What changed in this filing

/stocks — the workspaceLOADING

Item 9A. Controls and Procedures

2025-02-28 compared with 2024-02-23 · 186 added, 247 removed, 826 unchanged (34% of the section changed)

1 unchanged sentence

Evaluation of disclosure controls and procedures

We have evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to, and as defined in, Rules 13a-15(e) and 15d- 15(e) under the Securities Exchange Act of 1934, as amended, as of the end of the period covered by this report.

We have evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to, and as defined in, Rules 13a-15(e) and 15d- 15(e) under the Exchange Act, as of the end of the period covered by this report.

Based on the evaluation, performed under the supervision and with the participation of our management, including the Chief Executive Officer (the "CEO") and the Chief Financial Officer (the "CFO"), our management, including the CEO and CFO, concluded that our disclosure controls and procedures were effective as of December 31, 2024.

14 unchanged sentences

Rule 10b5-1 Trading Plans

In accordance with the disclosure requirement set forth in Item 408 of Regulation S-K, the following table discloses any executive officer or director who is subject to the filing requirements of Section 16 of the Securities Exchange Act of 1934 that adopted a Rule 10b5-1 trading arrangement during the 13 weeks ended December 26, 2023.

In accordance with the disclosure requirement set forth in Item 408 of Regulation S-K, the following table discloses any executive officer or director who is subject to the filing requirements of Section 16 of the Exchange Act that adopted a Rule 10b5-1 trading arrangement during the fourth quarter ended December 31, 2024.

These trading arrangements are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c).

1 unchanged sentence

Aggregate Number of Securities to be Sold

Chief Technology Officer

Chief Executive Officer

(1) A trading plan may expire on such earlier date that all transactions under the trading plan are completed.

24 unchanged sentences

Incorporated by reference from our Definitive Proxy Statement to be dated on or about April 4, 2025.

EXHIBIT AND FINANCIA L STATEMENT SCHEDULES

EXHIBITS AND FINANCIA L STATEMENT SCHEDULES

Consolidated Financial Statements

1 unchanged sentence

Consolidated Balance Sheets as of December 31, 2024 and December 26, 2023

Consolidated Statements of Income and Comprehensive Income for the years ended December 26, 2023, December 27, 2022 and December 28, 2021

Consolidated Statements of Income for the years ended December 31, 2024, December 26, 2023 and December 27, 2022

Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2024, December 26, 2023, and December 27, 2022

3 unchanged sentences

Omitted due to inapplicability or because required information is shown in our Consolidated Financial Statements or Notes thereto.

Amended and Restated Certificate of Incorporation of Registrant (incorporated by reference to Exhibit 3.1 of the Registrant’s Quarterly Report on Form 10-Q for the period ended June 28, 2016)

Restated Certificate of Incorporation for Texas Roadhouse, Inc.

dated as of May 16, 2024 (incorporated by reference to Exhibit 3.2 of the Registrant’s Current Report on Form 8-K May 16, 2024)

Amended and Restated Bylaws for Texas Roadhouse, Inc.

dated February 23, 2023 (incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on Form 8-K dated February 23, 2023)

Description of Securities (incorporated by reference to Exhibit 4.2 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2019)

dated as of May 16, 2024 (incorporated by reference to Exhibit 3.3 to the Registrant’s Current Report on Form 8-K dated May 16, 2024)

Description of Securities

Form of Indemnification Agreement for Director and Executive Officer (incorporated by reference to Exhibit 10.1 of Registrant’s Annual Report on Form 10-K for the year ended December 28, 2021)

18 unchanged sentences

as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on 8-K dated May 11, 2020)

Employment Agreement between Registrant and Gerald L.

Morgan entered into as of December 17, 2020 (incorporated by reference to Exhibit 10.33 to the Registrant’s Annual Report on Form 10-K for the year ended December 29, 2020)

Employment Agreement between Registrant and S.

Chris Jacobsen entered into as of December 30, 2020 (incorporated by reference to Exhibit 10.36 to the Registrant’s Annual Report on Form 10-K for the year ended December 29, 2020)

Employment Agreement between Registrant and Tonya Robinson entered into as of December 30, 2020 (incorporated by reference to Exhibit 10.37 to the Registrant’s Annual Report on Form 10-K for the year ended December 29, 2020)

Employment Agreement between Registrant and Christopher C.

Colson entered into as of March 31, 2021 (incorporated by reference to Exhibit 10.6 of the Registrant’s Quarterly Report on Form 10-Q for the period ended March 30, 2021)

First Amendment to Employment Agreement between Texas Roadhouse Management Corp.

and Gerald L.

Morgan dated March 31, 2021, with a retroactive effective date of March 18, 2021 (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K dated March 31, 2021)

Employment Agreement between Registrant and Regina A.

Tobin entered into as of June 15, 2021 with an effective date of June 30, 2021 (incorporated by reference to Exhibit 10.3 of the Registrant’s Quarterly Report on Form 10-Q for the period ended June 29, 2021)

Employment Agreement between Registrant and Hernan E.

Mujica entered into as of June 15, 2021 with an effective date of June 30, 2021 (incorporated by reference to Exhibit 10.4 of the Registrant’s Quarterly Report on Form 10-Q for the period ended June 29, 2021)

Second Amendment to Amended and Restated Credit Agreement dated as of May 4, 2021 by and among Texas Roadhouse, Inc.

10 unchanged sentences

2021 Long-Term Incentive Plan Restricted Stock Unit Award Agreement (Member of Board of Directors) (incorporated by reference to Exhibit 10.1 of Registrant's Current Report on Form 8-K dated June 15, 2021)

Second Amendment to Employment Agreement between Texas Roadhouse Management Corp.

Employment Agreement between Texas Roadhouse Management Corp.

and Christopher C.

Colson dated December 27, 2024

Employment Agreement between Texas Roadhouse Management Corp.

and Travis C.

Doster dated December 27, 2024

Employment Agreement between Texas Roadhouse Management Corp.

and David Christopher Monroe dated December 27, 2024

Employment Agreement between Texas Roadhouse Management Corp.

and Gerald L.

Morgan dated January 9, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K dated January 6, 2023)

First Amendment to Employment Agreement between Texas Roadhouse Management Corp.

and Regina A.

Tobin dated January 9, 2023 (incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K dated January 6, 2023)

First Amendment to Employment Agreement between Texas Roadhouse Management Corp.

Morgan dated December 27, 2024

Employment Agreement between Texas Roadhouse Management Corp.

and Hernan E.

