10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

x Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the fiscal year ended March 31, 2016

or

¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition period from              to             

Commission File Number: 0-18607

ARCTIC CAT INC.

(Exact name of registrant as specified in its charter)

Minnesota	41-1443470
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
505 Highway 169 North, Suite 1000 Plymouth, Minnesota	55441
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:

(763) 354-1800

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock, $0.01 par value	The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ¨    No  x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act.    Yes  ¨    No  x

Indicate by check mark whether the registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.    ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ¨	Accelerated filer                  x
Non-accelerated filer   ¨	Smaller reporting company ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold as of the last business day of the registrant’s most recently completed second fiscal quarter was approximately $287,993,615.

At May 20, 2016, the registrant had 13,052,843 shares of Common Stock outstanding.

Documents Incorporated by Reference:

Portions of the registrant’s Proxy Statement for its Annual Meeting of Shareholders currently scheduled to be held on July 25, 2016 are incorporated by reference into Part III of this Annual Report on Form 10-K.

ARCTIC CAT INC.

FORM 10-K

TABLE OF CONTENTS

PART I		1
ITEM 1.	Business	1
ITEM 1A.	Risk Factors	9
ITEM 1B.	Unresolved Staff Comments	13
ITEM 2.	Properties	13
ITEM 3.	Legal Proceedings	13
ITEM 4.	Mine Safety Disclosures	13
PART II		14
ITEM 5.	Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	14
ITEM 6.	Selected Financial Data	16
ITEM 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
ITEM 7A.	Quantitative and Qualitative Disclosures about Market Risk	27
ITEM 8.	Financial Statements and Supplementary Data	28
ITEM 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	57
ITEM 9A.	Controls and Procedures	57
ITEM 9B.	Other Information	57
PART III		59
ITEM 10.	Directors, Executive Officers and Corporate Governance	59
ITEM 11.	Executive Compensation	59
ITEM 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	59
ITEM 13.	Certain Relationships and Related Transactions, and Director Independence	59
ITEM 14.	Principal Accounting Fees and Services	59
PART IV		60
ITEM 15.	Exhibits, Financial Statements Schedules	60
SIGNATURES		64

PART I

ITEM 1. BUSINESS

Arctic Cat Inc. (“Arctic Cat,” or “we,” “our” or “us”) is a Minnesota corporation with principal executive offices in Plymouth, Minnesota. We design, engineer, manufacture and market snowmobiles and all-terrain vehicles (“ATVs”) and recreational off-highway vehicles (“side-by-sides” or “ROVs”), as well as related parts, garments and accessories (“PG&A”) under the Arctic Cat^® and MotorFist^® brand names. We market our products through a network of independent dealers located throughout the United States, Canada, and Europe and through distributors representing dealers in Europe, Russia, South America, the Middle East, China, Asia and other international markets. The Arctic Cat brand name has existed for more than 50 years and is among the most widely recognized and respected names in the snowmobile, ATV and side-by-side industries. We were incorporated in 1982. Our common stock trades on the NASDAQ Global Select Market under the symbol ACAT.

Industry Background

Snowmobiles—The snowmobile, developed in the 1950s, was originally intended to be used as a utility vehicle, but today the overwhelming majority of the industry’s sales are for recreational use. Between the late 1950s and early 1970s, the industry expanded dramatically, reaching a peak of over 100 manufacturers and a high of nearly 495,000 units sold to retail customers in North America in 1971. Today the industry has consolidated to four major participants: Arctic Cat, BRP Inc. (“BRP”), Polaris Industries Inc. (“Polaris”) and Yamaha Motor Co., Ltd. (“Yamaha”). We believe there are currently more significant barriers to entry into the snowmobile market than existed in the 1970s. These barriers include increased brand loyalty, long-standing dealer and distributor networks and relationships, emissions and safety regulations, four-stroke engine development costs, manufacturing and engineering expertise and higher initial start-up costs. We estimate that industry-wide snowmobile sales to retail customers in North America were approximately 101,500 units for the 2016 model year. Arctic Cat snowmobiles are sold in numerous markets including the United States, Canada, Scandinavia, Russia and other international markets.

ATVs—The ATV industry evolved from the three-wheel model that was developed in the early 1970s to the four-wheel models that are sold today. The most popular ATV use is general recreation, followed by farming/ranching, hunting/fishing, hauling/towing, transportation, and commercial use. From 1970 to 1986, the number of ATVs sold in the United States continued to grow until reaching an initial peak of 535,000 units in 1986. From 1987 to 1991, the number of ATVs sold declined to a low of approximately 147,000 units. From 1991 to 2004, sales of ATVs by Arctic Cat and its major competitors grew to 814,000 units; however, ATV sales declined each year from 2005 to 2011, primarily driven by overall weak economic conditions and the shift to side-by-side vehicles. In 2012, the industry started to turn around and experienced a 2.6% increase in sales, its first increase in industry sales since 2005. For the 2015 calendar year, we estimate that industry-wide sales were 281,000 units in North America, which was essentially flat compared to the prior year. ATVs are sold in numerous markets including the United States, Canada, Europe, Russia, Australia, China, the Middle East and Latin America. Major competitors in the industry include Yamaha, BRP, Polaris, Honda Motor Co., Ltd. (“Honda”), Kawasaki Motors Corp. (“Kawasaki”) and Suzuki Motor Corporation (“Suzuki”). In addition to these companies, multiple other companies, including numerous Chinese and Taiwanese manufacturers, sell ATVs.

ROVs—ROVs are multiple passenger off-highway all-terrain vehicles and, like ATVs, are used for general recreation, farming/ranching, hunting/fishing, hauling/towing, transportation, commercial and military use. We estimate that calendar year 2015 industry side-by-side vehicle retail sales in North America were 286,000 units, up 7.8% from the previous year. The main competitors for our side-by-side vehicles are Yamaha, BRP, Polaris, Kawasaki, Kubota, Deere & Company (“Deere”) and Honda.

Products

Snowmobiles—We produce a full line of snowmobiles, consisting of 60 models, marketed under the Arctic Cat brand name and designed to satisfy most market segments. The current Arctic Cat models carry suggested

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U.S. retail prices ranging from $7,099 to $16,899, excluding a youth model sold at a suggested U.S. retail price of $2,749. Our current model year snowmobiles are categorized as Trail, Crossover, Mountain, Touring and Utility. We market: Trail models under the names ZR and Lynx; Crossover models under the name XF; Mountain models under the name M; Touring models under the name Pantera and Lynx; and Utility models under the name Bearcat. In addition, to encourage family involvement in snowmobiling, we offer a youth snowmobile marketed under the ZR 120 name.

In the more than 50 years of Arctic Cat snowmobiles, the basic framework of the snowmobile has stayed the same: two skis, an engine and drive system and a suspended chassis that supports the rider. Yet there has been a progression in performance, comfort, durability and capability achieved through a half century of innovative engineering and development.

Snowmobiles have advanced from 12-mph rear-engine farm implements to turbo-charged 4-stroke performance machines with advanced bump-soaking suspensions, electric heated seats, 150-mile fuel ranges and the ability to climb tall mountains.

In the sport of snowmobiling, where the customer demands continuous improvement in the vehicle’s ride, quality and performance, companies must progress through innovation. We believe we have a team of talented, driven-to-win people whose passion for snowmobiles is matched by their desire to innovate and improve, a major reason why Arctic Cat has delivered an array of innovative, pioneering technology and products during the last half-century.

For the last three fiscal years ended March 31, 2016, 2015 and 2014, snowmobiles accounted for 41%, 43% and 39%, respectively, of our net sales.

ATVs—In December 1995, we introduced our first ATV. Since that time, our ATV line has grown to 28 models. Features like fully independent front and rear suspensions, hydraulic disc brakes, hi-low range transmission, long travel suspension with high ground clearance, Speed Point accessory systems, automatic transmissions, selectable 2WD/4WD shaft drives, locking differentials, EFI, a large fuel tank, and electronic power steering all make our ATVs consumer friendly. We also have special two rider models that provide a proper alternative for customers that want to ride double on an ATV. In 2007, we introduced the industry’s first diesel ATV, capable of using biodiesel fuels, and in 2008 we introduced the Thundercat 1000, the ATV with the largest displacement engine in the industry. We launched our new value line-up of ATVs in 2011, which included the 350 4X4 automatic and the 425 EFI 4X4 automatic. For model year 2013, we launched a new range of value models which included a 400 4X4 automatic ATV, 450 EFI 4X4 automatic ATV, 500 EFI 4X4 automatic ATV, 400 4X4 automatic TRV and 500 EFI 4X4 automatic TRV. For model year 2015, we launched XR ATV series available in 550cc and 700 cc categories. The current model year Arctic Cat ATVs carry suggested U.S. retail prices ranging from $4,299 to $14,399, excluding youth models which are sold at suggested U.S. retail prices ranging from $2,899 to $3,799.

ROVs—We introduced our Prowler utility side-by-side vehicle into the utility segment in 2006. The Prowler is configured with a variety of different engines that range in size from 550cc to 1000cc that are manufactured by us, and also includes a rear cargo box, dual bucket seats as well as our renowned long travel suspension and ride characteristics. In 2011, we launched our first heavy duty utility side-by-side vehicle, the Prowler HDX, with additional standard features such as an extended chassis, extra-large cargo box, bench seating and electronic power steering. In fiscal 2012, we introduced the all-new Wildcat 1000 sport model ROV. This model is aimed at a rapidly growing segment of the ROV market where consumers are seeking a side-by-side designed vehicle that offers comfort and handling in rough off-highway terrain. In fiscal 2013, we expanded our Wildcat line-up to include a Wildcat 1000 Limited with factory installed accessories, a Wildcat 4 1000, which allows for seating of 4 full sized adults and a Wildcat X 1000, which increases the horse power to +90. In fiscal 2014, we further expanded the Wildcat line-up to include a Wildcat X 1000 Limited, Wildcat 4X 1000 and Wildcat 4X 1000 Limited, all with the high horsepower X engine. We also launched a narrower 50-inch wide, trail-legal platform that allows riders access to authorized ATV trails. In addition to its trail legal capabilities, the

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Wildcat Trail offers industry-leading suspension, coupled with the lowest price in the 50-plus horsepower segment. We also expanded our HDX utility line-up to include a Prowler HDX 500, which has many of the same features as the Prowler 700 HDX, only with a smaller engine. Finally, we introduced the new Wildcat Sport which is 60 inches wide and is positioned to compete in the mid-size Pure Sport and Sport/Recreation segments. Currently, we offer a total of 19 models with retail prices between $9,499 and $20,999. Side-by-side/ROV sales are included with ATV sales for financial reporting purposes.

We build side-by-side utility models for the Toro Company pursuant to a multi-year agreement, which features two models branded separately under both the Toro and eXmark brands and was rolled out in the fourth quarter of fiscal year 2015 and continued throughout fiscal year 2016.

For the last three fiscal years ended March 31, 2016, 2015 and 2014, ATVs and ROVs collectively accounted for 44%, 41%, and 45%, respectively, of our net sales.

International Markets—We have continued to expand into international markets by focusing on new product development, adding new distributors and dealers, entering new geographies, and developing new markets. In July 2005, we acquired a 100% interest in a European company to strengthen our European presence and further expand our ATV model offerings for on-road use, the most prevalent use in Europe. Our snowmobiles and ATVs are currently sold in all major markets.

Parts, Garments and Accessories—We are the exclusive provider of genuine Arctic Cat Snowmobile, ATV and ROV parts, garments and accessories. Replacement parts for our current and noncurrent models of Snowmobiles, ATVs and ROVs are an important part of our product mix along with maintenance supplies such as oil and fuel additives. We also sell a broad array of accessories such as bumpers, cabs, luggage racks, lights, snow plows, backrests, windshields, wheels, track systems and winch kits that consumers buy to increase their comfort factor, shorten their task or personalize their ride. In addition to genuine Arctic Cat parts and accessories, we sell market leading brands in various categories such as Fox Float shocks, Speed point attachments and BCA Float Avalanche Airbags.

We offer a full range of snowmobile garments for adults and children under the “Arcticwear” brand. Jackets, coats, pants and casual sportswear items are produced and sold in a wide variety of styles and sizes combining fashion with function. The Arcticwear line of clothing encompasses wearables designed to keep the rider warm and dry during the most demanding snowmobile conditions (insulated outerwear, hats, mittens, helmets, boots) and comfortable relaxing after the ride (sweatshirts, T-shirts, casual wear). The snowmobile garment line includes multiple options with varying levels of performance (insulation warmth, waterproofing, breathability)—to answer consumers’ needs across a broad range of weather conditions. Over the last few years we have added more general outerwear options to the Arcticwear line (down filled parkas) and expanded our sportswear wearables sold under the “Arcticwear” brand.

In fiscal year 2015, we acquired substantially all of the assets of MotorFist, LLC, a privately owned company based in Idaho Falls, Idaho, that designs, develops and distributes technical snowmobile riding garments and accessories. Founded in 2009, MotorFist does business throughout North America, as well as Russia, Sweden, Norway, Finland, Japan, Iceland, and Greenland. MotorFist’s products are engineered with its proprietary eVent^® waterproof, windproof and breathable fabric, delivering rugged solutions for harsh conditions. After only a few years of manufacturing, the MotorFist brand has set a high benchmark for premium snowmobile gear.

For ATV and ROV riders, we manufacture and sell garments under the “Arcticwear ATV Gear” label. This line of clothing is geared toward function and comfort and includes suits, jackets, gloves, helmets, gear bags, sweatshirts, T-shirts and hats. The trend to “wear what you ride” continues to be much stronger with snowmobile consumers than with ATV and ROV consumers. We continue to successfully expand our ATV and ROV clothing lines with more performance-geared clothing to provide more rider comfort.

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For the last three fiscal years ended March 31, 2016, 2015 and 2014, parts, garments and accessories accounted for 15%, 16%, and 16%, respectively, of our net sales.

Manufacturing, Engineering and Research and Development

Arctic Cat snowmobiles, ROVs and most ATVs are manufactured at our facilities in Thief River Falls, Minnesota. A Taiwanese company manufactures our 90cc to 450cc ATVs according to our specifications. We have strategically identified specific core manufacturing competencies for vertical integration and have chosen outside suppliers to provide other parts. We have developed relationships with selected high quality suppliers in order to obtain access to particular capabilities and technologies outside the scope of our expertise. We often design component parts in cooperation with our suppliers, contract with them for the development of tooling, and then enter into agreements with these suppliers to purchase component parts manufactured utilizing the tooling. In our vertically integrated operations, we manufacture foam seats, machine, weld, and paint other components, and complete the total assembly of most of our products at our facilities in Thief River Falls, Minnesota. Manufacturing operations include robotics as well as digital and computer automated equipment to speed production, reduce costs and improve the quality, fit and finish of every product.

During late fiscal 2005, we began manufacturing select Arctic Cat designed ATV engines as part of a strategic first step in a new engine program. We believe that having the capability to design and manufacture our own ATV engines enables us to offer customers more choices, provide excellent value, lower Japanese yen currency exposure and enhance our long-term competitive position. In 2007, we transitioned our engine manufacturing from the Thief River Falls facility to our facility in St. Cloud, Minnesota.

We have expanded our snowmobile engine design capabilities and work with a variety of suppliers for various engine component parts. In February 2013, we announced an engine supply agreement with Yamaha through which we purchase select Yamaha 4-stroke engines. The first engine we received was a 135 horse power 4-stroke engine and was used in our new model year 2014 snowmobiles. We also announced our first snowmobile engine that we manufactured in our St. Cloud, Minnesota facility, a 600cc 2-stroke engine that was produced for model year 2014. In addition to purchasing Yamaha engines, we also reached an agreement to build select 4-stroke Yamaha snowmobiles using Yamaha engines. These snowmobiles are built in our Thief River Falls, Minnesota facility and started production during fiscal year 2014.

Since we began snowmobile production, we have followed a build-to-order policy to control inventory levels. Under this policy, we only manufacture a number of snowmobiles equivalent to the orders received from our dealers and distributors, plus a number of uncommitted units used for dealer and market development, in-house testing and miscellaneous promotional purposes.

Most sales of snowmobiles to retail customers begin in the early fall and continue during the winter. Orders by dealers and distributors for each year’s production are placed in the spring following dealer and distributor meetings. Snowmobiles are built commencing in late spring and continuing through late autumn.

Retail sales of ATVs and ROVs occur throughout the year with seasonal highs occurring in the spring and fall. We build and purchase ATVs and build ROVs throughout the year to coincide with dealer and consumer demand.

In April 2015, we began a two-year investment program in Thief River Falls, Minnesota to enhance manufacturing capabilities. The first investment is a new approximately $12 million powder paint system, which we expect to be completed during the first quarter of fiscal 2017. The next phase will be implementing new assembly processes, which we anticipate will be started in the first quarter of fiscal 2017.

We are committed to an ongoing engineering and research and development program dedicated to innovation and to continued improvements in the quality and performance of our products as well as new product introduction. We currently employ 189 individuals in the design and development of new and existing products,

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with an additional 19 individuals directly involved in the testing of snowmobiles, ATVs and ROVs in normal and extraordinary conditions. In addition, these units are tested in conditions and locations similar to those in which they are used. We use computer aided design and manufacturing systems to shorten the time between initial concept and final production. For fiscal years ended March 31, 2016, 2015 and 2014, we spent approximately $27.2 million, $24.3 million and $24.0 million, respectively, on engineering, research and development. Furthermore, utilizing their particular expertise, our suppliers regularly test and apply new technologies to the design and production of component parts.

Sales and Marketing

Our products are currently sold through an extensive network of independent dealers located throughout the United States, Canada, and Europe and through distributors representing dealers in Europe, Russia, China, South America, the Middle East, Asia and other international markets. To promote new dealerships and to service our existing North American dealer network, we also employ district sales managers throughout the United States, Canada and parts of Western Europe.

Our dealers enter into yearly contracts and are required to maintain status as an authorized dealer in order to continue selling our products. To obtain and maintain such status, dealers are expected to order a sufficient number of snowmobiles, and/or ATVs and ROVs to adequately service their respective market areas. In addition, dealers must perform service on these units and maintain satisfactory service performance levels, and their mechanics are expected to complete special training provided by us. Dealers are also expected to carry adequate levels of inventory of genuine Arctic Cat parts, garments and accessories. As is typical in the industry, most of our dealers also sell some combination of motorcycles, marine products, lawn and garden products and other related products.

We utilize distributors in some countries outside the United States and Canada to take advantage of their knowledge and experience in their respective markets and to increase market penetration of our products. Canadian sales are made in Canadian dollars, nearly all of which are financed through a Canadian financial institution. Most sales to distributors outside North America are made in U.S. dollars and are supported to some extent by letters of credit or credit insurance. Our European subsidiary’s sales to its dealers and distributors are denominated in Euros and are supported by credit insurance.

Our sales and marketing efforts include dealer and consumer promotions, direct advertising and cooperative advertising programs with our dealers. We and many of our distributors conduct dealer shows or other sales events annually in order to introduce the upcoming year’s models and to promote dealer orders. Marketing activities are designed to promote directly to consumers. Products are advertised and promoted by us in consumer magazines, online and through other media. In addition, we engage in extensive dealer cooperative advertising on a local and national level, whereby we and our dealers share advertising costs. Each season we produce product brochures, point of purchase displays, leaflets, posters and banners, and other promotional items for use by our dealers. We also participate in key regional consumer shows and rallies with dealers and sponsor independent racers who participate in snowmobile races throughout the world. In order for our dealers and distributors to remain price competitive and to reduce retail inventories, we will from time to time make available to them rebate programs, discounts, or other incentives. In order to build brand loyalty we publish online magazines called Pride (snowmobile) and Ride (ATV and ROV).

We place strong emphasis on identifying and addressing the specific needs of our customers by periodically conducting dealer and consumer surveys and focus group meetings. Additionally, we hold many demo rides throughout the year which also allows for direct consumer feedback. We warrant our snowmobiles, ATVs and ROVs under a limited warranty against defects in materials and workmanship for a period generally ranging from six months to one year from the date of retail sale or for a period of 90 days from the date of commercial or rental use. Repairs or replacements under warranty are administered through our dealers and distributors.

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Competition

The snowmobile, ATV and ROV markets are highly competitive, based on a number of factors, including performance, ride, suspension, innovation, technology, styling, fit and finish, brand loyalty, reliability, durability, price and distribution. We believe Arctic Cat snowmobiles, ATVs and ROVs are highly regarded by consumers in all of these competitive categories. Certain of our competitors are more diversified and have financial and marketing resources which are substantially greater than ours. For a list of snowmobile, ATV and ROV competitors, please see “Industry Background” above.

Regulation

Both federal and state authorities have vigorous environmental control requirements relating to air, water and noise pollution that affect our manufacturing operations. We endeavor to ensure that our facilities comply with all applicable environmental regulations and standards.

Certain materials used in snowmobile, ATV and ROV manufacturing that are toxic, flammable, corrosive or reactive are classified by federal and state governments as “hazardous materials.” Control of these substances is regulated by the Environmental Protection Agency (“EPA”) and various state pollution control agencies, which require reports and inspection of facilities to monitor compliance. Our manufacturing facilities are subject to the regulations promulgated by, and may be inspected by, the Occupational Safety and Health Administration. In addition, our snowmobiles, ATVs and ROVs are subject to EPA emissions standards for model years 2006 and newer. We believe that we are and will continue to be in compliance with these regulations. We support balanced and appropriate programs that educate the customer on the safe use of our products and protect the environment.

The Consumer Product Safety Commission (“CPSC”) has federal oversight over product safety issues related to snowmobiles, ATVs and ROVs and from time to time is involved in rulemaking and standards setting related to safety. For example, in April 2016, the CPSC requested modifications to the ATV voluntary standard relating, in part, to lights and reflectors. Industry members are currently reviewing proposed modifications to the voluntary standard. In addition, under the Consumer Product Safety Improvement Act passed by Congress in August 2008, the prior ATV voluntary standard and certain other safety requirements became a mandatory CPSC standard. Arctic Cat has been and remains in compliance with existing standards. Various states have also promulgated safety regulations regarding snowmobiles, ATVs and ROVs, none of which have had a materially more burdensome impact on us than CPSC regulations.

When we sell our products outside the United States our products are also subject to international laws and regulations related to emissions and safety matters. Europe currently regulates ATV and ROV emissions and our products meet such requirements. In early 2016, the European Commission adopted substantial changes (Euro IV) to their regulations. We are aware of the new product standards and adaptations required to meet the new regulations and have established a product plan to achieve compliance.

We are a member of the International Snowmobile Manufacturers Association (“ISMA”), a trade association formed to promote safety in the manufacture and use of snowmobiles, among other things. The ISMA is currently made up of Arctic Cat, BRP, Yamaha, and Polaris. The ISMA members are also members of the Snowmobile Safety and Certification Committee (“SSCC”), which promulgates voluntary safety standards for snowmobiles. The SSCC standards, which require testing and evaluation by an independent testing laboratory of each model category produced by participating snowmobile manufacturers, have been adopted by the Canadian Ministry of Transport. Following the development of the SSCC standards, the CPSC denied a petition to develop a mandatory federal safety standard for snowmobiles in light of the high degree of adherence to the SSCC standards in the United States. Since our inception, all of our models have complied with the SSCC standards.

We are a member of the Specialty Vehicle Institute of America, a trade association organized to foster and promote the safe and responsible use of ATVs manufactured and/or distributed throughout the United States and which promulgates voluntary standards for ATVs. Additionally, we are a member of the Recreational

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Off-highway Vehicle Association, a trade association organized to foster and promote safe and responsible use of recreational off-highway vehicles and which promulgates voluntary standards for ROV’s. We are also a member of the Canadian Off-Highway Vehicle Distributors Council, as well as the All-Terrain Vehicle Industry European Association.

Effects of Weather

While lack of snowfall in a particular region may adversely affect snowmobile retail sales within that region from time to time, we work to mitigate this effect by taking snowmobile orders in the spring for the following winter season. In the past, weather conditions have materially affected snowmobile sales and weather conditions may materially affect our future sales of snowmobiles, ATVs, ROVs and parts, garments and accessories.

Employees

At March 31, 2016, we had 1,573 employees, including 370 salaried and 1,203 hourly and production personnel. Our employees are not represented by a union or subject to a collective bargaining agreement. We have never experienced a strike or work stoppage and consider our relations with our employees to be excellent.

Intellectual Property

We patent significant innovations that we consider patentable, and we own numerous patents for our snowmobiles, ATVs, ROVs and other products. Additionally, we vigorously defend against the infringement of our patents by third parties. Trademarks are also important to our snowmobile, ATV, ROV and related parts, garments and accessories business activities. We believe that our “Arctic Cat” registered trademark is our most significant trademark. We also have numerous registered trademarks, trade names and logos, both in the United States and internationally.

Financial Information about Geographic Areas

Financial information regarding domestic and geographic areas is included in Note 11, Segment Reporting, of the Notes to Consolidated Financial Statements, included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

Available Information

We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended and its rules and regulations (the “Exchange Act”). The Exchange Act requires us to file periodic reports, proxy statements and other information with the Securities and Exchange Commission (“SEC”). Copies of these reports, proxy statements and other information can be read and copied at the SEC Public Reference Room, 100 F Street, N.E., Washington D.C. 20549. Information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. The SEC maintains a website that contains reports, proxy statements, and other information regarding issuers that file electronically with the SEC. These materials may be obtained electronically by accessing the SEC’s website at http://www.sec.gov.

We maintain a website at www.arcticcat.com, the contents of which are not part of or incorporated by reference into this Annual Report on Form 10-K. We make our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K (and amendments to those reports) available on our website, free of charge, as soon as reasonably practicable after such reports have been filed with or furnished to the SEC. Our Code of Conduct, as well as any waivers from and amendments to the Code of Conduct that would otherwise be required to be reported on Form 8-K, are also posted on our website.

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Executive Officers of the Registrant

The following represents the executive officers of the registrant as of May 20, 2016.

Name	Age		Position
Christopher T. Metz		51	President and Chief Executive Officer
Christopher J. Eperjesy		48	Chief Financial Officer
Tracy J. Crocker		56	Vice President—General Manager, ATV/ROV
Paul A. Fisher		59	Vice President—Operations
Patricia L. Jones		53	Chief Human Resources Officer
Michael D. Okerlund		43	Vice President—Legal Affairs and Corporate Secretary
Briton Reich		52	Vice President—North American Sales
Greg Williamson		47	Chief Marketing Officer

Mr. Metz became our President and Chief Executive Officer effective December 3, 2014. He previously served as a managing director of Sun Capital Partners, Inc. from 2005 to 2014. Prior to joining Sun Capital, Mr. Metz was president at Black & Decker, leading its Hardware and Home Improvement Group from 1999 to 2005. During his 13 years at Black & Decker, Mr. Metz held various other senior leadership positions, including president of Kwikset Corporation, president of Price Pfister faucets, president of Baldwin Hardware, and general manager of European Professional Power Tools and Accessories, based in Frankfurt, Germany. Mr. Metz previously served on the board of directors of Vince Holding Corp. from 2008 to 2014.

Mr. Eperjesy has been our Chief Financial Officer since February 2015. He brings more than 25 years of financial experience, including a strong background in manufacturing and international business and proven experience with mergers and acquisitions. Mr. Eperjesy spent 12 years as chief financial officer at Twin Disc, Inc. (NASDAQ: TWIN) a publicly held manufacturer and world-wide distributor of heavy-duty, off-highway and marine power transmission equipment. There he was responsible for all public company reporting, finance and internal controls, treasury, IT and legal functions. From 2001 to 2002, Mr. Eperjesy worked at Kmart Corporation as divisional vice president of corporate finance, responsible for all corporate-level planning and forecasting activities. Prior to Kmart, Mr. Eperjesy worked for Chrysler Corporation/DaimlerChrysler AG from 1995 to 2001 in various leadership roles, including international positions in Brussels, Belgium, and Stuttgart, Germany. Mr. Eperjesy began his career as an accountant with Coopers & Lybrand (now PricewaterhouseCoopers) from 1990 to 1994.

Mr. Crocker has been our Vice President—General Manager, ATV/ROV since August 2015. Prior to that, he was our Vice President—General Manager, ATV and Parts, Garments and Accessories from November 2014 to August 2015, Vice President—General Manager, Parts, Garments and Accessories from June 2013 to October 2014, Vice President—Special Projects from April 2013 to May 2013 and Vice President—General Manager, All-Terrain Vehicles from March 2012 to March 2013. Prior to joining us, Mr. Crocker worked for Ecolab from 2002 to 2011, serving as senior vice president of Ecolab’s Hospitality, Healthcare and Commercial markets businesses. Prior to that he served as Ecolab’s senior vice president and general manager for Latin America and as a division vice president of marketing. Before joining Ecolab, he worked in sales and operating roles for Next Generation Network, Nabisco and Pepsi.

Mr. Fisher has been our Vice President—Operations since May 2010. Prior to joining us, Mr. Fisher worked for Ingersoll Rand from 2005 to 2010, where he served as business leader of the Trane Residential Division operations for five years. Before joining Ingersoll Rand, Mr. Fisher was employed by Maytag Corporation for approximately 21 years, most recently as vice president of Southwest Operations for Maytag’s Hoover Vacuum Division.

Ms. Jones has been our Chief Human Resources Officer since March 2016. Prior to that, Ms. Jones was senior vice president of administration for Lifetouch, Inc. from April 2009 to June 2015. Prior to that, Ms. Jones

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was executive vice president and chief administrative officer (CAO) for Allina Hospitals & Clinics from 2002 to 2005. Ms. Jones previous experience also includes serving as CAO and general counsel for H.B. Fuller Company and as senior vice president of administration and general counsel for the Star Tribune newspaper. Ms. Jones began her career with the former Northwest Airlines, now Delta Airlines, where she advanced through increasingly responsible labor relations and legal roles to become vice president of human resources.

Mr. Okerlund has been our Vice President—Legal Affairs since July 2014 and Corporate Secretary since January 2015. Prior to that, he served as our Director—Legal, having joined Arctic Cat in January 2012. Prior to joining us, Mr. Okerlund served from 2008 to 2012 as the general counsel of Hysitron, Inc., a nanotechnology company based in Eden Prairie, MN. Prior to that he served as a litigation attorney specializing in Intellectual Property at the law firm of Robins, Kaplan, Miller & Ciresi L.L.P. from 2003 to 2007.

Mr. Reich has been our Vice President—North American Sales since April 2015. Prior to joining us, he served as Executive Vice President of Sales at American Recreation Products from November 2009 to April 2015. Mr. Reich began his career at Black & Decker where he spent 19 years in various sales and marketing roles, including vice president of sales.

Mr. Williamson has been our Chief Marketing Officer since April 2015. Prior to that, Mr. Williamson served as chief marketing officer at Spectrum Brands Hardware and Home Improvement Division from July 2013 to April 2015 where he led the product, channel and brand strategies for several industry-leading hardware brands, including Kwikset, Baldwin, Weiser, and National Hardware. Prior to that, Mr. Williamson served as president at Spectrum Brands Pfister Faucet Company from June 2011 to June 2013 and before that vice president of sales and marketing at Spectrum Brands Pfister Faucet Company from December 2005 to May 2011.

ITEM 1A. RISK FACTORS

The following are significant factors known to us that could adversely affect our business, financial condition, results of operations or cash flows, as well as adversely affect the value of an investment in our common stock. These risks could cause our actual results to differ materially from our historical experience and from results predicted by forward-looking statements. All forward-looking statements made by us are qualified by the risks described below. There may be additional risks that are not presently material or known. You should carefully consider each of the following risks and all other information set forth in this Annual Report on Form 10-K.

Macroeconomic conditions and other external factors may adversely affect our results of operations.

Our results of operations are sensitive to changes in macroeconomic conditions that impact consumer spending. Consumer confidence, employment levels, interest rates, tax rates, housing market conditions, fuel and energy costs, and the availability of financing for our dealers and end consumers could reduce consumer spending, including discretionary spending on snowmobile and ATV/ROV industry products. Our future results could be significantly adversely impacted by these factors.

Our products are subject to extensive federal and state safety, environmental and other government regulations that may require us to incur expenses or modify product offerings in order to maintain compliance with regulations.

Our products are subject to extensive laws and regulations relating to safety, environmental and other regulations promulgated by the U.S. and Canadian federal governments and individual states and provinces, as well as international regulatory authorities. Although we believe that our snowmobiles, ATVs and ROVs have always complied with applicable vehicle safety and emissions standards and related regulations, future regulations may require additional safety standards or emission reductions that would require additional expenses

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and/or modification of product offerings in order to maintain such compliance. We are unable to predict the ultimate impact of adopted or proposed regulations on our business and operating results.

A significant adverse determination in any material product liability or intellectual property claim against us could adversely affect our operating results or financial condition.

We are subject to legal proceedings and claims which arise in the ordinary course of business. Accidents involving personal injury and property damage may occur in the use of snowmobiles, ATVs and ROVs and claims have been made against us from time to time relating to these accidents. In addition, our products, and the products of our competitors, incorporate significant amounts of intellectual property developed by us and others and, from time to time, parties assert claims against us relating to their intellectual property. It is our policy to vigorously defend against these product liability and intellectual property claims. We have recorded a reserve based on our estimated range of potential exposures to the legal proceedings and claims of which we are aware. Should any judgment or settlement occur that exceeds our estimate, or a new claim arise, we may need to adjust our overall reserve and, depending on the amount, such adjustment could have a material adverse effect on our operating results or financial condition.

Significant repair and/or replacement with respect to product warranty claims or product recalls could have a material adverse impact on our results of operations.

We provide a limited warranty on retail sales for a period of six months for our ATVs and ROVs and one year for our snowmobiles. We may provide longer warranties in certain geographical markets as determined by local regulations and market conditions, as well as related to certain promotional programs. Although we employ quality control procedures, sometimes a product is distributed that requires repair or replacement. Our standard warranties require us, through our dealers, to repair or replace defective products during such warranty periods at no cost to the consumer. Historically, product recalls have been administered through our dealers and distributors and have not had a material effect on our business. However, the repair and replacement costs and potential harm to our reputation we could incur in connection with a recall could have a material adverse impact on our business.

Our ability to remain competitive is contingent upon our capability, and ability, to develop and successfully introduce new, innovative and compliant products that respond to customer demands and preferences and achieve market acceptance.

Arctic Cat’s growth strategy is to deliver the ultimate off-road riding experience for riders, workers and outdoor enthusiasts through product development and innovation to generate future revenue growth. Product development and improvement and new product innovation require significant research, planning, design, development, engineering, and testing at the technological product and manufacturing process levels, as well as considerable financial, technological, and other resources. Due to these substantial requirements, we may not be able to timely develop and introduce product improvements or new products. Our competitors’ new products may beat our products to market, be higher quality or more reliable, be more effective with more features and/or less expensive than our products, obtain better market acceptance, or render our products obsolete. Further, any new products that we develop may not receive market acceptance or otherwise generate any meaningful net sales or profits for us relative to our expectations based on, among other things, existing and anticipated investments in manufacturing capacity and commitments to fund advertising, marketing, promotional programs, and research and development. If we are unable to continue to enhance existing products and develop new innovative products, we may not be able to adequately compete with our competitors and ultimately satisfy the needs, demands, and preferences of our end customers.

Changing weather conditions may reduce demand for certain of our products and negatively impact net sales.

Lack of snowfall in any year in particular regions of North America and Northern Europe may adversely impact snowmobile retail sales and related PG&A sales in that region. Lack of snowfall in a given year may also

10

reduce overall industry demand, which could lead to increased promotional activity and lower future net sales. Weather conditions may materially affect our future sales of snowmobiles, ATVs, ROVs and PG&A.

We face intense competition in all product lines from competitors that have greater financial and marketing resources. Failure to compete effectively against competitors could negatively impact our business and operating results.

The snowmobile and ATV/ROV markets worldwide are highly competitive. Competition is based upon a number of factors, including performance, ride, suspension, innovation, technology, styling, fit and finish, brand loyalty, reliability, durability, price and distribution. At the dealer level, competition is based on a number of factors including sales and marketing support programs (such as sales incentives and cooperative advertising). Many of our competitors are more diversified and have financial and marketing resources that are substantially greater than ours. In addition, our products compete with other recreational products for the discretionary spending of consumers. If we are not able to effectively compete in this environment, our business and operating results could be negatively impacted.

Termination or interruption of engine and other supply arrangements could have a material adverse effect on our business or results of operations.

In the event that we need to obtain substitute supply arrangements for engine or other raw materials or components for which we rely upon limited sources of supply, alternate supply arrangements may not be available with comparable terms.

Failure to establish and maintain the appropriate level of dealers and distributor relationships or weak economic conditions impacting those relationships may negatively impact our business and operating results.

We distribute our products through numerous dealers and distributors, and we rely on them to retail our products to the end customers. Our sales growth and profitability could be adversely affected if deterioration of economic or business conditions results in a weakening of the financial condition of a material number of our dealers and distributors. Additionally, weak demand for, or quality issues with, our products may cause dealers and distributors to voluntarily or involuntarily reduce or terminate their relationship with us. Further, if we fail to establish and maintain an appropriate level of dealers and distributors for each of our products, we may not obtain adequate market coverage for the desired level of retail sales of our products.

Fluctuations in foreign currency rates could result in declines in our reported net sales and net earnings

Our reported net sales and cost of goods sold are subject to fluctuations in foreign currency exchange rates. During fiscal 2016, sales to Canadian dealers that are denominated in Canadian dollars comprised 27.6% of total net sales. We utilized cash flow hedges to help mitigate the variability in Canadian exchange rate changes relating to Canadian dollar fund transfers to the United States. Sales to European on-road ATV dealers and distributors are made in Euros with the Euro serving as the functional currency. Sales to European on-road ATV dealers comprised 9.9% of total net sales in fiscal 2016. Approximately 8.7% of our total cost of goods sold was purchased from Japanese yen denominated suppliers during fiscal 2016. The majority of these purchases were made from Suzuki and Yamaha for engines for our snowmobiles. We have an agreement with Suzuki for snowmobile engine purchases to share the impact of fluctuations in the exchange rate between the U.S. dollar and the Japanese yen above and below a fixed range contained in the agreement. A change in foreign currency exchange rates could materially affect our business and operating results.

Security breaches, interruptions in their operation or other disruptions to our management information systems and data security could compromise sensitive information and expose us to a liability, which could adversely impact our operations, business, reputation, financial condition and operating results.

In the ordinary course of our business, we collect and store sensitive data within our internal data centers, cloud services and on our networks, including our proprietary business information and that of our customers,

11

suppliers and business partners, as well as personally identifiable information of our customers and employees. The secure processing, maintenance and transmission of proprietary business information and personally identifiable information is critical to our operations and business strategy. Despite our security measures, our information technology and infrastructure may be vulnerable to malicious attacks or breached due to employee error, malfeasance or other disruptions, including as a result of new systems rollouts or upgrades of existing systems. Any such breach, operational failure or difficulties encountered in the development of new systems or the upgrades of existing systems could compromise our networks and/or that of our partners and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such access, disclosure or other loss of information could create financial liability, subject us to legal or regulatory sanctions, disrupt our operations, damage our reputation, and/or cause a loss of confidence in our products and services, which could adversely affect our business.

Interruption of dealer floorplan financing could have a material impact on our business operations.

We have agreements with Wells Fargo Commercial Distribution Finance in the United States and Canada and, through June 2016, TCF Commercial Finance Canada in Canada to provide snowmobile, ATV and ROV floorplan financing for our North American dealers. These agreements improve our liquidity by financing dealer purchases of our products without requiring substantial use of our working capital. We are paid by the floorplan companies shortly after shipment and as part of our marketing programs, we pay the floorplan financing of our dealers for certain set time periods depending on the size of a dealer’s order. While we expect to continue with our current dealer floorplan arrangements, these arrangements may not remain available or the costs and other terms of new financing arrangements may be significantly less favorable to us than have historically been available.

Termination, interruption or nonrenewal of bank credit agreements could have a material adverse effect on our business or results of operations.

The seasonality of our snowmobile, ATV and ROV production cycles generates significant fluctuations in our working capital requirements during each year. Historically, we have financed our working capital requirements out of available cash balances at the beginning and end of the production cycle and with short-term bank borrowings during the middle of this cycle. While we expect to continue with our current multi-year working capital financing agreement from our lender, working capital financing arrangements may not remain available or the costs and other terms of new financing arrangements may be significantly less favorable to us than have historically been available. In addition, our current bank credit agreement contains covenants which we might be unable to meet in some future period requiring the need for waivers or alternate financing.

If we fail to attract, develop and retain qualified employees, including employees in key positions, our business and operating results may be harmed.

Our performance is highly dependent on attracting and retaining qualified employees, including our senior management team and other key employees. Factors that affect our ability to maintain qualified employees include employee morale, our reputation, unemployment rates, competition from other employers and our ability to offer appropriate compensation and benefit packages. Our inability to recruit a sufficient number of qualified individuals or failure to retain key employees in the future may impair our efficiency and effectiveness and our ability to pursue growth opportunities. In addition, a significant amount of turnover of employees with specific knowledge relating to us, our operations and our industry may negatively impact our operations.

Failure to effectively manage new business ventures, strategic alliances or acquisitions could have a negative impact on our business.

From time to time, our strategy has involved, and may in the future involve, entering into new business ventures and strategic alliances, as well as making acquisitions. Assessing a potential opportunity can be based on assumptions that might not ultimately prove to be correct. In addition, the amount of information we can obtain about a potential opportunity may be limited, and we can give no assurance that new business ventures, strategic alliances and acquisitions will positively affect our financial performance or will perform as planned.

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The success of these opportunities is also largely dependent on the current and future participation, working relationship and strategic vision of the business venture or strategic alliance partners, which can change following a transaction. Integrating new businesses can be a difficult task, and these types of transactions may divert our capital and our management’s attention from other business issues and opportunities. We may also encounter challenges in achieving appropriate internal control over financial reporting and deficiencies in information technology systems in connection with the integration of an acquired company. If we fail to assimilate or integrate acquired companies successfully, our business, reputation and operating results could suffer materially. Likewise, our failure to integrate and manage acquired companies successfully may lead to impairment of the associated goodwill and intangible asset balances.

If we fail to maintain an effective system of internal controls, we may not be able to accurately report our financial results and prevent fraud.

Our efforts to maintain our internal controls may not be successful, and we may be unable to maintain effective controls over our financial processes and reporting in the future and comply with the certification and reporting obligations under Sections 302 and 404 of the Sarbanes-Oxley Act. Any failure to maintain effective controls could result in material misstatements that are not prevented or detected and corrected on a timely basis, which could potentially subject us to sanction or investigation by the SEC or other regulatory authorities. Ineffective internal controls could also cause investors to lose confidence in our reported financial information and adversely affect our business and our stock price.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

The following sets forth our material property holdings as of March 31, 2016.

Location	Facility Type / Use	Owned or Leased		Sq. Ft.
Plymouth, Minnesota	Corporate Office		Leased		11,420
Thief River Falls, Minnesota	Manufacturing		Owned		585,000
Thief River Falls, Minnesota	Warehouse		Owned		25,000
Thief River Falls, Minnesota	Warehouse		Leased		38,000
St. Cloud, Minnesota	Manufacturing		Owned		60,800
Bucyrus, Ohio	Distribution Center		Owned		202,000
Island Park, Idaho	Test and Development Facility		Owned		3,000
Idaho Falls, Idaho	MotorFist Office		Leased		5,800
Rigby, Idaho	MotorFist Warehouse		Leased		6,000
Winnipeg, Manitoba	Service Center		Leased		9,929
St. Johann, Austria	Administrative/Distribution		Leased		44,409

We have entered into an agreement to lease approximately 56,000 square feet of office space for our corporate headquarters in Minneapolis, Minnesota beginning in the summer of 2016. We believe that our material property holdings are suitable for our current operations and purposes.

ITEM 3. LEGAL PROCEEDINGS

For a description of our legal proceedings, see Note 10, Commitments and Contingencies, of the Notes to Consolidated Financial Statements, included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

ITEM 4. MINE SAFETY DISCLOSURES

None.

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PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our common stock is traded on The NASDAQ Global Select Market under the NASDAQ symbol “ACAT.” Quotations below represent the high and low quarterly sale prices as reported by NASDAQ during fiscal 2016 and 2015.

	2016				2015
	High		Low		High		Low
First quarter	$	39.00	$	30.75	$	48.41	$	31.95
Second quarter		34.44		22.15		40.59		34.51
Third quarter		25.60		15.44		35.75		30.11
Fourth quarter	$	19.82	$	8.90	$	39.72	$	26.00

As of May 20, 2016, we had approximately 273 stockholders of record, including the nominee of Depository Trust Company which held 12,761,456 shares of common stock.

Cash Dividends Paid

Our Board of Directors considers our cash position and projected cash needs in regards to our dividend policy. In January 2016, the Board of Directors voted to suspend our quarterly cash dividend in order to preserve cash for continued investment in our growth initiatives. The table below represents the dividends paid by quarter during fiscal 2016 and 2015 ($ in thousands):

	2016		2015
First quarter	$	1,635	$	1,617
Second quarter		1,640		1,624
Third quarter		1,642		1,624
Fourth quarter		—		1,635
Total cash dividends paid	$	4,917	$	6,500

For information about our dividend policy and restrictions imposed by our credit facility on our ability to declare and pay dividends, refer to the discussion under the heading “Dividends” in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, of this Annual Report on Form 10-K.

Company Purchases of Company Equity Securities

On August 7, 2014, the Board authorized the repurchase of an additional $25.0 million in shares of common stock, which supplemented the $1.1 million remaining under the program previously approved in May 2013. The share repurchase program does not have an expiration date. The following table presents the total number of shares repurchased during the second quarter of fiscal 2016 by fiscal month, the average price paid per share, the number of shares that were purchased as part of a publicly announced repurchase plan, and the approximate dollar value of shares that may yet be purchased pursuant to our stock repurchase program as of the end of the second quarter of fiscal 2016:

Period	Total Number of Shares Purchased (1)		Average Price Paid per Share		Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
January 1, 2016 - January 31, 2016		—	$	—	$	25,921,057
February 1, 2016 - February 29, 2016		—		—		25,921,057
March 1, 2016 - March 31, 2016		972		16.80		25,904,727
Total		972	$	16.80	$	25,904,727

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(1) All shares purchased were under the share repurchase program.

Performance Graph

The graph below compares the cumulative total shareholder return on our common stock for the last five fiscal years to the Standard & Poor’s 500 Index, and to the Recreational Vehicles Index prepared by Hemscott, Inc., of which we are a component. The graph assumes an investment of $100 at the close of business on March 31, 2011, and the reinvestment of all dividends and has been adjusted to reflect stock splits. The performance graph is not necessarily indicative of future investment performance.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN

Among Arctic Cat Inc., the S&P 500 Index

and Hemscott—Recreational Vehicles Index

Assumes $100 invested on March 31, 2011

Fiscal year ended March 31,

	2011		2012		2013		2014		2015		2016
Arctic Cat Inc.	$	100.00	$	275.50	$	281.03	$	309.77	$	238.71	$	112.02
S&P 500 Index		100.00		108.54		123.69		150.73		169.92		172.95
Hemscott—Recreational Vehicles Index	$	100.00	$	125.33	$	148.83	$	207.03	$	201.70	$	170.02

*$100 invested on 3/31/11 in stock or index, including reinvestment of dividends.

Fiscal year ending March 31.

Copyright© 2016 S&P, a division of McGraw Hill Financial. All rights reserved.

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ITEM 6. SELECTED FINANCIAL DATA

OPERATING STATEMENT DATA:
Years ended March 31,	2016			2015			2014			2013			2012
($ in thousands, except per share amounts)
Net sales
Snowmobile and ATV/ROV units	$	534,600		$	584,873		$	615,608		$	563,464		$	477,329
Parts, garments and accessories		98,295			113,883			114,883			108,124			107,939
Total net sales		632,895			698,756			730,491			671,588			585,268
Cost of goods sold
Snowmobile and ATV/ROV units		476,194			505,383			506,707			450,291			388,523
Parts, garments and accessories		66,034			73,924			72,705			70,401			66,126
Total cost of goods sold		542,228			579,307			579,412			520,692			454,649
Gross profit		90,667			119,449			151,079			150,896			130,619
Operating expenses
Selling and marketing		43,714			39,656			38,028			37,402			36,549
Research and development		27,162			24,341			23,998			20,693			17,862
General and administrative		36,005			48,914			28,557			32,087			30,318
Total operating expenses		106,881			112,911			90,583			90,182			84,729
Operating profit (loss)		(16,214	)		6,538			60,496			60,714			45,890
Interest income		15			25			30			49			86
Interest expense		(848	)		(353	)		(122	)		(84	)		(8	)
Earnings (loss) before income taxes		(17,047	)		6,210			60,404			60,679			45,968
Income tax expense (benefit)		(7,860	)		1,290			21,000			20,934			16,027
Net earnings (loss)	$	(9,187	)	$	4,920		$	39,404		$	39,745		$	29,941
Net earnings (loss) per share
Basic	$	(0.71	)	$	0.38		$	2.97		$	3.02		$	1.79
Diluted	$	(0.71	)	$	0.38		$	2.90		$	2.89		$	1.72
Cash dividends per share	$	0.38		$	0.50		$	0.40		$	—		$	—
Weighted average shares outstanding
Basic		12,995			12,926			13,275			13,155			16,721
Diluted		12,995			13,089			13,598			13,761			17,458

BALANCE SHEET DATA:
As of March 31,	2016		2015		2014		2013		2012
($ in thousands)
Cash and short-term investments	$	17,730	$	41,262	$	82,532	$	112,807	$	62,597
Working capital		105,017		123,875		136,755		132,052		98,825
Total assets		317,894		315,411		342,294		306,145		255,416
Debt, including current portion		—		—		—		—		—
Shareholders’ equity		167,391		180,371		185,043		174,472		138,472

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following management’s discussion and analysis of financial condition and results of operations should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

Results of Operations

Executive Overview

Fiscal 2016 net sales decreased 9.4% to $632.9 million from $698.8 million in fiscal 2015. Fiscal 2016 net loss was $9.2 million, or $0.71 per share, compared to net earnings of $4.9 million or $0.38 per diluted share in fiscal 2015.

We faced a difficult environment in fiscal 2016, which included foreign currency headwinds, a lack of snowfall in key regions that constrained snow-related sales, and a softening powersports market. A competitive retail environment also led to higher spending than planned on promotional programs, particularly in ATVs and ROVs.

Despite these challenges, we continued to execute well on our strategies. We further strengthened and expanded our dealer base. We activated sales through important marketing sponsorships with Robby Gordon and our new event marketing team. We also continued to maintain tight inventory control to allow a return to greater wholesale and retail growth of new products in fiscal 2017.

Our key strategies to reinvigorate growth include: dramatically improving Arctic Cat’s dealer network; ramping up end-user focused new products; pursuing strategic partnerships; and creating a brand marketing powerhouse.

We face continued challenges in fiscal 2017, with a soft powersports marketplace and foreign currency headwinds. We will continue to pursue our long-term strategies to: improve and expand our dealer network; develop revenue and margin expansion from new products; secure partnerships that extend our distribution channels and product mix; and create a brand marketing powerhouse. We have made progress in each of these areas and expect to build further momentum going forward. We will continue to balance the investments needed for revenue and margin growth with a keen focus on continuously improving our efficiency in a difficult macroeconomic environment.

For the fiscal year ending March 31, 2017, we estimate full-year net sales in the range of $635 million to $655 million, assuming a favorable foreign currency exchange impact on sales and gross profit in the range of $2 million to $5 million. We expect fiscal 2017 full-year net earnings to range from a loss of $0.39 per share to earnings of $0.08 per diluted share. Foreign currency exchange headwinds in fiscal 2017, primarily driven by the year-over-year impact of foreign currency exchange hedge losses, are estimated to reduce net earnings in the range of $0.42 to $0.53 per diluted share compared to fiscal 2016. We expect fiscal 2017 net sales to be down 8% to 12% in the first and second quarters, as we continue efforts to improve dealer inventory and prepare to launch new products. We anticipate our fiscal 2017 sales and earnings performance will be lowest in the first quarter. We expect stronger financial results in the second half of the fiscal year to be driven by new product launches that will begin in the fiscal 2017 third quarter, with the majority of new products to be launched in the fiscal 2017 fourth quarter.

Our focus over the next year is to rebuild and reposition Arctic Cat for a return to long-term growth. We are confident in our strategic plans to turn the business around. Despite the challenges, we see tremendous opportunities to improve our operations, expand gross margins and enhance financial performance over time.

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Product Line Sales

	Year Ended March 31,
($ in thousands)	2016		Percent of Net Sales			2015		Percent of Net Sales			Change 2016 vs.  2015			2014		Percent of Net Sales			Change 2015 vs.  2014
Snowmobile	$	258,788		40.9	%	$	300,731		43.0	%		(13.9	)%	$	282,442		38.7	%		6.5	%
ATV/ROV		275,812		43.6	%		284,142		40.7	%		(2.9	)%		333,166		45.6	%		(14.7	)%
PG&A		98,295		15.5	%		113,883		16.3	%		(13.7	)%		114,883		15.7	%		(0.9	)%
Total net sales	$	632,895		100.0	%	$	698,756		100.0	%		(9.4	)%	$	730,491		100.0	%		(4.3	)%

During fiscal 2016, net sales decreased 9.4% to $632.9 million from $698.8 million in fiscal 2015, primarily driven by lower sales volume and an unfavorable foreign currency exchange rate impact of $31.5 million. Snowmobile sales decreased by 13.9% primarily due to a decrease in international sales to Russia and unfavorable foreign currency exchange rates. ATV/ROV sales decreased 2.9% due to unfavorable foreign currency exchange rates. PG&A sales decreased 13.7% primarily due to a decline in volume driven by low snowfall in key regions and unfavorable foreign currency exchange rates, partially offset by sales from Motorfist.

During fiscal 2015, net sales decreased 4.3% to $698.7 million from $730.5 million in fiscal 2014. Snowmobile unit volume increased 8.6%, ATV unit volume decreased 8.2%, and PG&A sales decreased $1.0 million or 0.9%. The decrease in net sales was driven by decreased net sales in core ATVs. Although snowmobile unit volume increased 8.6%, snowmobile net sales increased only 6.5% due to increased sales of lower priced snowmobile models built for Yamaha and a weaker Canadian dollar.

Cost of Goods Sold

	Year Ended March 31,
($ in thousands)	2016		Percent of Total Cost of Goods Sold			2015		Percent of Total Cost of Goods Sold			Change 2016 vs. 2015			2014		Percent of Total Cost of Goods Sold			Change 2015 vs. 2014
Snowmobiles and ATV/ROV units	$	476,194		87.8	%	$	505,383		87.2	%		(5.8	)%	$	506,707		87.5	%		(0.3	)%
PG&A		66,034		12.2	%		73,924		12.8	%		(10.7	)%		72,705		12.5	%		1.7	%
Total cost of goods sold	$	542,228		100.0	%	$	579,307		100.0	%		(6.4	)%	$	579,412		100.0	%		0.0	%

During fiscal 2016, cost of goods sold decreased 6.4% to $542.2 million from $579.3 million for fiscal 2015. Fiscal 2016 snowmobile and ATV unit cost of goods sold decreased 5.8% to $476.2 million from $505.4 million. The decrease in cost of goods sold for units was driven by lower sales volume and the unfavorable foreign currency exchange impact contributed to the increase in unit cost of goods sold as a percentage of net sales. The fiscal 2016 cost of goods sold for parts, garments and accessories decreased to $66.0 million from $73.9 million for fiscal 2015 due primarily to lower sales volume.

Fiscal 2015 cost of goods sold was essentially flat at $579.3 million compared with $579.4 million for fiscal 2014. Fiscal 2015 snowmobile and ATV unit cost of goods sold decreased 0.3% to $505.4 million from $506.7 million. The unit cost of goods sold as a percentage of sales increased to 86.4% from 82.3% primarily due to anticipated lower selling prices on snowmobile models built for Yamaha, product mix, the ATV warranty recall, the core ATV inventory reduction program, and a weaker Canadian dollar. The fiscal 2015 cost of goods sold for PG&A increased to $73.9 million from $72.7 million for fiscal 2014 due primarily to product mix and a higher volume of products at reduced selling prices.

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Gross Profit

	Year Ended March 31,
($ in thousands)	2016			2015			Change 2016 vs. 2015			2014			Change 2015 vs. 2014
Gross profit	$	90,667		$	119,449			(24.1	)%	$	151,079			(20.9	)%
Percentage of net sales		14.3	%		17.1	%		(2.8	)%		20.7	%		(3.6	)%

Gross profit decreased 24.1% to $90.7 million in fiscal 2016 from $119.4 million in fiscal 2015. The gross profit percentage for fiscal 2016 decreased to 14.3% compared with 17.1% in fiscal 2015. The decrease in the fiscal 2016 gross profit was primarily due to the $31.5 million unfavorable impact of foreign currency exchange rates and lower sales volume. These decreases were partially offset by the absence of the $5.3 million product warranty recall in fiscal 2015, which did not recur in fiscal 2016.

Gross profit decreased 20.9% to $119.4 million in fiscal 2015 from $151.1 million in fiscal 2014. The gross profit percentage for fiscal 2015 decreased to 17.1% versus 20.7% in fiscal 2014. The decrease in the fiscal 2015 gross profit percentage was primarily due to lower gross margins on snowmobile models built for Yamaha, product mix, the ATV warranty recall, the core ATV inventory reduction program, and a weaker Canadian dollar.

Operating Expenses

	Year Ended March 31,
($ in thousands)	2016			2015			Change 2016 vs.  2015			2014			Change 2015 vs.  2014
Selling and marketing	$	43,714		$	39,656			10.2	%	$	38,028			4.3	%
Research and development		27,162			24,341			11.6	%		23,998			1.4	%
General and administrative		36,005			48,914			(26.4	)%		28,557			71.3	%
Total operating expenses	$	106,881		$	112,911			(5.3	)%	$	90,583			24.6	%
Percentage of net sales		16.9	%		16.2	%					12.4	%

Selling and marketing expenses increased 10.2% to $43.7 million in fiscal 2016 from $39.7 million in fiscal 2015, primarily due to increased ATV dealer show expenses, brand marketing initiatives and increased compensation costs. Research and development expenses increased 11.6% to $27.2 million in fiscal 2016 compared to $24.3 million in fiscal 2015, due primarily to increased ATV/ROV research and development activities. General and Administrative expenses decreased 26.4% to $36.0 million in fiscal 2016 from $48.9 million in fiscal 2015, due primarily to a decrease in legal costs, gains from foreign currency hedging and the absence of executive transition costs incurred in fiscal 2015.

Selling and marketing expenses increased 4.3% to $39.7 million in fiscal 2015 from $38.0 million in fiscal 2014, primarily due to increased ATV dealer show expenses and other selling and marketing expenses related to all product lines. Research and development expenses increased 1.4% to $24.3 million in fiscal 2015 compared to $24.0 million in fiscal 2014, due primarily to higher compensation and development expenses. General and administrative expenses increased 71.3% to $48.9 million in fiscal 2015 from $28.6 million in fiscal 2014, due primarily to increased legal costs, executive transition costs and increased Canadian hedge costs.

Other Income (Expense)

We recognized an immaterial amount of interest income in fiscal 2016, 2015 and 2014. Interest expense increased to $0.8 million during fiscal 2016 from $0.3 million in fiscal 2015. The increase in interest expense during fiscal 2016 was primarily due to an increase in borrowings under our line of credit and the borrowings

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being outstanding for a longer period of time than in the prior year. Interest expense increased to $0.3 million in fiscal 2015 from $0.1 million in fiscal 2014. The increase in interest expense during fiscal 2015 was primarily due an increase in borrowings under our line of credit compared to fiscal 2014.

Income Tax Expense (Benefit)

In fiscal 2016, we recognized an income tax benefit of $7.9 million compared to the income tax expense of $1.3 million in fiscal 2015, primarily due to the $17.0 million pre-tax loss incurred in fiscal 2016 compared to $6.2 million of pre-tax earnings in fiscal 2015. The effective tax rate (ETR) was 46.0% and 20.8% in fiscal 2016 and 2015, respectively. The increase in the ETR was due to having a pre-tax loss in fiscal 2016 compared to pre-tax earnings in fiscal 2015, as the beneficial impact of discrete items increases when a pre-tax loss exists. We recognized income tax expense of $21.0 million in fiscal 2014. The decrease in fiscal 2015 compared to fiscal 2014 was due to a decrease in pre-tax earnings and a lower ETR in fiscal 2015. The ETR was 20.8% in fiscal 2015 compared to 34.8% in fiscal 2014. The decrease in the ETR in fiscal 2015 was due to the lower pre-tax earnings, as discrete items have a greater impact on the ETR when pre-tax earnings are lower.

Net Earnings (Loss)

Fiscal 2016 net loss was $9.2 million compared with net earnings of $4.9 million in fiscal 2015. The decrease from fiscal 2015 is due to lower sales and gross profit, which was only partially offset by a decrease in operating expenses. Fiscal 2015 net earnings were $4.9 million compared with net earnings of $39.4 million in fiscal 2014. The decrease in net earnings in fiscal 2015 is attributable to lower gross profit and an increase in operating expenses.

Liquidity and Capital Resources

We closely manage our liquidity and capital resources. Our liquidity requirements depend on a number of variables, including the level of investment to support our business strategies, the performance of our business, capital expenditures and working capital requirements. Capital expenditures are a significant use of our capital resources. These investments are intended to enable sales growth in new and expanding markets, help us to meet product demand and increase our manufacturing efficiencies and capacity.

The seasonality of our production cycles generates significant fluctuations in our working capital requirements during the year. Historically, we have financed our working capital requirements out of available cash balances at the beginning and end of the production cycle and with borrowings under our line of credit during the middle of the cycle. We believe current available cash and cash generated from operations, together with working capital financing through our available line of credit, will provide sufficient funds to finance operations on a short and long-term basis and for at least the next 12 months. However, there can be no assurance that adequate working capital financing arrangements will remain available or that the costs and other terms of such new financing arrangements will not be significantly less favorable to us than has historically been available.

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Working Capital

The following table represents net sales and ending inventories by each quarter in the fiscal years ended March 31, 2016 and 2015.

($ in thousands)	First		Second		Third		Fourth		Total
2016 Net sales:
Snowmobile	$	58,231	$	109,918	$	83,113	$	7,526	$	258,788
ATV/ROV		52,874		70,758		60,022		92,158		275,812
PG&A		23,276		30,481		22,865		21,673		98,295
Total net sales	$	134,381	$	211,157	$	166,000	$	121,357	$	632,895
Inventories	$	169,543	$	171,267	$	146,538	$	140,007
2015 Net sales:
Snowmobile	$	56,152	$	157,791	$	81,523	$	5,265	$	300,731
ATV/ROV		63,826		69,591		83,930		66,795		284,142
PG&A		23,661		35,097		28,282		26,843		113,883
Total net sales	$	143,639	$	262,479	$	193,735	$	98,903	$	698,756
Inventories	$	185,264	$	170,084	$	144,577	$	152,443

Cash Flow

The following table summarizes the cash flows from operating, investing and financing activities for the years ended March 31, 2016, 2015 and 2014 ($ in thousands):

	2016			2015			2014
Total cash provided by (used for):
Operating activities	$	19,123		$	59,701		$	44,179
Investing activities		(37,966	)		(30,624	)		(24,341	)
Financing activities		(4,698	)		(8,647	)		(33,475	)
Effects of exchange rate changes on cash and cash equivalents		1,018			(2,701	)		595
Increase (decrease) in cash and cash equivalents	$	(22,523	)	$	17,729		$	(13,042	)

Operating Activities

In fiscal 2016, cash provided by operating activities decreased $40.6 million, or 68.0%, from fiscal 2015 primarily due to a decrease in cash proceeds from trading securities, as we sold the majority of our short-term investments in fiscal 2015. In addition, cash provided by operating activities decreased in fiscal 2016 due to increased accounts receivable as a result of the timing of sales at the end of fiscal 2016 and a net loss compared to net earnings in fiscal 2015. These decreases were partially offset by cash provided by inventory due to our focus on reducing inventory in fiscal 2016, a decrease in cash used for accounts payable, cash consideration from our dealer floorplan financing agreements and $4.4 million of net cash received from the New Market Tax Credit transaction.

In fiscal 2015, cash provided by operating activities increased $15.5 million, or 35.1%, from fiscal 2014 primarily due to cash proceeds from trading securities, less cash used for inventories and lower accounts receivables in fiscal 2015. These increases were partially offset by a decrease in net earnings and cash used for accounts payable as a result of ending fiscal 2014 with higher-than-normal accounts payable due to timing of payments.

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Investing Activities

Cash used in investing activities in fiscal 2016 increased $7.3 million, or 24.0%, from fiscal 2015 due to cash used for purchases of property and equipment primarily resulting from investment in a new paint line in fiscal 2016.

Cash used in investing activities in fiscal 2015 increased $6.3 million, or 25.8%, from fiscal 2014 primarily due to cash used for the acquisition of MotorFist.

Financing Activities

In fiscal 2016, cash used in financing activities decreased $3.9 million, or 45.7%, from fiscal 2015 due to the suspension of our quarterly dividend payment in the fourth quarter of fiscal 2016 and a lower amount of cash utilized for income taxes on net settled option exercises and stock repurchases fiscal 2016 as compared to fiscal 2015.

In fiscal 2015, cash used in financing activities decreased $24.8 million, or 74.2%, from fiscal 2014 due to a reduction in cash used for stock repurchases and income taxes on net settled option exercises during fiscal 2015 as compared to fiscal 2014.

