We have equity-based compensation plans that authorize the issuance of equity-based awards for shares of Class A and Class B common stock to directors, officers and key employees. Equity-based compensation grants are designed to reward long-term contributions to Moog and provide incentives for recipients to remain with Moog.

We have an Employee Stock Purchase Plan ("ESPP") that allows for qualified employees (as defined in the plan) to purchase our common stock at a price equal to 85% of the fair market value at the lower of the beginning or the end of the semi-annual offering period.

The 2014 Long Term Incentive Plan ("2014 Plan") authorizes the issuance of a total of 2,000,000 shares of either Class A or Class B common stock. The 2014 Plan is intended to provide a flexible framework that permits the development and implementation of a variety of equity-based programs that base awards on key performance metrics as well as align our long term incentive compensation with our peers and shareholder interests.

During 2023, we granted awards in the form of performance-based restricted stock units ("PSUs"), time vested restricted stock units ("TVAs") and restricted stock awards ("RSAs"). The compensation cost for employee and non-employee director equity-based compensation programs for all current and prior year awards granted are as follows:


	2023		2022		2021
Stock appreciation rights	$	1,584	$	2,370	$	2,345
Performance-based restricted stock units	2,479		1,718		1,151
Time vested restricted stock units	2,461		1,423		602
Restricted stock awards	1,102		850		730
Employee stock purchase plan	2,956		2,521		2,633

Total compensation cost before income taxes	$	10,582	$	8,882	$	7,461
Income tax benefit	$	1,156	$	970	$	893

PSU awards consist of shares of our stock which are payable upon the determination that we achieve certain established performance targets and can range from 0% to 200% of the targeted payout based on the actual results. PSU's granted in 2023 have a performance period of three years. The fair value of each PSU granted is equal to the fair market value of our common stock on the date of grant. PSUs granted generally have a cliff vesting schedule of three years; however, according to the grant agreements, if certain conditions are met, the employee (or beneficiary) will receive a prorated amount of the award based on active employment during the service period.

PSUs are as follows:


Performance-Based Restricted Stock Units	Number of Awards	Weighted- Average Grant Date Fair Value
Nonvested at October 1, 2022	58,444	$	78.41
Granted in 2023	40,949	85.17
Vested in 2023	(27,077)	73.39
Forfeited in 2023	(2,417)	80.29

Nonvested at September 30, 2023	69,899	$	84.25

As of September 30, 2023, total unvested compensation expense associated with nonvested PSUs amounted to $3,232 and will be recognized over a weighted-average period of two years.

The number of Class B shares to be issued for PSU awards granted in 2021 that vested based on the achievement of performance targets in 2023, will be approximately 26,800 shares.

TVAs consist of shares of our stock which are payable over a vesting schedule determined at the time the award is granted. TVAs vest in equal fixed dollar tranches over the agreed upon vesting term beginning one year after the date of the grant and will settle using the fair market value of shares on the date of vesting of the tranche. Although it is our intention to settle vested amount in shares, we reserve the right to settle in cash at our discretion.


Time Vested Restricted Stock Units	Number of Awards	Weighted- Average Fair Value
Nonvested at October 1, 2022	54,559	$	71.40
Granted in 2023	39,920	85.17
Vested in 2023	(17,768)	86.21
Forfeited in 2023	(1,220)	105.13
Decrease due to fair value change in 2023	(25,446)	n/a
Nonvested at September 30, 2023	50,045	$	112.72

As of September 30, 2023, total unvested compensation expense associated with nonvested TVAs amounted to $3,373 and will be recognized over a weighted-average period of one year.

The number of Class B shares to be issued for TVAs that are expected to vest in 2023 from time based service conditions is approximately 23,000 shares, based on our closing price of Class B common stock of $112.72 as of September 30, 2023.

The fair value of each RSA granted is equal to the fair market value of our common stock on the date of grant. These shares vest and are issued upon grant. There were 12,464 RSAs granted and vested in 2023 at a price of $88.38 resulting in a fair value of the RSAs vested of $1,102.


Employee Stock Purchase Plan	2023		2022		2021
Shares issued	155,704		139,121		141,647
Weighted-average price per share	$	70.91	$	67.91	$	58.52

The fair value of SARs granted was estimated on the date of grant using the Black-Scholes option-pricing model. In 2023, there were no SARs granted. The following table provides the range of assumptions used to value awards and the weighted-average fair value of the awards granted.


	2022			2021
Expected volatility	39% - 40%			38% - 41%
Risk-free rate	1.3		%	0.4% - 0.5%
Expected dividends	1.2		%	1.4		%
Expected term	5-6 years			5-6 years
Weighted-average fair value of awards granted	$	27.86		$	23.11

To determine expected volatility, we generally use historical volatility based on daily closing prices of our Class A and Class B common stock over periods that correlate with the expected terms of the awards granted. The risk-free rate is based on the U.S. Treasury yield curve at the time of grant for the appropriate expected term of the awards granted. Expected dividends are based on our history and expectation of dividend payouts. The expected term of equity-based awards is based on vesting schedules, expected exercise patterns and contractual terms.

The number of shares received upon the exercise of a SAR is equal in value to the difference between the fair market value of the common stock on the exercise date and the exercise price of the SAR. The term of a SAR may not

exceed ten years from the grant date. The exercise price of SARs and options, determined by a committee of the Board of Directors, may not be less than the fair value of the common stock on the grant date.

SARs are as follows:


Stock Appreciation Rights	Number of Awards	Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life	Aggregate Intrinsic Value
Outstanding at October 1, 2022	858,503	$	73.67
Exercised in 2023	(152,698)	57.85
Expired in 2023	(1,736)	85.95
Forfeited in 2023	(2,559)	79.59
Outstanding at September 30, 2023	701,510	$	77.06	4.7 years	$	25,045
Exercisable at September 30, 2023	614,012	$	76.66	4.2 years	$	22,169

The aggregate intrinsic value in the preceding tables represents the total pre-tax intrinsic value, based on our closing price of Class A common stock of $112.96 and Class B common stock of $112.72 as of September 30, 2023. That value would have been effectively received by the SAR holders had all SARs been exercised as of that date.

The intrinsic value of awards exercised and fair value of awards vested are as follows:


Stock Appreciation Rights	2023		2022		2021
Intrinsic value of SARs exercised	$	5,596	$	3,777	$	3,833
Total fair value of SARs vested	$	2,426	$	2,346	$	2,558

As of September 30, 2023, total unvested compensation expense associated with SARs amounted to $1,013 and will be recognized over a weighted-average period of one year.