Mujica dated January 9, 2023 (incorporated by reference to Exhibit 10.3 to the Registrant's Current Report on Form 8-K dated January 6, 2023)

First Amendment to Employment Agreement between Texas Roadhouse Management Corp.

and Christopher C.

Colson dated January 9, 2023 (incorporated by reference to Exhibit 10.4 to the Registrant's Current Report on Form 8-K dated January 6, 2023)

Separation Agreement and Release of Claims dated January 5, 2023 by and between Tonya R.

Robinson and Texas Roadhouse Management Corp.

(incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K dated January 4, 2023)

Mujica dated December 27, 2024

Employment Agreement between Texas Roadhouse Management Corp.

and David Christopher Monroe dated May 17, 2023 (incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K dated May 17, 2023)

and Regina A.

Tobin dated December 27, 2024

Amendment No.

3 to Amended and Restated Credit Agreement dated May 19, 2023 by and among Texas Roadhouse, Inc., the lenders named therein and JPMorgan Chase Bank, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8 ‑ K dated May 19, 2023)

Separation Agreement and Release of Claims dated August 3, 2023 by and between S.

Chris Jacobsen and Texas Roadhouse Management Corp.

(incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K dated August 3, 2023)

Form of Texas Roadhouse, Inc.

2021 Long-Term Incentive Plan Restricted Stock Unit Award Agreement (Non-Officers) (incorporated by reference to Exhibit 10.2 to Registrant’s of the Registrant’s Quarterly Report on Form 10-Q for the period ended September 26, 2023)

Employment Agreement between Texas Roadhouse Management Corp.

and Travis C.

Doster dated November 9, 2023

Texas Roadhouse, Inc.

Stock Trading Policy

List of Subsidiaries

9 unchanged sentences

Annual Report on Form 10-K for the year ended December 31, 2024, filed February 28, 2025, formatted in inline eXtensible Business Reporting Language (iXBRL):

(i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income and Comprehensive Income, (iii) Consolidated Statements of Stockholders’ Equity, (iv) Consolidated Statements of Cash Flows, and (v) the Notes to the Consolidated Financial Statements.

(i) Consolidated Balance Sheets, (ii) Consolidated Statements of Income, (iii) Consolidated Statements of Stockholders’ Equity, (iv) Consolidated Statements of Cash Flows, and (v) the Notes to the Consolidated Financial Statements.

Cover page, formatted in iXBRL and contained in Exhibit 101.

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February 28, 2025

/s/ Jane Grote Abell

February 28, 2025

Jane Grote Abell

/s/ Michael A.

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We have audited the accompanying consolidated balance sheets of Texas Roadhouse, Inc.

and subsidiaries (the Company) as of December 26, 2023 and December 27, 2022, the related consolidated statements of income and comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 26, 2023, and the related notes (collectively, the consolidated financial statements).

and subsidiaries (the Company) as of December 31, 2024 and December 26, 2023, the related consolidated statements of income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and December 26, 2023, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2024, in conformity with U.S.

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Specifically, we evaluated the Company’s assessment of the factors considered, including the cash flows at the individual restaurant level and the cash flow thresholds used in the Company’s analysis.

We tested that those restaurants with trailing 12-month cash flows were evaluated for potential impairment triggers, and we compared trailing 12-month cash flows to historical financial data.

We tested that those restaurants with trailing 12-month cash flows were evaluated for potential impairment triggers, and we compared trailing 12-month cash flows used in the Company’s analysis to historical financial data.

We also assessed other events and circumstances that could have been indicative of a potential impairment trigger by reviewing management’s development reports and related meeting minutes and the board of directors meeting minutes.

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In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 26, 2023 and December 27, 2022, the related consolidated statements of income and comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 26, 2023, and the related notes (collectively, the consolidated financial statements), and our report dated February 23, 2024 expressed an unqualified opinion on those consolidated financial statements.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024 and December 26, 2023, the related consolidated statements of income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements), and our report dated February 28, 2025 expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become

inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Louisville, Kentucky

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Operating lease liabilities, net of current portion

Long-term debt

Restricted stock and other deposits

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Common stock ( $ 0.001 par value, 100,000,000 shares authorized, 66,574,626 and 66,789,464 shares issued and outstanding at December 31, 2024 and December 26, 2023, respectively)

Additional paid-in-capital

Retained earnings

6 unchanged sentences

and Subsidiaries

Consolidated Statements of Income and Comprehensive Incom e

Consolidated Statements of Income

(in thousands, except per share data)

13 unchanged sentences

Interest income (expense), net

Equity income (loss) from investments in unconsolidated affiliates

Equity income from investments in unconsolidated affiliates

Income before taxes

4 unchanged sentences

and subsidiaries

Other comprehensive income, net of tax:

Foreign currency translation adjustment, net of tax of $ — , $ — and

($ 36 ), respectively

Total comprehensive income

Net income per common share attributable to Texas Roadhouse, Inc.

9 unchanged sentences

Noncontrolling

Comprehensive Loss

and Subsidiaries

Balance, December 28, 2021

Other comprehensive income, net of tax

Distributions to noncontrolling interest holders

Acquisition of noncontrolling interest

Dividends declared ($ 1.84 per share)

2 unchanged sentences

Repurchase of shares of common stock

( 2,734,005 )

Share-based compensation

1 unchanged sentence

Distributions to noncontrolling interest holders

Acquisition of noncontrolling interest

Dividends declared ($ 2.20 per share)

1 unchanged sentence

Indirect repurchase of shares for minimum tax withholdings

Repurchase of shares of common stock

( 2,734,005 )

Repurchase of shares of common stock, including excise taxes

Share-based compensation

1 unchanged sentence

Distributions to noncontrolling interest holders

Acquisition of noncontrolling interest, net of deferred taxes

Dividends declared ($ 2.44 per share)

1 unchanged sentence

Indirect repurchase of shares for minimum tax withholdings

Repurchase of shares of common stock, including excise tax

Repurchase of shares of common stock, including excise taxes

Share-based compensation

13 unchanged sentences

Impairment and closure costs

Equity (income) loss from investments in unconsolidated affiliates

Equity income from investments in unconsolidated affiliates

Distributions of income received from investments in unconsolidated affiliates

14 unchanged sentences

Capital expenditures—property and equipment

Acquisition of franchise restaurants, net of cash acquired

Acquisitions of franchise restaurants, net of cash acquired

Proceeds from sale of investments in unconsolidated affiliates

4 unchanged sentences

Payments on revolving credit facility

Debt issuance costs

Distributions to noncontrolling interest holders

Acquisition of noncontrolling interest

Acquisitions of noncontrolling interests

Proceeds from restricted stock and other deposits, net

Indirect repurchase of shares for minimum tax withholdings

Repurchase of shares of common stock

Repurchase of shares of common stock, including excise taxes as applicable

Dividends paid to shareholders

Net cash used in financing activities

Net decrease in cash and cash equivalents

Net increase (decrease) in cash and cash equivalents

Cash and cash equivalents—beginning of period

11 unchanged sentences

Texas Roadhouse, Inc.

and subsidiaries (collectively, the "Company," "we," "our" and/or "us"), is a growing restaurant company operating predominantly in the casual dining segment.

and subsidiaries in which we have a controlling interest (collectively, the "Company," "we," "our," and/or "us"), is a growing restaurant company operating predominantly in the casual dining segment.