Financing Arrangements

We entered into a $100.0 million senior secured revolving credit agreement in November 2013 for documentary and stand-by letters of credit, working capital needs and general corporate purposes, which amended and restated our prior $60.0 million senior secured revolving credit agreement. The agreement was amended in May 2015 to consent to the formation of MotorFist LLC, a Minnesota limited liability company, and the purchase of certain assets of MotorFist LLC, an Idaho limited liability company, as well as to waive an existing default related to the acquisition and abandonment of intellectual property resulting from the MotorFist acquisition. In March 2016, we further amended the agreement to extend the maturity date of the credit facility from November 2017 to March 2021 and increase our maximum permissible borrowings from $100.0 million to $130.0 million during May through November and from $50.0 million to $75.0 million during all other months of the fiscal year. The amount of permissible borrowings under the credit facility are dependent upon adequate levels of underlying collateral. No borrowings were outstanding under the credit facility as of March 31, 2016. The total letters of credit issued at March 31, 2016 were $3.5 million.

We have agreements with Wells Fargo Commercial Distribution Finance in the United States and TCF Commercial Finance Canada in Canada to provide snowmobile, ATV and ROV floorplan financing for our North American dealers. In addition, we have entered into an agreement with Wells Fargo Commercial Distribution Finance to provide floorplan financing for our dealers in Canada effective June 2016, when our agreement with TCF Commercial Finance Canada expires. These agreements improve our liquidity by financing dealer purchases of products without requiring substantial use of our working capital. We are paid by the floorplan companies shortly after shipment and as part of our marketing programs, we subsidize the floorplan financing of our dealers for certain set time periods depending on the magnitude of qualifying purchases.

The financing agreements require repurchase of repossessed new and unused units and set limits upon our potential liability for annual repurchases. The aggregate potential liability was approximately $68.5 million at March 31, 2016. We have incurred no material losses under these agreements. We believe current available cash and cash generated from operations provide sufficient funding in the event there is a requirement to perform under these guarantee and repurchase agreements. The financing agreements also have loss sharing provisions should any dealer default whereby we share certain losses with the floorplan finance companies. The maximum potential liability to Arctic Cat under these provisions was approximately $2.2 million at March 31, 2016.

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Dividends

Our Board of Directors considers our cash position and projected cash needs in regards to our dividend policy. Cash dividends were paid and declared quarterly from 1995 through the third quarter of fiscal 2009, at which point we suspended the quarterly cash dividend. In May 2013, we reinstated the quarterly cash dividend at $0.10 per share, and we increased the quarterly cash dividend to $0.125 per share in May 2014. In January 2016, the Board of Directors voted to suspend our quarterly cash dividend in order to preserve cash for continued investment in our growth initiatives. While our Board of Directors has discretion to resume payment of cash dividends at any time, we do not anticipate declaring or paying cash dividends on our common stock in the foreseeable future. We declared and paid cash dividends of $4.9 million, $6.5 million and $5.3 million in fiscal 2016, 2015 and 2014, respectively.

Our credit facility restricts our ability to declare and pay cash dividends if our borrowings exceed certain thresholds. For information regarding the restrictions imposed by our credit facility, see Item 9B, Other Information, of this Annual Report on Form 10-K.

Contractual Obligations

Arctic Cat has obligations under non-cancelable operating lease contracts and purchase obligations. The following table summarizes our significant future contractual obligations at March 31, 2016 ($ in millions):

	Payment Due by Period
Contractual obligations	Total		Less than 1 year		1-3 years		3-5 Years		More than 5 years
Operating lease obligations (1)	$	15.6	$	1.5	$	2.6	$	2.4	$	9.1
Purchase obligations (2)		45.1		45.1		—		—		—
Total contractual obligations	$	60.7	$	46.6	$	2.6	$	2.4	$	9.1

(1) See Note 6, Leases, of the Notes to Consolidated Financial Statements, included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K for additional information.

(2) We have outstanding purchase obligations with suppliers and vendors at March 31, 2016 for raw materials and other supplies and services as part of the normal course of business

Critical Accounting Policies

The preparation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States requires management to make certain estimates and assumptions that affect the amount of reported assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and revenues and expenses during the periods reported. Actual results may differ from those estimates and such differences could be material. Arctic Cat’s significant accounting policies are described in Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K. We believe the following are the most critical accounting policies that could have an effect on our reported results. These critical accounting policies and estimates have been reviewed with the Audit Committee of the Board of Directors.

Revenue Recognition

We recognize revenue and provide for estimated marketing and sales incentive costs when products are shipped to dealers and distributors pursuant to their order, the price is fixed and collection is reasonably assured. Historically, product returns, whether in the normal course of business or resulting from repurchases made under the floorplan financing program, have not been material. However, we have agreements with dealer floorplan

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finance companies to repurchase products repossessed up to certain limits. Our financial exposure to repurchase products is limited to the difference between the amount paid to the finance company and the resale value of the repossessed products. No material losses have been incurred under these agreements; however, adverse changes in retail sales could cause this situation to change.

Marketing and Sales Incentive Costs

We provide for various marketing and sales incentive costs that are offered to our dealers and consumers at the later of when the revenue is recognized or when the marketing and sales incentive program is approved and communicated. Examples of these costs, which are recognized as a reduction of revenue when the products are sold, include dealer and consumer rebates, dealer floorplan financing assistance and other incentive and promotion programs. Sales incentives that involve a free product or service delivered to the consumer, such as extended warranties, are recorded as a component of cost of goods sold.

We estimate the costs of these various marketing and sales incentive programs based on expected usage considering current program parameters, historical experience, dealer inventory levels, the terms of arrangements with dealers and expectations for changes in relevant trends in the future. Adverse market conditions resulting in lower than expected retail sales or the matching of competitor programs could cause accrued marketing and sales incentive costs to materially increase if we authorize and communicate new programs to our dealers. The accrual for marketing and sales incentive costs at March 31, 2016 and 2015 was $9.1 million and $14.5 million, respectively, and is included in accrued expenses in our Consolidated Balance Sheet. To the extent current experience differs from previous estimates the accrued liability for marketing and sales incentives is adjusted accordingly.

Goodwill

Goodwill is not amortized but is tested for impairment annually during the fiscal fourth quarter, or more frequently if events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount.

We test goodwill for impairment at the reporting unit level, which is one level below the operating segment level, using a two-step quantitative approach. The first step involves comparing the fair value of a reporting unit with its carrying value. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit and is based on discounted cash flows or relative market-based approaches. These estimates are also subject to significant management judgment, including the determination of many factors such as sales growth rates, gross margin patterns, cost growth rates, terminal value assumptions and discount rates. If the carrying value of the reporting unit exceeds its fair value, the second step of the process involves a comparison of the implied fair value and carrying value of the goodwill of that reporting unit. If the carrying value of the goodwill of a reporting unit exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess.

The carrying value of goodwill was $3.3 million at March 31, 2016, which related entirely to our PG&A operating segment. In fiscal 2016, we determined there was an excess of fair value over carrying value. However, if actual results are not consistent with our estimates or assumptions, we may be exposed to an impairment charge that could be material. See Note 1, Summary of Significant Accounting Policies, and Note 4, Goodwill and Intangible Assets, of the Notes to Consolidated Financial Statements, included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K for further discussion of goodwill.

Long-Lived and Definite-Lived Intangible Assets

We review our long-lived and definite-lived intangible assets (individually or in a related asset group as appropriate) for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable from future cash flows attributable to the assets. An impairment charge for

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long-lived and definite-lived intangible assets is recognized only when the estimated fair value of an asset or asset group is less than its carrying amount.

In conducting the review of long-lived and definite-lived intangible assets for impairment, we first perform a qualitative assessment to determine whether it is more likely than not that the fair value of any individual asset or asset group is less than its carrying amount. Asset groups are determined based on the lowest level for which identifiable cash flows of the asset group are largely independent of the cash flows of other assets and liabilities. In conducting the initial qualitative assessment, we analyze actual and projected growth trends for net sales, gross margin, and earnings for each asset or asset group, as well as historical versus planned performance and other macroeconomic and business conditions that could potential impact financial results. The determination of whether a triggering event has occurred is subject to significant management judgment, including at which point a triggering event has occurred when the relevant adverse factors persist over extended periods.

If we conclude that the qualitative test indicates an impairment of long-lived or definite-lived intangible assets may exist, a quantitative test for impairment is performed. We test long-lived and definite-lived intangible assets for impairment by comparing the carrying values of the individual asset or asset group to the estimated undiscounted future cash flows. If the sum of the estimated undiscounted future cash flows is less than the carrying value of the long-lived or definite-lived intangible asset, we calculate an impairment loss. The impairment loss calculation compares the carrying value of the asset to its estimated fair value, which is typically based on estimated discounted future cash flows. We recognize an impairment loss if the amount of the asset’s carrying value exceeds the asset’s estimated fair value. If we recognize an impairment loss, the adjusted carrying amount of the asset becomes its new cost basis. For a depreciable asset, the new cost basis is depreciated over the remaining useful life of that asset. These estimates are subject to significant management judgment including the determination of many factors such as sales growth rates, gross margin patterns, cost growth rates, terminal value assumptions and discount rates. If actual results are not consistent with our estimates and assumptions, we may be exposed to impairments that could be material.

Product Warranties

We generally provide a limited warranty to the owner of snowmobiles for 12 months from the date of consumer registration and for six months from the date of consumer registration on ATVs and ROVs. We may provide longer warranties in certain geographical markets as determined by local regulations and market conditions, as well as related to certain promotional programs. Our limited warranties require us, or our dealers, to repair or replace defective parts or products during the warranty periods at no cost to the end consumers. We provide for estimated warranty costs at the time of sale to the dealer or distributor based on historical rates and trends and make subsequent adjustments to our estimate as actual claims become known or the amounts are determinable. The accrual for warranty costs was $24.8 million and $23.1 million at March 31, 2016 and 2015, respectively. While management believes that the warranty reserve is adequate and that the judgment applied is appropriate, adverse changes in actual warranty costs compared to our initial estimates could cause accrued warranty costs to materially change.

Inventories

We value our inventories at the lower of cost or market, with cost determined using the first-in, first-out method. Our inventories consist of materials and products that are subject to changes in our planned production of future snowmobile and ATV/ROV products and competitive market conditions which may cause lower of cost or market adjustments to our finished goods inventory. We periodically assess inventories for obsolescence and potential excess. This assessment is based primarily on assumptions and estimates regarding future production demands, anticipated changes in technology or design, and historical and expected future sales patterns. If market conditions or future demand are less favorable than our current expectations, additional inventory write-downs or reserves may be required, which could have an adverse effect on our reported results in the period the

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adjustments are made. Inventory items that are identified as obsolete or excess are reserved on our Consolidated Balance Sheet. Management believes the reserve balances are adequate; however, if actual outcomes are different than we anticipated, we may be exposed to losses or gains that could be material.

Product Liability and Litigation

We are subject to product liability and intellectual property claims, as well as other litigation in the normal course of business. We maintain insurance for product liability claims although we retain a self-insured retention accrual within the Consolidated Balance Sheet caption “Insurance” within accrued expenses. The estimated costs resulting from any losses not covered by insurance are charged to operating expenses when it is probable a loss has been incurred and the amount of the loss is reasonably determinable.

We utilize historical trends and other analysis to assist in determining the appropriate loss reserve estimate. Though management believes the product liability reserves are adequate and appropriate, adverse changes in the final determination of product liability or other claims made against us could have a material impact on our financial condition or results of operations.

Certain Information Concerning Off-Balance Sheet Arrangements

As of March 31, 2016, we did not have any relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities, which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. We are, therefore, not exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in these relationships.

Forward-Looking Statements

This Annual Report on Form 10-K, as well as our annual report to shareholders and future filings with the Securities and Exchange Commission, our press releases and oral statements made with the approval of an authorized executive officer, contain not only historical information, but also forward-looking statements that reflect our current views with respect to future events and financial performance and are intended to qualify for the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated. The words “aim,” “anticipate,” “believe,” “estimate” “expect,” “intend,” “plan,” and other expressions that indicate future events and trends identify forward-looking statements, including statements related to our fiscal 2017 outlook, business strategy, market position and product development. In particular, these include, among others, statements relating to our anticipated capital expenditures and capital improvement programs, research and development expenditures, strategic partnerships, product introductions and demand, the effect of weather conditions and dealer ordering processes on our net sales, legal proceedings, our expectations regarding financing arrangements, our wholesale and retail sales and market share expectations, performance opportunities, inventory levels, industry wholesale and retail sales and demand expectations, depreciation and amortization expense, dividends, the effect of foreign currency exchange rates, sufficiency of funds to finance our operations and capital expenditures, raw material and component supply expectations, adequacy of insurance, and the effect of regulations on us and our industry and our compliance with such regulations. Actual future results and trends may differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to the risk factors described in Item 1A, Risk Factors, of this Annual Report on Form 10-K.

We do not undertake any obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Exchange Rates and Interest Rates

Sales to Canadian dealers are made in Canadian dollars. During fiscal 2016, sales to Canadian dealers comprised 27.6% of total net sales. During fiscal 2016, the exchange rate fluctuation between the U.S. dollar and the Canadian dollar reduced operating income by approximately $25.8 million compared to a reduction of approximately $15.2 million in fiscal 2015. During fiscal 2016, we utilized cash flow hedges to mitigate the variability in Canadian exchange rate changes relating to Canadian dollar fund transfers to the United States. As of March 31, 2016, we had notional Canadian dollar (“CAD”) denominated cash flow hedges of approximately $87.9 million U.S. dollars (“USD”) with a weighted average contract exchange rate of 1.3567 CAD to USD. The fair values of the CAD contracts at March 31, 2016 represent an unrealized gain of $3.8 million. To monitor our Canadian currency exchange rate risks, we use sensitivity analysis, which measures the effect of devaluation of the Canadian dollar. A ten percent fluctuation in the currency rates as of March 31, 2016 would have resulted in a change in the fair value of the Canadian dollar hedge contracts of approximately $8.8 million. However, since these contracts hedge foreign currency denominated transactions, any change in the fair value of the contracts would be offset by changes in the underlying value of the transactions being hedged.

Sales to European on-road ATV dealers and distributors are made in Euros. During fiscal 2016, sales to European on-road ATV dealers comprised 9.9% of total net sales. The exchange rate fluctuation between the U.S. dollar and the Euro had a negative impact of $3.3 million on operating profit during fiscal 2016.

During fiscal 2016, approximately 8.7% of our total cost of goods sold was purchased from Japanese yen denominated suppliers. The majority of these purchases were made from Suzuki and Yamaha for engines for our snowmobiles. We have an agreement with Suzuki for snowmobile engine purchases to share the impact of fluctuations in the exchange rate between the U.S. dollar and the Japanese yen above and below a fixed range contained in the agreement. During fiscal 2016, the exchange rate fluctuation between the U.S. dollar and the Japanese yen had a modest positive impact on our operating results.

We are a party to a secured bank line of credit arrangement under which we currently may borrow up to an aggregate of $130.0 million. The amount of permissible borrowings under the credit facility are dependent upon adequate levels of underlying collateral. The total letters of credit issued, under this arrangement, at March 31, 2016 were $3.5 million. Interest is charged at variable rates based on either LIBOR or the prime rate. Because the interest rate risk related to the line of credit is not deemed to be significant, we do not actively manage this exposure.

Commodity Risk and Inflation

We are subject to market risk from fluctuating market prices of certain purchased commodity raw materials including steel, aluminum, petroleum based resins, and various fuels. In addition, we are a purchaser of components and parts containing various commodities, including steel, aluminum, rubber and others, which are integrated into our end products. While such materials are typically available from numerous suppliers, commodity raw materials are subject to price fluctuations. We generally purchase these commodities and components based upon current market prices that are established with the vendor in conjunction with the purchase process. We generally attempt to obtain firm pricing from the majority of our suppliers for volumes consistent with planned production. Inflation historically has not significantly impacted our business. We generally have been able to offset the impact of increasing costs through a combination of productivity gains and product price increases.

To the extent that commodity prices increase and we do not have firm pricing established with our suppliers, or our suppliers are not able to honor such prices, we may experience a decline in our gross margins to the extent we are not able to increase the selling prices of our products or obtain manufacturing efficiencies to offset increases in commodity costs. We intend to continue to closely monitor commodity and component prices that

27

affect our product lines and we anticipate average prices paid for commodities and components to be equivalent in fiscal 2017 as compared to fiscal 2016.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Management’s Report on Internal Control over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Exchange Act, for Arctic Cat Inc. and its subsidiaries. Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP.

Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Arctic Cat; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with U.S. generally accepted accounting principles, and that receipts and expenditures of Arctic Cat are being made only in accordance with authorizations of management and directors of Arctic Cat; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements, and even when determined to be effective, can only provide reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our internal control over financial reporting as of March 31, 2016. In making this evaluation, our management used the criteria for effective internal control over financial reporting described in the 2013 “Internal Control—Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this assessment, management concluded that our internal control over financial reporting was effective as of March 31, 2016.

Our internal control over financial reporting as of March 31, 2016 has been audited by Grant Thornton LLP, as stated in their report included elsewhere herein.

Signature	Date
/s/ CHRISTOPHER T. METZ	May 27, 2016
Christopher T. Metz President and Chief Executive Officer (principal executive officer)
/s/ CHRISTOPHER J. EPERJESY	May 27, 2016
Christopher J. Eperjesy Chief Financial Officer (principal financial officer)

Further discussion of our internal controls and procedures is included in Part II, Item 9A, Controls and Procedures, of this Annual Report on Form 10-K.

28

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Shareholders of

Arctic Cat Inc.

We have audited the internal control over financial reporting of Arctic Cat Inc. (a Minnesota corporation) and subsidiaries (the “Company”) as of March 31, 2016, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report of Internal Control over Financial Reporting (“Management’s Report”). Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 31, 2016, based on criteria established in the 2013 Internal Control—Integrated Framework issued by COSO.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements of the Company as of and for the year ended March 31, 2016, and our report dated May 27, 2016 expressed an unqualified opinion on those financial statements.

/s/ GRANT THORNTON LLP

Minneapolis, Minnesota

May 27, 2016

29

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Board of Directors and Shareholders of

Arctic Cat Inc.

We have audited the accompanying consolidated balance sheets of Arctic Cat Inc. (a Minnesota corporation) and subsidiaries (the “Company”) as of March 31, 2016 and 2015, and the related consolidated statements of operations, comprehensive income (loss), shareholders’ equity, and cash flows for each of the three years in the period ended March 31, 2016. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Arctic Cat Inc. and subsidiaries as of March 31, 2016 and 2015, and the results of their operations and their cash flows for each of the three years in the period ended March 31, 2016, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company’s internal control over financial reporting as of March 31, 2016, based on criteria established in the 2013 Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated May 27, 2016, expressed an unqualified opinion thereon.

/s/ GRANT THORNTON LLP

Minneapolis, Minnesota

May 27, 2016

30

ARCTIC CAT INC.

CONSOLIDATED BALANCE SHEETS

($ in thousands, except per share amounts)

	March 31,
	2016			2015
ASSETS
Current assets
Cash and cash equivalents	$	17,730		$	40,253
Short-term investments		—			1,009
Accounts receivable, less allowances		35,760			25,067
Inventories		140,007			152,443
Prepaid expenses		6,456			5,363
Income taxes receivable		11,765			5,151
Deferred income taxes		17,229			13,050
Other current assets		100			3,628
Total current assets		229,047			245,964
Property and equipment
Machinery, equipment and tooling		214,372			194,074
Land, buildings and improvements		33,259			30,004
		247,631			224,078
Less accumulated depreciation		166,144			161,210
		81,487			62,868
Goodwill		3,342			3,342
Intangible assets, net		2,855			3,237
Other assets		1,163			—
	$	317,894		$	315,411
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	72,012		$	70,257
Accrued expenses:
Marketing		9,087			14,495
Compensation		5,634			4,429
Warranties		24,809			23,062
Insurance		3,538			4,383
Other		8,950			5,463
Total current liabilities		124,030			122,089
Deferred income taxes		13,193			9,716
Other liabilities		13,280			3,234
Commitments and contingencies		—			—
Shareholders’ equity
Preferred stock, par value $1.00; 2,050,000 shares authorized; none issued		—			—
Preferred stock—Series B Junior Participating, par value $1.00; 450,000 shares authorized; none issued		—			—
Common stock, par value $.01; 37,440,000 shares authorized; shares issued and outstanding: 13,038,249 at March 31, 2016 and 12,949,702 at March 31, 2015		130			130
Additional paid-in-capital		6,105			1,940
Accumulated other comprehensive loss		(10,184	)		(7,142	)
Retained earnings		171,340			185,444
Total shareholders’ equity		167,391			180,372
	$	317,894		$	315,411

The accompanying notes are an integral part of these consolidated financial statements.

31

ARCTIC CAT INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

($ in thousands, except per share amounts)

	Years ended March 31,
	2016			2015			2014
Net sales
Snowmobile and ATV/ROV units	$	534,600		$	584,873		$	615,608
Parts, garments, and accessories		98,295			113,883			114,883
Total net sales		632,895			698,756			730,491
Cost of goods sold
Snowmobile and ATV/ROV units		476,194			505,383			506,707
Parts, garments, and accessories		66,034			73,924			72,705
Total cost of goods sold		542,228			579,307			579,412
Gross profit		90,667			119,449			151,079
Operating expenses
Selling and marketing		43,714			39,656			38,028
Research and development		27,162			24,341			23,998
General and administrative		36,005			48,914			28,557
Total operating expenses		106,881			112,911			90,583
Operating profit (loss)		(16,214	)		6,538			60,496
Other income (expense)
Interest income		15			25			30
Interest expense		(848	)		(353	)		(122	)
Total other expense		(833	)		(328	)		(92	)
Earnings (loss) before income taxes		(17,047	)		6,210			60,404
Income tax expense (benefit)		(7,860	)		1,290			21,000
Net earnings (loss)	$	(9,187	)	$	4,920		$	39,404
Net earnings (loss) per share
Basic	$	(0.71	)	$	0.38		$	2.97
Diluted	$	(0.71	)	$	0.38		$	2.90
Weighted average shares outstanding (in thousands)
Basic		12,995			12,926			13,275
Diluted		12,995			13,089			13,598

The accompanying notes are an integral part of these consolidated financial statements.

32

ARCTIC CAT INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

($ in thousands)

	Years ended March 31,
	2016			2015			2014
Net earnings (loss)	$	(9,187	)	$	4,920		$	39,404
Other comprehensive income (loss):
Foreign currency translation adjustments		1,387			(7,311	)		2,297
Unrealized gain (loss) on derivative instruments, net of tax		(4,429	)		2,279			(241	)
Comprehensive income (loss)	$	(12,229	)	$	(112	)	$	41,460

The accompanying notes are an integral part of these consolidated financial statements.

33

ARCTIC CAT INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

($ in thousands, except per share amounts)

Years ended March 31,	Common Stock						Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Retained Earnings			Total
	Shares			Amount
Balances at March 31, 2013		13,204		$	132		$	10,945		$	(4,166	)	$	167,561		$	174,472
Exercise of stock options		617			6			9,701			—			—			9,707
Tax benefits from stock options exercised		—			—			7,499			—			—			7,499
Repurchase of common stock		(959	)		(9	)		(30,729	)		—			(14,624	)		(45,362	)
Restricted stock awards and units		21			—			—			—			—			—
Restricted stock forfeited		—			—			—			—			—			—
Stock-based compensation expense		—			—			2,584			—			—			2,584
Net earnings		—			—			—			—			39,404			39,404
Unrealized loss on derivative instruments, net of tax		—			—			—			(241	)		—			(241	)
Foreign currency adjustment		—			—			—			2,297			—			2,297
Dividends ($0.40 per share)		—			—			—			—			(5,317	)		(5,317	)
Balances at March 31, 2014		12,883			129			—			(2,110	)		187,024			185,043
Exercise of stock options		95			1			1,451			—			—			1,452
Tax benefits from stock options exercised		—			—			287			—			—			287
Repurchase of common stock Repurchase of common stock		(83	)		(1	)		(3,158	)		—			—			(3,159	)
Restricted stock awards and units		57			1			(727	)		—			—			(726	)
Restricted stock forfeited		(3	)		—			—			—			—			—
Stock-based compensation expense		—			—			4,087			—			—			4,087
Net earnings		—			—			—			—			4,920			4,920
Unrealized gain on derivative instruments, net of tax		—			—			—			2,279			—			2,279
Foreign currency adjustment		—			—			—			(7,311	)		—			(7,311	)
Dividends ($0.50 per share)		—			—			—			—			(6,500	)		(6,500	)
Balances at March 31, 2015		12,949			130			1,940			(7,142	)		185,444			180,372
Exercise of stock options		38			—			582			—			—			582
Tax benefits from stock options exercised		—			—			(221	)		—			—			(221	)
Repurchase of common stock		(5	)		—			(136	)		—			—			(136	)
Restricted stock awards and units		58			—			(292	)		—			—			(292	)
Restricted stock forfeited		(2	)		—			—			—			—			—
Stock-based compensation expense		—			—			4,232			—			—			4,232
Net loss		—			—			—			—			(9,187	)		(9,187	)
Unrealized loss on derivative instruments, net of tax		—			—			—			(4,429	)		—			(4,429	)
Foreign currency adjustment		—			—			—			1,387			—			1,387
Dividends ($0.38 per share)		—			—			—			—			(4,917	)		(4,917	)
Balances at March 31, 2016		13,038		$	130		$	6,105		$	(10,184	)	$	171,340		$	167,391

The accompanying notes are an integral part of these consolidated financial statements.

34

ARCTIC CAT INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

($ in thousands)

	Years ended March 31,
	2016			2015			2014
Cash flows from operating activities
Net earnings (loss)	$	(9,187	)	$	4,920		$	39,404
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization		19,767			15,509			14,189
Loss on the disposal of assets		—			51			3
Deferred income taxes		1,613			1,489			6,076
Stock-based compensation expense		4,294			4,087			2,584
Proceeds from new market tax credit, net of deferred costs		4,403			—			—
Changes in operating assets and liabilities:
Trading securities		1,009			58,999			17,232
Accounts receivable		(10,221	)		14,813			(10,949	)
Inventories		13,320			(14,024	)		(42,159	)
Accounts payable		872			(21,617	)		26,768
Accrued expenses		(3,385	)		(188	)		(1,264	)
Income taxes		(6,694	)		(3,494	)		(6,931	)
Prepaid expenses and other		3,332			(844	)		(774	)
Net cash provided by operating activities		19,123			59,701			44,179
Cash flows from investing activities:
Purchases of property and equipment		(37,964	)		(22,187	)		(24,377	)
Acquisition of business		—			(8,428	)		—
Other		(2	)		(9	)		36
Net cash used in investing activities		(37,966	)		(30,624	)		(24,341	)
Cash flows from financing activities:
Proceeds from long-term borrowings		293,067			236,760			121,007
Payments on long-term borrowings		(293,067	)		(236,760	)		(121,007	)
Proceeds from issuance of common stock		582			34			185
Payments for income taxes on net-settled option exercises		(292	)		(1,897	)		(7,652	)
Tax benefit from stock option exercises		65			758			7,499
Dividends paid		(4,917	)		(6,500	)		(5,317	)
Repurchase of common stock		(136	)		(1,042	)		(28,190	)
Net cash used in financing activities		(4,698	)		(8,647	)		(33,475	)
Effect of exchange rate changes on cash and cash equivalents		1,018			(2,701	)		595
Net increase (decrease) in cash and cash equivalents		(22,523	)		17,729			(13,042	)
Cash and cash equivalents at beginning of year		40,253			22,524			35,566
Cash and cash equivalents at end of year	$	17,730		$	40,253		$	22,524
Supplemental disclosure of cash payments for:
Income taxes	$	168		$	3,271		$	13,892
Interest	$	848		$	353		$	122

The accompanying notes are an integral part of these consolidated statements.

35

ARCTIC CAT INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Unless the context otherwise requires, the use of the terms “Arctic Cat,” “we,” “our,” or “us” in these Notes to Consolidated Financial Statements refers to Arctic Cat Inc. and, as applicable, its consolidated subsidiaries.

Description of Business

Arctic Cat designs, engineers, manufactures and markets snowmobiles, all-terrain vehicles (ATVs), recreational off-highway vehicles (“side-by-sides” or “ROVs”) and related parts, garments and accessories (PG&A) under the Arctic Cat^® and MotorFist^® brand names. We market our products through a network of independent dealers located throughout the United States, Canada, and Europe and through distributors in Europe, the Middle East, Asia and other international markets.

Our business is organized into three operating segments based on our product lines: (1) snowmobile; (2) ATV/ROV and (3) PG&A. We aggregate the snowmobile and ATV/ROV segments into one operating segment, as the segments have similar economic characteristics. Accordingly, we have two reportable segments: (1) snowmobiles and ATV/ROV and (2) PG&A. See Note 11, Segment Reporting, for additional detail on our segments.

Basis of Presentation

The consolidated financial statements include the accounts of Arctic Cat Inc. and its consolidated subsidiaries. We also consolidate, regardless of our ownership percentage, variable interest entity’s (“VIE’s”) for which we are deemed to have a controlling financial interest. All intercompany accounts and transactions are eliminated upon consolidation.

When we obtain an economic interest in an entity, we evaluate the entity to determine if the entity is a VIE, and if we are deemed to be a primary beneficiary. As a part of our evaluation, we are required to qualitatively assess if we are the primary beneficiary of the VIE based on whether we hold the power to direct those matters that most significantly impacted the activities of the VIE and the obligation to absorb losses or the right to receive the benefits of the VIE that could potentially be significant. Refer to Note 12, New Market Tax Credit Transaction, for a description of the VIE included in our consolidated financial statements.

In preparing the accompanying consolidated financial statements, we evaluated the period from April 1, 2016, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. No such events were identified for this period.

Use of Estimates

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, related revenues and expenses and disclosure about contingent assets and liabilities at the date of the financial statements. We base our estimates on historical experience and on other various assumptions believed to be reasonable under the circumstances. We believe that such estimates are established using consistent, reasonable and appropriate methods. Accordingly, actual results could differ from the estimates used by management.

Reclassifications

Certain prior period Consolidated Balance Sheet and Notes to Consolidated Financial Statement amounts have been reclassified to conform to the fiscal 2016 financial statement presentation. The reclassifications had no effect on previously reported operating results.

36

Cash and Cash Equivalents

We consider highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. At times, certain bank deposits may be in excess of federally insured limits. As of March 31, 2016 and 2015, Arctic Cat had approximately $7.2 and $19.2 million, respectively, of cash located in foreign banks primarily in Europe and Canada.

Accounts Receivable and Allowance for Uncollectible Accounts

Our accounts receivable balance consists of amounts due from our dealers and finance companies. We extend credit to our dealers based on an evaluation of the dealers’ financial condition. Our collection exposure relating to accounts receivable amounts due from dealer floorplan finance institutions is limited due to the financial strength of the finance institutions and provisions of our existing agreements. Accounts receivable is presented net of an allowance for estimated uncollectible amounts due from our dealers. We estimate uncollectible amounts considering numerous factors, mainly the length of time the receivables are past due, the historical collection experience and existing economic conditions. Our allowance for uncollectible accounts was $1.8 and $1.9 million at March 31, 2016 and 2015, respectively. Account balances are charged off against the allowance when all collection efforts have been exhausted. Amounts which are considered to be uncollectible are written off and recoveries of amounts previously written off are credited to the allowance upon recovery. Accounts receivable amounts written off have been within management’s expectations.

The activity in the allowance for uncollectible accounts for accounts receivable is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,897		$	1,988
Provisions charged to expense		40			287
Deductions for amounts written-off		(143	)		(378	)
Balance at end of period	$	1,794		$	1,897

Inventories

Inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out method. Manufacturing costs include materials, labor, freight-in, and manufacturing overhead. Unallocated overhead and abnormal costs are expensed as incurred. Market represents the estimated selling price in the ordinary course of business less cost to sell and considers general market and economic conditions, reviews of current profitability of products, product warranty costs and the effect of current and expected incentive offers as of the balance sheet date. We establish a reserve for excess, slow-moving, and obsolete inventory that is equal to the difference between the cost and estimated net realizable value for that inventory. These reserves are based on a review and comparison of current inventory levels to planned production, as well as planned and historical sales of the inventory. Additionally, due to significant movements of partially-manufactured components and parts between manufacturing plants, we do not internally measure, nor do our accounting systems provide, a meaningful segregation between raw materials and work-in-process.

Inventories consist of the following at March 31 ($ in thousands):

	2016		2015
Raw materials and sub-assemblies	$	35,770	$	41,045
Finished goods		64,127		77,763
Parts, garments and accessories		40,110		33,635
	$	140,007	$	152,443

37

Losses resulting from the application of lower of cost or market accounting were not material for the years ended March 31, 2016, 2015 and 2014, respectively.

Derivative Instruments and Hedging Activities

We enter into forward exchange contracts to protect against exposure to currency fluctuations on transactions denominated in foreign currencies, namely the Canadian dollar and Japanese yen. The contracts are designated as, and meet the criteria for, cash flow hedges. We do not enter into forward contracts for the purpose of trading or speculative purposes. Derivatives are recognized on the Consolidated Balance Sheets at fair value, and the effective portion of the change in the fair value of the derivative is recorded in accumulated other comprehensive income (loss), net of tax, and subsequently reclassified into operating expense upon completing transfers of Canadian dollar or Japanese yen funds when the hedged item affects earnings.

Fair Value Measurements

We record certain assets and liabilities at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. A fair value hierarchy has been established, which requires classification based on observable and unobservable inputs when measuring fair value. Refer to Note 2, Fair Value Measurements, for additional information.

Property and Equipment, Net

Property and equipment is stated at cost. Major improvements that extend the useful life or add functionality are capitalized and repairs and maintenance cost that are considered not to extend the useful life of the property and equipment are expensed as incurred. Depreciation is provided in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives, using the straight-line method for all property, equipment and tooling. Tooling is depreciated over the life of the product, generally 3-5 years. Estimated service lives range from 15-39 years for buildings and improvements and 5-15 years for machinery and equipment. Accelerated and straight-line methods are used for income tax reporting. Upon disposal of property and equipment, the cost and accumulated depreciation are removed from the Consolidated Balance Sheets and the resulting gain or loss is reflected in earnings.

Impairment of Long-Lived Assets

Long-lived assets include property and equipment and definite-life intangible assets. We evaluate the carrying value of long-lived assets for impairment when events or changes in business circumstances indicate that the carrying amount of an asset, or asset group, may not be fully recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the assets, the carrying value is reduced to the estimated fair value as measured by quoted market prices or other valuation techniques (e.g., discounted cash flow analysis) and an accompanying impairment loss is recognized within earnings. Fair value is primarily determined using discounted cash flow analyses; however, other methods may be used to determine the fair value, including third party valuations when necessary. We recognized no impairment of long-lived assets in fiscal years 2016, 2015 and 2014.

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in a business combination. We test goodwill for impairment annually or more frequently if an event occurs or

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circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount.

Our impairment testing for goodwill is performed separately from our impairment testing of indefinite-lived intangible assets, but the income approach is utilized for both in determining fair value. We test goodwill and indefinite-lived intangible assets for impairment at the reporting unit level and individual indefinite-lived intangible asset level, respectively. Under the income approach, we calculate the fair value of our four reporting units and indefinite-lived intangible assets using the present value of future cash flows. Individual indefinite-lived intangible assets are tested by comparing the book values of each asset to the estimated fair value. Our estimate of fair value for indefinite-lived intangible assets uses projected revenues from our forecasting process, assumed royalty rates, and a discount rate. Assumptions in our impairment evaluations, such as forecasted growth rates and cost of capital, are consistent with internal projections and operating plans. Materially different assumptions regarding future performance of our businesses or a different weighted-average cost of capital could result in impairment losses or additional amortization expense.

We perform a two-step quantitative test for goodwill impairment. First, we compare the carrying value of a reporting unit, including goodwill, to its fair value. The fair value of each reporting unit is estimated using a discounted cash flow model. Where available, and as appropriate, comparable market multiples and our company’s market capitalization are also utilized to corroborate the results of the discounted cash flow models. If the first step indicates the carrying value exceeds the fair value of the reporting unit, then a second step must be completed in order to determine the amount of goodwill impairment that should be recorded. In the second step, the implied fair value of the reporting unit’s goodwill is determined by allocating the reporting unit’s fair value to all of its assets and liabilities other than goodwill. The implied fair value of the goodwill that results from the application of this second step is then compared to the carrying amount of the goodwill and an impairment charge is recorded for the difference.

Identifiable intangible assets are amortized over their useful lives on a straight-line basis, unless the useful life is determined to be indefinite. The useful life of an identifiable definite-lived intangible asset is based on an analysis of several factors, including contractual, regulatory or legal obligations, demand, competition, and industry trends. Refer to Note 4, Goodwill and Intangible Assets, for additional information.

Product Warranties

We generally provide a limited warranty on snowmobiles for 12 months from the date of consumer registration and for six months from the date of consumer registration on ATVs and ROVs. We may provide longer warranties in certain geographical markets as determined by local regulations and market conditions, as well as related to certain promotional programs. We provide for estimated warranty costs at the time of sale based on historical rates and trends. Subsequent adjustments are made to the warranty reserve as actual claims become known or the amounts are determinable, including costs associated with safety recalls, which may occur after the standard warranty period.

The following represents changes in our accrued warranty liability for the fiscal years 2016, 2015 and 2014 ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	23,062		$	19,357		$	18,709
Warranty provision		13,864			21,499			16,770
Warranty claim payments		(12,117	)		(17,794	)		(16,122	)
Balance at end of period	$	24,809		$	23,062		$	19,357

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Insurance

We are self-insured for certain losses relating to employee medical, workers’ compensation, and certain product liability claims. Specific stop loss coverages are provided for catastrophic claims in order to mitigate our exposure. Under these plans, liabilities are recognized for claims incurred, including those incurred but not reported. Losses and claims are charged to operations when it is probable a loss has been incurred and the amount can be reasonably estimated.

Revenue Recognition

We recognize revenue and provide for estimated marketing and sales incentive costs when persuasive evidence of an arrangement exists; delivery has occurred and ownership has transferred to the customer; the price to the customer is fixed or determinable; and collectability is reasonably assured. These criteria are generally met when title passes at the time product is shipped to dealers in accordance with shipping terms, which are primarily freight-on-board shipping point. Most sales are made to dealers financing their purchases under flooring arrangements with financial institutions.

At the time of revenue recognition, shipping and handling costs are recorded as a component of costs of goods sold and shipping charges to the dealers are recorded as revenue. Return allowances for parts, garments and accessories are recorded as a reduction of revenue when the revenue is recognized based on our return allowance program and historical experience.

Sales tax collected from customers is remitted to the appropriate taxing jurisdictions and is excluded from sales revenue as we consider ourselves a pass-through conduit for collecting and remitting sales taxes.

Marketing and Sales Incentive Costs

We provide for various marketing and sales incentive costs that are offered to our dealers and consumers at the later of when the revenue is recognized or when the marketing and sales incentive program is approved and communicated for products previously shipped. Examples of these costs, which are recognized as a reduction of revenue when the products are sold, include dealer and consumer rebates, dealer floorplan financing assistance and other incentive and promotional programs. Sales incentives that involve a free product or service delivered to the consumer, such as extended warranties, are recorded as a component of cost of goods sold.

We estimate the costs of these various marketing and sales incentive programs based on expected usage considering current program parameters, historical experience, dealer inventory levels, the terms of arrangements with dealers and expectations for changes in relevant trends in the future. Actual results may differ from these estimates if market conditions dictate the need to enhance or reduce sales promotion and incentive programs or if the current market trends vary from historical trends. To the extent current experience differs with previous estimates, the accrued liability for marketing and sales incentives is adjusted accordingly. Historically, marketing and sales incentive accruals have been within our expectations and differences have not been material.

Dealer Holdback

We provide for a dealer holdback program on product sales to our dealer network. The dealer holdback represents a portion of the invoiced sales price that is held by us and is expected to be subsequently returned to the dealer or distributor as a sales incentive upon the ultimate retail sale of the product to the end customer. Holdback amounts reduce the definitive net price of the products purchased by the dealers or distributors and ultimately reduce the amount of sales we recognize at the time of shipment. At the time product revenue is recognized, the portion of the invoiced sales price estimated as the holdback is accrued for as dealer holdback liability within accounts payable on our balance sheet. If the products subject to the holdback program are sold within the program’s term, we refund the holdback to the dealer. Any remaining holdback balances at the

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expiration of the program’s term are refunded to the dealer or distributor. Our dealer holdback program liability, included within accounts payable, was $17.2 million and $19.8 million as of March 31, 2016 and 2015, respectively.

Research and Development

Research and development costs and are expensed as incurred. Research and development expense was $27.2 million, $24.3 million and $24.0 million during fiscal 2016, 2015 and 2014, respectively.

Advertising

We expense advertising costs as incurred, except for cooperative advertising obligations arising related to the sale of our products to our dealers. The estimated cost of cooperative advertising, which the dealer is required to support, is recorded as marketing expense at the time the product is sold. Cooperative advertising was $3.0 million, $3.6 million and $3.4 million in fiscal 2016, 2015 and 2014, respectively. Total advertising expense, including cooperative advertising, was $19.5 million, $18.6 million and $17.6 million in fiscal 2016, 2015 and 2014, respectively.

Stock-Based Compensation

Our stock-based compensation awards are generally granted to executive officers, other employees, and non-employee members of the Board of Directors of Arctic Cat (the “Board”), and may include performance share awards that are contingent upon the achievement of performance goals of Arctic Cat. Compensation expense equal to the grant date fair value is recognized for these awards on a straight-line basis over the vesting period and is recorded within general and administrative expense. Refer to Note 7, Shareholders’ Equity, for additional information regarding our stock-based compensation plans.

Foreign Currency

Our activities with Canadian dealers are denominated in Canadian dollars and our activities with European on-road ATV/ROV dealers and distributors are denominated in the Euro. In addition, we have certain supply contracts that are denominated in Japanese yen. Assets and liabilities denominated in foreign currency are translated using the exchange rates in effect at the balance sheet date. Revenues and expenses are translated at the weighted-average foreign exchange rates in effect for the period. Translation gains and losses relating to the Canadian dollar and Japanese yen are reflected in the results of operations and Euro currency are reflected as a component of other comprehensive income.

Income Taxes

Deferred income tax assets and liabilities are recognized for the expected future income tax consequences of events attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Under this method, deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years that those temporary differences are expected to be recovered or settled. Judgment is required in assessing the future tax consequences of events that have been recognized in our financial statements or tax returns. Fluctuations in the ultimate outcome of these tax consequences could materially impact our financial position or results of operations. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period in which the enactment takes place. Valuation allowances are provided when, in management’s judgment, it is more likely than not that some portion or all of the benefit of the deferred tax asset will not be recognized.

We recognize the effect of uncertain income tax positions only if the weight of available evidence of those positions indicates that it is more likely than not that the position will be sustained on audit, including resolution

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of related appeals or litigation processes, if any. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized upon settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. It is inherently difficult and subjective to estimate such amounts, as we have to determine the probability of various possible outcomes. We reevaluate these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit, voluntary settlements and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. We also record interest and penalties related to unrecognized tax benefits in income tax expense.

Recent Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes and statutory tax withholding requirements and classification within the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2016. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

In February 2016, the FASB issued ASU 2016-02, Lease Accounting, which requires lessees to recognize on the balance sheet certain operating and financing lease liabilities and corresponding right-of-use assets that have lease terms of greater than 12 months. This topic retains the distinction between finance leases and operating leases. The ASU is effective on a modified retrospective approach for annual periods beginning after December 15, 2018, and interim periods therein, with early adoption permitted. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results, noting that we currently expect the majority of our operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon our adoption of ASU 2016-02.

In November 2015, the FASB issued ASU 2015-17, Income Taxes, which provides guidance for the presentation of deferred tax assets and liabilities within the statement of financial position. The ASU requires companies to classify deferred tax assets and liabilities as noncurrent in a classified statement of financial position. The current requirement that deferred tax assets and liabilities of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this ASU. The ASU simplifies the current guidance, which requires entities to separate deferred income tax assets and liabilities into current and noncurrent amounts in a classified statement of financial position. The ASU is effective prospectively or retrospectively for annual periods beginning after December 15, 2016, and interim periods therein, with early adoption permitted. The adoption of the ASU will change the classification of deferred income taxes within our Consolidated Balance Sheets; however, we do not expect the adoption of the ASU to have a material impact on our results of operations or cash flows.

In July 2015, the FASB issued ASU 2015-11, Inventory, which provides guidance for the measurement of inventory. The ASU requires entities to measure most inventory at the lower of cost or net realizable value. The ASU simplifies the current guidance, which requires entities to measure inventory at the lower of cost or market (with market defined as one of three different measures). The ASU is effective prospectively for annual and interim periods beginning after December 15, 2016, and interim periods therein. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which provides guidance for revenue recognition that supersedes existing revenue recognition guidance (but does not apply to nor supersede accounting guidance for lease contracts). The ASU’s core principle is that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and

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uncertainty of revenue and cash flows arising from contracts with customers. In July 2015, the FASB approved a proposal to defer the effective date of the ASU by one year to reporting periods beginning after December 15, 2018. The ASU should be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

2. FAIR VALUE MEASUREMENTS

We record certain assets and liabilities at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. A fair value hierarchy has been established, which requires classification based on observable and unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

In determining the fair value of assets and liabilities, we utilize various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Financial instruments are transferred in and/or out of Level 1, 2 or 3 at the beginning of the accounting period in which there is a change in the valuation inputs.

Recurring Fair Value Measurements

We utilize the income approach to measure the fair value of our foreign currency contracts, which is based on significant other observable inputs. As such, our foreign currency contracts are considered a Level 2 measurement. As of March 31, 2016, our Canadian dollar foreign currency contracts fair value represented a foreign exchange asset of $0.1 million and a foreign exchange liability of $3.9 million. As of March 31, 2015, our Canadian dollar foreign currency contracts fair value represented a foreign exchange asset totaling $3.6 million, and our Japanese yen foreign currency contract fair value was a foreign exchange liability totaling $0.4 million.

Nonrecurring Fair Value Measurements

Our assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to tangible fixed assets, goodwill and intangible assets, which are generally recorded at fair value as a result of an impairment charge. We did not record any significant charges to assets measured at fair value on a nonrecurring basis during fiscal 2016 and 2015.

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Other Fair Value Disclosures

Our financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable and accounts payable and approximate fair value due to their short-term nature.

3. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We use foreign currency derivative instruments to manage our exposure to currency fluctuations on transactions denominated in foreign currencies – primarily the Canadian dollar and Japanese yen. Our foreign currency management objective is to reduce earnings volatility related to movements in foreign exchange rates and limit the risk of loss in value of certain of our foreign currency-denominated cash flows. We do not enter into forward contracts for trading or speculative purposes. We have no derivatives that have credit risk-related contingent features and we mitigate our risk by engaging with major financial institutions as counterparties.

We record all foreign currency forward contracts at fair value in our Consolidated Balance Sheets. The forward contracts are designated as, and meet the criteria for, cash flow hedges. We evaluate hedge effectiveness prospectively and retrospectively, and we formally document all hedging relationships at inception, as well as the risk management objectives for undertaking the hedge transaction. Our Canadian dollar and Japanese yen forward contracts generally have terms of up to 12 months. Gains and losses on forward contracts are recorded in accumulated other comprehensive income (loss), net of tax, and subsequently reclassified into cost of goods sold or operating expenses during the same period in which the hedged transaction affects the Consolidated Statements of Operations. Gains and losses on the derivative representing hedge ineffectiveness, if any, are recognized in the Consolidated Statements of Operations.

The following table presents the notional amounts and gross carrying values of derivative instruments as of March 31, 2016 and March 31, 2015 ($ in thousands):

	March 31, 2016					March 31, 2015
	Notional Amount (in US Dollars)		Fair Value Asset (Liability), Net (2)			Notional Amount (in US Dollars)		Fair Value Asset (Liability), Net (2)
Canadian Dollar (1)	$	87,875	$	(3,837	)	$	76,328	$	3,628
Japanese Yen (1)		—		—			19,046		(434	)

(1) Assets are included in other current assets and liabilities are included in accrued expenses in the accompanying Consolidated Balance Sheets.

(2) Refer to Note 2, Fair Value Measurements, for additional information on the fair value of our derivative instruments.

The following table presents the effects of derivative instruments on other comprehensive income (OCI) and on our Consolidated Statements of Operations for the years ended March 31, 2016, 2015 and 2014 ($ in thousands):

	March 31, 2016						March 31, 2015
	Pre-Tax Gain (Loss) Recognized in OCI			Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)			Pre-Tax Gain (Loss) Recognized in OCI		Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)
Canadian Dollar (1)	$	(111	)	$	7,354		$	6,047	$	1,996
Japanese Yen (1)		(374	)		(808	)		—		—

(1) Canadian Dollar contracts are included in general and administrative expenses and Japanese Yen contracts are included in cost of goods sold in the accompanying Consolidated Statements of Operations.

The ineffective portion of foreign currency contracts was not material for the years ended March 31, 2016 and 2015.

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4. GOODWILL AND INTANGIBLE ASSETS

We do not amortize goodwill or intangible assets with indefinite useful lives, but instead we review these assets for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable through future cash flows. An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount. We conducted our annual assessment for goodwill impairment during the fourth quarter of fiscal 2016 and concluded that goodwill was not impaired.

The changes in the carrying amount of goodwill for the years ended March 31, 2016 and 2015 are as follows ($ in thousands):

	2016		2015
	Gross Carrying Amount		Gross Carrying Amount
Balance as of beginning of year	$	3,342	$	—
Goodwill acquired during the period		—		3,342
Balance as of end of year	$	3,342	$	3,342

The carrying amount of indefinite-lived intangible assets as of March 31, 2016 and 2015 are as follows ($ in thousands):

	2016		2015
	Gross Carrying Amount		Gross Carrying Amount
Indefinite-lived intangible asset balance as of end of year	$	436	$	436

For definite-lived intangible assets, the changes in the net carrying amount for the years ended March 31, 2016 and 2015 are as follows ($ in thousands):

	2016					2015
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount			Accumulated Amortization
Balance as of beginning of year	$	4,312	$	(1,511	)	$	2,058		$	(1,428	)
Intangible assets acquired during the period		—		—			2,255			—
Amortization expense		—		(385	)		—			(83	)
Currency translation effect on foreign balances		3		—			(1	)		—
Balance as of end of year	$	4,315	$	(1,896	)	$	4,312		$	(1,511	)

Definite-lived intangible assets include trademarks/tradenames, dealer network, customer relationships, non-compete agreements and in-process research and development. Amortization expense is expected to be approximately $0.4 million for fiscal 2017, 2018, 2019 and 2020 and approximately $0.3 million for fiscal 2021. The expected amortization expense is an estimate and actual amounts could differ due to additional intangible asset acquisitions, changes in foreign currency rates or impairment of intangible assets.

5. FINANCING

We rely on a senior secured revolving credit facility for documentary and stand-by letters of credit, working capital needs and general corporate purposes. On March 10, 2016, we amended our credit facility to extend the maturity date from November 10, 2017 to March 10, 2021 and increase our maximum permissible borrowings from $100.0 million to $130.0 million during May through November and from $50.0 million to $75.0 million

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during all other months of the fiscal year. The amount of permissible borrowings under the credit facility are dependent upon adequate levels of underlying collateral. Borrowings under the credit facility bear interest at either the base rate plus the applicable margin or the LIBOR rate plus the applicable margin, depending on the type of loan. The applicable margin is calculated based on Arctic Cat’s leverage ratio and amount available for borrowing under the credit facility and ranges from 0.0% to 0.5% for base rate loans and from 1.0% to 1.5% for LIBOR loans. Arctic Cat’s leverage ratio is its ratio of debt to EBITDA, calculated quarterly.

All borrowings are collateralized by substantially all of our assets including all real estate, accounts receivable and inventory. No borrowings from the line of credit were outstanding at March 31, 2016 and 2015. The outstanding letters of credit balances were $3.5 million and $7.9 million at March 31, 2016 and 2015, respectively, and borrowings under the line are subject to certain covenants and restrictions on indebtedness, financial guarantees, business combinations and other related items. We were in compliance with the terms of the credit agreement as of March 31, 2016.

6. LEASES

We lease buildings and equipment under non-cancelable operating leases. Certain of our lease agreements contain provisions for escalating rent payments over the initial terms of the lease. We account for these leases by recognizing rent expense on a straight-line basis and adjusting the deferred rent expense liability for the difference between the straight-line rent expense and the amount of rent paid. Total rent expense under our lease agreements was $1.4 million, $1.9 million and $1.4 million for fiscal 2016, 2015 and 2014, respectively.

Future minimum lease payments, exclusive of other costs required under non-cancelable operating leases are as follows ($ in thousands):

Fiscal year
2017	$	1,490
2018		1,383
2019		1,248
2020		1,234
2021		1,182
Thereafter		9,042
Total future minimum payments	$	15,579

7. SHAREHOLDERS’ EQUITY

Stock Compensation Plans

We have outstanding equity awards under a 2013 Omnibus Stock and Incentive Plan (the “2013 Plan”) and a 2007 Omnibus Stock and Incentive Plan (the “2007 Plan,” and along with the 2013 Plan, the “Plans”), previously approved by our shareholders. The Plans provide for incentive and non-qualified stock options, restricted stock and restricted stock unit awards and other incentive awards to be granted to directors, officers, other key employees and consultants. The stock options granted generally vest over a period of one to three years, have an exercise price equal to the fair market value of the stock on the date of grant and expire after a five to ten year life. The stock options are generally subject to accelerated vesting if there is a change in control, as defined in the plans. The restricted stock awards generally vest over a period of two to three years and do not require cash payments from restricted stock award recipients. Stock appreciation rights (“SARs”) generally vest over a period of three years. At March 31, 2016, we had 620,703 shares of common stock available for grant under the plans.

We record stock-based compensation expense related to stock options, restricted stock and restricted stock units over the requisite service period based on the fair value of the awards on the grant date. The fair value of restricted stock awards is based on the closing price of our common shares on the grant date. We record

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stock-based compensation expense related to cash-settled SARs over the requisite service period based on the fair value of the awards at the end of each reporting period. The fair value of restricted stock awards is based on the closing price of our common shares on the grant date. The fair value of stock option and SARs is estimated on the grant date using the Black-Scholes options pricing model, which includes assumptions regarding the risk-free interest rate, dividend yield, life of the award and the volatility of our common shares.

For the fiscal years ended March 31, 2016, 2015 and 2014, we recorded stock-based compensation expense for stock options, restricted stock and SAR awards of $4.3 million, $4.1 million and $2.6 million, respectively, which have been included in general and administrative expenses. At March 31, 2016, we had $9.3 million of unrecognized compensation costs related to non-vested stock options, restricted stock and SARs awards that are expected to be recognized over a weighted average period of approximately two years.

Stock Options

The following tables summarize the stock option transactions under the Plans during fiscal 2016:

	Number of Shares Under Option			Weighted Average Exercise Price
Outstanding at March 31, 2015		604,218		$	29.39
Granted		121,819			29.57
Cancelled		(10,356	)		36.39
Expired		(30	)		13.59
Exercised		(37,442	)		15.52
Outstanding at March 31, 2016		678,209		$	30.08
Options exercisable at March 31, 2016		262,734		$	17.83
Options expected to vest at March 31, 2016		266,806		$	20.30

Stock options outstanding had an aggregate intrinsic value of $0.5 million, $5.3 million and $10.9 million and a weighted-average contractual life of 7.48 years, 8.03 years and 5.09 years at March 31, 2016, 2015 and 2014, respectively. Exercisable stock options had an aggregate intrinsic value of $0.4 million at March 31, 2016 and a weighted-average contractual life of 6.32 years. The aggregate intrinsic value is based on the difference between the exercise price and our March 31, 2016 common share market value for in-the-money options.

The following tables summarize information concerning currently outstanding and exercisable stock options at March 31, 2016:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$6.26 - 9.57		3,827		3.34 years	$	6.28		3,827	$	6.28
10.79 - 16.45		145,762		5.09 years		13.97		132,180		13.71
17.78 - 27.69		63,051		7.40 years		21.29		48,029		21.72
28.81 - 43.79		432,035		8.32 years		35.65		160,645		38.21
47.52 - 47.52		33,534		7.63 years		47.52		12,228		47.52
		678,209		7.48 years	$	30.08		356,909	$	26.90

The fair value of each stock option award was estimated on the date of grant using the Black-Scholes options pricing model. The expected term of options granted is the safe harbor period. The volatility is based on historic volatilities from the traded shares of Arctic Cat over the past six years. The risk-free interest rate for

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periods matching the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Expected dividend is based on the historic dividend of Arctic Cat, as well as our expectation of future dividends as of the grant date of each stock option award. We have analyzed the forfeitures of stock and option grants and have used a 10% forfeiture rate in the expense calculation.

The weighted average fair value of options granted and the assumptions used to estimate the fair value of options for fiscal 2016, 2015 and 2014 are summarized as follows:

	2016			2015			2014
Fair value of options granted	$	13.35		$	15.24		$	16.91
Assumptions:
Dividend yield		1.2	%		1.0	%		1.0	%
Average term		6 years			6 years			5 years
Volatility		51.0	%		49.0	%		49.0	%
Risk-free rate of return		1.7	%		0.8	%		0.8	%

Restricted Stock

The shares of restricted common stock awarded have voting rights and participate equally in all dividends and other distributions duly declared by the Board.

The following tables summarize restricted stock and restricted stock unit award activity under the Plans for fiscal 2016 and 2015:

	2016					2015
Restricted Shares	Shares			Weighted- Average Grant  Date Fair Value		Shares			Weighted- Average Grant  Date Fair Value
Non-vested shares at March 31,		22,500		$	40.12		16,200		$	43.45
Awarded		29,063			18.53		20,200			33.67
Vested		(9,800	)		48.75		(10,900	)		33.81
Forfeited		(1,900	)		24.84		(3,000	)		37.60
Non-vested shares at March 31,		39,863		$	22.98		22,500		$	40.12

	2016					2015
Restricted Stock Units	Shares			Weighted- Average Grant  Date Fair Value		Shares			Weighted- Average Grant  Date Fair Value
Non-vested shares at March 31,		116,439		$	35.67		40,103		$	35.35
Granted		124,558			18.09		135,564			34.81
Vested		(44,722	)		36.15		(57,295	)		33.14
Forfeited		(10,017	)		16.59		(1,933	)		43.81
Non-vested shares at March 31,		186,258		$	24.79		116,439		$	35.67

Cash-Settled Stock Appreciation Rights

In February 2016, we granted 175,000 cash-settled SARs with an exercise price equal to the closing price of Arctic Cat common stock on the date of grant. The cash-settled SARs vest in three equal annual installments beginning on the first anniversary of the grant date and have a five-year term. Upon exercise, the holder is entitled to receive cash proceeds in an amount equal to the difference between (i) the lower of $33.00 and the

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then-current market value of Arctic Cat common stock and (ii) the fair market value of Arctic Cat common stock on the grant date of February 5, 2016, multiplied by the number of SARs exercised on such date. The cash-settled SARs are included in other liabilities in our Consolidated Balance Sheets and are recorded at fair value at the reporting date.

The following table summarizes the activity during fiscal 2016 for SARs awarded pursuant to the Plans:

	Number of SARs		Weighted Average Exercise Price		Weighted Average Contractual Term
Outstanding at March 31, 2015		—	$	—
Granted		175,000		14.16
Forfeited		—		—
Exercised		—		—
Outstanding at March 31, 2016		175,000	$	14.16		4.9 years
SARs exercisable at March 31, 2016		—	$	—		—
SARs expected to vest at March 31, 2016		144,468	$	14.16		4.9 years

The fair value of the SAR grant was estimated using the Black-Scholes option pricing model and assumptions analogous to our stock option awards, as set forth in the table below:

	2016
Fair value of SARs granted	$	6.40
Assumptions:
Dividend yield		0.0	%
Average term		5 years
Volatility		51.0	%
Risk-free rate of return		1.4	%

Preferred Stock

Our Board is authorized to issue 2,500,000 shares of $1.00 par value preferred stock in one or more series, 450,000 shares of which were designated Series B Junior Participating preferred stock in connection with the previous Shareholder Rights Plan. The Board can determine voting, conversion, dividend and redemption rights and other preferences of each series. No shares have been issued.

Share Repurchase Authorization

On August 7, 2014, the Board authorized the repurchase of an additional $25.0 million in shares of common stock, which supplemented the $1.1 million remaining under the program previously approved in May 2013. We paid $0.1 million, $1.0 million and $28.2 million during fiscal 2016, 2015, and 2014, respectively, to repurchase and cancel 5,162, 27,925 and 633,816 shares of common stock, respectively, pursuant to the Board authorizations. At March 31, 2016, we have remaining authorization to repurchase $25.9 million in shares of common stock.

Net Earnings (Loss) Per Share

Our basic net earnings (loss) per share is computed by dividing net earnings (loss) by the weighted average number of outstanding common shares. Our diluted weighted average shares outstanding include common shares and common share equivalents relating to stock options and restricted stock units, when dilutive. Options to purchase 449,432 and 156,432 shares of common stock with weighted average exercise prices of $35.50 and

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$44.14 were outstanding during fiscal 2016 and 2015, respectively, but were excluded from the computation of common share equivalents because they were anti-dilutive. No options outstanding were excluded from the computation of common share equivalents during fiscal 2014.

Weighted average shares outstanding consist of the following for the fiscal 2016, 2015 and 2014 (in thousands):

	2016		2015		2014
Weighted average number of common shares outstanding		12,995		12,926		13,275
Dilutive effect of option plan		—		163		323
Common and potential shares outstanding—diluted		12,995		13,089		13,598

Accumulated Other Comprehensive Loss

The components of the changes in accumulated other comprehensive loss during fiscal 2016, 2015 and 2014 were as follows ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	(7,142	)	$	(2,110	)	$	(4,166	)
Unrealized gain (loss) on derivative instruments, net of tax		(4,429	)		2,279			(241	)
Foreign currency translation adjustment		1,387			(7,311	)		2,297
Balance at end of period	$	(10,184	)	$	(7,142	)	$	(2,110	)

The unrealized gains on derivatives instruments in fiscal 2016, 2015 and 2014 were net of tax expense of $2.6 million, $1.3 million and $0.1 million, respectively. There is no tax impact on foreign currency translation adjustments, as the earnings are considered permanently reinvested.

8. RETIREMENT SAVINGS PLAN

We sponsor a 401(k) defined contribution plan that covers substantially all full-time employees who are at least 18 years of age and who have completed at least three months of service. Plan participants may make before tax elective contributions up to 50% of their compensation with Arctic Cat matching 50% of the employee contributions, up to a maximum of 5% of the employee’s cash compensation capped at $255,000. Matching contributions of $1.3 million, $1.2 million, and $1.0 million were made in fiscal 2016, 2015 and 2014, respectively. We can elect to make additional contributions at our discretion.

9. INCOME TAXES

Our income (loss) before income taxes was generated from our United States and foreign operations as follows ($ in thousands):

	For the years ended March 31,
	2016			2015		2014
United States	$	(17,156	)	$	5,532	$	58,655
Foreign		109			678		1,749
Income (loss) before income taxes	$	(17,047	)	$	6,210	$	60,404

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Income tax expense (benefit) consists of the following for the fiscal years ended March 31 ($ in thousands):

	2016			2015			2014
Current
Federal	$	(5,935	)	$	2,610		$	13,345
State		(339	)		149			900
Foreign		27			168			436
Deferred		(1,613	)		(1,637	)		6,319
Total income tax expense (benefit)	$	(7,860	)	$	1,290		$	21,000

The following is a reconciliation of the federal statutory income tax rate to the effective tax rate for the fiscal years ended March 31:

	2016			2015			2014
Statutory income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.8			1.9			1.7
Research and other tax credit		5.6			(16.5	)		(1.0	)
Domestic manufacturers deduction		(0.1	)		(0.9	)		(1.4	)
Uncertain tax positions		6.0			(2.3	)		(0.1	)
US subpart F adjustments		0.7			11.1			0.4
Foreign tax rate difference		(1.4	)		(9.1	)		(0.2	)
Stock options		(0.5	)		1.3			(0.1	)
Other		(1.1	)		0.3			0.5
		46.0	%		20.8	%		34.8	%

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We utilize the liability method of accounting for income taxes whereby deferred taxes are determined based on the estimated future tax effects of differences between the financial statement and tax bases of assets and liabilities given the provisions of enacted tax laws. The cumulative temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes under the liability method are as follows at March 31 ($ in thousands):

	2016			2015
Current deferred income tax assets
Accrued expenses	$	3,788		$	3,934
Accrued warranty		8,855			8,045
Inventory related items		4,269			4,152
Net operating loss carryforwards		1,628			—
Other		1,560			313
Less: valuation allowance		(351	)		(235	)
Current deferred income tax asset		19,749			16,209
Current deferred income tax liabilities
Prepaid expenses		2,043			1,463
Other		477			1,696
Current deferred income tax liability		2,520			3,159
Net current deferred tax asset	$	17,229		$	13,050
Non-current deferred income tax assets
Compensation payable in common stock	$	1,927		$	1,200
State research and development credits		1,393			1,043
Less: valuation allowance		(1,042	)		(808	)
Non-current deferred income tax asset		2,278			1,435
Non-current deferred income tax liability
Property and equipment		15,471			11,151
Non-current deferred tax liability		15,471			11,151
Net non-current deferred tax liability	$	13,193		$	9,716

Arctic Cat recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. We recognize potential interest and penalties related to income tax positions as a component of the provision for income taxes on the consolidated statements of operations.

