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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Chipotle Mexican Grill Inc | NYSE:CMG | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
127.29 | 3.89% | 3,399.00 | 3,384.04 | 3,295.00 | 3,327.00 | 425,242 | 01:00:00 |
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Preliminary Proxy Statement
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Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
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Definitive Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to §240.14a-12
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1.
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Making the brand visible, relevant, and loved;
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Utilizing a disciplined approach to creativity and innovation;
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Leveraging digital capabilities to drive productivity and expand access, convenience and engagement;
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Engaging with customers through our loyalty program; and
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Running successful restaurants with a strong culture that provides great food with integrity while delivering exceptional
in-restaurant and digital experiences.
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2021 Proxy Statement 1
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2021 Proxy Statement 2
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1.
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Election of the eleven director nominees named in this proxy statement, each to serve a one-year term;
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2.
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An advisory vote to approve the compensation of our executive officers as disclosed in this proxy statement (known as “say on pay”);
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3.
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Ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for the year ending
December 31, 2021;
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4.
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One shareholder proposal described in this proxy statement, if properly presented; and
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5.
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Such other business properly brought before the meeting.
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2021 Proxy Statement 3
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Date and Time:
Tuesday, May 18, 2021
8:00 am (PDT)
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Location:
Live webcast online at http://www.
virtualshareholdermeeting.com/
CMG2021
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Record Date for
Shareholders entitled to vote:
March 23, 2021
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Item
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Board’s Voting
Recommendation
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1. Election of the eleven director nominees named in this proxy statement (page 14)
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For
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2. Advisory Say on Pay vote (page 34)
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For
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3. Ratification of Ernst & Young LLP as independent registered public accountants
(page 35)
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For
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4. Shareholder proposal related to action by written consent of shareholders (page 37)
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Against
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Name
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Years of
Service
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Independent
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Board
Recommendation
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Audit &
Risk
Committee
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Compensation
Committee
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Nominating &
Corporate
Governance
Committee
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Albert Baldocchi
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24
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Yes
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FOR
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✓
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Matthew Carey(1)
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0
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Yes
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FOR
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✓
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Gregg Engles
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1
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Yes
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FOR
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✓
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Patricia Fili-Krushel
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2
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Yes
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FOR
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✓
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Neil Flanzraich(2)
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14
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Yes
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FOR
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Chair
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✓
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Mauricio Gutierrez(1)
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0
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Yes
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FOR
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✓
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Robin Hickenlooper
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4
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Yes
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FOR
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✓
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Chair
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Scott Maw(3)
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2
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Yes
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FOR
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Chair
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Ali Namvar
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4
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Yes
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FOR
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✓
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✓
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Brian Niccol
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3
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No
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FOR
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Mary Winston
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1
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Yes
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FOR
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✓
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(1)
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Messrs. Carey and Gutierrez were elected to the Board on March 30, 2021.
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(2)
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Lead Independent Director.
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(3)
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Designated as an “Audit Committee Financial Expert” under the SEC rules.
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2021 Proxy Statement 4
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Summary of Corporate Governance Highlights
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■
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Ten of the eleven members on our current Board of Directors are independent.
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■
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Board has appointed a Lead Independent Director who has substantive responsibilities,
including engaging in planning and approval of meeting schedules and agendas, presiding over executive sessions of independent directors, and consulting with major shareholders.
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■
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All directors stand for re-election on an annual basis.
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Directors are elected by majority vote in uncontested elections and any director who
does not receive a majority of votes cast is required to submit his or her resignation, for consideration by the Board.
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■
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Independent Board members meet in executive session at each quarterly Board meeting.
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Board and Committee performance is reviewed in an annual self-assessment, with
reporting to and evaluation by the full Board.
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We do not have a shareholder rights plan or “poison pill.”
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All executive officers and directors are prohibited from hedging/pledging shares of
our common stock.
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Bylaws contain proxy access provisions, which enables qualifying shareholders to
nominate directors for election to our Board.
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2021 Proxy Statement 5
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■
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We have robust stock ownership requirements for executive officers and directors,
which are among the highest CEO and CFO ownership requirements amongst our peer group of companies, as described in “Compensation Discussion and Analysis.”
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Bylaws permit holders of at least 25% of our outstanding common stock to call special
meetings of shareholders.
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Our Clawback and Recoupment of Compensation Policy allows the Board to seek
reimbursement of incentive compensation paid or awarded to an executive officer if it was based upon the achievement of financial results that subsequently were restated, and to require forfeiture of an executive officer’s compensation if
they engaged in egregious conduct substantially detrimental to the company.
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We engage with major shareholders to seek their input on issues and to address their
questions and concerns.
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See the “Compensation Discussion and Analysis” section of this proxy statement for
significant compensation policies and procedures we employ to motivate our employees to build shareholder value and promote the interests of all our shareholders.
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2021 Proxy Statement 6
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2021 Proxy Statement 7
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This proxy statement contains information related to the virtual annual meeting of
shareholders of Chipotle Mexican Grill, Inc. to be held on Tuesday, May 18, 2021, beginning at 8:00 a.m. (PDT) online at http://www.virtualshareholdermeeting.com/CMG2021. This proxy statement was prepared under the direction of Chipotle’s
Board of Directors to solicit your proxy for use at the annual meeting. It will be made available to shareholders on or about April 5, 2021.
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2021 Proxy Statement 8
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Board Recommendation:
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Proposal 1 –
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Election of the eleven director nominees named in this proxy statement
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FOR
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Proposal 2 –
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An advisory vote to approve the compensation of our executive officers as disclosed
in this proxy statement (“say on pay”).
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FOR
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Proposal 3 –
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Ratification of the appointment of Ernst & Young LLP as our independent
registered public accounting firm for the year ending December 31, 2021
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FOR
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Proposal 4 –
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Shareholder proposal related to action by written consent of shareholders
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AGAINST
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2021 Proxy Statement 9
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■
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re-submitting your vote on the Internet;
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if you are a shareholder of record, by sending a written notice of revocation to our corporate Secretary
at our principal offices, 610 Newport Center Dr., Suite 1400, Newport Beach, CA 92660; or
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if you are a shareholder of record, by attending the virtual annual meeting and voting online using your
16-digit control number.
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2021 Proxy Statement 10
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2021 Proxy Statement 11
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■
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each person (or group of affiliated persons) known to us to beneficially own more than 5 percent of our
common stock;
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each of the executive officers listed in the 2020 Summary Compensation Table appearing later in this
proxy statement;
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each of our directors; and
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all of our current executive officers and directors as a group.
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Name of Beneficial Owner
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Shares Beneficially
Owned
(Outstanding)
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Shares Beneficially
Owned (Right
to Acquire)
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Total Shares
Beneficially
Owned
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Percentage of
Class Beneficially
Owned
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Beneficial holders of 5% or more of outstanding common stock
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The Vanguard Group, Inc.(1)
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2,811,789
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—
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2,811,789
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9.98%
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T. Rowe Price Associates, Inc.(2)
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2,403,185
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—
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2,403,185
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8.53%
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BlackRock, Inc.(3)
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1,955,400
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—
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1,955,400
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6.94%
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Directors and Executive Officers
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Brian Niccol(4)
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9,032
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74,606
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83,638
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*
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Jack Hartung(5)
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50,286
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18,133
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68,419
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*
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Curt Garner(4)
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5,232
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10,025
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15,257
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*
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Scott Boatwright(4)
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3,804
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7,003
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10,807
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*
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Christopher Brandt(4)(6)
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390
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18,004
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18,394
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*
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Albert Baldocchi(6)(7)
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71,471
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149
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71,620
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*
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Matthew Carey
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—
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—
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—
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*
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Gregg Engles(6)
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100
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107
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207
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*
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Patricia Fili-Krushel(6)
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235
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149
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384
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*
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Neil Flanzraich(6)
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230
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149
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379
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*
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Mauricio Guttierez
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—
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—
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—
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*
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Robin Hickenlooper(6)
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681
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149
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830
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*
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Scott Maw(6)
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225
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149
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374
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*
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Ali Namvar(6)
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3,544
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149
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3,693
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*
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Mary Winston(6)
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—
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107
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107
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*
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All directors and executive officers as a group (18 people)
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146,634
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135,829
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282,463
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*
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*
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Less than one percent.
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(1)
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Based solely on a report on Schedule 13G/A filed on February 10, 2021. The address of The Vanguard Group, Inc. is 100 Vanguard Blvd.,
Malvern, Pennsylvania, 19355. The Vanguard Group, Inc. has sole voting power with respect to zero shares of common stock, shared voting power with respect to 47,612 shares of common stock, sole dispositive power with respect to 2,811,789
shares of common stock and shared dispositive power with respect to 123,243 shares of common stock.
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(2)
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Based solely on a report on Schedule 13G filed on February 16, 2021. The address of T. Rowe Price Associates, Inc. is 100 E. Pratt
Street, Baltimore, Maryland 21202. T. Rowe Price Associates, Inc. has sole voting power with respect to 887,307 shares of common stock, shared voting power with respect to zero shares of common stock, sole dispositive power with respect
to 2,403,185 shares of common stock and shared dispositive power with respect to zero shares of common stock.
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(3)
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Based solely on a report on Schedule 13G/A filed on January 29, 2021. The address of BlackRock, Inc. is 55 East 52nd Street, New York,
New York, 10022. BlackRock, Inc. has sole voting power with respect to 1,694,177 shares of common stock and sole dispositive power with respect to 1,955,400 shares of common stock.
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(4)
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Shares beneficially owned include the following shares underlying stock appreciation rights that are vested or that will vest within
60 days of March 23, 2021: 74,606 shares for Mr. Niccol; 10,025 shares for Mr. Garner; 7,003 shares for Mr. Boatwright; and 17,230 shares for Mr. Brandt.
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2021 Proxy Statement 12
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(5)
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Shares beneficially owned by Mr. Hartung include: 19,782 shares in a revocable trust for Mr. Hartung’s benefit and of which his spouse
is the trustee; 35 shares beneficially owned by his children; and 18,133 shares underlying stock appreciation rights that are vested or will vest within 60 days of March 23, 2021. Mr. Hartung disclaims beneficial ownership of the shares
beneficially owned by his children.
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(6)
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Shares beneficially owned include the following shares underlying restricted stock units that will vest within 60 days of March 23,
2021: 774 shares for Mr. Brandt; 149 shares for Messrs. Baldocchi, Flanzraich, Maw and Namvar and Ms. Fili-Krushel; and 107 shares for Mr. Engles and Ms. Winston.
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(7)
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Shares beneficially owned by Mr. Baldocchi include 33,000 shares held in a trust established for benefit of his children, and 38,471
shares he holds jointly with his spouse.
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2021 Proxy Statement 13
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PROPOSAL 1
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2021 Proxy Statement 14
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Albert S. Baldocchi
Age: 67
Director Since:
1997
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Background:
Mr. Baldocchi
has been self-employed since 2000 as a financial consultant and strategic advisor for, and investor in, a variety of privately-held companies. He holds a Bachelor of Science degree in chemical engineering from the University of California at Berkeley and an MBA from Stanford University.
Qualifications:
Mr. Baldocchi’s
extensive involvement with restaurant companies for more than 25 years has given him an in-depth knowledge of restaurant company finance, operations and strategy. He also has considerable experience with high-growth companies in the restaurant industry and in other industries, and his experience
as a senior investment banker at a number of prominent institutions, including Morgan Stanley, Solomon Brothers and Montgomery Securities, helped him develop solid capabilities in accounting and finance as well.
How I Chipotle:
Burrito with
white rice, pinto beans, barbacoa, tomatillo-green chili salsa and sour cream, with a side of guacamole and chips.
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Matthew A. Carey
Age: 56
Director Since:
2021
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Background:
Mr. Carey has
served as Executive Vice President and Chief Information Officer of The Home Depot, Inc., a home improvement retailer, since September 2008. From January 2006 through August 2008, he served as Senior Vice President and Chief Technology Officer at eBay Inc., an online commerce platform. Prior to
that, Mr. Carey held various positions with Wal-Mart Stores, Inc., a general merchandise retailer, from June 1985 to December 2005, with his final position as Senior Vice President and Chief Technology Officer. Mr. Carey previously served as a member of the Board of Directors of Geeknet
Inc. and TransUnion Corp. He received an Associate of Applied Science from Oklahoma State University-Okmulgee.
Qualifications:
Mr. Carey has
significant operational and strategic leadership experience and also brings to our Board extensive experience with information technology, cybersecurity and managing a global retail environment.
How I Chipotle:
Burrito with ½
black beans, ½ pinto beans, double chicken, fajita veggies, tomatillo-green chili salsa, cheese and a side of guacamole
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Gregg L. Engles
Age: 63
Director Since:
2020
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Background:
Mr. Engles is
the founder and managing partner of Capitol Peak Partners LLC, a capital investment company, since April 2017. Mr. Engles previously served as the Chairman of the Board of Directors and Chief Executive Officer of The WhiteWave Foods Company, a global food and beverage company, from October 2012
until April 2017 when it was acquired by Danone S.A. He previously served as the Chief Executive Officer of Dean Foods Company, a food and beverage company and former parent company of WhiteWave, from April 1996 until WhiteWave’s initial public offering in October 2012. Mr. Engles
currently serves on the Board of Directors of Liberty Broadband Corporation and he previously served on the Boards of Directors
of Danone S.A., GCI Liberty (until it merged into Liberty Broadband Corporation), Liberty Expedia Holdings, Inc., and Dartmouth College. He received a bachelor’s degree in Economics from Dartmouth College and Juris Doctorate from Yale University.
Qualifications:
Mr. Engles has
significant operational, strategic leadership and Board experience gained through his senior leadership positions at WhiteWave and other large public companies. He provides our Board with executive leadership perspective on the operations
and management of public companies, which will assist our Board
in evaluating strategic opportunities.
How I Chipotle:
Salad with
Carne Asada, cauliflower rice, black beans, fresh tomato salsa, fajita veggies, sour cream, cheese and Chipotle honey vinaigrette dressing.
