UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 29, 2020

OR

☐  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from           to

Commission File Number 000-50972

Texas Roadhouse, Inc.

(Exact name of registrant specified in its charter)

Delaware	20-1083890
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification Number)

6040 Dutchmans Lane, Suite 200

Louisville, Kentucky 40205

(Address of principal executive offices) (Zip Code)

(502) 426-9984

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.001 per share	TXRH	NASDAQ Global Select Market

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes   ☒  No  ☐.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes   ☒  No  ☐.

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer  ☒	Accelerated Filer  ☐	Non-accelerated Filer  ☐	Smaller Reporting Company  ☐
			Emerging Growth Company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  ☐  No  ☒.

The number of shares of common stock outstanding were 69,482,522 on October 28, 2020.

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION
Item 1 — Financial Statements (Unaudited) — Texas Roadhouse, Inc. and Subsidiaries	3
Condensed Consolidated Balance Sheets — September 29, 2020 and December 31, 2019	3
Condensed Consolidated Statements of Income and Comprehensive Income — For the 13 and 39 Weeks Ended September 29, 2020 and September 24, 2019	4
Condensed Consolidated Statement of Stockholders’ Equity — For the 13 and 39 Weeks Ended September 29, 2020 and September 24, 2019	5
Condensed Consolidated Statements of Cash Flows — For the 39 Weeks Ended September 29, 2020 and September 24, 2019	7
Notes to Condensed Consolidated Financial Statements	8
Item 2 — Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3 — Quantitative and Qualitative Disclosures About Market Risk	31
Item 4 — Controls and Procedures	32
PART II. OTHER INFORMATION
Item 1 — Legal Proceedings	33
Item 1A — Risk Factors	33
Item 2 — Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3 — Defaults Upon Senior Securities	34
Item 4 — Mine Safety Disclosures	34
Item 5 — Other Information	35
Item 6 — Exhibits	35
Signatures	36

2

PART I — FINANCIAL INFORMATION

ITEM 1 — FINANCIAL STATEMENTS

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands, except share and per share data)

(unaudited)

	September 29, 2020		December 31, 2019
Assets
Current assets:
Cash and cash equivalents	$	328,636	$	107,879
Receivables, net of allowance for doubtful accounts of $21 at September 29, 2020 and $12 at December 31, 2019		32,015		99,305
Inventories, net		19,889		20,267
Prepaid income taxes		3,968		2,015
Prepaid expenses and other current assets		15,033		18,433
Total current assets		399,541		247,899
Property and equipment, net of accumulated depreciation of $744,378 at September 29, 2020 and $678,988 at December 31, 2019		1,076,924		1,056,563
Operating lease right-of-use assets, net		526,501		499,801
Goodwill		124,748		124,748
Intangible assets, net of accumulated amortization of $14,122 at September 29, 2020 and $14,141 at December 31, 2019		890		1,234
Other assets		59,407		53,320
Total assets	$	2,188,011	$	1,983,565
Liabilities and Stockholders’ Equity
Current liabilities:
Current portion of operating lease liabilities	$	18,635	$	17,263
Current maturities of long-term debt		50,000		—
Accounts payable		65,843		61,653
Deferred revenue-gift cards		146,470		209,258
Accrued wages		34,825		39,699
Income taxes payable		1,116		—
Accrued taxes and licenses		28,289		30,433
Other accrued liabilities		51,224		58,914
Total current liabilities		396,402		417,220
Operating lease liabilities, net of current portion		567,480		538,710
Long-term debt		190,000		—
Restricted stock and other deposits		8,172		8,249
Deferred tax liabilities, net		7,138		22,695
Other liabilities		100,316		65,522
Total liabilities		1,269,508		1,052,396
Texas Roadhouse, Inc. and subsidiaries stockholders’ equity:
Preferred stock ($0.001 par value, 1,000,000 shares authorized; no shares issued or outstanding)		—		—
Common stock ($0.001 par value, 100,000,000 shares authorized, 69,482,522 and 69,400,252 shares issued and outstanding at September 29, 2020 and December 31, 2019, respectively)		69		69
Additional paid-in-capital		140,659		140,501
Retained earnings		762,366		775,649
Accumulated other comprehensive loss		(178)		(225)
Total Texas Roadhouse, Inc. and subsidiaries stockholders’ equity		902,916		915,994
Noncontrolling interests		15,587		15,175
Total equity		918,503		931,169
Total liabilities and equity	$	2,188,011	$	1,983,565

See accompanying notes to condensed consolidated financial statements.