We had liabilities recorded related to unrecognized tax benefits totaling $1.1 and $2.2 million at March 31, 2016 and 2015, including reserves related to potential interest and penalties of $0.1 and $0.4 million, respectively. The amount of the liability, net of federal benefits for uncertain state tax positions, at March 31, 2016, if recognized, would affect our effective tax rate. Arctic Cat currently anticipates approximately $0.3 million of unrecognized tax benefits will be recognized during the next twelve months. We have state research and development credit carryforwards of $1.4 and $1.0 million offset by valuation allowances as of March 31, 2016 and 2015, respectively, with expiration dates to March 2031. With few exceptions, we are no longer subject to federal, state, or foreign income tax examinations for years prior to March 31, 2012.

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A reconciliation of the amount of unrecognized tax benefits excluding interest and penalties is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,828		$	1,707
Increases related to prior year tax positions		50			72
Decreases related to prior year tax positions		(1,033	)		(143	)
Increases related to current year tax positions		200			192
Settlements		—			—
Balance at end of period	$	1,045		$	1,828

Arctic Cat is subject to income taxes in the U.S. federal jurisdiction, and various state jurisdictions, as well as various European jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the relevant tax laws and regulations and require significant judgment to apply.

10. COMMITMENTS AND CONTINGENCIES

Product Liability and Litigation

We are subject to product liability and intellectual property legal proceedings and claims, as well as other litigation, arising in the normal course of business. Such matters are generally subject to uncertainties and to outcomes that are not predictable and that may not be known for extended periods of time. Litigation occasionally involves claims for punitive, as well as compensatory, damages arising out of the use of our products. Although we are self-insured to some extent, we maintain insurance against certain product liability losses. We are also typically involved in patent litigation cases in which we are asserting, or defending, against patent infringement claims. To prevent possible future infringement of our patents by competitors, we periodically review competitor’s products. To avoid potential liability with respect to competitors’ patents, we regularly review certain patents issued by the United States Patent and Trademark Office and foreign patent offices. Management believes these activities help minimize our risk of being a defendant in patent infringement litigation. We are currently involved in patent litigation cases, including cases by or against competitors, where we are asserting and defending against claims of patent infringement. Such cases are at varying stages in the litigation process.

We record a reserve in accrued expenses in the Consolidated Balance Sheets based on our estimated range of potential exposures related to claims, including future legal expenditures, settlement and judgments, for which we are aware of, have assessed that a loss is probable and an amount can be reasonably estimated. We utilize historical trends and other analysis to assist in determining the appropriate loss reserve estimate. Should any settlement occur that exceeds our estimate or a new claim arise, we may need to adjust our overall reserve and, depending on the amount, such adjustment could be material. We are not involved in any legal proceedings which we believe will have a materially adverse impact on our business or financial condition, results of operations or cash flows.

Dealer Financing

Finance companies provide our North American dealers with floorplan financing. We have agreements with these finance companies to repurchase certain repossessed products sold to our dealers. At March 31, 2016, we are contingently liable under these agreements for a maximum repurchase amount of approximately $68.5 million. Our financial exposure under these agreements is limited to the difference between the amount paid to the finance companies for repurchases and the amount received upon the resale of the repossessed product. Losses incurred under these agreements during the periods presented have not been material. The financing agreements also have loss sharing provisions should any dealer default, whereby we share certain losses with the finance companies. The maximum liability to us under these provisions is approximately $2.2 million at March 31, 2016.

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Purchase Obligations

We enter into non-cancelable purchase commitments with certain of our suppliers for materials and supplies as part of the normal course of business. As of March 31, 2016, our purchase obligation under the non-cancelable purchase commitments was $45.1 million.

11. SEGMENT REPORTING

The presentation of segment information represents our method of internal reporting for making operating decisions and assessing performance, which generally segregates the operating segments by product line. The internal reporting of these operating segments is based, in part, on the management process utilized by our President and Chief Executive Officer, who is our chief operating decision maker. Based on this management process, we have two operating segments: (1) Snowmobile and ATV/ROV and (2) PG&A, which also represent our two reportable segments.

We aggregate our snowmobile and ATV/ROV operating segments into one operating segment, as the segments have similar economic characteristics. Given the crossover of customers, manufacturing and asset management, we do not maintain separate balance sheets for each segment. Accordingly, the segment information presented below is limited to sales and gross profit data ($ in thousands).

	Years ended March 31,
	2016		2015		2014
Net sales
Snowmobile and ATV/ROV units	$	534,600	$	584,873	$	615,608
PG&A		98,295		113,883		114,883
Total net sales		632,895		698,756		730,491
Cost of goods sold
Snowmobile and ATV/ROV units		476,194		505,383		506,707
PG&A		66,034		73,924		72,705
Total cost of goods sold		542,228		579,307		579,412
Gross profit
Snowmobile and ATV/ROV units		58,406		79,490		108,901
PG&A		32,261		39,959		42,178
Total gross profit	$	90,667	$	119,449	$	151,079

	Years ended March 31,
	2016		2015		2014
Net sales by product line
Snowmobile units	$	258,788	$	300,731	$	282,442
ATV/ROV units		275,812		284,142		333,166
PG&A		98,295		113,883		114,883
Total net sales	$	632,895	$	698,756	$	730,491

	Years ended March 31,
	2016		2015		2014
Net sales by geography, based on location of the customer
United States	$	395,684	$	420,687	$	404,347
Canada		174,658		192,524		215,631
Europe and other		62,553		85,545		110,513
Total net sales	$	632,895	$	698,756	$	730,491

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During fiscal 2016, no individual customer accounted for greater than 10% of our net sales. Sales to Yamaha and its subsidiaries in the aggregate accounted for 10.4% of net sales in fiscal year 2015. No sales to an individual customer accounted for more than 10% of fiscal year 2014 net sales.

Property and equipment, net, by geography are presented in the table below ($ in thousands):

	Years ended March 31,
	2016		2015
Long-lived assets by geography
United States	$	88,623	$	69,113
Canada and Europe		223		336
Total long-lived assets	$	88,846	$	69,449

12. NEW MARKET TAX CREDIT TRANSACTION

In February 2016, we entered into a transaction with Wells Fargo Community Development Enterprises, Inc. (“Wells Fargo” or “investors”), related to an investment in equipment at our manufacturing facility in Thief River Falls, Minnesota (the “project”). As part of the transaction, Wells Fargo made a contribution to and Arctic Cat Sales Inc. made a loan to, WF Paint & Assembly Investment Fund, LLC (the “Investment Fund”) under the New Market Tax Credit (“NMTC”) program. The NMTC program was provided for in the Community Renewal Tax Relief Act of 2000 (the “Act”) and is intended to induce investment in low-income communities. The Act permits taxpayers, whether companies or individuals, to claim credits against their federal income taxes for up to 39% of qualified investments in the equity of community development entities (“CDEs”). CDEs are privately managed investment institutions that are certified to make qualified low-income community investments.

In connection with the transaction, Arctic Cat Sales Inc. loaned $10.8 million to the Investment Fund at an interest rate of 3.75% per year and with a maturity of June 30, 2032. The Investment Fund then contributed the loan to certain CDEs, which, in turn, loaned the funds to Arctic Cat Production Support LLC, our direct, wholly-owned subsidiary at an interest rate of 3.106%. The proceeds of the loans from the CDEs (including loans representing the capital contribution made by the investors, net of syndication fees) will be used to fund the equipment investments.

In exchange for its $5.3 million contribution to the Investment Fund, Wells Fargo is entitled to substantially all of the tax benefits derived from the NMTC transaction, while we effectively received net proceeds equal to Wells Fargo’s contributions to the Investment Fund less direct and incremental transaction costs. This transaction includes a put/call provision whereby we may be obligated or entitled to repurchase Wells Fargo’s interest in the Investment Fund. We believe that the investor will exercise the put option in February 2023 at the end of the recapture period. If the investor does not exercise the put option, we have a call option to purchase the Investment Fund at fair value. The value attributed to the put/call is de minimis. The NMTC is subject to 100% recapture for a period of seven years as provided in the Internal Revenue Code. We are required to be in compliance with various regulations and contractual provisions that apply to the NMTC arrangement. Non-compliance with applicable requirements could result in projected tax benefits not being realized and, therefore, could require us to indemnify Wells Fargo for any loss or recapture of NMTC’s until such time as our obligation to deliver tax benefits is relieved. We do not anticipate any tax credit recaptures will be required in connection with this arrangement.

We have determined that the Investment Fund is a VIE, of which we are the primary beneficiary and, as such, we have consolidated the Investment Fund. The ongoing activities of the Investment Fund—collecting and remitting interest and fees and NMTC compliance—were all considered in the initial design and are not expected to significantly affect economic performance throughout the life of the Investment Fund. We also considered the contractual arrangements that obligate us to deliver tax benefits and provide various other guarantees to the structure; Wells Fargo’s lack of a material interest in the underlying economics of the project; and the fact that we are obligated to absorb losses of the Investment Fund in determining we are the primary beneficiary.

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Based on the contractual arrangements that obligate us to deliver tax benefits to Wells Fargo, we have included Wells Fargo’s contribution within other liabilities in our Consolidated Balance Sheets. The benefit of this net $5.3 million contribution will be recognized as earnings at the end of the seven year recapture period, when our performance obligation is relieved. Direct and incremental costs incurred in structuring the financing arrangement of $0.9 million have been deferred within other assets in the Consolidated Balance Sheets and will be recognized in proportion to the recognition of the related profits. Incremental costs to maintain the structure during the compliance period will be recognized as incurred.

13. QUARTERLY FINANCIAL DATA (Unaudited)

($ in thousands, except per share amounts)	Total Year			First Quarter			Second Quarter		Third Quarter			Fourth Quarter
Net Sales
2016	$	632,895		$	134,381		$	211,157	$	166,000		$	121,357
2015		698,756			143,639			262,479		193,735			98,903
2014		730,491			120,768			238,525		225,790			145,408
Gross Profit (Loss)
2016	$	90,667		$	22,562		$	43,918	$	24,250		$	(63	)
2015		119,449			30,801			55,081		34,913			(1,346	)
2014		151,079			29,160			61,674		40,213			20,032
Net Earnings (Loss)
2016	$	(9,187	)	$	(1,056	)	$	11,171	$	(2,397	)	$	(16,905	)
2015		4,920			3,569			15,389		7,487			(21,525	)
2014		39,404			5,468			23,365		12,120			(1,549	)
Net Earnings (Loss) Per Share
2016 Basic	$	(0.71	)	$	(0.08	)	$	0.86	$	(0.18	)	$	(1.30	)
Diluted		(0.71	)		(0.08	)		0.85		(0.18	)		(1.30	)
2015 Basic		0.38			0.28			1.19		0.58			(1.66	)
Diluted		0.38			0.27			1.18		0.57			(1.66	)
2014 Basic		2.97			0.41			1.75		0.90			(0.12	)
Diluted		2.90			0.40			1.70		0.89			(0.12	)

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated, as of the end of the period covered by this report, the effectiveness of our disclosure controls and procedures as defined in Exchange Act Rule 13a-15(e). In designing and evaluating our disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply judgment in evaluating the cost-benefit relationship of possible internal controls.

Based upon the evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this Annual Report on Form 10-K, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports that we file or submit under the Securities Exchange Act of 1934, as amended, is (1) recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (2) accumulated and communicated to our management including our Chief Executive Officer and Chief Financial Officer, in a manner that allows timely decisions regarding required disclosure. No changes have occurred during the period covered by this report or since the evaluation date that would have a material effect on the disclosure controls and procedures. Our internal control report is included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K under the caption “Management’s Report on Internal Control over Financial Reporting.” The report of Grant Thornton LLP, our independent registered public accounting firm, regarding the effectiveness of our internal control over financial reporting is included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K under the caption “Report of Independent Registered Public Accounting Firm.”

Changes in Internal Control over Financial Reporting

There have been no changes in our internal controls over financial reporting during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

ITEM 9B. OTHER INFORMATION

On March 10, 2016, we entered into a Consent and Fourth Amendment to the Amended and Restated Loan and Security Agreement (the “Fourth Amendment”), amending our senior secured revolving credit facility with certain financial institutions as lenders and Bank of America, N.A., as lender and agent for the lenders (the “Credit Facility”). The Fourth Amendment increases the amount we are permitted to borrow under our Credit Facility from an aggregate principal amount of $100.0 million to $130.0 million during May through November and from $50.0 million to $75.0 million during all other months of the fiscal year. The Fourth Amendment also extended the maturity date of the Credit Facility from November 10, 2017 to March 10, 2021. The Credit Facility continues to contain a letter of credit feature permitting us to request that Bank of America, N.A. support obligations incurred by Arctic Cat in the ordinary course of business. We intend to use amounts borrowed under our Credit Facility for letters of credit, ongoing working capital needs and general corporate purposes.

The Credit Facility continues to provide that borrowings will bear interest at either the base rate plus the applicable margin or the LIBOR rate plus the applicable margin, depending on the type of loan. The Fourth Amendment revises the calculation for the applicable margin to depend on Arctic Cat’s leverage ratio and

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amount available for borrowing under the Credit Facility, rather than the fixed charge coverage ratio. Arctic Cat’s leverage ratio is its ratio of debt to EBITDA, calculated quarterly. The applicable margin ranges from 0.0% to 0.5% for base rate loans and from 1.0% to 1.5% for LIBOR loans.

The Fourth Amendment eliminates some of the restrictions on our ability to declare or pay dividends, but continues to restrict dividends when outstanding borrowings exceed certain thresholds. Under the Fourth Amendment, we are prohibited from declaring or paying dividends when less than $26,000,000 or 20% (previously $25,000,000 or 25%) of the aggregate amount we are permitted to borrow under the Credit Facility remains undrawn.

The provisions of the Amended and Restated Loan and Security Agreement related to the security interest, covenants, and events of default were not materially amended by the Fourth Amendment, except as otherwise discussed.

The foregoing description of the Fourth Amendment is a summary and is qualified in its entirety by reference to the Fourth Amendment attached hereto as Exhibit 10.39, which is incorporated herein by reference.

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information included under the headings “Election of Directors,” “Corporate Governance,” “Audit Committee Report” and “Section 16(a) Beneficial Ownership Reporting Compliance” in our definitive Proxy Statement for the Annual Meeting of Shareholders to be held July 25, 2016, is incorporated herein by reference.

Information regarding our executive officers is furnished in a separate item captioned “Executive Officers of the Registrant” included in Part I of this Annual Report on Form 10-K.

ITEM 11. EXECUTIVE COMPENSATION

The information included under the headings “Compensation Discussion and Analysis,” “Corporate Governance—Compensation and Human Resources Committee Interlocks and Insider Participation” and “Executive Compensation and Other Information” in our definitive Proxy Statement for the Annual Meeting of Shareholders to be held July 25, 2016, is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information included under the headings “Beneficial Ownership of Capital Stock” and “Equity Compensation Plan Information” in our definitive Proxy Statement for the Annual Meeting of Shareholders to be held July 25, 2016, is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information included under the headings “Corporate Governance—Policies and Procedures Regarding Related Person Transactions” and “Corporate Governance—Director Independence” in our definitive Proxy Statement for the Annual Meeting of Shareholders to be held on July 25, 2016, is incorporated herein by reference.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The information included under the heading “Ratification of Appointment of Independent Registered Public Accounting Firm—Audit and Non-Audit Fees” in our definitive Proxy Statement for the Annual Meeting of Shareholders to be held on July 25, 2016 is incorporated herein by reference.

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PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) Documents filed as part of report

1. Financial Statements.

The Consolidated Financial Statements and Notes thereto are included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

2. Schedules filed as part of this Annual Report on Form 10-K.

The information required to be disclosed within Schedule II—Valuation and Qualifying Accounts is provided within the Consolidated Financial Statements and Notes thereto are included in Item 8, Financial Statements and Supplementary Data, of this Annual Report on Form 10-K.

3. Exhibits

EXHIBIT INDEX

Exhibit Number
3.1	Amended and Restated Articles of Incorporation of Arctic Cat—incorporated by reference to Exhibit 3(a) to the Registrant’s Annual Report on Form 10-K for the fiscal year ended March 31, 1997 filed with the SEC on June 30, 1997.
3.2	Articles of Amendment of Restated Articles of Incorporation of Arctic Cat Inc.—incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 11, 2014.
3.3	Amended and Restated By-Laws of Arctic Cat—incorporated by reference to Exhibit 3.1to the Registrant’s Current Report on Form 8-K filed with the SEC on January 16, 2013.
3.4	Amendment to Amended and Restated Bylaws of Arctic Cat Inc. – incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 11, 2014.
4.1	Form of specimen common stock certificate—incorporated by reference to the Registrant’s Registration Statement on Form S-1 (File Number 33-34984) filed with the SEC on May 21, 1990.
10.1*	Form of Employment Agreement between Arctic Cat and Tracy J. Crocker, Bradley D. Darling, Paul A. Fisher and William J. Nee—incorporated by reference to Exhibit 10.2 to the Registrant’s Annual Report on Form 10-K filed with the SEC on May 30, 2015.
10.2*	2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC August 14, 2007.
10.3*	First Amendment to 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 the Registrant’s Current Report on Form 8-K filed with the SEC August 12, 2009.
10.4*	Second Amendment to 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 the Registrant’s Current Report on Form 8-K filed with the SEC April 5, 2011.
10.5*	Form of Restricted Stock Unit Agreement for Non-Employee Directors for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.3 the Registrant’s Current Report on Form 8-K filed with the SEC April 5, 2011.

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Exhibit Number
10.6*	Form of Restricted Stock Unit Agreement for Executive Officers for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.4 the Registrant’s Current Report on Form 8-K filed with the SEC April 5, 2011.
10.7*	Form of Incentive Stock Option Agreement for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC August 14, 2007.
10.8*	Form of Non-Qualified Stock Option Agreement for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the SEC August 14, 2007.
10.9*	Amended Form of Director Non-Qualified Stock Option Agreement for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.2 the Registrant’s Current Report on Form 8-K filed with the SEC April 5, 2011.
10.10*	Form of Restricted Stock Agreement for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008.
10.11*	Form of Stock-Settled Appreciation Rights Agreement for 2007 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on April 7, 2008.
10.12*	The Arctic Cat Inc. 2013 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on August 12, 2013.
10.13*	Form of Director Non-Qualified Stock Option Agreement—incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2013.
10.14*	Form of Executive Officer Non-Qualified Stock Option Agreement—incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2013.
10.15*	Form of Executive Officer Incentive Stock Option Agreement—incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2013.
10.16*	Form of Restricted Stock Unit Agreement for Non-Employee Directors—incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2013.
10.17*	Form of Restricted Stock Unit Agreement for Executive Officers—incorporated by reference to Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2013.
10.18*	Form of Stock-Settled Appreciation Rights Agreement—incorporated by reference to Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2013.
10.19	Vendor Agreement dated October 14, 2009, between Arctic Cat, Arctic Cat Sales Inc. and GE Commercial Distribution Finance Corporation—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 20, 2009.
10.20	Amendment No. 1 dated October 20, 2009 to Vendor Agreement between Arctic Cat, Arctic Cat Sales, Inc., and GE Commercial Distribution Finance Corporation dated October 14, 2009—incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 20, 2009.

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Exhibit Number
10.21	Amended and Restated Loan and Security Agreement, dated as of November 8, 2013, among Arctic Cat, certain financial institutions as lenders and Bank of America, N.A. as lender and administrative agent for the lenders—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 15, 2013.
10.22*	Amended and Restated Employment Agreement dated October 27, 2010 between Arctic Cat and Claude J. Jordan—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on October 28, 2010.
10.23	Amendment No. 3 dated September 30, 2010 to Vendor Agreement between Arctic Cat, Arctic Cat Sales, Inc., and GE Commercial Distribution Finance Corporation dated October 14, 2009—incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on November 8, 2010.
10.24*	Form of Arctic Cat Inc. Change in Control Agreement for Executive Officers – incorporated by reference to Exhibit 10.24 to the Registrant’s Annual Report on Form 10-K filed with the SEC on May 29, 2015.
10.25*	Limited Term Employment Agreement, dated June 2, 2014, between Arctic Cat and Christopher A. Twomey—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 5, 2014.
10.26*	Amendment to Employment Agreement, dated June 2, 2014, between Arctic Cat and Timothy C. Delmore—incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 5, 2014.
10.27*	Employment Agreement, dated November 10, 2014, between Arctic Cat and Christopher T. Metz—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 14, 2014.
10.28*	Change in Control Agreement, dated November 10, 2014, between Arctic Cat and Christopher T. Metz—incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on November 14, 2014.
10.29*	Inducement Non-Qualified Stock Option Agreement between the Registrant and Christopher T. Metz—incorporated by reference to Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on February 6, 2015.
10.30*	Inducement Restricted Stock Unit Agreement between the Registrant and Christopher T. Metz—incorporated by reference to Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on February 6, 2015.
10.31*	Form of Indemnification Agreement—incorporated by reference to Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on February 6, 2015.
10.32*	Employment Agreement, dated February 3, 2015, between Arctic Cat and Christopher J. Eperjesy—incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on February 9, 2015.
10.33*	Change in Control Agreement, dated February 3, 2015, between Arctic Cat and Christopher J. Eperjesy—incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on February 9, 2015.
10.34*	Amendment No. 1 to Arctic Cat Inc. 2013 Omnibus Stock and Incentive Plan—incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on February 5, 2016.

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Exhibit Number
10.35	Amendment No. 5 to Vendor Agreement, dated December 15, 2015, by and among GE Commercial Distribution Finance LLC, Arctic Cat Sales Inc. and Arctic Cat Inc. – incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on February 5, 2016.
10.36+	First Amendment to the Amended and Restated Loan and Security Agreement, dated June 12, 2014, among Arctic Cat, the subsidiaries of Arctic Cat Inc., certain financial institutions as lenders, and Bank of America, N.A., as lender and administrative agent for the lenders.
10.37+	Joinder, Consent, Waiver and Second Amendent to the Amended and Restated Loan and Security Agreement, dated May 12, 2015, among Arctic Cat, the subsidiaries of Arctic Cat Inc., MotorFist, LLC, certain financial institutions as lenders, and Bank of America, N.A., as lender and administrative agent for the lenders.
10.38+	Consent and Third Amendment to the Amended and Restated Loan and Security Agreement, dated February 11, 2016, among Arctic Cat, the subsidiaries of Arctic Cat Inc., certain financial institutions as lenders, and Bank of America, N.A., as lender and administrative agent for the lenders.
10.39+	Consent and Fourth Amendment to the Amended and Restated Loan and Security Agreement, dated March 10, 2016, among Arctic Cat, the subsidiaries of Arctic Cat Inc., certain financial institutions as lenders, and Bank of America, N.A., as lender and administrative agent for the lenders.
10.40*+	Cash-Settled Appreciation Rights Agreement, dated February 5, 2016, between Arctic Cat Inc. and Christopher T. Metz.
10.41*+	Employment Agreement, dated April 4, 2015, between Arctic Cat Inc. and Greg Williamson.
10.42*+	Employment Agreement, dated February 25, 2016, between Arctic Cat Inc. and Patricia L. Jones.
21.1+	Subsidiaries of the Registrant
23.1+	Consent of Independent Registered Public Accounting Firm
24.1+	Power of Attorney (see signature page)
31.1+	Section 302 Certification of Chief Executive Officer
31.2+	Section 302 Certification of Chief Financial Officer
32.1+	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2+	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101+	Financial statements from the annual report on Form 10-K of Arctic Cat for the year ended March 31, 2016, formatted in XBRL: (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income (Loss), (iv) the Consolidated Statements of Shareholders’ Equity, (v) the Consolidated Statements of Cash Flows, and (vi) the Notes to the Consolidated Financial Statements.

* Management compensatory plan or arrangement

+ Filed with this Annual Report on Form 10-K

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SIGNATURES

Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	ARCTIC CAT INC.
Date: May 27, 2016	/s/ CHRISTOPHER T. METZ Christopher T. Metz President, Chief Executive Officer and Director

POWER OF ATTORNEY

Each person whose signature appears below constitutes Christopher T. Metz and Kenneth D. Roering as his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any or all amendments to this Annual Report on Form 10-K and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all said attorney-in-fact and agent, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

Signature	Title	Date
/s/ CHRISTOPHER T. METZ	President, Chief Executive Officer and Director	May 27, 2016
Christopher T. Metz	(principal executive officer)
/s/ CHRISTOPHER J. EPERJESY	Chief Financial Officer	May 27, 2016
Christopher J. Eperjesy	(principal financial and accounting officer)
/s/ KIM A. BRINK	Director	May 27, 2016
Kim A. Brink
/s/ TONY J. CHRISTIANSON	Director	May 27, 2016
Tony J. Christianson
/s/ ANDREW S. DUFF	Director	May 27, 2016
Andrew S. Duff
/s/ SUSAN E. LESTER	Director	May 27, 2016
Susan E. Lester
/s/ JOSEPH F. PUISHYS	Director	May 27, 2016
Joseph F. Puishys
/s/ KENNETH J. ROERING	Director	May 27, 2016
Kenneth J. Roering

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EX-10.36

Exhibit 10.36

FIRST AMENDMENT TO THE AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

This FIRST AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”) is dated as of June 12, 2014, and is entered into by and among ARCTIC CAT INC., a Minnesota corporation (“Arctic Cat”), and the Subsidiaries of Arctic Cat identified on the signature pages hereto, as borrowers (collectively, the “Borrowers”), the financial institutions party to this Amendment from time to time as lenders (collectively, “Lenders”), and BANK OF AMERICA, N.A., a national banking association, as agent for the Lenders (“Agent”).

WHEREAS, the Borrowers, the Agent, and the Lenders have entered into that certain Amended and Restated Loan and Security Agreement (as amended, restated, or otherwise modified from time to time, the “Loan Agreement”), dated as of November 8, 2013; and

WHEREAS, the Borrowers have requested that the Agent and the Lenders agree to enter into certain amendments to the Loan Agreement,

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in the Loan Agreement and this Amendment, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

Initially capitalized terms used but not otherwise defined in this Amendment have the respective meanings set forth in the Loan Agreement, as amended hereby.

ARTICLE II

AMENDMENTS TO LOAN AGREEMENT

2.01. Amended Definitions. The following definitions from Section 1.1 of the Loan Agreement are hereby amended in their entirety to read as follows:

Applicable Margin:

(a) On or before June 30, 2014, the margin set forth below, as determined by the Fixed Charge Coverage Ratio as of the last day of the immediately preceding Fiscal Quarter measured on a trailing twelve-month basis:

Level	Fixed Charge Coverage Ratio	Base Rate Loans			LIBOR Loans
I	> 2.50:1.00		0.25	%		1.25	%
II	> 1.50:1.00 and < 2.50:1.00		0.50	%		1.50	%
III	< 1.50 to 1.00		0.75	%		1.75	%

Margins shall be subject to increase or decrease by Agent on the first day of the calendar month following each Fiscal Quarter end. If, by the first day of a month, any financial statement or Compliance Certificate due in the preceding month has not been received, then, at the option of Agent or Required Lenders, margins shall be determined as if Level III were applicable until the first day of the calendar month following actual receipt.

(b) On or after July 1, 2014, the margin set forth below, as determined by the average daily Availability for the last Fiscal Quarter:

Level	Average Daily Availability	Base Rate Loans			LIBOR Loans
I	> 60% of the aggregate amount of the Revolver Commitments then in effect		0.25	%		1.25	%
II	> 30% and < 60% of the aggregate amount of the Revolver Commitments then in effect		0.50	%		1.50	%
III	< 30% of the aggregate amount of the Revolver Commitments then in effect		0.75	%		1.75	%

Margins shall be subject to increase or decrease by Agent on the first day of the calendar month following each Fiscal Quarter end. If, by the first day of a month, any financial statement or Borrowing Base Certificate due in the preceding month has not been received, then, at the option of Agent or Required Lenders, margins shall be determined as if Level III were applicable until the first day of the calendar month following actual receipt.

Fixed Charge Coverage Ratio: the ratio, determined on a consolidated basis for Borrowers and Subsidiaries for any period, of (a) EBITDA minus Capital Expenditures (except those financed with Borrowed Money other than Revolver Loans), cash taxes paid, and stock repurchases (except, beginning on May 1, 2014, and only for purposes of calculating the Applicable Margin, stock repurchases will not be subtracted from EBITDA) and Distributions made in cash to (b) Fixed Charges.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Obligor hereby represents and warrants to each Lender and the Agent, as of the First Amendment Effective Date (as such term is defined in Section 4.01 below), as follows:

3.01. Representations and Warranties. After giving effect to this Amendment, the representations and warranties set forth in Section 9 of the Loan Agreement and in each other Loan Document are true and correct in all material respects on and as of the date hereof and on and as of the First Amendment Effective Date with the same effect as if made on and as of the date hereof or the First Amendment Effective Date,

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as the case may be, except to the extent such representations and warranties expressly relate solely to an earlier date.

3.02. No Defaults. Each of the Obligors is in compliance with all terms and conditions of the Loan Agreement and the other Loan Documents on its part to be observed and performed and no Default or Event of Default has occurred and is continuing.

3.03. Authority and Pending Actions. The execution, delivery, and performance by each Obligor of this Amendment has been duly authorized by each such Obligor (as applicable) and there is no action pending or any judgment, order, or decree in effect which is likely to restrain, prevent, or impose materially adverse conditions upon the performance by any Obligor of its obligations under the Loan Agreement or the other Loan Documents.

3.04. Enforceability. This Amendment constitutes the legal, valid, and binding obligation of each Obligor, enforceable against each such Obligor in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization, or other similar laws affecting the enforcement of creditors’ rights or by the effect of general equitable principles.

3.05. Breach; Conflicts. The execution, delivery, and performance by each Obligor of this Amendment do not and will not conflict with, or constitute a violation or breach of, or result in the imposition of any Lien upon the property of such Obligor, by reason of the terms of (i) any contract, mortgage, lease, agreement, indenture, or instrument to which such Obligor is a party or which is binding upon it, (ii) any Applicable Law with respect to such Obligor, or (iii) the certificate or articles of incorporation or by-laws or the limited liability company or limited partnership agreement of such Obligor.

ARTICLE IV

CONDITIONS PRECEDENT AND FURTHER ACTIONS

4.01. Conditions Precedent. The amendments contained in Article II shall not be binding upon the Agent or the Lenders until each of the following conditions precedent have been satisfied in form and substance satisfactory to the Agent (the first date upon which each such condition has been satisfied being herein called the “First Amendment Effective Date”):

(a) The representations and warranties contained herein and in the Loan Agreement, as amended hereby, shall be true and correct in all material respects as of the date hereof, as if made on such date, except for such representations and warranties limited by their terms to a specific date;

(b) Each Obligor shall have delivered to the Agent duly executed counterparts of this Amendment which, when taken together, bear the authorized signatures of the Borrowers, the Agent, and the Lenders;

(c) The Obligors shall have paid to the Agent all fees, costs, and expenses owed to and/or incurred by the Agent and the Lenders in connection with this Amendment;

(d) The Agent shall have received such other documents, legal opinions, instruments, and certificates relating to this Amendment as it shall reasonably request and such other documents, legal opinions, instruments, and certificates that shall be satisfactory in form and substance to the Agent and the Lenders. All corporate proceedings taken or to be taken in connection with this Amendment and documents incidental thereto whether or not referred to herein shall be reasonably satisfactory in form and substance to the Agent and the Lenders; and

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(e) All proceedings taken in connection with the transactions contemplated by this Amendment and all documentation and other legal matters incident thereto shall be satisfactory to the Agent in its sole and absolute discretion.

4.02. Further Actions. Each of the parties to this Amendment agrees that at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Amendment.

ARTICLE V

COSTS AND EXPENSES

Without limiting the terms and conditions of the Loan Documents, the Obligors jointly and severally agree to pay on demand: (i) all reasonable costs and expenses incurred by the Agent in connection with the preparation, negotiation, and execution of this Amendment and the other Loan Documents executed pursuant to this Amendment and any and all subsequent amendments, modifications, and supplements to this Amendment, including without limitation, the reasonable costs and fees of the Agent’s legal counsel; and (ii) all reasonable costs and expenses reasonably incurred by the Agent in connection with the enforcement or preservation of any rights under the Loan Agreement, this Amendment, and/or the other Loan Documents, including without limitation, the reasonable costs and fees of the Agent’s legal counsel.

ARTICLE VI

MISCELLANEOUS

6.01. Cross-References. References in this Amendment to any Section are, unless otherwise specified, to such Section of this Amendment.

6.02. Instrument Pursuant to Loan Agreement. This Amendment is a Loan Document executed pursuant to the Loan Agreement and shall (unless otherwise expressly indicated herein) be construed, administered, and applied in accordance with the terms and provisions of the Loan Agreement.

6.03. Acknowledgment of the Obligors. Each Obligor hereby represents and warrants that the execution and delivery of this Amendment and compliance by such Obligor with all of the provisions of this Amendment: (i) are within the powers and purposes of such Obligor; (ii) have been duly authorized or approved by the board of directors (or other appropriate governing body) of such Obligor; and (iii) when executed and delivered by or on behalf of such Obligor will constitute valid and binding obligations of such Obligor, enforceable in accordance with its terms. Each Obligor reaffirms its obligations to perform and pay all amounts due to the Agent or the Lenders under the Loan Documents (including, without limitation, its obligations under any promissory note evidencing any of the Loans) in accordance with the terms thereof, as amended and modified hereby.

6.04. Loan Documents Unmodified. Each of the amendments provided herein shall apply and be effective only with respect to the provisions of the Loan Document specifically referred to by such amendments. Except as otherwise specifically modified by this Amendment, all terms and provisions of the Loan Agreement and all other Loan Documents, as modified hereby, shall remain in full force and effect and are hereby ratified and confirmed in all respects. Nothing contained in this Amendment shall in any way impair the validity or enforceability of the Loan Documents, as modified hereby, or alter, waive, annul, vary, affect, or impair any provisions, conditions, or covenants contained therein or any rights,

4

powers, or remedies granted therein, except as otherwise specifically provided in this Amendment. Subject to the terms of this Amendment, any lien and/or security interest granted to the Agent, for the benefit of the Lenders, in the Collateral set forth in the Loan Documents shall remain unchanged and in full force and effect and the Loan Agreement and the other Loan Documents shall continue to secure the payment and performance of all of the Obligations.

6.05. Parties, Successors and Assigns. This Amendment represents the agreement of the Borrowers, the Agent and each of the Lenders signatory hereto with respect to the subject matter hereof, and there are no promises, undertakings, representations, or warranties relative to the subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents. This Amendment shall be binding upon and inure to the benefit of Borrowers, Agent, Lenders, and their respective successors and assigns, except that (i) no Borrower shall have the right to assign its rights or delegate its obligations under any Loan Documents; and (ii) any assignment by a Lender must be made in compliance with Section 13.3 of the Loan Agreement.

6.06. Counterparts. This Amendment may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment shall become effective when all conditions precedent have been met and when the Agent has executed it and received counterparts bearing the signatures of all other parties hereto. Delivery of a signature page of this Amendment by telecopy shall be effective as delivery of a manually executed counterpart of such agreement. This Amendment may be executed and delivered by facsimile or electronic mail, and will have the same force and effect as manually signed originals. Any electronic signature, contract formation on an electronic platform and electronic record-keeping shall have the same legal validity and enforceability as a manually executed signature or use of a paper-based recordkeeping system to the fullest extent permitted by Applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any similar state law based on the Uniform Electronic Transactions Act.

6.07. Headings. The headings, captions, and arrangements used in this Amendment are for convenience only, are not a part of this Amendment, and shall not affect the interpretation hereof.

6.08. Waivers. To the fullest extent permitted by Applicable Law, each Borrower waives (a) the right to trial by jury (which the Agent and each Lender hereby also waives) in any proceeding or dispute of any kind relating in any way to any Loan Documents (including this Amendment), Obligations, or Collateral; (b) presentment, demand, protest, notice of presentment, default, non-payment, maturity, release, compromise, settlement, extension or renewal of any commercial paper, accounts, documents, instruments, chattel paper, and guaranties at any time held by the Agent on which a Borrower may in any way be liable, and hereby ratifies anything the Agent may do in this regard; (c) notice prior to taking possession or control of any Collateral; (d) any bond or security that might be required by a court prior to allowing the Agent to exercise any rights or remedies; (e) the benefit of all valuation, appraisement and exemption laws; (f) any claim against the Agent, Issuing Bank or any Lender, on any theory of liability, for special, indirect, consequential, exemplary, or punitive damages (as opposed to direct or actual damages) in any way relating to any Enforcement Action, Obligations, Loan Documents or transactions relating thereto; and (g) notice of acceptance hereof. Each Borrower acknowledges that the foregoing waivers are a material inducement to the Agent, Issuing Bank and Lenders entering into this Amendment and that the Agent, Issuing Bank and Lenders are relying upon the foregoing in their dealings with the Borrowers. Each Borrower has reviewed the foregoing waivers with its legal counsel and has knowingly and voluntarily waived its jury trial and other rights following consultation with legal counsel. In the event of litigation, this Amendment may be filed as a written consent to a trial by the court.

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6.09. Choice of Law; Jury Trial Waiver; Submission to Jurisdiction. THIS AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS, WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS). EACH BORROWER HEREBY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL OR STATE COURT SITTING IN OR WITH JURISDICTION OVER THE STATE OF ILLINOIS, IN ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING RELATING IN ANY WAY TO ANY LOAN DOCUMENTS, AND AGREES THAT ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING SHALL BE BROUGHT BY IT SOLELY IN ANY SUCH COURT. EACH BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL CLAIMS, OBJECTIONS AND DEFENSES THAT IT MAY HAVE REGARDING ANY SUCH COURT’S PERSONAL OR SUBJECT MATTER JURISDICTION, VENUE OR INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 14.3.1 OF THE LOAN AGREEMENT. A final judgment in any proceeding of any such court shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or any other manner provided by Applicable Law. Nothing herein shall limit the right of the Agent or any Lender to bring proceedings against any Obligor in any other court, nor limit the right of any party to serve process in any other manner permitted by Applicable Law. Nothing in this Amendment shall be deemed to preclude enforcement by the Agent of any judgment or order obtained in any forum or jurisdiction.

6.10. Severability. Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be valid under Applicable Law. If any provision is found to be invalid under Applicable Law, it shall be ineffective only to the extent of such invalidity and the remaining provisions of the Loan Documents shall remain in full force and effect.

6.11. Total Agreement. This Amendment, the Loan Agreement, and all other Loan Documents constitute the entire agreement, and supersede all prior understandings and agreements, among the parties relating to the subject matter hereof.

6.12. Release. IN CONSIDERATION OF THIS AMENDMENT, EACH OBLIGOR REPRESENTS AND WARRANTS THAT AS OF THE DATE HEREOF THERE ARE NO KNOWN CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS, AND HEREBY WAIVES ANY AND ALL CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF ITS EXECUTION OF THIS AMENDMENT AND RELEASES AND DISCHARGES AGENT, EACH LENDER AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SHAREHOLDERS, AFFILIATES AND ATTORNEYS (COLLECTIVELY THE “RELEASED PARTIES”) FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH SUCH OBLIGOR HAS OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment as of the day and year first written above.

BORROWERS:
ARCTIC CAT INC., a Minnesota corporation
By:	/s/ Timothy C. Delmore
Name: Timothy C. Delmore
Title: Chief Financial Officer
ARCTIC CAT SALES INC., a Minnesota corporation
By:	/s/ Timothy C. Delmore
Name: Timothy C. Delmore
Title: Chief Financial Officer
ARCTIC CAT PRODUCTION LLC, a Minnesota limited liability company
By:	/s/ Timothy C. Delmore
Name: Timothy C. Delmore
Title: Chief Financial Officer
ARCTIC CAT PRODUCTION SUPPORT LLC, a Minnesota limited liability company
By:	/s/ Timothy C. Delmore
Name: Timothy C. Delmore
Title: Chief Financial Officer
ARCTIC CAT SHARED SERVICES LLC, a Minnesota limited liability company
By:	/s/ Timothy C. Delmore
Name: Timothy C. Delmore
Title: Chief Financial Officer

Notice Address:
505 Waterford Park, Suite 1000
505 N. Highway 169
Plymouth, MN 55441
Attn:	Timothy C. Delmore, CFO
Telecopy:	763.354.1803

BANK OF AMERICA, N.A.,
as Agent and Lender
By:	/s/ Brian Conole

Name:	Brian Conole
Title:	Senior Vice President
Address:	Bank of America Business Capital
	20975 Swenson Drive, Suite 200
	Waukesha, WI 53186
Telecopy:	262.207.3347

JPMORGAN CHASE BANK, N.A.,
as Lender
By:	/s/ Pamela Esker

Name:	Pamela Esker
Title:	Authorized Officer

EX-10.37

Exhibit 10.37

JOINDER, CONSENT, WAIVER, AND SECOND AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

This JOINDER, CONSENT, WAIVER, AND SECOND AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”) is dated as of May 12, 2015, and is entered into by and among ARCTIC CAT INC., a Minnesota corporation (“Arctic Cat”), and the Subsidiaries of Arctic Cat identified on the signature pages hereto, as borrowers (collectively, the “Original Borrowers”), MOTORFIST, LLC, a Minnesota limited liability company (“MotorFist” and, together with the Original Borrowers, the “Borrowers” and each a “Borrower”), the financial institutions party to this Amendment from time to time as lenders (collectively, “Lenders”), and BANK OF AMERICA, N.A., a national banking association, as agent for the Lenders (“Agent”).

WHEREAS, the Original Borrowers, the Agent, and the Lenders have entered into that certain Amended and Restated Loan and Security Agreement dated as of November 8, 2013 (as amended, restated, or otherwise modified from time to time, the “Loan Agreement”), and certain of the Original Borrowers and the Agent have entered into that certain Pledge Agreement dated as of November 10, 2009 (as amended, restated, or otherwise modified from time to time, the “Pledge Agreement”);

WHEREAS, on February 18, 2015, MotorFist, LLC, a Minnesota limited liability company (“MotorFist”), was formed as a wholly-owned Subsidiary of Arctic Cat Sales Inc., a Minnesota corporation;

WHEREAS, the Borrowers have requested that the Agent and the Lenders agree (a) to consent to (i) the formation of MotorFist and (ii) the purchase of certain of the assets of MotorFist, LLC, an Idaho limited liability company (“Seller”), pursuant to that certain Asset Purchase Agreement dated as of February 25, 2015 (the “MotorFist Asset Purchase Agreement”) by and among the Seller, MotorFist, Brad A. Ball, and Arctic Cat Sales Inc., a Minnesota corporation (that transaction, the “MotorFist Acquisition”), (b) to waive the Existing Defaults, as defined below, and (c) to make certain amendments to the Loan Agreement in connection with the MotorFist Acquisition; and

WHEREAS, MotorFist is willing to join the Loan Agreement as a Borrower pursuant to Section 10.1.9 of the Loan Agreement and has requested and the Agent has agreed to join MotorFist as a Borrower to the Loan Agreement;

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in the Loan Agreement and this Amendment, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

Initially capitalized terms used but not otherwise defined in this Amendment have the respective meanings set forth in the Loan Agreement, as amended hereby.

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ARTICLE II

CONSENT, WAIVER, AND AMENDMENTS TO LOAN AGREEMENT

2.01 Limited Consent.

(a) The Borrowers have advised Agent and Lenders that MotorFist was formed as a wholly-owned Subsidiary of Arctic Cat Sales Inc., a Minnesota corporation, and the Borrowers have consummated the MotorFist Acquisition pursuant to the terms and conditions of the MotorFist Asset Purchase Agreement. The Borrowers hereby acknowledge that, absent the consent set forth in this Section 2.01, an Event of Default would occur under Section 11.1(c) of the Loan Agreement as a result of the MotorFist Acquisition, because (i) the MotorFist Acquisition is not permitted pursuant to Section 10.2.4 of the Loan Agreement, as the Borrowers’ Fixed Charge Coverage Ratio (calculated on a trailing twelve-month basis) was not at least 1.10:1.00 prior to and immediately after giving effect to the MotorFist Acquisition (the “FCCR Requirement”), and (ii) as a result of the failure to comply with the FCCR Requirement, the formation of MotorFist is not permitted pursuant to Section 10.2.9 of the Loan Agreement. The Borrowers hereby request that Agent and the Lenders consent to the formation of MotorFist and the MotorFist Acquisition.

(b) Subject to the terms, conditions, and other restrictions set forth in this Amendment, each of the Agent and the Lenders hereby consents to the formation of MotorFist and the MotorFist Acquisition in accordance with the MotorFist Asset Purchase Agreement, so long as the MotorFist Acquisition would have been, if the FCCR Requirement were met, permitted pursuant to the Loan Agreement.

(c) The consent set forth in this Section 2.01 does not affect the continued legality, validity, and binding effect of the Loan Agreement or the other Loan Documents. The Loan Agreement and the other Loan Documents continue to be fully enforceable in each case, except as expressly provided in this Amendment. The consents set forth in this Section 2.01 are specifically limited in time and scope to the formation of MotorFist and the MotorFist Acquisition as described in this Amendment and do not extend or apply to any other event, occurrence or circumstances in existence as of the date of this Amendment or arising after the date of this Amendment. In addition, the consent set forth in this Section 2.01 does not constitute or establish (and is not to be deemed to constitute or establish) a custom or a practice on the part of Agent or any Lender and does not prejudice any right of Agent or any Lender in respect of any other proposed Subsidiary formation or Restricted Investment.

2.02 Limited Waiver.

(a) The Borrowers have advised Agent and Lenders that Arctic Cat (i) has abandoned the Patent Collateral (as defined in that certain Patent Security Agreement dated as of November 10, 2009, by and between Arctic Cat and Agent, as amended, restated, supplemented or otherwise modified, the “Patent Agreement”) described in Section 2(c)(ii) of that certain Fourth Amendment to Patent Security Agreement dated as of even date herewith, by and among Arctic Cat, Agent, and Required Lenders (the “Patent Amendment”), without obtaining the prior written consent of the Agent; (ii) has obtained rights to the Patent Collateral described in Section 2(c)(i) of the Patent Amendment without giving Agent prompt written notice thereof; and (iii) has abandoned its Tigershark trademarks having the registration numbers of 1742252 and 1851415 without obtaining the prior written consent of the Agent (collectively, the “Noncompliance”). Borrowers acknowledge that, as a result of the above-mentioned actions and failures to act, Events of Default exist under Section 11.1(c) of the Loan Agreement (collectively, the “Existing Defaults”).

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(b) The Agent and the Lenders hereby waive the Noncompliance and the Existing Defaults (such waivers, collectively, the “Waiver”). Such Waiver is conditioned upon the terms and conditions set forth herein, shall be limited precisely as described herein and shall relate solely to the Noncompliance and the Existing Defaults described herein. Nothing in this Amendment shall be construed to (i) constitute a waiver of compliance or default by the Borrowers with respect to the Loan Documents in any other instance or any other instrument or agreement referred to in the Loan Documents; or (ii) prejudice any right or remedy that the Agent or any Lender may now have or may have in the future under or in connection with any Loan Document or any other instrument or agreement referred to therein.

2.03 Amendment to Loan Agreement. The definition of “Eligible Account” set forth in Section 1.1 of the Loan Agreement is hereby amended by inserting the following sentence immediately after the last sentence thereof:

“Without limiting the generality of the foregoing, no Accounts owing to MotorFist, LLC, a Minnesota limited liability company, are Eligible Accounts.”

2.04 Amendment to Loan Agreement Schedules. Schedules 1.1(A), 2.3, 8.5, 8.6.1, 9.1.4, 9.1.10, 9.1.11, 9.1.14, 9.1.15, 9.1.16(a), 9.1.16(b), 9.1.18, 9.1.20, 10.2.1, 10.2.2 and 10.2.16 to the Loan Agreement are hereby amended and restated in their entirety to read as set forth on Exhibit A attached hereto.

ARTICLE III

JOINDER AGREEMENT

3.01 Loan and Security Agreement. MotorFist agrees to, and does hereby, become a “Borrower” under the Loan Agreement and is bound by the Loan Agreement and each of the other Loan Documents with the same force and effect as if it were an original party thereto. Each party hereto hereby acknowledges and agrees that each reference in the Loan Agreement and each other Loan Document to a “Borrower” shall also mean and be a reference to MotorFist.

3.02 Guaranty. Without limiting the generality of the foregoing, subject to and in accordance with the terms and conditions of Section 5.10 of the Loan Agreement, MotorFist hereby agrees that it is jointly and severally liable and absolutely and unconditionally guarantees to Agent and Lenders the prompt payment and performance of, all Obligations and all agreements under the Loan Documents.

3.03 Security Interests. Without limiting the generality of the foregoing, MotorFist hereby grants to the Agent, for the benefit of the Secured Parties, a continuing security interest in, lien on, assignment of and right of setoff against, all Collateral of MotorFist, whether now owned or hereafter acquired or arising, regardless of where located to secure the Obligations (as defined in the Loan Agreement).

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

Each Obligor hereby represents and warrants to each Lender and the Agent, as of the Second Amendment Effective Date (as such term is defined in Section 5.01 below), as follows:

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4.01 Representations and Warranties. After giving effect to this Amendment, the representations and warranties set forth in Section 9 of the Loan Agreement and in each other Loan Document are true and correct in all material respects on and as of the date hereof and on and as of the Second Amendment Effective Date with the same effect as if made on and as of the date hereof or the Second Amendment Effective Date, as the case may be, except to the extent such representations and warranties expressly relate solely to an earlier date.

4.02 No Defaults. Each of the Obligors is in compliance with all terms and conditions of the Loan Agreement and the other Loan Documents on its part to be observed and performed and no Default or Event of Default has occurred and is continuing.

4.03 Authority and Pending Actions. The execution, delivery, and performance by each Obligor of this Amendment has been duly authorized by each such Obligor (as applicable) and there is no action pending or any judgment, order, or decree in effect which is likely to restrain, prevent, or impose materially adverse conditions upon the performance by any Obligor of its obligations under the Loan Agreement or the other Loan Documents.

4.04 Enforceability. This Amendment constitutes the legal, valid, and binding obligation of each Obligor, enforceable against each such Obligor in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization, or other similar laws affecting the enforcement of creditors’ rights or by the effect of general equitable principles.

4.05 Breach; Conflicts. The execution, delivery, and performance by each Obligor of this Amendment do not and will not conflict with, or constitute a violation or breach of, or result in the imposition of any Lien upon the property of such Obligor, by reason of the terms of (i) any contract, mortgage, lease, agreement, indenture, or instrument to which such Obligor is a party or which is binding upon it, (ii) any Applicable Law with respect to such Obligor, or (iii) the certificate or articles of incorporation or by-laws or the limited liability company or limited partnership agreement of such Obligor.

ARTICLE V

CONDITIONS PRECEDENT AND FURTHER ACTIONS

5.01 Conditions Precedent. The amendments contained in Article II and the joinder contained in Article III shall not be effective or binding upon the Agent or the Lenders until each of the following conditions precedent has been satisfied in form and substance satisfactory to the Agent (the first date upon which each such condition has been satisfied being herein called the “Second Amendment Effective Date”):

(a) The representations and warranties contained herein and in the Loan Agreement, as amended hereby, shall be true and correct in all material respects as of the date hereof, as if made on such date, except for such representations and warranties limited by their terms to a specific date;

(b) Agent shall have received duly executed counterparts of (i) this Amendment, which, when taken together, bear the authorized signatures of the Borrowers, the Agent, and the Lenders, (ii) an amended and restated revolver note payable to order of JPMorgan Chase Bank, N.A., which, when taken together, bear the authorized signatures of the Borrowers, (iii) a third amended and restated revolver note payable to the order of Bank of America, N.A., which, when taken together, bear the authorized signatures of the Borrowers, (iv) an amendment to the Pledge Agreement, which, when taken together, bear the authorized signatures of Arctic Cat, Arctic Cat Sales Inc., and the Agent, (v) the Patent

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Amendment, which, when taken together, bear the authorized signatures of Arctic Cat, Agent, and the Required Lenders, and (vi) a Trademark Security Agreement, which, when taken together, bear the authorized signatures of Motorfist and Agent;

(c) Agent shall have received acknowledgments of all filings or recordations necessary to perfect its Liens in the Collateral of MotorFist, as well as UCC and Lien searches and other evidence satisfactory to Agent that such Liens are the only Liens upon the Collateral of MotorFist, except Permitted Liens;

(d) Agent shall have received a certificate of a duly authorized officer of MotorFist certifying, after giving effect to this Amendment, (i) that attached copies of MotorFist’s Organic Documents are true and complete, and in full force and effect, without amendment except as shown; (ii) that an attached copy of resolutions authorizing execution and delivery of this Amendment is true and complete, and that such resolutions are in full force and effect, were duly adopted, have not been amended, modified or revoked, and constitute all resolutions adopted with respect to this credit facility; and (iii) to the title, name and signature of each Person authorized to sign the Loan Documents. Agent may conclusively rely on this certificate until it is otherwise notified by MotorFist in writing;

(e) Agent shall have received the certificates, if any, representing Equity Interests of MotorFist, and an undated stock power (or appropriate transfer document) for each such certificate executed in blank by a duly authorized officer of Arctic Cat;

(f) Agent shall have received copies of the charter documents of MotorFist, certified by the Secretary of State or other appropriate official of MotorFist’s jurisdiction of organization. Agent shall have received good standing certificates for MotorFist, issued by the Secretary of State or other appropriate official of MotorFist’s jurisdiction of organization and each jurisdiction where MotorFist’s conduct of business or ownership of Property necessitates qualification;

(g) The Obligors shall have paid to the Agent all fees, costs, and expenses owed to and/or incurred by the Agent and the Lenders in connection with this Amendment;

(h) Agent shall have received such other documents, legal opinions, instruments, and certificates relating to this Amendment as it shall reasonably request and such other documents, legal opinions, instruments, and certificates that shall be satisfactory in form and substance to the Agent and the Lenders. All corporate proceedings taken or to be taken in connection with this Amendment and documents incidental thereto whether or not referred to herein shall be reasonably satisfactory in form and substance to the Agent and the Lenders; and

(i) All proceedings taken in connection with the transactions contemplated by this Amendment and all documentation and other legal matters incident thereto shall be satisfactory to the Agent in its sole and absolute discretion.

5.02 Further Actions. Each of the parties to this Amendment agrees that at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Amendment.

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ARTICLE VI

COSTS AND EXPENSES

Without limiting the terms and conditions of the Loan Documents, the Obligors jointly and severally agree to pay on demand: (i) all reasonable costs and expenses incurred by the Agent in connection with the preparation, negotiation, and execution of this Amendment and the other Loan Documents executed pursuant to this Amendment and any and all subsequent amendments, modifications, and supplements to this Amendment, including without limitation, the reasonable costs and fees of the Agent’s legal counsel; and (ii) all reasonable costs and expenses reasonably incurred by the Agent in connection with the enforcement or preservation of any rights under the Loan Agreement, this Amendment, and/or the other Loan Documents, including without limitation, the reasonable costs and fees of the Agent’s legal counsel.

ARTICLE VII

MISCELLANEOUS

7.01 Cross-References. References in this Amendment to any Section are, unless otherwise specified, to such Section of this Amendment.

7.02 Instrument Pursuant to Loan Agreement. This Amendment is a Loan Document executed pursuant to the Loan Agreement and shall (unless otherwise expressly indicated herein) be construed, administered, and applied in accordance with the terms and provisions of the Loan Agreement.

7.03 Acknowledgment of the Obligors. Each Obligor hereby represents and warrants that the execution and delivery of this Amendment and compliance by such Obligor with all of the provisions of this Amendment: (i) are within the powers and purposes of such Obligor; (ii) have been duly authorized or approved by the board of directors (or other appropriate governing body) of such Obligor; and (iii) when executed and delivered by or on behalf of such Obligor will constitute valid and binding obligations of such Obligor, enforceable in accordance with its terms. Each Obligor reaffirms its obligations to perform and pay all amounts due to the Agent or the Lenders under the Loan Documents (including, without limitation, its obligations under any promissory note evidencing any of the Loans) in accordance with the terms thereof, as amended and modified hereby.

7.04 Loan Documents Unmodified. Each of the amendments provided herein shall apply and be effective only with respect to the provisions of the Loan Document specifically referred to by such amendments. Except as otherwise specifically modified by this Amendment, all terms and provisions of the Loan Agreement and all other Loan Documents, as modified hereby, shall remain in full force and effect and are hereby ratified and confirmed in all respects. Nothing contained in this Amendment shall in any way impair the validity or enforceability of the Loan Documents, as modified hereby, or alter, waive, annul, vary, affect, or impair any provisions, conditions, or covenants contained therein or any rights, powers, or remedies granted therein, except as otherwise specifically provided in this Amendment. Subject to the terms of this Amendment, any lien and/or security interest granted to the Agent, for the benefit of the Lenders, in the Collateral set forth in the Loan Documents shall remain unchanged and in full force and effect and the Loan Agreement and the other Loan Documents shall continue to secure the payment and performance of all of the Obligations.

7.05 Parties, Successors and Assigns. This Amendment represents the agreement of the Borrowers, the Agent and each of the Lenders signatory hereto with respect to the subject matter hereof, and there are no promises, undertakings, representations, or warranties relative to the subject matter

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hereof not expressly set forth or referred to herein or in the other Loan Documents. This Amendment shall be binding upon and inure to the benefit of Borrowers, Agent, Lenders, and their respective successors and assigns, except that (i) no Borrower shall have the right to assign its rights or delegate its obligations under any Loan Documents; and (ii) any assignment by a Lender must be made in compliance with Section 13.3 of the Loan Agreement.

7.06 Counterparts. This Amendment may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment shall become effective when all conditions precedent have been met and when the Agent has executed it and received counterparts bearing the signatures of all other parties hereto. Delivery of a signature page of this Amendment by telecopy shall be effective as delivery of a manually executed counterpart of such agreement. This Amendment may be executed and delivered by facsimile or electronic mail, and will have the same force and effect as manually signed originals. Any electronic signature, contract formation on an electronic platform and electronic record-keeping shall have the same legal validity and enforceability as a manually executed signature or use of a paper-based recordkeeping system to the fullest extent permitted by Applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any similar state law based on the Uniform Electronic Transactions Act.

7.07 Headings. The headings, captions, and arrangements used in this Amendment are for convenience only, are not a part of this Amendment, and shall not affect the interpretation hereof.

7.08 Waivers. To the fullest extent permitted by Applicable Law, each Borrower waives (a) the right to trial by jury (which the Agent and each Lender hereby also waives) in any proceeding or dispute of any kind relating in any way to any Loan Documents (including this Amendment), Obligations, or Collateral; (b) presentment, demand, protest, notice of presentment, default, non-payment, maturity, release, compromise, settlement, extension or renewal of any commercial paper, accounts, documents, instruments, chattel paper, and guaranties at any time held by the Agent on which a Borrower may in any way be liable, and hereby ratifies anything the Agent may do in this regard; (c) notice prior to taking possession or control of any Collateral; (d) any bond or security that might be required by a court prior to allowing the Agent to exercise any rights or remedies; (e) the benefit of all valuation, appraisement and exemption laws; (f) any claim against the Agent, Issuing Bank or any Lender, on any theory of liability, for special, indirect, consequential, exemplary, or punitive damages (as opposed to direct or actual damages) in any way relating to any Enforcement Action, Obligations, Loan Documents or transactions relating thereto; and (g) notice of acceptance hereof. Each Borrower acknowledges that the foregoing waivers are a material inducement to the Agent, Issuing Bank and Lenders entering into this Amendment and that the Agent, Issuing Bank and Lenders are relying upon the foregoing in their dealings with the Borrowers. Each Borrower has reviewed the foregoing waivers with its legal counsel and has knowingly and voluntarily waived its jury trial and other rights following consultation with legal counsel. In the event of litigation, this Amendment may be filed as a written consent to a trial by the court.

7.09 Choice of Law; Jury Trial Waiver; Submission to Jurisdiction. THIS AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS, WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS). EACH BORROWER HEREBY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL OR STATE COURT SITTING IN OR WITH JURISDICTION OVER THE STATE OF ILLINOIS, IN ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING RELATING IN ANY WAY TO ANY LOAN DOCUMENTS, AND AGREES THAT ANY DISPUTE, ACTION, LITIGATION OR

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OTHER PROCEEDING SHALL BE BROUGHT BY IT SOLELY IN ANY SUCH COURT. EACH BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL CLAIMS, OBJECTIONS AND DEFENSES THAT IT MAY HAVE REGARDING ANY SUCH COURT’S PERSONAL OR SUBJECT MATTER JURISDICTION, VENUE OR INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 14.3.1 OF THE LOAN AGREEMENT. A final judgment in any proceeding of any such court shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or any other manner provided by Applicable Law. Nothing herein shall limit the right of the Agent or any Lender to bring proceedings against any Obligor in any other court, nor limit the right of any party to serve process in any other manner permitted by Applicable Law. Nothing in this Amendment shall be deemed to preclude enforcement by the Agent of any judgment or order obtained in any forum or jurisdiction.

7.10 Severability. Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be valid under Applicable Law. If any provision is found to be invalid under Applicable Law, it shall be ineffective only to the extent of such invalidity and the remaining provisions of the Loan Documents shall remain in full force and effect.

7.11 Total Agreement. This Amendment, the Loan Agreement, and all other Loan Documents constitute the entire agreement, and supersede all prior understandings and agreements among the parties relating to the subject matter hereof.

7.12 Release. IN CONSIDERATION OF THIS AMENDMENT, EACH OBLIGOR REPRESENTS AND WARRANTS THAT AS OF THE DATE HEREOF THERE ARE NO KNOWN CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS, AND HEREBY WAIVES ANY AND ALL CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF ITS EXECUTION OF THIS AMENDMENT AND RELEASES AND DISCHARGES AGENT, EACH LENDER AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SHAREHOLDERS, AFFILIATES AND ATTORNEYS (COLLECTIVELY THE “RELEASED PARTIES”) FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH SUCH OBLIGOR HAS OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment as of the day and year first written above.

BORROWERS:
ARCTIC CAT INC., a Minnesota corporation
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title:   Chief Financial Officer
ARCTIC CAT SALES INC., a Minnesota corporation
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title:   Chief Financial Officer
ARCTIC CAT PRODUCTION LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title:   Chief Financial Officer
ARCTIC CAT PRODUCTION SUPPORT LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title:   Chief Financial Officer
ARCTIC CAT SHARED SERVICES LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title:   Chief Financial Officer
MOTORFIST, LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title:   Treasurer

Notice Address for Borrowers:
	505 Waterford Park, Suite 1000
	505 N. Highway 169
	Plymouth, MN 55441
	Attn:	Christopher J. Eperjesy, CFO
	Telecopy:	763.354.1803

BANK OF AMERICA, N.A.,
as Agent and Lender
By:	/s/ Brian Conole

Name:	Brian Conole
Title:	Senior Vice President
Address:	Bank of America Business Capital
	20975 Swenson Drive, Suite 200
	Waukesha, WI 53186
Telecopy:	262.207.3347

JPMORGAN CHASE BANK, N.A.,
as Lender
By:	/s/ Ray Gage
Name:	Ray Gage
Title:	Authorized Officer

EXHIBIT A

SCHEDULE 1.1(A), 2.3, 8.5, 8.6.1, 9.1.4, 9.1.10, 9.1.11, 9.1.14,

9.1.15, 9.1.16(a), 9.1.16(b), 9.1.18, 9.1.20, 10.2.1, 10.2.2 and 10.2.16

to

Loan

Agreement

EXHIBIT A

Amended and Restated Schedules to the

Amended and Restated Loan and Security Agreement

SCHEDULE 1.1(A)

Foreign Account Debtors

AUSTRALIA

        PS Importers PTY Ltd.

        20 Stubbs St.

        Kensington, Australia

AUSTRIA

        HOLLEIS HANDELS GmbH

        Saalfeldnerstrasse 41

        A – 5751 Maishofen, AUSTRIA

FINLAND

        SUMEKO

        The SGN Group

        Juurakkokuja 4

        FI-01510, Vantaa, FINLAND

        STREET ADDRESS

        The SGN Group

        Juurakkokuja 4

        FI-01510, Vantaa, FINLAND

MEXICO

        MOOV MEXICO S.A. de C.V.

        Compressor No. 2237 Col. Alamo Industrial

        Tlaquepaqua, Mexico

NORWAY

        ERLING SANDE A.S.

        Ovre Eiker vei 77

        3048 Drammen, NORWAY

        Invoice Address

        Erling Sande A/S

        PO Box 4114, Gulskogen

        3005 Drammen, NORWAY

RUSSIA

        SUMEKO RUSSIA

        PO Box 15

        FIN-02631, Espoo, FINLAND

        STREET ADDRESS

        Nihtisillankuja 6

        FIN-02630, Espoo, FINLAND

SWEDEN

        KGK SUZUKI A.B

        Sales and Administration

        Hammarbacken 8

        S-191 81 Sollentuna, SWEDEN

        KGK SUZUKI A.B

        Service and Warranty

        Brosslarvagen 19b

        831 72 Ostersund SWEDEN

SWITZERLAND

        SNOPE X S.A.

        Via Molta 3

        Belerna,

        SWITZERLAND

SCHEDULE 2.3

EXISTING LETTERS OF CREDIT

Letter of Credit #	Beneficiary	Amount
64604494	Asahi Denso Co. Ltd.	$	476,567.21
64604496	Suzuki Motor Corporation	$	617,537.97
64739741	Chao Yang Electronic Components	$	41,928.93
68047654	State of Minnesota	$	2,767,833.00

SCHEDULE 8.5

DEPOSIT ACCOUNTS

ARCTIC CAT INC.