Our late founder, W.

1 unchanged sentence

The Company maintains three restaurant concepts operating as Texas Roadhouse, Bubba’s 33, and Jaggers.

As of December 26, 2023, we owned and operated 635 restaurants and franchised an additional 106 restaurants in 49 states and ten foreign countries.

Of the 106 franchise restaurants, there were 58 domestic and 48 international restaurants.

As of December 31, 2024, we owned and operated 666 restaurants and franchised an additional 118 restaurants in 49 states, one U.S.

territory, and ten foreign countries.

Of the 118 franchise restaurants, there were 60 domestic and 58 international restaurants, including one in a U.S.

As of December 26, 2023, we owned and operated 635 restaurants and franchised an additional 106 restaurants in 49 states and ten foreign countries.

2 unchanged sentences

Principles of Consolidation

The accompanying consolidated financial statements present the financial position, results of operations and cash flows of the Company and its majority-owned subsidiaries.

The accompanying consolidated financial statements present the financial position, results of operations, and cash flows of the Company.

All significant intercompany balances and transactions have been eliminated in consolidation.

As of December 26, 2023 and December 27, 2022, we owned a majority interest in 20 company restaurants.

The operating results of these majority-owned restaurants are consolidated and the portion of income attributable to noncontrolling interests is reflected in the line item net income attributable to noncontrolling interests in our consolidated statements of income and comprehensive income.

As of December 26, 2023 and December 27, 2022, we owned a 5.0 % to 10.0 % equity interest in 20 and 23 domestic franchise restaurants, respectively.

As of December 31, 2024 and December 26, 2023, we owned a majority interest in 19 and 20 company restaurants, respectively.

The operating results of these majority-owned restaurants are consolidated and the portion of income attributable to noncontrolling interests is recorded in the line item net income attributable to noncontrolling interests in our consolidated statements of income.

As of December 31, 2024 and December 26, 2023, we owned a 5.0 % to 10.0 % equity interest in 20 domestic franchise restaurants.

These unconsolidated restaurants are accounted for using the equity method.

Our investments in these unconsolidated affiliates are included in other assets in our consolidated balance sheets, and we record our percentage share of net income earned by these unconsolidated affiliates in our consolidated statements of income and comprehensive income under equity income (loss) from investments in unconsolidated affiliates.

Our investments in these unconsolidated affiliates are included in other assets in our consolidated balance sheets, and our percentage share of net income earned by these unconsolidated affiliates is recorded in the line item equity income from investments in unconsolidated affiliates in our consolidated statements of income.

We utilize a 52 or 53 week accounting period that typically ends on the last Tuesday in December.

We utilize a 13 week accounting period for quarterly reporting purposes, except in years containing 53 weeks when the fourth quarter contains 14 weeks.

Fiscal years 2023, 2022 and 2021 were 52 weeks in length.

Fiscal year 2024 was 53 weeks in length and fiscal years 2023 and 2022 were 52 weeks in length.

In fiscal year 2024, the additional week increased restaurant and other sales by $ 114.7 million and increased net income by approximately 5 % in our consolidated statements of income.

Use of Estimates

1 unchanged sentence

generally accepted accounting principles ("GAAP").

Significant items subject to such estimates and assumptions include the valuation of property and equipment, goodwill, lease liabilities and right-of-use assets, obligations related to insurance reserves, legal reserves, income taxes and gift card breakage.

Actual results could differ from those estimates.

Segment Reporting

Operating segments are defined as components of a company that engage in business activities from which it may earn revenue and incur expenses, and for which separate financial information is available and is regularly reviewed by the chief operating decision maker ( " CODM " ) to assess the performance of the individual segments and make decisions about resources to be allocated to the segments.

The Company’s operating segments have been identified in accordance

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

with the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") ASC 280, Segment Reporting .

Segment Reporting

Operating segments are defined as components of a company that engage in business activities from which it may earn revenue and incur expenses, and for which separate financial information is available and is regularly reviewed by the chief operating decision maker ("CODM") to assess the performance of the individual segments and make decisions about resources to be allocated to the segments.

The Company’s operating segments have been identified in accordance with the provisions of Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") ASC 280, Segment Reporting , as amended by ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosure .

We have identified Texas Roadhouse, Bubba’s 33, Jaggers, and our retail initiatives as separate operating segments.

5 unchanged sentences

These amounted to $ 49.4 million and $ 27.8 million at December 31, 2024 and December 26, 2023, respectively.

Receivables consist principally of amounts due from retail gift card providers, certain franchise restaurants for reimbursement of labor costs, pre-opening and other expenses, and franchise restaurants for royalty fees.

Receivables consist principally of amounts due from retail gift card providers, certain franchise restaurants for reimbursement of labor costs, pre-opening, and other expenses, and franchise restaurants for royalties and advertising fees.

Receivables are recorded at the invoiced amount and do not bear interest.

10 unchanged sentences

In most cases, assets on leased properties are depreciated over a period of time which includes both the initial term of the lease and one or more option periods.

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

The estimated useful lives are:

5 unchanged sentences

The cost of purchasing transferable liquor licenses through open markets in jurisdictions with a limited number of authorized liquor licenses are capitalized as indefinite-lived assets and included in Property and equipment, net.

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

Cloud Computing Arrangements

2 unchanged sentences

These costs are included in prepaid expenses and other current assets and other assets in our consolidated balance sheets.

Related amortization expense was $ 1.4 million, $ 1.0 million and $ 0.2 million f or the years ended December 26, 2023, December 27, 2022, and December 28, 2021, respectively, and is included in general and administrative expenses in our consolidated statements of income and comprehensive income.

Related amortization expense was $ 3.9 million, $ 1.4 million, and $ 1.0 million f or the years ended December 31, 2024, December 26, 2023, and December 27, 2022, respectively, and is included in general and administrative expenses in our consolidated statements of income.

We recognize operating lease right-of-use assets and operating lease liabilities for real estate leases, including our restaurant leases and Support Center lease, as well as certain restaurant equipment leases based on the present value of the lease payments over the lease term.