3

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Statements of Income and Comprehensive Income

(in thousands, except per share data)

(unaudited)

	13 Weeks Ended				39 Weeks Ended
	September 29, 2020		September 24, 2019		September 29, 2020		September 24, 2019
Revenue:
Restaurant and other sales	$	626,429	$	645,230	$	1,747,145	$	2,014,720
Franchise royalties and fees		4,756		5,259		12,989		16,205
Total revenue		631,185		650,489		1,760,134		2,030,925
Costs and expenses:
Restaurant operating costs (excluding depreciation and amortization shown separately below):
Food and beverage		201,308		205,158		575,529		650,136
Labor		217,275		218,342		652,976		667,712
Rent		13,723		12,994		40,445		39,173
Other operating		102,978		100,742		296,615		306,355
Pre-opening		4,894		4,736		14,296		12,801
Depreciation and amortization		29,364		28,347		87,434		84,574
Impairment and closure, net		716		61		871		394
General and administrative		25,951		35,225		88,520		111,168
Total costs and expenses		596,209		605,605		1,756,686		1,872,313
Income from operations		34,976		44,884		3,448		158,612
Interest expense (income), net		1,502		(81)		2,601		(1,526)
Equity income (loss) from investments in unconsolidated affiliates		1		(154)		(597)		100
Income before taxes	$	33,475	$	44,811	$	250	$	160,238
Income tax expense (benefit)		3,072		6,785		(13,999)		23,331
Net income including noncontrolling interests		30,403		38,026	$	14,249	$	136,907
Less: Net income attributable to noncontrolling interests		1,173		1,495		2,543		5,141
Net income attributable to Texas Roadhouse, Inc. and subsidiaries	$	29,230	$	36,531	$	11,706	$	131,766
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustment, net of tax of ($25), $40, ($16) and $35, respectively		74		(118)		47		(103)
Total comprehensive income	$	29,304	$	36,413	$	11,753	$	131,663
Net income per common share attributable to Texas Roadhouse, Inc. and subsidiaries:
Basic	$	0.42	$	0.53	$	0.17	$	1.86
Diluted	$	0.42	$	0.52	$	0.17	$	1.85
Weighted average shares outstanding:
Basic		69,446		69,573		69,410		70,896
Diluted		69,898		69,939		69,830		71,287
Cash dividends declared per share	$	—	$	0.30	$	0.36	$	0.90

See accompanying notes to condensed consolidated financial statements.

4

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Statement of Stockholders' Equity

(in thousands, except share and per share data)

(unaudited)

