Stock-Based Compensation

9 Months Ended

Sep. 30, 2017

6. Stock-based Compensation

During the nine months ended September 30, 2017, we granted stock only stock appreciation rights (“SOSARs”) on 304 shares of our common stock to eligible employees. The weighted average grant date fair value of the SOSARs was $105.97 per share with a weighted average exercise price of $426.70 per share based on the closing price of common stock on the date of grant. The SOSARs vest in two equal installments on the second and third anniversary of the grant date. During the nine months ended September 30, 2017, 32 SOSARs were exercised and 124 SOSARs were forfeited.

During the nine months ended September 30, 2017, we granted restricted stock units (“RSUs”) on 89 shares of our common stock to eligible employees. The weighted average grant date fair value of the RSUs was $427.30 per share. The RSUs generally vest in two equal installments on the second and third anniversary of the grant date.

During the first quarter of 2017, we awarded 36 performance shares (“PSUs”) that are subject to service, market and performance vesting conditions. Two-thirds of the PSUs had a grant date fair value of $485.53 per share and vest based on the price of our common stock reaching certain targets for a consecutive number of days during the three-year period starting on the grant date and the quantity of shares that will vest range from 0% to 350% of the targeted number of shares. The remaining one-third of PSUs had a grant date fair value of $427.61 and vest based on reaching certain comparable restaurant sales increases during the three-year period starting on January 1, 2017, and the quantity of shares that will vest range from 0% to 300% of the targeted number of shares. If the defined minimum targets are not met, then no shares will vest.

During the nine months ended September 30, 2017, 20 stock awards that were subject to service and performance or market conditions were forfeited.

The following table sets forth total stock based compensation expense:



	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016
Stock based compensation expense	$	18,069	$	18,636	$	55,545	$	49,357
Stock based compensation expense, net of tax	$	10,983	$	10,971	$	33,760	$	29,056
Stock based compensation expense recognized as capitalized development	$	319	$	285	$	949	$	968
Excess tax benefit (deficiency) on stock based compensation recognized in provision for income taxes	$	(77)	$	-	$	587	$	-