Net Income Per Share
|12 Months Ended
Dec. 28, 2014
|Earnings Per Share [Abstract]
|Net Income Per Share
NET INCOME PER SHARE
The number of shares and net income per share data for all periods presented are based on the historical weighted-average shares of common stock outstanding. Net income per share for the year ended December 30, 2012 is computed using the two-class method. The two-class method determines net income per share for common stock and participating securities according to dividends and dividend equivalents and their respective participation rights in undistributed earnings. The Company’s convertible preferred stockholders were entitled to receive dividends in the event dividends on the Company’s common stock were declared. As a result, the shares of the Company’s convertible preferred stock were deemed to be participating securities.
In connection with the IPO, all preferred stock mandatorily converted to common stock on a 1:1 basis.
Basic net income per share of common stock was computed by dividing net income by the weighted-average number of shares of common stock outstanding for the period. For the year ended 2012, basic net income per share of common stock was computed by dividing net income, less an annualized 20.0% preferred return on Series X preferred stock and the undistributed earnings allocated to participating interests, by the weighted-average number of shares of common stock outstanding for the period. The original investment in series X preferred stock and the 20.0% preferred return was required to be paid to series X preferred stockholders prior to any payment of dividends to the common stockholders.
Diluted net income per share of common stock is computed on the basis of the weighted-average number of shares of common stock plus the effect of dilutive potential shares of common stock equivalents outstanding during the period using the treasury stock method for dilutive options and deferred shares (such deferred shares granted under the Chuy's Holdings, Inc. 2012 Omnibus Equity Incentive Plan, the "restricted stock units") and the if converted method for dilutive convertible preferred stock. For the year ended 2012, the numerator is net income less the preferred return and undistributed earnings on the series X preferred stock as this series of preferred stock was anti-dilutive using the if converted method. For the year ended 2012, undistributed earnings allocated to participating interests related to the series A preferred stock and series B preferred stock were not deducted from net income for purposes of calculating diluted earnings per share because the diluted earnings per share gave effect to the conversion of this preferred stock into common stock as of the beginning of the year.
For the year ended December 28, 2014, there were approximately 13,000 shares of common stock equivalents that have been excluded from the calculation of diluted net income per share because their inclusion would have been anti-dilutive.
The computation of basic and diluted net income per share is as follows: