Company Name: Chipotle Mexican Grill, Inc.
Public Availability Date: February 20, 2008
Document Sections:
INQUIRY LETTER
APPENDIX 1
APPENDIX 2
INQUIRY LETTER
STAFF REPLY LETTER
[INQUIRY LETTER]
January 11, 2008
Office of the Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: Shareholder Proposal of People for the Ethical Treatment of Animals Exchange
Act of 1934Rule 14a-8(i)(7)
Dear Ladies and Gentlemen:
This letter is to inform you that Chipotle Mexican Grill, Inc. ("Chipotle" or
the "Company") intends to omit from its proxy statement and form of proxy for
its 2008 Annual Shareholders Meeting (collectively, the "2008 Proxy Materials")
a shareholder proposal and statements in support thereof (the "Proposal")
received from People for the Ethical Treatment of Animals (the "Proponent").
Pursuant to Rule 14a-8(j), I have:
enclosed herewith six (6) copies of this letter and its attachments;
filed this letter with the Securities and Exchange Commission (the
"Commission") no later than eighty (80) calendar days before Chipotle expects to
file the definitive 2008 Proxy Materials with the Commission; and
concurrently sent copies of this correspondence to the Proponent.
I have also included an additional copy of this letter and a self-addressed,
postage-paid envelope. Please acknowledge receipt of this letter by
date-stamping the additional copy and returning to me in the envelope provided.
Rule 14a-8(k) provides that a shareholder proponent is required to send the
company a copy of any correspondence that the proponent elects to submit to the
Commission or the staff of the Division of Corporation Finance (the "Staff").
Accordingly, we are taking this opportunity to inform the Proponent that if the
Proponent elects to submit additional correspondence to the Commission or the
Staff with respect to the Proposal, a copy of that correspondence should
concurrently be furnished to the undersigned on behalf of Chipotle pursuant to
Rule 14a-8(k).
BASIS FOR EXCLUSION
We respectfully request that the Staff concur in our view that the Proposal may
be excluded from the 2008 Proxy Materials pursuant to Rule 14a-8(i)(7) because
the Proposal deals with a matter relating to Chipotle's ordinary business
operations.
THE PROPOSAL
The Proposal "encourage[s] the board to give purchasing preference to suppliers
that use or adopt controlled-atmosphere killing ("CAK")." The Proposal's
supporting statements acknowledge that this purchasing preference would require
a change to Chipotle's current purchasing practices.
A copy of the Proposal and all related correspondence from the Proponent is
attached to this letter as Exhibit A.
ANALYSIS
The Proposal May Be Excluded Pursuant to Rule 14a-8(i)(7).
Rule 14a-8(i)(7) permits the omission of a shareholder proposal from a company's
proxy materials if it deals with a matter relating to the company's ordinary
business operations. According to the Commission's Release accompanying the 1998
amendments to Rule 14a-8, the underlying policy of the ordinary business
exclusion is "to confine the resolution of ordinary business problems to
management and the board of directors, since it is impracticable for
shareholders to decide how to solve such problems at an annual shareholders
meeting." See Release No. 34-40018 (May 21, 1998) (the "1998 Release").
In the 1998 Release, the Commission described the two "central considerations"
for the ordinary business exclusion. The first was that certain tasks are "so
fundamental to management's ability to run a company on a day-to-day basis that
they could not, as a practical matter, be subject to shareholder oversight."
Examples of such tasks cited by the Commission were "management of workforce,
such as the hiring, promotion, and termination of employees, decisions on
production quality and quantity, and the retention of suppliers." See 1998
Release (emphasis added).
The second consideration related to "the degree to which the proposal seeks to
`micromanage' the company by probing too deeply into matters of a complex nature
upon which shareholders, as a group, would not be in a position to make an
informed judgment." See 1998 Release. The rationale for this policy is that it
"is manifestly impracticable in most cases for stockholders to decide management
problems at corporate meetings." See Release No. 34-19135, n. 47 (October 14,
1982).
We believe the Proposal is excludable pursuant to Rule 14a-8(i)(7) because it
interferes with tasks that are fundamental to management's ability to run the
Company and because it seeks to micro-manage the Company's day-to-day business
operations. We further believe these considerations weigh in favor of allowing
the exclusion of the Proposal notwithstanding any social policy issues
implicated by the Proposal.
I. The Proposal Interferes with Tasks Fundamental to Management's Ability to Run
the Company.
The ability to make decisions as to the Company's "retention of suppliers" is an
example of an ordinary business matter that is so "fundamental to management's
ability to run a company on a day-to-day basis" that it could not, as a
practical matter, be subject to direct shareholder oversight. See 1998 Release.