Depository Bank	Type of Account	Account Numbers
Wells Fargo	Arctic Cat Inc. Operating	#####
Wells Fargo	Workers Comp.	#####
Bank of America	Blocked Account	#####
Bank of America	Blocked Account	#####
Bank of America	Controlled Disbursement Account	#####
Bank of America	Controlled Disbursement Account	#####
Bank of America	N/A – Not Used	#####
Bank of America	Self-Insured Workers Comp.	#####
Bank of America	AC Shared Services LLC/ Payroll/ Payroll Taxes	#####
Bank of America	AC Production Support LLC/ Payroll/Payroll Taxes	#####
Bank of America	AC Production LLC/ Payroll / Payroll Taxes	#####
Wells Fargo	Accounts Payable	#####

ARCTIC CAT SALES INC.

Depository Bank	Type of Account	Account Numbers
Wells Fargo	General	#####
Wells Fargo	Collateral Account Lockbox	#####
Bank of America	Operating Account – Canada	#####
Bank of America	Blocked Account	#####

MOTORFIST, LLC

Depository Bank	Type of Account	Account Numbers
Wells Fargo	General (for Corp. Credit Cards)	#####
Bank of America	Operating (CAD)	#####
Bank of America	Operating (CAD)	#####

SCHEDULE 8.6.1

BUSINESS LOCATIONS

1. Borrowers currently have the following business locations:

Chief Executive Office:	505 Waterford Park, Suite 1000
	Plymouth, MN 55441
Other Locations:	601 Brooks Avenue South
	Thief River Falls, Minnesota 56701
	817 Lowell Drive
	Thief River Falls, Minnesota 56701
	17440 U.S. Highway 59
	Thief River Falls, Minnesota 56701
	6801 Glen Carlson Drive
	St. Cloud, Minnesota 56301
	4567 North Highway 20
	Island Park, Idaho 83429
	215 Crossroads Boulevard
	Bucyrus, Ohio 44820
	57/59 Murray Park Rd.
	Winnipeg, Manitoba, Canada
	586 First Street
	Idaho Falls, Idaho 83401
	4116 N. 4800 E.
	Rigby, Idaho 83401
	Arctic Cat GmbH
	Industriestraße 43
	5600 St. Johann
	Pongau, Austria

2. In the five years preceding the date hereof, Borrowers have had no office or place of business located in any county other than as set forth above, except: NONE

3. Each Obligor that is a Subsidiary currently has the following business locations, and no others:

Chief Executive Office: Same location as Arctic Cat Inc.

Other Locations: All Obligors that are Subsidiaries are located at one of the business locations set forth above.

4. In the five years preceding the date hereof, no Obligor that is a Subsidiary has had an office or place of business located in any county other than as set forth above, except: NONE

5. The following bailees, warehouseman, similar parties and consignees hold inventory of a Borrower:

Name and Address of Party	Nature of Relationship	Owner of Inventory
Big Freight Systems, Inc. 360 Highway 12 North Steinbach, Manitoba R5G 1A6 Canada	Warehouseman	Arctic Cat Sales Inc.
De Lue Haulers 6377 Knickerbocker Road Ontario, New York 14159	Warehouseman	Arctic Cat Sales Inc.
Ruan Transport Corporation 7101 Winnetka Avenue Brooklyn Park, Minnesota 55428	Warehouseman	Arctic Cat Sales Inc.
Superior Third Party Logistics, Inc. 1700 Wynne Avenue St. Paul, Minnesota 55108	Warehouseman	Arctic Cat Sales Inc.
Porter Warehousing & Distribution, Inc. 15703-114th Ave Edmonton, Alberta T5M 2Z3 Canada	Warehouseman	MotorFist, LLC

SCHEDULE 9.1.4

NAMES AND CAPITAL STRUCTURE

1. The corporate names, jurisdictions of incorporation, and authorized and issued Equity Interests of each Borrower and Subsidiary are as follows:

Name	Jurisdiction	Number and Class of Authorized Shares/ Membership Units	Number and Class of Issued Shares/ Membership Units
Arctic Cat Inc.	Minnesota	45,000,000 shares of Common Stock; 2,200,000 shares of undesignated Preferred Stock; 300,000 shares of Series B Junior Participating Preferred Stock	13,446,302 shares of Common Stock; 0 shares of undesignated Preferred Stock; 0 shares of Series B Preferred Stock
Arctic Cat Sales Inc.	Minnesota	50,000	1,000
Arctic Cat Production LLC	Minnesota	1,000	1,000
Arctic Cat Production Support LLC	Minnesota	1,000	1,000
Arctic Cat Shared Services LLC	Minnesota	1,000	1,000
Arctic Cat ACE Holding GmbH	Austria	Registered Capital of EUR 35,000	N/A
Arctic Cat GmbH	Austria	Registered Capital of EUR 1,313,700	N/A
ARCTIC CAT France SARL	France	N/A	N/A
ARCTIC CAT Deutschland GmbH	Germany	N/A	N/A
ARCTIC CAT Italia S.R.L.	Italy	N/A	N/A
ARCTIC CAT España S.L.	Spain	N/A	N/A
MotorFist, LLC	Minnesota	100	100

2. The record holders of Equity Interests of each Borrower and Subsidiary are as follows:

Name	Class of Stock	Number of Shares/ Membership Units	Record Owner
Arctic Cat Inc.	Common Stock	13,446,302	Publicly traded company

Name	Class of Stock	Number of Shares/ Membership Units	Record Owner
	Preferred Stock	0	None.
Arctic Cat Sales Inc.	Common stock	1,000	Arctic Cat Inc.
Arctic Cat Production LLC	Membership interest	1,000	Arctic Cat Inc.
Arctic Cat Production Support LLC	Membership interest	1,000	Arctic Cat Inc.
Arctic Cat Shared Services LLC	Membership interest	1,000	Arctic Cat Inc.
Arctic Cat ACE Holding GmbH	Capital Stock	N/A	Arctic Cat Sales Inc.
Arctic Cat GmbH	Capital Stock	N/A	Arctic Cat ACE Holding GmbH
ARCTIC CAT France SARL		N/A	Arctic Cat GmbH
ARCTIC CAT Deutschland GmbH		N/A	Arctic Cat GmbH
ARCTIC CAT Italia S.R.L.		N/A	Arctic Cat GmbH
ARCTIC CAT España S.L.		N/A	Arctic Cat GmbH
MotorFist, LLC	Membership Interest	100	Arctic Cat Sales Inc.

3. All agreements binding on holders of Equity Interests of Borrowers and Subsidiaries with respect to such interests are as follows:

Arctic Cat Inc. 2007 Omnibus Stock and Incentive Plan

Form of Incentive Stock Option Agreement for 2007 Stock Plan

Form of Non-Qualified Stock Option Agreement for 2007 Stock Plan

Form of Director Non-Qualified Stock Option Agreement for 2007 Stock Plan

First Amendment to Arctic Cat Inc. 2007 Omnibus Stock and Incentive Plan (August 7, 2009) Arctic Cat Inc. 2002 Omnibus Stock and Incentive Plan

Form of Incentive Stock Option Agreement for 2002 Stock Plan

Form of Non-Qualified Stock Option Agreement for 2002 Stock Plan

Form of Director Non-Qualified Stock Option Agreement for 2002 Stock Plan

Form of Arctic Cat Inc. Stock-Settled Appreciation Rights Agreement

Form of Arctic Cat Inc. Restricted Stock Agreement

Member Control Agreement of MotorFist, LLC, dated February 18, 2015, by and between MotorFist, LLC and Arctic Cat Sales Inc.

Arctic Cat Inc. 2013 Omnibus Stock and Incentive Plan

Form of Incentive Stock Option Agreement for 2013 Stock Plan

Form of Non-Qualified Stock Option Agreement for 2013 Stock Plan

Form of Director Non-Qualified Stock Option Agreement for 2013 Stock Plan

Form of Arctic Cat Inc. Restricted Stock Unit Agreement (separate for officers and non-employee directors) for 2013 Stock Plan

4. In the five years preceding the date hereof, no Borrower or Subsidiary has acquired any substantial assets from any other Person nor been the surviving entity in a merger or combination except:

MotorFist, LLC, a Minnesota limited liability company (“Buyer”) and wholly owned subsidiary of Arctic Cat Sales Inc., a Minnesota corporation (“Parent”), purchased substantially all the assets of MotorFist, LLC, an Idaho limited liability company (“Seller), pursuant to that certain Asset Purchase Agreement, dated as of February 25, 2015, by and among Buyer, Seller, with respect to certain specified provisions, Brad A. Ball, as Member, and solely with respect to Section 6.13 of the Asset Purchase Agreement, Parent.

SCHEDULE 9.1.10

BROKERS

NONE.

SCHEDULE 9.1.11

PATENTS, TRADEMARKS, COPYRIGHTS, LICENSES, AND DOMAIN NAMES

1. As of 15 April 2015, Borrowers’ patents:

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Adjustable Headlight	U.S.	10/262,756	Filed: 10/1/2002; Issue Date: 11/29/2005	6,969,184	Expires 10/01/2022. 11.5 Maintenance Fee Due 05/29/2017.	Arctic Cat Inc.
Adjustable Riser Assembly	U.S.	11/680,454	Filed: 2/28/2007; Issue Date: 3/26/2013	8,402,861	Expires 04/8/2030. 3.5 Year Maintenance Fee Due 09/26/2016; 7.5 Year Maintenance Fee Due 09/26/2020; 11.5 Year Maintenance Fee Due 09/26/2024.	Arctic Cat Inc.
Adjustable Seat Assembly	U.S.	11/680,481	Filed: 2/28/2007 Issue Date: 05/31/2011	7,950,736	Expires 04/15/2027. 3.5 Year Maintenance Fee Due 5/31/2015; 7.5 Year Maintenance Fee Due 11/30/2018; 11.5 Year Maintenance Fee Due 11/30/2022.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Adjustable Steering Assembly	U.S.	11/740,228	Filed: 4/25/2007; Issue Date 07/10/2012	8,215,201	Expires 02/05/2030. 3.5 Year Maintenance Fee Due 01/10/2016; 7.5 Year Maintenance Fee Due 01/10/2020; 11.5 Year Maintenance Fee Due 01/10/2024.	Arctic Cat Inc.
Adjustable Steering Assembly	U.S.	13/495,886	Filed: 6/13/2012; Issue Date 02/26/2013	8,381,611	Expires 04/25/2027. 3.5 Year Maintenance Fee Due 08/26/2016; 7.5 Year Maintenance Fee Due 08/26/2020; 11.5 Year Maintenance Fee Due 08/26/2024.	Arctic Cat Inc.
Air Intake System for a Vehicle	U.S.	10/007,222	Filed: 11/2/2001 Issue Date: 11/29/2005	6,968,916	Expires 11/20/2021. 11.5 Maintenance Fee Due 5/29/2017.	Arctic Cat Inc.
Clutch Shield	U.S.	10/269,703	Filed: 10/10/2002 Issue Date: 3/8/2005	6,863,145	Expires 11/23/2022. 11.5 Maintenance Fee Due 09/08/2016.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Drive Clutch Fan for CVT Transmission	U.S.	13/408,781	Filed: 02/29/2012 Issue Date: 07/15/2014	8,776,930	Expires: 3/16/2032; 3.5 Year Maintenance Fee Due 1/15/2018; 7.5 Year Maintenance Fee Due 1/15/2022; 11.5 Year Maintenance Fee Due 1/15/2026.	Arctic Cat Inc.
Redacted	Canada	Pending	Filed: 02/25/2012	Pending	Redacted	Arctic Cat Inc.
Dual Cam Surface Clutch	U.S.	10/947,733	Filed: 9/23/2004 Issue Date: 5/2/2006	7,037,226	Expires 10/01/2022. 11.5 Maintenance Fee Due 11/02/2017.	Arctic Cat Inc.
Redacted – “Exhaust Outlet” technology	US	pending	pending	pending	In draft form but not yet filed	Arctic Cat Inc.
Foam Padded Seat with Storage Space	U.S.	10/283,383	Filed: 10/29/2002 Issue Date: 9/5/2006	7,100,979	Expires 10/29/2022. 11.5 Maintenance Fee Due 03/05/2018.	Arctic Cat Inc.
Fuel Tank for a Straddle-Mounted Vehicle	U.S.	10/134,719	Filed: 4/29/2002 Issue Date: 7/6/2004	6,758,497	Expires 06/20/2022. 11.5 Maintenance Fee Due 06/06/2016.	Arctic Cat Inc.
Grooved Oil Pan for Use with a Snowmobile	U.S.	10/122,430	Filed: 4/11/2002 Issue Date: 8/2/2005	6,923,283	Expires 05/19/2023. 11.5 Maintenance Fee Due 02/02/2017.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Layered Snowmobile Tunnel	US	13/028,993	Filed: 2/16/2011 Issue Date: 09/10/2013	8,528,683	Expires: 08/15/2031 3.5 Maintenance Fee Due 03/10/2017; 7.5 Maintenance Fee due 03/10/2021; 11.5 Maintenance Fee Due 03/10/2025	Arctic Cat Inc.
Ignition Timing Control System	U.S.	10/454,861	Filed: 6/5/2003 Issue Date: 10/4/2005	6,951,203	Expires 06/05/2023. 11.5 Maintenance Fee Due 04/04/2017.	Arctic Cat Inc.
Idler Wheel Assembly for Snowmobile	U.S.	13/307,758	Filed: 11/30/2011 Issue Date: 05/27/2014	8,733,490	Expires: 11/30/2031; 3.5 Year Maintenance Fee Due 11/27/2017; 7.5 Year Maintenance Fee Due 11/27/2021; 11.5 Year Maintenance Fee Due 11/27/2025.	Arctic Cat Inc.
Idler Wheel Assembly for Snowmobile	Canada	Pending	Filed: 10/25/2011	Pending	Maintenance Fee Due 10/25/2015; Request for Examination Due 10/25/2017.	Arctic Cat Inc.
Integral Bumper and Skid Plate	U.S.	10/215,785	Filed: 8/8/2002 Issue Date: 5/10/2005	6,890,010	Expires 12/17/2022; 11.5 Maintenance Fee Due 11/10/2016.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Integral Bumper and Skid Plate	Canada	2411314	Filed: 11/6/2002 Issue Date: 12/30/2008	2411314	Annual Maintenance Fee Due 11/06/2015.	Arctic Cat Inc.
Internal Combustion Engine with Pneumatically Controlled Variable Exhaust Valve	U.S.	09/312,574	Filed: 5/14/1999 Issue Date: 4/17/2001	6,216,648	Expires 05/14/2019.	Arctic Cat Inc.
Linked Suspension System for a Vehicle	U.S.	10/008,455	Filed: 11/2/2001 Issue Date: 12/20/2005	6,976,689	Expires 7/22/2022. 11.5 Maintenance Fee Due 06/20/2017.	Arctic Cat Inc.
Linked Suspension System for a Vehicle	Canada	2361044	Filed: 11/2/2001 Issue Date: 12/5/2006	2,361,044	Expires 11/2/2021. Annual Maintenance Fee Due 11/02/2015.	Arctic Cat Inc.
Low Noise Track Profile	U.S.	10/373,601	Filed: 2/24/2003 Issue Date: 8/2/2005	6,923,515	Expires 02/24/2023. 11.5 Maintenance Fee Due 02/02/2017.	Arctic Cat Inc.
Low Noise Track Profile	Europe	4445014.6	Filed: 2/20/2004 Issue Date: 1/10/2007	1449750	Expires 02/20/2024.	Arctic Cat Inc.
Low Noise Track Profile	Europe- Finland	1449750	Filed: 1/10/2007 Issue Date: 1/10/2007	195449750	Expires 02/20/2024. Annual Maintenance Fees Due 02/28/2016.	Arctic Cat Inc.
Low Noise Track Profile	Europe- Sweden	1449750	Filed: 4/5/2007 Issue Date: 1/10/2007	1449750	Expires 02/20/2024. Annual Maintenance Fees Due 02/28/2016.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Low Noise Track Profile	Canada	2457290	Filed: 2/11/2004 Issued Date: 12/20/2010	2457290	Annual Maintenance Fee Due 02/11/2016.	Arctic Cat Inc.
Multi-Location Fuel Injection System	U.S.	11/143,884	Filed: 6/2/2005 Issue Date: 1/30/2007	7,168,401	Expires 06/02/2025 11.5 Maintenance Fee Due 7/30/2018.	Arctic Cat Inc.
Redacted: “skidframe” technology	US	14/109,760	Filed: 12/17/2013	Pending	Redacted	Arctic Cat Inc.
Redacted: “skidframe” technology	PCT	PCT/US14/70669	Filed: 12/16/2014	Pending	Redacted	Arctic Cat Inc.
Position-Sensitive Shock Absorber	U.S.	10/373,606	Filed: 2/24/2003 Issue Date: 11/22/2005	6,966,412	Expires 02/24/2023. 11.5 Maintenance Fee Due 05/22/2017.	Arctic Cat Inc.
Regulator Bearing Mount	U.S.	10/172,577	Filed: 6/13/2002 Issue Date: 1/18/2005	6,843,603	Expires 06/13/2022. 11.5 Maintenance Fee Due 7/18/2016.	Arctic Cat Inc.
Reversible Rear Axle Mount	U.S.	10/093,249	Filed: 3/6/2002 Issue Date: 7/13/2004	6,761,236	Expires 7/04/2022. 11.5 Maintenance Fee Due 01/13/2016.	Arctic Cat Inc.
Seating System Configurable Between One-Person to Two- Person Configurations, and Method for Configuring Same	U.S.	09/579,614	Filed: 5/26/2000 Issue Date: 12/10/2002	6,491,124	Expires 05/26/2020.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Snowmobile Air Box Assembly	U.S.	10/290,844	Filed: 11/7/2002 Issue Date: 9/5/2006	7,100,730	Expires 10/08/2023. 11.5 Maintenance Fee Due 3/5/2018.	Arctic Cat Inc.
Snowmobile Air Box Assembly	U.S.	11/424,793	Filed: 6/16/2006 Issue Date: 5/6/2008	7,367,418	Expires 12/04/2022. 7.5 Maintenance Fee Due 11/06/2015; 11.5 Maintenance Fee Due 11/06/2019.	Arctic Cat Inc.
Snowmobile Drive Track	U.S.	10/786,583	Filed: 2/23/2004 Issue Date: 9/9/2008	7,422,295	Expires 2/23/2004. 7.5 Maintenance Fee Due 03/09/2016; 11.5 Maintenance Fee Due 03/09/2020.	Arctic Cat Inc.
Snowmobile Drive Track	Canada	2458321	Filed: 2/23/2004	Pending	Annual Maintenance Fee Due 02/23/2016.	Arctic Cat Inc.
Snowmobile Drive Track with Double Angled Lugs (Power Claw)	U.S.	11/840,093	Filed: 8/16/2007 Issue Date: 5/11/2010	7,712,846	Expires 09/20/2024 7.5 Maintenance Fee Due 11/11/2017; 11.5 Maintenance Fee Due 11/11/2021.	Arctic Cat Inc.
Snowmobile Exhaust Exit	U.S.	10/948,964	File: 9/24/2004 Issue Date: 9/13/2005	6,942,052	Expires 09/24/2024; 11.5 Maintenance Fee Due 03/13/2017.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Snowmobile Exhaust Exit	Canada	2520794	Filed: 9/23/2005 Issue Date: 9/2/2008	2,520,794	Expires 09/23/2025; Annual Maintenance Fee Due 09/23/2016.	Arctic Cat Inc.
Snowmobile Planetary Drive System	U.S.	09/843,587	Filed: 4/26/2001 Issue Date: 6/21/2005	6,907,951	Expires 08/15/2020. 11.5 Maintenance Fee Due 12/21/2016.	Arctic Cat Inc.
Snowmobile Planetary Drive System	U.S.	09/966,926	Filed: 9/27/2001 Issue Date: 6/1/2004	6,742,618	Expires 03/07/2020. 11.5 Maintenance Fee Due 12/1/2015.	Arctic Cat Inc.
Snowmobile Planetary Drive System	U.S.	10/859,394	Filed: 6/1/2004 Issue Date: 6/20/2006	7,063,639	Expires 03/07/2020. 11.5 Maintenance Fee Due 12/20/2017.	Arctic Cat Inc.
Snowmobile Remote Ignition System	U.S.	10/353,281	Filed: 1/28/2003 Issue Date: 3/29/2005	6,871,624	Expires 01/28/2023. 11.5 Maintenance Fee Due 09/29/2016.	Arctic Cat Inc.
Snowmobile Remote Ignition System	U.S.	11/091,188	Filed: 03/28/2005 Issue Date: 11/28/2006	7,140,338	Expires 01/28/2023. 11.5 Maintenance Fee Due 05/28/2018.	Arctic Cat Inc.
Snowmobile Track Suspension	U.S.	11/061,117	Filed: 2/18/2005 Issue Date: 4/22/2008	7,360,618	Expires 4/27/2026; 7.5 year Maintenance Fee due 10/22/2015; 11.5 year Maintenance Fee due 10/22/2019.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Snowmobile Tunnel and Rear Heat Exchanger	U.S.	10/953,940	Filed: 9/29/2004 Issue Date: 2/12/2008	7,328,765	Expires 01/06/2023; 7.5 Maintenance Fee Due 08/12/2015; 11.5 Maintenance Fee Due 08/12/2019	Arctic Cat Inc.
Snowmobile Tunnel and Rear Heat Exchanger	U.S.	11/680,465	Filed: 2/28/2007 Issue Date: 08/24/2010	7,779,944	Expires 07/02/2026; 7.5 Maintenance Fee Due 02/24/2018; 11.5 Maintenance Fee Due 02/24/2022	Arctic Cat Inc.
Staggered Ski Skag	U.S.	10/439,640	Filed: 5/16/2003 Issue Date: 2/10/2009	7,487,974	Expires 05/16/2023; 7.5 Maintenance Fee Due 8/10/2016; 11.5 Maintenance Fee Due 08/10/2020	Arctic Cat Inc.
Staggered Ski Skag	Canada	2467319	Filed: 5/14/2004 Issued: 10/04/2011	2467319	Annual Maintenance Fee Due 05/14/2015.	Arctic Cat Inc.
Steering Post for Recreational Vehicle	U.S.	10/290,847	Filed: 11/7/2002 Issue Date: 4/17/2007	7,204,497	Expires 02/16/2023. 11.5 Maintenance Fee Due 10/17/2018.	Arctic Cat Inc.
Temperature-Controlled Fuel Injection System or Two-Stoke Engine	U.S.	11/185,912	Filed: 7/20/2005 Issue Date: 8/21/2007	7,258,107	Expires 05/07/2023. 11.5 Maintenance Fee Due 02/21/2019.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Three-Point Engine Mount	U.S.	10/224,858	Filed: 8/20/2002 Issue Date: 8/1/2006	7,083,024	Expires 08/20/2022. 11.5 Maintenance Fee Due 02/01/2018.	Arctic Cat Inc.
Two-Cycle Engine with Exhaust Temperature- Controlled Ignition Timing	U.S.	09/452,657	Filed: 12/1/1999 Issue Date: 5/29/2001	6,237,566	Expires 12/1/2019.	Arctic Cat Inc.
Two-Cycle Engine with Exhaust Temperature- Controlled Ignition Timing	U.S.	09/568,449	Filed: 5/10/2000 Issue Date: 4/16/2002	6,371,082	Expires 12/1/2019.	Arctic Cat Inc.
Two-Cycle Engine with Exhaust Temperature- Controlled Ignition Timing	U.S.	10/123,773	Filed: 4/16/2002 Issue Date: 4/22/2003	6,550,450	Expires 12/1/2019.	Arctic Cat Inc.
Two-Cycle Engine with Exhaust Temperature- Controlled Ignition Timing	Canada	2322738	Filed: 10/10/2000 Issue Date: 2/18/2003	2322738	Expires 10/10/2020. Annual Maintenance Fees Due 10/10/2015.	Arctic Cat Inc.
U-Joint Progressive Steering Arrangement	U.S.	11/680,487	Filed: 2/28/2007 Issue Date: 11/17/2009	7,617,900	Expires 11/03/2027. 7.5 Maintenance Fee Due 05/17/2017; 11.5 Maintenance Fee Due 05/17/2021	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Vehicle Tracking Control System	U.S.	11/061,317	Filed: 2/18/2005 Issue Date: 5/20/2008	7,374,188	Expires 11/08/2025; 7.5 year Maintenance fee due 11/20/2015; 11.5 year Maintenance fee due 11/20/2019.	Arctic Cat Inc.
HELMET WITH INTEGRATED HEAD LIGHT	U.S.	11/061,371	Filed: 2/17/2005 Issue Date: 10/19/2010	7,814,578	Expires 1/30/2027; 7.5 year Maintenance Fee due 4/19/2014 11.5 year Maintenance Fee due 4/19/2022	Arctic Cat Inc.
HELMET WITH VENTILATION FOR FOG MANAGEMENT AND RESPIRATION	U.S.	09/778,832	Filed: 2/8/2001 Issue Date: 7/30/2002	6,425,143	Expires 2/8/2021;	Arctic Cat Inc.
HELMET WITH VENTILATION FOR FOG MANAGEMENT AND RESPIRATION	Canada	2,336,548	Filed: 2/14/2001 Issue Date: 12/15/2009	2336548	Annual Maintenance Fee due 2/14/2015	Arctic Cat Inc.
Partially Redacted “speedrack lock” technology	U.S.	Pending	Unfiled	Pending	Redacted	Arctic Cat Inc.
All-Terrain Vehicle Engine Configuration	U.S.	11/129,069	Filed: 05/12/2005 Issue Date: 10/21/2008	7,438,153	Expires 11/27/2025; 7.5 Maintenance Fee Due 04/21/2016; 11.5 Maintenance Fee Due 04/21/2020	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
All-Terrain Vehicle Reverse Gear Protection	U.S.	11/119,410	Filed: 04/28/2005 Issue Date: 9/9/2008	7,422,545	Expires 04/11/2026. 7.5 Maintenance Fee Due 03/09/2016; 11.5 Maintenance Fee Due 03/09/2020	Arctic Cat Inc.
All-Terrain Vehicle Reverse Gear Protection	Canada	2545209	Filed: 4/27/2006 Issue Date: 08/18/2009	2545209	Annual Maintenance Fee Due 04/27/2016.	Arctic Cat Inc.
Axle Nut Retainer	U.S.	13/603,188	Filed: 09/04/2012 Issue Date: 02/10/2015	8,950,824	Expires 05/23/2033; 3.5-Year Maintenance Fee Due 08/10/2018; 7.5-Year Maintenance Fee Due 8/10/2022; 11.5-Year Maintenance Fee Due 08/10/2026.	Arctic Cat Inc.
Redacted	Canada	Pending	Filed: 03/03/2015	Pending	Redacted	Arctic Cat Inc.
Compact Steering Mechanism	U.S.	13/452,085	Filed: 04/20/2012 Issue Date: 04/29/2014	8,708,358	Expires: 04/20/2032; 3.5 Maintenance Fee Due 10/29/2017; 7.5 Maintenance Fee Due 10/29/2021; 11.5 Maintenance Fee Due 10/29/2025.	Arctic Cat Inc.
Compact Steering Mechanism	Canada	2813156	Filed: 04/17/2013	Pending	Maintenance Fee Due 04/17/2016; Request for Examination Due 04/17/2018.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Coupler Axle	U.S.	12/881,349	Filed: 09/14/2010 Issued: 03/05/2013	8,388,457	Expires: 02/03/2031; 3.5 Maintenance Fee Due 09/05/2016; 7.5 Maintenance Fee Due 09/05/2020; 11.5 Maintenance Fee Due 09/05/2024.	Arctic Cat Inc.
Redacted	U.S.	13/948,007	Filed: 07/22/2013	Pending	Waiting on Action from U.S. Patent Office.	Arctic Cat Inc.
ECU Limiter	U.S.	13/460,588	Filed: 04/30/2012 Issue Date: 08/26/2014	8,818,570	Expires: 5/9/2032; 3.5 Year Maintenance Fee Due 2/26/2018; 7.5 Year Maintenance Fee Due 2/26/2022; 11.5 Year Maintenance Fee Due 2/26/2026.	Arctic Cat Inc.
Redacted	Canada	2814465	Filed: 04/29/2013	Pending	Redacted	Arctic Cat Inc.
Speed Limiter via Gauge Interface	U.S.	13/829,039	Filed: 03/14/2013	Pending	Waiting on Action from U.S. Patent Office.	Arctic Cat Inc.
Redacted	PCT	PCT/US14/22025	Filed: 03/07/2014	Pending	Redacted	Arctic Cat Inc.
Engine Configuration for a Vehicle	Sweden	000433487	Filed: 11/10/2005 Issue Date: 3/16/2006	000433487	Expires 11/10/2030. Maintenance Fee Due 11/10/2015.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Integrated Safety Net for Vehicle	U.S.	13/333,282	Filed: 12/21/2011 Issued: 06/18/2013	8,465,050	Expires: 12/21/2031; 3.5 Maintenance Fee Due 12/18/2016; 7.5 Maintenance Fee Due 12/18/2020; 11.5 Maintenance Fee Due 12/18/2024.	Arctic Cat Inc.
Redacted	Canada	Pending	Filed: 10/22/2012	Pending	Maintenance Fee Due 10/22/2015	Arctic Cat Inc.
Redacted	U.S.	13/829,129	Filed: 03/14/2013	Pending	Redacted	Arctic Cat Inc.
Redacted	PCT	PCT/US14/22051	Filed: 03/07/2014	Pending	Redacted	Arctic Cat Inc.
Redacted	U.S.	13/775,133	Filed: 02/23/2013	Pending	Waiting on Action from U.S. Patent Office.	Arctic Cat Inc.
Redacted	PCT	PCT/US14/17269	Filed: 2/20/2014	Pending	Redacted	Arctic Cat Inc.
Redacted	Taiwan	103105878	Filed: 2/21/2014	Pending	Redacted	Arctic Cat Inc.
Speedrack	U.S.	10/172,531	Filed: 06/13/2002 Issue Date: 5/16/2006	7,044,526	Expires 10/06/2022. 11.5 Maintenance Fee Due 11/16/2017.	Arctic Cat Inc.
Seat/Rack/Box (e.g., TRV)	U.S.	11/112,980	Filed: 04/22/2005 Issued: 12/21/2010	7,854,460	Expires 09/18/2025. 7.5 Maintenance Fee Due 06/21/2018. 11.5 Maintenance Fee Due 06/21/2022	Arctic Cat Inc.
Speedrack	Canada	2427706	Filed: 05/05/2003 Issue Date: 07/19/2011	2427706	Maintenance Fee Due 05/05/2015.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Seat/Rack/Box (e.g., TRV)	Canada	2541084	Filed: 03/27/2006	Pending	Annual Maintenance Fee Due 03/27/2016.	Arctic Cat Inc.
Multi-Link Rear Suspension for Vehicle	U.S.	13/454,954	Filed: 04/24/2012 Issue Date: 07/01/2015	8,764,039	Expires: 4/24/2032; 3.5 Year Maintenance Fee Due 1/1/2018; 7.5 Year Maintenance Fee Due 1/1/2022; 11.5 Year Maintenance Fee Due 1/1/2026.	Arctic Cat Inc.
Multi-Link Rear Suspension for Vehicle	Canada	2813589	Filed: 04/22/2013	Pending	Maintenance Fee Due 04/22/2015; Request for Examination Due 04/22/2018.	Arctic Cat Inc.
Redacted	U.S.	14/475,359	Filed: 09/02/2014	Pending	Redacted	Arctic Cat Inc.
Power Distribution Module for Personal Recreational Vehicle	U.S.	10/283,427	Filed: 10/29/2002 Issue Date: 7/4/2006	7,072,188	Expires 10/29/2022. 11.5 Maintenance Fee Due 01/04/2018.	Arctic Cat Inc.
Power Distribution Module for Personal Recreational Vehicle	U.S.	11/427,280	Filed: 06/28/2006 Issue Date: 9/2/2008	7,420,822	Expires 10/22/2022. 7.5 Maintenance Fee Due 3/2/2016; 11.5 Maintenance Fee Due 3/2/2020	Arctic Cat Inc.
Power Distribution Module for Personal Recreational Vehicle	U.S.	12/188,010	Filed: 08/07/2008 Issue Date: 7/7/2009	7,558,079	Expires 6/28/2026. 7.5 Maintenance Fee Due 1/7/2017; 11.5 Year Maintenance Fee Due 1/7/2021.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Recreational Vehicle Locking Differential	U.S.	10/434,518	Filed: 05/07/2003 Issue Date: 3/28/2005	7,018,317	Expires 05/07/2023. 11.5 Maintenance Fee Due 09/28/2017.	Arctic Cat Inc.
Recreational Vehicle Locking Differential	Europe	04445055.9	Filed: 05/07/2004 Issue Date: 03/31/2010	1475264	Expires on 5/7/2024	Arctic Cat Inc.
Recreational Vehicle Locking Differential	Europe-Germany	1475264	Issue Date: 3/31/2010	60 2004 026 244.7-08	Annual Maintenance Fee Due 05/31/2015.	Arctic Cat Inc.
Recreational Vehicle Locking Differential	Europe-France	1475264	Issue Date: 3/31/2010	1475264	Annual Maintenance Fee Due 05/31/2015.	Arctic Cat Inc.
Redacted	U.S.	14/245,901	Filed: 04/04/2014	Pending	Redacted	Arctic Cat Inc.
Redacted	Canada	Pending	Filed: 04/01/2015	Pending	Redacted	Arctic Cat Inc.
2-Up ATV	U.S.	10/415,704	Filed: 08/11/2003 Issue Date: 6/29/2010	7,743,864	Expires 10/28/2023. 7.5 Maintenance Fee Due 12/29/2017. 11.5 Maintenance Fee Due 12/29/2021	Arctic Cat Inc.
2-Up ATV	Canada	2,421,281	Filed: 07/31/2002 Issue Date: 7/15/2008	2,421,281	Expires on 7/31/2022; Annual Maintenance Fee Due 07/31/2015.	Arctic Cat Inc.
Textured All-Terrain Vehicle Fenders	U.S.	11/018,516	Filed: 12/20/2004 Issued Date: 3/2/2010	7,669,678	Expires 9/2/2027. 7.5 Maintenance Fee Due 9/2/2017; 11.5 Maintenance Fee Due 9/2/2021.	Arctic Cat Inc.

Patent Name	Country	U.S./Foreign Patent App. Serial No.	Date Filed/Issue Date	Patent/Reg. No.	Status	Owner
Redacted	U.S.	29/446,446	Filed: 02/23/2013	Pending	Waiting on Action from U.S. Patent Office.	Arctic Cat Inc.
Redacted	Canada	Pending	Filed: 08/21/2013	Pending	Waiting on Action from Canadian Patent Office.	Arctic Cat Inc.
Redacted	Europe	2294934	Filed: 08/22/2013 Issue Date: 11/12/2013	002294934-001	Maintenance Fee Due 08/22/2018	Arctic Cat Inc.
Redacted	U.S.	13/485,696	Filed: 05/31/2012	Pending	Waiting on Action from U.S. Patent Office.	Arctic Cat Inc.
Redacted	Canada	2817233	Filed: 05/29/2013	Pending	Maintenance Fee Due 05/29/2015; Request for Examination Due 05/29/2018.	Arctic Cat Inc.
Winch Switch	U.S.	10/172,301	Filed: 06/13/2002 Issue Date: 7/13/2004	6,762,377	Expires 06/13/2022. 11.5 Maintenance Fee Due 01/13/2016.	Arctic Cat Inc.
Controlled Thrust Steering System for WC	U.S.	10/439/568	Filed: 5/16/03 Issue Date: 9/21/04	6,793,545	Current	Arctic Cat Inc.

All redacted items deal with pending or in process but not yet filed patents.

2. As of 15 April 2015, Borrowers’ trademarks:

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
ARCTIC CAT®	Argentina	1609717	08/01/96	Arctic Cat Inc.
ARCTIC CAT®	Australia	672240	02/07/97	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
ARCTIC CAT®	Brazil	819100692	09/05/00	Arctic Cat Inc.
ARCTIC CAT®	Canada	174456	02/12/71	Arctic Cat Inc.
ARCTIC CAT®	Chile	919830	05/31/11	Arctic Cat Inc.
ARCTIC CAT®	China	5443533	06/24/06	Arctic Cat Inc.
ARCTIC CAT®	European Community	252965	09/01/98	Arctic Cat Inc.
ARCTIC CAT®	India		08/19/11	Arctic Cat Inc.
ARCTIC CAT®	Kazakhstan	36808	07/22/10	Arctic Cat Inc.
ARCTIC CAT®	Madrid Protocol (Norway, Russian Federation, Ukraine)	1044269	06/18/10	Arctic Cat Inc.
ARCTIC CAT®	New Zealand	253452	03/06/97	Arctic Cat Inc.
ARCTIC CAT®	Turkey	2010/32835	05/18/10	Arctic Cat Inc.
ARCTIC CAT®	USA	2178018	08/04/98	Arctic Cat Inc.
ARCTIC CAT®	Venezuela	P-196956	05/07/97	Arctic Cat Inc.
ARCTIC CAT®	Canada	549733	08/13/01	Arctic Cat Inc.
ARCTIC CAT®	USA	2293113	11/16/99	Arctic Cat Inc.
ARCTIC CIRCLETM	USA - Common Law	COMMON LAW	Date of first use - 2007	Arctic Cat Inc.
BEARCAT®	Canada	445426	07/11/95	Arctic Cat Inc.
BEARCAT®	European Community	274688	06/10/98	Arctic Cat Inc.
BLACK MAGICTM	Madrid Protocol (European Community)	1019137	10/17/09	Arctic Cat Inc.
BLACK MAGICTM	USA	3765245	03/23/10	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
Cat’s Head Logo	European Community	5256318	08/14/06	Arctic Cat Inc.
DRVTM	USA - Common Law	COMMON LAW	Date of First Use - 2/16/2006	Arctic Cat Inc.
DURAMATICTM	USA - Common Law	COMMON LAW	Date of First Use - 6/18/1999	Arctic Cat Inc.
DVXTM	USA - Common Law	COMMON LAW	Date of First Use - 07/2003	Arctic Cat Inc.
AIR CAT LogoTM	Canada	1366432	10/04/07	Arctic Cat Inc.
AIR CAT Logo®	Kazakhstan	36809	07/22/10	Arctic Cat Inc.
AIR CAT LogoTM	Kazakhstan	59297	08/24/12	Arctic Cat Inc.
AIR CAT Logo®	Madrid Protocol (European Community, Norway, Russian Federation, Turkey, Ukraine)	941 684	10/12/07	Arctic Cat Inc.
AIR CAT LogoTM	USA	4,208,167	09/18/12	Arctic Cat Inc.
HDXTM	USA - Common Law	COMMON LAW	Date of first use – 06/2010	Arctic Cat Inc.
MUDPROTM	USA	4021076	09/16/11	Arctic Cat Inc.
PROWLER®	Canada	404557	11/06/92	Arctic Cat Inc.
PROWLER®	European Community	4291341	02/16/05	Arctic Cat Inc.
PROWLERTM	USA	78/468,096	08/16/04	Arctic Cat Inc.
SBS 1000TM	USA - Common Law	COMMON LAW	Date of first use - 06/2001	Arctic Cat Inc.
SPEEDPOINTTM	USA - Common Law	COMMON LAW	Date of first use - 2006	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
SPEEDRACK®	Canada	688210	05/24/07	Arctic Cat Inc.
SPEEDRACK®	European Community	4032769	07/24/06	Arctic Cat Inc.
SPEEDRACK®	USA	3081671	04/18/06	Arctic Cat Inc.
TBXTM	USA - Common Law	COMMON LAW	Date of first use - 03/2001	Arctic Cat Inc.
THUNDERCATTM	USA	3915903	2/8/2011	Arctic Cat Inc.
TRV®	Canada	631714	02/01/05	Arctic Cat Inc.
TRV®	USA	2861288	07/06/04	Arctic Cat Inc.
WILDCATTM	USA	85/308,858	04/29/11	Arctic Cat Inc.
WILDCAT	USA	85/979,276	04/29/11	Arctic Cat Inc.
WORLD CLASS ALL TERRAIN VEHICLESTM	USA - Common Law	COMMON LAW	Date of first use - 1995	Arctic Cat Inc.
XTTM	USA - Common Law	COMMON LAW	Date of first use - 6/2005	Arctic Cat Inc.
XTXTM	USA - Common Law	COMMON LAW	Date of first use - 6/2007	Arctic Cat Inc.
XTZTM	USA - Common Law	COMMON LAW	Date of first use - 06/2008	Arctic Cat Inc.
ARCTIC CAT®	Canada	174456	02/12/71	Arctic Cat Inc.
ARCTIC CAT®	Canada	549733	08/13/01	Arctic Cat Inc.
ARCTIC CATTM	China	5443632	06/24/06	Arctic Cat Inc.
ARCTIC CATTM	China	5443540	06/24/06	Arctic Cat Inc.
ARCTIC CATTM	China	5443539	06/24/06	Arctic Cat Inc.
ARCTIC CATTM	China	5443538	06/24/06	Arctic Cat Inc.
ARCTIC CAT®	European Community	252965	09/01/98	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
ARCTIC CAT®	Finland	126273	05/12/93	Arctic Cat Inc.
ARCTIC CATTM	Kazakhstan	36808	07/22/10	Arctic Cat Inc.
ARCTIC CAT®	Norway	97973	01/06/77	Arctic Cat Inc.
ARCTIC CAT®	Sweden	251508	09/10/93	Arctic Cat Inc.
ARCTIC CAT®	Turkey	2008 18254	09/17/09	Arctic Cat Inc.
ARCTIC CAT®	USA	1647837	06/18/91	Arctic Cat Inc.
ARCTIC CAT®	USA	2293113	11/16/99	Arctic Cat Inc.
ARCTIC CIRCLETM	USA - Common Law	COMMON LAW	Date of first use - 2007	Arctic Cat Inc.
ARCTICWEAR®	Canada	320909	11/21/86	Arctic Cat Inc.
ARCTICWEAR®	Madrid Protocol	1044730	06/30/10	Arctic Cat Inc.
ARCTIC WEARTM	Kazakhstan	13207	07/22/10	Arctic Cat Inc.
ARCTICWEAR®	USA	1113183	02/13/79	Arctic Cat Inc.
A WHOLE DIFFERENT ANIMALTM	USA - Common Law	COMMON LAW	Date of first use - 09/06/1995	Arctic Cat Inc.
BEARCAT®	Canada	445426	07/11/95	Arctic Cat Inc.
BLACK MAGICTM	USA	85/207,420	12/29/10	Arctic Cat Inc.
BLACK MAGIC®	Canada	424434	03/04/94	Arctic Cat Inc.
BLACK MAGIC (STYLIZED)®	USA	1701656	07/21/92	Arctic Cat Inc.
CATMASTER®	Canada	432159	08/26/94	Arctic Cat Inc.
CATMASTER®	USA	1828332	03/29/94	Arctic Cat Inc.
EL TIGRE®	Canada	416555	09/10/93	Arctic Cat Inc.
AIR CAT LogoTM	Canada	1366432	10/04/07	Arctic Cat Inc.
AIR CAT Logo®	Kazakhstan	36809	07/22/10	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
AIR CAT LogoTM	Kazakhstan	59297	08/24/12	Arctic Cat Inc.
AIR CAT Logo®	Madrid Protocol	941 684	10/12/07	Arctic Cat Inc.
AIR CAT LogoTM	USA	4,208,167	10/03/07	Arctic Cat Inc.
DRIFT RACING	USA	85/899,316	04/09/13	Arctic Cat Inc.
GONE WHEELINTM	USA - Common Law	COMMON LAW	Date of first use - 06/2007	Arctic Cat Inc.
MISCELLANEOUS DESIGN (Cat’s Head)®	Canada	312714	03/28/86	Arctic Cat Inc.
MISCELLANEOUS DESIGN (Cat’s Head)®	European Community	5256318	08/14/06	Arctic Cat Inc.
MISCELLANEOUS DESIGN (Cat’s Head)®	USA	1789501	08/24/93	Arctic Cat Inc.
MUDPROTM	USA	77/917,274	01/21/10	Arctic Cat Inc.
PANTERA®	Canada	440026	03/03/95	Arctic Cat Inc.
PROWLER®	Canada	404557	11/06/92	Arctic Cat Inc.
RIDETM	USA - Common Law	COMMON LAW	Date of first use - 07/2002	Arctic Cat Inc.
SNO PRO®	Canada	396002	03/20/92	Arctic Cat Inc.
SNO PRO®	USA	1770179	05/11/93	Arctic Cat Inc.
SNO PRO®	USA	1777672	06/22/93	Arctic Cat Inc.
SNO-CROSS®	USA	1642895	04/30/91	Arctic Cat Inc.
SPEEDRACK®	Canada	688210	05/24/07	Arctic Cat Inc.
SPEEDRACK®	European Community	4032769	07/24/06	Arctic Cat Inc.
SPEEDRACK®	USA	3081671	04/18/06	Arctic Cat Inc.
TEAM ARCTIC®	Canada	440022	03/03/95	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
TEAM ARCTIC®	USA	1654873	08/27/91	Arctic Cat Inc.
THUNDERCAT®	European Community	330,126	08/21/06	Arctic Cat Inc.
THUNDERCATTM	USA	3915903	2/8/2011	Arctic Cat Inc.
WILDCAT®	Canada	384243	05/10/91	Arctic Cat Inc.
ZR®	USA	1803563	11/09/93	Arctic Cat Inc.
ZR®	Canada	422490	05/05/95	Arctic Cat Inc.
ARCTIC CAT®	Argentina	1609717	08/01/96	Arctic Cat Inc.
ARCTIC CAT®	Australia	672240	02/07/97	Arctic Cat Inc.
ARCTIC CAT®	Brazil	819100692	09/05/00	Arctic Cat Inc.
ARCTIC CAT®	Canada	174456	02/12/71	Arctic Cat Inc.
ARCTIC CAT®	Canada	549733	08/13/01	Arctic Cat Inc.
ARCTIC CAT®	European Community	252965	09/01/98	Arctic Cat Inc.
ARCTIC CAT®	Finland	126273	05/12/93	Arctic Cat Inc.
ARCTIC CAT®	France	1641564	01/31/91	Arctic Cat Inc.
ARCTIC CAT®	Japan	3182998	07/31/96	Arctic Cat Inc.
ARCTIC CATTM	Kazakhstan	36808	07/22/10	Arctic Cat Inc.
ARCTIC CAT®	New Zealand	253452	03/06/97	Arctic Cat Inc.
ARCTIC CAT®	Norway	97973	01/06/77	Arctic Cat Inc.
ARCTIC CAT®	USA	2178018	08/04/98	Arctic Cat Inc.
ARCTIC CATTM	Turkey	2010/32835	05/18/10	Arctic Cat Inc.
ARCTIC CAT®	USA	865633	03/04/69	Arctic Cat Inc.
ARCTIC CAT®	USA	2293113	11/16/99	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
ARCTIC CAT®	Venezuela	P-196956	05/07/97	Arctic Cat Inc.
BEARCAT®	Australia	672238	02/07/97	Arctic Cat Inc.
BEARCAT®	Canada	445426	07/11/95	Arctic Cat Inc.
BEARCAT®	European Community	274688	06/10/98	Arctic Cat Inc.
BEARCAT®	Finland	141862	12/20/95	Arctic Cat Inc.
BEARCAT®	USA	1982860	06/25/96	Arctic Cat Inc.
BLACK MAGIC (STYLIZED)®	USA	1701656	07/21/92	Arctic Cat Inc.
BLACK MAGIC®	Canada	424434	03/04/94	Arctic Cat Inc.
Cat’s Head Logo®	European Community	5256318	08/14/06	Arctic Cat Inc.
CHEETAH®	USA	1010674	05/13/75	Arctic Cat Inc.
COUGAR®	Canada	413602	06/18/93	Arctic Cat Inc.
COUGAR®	USA	1661623	10/22/91	Arctic Cat Inc.
EL TIGRE®	Canada	416555	09/10/93	Arctic Cat Inc.
EL TIGRE®	USA	1643544	05/07/91	Arctic Cat Inc.
EXT®	Canada	401342	08/14/92	Arctic Cat Inc.
EXT®	USA	1651429	07/23/91	Arctic Cat Inc.
FIRECAT®	Canada	614638	07/12/04	Arctic Cat Inc.
FIRECAT®	European Community	3013703	11/18/04	Arctic Cat Inc.
FIRECAT®	USA	2779647	11/04/03	Arctic Cat Inc.
AIR CAT LogoTM	Canada	1366432	10/04/07	Arctic Cat Inc.
AIR CAT Logo®	Kazakhstan	36809	07/22/10	Arctic Cat Inc.
AIR CAT LogoTM	Kazakhstan	59297	08/24/12	Arctic Cat Inc.
AIR CAT Logo®	Madrid Protocol	941 684	10/12/07	Arctic Cat Inc.

Mark	Country	Reg/Appl No.	Filing/ Issue Date	Owner
AIR CAT LogoTM	USA	4,208,167	09/18/12	Arctic Cat Inc.
JAG®	Canada	434873	10/28/94	Arctic Cat Inc.
JAG®	USA	1166432	08/25/81	Arctic Cat Inc.
KITTY CAT®	Canada	339037	04/08/88	Arctic Cat Inc.
LYNX®	Canada	231675	02/02/79	Arctic Cat Inc.
LYNX®	USA	1097348	07/25/78	Arctic Cat Inc.
MOUNTAIN CAT (STYLIZED)®	Canada	378910	01/25/91	Arctic Cat Inc.
PANTERA®	Canada	440026	03/03/95	Arctic Cat Inc.
PANTERA®	USA	1167171	09/01/81	Arctic Cat Inc.
PANTHER®	Canada	176503	06/04/71	Arctic Cat Inc.
PANTHER®	USA	890813	05/12/70	Arctic Cat Inc.
PROWLER®	Canada	404557	11/06/92	Arctic Cat Inc.
PROWLER®	USA	1548214	07/18/89	Arctic Cat Inc.
PUMA®	Canada	184776	08/11/72	Arctic Cat Inc.
SNO PRO®	European Community	1752328	02/11/02	Arctic Cat Inc.
SNO PRO®	USA	2514374	12/04/01	Arctic Cat Inc.
THUNDERCAT®	Canada	410832	04/09/93	Arctic Cat Inc.
THUNDERCAT®	USA	1762029	03/30/93	Arctic Cat Inc.
WILDCAT®	Canada	384243	05/10/91	Arctic Cat Inc.
Z®	Canada	436104	11/25/94	Arctic Cat Inc.
ZR®	Canada	422490	05/05/95	Arctic Cat Inc.
ZR®	USA	1803563	11/09/93	Arctic Cat Inc.

	USA	01/10/2012	4083865	MotorFist, LLC
	USA	07/26/2011	4003834	MotorFist, LLC
	USA	12/28/2010	3897819	MotorFist, LLC
	Canada	05/02/2012	TMA823192	MotorFist, LLC
MOTOR FIST	Registered [Designated countries: China, European Union, Japan and Norway. Mark refused in Russia*.]	03/07/2012	1120480	MotorFist, LLC
	Registered [Designated countries: China, European Union, Japan and Norway. Mark refused in Russia.]	12/07/2009	1024837	MotorFist, LLC

Domain names owned by Arctic Cat Inc.:

arctic-cat.com

arcticcat.com

arcticcatauction.com

arcticcatmiddleofnowhere. com

arcticmiddleofnowhere.com

visitmiddleofnowhere.com

visitthemiddleofnowhere.com

whatsnowmobilingsallabout.com

worldsfastestsnowmobile.com

worldsfastestsnowmobiles.com

driftracing.com

Domain names owned by MotorFist, LLC

MOTORFIST.COM

MOTORFIST.US

MOTOFIST.COM

MOTORFIST.INFO

MOTORFIST.MOBI

MOTORFIST.NET

MOTORFIST.ORG

MOTORFISTCANADA.COM

MTRFIST.COM

SNOMOBILINGISNOTACRIME.COM

3. Borrowers’ copyrights:

Copyright	Owner	Status in Copyright Office	Federal Registration No.	Registration Date
American national standard for four wheel, two person tandem all-terrain vehicles	Herman P. Christopherson; Arctic Cat, Inc.; Bombardier Recreational Products, Inc.	Active	TX0006104504	02/27/05
American national standard for four wheel, two person tandem all-terrain vehicles; standard / Created by Herman P. Christopherson	Herman P. Christopherson; Arctic Cat, Inc.; Bombardier Recreational Products, Inc.	Active	V3520 D372 P1	02/27/05
General warning label	Arctic Cat, Inc.; Bombardier Recreational Products, Inc.; Applied Safety and Ergonomics, Inc.	Active	VA0001299029	02/02/05
General warning label & 2 other titles; drawings	Applied Safety & Ergonomics, Inc.; Arctic Cat, Inc.; Bombardier Recreational Products, Inc.	Active	V3520D523P1	02/02/05
Passenger label	Arctic Cat, Inc.; Bombardier Recreational Products, Inc.; Applied Safety and Ergonomics, Inc.	Active	VA0001301470	02/02/05
Rack label	Arctic Cat, Inc.; Bombardier Recreational Products, Inc.	Active	VA0001302456	02/02/05

Copyright	Owner	Status in Copyright Office	Federal Registration No.	Registration Date
Rack label; drawing / Created by Arctic Cat, Inc.	Arctic Cat, Inc.; Bombardier Recreational Products, Inc.	Active	V3520 D524 P1	02/02/05

4. Borrowers’ and Subsidiaries’ licenses (other than routine business licenses, authorizing them to transact business in local jurisdictions):

Licensor	Description of License	Term of License	Royalties Payable
Raymond Schoenfelder	Technology license for drive train system for snowmobiles	Until terminated	$3.00 per unit; minimum of $20,000
Bombardier Recreational Products Inc. of Valcourt, Quebéc, Canada	Bombardier/ Suzuki/ Arctic Cat Cross License Agreement for the use of BRP’s 2 stroke engine electronic reverse technology.	Until the expiration of the relevant patents, unless sooner terminated.	None; in exchange for this license, Arctic granted a similar license for certain Arctic technology to Bombardier.
Aisin Seiki Co. Ltd.	License Agreement for the use of Aisin Seiki’s Engines	Until the expiration of the relevant patent	$1.00 per unit.

5. Intellectual Property Claims

Bombardier Recreational Products v. Arctic Cat Inc. and Arctic Cat Sales, Court File No. T-2025-11 (Canada)

Bombardier Recreational Products v. Arctic Cat Inc. and Arctic Cat Sales, Court File No. 1:11-cv-08897 (District of Minnesota)

SCHEDULE 9.1.14

ENVIRONMENTAL MATTERS

NONE.

SCHEDULE 9.1.15

RESTRICTIVE AGREEMENTS

NONE

SCHEDULE 9.1.16(a)

LITIGATION

1. Bombardier Recreational Products v. Arctic Cat Inc. and Arctic Cat Sales, Court File No. T-2025-11 (Canada)

2. Bombardier Recreational Products v. Arctic Cat Inc. and Arctic Cat Sales, Court File No. 1:11-cv-08897 (District of Minnesota)

3. Arctic Cat, Inc. et al v. Polaris Industries Inc. et al. Case No. 0:13-cv-03579-JRT-FLN (District of Minnesota)

SCHEDULE 9.1.16(b)

Commercial Tort Claims

1. Driveline Systems, LLC v. Arctic Cat Inc., Case No. 08-CV-50154 (N.D.Ill) (USA)

2. Arctic Cat Inc. v. Bombardier Recreational Products Inc., Civil File No. 12-CV-02692 (JRT-LIB) (D. Minn) (USA)

3. Arctic Cat Inc. v. Bombardier Recreational Products Inc., Court File No. T-2025-11 (Federal Court) (Canada)

4. Arctic Cat, Inc. et al v. Polaris Industries Inc. et al. Case No. 0:13-cv-03579-JRT-FLN (District of Minnesota)

SCHEDULE 9.1.18

PENSION PLAN DISCLOSURES

NONE

SCHEDULE 9.1.20

LABOR CONTRACTS

1. Borrowers and Subsidiary Obligors are party to the following collective bargaining agreements, management agreements and material consulting agreements:

NONE

SCHEDULE 10.2.1

PERMITTED CONTINGENT OBLIGATIONS

NONE

SCHEDULE 10.2.2

EXISTING LIENS

Lien on machinery and equipment located on real property in Stearns County, Minnesota in favor of the City of St. Cloud, Minnesota.

SCHEDULE 10.2.16

EXISTING AFFILIATE TRANSACTIONS

NONE

EX-10.38

Exhibit 10.38

CONSENT AND THIRD AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

This CONSENT AND THIRD AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”) is dated as of February 11, 2016, and is entered into by and among ARCTIC CAT INC., a Minnesota corporation (“Arctic Cat”), the Subsidiaries of Arctic Cat identified on the signature pages hereto (the “Borrowers” and each a “Borrower”), the financial institutions party to this Amendment from time to time as lenders (collectively, “Lenders”), and BANK OF AMERICA, N.A., a national banking association, as agent for the Lenders (“Agent”).

WHEREAS, the Borrowers, the Agent, and the Lenders have entered into that certain Amended and Restated Loan and Security Agreement dated as of November 8, 2013 (as amended, restated, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, the Borrowers have informed the Agent that one of the Borrowers, Arctic Cat Production Support LLC, a Minnesota limited liability company (“ACPS”), desires to enter into a “new markets tax credit financing” pursuant to which, among other things, ACPS will borrow up to $15,520,000 in the aggregate from Wells Fargo Community Development Enterprise Round 12 Subsidiary 6, LLC, a Delaware limited liability company (“Wells Fargo Sub-CDE”), and MMCDC New Markets Fund XLIX, LLC, a Delaware limited liability company (“MMCDC Sub-CDE” and, together with Wells Fargo Sub-CDE, the “Sub-CDE Lenders”), for the acquisition, construction, operation, and equipping of a paint, welding and assembly line located on the Real Estate commonly known as 601 Brooks Avenue South, Thief River Falls, Minnesota 56701;

WHEREAS, the Sub-CDE Lenders will make the loans described above to ACPS with the proceeds of qualified equity investments received from WF Paint & Assembly Investment Fund, LLC, a Delaware limited liability company, with WF Paint & Assembly Investment Fund, LLC making such qualified equity investment with the proceeds received from an equity investment of $5,304,000 from Wells Fargo Community Investment Holdings, LLC and a secured loan from Arctic Cat Sales Inc. in the original principal amount of $10,776,000 (which Arctic Cat Sales Inc. shall fund using the proceeds of a Revolver Loan funded one day prior to the date of this Amendment into deposit account #####-###### held at Wells Fargo Bank, National Association in the name of Arctic Cat Sales Inc.);

WHEREAS, the Borrowers have requested that the Agent and the Lenders (a) consent to the transfer of the Original NMTC Equipment (as defined pursuant to this Amendment) from Arctic Cat to ACPS in connection with the “new markets tax credit financing” described above, (b) consent to the amendment and restatement of the bylaws of ACPS as provided in this Amendment, and (c) agree to make certain amendments to the Loan Agreement in connection with such “new markets tax credit financing”; and

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in the Loan Agreement and this Amendment, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

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ARTICLE I

DEFINITIONS

Initially capitalized terms used but not otherwise defined in this Amendment have the respective meanings set forth in the Loan Agreement, as amended hereby.

ARTICLE II

CONSENT AND AMENDMENTS TO LOAN AGREEMENT

2.01 Limited Consent.

(a) The Borrowers have advised the Agent and the Lenders that the Original NMTC Equipment will be transferred from Arctic Cat to ACPS in connection with the NMTC Financing (as defined pursuant to this Amendment) and that ACPS plans to amend and restate its bylaws in connection with the NMTC Financing so that such bylaws are replaced in their entirety by an operating agreement in the form attached to this Amendment as Exhibit A (the “Bylaws Amendment and Restatement”). The Borrowers hereby acknowledge that, absent the consent set forth in this Section 2.01, (i) the transfer of the Original NMTC Equipment would not be permitted pursuant to Section 8.4.2 of the Loan Agreement and such transfer would be a Default under Section 11.1(d) of the Loan Agreement and (ii) the Bylaws Amendment and Restatement would not be permitted pursuant to Section 10.2.10 of the Loan Agreement and such amendment and restatement would be an Event of Default under Section 11.1(c) of the Loan Agreement. The Borrowers hereby request that the Agent and the Lenders consent to the transfer of the Original NMTC Equipment from Arctic Cat to ACPS in connection with the NMTC Financing and to the Bylaws Amendment and Restatement.

(b) Subject to the terms, conditions, and other restrictions set forth in this Amendment, each of the Agent and the Lenders hereby consents to (i) the transfer of the Original NMTC Equipment from Arctic Cat to ACPS in connection with the NMTC Financing, so long as ACPS reimburses Arctic Cat in cash and in an amount equal to $8,351,746.13 using the proceeds of the NMTC Loans and (ii) the Bylaws Amendment and Restatement solely as described in clause (a) above, so long as such Bylaws Amendment and Restatement does not cause the execution, delivery and performance of the Loan Documents by ACPS to contravene its Organic Documents.

(c) The consent set forth in this Section 2.01 does not affect the continued legality, validity, and binding effect of the Loan Agreement or the other Loan Documents. The Loan Agreement and the other Loan Documents continue to be fully enforceable in each case, except as expressly provided in this Amendment. The consent set forth in this Section 2.01 is specifically limited in time and scope to the transfer of the Original NMTC Equipment from Arctic Cat to ACPS in connection with the NMTC Financing and to the Bylaws Amendment and Restatement, in each case solely as described in this Amendment, and does not extend or apply to any other event, occurrence, or circumstance in existence as of the date of this Amendment or arising after the date of this Amendment. In addition, the consent set forth in this Section 2.01 does not constitute or establish (and is not to be deemed to constitute or establish) a custom or a practice on the part of the Agent or any Lender and does not prejudice any right of the Agent or any Lender in respect of any other disposition of Property or any other amendment, modification or other change to any Organic Document of any Obligor or Subsidiary of an Obligor.

2.02 Amendments to Loan Agreement.

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(a) Existing Definitions. The definitions of “Defaulting Lender”, “Other Agreement” and “Permitted Contingent Obligations” set forth in Section 1.1 of the Loan Agreement are each hereby amended and restated to read in its entirety as follows:

Defaulting Lender: any Lender that (a) has failed to comply with its funding obligations hereunder, and such failure is not cured within two Business Days; (b) has notified Agent or any Borrower that such Lender does not intend to comply with its funding obligations hereunder or under any other credit facility, or has made a public statement to that effect; (c) has failed, within three Business Days following request by Agent or any Borrower, to confirm in a manner satisfactory to Agent and Borrowers that such Lender will comply with its funding obligations hereunder; or (d) has, or has a direct or indirect parent company that has, become the subject of an Insolvency Proceeding (including reorganization, liquidation, or appointment of a receiver, custodian, administrator or similar Person by the Federal Deposit Insurance Corporation or any other regulatory authority) or a Bail-In Action; provided, however, that a Lender shall not be a Defaulting Lender solely by virtue of a Governmental Authority’s ownership of an equity interest in such Lender or parent company unless the ownership provides immunity for such Lender from jurisdiction of courts within the United States or from enforcement of judgments or writs of attachment on its assets, or permits such Lender or Governmental Authority to repudiate or otherwise to reject such Lender’s agreements.

Other Agreement: the NMTC Intercreditor Agreement and each LC Document, fee letter, Lien Waiver, Real Estate Related Document, Borrowing Base Certificate, Compliance Certificate, Borrower Materials, or other note, document, instrument or agreement (other than this Agreement or a Security Document) now or hereafter delivered by an Obligor or other Person to Agent or a Lender in connection with any transactions relating hereto.

Permitted Contingent Obligations: Contingent Obligations (a) arising from endorsements of Payment Items for collection or deposit in the Ordinary Course of Business; (b) existing on the Closing Date and identified on Schedule 10.2.1, and any extension or renewal thereof that does not increase the amount of such Contingent Obligation when extended or renewed; (c) incurred in the Ordinary Course of Business with respect to surety, appeal or performance bonds, or other similar obligations; (d) arising from customary indemnification obligations in favor of purchasers in connection with dispositions of Equipment permitted hereunder; (e) arising under the Loan Documents; (f) in an aggregate amount of $1,000,000 or less at any time; (g) of Arctic Cat under that certain Repayment Guaranty, made as of the NMTC Closing Date by Arctic Cat to and for the benefit of the NMTC Lenders, as in effect on the NMTC Closing Date, but only so long as such guaranty is unsecured and the Debt guarantied thereby is permitted pursuant to Section 10.2.1(j); (h) of Arctic Cat under that certain Investment Fund Put and Call Agreement, dated as of the NMTC Closing Date, by and between Wells Fargo Community Investment Holdings, LLC, a Delaware limited liability company, and Arctic Cat, as in effect on the NMTC Closing Date, but only so long as the obligations of Arctic Cat thereunder are unsecured and the NMTC Loans are permitted pursuant to Section 10.2.1(j); and (i) of Arctic Cat and ACPS under that certain Indemnity Agreement, dated as of the NMTC Closing Date, made by Arctic Cat and ACPS for the benefit of Wells Fargo Community Investment Holdings, LLC, as in effect on the NMTC Closing Date, but only so long as the obligations of Arctic Cat thereunder are unsecured and the NMTC Loans are permitted pursuant to Section 10.2.1(j).

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(b) New Definitions. The following definitions are hereby inserted in Section 1.1 of the Loan Agreement in appropriate alphabetical order:

ACPS: Arctic Cat Production Support LLC, a Minnesota limited liability company.

Arctic Cat Sales: Arctic Cat Sales Inc., a Minnesota corporation.

