NASDAQ_TXRH_2019

Dear Shareholders,

This is our second year to highlight our sustainability efforts in the Annual Report. As we announced last year, we are

committed to updating our Sustainability Report annually. We also committed to updating the Board of Directors each

year, which we did at the November Board of Directors Meeting. We updated the Board on our 2019 accomplishments

and our plan for 2020. The support of the Board and the Executive Team demonstrates our company’s commitment to our

sustainability mission, which is to make every community we serve better than we found it.

We believe that our four pillars – Food,

Community, Employees, and Conservation –

align with our brand, employees, and guests.

The pillars are also aligned with five of the

United Nations’ 17 Sustainable Development

Goals: good health and well-being, clean

water and sanitation, affordable and clean

energy, responsible consumption and

production, and life on land.

Since the beginning, one of our most

important sustainability assets is our

Managing Partner Model, which provides

our Managing Partners with 10% of their

restaurant profits. This ownership mentality

is a built-in incentive for our Managing

Partners to reduce waste, conserve energy,

and run lean restaurants. After all, the less

they waste means more money in their

pockets. This creates a win for all.

We are excited about the bottom-up

momentum that has been created rather

than top-down mandates. Our company was

built on this bottom-up mentality and we

feel that for sustainability to be successful,

we need to follow that same model. Building

“sustainability champions” will provide

immense benefits down the line.

For example, last year, we created a

Sustainability Committee at our Support

Center. This group, which is comprised of

10 employees from various departments,

was formed in April and has hit the ground

running. In September, the committee and

Support Center volunteers completed a

neighborhood cleanup where they collected

400 gallons of trash. The committee also

hosted a Responsible E-cycling Week and

collected three 112-gallon bins of electronics

and four 96-gallon bins of documents to

shred. They have committed to hosting one

event each year, and knowing this group, it

will probably be more!

The renovation of our Support Center offices

gave us a great opportunity to highlight

sustainability throughout our buildings. A

few examples include the use of recycled

barn wood, wood from bourbon barrels,

water bottle filling stations, and recycling

areas, which has lessened the use of plastic

bottles and cans throughout the buildings.

The building design includes an open-office

concept, creating more natural light, which

will cut down on electricity use. In addition,

all offices now have lights with motion

sensors that turn off automatically, which

has resulted in energy savings.

We also found a great opportunity to

combine sustainability with our support

of veterans through a partnership with

Chris Cruise. Chris is a veteran who created

a company to make wooden flags from

discarded bourbon barrels. The repurposed

flags are made by veterans, some of who

are 100% disabled. As a result of the

partnership, we ordered nearly 400 of the

flags rather than creating awards for our

upcoming conference.

In 2019, we began our partnership with

WaterStep, a non-profit focused on water

solutions for clean water in developing

countries. Through our partnership, we

purchased WaterBalls to help women and

children in developing countries gather

water for their families. Instead of carrying

limited quantities of water on top of their

heads, the WaterBalls are a safer and more

efficient solution. WaterStep has used some

of the money donated to explore building a

factory in Kenya to build the WaterBalls and

distribute locally, which would provide jobs

and cut down on shipping costs.

For 2020, we increased our commitment

to the Honeybee Conservancy. We had

great success last year in placing bee hives

throughout the country. This year we will

also be providing grants to beekeepers.

As we continued to grow our sustainability

programs, we did face several challenges

last year. Our kids crayon recycling program

did not do well in our regional test, so we

have not expanded it nationwide. We are

currently reassessing the program to find

future opportunities that might be more

effective. We also experienced a drop in

the number of stores recycling in 2019.

This is the second year we have experienced

a drop, which is due to rising costs and

other hurdles.

We have a number of new opportunities

that we are exploring in 2020. For example,

we are in the very early stages of testing

a uniform shirt that is made from recycled

materials. We are also excited to begin

sharing sustainability messaging on our

social media channels more consistently

throughout the year. And finally, we are

going to explore composting in our Support

Center café in an effort to reduce waste.

We are excited about the opportunities and

momentum in 2020 as we believe it could

be a pivotal year. To review our full 2019

Sustainability Report, visit our website at

texasroadhouse.com/sustainability.

SUSTAINABILITY

Sustainability

Update

2019

Travis Doster

Vice President of Communications

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