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2021 Proxy Statement 15
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Patricia Fili-Krushel
Age: 67
Director Since:
2019
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Background:
Ms. Fili-Krushel
serves as Chair of the Board of Directors of Coqual (formerly Center for Talent Innovation), a New York City–based think tank that focuses on global talent strategies, where she served as Chief Executive Officer from January 2019 until February 2021. From 2011 to 2016, she served as an executive at
Comcast Corporation, a global media and technology company; as Division Chairman, NBCUniversal News Group; and as Executive Vice President, NBCUniversal. Prior to that, Ms. Fili-Krushel served as Executive Vice President and Chief Administrative Officer of Time Warner Inc., a global media and
entertainment company, from 2001 to 2011; as President & CEO, WebMD Health Division, of WebMD Health Corp., from 2000
to 2001; as President, ABC Television Network, and President, ABC Daytime, Disney ABC Television Group, of The Walt Disney Company, a diversified worldwide entertainment company; and as Senior Vice President, Programming of Lifetime Entertainment Services, an entertainment and media company, from 1988
to 1992. She also serves as a director of Dollar General Corporation. Ms. Fili-Krushel received a Bachelor’s degree in communications from Saint John’s University, and an MBA from Fordham University.
Qualifications:
Ms. Fili-Krushel
has extensive leadership, human resources and compensation experience and her contributions to the Board include broad experience in managing global businesses, developing business strategy, talent management and creating organizational cultures. She also brings experience serving on the
boards of directors of other public companies.
How I Chipotle:
Burrito bowl
with cauliflower rice, chicken, black beans, fresh tomato salsa, cheese, guacamole and chips.
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Neil W. Flanzraich
Age: 77
Director Since:
2007
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Background:
Mr. Flanzraich
is the Executive Chairman of Cantex Pharmaceuticals, Inc. (formerly ParinGenix, Inc.), a privately-owned biotech company, where he previously served as Chief Executive Officer and Chairman, and Executive Chairman of Alzheon, Inc., a privately-owned biotech company. He has been a private investor
since February 2006. From 1998 through its sale to TEVA Pharmaceuticals Industries, Ltd. in January 2006, he served as Vice Chairman and President of IVAX Corporation, an international pharmaceutical company. From 1995 to 1998, Mr. Flanzraich served as Chairman of the Life Sciences Legal
Practice Group of Heller Ehrman LLP, a law firm, and from 1981 to 1994, served as Senior Vice President, General Counsel and member of the Operating and Executive Committees of Syntex Corporation, an international pharmaceutical company. Mr. Flanzraich serves as Chairman of Atlantix Care
Corporation, a privately-owned healthcare provider; Chairman and Co-Founder of AgoneX Biopharmaceuticals, Inc., a
privately owned biotech company; and a member of the Board of Directors of Atrium European Real Estate Limited, an owner/manager of shopping centers in Central and Eastern Europe. He previously served as a director and as Lead Independent Director of Equity One Inc., and as a
director of a number of other public and private companies. He received an A.B. from Harvard College and a J.D. from Harvard Law School.
Qualifications:
Mr. Flanzraich’s
executive experience has helped him develop outstanding skills in leading and managing strong teams of employees, and in oversight of the growth and financing of businesses in a rapidly evolving market. His legal background also is valuable to us in the risk management area, and Mr. Flanzraich
brings to us extensive experience serving as an independent director of other public and privately-held companies.
How I Chipotle:
Burrito with
cauliflower rice, chicken, pinto beans, guacamole, fresh tomato salsa and lettuce.
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2021 Proxy Statement 16
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Mauricio Gutierrez
Age: 50
Director Since:
2021
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Background:
Mr. Gutierrez
has served as President and Chief Executive Officer of NRG Energy, Inc., an integrated power company, since December 2015. He joined NRG in August 2004 and has served in multiple executive positions within NRG including Executive Vice President and Chief Operating Officer of NRG from July
2010 to December 2015; Executive Vice President–Commercial Operations from January 2009 to July 2010; and Senior Vice President–Commercial
Operations from March 2008 to January 2009. Mr. Gutierrez also served as the Interim President and Chief Executive Officer of Clearway Energy, Inc. (formerly NRG Yield, Inc.), an energy infrastructure investor and owner that was spun off from NRG Energy in 2015, from December 2015 to May 2016,
and Executive Vice President and Chief Operating Officer of Clearway from December 2012 to December 2015. He has served as a member of the Board of Directors of NRG since January 2016, and he previously served on the board of Clearway Energy, Inc. Mr. Gutierrez holds a bachelor's degree in
industrial engineering from the Universidad Panamericana, a master's degree in mineral economics from Colorado School of Mines and a master's degree in petroleum economics from the French Petroleum Institute.
Qualifications:
Mr. Gutierrez’s
experience as a chief executive officer brings to our Board management’s perspective on leading day-to-day business operations. He also has extensive experience with strategic planning, leading a senior management team, risk management and environmental and sustainability issues.
How I Chipotle:
Burrito with
Carne Asada, white rice, pinto beans, guacamole, with tomatillo-green chili salsa and chips.
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Robin Hickenlooper
Age: 42
Director Since:
2016
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Background:
Ms. Hickenlooper
is Senior Vice President of Corporate Development at Liberty Media Corporation, an owner of media, communications and entertainment businesses, and has served in senior corporate development roles at Liberty Media and its affiliates since 2010. Prior to joining Liberty Media in 2008,
Ms. Hickenlooper worked at Del Monte Foods and in investment banking at Thomas Weisel Partners. Ms. Hickenlooper previously served on the board of directors of FTD Companies, Inc. She earned an MBA from Kellogg School of Management at Northwestern University and a Bachelor’s degree in Public
Policy from Duke University.
Qualifications:
Ms. Hickenlooper
brings to the Board significant experience in marketing and new media, as well as public company corporate governance.
How I Chipotle:
Salad with
brown rice, chicken, fresh tomato salsa, tomatillo-green chili salsa, cheese and guacamole, with a touch of sour cream and chips crumbled on top.
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2021 Proxy Statement 17
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|
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Scott Maw
Age: 53
Director since:
2019
|
| |
Background:
Mr. Maw served
as a Managing Director at WestRiver Group, a private equity investment firm, from August 2019 to August 2020 and as a Senior Advisor from August 2020 until February 2021. He was Executive Vice President and Chief Financial Officer at Starbucks Corporation, a global roaster and retailer of
specialty coffee, from 2014 until his retirement at the end of 2018. He also was Senior Vice President, Corporate Finance at Starbucks from 2012 to 2013, and Senior Vice President and Global Controller from 2011 to 2012. From 2010 to 2011, he was Senior Vice President and CFO of SeaBright
Holdings, Inc., a specialty workers’ compensation insurer. From 2008 to 2010, he was Senior Vice President and CFO of the Consumer Bank at JP Morgan Chase & Company. Prior to this, Mr. Maw held leadership positions in finance at Washington Mutual, Inc. from 2003 to 2008, and GE
Capital from 1994 to 2003. Prior to joining GE Capital, Mr. Maw worked at KPMG’s audit practice from 1990 to 1994. He currently serves as a member of the boards of directors of Avista Corporation, Alcon Inc., and Root, Inc. and serves on the Board of Trustees of Gonzaga University. Mr. Maw
holds a Bachelor of Business Administration in Accounting from Gonzaga University.
Qualifications:
Mr. Maw brings
to our Board expert knowledge in finance, accounting, risk management and public corporate governance and has extensive experience leading global teams.
How I Chipotle:
Burrito bowl
with Carne Asada or chicken, white rice, black beans, cheese, fresh tomato salsa and tomatillo-red chile salsa.
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|
Ali Namvar
Age: 51
Director Since:
2016
|
| |
Background:
Mr. Namvar is a
private investor focused on growth companies and he serves as an advisory board member of Pershing Square Capital Management, L.P., an investment firm that currently is a significant shareholder of Chipotle. From January 2006 through April 2018, Mr. Namvar was an active partner and senior member
of the investment team at Pershing Square. Prior to joining Pershing Square, Mr. Namvar held positions at Blackstone Group and Goldman Sachs Group, Inc. Mr. Namvar holds a Bachelor of Arts degree from Columbia University and an MBA from the Wharton School at the University of Pennsylvania.
Qualifications:
Mr. Namvar has
significant investment experience in restaurant companies, high growth businesses and the branded consumer goods sector. He also brings to the Board a deep knowledge of finance, equity markets, strategic transactions and investor relations.
How I Chipotle:
Burrito bowl
with chicken, black beans, fajita veggies, romaine lettuce, fresh tomato salsa and guacamole.
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2021 Proxy Statement 18
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|
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Brian Niccol
Age: 47
Director Since:
2018
|
| |
Background:
Mr. Niccol has
served as our Chief Executive Officer and a director since March 5, 2018 and in the additional role as Chairman of the Board since March 3, 2020. From January 2015 to February 2018 Mr. Niccol served as Chief Executive Officer of Taco Bell, a division of Yum! Brands, Inc., a global restaurant
company. He joined Taco Bell in 2011 as Chief Marketing and Innovation Officer and served as President from 2013 to 2014. Prior to his service at Taco Bell, from 2005 to 2011 he served in various executive positions at Pizza Hut, another division of Yum! Brands, including General Manager
and Chief Marketing Officer. Before joining Yum! Brands, Mr. Niccol spent 10 years at Procter & Gamble Co., serving in various brand management positions. Mr. Niccol holds an undergraduate degree from Miami University and an MBA from the University of Chicago Booth School of Business. He
serves as a director of Harley-Davidson, Inc. (through May 20, 2021).
Qualifications:
Mr. Niccol
brings us extensive experience in brand management, marketing and operations, as well as a proven track record of driving outstanding results at multiple restaurant brands. He also adds to the Board’s experience in corporate governance and public company oversight.
How I Chipotle:
Burrito bowl
with Barbacoa, brown rice, fajita veggies, cheese, romaine lettuce and tomatillo-green chili salsa and tomatillo-red chile salsa on the side, with a side of guacamole and chips.
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Mary Winston
Age: 59
Director Since:
2020
|
| |
Background:
Ms. Winston is
the Founder and President of WinsCo Enterprises, Inc., a consulting firm providing financial and board governance advisory services since 2016. She served as interim Chief Executive Officer of Bed Bath & Beyond from May 2019 to November 2019, and as Executive Vice President and Chief Financial
Officer of Family Dollar Stores, a leading discount retailer, from 2012 until it was acquired by Dollar Tree in 2015. Prior to that, Ms. Winston served as Senior Vice President and Chief Financial Officer of Giant Eagle, Inc., a supermarket chain from 2008 to 2012, and as Executive
Vice President and Chief Financial Officer of Scholastic Corporation, a global children’s publishing, education and media company from 2004 to 2007. Ms. Winston currently serves on the Boards of Directors of Acuity Brands, Inc., Dover Corporation, Bed Bath & Beyond and Domtar Corporation
(through May 5, 2021). Ms. Winston previously served on Board of Directors Plexus Corporation and Supervalu Inc. She holds a Bachelor’s degree in Accounting from the University of Wisconsin, an MBA in Finance, Marketing and International Business from Northwestern University’s Kellogg
Graduate School, and is a CPA, as well as a National Association of Corporate Directors (NACD) Board Leadership
Fellow.
Qualifications:
Ms. Winston
brings us extensive experience and expertise from years of broad financial management and executive leadership experience, including serving as CFO of three large companies. She also brings to the Board valuable experience in risk oversight and capital allocation, executive compensation and
general corporate governance matters.
How I Chipotle:
Burrito bowl
with 1/2 chicken, 1/2 Carne Asada, cauliflower rice, fajita veggies, cheese and fresh tomato salsa.
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2021 Proxy Statement 19
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|
|
|
Leadership
|
| |
Digital / Social Media / Consumer Trends
|
| ||||||
|
|
| |
(10 of 11 directors)
|
| |
|
| |
(6 of 11 directors)
|
|
|
(CEO or Executive Officer; Leader of large division, business unit or organization;
public company board service)
|
| |
(Digital/ecommerce capabilities to drive consumer engagement; social media strategy;
revenue opportunities)
|
| ||||||
|
Restaurant / Food Industry
|
| |
Real Estate / Commercial Leasing
|
| ||||||
|
|
| |
(5 of 11 directors)
|
| |
|
| |
(4 of 11 directors)
|
|
|
(Restaurant Owner/Manager; Sourcing & Supply; Food Safety / Quality Assurance)
|
| |
(Site selection; property management and administration)
|
| ||||||
|
HR / Talent Management / Compensation
|
| |
International Operations
|
| ||||||
|
|
| |
(5 of 11 directors)
|
| |
|
| |
(7 of 11 directors)
|
|
|
(Recruiting; talent development; diversity, equality & inclusion; management; HR
compliance)
|
| |
(Non-U.S. regulations, customs, organizational structures and tax implications and
planning)
|
| ||||||
|
Finance / Accounting
|
| |
Sustainability / ES&G
|
| ||||||
|
|
| |
(9 of 11 directors)
|
| |
|
| |
(5 of 11 directors)
|
|
|
(Financial Reporting; accounting systems; public reporting; Internal Controls)
|
| |
(Waste reduction, responsible sourcing, environmental impact, social & governance
issues)
|
| ||||||
|
Cybersecurity / IT Systems
|
| |
Government Relations
|
| ||||||
|
|
| |
(2 of 11 directors)
|
| |
|
| |
(2 of 11 directors)
|
|
|
(Cybersecurity; information technology systems and policies)
|
| |
(Lobbying, regulatory, investigations & compliance)
|
| ||||||
|
Risk Management
|
| |
Investor Relations
|
| ||||||
|
|
| |
(6 of 11 directors)
|
| |
|
| |
(10 of 11 directors)
|
|
|
(Evaluation, Assessment and Oversight)
|
| |
(Engagement regarding strategy, financial results, executive compensation and
corporate governance)
|
| ||||||
|
Branding / Marketing / Media
|
| |
|
| ||||||
|
|
| |
(6 of 11 directors)
|
| |
|
| |||
|
(Branding strategy & innovation; customer relations; crisis management)
|
| |
|
|
|
|
|
2021 Proxy Statement 20
|
|
|
|
|
|
2021 Proxy Statement 21
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|
|
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2021 Proxy Statement 22
|
|
|
|
Non-Employee Director Compensation
|
| |
Cash Retainer(1)
|
| |
Restricted Stock Units(2)
|
|
|
Annual Director Retainer
|
| |
$ 110,000
|
| |
$150,000
|
|
|
Committee Chair Retainers:
|
| |
|
| |
|
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|
Audit & Risk
|
| |
$ 30,000
|
| |
|
|
|
Compensation
|
| |
$ 25,000
|
| |
|
|
|
Nominating and Corporate Governance
|
| |
$ 20,000
|
| |
|
|
|
Committee Member Retainers (Excluding Committee Chair):
|
| |
|
| |
|
|
|
Audit & Risk
|
| |
$ 15,000
|
| |
|
|
|
Compensation
|
| |
$ 12,500
|
| |
|
|
|
Nominating and Corporate Governance
|
| |
$ 10,000
|
| |
|
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|
Lead Independent Director
|
| |
$ 50,000
|
| |
|
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(1)
|
All cash retainers are paid in arrears, on a pro rata basis, at the end of April and November.
|
(2)
|
An restricted stock unit (“RSU”) represents the right to receive shares of our common stock upon vesting. RSUs are granted to
non-employee directors on the date of our annual shareholders meeting each year. The number of shares subject to the award is based on the closing price of our common stock on the grant date.