	For the 13 Weeks Ended September 29, 2020
								Accumulated		Total Texas
				Additional				Other		Roadhouse, Inc.
		Par		Paid-in-		Retained		Comprehensive		and		Noncontrolling
	Shares	Value		Capital		Earnings		Loss		Subsidiaries		Interests		Total
Balance, June 30, 2020	69,403,969	$	69	$	135,068	$	733,136	$	(252)	$	868,021	$	14,698	$	882,719
Net income	—		—		—		29,230		—		29,230		1,173		30,403
Other comprehensive income, net of tax	—		—		—		—		74		74		—		74
Distributions to noncontrolling interest holders	—		—		—		—		—		—		(284)		(284)
Shares issued under share-based compensation plans including tax effects	113,453		—		—		—		—		—		—		—
Indirect repurchase of shares for minimum tax withholdings	(34,900)		—		(1,989)		—		—		(1,989)		—		(1,989)
Share-based compensation	—		—		7,580		—		—		7,580		—		7,580
Balance, September 29, 2020	69,482,522	$	69	$	140,659	$	762,366	$	(178)	$	902,916	$	15,587	$	918,503
	For the 13 Weeks Ended September 24, 2019
								Accumulated		Total Texas
				Additional				Other		Roadhouse, Inc.
		Par		Paid-in-		Retained		Comprehensive		and		Noncontrolling
	Shares	Value		Capital		Earnings		Loss		Subsidiaries		Interests		Total
Balance, June 25, 2019	69,801,550	$	70	$	152,872	$	738,123	$	(213)	$	890,852	$	14,766	$	905,618
Net income	—		—		—		36,531		—		36,531		1,495		38,026
Other comprehensive loss, net of tax	—		—		—		—		(118)		(118)		—		(118)
Distributions to noncontrolling interest holders	—		—		—		—		—		—		(1,539)		(1,539)
Dividends declared ($0.30 per share)	—		—		—		(20,863)		—		(20,863)		—		(20,863)
Shares issued under share-based compensation plans including tax effects	94,010		—		—		—		—		—		—		—
Indirect repurchase of shares for minimum tax withholdings	(29,416)		—		(1,657)		—		—		(1,657)		—		(1,657)
Repurchase of shares of common stock	(358,381)		—		(18,913)		—		—		(18,913)				(18,913)
Share-based compensation	—		—		8,143		—		—		8,143		—		8,143
Balance, September 24, 2019	69,507,763	$	70	$	140,445	$	753,791	$	(331)	$	893,975	$	14,722	$	908,697

See accompanying notes to condensed consolidated financial statements.

5

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Statement of Stockholders' Equity

(in thousands, except share and per share data)

(unaudited)

	For the 39 Weeks Ended September 29, 2020
								Accumulated		Total Texas
				Additional				Other		Roadhouse, Inc.
		Par		Paid-in-		Retained		Comprehensive		and		Noncontrolling
	Shares	Value		Capital		Earnings		Loss		Subsidiaries		Interests		Total
Balance, December 31, 2019	69,400,252	$	69	$	140,501	$	775,649	$	(225)	$	915,994	$	15,175	$	931,169
Net income	—		—		—		11,706		—		11,706		2,543		14,249
Other comprehensive income, net of tax	—		—		—		—		47		47		—		47
Distributions to noncontrolling interest holders	—		—		—		—		—		—		(2,131)		(2,131)
Dividends declared ($0.36 per share)	—		—		—		(24,989)		—		(24,989)		—		(24,989)
Shares issued under share-based compensation plans including tax effects	501,930		—		—		—		—		—		—		—
Indirect repurchase of shares for minimum tax withholdings	(167,251)		—		(9,291)		—		—		(9,291)		—		(9,291)
Repurchase of shares of common stock	(252,409)		—		(12,621)		—		—		(12,621)		—		(12,621)
Share-based compensation	—		—		22,070		—		—		22,070		—		22,070
Balance, September 29, 2020	69,482,522	$	69	$	140,659	$	762,366	$	(178)	$	902,916	$	15,587	$	918,503
	For the 39 Weeks Ended September 24, 2019
								Accumulated		Total Texas
				Additional				Other		Roadhouse, Inc.
		Par		Paid-in-		Retained		Comprehensive		and		Noncontrolling
	Shares	Value		Capital		Earnings		Loss		Subsidiaries		Interests		Total
Balance, December 25, 2018	71,617,510	$	72	$	257,388	$	688,337	$	(228)	$	945,569	$	15,139	$	960,708
Net income	—		—		—		131,766		—		131,766		5,141		136,907
Other comprehensive loss, net of tax	—		—		—		—		(103)		(103)		—		(103)
Distributions to noncontrolling interest holders	—		—		—		—		—		—		(4,885)		(4,885)
Acquisition of noncontrolling interest and other	—		—		(70)		—		—		(70)		(673)		(743)
Dividends declared ($0.90 per share)	—		—		—		(63,634)		—		(63,634)		—		(63,634)
Shares issued under share-based compensation plans including tax effects	527,927		—		—		—		—		—		—		—
Indirect repurchase of shares for minimum tax withholdings	(182,616)		—		(10,926)		—		—		(10,926)		—		(10,926)
Repurchase of shares of common stock	(2,455,058)		(2)		(130,963)		—		—		(130,965)		—		(130,965)
Cumulative effect of adoption of ASC 842, Leases, net of tax	—		—		—		(2,678)		—		(2,678)		—		(2,678)
Share-based compensation	—		—		25,016		—		—		25,016		—		25,016
Balance, September 24, 2019	69,507,763	$	70	$	140,445	$	753,791	$	(331)	$	893,975	$	14,722	$	908,697