Bail-In Action: the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

Bail-In Legislation: with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

EEA Financial Institution: means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

EEA Member Country: any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

EEA Resolution Authority: any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

EU Bail-In Legislation Schedule: the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

Fund Loan Documents: (a) that certain Fund Loan Agreement, dated as of the NMTC Closing Date, by and between WF Paint & Assembly and Arctic Cat Sales, as amended, restated, supplemented, or otherwise modified from time to time, (b) that certain Promissory Note, dated as of the NMTC Closing Date, made by WF Paint & Assembly in favor of Arctic Cat Sales, in the original principal amount of $10,776,000, as amended, restated, replaced, supplemented, or otherwise modified from time to time, (c) that certain Security and Pledge Agreement, dated as of the NMTC Closing Date, by and between WF Paint & Assembly and Arctic Cat Sales, as amended, restated, supplemented, or otherwise modified from time to time, and (d) any and all other documents, agreements or understandings that evidence, secure, provide for the guaranty of, or otherwise govern the terms and conditions of the Debt evidenced by the documents referred to in clauses (a) and (b), each as amended, restated, supplemented, or otherwise modified from time to time.

MMCDC Sub-CDE: MMCDC New Markets Fund XLIX, LLC, a Delaware limited liability company, together with its successors and assigns under the NMTC Financing Documents.

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NMTC Closing Date: February 11, 2016.

NMTC Disbursement Account: the deposit account number ####-###### held at Wells Fargo Bank, National Association, in the name of ACPS.

NMTC Equipment: the Original NMTC Equipment and Equipment owned by ACPS and purchased by ACPS entirely with the proceeds of the NMTC Loans from time to time in accordance with the NMTC Financing Documents and this Agreement.

NMTC Facility: means the NMTC Equipment and that certain paint facility located on the Real Estate commonly known as 601 Brooks Avenue South, Thief River Falls, Minnesota 56701 and consisting of approximately 234,375 square feet of space and leased from Arctic Cat by ACPS pursuant to that certain lease agreement dated as of January 1, 2003.

NMTC Financing: collectively, (a) the acquisition, construction, equipping and operation of the NMTC Equipment in the NMTC Facility by ACPS, using the proceeds of the NMTC Loans, (b) the NMTC Investment, and (c) interest payments and scheduled amortization payments by ACPS on the NMTC Loans.

NMTC Financing Documents: the NMTC Loan Agreement, the Fund Loan Documents, and any other agreement or instrument to which any Obligor is party, bound, or beneficiary in connection with the NMTC Financing.

NMTC Intercreditor Agreement: that certain Intercreditor Agreement, dated as of the NMTC Closing Date, by and among the Agent, Wells Fargo Sub-CDE, and MMCDC Sub-CDE, and acknowledged and agreed to by the Obligors, as amended, restated, supplemented, or otherwise modified from time to time in accordance with its terms.

NMTC Investment: the Investment in the form of a secured loan from Arctic Cat Sales to WF Paint & Assembly, in a principal amount not to exceed $10,776,000.

NMTC Loan Agreement: that certain Loan Agreement, dated as of the NMTC Closing Date, by and among ACPS, the Wells Fargo Sub-CDE, and the MMCDC Sub-CDE, as amended, restated, supplemented, or otherwise modified from time to time.

NMTC Loans: collectively, the loans to ACPS to provide funding for the financing of the NMTC Facility from (a) Wells Fargo Sub-CDE in an aggregate principal amount not to exceed $4,000,000 and (b) MMCDC Sub-CDE in a principal amount not to exceed $11,520,000.

Original NMTC Equipment: the Equipment acquired by ACPS in connection with the NMTC Financing and described on Exhibit C.

WF Paint & Assembly: means WF Paint & Assembly Investment Fund, LLC, a Delaware limited liability company, together with its successor and assigns under the NMTC Financing Documents.

Wells Fargo Holdings: means Wells Fargo Community Investment Holdings, LLC, a Delaware limited liability company, together with its successor and assigns under the NMTC Financing Documents.

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Wells Fargo Sub-CDE means Wells Fargo Community Development Enterprise Round 12 Subsidiary 6, LLC, a Delaware limited liability company, together with its successors and assigns under the NMTC Financing Documents.

Write-Down and Conversion Powers: means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

(c) Use of Proceeds. The period at the end of Section 2.1.3 of the Loan Agreement is hereby replaced with the following:

“; and (g) to make the NMTC Investment permitted by Section 10.2.6.”

(d) Certain After-Acquired Collateral. The first sentence of Section 7.4.2 of the Loan Agreement is hereby amended and restated to read in its entirety as follows: “Borrowers shall promptly notify Agent in writing if, after the Closing Date, any Borrower obtains any interest in any Collateral consisting of Deposit Accounts, Chattel Paper, Documents, Instruments, Intellectual Property, Investment Property or Letter-of-Credit Rights and, upon Agent’s request, shall promptly take such actions as Agent deems appropriate to effect Agent’s duly perfected, first priority Lien upon such Collateral (provided that Agent’s Lien on the NMTC Disbursement Account may be second in priority to the Lien securing the NMTC Loans, so long as the NMTC Intercreditor Agreement is in full force and effect and any of the NMTC Loans are outstanding), including obtaining any appropriate possession, control agreement or Lien Waiver.”

(e) Collateral Assignment of Fund Loan Documents. A new Section 7.4.3 is hereby added to the Loan Agreement to read in its entirety as follows:

“7.4.3 Collateral Assignment of Fund Loan Documents.

(a) Without limiting the generality of the grant of security interest set forth in this Agreement or the other Loan Documents, including without limitation that set forth in Section 7.1 of this Agreement, each Obligor hereby assigns, transfers, and sets over unto Agent, for the benefit of the Secured Parties, as security for the prompt payment and performance of all Obligations, all of such Obligor’s right, title, and interest in and under the Fund Loan Documents, including, without limitation, the right to exercise any and all of such Obligor’s existing and future rights, remedies, claims, and causes of action arising under the Fund Loan Documents, including, without limitation, (i) any and all claims related to any breach of any representations, warranties, or covenants made by or on behalf of WF Paint & Assembly or/or any and all other Persons under the Fund Loan Documents, (ii) all of each Obligor’s rights to indemnification under the Fund Loan Documents by WF Paint & Assembly and/or any and all other Persons, and (iii) all rights to enforce any and all covenants contained in the Fund Loan Documents against WF Paint & Assembly and/or any and all other Persons.

(b) Nothing contained in this Agreement constitutes an assumption by Agent, in whole or in part, of any obligation of any Obligor under any Fund Loan Document. Agent will not be liable or responsible in any manner whatsoever to any Obligor, WF Paint & Assembly or any other Person for any matter or thing connected with any aspect

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of any of the Fund Loan Documents, including, without limitation, performance by any Obligor thereunder. Upon the occurrence and during the continuance of an Event of Default, Agent may, without further notice to or consent of any Obligor or any other Person, exercise all rights and remedies of each Obligor under the Fund Loan Documents and notify WF Paint & Assembly or any other Person of Agent’s rights and interests hereunder and thereunder.

(c) Each Obligor hereby covenants, represents, and warrants to Agent that (i) such Obligor has full right to assign its interest in the Fund Loan Documents and any other documents, agreements or understandings executed in connection therewith and all rights and benefits thereunder, (ii) the Fund Loan Documents are in full force and effect and not subject to any defenses, setoffs, or counterclaims whatsoever, (iii) no other assignment of any interest in any of the Fund Loan Documents has been made by any Obligor, (iv) without the prior written consent of Agent, such Obligor shall not do any of the following: (A) cancel, surrender, or terminate any Fund Loan Document, (B) change, alter, or modify any Fund Loan Document or (C) consent to the release of any party liable under any Fund Loan Document; (v) such Obligor shall notify Agent in writing of the occurrence of any material default by any Person, including an Obligor, under the terms of any of the Fund Loan Documents; and (vi) such Obligor shall notify Agent in writing of the exercise by such Obligor of any of its material rights or remedies under any Fund Loan Document.”

(f) Deposit Accounts. The third sentence of Section 8.5 of the Loan Agreement is hereby amended and restated to read in its entirety as follows: “A Borrower shall be the sole account holder of each Deposit Account and shall not allow any other Person (other than Agent and, with respect to the NMTC Disbursement Account so long as the NMTC Intercreditor Agreement is in full force and effect and any of the NMTC Loans are outstanding, Wells Fargo Sub-CDE and MMCDC Sub-CDE) to have control over a Deposit Account or any Property deposited therein.”

(g) EEA Financial Institution. A new Section 9.1.25 is hereby added to the Loan Agreement to read in its entirety as follows:

“9.1.25 EEA Financial Institution. No Obligor is an EEA Financial Institution.”

(h) NMTC Financing. A new Section 9.1.26 is hereby added to the Loan Agreement to read in its entirety as follows:

“9.1.26 NMTC Financing. No Obligor or Subsidiary is party to, bound by, or the beneficiary of any NMTC Financing Document and no NMTC Financing Document has been modified or otherwise amended, other than pursuant to documents of which final executed copies have been provided by the Obligors to the Agent.”

(i) Financial and Other Information.

(i) Clauses (a) and (b) of Section 10.1.2 of the Loan Agreement are hereby amended and restated to read in their entirety as follows:

“(a) as soon as available, and in any event within 90 days after the close of each Fiscal Year, balance sheets as of the end of such Fiscal Year and the related statements of income, cash flow and shareholders equity for such Fiscal Year, on consolidated and (upon request by Agent) consolidating bases for Borrowers and Subsidiaries (together

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with any separate balance sheet prepared with respect to ACPS as of the end of such Fiscal Year, and any related statements of income, cash flows, and shareholders equity), which consolidated statements shall be audited and certified (without qualification) by a firm of independent certified public accountants of recognized standing selected by Borrowers and acceptable to Agent, and shall set forth in comparative form corresponding figures for the preceding Fiscal Year and other information acceptable to Agent (provided, however, that any financial statements required to be delivered pursuant to this Section 10.1.2(a) (to the extent such statements are included in materials otherwise filed with the Securities and Exchange Commission) may be delivered electronically and, if so delivered, shall be deemed to have been delivered on the date on which the Borrowers post such documents on www.sec.gov, or provide a link thereto on the Borrowers’ website at www.arcticcatinc.com, so long as, concurrent therewith, the Borrowers provide each Lender and Agent with notice alerting them to such posting, together with any additional materials required to be delivered therewith, including but not limited to any Compliance Certificate required to be provided at such time; provided that the Borrowers shall deliver paper copies of such documents to any Lender that requests the Borrowers to deliver such paper copies);

(b) as soon as available, and in any event within 30 days after the end of each month (but within 60 days after the last month in a Fiscal Year), unaudited balance sheets as of the end of such month and the related statements of income and cash flow for such month and for the portion of the Fiscal Year then elapsed, on consolidated and (upon request by Agent) consolidating bases for Borrowers and Subsidiaries (together with any separate balance sheet prepared with respect to ACPS as of the end of such month, and any related statements of income and cash flow), setting forth in comparative form corresponding figures for the preceding Fiscal Year and certified by the chief financial officer of Borrower Agent as prepared in accordance with GAAP and fairly presenting the financial position and results of operations for such month and period, subject to normal year-end adjustments and the absence of footnotes;”

(ii) Clause (k) of Section 10.1.2 of the Loan Agreement is hereby relettered as clause (m) and the following clauses are hereby inserted in appropriate alphabetical order in Section 10.1.2 of the Loan Agreement:

“(k) promptly after the same are available and delivered to the required recipients thereof, copies of each report or financial statement delivered to any Obligor or Subsidiary, or by any Obligor or Subsidiary to WF Paint & Assembly, Wells Fargo Holdings, Wells Fargo Sub-CDE, MMCDC Sub-CDE and/or any other Person, in connection with the NMTC Financing;

(l) promptly upon execution thereof, a copy of each NMTC Financing Document and each amendment to or modification of an NMTC Financing Document, in each case together with all items delivered to any Obligor or any Subsidiary, or by any Obligor or Subsidiary to WF Paint & Assembly, Wells Fargo Holdings, Wells Fargo Sub-CDE, MMCDC Sub-CDE and/or any other Person, in connection therewith; and”

(j) Notices. Clause (c) of Section 10.1.3 of the Loan Agreement is hereby amended and restated to read in its entirety as follows:

“(c) any default under or termination of a Material Contract or an NMTC Financing Document;”

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(k) Bank Accounts. Section 10.1.10 of the Loan Agreement is hereby amended and restated to read in its entirety as follows:

“10.1.10 Bank Accounts. Maintain all operating, administrative, cash management, funds transfer, collection or lockbox activity and other deposit accounts and all other bank products (including funds transfer, information reporting services and other treasury management services) for the conduct of the Borrowers’ business with Bank of America; provided, however, that (a) Borrowers may use Bank Products provided by JPMorgan Chase Bank, N.A. to Borrowers and (b) the following bank accounts may be maintained with Wells Fargo Bank, so long as such accounts are used solely for the purposes indicated in this clause (b): general account (operating) ########, self-insured workers’ compensation account ########, general account ########, lockbox account ########, accounts payable account ########, general account (for corporate credit cards) ########, operating account ########, operating account ######## and, so long as the NMTC Intercreditor Agreement is in full force and effect and any of the NMTC Loans remain outstanding, the NMTC Disbursement Account. Borrowers shall cause the NMTC Disbursement Account to be closed on or prior to August 30, 2017.”

(l) Post-Closing Obligations. The period at the end of Section 10.1.12 of the Loan Agreement is hereby replaced with a semicolon, and the following clauses are hereby inserted at the end of Section 10.1.12:

“(iv) on or before February 11, 2016, Agent shall have received (A) a bill of sale evidencing that ACPS has paid Arctic Cat an amount equal to $8,351,746.13 for the Original NMTC Equipment and (B) evidence that such payment was made in cash using the proceeds of the NMTC Loans;

(v) on or before February 12, 2016, as such deadline may be extended in writing by Agent from time to time, Agent shall have received a duly executed undated original endorsement in blank with respect to each promissory note issued to Arctic Cat Sales Inc. by WF Paint & Assembly Investment Fund, LLC, a Delaware limited liability company, in connection with the NMTC Investment; and

(vi) on or before March 11, 2016, (A) a Deposit Account Control Agreement by and among Wells Fargo Bank, National Association, the Agent, Wells Fargo Sub-CDE, MMCDC Sub-CDE, and ACPS concerning the NMTC Disbursement Account, (B) a Deposit Account Control Agreement by and among Wells Fargo Bank, National Association, the Agent, and ACPS concerning ACPS’s operating account number 4129-385860 and (C) a Deposit Account Control Agreement by and among Wells Fargo Bank, National Association, the Agent, and Arctic Cat Sales concerning Arctic Cat Sales’ operating account number ########.”

(m) Permitted Debt. The first parenthetical in clause (d) of Section 10.2.1 of the Loan Agreement is hereby amended and restated to read in its entirety as follows: “(other than the Obligations, Subordinated Debt, Permitted Purchase Money Debt, and Debt permitted by clause (j) of this Section 10.2.1)”. Clause (j) of Section 10.2.1 of the Loan Agreement is hereby relettered as clause (k) and the following clause is hereby inserted in appropriate alphabetical order in Section 10.2.1 of the Loan Agreement:

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“(j) Debt of ACPS in connection with the NMTC Financing in an aggregate principal amount not to exceed $15,520,000, so long as such Debt remains subject to the NMTC Intercreditor Agreement; and”

(n) Permitted Liens. The period at the end of Section 10.2.2(k) of the Loan Agreement is hereby replaced with a semicolon and the following new clause is hereby added to the end of such Section 10.2.2:

“(l) Liens on the NMTC Equipment and the NMTC Disbursement Account securing the Debt permitted by Section 10.2.1(j), which Liens may have priority over Agent’s Liens so long as such Liens securing such Debt permitted by Section 10.2.1(j) are subject to the NMTC Intercreditor Agreement.”

(o) Disposition of Assets. The period at the end of Section 10.2.5 of the Loan Agreement is hereby deleted and replaced by the following:

“; provided that any transfer of Property from any Obligor to ACPS must be for cash and for the fair market value of the transferred Property.”

(p) Loans. Section 10.2.6 of the Loan Agreement is hereby amended and restated to read in its entirety as follows:

“10.2.6 Loans.

Make any loans or other advances of money to any Person, except (a) advances to an officer or employee for salary, travel expenses, commissions and similar items in the Ordinary Course of Business; (b) prepaid expenses and extensions of trade credit made in the Ordinary Course of Business; (c) deposits with financial institutions permitted hereunder; (d) as long as no Default or Event of Default exists, intercompany loans by a Borrower to another Borrower (other than to ACPS); (e) the NMTC Investment; and (f) the reimbursement of the transferring Obligor by ACPS, using the proceeds of the NMTC Loans, in cash in an amount equal to the fair market value of the NMTC Equipment transferred to ACPS by such transferring Obligor.”

(q) Restrictions on Payment of Certain Debt. Section 10.2.7 of the Loan Agreement is hereby amended and restated to read in its entirety as follows:

“10.2.7 Restrictions on Payment of Certain Debt.

Make any payment (whether voluntary or mandatory, or a prepayment, redemption, retirement, defeasance or acquisition) with respect to any (a) Subordinated Debt or Debt permitted under Section 10.2.1(j), in each case except regularly scheduled payments of principal, interest and fees, but only to the extent permitted under any intercreditor or subordination agreement relating to such Debt (and, with respect to Subordinated Debt, a Senior Officer of Borrower Agent shall certify to Agent, not less than five Business Days prior to the date of payment, that all conditions under such agreement have been satisfied); or (b) Borrowed Money (other than the Obligations, Subordinated Debt, and Debt permitted under Section 10.2.1(j)) prior to its due date under the agreements evidencing such Debt as in effect on the Closing Date (or as amended thereafter with the consent of Agent).”

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(r) Fundamental Changes. The following parenthetical is hereby inserted immediately prior to the semicolon appearing as the end of Section 10.2.8(a) of the Loan Agreement: “(other than mergers or consolidations of a wholly-owned Subsidiary with or into ACPS)”.

(s) Affiliate Transactions. The following parenthetical is hereby inserted immediately prior to the semicolon appearing as the end of Section 10.2.16(c) of the Loan Agreement: “(subject to Section 10.2.5)”.

(t) Amendments to Subordinated Debt, Dealer Finance Agreements, and NMTC Financing Documents. Section 10.2.18 of the Loan Agreement is hereby amended and restated to read in its entirety as follows:

“10.2.18 Amendments to Subordinated Debt, Dealer Finance Agreements, and NMTC Financing Documents.

Amend, supplement or otherwise modify any NMTC Financing Document or any document, instrument or agreement relating to any Subordinated Debt or to the Dealer Finance Agreements, if such modification (a) increases the principal balance of such Debt, or increases any required payment of principal or interest; (b) accelerates the date on which any installment of principal or any interest is due, or adds any additional redemption, put or prepayment provisions; (c) shortens the final maturity date or otherwise accelerates amortization; (d) increases the interest rate; (e) increases or adds any fees or charges; (f) modifies any covenant in a manner or adds any representation, covenant or default that is more onerous or restrictive in any material respect for any Borrower or Subsidiary, or that is otherwise materially adverse to any Borrower, any Subsidiary or Lenders; (g) in the case of Subordinated Debt, results in the Obligations and/or the Liens securing the Obligations not being fully benefited by the subordination and/or intercreditor provisions applicable thereto; or (h) in the case of a NMTC Financing Document, results in the Obligations and/or the Liens securing the Obligations not being fully benefitted by the NMTC Intercreditor Agreement.”

(u) NMTC Disbursement Account. A new Section 10.2.20 is hereby added to the Loan Agreement to read in its entirety as follows:

“10.2.20 NMTC Disbursement Account. Permit any funds to be deposited into or otherwise held in the NMTC Disbursement Account at any time, other than the proceeds of the NMTC Loans, or permit any funds to be removed from the NMTC Disbursement Account, other than funds used by ACPS to purchase NMTC Equipment and funds foreclosed upon by the NMTC Lenders and/or the Agent in accordance with the NMTC Financing Documents and the Loan Documents.”

(v) Events of Default. The period at the end of Section 11.1(m) of the Loan Agreement is hereby replaced with a semicolon and the word “and”, and the following new clause (n) is hereby added to Section 11.1 of the Loan Agreement in appropriate alphabetical order:

“(n) (i) the occurrence of a default or event of default, however defined, under any NMTC Financing Document, (ii) the occurrence of an event that has resulted in, or may reasonably be expected to result in, a recapture (as defined in Section 45D(g) of the Tax Code (as defined in the NMTC Loan Agreement) and Treasury Regulation Section 1.45D-1(e)) of the New Markets Tax Credits (as defined in the NMTC Loan Agreement), or (iii) the exercise of any put or call right pursuant to that certain

11

Investment Fund Put and Call Agreement, dated as of the NMTC Closing Date, by and between Wells Fargo Community Investment Holdings, LLC, a Delaware limited liability company, and Arctic Cat, as amended, restated, supplemented, or otherwise modified from time to time.”

(w) Acknowledgement and Consent to Bail-In of EEA Financial Institutions. A new Section 14.18 is hereby added to the Loan Agreement to read in its entirety as follows:

“14.18 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any Lender that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any Lender that is an EEA Financial Institution; and

(b) the effects of any Bail-in Action on any such liability, including, if applicable: (i) a reduction in full or in part or cancellation of any such liability; (ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or (iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.”

(x) Original NMTC Equipment. A new Exhibit C is hereby appended to the Loan Agreement to read in its entirety as set forth on Exhibit B attached hereto.

(y) Deposit Accounts. Schedule 8.5 of the Loan Agreement is hereby amended and restated to read in its entirety as set forth on Exhibit C attached hereto.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Obligor hereby represents and warrants to each Lender and the Agent, as of the Third Amendment Effective Date (as such term is defined in Section 4.01 below), as follows:

3.01 Representations and Warranties. After giving effect to this Amendment, the representations and warranties set forth in the Loan Agreement as modified by this Amendment, including without limitation Section 9 thereof, and in each other Loan Document are true and correct in all material respects on and as of the date hereof and on and as of the Third Amendment Effective Date with the same effect as if made on and as of the date hereof or the Third Amendment Effective Date, as the case may be, except to the extent such representations and warranties expressly relate solely to an earlier date.

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3.02 No Defaults. Each of the Obligors is in compliance with all terms and conditions of the Loan Agreement, as modified by this Amendment, and the other Loan Documents on its part to be observed and performed and no Default or Event of Default has occurred and is continuing.

3.03 Authority and Pending Actions. The execution, delivery, and performance by each Obligor of this Amendment has been duly authorized by each such Obligor (as applicable) and there is no action pending or any judgment, order, or decree in effect which is likely to restrain, prevent, or impose materially adverse conditions upon the performance by any Obligor of its obligations under the Loan Agreement, as modified by this Amendment, or the other Loan Documents.

3.04 Enforceability. This Amendment, and the Loan Agreement as modified by this Amendment, constitutes the legal, valid, and binding obligation of each Obligor, enforceable against each such Obligor in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization, or other similar laws affecting the enforcement of creditors’ rights or by the effect of general equitable principles.

3.05 Breach; Conflicts. The execution, delivery, and performance by each Obligor of this Amendment do not and will not conflict with, or constitute a violation or breach of, or result in the imposition of any Lien upon the property of such Obligor, by reason of the terms of (i) any contract, mortgage, lease, agreement, indenture, or instrument to which such Obligor is a party or which is binding upon it, (ii) any Applicable Law with respect to such Obligor, or (iii) any Organic Document of such Obligor.

ARTICLE IV

CONDITIONS PRECEDENT AND FURTHER ACTIONS

4.01 Conditions Precedent. The consents and amendments contained in Article II shall not be effective or binding upon the Agent or the Lenders until each of the following conditions precedent has been satisfied in form and substance satisfactory to the Agent (the first date upon which each such condition has been satisfied being herein called the “Third Amendment Effective Date”):

(a) the representations and warranties contained herein and in the Loan Agreement, as modified by this Amendment, shall be true and correct in all material respects as of the date hereof (without duplication of any materiality qualifier contained therein), as if made on such date, except for such representations and warranties limited by their terms to a specific date (in which case such representations and warranties shall be true and correct as of such specific date in such respect);

(b) Agent shall have received duly executed counterparts of (i) this Amendment, which, when taken together, bear the authorized signatures of the Borrowers, the Agent, and the Lenders; and (ii) the NMTC Intercreditor Agreement, which, when taken together, bear the authorized signatures of the parties thereto;

(c) Agent shall have received a copy of any tax opinion delivered with respect to the NMTC Financing (which need not be addressed to Agent or any Lender);

(d) Agent shall have received certified copies of the NMTC Financing Documents;

(e) Agent shall have received a final sources and uses analysis with respect to the NMTC Financing;

13

(f) Agent shall have received the original promissory note(s) issued to Arctic Cat Sales Inc. by WF Paint & Assembly Investment Fund, LLC, a Delaware limited liability company, in connection with the NMTC Investment;

(g) Agent shall have received a certificate of a duly authorized officer of ACPS, certifying that attached copies of such Obligor’s Organic Documents, modified as described in Section 2.01 of this Amendment, are true and complete, and in full force and effect, without modification except as shown. Agent may conclusively rely on this certificate until it is otherwise notified by ACPS in writing.

(h) the Obligors shall have paid to the Agent all fees, costs, and expenses owed to and/or incurred by the Agent and the Lenders in connection with this Amendment;

(i) Agent shall have received such other documents, legal opinions, instruments, and certificates relating to this Amendment as it shall reasonably request and such other documents, legal opinions, instruments, and certificates that shall be satisfactory in form and substance to the Agent and the Lenders. All corporate proceedings taken or to be taken in connection with this Amendment and documents incidental thereto whether or not referred to herein shall be reasonably satisfactory in form and substance to the Agent and the Lenders; and

(j) all proceedings taken in connection with the transactions contemplated by this Amendment and all documentation and other legal matters incident thereto shall be satisfactory to the Agent in its sole and absolute discretion.

4.02 Further Actions. Each of the parties to this Amendment agrees that at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Amendment.

ARTICLE V

COSTS AND EXPENSES

Without limiting the terms and conditions of the Loan Documents, the Obligors jointly and severally agree to pay on demand: (i) all reasonable costs and expenses incurred by the Agent in connection with the preparation, negotiation, and execution of this Amendment and the other Loan Documents executed pursuant to this Amendment and any and all subsequent amendments, modifications, and supplements to this Amendment, including without limitation, the reasonable costs and fees of the Agent’s legal counsel; and (ii) all reasonable costs and expenses reasonably incurred by the Agent in connection with the enforcement or preservation of any rights under the Loan Agreement, this Amendment, and/or the other Loan Documents, including without limitation, the reasonable costs and fees of the Agent’s legal counsel.

ARTICLE VI

MISCELLANEOUS

6.01 Cross-References. References in this Amendment to any Section are, unless otherwise specified, to such Section of this Amendment.

14

6.02 Instrument Pursuant to Loan Agreement. This Amendment is a Loan Document executed pursuant to the Loan Agreement and shall (unless otherwise expressly indicated herein) be construed, administered, and applied in accordance with the terms and provisions of the Loan Agreement.

6.03 Acknowledgment of the Obligors. Each Obligor hereby represents and warrants that the execution and delivery of this Amendment and compliance by such Obligor with all of the provisions of this Amendment: (i) are within the powers and purposes of such Obligor; (ii) have been duly authorized or approved by the board of directors (or other appropriate governing body) of such Obligor; and (iii) when executed and delivered by or on behalf of such Obligor will constitute valid and binding obligations of such Obligor, enforceable in accordance with its terms. Each Obligor reaffirms its obligations to perform and pay all amounts due to the Agent or the Lenders under the Loan Documents (including, without limitation, its obligations under any promissory note evidencing any of the Loans) in accordance with the terms thereof, as amended and modified hereby.

6.04 Loan Documents Unmodified. Each of the amendments provided herein shall apply and be effective only with respect to the provisions of the Loan Document specifically referred to by such amendments. Except as otherwise specifically modified by this Amendment, all terms and provisions of the Loan Agreement and all other Loan Documents, as modified hereby, shall remain in full force and effect and are hereby ratified and confirmed in all respects. Nothing contained in this Amendment shall in any way impair the validity or enforceability of the Loan Documents, as modified hereby, or alter, waive, annul, vary, affect, or impair any provisions, conditions, or covenants contained therein or any rights, powers, or remedies granted therein, except as otherwise specifically provided in this Amendment. Subject to the terms of this Amendment, any lien and/or security interest granted to the Agent, for the benefit of the Lenders, in the Collateral set forth in the Loan Documents shall remain unchanged and in full force and effect and the Loan Agreement and the other Loan Documents shall continue to secure the payment and performance of all of the Obligations.

6.05 Parties, Successors and Assigns. This Amendment represents the agreement of the Borrowers, the Agent and each of the Lenders signatory hereto with respect to the subject matter hereof, and there are no promises, undertakings, representations, or warranties relative to the subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents. This Amendment shall be binding upon and inure to the benefit of Borrowers, Agent, Lenders, and their respective successors and assigns, except that (i) no Borrower shall have the right to assign its rights or delegate its obligations under any Loan Documents; and (ii) any assignment by a Lender must be made in compliance with Section 13.3 of the Loan Agreement.

6.06 Counterparts. This Amendment may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment shall become effective when all conditions precedent have been met and when the Agent has executed it and received counterparts bearing the signatures of all other parties hereto. Delivery of a signature page of this Amendment by telecopy shall be effective as delivery of a manually executed counterpart of such agreement. This Amendment may be executed and delivered by facsimile or electronic mail, and will have the same force and effect as manually signed originals. Any electronic signature, contract formation on an electronic platform and electronic record-keeping shall have the same legal validity and enforceability as a manually executed signature or use of a paper-based recordkeeping system to the fullest extent permitted by Applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any similar state law based on the Uniform Electronic Transactions Act.

6.07 Headings. The headings, captions, and arrangements used in this Amendment are for convenience only, are not a part of this Amendment, and shall not affect the interpretation hereof.

15

6.08 Waivers. To the fullest extent permitted by Applicable Law, each Borrower waives (a) the right to trial by jury (which the Agent and each Lender hereby also waives) in any proceeding or dispute of any kind relating in any way to any Loan Documents (including this Amendment), Obligations, or Collateral; (b) presentment, demand, protest, notice of presentment, default, non-payment, maturity, release, compromise, settlement, extension or renewal of any commercial paper, accounts, documents, instruments, chattel paper, and guaranties at any time held by the Agent on which a Borrower may in any way be liable, and hereby ratifies anything the Agent may do in this regard; (c) notice prior to taking possession or control of any Collateral; (d) any bond or security that might be required by a court prior to allowing the Agent to exercise any rights or remedies; (e) the benefit of all valuation, appraisement and exemption laws; (f) any claim against the Agent, Issuing Bank or any Lender, on any theory of liability, for special, indirect, consequential, exemplary, or punitive damages (as opposed to direct or actual damages) in any way relating to any Enforcement Action, Obligations, Loan Documents or transactions relating thereto; and (g) notice of acceptance hereof. Each Borrower acknowledges that the foregoing waivers are a material inducement to the Agent, Issuing Bank and Lenders entering into this Amendment and that the Agent, Issuing Bank and Lenders are relying upon the foregoing in their dealings with the Borrowers. Each Borrower has reviewed the foregoing waivers with its legal counsel and has knowingly and voluntarily waived its jury trial and other rights following consultation with legal counsel. In the event of litigation, this Amendment may be filed as a written consent to a trial by the court.

6.09 Choice of Law; Jury Trial Waiver; Submission to Jurisdiction. THIS AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS, WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS). EACH BORROWER HEREBY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL OR STATE COURT SITTING IN OR WITH JURISDICTION OVER THE STATE OF ILLINOIS, IN ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING RELATING IN ANY WAY TO ANY LOAN DOCUMENTS, AND AGREES THAT ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING SHALL BE BROUGHT BY IT SOLELY IN ANY SUCH COURT. EACH BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL CLAIMS, OBJECTIONS AND DEFENSES THAT IT MAY HAVE REGARDING ANY SUCH COURT’S PERSONAL OR SUBJECT MATTER JURISDICTION, VENUE OR INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 14.3.1 OF THE LOAN AGREEMENT. A final judgment in any proceeding of any such court shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or any other manner provided by Applicable Law. Nothing herein shall limit the right of the Agent or any Lender to bring proceedings against any Obligor in any other court, nor limit the right of any party to serve process in any other manner permitted by Applicable Law. Nothing in this Amendment shall be deemed to preclude enforcement by the Agent of any judgment or order obtained in any forum or jurisdiction.

6.10 Severability. Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be valid under Applicable Law. If any provision is found to be invalid under Applicable Law, it shall be ineffective only to the extent of such invalidity and the remaining provisions of the Loan Documents shall remain in full force and effect.

6.11 Total Agreement. This Amendment, the Loan Agreement, and all other Loan Documents constitute the entire agreement, and supersede all prior understandings and agreements among the parties relating to the subject matter hereof.

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6.12 Release. IN CONSIDERATION OF THIS AMENDMENT, EACH OBLIGOR REPRESENTS AND WARRANTS THAT AS OF THE DATE HEREOF THERE ARE NO KNOWN CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS, AND HEREBY WAIVES ANY AND ALL CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF ITS EXECUTION OF THIS AMENDMENT AND RELEASES AND DISCHARGES AGENT, EACH LENDER AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SHAREHOLDERS, AFFILIATES AND ATTORNEYS (COLLECTIVELY THE “RELEASED PARTIES”) FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH SUCH OBLIGOR HAS OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.

[Remainder of Page Intentionally Left Blank]

17

IN WITNESS WHEREOF, the parties have executed and delivered this Amendment as of the day and year first written above.

BORROWERS:
ARCTIC CAT INC., a Minnesota corporation
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT SALES INC., a Minnesota corporation
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT PRODUCTION LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT PRODUCTION SUPPORT LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT SHARED SERVICES LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
MOTORFIST, LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Treasurer

Notice Address for Borrowers:

505 Waterford Park, Suite 1000

505 N. Highway 169

Plymouth, MN 55441

Attn:             Christopher J. Eperjesy, CFO

Telecopy:     763.354.1803

BANK OF AMERICA, N.A.,
as Agent and Lender
By:	/s/ Brian Conole

Name:	Brian Conole
Title:	Senior Vice President
Address:	Bank of America Business Capital
	20975 Swenson Drive, Suite 200
	Waukesha, WI 53186
Telecopy:	262.207.3347

JPMORGAN CHASE BANK, N.A.,
as Lender
By:	/s/ Ray Gage
Name:	Ray Gage
Title:	Authorized Officer

Exhibit A

to

CONSENT AND THIRD AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

OPERATING AGREEMENT OF ACPS

See attached.

Exhibit B

to

CONSENT AND THIRD AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

EXHIBIT C

to

Amended and Restated Loan and Security Agreement

ORIGINAL NMTC EQUIPMENT

System Name	Serial No.		Fair Market Value		Manufacturer
TTX Paint System 480Y/227VAC/3 Phase/60 HZ, consisting of: •    Pretreatment System •    E-Coat System •    Post Rinse System •    E-Coat Oven •    E- Coat Cooling Tunnel •    Flash-Off/Bypass Tunnel •    Powder Oven •    Powder Cooling Tunnel •    Powder Room •    30 GPM R/O •    P&F CONV SYSTEM •    FINESSE Area Enclosure		2927	$	7,254,603.20	Therms-Tron-X Inc. (TTX)
Nordson ColorMax Powder coating system Fan Starter Upgrade		E-112452804	$	991,782.00	Nordson Corporation
IEP Explosion Protection (#32-091500-001) for Nordson Powder Paint Afterfilters 22000 CFM, including: •    Control Panels EX200 (2) •    Pressure Explosion Detectors (8) •    Detector Installation Kit (8) •    Pistonfire II PFII-1000 4KG PFII-1000 (8) •    Pistonfire II PFII-3000 20KG PFII-3000 (2) •    Cable Pistonfire 2 Kit (10) •    Sling-Cylinder 5L 13.5L 27L Sling •    Kit-elbow 180-degree kit (Nordson) (10) •    Spreader – Conical 3in (8) •    Spreader kit – 3in Hygienic spreader sst (2) •    Cap- blowout 3in blowout cap silicone (8)		#2868 #2869	$	64,635.93	IEP Technologies LLC
Aquila Carrier Management System •    DMM Carrier Management System with custom modifications per Arctic Cat Spec and software		1322241	$	40,725.00	The Aquila Group Inc.

Exhibit C

to

CONSENT AND THIRD AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

SCHEDULE 8.5

to

Amended and Restated Loan and Security Agreement

DEPOSIT ACCOUNTS

ARCTIC CAT INC.

Depository Bank	Type of Account	Account Numbers
Wells Fargo	Arctic Cat Inc. Operating	#####
Wells Fargo	Workers Comp.	#####
Bank of America	Blocked Account	#####
Bank of America	Blocked Account	#####
Bank of America	Controlled Disbursement Account	#####
Bank of America	Controlled Disbursement Account	#####
Bank of America	N/A – Not Used	#####
Bank of America	Self-Insured Workers Comp.	#####
Bank of America	AC Shared Services LLC/ Payroll/ Payroll Taxes	#####
Bank of America	AC Production Support LLC/ Payroll/Payroll Taxes	#####
Bank of America	AC Production LLC/ Payroll / Payroll Taxes	#####
Wells Fargo	Accounts Payable	#####
ARCTIC CAT SALES INC.
Depository Bank	Type of Account	Account Numbers
Wells Fargo	General	#####
Wells Fargo	Collateral Account Lockbox	#####
Bank of America	Operating Account – Canada	#####
Bank of America	Blocked Account	#####
Wells Fargo	Operating Account	#####
MOTORFIST, LLC
Depository Bank	Type of Account	Account Numbers
Wells Fargo	General (for Corp. Credit Cards)	#####
Bank of America	Operating (CAD)	#####
Bank of America	Operating (CAD)	#####

ARCTIC CAT PRODUCTION SUPPORT LLC

Depository Bank	Type of Account	Account Numbers
Wells Fargo Bank, National Association	NMTC Disbursement Account	####-######
Wells Fargo Bank, National Association	Operating	####-######

EX-10.39

Exhibit 10.39

CONSENT AND FOURTH AMENDMENT TO THE AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

This CONSENT AND FOURTH AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”) is dated as of March 10, 2016, and is entered into by and among ARCTIC CAT INC., a Minnesota corporation (“Arctic Cat”), the Subsidiaries of Arctic Cat identified on the signature pages hereto (the “Borrowers” and, each, a “Borrower”), the financial institutions party to this Amendment from time to time as lenders (collectively, “Lenders”), and BANK OF AMERICA, N.A., a national banking association, as agent for the Lenders (“Agent”) and Issuing Bank.

WHEREAS, the Borrowers, the Agent, and the Lenders have entered into that certain Amended and Restated Loan and Security Agreement dated as of November 8, 2013 (as amended, restated, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, the Borrowers have requested that the Agent and the Lenders (a) consent to the amendment and restatement of the bylaws of Arctic Cat Production LLC, a Minnesota limited liability company (“ACP”), and Arctic Cat Shared Services LLC, a Minnesota limited liability company (“ACSS”), (b) waive the Existing Defaults, as defined below, and (c) agree to make certain amendments to the Loan Agreement; and

NOW, THEREFORE, in consideration of the mutual conditions and agreements set forth in the Loan Agreement and this Amendment, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

Initially capitalized terms used but not otherwise defined in this Amendment have the respective meanings set forth in the Loan Agreement, as amended hereby.

ARTICLE II

CONSENTS, WAIVER AND AMENDMENTS TO LOAN AGREEMENT

2.01 Limited Consent.

(a) The Borrowers have advised the Agent and the Lenders that each of (i) ACP and (ii) ACSS plans to amend and restate its bylaws so that such bylaws are replaced in their entirety by an operating agreement in the respective form attached to this Amendment as Exhibit A (the “Bylaws Amendment and Restatement”). The Borrowers hereby acknowledge that, absent the consent set forth in this Section 2.01, the Bylaws Amendment and Restatement would not be permitted pursuant to Section 10.2.10 of the Loan Agreement and such amendment and restatement would be an Event of Default under Section 11.1(c) of the Loan Agreement. The Borrowers hereby request that the Agent and the Lenders consent to the Bylaws Amendment and Restatement.

(b) Subject to the terms, conditions, and other restrictions set forth in this Amendment, each of the Agent and the Lenders hereby consents to the Bylaws Amendment and

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Restatement solely as described in clause (a) above, so long as such Bylaws Amendment and Restatement does not cause the execution, delivery and performance of the Loan Documents by ACP or ACSS to contravene its Organic Documents.

(c) The consent set forth in this Section 2.01 does not affect the continued legality, validity, and binding effect of the Loan Agreement or the other Loan Documents. The Loan Agreement and the other Loan Documents continue to be fully enforceable in each case. The consent set forth in this Section 2.01 is specifically limited in time and scope to the Bylaws Amendment and Restatement, solely as described in this Amendment, and does not extend or apply to any other event, occurrence, or circumstance in existence as of the date of this Amendment or arising after the date of this Amendment. In addition, the consent set forth in this Section 2.01 does not constitute or establish (and is not to be deemed to constitute or establish) a custom or a practice on the part of the Agent or any Lender and does not prejudice any right of the Agent or any Lender in respect of any other disposition of Property or any other amendment, modification or other change to any Organic Document of any Obligor or Subsidiary of an Obligor.

2.02 Limited Waiver.

(a) The Borrowers have advised Agent and Lenders that Arctic Cat amended and restated its bylaws on or about August 7, 2014 and amended its articles of incorporation on or about August 8, 2014, in each case without obtaining the prior written consent of the Agent (the “Noncompliance”). Borrowers acknowledge that, as a result of the above-mentioned actions and failures to act, Events of Default exist under Section 11.1(c) of the Loan Agreement (the “Existing Defaults”).

(b) The Agent and the Lenders hereby waive the Noncompliance and the Existing Defaults (such waivers, collectively, the “Waiver”). Such Waiver is conditioned upon the terms and conditions set forth herein, shall be limited precisely as described herein and shall relate solely to the Noncompliance and the Existing Defaults described herein. Nothing in this Amendment shall be construed to (i) constitute a waiver of compliance or default by the Borrowers with respect to the Loan Documents in any other instance or any other instrument or agreement referred to in the Loan Documents; or (ii) prejudice any right or remedy that the Agent or any Lender may now have or may have in the future under or in connection with any Loan Document or any other instrument or agreement referred to therein.

2.03 Definitions.

(a) Existing Definitions. The following definitions set forth in Section 1.1 of the Loan Agreement are hereby amended as follows:

(i) The definition of “Applicable Margin” is hereby amended and restated in its entirety as follows:

Applicable Margin: the margin set forth below, as determined by the average daily Availability and Leverage Ratio, as applicable, for the last Fiscal Quarter (with the Leverage Ratio calculated on a trailing twelve-month basis):

2

Level	Availability & Leverage Requirements	Base Rate Loans			LIBOR Loans
I	Availability > 50% of the aggregate amount of the Revolver Commitments then in effect and the Leverage Ratio (calculated on a trailing twelve-month basis) < 2.00:1.00		0	%		1.00	%
II	(a) Availability > 25% and < 50% of the aggregate amount of the Revolver Commitments then in effect or (b) Availability > 25% and the Leverage Ratio (calculated on a trailing twelve-month basis) > 2.00:1.00		0.25	%		1.25	%
III	Availability < 25% of the aggregate amount of the Revolver Commitments then in effect		0.50	%		1.50	%

Notwithstanding the foregoing, until June 30, 2016, margins shall be determined as if Level II were applicable. Margins shall be subject to increase or decrease by Agent on the first day of the calendar month following each Fiscal Quarter end. If, by the first day of the month, any financial statement or Borrowing Base Certificate due in the preceding month has not been received, then, at the option of Agent or Required Lenders, margins shall be determined as if Level III were applicable until the first day of the calendar month following actual receipt.

(ii) The definition of “Availability Reserve” is hereby amended and restated in its entirety as follows:

Availability Reserve: the sum (without duplication) of (a) the Inventory Reserve; (b) the Rent and Charges Reserve; (c) the Bank Product Reserve (excluding any portion of the Bank Product Reserve that relates to an FX Hedging Arrangement Reserve); (d) the Eligible Accounts Reserve; (e) during the months of January through April of each year and during the months of November through December of each year, the FX Hedging Arrangement Reserve; (f) the aggregate amount of liabilities secured by Liens upon Collateral that are senior to Agent’s Liens (excluding the aggregate amount of liabilities secured by Liens permitted under Section 10.2.2(l)) (but imposition of any such reserve shall not waive an Event of Default arising therefrom); and (g) such additional reserves, in such amounts and with respect to such matters, as Agent in its reasonable discretion may elect to impose from time to time (including without limitation reserves relating to any negative mark-to-market arising out of or relating to any Hedging Agreements).

(iii) The definition of “Average Distribution Availability” is hereby deleted in its entirety.

(iv) The definition of “Cash Dominion Trigger Period” is hereby amended and restated in its entirety as follows:

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Cash Dominion Trigger Period: the period commencing on the day that (a) an Event of Default occurs or (b) Availability is less than the greater of (i) $19,500,000 or (ii) 15% of the aggregate Revolver Commitments at such time.

(v) Clause (a)(iii) of the definition of “Eligible Account” is hereby amended and restated in its entirety as follows: “(iii) it is a domestic or Canadian Account (in each case other than the Net Yamaha Account) that is acceptable to Agent in its sole discretion;”.

(vi) The definition of “Fixed Charges” is hereby amended and restated in its entirety as follows:

Fixed Charges: the sum of (i) interest expense (other than payment-in-kind) and (ii) principal payments made on Borrowed Money (other than Revolver Loans).

(vii) The definition of “Fixed Charge Trigger Period” is hereby amended and restated in its entirety as follows:

Fixed Charge Trigger Period: the period commencing on the day that (a) an Event of Default occurs or (b) Availability is less than the greater of (i) $16,250,000 or (ii) 12.5% of the aggregate Revolver Commitments at such time.

(viii) The last sentence of the definition of “Inventory Formula Amount” is hereby amended and restated in its entirety as follows:

“For purposes of calculating the Borrowing Base, the Inventory Formula Amount shall in no event exceed (a) $130,000,000 at any time during the period beginning on May 1 and ending on November 30 of each calendar year or (b) $75,000,000 at any time during the month of December or the period beginning on January 1 and ending on April 30 of each calendar year.”

(ix) The definition of “LIBOR” is hereby amended and restated in its entirety as follows:

LIBOR: the per annum rate of interest (rounded up, if necessary, to the nearest 1/8th of 1%) determined by Agent at or about 11:00 a.m. (London time) two Business Days prior to an interest period, for a term equivalent to such period, equal to the London Interbank Offered Rate, or comparable or successor rate approved by Agent, as published on the applicable Reuters screen page (or other commercially available source designated by Agent from time to time); provided, that any such comparable or successor rate shall be applied by Agent, if administratively feasible, in a manner consistent with market practice; provided further, that in no event shall LIBOR be less than zero.

(x) The definition of “Termination Date” is hereby amended and restated in its entirety as follows:

Termination Date: the earlier of (a) March 10, 2021, or (b) 60 days prior to the termination date or maturity date of any Dealer Finance Agreement, if not sooner replaced by a dealer floor plan financing that is acceptable to Agent in its sole discretion.

(xi) The definition of “Trade Name Amortization” is hereby deleted in its entirety.

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(xii) The definition of “Trade Name Amount” is hereby amended and restated in its entirety as follows:

Trade Name Amount: (a) Until Agent has obtained and approved the 2016 Appraisal, $16,250,000 and (b) on and after such time, an amount initially equal to the lesser of (i) $30,000,000 or (ii) 85% of the Distressed Trade Name Value, which amount shall reduce by 1/48th on the last day of each calendar month.

(b) New Definitions. The following definitions are hereby inserted in Section 1.1 of the Loan Agreement in appropriate alphabetical order:

2016 Appraisal: the appraisal scheduled to occur in the year of 2016 of the Borrowers’ trade names performed by an appraiser satisfactory to Agent in its sole discretion and with results satisfactory to Agent in its sole discretion.

Average Availability: as of any applicable date and for the thirty-day period ending as of such date, the thirty-day average of the Borrowers’ Availability.

Distressed Trade Name Value: the distressed value of the Borrowers’ trade names expected to be realized, net of all liquidation expenses, as determined from the most recent appraisal of the Borrowers’ trade names performed by an appraiser satisfactory to Agent in its sole discretion and in an amount satisfactory to Agent in its sole discretion.

Eligible Accounts Reserve: the aggregate amount of reserves established by Agent from time to time in its sole discretion in respect of Eligible Accounts.

Fourth Amendment Effective Date: March 10, 2016.

Leverage Ratio: the ratio, determined on a consolidated basis for Borrowers and Subsidiaries, calculated as of the last day of each Fiscal Quarter, of (a) Debt to (b) EBITDA.

2.04 Payment of Interest. Subsection (c) of Section 3.1.1 of the Loan Agreement is hereby amended and restated in its entirety as follows:

“(c) Interest shall accrue from the date a Loan is advanced or Obligation is incurred or payable, until paid in full by Borrowers, and shall in no event be less than zero at any time. Interest accrued on the Loans shall be due and payable in arrears, (i) on the first day of each month; (ii) on any date of prepayment, with respect to the principal amount of Loans being prepaid; and (iii) on the Commitment Termination Date. Interest accrued on any other Obligations shall be due and payable as provided in the Loan Documents and, if no payment date is specified, shall be due and payable on demand.”

2.05 FATCA Grandfathering. A new Section 5.8.7 is hereby added to the Loan Agreement to read in its entirety as follows:

“5.8.7 FATCA Grandfathering. For purposes of determining withholding Taxes imposed under FATCA, from and after the Fourth Amendment Effective Date, the Obligors and the Agent shall treat (and the Lenders hereby authorize the Agent to treat) the Loans as not qualifying as “grandfathered obligations” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).”

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2.06 Trade Name Appraisal. The following sentence is hereby added to the end of Section 10.1.11 of the Loan Agreement: “In addition, the Borrowers shall cooperate with and permit Agent, to complete an appraisal (which may be in addition to the annual appraisals permitted by the immediately foregoing sentence) of the Borrowers’ trade name valuations on or before May 31, 2016, with results satisfactory to Agent and using an appraiser satisfactory to Agent, and Borrowers shall pay Agent’s then standard charges for such appraisal, including the standard charges of Agent’s internal examination and appraisal groups, as well as the charges of any third party used for such purposes.”

2.07 Post-Closing Obligations.

(a) Clause (vi) of Section 10.1.12 of the Loan Agreement is hereby amended by deleting the reference to “March 11, 2016” and replacing it with “March 30, 2016”;

(b) The period at the end of Section 10.1.12 of the Loan Agreement is hereby replaced with a semicolon and the word “and”;

(c) The following clause is hereby inserted at the end of Section 10.1.12 of the Loan Agreement:

“(vii) promptly after the first meeting of the Board of Directors of Arctic Cat to occur after the Fourth Amendment Effective Date, (A) resolutions (the “New Resolutions”) of such Board of Directors (1) ratifying the execution and delivery of that certain Consent and Fourth Amendment to the Amended and Restated Loan and Security Agreement (the “Fourth Amendment”), dated as of the Fourth Amendment Effective Date, by and among the Borrowers, the Agent, and the Lenders, and the other Loan Documents executed and delivered to Agent and/or Lenders in connection therewith (together with the Fourth Amendment, the “Fourth Amendment Loan Documents”), and describing the Loan Agreement and such Fourth Amendment with specificity, (2) approving the increase to the Revolver Commitments effected by the Fourth Amendment and the performance Arctic Cat’s obligations under the Loan Documents, as modified by the Fourth Amendment Loan Documents, and (3) providing that the resolutions of such Board of Directors certified to Agent on November 8, 2013 remain in full force and effect, as supplemented by the New Resolutions, and (B) an original certificate of the Secretary of Arctic Cat certifying that an attached copy of the New Resolutions is true and complete, and that such New Resolutions are in full force and effect, were duly adopted, have not been amended, modified or revoked, and, together with resolutions certified copies of which have been delivered to Agent on or prior to the Fourth Amendment Effective Date, constitute all resolutions necessary or appropriate with respect to the credit facility provided pursuant to this Agreement. Agent may conclusively rely on such certificate until it is otherwise notified by Arctic Cat in writing.”

2.08 Distributions; Upstream Payments.

(a) Subsection (a) of Section 10.2.3 of the Loan Agreement is hereby amended and restated in its entirety as follows:

“(a) Declare or make any Distributions, unless the Average Availability as of the date of such Distribution is at least the greater of (1) $26,000,000 or (2) 20% of the aggregate Revolver Commitments in effect as of the date of such Distribution (provided, however, that such aggregate Revolver Commitments for purposes of this clause shall at no time be

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less than $130,000,000), in either case both before and after giving effect to such Distribution (including the date of such Distribution).”

(b) Subsection (b) of Section 10.2.3 of the Loan Agreement is hereby amended and restated as follows:

“[(b) Reserved].”

2.09 Restricted Investments. Section 10.2.4 of the Loan Agreement is hereby amended and restated in its entirety as follows:

“10.2.4 Restricted Investments. Make any Restricted Investment, unless:

(a) (x) Average Availability is at least the greater of (i) $19,500,000 or (ii) 15% of the aggregate Revolver Commitments in effect as of the date of such Restricted Investment (provided, however, that such aggregate Revolver Commitments for purposes of this clause shall at no time be less than $130,000,000), in either case both before and after giving effect to such Restricted Investment (including the date of such Restricted Investment) and (y) the Borrowers shall have delivered to Agent a certificate from the Borrower Agent showing that all of their account payables are current as of the date of such Restricted Investment, or

(b) solely with regard to any Acquisitions for which the total consideration for such Acquisitions do not exceed $10,000,000 in any one Fiscal Year and for which the total consideration for all such Acquisitions during the life of this Agreement do not exceed $20,000,000 in the aggregate, (x) Average Availability is at least the greater of (i) $15,275,000 or (ii) 11.75% of the aggregate Revolver Commitments in effect as of the date of such Acquisition, in either case both for the thirty-day period before and after giving effect to such Acquisition (including the date of such Acquisition) and (y) no Default or Event of Default exists both before and after giving effect to such Acquisition (including the date of such Acquisition).”

2.10 Financial Covenants. Section 10.3.1 of the Loan Agreement is hereby amended by deleting the reference to “1.10 to 1.0” and replacing it with “1.0 to 1.0”.

2.11 Revolver Commitments. Schedule 1.1(B) of the Loan Agreement is hereby amended and restated to read in its entirety as set forth on Exhibit B attached hereto.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Obligor hereby represents and warrants to each Lender and the Agent, as of the Fourth Amendment Effective Date (as such term is defined in Section 4.01 below), as follows:

3.01 Representations and Warranties. After giving effect to this Amendment, the representations and warranties set forth in the Loan Agreement as modified by this Amendment, including without limitation Section 9 thereof, and in each other Loan Document are true and correct in all material respects (without duplication of any materiality qualifier contained therein) on and as of the date hereof and on and as of the Fourth Amendment Effective Date with the same effect as if made on and as of the date hereof or the Fourth Amendment Effective Date, as the case may be, except to the extent

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such representations and warranties expressly relate solely to an earlier date (in which case such representations and warranties shall be true and correct as of such specific date in such respect).

3.02 No Defaults. After giving effect to this Amendment, each of the Obligors is in compliance with all terms and conditions of the Loan Agreement, as modified by this Amendment, and the other Loan Documents on its part to be observed and performed and no Default or Event of Default has occurred and is continuing.

3.03 Authority and Pending Actions. The execution, delivery, and performance by each Obligor of this Amendment has been duly authorized by each such Obligor (as applicable) (including, in the case of each of ACSS and ACP, both before and after giving effect to the Bylaws Amendment and Restatement) and there is no action pending or any judgment, order, or decree in effect which is likely to restrain, prevent, or impose materially adverse conditions upon the performance by any Obligor of its obligations under the Loan Agreement, as modified by this Amendment, or the other Loan Documents.

3.04 Enforceability. This Amendment and the Loan Agreement, as modified by this Amendment, each constitutes the legal, valid, and binding obligation of each Obligor, enforceable against each such Obligor in accordance with its terms, except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, moratorium, reorganization, or other similar laws affecting the enforcement of creditors’ rights or by the effect of general equitable principles.

3.05 Breach; Conflicts. The execution, delivery, and performance by each Obligor of this Amendment do not and will not conflict with, or constitute a violation or breach of, or result in the imposition of any Lien upon the property of such Obligor, by reason of the terms of (i) any contract, mortgage, lease, agreement, indenture, or instrument to which such Obligor is a party or which is binding upon it, (ii) any Applicable Law with respect to such Obligor, or (iii) any Organic Document of such Obligor (including, in the case of each of ACSS and ACP, both before and after giving effect to the Bylaws Amendment and Restatement).

ARTICLE IV

CONDITIONS PRECEDENT AND FURTHER ACTIONS

4.01 Conditions Precedent. The consents, waivers and amendments contained in Article II shall not be effective or binding upon the Agent or the Lenders until each of the following conditions precedent has been satisfied in form and substance satisfactory to the Agent (the first date upon which each such condition has been satisfied being herein called the “Fourth Amendment Effective Date”):

(a) In each case after giving effect to this Amendment, (i) the representations and warranties contained herein and in the Loan Agreement, as modified by this Amendment, shall be true and correct in all material respects as of the date hereof (without duplication of any materiality qualifier contained therein), as if made on such date, except for such representations and warranties limited by their terms to a specific date (in which case such representations and warranties shall be true and correct as of such specific date in such respect) and (ii) no Default or Event of Default shall exist on the date hereof;

(b) Agent shall have received duly executed counterparts of (i) this Amendment, which, when taken together, bear the authorized signatures of the Borrowers, the Agent, the Issuing Bank, and the Lenders, (ii) an amended and restated fee letter, which, when taken together, bear the authorized signatures of the Borrowers and the Agent, (iii) a second amended and restated revolver note payable to order of JPMorgan Chase Bank, N.A., which, when taken together, bear the authorized signatures of the

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Borrowers, and (iv) a fourth amended and restated revolver note payable to the order of Bank of America, N.A., which, when taken together, bear the authorized signatures of the Borrowers;

(c) Agent shall have received a certificate of a duly authorized officer of each Obligor, certifying (i) that attached copies of such Obligor’s Organic Documents (with the copies of charter documents being certified by the Secretary of State or other appropriate official of such Obligor’s jurisdiction of organization) are true and complete, and in full force and effect, without amendment except as shown, or that such Obligor’s Organic Documents most recently certified to Agent are in full force and effect and have not been amended except as shown on the officer’s certificate most recently delivered to Agent with such Obligor’s Organic Documents attached thereto; (ii) that an attached copy of resolutions authorizing execution and delivery of this Amendment and the other Loan Documents executed and delivered to Agent and/or Lenders in connection herewith is true and complete, and that such resolutions are in full force and effect, were duly adopted, have not been amended, modified or revoked, and constitute all resolutions necessary or appropriate with respect to this credit facility; (iii) to the title, name and signature of each Person authorized to sign the Loan Documents, or that such titles, names and signatures have not changed since most recently certified to Agent; and (iv) that such Obligor is in good standing in such Obligor’s jurisdiction of organization and each jurisdiction where such Obligor’s conduct of business or ownership of Property necessitates qualification, and attaching good standing certificates issued by the Secretary of State or other appropriate official of each such jurisdiction. Agent may conclusively rely on each such certificate until it is otherwise notified by the applicable Obligor in writing;

(d) Agent shall have received a written opinion of Fredrikson & Byron, P.A., in form and substance satisfactory to Agent;

(e) the Borrowers shall have paid to the Agent (i) a fee in the amount of $65,000 (the “Amendment Fee”), which Amendment Fee each Borrower hereby expressly agrees and acknowledges shall be fully earned as of the Fourth Amendment Effective Date and (ii) all other fees, costs, and expenses owed to and/or incurred by the Agent and the Lenders in connection with this Amendment;

(f) Agent shall have received such other documents, legal opinions, instruments, and certificates relating to this Amendment as it shall reasonably request and such other documents, legal opinions, instruments, and certificates that shall be satisfactory in form and substance to the Agent and the Lenders. All corporate proceedings taken or to be taken in connection with this Amendment and documents incidental thereto whether or not referred to herein shall be reasonably satisfactory in form and substance to the Agent and the Lenders; and

(g) all proceedings taken in connection with the transactions contemplated by this Amendment and all documentation and other legal matters incident thereto shall be satisfactory to the Agent in its sole and absolute discretion.

4.02 Further Actions. Each of the parties to this Amendment agrees that at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Amendment.

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ARTICLE V

COSTS AND EXPENSES

Without limiting the terms and conditions of the Loan Documents, the Obligors jointly and severally agree to pay on demand: (i) all reasonable costs and expenses incurred by the Agent in connection with the preparation, negotiation, and execution of this Amendment and the other Loan Documents executed pursuant to this Amendment and any and all subsequent amendments, modifications, and supplements to this Amendment, including without limitation, the reasonable costs and fees of the Agent’s legal counsel; and (ii) all reasonable costs and expenses reasonably incurred by the Agent in connection with the enforcement or preservation of any rights under the Loan Agreement, this Amendment, and/or the other Loan Documents, including without limitation, the reasonable costs and fees of the Agent’s legal counsel.

ARTICLE VI

MISCELLANEOUS

6.01 Cross-References. References in this Amendment to any Section are, unless otherwise specified, to such Section of this Amendment.

6.02 Instrument Pursuant to Loan Agreement. This Amendment is a Loan Document executed pursuant to the Loan Agreement and shall (unless otherwise expressly indicated herein) be construed, administered, and applied in accordance with the terms and provisions of the Loan Agreement.

6.03 Acknowledgment of the Obligors. Each Obligor hereby represents and warrants that the execution and delivery of this Amendment and compliance by such Obligor with all of the provisions of this Amendment: (i) are within the powers and purposes of such Obligor (including, in the case of each of ACSS and ACP, both before and after giving effect to the Bylaws Amendment and Restatement); (ii) have been duly authorized or approved by the board of directors (or other appropriate governing body) of such Obligor (including, in the case of each of ACSS and ACP, both before and after giving effect to the Bylaws Amendment and Restatement); and (iii) when executed and delivered by or on behalf of such Obligor will constitute valid and binding obligations of such Obligor, enforceable in accordance with its terms. Each Obligor reaffirms its obligations to perform and pay all amounts due to the Agent or the Lenders under the Loan Documents (including, without limitation, its obligations under any promissory note evidencing any of the Loans) and its grant of a security interest thereunder, in each case in accordance with the terms thereof, as amended and modified hereby.

6.04 Loan Documents Unmodified. Each of the consents, waivers, and amendments provided herein shall apply and be effective only with respect to the provisions of the Loan Document specifically referred to by such amendments. Except as otherwise specifically modified by this Amendment, all terms and provisions of the Loan Agreement and all other Loan Documents, as modified hereby, shall remain in full force and effect and are hereby ratified and confirmed in all respects. Nothing contained in this Amendment shall in any way impair the validity or enforceability of the Loan Documents, as modified hereby, or alter, waive, annul, vary, affect, or impair any provisions, conditions, or covenants contained therein or any rights, powers, or remedies granted therein, except as otherwise specifically provided in this Amendment. Subject to the terms of this Amendment, any lien and/or security interest granted to the Agent, for the benefit of the Lenders, in the Collateral set forth in the Loan Documents is reaffirmed and shall remain unchanged and in full force and effect and the Loan Agreement and the other Loan Documents shall continue to secure the payment and performance of all of the Obligations.

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6.05 Parties, Successors and Assigns. This Amendment represents the agreement of the Borrowers, the Agent and each of the Lenders signatory hereto with respect to the subject matter hereof, and there are no promises, undertakings, representations, or warranties relative to the subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents. This Amendment shall be binding upon and inure to the benefit of Borrowers, Agent, Lenders, and their respective successors and assigns, except that (i) no Borrower shall have the right to assign its rights or delegate its obligations under any Loan Documents; and (ii) any assignment by a Lender must be made in compliance with Section 13.3 of the Loan Agreement.

6.06 Counterparts. This Amendment may be executed in counterparts, each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment shall become effective when all conditions precedent have been met and when the Agent has executed it and received counterparts bearing the signatures of all other parties hereto. Delivery of a signature page of this Amendment by telecopy shall be effective as delivery of a manually executed counterpart of such agreement. This Amendment may be executed and delivered by facsimile or electronic mail, and will have the same force and effect as manually signed originals. Any electronic signature, contract formation on an electronic platform and electronic record-keeping shall have the same legal validity and enforceability as a manually executed signature or use of a paper-based recordkeeping system to the fullest extent permitted by Applicable Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any similar state law based on the Uniform Electronic Transactions Act.

6.07 Headings. The headings, captions, and arrangements used in this Amendment are for convenience only, are not a part of this Amendment, and shall not affect the interpretation hereof.

6.08 Waivers. To the fullest extent permitted by Applicable Law, each Borrower waives (a) the right to trial by jury (which the Agent and each Lender hereby also waives) in any proceeding or dispute of any kind relating in any way to any Loan Documents (including this Amendment), Obligations, or Collateral; (b) presentment, demand, protest, notice of presentment, default, non-payment, maturity, release, compromise, settlement, extension or renewal of any commercial paper, accounts, documents, instruments, chattel paper, and guaranties at any time held by the Agent on which a Borrower may in any way be liable, and hereby ratifies anything the Agent may do in this regard; (c) notice prior to taking possession or control of any Collateral; (d) any bond or security that might be required by a court prior to allowing the Agent to exercise any rights or remedies; (e) the benefit of all valuation, appraisement and exemption laws; (f) any claim against the Agent, Issuing Bank or any Lender, on any theory of liability, for special, indirect, consequential, exemplary, or punitive damages (as opposed to direct or actual damages) in any way relating to any Enforcement Action, Obligations, Loan Documents or transactions relating thereto; and (g) notice of acceptance hereof. Each Borrower acknowledges that the foregoing waivers are a material inducement to the Agent, Issuing Bank and Lenders entering into this Amendment and that the Agent, Issuing Bank and Lenders are relying upon the foregoing in their dealings with the Borrowers. Each Borrower has reviewed the foregoing waivers with its legal counsel and has knowingly and voluntarily waived its jury trial and other rights following consultation with legal counsel. In the event of litigation, this Amendment may be filed as a written consent to a trial by the court.

