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STOCK-BASED COMPENSATION | 12 Months Ended
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Jun. 24, 2020
Share-based Payment Arrangement [Abstract] |
STOCK-BASED COMPENSATION | Our shareholder approved stock-based compensation plans include the Stock Option and Incentive Plan for employees (“Employee Plan”) and the Stock Option and Incentive Plan for Non-Employee Directors and Consultants (collectively, and as may be amended, the “Plans”). The Plans provide for grants of options to purchase our common stock, restricted stock, restricted stock units, and stock appreciation rights. Additionally, grants to eligible employees may vest over a specified period of time or service period, or may contain performance-based conditions. In fiscal 2019, our shareholders approved and we registered an additional 1.4 million shares of common stock of Brinker International, Inc. available for issuance under the Employee Plan. The total number of shares authorized for issuance to employees and non-employee directors and consultants under the Plans at June 24, 2020 is 38.7 million shares. Presented below is total stock-based compensation expenses, and the related total income tax benefit recognized in the Consolidated Statements of Comprehensive Income:
| Fiscal Years Ended
| June 24, 2020 |  | June 26, 2019 |  | June 27, 2018
Stock-based compensation expenses | $ | 14.7 |  |  | $ | 16.4 |  |  | $ | 14.2 |
Tax benefit related to stock-based compensation expenses | 2.5 |  |  | 3.0 |  |  | 4.3 |
Stock Options In fiscal 2019 and fiscal 2018, certain eligible employees under the Plans were granted performance stock options whose vesting is contingent upon meeting Company performance goals based on our annual earnings at the end of fiscal 2021 and 2022. Expenses for performance stock options are recognized using a graded-vesting schedule over the vesting period based upon management’s periodic estimates of the number of stock options that ultimately will vest. The options vest over a period of 4 to 5 years and have a contractual term to exercise of no later than August 31, 2025. Stock options that do not contain a performance condition were also granted to eligible employees in fiscal 2020, fiscal 2019 and fiscal 2018, consistent with prior year grants. Expenses related to these stock options are recognized using a graded-vesting schedule over the vesting period or to the date on which retirement eligibility is achieved, if shorter. Stock options generally vest over a period of 1 to 4 years and have contractual terms to exercise of 8 years. Full or partial vesting of awards may occur upon a change in control (as defined in the Plans), or upon an employee’s death, disability or involuntary termination. Stock option transactions during fiscal 2020 were as follows (option prices in dollars):
| Number of Options |  | Weighted Average Exercise Price |  | Weighted Average Remaining Contractual Life (Years) |  | Aggregate Intrinsic Value
Stock options outstanding at June 26, 2019 | 2.5 |  |  | $ | 41.33 |  |  |  |  |
Granted | 0.3 |  |  | 35.33 |  |  |  |  |
Exercised | 0.0 |  |  | 29.07 |  |  |  |  |
Forfeited or canceled | (0.1 | ) |  | 44.75 |  |  |  |  |
Stock options outstanding at June 24, 2020 | 2.7 |  |  | $ | 40.68 |  |  | 4.8 |  | $ | 0.3 |
Stock options exercisable at June 24, 2020 | 1.0 |  |  | $ | 45.32 |  |  | 3.4 |  | $ | 0.0 |
During fiscal 2019, we modified certain fiscal 2018 performance-based stock option awards and 0.2 million options were canceled. We subsequently granted fiscal 2019 performance-based stock option awards of 0.4 million options with a grant date fair value equivalent to the fair value of the canceled fiscal 2018 options as of the modification date. Vesting of the fiscal 2019 performance-based options is conditioned on achievement of the same performance targets and vest on the same schedule as the fiscal 2018 performance-based stock options. There is no incremental compen sation cost as a result of this modification. The fair value of stock options is estimated using the Black-Scholes option-pricing model with the following weighted average assumptions, and the weighted average fair value of option grants:
| Fiscal Years Ended
| June 24, 2020 |  | June 26, 2019 |  | June 27, 2018
Weighted average fair values of option grants | $ | 6.92 |  |  | $ | 8.25 |  |  | $ | 4.51 |
Expected volatility | 33.4 | % |  | 27.2 | % |  | 25.2 | %
Risk-free interest rate | 1.3 | % |  | 2.9 | % |  | 1.9 | %
Expected lives | 5 years |  |  | 5 years |  |  | 6 years |
Dividend yield | 3.2 | % |  | 3.5 | % |  | 4.4 | %
Expected volatility and the expected life of stock options are based on historical experience. The risk-free rate is based on the yield of a United States Treasury Note with a term equal to the expected life of the stock options. The dividend yield is based on the most recent quarterly dividend per share declared and the closing stock price on the declaration date. At June 24, 2020, unrecognized compensation expenses related to stock options totaled approximately $1.9 million and will be recognized over a weighted average period of 1.8 years. The intrinsic value and related tax benefit of options exercised is as follows:
| Fiscal Years Ended
| June 24, 2020 |  | June 26, 2019 |  | June 27, 2018
Intrinsic value of options exercised | $ | 0.6 |  |  | $ | 1.8 |  |  | $ | 2.5 |
Tax benefit realized on options exercised | 0.1 |  |  | 0.4 |  |  | 0.6 |
Restricted Share Awards Restricted share awards consist of performance shares, restricted stock and restricted stock units. Eligible employees under the Plans were granted performance shares whose vesting is contingent upon meeting Company performance goals based on our rate of earnings growth at the end of a three-fiscal-year period. Expenses are recognized ratably over the vesting period, or to the date on which retirement eligibility is achieved, if shorter, based upon management’s periodic estimates of the number of shares that ultimately will be issued. Restricted stock units granted to eligible employees under the Plans generally vest in full on the third anniversary of the date of grant. Restricted stock units issued to eligible employees under our career equity plan generally vest upon each employee’s retirement from the Company. Expenses are recognized ratably over the vesting period, or to the date on which retirement eligibility is achieved, if shorter. Full or partial vesting of awards may occur upon a change in control (as defined in the Plans), or upon an employee’s death, disability or involuntary termination. Restricted share awards and restricted stock units granted to non-employee directors under the Plans generally vest in full on the fourth anniversary of the date of grant or upon each director’s retirement from the Board. The non-employee directors’ awards are non-forfeitable and are expensed upon grant. Restricted share awards during fiscal 2020 were as follows (fair value per award in dollars):
| Number of Restricted Share Awards |  | Weighted Average Grant Date Fair Value Per Award
Restricted share awards outstanding at June 26, 2019 | 1.0 |  |  | $ | 39.48 |
Granted | 0.4 |  |  | 37.86 |
Vested | (0.2 | ) |  | 50.61 |
Forfeited | (0.1 | ) |  | 38.77 |
Restricted share awards outstanding at June 24, 2020 | 1.1 |  |  | $ | 37.17 |
At June 24, 2020, unrecognized compensation expenses related to restricted share awards totaled approximately $7.5 million and will be recognized over a weighted average period of 1.8 years. The fair value of shares that vested is as follows:
| Fiscal Years Ended
| June 24, 2020 |  | June 26, 2019 |  | June 27, 2018
Fair value of restricted share awards vested | $ | 6.6 |  |  | $ | 8.6 |  |  | $ | 4.3 |

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