We estimate the present value based on our incremental borrowing rate which corresponds to the underlying lease term.

At lease inception, we include option periods that we are reasonably certain to exercise in the lease term.

To determine if an option is reasonably certain to be exercised, we analyze the economic penalties that would be imposed from a failure to renew a lease, including the loss of our investment in leasehold improvements or the loss of future cash flows.

We estimate the present value of lease payments based on our incremental borrowing rate which considers our estimated credit rating for a secured or collateralized instrument and corresponds to the underlying lease term.

In addition, operating lease right-of-use assets are reduced for accrued rent and increased for any initial direct costs recognized at lease inception.

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Rent holidays are included in the lease term when determining straight-line rent expense.

In recognizing straight-line rent expense, we record the difference between amounts charged to operations and amounts paid as accrued rent.

Certain of our operating leases contain clauses that provide for additional contingent rent based on a percentage of sales greater than certain specified target amounts.

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Refer to Note 8 for further discussion of leases.

Goodwill represents the excess of cost over fair value of assets of businesses acquired.

In accordance with ASC 350, Intangibles—Goodwill and Other ("ASC 350"), goodwill is not subject to amortization and is evaluated for impairment on an annual basis, or sooner if an event or other circumstance indicates that goodwill may be impaired.

The annual assessment date is the first day of our fourth quarter.

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

Goodwill represents the excess of cost over fair value of assets of businesses acquired.

The annual assessment date is the first day of our fourth quarter.

ASC 350 requires that goodwill be tested for impairment at the reporting unit level, or the level of internal reporting that reflects the way in which an entity manages its businesses.

A reporting unit is defined as an operating segment, or one level below an operating segment.

Our goodwill reporting units are at the concept level.

Our goodwill reporting units are at the concept or operating segment level.

As stated in ASC 350, an entity may first assess qualitative factors in order to determine if it is necessary to perform the quantitative test.

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Refer to Note 7 for additional information related to goodwill and intangible assets.

Other assets consist primarily of deferred compensation plan assets, investments in unconsolidated affiliates and deposits.

Other assets consist primarily of deferred compensation plan assets, capitalized cloud computing implementation costs, investments in unconsolidated affiliates, and deposits.

For further discussion of the deferred compensation plan, refer to Note 15 and Note 16.

Impairment or Disposal of Long-lived Assets

In accordance with ASC 360, Property, Plant and Equipment , long-lived assets related to each restaurant to be held and used in the business, such as property and equipment, operating lease right-of-use assets and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of a restaurant may not be recoverable.

In accordance with ASC 360, Property, Plant, and Equipment , long-lived assets to be held and used in the business, such as property and equipment, operating lease right-of-use assets, and intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

For the purposes of this evaluation, we define the asset group at the individual restaurant level.

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Insurance Reserves

We self- insure a significant portion of expected losses under our health, workers’ compensation, general liability, employment practices liability, and property insurance programs.

We purchase insurance for individual claims that exceed the retention amounts listed below:

December 26, 2023

December 27, 2022

Employment practices liability ("EPL")

EPL Class Action

Workers' compensation

General liability (1)

Employee healthcare

(1) In addition to the retention amount of $ 2,500,000 , we have an additional retention corridor that includes claim costs between $ 5,000,000 and $ 10,000,000 related to dram shop statutes.

We self-insure a significant portion of expected losses related to employee health, workers’ compensation, general liability, employment practices liability, cybersecurity, and property claims.

This includes our wholly-owned captive insurance company which covers certain lines of coverage.

We use third-party insurance with varying retention levels to limit our exposure to significant losses.

We record a liability for unresolved claims and for an estimate of incurred but not reported claims based on historical experience.

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Restaurant sales include gross food and beverage sales, net of promotions and discounts, for all company restaurants.

Sales taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from restaurant sales in the consolidated statements of income and comprehensive income.

We record deferred revenue for gift cards that have been sold but not yet redeemed.

1 unchanged sentence

For some of the gift cards that are sold we have determined that, based on our historic gift card redemption patterns, the likelihood of redemption is remote.

For these gift cards, we record a breakage adjustment and reduce deferred revenue by the amount never expected to be redeemed.

For these gift cards, we record a breakage adjustment as a component of restaurant and other sales in the consolidated statements of income and reduce deferred revenue by the amount never expected to be redeemed.

We use historic gift card redemption patterns to determine the breakage rate to utilize and recognize the expected breakage amount in a manner generally consistent with the actual redemption pattern of the associated gift card.

We review the breakage rate on an annual basis, or sooner if circumstances indicate that the rate may have significantly changed and update the rate accordingly as needed.

We review the breakage rate on an annual basis, or sooner if circumstances indicate that the rate may have significantly changed and update the rate as needed.

In addition, we incur fees on all gift cards that are sold through third-party retailers.

These fees are also deferred and generally recorded consistent with the actual redemption pattern of the associated gift cards.

These fees are also deferred and generally recorded consistent with the actual redemption pattern of the associated gift cards and are recorded as a component of restaurant and other sales in the consolidated statements of income.

We also recognize revenue from our franchising of Texas Roadhouse and Jaggers restaurants.

3 unchanged sentences

We recognize fees from supervision and administrative services as incurred.

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

We account for income taxes in accordance with ASC 740, Income Taxes , under which deferred assets and liabilities are recognized based upon anticipated future tax consequences attributable to differences between financial statement carrying values of assets and liabilities and their respective tax bases.

3 unchanged sentences

For all years presented, no valuation allowances have been recorded.

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

We have a domestic system- wide marketing and advertising fund.

1 unchanged sentence

Domestic company and franchise restaurants are required to remit a designated portion of sales to the advertising fund.

Advertising contributions related to company restaurants are recorded as a component of other operating costs.

Advertising contributions received from our franchisees are recorded as a component of franchise royalties and fees in our consolidated statements of income and comprehensive income.

Other costs related to local restaurant area marketing initiatives are included in other operating costs in our consolidated statements of income and comprehensive income.

These costs and the company restaurant contribution amounted to $ 28.3 million, $ 25.0 million and $ 21.1 million for the years ended December 26, 2023, December 27, 2022, and December 28, 2021, respectively.

Advertising contributions related to company restaurants are expensed as incurred and recorded as a component of other operating costs in our consolidated statements of income.

Advertising contributions received from our franchisees are recorded as a component of franchise royalties and fees in our consolidated statements of income.

The associated advertising expenses are recorded as incurred within general and administrative expenses in our consolidated statements of income.