6.09 Choice of Law; Jury Trial Waiver; Submission to Jurisdiction. THIS AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS, WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS). EACH BORROWER HEREBY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL OR STATE

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COURT SITTING IN OR WITH JURISDICTION OVER THE STATE OF ILLINOIS, IN ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING RELATING IN ANY WAY TO ANY LOAN DOCUMENTS, AND AGREES THAT ANY DISPUTE, ACTION, LITIGATION OR OTHER PROCEEDING SHALL BE BROUGHT BY IT SOLELY IN ANY SUCH COURT. EACH BORROWER IRREVOCABLY AND UNCONDITIONALLY WAIVES ALL CLAIMS, OBJECTIONS AND DEFENSES THAT IT MAY HAVE REGARDING ANY SUCH COURT’S PERSONAL OR SUBJECT MATTER JURISDICTION, VENUE OR INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 14.3.1 OF THE LOAN AGREEMENT. A final judgment in any proceeding of any such court shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or any other manner provided by Applicable Law. Nothing herein shall limit the right of the Agent or any Lender to bring proceedings against any Obligor in any other court, nor limit the right of any party to serve process in any other manner permitted by Applicable Law. Nothing in this Amendment shall be deemed to preclude enforcement by the Agent of any judgment or order obtained in any forum or jurisdiction.

6.10 Severability. Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be valid under Applicable Law. If any provision is found to be invalid under Applicable Law, it shall be ineffective only to the extent of such invalidity and the remaining provisions of the Loan Documents shall remain in full force and effect.

6.11 Total Agreement. This Amendment, the Loan Agreement, and all other Loan Documents constitute the entire agreement, and supersede all prior understandings and agreements among the parties relating to the subject matter hereof.

6.12 Release. IN CONSIDERATION OF THIS AMENDMENT, EACH OBLIGOR REPRESENTS AND WARRANTS THAT AS OF THE DATE HEREOF THERE ARE NO KNOWN CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS TO ITS OBLIGATIONS UNDER THE LOAN DOCUMENTS, AND HEREBY WAIVES ANY AND ALL CLAIMS, OFFSETS, DEFENSES OR COUNTERCLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF ITS EXECUTION OF THIS AMENDMENT AND RELEASES AND DISCHARGES AGENT, EACH LENDER AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, SHAREHOLDERS, AFFILIATES AND ATTORNEYS (COLLECTIVELY THE “RELEASED PARTIES”) FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH SUCH OBLIGOR HAS OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment as of the day and year first written above.

BORROWERS:
ARCTIC CAT INC., a Minnesota corporation
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT SALES INC., a Minnesota corporation
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT PRODUCTION LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT PRODUCTION SUPPORT LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
ARCTIC CAT SHARED SERVICES LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Chief Financial Officer
MOTORFIST, LLC, a Minnesota limited liability company
By:	/s/ Christopher J. Eperjesy
Name: Christopher J. Eperjesy
Title: Treasurer

Notice Address for Borrowers:
	505 Waterford Park, Suite 1000
	505 N. Highway 169
	Plymouth, MN 55441
	Attn:         Christopher J. Eperjesy, CFO
	Telecopy: 763.354.1803

BANK OF AMERICA, N.A.,
as Agent, Issuing Bank and Lender
By:	/s/ Brian Conole

Name:	Brian Conole
Title:	Senior Vice President
Address:	Bank of America Business Capital
	20975 Swenson Drive, Suite 200
	Waukesha, WI 53186
Telecopy:	262.207.3347

JPMORGAN CHASE BANK, N.A.,
as Lender
By:	/s/ Ray Gage
Name:	Ray Gage
Title:	Authorized Officer

Exhibit A

to

CONSENT AND FOURTH AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

OPERATING AGREEMENTS

See attached.

Exhibit B

to

CONSENT AND FOURTH AMENDMENT TO THE AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

SCHEDULE 1.1(B)

to

Amended and Restated Loan and Security Agreement

REVOLVER COMMITMENTS OF LENDERS

Lender	Revolver Commitment
Bank of America, N.A.	$84,500,000 during the months of May through November of each Fiscal Year; $48,750,000 during all other months of each Fiscal Year
JPMorgan Chase Bank, N.A.	$45,500,000 during the months of May through November of each Fiscal Year; $26,250,000 during all other months of each Fiscal Year

EX-10.40

Exhibit 10.40

ARCTIC CAT INC.

CASH-SETTLED APPRECIATION RIGHTS AGREEMENT

This CASH-SETTLED APPRECIATION RIGHTS AGREEMENT (“Agreement”) is made as of the 5th day of February, 2016 (the “Effective Date”), between Arctic Cat Inc., a Minnesota corporation (the “Company”), and Christopher T. Metz, President and Chief Executive Officer of the Company (“Employee”).

WHEREAS, the Company desires, by granting to Employee a cash-settled appreciation right (the “CSAR”) with respect to the common stock of the Company (the “Common Stock”), to carry out the purpose of the 2013 Omnibus Stock and Incentive Plan (the “2013 Stock Plan”) of the Company approved by its shareholders and administered by the Compensation and Human Resources Committee (the “Committee”) of the Company’s Board of Directors.

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other good and valuable consideration, the sufficiency of which is hereby acknowledged, the parties hereto have agreed, and do hereby agree, as follows:

1. Award.

(a) The CSAR. The Company hereby grants to Employee a CSAR with respect to a total of 175,000 shares of the Common Stock at a grant price of fourteen and 16/100 Dollars ($14.16) per share (the “Grant Price”), which is equal to the closing sale price of a share of the Common Stock on The Nasdaq Stock Market, or if not so listed, such other stock exchange on which the Common Stock is listed (“Market Price”), on the Effective Date of this Agreement.

(b) Issuance of the CSAR. The CSAR shall be issued upon acceptance hereof by Employee and upon satisfaction of the conditions of this Agreement.

(c) 2013 Stock Plan. The CSAR is subject to all of the terms and conditions set forth in the 2013 Stock Plan, including future amendments thereto, if any. A copy of the 2013 Stock Plan is on file with the Chief Financial Officer of the Company, and Employee, by acceptance hereof, agrees to and accepts this award of the CSAR subject to the terms of the 2013 Stock Plan.

2. Exercise of the CSAR.

(a) Right to Exercise. The CSAR may be exercised, in whole or in part, upon vesting in accordance with subparagraph (b) of this Paragraph 2 and during the term set forth in Paragraph 6. Upon exercise, Employee shall be entitled to receive from the Company cash proceeds in an amount equal to the product of: (A) the number of shares in respect of which the CSAR is being exercised, multiplied by (B) the difference between (i) the lower of $33.00 and the Market Price of one share of the Common Stock on the exercise date, minus (ii) the Grant Price.

(b) Vesting. The CSAR herein granted will vest in three equal annual installments beginning on the first anniversary of the Effective Date, provided Employee remains an employee of the Company on such dates.

(c) Method of Exercise. The CSAR shall be exercisable by written notice which shall state the election to exercise the CSAR and the number of shares in respect of which the CSAR is being exercised, and such other representations and agreements as may be required by the Company pursuant to the provisions of the 2013 Stock Plan. Such written notice shall be signed by Employee and shall be delivered in person or by certified mail to the Secretary of the Company. The cash proceeds that are payable in accordance with this Agreement with respect to the exercised portion of the CSAR shall be delivered as soon as practicable and in no event later than thirty (30) days after the notice shall have been received. In the event the CSAR shall be exercised by any person other than Employee, such notice shall be accompanied by appropriate proof of the right of such person to exercise the CSAR.

(d) Restriction on Exercise. No cash proceeds will be paid pursuant to the exercise of the CSAR unless such payment and such exercise shall comply with all relevant provisions of law and the requirements of The Nasdaq Stock Market or such other stock exchange on which the Common Stock is listed. Assuming such compliance, for income tax purposes, the cash proceeds will be considered paid to Employee on the date on which the CSAR is exercised.

3. Adjustment. The number of shares subject to the CSAR herein granted or the Grant Price are subject to adjustment by the Company’s Board of Directors in the event of an increase or decrease in the number of issued shares of the Common Stock resulting from a subdivision or consolidation of the Common Stock or the payment of a stock dividend on the Common Stock, or any other increase or decrease in the number of shares of the Common Stock effected without receipt or payment of consideration by the Company.

4. No Rights of Shareholder. Neither Employee nor any beneficiary or transferee thereof shall have any rights or privileges of a shareholder of the Company with respect to the shares underlying the CSAR. Except as expressly provided in Paragraph 3 of this Agreement or in the 2013 Stock Plan, no adjustment to the CSAR shall be made for dividends or other rights provided to shareholders.

5. Transferability. This CSAR may not be transferred in any manner other than by will or by laws of descent or distribution and may be exercised during the lifetime of Employee only by Employee. More particularly (but without limiting the generality of the foregoing), the CSAR may not be assigned, transferred (except as provided above), pledged, or hypothecated in any way; shall not be assignable by operation of law; and shall not be subject to execution, attachment, or similar process. Any attempted assignment, transfer, pledge, hypothecation, or other disposition of the CSAR contrary to the provisions hereof, and the levy of any execution, attachment, or similar process upon the CSAR, shall be null and void and without effect. The terms of the CSAR shall be binding upon Employee and his or her personal representative, heirs, successors and assigns.

6. Term. This CSAR shall immediately terminate on the fifth (5th) anniversary of the Effective Date and be of no further force and effect.

7. Withholding Taxes. Upon the exercise of the vested CSAR, Employee authorizes the Company to withhold a portion of the cash proceeds that Employee would otherwise be entitled to receive upon exercise of the CSAR in an amount sufficient to satisfy any applicable federal, state, local and foreign withholding or other taxes.

8. Termination of Employment Relationship. In the event the employment of Employee shall be terminated for any reason whatsoever, the previously-vested portion of the CSAR may be exercised by Employee at any time (i) until the date that is twelve (12) months after the date the CSAR became vested or twelve (12) months after the date of Retirement (as defined in the 2013 Stock Plan), whichever is later, if such termination was by reason of Retirement, (ii) within one (1) month after such termination if such termination was for any reason other than Retirement, Cause (as defined in the 2013 Stock Plan) or as provided in Paragraph 9 hereof, and (iii) no later than the date of termination if such termination was for Cause; provided, however, that in no event may the CSAR be exercised later than the expiration of the term specified in Paragraph 6. Unless otherwise determined by the Committee in writing after the date of this Agreement, upon termination for any reason, the CSAR shall be exercisable only to the extent Employee shall have been entitled to do so at the date of his termination of employment. Except as provided in Paragraph 10 hereof, so long as Employee shall continue to be an employee of the Company or one or more of its subsidiaries, the CSAR shall not be affected by any change of duties or position. Nothing in this Agreement shall confer

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upon Employee any right to continue in the employ of the Company or of any of its subsidiaries or interfere in any way with the right of the Company or any such subsidiary to terminate the employment of Employee at any time.

9. Death or Permanent Disability of Employee. If Employee shall die while still employed by the Company or one or more of its subsidiaries, or shall become permanently and totally disabled (as determined by the Committee) while still employed by the Company or one or more of its subsidiaries, the CSAR may be exercised (to the extent that Employee shall have been entitled to do so at the date of his or her death or termination by reason of permanent and total disability, unless otherwise determined by the Committee in writing after the date of this Agreement) by Employee, his or her legal representative or the person to whom the CSAR is transferred by will or the applicable laws of descent and distribution, at any time within twelve (12) months after Employee’s death or termination by reason of permanent and total disability, but in no event later than the expiration of the term specified in Paragraph 6 hereof.

10. Change of Control. If a Change in Control occurs (as defined in the Change of Control Agreement dated December 3, 2014 between the Company and the Employee, or any amended version thereof (the “Change of Control Agreement”)), any portion of the CSAR that is unvested as of the date of such Change in Control shall immediately accelerate and vest in full as provided in Section 5 of the Change of Control Agreement. Such acceleration will be subject to the terms and conditions of the Change of Control Agreement, including but not limited to Sections 5, 6, 7 and 14 thereof.

11. Company Authority. The existence of the CSAR herein granted shall not affect in any way the right or power of the Company or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of the Company, or any issuance of bonds, debentures, preferred or prior preference stock ahead of or affecting the Common Stock or its rights thereof, or dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

12. Disputes. As a condition of the granting of the CSAR herein granted, Employee agrees, for Employee and Employee’s personal representatives, that any dispute or disagreement which may arise under or as a result of or pursuant to this Agreement shall be determined by the Board of Directors of the Company, in its sole discretion, and that any interpretation of the Board of the terms of this Agreement shall be final, binding and conclusive.

13. Binding Effect. This Agreement shall be binding upon and inure to the benefit of any successors to the Company and all persons lawfully claiming under Employee.

14. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Minnesota.

IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officer thereunto duly authorized, and Employee has executed this Agreement, all as of the date first above written.

ARCTIC CAT INC.
By:	/s/ Christopher J. Eperjesy
	Christopher J. Eperjesy,
	Chief Financial Officer
/s/ Christopher T. Metz
Christopher T. Metz

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EX-10.41

Exhibit 10.41

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 4th day of April, 2015 by and between Arctic Cat Inc. (the “Company”) and Greg Williamson (“Executive”).

WHEREAS, the Company desires to employ Executive on the terms and conditions set forth herein; and

WHEREAS, Executive desires to be employed by the Company on such terms and conditions.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the sufficiency of which is hereby acknowledged, the parties agree as follows:

ARTICLE I.

DEFINITIONS

1.1 “Arctic Cat Products” means any goods or services which Executive or those under his direct report or indirect supervision designed, developed, marketed, promoted, sold, serviced, or provided on behalf of the Company during the last two years in which Executive was employed by the Company.

1.2 “Change in Control” has the same meaning as defined in that certain Change in Control Agreement of even or substantially even date of the Original Employment Agreement (the “Change in Control Agreement”), as such Change in Control Agreement may be amended from time to time.

1.3 “Code” means the Internal Revenue Code of 1986, as amended.

1.4 “Company” means Arctic Cat Inc. and all of its subsidiary and affiliated entities and their divisions which now exist or may exist in the future.

1.5 “Competitive Products” means any product, product line or service (including any component thereof or research to develop information useful in connection with a product or service) that is being designed, developed, manufactured, marketed, or sold by the Company, or with respect to which the Company has acquired Confidential Information which it intends to use in the design, development, manufacture, marketing, or sale of a product or service.

1.6 “Confidential Information” means any information or compilation of information that Executive learns or develops during the course of Executive’s employment by the Company that derives independent economic value from not being generally known, or readily ascertainable by proper means, by other persons who can obtain economic value from its disclosure or use. Confidential Information includes, but is not limited to, trade secrets and may

relate to such matters as research and development, engineering, drawings and specifications, strategic plans, business methods, non-public financial information, proprietary information pertaining to vendors and customers, product improvement efforts, manufacturing processes, management systems, sales and marketing plans and information, contracts, and pricing.

1.7 “Conflicting Organization” means any person or entity (regardless of its legal form) which is engaged in, or about to become engaged in, research or development, production, marketing or selling a Competitive Product, including Executive if Executive is engaged in business for herself.

1.8 “Customer” means any person or entity (regardless of its legal form) with whom or with which Executive or those under his direct or indirect supervision had any direct or indirect contact on behalf of the Company in connection with Arctic Cat Products. Without limiting the generality of the foregoing, the term Customer includes, but is not limited to, dealers, vendors, suppliers, and sponsors.

1.9 “Disability” has two different meanings in this Agreement. For purposes of benefits due under any Company-sponsored disability insurance policy (whether short-term, long-term, or any applicable salary continuation policy provided during any elimination period), the definition of Disability shall conform to the definition provided in such policy. For purposes of any payment made to Executive in excess of the benefits due under any such Company- sponsored disability insurance policy, the definition of Disability shall be at least as restrictive as the applicable definition provided in Section 409A of the Code.

1.10 “Invention” means all inventions, discoveries, ideas, processes, writings, designs, developments, and improvements, whether or not protectable under the applicable patent, trademark or copyright statutes, of Executive while employed by the Company.

ARTICLE II.

EMPLOYMENT AND TERM

2.1 Employment. Upon the terms and subject to the conditions set forth in this Agreement and effective upon commencement of the term set forth in Section 2.2 below, the Company hereby employs Executive as Chief Marketing Officer or in such other capacity as may be determined from time to time by the Company’s Chief Executive Officer or Board of Directors (the “Board”), and Executive hereby accepts such employment.

2.2 Term. The term of this Agreement shall commence on April 13, 2015 and shall continue until this Agreement is terminated by either party pursuant to the terms hereof.

ARTICLE III.

COMPENSATION

3.1 Base Salary. As compensation for his services to the Company and as consideration for the confidentiality, non-competition and non-solicitation agreements provided in Article IV of this Agreement, Executive shall receive an annual base salary in the amount of

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Two Hundred Eighty-five Thousand Dollars ($285,000) payable in accordance with the Company’s regular payroll processes (the “Base Salary”) and the additional compensation set forth in this Agreement. Executive’s Base Salary shall be reviewed by the Compensation and/or Human Resources Committee of the Board on an annual basis, beginning with the fiscal year that begins April 1, 2016, and such committee may, but is not be obligated to, adjust Executive’s Base Salary by an amount as it deems appropriate based on a review of certain benchmarking information, including but not limited to, general industry as well as industry specific and other peer company compensation data, as well as recommendations from the Chief Executive Officer.

3.2 Annual Incentive Awards. In addition to the Base Salary, starting with the fiscal year that begins April 1, 2015 (“Fiscal 2016”) Executive shall be eligible to participate in the Company’s annual incentive program offered to the Company’s senior executives. Executive’s annual incentive payout shall range from zero percent (0%) to two hundred percent (200%) of his target incentive payout (the “Annual Bonus”). The target incentive payout (the “Target Bonus”) for Executive for the fiscal year ending March 31, 2016 shall be forty percent (40%) of his Base Salary. Thereafter, the Board, or an appropriate committee of the Board, may, but is not obligated to, adjust Executive’s Target Bonus as it deems appropriate and consistent with the Company’s then existing annual incentive program. Payouts made pursuant to this Section 3.2 shall be paid no later than two and a half (2.5) months after the end of the Company’s fiscal year or as soon thereafter as practicable.

3.3 Long-Term Incentive Compensation. In addition to Base Salary and all other compensation provided in this Agreement, Executive shall be entitled to participate in the Company’s long-term incentive program (the “LTI”) beginning in Fiscal 2016. The Board has approved and will issue grants to Executive of stock options to purchase shares of common stock and shares of restricted stock units (“RSUs”) at the same time as similarly situated Executive Officers. The stock options will have a fair market value at the end of the first day of Executive’s employment of $153,750 (at an assumed Black-Scholes ratio of 40%) and the RSUs will have a fair market value of $51,250 at the end of the first day of Executive’s employment. The grants are made in accordance with the Company’s 2013 Omnibus Stock and Incentive Plan. The grants will vest in equal installments on the first, second and third anniversaries of the grant date.

3.4 One-Time Grants; Restricted Stock Units and Stock Options. On Executive’s first day of employment Executive will receive a grant of RSUs valued at $250,000 as determined by the closing price of the Company’s stock on Executive’s first day of employment. Executive represents and warrants that this amount represents the approximate value of unvested restricted stock units he would have received from his current employer but for commencement of employment with the Company at this time. In addition, on Executive’s first day of employment Executive will receive stock options to purchase shares of common stock of the Company valued at $250,000 as determined by the closing price of the Company’s stock on the first day of Executive’s employment with the Company (at an assumed Black-Scholes ratio of 40%). Executive represents and warrants that this amount represents the approximate value of performance shares he would have received from his current employer but for commencement of employment with the Company at this time. The RSUs and stock options described in this Section 3.4 will vest in equal installments on the first, second and third anniversaries of the grant

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date. Executive understands and agrees that if he terminates employment with the Company without Good Reason, as defined in Section 5.3 of this Agreement, within one year of his first day of employment with the Company, the RSUs and stock options described in this Section 3.4 will not vest.

3.5 Benefits. Except as the Company may otherwise provide, Executive shall be entitled to participate in any retirement savings plan, profit sharing plan, life insurance, health insurance, dental insurance, disability insurance or any other fringe benefit plan which the Company may from time to time make available to its salaried senior executives to the extent that Executive’s age, tenure, and title make him eligible to receive those benefits. In addition, Executive will be entitled to four weeks paid vacation and access to the Company’s products at the same or similar level as the Company’s other executives similarly situated. Any of such benefits may be modified or withdrawn by the Company in its discretion during the term of this Agreement to the extent the same are withdrawn or modified or supplemented for other executives similarly situated.

3.6 Expenses. The Company shall reimburse Executive for all reasonable expenses properly incurred by Executive in the discharge of Executive’s duties hereunder upon production of evidence therefore.

3.6 Relocation Expenses. The Company will make available to Executive relocation benefits and prerequisites generally provided to the Company’s executive employees pursuant to the policies set forth in the “Relocation Handbook for Arctic Cat Employees,” a copy of which has been provided to Executive. To the extent not otherwise included in the “Relocation Handbook for Arctic Cat Employees,” Executive will also receive a lump-sum net payment of $11,000 to assist with temporary living, residence search, and travel to and from his home in San Clemente, CA. Executive understands and agrees that if he terminates employment with the Company without Good Reason, as defined in Section 5.3 of this Agreement, within one year of his first day of employment with the Company, he shall repay all amounts provided to him under this Section 3.8 within 30 days of termination and that if he terminates employment with the Company without Good Reason, as defined in Section 5.3 of this Agreement, within two years of his first day of employment with the Company he shall repay 50% of all amounts provided to him under this Section 3.8 within 30 days of termination.

ARTICLE IV.

DUTIES OF EXECUTIVE

4.1 Services; Duties. Executive shall have the general duties, responsibilities and authority of a Chief Marketing Officer, subject to the power of the Chief Executive Officer and/or the Board to expand or limit such duties, responsibilities and authority. Executive agrees to loyally perform the duties assigned to Executive from time to time, and all duties associated therewith, to the best of Executive’s abilities, to be familiar with the Company’s policies as they exist from time to time which relate to Executive’s duties, and to abide by the Company’s By-laws, Board direction, and all policies and procedures as they exist from time to time, provided that in the event of a conflict between any Company policy or procedure and the terms of this Agreement, the terms of this Agreement shall control unless contrary to applicable law. While

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the Company employs Executive, Executive will not engage in any business activity or outside employment that might conflict with the Company’s interests or might adversely affect the performance of Executive’s duties for the Company.

4.2 Confidentiality and Good Will. Executive acknowledges that the Company has provided or will provide Executive with information concerning its business, products and customers and that the Company entrusts Executive with business relationships, good will and Confidential Information of great value to the Company. Executive assigns to the Company all good will which Executive has or develops with Customers while employed by the Company. Executive agrees that Executive shall treat all information, business relationships, and good will entrusted to Executive by the Company as a fiduciary, and Executive undertakes all of the obligations of a fiduciary to maintain, protect, and continue to develop such information, business relationships, and good will for the benefit of the Company. All documents and tangible items (including, but not limited to, email) provided to Executive by the Company or created by Executive for use in connection with Executive’s employment are the property of the Company and shall be held by Executive as a fiduciary on behalf of the Company. Upon termination of Executive’s employment for any reason, Executive shall promptly and without the requirement of a prior demand by the Company, return to the Company all such documents and tangible items, together with all copies, recordings, abstracts, notes, reproductions, or electronic versions of any kind made from or about the documents and tangible items or the information they contain. Executive agrees not to directly or indirectly use or disclose any Confidential Information belonging to the Company for the benefit of anyone other than the Company, either during or after employment, for as long as the information remains Confidential Information.

4.3 Non-Solicitation. In recognition of the importance to the Company of its personal relationships, during and for one year following his termination of employment by the Company, for any reason, Executive agrees that he will not directly or indirectly, on his own behalf or on behalf of any other person, solicit: (i) any Customer with whom he had contact during the two years preceding his termination of employment, for the purpose of directly or indirectly (a) marketing, promoting, or encouraging the use of a Competitive Product; (b) providing advice or assistance in connection with the marketing, promotion or use of a Competitive Product; or (c) attempting to interfere with, or preventing or diverting the sale or purchase of products being designed, developed, sold or marketed by the Company; (ii) the services of any person who is a Company employee or agent to terminate his or her employment or agency with the Company; or (iii) any vendor or supplier which provides an exclusive or unique service or product to the Company for the purpose of obtaining similar products or services.

4.4 Non-Competition. Executive agrees that during the period of Executive’s employment with the Company and for one year following the voluntary or involuntary termination of his employment with the Company for any reason, Executive shall not, directly or indirectly, on his own account or in the service of any other person, firm, corporation or other entity, be employed by, or permit his name to be used by, or engage in or carry on business with, or otherwise be associated in any way with, a Conflicting Organization as a partner, shareholder, director, officer, executive, principal, agent, associate, consultant, or in any other capacity. This non-competition covenant is effective in each of the markets in which the Company markets, designs, develops, promotes, sells, services, or provides Company products (i) at any time during

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Executive’s employment with the Company or (ii) at any time within one year following termination of Executive’s employment that were under evaluation with Executive’s knowledge at the time of Executive’s termination of employment.

4.5 Inventions.

(a) Disclosure and Assignment. Executive agrees to promptly disclose in writing to the Company complete information concerning each and every Invention. Executive, to the extent that he has the legal right to do so, hereby acknowledges that any and all Inventions are the exclusive property of the Company and hereby assigns and agrees to assign to the Company any and all of Executive’s right, title and interest in and to any and all Inventions. If an Invention does not relate to the existing or reasonably foreseeable business interests of the Company, the Company may, in its sole and unreviewable discretion, release or license the Invention to Executive upon written request by Executive. No release or license shall be valid unless in writing signed by an officer of the Company.

(b) Future Inventions. As to any future Inventions made by Executive which relate to the business, products or practices of the Company and which are first conceived or reduced to practice during the term of this Agreement, but which are claimed for any reason to belong to an entity or person other than the Company, Executive agrees to promptly disclose the same in writing to the Company and shall not disclose the same to others if the Company, within 20 days thereafter, shall claim ownership of such Inventions under the terms of this Agreement.

(c) Limitation on Sections 4.5(a) and (b). Pursuant to Minnesota Statute Section 181.78, the provisions of Sections 4.5(a) and (b) shall not apply to any Invention meeting the following conditions:

(i) such Invention was developed entirely on Executive’s own time;

(ii) such Invention was made without the use of any Company equipment, supplies, facility or trade secret information;

(iii) such Invention does not relate (a) directly to the business of the Company, or (b) to the Company’s actual or demonstrably anticipated research or development; and

(iv) such Invention does not result from any work performed by Executive for the Company.

(d) Assistance of Executive. Upon request and without further compensation therefor, but at no expense to Executive, and whether during the term of this Agreement or thereafter, Executive will do all lawful acts, including, but not limited to, the execution of papers and lawful oaths and the giving of testimony, that in the opinion of the Company, its successors and assigns, may be necessary or desirable

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in obtaining, sustaining, reissuing, extending and enforcing United States and foreign patents, including, but not limited to, design patents, on any and all of such Inventions, and for perfecting, affirming and recording the Company’s complete ownership and title thereto, and to cooperate otherwise in all proceedings and matters relating thereto.

(e) Records. Executive will keep complete, accurate and authentic accounts, notes, data and records of all Inventions in the manner and form requested by the Company. Such accounts, notes, data and records shall be the property of the Company, and, upon its request, Executive will promptly surrender same to it or, if not previously surrendered upon its request or otherwise, Executive will surrender the same, and all copies thereof, to the Company upon the conclusion of Executive’s employment.

4.6 Understandings. Executive acknowledges and agrees that (a) the Company informed him, as part of the offer of employment and prior to his accepting employment with the Company, that a confidentiality, non-competition, and non-solicitation agreement would be required as part of the terms and conditions of his employment; (b) he has carefully considered the restrictions contained in this Agreement; (c) the restrictions in this Agreement are reasonable and will not unduly restrict him in securing other employment in the event of termination.

4.7 Remedies. Executive agrees and understands that any breach of any of the covenants or agreements set forth in Article IV of this Agreement will cause the Company irreparable harm for which there is no adequate remedy at law, and, without limiting whatever other rights and remedies the Company may have under this Agreement, Executive consents to the issuance of an injunction by any court of competent jurisdiction in favor of the Company enjoining the breach of any of the aforesaid covenants or agreements. If any or all of the aforesaid covenants or agreements are held to be unenforceable because of the scope or duration of such covenant or agreement, the parties agree that the court making such determination shall have the power to reduce or modify the scope and/or duration of such covenant to the extent that allows the maximum scope and/or duration permitted by applicable law.

4.8 Survival. The obligations of this Agreement that require performance by either party after the Term or the expiration or termination of this Agreement, including this Article IV, shall survive the Term and the expiration or termination of this Agreement.

ARTICLE V.

TERMINATION

5.1 Termination for Cause. Notwithstanding anything contained in this Agreement to the contrary, the Company shall have the right to immediately terminate the employment of Executive for “Cause” if the Chief Executive Officer determines that Executive:

(a) willfully or materially breaches this Agreement or any other written agreement with the Company;

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(b) willfully violates or fails to comply with any reasonable rule or policy governing Executive’s performance or behavior, including, without limitation, the prohibition against the use of illegal drugs and the use of alcohol in a way that is materially harmful to the Company’s finances, general reputation, or other legitimate business interest;

(c) willfully violates or fails to comply with any reasonable instruction of the Chief Executive Officer and/or the Board, provided that such instruction is not in violation of this Agreement or any other written agreement between the Company and Executive and is legal;

(d) willfully engages in dishonesty, illegal conduct, or misconduct that is materially harmful to the Company’s finances, general reputation, or other legitimate business interest, as determined by the Board in its sole discretion;

(e) willfully engages in fraud, misappropriation or embezzlement, whether or not related to Executive’s employment with the Company;

(f) willfully and without authorization discloses Confidential Information; or

(g) is convicted of or pleads guilty to any criminal charge or indictment, the nature of which the Board determines, in its sole discretion, may have a detrimental impact on the general reputation of the Company, its finances, or other legitimate business interest.

An act or failure to act is considered “willful” if done or not done with an absence of good faith and without a reasonable belief that the act or failure to act was in the best interests of the Company. In the event of termination for “Cause,” Executive shall not be entitled to any severance payments or any other payments under this Agreement except as may be required by law, but shall receive his Base Salary earned through the date of termination, any unused vacation or other time off earned through the date of termination, reimbursement for reasonable expenses incurred by Executive in the discharge of his duties before termination so long as he provides evidence thereof, and any additional benefits to which he is entitled under any applicable benefit plan of the Company that are not otherwise provided by this Agreement (collectively, the “Accrued Obligations”). Executive shall not be terminated for Cause unless and until Executive has been offered an opportunity to explain the circumstances forming the basis for the Company’s determination of Cause to the Chief Executive Officer except where the Chief Executive Officer determines that doing so would be futile.

5.2 Termination for Any Other Reason. Executive’s employment shall terminate on the occurrence of any one of the following events:

(a) the occurrence of circumstances that make it impossible or impracticable for the business of the Company to be continued;

(b) Executive fails to perform the duties that Executive is reasonably expected to perform under this Agreement to the Company’s satisfaction after notice and opportunity to cure;

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(c) Executive’s death; or

(d) Executive’s Disability unless waived by the Company, where Disability has the meaning set forth in any Company-sponsored disability insurance policy.

In the event of termination of employment for any reason set forth in Section 5.2(b), (c) or (d) above, no further compensation or benefits other than the Accrued Obligations set forth in Section 5.1 of this Agreement and any applicable insurance benefits in accordance with any Company-sponsored insurance policy shall be paid to Executive. Notwithstanding anything contained in this Agreement to the contrary, the Company shall have the right to terminate the employment of Executive for any reason, including reasons other than those described in Sections 5.1 or 5.2. In the event of termination by the Company for any reason not constituting Cause, not described in Section 5.2, and not in connection with a Change in Control, Executive shall be entitled to the severance payments described in Section 5.5. In the event of a Change in Control, the Change in Control Agreement, as amended, shall supersede this Agreement and any understandings between the parties with respect to termination upon such Change in Control and any compensation paid to Executive upon such termination.

5.3 Termination by Executive for Good Reason. Notwithstanding anything contained in this Agreement to the contrary, Executive shall have the right to terminate his employment at any time for “Good Reason.” “Good Reason” exists if any of the following events or conditions occurs:

(a) any material reduction in Executive’s Base Salary unless consistent with the same percentage reduction to the base salaries for other similarly situated senior executives of the Company; or any removal of Executive from the position of, or failure to reappoint or reelect Executive as Chief Marketing Officer of the Company;

(b) any material breach by the Company of any provision of this Agreement;

(c) any purported termination of Executive’s employment which is not made pursuant to a Notice of Termination satisfying the requirements Section 5.6 of this Agreement; or

(d) the relocation of the Company’s principal executive offices to a location more than 50 miles from Minneapolis/St. Paul, Minnesota or the Company requiring Executive to be based more than 50 miles from the Company’s principal executive offices except for requiring travel on the Company’s business.

Prior to any termination for “Good Reason,” Executive must give notice to the Chief Executive Officer of the existence of the condition for “Good Reason” and intent to terminate employment within 90 days of the occurrence of the condition and the Company shall not have

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eliminated the condition within 30 days thereafter. In the event of termination of employment by Executive for Good Reason, Executive shall be entitled to the severance payments described in Section 5.5 of this Agreement subject to the limitations contained in Section 5.5.

5.4 Termination by Executive for Any Other Reason. Executive shall have the right to terminate his employment under this Agreement for any reason. In the event of termination by Executive for any reason not constituting a termination for Good Reason, Executive shall not be entitled to any severance payment or any other payments under this Agreement except the Accrued Obligations described in Section 5.1 of this Agreement.

5.5 Severance Payments. In the event of termination by the Company for any reason not constituting Cause or described in Section 5.2, and not in connection with a Change in Control, or, in the event that Executive terminates Executive’s employment for Good Reason, the Company shall pay to Executive the Accrued Obligations described in Section 5.1 of this Agreement, and, in lieu of any further compensation and benefits under this Agreement, Executive shall be entitled to the following benefits during the 12-month period beginning on the date of such termination of Executive’s employment (the “Severance Period”), subject to the limitations contained in this Section 5.5.

(a) Severance Pay. During the Severance Period, the Company shall pay to Executive an amount equal to his average annual Base Salary (exclusive of any bonuses, incentive compensation or income associated with benefits, restricted stock, or stock options of Executive) over the three year period immediately preceding the date of termination or such lesser period as Executive has been employed by the Company; provided that only the amount permitted by Section 409A of the Code, inclusive of Section 401(a)(17) of the Code, shall be paid in equal portions over the course of the first six months of the Severance Period in accordance with the Company’s regular payroll practices, and the balance shall be paid in equal portions over the course of the remaining six months of the Severance Period in accordance with the Company’s regular payroll practices. Each installment of severance pay shall be considered a separate payment for purposes of Section 409A of the Code.

(b) Benefits During Severance Period. During the Severance Period, the Company shall continue to pay to Executive an amount of cash equal to the Company’s portion of the premium payable under the Company’s group health and life insurance plans for health (i.e., medical, dental and vision benefits) and life insurance benefits provided to the Executive and to those family members covered through Executive under the Company’s group health and life insurance plans immediately prior to the date of termination of employment; provided that if during the Severance Period another employer provides Executive any benefits that are substantially comparable to any of the benefits provided by the Company, the Company’s obligations with respect to such comparable benefits shall cease.

(c) Conditions to Severance Pay. Notwithstanding anything contained in this Agreement to the contrary, Executive shall be entitled to the severance pay and

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benefits described in this Section 5.5 only if (i) on or within 45 days following Executive’s last date of employment Executive signs and does not rescind a release agreement in a form prepared by the Company and given to Executive within 10 days after the date of termination, to include but not be limited to a comprehensive release of all legal claims by Executive in favor of the Company, which release shall be in the form customarily used by the Company for senior executives, (ii) Executive fully complies with his confidentiality obligations under Section 4.2, (iii) Executive fully complies with his non-solicitation obligations under Section 4.3, (iv) Executive fully complies with his non-competition obligations under Section 4.4, and (v) Executive fully complies with his disclosure and assignment obligations under Section 4.5. Executive further understands and agrees that if he does not sign the required release agreement, if he rescinds the required release agreement after signing, or if he does not fully comply with the confidentiality, non-solicitation, non-competition, and/or disclosure and assignment requirements set forth in Sections 4.2, 4.3, 4.4, and 4.5, he will not be entitled to the severance pay or benefits described in this Section 5.5 and will be obligated to return any severance pay and/or benefits already received.

5.6 Notice of Termination. Any purported termination of Executive’s employment by the Company or by Executive shall be communicated by a Notice of Termination sent to the other party in accordance with Section 6.1. For purposes of this Agreement, a “Notice of Termination” shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth a summary of the facts and circumstances claimed to provide a basis for termination of Executive’s employment. No purported termination of Executive’s employment which is not made pursuant to a Notice of Termination shall be effective for purposes of this Agreement.

5.7 Surviving Rights. Notwithstanding the termination of Executive’s employment, the parties shall be required to carry out any provisions which contemplate performance subsequent to such termination; and such termination shall not affect any liability or other obligation which shall have accrued prior to such termination, including, but not limited to, any liability for loss or damage on account of a prior default.

ARTICLE VI.

GENERAL PROVISIONS

6.1 Notices. For the purpose of this Agreement, notices and all other communications provided for shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States first class mail, postage pre-paid, addressed to the last known residence address of Executive or in the case of the Company, to its principal office to the attention of its then Chief Executive Officer, with a copy to its Secretary, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

6.2 Compliance with Section 409A of the Code. If and to the extent that any

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provision of this Agreement is required to comply with Section 409A of the Code, the Company shall have the authority, without the consent of Executive to interpret and/or amend such provision to maintain to the maximum extent practicable the original intent of the applicable provision without violating the provisions of Code 409A.

6.3 No Conflicting Obligations. Executive represents and warrants to the Company that he is not under, or bound to be under in the future, any obligation to any person, firm, or corporation that is or would be inconsistent or in conflict with this Agreement or would prevent, limit, or impair in any way the performance by him of his obligations hereunder.

6.4 Waiver, Modification or Amendment. No waiver, modification or amendment of any term, condition or provision of this Agreement shall be valid or of any effect unless made in writing, signed by the party to be bound or its duly authorized representative and specifying with particularity the nature and extent of such waiver, modification or amendment. Any waiver by any party of any default of the other shall not affect or impair any right arising from any subsequent default. Nothing herein shall limit the rights and remedies of the parties under and pursuant to this Agreement, except as set forth above.

6.5 Entire Agreement. This Agreement contains the entire understanding of the parties in respect of the subject matter hereof and supersedes all prior agreements and understandings between the parties with respect to such subject matter, whether oral or written; provided that the parties acknowledge that they have also entered into a Change in Control Agreement (which has subsequently been amended) and that the Change in Control Agreement, and all amendments thereto shall supersede this Agreement and any understanding between the parties with respect to termination upon a Change in Control and any compensation paid to Executive upon such termination. In all other respects, this Agreement shall remain in full force and effect in the event of a Change in Control.

6.6 Interpretation. The provisions of this Agreement shall be applied and interpreted in a manner consistent with each other so as to carry out the purposes and intent of the parties, but if for any reason any provision of this Agreement is determined to be unenforceable or invalid, such provision or such part thereof as may be unenforceable or invalid shall be deemed severed from this Agreement and the remaining provisions shall be carried out with the same force and effect as if the severed provision or part thereof had not been a part of this Agreement.

6.7 Governing Law; Venue. This Agreement shall be construed and enforced in accordance with the laws of the State of Minnesota. Executive waives Executive’s rights, if any, to have the laws, including conflict of laws principles, of any jurisdiction other than the State of Minnesota apply to this Agreement. Any dispute arising out of or related to Executive’s employment by the Company or arising out of or related to this Agreement, or any breach or alleged breach hereof, shall be exclusively decided by a state or federal court sitting in the State of Minnesota. Executive hereby irrevocably consents to the personal jurisdiction of the state and federal courts sitting in the State of Minnesota for the purposes of any action arising out of or related to Executive’s employment or this Agreement. Executive waives Executive’s right, if any, to have any disputes between Executive and the Company arising out of or related to Executive’s employment or this Agreement decided in any jurisdiction or venue other than a

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state or federal court in the State of Minnesota. Executive agrees not to assist, aid, abet, encourage, or participate in any lawsuit or action by any third party arising out of or related to Executive’s employment or this Agreement in any jurisdiction or venue other than a state or federal court in the State of Minnesota.

6.8 Severability. In the event that any provision of this Agreement is unenforceable under applicable law, that shall not affect the validity or enforceability of the remaining provisions. In the event that any provision of this Agreement is unenforceable because it is overbroad, vague or otherwise, that provision may be revised by a court sitting in the state of Minnesota to the extent required by applicable law, and may be enforced as revised by the court.

6.9 Assignment. Executive acknowledges that Executive’s services are unique and personal. Accordingly, Executive may not assign Executive’s rights or delegate Executive’s duties or obligations under this Agreement. This Agreement shall inure to the benefit of and be enforceable by the Company and any successor or permitted assignee, and may be assigned by the Company to any purchaser of all or substantially all of the Company’s business or assets (by merger, sale of assets, consolidation, acquisition of stock or otherwise) without the consent of Executive, and may otherwise be assigned by the Company only with Executive’s consent.

6.10 Captions and Headings. The captions and section headings used in this Agreement are for convenience of reference only, and shall not affect the construction or interpretation of this Agreement or any of the provisions hereof.

(Signature Page Follows)

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective on the date set forth in the first paragraph of this Agreement.

COMPANY:

ARCTIC CAT INC.

/s/ Christopher T. Metz

Christopher T. Metz

President and Chief Executive Officer

EXECUTIVE:

/s/ Greg Williamson

Greg Williamson

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EX-10.42

Exhibit 10.42

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into this 25th day of February, 2016 by and between Arctic Cat Inc. (the “Company”) and Patricia L. Jones (“Executive”).

WHEREAS, the Company desires to employ Executive on the terms and conditions set forth herein; and

WHEREAS, Executive desires to be employed by the Company on such terms and conditions.

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the sufficiency of which is hereby acknowledged, the parties agree as follows:

ARTICLE I.

DEFINITIONS

1.1 “Arctic Cat Products” means any goods or services designed, developed, marketed, promoted, sold, serviced, or provided on behalf of the Company during the last two years in which Executive was employed by the Company.

1.2 “Change in Control” has the same meaning as defined in that certain Change in Control Agreement of even or substantially even date of the Original Employment Agreement (the “Change in Control Agreement”), as such Change in Control Agreement may be amended from time to time.

1.3 “Code” means the Internal Revenue Code of 1986, as amended.

1.4 “Company” means Arctic Cat Inc. and all of its subsidiary and affiliated entities and their divisions which now exist or may exist in the future.

1.5 “Competitive Products” means any product, product line or service (including any component thereof or research to develop information useful in connection with a product or service) that is being designed, developed, manufactured, marketed, or sold by the Company, or with respect to which the Company has acquired Confidential Information which it intends to use in the design, development, manufacture, marketing, or sale of a product or service.

1.6 “Confidential Information” means any information or compilation of information that Executive learns or develops during the course of Executive’s employment by the Company that derives independent economic value from not being generally known, or readily ascertainable by proper means, by other persons who can obtain economic value from its disclosure or use. Confidential Information includes, but is not limited to, trade secrets and may relate to such matters as research and development, engineering, drawings and specifications, strategic plans, business methods, non-public financial information, proprietary information pertaining to vendors and customers, product improvement efforts, manufacturing processes,

management systems, sales and marketing plans and information, contracts, and pricing.

1.7 “Conflicting Organization” means any person or entity (regardless of its legal form) which is engaged in, or about to become engaged in, research or development, production, marketing or selling a Competitive Product, including Executive if Executive is engaged in business for herself.

1.8 “Customer” means any person or entity (regardless of its legal form) with whom or with which Executive or those under Executive’s direct or indirect supervision had any direct or indirect contact on behalf of the Company in connection with Arctic Cat Products. Without limiting the generality of the foregoing, the term Customer includes, but is not limited to, dealers, vendors, suppliers, and sponsors.

1.9 “Disability” has two different meanings in this Agreement. For purposes of benefits due under any Company-sponsored disability insurance policy (whether short-term, long-term, or any applicable salary continuation policy provided during any elimination period), the definition of Disability shall conform to the definition provided in such policy. For purposes of any payment made to Executive in excess of the benefits due under any such Company- sponsored disability insurance policy, the definition of Disability shall be at least as restrictive as the applicable definition provided in Section 409A of the Code.

1.10 “Invention” means all inventions, discoveries, ideas, processes, writings, designs, developments, and improvements, whether or not protectable under the applicable patent, trademark or copyright statutes, of Executive while employed by the Company.

ARTICLE II.

EMPLOYMENT AND TERM

2.1 Employment. Upon the terms and subject to the conditions set forth in this Agreement and effective upon commencement of the term set forth in Section 2.2 below, the Company hereby employs Executive as Vice President and Chief Human Resource Officer or in such other capacity as may be determined from time to time by the Company’s Chief Executive Officer or Board of Directors (the “Board”), and Executive hereby accepts such employment.

2.2 Term. The term of this Agreement shall commence on March 28, 2016 and shall continue until this Agreement is terminated by either party pursuant to the terms hereof.

ARTICLE III.

COMPENSATION

3.1 Base Salary. As compensation for Executive’s services to the Company and as consideration for the confidentiality, non-competition and non-solicitation agreements provided in Article IV of this Agreement, Executive shall receive an annual base salary in the amount of Two Hundred Eighty-five Thousand Dollars ($285,000) payable in accordance with the Company’s regular payroll processes (the “Base Salary”) and the additional compensation set forth in this Agreement. Executive’s Base Salary shall be reviewed by the Compensation and/or

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Human Resources Committee of the Board on an annual basis, beginning in May 2017, and such committee may, but is not be obligated to, adjust Executive’s Base Salary by an amount as it deems appropriate based on a review of certain benchmarking information, including but not limited to, general industry as well as industry specific and other peer company compensation data, as well as recommendations from the Chief Executive Officer.

3.2 Annual Incentive Awards. In addition to the Base Salary, starting with the fiscal year that begins April 1, 2016 (“Fiscal 2017”) Executive shall be eligible to participate in the Company’s annual incentive program offered to the Company’s senior executives. Executive’s annual incentive payout shall range from zero percent (0%) to two hundred percent (200%) of Executive’s target incentive payout (the “Annual Bonus”). The target incentive payout (the “Target Bonus”) for Executive for Fiscal 2017 shall be forty percent (40%) of Executive’s Base Salary. Thereafter, the Board, or an appropriate committee of the Board, may, but is not obligated to, adjust Executive’s Target Bonus as it deems appropriate and consistent with the Company’s then existing annual incentive program. Payouts made pursuant to this Section 3.2 shall be paid no later than two and a half (2.5) months after the end of the Company’s fiscal year or as soon thereafter as practicable.

3.3 Long-Term Incentive Compensation. In addition to Base Salary and all other compensation provided in this Agreement, Executive shall be entitled to participate in the Company’s long-term incentive program (the “LTI”) beginning in Fiscal 2017. The Board has approved and will issue grants to Executive of stock options to purchase shares of common stock and shares of restricted stock units (“RSUs”) at the same time as similarly situated Executive Officers. The stock options will have a fair market value at the end of the first day of Executive’s employment of $ 89,375.00 (at an assumed Black-Scholes ratio of 40%) and the RSUs will have a fair market value of $ 89,375.00 at the end of the first day of Executive’s employment. The grants are made in accordance with the Company’s 2013 Omnibus Stock and Incentive Plan. The grants will vest in equal installments on the first, second and third anniversaries of the grant date.

3.4 Benefits. Except as the Company may otherwise provide, Executive shall be entitled to participate in any retirement savings plan, profit sharing plan, life insurance, health insurance, dental insurance, disability insurance or any other fringe benefit plan which the Company may from time to time make available to its salaried senior executives to the extent that Executive’s age, tenure, and title make Executive eligible to receive those benefits. In addition, Executive will be entitled to four weeks paid vacation and access to the Company’s products at the same or similar level as the Company’s other executives similarly situated. Any of such benefits may be modified or withdrawn by the Company in its discretion during the term of this Agreement to the extent the same are withdrawn or modified or supplemented for other executives similarly situated.

3.5 Expenses. The Company shall reimburse Executive for all reasonable expenses properly incurred by Executive in the discharge of Executive’s duties hereunder upon production of evidence therefore.

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ARTICLE IV.

DUTIES OF EXECUTIVE

4.1 Services; Duties. Executive shall have the general duties, responsibilities and authority of a Vice President and Chief Human Resource Officer subject to the power of the Chief Executive Officer and/or the Board to expand or limit such duties, responsibilities and authority. Executive agrees to loyally perform the duties assigned to Executive from time to time, and all duties associated therewith, to the best of Executive’s abilities, to be familiar with the Company’s policies as they exist from time to time which relate to Executive’s duties, and to abide by the Company’s Bylaws, Board direction, and all policies and procedures as they exist from time to time, provided that in the event of a conflict between any Company policy or procedure and the terms of this Agreement, the terms of this Agreement shall control unless contrary to applicable law. While the Company employs Executive, Executive will not engage in any business activity or outside employment that might conflict with the Company’s interests or might adversely affect the performance of Executive’s duties for the Company.

4.2 Confidentiality and Good Will. Executive acknowledges that the Company has provided or will provide Executive with information concerning its business, products and customers and that the Company entrusts Executive with business relationships, good will and Confidential Information of great value to the Company. Executive assigns to the Company all good will which Executive has or develops with Customers while employed by the Company. Executive agrees that Executive shall treat all information, business relationships, and good will entrusted to Executive by the Company as a fiduciary, and Executive undertakes all of the obligations of a fiduciary to maintain, protect, and continue to develop such information, business relationships, and good will for the benefit of the Company. All documents and tangible items (including, but not limited to, email) provided to Executive by the Company or created by Executive for use in connection with Executive’s employment are the property of the Company and shall be held by Executive as a fiduciary on behalf of the Company. Upon termination of Executive’s employment for any reason, Executive shall promptly and without the requirement of a prior demand by the Company, return to the Company all such documents and tangible items, together with all copies, recordings, abstracts, notes, reproductions, or electronic versions of any kind made from or about the documents and tangible items or the information they contain. Executive agrees not to directly or indirectly use or disclose any Confidential Information belonging to the Company for the benefit of anyone other than the Company, either during or after employment, for as long as the information remains Confidential Information.

4.3 Non-Solicitation. In recognition of the importance to the Company of its personal relationships, during and for one year following Executive’s termination of employment by the Company, for any reason, Executive agrees that Executive will not directly or indirectly, on Executive’s own behalf or on behalf of any other person, solicit: (i) any Customer with whom Executive had contact during the two years preceding Executive’s termination of employment, for the purpose of directly or indirectly (a) marketing, promoting, or encouraging the use of a Competitive Product; (b) providing advice or assistance in connection with the marketing, promotion or use of a Competitive Product; or (c) attempting to interfere with, or preventing or diverting the sale or purchase of products being designed, developed, sold or marketed by the Company; (ii) the services of any person who is a Company employee or agent to terminate

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Executive’s or her employment or agency with the Company; or (iii) any vendor or supplier which provides an exclusive or unique service or product to the Company for the purpose of obtaining similar products or services.

4.4 Non-Competition. Executive agrees that during the period of Executive’s employment with the Company and for one year following the voluntary or involuntary termination of Executive’s employment with the Company for any reason, Executive shall not, directly or indirectly, on Executive’s own account or in the service of any other person, firm, corporation or other entity, be employed by, or permit Executive’s name to be used by, or engage in or carry on business with, or otherwise be associated in any way with, a Conflicting Organization as a partner, shareholder, director, officer, executive, principal, agent, associate, consultant, or in any other capacity. This non-competition covenant is effective in each of the markets in which the Company markets, designs, develops, promotes, sells, services, or provides Company products (i) at any time during Executive’s employment with the Company or (ii) at any time within one year following termination of Executive’s employment that were under evaluation with Executive’s knowledge at the time of Executive’s termination of employment.

4.5 Inventions.

(a) Disclosure and Assignment. Executive agrees to promptly disclose in writing to the Company complete information concerning each and every Invention. Executive, to the extent that Executive has the legal right to do so, hereby acknowledges that any and all Inventions are the exclusive property of the Company and hereby assigns and agrees to assign to the Company any and all of Executive’s right, title and interest in and to any and all Inventions. If an Invention does not relate to the existing or reasonably foreseeable business interests of the Company, the Company may, in its sole and unreviewable discretion, release or license the Invention to Executive upon written request by Executive. No release or license shall be valid unless in writing signed by an officer of the Company.

(b) Future Inventions. As to any future Inventions made by Executive which relate to the business, products or practices of the Company and which are first conceived or reduced to practice during the term of this Agreement, but which are claimed for any reason to belong to an entity or person other than the Company, Executive agrees to promptly disclose the same in writing to the Company and shall not disclose the same to others if the Company, within 20 days thereafter, shall claim ownership of such Inventions under the terms of this Agreement.

(c) Limitation on Sections 4.5(a) and (b). Pursuant to Minnesota Statute Section 181.78, the provisions of Sections 4.5(a) and (b) shall not apply to any Invention meeting the following conditions:

(i) such Invention was developed entirely on Executive’s own time;

(ii) such Invention was made without the use of any Company equipment,

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supplies, facility or trade secret information;

(iii) such Invention does not relate (a) directly to the business of the Company, or (b) to the Company’s actual or demonstrably anticipated research or development; and

(iv) such Invention does not result from any work performed by Executive for the Company.

(d) Assistance of Executive. Upon request and without further compensation therefor, but at no expense to Executive, and whether during the term of this Agreement or thereafter, Executive will do all lawful acts, including, but not limited to, the execution of papers and lawful oaths and the giving of testimony, that in the opinion of the Company, its successors and assigns, may be necessary or desirable in obtaining, sustaining, reissuing, extending and enforcing United States and foreign patents, including, but not limited to, design patents, on any and all of such Inventions, and for perfecting, affirming and recording the Company’s complete ownership and title thereto, and to cooperate otherwise in all proceedings and matters relating thereto.

(e) Records. Executive will keep complete, accurate and authentic accounts, notes, data and records of all Inventions in the manner and form requested by the Company. Such accounts, notes, data and records shall be the property of the Company, and, upon its request, Executive will promptly surrender same to it or, if not previously surrendered upon its request or otherwise, Executive will surrender the same, and all copies thereof, to the Company upon the conclusion of Executive’s employment.

4.6 Understandings. Executive acknowledges and agrees that (a) the Company informed Executive, as part of the offer of employment and prior to Executive’s accepting employment with the Company, that a confidentiality, non-competition, and non-solicitation agreement would be required as part of the terms and conditions of Executive’s employment; (b) Executive has carefully considered the restrictions contained in this Agreement; (c) the restrictions in this Agreement are reasonable and will not unduly restrict Executive in securing other employment in the event of termination.

4.7 Remedies. Executive agrees and understands that any breach of any of the covenants or agreements set forth in Article IV of this Agreement will cause the Company irreparable harm for which there is no adequate remedy at law, and, without limiting whatever other rights and remedies the Company may have under this Agreement, Executive consents to the issuance of an injunction by any court of competent jurisdiction in favor of the Company enjoining the breach of any of the aforesaid covenants or agreements. If any or all of the aforesaid covenants or agreements are held to be unenforceable because of the scope or duration of such covenant or agreement, the parties agree that the court making such determination shall have the power to reduce or modify the scope and/or duration of such covenant to the extent that allows the maximum scope and/or duration permitted by applicable law.

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4.8 Survival. The obligations of this Agreement that require performance by either party after the Term or the expiration or termination of this Agreement, including this Article IV, shall survive the Term and the expiration or termination of this Agreement.

ARTICLE V.

TERMINATION

5.1 Termination for Cause. Notwithstanding anything contained in this Agreement to the contrary, the Company shall have the right to immediately terminate the employment of Executive for “Cause” if the Chief Executive Officer determines that Executive:

(a) willfully or materially breaches this Agreement or any other written agreement with the Company;

(b) willfully violates or fails to comply with any reasonable rule or policy governing Executive’s performance or behavior, including, without limitation, the prohibition against the use of illegal drugs and the use of alcohol in a way that is materially harmful to the Company’s finances, general reputation, or other legitimate business interest;

(c) willfully violates or fails to comply with any reasonable instruction of the Chief Executive Officer and/or the Board, provided that such instruction is not in violation of this Agreement or any other written agreement between the Company and Executive and is legal;

(d) willfully engages in dishonesty, illegal conduct, or misconduct that is materially harmful to the Company’s finances, general reputation, or other legitimate business interest, as determined by the Board in its sole discretion;

(e) willfully engages in fraud, misappropriation or embezzlement, whether or not related to Executive’s employment with the Company;

(f) willfully and without authorization discloses Confidential Information; or

(g) is convicted of or pleads guilty to any criminal charge or indictment, the nature of which the Board determines, in its sole discretion, may have a detrimental impact on the general reputation of the Company, its finances, or other legitimate business interest.

An act or failure to act is considered “willful” if done or not done with an absence of good faith and without a reasonable belief that the act or failure to act was in the best interests of the Company. In the event of termination for “Cause,” Executive shall not be entitled to any severance payments or any other payments under this Agreement except as may be required by law, but shall receive Executive’s Base Salary earned through the date of termination, any unused vacation or other time off earned through the date of termination, reimbursement for

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reasonable expenses incurred by Executive in the discharge of Executive’s duties before termination so long as Executive provides evidence thereof, and any additional benefits to which Executive is entitled under any applicable benefit plan of the Company that are not otherwise provided by this Agreement (collectively, the “Accrued Obligations”). Executive shall not be terminated for Cause unless and until Executive has been offered an opportunity to explain the circumstances forming the basis for the Company’s determination of Cause to the Chief Executive Officer except where the Chief Executive Officer determines that doing so would be futile.

5.2 Termination for Any Other Reason. Executive’s employment shall terminate on the occurrence of any one of the following events:

(a) the occurrence of circumstances that make it impossible or impracticable for the business of the Company to be continued;

(b) Executive fails to perform the duties that Executive is reasonably expected to perform under this Agreement to the Company’s satisfaction after notice and opportunity to cure;

(c) Executive’s death; or

(d) Executive’s Disability unless waived by the Company, where Disability has the meaning set forth in any Company-sponsored disability insurance policy.

In the event of termination of employment for any reason set forth in Section 5.2(b), (c) or (d) above, no further compensation or benefits other than the Accrued Obligations set forth in Section 5.1 of this Agreement and any applicable insurance benefits in accordance with any Company-sponsored insurance policy shall be paid to Executive. Notwithstanding anything contained in this Agreement to the contrary, the Company shall have the right to terminate the employment of Executive for any reason, including reasons other than those described in Sections 5.1 or 5.2. In the event of termination by the Company for any reason not constituting Cause, not described in Section 5.2, and not in connection with a Change in Control, Executive shall be entitled to the severance payments described in Section 5.5. In the event of a Change in Control, the Change in Control Agreement, as amended, shall supersede this Agreement and any understandings between the parties with respect to termination upon such Change in Control and any compensation paid to Executive upon such termination.

5.3 Termination by Executive for Good Reason. Notwithstanding anything contained in this Agreement to the contrary, Executive shall have the right to terminate Executive’s employment at any time for “Good Reason.” “Good Reason” exists if any of the following events or conditions occurs:

(a) any material reduction in Executive’s Base Salary unless consistent with the same percentage reduction to the base salaries for other similarly situated senior executives of the Company; or any removal of Executive from the position of, or failure to reappoint or reelect Executive as Vice President and Chief Human

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Resource Officer of the Company;

(b) any material breach by the Company of any provision of this Agreement;

(c) any purported termination of Executive’s employment which is not made pursuant to a Notice of Termination satisfying the requirements Section 5.6 of this Agreement; or

(d) the relocation of the Company’s principal executive offices to a location more than 50 miles from Minneapolis/St. Paul, Minnesota or the Company requiring Executive to be based more than 50 miles from the Company’s principal executive offices except for requiring travel on the Company’s business.

Prior to any termination for “Good Reason,” Executive must give notice to the Chief Executive Officer of the existence of the condition for “Good Reason” and intent to terminate employment within 90 days of the occurrence of the condition and the Company shall not have eliminated the condition within 30 days thereafter. In the event of termination of employment by Executive for Good Reason, Executive shall be entitled to the severance payments described in Section 5.5 of this Agreement subject to the limitations contained in Section 5.5.

5.4 Termination by Executive for Any Other Reason. Executive shall have the right to terminate Executive’s employment under this Agreement for any reason. In the event of termination by Executive for any reason not constituting a termination for Good Reason, Executive shall not be entitled to any severance payment or any other payments under this Agreement except the Accrued Obligations described in Section 5.1 of this Agreement.

5.5 Severance Payments. In the event of termination by the Company for any reason not constituting Cause or described in Section 5.2, and not in connection with a Change in Control, or, in the event that Executive terminates Executive’s employment for Good Reason, the Company shall pay to Executive the Accrued Obligations described in Section 5.1 of this Agreement, and, in lieu of any further compensation and benefits under this Agreement, Executive shall be entitled to the following benefits during the 12-month period beginning on the date of such termination of Executive’s employment (the “Severance Period”), subject to the limitations contained in this Section 5.5.

(a) Severance Pay. During the Severance Period, the Company shall pay to Executive an amount equal to Executive’s average annual Base Salary (exclusive of any bonuses, incentive compensation or income associated with benefits, restricted stock, or stock options of Executive) over the three year period immediately preceding the date of termination or such lesser period as Executive has been employed by the Company; provided that only the amount permitted by Section 409A of the Code, inclusive of Section 401(a)(17) of the Code, shall be paid in equal portions over the course of the first six months of the Severance Period in accordance with the Company’s regular payroll practices, and the balance shall be paid in equal portions over the course of the remaining six months of the Severance Period in accordance with the Company’s regular

- 9 -

payroll practices. Each installment of severance pay shall be considered a separate payment for purposes of Section 409A of the Code.

(b) Benefits During Severance Period. During the Severance Period, the Company shall continue to pay to Executive an amount of cash equal to the Company’s portion of the premium payable under the Company’s group health and life insurance plans for health (i.e., medical, dental and vision benefits) and life insurance benefits provided to the Executive and to those family members covered through Executive under the Company’s group health and life insurance plans immediately prior to the date of termination of employment; provided that if during the Severance Period another employer provides Executive any benefits that are substantially comparable to any of the benefits provided by the Company, the Company’s obligations with respect to such comparable benefits shall cease.

(c) Conditions to Severance Pay. Notwithstanding anything contained in this Agreement to the contrary, Executive shall be entitled to the severance pay and benefits described in this Section 5.5 only if (i) on or within 45 days following Executive’s last date of employment Executive signs and does not rescind a release agreement in a form prepared by the Company and given to Executive within 10 days after the date of termination, to include but not be limited to a comprehensive release of all legal claims by Executive in favor of the Company, which release shall be in the form customarily used by the Company for senior executives, (ii) Executive fully complies with Executive’s confidentiality obligations under Section 4.2, (iii) Executive fully complies with Executive’s non-solicitation obligations under Section 4.3, (iv) Executive fully complies with Executive’s non-competition obligations under Section 4.4, and (v) Executive fully complies with Executive’s disclosure and assignment obligations under Section 4.5. Executive further understands and agrees that if Executive does not sign the required release agreement, if Executive rescinds the required release agreement after signing, or if Executive does not fully comply with the confidentiality, non-solicitation, non-competition, and/or disclosure and assignment requirements set forth in Sections 4.2, 4.3, 4.4, and 4.5, he will not be entitled to the severance pay or benefits described in this Section 5.5 and will be obligated to return any severance pay and/or benefits already received.

5.6 Notice of Termination. Any purported termination of Executive’s employment by the Company or by Executive shall be communicated by a Notice of Termination sent to the other party in accordance with Section 6.1. For purposes of this Agreement, a “Notice of Termination” shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon and shall set forth a summary of the facts and circumstances claimed to provide a basis for termination of Executive’s employment. No purported termination of Executive’s employment which is not made pursuant to a Notice of Termination shall be effective for purposes of this Agreement.

5.7 Surviving Rights. Notwithstanding the termination of Executive’s employment, the parties shall be required to carry out any provisions which contemplate performance

- 10 -

subsequent to such termination; and such termination shall not affect any liability or other obligation which shall have accrued prior to such termination, including, but not limited to, any liability for loss or damage on account of a prior default.

ARTICLE VI.

GENERAL PROVISIONS

6.1 Notices. For the purpose of this Agreement, notices and all other communications provided for shall be in writing and shall be deemed to have been duly given when delivered or mailed by United States first class mail, postage pre-paid, addressed to the last known residence address of Executive or in the case of the Company, to its principal office to the attention of its then Chief Executive Officer, with a copy to its Secretary, or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notice of change of address shall be effective only upon receipt.

