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SEC Filings

S-1/A
CHIPOTLE MEXICAN GRILL INC filed this Form S-1/A on 12/23/2005
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DESCRIPTION OF CAPITAL STOCK

        The following discussion is a summary of the terms of our capital stock, our certificate of incorporation and bylaws and certain applicable provisions of Delaware law. Copies of our certificate of incorporation and bylaws as they will be in effect following this offering are filed as exhibits to the registration statement of which this prospectus is a part.

Reclassification

        Prior to this offering, we had one class of common stock and three classes of preferred stock outstanding, our Series B Preferred Stock, our Series C Preferred Stock and our Series D Preferred Stock. In accordance with the terms of our amended certificate of incorporation, which will become effective immediately prior to the consummation of this offering, each share of our outstanding preferred stock and all shares of our outstanding common stock will be reclassified automatically and without any action on the part of the holders of those shares into one-third of one share of our class B common stock, which will result in a decrease in the number of shares outstanding. In addition, immediately prior to the consummation of this offering, we'll increase our total authorized number of shares of capital stock, and amend our certificate of incorporation and bylaws such that they reflect the descriptions below. Except where otherwise noted, the description of the terms of our charter documents below reflects the terms of those documents as they will be following the Reclassification. The historical data presented in the accompanying financial statements have not been adjusted to give retroactive effect to the Reclassification. We have, however, reflected the Reclassification in the unaudited pro forma balance sheet and pro forma earnings per common share included in the financial statements.

        In this offering, both we and the selling shareholder are selling shares of class A common stock, which will have fewer votes per share than our class B common stock. Under the terms of our amended certificate of incorporation, one of the features of the class B common stock is that shares of class B common stock can only be transferred to McDonald's or its subsidiaries, and that any other transfer of such shares will result in the automatic conversion of those shares to shares of class A common stock without action by the transferor or transferee. In addition, under the amended certificate of incorporation, any holder of shares of class B common stock, including the selling shareholder, will have the right to convert those shares at any time to shares of class A common stock. See "—Common Stock—Conversion" below. Accordingly, although all of the shares that the selling shareholder will receive in connection with the Reclassification will be shares of class B common stock, any shares that investors will receive from the selling shareholder in the offering will be shares of class A common stock.

        Following the offering, our authorized capital stock will consist of 200,000,000 shares of class A common stock, 30,000,000 shares of class B common stock and 600,000,000 shares of preferred stock, of which 7,878,788 shares of class A common stock and 24,615,831 shares of class B common stock are expected to be outstanding (excluding shares to be issued upon exercise of outstanding options and assuming that the underwriters do not exercise their option to purchase additional shares), and no shares of preferred stock are expected to be outstanding. If the underwriters exercise their option in full, we expect 9,060,606 shares of class A common stock and 23,434,013 shares of class B common stock to be outstanding.

Common Stock

        The certificate of incorporation authorizes the issuance of an aggregate of 230,000,000 shares of common stock consisting of 200,000,000 shares of class A common stock and 30,000,000 shares of class B common stock. Upon consummation of this offering, of those authorized shares of class A common stock and class B common stock, 32,494,619 will be validly issued, fully paid and nonassessable. At December 20, 2005, without taking into account the Reclassification, there were 43 holders of record of common stock and non-vested stock, who collectively held about 58,832,266 shares of common stock and non-vested stock. Each of these shares will be converted into one-third of one share of class B common stock as described above under "—Reclassification."

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