Other costs related to local restaurant area marketing initiatives are included in other operating costs in our consolidated statements of income.

These costs and the company restaurant advertising contribution amounted to $ 31.8 million, $ 28.3 million, and $ 25.0 million for the years ended December 31, 2024, December 26, 2023, and December 27, 2022, respectively.

Pre-opening Expenses

Pre-opening expenses, which are charged to operations as incurred, consist of expenses incurred before the opening of a new or relocated restaurant and consist principally of opening team and training team compensation and benefits, travel expenses, rent, food, beverage, and other initial supplies and expenses.

Comprehensive Income

ASC 220, Income Statement—Reporting Comprehensive Income , establishes standards for reporting and the presentation of comprehensive income and its components in a full set of financial statements.

Comprehensive income consists of net income and foreign currency translation adjustments which are excluded from net income under GAAP.

Foreign currency translation adjustment represents the unrealized impact of translating the financial statements of our foreign investment.

Fair Value of Financial Instruments

1 unchanged sentence

ASC 820, Fair Value Measurement , establishes a framework for measuring fair value and expands disclosures about fair value measurements.

This includes a three-level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

inputs in measuring fair value.

This includes a three- level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs in measuring fair value.

The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date.

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Recently Adopted Accounting Pronouncements

In March 2020, the FASB issued Accounting Standards Update ("ASU") 2020-04, Reference Rate Reform (Topic 848):

Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides temporary optional expedients and exceptions to the current guidance on contract modifications and hedge accounting.

These changes are intended to simplify the market transition from the London Interbank Offered Rate ("LIBOR") and other interbank offered rates to alternative reference rates.

In December 2022, the FASB issued ASU 2022-06, Reference Rate Reform (Topic 848):

Deferral of the Sunset Date of Topic 848 , which defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024.

We adopted this guidance during the 2023 fiscal year and the adoption did not have an impact on our consolidated financial statements.

Recently Issued Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

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The amendments in this update are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

We are currently assessing the impact of this new standard on our segment reporting disclosures.

We adopted this guidance during the fourth quarter of the 2024 fiscal year and provided additional detail and disclosures in our segment reporting disclosures.

Refer to Note 19 for further discussion of segment reporting.

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

2 unchanged sentences

The amendments in this update are effective for fiscal years beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025.

We are currently assessing the impact of this new standard on our income tax disclosures.

We are currently assessing the impact of this new standard on our income tax disclosures and expect to provide additional detail and disclosures under this new guidance.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income (Subtopic 220-40):

Disaggregation of Income Statement Expenses.

This ASU primarily provides enhanced disclosures about the components of expenses within the income statement including purchases of inventory, employee compensation, depreciation, and intangible asset amortization.

The amendments in this update are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

We are currently assessing the impact of this new standard on our disclosures and expect to provide additional detail and disclosures under this new guidance.

The following table disaggregates our revenue by major source:

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Total revenue

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

The following table presents a rollforward of deferred revenue-gift cards:

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On December 28, 2022, the first day of the 2023 fiscal year, we completed the acquisition of eight franchise Texas Roadhouse restaurants located in Maryland and Delaware, including four in which we previously held a 5.0 % equity interest.

Pursuant to the terms of the acquisition agreements, we paid a total purchase price of $ 39.1 million, net of cash acquired, for 100 % of the entities.

The transactions in which we held an equity interest were accounted for as step acquisitions and we recorded a gain of $ 0.6 million on our previous investments in equity income from investments in unconsolidated affiliates in the consolidated statements of income and comprehensive income.

These transactions were accounted for using the acquisition method as defined in ASC 805, Business Combinations .

These acquisitions are consistent with our long-term strategy to increase net income and earnings per share.

The following table summarizes the consideration paid for these acquisitions and the estimated preliminary fair value of the assets acquired and the liabilities assumed at the acquisition date, which are adjusted for measurement-period adjustments through December 26, 2023.

Property and equipment

Operating lease right-of-use assets

Intangible assets

Deferred revenue-gift cards

Current portion of operating lease liabilities

Operating lease liabilities, net of current portion

The aggregate purchase price is preliminary as we are finalizing working capital adjustments.

Intangible assets represent reacquired franchise rights which are being amortized over a weighted-average useful life of 2.2 years.

We expect all of the goodwill will be deductible for tax purposes and believe the resulting amount of goodwill reflects the benefit of sales and unit growth opportunities as well as the benefit of the assembled workforce of the acquired restaurants.

Pro forma financial detail and operating results for the year ended December 26, 2023 have not been presented as the results of the acquired restaurants are not material to our consolidated financial position, results of operations or cash flows.

Pursuant to the terms of the acquisition agreements, we paid a total purchase price of $ 39.1 million, net of cash acquired.

The transactions in which we held an equity interest were accounted for as step acquisitions, and we recorded a gain of $ 0.6 million on our previous investments in equity income from investments in unconsolidated affiliates in the consolidated statements of income.

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

On March 30, 2022, we completed the acquisition of one franchise Texas Roadhouse restaurant located in Nebraska in which we previously held a 5.49 % equity interest.

Pursuant to the terms of the acquisition agreement, we paid a total purchase price of $ 6.6 million, net of cash acquired, for 100 % of the entity.

The transaction was accounted for as a step acquisition and we recorded a gain of $ 0.3 million on our previous investment in equity income from investments in unconsolidated affiliates in the consolidated statements of income and comprehensive income.

On December 29, 2021, the first day of the 2022 fiscal year, we completed the acquisition of seven franchise Texas Roadhouse restaurants located in South Carolina and Georgia.

Pursuant to the terms of the acquisition agreements, we paid a total purchase price of $ 26.5 million, net of cash acquired.

These transactions were accounted for using the acquisition method as defined in ASC 805, Business Combinations .

These acquisitions are consistent with our long-term strategy to increase net income and earnings per share.

The transactions were accounted for using the acquisition method as defined in ASC 805, Business Combinations .

The following table summarizes the consideration paid for these acquisitions and the estimated fair value of the assets acquired and the liabilities assumed at the acquisition date, which are adjusted for final measurement-period adjustments.

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Pro forma financial detail and operating results for the year ended December 27, 2022 have not been presented as the results of the acquired restaurants are not material to our consolidated financial position, results of operations or cash flows.

(5) Long-term Debt

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and PNC Bank, N.A.

The credit facility is an unsecured, revolving credit agreement and has a borrowing capacity of up to $ 300.0 million with the option to increase by an additional $ 200.0 million subject to certain limitations, including approval by the syndicate of lenders.

The credit facility has a maturity date of May 1, 2026.

