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INCENTIVE COMPENSATION
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
INCENTIVE COMPENSATION INCENTIVE COMPENSATION
The Company sponsors short-term incentive plans that provide the grant of either cash or stock-based bonus awards payable upon achievement of specified performance goals. As of December 31, 2023, the Company has accrued $26.6 million, $27.5 million and $8.1 million related to cash bonus awards that are recognized in the U.S., U.K & Europe, and Mexico reportable segments, respectively.
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 liability-based awards to the Company’s officers and other employees, members of the Board of Directors and any consultants (the “LTIP”). 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 and restricted stock units (“RSUs”). Equity-based awards are converted into shares of the Company’s common stock shortly after award vesting. Compensation cost to be recognized for an equity-based awards grant is determined by multiplying the number of awards granted by the closing price of a share of the Company’s common stock on the award grant date. Liability-based awards granted under the LTIP are converted into cash shortly after award vesting. Compensation cost to be recognized for a liability-based awards grant is first determined by multiplying the number of awards granted by the closing price of a share of PPC’s common stock on the award grant date. However, the compensation cost to be recognized is adjusted at each subsequent milestone date (i.e., forfeiture date, vesting date or financial reporting date) by multiplying the number of awards granted by the closing price of a share of PPC’s common stock on the milestone date. On May 1, 2019, the Company’s stockholders approved the Pilgrim’s Pride Corporation 2019 Long Term Incentive Plan (the “2019 LTIP”), which replaced the expiring Pilgrim’s Pride Corporation 2009 Long-Term Incentive Plan (the “2009 LTIP”). The 2019 LTIP became effective as of December 28, 2019. As of December 31, 2023, we have in reserve approximately 0.5 million shares of common stock for future issuance under the 2019 LTIP.
Compensation costs and the income tax benefit recognized for our stock-based compensation arrangements are included below:
202320222021
(In thousands)
Equity-based awards compensation cost:
Cost of sales$629 $959 $3,209 
Selling, general and administrative expense6,958 5,904 7,420 
Total cost7,587 6,863 10,629 
Income tax benefit1,836 1,671 2,587 
Net cost$5,751 $5,192 $8,042 
Liability-based awards compensation cost:
Selling, general and administrative expense$2,491 $1,773 $7,715 
Income tax benefit603 432 1,878 
Net cost$1,888 $1,341 $5,837 
The Company’s RSU activity is included below:
202320222021
Number
Weighted Average Milestone Date Fair Value(a)
Number
Weighted Average Milestone Date Fair Value(a)
Number
Weighted Average Milestone Date Fair Value(a)
(In thousands, except weighted average fair values)
Equity-based RSUs:
Outstanding at beginning of year993 $22.00 554 $20.40 584 $22.12 
Transferred to liability-based awards— — — — (8)23.53 
Granted324 23.67 405 23.88 817 21.58 
Vested(378)22.25 (266)23.25 (153)19.48 
Awards reinstated (forfeited)(28)24.99 300 23.52 (686)23.44 
Outstanding at end of year911 $22.40 993 $22.00 554$20.40 
202320222021
Number
Weighted Average Milestone Date Fair Value(a)
Number
Weighted Average Milestone Date Fair Value(a)
Number
Weighted Average Milestone Date Fair Value(a)
(In thousands, except weighted average fair values)
Liability-based RSUs:
Outstanding at beginning of year377 $23.80 574 $27.55 267 $19.35 
Transferred from equity-based awards— — — — 8 23.53 
Granted158 24.21 269 22.09 358 21.61 
Vested(196)25.27 (139)27.55 (59)20.10 
Forfeited(97)22.81 (327)24.71 — — 
Outstanding at end of year242 $27.66 377 $23.80 574 $27.55 
(a)The milestone date fair value is either the closing price of the Company’s common stock on the grant date for equity-based awards or the closing price of a share of the Company’s common stock on the respective milestone date for cash-based liability-based awards (i.e., grant date, vesting date, forfeiture date or financial reporting date).
The total fair values of equity-based awards and liability-based awards vested during 2023 were $9.3 million and $5.0 million, respectively. The total fair values of equity-based awards and liability-based awards vested during 2022 were $7.5 million and $5.6 million, respectively.
As of December 31, 2023, the total unrecognized compensation cost related to all nonvested equity-based awards was $9.0 million. This cost is expected to be recognized over a weighted average period of 1.93 years. As of December 31, 2023, the total unrecognized compensation cost related to all nonvested liability-based awards was $4.1 million. This cost is expected to be recognized over a weighted average period of 1.73 years.
Historically, we have issued new shares, as opposed to treasury shares, to satisfy equity-based award conversions.