11-K 1 c63484e11-k.txt ANNUAL REPORT DATED 12/31/00 1 ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 -------------------- FORM 11-K [X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1933 FOR THE TRANSITION PERIOD FROM _____ TO ______ --------------------- COMMISSION FILE NO. 333 - 94451 --------------------- A. FULL TITLE OF THE PLAN AND THE ADDRESS OF THE PLAN, IF DIFFERENT FROM THAT OF THE ISSUER NAMED BELOW: POLARIS 401(k) RETIREMENT SAVINGS PLAN --------------------- B. NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN AND THE ADDRESS OF ITS PRINCIPAL EXECUTIVE OFFICE: POLARIS INDUSTRIES INC. 2100 HIGHWAY 55 MEDINA, MINNESOTA 55340 -------------------- ================================================================================ 2 POLARIS 401(k) RETIREMENT SAVINGS PLAN REPORT ON AUDITS OF FINANCIAL STATEMENTS as of December 31, 2000 and 1999 and SUPPLEMENTARY SCHEDULE as of December 31, 2000 and for the year then ended INDEX
Page ---- Report of Independent Public Accountants 1 Financial Statements: Statements of net assets available for benefits as of December 31, 2000 and 1999 2 Statement of changes in net assets available for benefits for the year ended December 31, 2000 3 Notes to Financial Statements 4 Supplemental Schedule: Schedule of assets held for investment purposes 7 as of December 31, 2000
i 3 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Plan Administrator of Polaris 401(k) Retirement Savings Plan: We have audited the accompanying statements of net assets available for benefits of Polaris 401(k) Retirement Savings Plan as of December 31, 2000 and 1999, and the related statement of changes in net assets available for benefits for the years ended December 31, 2000 and 1999. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the 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 financial statements referred to above present fairly, in all material respects, the net assets available for benefits of Polaris 401(k) Retirement Savings Plan as of December 31, 2000 and 1999, and the changes in net assets available for benefits for the year ended December 31, 2000 and 1999, in conformity with accounting principles generally accepted in the United States. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets (held at end of year) is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule is the responsibility of the Plan's management. The supplemental schedule has been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, is fairly stated in all material respects, in relation to the basic financial statements taken as a whole. Arthur Andersen LLP Minneapolis, Minnesota, May 11, 2001 1 4 POLARIS 401(k) RETIREMENT SAVINGS PLAN Statements of net assets available for benefits As of December 31
2000 1999 ------------ ----------- ASSETS: Investments, at fair value $103,264,077 $92,271,928 Accrued income receivable 3,363 1,603 ------------ ----------- Total assets 103,267,440 92,273,531 LIABILITIES: Investment transactions pending (40,690) (3,892) ------------ ----------- NET ASSETS AVAILABLE FOR BENEFITS $103,226,750 $92,269,639 ============ ===========
The accompanying notes are an integral part of these statements. 2 5 POLARIS 401(k) RETIREMENT SAVINGS PLAN Statement of changes in net assets available for benefits For the years ended December 31, 2000 and 1999
2000 1999 ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, beginning of year $92,269,639 $75,019,764 ------------ ------------ INCREASES DURING THE YEAR: Contributions- Employer 5,284,560 4,970,338 Employee 7,801,311 6,939,566 Rollover 1,114,182 462,820 ------------ ----------- Total contributions 14,200,053 12,372,724 ------------ ----------- Investment income- Interest and dividend income 7,953,846 3,979,847 Realized gains/(losses) on sale of investments (3,107,528) 9,431,033 Unrealized depreciation in market value of investments, net (2,020,202) (3,546,246) ------------ ----------- Total investment income 2,826,116 9,864,634 ------------- ----------- DISTRIBUTIONS TO PARTICIPANTS (6,040,454) (4,970,414) ADMINISTRATIVE EXPENSES (28,604) (17,069) ------------ ----------- Total deductions (6,069,058) (4,987,483) ------------ ----------- Net increase 10,957,111 17,249,875 ------------ ----------- NET ASSETS AVAILABLE FOR BENEFITS, end of year $103,226,750 $92,269,639 ============ ===========