On May 19, 2023, we amended the credit facility to provide for the transition from LIBOR to the Secured Overnight Financing Rate ("SOFR") as the benchmark rate for purposes of calculating interest on outstanding borrowings.

Pursuant to the amendment, we are required to pay interest on outstanding borrowings at the Term SOFR, plus a fixed adjustment of 0.10 % and a variable adjustment of 0.875 % to 1.875 % depending on our leverage ratio.

At the time of transition to the Term SOFR, we had no outstanding borrowings under the credit facility.

We are required to pay interest on outstanding borrowings at the Term Secured Overnight Financing Rate ("SOFR"), plus a fixed adjustment of 0.10 % and a variable adjustment of 0.875 % to 1.875 % depending on our consolidated leverage ratio.

As of December 31, 2024, we had no outstanding borrowings under the credit facility and had $ 296.8 million of availability, net of $ 3.2 million of outstanding letters of credit.

As of December 26, 2023, we had no outstanding borrowings under the credit facility and had $ 295.3 million of availability, net of $ 4.7 million of outstanding letters of credit.

The interest rate for the credit facility as of December 31, 2024 and December 26, 2023 was 5.47 % and 6.23 %, respectively.

The lenders’ obligation to extend credit pursuant to the credit facility depends on us maintaining certain financial covenants, including a minimum consolidated fixed charge coverage ratio and a maximum consolidated leverage ratio.

The credit facility permits us to incur additional secured or unsecured indebtedness, except for the incurrence of secured indebtedness that in the aggregate is equal to or greater than $ 125.0 million and 20 % of our consolidated tangible net worth.

We were in compliance with all financial covenants as of December 31, 2024.

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

As of December 26, 2023, we had no outstanding balance on the credit facility and had $ 295.3 million of availability, net of $ 4.7 million of outstanding letters of credit.

As of December 27, 2022, we had $ 50.0 million outstanding on the credit facility, which was repaid in 2023, and $ 233.5 million of availability, net of $ 16.5 million of outstanding letters of credit.

The outstanding amount as of December 27, 2022 is included as long-term debt on our consolidated balance sheet.

The interest rate for the credit facility as of December 26, 2023 and December 27, 2022 was 6.23 % and 5.21 % , respectively.

We were in compliance with all financial covenants as of December 26, 2023 and December 27, 2022.

(6) Property and Equipment, Net

Property and equipment were as follows:

December 31,2024

December 26,2023

Land and improvements

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( 1,223,064 )

For the years ended December 26, 2023, December 27, 2022 and December 28, 2021, the amount of interest capitalized in connection with restaurant construction was $ 0.5 million, $ 1.3 million and $ 0.2 million, respectively.

( 1,078,855 )

Total property and equipment, net

For the year ended December 31, 2024, there was no interest capitalized in connection with restaurant construction.

For the years ended December 26, 2023 and December 27, 2022, the amount of interest capitalized in connection with restaurant construction was $ 0.5 million and $ 1.3 million, respectively.

(7) Goodwill and Intangible Assets

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Balance as of December 31, 2024

As of December 31, 2024, the gross carrying amount and accumulated amortization of the intangible assets were $ 24.4 million and $ 23.1 million, respectively.

As of December 26, 2023, the gross carrying amount and accumulated amortization of the intangible assets were $ 24.4 million and $ 20.9 million, respectively.

Intangible assets consist of reacquired franchise rights.

The gross carrying amount and accumulated amortization of the intangible assets at December 26, 2023 were $ 24.4 million and $ 20.9 million, respectively.

As of December 27, 2022, the gross carrying amount and accumulated amortization of the intangible assets were $ 23.5 million and $ 17.9

We amortize reacquired franchise rights on a straight-line basis over the remaining term of the franchise operating agreements, which varies by franchise agreement.

Amortization expense for the next three years is expected to range from zero to $ 1.2 million.

Refer to Note 4 for discussion of the acquisitions completed for the year ended December 26, 2023.

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

million, respectively.

We amortize reacquired franchise rights on a straight-line basis over the remaining term of the franchise operating agreements, which varies by franchise agreement.

Amortization expense for the next four years is expected to range from zero to $ 2.2 million.

Refer to Note 4 for discussion of the acquisitions completed for the years ended December 26, 2023 and December 27, 2022.

We recognize right-of-use assets and lease liabilities for both real estate and equipment leases that have a term in excess of one year .

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The right-of-use asset balance is included as a component of other assets and the lease liability balance as a component of other liabilities in the consolidated balance sheets.

In 2023, we entered into six sale leaseback transactions that generated proceeds of $ 16.3 million and no gain or loss was recognized on the transactions.

In 2022, we entered into four sale leaseback that generated proceeds of $ 12.9 million and no gain or loss was recognized on the transactions.

In 2024, we entered into five sale leaseback transactions that generated proceeds of $ 16.0 million and no gain or loss was recognized on these transactions.

In 2023, we entered into six sale leaseback that generated proceeds of $ 16.3 million and no gain or loss was recognized on these transactions.

The resulting operating leases are included in the operating lease right-of-use assets and lease liabilities noted above.

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Net deferred tax liability

As of December 27, 2022, we had a tax credit carryforward of $ 2.7 million primarily related to FICA tip and Work opportunity tax credits that exceeded credit limitations.

This federal carryforward was fully utilized during 2023.

We have not provided a valuation allowance for any of our deferred tax assets as their realization is more likely than not.

A reconciliation of the beginning and ending liability for unrecognized tax benefits was as follows:

23 unchanged sentences

Each series of preferred stock will have the number of shares, designations, preferences, voting powers, qualifications, and special or relative rights or privileges as shall be determined by the Board, which may include, but are not limited to, dividend rights, voting rights, redemption and sinking fund provisions, liquidation preferences, conversion rights, and preemptive rights.

There were no shares of preferred stock outstanding at December 26, 2023 and December 27, 2022.

There were no shares of preferred stock outstanding as of December 31, 2024 and December 26, 2023.

(11) Stock Repurchase Program

On March 17, 2022, our Board approved a stock repurchase program under which we may repurchase up to $ 300.0 million of our common stock.

On March 17, 2022, our Board approved a stock repurchase program for the repurchase of up to $ 300.0 million of our common stock.

This stock repurchase program has no expiration date.

All repurchases to date under our stock repurchase programs have been made through open market transactions.

The timing and the amount of any repurchases are determined by management under parameters established by the Board, based on an evaluation of our stock price, market conditions and other corporate considerations.

For the year ended December 26, 2023, we paid $ 50.0 million to repurchase 455,026 shares of our common stock.

For the year ended December 27, 2022, we paid $ 212.9 million to repurchase 2,734,005 shares of our common stock.