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2021 Proxy Statement 23
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|
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Director
|
| |
Fees Earned or
Paid in Cash
|
| |
Stock Awards(1)
|
| |
Total
|
|
|
Albert S. Baldocchi
|
| |
$ 120,833
|
| |
$ 207,870
|
| |
$ 328,703
|
|
|
Paul Cappuccio(2)
|
| |
$ 60,417
|
| |
$57,518
|
| |
$117,935
|
|
|
Matthew A. Carey(3)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Gregg Engles(3)
|
| |
$ 43,709
|
| |
$ 126,824
|
| |
$ 170,533
|
|
|
Patricia Fili-Krushel
|
| |
$ 112,292
|
| |
$ 207,870
|
| |
$ 320,162
|
|
|
Neil W. Flanzraich
|
| |
$ 178,750
|
| |
$ 207,870
|
| |
$ 386,620
|
|
|
Mauricio Gutierrez(3)
|
| |
—
|
| |
—
|
| |
—
|
|
|
Robin Hickenlooper
|
| |
$ 128,750
|
| |
$ 207,870
|
| |
$ 336,620
|
|
|
Scott Maw
|
| |
$ 122,083
|
| |
$ 207,870
|
| |
$ 329,953
|
|
|
Ali Namvar
|
| |
$121,458
|
| |
$ 207,870
|
| |
$ 329,328
|
|
|
Matthew Paull(2)
|
| |
$51,042
|
| |
$57,518
|
| |
$ 108,560
|
|
|
Mary Winston(3)
|
| |
$44,231
|
| |
$126,824
|
| |
$171,055
|
|
(1)
|
Reflects the grant date fair value under FASB Topic 718 of RSUs awarded for the equity portion of each non-employee director’s annual
retainer. On May 19, 2020, RSUs in respect of 206 shares of common stock were granted to each non-employee director who was re-elected to the Board, which RSUs were valued at $1,009.08 per share, the closing price of Chipotle common stock
on the grant date. The grant covered (i) the one year service period from the May 2020 annual meeting to the May 2021 annual meeting, which RSUs vest on the first anniversary of the grant date subject to the director’s continued service
as a director through that date, plus (ii) the transition period of January 2020 to May 2020 as we switched the director compensation time period from a calendar year basis to the one-year period running from May to May, which RSU vested
on the date of grant because they were granted in arrears at the end of the service period. Under the terms of the award agreements, vesting accelerates in the event of the retirement of a director who has served for a total of six years
(including any breaks in service), or in the event the director leaves the Board following a change in control of Chipotle. Directors may elect to defer receipt upon vesting of the shares underlying the RSUs; however, none of the
directors elected this deferral option in 2020. As of December 31, 2020, Messrs. Baldocchi, Flanzraich, Maw and Namvar and Meses. Fili-Krushel and Hickenlooper each held 149 RSUs, and Mr. Engles and Ms. Winston each held 107 RSUs.
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(2)
|
Messrs. Cappuccio and Paull served on the Board from January through May 2020 and received pro rata compensation for 2020.
|
(3)
|
Mr. Engles and Ms. Winston joined the Board in July 2020 and received pro rata compensation for 2020; Messrs. Carey and Gutierrez
joined the Board in March 2021 and received no compensation for 2020.
|
|
|
|
2021 Proxy Statement 24
|
|
|
|
|
|
2021 Proxy Statement 25
|
|
|
■
|
integrity and business ethics;
|
■
|
strength of character and judgment;
|
■
|
ability and willingness to devote sufficient time to Board duties;
|
■
|
potential contribution to the diversity and culture of the Board;
|
■
|
business and professional achievements and experience and industry background, particularly in light of
our principal business and strategies, and alignment with our vision and values;
|
■
|
independence from management, including under requirements of applicable law and listing standards, and
any potential conflicts of interest arising from their other business activities; and
|
■
|
experience on public company boards and knowledge of corporate governance practices.
|
|
|
|
2021 Proxy Statement 26
|
|
|
|
|
|
2021 Proxy Statement 27
|
|
|
|
Timing/Frequency
|
| |
Chipotle Participants
|
| |
Discussion Topics
|
|
|
Annual Meeting-Related
|
| ||||||
|
Early in year, usually after fiscal year earnings are announced and before our first
quarter Board meeting, and again after the proxy statement is filed
|
| |
■ Representatives from any
or all of our Investor Relations, Corporate Secretary, Corporate Governance and Compensation and Sustainability
functions
■ Lead Independent Director
■ Chair of our Compensation
or Nominating & Corporate Governance Committees may participate
|
| |
■ Executive compensation, including
award design & performance metrics
■ Incentive and equity plan parameters
■ Board composition,
refreshment, nomination & election procedures
and related matters
■ Corporate governance
■ Sustainability,
environmental, human capital management and diversity
matters
■ Proxy statement disclosures
|
|
|
Issue-Based Engagement
|
| ||||||
|
Before or after the proxy statement is filed
|
| |
■ Representatives from any
or all of our Investor Relations, Corporate Secretary, Corporate Governance and Compensation and Sustainability
functions
■ Lead Independent Director
■ Chair of our Compensation
or Nominating & Corporate Governance Committees may participate
|
| |
■ Shareholder proposals submitted for
the proxy
■ Proposed changes to our executive
compensation program
■ In 2020/2021, the impact
of COVID-19 on our business and executive compensation program and the company’s response to the
COVID-19 pandemic
|
|
|
Investor Meetings and Conferences
|
| ||||||
|
Throughout the year (meetings with investors at company or investor offices, at
analyst-sponsored conferences)
|
| |
■ Senior Management and
Investor Relations
|
| |
■ Company strategy
■ Financial results and outlook
|
|
|
Investor Calls - Earnings
|
| ||||||
|
Quarterly and special calls from time to time
|
| |
■ Senior Management and
Investor Relations
|
| |
■ Company strategy
■ Financial results and outlook
|
|
|
|
|
2021 Proxy Statement 28
|
|
|
|
|
| |
Areas of Risk Oversight
|
| |||
|
Board of Directors
|
| |
■
|
| |
Our strategic plans, financial and operating performance and shareholder returns
|
|
|
■
|
| |
Overall risk assessment and mitigation of critical risks
|
| |||
|
■
|
| |
Corporate sustainability initiatives
|
| |||
|
■
|
| |
Regular review and analysis with management of most significant business risks as
identified by the Board, the Audit & Risk Committee, and/or management
|
| |||
|
■
|
| |
Succession planning process for our CEO and other executive officers and development
of senior management
|
| |||
|
Audit & Risk Committee
|
| |
■
|
| |
Accounting practices and policies, financial statements and reporting and disclosure
controls and procedures and internal controls
|
|
|
■
|
| |
Internal controls and the performance of the internal audit function
|
| |||
|
■
|
| |
Performance of the independent registered public accountants and the lead audit
partner
|
| |||
|
■
|
| |
Cyber security and data privacy programs, policies and risk assessment and mitigation
|
| |||
|
■
|
| |
Ethics and Compliance program, including the whistleblower hotline and procedures for
the receipt, retention and treatment of complaints, and the company’s risk management framework and the process for identifying, assessing and mitigating key risks
|
| |||
|
■
|
| |
Compliance with legal and regulatory requirements and the company’s response to
actual and alleged violations, including claims of harassment, discrimination or other violations of applicable employment laws
|
| |||
|
■
|
| | |
|
|
|
2021 Proxy Statement 29
|
|
|
|
|
| |
Areas of Risk Oversight
|
| |||
|
Compensation Committee
|
| |
■
|
| |
Compensation and evaluation of our CEO and the compensation of our other executive
officers, including employment agreements and post-service arrangements and perquisites
|
|
|
■
|
| |
Evaluation of risks relating to our compensation programs
|
| |||
|
■
|
| |
Human capital management, including diversity and inclusion programs and initiatives,
recruitment and retention of employees, pay equity and relative compensation and benefits offered to employees across the company
|
| |||
|
■
|
| |
Our compensation and benefits programs generally, including retirement and welfare
plans and equity compensation plans
|
| |||
|
■
|
| |
Stock ownership policy
|
| |||
|
■
|
| |
Director compensation program
|
| |||
|
Nominating and Corporate Governance Committee
|
| |
■
|
| |
Corporate governance policies and processes
|
|
|
■
|
| |
Compliance with key corporate governance documents, including our Corporate
Governance Guidelines and Committee charters
|
| |||
|
■
|
| |
Board refreshment and identification, evaluation and selection of potential director
candidates
|
| |||
|
■
|
| |
Annual process of evaluating the performance of the Board and each Committee
|
| |||
|
■
|
| |
Policies and programs relating to social responsibility, corporate citizenship and
public policy issues significant to the company
|
|
|
|
|
2021 Proxy Statement 30
|
|
|
■
|
Expanded our paid emergency leave benefits to accommodate employees directly affected by COVID-19
|
■
|
Provided 30-day personal leave with automatic approval for any COVID-19 related reason
|
■
|
Extended access to telemedicine coverage to employees and their families
|
■
|
Expanded Employee Assistance Program coverage and Concierge Service for employees and their families
|
■
|
Removed the minimum hours worked requirement for access to our Tuition Assistance & Debt-free-degree
programs
|
■
|
Provided hourly assistance pay equal to a 10% increase to all hourly base wages
|
■
|
Provided a discretionary bonus in each quarter, in either cash or equity, to our restaurant salaried managers under our Quarterly Bonus Plan.
|
■
|
Provided an additional assistance pay bonus to our salaried restaurant managers
|
|
|
|
2021 Proxy Statement 31
|
|
|
■
|
Tractor Beverage Co. Partnership - All TRACTOR BEVERAGES sold by Chipotle help support the U.S.
agricultural industry, with 5% of Chipotle's profits from its sale of these beverages being donated to causes that benefit farmers. Funds expand Chipotle's
existing farmer programs including long-term contracts, increased local sourcing, scholarships and grants to start, run or grow farming operations, among others.
|
■
|
Virtual Farmers Market – We are supporting farmers in our supply chain by assisting in the development
of eCommerce sites within the CHIPOTLE VIRTUAL FARMERS MARKET, an online marketplace where consumers can buy real ingredients online, directly from the brand's
suppliers.
|
■
|
Young Farmers - To date, Chipotle and the Chipotle Cultivate Foundation have contributed over $500,000
to support the next generation of farmers. The brand is EMPOWERING THE INDUSTRY by offering education, scholarships, grants, and three-year contracts to young
farmers.
|
■
|
Aluminaries – Our ALUMINARIES PROJECT 2.0 accelerator program has helped growth stage ventures across
the country advance innovative solutions in farming.
|
|
|
|
2021 Proxy Statement 32
|
|
|
|
|
|
2021 Proxy Statement 33
|
|
|
|
Proposal 2
|
|
|
|
|
2021 Proxy Statement 34
|
|
|
|
Proposal 3
|
|
■
|
Ernst & Young’s capabilities considering the scope and complexity of our business, and the resulting
demands placed on Ernst & Young in terms of technical expertise and knowledge of our industry and business;
|
■
|
the quality and candor of Ernst & Young’s communications with the Committee and management;
|
■
|
Ernst & Young’s independence;
|
■
|
the quality and efficiency of the services provided by Ernst & Young, including input from
management on Ernst & Young’s performance and how effectively Ernst & Young demonstrated its independent judgment, objectivity and professional skepticism;
|
■
|
external data on audit quality and performance, including recent Public Company Accounting Oversight
Board (PCAOB) reports on Ernst & Young and its peer firms; and
|
■
|
the appropriateness of Ernst & Young’s fees, tenure as our independent registered public accountants, including the benefits of a longer tenure, and the controls and processes in place that help ensure Ernst & Young’s
continued independence.
|
|
|
|
2021 Proxy Statement 35
|
|
|
|
Fees for Services
|
| |
2020
|
| |
2019
|
|
|
Audit Fees(1)
|
| |
$ 1,400,200
|
| |
$1,117,526
|
|
|
Audit-Related Fees
|
| |
—
|
| |
—
|
|
|
Tax Fees(2)
|
| |
$591,705
|
| |
$ 119,480
|
|
|
All Other Fees
|
| |
$1,300
|
| |
$ 20,605
|
|
|
Total Fees
|
| |
$1,993,205
|
| |
$1,257,611
|
|
(1)
|
Includes fees and expenses related to the fiscal year audit and interim reviews, notwithstanding when the fees and expenses were
billed or when the services were rendered. Audit fees also include fees and expenses, if any, related to SEC filings, comfort letters, consents, SEC comment letters and accounting consultations.
|
(2)
|
Represents fees for tax consulting and advisory services.
|
|
|
|
2021 Proxy Statement 36
|
|
|
|
|
|
2021 Proxy Statement 37
|
|
|
■
|
all shareholders have the opportunity to openly express views on proposed actions and to participate in
the meeting and the shareholder vote;
|
■
|
the meeting and the shareholder vote occur in a transparent manner, at a date and time publicly
announced in advance of the meeting;
|
■
|
accurate and complete information about the proposed shareholder action is widely distributed in the
proxy statement before the meeting, which promotes a well-informed discussion on the merits of the proposed action; and
|
■
|
the Board is able to analyze and provide a recommendation with respect to actions proposed to be taken
at a shareholder meeting.
|
■
|
Under our bylaws,
shareholders holding 25% or more of our shares may call a special meeting and present matters for a vote by all shareholders, which is a more transparent and equitable process for shareholders than
the written consent process. Any investor group that wants to act by written consent could instead simply call a special meeting and allow for constructive deliberation
and voting at the special meeting.
|
■
|
“Proxy access” rights contained in our bylaws allow eligible shareholders to include their chosen nominees for director in our proxy materials along with the Board-nominated candidates.