The accompanying notes are an integral part of these statements. 3 6 POLARIS 401(k) RETIREMENT SAVINGS PLAN Notes to financial statements December 31, 2000 and 1999 1 DESCRIPTION OF THE PLAN The following description of Polaris 401(k) Retirement Savings Plan (the Plan) provides only general information. Participants should refer to the plan agreement for a more complete description of the Plan's provisions. GENERAL The Plan is a defined contribution plan covering substantially all employees of the Plan's sponsor, Polaris Industries Inc. (the Company). Effective January 1, 1999, employees from Polaris Sales, Inc. are also included in the Plan. It is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). PLAN OPERATIONS Certain administrative costs totaling $143,428 and $120,998 for the plan years ended December 31, 2000 and 1999, respectively, were paid by the Company. Administrative costs paid by the Company include trustee/asset custodian fees, record keeping fees, investment management fees, and legal fees. PLAN ADMINISTRATION The Plan's trustee, Fidelity Management Trust Company (the Trustee), holds and invests the assets of the Plan and also distributes the retirement benefits upon instruction from the plan administrator. The Plan is administered by an executive committee appointed by the board of directors of the Company. CONTRIBUTIONS/PARTICIPANT ACCOUNTS Participants may elect to make contributions (limited to a maximum of 15 percent of the participant's compensation, as defined in the Plan) to their account balances. The Company makes a corresponding 100 percent discretionary matching contribution of up to a maximum of 5 percent of the employee's compensation. Effective January 1, 2000, the Company will make a fully-vested matching contribution to each participant's account in the Plan of 100 percent of each dollar of 401(k) contributions up to 5 percent of covered compensation. This contribution is intended to satisfy a safe harbor contribution formula permitted by IRS regulations. By making the safe harbor matching contribution, the Plan will automatically satisfy the nondiscrimination requirements which otherwise would apply to 401(k) contributions made to the Plan. Effective for the year ended December 31, 1999, the Company matched 100 percent of the first 4 percent of the employee's compensation. Plan earnings, as defined, are allocated pro rata based on participants' account balances. 4 7 VESTING Participants are immediately vested in their pretax and employer contributions, plus actual earnings thereon. PARTICIPANT LOANS Participants may apply for loans from the Plan in amounts of the lesser of 50 percent of their vested account balances or $50,000. Loans must be paid back within 5 years; however, this period may be extended to 10 years if the loan is utilized for the acquisition of a primary residence. The interest rate charged on loans outstanding ranged from 9.75 to 11.50 percent as of December 31, 2000 and was 9.5 percent as of December 31, 1999. DISTRIBUTIONS TO PARTICIPANTS Employee account balances are distributable upon retirement, disability, death, termination from the Company or hardship. Upon the occurrence of one of these events, a participant (or the participant's beneficiary in the case of death) may receive his or her account balance as a lump-sum payment or in monthly payments through an annuity as available per plan provisions. PLAN AMENDMENT AND TERMINATION The Company has the right to amend or terminate the Plan, subject to the provisions of ERISA. In the event of the Plan's termination, all assets of the Plan will be distributed to participants in accordance with plan provisions. 2 SIGNIFICANT ACCOUNTING POLICIES AND PROCEDURES BASIS OF ACCOUNTING The accompanying financial statements have been prepared on the accrual basis of accounting. INVESTMENT VALUATION AND INCOME RECOGNITION Investments of the Plan are stated at fair value. Shares of registered investment companies are valued at quoted market prices, which represent the net asset value of shares held by the Plan at year-end. Realized gains and losses on sales of investments represent the difference between the net proceeds from the sale of investments and their market values at the beginning of the year or original cost if purchased during the year. Unrealized appreciation or depreciation of investments represents changes in the market value of investments since the beginning of the year. Purchases and sales of securities are reflected on a trade-date basis. Interest income is recognized when earned. Dividend income is recorded on the ex-dividend date. 5 8 USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the Plan's management to make estimates and assumptions that affect the reported amounts of net assets available for benefits at the date of the financial statements and the reported amounts of changes in net assets available for benefits during the year. Ultimate results could differ from those estimates. 