Chipotle 2012 Annual Report Download - page 124

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Agreements with Sequence LLC
Mark Crumpacker, our Chief Marketing Officer, served as Creative Director for Sequence, LLC, a strategic
design and marketing consulting firm he co-founded in 2002, prior to joining us in January 2009. Sequence
provided us with a variety of marketing consulting services during 2011 under a master services agreement, and
we expect to continue to work with Sequence during 2013. Sequence has issued Mr. Crumpacker a promissory
note in connection with his separation from them, has agreed to license certain intellectual property from him,
and he also retained a call right to purchase a minority interest in Sequence at any time prior to 2013, which is
now expired. We paid Sequence a total of $299,389 in fees during 2012, and in 2013 Sequence has billed us a
total of $129,408 in fees through March 22.
Registration Rights
Prior to our initial public offering, certain of our current shareholders, including Steve Ells, our Chairman
and Co-Chief Executive Officer, Monty Moran, our Co-Chief Executive Officer and member of our Board of
Directors, and Albert S. Baldocchi and Darlene J. Friedman, members of our Board, entered into a registration
rights agreement with us relating to shares of common stock they held at the time the agreement was executed.
Under the agreement, these directors are entitled to piggyback registration rights with respect to registration
statements we file under the Securities Act of 1933, as amended, subject to customary restrictions and pro rata
reductions in the number of shares to be sold in an offering. We would be responsible for the expenses of any
such registration.
Director and Officer Indemnification
We have entered into agreements to indemnify our directors and executive officers, in addition to the
indemnification provided for in our certificate of incorporation and bylaws. These agreements, among other
things, provide for indemnification of our directors and executive officers for certain expenses (including
attorneys’ fees), judgments, fines and settlement amounts incurred by any such person in any action or
proceeding, including any action by or in the right of our company, arising out of such person’s services as a
director or executive officer of ours, any subsidiary of ours or any other company or enterprise to which the
person provided services at our request. We believe that these provisions and agreements are necessary to attract
and retain qualified persons as directors and executive officers.
54
Proxy Statement