INCENTIVE COMPENSATION

12 Months Ended

Dec. 25, 2016

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

INCENTIVE COMPENSATION

INCENTIVE COMPENSATION

The Company sponsors a short-term incentive plan that provides the grant of either cash or share-based bonus awards payable upon achievement of specified performance goals (the “STIP”). Full-time, salaried exempt employees of the Company and its affiliates who are selected by the administering committee are eligible to participate in the STIP. The Company has accrued $28.9 million in costs related to the STIP at December 25, 2016 related to cash bonus awards that could potentially be awarded during 2017.

The Company also sponsors a performance-based, omnibus long-term incentive plan that provides for the grant of a broad range of long-term equity-based and cash-based awards to the Company’s officers and other employees, members of the Board and any consultants (the “LTIP”). The equity-based awards that may be granted under the LTIP include “incentive stock options,” within the meaning of the IRC, nonqualified stock options, stock appreciation rights, restricted stock awards (“RSAs”) and restricted stock units (“RSUs”). At December 25, 2016, we have reserved approximately 5.0 million shares of common stock for future issuance under the LTIP.

The following awards were outstanding during 2016:

Award Type

Benefit Plan

Awards Granted

Grant Date

Grant Date Fair Value per Award(a)

Vesting Condition

Vesting Date

Estimated Forfeiture Rate

Awards Forfeited to Date

Settlement Method

RSU

LTIP

449,217

02/19/2014

$

16.70

Service

12/31/2016

13.49

%

86,458

Stock

RSU

LTIP

223,701

03/03/2014

17.18

Performance / Service

12/31/2017

12.34

%

55,516

Stock

DER

(b)

LTIP

45,961

02/11/2015

25.87

Performance / Service

12/31/2017

12.34

%

—

Stock

RSU

LTIP

158,226

02/26/2015

27.51

Performance / Service

12/31/2018

(c)

158,226

Stock

RSU

LTIP

251,136

03/30/2016

25.36

Performance / Service

12/31/2019

(d)

—

Stock

DER

(b)

LTIP

74,535

10/13/2016

20.93

Service

12/31/2016

13.49

%

—

Stock

(a) The fair value of each RSA and RSU granted or vested represents the closing price of the Company’s common stock on the respective grant date or vesting date.

(b) On February 17, 2015, the Company paid a special cash dividend to stockholders of record as of January 30, 2015 totaling $5.77 per share. On January 27, 2015, the Compensation Committee of the Company’s Board of Directors agreed to grant Dividend Equivalent Rights (“DERs”) in the form of RSUs to reflect an additional $5.77 in value for each outstanding RSU.

(c) Performance conditions associated with these awards were not satisfied. Therefore, 100% of the awards were forfeited.

(d) The estimated forfeiture rate for these awards will be set if or when performance conditions associated with the awards are satisfied.

Compensation costs and the income tax benefit recognized for our share-based compensation arrangements are included below:

	2016		2015		2014
	(In thousands)
Share-based compensation cost:
Cost of goods sold	$	770	$	596	$	395
Selling, general and administrative expenses	5,332		2,379		4,533
Total	$	6,102	$	2,975	$	4,928
Income tax benefit	$	1,858	$	868	$	1,326

The Company’s RSA and RSU activity is included below:

	2016				2015				2014
	Number		Weighted Average Grant Date Fair Value		Number		Weighted Average Grant Date Fair Value		Number		Weighted Average Grant Date Fair Value
	(In thousands, except weighted average fair values)
RSAs:
Outstanding at beginning of year	—		$	—	30		$	8.72	203		$	6.59
Granted	—		—		—		—		—		—
Vested	—		—		—		—		(173	)	6.62
Forfeited	—		—		(30	)	8.72		—		—
Outstanding at end of year	—		$	—	—		$	—	30		$	8.72
RSUs:
Outstanding at beginning of year	774		$	18.78	1,120		$	11.97	729		$	8.81
Granted	325		24.35		428		21.00		463		16.70
Vested	—		—		(671	)	8.81		—		—
Forfeited	(193	)	24.51		(103	)	18.90		(72	)	10.34
Outstanding at end of year	906		$	20.00	774		$	18.78	1,120		$	11.97

The total fair value of awards vested in 2015 and 2014 was $22.4 million and $3.2 million, respectively. No awards vested in 2016.

At December 25, 2016, the total unrecognized compensation cost related to all nonvested awards was $8.6 million. That cost is expected to be recognized over a weighted average period of 2.49 years.

Historically, we have issued new shares to satisfy award conversions.