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SEC Filings

CHIPOTLE MEXICAN GRILL INC filed this Form S-1/A on 12/23/2005
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Services Agreement—Schedule II

Insurance Services


        McDonald's will negotiate and develop property and casualty insurance programs, terms, coverages, and premiums for Chipotle, including the following categories of insurance:

    Fiduciary Liability
    Internet Liability
    All Risk Property, including Earthquake and Flood
    Umbrella Liability & Excess Liability
    General Liability
    Workers Compensation
    Auto Liability and Physical Damage

        In addition, McDonald's will:

    interface with the Network, Gallagher Bassett and other insurance service providers on behalf of Chipotle as reasonably requested by Chipotle;

    enter Chipotle store and office locations into the SOCS system; and

    provide advice on insurance, risk management and claims matters as reasonably requested by Chipotle.

Billing Methodology:

        The amounts to be paid by Chipotle to McDonald's for the Insurance Services are intended to represent the pass-through to Chipotle of costs incurred by McDonald's on Chipotle's behalf.

        With regard to (i) Fiduciary Liability, (ii) Crime, (iii) Internet Liability, (iv) All Risk Property, including Earthquake and Flood, and (v) Umbrella Liability & Excess Coverage insurances, these coverages consist of policies of insurance naming McDonald's and its subsidiaries as insureds (the "McDonald's Policies"). Based on McDonald's' current level of ownership of Chipotle, Chipotle participates as an insured subsidiary under the McDonald's Policies. A portion of the premiums paid by McDonald's for the McDonald's Policies will be allocated to Chipotle (the "Chipotle Allocation"). For the policy period from November 1, 2005 through October 31, 2006, the Chipotle Allocation shall be $645,000.00, which amount shall be paid in full immediately upon execution of this Agreement. For each policy period thereafter, McDonald's shall calculate the Chipotle Allocation in good faith exercising McDonald's' reasonable judgment and, when feasible, considering advice from insurance companies and other relevant, disinterested third parties.

        With regard to (x) General Liability, (y) Workers Compensation, and (z) Auto Liability and Physical Damage insurances, these coverages are included in stand-alone programs arranged specifically for Chipotle and billed directly to Chipotle. As such, McDonald's will collect no fees or costs from Chipotle in connection with these programs.

Term; Termination of Insurance Services:

        The policies of insurance contemplated by the Insurance Services expire on October 31stof each calendar year, and, as such, unless terminated earlier pursuant to Section 6.02 of the Agreement or as set forth below, the Insurance Services shall have an initial term expiring on October 31, 2006, and will be renewed automatically thereafter for successive one (1) year terms unless either Chipotle or


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