|
■
|
We have an extensive shareholder engagement process that allows shareholders to bring matters to the
attention of the Board and management outside of the annual meeting process. See the section titled “Shareholder Engagement” on page 27.
|
■
|
Annual election of all directors;
|
■
|
Majority vote standard to elect directors;
|
■
|
Election by the independent directors of the Lead Independent Director who has a clearly defined and
robust role;
|
■
|
Our director share ownership requirement;
|
■
|
Annual advisory vote to approve executive compensation;
|
■
|
No supermajority voting provisions; and
|
■
|
Our shareholders’ right to directly communicate with and raise concerns to the Board or an individual
director.
|
|
|
|
2021 Proxy Statement 38
|
|
|
|
Executive Officers
|
| |||
|
|
| |
Marissa Andrada, 53, serves as
our Chief Diversity, Inclusion and People Officer. Prior to joining Chipotle in April 2018, Ms. Andrada was Senior Vice President of Human Resources & Chief Human Resources Officer at Kate Spade & Company, a fashion company, from July 2016 through October 2017, and Senior Vice President of Partner Resources for Starbucks
Corporation, a global coffee roaster and retailer, from November 2010 to March 2016. Prior to Starbucks, she served as Senior Vice President of Human Resources
at GameStop Corporation and Head of Human Resources at Red Bull North America. Ms. Andrada holds a Masters of Business degree from Pepperdine University.
|
|
|
|
| |
Scott Boatwright, 48, serves as
Chief Restaurant Officer and has direct accountability for all restaurant operations. Prior to Chipotle in May 2017, Mr. Boatwright spent 18 years with Arby’s Restaurant Group, a quick serve restaurant company, in various leadership positions, including for the last six years as the Sr. Vice President of Operations, where he was responsible
for the performance of over 1,700 Arby’s restaurants in numerous states. Mr. Boatwright holds an MBA from the J. Mack Robinson College of Business at
Georgia State University.
|
|
|
|
| |
Chris Brandt, 52, has served as
Chief Marketing Officer since April 2018. Prior to joining Chipotle, Mr. Brandt was Executive Vice President and Chief Brand Officer of Bloomin’ Brands, Inc., a casual dining company, from May 2016 through December 2017; Chief Brand Officer/Chief Marketing Officer for Taco Bell, a subsidiary of Yum! Brands, Inc., a global restaurant
company, from May 2013 to May 2016; and Senior Director and Vice President of Marketing for Taco Bell from November 2010 to May 2013. Mr. Brandt holds
an MBA from the Anderson School at UCLA.
|
|
|
|
| |
Curt Garner, 51, has served as
Chief Technology Officer since March 2017. Mr. Garner joined Chipotle in November 2015 as Chief Information Officer, and prior to that worked for Starbucks Corporation, a global coffee roaster and retailer, for 17 years, most recently serving as Executive Vice President and Chief Information Officer. Mr. Garner has a Bachelor of Arts
degree in economics from The Ohio State University.
|
|
|
|
| |
John R. (Jack) Hartung, 63, has
served as Chief Financial Officer since 2002. In addition to having responsibility for all of our financial and reporting functions, Mr. Hartung also oversees supply chain, real estate and development and Chipotle’s European operations. He joined Chipotle after spending 18 years at McDonald’s Corp., a quick serve restaurant company, where
he held a variety of management positions, most recently as Vice President and Chief Financial Officer of its Partner Brands Group. Mr. Hartung has a
Bachelor of Science degree in accounting and economics as well as an MBA from Illinois State University.
|
|
|
|
| |
Laurie Schalow, 53, serves as
our Chief Corporate Affairs and Food Safety Officer. Prior to joining Chipotle in August 2017, Ms. Schalow served as Vice President of Public Affairs for Yum! Brands, a global restaurant company, overseeing Global Corporate Social Responsibility, PR, Crisis Management, Social Listening and Community Diversity programs for the 44,000 KFC,
Pizza Hut and Taco Bell restaurants in 140 countries. Ms. Schalow holds an MBA from Case Western Reserve and Wayne State University. She currently
serves on the Board of Directors for The Muhammad Ali Center.
|
|
|
|
| |
Roger Theodoredis, 62, has
served as Chief Legal Officer and General Counsel since October 2018. Prior to joining Chipotle, Mr. Theodoredis was General Secretary of Danone North America, with responsibility for legal, public affairs, communications, scientific affairs and corporate security. He previously served as Executive Vice President, General Counsel and
Corporate Secretary of The WhiteWave Foods Company, a food and beverage company, until its acquisition by Danone, S.A. in April 2017, having been appointed as General Counsel of WhiteWave Foods in 2005. Prior to joining WhiteWave Foods, Mr. Theodoredis served as Division General Counsel for Mead Johnson Nutritionals, a subsidiary of
Bristol Myers Squibb, and in a number of legal roles for Chiquita Brands International. He holds a J.D. from Boston University School of Law.
|
|
|
|
|
2021 Proxy Statement 39
|
|
|
■
|
Enhancing our industry leading food safety protocols to account for risks related to COVID-19.
|
■
|
Hiring approximately 114,120 new employees, providing jobs with industry-leading benefits, including
access to mental and telehealth resources, to our employees and their families, and developing 11,000 individuals with internal promotions.
|
■
|
Paying out nearly $40.0
million in discretionary bonuses and assistance pay to our in-restaurant employees and
over $13.0 million in tuition costs for employees seeking to advance their education.
|
■
|
Prioritizing diversity, equity and inclusion efforts across the company and raising nearly $4.0 million in support of organizations helping underserved communities.
|
■
|
Investing in the future of farming through grants, long-term contracts and the Aluminaries Project 2.0.
|
■
|
Revenue increased 7.1%, to $6.0 billion.
|
■
|
Comparable restaurant sales increased 1.8%.
|
■
|
Digital sales increased 174.1% and accounted for 46.2% of sales.
|
■
|
Restaurant level operating margin was 17.4%.
|
■
|
We opened 161 new restaurants, including six relocations, which included 100 “Chipotlanes.”
|
|
|
|
2021 Proxy Statement 40
|
|
|
■
|
Brian Niccol, Chairman and CEO
|
■
|
Jack Hartung, CFO
|
■
|
Curt Garner, Chief Technology Officer
|
■
|
Scott Boatwright, Chief Restaurant Officer
|
■
|
Chris Brandt, Chief Marketing Officer
|
|
Shareholder Value Creation
|
| ||||||
|
+$30.6B
2018-2020
market cap growth
|
| |
+380%
Cumulative
2018-2020 TSR
|
| |
#7
2018-2020 TSR
versus S&P 500
|
|
|
Financial
|
| |
Strategic
|
| |
Operational
|
|
|
+7.1%
Revenue
year-over-year
|
| |
~18.6 million
Members
enrolled in our loyalty program
|
| |
161
New
restaurants opened, and 100 with Chipotlanes
|
|
|
+1.8%
Comparable
restaurant sales
growth
|
| |
174.1%
Growth in
digital sales to 46.2% of total sales
|
| |
$40.0 million
Paid in
COVID-related discretionary bonuses and assistance pay to restaurant employees
|
|
|
|
|
2021 Proxy Statement 41
|
|
|
|
| |
|
| |
|
| |
|
Financial
|
| |
Strategic
|
| |
Operational
|
| |
ESG
|
■ Increased revenue to $6.0 billion, an increase of
7.1% from 2019.
■ Maintained strong
restaurant level operating margin at 17.4%, despite incremental
COVID-related expenses.
■ Grew comparable restaurant
sales by 1.8%.
■ Grew digital sales to
46.2% of total sales, an increase of 174.1% from 2019.
|
| |
■ Continued to enhance our food safety practices and earned the highest ever average score in our independent third-party
food
safety audits.
■ Added over 10 million members to our “Chipotle Rewards” loyalty program, increasing the number of enrolled members to
approx.
18.6 million people
■ Expanded our delivery capabilities by partnering with several additional
delivery services.
■ Launched several
innovative menu items that generated outstanding guest response, including the return of Carne Asada, a premium seasoned steak, a new line of organic beverages and new celebrity-lifestyle bowls.
|
| |
■ Opened 161 new
restaurants, 100 of which were Chipotlanes, bringing our total to 2,768 restaurants and
170 Chipotlanes.
■ Received numerous awards and recognition, including from Forbes (one of the Best Employers for Diversity and World’s Best
Employers), Fortune (on the annual list of World’s Most Admired Companies), and Newsweek (America’s Most Responsible Companies and Restaurant Dive’s Company of the Year). We also were included in the 2020 Bloomberg Gender-Equality Index and recognized as a top employer for equality by the Human Rights Campaign Foundation’s Corporate
Equality Index.
■ Offered industry leading employee rewards and benefits, including paying nearly $40.0 million in discretionary bonuses and
assistance pay to our restaurant employees plus over $13.0 million in tuition assistance
and debt-free degrees, as well as offering our employees an array of medical, mental health and
financial wellness benefits.
■ While unemployment skyrocketed during the pandemic, we hired approximately 114,120 new employees that supported the global economy, while maintaining diversity, equity and inclusiveness throughout our
workforce.
|
| |
■ We launched Real
Foodprint, a sustainability impact tracker that shows how our ingredients are better for the planet and we purchased 28.1 pounds of organic and
transitional ingredients.
■ To care for our employees
during the pandemic, we expanded our paid emergency leave benefits to accommodate
employees directly affected by COVID-19, provided 30-day personal leave with automatic
approval for any COVID-19 related reason, and extended access to telemedicine coverage to
employees and their families.
■ We pledged $1.0 million in
support of organizations advocating against systemic racism in our society and expanded listening sessions for employees to learn how we can further
evolve as a company and provide equal access to opportunities to all our employees.
|
|
|
|
2021 Proxy Statement 42
|
|
|
*
|
Year-over-year comparable restaurant sales for Chipotle compared to its fast casual/casual dining peers that, pre-COVID, generated
more than 50% of sales from on-premise/dine in restaurant orders and that have limited drive through capabilities. Data compiled from quarterly earnings announcements.
|
(i)
|
Excluded three months (March, April and May 2020) from the calculations of comparable restaurant sales (“CRS”) and restaurant cash
flow (“RCF”) margin in which CRS growth was below -7.5%. For the PSUs, this is only three of 36 months in the performance period. These were months in which CRS growth was severely impacted by COVID-related government restrictions. These
restrictions required us to completely close some of our restaurants, close many of our dining rooms, limit our offerings to takeout and delivery, and/or implement modified work hours.
|
(ii)
|
Excluded certain COVID-related expenses (i.e., the net increase in delivery costs) in the calculation of RCF margin from the remaining
months of 2020. We excluded these costs due to the unexpected, sudden and significant spike in delivery costs caused by the pandemic and our inability to rapidly offset these unexpectedly higher costs.
|
(iii)
|
Reduced the maximum payout opportunity for the 2018-20 PSUs to 275% from the original 300%, which was set to acknowledge the business
turnaround the executive leadership team was expected to achieve.
|
|
|
|
2021 Proxy Statement 43
|
|
|
|
|
| |
Incremental
Value from 2020
Bonus Modification(1)
|
| |
Incremental
Value from 2018-20
PSU Modification(2)
|
| |
Total Incremental
Value from
Modification
|
|
|
Brian Niccol
|
| |
$ 1,350,000
|
| |
$22,201,091
|
| |
$ 23,551,091
|
|
|
Jack Hartung
|
| |
$ 464,550
|
| |
$13,321,204
|
| |
$ 13,785,754
|
|
|
Curt Garner
|
| |
$ 324,000
|
| |
$11,988,259
|
| |
$12,312,259
|
|
|
Scott Boatwright
|
| |
$ 252,000
|
| |
$7,548,316
|
| |
$ 7,800,316
|
|
|
Chris Brandt
|
| |
$312,000
|
| |
$6,661,976
|
| |
$ 6,973,976
|
|
|
Total
|
| |
$2,702,550
|
| |
$61,720,846
|
| |
$ 64,423,396
|
|
(1)
|
Included in “Non-Equity Incentive Plan Compensation” in the “2020 Summary Compensation Table.”
|
(2)
|
Included in “Stock Awards” in the “2020 Summary Compensation Table.” The grant date fair value for the 2018-20 PSUs was included in
compensation for 2018.
|
|
|
|
2021 Proxy Statement 44
|
|
|
|
What We Do
|
| |
What We Don’t Do
|
|
|
Conduct extensive shareholder engagement on compensation, environmental, social and governance (ESG) related matters. Engage in careful consideration of the annual say
on pay results and solicit and respond to shareholder feedback when deemed
appropriate.
Employ an annual LTI plan based predominantly on performance-based equity awards that fully vest over
a minimum of 36 months.
Align our executive compensation with achieving meaningful financial, operational and individual goals
that drive shareholder value.
Design our executive compensation program to discourage excessive risk taking, with design features including the incorporation of multiple performance measures in our
incentive programs, robust executive stock ownership guidelines, long-term performance goals and minimum three-year periods for full vesting
on annual LTI awards.
Retain an independent compensation consultant who is engaged directly by the Compensation Committee
to advise on executive compensation matters.
Maintain a Clawback and Recoupment of Compensation Policy that allows the Board to seek reimbursement of incentive compensation paid or awarded to an executive officer
if it was based on financial results that subsequently were restated, and to require forfeiture of an executive officer’s compensation if they engaged in egregious conduct substantially detrimental to the company.
|
| |
Allow executive officers and directors to hedge or pledge shares of Chipotle stock or hold Chipotle stock
in margin accounts.
Allow stock option repricing, reloads, exchanges or options granted below market value without
shareholder approval.
Provide single trigger acceleration of equity awards in
connection with a change in control.
Allow the Compensation Committee’s consultant to perform additional work for or on behalf of management.
|
|
■
|
Position our target total direct compensation (base salary, target annual incentive bonus opportunity
and target LTI opportunity) at a level where we can successfully recruit and retain industry leading talent critical to shaping and executing our business
strategy and creating long-term value for our shareholders.
|
■
|
Align relative realized pay with relative performance versus peers by emphasizing long-term equity over
short-term cash and performance-based compensation over time-vested compensation.
|
■
|
Differentiate executive rewards based on actual performance.
|
■
|
Align the interests of our executives and shareholders by rewarding the achievement of financial,
operational, and strategic goals that we believe enhance long-term shareholder value.
|
|
|
|
2021 Proxy Statement 45
|
|
|
|
Base Salary
|
| |
Annual Incentive Plan
|
| |
Equity Compensation
|
|
|
Purpose: Attract and retain executives and provide a fixed, compensation element.