6.2 Compliance with Section 409A of the Code. If and to the extent that any provision of this Agreement is required to comply with Section 409A of the Code, the Company shall have the authority, without the consent of Executive to interpret and/or amend such provision to maintain to the maximum extent practicable the original intent of the applicable provision without violating the provisions of Code 409A.

6.3 No Conflicting Obligations. Executive represents and warrants to the Company that he is not under, or bound to be under in the future, any obligation to any person, firm, or corporation that is or would be inconsistent or in conflict with this Agreement or would prevent, limit, or impair in any way the performance by Executive of Executive’s obligations hereunder.

6.4 Waiver, Modification or Amendment. No waiver, modification or amendment of any term, condition or provision of this Agreement shall be valid or of any effect unless made in writing, signed by the party to be bound or its duly authorized representative and specifying with particularity the nature and extent of such waiver, modification or amendment. Any waiver by any party of any default of the other shall not affect or impair any right arising from any subsequent default. Nothing herein shall limit the rights and remedies of the parties under and pursuant to this Agreement, except as set forth above.

6.5 Entire Agreement. This Agreement contains the entire understanding of the parties in respect of the subject matter hereof and supersedes all prior agreements and understandings between the parties with respect to such subject matter, whether oral or written; provided that the parties acknowledge that they have also entered into a Change in Control Agreement (which has subsequently been amended) and that the Change in Control Agreement, and all amendments thereto shall supersede this Agreement and any understanding between the parties with respect to termination upon a Change in Control and any compensation paid to Executive upon such termination. In all other respects, this Agreement shall remain in full force and effect in the event of a Change in Control.

6.6 Interpretation. The provisions of this Agreement shall be applied and interpreted in a manner consistent with each other so as to carry out the purposes and intent of the parties,

- 11 -

but if for any reason any provision of this Agreement is determined to be unenforceable or invalid, such provision or such part thereof as may be unenforceable or invalid shall be deemed severed from this Agreement and the remaining provisions shall be carried out with the same force and effect as if the severed provision or part thereof had not been a part of this Agreement.

6.7 Governing Law; Venue. This Agreement shall be construed and enforced in accordance with the laws of the State of Minnesota. Executive waives Executive’s rights, if any, to have the laws, including conflict of laws principles, of any jurisdiction other than the State of Minnesota apply to this Agreement. Any dispute arising out of or related to Executive’s employment by the Company or arising out of or related to this Agreement, or any breach or alleged breach hereof, shall be exclusively decided by a state or federal court sitting in the State of Minnesota. Executive hereby irrevocably consents to the personal jurisdiction of the state and federal courts sitting in the State of Minnesota for the purposes of any action arising out of or related to Executive’s employment or this Agreement. Executive waives Executive’s right, if any, to have any disputes between Executive and the Company arising out of or related to Executive’s employment or this Agreement decided in any jurisdiction or venue other than a state or federal court in the State of Minnesota. Executive agrees not to assist, aid, abet, encourage, or participate in any lawsuit or action by any third party arising out of or related to Executive’s employment or this Agreement in any jurisdiction or venue other than a state or federal court in the State of Minnesota.

6.8 Severability. In the event that any provision of this Agreement is unenforceable under applicable law, that shall not affect the validity or enforceability of the remaining provisions. In the event that any provision of this Agreement is unenforceable because it is overbroad, vague or otherwise, that provision may be revised by a court sitting in the state of Minnesota to the extent required by applicable law, and may be enforced as revised by the court.

6.9 Assignment. Executive acknowledges that Executive’s services are unique and personal. Accordingly, Executive may not assign Executive’s rights or delegate Executive’s duties or obligations under this Agreement. This Agreement shall inure to the benefit of and be enforceable by the Company and any successor or permitted assignee, and may be assigned by the Company to any purchaser of all or substantially all of the Company’s business or assets (by merger, sale of assets, consolidation, acquisition of stock or otherwise) without the consent of Executive, and may otherwise be assigned by the Company only with Executive’s consent.

6.10 Captions and Headings. The captions and section headings used in this Agreement are for convenience of reference only, and shall not affect the construction or interpretation of this Agreement or any of the provisions hereof.

(Signature Page Follows)

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective on the date set forth in the first paragraph of this Agreement.

COMPANY:

ARCTIC CAT INC.

/s/ Christopher T. Metz

Christopher T. Metz

President and Chief Executive Officer

EXECUTIVE:

/s/ Patricia L. Jones

Patricia L. Jones

- 13 -

EX-21.1

EXHIBIT 21.1

ARCTIC CAT INC.

Subsidiaries of the Company as of March 31, 2016 (all of which are 100% owned, directly or indirectly, by the Company)

Name of Subsidiary	State or Other Jurisdiction of Incorporation or Organization
Arctic Cat Production LLC	Minnesota
Arctic Cat Production Support LLC	Minnesota
Arctic Cat Shared Services LLC	Minnesota
Arctic Cat Sales Inc.	Minnesota
MotorFist, LLC	Minnesota
Arctic Cat ACE Holding GmbH	Austria
Arctic Cat GmbH	Austria
Arctic Cat Deutschland GmbH	Germany
Arctic Cat Espana S.L.	Spain
Arctic Cat France SARL	France
Arctic Cat Italia S.r.l.	Italy
Arctic Cat UK Ltd	United Kingdom

EX-23.1

EXHIBIT 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We have issued our reports dated May 27, 2016, with respect to the consolidated financial statements and internal control over financial reporting included in the Annual Report of Arctic Cat Inc. and subsidiaries on Form 10-K for the year ended March 31, 2016. We consent to the incorporation by reference of said reports in the Registration Statements of Arctic Cat Inc. on Forms S-8 (File No. 333-99253, File No. 333-145784, File No. 333-163209, File No. 333-192195 and File No. 333-200680).

/s/ GRANT THORNTON LLP

Minneapolis, Minnesota

May 27, 2016

EX-31.1

EXHIBIT 31.1

302 CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Christopher T. Metz, certify that:

1. I have reviewed this Annual Report on Form 10-K of Arctic Cat Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:     May 27, 2016	By:	/s/ CHRISTOPHER T. METZ
		Christopher T. Metz President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

302 CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Christopher J. Eperjesy, certify that:

1. I have reviewed this Annual Report on Form 10-K of Arctic Cat Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:     May 27, 2016	By:	/s/ CHRISTOPHER J. EPERJESY
		Christopher J. Eperjesy Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to 18U.S.C. Section 1350, as Adopted Pursuant to Section 906

of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U.S.C. §1350 (as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002), I, Christopher T. Metz, the Chief Executive Officer of Arctic Cat Inc. (the “Company”), hereby certify that the Annual Report on Form 10-K of the Company for the year ended March 31, 2016 (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

Date:    May 27, 2016	By:	/s/ CHRISTOPHER T. METZ
		Christopher T. Metz President and Chief Executive Officer

EX-32.2

Exhibit 32.2

Certification Pursuant to 18U.S.C. Section 1350, as Adopted Pursuant to Section 906

of the Sarbanes-Oxley Act of 2002

Pursuant to 18 U.S.C. §1350 (as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002), I, Christopher J. Eperjesy, the Chief Financial Officer of Arctic Cat Inc. (the “Company”), hereby certify that the Annual Report on Form 10-K of the Company for the year ended March 31, 2016 (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the SEC or its staff upon request.

Date:     May 27, 2016	By:	/s/ CHRISTOPHER J. EPERJESY
		Christopher J. Eperjesy Chief Financial Officer

XML

Document and Entity Information - USD ($)	12 Months Ended
	Mar. 31, 2016	May. 20, 2016	Sep. 30, 2015
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Mar. 31, 2016
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	FY
Trading Symbol	ACAT
Entity Registrant Name	ARCTIC CAT INC
Entity Central Index Key	0000719866
Current Fiscal Year End Date	--03-31
Entity Well-known Seasoned Issuer	No
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		13,052,843
Entity Public Float			$ 287,993,615

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015
Current assets
Cash and cash equivalents	$ 17,730	$ 40,253
Short-term investments		1,009
Accounts receivable, less allowances	35,760	25,067
Inventories	140,007	152,443
Prepaid expenses	6,456	5,363
Income taxes receivable	11,765	5,151
Deferred income taxes	17,229	13,050
Other current assets	100	3,628
Total current assets	229,047	245,964
Property and equipment
Machinery, equipment and tooling	214,372	194,074
Land, buildings and improvements	33,259	30,004
Property, Plant and Equipment, Gross, Total	247,631	224,078
Less accumulated depreciation	166,144	161,210
Property, Plant and Equipment, Net, Total	81,487	62,868
Goodwill	3,342	3,342
Intangible assets, net	2,855	3,237
Other assets	1,163
Assets, Total	317,894	315,411
Current liabilities
Accounts payable	72,012	70,257
Accrued expenses:
Marketing	9,087	14,495
Compensation	5,634	4,429
Warranties	24,809	23,062
Insurance	3,538	4,383
Other	8,950	5,463
Total current liabilities	124,030	122,089
Deferred income taxes	13,193	9,716
Other liabilities	$ 13,280	$ 3,234
Commitments and contingencies
Shareholders' equity
Preferred stock
Common stock, par value $.01; 37,440,000 shares authorized; shares issued and outstanding: 13,038,249 at March 31, 2016 and 12,949,702 at March 31, 2015	$ 130	$ 130
Additional paid-in-capital	6,105	1,940
Accumulated other comprehensive loss	(10,184)	(7,142)
Retained earnings	171,340	185,444
Total shareholders' equity	167,391	180,372
Liabilities and Equity, Total	$ 317,894	$ 315,411
Preferred Stock - Series B Junior Participating
Shareholders' equity
Preferred stock

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2016	Mar. 31, 2015
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	2,050,000	2,050,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	37,440,000	37,440,000
Common stock, shares issued	13,038,249	12,949,702
Common stock, shares outstanding	13,038,249	12,949,702
Preferred Stock - Series B Junior Participating
Preferred stock, par value	$ 1.00	$ 1.00
Preferred stock, shares authorized	450,000	450,000
Preferred stock, shares issued	0	0

XML

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Net sales
Net sales	$ 632,895	$ 698,756	$ 730,491
Cost of goods sold
Cost of goods sold	542,228	579,307	579,412
Gross profit	90,667	119,449	151,079
Operating expenses
Selling and marketing	43,714	39,656	38,028
Research and development	27,162	24,341	23,998
General and administrative	36,005	48,914	28,557
Total operating expenses	106,881	112,911	90,583
Operating profit (loss)	(16,214)	6,538	60,496
Other income (expense)
Interest income	15	25	30
Interest expense	(848)	(353)	(122)
Total other expense	(833)	(328)	(92)
Earnings (loss) before income taxes	(17,047)	6,210	60,404
Income tax expense (benefit)	(7,860)	1,290	21,000
Net earnings (loss)	$ (9,187)	$ 4,920	$ 39,404
Net earnings (loss) per share
Basic	$ (0.71)	$ 0.38	$ 2.97
Diluted	$ (0.71)	$ 0.38	$ 2.90
Weighted average shares outstanding
Basic	12,995	12,926	13,275
Diluted	12,995	13,089	13,598
Snowmobile and ATV/ROV units
Net sales
Net sales	$ 534,600	$ 584,873	$ 615,608
Cost of goods sold
Cost of goods sold	476,194	505,383	506,707
Gross profit	58,406	79,490	108,901
Parts, garments and accessories
Net sales
Net sales	98,295	113,883	114,883
Cost of goods sold
Cost of goods sold	66,034	73,924	72,705
Gross profit	$ 32,261	$ 39,959	$ 42,178

XML

Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Statement of Comprehensive Income [Abstract]
Net earnings (loss)	$ (9,187)	$ 4,920	$ 39,404
Other comprehensive income (loss):
Foreign currency translation adjustments	1,387	(7,311)	2,297
Unrealized gain (loss) on derivative instruments, net of tax	(4,429)	2,279	(241)
Comprehensive income (loss)	$ (12,229)	$ (112)	$ 41,460

XML

Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings
Balances at Mar. 31, 2013	$ 174,472	$ 132	$ 10,945	$ (4,166)	$ 167,561
Balances, Shares at Mar. 31, 2013		13,204
Exercise of stock options	9,707	$ 6	9,701
Exercise of stock options, Shares		617
Tax benefits from stock options exercised	7,499		7,499
Repurchase of common stock	(45,362)	$ (9)	(30,729)		(14,624)
Repurchase of common stock, Shares		(959)
Restricted stock awards and units, Shares		21
Stock-based compensation expense	2,584		2,584
Net earnings (loss)	39,404				39,404
Unrealized gain (loss) on derivative instruments, net of tax	(241)			(241)
Foreign currency adjustment	2,297			2,297
Dividends ($0.40 in March 31, 2014, $0.50 in March 31, 2015 and $0.38 in March 31, 2016 per share)	(5,317)				(5,317)
Balances at Mar. 31, 2014	185,043	$ 129		(2,110)	187,024
Balances, shares at Mar. 31, 2014		12,883
Exercise of stock options	1,452	$ 1	1,451
Exercise of stock options, Shares		95
Tax benefits from stock options exercised	287		287
Repurchase of common stock	(3,159)	$ (1)	(3,158)
Repurchase of common stock, Shares		(83)
Restricted stock awards and units	(726)	$ 1	(727)
Restricted stock awards and units, Shares		57
Restricted stock forfeited		(3)
Stock-based compensation expense	4,087		4,087
Net earnings (loss)	4,920				4,920
Unrealized gain (loss) on derivative instruments, net of tax	2,279			2,279
Foreign currency adjustment	(7,311)			(7,311)
Dividends ($0.40 in March 31, 2014, $0.50 in March 31, 2015 and $0.38 in March 31, 2016 per share)	(6,500)				(6,500)
Balances at Mar. 31, 2015	180,372	$ 130	1,940	(7,142)	185,444
Balances, shares at Mar. 31, 2015		12,949
Exercise of stock options	$ 582		582
Exercise of stock options, Shares	37,442	38
Tax benefits from stock options exercised	$ (221)		(221)
Repurchase of common stock	(136)		(136)
Repurchase of common stock, Shares		(5)
Restricted stock awards and units	(292)		(292)
Restricted stock awards and units, Shares		58
Restricted stock forfeited		(2)
Stock-based compensation expense	4,232		4,232
Net earnings (loss)	(9,187)				(9,187)
Unrealized gain (loss) on derivative instruments, net of tax	(4,429)			(4,429)
Foreign currency adjustment	1,387			1,387
Dividends ($0.40 in March 31, 2014, $0.50 in March 31, 2015 and $0.38 in March 31, 2016 per share)	(4,917)				(4,917)
Balances at Mar. 31, 2016	$ 167,391	$ 130	$ 6,105	$ (10,184)	$ 171,340
Balances, shares at Mar. 31, 2016		13,038

XML

Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Dividends per share	$ 0.38	$ 0.50	$ 0.40
Retained Earnings
Dividends per share	$ 0.38	$ 0.50	$ 0.40

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Cash flows from operating activities
Net earnings (loss)	$ (9,187)	$ 4,920	$ 39,404
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization	19,767	15,509	14,189
Loss on the disposal of assets		51	3
Deferred income taxes	1,613	1,489	6,076
Stock-based compensation expense	4,294	4,087	2,584
Proceeds from new market tax credit, net of deferred costs	4,403
Changes in operating assets and liabilities
Trading securities	1,009	58,999	17,232
Accounts receivable	(10,221)	14,813	(10,949)
Inventories	13,320	(14,024)	(42,159)
Accounts payable	872	(21,617)	26,768
Accrued expenses	(3,385)	(188)	(1,264)
Income taxes	(6,694)	(3,494)	(6,931)
Prepaid expenses and other	3,332	(844)	(774)
Net cash provided by operating activities	19,123	59,701	44,179
Cash flows from investing activities:
Purchases of property and equipment	(37,964)	(22,187)	(24,377)
Acquisition of business		(8,428)
Other	(2)	(9)	36
Net cash used in investing activities	(37,966)	(30,624)	(24,341)
Cash flows from financing activities:
Proceeds from long-term borrowings	293,067	236,760	121,007
Payments on long-term borrowings	(293,067)	(236,760)	(121,007)
Proceeds from issuance of common stock	582	34	185
Payments for income taxes on net-settled option exercises	(292)	(1,897)	(7,652)
Tax benefit from stock option exercises	65	758	7,499
Dividends paid	(4,917)	(6,500)	(5,317)
Repurchase of common stock	(136)	(1,042)	(28,190)
Net cash used in financing activities	(4,698)	(8,647)	(33,475)
Effect of exchange rate changes on cash and cash equivalents	1,018	(2,701)	595
Net increase (decrease) in cash and cash equivalents	(22,523)	17,729	(13,042)
Cash and cash equivalents at beginning of year	40,253	22,524	35,566
Cash and cash equivalents at end of year	17,730	40,253	22,524
Supplemental disclosure of cash payments for:
Income taxes	168	3,271	13,892
Interest	$ 848	$ 353	$ 122

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

12 Months Ended

Mar. 31, 2016

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Unless the context otherwise requires, the use of the terms “Arctic Cat,” “we,” “our,” or “us” in these Notes to Consolidated Financial Statements refers to Arctic Cat Inc. and, as applicable, its consolidated subsidiaries.

Description of Business

Arctic Cat designs, engineers, manufactures and markets snowmobiles, all-terrain vehicles (ATVs), recreational off-highway vehicles (“side-by-sides” or “ROVs”) and related parts, garments and accessories (PG&A) under the Arctic Cat^® and MotorFist^® brand names. We market our products through a network of independent dealers located throughout the United States, Canada, and Europe and through distributors in Europe, the Middle East, Asia and other international markets.

Our business is organized into three operating segments based on our product lines: (1) snowmobile; (2) ATV/ROV and (3) PG&A. We aggregate the snowmobile and ATV/ROV segments into one operating segment, as the segments have similar economic characteristics. Accordingly, we have two reportable segments: (1) snowmobiles and ATV/ROV and (2) PG&A. See Note 11, Segment Reporting, for additional detail on our segments.

Basis of Presentation

The consolidated financial statements include the accounts of Arctic Cat Inc. and its consolidated subsidiaries. We also consolidate, regardless of our ownership percentage, variable interest entity’s (“VIE’s”) for which we are deemed to have a controlling financial interest. All intercompany accounts and transactions are eliminated upon consolidation.

When we obtain an economic interest in an entity, we evaluate the entity to determine if the entity is a VIE, and if we are deemed to be a primary beneficiary. As a part of our evaluation, we are required to qualitatively assess if we are the primary beneficiary of the VIE based on whether we hold the power to direct those matters that most significantly impacted the activities of the VIE and the obligation to absorb losses or the right to receive the benefits of the VIE that could potentially be significant. Refer to Note 12, New Market Tax Credit Transaction, for a description of the VIE included in our consolidated financial statements.

In preparing the accompanying consolidated financial statements, we evaluated the period from April 1, 2016, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. No such events were identified for this period.

Use of Estimates

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, related revenues and expenses and disclosure about contingent assets and liabilities at the date of the financial statements. We base our estimates on historical experience and on other various assumptions believed to be reasonable under the circumstances. We believe that such estimates are established using consistent, reasonable and appropriate methods. Accordingly, actual results could differ from the estimates used by management.

Reclassifications

Certain prior period Consolidated Balance Sheet and Notes to Consolidated Financial Statement amounts have been reclassified to conform to the fiscal 2016 financial statement presentation. The reclassifications had no effect on previously reported operating results.

Cash and Cash Equivalents

We consider highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. At times, certain bank deposits may be in excess of federally insured limits. As of March 31, 2016 and 2015, Arctic Cat had approximately $7.2 and $19.2 million, respectively, of cash located in foreign banks primarily in Europe and Canada.

Accounts Receivable and Allowance for Uncollectible Accounts

Our accounts receivable balance consists of amounts due from our dealers and finance companies. We extend credit to our dealers based on an evaluation of the dealers’ financial condition. Our collection exposure relating to accounts receivable amounts due from dealer floorplan finance institutions is limited due to the financial strength of the finance institutions and provisions of our existing agreements. Accounts receivable is presented net of an allowance for estimated uncollectible amounts due from our dealers. We estimate uncollectible amounts considering numerous factors, mainly the length of time the receivables are past due, the historical collection experience and existing economic conditions. Our allowance for uncollectible accounts was $1.8 and $1.9 million at March 31, 2016 and 2015, respectively. Account balances are charged off against the allowance when all collection efforts have been exhausted. Amounts which are considered to be uncollectible are written off and recoveries of amounts previously written off are credited to the allowance upon recovery. Accounts receivable amounts written off have been within management’s expectations.

The activity in the allowance for uncollectible accounts for accounts receivable is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,897		$	1,988
Provisions charged to expense		40			287
Deductions for amounts written-off		(143	)		(378	)
Balance at end of period	$	1,794		$	1,897

Inventories

Inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out method. Manufacturing costs include materials, labor, freight-in, and manufacturing overhead. Unallocated overhead and abnormal costs are expensed as incurred. Market represents the estimated selling price in the ordinary course of business less cost to sell and considers general market and economic conditions, reviews of current profitability of products, product warranty costs and the effect of current and expected incentive offers as of the balance sheet date. We establish a reserve for excess, slow-moving, and obsolete inventory that is equal to the difference between the cost and estimated net realizable value for that inventory. These reserves are based on a review and comparison of current inventory levels to planned production, as well as planned and historical sales of the inventory. Additionally, due to significant movements of partially-manufactured components and parts between manufacturing plants, we do not internally measure, nor do our accounting systems provide, a meaningful segregation between raw materials and work-in-process.

Inventories consist of the following at March 31 ($ in thousands):

	2016		2015
Raw materials and sub-assemblies	$	35,770	$	41,045
Finished goods		64,127		77,763
Parts, garments and accessories		40,110		33,635
	$	140,007	$	152,443

Losses resulting from the application of lower of cost or market accounting were not material for the years ended March 31, 2016, 2015 and 2014, respectively.

Derivative Instruments and Hedging Activities

We enter into forward exchange contracts to protect against exposure to currency fluctuations on transactions denominated in foreign currencies, namely the Canadian dollar and Japanese yen. The contracts are designated as, and meet the criteria for, cash flow hedges. We do not enter into forward contracts for the purpose of trading or speculative purposes. Derivatives are recognized on the Consolidated Balance Sheets at fair value, and the effective portion of the change in the fair value of the derivative is recorded in accumulated other comprehensive income (loss), net of tax, and subsequently reclassified into operating expense upon completing transfers of Canadian dollar or Japanese yen funds when the hedged item affects earnings.

Fair Value Measurements

We record certain assets and liabilities at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. A fair value hierarchy has been established, which requires classification based on observable and unobservable inputs when measuring fair value. Refer to Note 2, Fair Value Measurements, for additional information.

Property and Equipment, Net

Property and equipment is stated at cost. Major improvements that extend the useful life or add functionality are capitalized and repairs and maintenance cost that are considered not to extend the useful life of the property and equipment are expensed as incurred. Depreciation is provided in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives, using the straight-line method for all property, equipment and tooling. Tooling is depreciated over the life of the product, generally 3-5 years. Estimated service lives range from 15-39 years for buildings and improvements and 5-15 years for machinery and equipment. Accelerated and straight-line methods are used for income tax reporting. Upon disposal of property and equipment, the cost and accumulated depreciation are removed from the Consolidated Balance Sheets and the resulting gain or loss is reflected in earnings.

Impairment of Long-Lived Assets

Long-lived assets include property and equipment and definite-life intangible assets. We evaluate the carrying value of long-lived assets for impairment when events or changes in business circumstances indicate that the carrying amount of an asset, or asset group, may not be fully recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the assets, the carrying value is reduced to the estimated fair value as measured by quoted market prices or other valuation techniques (e.g., discounted cash flow analysis) and an accompanying impairment loss is recognized within earnings. Fair value is primarily determined using discounted cash flow analyses; however, other methods may be used to determine the fair value, including third party valuations when necessary. We recognized no impairment of long-lived assets in fiscal years 2016, 2015 and 2014.

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in a business combination. We test goodwill for impairment annually or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount.

Our impairment testing for goodwill is performed separately from our impairment testing of indefinite-lived intangible assets, but the income approach is utilized for both in determining fair value. We test goodwill and indefinite-lived intangible assets for impairment at the reporting unit level and individual indefinite-lived intangible asset level, respectively. Under the income approach, we calculate the fair value of our four reporting units and indefinite-lived intangible assets using the present value of future cash flows. Individual indefinite-lived intangible assets are tested by comparing the book values of each asset to the estimated fair value. Our estimate of fair value for indefinite-lived intangible assets uses projected revenues from our forecasting process, assumed royalty rates, and a discount rate. Assumptions in our impairment evaluations, such as forecasted growth rates and cost of capital, are consistent with internal projections and operating plans. Materially different assumptions regarding future performance of our businesses or a different weighted-average cost of capital could result in impairment losses or additional amortization expense.

We perform a two-step quantitative test for goodwill impairment. First, we compare the carrying value of a reporting unit, including goodwill, to its fair value. The fair value of each reporting unit is estimated using a discounted cash flow model. Where available, and as appropriate, comparable market multiples and our company’s market capitalization are also utilized to corroborate the results of the discounted cash flow models. If the first step indicates the carrying value exceeds the fair value of the reporting unit, then a second step must be completed in order to determine the amount of goodwill impairment that should be recorded. In the second step, the implied fair value of the reporting unit’s goodwill is determined by allocating the reporting unit’s fair value to all of its assets and liabilities other than goodwill. The implied fair value of the goodwill that results from the application of this second step is then compared to the carrying amount of the goodwill and an impairment charge is recorded for the difference.

Identifiable intangible assets are amortized over their useful lives on a straight-line basis, unless the useful life is determined to be indefinite. The useful life of an identifiable definite-lived intangible asset is based on an analysis of several factors, including contractual, regulatory or legal obligations, demand, competition, and industry trends. Refer to Note 4, Goodwill and Intangible Assets, for additional information.

Product Warranties

We generally provide a limited warranty on snowmobiles for 12 months from the date of consumer registration and for six months from the date of consumer registration on ATVs and ROVs. We may provide longer warranties in certain geographical markets as determined by local regulations and market conditions, as well as related to certain promotional programs. We provide for estimated warranty costs at the time of sale based on historical rates and trends. Subsequent adjustments are made to the warranty reserve as actual claims become known or the amounts are determinable, including costs associated with safety recalls, which may occur after the standard warranty period.

The following represents changes in our accrued warranty liability for the fiscal years 2016, 2015 and 2014 ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	23,062		$	19,357		$	18,709
Warranty provision		13,864			21,499			16,770
Warranty claim payments		(12,117	)		(17,794	)		(16,122	)
Balance at end of period	$	24,809		$	23,062		$	19,357

Insurance

We are self-insured for certain losses relating to employee medical, workers’ compensation, and certain product liability claims. Specific stop loss coverages are provided for catastrophic claims in order to mitigate our exposure. Under these plans, liabilities are recognized for claims incurred, including those incurred but not reported. Losses and claims are charged to operations when it is probable a loss has been incurred and the amount can be reasonably estimated.

Revenue Recognition

We recognize revenue and provide for estimated marketing and sales incentive costs when persuasive evidence of an arrangement exists; delivery has occurred and ownership has transferred to the customer; the price to the customer is fixed or determinable; and collectability is reasonably assured. These criteria are generally met when title passes at the time product is shipped to dealers in accordance with shipping terms, which are primarily freight-on-board shipping point. Most sales are made to dealers financing their purchases under flooring arrangements with financial institutions.

At the time of revenue recognition, shipping and handling costs are recorded as a component of costs of goods sold and shipping charges to the dealers are recorded as revenue. Return allowances for parts, garments and accessories are recorded as a reduction of revenue when the revenue is recognized based on our return allowance program and historical experience.

Sales tax collected from customers is remitted to the appropriate taxing jurisdictions and is excluded from sales revenue as we consider ourselves a pass-through conduit for collecting and remitting sales taxes.

Marketing and Sales Incentive Costs

We provide for various marketing and sales incentive costs that are offered to our dealers and consumers at the later of when the revenue is recognized or when the marketing and sales incentive program is approved and communicated for products previously shipped. Examples of these costs, which are recognized as a reduction of revenue when the products are sold, include dealer and consumer rebates, dealer floorplan financing assistance and other incentive and promotional programs. Sales incentives that involve a free product or service delivered to the consumer, such as extended warranties, are recorded as a component of cost of goods sold.

We estimate the costs of these various marketing and sales incentive programs based on expected usage considering current program parameters, historical experience, dealer inventory levels, the terms of arrangements with dealers and expectations for changes in relevant trends in the future. Actual results may differ from these estimates if market conditions dictate the need to enhance or reduce sales promotion and incentive programs or if the current market trends vary from historical trends. To the extent current experience differs with previous estimates, the accrued liability for marketing and sales incentives is adjusted accordingly. Historically, marketing and sales incentive accruals have been within our expectations and differences have not been material.

Dealer Holdback

We provide for a dealer holdback program on product sales to our dealer network. The dealer holdback represents a portion of the invoiced sales price that is held by us and is expected to be subsequently returned to the dealer or distributor as a sales incentive upon the ultimate retail sale of the product to the end customer. Holdback amounts reduce the definitive net price of the products purchased by the dealers or distributors and ultimately reduce the amount of sales we recognize at the time of shipment. At the time product revenue is recognized, the portion of the invoiced sales price estimated as the holdback is accrued for as dealer holdback liability within accounts payable on our balance sheet. If the products subject to the holdback program are sold within the program’s term, we refund the holdback to the dealer. Any remaining holdback balances at the expiration of the program’s term are refunded to the dealer or distributor. Our dealer holdback program liability, included within accounts payable, was $17.2 million and $19.8 million as of March 31, 2016 and 2015, respectively.

Research and Development

Research and development costs and are expensed as incurred. Research and development expense was $27.2 million, $24.3 million and $24.0 million during fiscal 2016, 2015 and 2014, respectively.

Advertising

We expense advertising costs as incurred, except for cooperative advertising obligations arising related to the sale of our products to our dealers. The estimated cost of cooperative advertising, which the dealer is required to support, is recorded as marketing expense at the time the product is sold. Cooperative advertising was $3.0 million, $3.6 million and $3.4 million in fiscal 2016, 2015 and 2014, respectively. Total advertising expense, including cooperative advertising, was $19.5 million, $18.6 million and $17.6 million in fiscal 2016, 2015 and 2014, respectively.

Stock-Based Compensation

Our stock-based compensation awards are generally granted to executive officers, other employees, and non-employee members of the Board of Directors of Arctic Cat (the “Board”), and may include performance share awards that are contingent upon the achievement of performance goals of Arctic Cat. Compensation expense equal to the grant date fair value is recognized for these awards on a straight-line basis over the vesting period and is recorded within general and administrative expense. Refer to Note 7, Shareholders’ Equity, for additional information regarding our stock-based compensation plans.

Foreign Currency

Our activities with Canadian dealers are denominated in Canadian dollars and our activities with European on-road ATV/ROV dealers and distributors are denominated in the Euro. In addition, we have certain supply contracts that are denominated in Japanese yen. Assets and liabilities denominated in foreign currency are translated using the exchange rates in effect at the balance sheet date. Revenues and expenses are translated at the weighted-average foreign exchange rates in effect for the period. Translation gains and losses relating to the Canadian dollar and Japanese yen are reflected in the results of operations and Euro currency are reflected as a component of other comprehensive income.

Income Taxes

Deferred income tax assets and liabilities are recognized for the expected future income tax consequences of events attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Under this method, deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years that those temporary differences are expected to be recovered or settled. Judgment is required in assessing the future tax consequences of events that have been recognized in our financial statements or tax returns. Fluctuations in the ultimate outcome of these tax consequences could materially impact our financial position or results of operations. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period in which the enactment takes place. Valuation allowances are provided when, in management’s judgment, it is more likely than not that some portion or all of the benefit of the deferred tax asset will not be recognized.

We recognize the effect of uncertain income tax positions only if the weight of available evidence of those positions indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized upon settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. It is inherently difficult and subjective to estimate such amounts, as we have to determine the probability of various possible outcomes. We reevaluate these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit, voluntary settlements and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. We also record interest and penalties related to unrecognized tax benefits in income tax expense.

Recent Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes and statutory tax withholding requirements and classification within the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2016. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

In February 2016, the FASB issued ASU 2016-02, Lease Accounting, which requires lessees to recognize on the balance sheet certain operating and financing lease liabilities and corresponding right-of-use assets that have lease terms of greater than 12 months. This topic retains the distinction between finance leases and operating leases. The ASU is effective on a modified retrospective approach for annual periods beginning after December 15, 2018, and interim periods therein, with early adoption permitted. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results, noting that we currently expect the majority of our operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon our adoption of ASU 2016-02.

In November 2015, the FASB issued ASU 2015-17, Income Taxes, which provides guidance for the presentation of deferred tax assets and liabilities within the statement of financial position. The ASU requires companies to classify deferred tax assets and liabilities as noncurrent in a classified statement of financial position. The current requirement that deferred tax assets and liabilities of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this ASU. The ASU simplifies the current guidance, which requires entities to separate deferred income tax assets and liabilities into current and noncurrent amounts in a classified statement of financial position. The ASU is effective prospectively or retrospectively for annual periods beginning after December 15, 2016, and interim periods therein, with early adoption permitted. The adoption of the ASU will change the classification of deferred income taxes within our Consolidated Balance Sheets; however, we do not expect the adoption of the ASU to have a material impact on our results of operations or cash flows.

In July 2015, the FASB issued ASU 2015-11, Inventory, which provides guidance for the measurement of inventory. The ASU requires entities to measure most inventory at the lower of cost or net realizable value. The ASU simplifies the current guidance, which requires entities to measure inventory at the lower of cost or market (with market defined as one of three different measures). The ASU is effective prospectively for annual and interim periods beginning after December 15, 2016, and interim periods therein. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which provides guidance for revenue recognition that supersedes existing revenue recognition guidance (but does not apply to nor supersede accounting guidance for lease contracts). The ASU’s core principle is that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In July 2015, the FASB approved a proposal to defer the effective date of the ASU by one year to reporting periods beginning after December 15, 2018. The ASU should be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

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FAIR VALUE MEASUREMENTS

12 Months Ended

Mar. 31, 2016

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

2. FAIR VALUE MEASUREMENTS

We record certain assets and liabilities at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. A fair value hierarchy has been established, which requires classification based on observable and unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value:

Level 1—Quoted prices in active markets for identical assets or liabilities.

Level 2—Observable inputs other than Level 1 prices such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

In determining the fair value of assets and liabilities, we utilize various valuation techniques. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For many financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. In making fair value measurements, observable market data must be used when available. When inputs used to measure fair value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Financial instruments are transferred in and/or out of Level 1, 2 or 3 at the beginning of the accounting period in which there is a change in the valuation inputs.

Recurring Fair Value Measurements

We utilize the income approach to measure the fair value of our foreign currency contracts, which is based on significant other observable inputs. As such, our foreign currency contracts are considered a Level 2 measurement. As of March 31, 2016, our Canadian dollar foreign currency contracts fair value represented a foreign exchange asset of $0.1 million and a foreign exchange liability of $3.9 million. As of March 31, 2015, our Canadian dollar foreign currency contracts fair value represented a foreign exchange asset totaling $3.6 million, and our Japanese yen foreign currency contract fair value was a foreign exchange liability totaling $0.4 million.

Nonrecurring Fair Value Measurements

Our assets and liabilities that are measured at fair value on a nonrecurring basis primarily relate to tangible fixed assets, goodwill and intangible assets, which are generally recorded at fair value as a result of an impairment charge. We did not record any significant charges to assets measured at fair value on a nonrecurring basis during fiscal 2016 and 2015.

Other Fair Value Disclosures

Our financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable and accounts payable and approximate fair value due to their short-term nature.

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

12 Months Ended

Mar. 31, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

3. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We use foreign currency derivative instruments to manage our exposure to currency fluctuations on transactions denominated in foreign currencies – primarily the Canadian dollar and Japanese yen. Our foreign currency management objective is to reduce earnings volatility related to movements in foreign exchange rates and limit the risk of loss in value of certain of our foreign currency-denominated cash flows. We do not enter into forward contracts for trading or speculative purposes. We have no derivatives that have credit risk-related contingent features and we mitigate our risk by engaging with major financial institutions as counterparties.

We record all foreign currency forward contracts at fair value in our Consolidated Balance Sheets. The forward contracts are designated as, and meet the criteria for, cash flow hedges. We evaluate hedge effectiveness prospectively and retrospectively, and we formally document all hedging relationships at inception, as well as the risk management objectives for undertaking the hedge transaction. Our Canadian dollar and Japanese yen forward contracts generally have terms of up to 12 months. Gains and losses on forward contracts are recorded in accumulated other comprehensive income (loss), net of tax, and subsequently reclassified into cost of goods sold or operating expenses during the same period in which the hedged transaction affects the Consolidated Statements of Operations. Gains and losses on the derivative representing hedge ineffectiveness, if any, are recognized in the Consolidated Statements of Operations.

The following table presents the notional amounts and gross carrying values of derivative instruments as of March 31, 2016 and March 31, 2015 ($ in thousands):

	March 31, 2016					March 31, 2015
	Notional Amount (in US Dollars)		Fair Value Asset (Liability), Net (2)			Notional Amount (in US Dollars)		Fair Value Asset (Liability), Net (2)
Canadian Dollar (1)	$	87,875	$	(3,837	)	$	76,328	$	3,628
Japanese Yen (1)		—		—			19,046		(434	)

(1) Assets are included in other current assets and liabilities are included in accrued expenses in the accompanying Consolidated Balance Sheets.

(2) Refer to Note 2, Fair Value Measurements, for additional information on the fair value of our derivative instruments.

The following table presents the effects of derivative instruments on other comprehensive income (OCI) and on our Consolidated Statements of Operations for the years ended March 31, 2016, 2015 and 2014 ($ in thousands):

	March 31, 2016						March 31, 2015
	Pre-Tax Gain (Loss) Recognized in OCI			Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)			Pre-Tax Gain (Loss) Recognized in OCI		Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)
Canadian Dollar (1)	$	(111	)	$	7,354		$	6,047	$	1,996
Japanese Yen (1)		(374	)		(808	)		—		—

(1) Canadian Dollar contracts are included in general and administrative expenses and Japanese Yen contracts are included in cost of goods sold in the accompanying Consolidated Statements of Operations.

The ineffective portion of foreign currency contracts was not material for the years ended March 31, 2016 and 2015.

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GOODWILL AND INTANGIBLE ASSETS

12 Months Ended

Mar. 31, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND INTANGIBLE ASSETS

4. GOODWILL AND INTANGIBLE ASSETS

We do not amortize goodwill or intangible assets with indefinite useful lives, but instead we review these assets for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable through future cash flows. An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount. We conducted our annual assessment for goodwill impairment during the fourth quarter of fiscal 2016 and concluded that goodwill was not impaired.

The changes in the carrying amount of goodwill for the years ended March 31, 2016 and 2015 are as follows ($ in thousands):

	2016		2015
	Gross Carrying Amount		Gross Carrying Amount
Balance as of beginning of year	$	3,342	$	—
Goodwill acquired during the period		—		3,342
Balance as of end of year	$	3,342	$	3,342

The carrying amount of indefinite-lived intangible assets as of March 31, 2016 and 2015 are as follows ($ in thousands):

	2016		2015
	Gross Carrying Amount		Gross Carrying Amount
Indefinite-lived intangible asset balance as of end of year	$	436	$	436

For definite-lived intangible assets, the changes in the net carrying amount for the years ended March 31, 2016 and 2015 are as follows ($ in thousands):

	2016					2015
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount			Accumulated Amortization
Balance as of beginning of year	$	4,312	$	(1,511	)	$	2,058		$	(1,428	)
Intangible assets acquired during the period		—		—			2,255			—
Amortization expense		—		(385	)		—			(83	)
Currency translation effect on foreign balances		3		—			(1	)		—
Balance as of end of year	$	4,315	$	(1,896	)	$	4,312		$	(1,511	)

Definite-lived intangible assets include trademarks/tradenames, dealer network, customer relationships, non-compete agreements and in-process research and development. Amortization expense is expected to be approximately $0.4 million for fiscal 2017, 2018, 2019 and 2020 and approximately $0.3 million for fiscal 2021. The expected amortization expense is an estimate and actual amounts could differ due to additional intangible asset acquisitions, changes in foreign currency rates or impairment of intangible assets.

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FINANCING

12 Months Ended

Mar. 31, 2016

Debt Disclosure [Abstract]

FINANCING

5. FINANCING

We rely on a senior secured revolving credit facility for documentary and stand-by letters of credit, working capital needs and general corporate purposes. On March 10, 2016, we amended our credit facility to extend the maturity date from November 10, 2017 to March 10, 2021 and increase our maximum permissible borrowings from $100.0 million to $130.0 million during May through November and from $50.0 million to $75.0 million during all other months of the fiscal year. The amount of permissible borrowings under the credit facility are dependent upon adequate levels of underlying collateral. Borrowings under the credit facility bear interest at either the base rate plus the applicable margin or the LIBOR rate plus the applicable margin, depending on the type of loan. The applicable margin is calculated based on Arctic Cat’s leverage ratio and amount available for borrowing under the credit facility and ranges from 0.0% to 0.5% for base rate loans and from 1.0% to 1.5% for LIBOR loans. Arctic Cat’s leverage ratio is its ratio of debt to EBITDA, calculated quarterly.

All borrowings are collateralized by substantially all of our assets including all real estate, accounts receivable and inventory. No borrowings from the line of credit were outstanding at March 31, 2016 and 2015. The outstanding letters of credit balances were $3.5 million and $7.9 million at March 31, 2016 and 2015, respectively, and borrowings under the line are subject to certain covenants and restrictions on indebtedness, financial guarantees, business combinations and other related items. We were in compliance with the terms of the credit agreement as of March 31, 2016.

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LEASES

12 Months Ended

Mar. 31, 2016

Leases [Abstract]

LEASES

6. LEASES

We lease buildings and equipment under non-cancelable operating leases. Certain of our lease agreements contain provisions for escalating rent payments over the initial terms of the lease. We account for these leases by recognizing rent expense on a straight-line basis and adjusting the deferred rent expense liability for the difference between the straight-line rent expense and the amount of rent paid. Total rent expense under our lease agreements was $1.4 million, $1.9 million and $1.4 million for fiscal 2016, 2015 and 2014, respectively.

Future minimum lease payments, exclusive of other costs required under non-cancelable operating leases are as follows ($ in thousands):

Fiscal year
2017	$	1,490
2018		1,383
2019		1,248
2020		1,234
2021		1,182
Thereafter		9,042
Total future minimum payments	$	15,579

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SHAREHOLDERS' EQUITY

12 Months Ended

Mar. 31, 2016

Equity [Abstract]

SHAREHOLDERS' EQUITY

7. SHAREHOLDERS’ EQUITY

Stock Compensation Plans

We have outstanding equity awards under a 2013 Omnibus Stock and Incentive Plan (the “2013 Plan”) and a 2007 Omnibus Stock and Incentive Plan (the “2007 Plan,” and along with the 2013 Plan, the “Plans”), previously approved by our shareholders. The Plans provide for incentive and non-qualified stock options, restricted stock and restricted stock unit awards and other incentive awards to be granted to directors, officers, other key employees and consultants. The stock options granted generally vest over a period of one to three years, have an exercise price equal to the fair market value of the stock on the date of grant and expire after a five to ten year life. The stock options are generally subject to accelerated vesting if there is a change in control, as defined in the plans. The restricted stock awards generally vest over a period of two to three years and do not require cash payments from restricted stock award recipients. Stock appreciation rights (“SARs”) generally vest over a period of three years. At March 31, 2016, we had 620,703 shares of common stock available for grant under the plans.

We record stock-based compensation expense related to stock options, restricted stock and restricted stock units over the requisite service period based on the fair value of the awards on the grant date. The fair value of restricted stock awards is based on the closing price of our common shares on the grant date. We record stock-based compensation expense related to cash-settled SARs over the requisite service period based on the fair value of the awards at the end of each reporting period. The fair value of restricted stock awards is based on the closing price of our common shares on the grant date. The fair value of stock option and SARs is estimated on the grant date using the Black-Scholes options pricing model, which includes assumptions regarding the risk-free interest rate, dividend yield, life of the award and the volatility of our common shares.

For the fiscal years ended March 31, 2016, 2015 and 2014, we recorded stock-based compensation expense for stock options, restricted stock and SAR awards of $4.3 million, $4.1 million and $2.6 million, respectively, which have been included in general and administrative expenses. At March 31, 2016, we had $9.3 million of unrecognized compensation costs related to non-vested stock options, restricted stock and SARs awards that are expected to be recognized over a weighted average period of approximately two years.

Stock Options

The following tables summarize the stock option transactions under the Plans during fiscal 2016:

	Number of Shares Under Option			Weighted Average Exercise Price
Outstanding at March 31, 2015		604,218		$	29.39
Granted		121,819			29.57
Cancelled		(10,356	)		36.39
Expired		(30	)		13.59
Exercised		(37,442	)		15.52
Outstanding at March 31, 2016		678,209		$	30.08
Options exercisable at March 31, 2016		262,734		$	17.83
Options expected to vest at March 31, 2016		266,806		$	20.30

Stock options outstanding had an aggregate intrinsic value of $0.5 million, $5.3 million and $10.9 million and a weighted-average contractual life of 7.48 years, 8.03 years and 5.09 years at March 31, 2016, 2015 and 2014, respectively. Exercisable stock options had an aggregate intrinsic value of $0.4 million at March 31, 2016 and a weighted-average contractual life of 6.32 years. The aggregate intrinsic value is based on the difference between the exercise price and our March 31, 2016 common share market value for in-the-money options.

The following tables summarize information concerning currently outstanding and exercisable stock options at March 31, 2016:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$6.26 - 9.57		3,827		3.34 years	$	6.28		3,827	$	6.28
10.79 - 16.45		145,762		5.09 years		13.97		132,180		13.71
17.78 - 27.69		63,051		7.40 years		21.29		48,029		21.72
28.81 - 43.79		432,035		8.32 years		35.65		160,645		38.21
47.52 - 47.52		33,534		7.63 years		47.52		12,228		47.52
		678,209		7.48 years	$	30.08		356,909	$	26.90

The fair value of each stock option award was estimated on the date of grant using the Black-Scholes options pricing model. The expected term of options granted is the safe harbor period. The volatility is based on historic volatilities from the traded shares of Arctic Cat over the past six years. The risk-free interest rate for periods matching the expected life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Expected dividend is based on the historic dividend of Arctic Cat, as well as our expectation of future dividends as of the grant date of each stock option award. We have analyzed the forfeitures of stock and option grants and have used a 10% forfeiture rate in the expense calculation.

The weighted average fair value of options granted and the assumptions used to estimate the fair value of options for fiscal 2016, 2015 and 2014 are summarized as follows:

	2016			2015			2014
Fair value of options granted	$	13.35		$	15.24		$	16.91
Assumptions:
Dividend yield		1.2	%		1.0	%		1.0	%
Average term		6 years			6 years			5 years
Volatility		51.0	%		49.0	%		49.0	%
Risk-free rate of return		1.7	%		0.8	%		0.8	%

Restricted Stock

The shares of restricted common stock awarded have voting rights and participate equally in all dividends and other distributions duly declared by the Board.

The following tables summarize restricted stock and restricted stock unit award activity under the Plans for fiscal 2016 and 2015:

	2016					2015
Restricted Shares	Shares			Weighted- Average Grant  Date Fair Value		Shares			Weighted- Average Grant  Date Fair Value
Non-vested shares at March 31,		22,500		$	40.12		16,200		$	43.45
Awarded		29,063			18.53		20,200			33.67
Vested		(9,800	)		48.75		(10,900	)		33.81
Forfeited		(1,900	)		24.84		(3,000	)		37.60
Non-vested shares at March 31,		39,863		$	22.98		22,500		$	40.12

	2016					2015
Restricted Stock Units	Shares			Weighted- Average Grant  Date Fair Value		Shares			Weighted- Average Grant  Date Fair Value
Non-vested shares at March 31,		116,439		$	35.67		40,103		$	35.35
Granted		124,558			18.09		135,564			34.81
Vested		(44,722	)		36.15		(57,295	)		33.14
Forfeited		(10,017	)		16.59		(1,933	)		43.81
Non-vested shares at March 31,		186,258		$	24.79		116,439		$	35.67

Cash-Settled Stock Appreciation Rights

In February 2016, we granted 175,000 cash-settled SARs with an exercise price equal to the closing price of Arctic Cat common stock on the date of grant. The cash-settled SARs vest in three equal annual installments beginning on the first anniversary of the grant date and have a five-year term. Upon exercise, the holder is entitled to receive cash proceeds in an amount equal to the difference between (i) the lower of $33.00 and the then-current market value of Arctic Cat common stock and (ii) the fair market value of Arctic Cat common stock on the grant date of February 5, 2016, multiplied by the number of SARs exercised on such date. The cash-settled SARs are included in other liabilities in our Consolidated Balance Sheets and are recorded at fair value at the reporting date.

The following table summarizes the activity during fiscal 2016 for SARs awarded pursuant to the Plans:

	Number of SARs		Weighted Average Exercise Price		Weighted Average Contractual Term
Outstanding at March 31, 2015		—	$	—
Granted		175,000		14.16
Forfeited		—		—
Exercised		—		—
Outstanding at March 31, 2016		175,000	$	14.16		4.9 years
SARs exercisable at March 31, 2016		—	$	—		—
SARs expected to vest at March 31, 2016		144,468	$	14.16		4.9 years

The fair value of the SAR grant was estimated using the Black-Scholes option pricing model and assumptions analogous to our stock option awards, as set forth in the table below:

	2016
Fair value of SARs granted	$	6.40
Assumptions:
Dividend yield		0.0	%
Average term		5 years
Volatility		51.0	%
Risk-free rate of return		1.4	%

Preferred Stock

Our Board is authorized to issue 2,500,000 shares of $1.00 par value preferred stock in one or more series, 450,000 shares of which were designated Series B Junior Participating preferred stock in connection with the previous Shareholder Rights Plan. The Board can determine voting, conversion, dividend and redemption rights and other preferences of each series. No shares have been issued.

Share Repurchase Authorization

On August 7, 2014, the Board authorized the repurchase of an additional $25.0 million in shares of common stock, which supplemented the $1.1 million remaining under the program previously approved in May 2013. We paid $0.1 million, $1.0 million and $28.2 million during fiscal 2016, 2015, and 2014, respectively, to repurchase and cancel 5,162, 27,925 and 633,816 shares of common stock, respectively, pursuant to the Board authorizations. At March 31, 2016, we have remaining authorization to repurchase $25.9 million in shares of common stock.

Net Earnings (Loss) Per Share

Our basic net earnings (loss) per share is computed by dividing net earnings (loss) by the weighted average number of outstanding common shares. Our diluted weighted average shares outstanding include common shares and common share equivalents relating to stock options and restricted stock units, when dilutive. Options to purchase 449,432 and 156,432 shares of common stock with weighted average exercise prices of $35.50 and $44.14 were outstanding during fiscal 2016 and 2015, respectively, but were excluded from the computation of common share equivalents because they were anti-dilutive. No options outstanding were excluded from the computation of common share equivalents during fiscal 2014.

Weighted average shares outstanding consist of the following for the fiscal 2016, 2015 and 2014 (in thousands):

	2016		2015		2014
Weighted average number of common shares outstanding		12,995		12,926		13,275
Dilutive effect of option plan		—		163		323
Common and potential shares outstanding—diluted		12,995		13,089		13,598

Accumulated Other Comprehensive Loss

The components of the changes in accumulated other comprehensive loss during fiscal 2016, 2015 and 2014 were as follows ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	(7,142	)	$	(2,110	)	$	(4,166	)
Unrealized gain (loss) on derivative instruments, net of tax		(4,429	)		2,279			(241	)
Foreign currency translation adjustment		1,387			(7,311	)		2,297
Balance at end of period	$	(10,184	)	$	(7,142	)	$	(2,110	)

The unrealized gains on derivatives instruments in fiscal 2016, 2015 and 2014 were net of tax expense of $2.6 million, $1.3 million and $0.1 million, respectively. There is no tax impact on foreign currency translation adjustments, as the earnings are considered permanently reinvested.

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RETIREMENT SAVINGS PLAN

12 Months Ended

Mar. 31, 2016

Compensation and Retirement Disclosure [Abstract]

RETIREMENT SAVINGS PLAN

8. RETIREMENT SAVINGS PLAN

We sponsor a 401(k) defined contribution plan that covers substantially all full-time employees who are at least 18 years of age and who have completed at least three months of service. Plan participants may make before tax elective contributions up to 50% of their compensation with Arctic Cat matching 50% of the employee contributions, up to a maximum of 5% of the employee’s cash compensation capped at $255,000. Matching contributions of $1.3 million, $1.2 million, and $1.0 million were made in fiscal 2016, 2015 and 2014, respectively. We can elect to make additional contributions at our discretion.

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INCOME TAXES

12 Months Ended

Mar. 31, 2016

Income Tax Disclosure [Abstract]

INCOME TAXES

9. INCOME TAXES

Our income (loss) before income taxes was generated from our United States and foreign operations as follows ($ in thousands):

	For the years ended March 31,
	2016			2015		2014
United States	$	(17,156	)	$	5,532	$	58,655
Foreign		109			678		1,749
Income (loss) before income taxes	$	(17,047	)	$	6,210	$	60,404

Income tax expense (benefit) consists of the following for the fiscal years ended March 31 ($ in thousands):

	2016			2015			2014
Current
Federal	$	(5,935	)	$	2,610		$	13,345
State		(339	)		149			900
Foreign		27			168			436
Deferred		(1,613	)		(1,637	)		6,319
Total income tax expense (benefit)	$	(7,860	)	$	1,290		$	21,000

The following is a reconciliation of the federal statutory income tax rate to the effective tax rate for the fiscal years ended March 31:

	2016			2015			2014
Statutory income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.8			1.9			1.7
Research and other tax credit		5.6			(16.5	)		(1.0	)
Domestic manufacturers deduction		(0.1	)		(0.9	)		(1.4	)
Uncertain tax positions		6.0			(2.3	)		(0.1	)
US subpart F adjustments		0.7			11.1			0.4
Foreign tax rate difference		(1.4	)		(9.1	)		(0.2	)
Stock options		(0.5	)		1.3			(0.1	)
Other		(1.1	)		0.3			0.5
		46.0	%		20.8	%		34.8	%

We utilize the liability method of accounting for income taxes whereby deferred taxes are determined based on the estimated future tax effects of differences between the financial statement and tax bases of assets and liabilities given the provisions of enacted tax laws. The cumulative temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes under the liability method are as follows at March 31 ($ in thousands):

	2016			2015
Current deferred income tax assets
Accrued expenses	$	3,788		$	3,934
Accrued warranty		8,855			8,045
Inventory related items		4,269			4,152
Net operating loss carryforwards		1,628			—
Other		1,560			313
Less: valuation allowance		(351	)		(235	)
Current deferred income tax asset		19,749			16,209
Current deferred income tax liabilities
Prepaid expenses		2,043			1,463
Other		477			1,696
Current deferred income tax liability		2,520			3,159
Net current deferred tax asset	$	17,229		$	13,050
Non-current deferred income tax assets
Compensation payable in common stock	$	1,927		$	1,200
State research and development credits		1,393			1,043
Less: valuation allowance		(1,042	)		(808	)
Non-current deferred income tax asset		2,278			1,435
Non-current deferred income tax liability
Property and equipment		15,471			11,151
Non-current deferred tax liability		15,471			11,151
Net non-current deferred tax liability	$	13,193		$	9,716

Arctic Cat recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the relevant tax authority. We recognize potential interest and penalties related to income tax positions as a component of the provision for income taxes on the consolidated statements of operations.

We had liabilities recorded related to unrecognized tax benefits totaling $1.1 and $2.2 million at March 31, 2016 and 2015, including reserves related to potential interest and penalties of $0.1 and $0.4 million, respectively. The amount of the liability, net of federal benefits for uncertain state tax positions, at March 31, 2016, if recognized, would affect our effective tax rate. Arctic Cat currently anticipates approximately $0.3 million of unrecognized tax benefits will be recognized during the next twelve months. We have state research and development credit carryforwards of $1.4 and $1.0 million offset by valuation allowances as of March 31, 2016 and 2015, respectively, with expiration dates to March 2031. With few exceptions, we are no longer subject to federal, state, or foreign income tax examinations for years prior to March 31, 2012.

A reconciliation of the amount of unrecognized tax benefits excluding interest and penalties is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,828		$	1,707
Increases related to prior year tax positions		50			72
Decreases related to prior year tax positions		(1,033	)		(143	)
Increases related to current year tax positions		200			192
Settlements		—			—
Balance at end of period	$	1,045		$	1,828

Arctic Cat is subject to income taxes in the U.S. federal jurisdiction, and various state jurisdictions, as well as various European jurisdictions. Tax regulations within each jurisdiction are subject to the interpretation of the relevant tax laws and regulations and require significant judgment to apply.

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COMMITMENTS AND CONTINGENCIES

12 Months Ended

Mar. 31, 2016

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

10. COMMITMENTS AND CONTINGENCIES

Product Liability and Litigation

We are subject to product liability and intellectual property legal proceedings and claims, as well as other litigation, arising in the normal course of business. Such matters are generally subject to uncertainties and to outcomes that are not predictable and that may not be known for extended periods of time. Litigation occasionally involves claims for punitive, as well as compensatory, damages arising out of the use of our products. Although we are self-insured to some extent, we maintain insurance against certain product liability losses. We are also typically involved in patent litigation cases in which we are asserting, or defending, against patent infringement claims. To prevent possible future infringement of our patents by competitors, we periodically review competitor’s products. To avoid potential liability with respect to competitors’ patents, we regularly review certain patents issued by the United States Patent and Trademark Office and foreign patent offices. Management believes these activities help minimize our risk of being a defendant in patent infringement litigation. We are currently involved in patent litigation cases, including cases by or against competitors, where we are asserting and defending against claims of patent infringement. Such cases are at varying stages in the litigation process.

We record a reserve in accrued expenses in the Consolidated Balance Sheets based on our estimated range of potential exposures related to claims, including future legal expenditures, settlement and judgments, for which we are aware of, have assessed that a loss is probable and an amount can be reasonably estimated. We utilize historical trends and other analysis to assist in determining the appropriate loss reserve estimate. Should any settlement occur that exceeds our estimate or a new claim arise, we may need to adjust our overall reserve and, depending on the amount, such adjustment could be material. We are not involved in any legal proceedings which we believe will have a materially adverse impact on our business or financial condition, results of operations or cash flows.

Dealer Financing

Finance companies provide our North American dealers with floorplan financing. We have agreements with these finance companies to repurchase certain repossessed products sold to our dealers. At March 31, 2016, we are contingently liable under these agreements for a maximum repurchase amount of approximately $68.5 million. Our financial exposure under these agreements is limited to the difference between the amount paid to the finance companies for repurchases and the amount received upon the resale of the repossessed product. Losses incurred under these agreements during the periods presented have not been material. The financing agreements also have loss sharing provisions should any dealer default, whereby we share certain losses with the finance companies. The maximum liability to us under these provisions is approximately $2.2 million at March 31, 2016.

Purchase Obligations

We enter into non-cancelable purchase commitments with certain of our suppliers for materials and supplies as part of the normal course of business. As of March 31, 2016, our purchase obligation under the non-cancelable purchase commitments was $45.1 million.

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SEGMENT REPORTING

12 Months Ended

Mar. 31, 2016

Segment Reporting [Abstract]

SEGMENT REPORTING

11. SEGMENT REPORTING

The presentation of segment information represents our method of internal reporting for making operating decisions and assessing performance, which generally segregates the operating segments by product line. The internal reporting of these operating segments is based, in part, on the management process utilized by our President and Chief Executive Officer, who is our chief operating decision maker. Based on this management process, we have two operating segments: (1) Snowmobile and ATV/ROV and (2) PG&A, which also represent our two reportable segments.

We aggregate our snowmobile and ATV/ROV operating segments into one operating segment, as the segments have similar economic characteristics. Given the crossover of customers, manufacturing and asset management, we do not maintain separate balance sheets for each segment. Accordingly, the segment information presented below is limited to sales and gross profit data ($ in thousands).

	Years ended March 31,
	2016		2015		2014
Net sales
Snowmobile and ATV/ROV units	$	534,600	$	584,873	$	615,608
PG&A		98,295		113,883		114,883
Total net sales		632,895		698,756		730,491
Cost of goods sold
Snowmobile and ATV/ROV units		476,194		505,383		506,707
PG&A		66,034		73,924		72,705
Total cost of goods sold		542,228		579,307		579,412
Gross profit
Snowmobile and ATV/ROV units		58,406		79,490		108,901
PG&A		32,261		39,959		42,178
Total gross profit	$	90,667	$	119,449	$	151,079

	Years ended March 31,
	2016		2015		2014
Net sales by product line
Snowmobile units	$	258,788	$	300,731	$	282,442
ATV/ROV units		275,812		284,142		333,166
PG&A		98,295		113,883		114,883
Total net sales	$	632,895	$	698,756	$	730,491

	Years ended March 31,
	2016		2015		2014
Net sales by geography, based on location of the customer
United States	$	395,684	$	420,687	$	404,347
Canada		174,658		192,524		215,631
Europe and other		62,553		85,545		110,513
Total net sales	$	632,895	$	698,756	$	730,491

During fiscal 2016, no individual customer accounted for greater than 10% of our net sales. Sales to Yamaha and its subsidiaries in the aggregate accounted for 10.4% of net sales in fiscal year 2015. No sales to an individual customer accounted for more than 10% of fiscal year 2014 net sales.

Property and equipment, net, by geography are presented in the table below ($ in thousands):

	Years ended March 31,
	2016		2015
Long-lived assets by geography
United States	$	88,623	$	69,113
Canada and Europe		223		336
Total long-lived assets	$	88,846	$	69,449

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NEW MARKET TAX CREDIT TRANSACTION

12 Months Ended

Mar. 31, 2016

Text Block [Abstract]

NEW MARKET TAX CREDIT TRANSACTION

12. NEW MARKET TAX CREDIT TRANSACTION

In February 2016, we entered into a transaction with Wells Fargo Community Development Enterprises, Inc. (“Wells Fargo” or “investors”), related to an investment in equipment at our manufacturing facility in Thief River Falls, Minnesota (the “project”). As part of the transaction, Wells Fargo made a contribution to and Arctic Cat Sales Inc. made a loan to, WF Paint & Assembly Investment Fund, LLC (the “Investment Fund”) under the New Market Tax Credit (“NMTC”) program. The NMTC program was provided for in the Community Renewal Tax Relief Act of 2000 (the “Act”) and is intended to induce investment in low-income communities. The Act permits taxpayers, whether companies or individuals, to claim credits against their federal income taxes for up to 39% of qualified investments in the equity of community development entities (“CDEs”). CDEs are privately managed investment institutions that are certified to make qualified low-income community investments.

In connection with the transaction, Arctic Cat Sales Inc. loaned $10.8 million to the Investment Fund at an interest rate of 3.75% per year and with a maturity of June 30, 2032. The Investment Fund then contributed the loan to certain CDEs, which, in turn, loaned the funds to Arctic Cat Production Support LLC, our direct, wholly-owned subsidiary at an interest rate of 3.106%. The proceeds of the loans from the CDEs (including loans representing the capital contribution made by the investors, net of syndication fees) will be used to fund the equipment investments.

In exchange for its $5.3 million contribution to the Investment Fund, Wells Fargo is entitled to substantially all of the tax benefits derived from the NMTC transaction, while we effectively received net proceeds equal to Wells Fargo’s contributions to the Investment Fund less direct and incremental transaction costs. This transaction includes a put/call provision whereby we may be obligated or entitled to repurchase Wells Fargo’s interest in the Investment Fund. We believe that the investor will exercise the put option in February 2023 at the end of the recapture period. If the investor does not exercise the put option, we have a call option to purchase the Investment Fund at fair value. The value attributed to the put/call is de minimis. The NMTC is subject to 100% recapture for a period of seven years as provided in the Internal Revenue Code. We are required to be in compliance with various regulations and contractual provisions that apply to the NMTC arrangement. Non-compliance with applicable requirements could result in projected tax benefits not being realized and, therefore, could require us to indemnify Wells Fargo for any loss or recapture of NMTC’s until such time as our obligation to deliver tax benefits is relieved. We do not anticipate any tax credit recaptures will be required in connection with this arrangement.

We have determined that the Investment Fund is a VIE, of which we are the primary beneficiary and, as such, we have consolidated the Investment Fund. The ongoing activities of the Investment Fund—collecting and remitting interest and fees and NMTC compliance—were all considered in the initial design and are not expected to significantly affect economic performance throughout the life of the Investment Fund. We also considered the contractual arrangements that obligate us to deliver tax benefits and provide various other guarantees to the structure; Wells Fargo’s lack of a material interest in the underlying economics of the project; and the fact that we are obligated to absorb losses of the Investment Fund in determining we are the primary beneficiary.

Based on the contractual arrangements that obligate us to deliver tax benefits to Wells Fargo, we have included Wells Fargo’s contribution within other liabilities in our Consolidated Balance Sheets. The benefit of this net $5.3 million contribution will be recognized as earnings at the end of the seven year recapture period, when our performance obligation is relieved. Direct and incremental costs incurred in structuring the financing arrangement of $0.9 million have been deferred within other assets in the Consolidated Balance Sheets and will be recognized in proportion to the recognition of the related profits. Incremental costs to maintain the structure during the compliance period will be recognized as incurred.