See accompanying notes to condensed consolidated financial statements.

6

Texas Roadhouse, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

	39 Weeks Ended
	September 29, 2020		September 24, 2019
Cash flows from operating activities:
Net income including noncontrolling interests	$	14,249	$	136,907
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		87,434		84,574
Deferred income taxes		(15,572)		(3,660)
Loss on disposition of assets		2,107		4,138
Impairment and closure costs		799		26
Equity loss (income) from investments in unconsolidated affiliates		597		(100)
Distributions of income received from investments in unconsolidated affiliates		205		495
Provision for doubtful accounts		9		(18)
Share-based compensation expense		22,070		25,016
Changes in operating working capital:
Receivables		67,281		59,002
Inventories		378		1,629
Prepaid expenses and other current assets		5,045		2,408
Other assets		(6,185)		(9,297)
Accounts payable		(771)		(5,854)
Deferred revenue—gift cards		(62,788)		(85,042)
Accrued wages		(4,874)		1,552
Prepaid income taxes and income taxes payable		(837)		14,600
Accrued taxes and licenses		(2,144)		2,440
Other accrued liabilities		504		(1,772)
Operating lease right-of-use assets and lease liabilities		3,519		4,367
Other liabilities		35,009		10,586
Net cash provided by operating activities		146,035		241,997
Cash flows from investing activities:
Capital expenditures—property and equipment		(117,521)		(144,917)
Proceeds from sale of property and equipment		32		351
Proceeds from sale leaseback transaction		2,167		—
Net cash used in investing activities		(115,322)		(144,566)
Cash flows from financing activities:
Proceeds from revolving credit facility		240,000		—
Debt issuance costs		(641)		—
Distributions to noncontrolling interest holders		(2,131)		(4,885)
Acquisition of noncontrolling interest		—		(743)
(Repayments) proceeds from restricted stock and other deposits, net		(283)		176
Indirect repurchase of shares for minimum tax withholdings		(9,291)		(10,926)
Repurchase of shares of common stock		(12,621)		(130,963)
Dividends paid to shareholders		(24,989)		(60,675)
Net cash provided by (used in) financing activities		190,044		(208,016)
Net increase (decrease) in cash and cash equivalents		220,757		(110,585)
Cash and cash equivalents—beginning of period		107,879		210,125
Cash and cash equivalents—end of period	$	328,636	$	99,540
Supplemental disclosures of cash flow information:
Interest paid, net of amounts capitalized	$	1,654	$	238
Income taxes paid	$	2,419	$	12,391
Capital expenditures included in current liabilities	$	12,164	$	16,934

See accompanying notes to condensed consolidated financial statements.

7

Texas Roadhouse, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

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

(unaudited)

(1)  Basis of Presentation

The accompanying unaudited condensed consolidated financial statements include the accounts of Texas Roadhouse, Inc. ("TRI"), our wholly-owned subsidiaries and subsidiaries in which we have a controlling interest (collectively the "Company," "we," "our" and/or "us") as of September 29, 2020 and December 31, 2019 and for the 13 and 39 weeks ended September 29, 2020 and September 24, 2019.