Key features: Determined based
on the position’s importance within Chipotle, the executive’s experience, and external market data.
|
| |
Purpose: Incentivize
achievement of annual financial, operating and individual goals.
Key features: Our company-wide
AIP provides for variable cash payouts based on achievement against operating and financial performance goals approved by the Committee at the beginning of each year, as well as evaluations of performance against individual goals and objectives.
|
| |
Purpose: Align the incentives
of our executive officers with shareholder interests and reward the creation of shareholder value.
Key features: LTI mix for 2020
was 60% PSUs with a three-year performance period, 20% seven-year stock only stock appreciation rights (“SOSARs”) that vest in two equal installments on the 2nd and 3rd anniversaries of the grant date, and 20% choice between SOSARs or RSUs that vest in two equal installments on the 2nd and 3rd anniversaries of the grant date.
|
|
■
|
Chipotle’s performance relative to goals approved by the Committee
|
■
|
Each executive officer’s experience, knowledge, skills and personal contributions
|
■
|
Levels of compensation for similar jobs at market reference points
|
■
|
The business climate in the restaurant industry, general economic conditions and other factors
|
|
|
|
2021 Proxy Statement 46
|
|
|
|
Responsible Party
|
| |
Role and Responsibilities
|
|
|
Compensation Committee The Committee is currently comprised of four independent directors and reports to the Board
|
| |
■ Retains independent consultants to assist it in
evaluating compensation and
fulfilling its obligations as set forth in its
charter.
■ Works with the CEO to set performance goals at the
beginning of each year
targeted to positively incentivize shareholder
value creation.
■ Evaluates CEO performance in relation to those goals
and Chipotle’s overall
performance.
■ Determines and approves compensation for our
executive officers.
■ Reviews and approves overall compensation philosophy
and strategy, as well as all
compensation and benefits programs in which our
executive officers participate.
■ Approves applicable peer group and broader market
data as reference points to
help inform determination on NEO pay levels and
program design.
■ Conducts an annual
assessment of potential compensation-related risks to Chipotle and oversees policies and practices to mitigate such risk, including
performance-based incentive arrangements below the
executive level.
■ Engages with shareholders
and other stakeholders to receive input on executive compensation matters.
|
|
|
Independent Consultant to the Compensation Committee
The
Committee retains an independent compensation consultant to provide consulting advice on matters of governance and executive compensation.
|
| |
■ Provides advice and
opinion on the appropriateness and competitiveness of our compensation program relative to market practice, our strategy and internal
processes, and compensation-related risk
mitigation.
■ Provides advice regarding compensation
decision-making governance.
■ Provides market data, as requested.
■ Performs functions at the direction of the Committee.
■ Attends Committee meetings when requested. Consults on various compensation
matters, as reflected in the Committee’s charter.
■ Confers with the Committee and, at the direction of the Committee, select members of the company’s management team on defined compensation-related matters.
|
|
|
CEO
Makes
recommendations with the support of other
members of the management team, including the internal compensation and benefits team
|
| |
■ Works with the other
executive officers to recommend performance goals at the beginning of each year that are targeted to positively incentivize shareholder value creation, with all
performance goals reviewed and approved by the Compensation
Committee.
■ Reviews performance of the other executive officers
and makes recommendations
to the Committee with respect to their
compensation.
■ Confers with the Committee
concerning design and development of compensation and benefit plans for Chipotle executive officers and employees.
|
|
|
|
|
2021 Proxy Statement 47
|
|
|
|
Company Name
|
| |
Revenues(1)
|
| |
Market Cap(2)
|
|
|
Darden Restaurants, Inc.
|
| |
$6,801
|
| |
$15,509
|
|
|
Domino's Pizza, Inc.
|
| |
$3,911
|
| |
$15,108
|
|
|
Dunkin' Brands Group, Inc.
|
| |
$1,308
|
| |
N/A(3)
|
|
|
Expedia Group, Inc.
|
| |
$5,199
|
| |
$18,729
|
|
|
Hilton Worldwide Holdings, Inc.
|
| |
$2,162
|
| |
$30,869
|
|
|
Lululemon Athletica Inc.
|
| |
$4,070
|
| |
$45,362
|
|
|
McDonald's Corporation
|
| |
$19,034
|
| |
$159,886
|
|
|
Norwegian Cruise Line Holdings Ltd.
|
| |
$2,751
|
| |
$8,027
|
|
|
Restaurant Brands International Inc.
|
| |
$5,089
|
| |
$18,571
|
|
|
Royal Caribbean Group
|
| |
$4,692
|
| |
$17,730
|
|
|
Starbucks Corporation
|
| |
$23,170
|
| |
$125,562
|
|
|
Ulta Beauty, Inc.
|
| |
$6,259
|
| |
$16,178
|
|
|
Vail Resorts, Inc.
|
| |
$1,828
|
| |
$11,238
|
|
|
YUM! Brands, Inc.
|
| |
$5,603
|
| |
$32,749
|
|
|
Peer Group Median
|
| |
$4,891
|
| |
$18,571
|
|
|
Chipotle Mexican Grill, Inc.
|
| |
$5,817
|
| |
$38,801
|
|
|
Percent Rank
|
| |
72%
|
| |
79%
|
|
(1)
|
Trailing 12 months, as of December 31, 2020.
|
(2)
|
As of December 31, 2020.
|
(3)
|
Taken private in 2020.
|
|
|
|
2021 Proxy Statement 48
|
|
|
|
|
| |
Base Salaries
|
| ||||||
|
NEO
|
| |
2020(1)
|
| |
2019
|
| |
% Change
|
|
|
Brian Niccol
|
| |
$1,250,000
|
| |
$1,200,000
|
| |
4.2%
|
|
|
Jack Hartung
|
| |
$815,000
|
| |
$ 800,000
|
| |
1.9%
|
|
|
Curt Garner
|
| |
$675,000
|
| |
$620,000
|
| |
8.9%
|
|
|
Scott Boatwright
|
| |
$525,000
|
| |
$475,000
|
| |
10.5%
|
|
|
Chris Brandt
|
| |
$650,000
|
| |
$620,000
|
| |
4.8%
|
|
(1)
|
2020 salaries were effective February 17, 2020 and therefore may not match the salary numbers in the 2020 Summary Compensation Table.
|
|
|
|
2021 Proxy Statement 49
|
|
|
|
|
| |
AIP Targets (% of Base Salary)
|
| ||||||
|
NEO
|
| |
2020
|
| |
2019
|
| |
% Change
|
|
|
Brian Niccol
|
| |
180%
|
| |
150%
|
| |
30%
|
|
|
Jack Hartung
|
| |
95%
|
| |
85%
|
| |
10%
|
|
|
Curt Garner
|
| |
80%
|
| |
70%
|
| |
10%
|
|
|
Scott Boatwright
|
| |
80%
|
| |
70%
|
| |
10%
|
|
|
Chris Brandt
|
| |
80%
|
| |
70%
|
| |
10%
|
|
|
|
|
2021 Proxy Statement 50
|
|
|
|
Brian Niccol (IPF: 200%)
|
| |
■
|
| |
Created and led a cross-functional team to successfully manage unexpected changes
caused by the COVID-19 pandemic, including navigating mandatory restaurant closures and varying governmental restrictions, enhancing our food safety and overall safety protocols, offering industry-leading enhancements to benefits and
compensation at a time when many companies furloughed or laid off employees and continuing to engage our remote workforce toward achievement of our strategic priorities.
|
|
|
|
| |
■
|
| |
Continued to deliver on our purpose of Cultivating a Better World by building
capabilities including systems, policies, training, auditing and reporting to enhance a culture of Compliance and created and implemented policies and training including the relaunch of our Code of Ethics, DE&I Foundations and
Anti-Harassment program. In 2020 we received external recognition for creating cultural equity for employees from Bloomberg (Gender Equality Index), Forbes (Best Employers for Diversity and other categories), Human Rights Campaign (Best
Places to Work for LGBTQ) and Fortune (World’s Most Admired Companies).
|
|
|
|
| |
■
|
| |
In light of the pandemic, we delivered outstanding financial results including
7.1% revenue growth, restaurant level margin of 17.4%, comparable restaurant sales growth of 1.8% and the opening of 161 new restaurants.
|
|
|
|
| |
■
|
| |
Made meaningful progress on goals set in the 2018 Sustainability Report and 2019
Sustainability Report Update, including making a commitment to Science Based Targets in alignment with the Paris Agreement, saving 65.6 million KWH of energy in 2020 and reducing our annual energy usage by nearly 13% per restaurant via
our in-restaurant Energy Management System, and sourcing over 20% of all of our electricity from renewable resources.
|
|
|
Jack Hartung (IPF: 175%)
|
| |
■
|
| |
Rigorously managed our financial liquidity needs through the pandemic and
proactively implemented actions to reduce cash outlays and expenses, including suspending our stock buyback program, obtaining a $600 million line of credit (which remains untapped), minimizing waste, effectively managing labor hours,
reducing non-essential controllable costs, halting all non-essential travel and expenses and delaying non-essential reinvestments. As of December 31, 2020, we had a cash and marketable investments balance of $1.1 billion, excluding
restricted cash of $27.8 million.
|
|
|
|
| |
■
|
| |
Despite the pandemic, ensured stable supply of all of our food and packaging, as
well as PPE, cleaners and sanitizers, which were in short supply and high demand.
|
|
|
|
| |
■
|
| |
Leveraged the availability of commercial real estate and opened 161 new
restaurants during 2020, of which 100 (or 62%) included a Chipotlane. This brings our total number of Chipotlanes as of year-end to 170.
|
|
|
|
|
2021 Proxy Statement 51
|
|
|
|
Curt Garner (IPF: 200%)
|
| |
■
|
| |
Successfully implemented technology 2020 roadmap projects on time and within
budget, increasing scale, stability and security to successfully manage the rapid increase in digital transactions; achieved improvement in all key metrics including digital commerce response time, outages and fraud, despite the large
increase in volume on the platforms.
|
|
|
|
| |
■
|
| |
Expanded our data analytics and insights organization and capabilities by
implementing a comprehensive customer data platform and new business reporting tools.
|
|
|
|
| |
■
|
| |
Strengthened our information security and fraud capabilities by adding world class
talent, developing a holistic strategy and implementing processes tools and technologies.
|
|
|
|
| |
■
|
| |
Defined technology platform standards and organizational models to prepare for
international growth.
|
|
|
Scott Boatwright (IPF: 200%)
|
| |
■
|
| |
Invested in general manager development, including developing over 240 certified
training managers to ensure foundational training success of future leaders, which decreased general manager turnover by almost 7%.
|
|
|
|
| |
■
|
| |
Continued to cultivate a food safety culture and deliver on our commitment to
world class food safety, achieving our highest ever scores on our independent third-party food safety audits and the lowest number of critical violations in the brands history.
|
|
|
|
| |
■
|
| |
Launched an initiative to improve kitchen production and identified several
solutions for kitchen production automation.
|
|
|
Chris Brandt (IPF: 175%)
|
| |
■
|
| |
Increased our brand relevance and our Cultivate a Better World narrative through
benevolence initiatives, such as our 200,000 burrito giveaway for healthcare workers, commitment of $1.0 million to address racial justice, starting with $500,000 donation to National Urban League, implementation of Round Up for Real
Change feature on the app which raised almost $4.0 million since its mid-year launch, and launch of Real Foodprint on our app, which highlights for consumers how Chipotle ingredients are better for the planet than conventional
ingredients.
|
|
|
|
| |
■
|
| |
Continued to keep our brand on point in culture and created tens of millions of
social media impressions behind initiatives such as Chipotle Together, Chipotle IQ, Tik Tok Timeout, E.L.F. collaboration, Chipotle Goods, sports activations, and the Chipotle egaming series.
|
|
|
|
| |
Target 2020 AIP Payout
|
| |
Actual 2020 AIP Payout
|
| ||||||||||||
|
Name
|
| |
% of Base
Salary
|
| |
Dollar
Value
|
| |
Adjusted
CPF
|
| |
IPF
|
| |
Dollar
Value
|
| |
% of
Target
|
|
|
Brian Niccol
|
| |
180%
|
| |
$ 2,250,000
|
| |
120%
|
| |
200%
|
| |
$ 3,150,000
|
| |
140%
|
|
|
Jack Hartung
|
| |
95%
|
| |
$774,250
|
| |
120%
|
| |
175%
|
| |
$1,035,559
|
| |
134%
|
|
|
Curt Garner
|
| |
80%
|
| |
$ 540,000
|
| |
120%
|
| |
200%
|
| |
$ 756,000
|
| |
140%
|
|
|
Scott Boatwright
|
| |
80%
|
| |
$420,000
|
| |
120%
|
| |
200%
|
| |
$ 588,000
|
| |
140%
|
|
|
Chris Brandt
|
| |
80%
|
| |
$520,000
|
| |
120%
|
| |
175%
|
| |
$ 695,500
|
| |
134%
|
|
(1)
|
The food safety is only a negative modifier and can decrease payouts by as much as -20%. Based on our strong food safety metrics for
2020, the Committee did not apply the negative modifier to reduce any payouts.
