CHIPOTLE MEXICAN GRILL, INC. (NYSE:CMG) Files An 8-K Entry into a Material Definitive Agreement
Item1.01.Entry Into a Material Definitive Agreement.
On December 14, 2016, Chipotle Mexican Grill, Inc. and Pershing
Square Capital Management, L.P. (together with funds it advises,
Pershing Square) entered into a letter of agreement (referred to
herein as the Investor Agreement) regarding nominations to
Chipotles Board of Directors and a number of related matters.
The Investor Agreement provides for the nominations of Ali Namvar
and Matthew Paull for election to Chipotles Board at the 2017
annual meeting of shareholders and the 2018 annual meeting of
shareholders, a procedure for replacing Mr. Namvar with a
successor director in certain cases, and specified voting
obligations of Pershing Square with respect to Chipotles annual
shareholder meetings. In accordance with the Investor Agreement,
Pershing Square has further agreed to cause the resignation of
Mr. Namvar from Chipotles Board in the event Pershing Squares
ownership of Chipotles outstanding common stock falls below 5%.
Under the Investor Agreement, Pershing Square is also subject to
specified standstill restrictions lasting generally until the
later of the advance notice period for nominating directors at
Chipotles 2019 annual meeting of shareholders and a specified
period after Pershing Square ceases to have any representatives
serving on Chipotles Board.
Concurrent with the Investor Agreement, Chipotle and Pershing
Square also entered into a Confidentiality Agreement allowing
Pershing Square to receive non-public information regarding
Chipotle, subject to specified confidentiality obligations. The
form of the Confidentiality Agreement is included as an exhibit
to the Investor Agreement.
The Investor Agreement contains various other obligations and
provisions applicable to Chipotle and Pershing Square.
The foregoing descriptions of the Investor Agreement and the
Confidentiality Agreement are qualified in their entirety by
reference to the full text of the Investor Agreement (including
the form of Confidentiality Agreement included as an exhibit
thereto), which is attached hereto as Exhibit 10.1 and is
incorporated by reference herein.
Item5.02.Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
On December 14, 2016, Chipotle Mexican Grill, Inc. appointed four
new members to its Board of Directors: Paul Cappuccio, Robin
Hickenlooper, Ali Namvar, and Matthew Paull. Messrs. Namvar and
Paul were appointed to the Board at the request of Pershing
Square and in connection with the Investor Agreement described in
Item 1.01, above; there are no arrangements or understandings
with any person to which Mr. Cappuccio or Ms. Hickenlooper were
appointed to the Board. Since the beginning of the last fiscal
year, there have been no related party transactions between
Chipotle and any of the newly-appointeddirectors that would be
reportable under Item 404(a) of Regulation S-K. The new director
appointments increase the size of Chipotles Board to 12
members.The Board has not yet made determinations regarding the
appointment of any of the four newly-appointed directors to any
committees of the Board.
Each new directorother than Mr. Namvar will receive compensation
as an outside director of Chipotle under the director
compensation policies and programs as adopted by the Board from
time to time. The current Board Pay Policies are filed as Exhibit
10.1 to Chipotles Quarterly Report on Form 10-Q for the three
months ended March 31, 2015, filed with the Securities and
Exchange Commission on April 22, 2015. Mr. Namvar will waive his
right to compensation as a member of the Board.
Each new director will also execute Chipotles standard form
Indemnification Agreement for officers and directors, the form of
which is filed as Exhibit 10.1 to Chipotles Current Report on
Form 8-K filed with the Securities and Exchange Commission on
March 21, 2007.
On December 16, 2016, Chipotle issued a press release announcing
the matters addressed above. A copy of the press release is
attached hereto as Exhibit 99.1 and is incorporated by reference
herein.
Item9.01.Financial Statements and Exhibits.
|
Exhibit10.1 |
Investor Agreement dated December 14, 2016 |
|
Exhibit99.1 |
Press Release dated December 16, 2016 |
About CHIPOTLE MEXICAN GRILL, INC. (NYSE:CMG)
Chipotle Mexican Grill, Inc., together with its subsidiaries operates Chipotle Mexican Grill restaurants. The Company’s Chipotle Mexican Grill restaurants serve a menu of burritos, tacos, burrito bowls (a burrito without the tortilla) and salads. The Company operates approximately 1,970 Chipotle restaurants throughout the United States, over 10 in Canada, seven in England, four in France and one in Germany. The Company’s restaurants include over 10 ShopHouse Southeast Asian Kitchen restaurants, serving Asian-inspired cuisine. The Company owned and operated approximately three Pizzeria Locale restaurants, a fast casual pizza concept, resulting in a totaling of approximately 2,010 restaurants. The Company sells gift cards which do not have an expiration date. CHIPOTLE MEXICAN GRILL, INC. (NYSE:CMG) Recent Trading Information
CHIPOTLE MEXICAN GRILL, INC. (NYSE:CMG) closed its last trading session up +0.09 at 389.47 with 624,335 shares trading hands.
