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Share-based Compensation

12 Months Ended

Dec. 31, 2024

Share-based Compensation

Share-based Compensation

(14) Share-based Compensation

On May 13, 2021, our shareholders approved the Texas Roadhouse, Inc. 2021 Long-Term Incentive Plan (the "Plan"). The Plan provides for the granting of various forms of equity awards including options, stock appreciation rights, full value awards, and performance-based awards.

The Company provides restricted stock units ("RSUs") to employees as a form of share-based compensation. A RSU is the conditional right to receive one share of common stock upon satisfaction of the vesting requirement. In addition to RSUs, the Company provides performance stock units ("PSUs") to certain members of management as a form of share-based compensation. A PSU is the conditional right to receive one share of common stock upon meeting a performance obligation along with the satisfaction of the vesting requirement.

The following table summarizes share-based compensation expense recorded in the accompanying consolidated statements of income:

​

​	​	​	​	​	​	​	​	​	​
​	​	Fiscal Year Ended
​	​	December 31,			December 26,			December 27,
​		2024		​	2023		​	2022
Labor expense	​	$	16,277	​	$	11,470	​	$	10,656
General and administrative expense	​		30,778	​		22,760	​		26,007
Total share-based compensation expense	​	$	47,055	​	$	34,230	​	$	36,663

​

We recognize expense for RSUs and PSUs over the vesting term based on the grant date fair value of the award. We record forfeitures as they occur. Activity for our share-based compensation by type of grant for the fiscal year ended December 31, 2024 is presented below.

Summary Details for RSUs

​

​	​	​	​	​	​	​	​	​	​	​
​		​		Weighted-Average			Weighted-Average		​	​
​	​	​	​	Grant Date Fair		​	Remaining Contractual	​	Aggregate
​	​	Shares	​	Value		​	Term (years)	​	Intrinsic Value
Outstanding at December 26, 2023		442,327	​	$	98.41	​	​	​	​	​
Granted		306,099	​	​	158.64	​	​	​	​	​
Forfeited		(22,733)	​	​	123.05	​	​	​	​	​
Vested		(314,803)	​	​	99.10	​	​	​	​	​
Outstanding at December 31, 2024		410,890	​	$	141.43		0.9	​	$	74,052

​

As of December 31, 2024, with respect to unvested RSUs, there was $25.1 million of unrecognized compensation cost that is expected to be recognized over a weighted-average period of 0.9 years. The vesting terms of all RSUs range from 1.0 to 5.0 years. The total intrinsic value of RSUs vested during the years ended December 31, 2024, December 26, 2023, and December 27, 2022 was $49.9 million, $37.8 million, and $37.1 million, respectively. The excess tax benefit associated with vested RSUs for the years ended December 31, 2024, December 26, 2023, and December 27, 2022 was $4.4 million, $1.7 million, and $0.4 million, respectively, which was recognized in the income tax provision.

Summary Details for PSUs

​

​	​	​	​	​	​	​	​	​	​	​
​		​		Weighted-Average			Weighted-Average		​	​
​	​	​	​	Grant Date Fair		​	Remaining Contractual	​	Aggregate
​	​	Shares	​	Value		​	Term (years)	​	Intrinsic Value
Outstanding at December 26, 2023		35,700	​	$	94.61	​	​	​	​	​
Granted		28,600	​	​	118.30	​	​	​	​	​
Performance shares adjustment (1)	​	9,274	​	​	94.17	​	​	​	​	​
Forfeited		—	​	​	—	​	​	​	​	​
Vested		(43,274)	​	​	94.17	​	​	​	​	​
Outstanding at December 31, 2024		30,300	​	$	117.46		0.1	​	$	5,460

(1) Additional shares from the January 2023 PSU grant that vested in January 2024 due to exceeding the initial 100% target.

We grant PSUs to certain members of management subject the achievement of certain earnings targets, which determine the number of units to vest at the end of the vesting period. Share-based compensation expense is recognized for the number of units expected to vest at the end of the period and is expensed beginning on the grant date and through the performance period. For each grant, PSUs vest after meeting the performance and service conditions. The total intrinsic value of PSUs vested during the years ended December 31, 2024, December 26, 2023, and December 27, 2022 was $6.4 million, $3.3 million, and $5.4 million, respectively.

On January 8, 2025, approximately 41,000 shares vested related to the January 2024 PSU grant and are expected to be distributed in February 2025. As of December 31, 2024, with respect to unvested PSUs, there was $0.1 million of unrecognized compensation cost that is expected to be recognized over a weighted-average period of 0.1 years. The allowable excess tax benefit associated with vested PSUs for the years ended December 31, 2024, December 26, 2023, and December 27, 2022 was not significant.

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- Definition

The entire disclosure for share-based payment arrangement.

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