|
|
|
|
2021 Proxy Statement 52
|
|
|
|
|
| |
Annual LTI Grant - Total Grant Value
|
| ||||||
|
NEO
|
| |
2020
|
| |
2019
|
| |
% Change
|
|
|
Brian Niccol
|
| |
$ 10,000,000
|
| |
$ 8,000,000
|
| |
25.0%
|
|
|
Jack Hartung
|
| |
$ 3,000,000
|
| |
$ 3,000,000
|
| |
0.0%
|
|
|
Curt Garner
|
| |
$ 3,000,000
|
| |
$ 3,000,000
|
| |
0.0%
|
|
|
Scott Boatwright
|
| |
$2,750,000
|
| |
$2,500,000
|
| |
10.0%
|
|
|
Chris Brandt
|
| |
$2,500,000
|
| |
$2,000,000
|
| |
25.0%
|
|
|
3 Year Average RCF Margin
|
| |
3 Year CRS Growth
|
| |||||||||||||||||||||
|
3.5%
|
| |
4.0%
|
| |
4.5%
|
| |
5.0%
|
| |
5.5%
|
| |
6.0%
|
| |
6.5%
|
| |
7.0%
|
| |||
|
21.5%
|
| |
0%
|
| |
0%
|
| |
50%
|
| |
50%
|
| |
75%
|
| |
100%
|
| |
125%
|
| |
150%
|
|
|
22.0%
|
| |
0%
|
| |
25%
|
| |
75%
|
| |
75%
|
| |
75%
|
| |
125%
|
| |
175%
|
| |
200%
|
|
|
23.0%
|
| |
25%
|
| |
50%
|
| |
75%
|
| |
100%
|
| |
125%
|
| |
175%
|
| |
225%
|
| |
275%
|
|
|
24.0%
|
| |
50%
|
| |
75%
|
| |
100%
|
| |
150%
|
| |
175%
|
| |
250%
|
| |
275%
|
| |
300%
|
|
|
24.5%
|
| |
75%
|
| |
100%
|
| |
125%
|
| |
200%
|
| |
225%
|
| |
250%
|
| |
300%
|
| |
300%
|
|
|
|
|
2021 Proxy Statement 53
|
|
|
|
2 Year Average RCF Margin
|
| |
3 Year CRS Growth
|
| |||||||||||||||||||||
|
3.5%
|
| |
4.0%
|
| |
4.5%
|
| |
5.0%
|
| |
5.5%
|
| |
6.0%
|
| |
6.5%
|
| |
7.0%
|
| |||
|
18.5%
|
| |
0%
|
| |
0%
|
| |
25%
|
| |
50%
|
| |
75%
|
| |
100%
|
| |
125%
|
| |
150%
|
|
|
19.0%
|
| |
0%
|
| |
25%
|
| |
50%
|
| |
75%
|
| |
100%
|
| |
150%
|
| |
150%
|
| |
200%
|
|
|
20.0%
|
| |
50%
|
| |
75%
|
| |
100%
|
| |
150%
|
| |
150%
|
| |
200%
|
| |
200%
|
| |
250%
|
|
|
21.0%
|
| |
75%
|
| |
100%
|
| |
150%
|
| |
200%
|
| |
200%
|
| |
250%
|
| |
250%
|
| |
300%
|
|
|
22.0%
|
| |
75%
|
| |
125%
|
| |
175%
|
| |
225%
|
| |
250%
|
| |
275%
|
| |
300%
|
| |
300%
|
|
|
|
|
2021 Proxy Statement 54
|
|
|
|
|
| |
Shares Earned -
Original 2018-20
PSUs(1)
|
| |
Incremental Shares
Earned – Modified
2018-20 PSU(2)
|
| |
Total Shares
Earned
|
|
|
Brian Niccol
|
| |
9,377
|
| |
16,156
|
| |
25,533
|
|
|
Jack Hartung
|
| |
5,626
|
| |
9,694
|
| |
15,320
|
|
|
Curt Garner
|
| |
5,064
|
| |
8,724
|
| |
13,788
|
|
|
Scott Boatwright
|
| |
3,188
|
| |
5,493
|
| |
8,681
|
|
|
Chris Brandt
|
| |
2,813
|
| |
4,848
|
| |
7,661
|
|
(1)
|
Shares earned under the terms of the original 2018-20 PSU award agreement fully vested and were issued on March 15, 2021.
|
(2)
|
To support further shareholder alignment and retention, the Compensation Committee imposed additional vesting requirements on the
incremental shares earned as a result of the modifications, which shares will vest in 6-month installments over two years, subject to the executive officer’s continued employment with Chipotle,.
|
|
|
|
2021 Proxy Statement 55
|
|
|
|
|
| |
Ownership
Requirement
(multiple of
base salary)
|
| |
Value of Share
Ownership
Towards
Requirement(1)
|
| |
Actual Share
Ownership as
Multiple of
Base Salary(2)
|
|
|
Brian Niccol
|
| |
7 times
|
| |
$77.5 million
|
| |
62x
|
|
|
Jack Hartung
|
| |
4 times
|
| |
$100.2 million
|
| |
118x
|
|
|
Curt Garner
|
| |
3 times
|
| |
$31.9 million
|
| |
44x
|
|
|
Scott Boatwright
|
| |
3 times
|
| |
$23.7 million
|
| |
43x
|
|
|
Chris Brandt
|
| |
3 times
|
| |
$20.7 million
|
| |
31x
|
|
(1)
|
Consists of common stock and unvested RSUs multiplied by the 30-day average price of Chipotle common stock as of March 1, 2021.
|
(2)
|
Based on the NEO’s base salary as of March 1, 2021.
|
|
|
|
2021 Proxy Statement 56
|
|
|
■
|
Our executive compensation program is well-designed to encourage behaviors aligned with the long-term
interests of shareholders, with a significant portion of executive compensation awarded in the form of long-term equity incentives.
|
■
|
There is appropriate balance in the executive compensation program structure to mitigate
compensation-related risk with fixed and variable pay; cash and equity; corporate and individual goals; formulas and discretion; and short-term and long-term measurement
periods.
|
|
|
|
2021 Proxy Statement 57
|
|
|
■
|
We have policies to mitigate compensation risk including stock ownership guidelines, insider trading
prohibitions, discretion to reduce payments, forfeiture provisions, independent Compensation Committee oversight, and going forward, a newly adopted compensation
recoupment and clawback policy.
|
■
|
Compensation Committee oversight extends to incentive plans below the executive officer level, where no
potential material compensation-related risk was identified.
|
|
|
|
2021 Proxy Statement 58
|
|
|
|
|
|
2021 Proxy Statement 59
|
|
|
|
Name and
Principal Position
|
| |
Year
|
| |
Salary ($)
|
| |
Bonus ($)
|
| |
Stock
Awards ($)(l)
|
| |
Option
Awards ($)(2)
|
| |
Non-Equity
Incentive Plan
Compensation
($)(3)
|
| |
All Other
Compensation ($)(4)
|
| |
Total ($)
|
| |
Total Excluding
COVID-Related
Modification(5)
|
|
|
Brian Niccol
Chairman
and Chief Executive Officer
|
| |
2020
|
| |
$1,242,307
|
| |
$—
|
| |
$ 29,222,813
|
| |
$ 4,000,219
|
| |
$3,150,000
|
| |
$420,529
|
| |
$38,035,868
|
| |
$14,813,770
|
|
|
2019
|
| |
$ 1,200,000
|
| |
$—
|
| |
$ 5,700,073
|
| |
$2,731,683
|
| |
$3,870,000
|
| |
$2,566,388
|
| |
$16,068,144
|
| |
|
| |||
|
2018
|
| |
$969,231
|
| |
$ 1,000,000
|
| |
$ 12,650,019
|
| |
$ 15,683,006
|
| |
$2,381,684
|
| |
$ 837,000
|
| |
$ 33,520,940
|
| |
|
| |||
|
Jack Hartung
Chief
Financial Officer
|
| |
2020
|
| |
$812,692
|
| |
—
|
| |
$ 15,733,267
|
| |
$1,200,156
|
| |
$1,035,559
|
| |
$ 220,678
|
| |
$19,002,352
|
| |
$5,069,641
|
|
|
2019
|
| |
$ 800,000
|
| |
$ 1,000,000
|
| |
$ 2,800,210
|
| |
$1,170,844
|
| |
$1,462,000
|
| |
$ 293,547
|
| |
$7,526,601
|
| |
|
| |||
|
2018
|
| |
$ 800,000
|
| |
$—
|
| |
$ 1,800,046
|
| |
$1,231,989
|
| |
$899,747
|
| |
$ 252,447
|
| |
$4,984,230
|
| |
|
| |||
|
Curt Garner
Chief
Technology Officer
|
| |
2020
|
| |
$ 666,538
|
| |
$—
|
| |
$ 14,339,858
|
| |
$1,200,156
|
| |
$756,000
|
| |
$195,108
|
| |
$17,157,660
|
| |
$4,618,359
|
|
|
2019
|
| |
$605,174
|
| |
$—
|
| |
$ 2,800,210
|
| |
$1,170,844
|
| |
$933,100
|
| |
$ 334,307
|
| |
$5,843,636
|
| |
|
| |||
|
2018
|
| |
$518,358
|
| |
$ 500,000
|
| |
$ 3,119,990
|
| |
$ 2,666,469
|
| |
$439,561
|
| |
$ 882,358
|
| |
$8,126,734
|
| |
|
| |||
|
Scott Boatwright
Chief
Restaurant Officer
|
| |
2020
|
| |
$517,307
|
| |
$—
|
| |
$ 9,546,563
|
| |
$1,100,217
|
| |
$588,000
|
| |
$ 159,772
|
| |
$11,911,859
|
| |
$4,015,878
|
|
|
2019
|
| |
$ 468,230
|
| |
$—
|
| |
$ 2,500,083
|
| |
$ 975,589
|
| |
$714,875
|
| |
$ 125,384
|
| |
$4,784,161
|
| |
|
| |||
|
2018
|
| |
$ 427,765
|
| |
$ 400,000
|
| |
$2,219,991
|
| |
$ 1,944,290
|
| |
$352,916
|
| |
$ 366,207
|
| |
$5,711,169
|
| |
|
| |||
|
Chris Brandt
Chief
Marketing Officer
|
| |
2020
|
| |
$ 645,385
|
| |
$—
|
| |
$ 8,469,023
|
| |
$ 1,000,055
|
| |
$695,500
|
| |
$ 122,866
|
| |
$10,932,829
|
| |
$3,964,414
|
|
|
2019
|
| |
$616,923
|
| |
$—
|
| |
$ 2,200,540
|
| |
$ 780,505
|
| |
$933,100
|
| |
$ 110,214
|
| |
$4,641,282
|
| |
|
| |||
|
2018
|
| |
$ 438,462
|
| |
$ 500,000
|
| |
$1,348,567
|
| |
$ 2,082,836
|
| |
$491,306
|
| |
$178,115
|
| |
$5,039,286
|
| |
|
|
(1)
|
Amounts under “Stock Awards” represent the grant date fair value under FASB Topic 718 of the grant of performance share units (PSUs)
for which vesting was considered probable as of the grant date. See Note 8 to our audited consolidated financial statements for the year ended December 31, 2020, which are included in our Annual Report on Form 10-K filed with the SEC on
February 10, 2021 for descriptions of the methodologies and assumptions we use to value stock awards and the manner in which we recognize the related expense pursuant to FASB ASC Topic 718. The 2020 annual PSU awards will not pay out
unless and only to the extent that the performance targets are achieved, which targets are based on three-year comparable restaurant sales growth and average restaurant cash flow margin over the 2020 through 2022 performance period. The
PSU awards reflect an assumed target outcome of the performance conditions and do not reflect the value that ultimately may be realized by the executive officer. The aggregate grant date fair value of the 2020 PSU awards, assuming maximum
performance, is $18,002,142 for Mr. Niccol, $5,401,671 for Messrs. Hartung and Garner, $4,951,746 for Mr. Boatwright and $4,501,821 for Mr. Brandt. For 2020, also includes the incremental fair value of the 2018-20 PSUs due to the
COVID-related modifications approved by our Compensation Committee in December 2020. The 2018-20 PSUs, as modified, would have been earned at 283% of target; however, in early 2021 the Compensation Committee exercised its negative
discretion to cap the payout at 275%. The 2020 Stock Awards column reflects the incremental fair value resulting from the modifications at the 283% payout, even though the actual payout is 275%. For further discussion, see “Compensation
Discussion and Analysis – 2020 Compensation Program – 2020 PSU Awards” and “Compensation Discussion and Analysis – COVID-19 Related Modifications to Incentive Compensation.”
|
(2)
|
Amounts under “Option Awards” represent the grant date fair value under FASB Topic 718 of SOSARs awarded in 2020. See Note 8 to our
audited consolidated financial statements for the year ended December 31, 2020, as referenced in footnote 1, for descriptions of the methodologies and assumptions we use to value SOSAR awards and the manner in which we recognize the
related expense pursuant to FASB ASC Topic 718.
|
(3)
|
Amounts under “Non-Equity Incentive Plan Compensation” represent the amounts earned under the annual incentive plan (AIP) for the
relevant year, which reflect the COVID-related modifications to the 2020 AIP that were approved by our Compensation Committee in December 2020. For further discussion, see “Compensation Discussion and Analysis – COVID-19 Related
Modifications to Incentive Compensation.”
|
(4)
|
Amounts shown in the “All Other Compensation” column for 2020 include the following:
|
|
Name
|
| |
Company
Contributions
to Retirement
Plans(a)
|
| |
Housing/
Mortgage
Allowance(b)
|
| |
Car
Allowance(c)
|
| |
Commuting
Costs(d)
|
| |
Personal
Aircraft
Use(e)
|
| |
Tax
Payments(f)
|
| |
Temporary
Security
Detail(g)
|
| |
Other(h)
|
| |
Total
|
|
|
Brian Niccol
|
| |
$195,977
|
| |
$0
|
| |
$35,100
|
| |
$ 0
|
| |
$ 129,072
|
| |
$ 733
|
| |
$50,031
|
| |
$9,616
|
| |
$ 420,529
|
|
|
Jack Hartung
|
| |
$85,895
|
| |
$68,958
|
| |
$377
|
| |
$13,813
|
| |
$ 22,401
|
| |
$ 22,389
|
| |
$0
|
| |
$6,845
|
| |
$ 220,678
|
|
|
Curt Garner
|
| |
$63,986
|
| |
$ 60,000
|
| |
$35,100
|
| |
$ 0
|
| |
$ 27,675
|
| |
$1,510
|
| |
$0
|
| |
$6,837
|
| |
$195,108
|
|
|
Scott Boatwright
|
| |
$49,287
|
| |
$ 60,000
|
| |
$35,100
|
| |
$ 0
|
| |
$ 0
|
| |
$ 4,550
|
| |
$0
|
| |
$10,835
|
| |
$159,772
|
|
|
Chris Brandt
|
| |
$63,139
|
| |
$0
|
| |
$35,100
|
| |
$ 0
|
| |
$1,973
|
| |
$ 8,326
|
| |
$0
|
| |
$14,328
|
| |
$122,866
|
|
(a)
|
Consists of matching contributions made by the company to Chipotle’s 401(k) Plan and the Supplemental Deferred Investment Plan for the
benefit of the executive. The Supplemental Deferred Investment Plan is a nonqualified deferred compensation arrangement for employees who earn compensation in excess of the maximum compensation that can be taken into account with respect
to the 401(k) Plan, as set by the Internal Revenue Code. See “Non-Qualified Deferred Compensation for 2020” for more details on this plan.