3 INVESTMENT OPTIONS The investment options of the Plan at December 31, 2000 consist of deposits with fifteen funds managed by the Trustee, four externally managed funds, and the Polaris Stock Fund. The investment options of the Plan at December 31, 1999 consist of deposits with three funds managed by the Trustee, three externally managed funds and the Polaris Stock Fund. Participants elect to have their account balances invested in one or more of the following funds and may change the fund investment mix daily via a voice response system or the Internet. The following presents investments that represent 5 percent or more of the Plan's net assets as of December 31:
2000 1999 ----------- ----------- Neuberger Berman Genesis Trust $13,718,272 $ 9,430,503 Fidelity Puritan Fund 10,981,224 10,013,023 Fidelity Dividend Growth Fund 22,169,138 -- Fidelity Managed Income Portfolio 14,897,461 14,061,617 Spartan U.S. Equity Fund 29,297,686 31,357,548
4 TAX STATUS The Internal Revenue Service has determined and informed the Company by a letter dated October 27, 1997, that the Plan is designed in accordance with applicable sections of the Internal Revenue Code (the Code). Although the Plan has been amended since receiving the determination letter, the plan administrator and the Plan's tax counsel believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code. 5 PARTY-IN-INTEREST TRANSACTIONS The Plan invests in Fidelity funds and Polaris Industries Inc. stock. These transactions qualify as exempt party-in-interest transactions. 6 9 SUPPLEMENTAL SCHEDULE POLARIS 401(k) RETIREMENT SAVINGS PLAN Schedule of assets held for investment purposes As of December 31, 2000 EIN: 41-1797637 PLAN NUMBER: 001
Description Cost Current value ----------- ---- ------------- Fidelity Management Trust Company* Institutional Cash Portfolio ** $ 29,401 ------------ Pimco Total Return Fund ** 80,338 Franklin Small Cap Growth Fund ** 497,305 Neuberger Berman Genesis Trust ** 13,718,272 Polaris Industries, Inc. Common Stock* ** 844,529 Fidelity Puritan Fund* ** 10,981,224 Fidelity Growth Company Fund* ** 526,502 Fidelity Blue Chip Growth Fund* ** 394,177 Fidelity Aggressive Growth Fund* ** 714,684 Fidelity Diversified International Fund* ** 4,450,211 Fidelity Dividend Growth Fund* ** 22,169,138 Fidelity Freedom Income Fund* ** 10,187 Fidelity Freedom 2000 Fund* ** 19,076 Fidelity Freedom 2010 Fund* ** 74,772 Fidelity Freedom 2020 Fund* ** 303,455 Fidelity Freedom 2030 Fund* ** 135,377 Fidelity Managed Income Portfolio* ** 14,897,461 Spartan U.S. Equity Fund ** 29,297,686 Fidelity Freedom 2040 Fund* ** 177,215 ------------ Total investment funds 99,291,609 Participant loans, with interest rates ranging from 9.75% to 11.50%* 3,943,067 ------------ Total investments $103,264,077 ============
* Denotes party in interest. **Historical cost is omitted for participant-directed investments. 7 10 POLARIS 401(k) RETIREMENT SAVINGS PLAN EXHIBITS
Exhibit No. Description ----------- ----------- 23.1 Consent of Arthur Andersen LLP
8 11 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: June 27, 2001 POLARIS 401(k) RETIREMENT SAVINGS PLAN By the Members of the 401(k) Retirement Committee as Plan Administrator /s/ Thomas C. Tiller ----------------------------------------- Thomas C. Tiller /s/ Michael W. Malone ----------------------------------------- Michael W. Malone /s/ John B. Corness ----------------------------------------- John B. Corness /s/ Thomas J. Rooney ----------------------------------------- Thomas J. Rooney 9 12 POLARIS 401(k) RETIREMENT SAVINGS PLAN EXHIBIT INDEX
Number Document Method of Filing ------ -------- ---------------- 23.1 Consent of Arthur Andersen LLP Filed herewith electronically
10