Pilgrim's has been and, in some cases, continues to be a party to certain transactions with affiliated companies.



	2016		2015		2014
	(In thousands)
JBS USA Food Company Holding:
Letter of credit fees^(a)	$	202	$	1,268	$	1,339
Capital contribution under tax sharing agreement^(b)	5,038		3,690		3,849
JBS USA Food Company:
Purchases from JBS USA Food Company^(c)	139,476		103,542		115,337
Expenditures paid by JBS USA Food Company on behalf of Pilgrim’s Pride Corporation^(d)	40,519		40,611		31,149
Sales to JBS USA Food Company^(c)	16,534		21,743		39,682
Expenditures paid by Pilgrim’s Pride Corporation on behalf of JBS USA Food Company^(d)	10,586		3,998		4,925
Seara International Ltd.:
Purchases from Seara International Ltd.	2,746		2,784		2,091
JBS Global (UK) Ltd.:
Sales to JBS Global (UK) Ltd.	122		305		255
JBS Chile Ltda.:
Sales to JBS Chile Ltda.	615		100		463
Macedo Agroindustrial Ltda.:
Purchases from Macedo Agroindustrial Ltda.	—		60		—
JBS Aves Ltda.:
Purchases from JBS Aves Ltda.	—		—		4,072
JBS Five Rivers:
Sales to JBS Five Rivers	14,126		—		—
J&F Investimentos Ltd.:
Sales to J&F Investimentos Ltd.	69		—		—

(a)

JBS USA Food Company Holdings (“JBS USA Holdings”) arranged for letters of credit to be issued on its account in the aggregate amount of $56.5 million to an insurance company on our behalf in order to allow that insurance company to return cash it held as collateral against potential workers’ compensation, auto liability and general liability claims. In return for providing this letter of credit, the Company has agreed to reimburse JBS USA Holdings for the letter of credit fees the Company would otherwise incur under its U.S. Credit Facility. The letter of credit arrangements for $40.0 million and $16.5 million were terminated on March 7, 2016 and April 1, 2016, respectively. During 2016, the Company paid JBS USA Holdings $0.2 million for letter of credit fees.


(b)	The Company entered into a tax sharing agreement during 2014 with JBS USA Holdings effective for tax years starting 2010. The net tax receivable for tax year 2016 was accrued in 2016 and will be paid in 2017. The net tax receivable for tax year 2015 was accrued in 2015 and paid in January 2016. The net tax receivable for tax years 2010 through 2014 was accrued in 2014 and paid in January 2015.

(c)

We routinely execute transactions to both purchase products from JBS USA Food Company (“JBS USA”) and sell products to them. As of December 25, 2016 and December 27, 2015, the outstanding payable to JBS USA was $1.4 million and $7.0 million, respectively. As of December 25, 2016 and December 27, 2015, the outstanding receivable from JBS USA was $3.8 million and $2.6 million, respectively. As of December 25, 2016, approximately $2.9 million of goods from JBS USA were in transit and not reflected on our Consolidated Balance Sheet.

(d)

The Company has an agreement with JBS USA to allocate costs associated with JBS USA’s procurement of SAP licenses and maintenance services for both companies. Under this agreement, the fees associated with procuring SAP licenses and maintenance services are allocated between the Company and JBS USA in proportion to the percentage of licenses used by each company. The agreement expires on the date of expiration, or earlier termination, of the underlying SAP license agreement. The Company also has an agreement with JBS USA to allocate the costs of supporting the business operations by one consolidated corporate team, which have historically been supported by their respective corporate teams. Expenditures paid by JBS USA on behalf of the Company will be reimbursed by the Company and expenditures paid by the Company on behalf of JBS USA will be reimbursed by JBS USA. This agreement expires on December 31, 2019.