This included $ 133.1 million repurchased under our current authorized stock repurchase program and $ 79.7 million repurchased under our prior authorization.

The timing and the amount of any repurchases are determined by management under parameters approved by the Board, based on an evaluation of our stock price, market conditions, and other corporate considerations, including complying with Rule 10b5-1 trading arrangements under the Securities Exchange Act of 1934, as amended.

For the year ended December 31, 2024, we paid $ 79.8 million, excluding excise taxes, to repurchase 461,662 shares of our common stock.

For the year ended December 26, 2023, we paid $ 50.0 million, excluding excise taxes, to repurchase 455,026 shares of our common stock.

As of December 31, 2024, we had $ 37.1 million remaining under our authorized stock repurchase program.

Refer to Note 20 for further discussion of our authorized stock repurchase program.

(12) Earnings Per Share

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For all periods presented, the weighted-average shares of nonvested stock units that were outstanding but not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect were not significant.

The following table sets forth the calculation of earnings per share and weighted average shares outstanding as presented in the accompanying consolidated statements of income and comprehensive income:

The following table sets forth the calculation of earnings per share and weighted average shares outstanding as presented in the accompanying consolidated statements of income:

Fiscal Year Ended

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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 the share-based compensation recorded in the accompanying consolidated statements of income and comprehensive income:

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

Fiscal Year Ended

4 unchanged sentences

We record forfeitures as they occur.

Activity for our share- based compensation by type of grant for the year ended December 26, 2023 is presented below.

Activity for our share- based compensation by type of grant for the fiscal year ended December 31, 2024 is presented below.

Texas Roadhouse, Inc.

24 unchanged sentences

(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 to a one-year vesting and the achievement of certain earnings targets, which determine the number of units to vest at the end of the vesting period.

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.

1 unchanged sentence

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, 2024, approximately 43,000 shares vested related to the January 2023 PSU grant and are expected to be distributed during the 13 weeks ending March 26, 2024.

As of December 26, 2023, with respect to unvested PSUs, the amount of unrecognized compensation cost that is expected to be recognized over a weighted-average period of 0.1 year was not significant.

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.

1 unchanged sentence

We have a defined contribution benefit plan ("401(k) Plan") that is available to our Support Center employees and managers in our restaurants who meet certain compensation and eligibility requirements.

The 401(k) Plan allows participating employees to defer the receipt of a portion of their compensation and contribute such amount to one or more investment options.

Beginning in 2022, we implemented a company match of a certain percentage of the employee contributions to the 401(k) Plan.

For the year ended December 26, 2023, company contributions totaling $ 7.1

The 401(k) Plan allows participating employees to defer the receipt of a portion of their compensation and contribute such amount to one or more investment options and the Company matches a certain percentage of the employee contributions.

For the year ended December 31, 2024, company contributions totaling $ 8.4 million and $ 2.1 million were recorded in labor expense

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

million and $ 1.8 million were recorded in labor expense and general and administrative expense, respectively, within the consolidated statements of income and comprehensive income.

For the year ended December 27, 2022, company contributions totaling $ 5.4 million and $ 1.6 million were recorded in labor expense and general and administrative expense, respectively, within the consolidated statements of income and comprehensive income.

and general and administrative expense, respectively, within the consolidated statements of income.

For the year ended December 26, 2023, company contributions totaling $ 7.1 million and $ 1.8 million were recorded in labor expense and general and administrative expense, respectively, within the consolidated statements of income.

We also have a deferred compensation plan which allows highly compensated employees to defer a portion of their compensation and contribute such amounts to one or more investment funds held in a rabbi trust.

Beginning in 2023, we implemented a company match of a certain percentage of the employee contributions to the deferred compensation plan.

For the year ended December 26, 2023, company contributions totaling $ 1.6 million and $ 1.5 million were recorded in labor expense and general and administrative expense, respectively, within the consolidated statements of income and comprehensive income.

For the years ended December 31, 2024 and December 26, 2023, company contributions totaling $ 1.6 million and $ 1.5 million were recorded in labor expense and general and administrative expense, respectively, within the consolidated statements of income.

Refer to Note 16 for further discussion on the fair value measurement of the deferred compensation plan assets and liabilities.

1 unchanged sentence

At December 31, 2024 and December 26, 2023, the fair values of cash and cash equivalents, accounts receivable, and accounts payable approximated their carrying values based on the short-term nature of these instruments.

At December 27, 2022, the fair value of our credit facility approximated its carrying value since it is a variable rate credit facility (Level 2).

There were no transfers among levels within the fair value hierarchy during the year ended December 31, 2024.

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Deferred compensation plan—liabilities

We report the accounts of the deferred compensation plan in other assets and the corresponding liability in other liabilities in our consolidated financial statements.

We report the accounts of the deferred compensation plan in other assets and the corresponding liability in other liabilities in our consolidated balance sheets.

These investments are considered trading securities and are reported at fair value based on quoted market prices.

The realized and unrealized holding gains and losses related to these investments, as well as the offsetting compensation expense, are recorded in general and administrative expense in the consolidated statements of income and comprehensive income.

The following table presents the fair value of our assets measured on a nonrecurring basis:

Fair Value Measurements

Total gain (loss)

Fiscal Year Ended

Long-lived assets held for sale

Long-lived assets held for use

Operating lease right-of-use assets

Long-lived assets held for sale included land and building at a site that relocated.

These assets were sold during the fiscal year ended December 27, 2022 and resulted in a gain of $ 0.7 million which is included in impairment and closure, net in our consolidated statements of income and comprehensive income.

Long-lived assets held for use include the land and building for one underperforming restaurant that was impaired down to fair value in 2022.

These assets were valued using a Level 3 input.

This impairment, which totaled $ 1.0 million, is included in impairment and closure costs , net in our consolidated statements of income and comprehensive income.

For further discussion of impairment charges, refer to Note 17.

Operating lease right-of-use assets as of December 27, 2022 includes the lease related assets for two restaurants that

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

were relocated in 2022.

These assets were reduced to a fair value of zero in 2022.

This resulted in a loss of $ 0.7 million for the fiscal year ended December 27, 2022, which is included in impairment and closure, net in our consolidated statements of income and comprehensive income.

(17) Impairment and Closure Costs

We recorded impairment and closure costs of $ 1.2 million, $ 0.3 million and $ 1.6 million for the years ended December 31, 2024, December 26, 2023, and December 27, 2022, respectively.

Impairment and closure costs in 2023 included $ 0.3 million related to ongoing closure costs for stores which have relocated.

