Chipotle 2013 Annual Report Download - page 151

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assigned, hypothecated, transferred, or disposed of, on a general or specific basis, subject to such conditions and
limitations as the Committee may determine, except that Options may not be sold for consideration or transferred
for value (provided further that transfers described in Section A.1.(a)(5) of the general instructions to Form S-8
shall not be deemed transfers for value for purposes of this section).
(5) If the exercise of the Option following the termination of the Participant’s employment or service
(other than upon the Participant’s death or disability) would be prohibited at any time solely because the issuance
of shares of Common Stock would violate the registration requirements under the Securities Act, or any other
requirements of applicable law, then the Option shall terminate on the earlier of (i) the expiration of the term of
the Option and (ii) the expiration of a period of 30 days after the termination of the Participant’s employment or
service during which the exercise of the Option would not be in violation of such registration requirements or
other applicable requirements.
(6) Notwithstanding the foregoing, the Committee may, in its sole discretion, implement a provision in
existing and future grants of Options and stock appreciation rights providing that if, on the last day that an Option
or stock appreciation right may be exercised, the Participant has not then exercised such Option, such Option
shall be deemed to have been exercised by the Participant on such last day and the Company shall make the
appropriate payment to such Participant after applying minimum required tax withholding. The Committee may
delegate this authority to one or more of the Company’s officers, who may implement this provision by including
it in grant agreements or including it in the Plan’s administrative rules, provided that such officers may not
implement it in Incentive Awards to persons (i) who are Directors or otherwise subject to Section 16 of the
Exchange Act or (ii) who are, or are reasonably expected to be, individuals the deductibility of whose
compensation is limited by Section 162(m) of the Code.
(c) Effect of Termination of Employment or other Relationship
The agreement evidencing the award of each Option shall specify the consequences with respect to such
Option of the termination of the employment, service as a director or other relationship between the Company
and the Participant holding the Option, subject to the restrictions set forth in Section 4, provided, however, that
except as expressly provided to the contrary in the agreement evidencing the award of a particular Option, where
continued vesting or exercisability of an Option terminates in connection with the termination of a Participant’s
employment relationship with the Company, such Participant’s employment relationship with the Company will
be deemed, for purposes of such Option, to continue so long as Participant serves as either an employee of the
Company or as a member of the Board. Notwithstanding the foregoing sentence, a Participant’s employment will
be deemed to terminate immediately upon such Participant’s termination for Cause, regardless of whether
Participant remains on the Board following such termination.
(d) Effect of Qualifying Termination
If a Participant experiences a Qualifying Termination or a Director’s service on the Board terminates in
connection with or as a result of a Change in Control, each Option outstanding immediately prior to such
Qualifying Termination or termination of a Director’s service shall become fully and immediately vested and
exercisable as of such Qualifying Termination or termination of a Director’s service and shall remain exercisable
until its expiration, termination or cancellation pursuant to the terms of the Plan and the agreement evidencing
such Option.
(e) Special Rules for Incentive Stock Options
(1) The aggregate Fair Market Value of shares of Common Stock with respect to which “incentive
stock options” (within the meaning of Section 422 of the Code) are exercisable for the first time by a Participant
during any calendar year under the Plan and any other stock option plan of the Company (or any “subsidiary” as
such term is defined in Section 424 of the Code of Chipotle) shall not exceed $100,000. Such Fair Market Value
A-9
Proxy Statement