|
|
|
|
2021 Proxy Statement 60
|
|
|
(b)
|
Consists of housing expenses in California for Mr. Hartung who commutes from his home and our company headquarters. For Messrs. Garner
and Boatwright, consists of a mortgage allowance to offset increased housing costs related to their relocation to California, which allowance ends in 2021. The aggregate incremental cost for housing expenses was based on the amount paid
to the service provider or reimbursed to the NEO, as applicable.
|
(c)
|
Consists of costs for a company car used by the executive, including depreciation expense recognized on company-owned cars, or lease
payments on leased cars (in either case less employee payroll deductions), insurance premiums, and maintenance and fuel costs. Also includes car allowances paid to executives who choose not to use a company car.
|
(d)
|
Consists of commuting costs, including airfare, airport parking and ground transportation, for travel from Mr. Hartung’s home to our
company headquarters in California.
|
(e)
|
Consists of the aggregate incremental costs of personal use of company-owned aircraft by the indicated NEO. Our Board approved a
limited amount of personal aircraft use for Mr. Niccol and, in light of COVID-19, Mr. Niccol approved limited personal aircraft use for the other NEOs. The aggregate incremental costs include costs billed by the applicable third-party or,
for company-owned aircraft, the hourly operating cost of the aircraft, consisting of fuel costs, an allocation of maintenance costs and other operating costs such as crew expenses, catering, landing fees, taxes and other operating costs.
|
(f)
|
Consists of the company’s reimbursement of taxes payable by the executive in connection with commuting costs for Mr. Hartung,
financial and tax counseling for Messrs. Boatwright and Brandt and other perquisites that are not required to be itemized in the table above that are taxable to the executives under Internal Revenue Service rules.
|
(g)
|
Consists of expenses for a temporary security detail for several weeks during the summer of 2020, which was approved by our
Compensation Committee.
|
(h)
|
Consists of gym allowance, financial and tax counseling, life insurance premiums, home security and a background check for a household
employee.
|
(5)
|
Represents total 2020 compensation excluding the COVID-related modifications to the 2018-20 PSUs, which is included in the “Stock
Awards” column. The original grant date fair value of the 2018-20 PSUs was previously disclosed as compensation for fiscal year 2018. See “Compensation Discussion and Analysis – COVID-19 Related Modifications to Incentive Compensation”
for more details regarding these modifications. The amounts reported in this column provide supplemental information and should not be viewed as a substitute for the “Total” column calculated in accordance with the SEC executive
compensation disclosure rules.
|
|
|
|
2021 Proxy Statement 61
|
|
|
|
|
| |
|
| |
|
| |
Estimated Possible Payouts
Under Non- Equity Incentive
Plan Awards(l)
|
| |
Estimated Possible Payouts
Under Equity Incentive
Plan Awards(2)
|
| |
All Other
Stock
Awards:
Number of
Shares of
Stock
or Units (#)
|
| |
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)(2)
|
| |
Exercise
or Base
Price of
Option
Awards
($/Sh)
|
| |
Grant
Date Fair
Value
of Stock
and
Option
Awards
($)(3)
|
| ||||||||||||
|
Name
|
| |
Award
Type
|
| |
Grant
Date
|
| |
Threshold
($)
|
| |
Target
($)
|
| |
Maximum
($)
|
| |
Threshold
(#)
|
| |
Target
(#)
|
| |
Maximum
(#)
|
| ||||||||||||
|
Brian Niccol
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
AIP
|
| |
—
|
| |
$1,125,000
|
| |
$2,250,000
|
| |
$6,187,500
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
PSUs(4)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
1,751
|
| |
7,002
|
| |
21,006
|
| |
|
| |
|
| |
|
| |
$6,000,714
|
|
|
|
| |
SOSARs(5)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
17,812
|
| |
$857.00
|
| |
$4,000,219
|
|
|
|
| |
PSUs(6)
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
| |
16,899
|
| |
|
| |
|
| |
|
| |
|
| |
$23,222,099
|
|
|
Jack Hartung
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
AIP
|
| |
—
|
| |
$387,125
|
| |
$774,250
|
| |
$2,129,188
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
PSUs(4)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
525
|
| |
2,101
|
| |
6,303
|
| |
|
| |
|
| |
|
| |
$1,800,557
|
|
|
|
| |
SOSARs(5)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
5,344
|
| |
$857.00
|
| |
$1,200,156
|
|
|
|
| |
PSUs(6)
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
| |
10,139
|
| |
|
| |
|
| |
|
| |
|
| |
$13,932,710
|
|
|
Curt Garner
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
AIP
|
| |
—
|
| |
$270,000
|
| |
$540,000
|
| |
$1,485,000
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
PSUs(4)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
525
|
| |
2,101
|
| |
6,303
|
| |
|
| |
|
| |
|
| |
$1,800,557
|
|
|
|
| |
SOSARs(5)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
5,344
|
| |
$857.00
|
| |
$1,200,156
|
|
|
|
| |
PSUs(6)
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
| |
9,125
|
| |
|
| |
|
| |
|
| |
|
| |
$12,539,301
|
|
|
Scott Boatwright
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
AIP
|
| |
—
|
| |
$210,000
|
| |
$420,000
|
| |
$1,155,000
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
PSUs(4)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
482
|
| |
1,926
|
| |
5,778
|
| |
|
| |
|
| |
|
| |
$1,650,582
|
|
|
|
| |
SOSARs(5)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
4,899
|
| |
$857.00
|
| |
$1,100,217
|
|
|
|
| |
PSUs(6)
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
| |
5,746
|
| |
|
| |
|
| |
|
| |
|
| |
$7,895,981
|
|
|
Chris Brandt
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
AIP
|
| |
—
|
| |
$260,000
|
| |
$520,000
|
| |
$1,430,000
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
PSUs(4)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
438
|
| |
1,751
|
| |
5,253
|
| |
|
| |
|
| |
|
| |
$1,500,607
|
|
|
|
| |
SOSARs(5)
|
| |
2/6/20
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
4,453
|
| |
$857.00
|
| |
$1,000,055
|
|
|
|
| |
PSUs(6)
|
| |
(6)
|
| |
|
| |
|
| |
|
| |
|
| |
5,071
|
| |
|
| |
|
| |
|
| |
|
| |
$6,968,416
|
|
(1)
|
Each executive officer was entitled to a cash award to be paid under our 2014 Cash Incentive Plan. The “Threshold” column reflects
amounts that would be paid under the AIP if each executive officer achieved the plan goals at the minimum level required to receive any payout. The “Target” column reflects amounts that would be paid under the AIP if the company
performance factor and the individual performance factor under the AIP were each achieved at 100 percent. The “Maximum” column reflects amounts that would be paid under the AIP if the company performance factor and individual performance
factor were each achieved at the maximum level. Amounts in each column assume that the Compensation Committee does not utilize the food safety modifier to decrease the payout to any NEO by up to -20%. Actual AIP bonuses paid are reflected
in the “Non-Equity Incentive Plan Compensation” column of the 2020 Summary Compensation Table above. See “Compensation Discussion and Analysis – 2020 Compensation Program – Annual Incentive Plan” for further information regarding the AIP.
|
(2)
|
All equity awards are shown in shares of common stock and were granted under the Amended and Restated Chipotle Mexican Grill, Inc.
2011 Stock Incentive Plan. See “Terms of 2020 Annual Performance Share Unit Awards” and “Terms of 2020 Annual SOSAR Awards” below for a description of the vesting terms for the PSUs and SOSARs granted during 2020.
|
(3)
|
See Note 8 to our audited consolidated financial statements for the year ended December 31, 2020, which are included in our Annual
Report on Form 10-K filed with the SEC on February 10, 2021, for descriptions of the methodologies and assumptions we used to value equity awards pursuant to FASB Topic 718.
|
(4)
|
PSUs will vest to the extent that the two performance goals – the company’s comparable restaurant sales growth and restaurant cash
flow margin over the three-year period from January 1, 2020 – December 2022 – are achieved.
|
(5)
|
SOSAR awards vests 50% on the second anniversary and 50% on the third anniversary of the date of grant.
|
(6)
|
Represents the incremental fair value resulting from the COVID-related modifications to the 2018-20 PSUs, which were approved by our
Compensation Committee in December 2020. As a result of these modifications, each NEO would have earned the following incremental shares under the 2018-20 PSUs based on a payout level of 283% of target: Mr. Niccol (16,899), Mr. Hartung
(10,139), Mr. Garner (9,125), Mr. Boatwright (5,746) and Mr. Brandt (5,071). In early 2021, the Compensation Committee capped the maximum shares that could be earned under the 2018-20 PSUs to 275% of target, and the incremental shares
earned by each NEO was reduced to: Mr. Niccol (16,156), Mr. Hartung (9,694), Mr. Garner (8,724), Mr. Boatwright (5,493) and Mr. Brandt (4,848). These incremental shares will vest one-third on June 30, 2021, one-third on December 31, 2021,
one-sixth on June 30, 2022 and one-sixth on December 31, 2022, in each case subject to the officer’s continued employment with us through such dates. These incremental shares also are subject to potential acceleration of vesting in the
event of employment termination due to death or continued vesting upon employment termination due to disability or retirement. Mr. Hartung is the only executive who is eligible for retirement treatment as of December 31, 2020. For further
discussion, see “Compensation Discussion and Analysis – 2020 Compensation Program – 2020 PSU Awards” and “Compensation Discussion and Analysis – COVID-19 Related Modifications to Incentive Compensation.”
|
|
|
|
2021 Proxy Statement 62
|
|
|
|
|
|
2021 Proxy Statement 63
|
|
|
|
|
| |
Option Awards(1)
|
| |
Stock Awards
|
| ||||||||||||||||||
|
Name
|
| |
Number of
Securities
Underlying
Unexercised
Options(#)
Exercisable
|
| |
Number of
Securities
Underlying
Unexercised
Options(#)
Unexercisable
|
| |
Option
Exercise
Price
($)
|
| |
Option
Expiration
Date
|
| |
Number
of
Shares or
Units of
Stock
that
Have Not
Vested
(#)(1)
|
| |
Market
Value of
Shares or
Units of
Stock That
Have Not
Vested
($)(2)
|
| |
Equity Incentive
Plan Awards:
Number of
Unearned
Shares, Units
or Other Rights
That Have Not
Vested (#)(3)
|
| |
Equity Incentive
Plan Awards:
Market or
Payout Value
of Unearned
Shares, Units
of Other Rights
That Have Not
Vested($)(2)
|
|
|
Brian Niccol
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
—
|
| |
38,280(4)
|
| |
$352.18
|
| |
3/25/2025
|
| |
26,276(5)
|
| |
—
|
| |
—
|
| |
$36,437,192
|
|
|
|
| |
—
|
| |
17,695(4)
|
| |
$400.20
|
| |
3/5/2025
|
| |
10,047(4)
|
| |
$13,932,275
|
| |
—
|
| |
—
|
|
|
|
| |
—
|
| |
10,719
|
| |
$323.11
|
| |
3/29/2025
|
| |
—
|
| |
—
|
| |
7,722(6)
|
| |
$10,708,175
|
|
|
|
| |
—
|
| |
15,823
|
| |
$582.77
|
| |
2/8/2026
|
| |
—
|
| |
—
|
| |
7,207
|
| |
$9,994,019
|
|
|
|
| |
—
|
| |
17,812
|
| |
$857.00
|
| |
2/6/2027
|
| |
—
|
| |
—
|
| |
1,751
|
| |
$2,427,436
|
|
|
Jack Hartung
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
7, 371
|
| |
7, 371
|
| |
$355.42
|
| |
3/29/2025
|
| |
19,815(5)
|
| |
—
|
| |
—
|
| |
$27,477,659
|
|
|
|
| |
—
|
| |
6,782
|
| |
$582.77
|
| |
2/8/2026
|
| |
—
|
| |
—
|
| |
5, 148(6)
|
| |
$7, 138,783
|
|
|
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
3,089
|
| |
$4,283,547
|
|
|
|
| |
—
|
| |
5, 344
|
| |
$857.00
|
| |
2/6/2027
|
| |
—
|
| |
—
|
| |
525
|
| |
$728,369
|
|
|
Curt Garner
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
9, 193
|
| |
9, 193
|
| |
$313.79
|
| |
1/5/2025
|
| |
14, 189(5)
|
| |
—
|
| |
—
|
| |
$19,676,028
|
|
|
|
| |
—
|
| |
6,782
|
| |
$582.77
|
| |
2/8/2026
|
| |
2, 390
|
| |
$3, 314,237
|
| |
—
|
| |
—
|
|
|
|
| |
—
|
| |
—
|
| |
$427.61
|
| |
2/19/2024
|
| |
—
|
| |
—
|
| |
5, 148(6)
|
| |
$7, 138,783
|
|
|
|
| |
6,634
|
| |
6,634
|
| |
$355.42
|
| |
3/29/2025
|
| |
—
|
| |
—
|
| |
3,089
|
| |
$4,283,547
|
|
|
|
| |
—
|
| |
5, 344
|
| |
$857.00
|
| |
2/6/2027
|
| |
—
|
| |
—
|
| |
525
|
| |
$728,369
|
|
|
Scott Boatwright
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
—
|
| |
7, 354
|
| |
$313.79
|
| |
1/5/2025
|
| |
8,934(5)
|
| |
—
|
| |
—
|
| |
$12, 388,867
|
|
|
|
| |
—
|
| |
4, 177
|
| |
$355.42
|
| |
3/29/2025
|
| |
1,912
|
| |
$2,651 , 390
|
| |
—
|
| |
—
|
|
|
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
5, 148(6)
|
| |
$7, 138,783
|
|
|
|
| |
—
|
| |
5,651
|
| |
$582.77
|
| |
2/8/2026
|
| |
—
|
| |
—
|
| |
2,574
|
| |
$3,569,392
|
|
|
|
| |
—
|
| |
4,899
|
| |
$857.00
|
| |
2/6/2027
|
| |
—
|
| |
—
|
| |
482
|
| |
$667,701
|
|
|
Chris Brandt
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
|
|
| |
—
|
| |
11,283
|
| |
$403.89
|
| |
3/29/2025
|
| |
7,884(5)
|
| |
—
|
| |
—
|
| |
$10,932,822
|
|
|
|
| |
—
|
| |
3,686
|
| |
$355.42
|
| |
3/29/2025
|
| |
774(4)
|
| |
$1, 073, 314
|
| |
—
|
| |
—
|
|
|
|
| |
—
|
| |
4, 521
|
| |
$582.77
|
| |
2/8/2026
|
| |
—
|
| |
—
|
| |
5, 148(6)
|
| |
$7, 138,783
|
|
|
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
—
|
| |
2,060
|
| |
$2,856,623
|
|
|
|
| |
—
|
| |
4,453
|
| |
$857.00
|
| |
2/6/2027
|
| |
—
|
| |
—
|
| |
438
|
| |
$607,032
|
|
(1)
|
Unless otherwise indicated, SOSARs and RSUs vest ratably on the second and third anniversary of the grant date.
|
(2)
|
Calculated based on the closing stock price of our common stock on December 31, 2020 of $1,386.71 per share.
|
(3)
|
Unless otherwise indicated, PSUs vest if and to the extent that the performance targets are met at the end of the three-year
performance period. The number of shares in the table reflect (i) achievement of the performance objectives for the 2018-20 PSUs at 283%; (ii) maximum achievement of the performance objectives for the transformation PSUs granted in
February 2019, which PSUs are subject to service-based vesting until February 2023; (iii) target achievement of the performance objectives for the 2019-21 PSUs, based on cumulative performance through December 31, 2020; and (iv) threshold
achievement of the performance objectives for the 2020-22 PSUs, based on cumulative performance through December 31, 2020.
|
(4)
|
Represents grants of SOSARs and RSUs awarded as make-whole or inducement awards when the executives joined Chipotle in early 2018.