Impairment and closure costs in 2024 included $ 0.8 million related to the impairment of a building at a previously relocated store and $ 0.4 million related to ongoing closure costs for stores which have been relocated.

Impairment and closure costs in 2023 included $ 0.3 million related to ongoing closure costs for stores which have been relocated.

Impairment and closure costs in 2022 included $ 1.7 million related to the impairment of the land, building, and operating lease right-of-use assets at three restaurants, two of which were relocated and $ 0.6 million related to ongoing closure costs.

This was partially offset by a $ 0.7 million gain on the sale of land and building that was previously classified as assets held for sale.

Impairment and closure costs in 2021 included $ 0.7 million related to the impairment of the fixed assets and operating lease right-of-use assets at two restaurants, both of which have relocated.

(18) Related Party Transactions

As of December 31, 2024, December 26, 2023 and December 27, 2022, we had four franchise restaurants and one majority-owned company restaurant owned in part by a current officer of the Company.

We recognized revenue of $ 2.0 million, $ 1.8 million and $ 1.7 million for the years ended December 26, 2023, December 27, 2022, and December 28, 2021, respectively, related to these restaurants.

We recognized revenue of $ 2.1 million, $ 2.0 million, and $ 1.8 million for the years ended December 31, 2024, December 26, 2023, and December 27, 2022, respectively, related to the four franchise restaurants.

Texas Roadhouse, Inc.

and Subsidiaries

Notes to Consolidated Financial Statements

(Tabular amounts in thousands, except share and per share data)

(19) Segment Information

We manage our restaurant and franchising operations by concept and as a result have identified Texas Roadhouse, Bubba's 33, Jaggers and our retail initiatives as separate operating segments.

Our CODM is the Chief Executive Officer.

The CODM assesses the performance of the business and allocates resources at the concept level and as a result we have identified Texas Roadhouse, Bubba's 33, Jaggers, and our retail initiatives as separate operating segments.

Our reportable segments are Texas Roadhouse and Bubba's 33.

The Texas Roadhouse reportable segment includes the results of our domestic company Texas Roadhouse restaurants and domestic and international franchise Texas Roadhouse restaurants.

The Bubba's 33 reportable segment includes the results of our domestic company Bubba's 33 restaurants.

Our remaining operating segments, which include the results of our domestic company and franchise Jaggers restaurants and the results of our retail initiatives, are included in Other.

In addition, Corporate-related segment assets, depreciation and amortization and capital expenditures are also included in Other.

Management uses restaurant margin as the measure for assessing performance of our segments.

The Texas Roadhouse reportable segment includes the results of our company and franchise Texas Roadhouse restaurants.

The Bubba's 33 reportable segment includes the results of our company Bubba's 33 restaurants.

Our remaining operating segments, which include the results of our company and franchise Jaggers restaurants and the results of our retail initiatives, are included in Other.

In addition, corporate-related assets, depreciation and amortization, and capital expenditures are also included in Other.

The CODM uses restaurant margin as the primary financial measure for assessing the performance of our segments.

Restaurant margin represents restaurant and other sales less restaurant-level operating costs, including food and beverage costs, labor, rent, and other operating costs.

Restaurant margin also includes sales and operating costs related to our non-royalty based retail initiatives.

Restaurant margin is used by our CODM to evaluate core restaurant-level operating efficiency and performance.

Restaurant margin is also used by our CODM to evaluate core restaurant-level operating efficiency and performance, assist in the evaluation of operating trends over time, and in making capital allocation decisions.

Capital allocation decisions include approving new store openings and the refurbishment or relocation of existing restaurants.

In calculating restaurant margin, we exclude certain non-restaurant-level costs that support operations, including pre-opening and general and administrative expenses, but do not have a direct impact on restaurant-level operational efficiency and performance.

We exclude pre-opening expense as it occurs at irregular intervals and would impact comparability to prior period results.

We exclude depreciation and amortization expense, substantially all of which relates to restaurant-level assets, as it represents a non-cash charge for the investment in our restaurants.

We exclude impairment and closure expense as we believe this provides a clearer perspective of the Company’s ongoing operating performance and a more useful comparison to prior period results.

We exclude pre-opening expenses as they occur at irregular intervals and would impact comparability to prior period results.

We exclude depreciation and amortization expenses, substantially all of which relate to restaurant-level assets, as it represents a non-cash charge for the investment in our restaurants.

We exclude impairment and closure expenses as we believe this provides a clearer perspective of the Company’s ongoing operating performance and a more useful comparison to prior period results.

Restaurant margin as presented may not be comparable to other similarly titled measures of other companies in our industry.

Restaurant and other sales for all operating segments are derived primarily from food and beverage sales.

We do not rely on any major customer as a source of sales and the customers and assets of our reportable segments are located predominantly in the United States.

There are no material transactions between reportable segments.

Texas Roadhouse, Inc.

2 unchanged sentences

(Tabular amounts in thousands, except share and per share data)

Restaurant and other sales for all operating segments are derived primarily from food and beverage sales.

We do not rely on any major customer as a source of sales and the customers and assets of our reportable segments are located predominantly in the United States.

There are no material transactions between reportable segments.

The following tables reconcile our segment results to our consolidated results reported in accordance with GAAP:

3 unchanged sentences

Restaurant operating costs (excluding depreciation and amortization):

Food and Beverage

Other Operating

Restaurant margin

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Restaurant operating costs (excluding depreciation and amortization):

Food and Beverage

Other Operating

Restaurant margin

6 unchanged sentences

Restaurant operating costs (excluding depreciation and amortization):

Food and Beverage

Other Operating

Restaurant margin

Depreciation and amortization

Segment assets

Capital expenditures

4 unchanged sentences

A reconciliation of restaurant margin to income from operations is presented below.

We do not allocate interest income (expense), net and equity income (loss) from investments in unconsolidated affiliates to reportable segments.

We do not allocate interest income (expense), net and equity income from investments in unconsolidated affiliates to reportable segments.

Fiscal Year Ended

8 unchanged sentences

Income from operations

(20) Subsequent Events

On January 1, 2025, we completed the acquisition of 13 domestic franchise restaurants.

Pursuant to the terms of the acquisition agreements, we paid an aggregate purchase price of approximately $ 78 million.

We expect to complete the preliminary purchase price allocations relating to these transactions in the first quarter of fiscal year 2025.

On February 19, 2025, our Board approved a stock repurchase program for the repurchase of up to $ 500.0 million of our common stock.

This new stock repurchase program commenced on February 24, 2025 and any repurchases under such plan will be made by the Company through open market transactions.

This stock repurchase program has no expiration date and replaces the previous stock repurchase program of $ 300 million which was approved on March 17, 2022.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures