455,000, $10,789,000
and $9,224,000, in 2015, 2014 and 2013, respectively. As of December 31, 2015 there were 3,847,000 shares
held 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 $14,178,000, $12,486,000, and $10,651,000, in 2015, 2014 and 2013, respectively.
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