As of September 29, 2020, we owned and operated 526 restaurants and franchised an additional 97 restaurants in 49 states and ten foreign countries. Of the 526 company restaurants that were operating at September 29, 2020, 506 were wholly-owned and 20 were majority-owned. Of the 97 franchise restaurants, 70 were domestic restaurants and 27 were international restaurants. Included within these restaurant totals are three international franchise restaurants that remain temporarily closed due to the global COVID-19 pandemic (the "pandemic"). These stores continue to be included in the above totals as we believe they will re-open once it is considered safe to do so.

As of September 24, 2019, we owned and operated 502 restaurants and franchised an additional 95 restaurants in 49 states and ten foreign countries. Of the 502 company restaurants that were operating at September 24, 2019, 482 were wholly-owned and 20 were majority-owned. Of the 95 franchise restaurants, 70 were domestic restaurants and 25 were international restaurants.

As of September 29, 2020 and September 24, 2019, we owned a 5.0% to 10.0% equity interest in 24 domestic franchise restaurants. Additionally, as of September 29, 2020 and September 24, 2019, we owned a 40% equity interest in four non-Texas Roadhouse restaurants as part of a joint venture agreement with a casual dining restaurant operator in China. The unconsolidated restaurants are accounted for using the equity method. Our investments in these unconsolidated affiliates are included in other assets in our unaudited condensed consolidated balance sheets, and we record our percentage share of net income earned by these unconsolidated affiliates in our unaudited condensed consolidated statements of income and comprehensive income under equity income from investments in unconsolidated affiliates. All significant intercompany balances and transactions for these unconsolidated restaurants as well as the entities whose accounts have been consolidated have been eliminated.

We have made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements and the reporting of revenue and expenses during the periods to prepare these unaudited condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles ("GAAP"). Significant items subject to such estimates and assumptions include the carrying amount of property and equipment, goodwill, obligations related to insurance reserves, leases and leasehold improvements, legal reserves, gift card breakage and third-party fees and income taxes. Actual results could differ from those estimates.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our consolidated financial position, results of operations and cash flows for the periods presented. The unaudited condensed consolidated financial statements have been prepared in accordance with GAAP, except that certain information and footnotes have been condensed or omitted pursuant to rules and regulations of the Securities and Exchange Commission (the "SEC"). Operating results for the 13 and 39 weeks ended September 29, 2020 are not necessarily indicative of the results that may be expected for the year ending December 29, 2020. The unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2019.

8

Risks and Uncertainties

The Company is subject to risks and uncertainties as a result of the pandemic. On March 13, 2020, the pandemic was declared a National Public Health Emergency. Shortly after the national emergency declaration, state and local officials began placing restrictions on restaurants, some of which allowed To-Go or curbside service only while others limited capacity in the dining room. By March 31, 2020, the last day of our Q1 2020 fiscal quarter, all of our domestic company and franchise restaurants were under state or local order which only allowed for To-Go or curbside service. Beginning in early May 2020, state and local guidelines began to allow dining rooms to re-open, typically at a limited capacity. By September 29, 2020, the last day of our Q3 2020 fiscal quarter, nearly all of our 526 company-owned restaurants had re-opened their dining rooms under various limited capacity restrictions.

We continue to monitor state and local plans as they move along their phased approach to allow restaurants to re-open at full capacity. We have developed a hybrid operating model that accommodates our limited capacity dining rooms together with enhanced To-Go, which includes a curbside and/or drive-up operating model, as permitted by local guidelines. This includes design changes to our building to better accommodate the increased To-Go sales and the expansion of outdoor seating areas where allowed. We also have installed booth partitions in all of our restaurants as an added safety measure for our guests. In addition, we have increased our already strict sanitation requirements, are conducting daily health and temperature checks for all employees before they begin their shift and are requiring personal protective equipment to be worn by all restaurant employees at all times. As we work through the various limited capacity phases at each of our locations, the safety of our employees and guests remains our top priority.