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QUARTERLY FINANCIAL DATA (Unaudited)

12 Months Ended

Mar. 31, 2016

Quarterly Financial Information Disclosure [Abstract]

QUARTERLY FINANCIAL DATA (Unaudited)

13. QUARTERLY FINANCIAL DATA (Unaudited)

($ in thousands, except per share amounts)	Total Year			First Quarter			Second Quarter		Third Quarter			Fourth Quarter
Net Sales
2016	$	632,895		$	134,381		$	211,157	$	166,000		$	121,357
2015		698,756			143,639			262,479		193,735			98,903
2014		730,491			120,768			238,525		225,790			145,408
Gross Profit (Loss)
2016	$	90,667		$	22,562		$	43,918	$	24,250		$	(63	)
2015		119,449			30,801			55,081		34,913			(1,346	)
2014		151,079			29,160			61,674		40,213			20,032
Net Earnings (Loss)
2016	$	(9,187	)	$	(1,056	)	$	11,171	$	(2,397	)	$	(16,905	)
2015		4,920			3,569			15,389		7,487			(21,525	)
2014		39,404			5,468			23,365		12,120			(1,549	)
Net Earnings (Loss) Per Share
2016 Basic	$	(0.71	)	$	(0.08	)	$	0.86	$	(0.18	)	$	(1.30	)
Diluted		(0.71	)		(0.08	)		0.85		(0.18	)		(1.30	)
2015 Basic		0.38			0.28			1.19		0.58			(1.66	)
Diluted		0.38			0.27			1.18		0.57			(1.66	)
2014 Basic		2.97			0.41			1.75		0.90			(0.12	)
Diluted		2.90			0.40			1.70		0.89			(0.12	)

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

12 Months Ended

Mar. 31, 2016

Accounting Policies [Abstract]

Description of Business

Description of Business

Arctic Cat designs, engineers, manufactures and markets snowmobiles, all-terrain vehicles (ATVs), recreational off-highway vehicles (“side-by-sides” or “ROVs”) and related parts, garments and accessories (PG&A) under the Arctic Cat^® and MotorFist^® brand names. We market our products through a network of independent dealers located throughout the United States, Canada, and Europe and through distributors in Europe, the Middle East, Asia and other international markets.

Our business is organized into three operating segments based on our product lines: (1) snowmobile; (2) ATV/ROV and (3) PG&A. We aggregate the snowmobile and ATV/ROV segments into one operating segment, as the segments have similar economic characteristics. Accordingly, we have two reportable segments: (1) snowmobiles and ATV/ROV and (2) PG&A. See Note 11, Segment Reporting, for additional detail on our segments.

Basis of Presentation

Basis of Presentation

The consolidated financial statements include the accounts of Arctic Cat Inc. and its consolidated subsidiaries. We also consolidate, regardless of our ownership percentage, variable interest entity’s (“VIE’s”) for which we are deemed to have a controlling financial interest. All intercompany accounts and transactions are eliminated upon consolidation.

When we obtain an economic interest in an entity, we evaluate the entity to determine if the entity is a VIE, and if we are deemed to be a primary beneficiary. As a part of our evaluation, we are required to qualitatively assess if we are the primary beneficiary of the VIE based on whether we hold the power to direct those matters that most significantly impacted the activities of the VIE and the obligation to absorb losses or the right to receive the benefits of the VIE that could potentially be significant. Refer to Note 12, New Market Tax Credit Transaction, for a description of the VIE included in our consolidated financial statements.

In preparing the accompanying consolidated financial statements, we evaluated the period from April 1, 2016, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. No such events were identified for this period.

Use of Estimates

Use of Estimates

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, related revenues and expenses and disclosure about contingent assets and liabilities at the date of the financial statements. We base our estimates on historical experience and on other various assumptions believed to be reasonable under the circumstances. We believe that such estimates are established using consistent, reasonable and appropriate methods. Accordingly, actual results could differ from the estimates used by management.

Reclassifications

Reclassifications

Certain prior period Consolidated Balance Sheet and Notes to Consolidated Financial Statement amounts have been reclassified to conform to the fiscal 2016 financial statement presentation. The reclassifications had no effect on previously reported operating results.

Cash and Cash Equivalents

Cash and Cash Equivalents

We consider highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. At times, certain bank deposits may be in excess of federally insured limits. As of March 31, 2016 and 2015, Arctic Cat had approximately $7.2 and $19.2 million, respectively, of cash located in foreign banks primarily in Europe and Canada.

Accounts Receivable and Allowance for Uncollectible Accounts

Accounts Receivable and Allowance for Uncollectible Accounts

Our accounts receivable balance consists of amounts due from our dealers and finance companies. We extend credit to our dealers based on an evaluation of the dealers’ financial condition. Our collection exposure relating to accounts receivable amounts due from dealer floorplan finance institutions is limited due to the financial strength of the finance institutions and provisions of our existing agreements. Accounts receivable is presented net of an allowance for estimated uncollectible amounts due from our dealers. We estimate uncollectible amounts considering numerous factors, mainly the length of time the receivables are past due, the historical collection experience and existing economic conditions. Our allowance for uncollectible accounts was $1.8 and $1.9 million at March 31, 2016 and 2015, respectively. Account balances are charged off against the allowance when all collection efforts have been exhausted. Amounts which are considered to be uncollectible are written off and recoveries of amounts previously written off are credited to the allowance upon recovery. Accounts receivable amounts written off have been within management’s expectations.

The activity in the allowance for uncollectible accounts for accounts receivable is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,897		$	1,988
Provisions charged to expense		40			287
Deductions for amounts written-off		(143	)		(378	)
Balance at end of period	$	1,794		$	1,897

Inventories

Inventories

Inventories are valued at the lower of cost or market, with cost determined using the first-in, first-out method. Manufacturing costs include materials, labor, freight-in, and manufacturing overhead. Unallocated overhead and abnormal costs are expensed as incurred. Market represents the estimated selling price in the ordinary course of business less cost to sell and considers general market and economic conditions, reviews of current profitability of products, product warranty costs and the effect of current and expected incentive offers as of the balance sheet date. We establish a reserve for excess, slow-moving, and obsolete inventory that is equal to the difference between the cost and estimated net realizable value for that inventory. These reserves are based on a review and comparison of current inventory levels to planned production, as well as planned and historical sales of the inventory. Additionally, due to significant movements of partially-manufactured components and parts between manufacturing plants, we do not internally measure, nor do our accounting systems provide, a meaningful segregation between raw materials and work-in-process.

Inventories consist of the following at March 31 ($ in thousands):

	2016		2015
Raw materials and sub-assemblies	$	35,770	$	41,045
Finished goods		64,127		77,763
Parts, garments and accessories		40,110		33,635
	$	140,007	$	152,443

Losses resulting from the application of lower of cost or market accounting were not material for the years ended March 31, 2016, 2015 and 2014, respectively.

Derivative Instruments and Hedging Activities

Derivative Instruments and Hedging Activities

We enter into forward exchange contracts to protect against exposure to currency fluctuations on transactions denominated in foreign currencies, namely the Canadian dollar and Japanese yen. The contracts are designated as, and meet the criteria for, cash flow hedges. We do not enter into forward contracts for the purpose of trading or speculative purposes. Derivatives are recognized on the Consolidated Balance Sheets at fair value, and the effective portion of the change in the fair value of the derivative is recorded in accumulated other comprehensive income (loss), net of tax, and subsequently reclassified into operating expense upon completing transfers of Canadian dollar or Japanese yen funds when the hedged item affects earnings.

Fair Value Measurements

Fair Value Measurements

We record certain assets and liabilities at fair value in the financial statements; some of these are measured on a recurring basis while others are measured on a non-recurring basis. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Assets and liabilities measured on a recurring basis are those that are adjusted to fair value each time a financial statement is prepared. Assets and liabilities measured on a non-recurring basis are those that are adjusted to fair value when required by particular events or circumstances. A fair value hierarchy has been established, which requires classification based on observable and unobservable inputs when measuring fair value. Refer to Note 2, Fair Value Measurements, for additional information.

Property and Equipment, Net

Property and Equipment, Net

Property and equipment is stated at cost. Major improvements that extend the useful life or add functionality are capitalized and repairs and maintenance cost that are considered not to extend the useful life of the property and equipment are expensed as incurred. Depreciation is provided in amounts sufficient to relate the cost of depreciable assets to operations over their estimated service lives, using the straight-line method for all property, equipment and tooling. Tooling is depreciated over the life of the product, generally 3-5 years. Estimated service lives range from 15-39 years for buildings and improvements and 5-15 years for machinery and equipment. Accelerated and straight-line methods are used for income tax reporting. Upon disposal of property and equipment, the cost and accumulated depreciation are removed from the Consolidated Balance Sheets and the resulting gain or loss is reflected in earnings.

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

Long-lived assets include property and equipment and definite-life intangible assets. We evaluate the carrying value of long-lived assets for impairment when events or changes in business circumstances indicate that the carrying amount of an asset, or asset group, may not be fully recoverable. If impairment indicators are present and the estimated future undiscounted cash flows are less than the carrying value of the assets, the carrying value is reduced to the estimated fair value as measured by quoted market prices or other valuation techniques (e.g., discounted cash flow analysis) and an accompanying impairment loss is recognized within earnings. Fair value is primarily determined using discounted cash flow analyses; however, other methods may be used to determine the fair value, including third party valuations when necessary. We recognized no impairment of long-lived assets in fiscal years 2016, 2015 and 2014.

Goodwill and Indefinite-Lived Intangible Assets

Goodwill and Indefinite-Lived Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in a business combination. We test goodwill for impairment annually or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. An impairment charge for goodwill is recognized only when the estimated fair value of a reporting unit, including goodwill, is less than its carrying amount.

Our impairment testing for goodwill is performed separately from our impairment testing of indefinite-lived intangible assets, but the income approach is utilized for both in determining fair value. We test goodwill and indefinite-lived intangible assets for impairment at the reporting unit level and individual indefinite-lived intangible asset level, respectively. Under the income approach, we calculate the fair value of our four reporting units and indefinite-lived intangible assets using the present value of future cash flows. Individual indefinite-lived intangible assets are tested by comparing the book values of each asset to the estimated fair value. Our estimate of fair value for indefinite-lived intangible assets uses projected revenues from our forecasting process, assumed royalty rates, and a discount rate. Assumptions in our impairment evaluations, such as forecasted growth rates and cost of capital, are consistent with internal projections and operating plans. Materially different assumptions regarding future performance of our businesses or a different weighted-average cost of capital could result in impairment losses or additional amortization expense.

We perform a two-step quantitative test for goodwill impairment. First, we compare the carrying value of a reporting unit, including goodwill, to its fair value. The fair value of each reporting unit is estimated using a discounted cash flow model. Where available, and as appropriate, comparable market multiples and our company’s market capitalization are also utilized to corroborate the results of the discounted cash flow models. If the first step indicates the carrying value exceeds the fair value of the reporting unit, then a second step must be completed in order to determine the amount of goodwill impairment that should be recorded. In the second step, the implied fair value of the reporting unit’s goodwill is determined by allocating the reporting unit’s fair value to all of its assets and liabilities other than goodwill. The implied fair value of the goodwill that results from the application of this second step is then compared to the carrying amount of the goodwill and an impairment charge is recorded for the difference.

Identifiable intangible assets are amortized over their useful lives on a straight-line basis, unless the useful life is determined to be indefinite. The useful life of an identifiable definite-lived intangible asset is based on an analysis of several factors, including contractual, regulatory or legal obligations, demand, competition, and industry trends. Refer to Note 4, Goodwill and Intangible Assets, for additional information.

Product Warranties

Product Warranties

We generally provide a limited warranty on snowmobiles for 12 months from the date of consumer registration and for six months from the date of consumer registration on ATVs and ROVs. We may provide longer warranties in certain geographical markets as determined by local regulations and market conditions, as well as related to certain promotional programs. We provide for estimated warranty costs at the time of sale based on historical rates and trends. Subsequent adjustments are made to the warranty reserve as actual claims become known or the amounts are determinable, including costs associated with safety recalls, which may occur after the standard warranty period.

The following represents changes in our accrued warranty liability for the fiscal years 2016, 2015 and 2014 ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	23,062		$	19,357		$	18,709
Warranty provision		13,864			21,499			16,770
Warranty claim payments		(12,117	)		(17,794	)		(16,122	)
Balance at end of period	$	24,809		$	23,062		$	19,357

Insurance

Insurance

We are self-insured for certain losses relating to employee medical, workers’ compensation, and certain product liability claims. Specific stop loss coverages are provided for catastrophic claims in order to mitigate our exposure. Under these plans, liabilities are recognized for claims incurred, including those incurred but not reported. Losses and claims are charged to operations when it is probable a loss has been incurred and the amount can be reasonably estimated.

Revenue Recognition

Revenue Recognition

We recognize revenue and provide for estimated marketing and sales incentive costs when persuasive evidence of an arrangement exists; delivery has occurred and ownership has transferred to the customer; the price to the customer is fixed or determinable; and collectability is reasonably assured. These criteria are generally met when title passes at the time product is shipped to dealers in accordance with shipping terms, which are primarily freight-on-board shipping point. Most sales are made to dealers financing their purchases under flooring arrangements with financial institutions.

At the time of revenue recognition, shipping and handling costs are recorded as a component of costs of goods sold and shipping charges to the dealers are recorded as revenue. Return allowances for parts, garments and accessories are recorded as a reduction of revenue when the revenue is recognized based on our return allowance program and historical experience.

Sales tax collected from customers is remitted to the appropriate taxing jurisdictions and is excluded from sales revenue as we consider ourselves a pass-through conduit for collecting and remitting sales taxes.

Marketing and Sales Incentive Costs

Marketing and Sales Incentive Costs

We provide for various marketing and sales incentive costs that are offered to our dealers and consumers at the later of when the revenue is recognized or when the marketing and sales incentive program is approved and communicated for products previously shipped. Examples of these costs, which are recognized as a reduction of revenue when the products are sold, include dealer and consumer rebates, dealer floorplan financing assistance and other incentive and promotional programs. Sales incentives that involve a free product or service delivered to the consumer, such as extended warranties, are recorded as a component of cost of goods sold.

We estimate the costs of these various marketing and sales incentive programs based on expected usage considering current program parameters, historical experience, dealer inventory levels, the terms of arrangements with dealers and expectations for changes in relevant trends in the future. Actual results may differ from these estimates if market conditions dictate the need to enhance or reduce sales promotion and incentive programs or if the current market trends vary from historical trends. To the extent current experience differs with previous estimates, the accrued liability for marketing and sales incentives is adjusted accordingly. Historically, marketing and sales incentive accruals have been within our expectations and differences have not been material.

Dealer Holdback

Dealer Holdback

We provide for a dealer holdback program on product sales to our dealer network. The dealer holdback represents a portion of the invoiced sales price that is held by us and is expected to be subsequently returned to the dealer or distributor as a sales incentive upon the ultimate retail sale of the product to the end customer. Holdback amounts reduce the definitive net price of the products purchased by the dealers or distributors and ultimately reduce the amount of sales we recognize at the time of shipment. At the time product revenue is recognized, the portion of the invoiced sales price estimated as the holdback is accrued for as dealer holdback liability within accounts payable on our balance sheet. If the products subject to the holdback program are sold within the program’s term, we refund the holdback to the dealer. Any remaining holdback balances at the expiration of the program’s term are refunded to the dealer or distributor. Our dealer holdback program liability, included within accounts payable, was $17.2 million and $19.8 million as of March 31, 2016 and 2015, respectively.

Research and Development

Research and Development

Research and development costs and are expensed as incurred. Research and development expense was $27.2 million, $24.3 million and $24.0 million during fiscal 2016, 2015 and 2014, respectively.

Advertising

Advertising

We expense advertising costs as incurred, except for cooperative advertising obligations arising related to the sale of our products to our dealers. The estimated cost of cooperative advertising, which the dealer is required to support, is recorded as marketing expense at the time the product is sold. Cooperative advertising was $3.0 million, $3.6 million and $3.4 million in fiscal 2016, 2015 and 2014, respectively. Total advertising expense, including cooperative advertising, was $19.5 million, $18.6 million and $17.6 million in fiscal 2016, 2015 and 2014, respectively.

Stock-Based Compensation

Stock-Based Compensation

Our stock-based compensation awards are generally granted to executive officers, other employees, and non-employee members of the Board of Directors of Arctic Cat (the “Board”), and may include performance share awards that are contingent upon the achievement of performance goals of Arctic Cat. Compensation expense equal to the grant date fair value is recognized for these awards on a straight-line basis over the vesting period and is recorded within general and administrative expense. Refer to Note 7, Shareholders’ Equity, for additional information regarding our stock-based compensation plans.

Foreign Currency

Foreign Currency

Our activities with Canadian dealers are denominated in Canadian dollars and our activities with European on-road ATV/ROV dealers and distributors are denominated in the Euro. In addition, we have certain supply contracts that are denominated in Japanese yen. Assets and liabilities denominated in foreign currency are translated using the exchange rates in effect at the balance sheet date. Revenues and expenses are translated at the weighted-average foreign exchange rates in effect for the period. Translation gains and losses relating to the Canadian dollar and Japanese yen are reflected in the results of operations and Euro currency are reflected as a component of other comprehensive income.

Income Taxes

Income Taxes

Deferred income tax assets and liabilities are recognized for the expected future income tax consequences of events attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Under this method, deferred tax assets and liabilities are measured using the enacted tax rates expected to apply to taxable income in the years that those temporary differences are expected to be recovered or settled. Judgment is required in assessing the future tax consequences of events that have been recognized in our financial statements or tax returns. Fluctuations in the ultimate outcome of these tax consequences could materially impact our financial position or results of operations. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income tax expense in the period in which the enactment takes place. Valuation allowances are provided when, in management’s judgment, it is more likely than not that some portion or all of the benefit of the deferred tax asset will not be recognized.

We recognize the effect of uncertain income tax positions only if the weight of available evidence of those positions indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized upon settlement. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. It is inherently difficult and subjective to estimate such amounts, as we have to determine the probability of various possible outcomes. We reevaluate these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit, voluntary settlements and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision. We also record interest and penalties related to unrecognized tax benefits in income tax expense.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In March 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-09, Improvements to Employee Share-Based Payment Accounting, which simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes and statutory tax withholding requirements and classification within the statement of cash flows. The ASU is effective for fiscal years beginning after December 15, 2016. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

In February 2016, the FASB issued ASU 2016-02, Lease Accounting, which requires lessees to recognize on the balance sheet certain operating and financing lease liabilities and corresponding right-of-use assets that have lease terms of greater than 12 months. This topic retains the distinction between finance leases and operating leases. The ASU is effective on a modified retrospective approach for annual periods beginning after December 15, 2018, and interim periods therein, with early adoption permitted. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results, noting that we currently expect the majority of our operating lease commitments will be subject to the new standard and recognized as operating lease liabilities and right-of-use assets upon our adoption of ASU 2016-02.

In November 2015, the FASB issued ASU 2015-17, Income Taxes, which provides guidance for the presentation of deferred tax assets and liabilities within the statement of financial position. The ASU requires companies to classify deferred tax assets and liabilities as noncurrent in a classified statement of financial position. The current requirement that deferred tax assets and liabilities of a tax-paying component of an entity be offset and presented as a single amount is not affected by the amendments in this ASU. The ASU simplifies the current guidance, which requires entities to separate deferred income tax assets and liabilities into current and noncurrent amounts in a classified statement of financial position. The ASU is effective prospectively or retrospectively for annual periods beginning after December 15, 2016, and interim periods therein, with early adoption permitted. The adoption of the ASU will change the classification of deferred income taxes within our Consolidated Balance Sheets; however, we do not expect the adoption of the ASU to have a material impact on our results of operations or cash flows.

In July 2015, the FASB issued ASU 2015-11, Inventory, which provides guidance for the measurement of inventory. The ASU requires entities to measure most inventory at the lower of cost or net realizable value. The ASU simplifies the current guidance, which requires entities to measure inventory at the lower of cost or market (with market defined as one of three different measures). The ASU is effective prospectively for annual and interim periods beginning after December 15, 2016, and interim periods therein. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which provides guidance for revenue recognition that supersedes existing revenue recognition guidance (but does not apply to nor supersede accounting guidance for lease contracts). The ASU’s core principle is that an entity will recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In July 2015, the FASB approved a proposal to defer the effective date of the ASU by one year to reporting periods beginning after December 15, 2018. The ASU should be applied retrospectively to each prior reporting period presented or retrospectively with the cumulative effect of initially applying the ASU recognized at the date of initial application. We are currently in the process of evaluating the impact of the adoption of this ASU on our consolidated results.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

12 Months Ended

Mar. 31, 2016

Accounting Policies [Abstract]

Schedule of Allowance for Uncollectible Accounts for Accounts Receivable

The activity in the allowance for uncollectible accounts for accounts receivable is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,897		$	1,988
Provisions charged to expense		40			287
Deductions for amounts written-off		(143	)		(378	)
Balance at end of period	$	1,794		$	1,897

Components of Inventories

Inventories consist of the following at March 31 ($ in thousands):

	2016		2015
Raw materials and sub-assemblies	$	35,770	$	41,045
Finished goods		64,127		77,763
Parts, garments and accessories		40,110		33,635
	$	140,007	$	152,443

Changes in Accrued Warranty Liability

The following represents changes in our accrued warranty liability for the fiscal years 2016, 2015 and 2014 ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	23,062		$	19,357		$	18,709
Warranty provision		13,864			21,499			16,770
Warranty claim payments		(12,117	)		(17,794	)		(16,122	)
Balance at end of period	$	24,809		$	23,062		$	19,357

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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

12 Months Ended

Mar. 31, 2016

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Notional Amounts and Gross Carrying Values of Derivative Instruments

The following table presents the notional amounts and gross carrying values of derivative instruments as of March 31, 2016 and March 31, 2015 ($ in thousands):

	March 31, 2016					March 31, 2015
	Notional Amount (in US Dollars)		Fair Value Asset (Liability), Net (2)			Notional Amount (in US Dollars)		Fair Value Asset (Liability), Net (2)
Canadian Dollar (1)	$	87,875	$	(3,837	)	$	76,328	$	3,628
Japanese Yen (1)		—		—			19,046		(434	)

(1) Assets are included in other current assets and liabilities are included in accrued expenses in the accompanying Consolidated Balance Sheets.

(2) Refer to Note 2, Fair Value Measurements, for additional information on the fair value of our derivative instruments.

Summary of Effects of Derivative Instruments on Other Comprehensive Income (OCI) and Consolidated Statements of Operations

The following table presents the effects of derivative instruments on other comprehensive income (OCI) and on our Consolidated Statements of Operations for the years ended March 31, 2016, 2015 and 2014 ($ in thousands):

	March 31, 2016						March 31, 2015
	Pre-Tax Gain (Loss) Recognized in OCI			Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)			Pre-Tax Gain (Loss) Recognized in OCI		Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)
Canadian Dollar (1)	$	(111	)	$	7,354		$	6,047	$	1,996
Japanese Yen (1)		(374	)		(808	)		—		—

(1) Canadian Dollar contracts are included in general and administrative expenses and Japanese Yen contracts are included in cost of goods sold in the accompanying Consolidated Statements of Operations.

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GOODWILL AND INTANGIBLE ASSETS (Tables)

12 Months Ended

Mar. 31, 2016

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Carrying Amount of Goodwill

The changes in the carrying amount of goodwill for the years ended March 31, 2016 and 2015 are as follows ($ in thousands):

	2016		2015
	Gross Carrying Amount		Gross Carrying Amount
Balance as of beginning of year	$	3,342	$	—
Goodwill acquired during the period		—		3,342
Balance as of end of year	$	3,342	$	3,342

Summary of Carrying Amount of Indefinite-Lived Intangible Assets

The carrying amount of indefinite-lived intangible assets as of March 31, 2016 and 2015 are as follows ($ in thousands):

	2016		2015
	Gross Carrying Amount		Gross Carrying Amount
Indefinite-lived intangible asset balance as of end of year	$	436	$	436

Summary of Changes in Net Carrying Amount of Definite-Lived Intangible Assets

For definite-lived intangible assets, the changes in the net carrying amount for the years ended March 31, 2016 and 2015 are as follows ($ in thousands):

	2016					2015
	Gross Carrying Amount		Accumulated Amortization			Gross Carrying Amount			Accumulated Amortization
Balance as of beginning of year	$	4,312	$	(1,511	)	$	2,058		$	(1,428	)
Intangible assets acquired during the period		—		—			2,255			—
Amortization expense		—		(385	)		—			(83	)
Currency translation effect on foreign balances		3		—			(1	)		—
Balance as of end of year	$	4,315	$	(1,896	)	$	4,312		$	(1,511	)

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LEASES (Tables)

12 Months Ended

Mar. 31, 2016

Leases [Abstract]

Schedule of Future Minimum Lease Payments

Future minimum lease payments, exclusive of other costs required under non-cancelable operating leases are as follows ($ in thousands):

Fiscal year
2017	$	1,490
2018		1,383
2019		1,248
2020		1,234
2021		1,182
Thereafter		9,042
Total future minimum payments	$	15,579

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SHAREHOLDERS' EQUITY (Tables)

12 Months Ended

Mar. 31, 2016

Stock Option Activity

The following tables summarize the stock option transactions under the Plans during fiscal 2016:

	Number of Shares Under Option			Weighted Average Exercise Price
Outstanding at March 31, 2015		604,218		$	29.39
Granted		121,819			29.57
Cancelled		(10,356	)		36.39
Expired		(30	)		13.59
Exercised		(37,442	)		15.52
Outstanding at March 31, 2016		678,209		$	30.08
Options exercisable at March 31, 2016		262,734		$	17.83
Options expected to vest at March 31, 2016		266,806		$	20.30

Assumptions Used to Determine Fair Value of Stock Options/SARs Issued

The weighted average fair value of options granted and the assumptions used to estimate the fair value of options for fiscal 2016, 2015 and 2014 are summarized as follows:

	2016			2015			2014
Fair value of options granted	$	13.35		$	15.24		$	16.91
Assumptions:
Dividend yield		1.2	%		1.0	%		1.0	%
Average term		6 years			6 years			5 years
Volatility		51.0	%		49.0	%		49.0	%
Risk-free rate of return		1.7	%		0.8	%		0.8	%

Summary of Activity for SARs Awarded

The following table summarizes the activity during fiscal 2016 for SARs awarded pursuant to the Plans:

	Number of SARs		Weighted Average Exercise Price		Weighted Average Contractual Term
Outstanding at March 31, 2015		—	$	—
Granted		175,000		14.16
Forfeited		—		—
Exercised		—		—
Outstanding at March 31, 2016		175,000	$	14.16		4.9 years
SARs exercisable at March 31, 2016		—	$	—		—
SARs expected to vest at March 31, 2016		144,468	$	14.16		4.9 years

Schedule of Weighted Average Shares Outstanding

Weighted average shares outstanding consist of the following for the fiscal 2016, 2015 and 2014 (in thousands):

	2016		2015		2014
Weighted average number of common shares outstanding		12,995		12,926		13,275
Dilutive effect of option plan		—		163		323
Common and potential shares outstanding—diluted		12,995		13,089		13,598

Components of Changes in Accumulated Other Comprehensive Loss

The components of the changes in accumulated other comprehensive loss during fiscal 2016, 2015 and 2014 were as follows ($ in thousands):

	2016			2015			2014
Balance at beginning of period	$	(7,142	)	$	(2,110	)	$	(4,166	)
Unrealized gain (loss) on derivative instruments, net of tax		(4,429	)		2,279			(241	)
Foreign currency translation adjustment		1,387			(7,311	)		2,297
Balance at end of period	$	(10,184	)	$	(7,142	)	$	(2,110	)

Options Outstanding and Exercisable

Stock Option Activity

The following tables summarize information concerning currently outstanding and exercisable stock options at March 31, 2016:

Range of Exercise Prices	Number Outstanding		Weighted Average Remaining Contractual Life		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price
$6.26 - 9.57		3,827		3.34 years	$	6.28		3,827	$	6.28
10.79 - 16.45		145,762		5.09 years		13.97		132,180		13.71
17.78 - 27.69		63,051		7.40 years		21.29		48,029		21.72
28.81 - 43.79		432,035		8.32 years		35.65		160,645		38.21
47.52 - 47.52		33,534		7.63 years		47.52		12,228		47.52
		678,209		7.48 years	$	30.08		356,909	$	26.90

Stock Appreciation Rights

Assumptions Used to Determine Fair Value of Stock Options/SARs Issued

The fair value of the SAR grant was estimated using the Black-Scholes option pricing model and assumptions analogous to our stock option awards, as set forth in the table below:

	2016
Fair value of SARs granted	$	6.40
Assumptions:
Dividend yield		0.0	%
Average term		5 years
Volatility		51.0	%
Risk-free rate of return		1.4	%

Restricted Shares

Restricted Stock Activity

	2016					2015
Restricted Shares	Shares			Weighted- Average Grant  Date Fair Value		Shares			Weighted- Average Grant  Date Fair Value
Non-vested shares at March 31,		22,500		$	40.12		16,200		$	43.45
Awarded		29,063			18.53		20,200			33.67
Vested		(9,800	)		48.75		(10,900	)		33.81
Forfeited		(1,900	)		24.84		(3,000	)		37.60
Non-vested shares at March 31,		39,863		$	22.98		22,500		$	40.12

Restricted Stock Units

Restricted Stock Activity

	2016					2015
Restricted Stock Units	Shares			Weighted- Average Grant  Date Fair Value		Shares			Weighted- Average Grant  Date Fair Value
Non-vested shares at March 31,		116,439		$	35.67		40,103		$	35.35
Granted		124,558			18.09		135,564			34.81
Vested		(44,722	)		36.15		(57,295	)		33.14
Forfeited		(10,017	)		16.59		(1,933	)		43.81
Non-vested shares at March 31,		186,258		$	24.79		116,439		$	35.67

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INCOME TAXES (Tables)

12 Months Ended

Mar. 31, 2016

Income Tax Disclosure [Abstract]

Schedule of Income(Loss) Before Income Tax

Our income (loss) before income taxes was generated from our United States and foreign operations as follows ($ in thousands):

	For the years ended March 31,
	2016			2015		2014
United States	$	(17,156	)	$	5,532	$	58,655
Foreign		109			678		1,749
Income (loss) before income taxes	$	(17,047	)	$	6,210	$	60,404

Schedule of Income Tax Expense (Benefit)

Income tax expense (benefit) consists of the following for the fiscal years ended March 31 ($ in thousands):

	2016			2015			2014
Current
Federal	$	(5,935	)	$	2,610		$	13,345
State		(339	)		149			900
Foreign		27			168			436
Deferred		(1,613	)		(1,637	)		6,319
Total income tax expense (benefit)	$	(7,860	)	$	1,290		$	21,000

Reconciliation of Federal Statutory Income Tax Rate to Effective Tax Rate

The following is a reconciliation of the federal statutory income tax rate to the effective tax rate for the fiscal years ended March 31:

	2016			2015			2014
Statutory income tax rate		35.0	%		35.0	%		35.0	%
State taxes		1.8			1.9			1.7
Research and other tax credit		5.6			(16.5	)		(1.0	)
Domestic manufacturers deduction		(0.1	)		(0.9	)		(1.4	)
Uncertain tax positions		6.0			(2.3	)		(0.1	)
US subpart F adjustments		0.7			11.1			0.4
Foreign tax rate difference		(1.4	)		(9.1	)		(0.2	)
Stock options		(0.5	)		1.3			(0.1	)
Other		(1.1	)		0.3			0.5
		46.0	%		20.8	%		34.8	%

Cumulative Temporary Differences Between Tax Bases of Assets and Liabilities and their Carrying Amounts

The cumulative temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes under the liability method are as follows at March 31 ($ in thousands):

	2016			2015
Current deferred income tax assets
Accrued expenses	$	3,788		$	3,934
Accrued warranty		8,855			8,045
Inventory related items		4,269			4,152
Net operating loss carryforwards		1,628			—
Other		1,560			313
Less: valuation allowance		(351	)		(235	)
Current deferred income tax asset		19,749			16,209
Current deferred income tax liabilities
Prepaid expenses		2,043			1,463
Other		477			1,696
Current deferred income tax liability		2,520			3,159
Net current deferred tax asset	$	17,229		$	13,050
Non-current deferred income tax assets
Compensation payable in common stock	$	1,927		$	1,200
State research and development credits		1,393			1,043
Less: valuation allowance		(1,042	)		(808	)
Non-current deferred income tax asset		2,278			1,435
Non-current deferred income tax liability
Property and equipment		15,471			11,151
Non-current deferred tax liability		15,471			11,151
Net non-current deferred tax liability	$	13,193		$	9,716

Schedule of Unrecognized Tax Benefits

A reconciliation of the amount of unrecognized tax benefits excluding interest and penalties is as follows ($ in thousands):

	2016			2015
Balance at beginning of period	$	1,828		$	1,707
Increases related to prior year tax positions		50			72
Decreases related to prior year tax positions		(1,033	)		(143	)
Increases related to current year tax positions		200			192
Settlements		—			—
Balance at end of period	$	1,045		$	1,828

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SEGMENT REPORTING (Tables)

12 Months Ended

Mar. 31, 2016

Segment Reporting [Abstract]

Schedule of Segment Information

We aggregate our snowmobile and ATV/ROV operating segments into one operating segment, as the segments have similar economic characteristics. Given the crossover of customers, manufacturing and asset management, we do not maintain separate balance sheets for each segment. Accordingly, the segment information presented below is limited to sales and gross profit data ($ in thousands).

	Years ended March 31,
	2016		2015		2014
Net sales
Snowmobile and ATV/ROV units	$	534,600	$	584,873	$	615,608
PG&A		98,295		113,883		114,883
Total net sales		632,895		698,756		730,491
Cost of goods sold
Snowmobile and ATV/ROV units		476,194		505,383		506,707
PG&A		66,034		73,924		72,705
Total cost of goods sold		542,228		579,307		579,412
Gross profit
Snowmobile and ATV/ROV units		58,406		79,490		108,901
PG&A		32,261		39,959		42,178
Total gross profit	$	90,667	$	119,449	$	151,079

	Years ended March 31,
	2016		2015		2014
Net sales by product line
Snowmobile units	$	258,788	$	300,731	$	282,442
ATV/ROV units		275,812		284,142		333,166
PG&A		98,295		113,883		114,883
Total net sales	$	632,895	$	698,756	$	730,491

	Years ended March 31,
	2016		2015		2014
Net sales by geography, based on location of the customer
United States	$	395,684	$	420,687	$	404,347
Canada		174,658		192,524		215,631
Europe and other		62,553		85,545		110,513
Total net sales	$	632,895	$	698,756	$	730,491

Schedule of Property and Equipment, Net by Geography

Property and equipment, net, by geography are presented in the table below ($ in thousands):

	Years ended March 31,
	2016		2015
Long-lived assets by geography
United States	$	88,623	$	69,113
Canada and Europe		223		336
Total long-lived assets	$	88,846	$	69,449

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QUARTERLY FINANCIAL DATA (Unaudited) (Tables)

12 Months Ended

Mar. 31, 2016

Quarterly Financial Information Disclosure [Abstract]

Schedule of Quarterly Financial Information

($ in thousands, except per share amounts)	Total Year			First Quarter			Second Quarter		Third Quarter			Fourth Quarter
Net Sales
2016	$	632,895		$	134,381		$	211,157	$	166,000		$	121,357
2015		698,756			143,639			262,479		193,735			98,903
2014		730,491			120,768			238,525		225,790			145,408
Gross Profit (Loss)
2016	$	90,667		$	22,562		$	43,918	$	24,250		$	(63	)
2015		119,449			30,801			55,081		34,913			(1,346	)
2014		151,079			29,160			61,674		40,213			20,032
Net Earnings (Loss)
2016	$	(9,187	)	$	(1,056	)	$	11,171	$	(2,397	)	$	(16,905	)
2015		4,920			3,569			15,389		7,487			(21,525	)
2014		39,404			5,468			23,365		12,120			(1,549	)
Net Earnings (Loss) Per Share
2016 Basic	$	(0.71	)	$	(0.08	)	$	0.86	$	(0.18	)	$	(1.30	)
Diluted		(0.71	)		(0.08	)		0.85		(0.18	)		(1.30	)
2015 Basic		0.38			0.28			1.19		0.58			(1.66	)
Diluted		0.38			0.27			1.18		0.57			(1.66	)
2014 Basic		2.97			0.41			1.75		0.90			(0.12	)
Diluted		2.90			0.40			1.70		0.89			(0.12	)

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Summary of Significant Accounting Policies - Additional Information (Detail)	12 Months Ended
	Mar. 31, 2016 USD ($) Reporting_unit	Mar. 31, 2015 USD ($)	Mar. 31, 2014 USD ($)	Mar. 31, 2013 USD ($)
Significant Accounting Policies [Line Items]
Cash and cash equivalents	$ 17,730,000	$ 40,253,000	$ 22,524,000	$ 35,566,000
Allowance for uncollectible accounts	1,794,000	1,897,000	1,988,000
Impairment charge of long-lived assets recognized	$ 0	0	0
Number of reporting units | Reporting_unit	4
Company's dealer holdback program liability	$ 17,200,000	19,800,000
Research and development expense	27,162,000	24,341,000	23,998,000
Cooperate advertising expense	3,000,000	3,600,000	3,400,000
Total advertising expense	$ 19,500,000	18,600,000	$ 17,600,000
Percentage of likelihood for realization of benefit upon ultimate settlement to recognize income tax benefit minimum	50.00%
Minimum | Buildings and Improvements
Significant Accounting Policies [Line Items]
Estimated service lives	15 years
Minimum | Machinery and Equipment
Significant Accounting Policies [Line Items]
Estimated service lives	5 years
Minimum | Tooling
Significant Accounting Policies [Line Items]
Estimated service lives	3 years
Maximum | Buildings and Improvements
Significant Accounting Policies [Line Items]
Estimated service lives	39 years
Maximum | Machinery and Equipment
Significant Accounting Policies [Line Items]
Estimated service lives	15 years
Maximum | Tooling
Significant Accounting Policies [Line Items]
Estimated service lives	5 years
Allowance for Uncollectible Accounts
Significant Accounting Policies [Line Items]
Allowance for uncollectible accounts	$ 1,800,000	1,900,000
Europe and Canada
Significant Accounting Policies [Line Items]
Cash and cash equivalents	$ 7,200,000	$ 19,200,000

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Summary of Significant Accounting Policies - Schedule of Allowance for Uncollectible Accounts for Accounts Receivable (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Receivables [Abstract]
Balance at beginning of period	$ 1,897	$ 1,988
Provisions charged to expense	40	287
Deductions for amounts written-off	(143)	(378)
Balance at end of period	$ 1,794	$ 1,897

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Summary of Significant Accounting Policies - Components of Inventories (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015
Inventory Disclosure [Abstract]
Raw materials and sub-assemblies	$ 35,770	$ 41,045
Finished goods	64,127	77,763
Parts, garments and accessories	40,110	33,635
Inventory, Total	$ 140,007	$ 152,443

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Summary of Significant Accounting Policies - Changes in Accrued Warranty Liability (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Product Warranties Disclosures [Abstract]
Product Warranty Accrual, Beginning of period	$ 23,062	$ 19,357	$ 18,709
Warranty provision	13,864	21,499	16,770
Warranty claim payments	(12,117)	(17,794)	(16,122)
Product Warranty Accrual, End of period	$ 24,809	$ 23,062	$ 19,357

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Fair Value Measurements - Additional Information (Detail) - USD ($)	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets measured at fair value on nonrecurring basis	$ 0	$ 0
Fair Value, Inputs, Level 2 | Canadian Dollar Foreign Currency Contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency contract fair value asset	100,000	3,600,000
Foreign currency contract fair value liability	$ 3,900,000
Fair Value, Inputs, Level 2 | Japanese Yen Foreign Currency Contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency contract fair value liability		$ 400,000

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Derivative Instruments and Hedging Activities - Additional Information (Detail) - Forward Currency Contracts	12 Months Ended
	Mar. 31, 2016
Canadian Dollar
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Foreign currency forward contracts maximum term	12 months
Japanese Yen
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Foreign currency forward contracts maximum term	12 months

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Derivative Instruments and Hedging Activities - Schedule of Notional Amounts and Gross Carrying Values of Derivative Instruments (Detail) - Forward Currency Contracts - USD ($)	Mar. 31, 2016	Mar. 31, 2015
Canadian Dollar
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional Amount	$ 87,875,000	$ 76,328,000
Fair Value Asset	$ 3,837,000	3,628,000
Japanese Yen
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional Amount		19,046,000
Fair Value Asset (Liability)		$ (434,000)

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Derivative Instruments and Hedging Activities - Summary of Effects of Derivative Instruments on Other Comprehensive Income (OCI) and Consolidated Statements of Operations (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Canadian Dollar
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Pre-Tax Gain (Loss) Recognized in OCI	$ (111)	$ 6,047
Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)	7,354	$ 1,996
Japanese Yen
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Pre-Tax Gain (Loss) Recognized in OCI	(374)
Pre-Tax Gain (Loss) Reclassified from Accumulated OCI to Earnings (Effective Portion)	$ (808)

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Goodwill and Intangible Assets - Summary of Carrying Amount of Goodwill (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Balance as of beginning of year	$ 3,342
Goodwill acquired during the period	0	$ 3,342
Balance as of end of year	$ 3,342	$ 3,342

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Goodwill and Intangible Assets - Summary of Carrying Amount of Indefinite-Lived Intangible Assets (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015
Indefinite-Lived Intangible Assets (Excluding Goodwill) [Abstract]
Indefinite-lived intangible asset balance as of end of year	$ 436	$ 436

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Goodwill and Intangible Assets - Summary of Changes in Net Carrying Amount of Definite-Lived Intangible Assets (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Balance as of beginning of year, Gross Carrying Amount	$ 4,312	$ 2,058
Intangible assets acquired during the period, Gross Carrying Amount		2,255
Amortization expense, Gross Carrying Amount	0	0
Currency translation effect on foreign balances, Gross Carrying Amount	3	(1)
Balance as of end of year, Gross Carrying Amount	4,315	4,312
Balance as of beginning of year, Accumulated Amortization	(1,511)	(1,428)
Intangible assets acquired during the period, Accumulated Amortization	0	0
Amortization expense, Accumulated Amortization	(385)	(83)
Currency translation effect on foreign balances, Accumulated Amortization	0	0
Balance as of end of year, Accumulated Amortization	$ (1,896)	$ (1,511)

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Goodwill and Intangible Assets - Additional Information (Detail) $ in Millions	Mar. 31, 2016 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense, in fiscal 2017	$ 0.4
Amortization expense, in fiscal 2018	0.4
Amortization expense, in fiscal 2019	0.4
Amortization expense, in fiscal 2020	0.4
Amortization expense, in fiscal 2021	$ 0.3

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Financing - Additional Information (Detail) - USD ($)	12 Months Ended
	Mar. 31, 2016	Mar. 10, 2016	Mar. 31, 2015
Line of Credit Facility [Line Items]
Line of credit Interest rate description	Borrowings under the line are subject to certain covenants and restrictions on indebtedness, financial guarantees, business combinations and other related items. We were in compliance with the terms of the credit agreement as of March 31, 2016.
Senior Secured Revolving Credit Facility
Line of Credit Facility [Line Items]
Maturity date	Mar. 10, 2021
Senior secured revolving credit agreement description	We amended our credit facility to extend the maturity date from November 10, 2017 to March 10, 2021 and increase our maximum permissible borrowings from $100.0 million to $130.0 million during May through November and from $50.0 million to $75.0 million during all other months of the fiscal year.
Line of Credit
Line of Credit Facility [Line Items]
Outstanding letters of credit balances	$ 0		$ 0
Letter of Credit
Line of Credit Facility [Line Items]
Outstanding letters of credit balances	3,500,000		$ 7,900,000
Minimum | Senior Secured Revolving Credit Facility | May through November
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity value		$ 100,000,000
Minimum | Senior Secured Revolving Credit Facility | All other months
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity value	$ 50,000,000
Minimum | Senior Secured Revolving Credit Facility | LIBOR Loans [Member]
Line of Credit Facility [Line Items]
Line of credit, basis spread variable rate	1.00%
Minimum | Senior Secured Revolving Credit Facility | Base Rate Loans
Line of Credit Facility [Line Items]
Line of credit, basis spread variable rate	0.00%
Maximum | Senior Secured Revolving Credit Facility | May through November
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity value		$ 130,000,000
Maximum | Senior Secured Revolving Credit Facility | All other months
Line of Credit Facility [Line Items]
Line of credit facility maximum borrowing capacity value	$ 75,000,000
Maximum | Senior Secured Revolving Credit Facility | LIBOR Loans [Member]
Line of Credit Facility [Line Items]
Line of credit, basis spread variable rate	1.50%
Maximum | Senior Secured Revolving Credit Facility | Base Rate Loans
Line of Credit Facility [Line Items]
Line of credit, basis spread variable rate	0.50%

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Leases - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Leases, Operating [Abstract]
Total rent expense under lease agreement	$ 1.4	$ 1.9	$ 1.4

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Leases - Schedule of Future Minimum Lease Payments (Detail) $ in Thousands	Mar. 31, 2016 USD ($)
Leases, Operating [Abstract]
Future minimum lease payments, 2017	$ 1,490
Future minimum lease payments, 2018	1,383
Future minimum lease payments, 2019	1,248
Future minimum lease payments, 2020	1,234
Future minimum lease payments, 2021	1,182
Future minimum lease payments, Thereafter	9,042
Total future minimum payments	$ 15,579

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Shareholders' Equity - Additional Information (Detail) - USD ($)	1 Months Ended	12 Months Ended
	Feb. 29, 2016	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014	Aug. 07, 2014	May. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares available for grant		620,703
Stock-based compensation expense		$ 4,294,000	$ 4,087,000	$ 2,584,000
Unrecognized compensation costs related to non-vested stock options, restricted stock awards and SARs awards		$ 9,300,000
Compensation expense related to non-vested stock options, restricted stock and SARs awards, weighted average period of recognition		2 years
Stock options outstanding, aggregate intrinsic value		$ 500,000	$ 5,300,000	$ 10,900,000
Stock options outstanding, weighted-average contractual life		7 years 5 months 23 days	8 years 11 days	5 years 1 month 2 days
Stock options exercisable, aggregate intrinsic value		$ 400,000
Stock options exercisable, weighted-average contractual life		6 years 3 months 26 days
Volatility look back period		6 years
Stock and option grants, forfeiture rate		10.00%
Preferred stock, authorized for issuance		2,050,000	2,050,000
Preferred stock, par value		$ 1.00	$ 1.00
Preferred stock, shares issued		0	0
Value of shares repurchased and canceled		$ 100,000	$ 1,000,000	$ 28,200,000
Number of shares repurchased and canceled		5,162	27,925	633,816
Stock repurchase program remaining authorized repurchase value		$ 25,900,000				$ 1,100,000
Stock repurchase program authorized repurchase value					$ 25,000,000
Unrealized gains on derivative instruments, tax expense		2,600,000	$ 1,300,000	$ 100,000
Tax impact on foreign currency translation adjustments		$ 0
Stock Option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Options to purchase common stock excluded from computation of net earnings (loss) per share		449,432	156,432	0
Common stock option, weighted average exercise prices		$ 35.50	$ 44.14
Preferred Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Preferred stock, authorized for issuance		2,500,000
Preferred stock, par value		$ 1.00
Preferred stock, shares issued		0
Preferred Stock - Series B Junior Participating
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Preferred stock, authorized for issuance		450,000	450,000
Preferred stock, par value		$ 1.00	$ 1.00
Preferred stock, shares issued		0	0
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares awarded		29,063	20,200
Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock appreciation rights granted, vesting period	5 years	3 years
Stock options outstanding, weighted-average contractual life		4 years 10 months 24 days
Number of shares awarded	175,000
Stock Options, Restricted Stocks And Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense		$ 4,300,000	$ 4,100,000	$ 2,600,000
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock appreciation rights granted, vesting period		1 year
Stock options awards, expiration period		5 years
Minimum | Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock appreciation rights granted, vesting period		2 years
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock appreciation rights granted, vesting period		3 years
Stock options awards, expiration period		10 years
Current market value of common stock	$ 33.00
Maximum | Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock appreciation rights granted, vesting period		3 years

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Shareholders' Equity - Stock Option Transactions Under Plans (Detail)	12 Months Ended
	Mar. 31, 2016 $ / shares shares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Number of Shares, Outstanding beginning balance | shares	604,218
Number of Shares Under Option, Granted | shares	121,819
Number of Shares Under Option, Cancelled | shares	(10,356)
Number of Shares Under Option, Expired | shares	(30)
Number of Shares Under Option, Exercised | shares	(37,442)
Number of Shares Under Option, Outstanding ending balance | shares	678,209
Number of Shares Under Option, Options exercisable | shares	262,734
Number of Shares Under Option, Options exercisable | shares	266,806
Weighted Average Exercise Price, Outstanding beginning balance | $ / shares	$ 29.39
Weighted Average Exercise Price, Granted | $ / shares	29.57
Weighted Average Exercise Price, Cancelled | $ / shares	36.39
Weighted Average Exercise Price, Expired | $ / shares	13.59
Weighted Average Exercise Price, Exercised | $ / shares	15.52
Weighted Average Exercise Price, Outstanding ending balance | $ / shares	30.08
Weighted Average Exercise Price, Options exercisable | $ / shares	17.83
Weighted Average Exercise Price, Options exercisable | $ / shares	$ 20.30

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Shareholders' Equity - Summary of Information Concerning Currently Outstanding and Exercisable Stock Options (Detail) - $ / shares	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number Outstanding	678,209
Weighted Average Remaining Contractual Life	7 years 5 months 23 days	8 years 11 days	5 years 1 month 2 days
Weighted Average Exercise Price	$ 30.08
Number Exercisable	262,734
Weighted Average Exercise Price	$ 17.83
6.26 - 9.57
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Range of Exercise Prices, Minimum	6.26
Range of Exercise Prices, Maximum	$ 9.57
Number Outstanding	3,827
Weighted Average Remaining Contractual Life	3 years 4 months 2 days
Weighted Average Exercise Price	$ 6.28
Number Exercisable	3,827
Weighted Average Exercise Price	$ 6.28
10.79 - 16.45
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Range of Exercise Prices, Minimum	10.79
Range of Exercise Prices, Maximum	$ 16.45
Number Outstanding	145,762
Weighted Average Remaining Contractual Life	5 years 1 month 2 days
Weighted Average Exercise Price	$ 13.97
Number Exercisable	132,180
Weighted Average Exercise Price	$ 13.71
17.78 - 27.69
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Range of Exercise Prices, Minimum	17.78
Range of Exercise Prices, Maximum	$ 27.69
Number Outstanding	63,051
Weighted Average Remaining Contractual Life	7 years 4 months 24 days
Weighted Average Exercise Price	$ 21.29
Number Exercisable	48,029
Weighted Average Exercise Price	$ 21.72
28.81 - 43.79
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Range of Exercise Prices, Minimum	28.81
Range of Exercise Prices, Maximum	$ 43.79
Number Outstanding	432,035
Weighted Average Remaining Contractual Life	8 years 3 months 26 days
Weighted Average Exercise Price	$ 35.65
Number Exercisable	160,645
Weighted Average Exercise Price	$ 38.21
47.52 - 47.52
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Range of Exercise Prices, Minimum	47.52
Range of Exercise Prices, Maximum	$ 47.52
Number Outstanding	33,534
Weighted Average Remaining Contractual Life	7 years 7 months 17 days
Weighted Average Exercise Price	$ 47.52
Number Exercisable	12,228
Weighted Average Exercise Price	$ 47.52

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Shareholders' Equity - Assumptions Used to Determine Fair Value of Stock Options Issued (Detail) - $ / shares	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Fair value of options granted	$ 13.35	$ 15.24	$ 16.91
Dividend yield	1.20%	1.00%	1.00%
Average term	6 years	6 years	5 years
Volatility	51.00%	49.00%	49.00%
Risk-free rate of return	1.70%	0.80%	0.80%

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Shareholders' Equity - Restricted Stock Activity (Detail) - $ / shares	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Restricted Shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested shares, Beginning balance	22,500	16,200
Awarded	29,063	20,200
Vested	(9,800)	(10,900)
Forfeited	(1,900)	(3,000)
Non-vested shares, Ending balance	39,863	22,500
Non-vested shares, Weighted-Average Grant Date Fair Value Beginning	$ 40.12	$ 43.45
Awarded	18.53	33.67
Vested	48.75	33.81
Forfeited	24.84	37.60
Non-vested shares, Weighted-Average Grant Date Fair Value Ending	$ 22.98	$ 40.12
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Non-vested shares, Beginning balance	116,439	40,103
Awarded	124,558	135,564
Vested	(44,722)	(57,295)
Forfeited	(10,017)	(1,933)
Non-vested shares, Ending balance	186,258	116,439
Non-vested shares, Weighted-Average Grant Date Fair Value Beginning	$ 35.67	$ 35.35
Awarded	18.09	34.81
Vested	36.15	33.14
Forfeited	16.59	43.81
Non-vested shares, Weighted-Average Grant Date Fair Value Ending	$ 24.79	$ 35.67

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Shareholders' Equity - Summary of Activity for SARs Awarded (Detail) - $ / shares	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of Shares, Outstanding beginning balance	604,218
Number of SARs, Granted	121,819
Number of SARs, Forfeited	(30)
Number of SARs, Exercised	(37,442)
Number of Shares Under Option, Outstanding ending balance	678,209	604,218
Number of SARs, exercisable at March 31, 2016	262,734
Weighted Average Exercise Price, Outstanding beginning balance	$ 30.08	$ 29.39
Weighted Average Exercise Price, Granted	29.57
Weighted Average Exercise Price, Forfeited	13.59
Weighted Average Exercise Price, Exercised	15.52
Weighted Average Exercise Price, Outstanding ending balance	30.08	$ 29.39
Weighted Average Exercise Price, exercisable at March 31, 2016	$ 17.83
Stock options outstanding, weighted-average contractual life	7 years 5 months 23 days	8 years 11 days	5 years 1 month 2 days
Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of SARs, Granted	175,000
Number of SARs, Forfeited	0
Number of SARs, Exercised	0
Number of Shares Under Option, Outstanding ending balance	175,000
Number of SARs, exercisable at March 31, 2016	0
Number of SARs, expected to vest at March 31, 2016	144,468
Weighted Average Exercise Price, Outstanding beginning balance	$ 14.16
Weighted Average Exercise Price, Granted	14.16
Weighted Average Exercise Price, Forfeited	0
Weighted Average Exercise Price, Exercised	0
Weighted Average Exercise Price, Outstanding ending balance	14.16
Weighted Average Exercise Price, exercisable at March 31, 2016	0
Weighted Average Exercise Price, expected to vest at March 31, 2016	$ 14.16
Stock options outstanding, weighted-average contractual life	4 years 10 months 24 days
Weighted Average Contractual Term, SARs expected to vest	4 years 10 months 24 days

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Shareholders' Equity - Assumptions Used to Determine Fair Value of Stock Options/SARs Issued (Detail) - $ / shares	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of SARs granted	$ 13.35	$ 15.24	$ 16.91
Dividend yield	1.20%	1.00%	1.00%
Average term	6 years	6 years	5 years
Volatility	51.00%	49.00%	49.00%
Risk-free rate of return	1.70%	0.80%	0.80%
Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of SARs granted	$ 6.40
Dividend yield	0.00%
Average term	5 years
Volatility	51.00%
Risk-free rate of return	1.40%

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Shareholders' Equity - Schedule of Weighted Average Shares Outstanding (Detail) - shares shares in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Weighted Average Number of Shares Outstanding, Diluted [Abstract]
Weighted average number of common shares outstanding	12,995	12,926	13,275
Dilutive effect of option plan		163	323
Common and potential shares outstanding-diluted	12,995	13,089	13,598

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Shareholders' Equity - Components of Changes in Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Equity [Abstract]
Balance at beginning of period	$ (7,142)	$ (2,110)	$ (4,166)
Unrealized gain (loss) on derivative instruments, net of tax	(4,429)	2,279	(241)
Foreign currency translation adjustment	1,387	(7,311)	2,297
Balance at end of period	$ (10,184)	$ (7,142)	$ (2,110)

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Retirement Savings Plan - Additional Information (Detail) - USD ($)	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Compensation and Retirement Disclosure [Abstract]
Employees contribution towards retirement plan, percentage	50.00%
Matching contribution by the employer, percentage	50.00%
Maximum percentage of employee compensation, that the employer may contribute towards the plan	5.00%
Maximum contribution by employees towards retirement plan	$ 255,000
Matching contribution by the employer	$ 1,300,000	$ 1,200,000	$ 1,000,000
Defined contribution plan coverage, description	We sponsor a 401(k) defined contribution plan that covers substantially all full-time employees who are at least 18 years of age and who have completed at least three months of service.
Defined contribution plan, minimum service period	3 months

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Income Taxes - Schedule of Income (Loss) Before Income Tax (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Income Tax Disclosure [Abstract]
United States	$ (17,156)	$ 5,532	$ 58,655
Foreign	109	678	1,749
Income (loss) before income taxes	$ (17,047)	$ 6,210	$ 60,404

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Income Taxes - Schedule of Income Tax Expense (Benefit) (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Income Tax Disclosure [Abstract]
Federal	$ (5,935)	$ 2,610	$ 13,345
State	(339)	149	900
Foreign	27	168	436
Deferred	(1,613)	(1,637)	6,319
Total income tax expense (benefit)	$ (7,860)	$ 1,290	$ 21,000

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Income Taxes - Reconciliation of Federal Statutory Income Tax Rate to Effective Tax Rate (Detail)	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Income Tax Disclosure [Abstract]
Statutory income tax rate	35.00%	35.00%	35.00%
State taxes	1.80%	1.90%	1.70%
Research and other tax credit	5.60%	(16.50%)	(1.00%)
Domestic manufacturers deduction	(0.10%)	(0.90%)	(1.40%)
Uncertain tax positions	6.00%	(2.30%)	(0.10%)
US subpart F adjustments	0.70%	11.10%	0.40%
Foreign tax rate difference	(1.40%)	(9.10%)	(0.20%)
Stock options	(0.50%)	1.30%	(0.10%)
Other	(1.10%)	0.30%	0.50%
Reconciliation of federal income tax rate, total	46.00%	20.80%	34.80%

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Income Taxes - Cumulative Temporary Differences Between Tax Bases of Assets and Liabilities and their Carrying Amounts (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015
Current deferred income tax assets
Accrued expenses	$ 3,788	$ 3,934
Accrued warranty	8,855	8,045
Inventory related items	4,269	4,152
Net operating loss carryforwards	1,628
Other	1,560	313
Less: valuation allowance	(351)	(235)
Current deferred income tax asset	17,229	13,050
Current deferred income tax liabilities
Prepaid expenses	2,043	1,463
Other	477	1,696
Current deferred income tax liability	2,520	3,159
Net current deferred tax asset	17,229	13,050
Non-current deferred income tax assets
Compensation payable in common stock	1,927	1,200
State research and development credits	1,393	1,043
Less: valuation allowance	(1,042)	(808)
Non-current deferred income tax asset	2,278	1,435
Non-current deferred income tax liability
Property and equipment	15,471	11,151
Non-current deferred tax liability	15,471	11,151
Net non-current deferred tax liability	$ 13,193	$ 9,716

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Income Taxes - Additional Information (Detail) - USD ($) $ in Millions	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Income Tax Disclosure [Line Items]
Liabilities related to unrecognized tax benefits	$ 1.1	$ 2.2
Unrecognized tax benefits, potential interest and penalties	0.1	0.4
Anticipated recognized portion of unrecognized tax benefits	$ 0.3
Percentage of likelihood of tax benefit realized	Greater than 50%
Tax credit carryforward, expiration period	March 2031
State and Local Jurisdiction [Member]
Income Tax Disclosure [Line Items]
State research and development credits carryforwards	$ 1.4	$ 1.0

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Income Taxes - Schedule of Unrecognized Tax Benefits (Detail) - USD ($) $ in Thousands	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance at beginning of period	$ 1,828	$ 1,707
Increases related to prior year tax positions	50	72
Decreases related to prior year tax positions	(1,033)	(143)
Increases related to current year tax positions	200	192
Settlements	0	0
Balance at end of period	$ 1,045	$ 1,828

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Commitments and Contingencies - Additional Information (Detail)	Mar. 31, 2016 USD ($)
Loss Contingencies [Line Items]
Maximum repurchase amount repossessed products sold to dealers	$ 68,500,000
Purchase obligation under the non-cancelable purchase commitments	45,100,000
Loss Sharing Provisions
Loss Contingencies [Line Items]
Maximum repurchase amount repossessed products sold to dealers	$ 2,200,000

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Segment Reporting - Additional Information (Detail) - Segment	12 Months Ended
	Mar. 31, 2016	Mar. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Number of operating segments	2
Number of reportable segments	2
Percentage of sales to individual customer accounted for more than 10%	No sales to an individual customer accounted for more than 10% of fiscal year 2014 net sales.
Yamaha And Subsidiaries
Revenues from External Customers and Long-Lived Assets [Line Items]
Aggregate sales percentage		10.40%

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Segment Reporting - Schedule of Segment Information (Detail) - USD ($) $ in Thousands	3 Months Ended												12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Segment Reporting Information [Line Items]
Net sales	$ 121,357	$ 166,000	$ 211,157	$ 134,381	$ 98,903	$ 193,735	$ 262,479	$ 143,639	$ 145,408	$ 225,790	$ 238,525	$ 120,768	$ 632,895	$ 698,756	$ 730,491
Cost of goods sold													542,228	579,307	579,412
Gross profit	$ (63)	$ 24,250	$ 43,918	$ 22,562	$ (1,346)	$ 34,913	$ 55,081	$ 30,801	$ 20,032	$ 40,213	$ 61,674	$ 29,160	90,667	119,449	151,079
United States
Segment Reporting Information [Line Items]
Net sales													395,684	420,687	404,347
Canada
Segment Reporting Information [Line Items]
Net sales													174,658	192,524	215,631
Europe and other
Segment Reporting Information [Line Items]
Net sales													62,553	85,545	110,513
Snowmobile units - Product line
Segment Reporting Information [Line Items]
Net sales													258,788	300,731	282,442
ATV/ROV units - Product line
Segment Reporting Information [Line Items]
Net sales													275,812	284,142	333,166
Parts, garments & accessories - Product line
Segment Reporting Information [Line Items]
Net sales													98,295	113,883	114,883
Snowmobile and ATV/ROV units
Segment Reporting Information [Line Items]
Net sales													534,600	584,873	615,608
Cost of goods sold													476,194	505,383	506,707
Gross profit													58,406	79,490	108,901
Parts, garments and accessories
Segment Reporting Information [Line Items]
Net sales													98,295	113,883	114,883
Cost of goods sold													66,034	73,924	72,705
Gross profit													$ 32,261	$ 39,959	$ 42,178

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Segment Reporting - Schedule of Property and Equipment, Net by Geography (Detail) - USD ($) $ in Thousands	Mar. 31, 2016	Mar. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-lived assets	$ 88,846	$ 69,449
United States
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-lived assets	88,623	69,113
Europe and Canada
Revenues from External Customers and Long-Lived Assets [Line Items]
Long-lived assets	$ 223	$ 336

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New Market Tax Credit Transaction - Additional Information (Detail) $ in Millions	1 Months Ended
	Feb. 29, 2016 USD ($)
Variable Interest Entity [Line Items]
Contribution amount recorded in other liabilities	$ 5.3
Percentage of recapture to which the tax credits are subject	100.00%
Tax credit recapture period	7 years
Financing arrangement	$ 0.9
Other Liabilities [Member]
Variable Interest Entity [Line Items]
Contribution amount recorded in other liabilities	$ 5.3
Wells Fargo Community Development Enterprises, Inc.
Variable Interest Entity [Line Items]
Maximum percentage of a qualified investment available as credit against federal income taxes	39.00%
Arctic Cat Sales Inc.
Variable Interest Entity [Line Items]
Loan receivable from investment fund	$ 10.8
Loan receivable from investment fund, interest rate	3.75%
Loan maturity date	Jun. 30, 2032
Arctic Cat Production Support LLC
Variable Interest Entity [Line Items]
Interest rate	3.106%

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Quarterly Financial Data (Unaudited) - Schedule of Quarterly Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended												12 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2016	Mar. 31, 2015	Mar. 31, 2014
Quarterly Financial Information Disclosure [Abstract]
Net sales	$ 121,357	$ 166,000	$ 211,157	$ 134,381	$ 98,903	$ 193,735	$ 262,479	$ 143,639	$ 145,408	$ 225,790	$ 238,525	$ 120,768	$ 632,895	$ 698,756	$ 730,491
Gross Profit (Loss)	(63)	24,250	43,918	22,562	(1,346)	34,913	55,081	30,801	20,032	40,213	61,674	29,160	90,667	119,449	151,079
Net earnings (loss)	$ (16,905)	$ (2,397)	$ 11,171	$ (1,056)	$ (21,525)	$ 7,487	$ 15,389	$ 3,569	$ (1,549)	$ 12,120	$ 23,365	$ 5,468	$ (9,187)	$ 4,920	$ 39,404
Net Earnings (Loss) Per Share, Basic	$ (1.30)	$ (0.18)	$ 0.86	$ (0.08)	$ (1.66)	$ 0.58	$ 1.19	$ 0.28	$ (0.12)	$ 0.90	$ 1.75	$ 0.41	$ (0.71)	$ 0.38	$ 2.97
Net Earnings (Loss) Per Share, Diluted	$ (1.30)	$ (0.18)	$ 0.85	$ (0.08)	$ (1.66)	$ 0.57	$ 1.18	$ 0.27	$ (0.12)	$ 0.89	$ 1.70	$ 0.40	$ (0.71)	$ 0.38	$ 2.90