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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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9.     Leases (Continued)

        Future minimum lease payments required under existing operating leases as of December 31, 2004 are as follows:

2005   $ 39,604
2006     40,312
2007     39,354
2008     38,984
2009     39,888
Thereafter     525,996
   
Total minimum lease payments   $ 724,138
   

        Minimum lease payments have not been reduced by minimum sublease rentals of $16,497 due in the future under non-cancelable subleases.

        Rental expense consists of the following:

 
  For the years ended December 31,
 
 
  2002
  2003
  2004
 
Minimum rentals   $ 16,854   $ 23,688   $ 33,201  
Contingent rentals   $ 82   $ 196   $ 284  
Sublease rental income   $ (534 ) $ (1,143 ) $ (1,632 )

        During the nine months ended September 30, 2005, the Company entered into four sales and leaseback transactions. These transactions do not qualify for sales leaseback accounting because of the Company's deemed continuing involvement with the buyer-lessor due to fixed price renewal options, which results in the transaction being recorded under the financing method. Under the financing method, the assets remain on the consolidated balance sheet and the proceeds from the transactions are recorded as a financing liability. A portion of lease payments are applied as payments of deemed principal and imputed interest. The assets under deemed landlord financing, net, totaled $2,077 (unaudited) and the deemed landlord financing liability was $2,396 (unaudited) at September 30, 2005.

10.   Earnings Per Share

        Basic earnings per common share (Basic EPS) is calculated by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the each period. The common shares outstanding for Basic EPS includes 20,469,773 shares of common stock issuable upon the conversion of convertible preferred stock in periods in which there is income available to common shareholders, but these are excluded in periods of a net loss as the preferred shares are not obligated to share in the losses of the Company. Diluted earnings per common share (Diluted EPS) is calculated using net income (loss) divided by diluted weighted-average shares of common stock outstanding during each period. Potentially dilutive securities include potential common shares related to stock options and non-vested stock. Diluted EPS considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential common shares would have an anti-dilutive effect. Options to purchase 356,000 and 724,000 shares of common stock in 2002 and 2003, respectively, at a weighted average exercise price of $4.99 and $5.42, respectively, which were outstanding during the period, were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

F-20


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