As a result of the temporary dining room closures and the subsequent limited capacity restrictions for in-person dining, we have experienced a significant decrease in traffic which has impacted our operating results. While nearly all of our dining rooms have re-opened, a significant portion continue to operate under capacity restrictions that severely limit the number of guests we can serve. In addition, while we have seen significant sales growth in our To-Go program, even with dining rooms re-opened, we currently do not expect these sales will generate a similar profit margin and cash flows to our normal operating model. We expect our operating results to continue to be impacted until at least such time that state and local restrictions are lifted, and our dining rooms can re-open at full capacity. We cannot predict how long the pandemic will last, how long it will take until all state and local restrictions will be lifted, or if dining rooms will be required to close again in whole or in part in areas severely impacted by the pandemic. In addition, we cannot predict the overall impact on the economy or consumer spending habits. The extent of this re-opening process will determine the significance of the impact to our financial condition, financial results, and liquidity in future periods. In addition, significant items subject to estimates and assumptions including the carrying amount of property and equipment, goodwill, and lease related assets could be impacted.

(2) Recent Accounting Pronouncements

Financial Instruments

(Accounting Standards Update 2016-13, "ASU 2016-13")

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which requires measurement and recognition of expected versus incurred losses for financial assets held.  We adopted ASU 2016-13 as of the beginning of our 2020 fiscal year.  The adoption of this standard did not have a significant impact on our condensed consolidated financial statements.

9

Goodwill

(Accounting Standards Update 2017-04, "ASU 2017-04")

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which simplifies the accounting for goodwill impairment and is expected to reduce the cost and complexity of accounting for goodwill.  ASU 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation.  Instead, goodwill impairment will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of the goodwill.  We adopted ASU 2017-04 as of the beginning of our 2020 fiscal year. The adoption of this standard did not have a significant impact on our condensed consolidated financial statements.

Fair Value Measurement

(Accounting Standards Update 2018-13, "ASU 2018-13")

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement, which changes disclosure requirements for fair value measurements. We adopted ASU 2018-13 as of the beginning of our 2020 fiscal year. The adoption of this standard did not have a significant impact on our condensed consolidated financial statements.

Income Taxes

(Accounting Standards Update 2019-12, "ASU 2019-12")

In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which removes certain exceptions related to the approach for intraperiod tax allocations, the calculation of income taxes in interim periods, and the recognition of deferred taxes for investments. This guidance also simplifies aspects of accounting for recognizing deferred taxes for taxable goodwill. ASU 2019-12 is effective for fiscal years beginning after December 15, 2020 (our 2021 fiscal year) and for interim periods within those years, with early adoption permitted. We are currently assessing the impact of this new standard on our consolidated financial statements.

Reference Rate Reform

(Accounting Standards Update 2020-04, "ASU 2020-04")

In March 2020, the FASB issued 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. This guidance is effective upon issuance to modifications made as early as the beginning of the interim period through December 31, 2022. We are currently assessing the impact of this new standard on our consolidated financial statements.

(3)   Long-term Debt

On August 7, 2017, we entered into the Amended and Restated Credit Agreement (the "Amended Credit Agreement") with respect to our revolving credit facility with a syndicate of commercial lenders led by JPMorgan Chase Bank, N.A., PNC Bank, N.A., and Wells Fargo Bank, N.A. The revolving credit facility remains an unsecured, revolving credit agreement under which we may borrow up to $200.0 million with the option to increase the revolving credit facility by an additional $200.0 million subject to certain limitations, including approval by the syndicate of lenders. On May 11, 2020, we amended the revolving credit facility to provide for an incremental revolving credit facility of up to $82.5 million. This amount reduced the additional $200.0 million that was available under the revolving credit facility. The maturity date for the incremental revolving credit facility is May 10, 2021. The maturity date for the original revolving credit facility remains August 5, 2022.

The terms of the amendment require us to pay interest on outstanding borrowings of the original revolving credit facility at LIBOR plus a margin of 1.50% and to pay a commitment fee of