Chipotle 2013 Annual Report Download - page 100

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issuance under the plan as of that date. Shares issued with respect to Full Value Awards are counted as two
shares for every share that is actually issued. For example, if 100 shares are issued with respect to a restricted
stock unit award granted under this plan, 200 shares will be counted against the share reserve. A share subject to
a stock option or stock appreciation right issued under the 2011 Stock Incentive Plan only counts as one share
against the share reserve.
Share Counting Rules
The following rules apply for counting shares against the applicable share limits of the Stock Incentive Plan:
• To the extent that an equity award is settled in cash or a form other than shares, the shares that would
have been delivered had there been no such cash or other settlement will not be counted against the
shares available for issuance under the 2011 Stock Incentive Plan.
• To the extent that shares are delivered pursuant to the exercise of a stock appreciation right or stock
option, the number of underlying shares to which the exercise related shall be counted against the
applicable share limits, as opposed to the number of shares actually issued. For example, if a stock
option relates to 1,000 shares and is exercised at a time when the payment due to the participant is 150
shares, 1,000 shares shall nevertheless be the net charge against the applicable share limit.
• Except as otherwise provided below, shares that are subject to awards that expire or for any reason are
cancelled or terminated, are forfeited, fail to vest, or for any other reason are not paid or delivered
under the 2011 Stock Incentive Plan will again be available for subsequent awards under the 2011
Stock Incentive Plan. Any such shares subject to Full Value Awards will become available taking into
account the two to one share counting rule, discussed above, for these types of awards. For example, if
a 100 share restricted stock unit award is made under the Stock Incentive Plan, the award would count
as 200 shares against the Stock Incentive Plan’s share limit after giving effect to the two to one share
counting rule. If the award is later forfeited before it vests, the 200 shares that were originally counted
against the 2011 Stock Incentive Plan’s share limit would again be available for subsequent awards
under the 2011 Stock Incentive Plan.
• If this proposal is approved, shares that are withheld to satisfy the tax withholding obligations related
to any Full Value Award will be available for subsequent awards under the 2011 Stock Incentive Plan.
Without the amendments being proposed, the plan does not permit shares withheld by Chipotle to
satisfy tax withholding obligations related to a Full Value Award to be available for subsequent
awards. Any such shares will become available taking into account the share counting rule, discussed
above, for Full Value Awards. For example, if a 100 share restricted stock unit award is made under the
Stock Incentive Plan, the award would count as 200 shares against the Stock Incentive Plan’s share
limit after giving effect to the two to one share counting rule. If Chipotle delivers 60 shares to the
participant and withholds 40 shares to cover tax withholding obligations, 80 shares (the 40 that were
withheld multiplied by two to give effect to the two to one share counting rule) would again be
available for subsequent awards under the plan.
• Shares that are exchanged by a participant or withheld by Chipotle to pay the exercise price of an
option or stock appreciation right granted under the 2011 Stock Incentive Plan, as well as any shares
exchanged or withheld to satisfy the tax withholding obligations related to any option or stock
appreciation right, will not be available for subsequent awards under the plan.
• Chipotle may not increase the applicable share limits of the 2011 Stock Incentive Plan by repurchasing
shares of our common stock on the market (by using cash received through the exercise of stock
options or otherwise).
• Shares issued in connection with awards that are granted by or become obligations of Chipotle through
the assumption of awards (or in substitution for awards) in connection with an acquisition of another
company will not count against the shares available for issuance under the 2011 Stock Incentive Plan,
28
Proxy Statement