The SOSARs granted to Mr. Niccol have an exercise price equal to 110% and 125% of the closing stock price of Chipotle common stock on the grant date and vest ratably over three years beginning on the first anniversary of the grant date.
The SOSAR granted to Mr. Brandt has an exercise price equal to 125% of the closing stock price of Chipotle common stock on the grant date and his awards vest ratably on the second and third anniversary of the grant date.
|
(5)
|
Represents shares earned under the 2018-20 PSUs, including incremental shares earned as a result of the COVID-related modifications
that were approved by our Compensation Committee in December 2020. As a result of these modifications, each NEO earned the following incremental shares under the 2018-2020 PSUs based on a payout level of 283% of target: Mr. Niccol
(16,899), Mr. Hartung (10,139), Mr. Garner (9,125), Mr. Boatwright (5,746) and Mr. Brandt (5,071). In early 2021, the Compensation Committee capped the maximum number of shares that could be earned at 275% of target and the incremental
shares earned by each NEO were reduced to: Mr. Niccol (16,156), Mr. Hartung
|
|
|
|
2021 Proxy Statement 64
|
|
|
(6)
|
Represents the Transformation PSUs and reflects the achievement of all three performance objectives by the end of 2020, and the
resulting 300% earnout. The Transformation PSUs will vest 40% on February 8, 2022 and 60% on February 8, 2023, in each case subject to the NEO's continued employment with Chipotle through such dates. The terms of the transformation PSUs
are described above under “Earnout of Prior Years LTI Awards – 2019 Transformation Performance Shares.”
|
|
|
| |
Option Awards
|
| |
Stock awards
|
| ||||||
|
Name
|
| |
Number of
Shares
Acquired
on Exercise(#)(1)
|
| |
Value Realized
on Exercise($)(2)
|
| |
Number of
Shares
Acquired
on Vesting(#)(1)
|
| |
Value Realized
on Vesting($)(3)
|
|
|
Brian Niccol
|
| |
95,796
|
| |
$ 48,982,738
|
| |
10,047
|
| |
$7,309,695
|
|
|
Jack Hartung
|
| |
30,000
|
| |
$ 10,779,547
|
| |
22,006
|
| |
$18,645,464
|
|
|
Curt Garner
|
| |
30,000
|
| |
$ 14,226,292
|
| |
2,390
|
| |
$2,067,661
|
|
|
Scott Boatwright
|
| |
16,577
|
| |
$9,108,143
|
| |
1,912
|
| |
$1,654,129
|
|
|
Chris Brandt
|
| |
14,970
|
| |
$ 6,828,092
|
| |
774
|
| |
$491,513
|
|
(1)
|
Reflects the number of shares of Chipotle common stock acquired on exercise of SOSARs or the vesting of RSUs.
|
(2)
|
Equals the number of underlying shares exercised multiplied by the difference between the closing price of Chipotle common stock on
the exercise date and the base price of the SOSARs.
|
(3)
|
Equals the closing price the Chipotle’s common stock on the vesting date multiplied by the number of shares vested.
|
|
|
|
2021 Proxy Statement 65
|
|
|
|
Name
|
| |
Executive
Contributions
In Last FY($)(1)
|
| |
Registrant
Contributions
In Last FY($)(2)
|
| |
Aggregate
Earnings
In Last FY($)(3)
|
| |
Aggregate
Withdrawals/
Distributions($)
|
| |
Aggregate
Balance
at Last FYE($)(4)
|
|
|
Brian Niccol
|
| |
$ 257,462
|
| |
$ 193,092
|
| |
$152,822
|
| |
$0
|
| |
$ 887,229
|
|
|
Jack Hartung
|
| |
$752,123
|
| |
$ 79,588
|
| |
$ 37,652
|
| |
$0
|
| |
$ 8,218,496
|
|
|
Curt Garner
|
| |
$ 507,502
|
| |
$ 52,586
|
| |
$ 197,804
|
| |
$0
|
| |
$1,245,717
|
|
|
Scott Boatwright
|
| |
$ 99,808
|
| |
$ 37,887
|
| |
$16,543
|
| |
$0
|
| |
$ 116,309
|
|
|
Chris Brandt
|
| |
$79,878
|
| |
$51,739
|
| |
$ 30,047
|
| |
($8,348)
|
| |
$ 196,432
|
|
(1)
|
These amounts are reported in the 2020 Summary Compensation Table in each executive’s “Salary” for 2020.
|
(2)
|
These amounts are reported in the 2020 Summary Compensation Table in each executive’s “All Other Compensation” for 2020.
|
(3)
|
These amounts are not reported as compensation in the 2020 Summary Compensation Table because none of the earnings are “above market”
as defined in SEC rules.
|
(4)
|
These amounts include amounts previously reported in the Summary Compensation Table for years prior to 2020 as “Salary,” “Non-Equity
Incentive Plan Compensation” or “All Other Compensation” (excluding for purposes of this footnote any investment losses on balances in the plan and any withdrawals/distributions), in the following aggregate amounts: Mr. Niccol ($139,752);
Mr. Hartung ($5,750,152); Mr. Garner ($59,996); and Mr. Brandt ($28,989).
|
|
|
|
2021 Proxy Statement 66
|
|
|
|
|
|
2021 Proxy Statement 67
|
|
|
■
|
each triggering event occurred on December 31, 2020, the last trading day of fiscal 2020, and the price
of our common stock was $1,386.71 per share, the closing price of Chipotle common stock on December 31, 2020;
|
■
|
the executive earned a payout under the 2020 AIP equal to the actual payout amount for 2020, since he
was employed by the company through the end of the year; and
|
■
|
with respect to equity awards, the PSUs reflect actual projected performance as of December 31, 2020,
which equal (i) for the 2018-20 PSUs, payout at 101% for the unmodified portion of the award, which is included in the
“Annual Equity Grants” line and payout at 182% for the modified portion of the award, which is included in the “One-Time Equity Grant” line; (ii) for the 2019-21 PSUs, payout at 260% (iii) for the 2019 transformation PSUs, payout at maximum performance, and (iv) for the 2020-22 PSUs, payout at 114%. The incremental shares granted as a result of the
COVID-related modifications to the 2018 PSUs, which were approved by our Compensation Committee in December 2020, are included in the “One-time Equity Grant” line at an incremental 182% payout; however, in early 2021, the Compensation Committee capped the number of PSUs that
could vest at an incremental 174% of target and incremental shares granted to each NEO was reduced. These incremental PSU
shares will vest one-third on June 30, 2021, one-third on December 31, 2021, one-sixth on June 30, 2022 and one-sixth on December 31, 2022, in each case subject
to the officer’s continued employment with us through such dates. For further discussion, see “Compensation Discussion and Analysis – 2020 Compensation Program – 2020 PSU Awards” and “Compensation
Discussion and Analysis – COVID-19 Related Modifications to Incentive Compensation.”
|
|
|
|
2021 Proxy Statement 68
|
|
|
|
Officer
|
| |
Termination Without
Cause or by Executive
for Good Reason
|
| |
Change in Control
(Double Trigger)(l)
|
| |
Retirement(2)
|
| |
Death
or Disability
|
|
|
Brian Niccol
|
| |
|
| |
|
| |
|
| |
|
|
|
Salary(3)
|
| |
$ 2,500,000
|
| |
$ 2,500,000
|
| |
$ 0
|
| |
$ 0
|
|
|
Bonus(3)
|
| |
$ 6,300,000
|
| |
$ 7,650,000
|
| |
$ 0
|
| |
$ 0
|
|
|
One-time Equity Grant(4)
|
| |
$ 94,424,391
|
| |
$ 91,200,290
|
| |
$ 0
|
| |
$ 100,171,327
|
|
|
Annual Equity Grants
|
| |
$ 11,400,728
|
| |
$83,614,581
|
| |
$ 0
|
| |
$ 74,641,710
|
|
|
Benefits
|
| |
$ 0
|
| |
$ 20,081
|
| |
$ 0
|
| |
$ 0
|
|
|
Jack Hartung
|
| |
|
| |
|
| |
|
| |
|
|
|
Salary
|
| |
$ 0
|
| |
$ 1,630,000
|
| |
$ 0
|
| |
$ 0
|
|
|
Bonus
|
| |
$ 0
|
| |
$ 2,584,059
|
| |
$ 0
|
| |
$ 0
|
|
|
One-time Equity Grant(4)
|
| |
$ 14,059,853
|
| |
$ 21,198,636
|
| |
$17,891,144
|
| |
$17,891,144
|
|
|
Annual Equity Grants
|
| |
$ 0
|
| |
$ 38,145,932
|
| |
$ 33,693,275
|
| |
$ 34,300,061
|
|
|
Benefits
|
| |
$ 0
|
| |
$13,571
|
| |
$0
|
| |
$0
|
|
|
Curt Garner
|
| |
|
| |
|
| |
|
| |
|
|
|
Salary
|
| |
$ 0
|
| |
$ 1,350,000
|
| |
$0
|
| |
$0
|
|
|
Bonus
|
| |
$ 0
|
| |
$ 1,836,000
|
| |
$0
|
| |
$0
|
|
|
One-time Equity Grant(4)
|
| |
$25,831,319
|
| |
$ 32,970,102
|
| |
$0
|
| |
$ 16,485,020
|
|
|
Annual Equity Grants
|
| |
$ 0
|
| |
$ 36,605,750
|
| |
$0
|
| |
$ 32,759,878
|
|
|
Benefits
|
| |
$ 0
|
| |
$ 20,081
|
| |
$0
|
| |
$0
|
|
|
Scott Boatwright
|
| |
|
| |
|
| |
|
| |
|
|
|
Salary
|
| |
$ 0
|
| |
$ 1,050,000
|
| |
$0
|
| |
$0
|
|
|
Bonus
|
| |
$ 0
|
| |
$ 1,428,000
|
| |
$0
|
| |
$0
|
|
|
One-time Equity Grant(4)
|
| |
$ 18,509,679
|
| |
$ 25,648,462
|
| |
$0
|
| |
$11,799,327
|
|
|
Annual Equity Grants
|
| |
$0
|
| |
$ 28,192,568
|
| |
$0
|
| |
$ 24,987,883
|
|
|
Benefits
|
| |
$0
|
| |
$19,789
|
| |
$0
|
| |
$0
|
|
|
Chris Brandt
|
| |
|
| |
|
| |
|
| |
|
|
|
SaIary(5)
|
| |
$ 650,000
|
| |
$ 1,300,000
|
| |
$0
|
| |
$0
|
|
|
Bonus(5)
|
| |
$ 520,000
|
| |
$1,735,500
|
| |
$0
|
| |
$0
|
|
|
One-time Equity Grant(4)
|
| |
$ 7,032,006
|
| |
$26,333,261
|
| |
$0
|
| |
$ 23,025,769
|
|
|
Annual Equity Grants
|
| |
$0
|
| |
$ 23,892,040
|
| |
$0
|
| |
$21,327,296
|
|
|
Benefits
|
| |
$0
|
| |
$20,081
|
| |
$0
|
| |
$0
|
|
(1)
|
Reflects amounts the executive may receive if both a change in control of Chipotle occurs and the executive’s employment is terminated
(other than for cause or by the executive for good reason). If a successor company grants the executive comparable equity awards in replacement of the outstanding Chipotle awards, no accelerated vesting would occur.
|
(2)
|
Retirement is defined as the executive having achieved a combined age and years of service equal to at least 70. Mr. Hartung is the
only executive who is eligible for retirement treatment as of December 31, 2020.
|
(3)
|
Mr. Niccol’s offer letter provides that if his employment is terminated prior to March 5, 2023 by Chipotle without cause, or by him
with good reason, he would be entitled to severance payments equal to two-times the sum of his base salary plus his target bonus opportunity (or, if higher, his bonus payout for the immediately preceding fiscal year).
|
(4)
|
Represents new hire and retention equity awards for Messrs. Niccol and Brandt and the 2019 transformation PSUs for all NEOs. Also
reflects the incremental shares earned under the 2018-2020 PSUs due to the COVID-related modifications at 182% of target. In early 2021, the Compensation Committee exercised its negative discretion to cap the payout at 275%. For further
details, see “Compensation Discussion and Analysis – COVID-19 Related Modifications to Incentive Compensation.” Value is calculated based on the closing stock price of Chipotle common stock on December 31, 2020 of $1,386.71 per share.
|
(5)
|
Mr. Brandt’s offer letter provides that if his employment is terminated prior to March 9, 2023 by Chipotle without cause, or by him
with good reason, Mr. Brandt would be entitled to severance payments equal to the sum of his base salary plus his target bonus opportunity.
|
|
|
|
2021 Proxy Statement 69
|
|
|
|
|
|
2021 Proxy Statement 70
|
|
|
|
|
|
2021 Proxy Statement 71
|
|
|
|
|
|
2021 Proxy Statement 72
|
|
|
|
|
|
2021 Proxy Statement 73
|
|
|
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