The Staff has consistently taken the position that shareholder proposals
regarding the selection of suppliers may be omitted from the issuer's proxy
materials pursuant to Rule 14a-8(i)(7) because they "deal with ordinary business
matters of a complex nature that shareholders, as a group, would not be
qualified to make an informed judgment on, due to their lack of business
experience and their lack of intimate knowledge of the issuer's business." See
Release No. 34-12999 (November 22, 1976). In Wal-Mart Stores, Inc. (April 10,
1991) ("Wal-Mart I"), for example, the Staff granted no-action relief with
respect to a proposal requesting a report on the company's efforts to give
purchasing preference to suppliers owned by minority and female-owned
businesses. In doing so, the Staff "particularly note[d] that the proposal
involves a request for detailed information on...the Company's practices and
policies for selecting suppliers of good and services." Similarly, the Staff has
permitted the exclusion of proposals addressing the animal care practices and
procedures followed by a company's suppliers. See, e.g., Hormel Foods Corp.
(November 19, 2002) ("Hormel I") (the Staff concurred that a proposal requesting
a report on the use of antibiotics by the company's meat suppliers was
excludable as an ordinary business matter); Seaboard Corporation (March 3, 2003)
(the Staff found a proposal requesting a report on the use of antibiotics by the
company's hog suppliers excludable as relating to ordinary business operations).
Like any restaurant company, Chipotle considers numerous factors in selecting
and retaining its suppliers, including but not limited to the quality of
products offered; competitive pricing; ability to supply particular quantities
of product; environmental, health and safety performance; location; and human
resources practices. Moreover, Chipotle maintains and publicizes a philosophy of
"Food With Integrity," one important aspect of which is a set of protocols
regarding the care and raising of the animals from which suppliers obtain the
meat Chipotle serves in its restaurants. Evaluating the many considerations
relevant to Chipotle's selection of suppliers, including formulation of the
protocols that become a part of Chipotle's Food With Integrity philosophy, is an
integral part of Chipotle's daily business operations and cannot, from a
practical standpoint, be subject to direct shareholder oversight. The Proposal
encourages Chipotle's management to give purchasing preference to suppliers that
use CAK, which necessarily intrudes upon the Company's selection of, and
relationships with, its suppliers.
As demonstrated by the Wal-Mart I, Hormel I and Seaboard no-action letters, the
Proposal should be excludable pursuant to Rule 14a-8(i)(7). The Proposal, like
the proposal in Wal-Mart I, seeks to influence a company's management through
specifying a purchasing preference for particular suppliers based on unique
characteristics of the suppliers. Just as the proposal in Wal-Mart I sought to
influence management to give purchasing preference to suppliers owned by
minority or women owners, the Proposal seeks to influence the Company's
management to give purchasing preference to suppliers that use CAK. In addition,
this Proposal is an even more egregious intrusion into management's right to
control the retention of suppliers, by directly encouraging management to give
preference to certain suppliers, whereas the excludable proposal in Wal-Mart I
merely sought a report regarding specified purchasing preferences.
Further, the Proposal, like the proposals in Hormel I and Seaboard, seeks to
influence a company's purchasing decisions based on animal care protocols
observed by the suppliers. The proposals in Hormel I and Seaboard sought reports
regarding a particular element of the animal care practices of the companies'
suppliers, and it can reasonably be assumed that the shareholders' intent in
seeking these reports was to influence management's purchasing decisions. This
Proposal goes one step further than the proposals in Hormel I and Seaboard by,
rather than simply seeking reports on a supplier practices, actively encouraging
the Company's management to choose suppliers based upon such practices, thereby
directly seeking to dictate Chipotle's purchasing decisions. The Staff has
consistently recognized that "the choice of products and supplies used in
preparation of [a company's] products" is a matter relating to the company's
ordinary business operations, and therefore is an inappropriate area for
shareholder proposals. See, e.g., The Kroger Co. (March 23, 1992); Borden, Inc.
(March 23, 1992); McDonald's Corp. (March 24, 1992); H.J. Heinz (June 2, 1999).
Consequently, because the Proposal intrudes on management's right to control the
retention of suppliers, we believe the Proposal is excludable.
II. The Proposal Seeks to Micro-manage the Company.
The Staff has also permitted the exclusion of proposals that seek to
"micro-manage" a company. These proposals involve complex matters that
shareholders, as a group, are generally unable to make informed decisions about.
Consequently, such decisions are left to the expertise of a company's
management. See, e.g., Pfizer Inc. (January 28, 2005) (the Staff granted
no-action relief regarding a proposal requesting the cessation of donations to
organizations that promote animal testing, because the company made thousands of
donations in a single year and to interfere with these practices would delve too
deeply into the micro-management of the company); and NSTAR (November 29, 2005)
(proposal seeking a report on management's response to animals being shocked by
the company's electric utility network was excluded as ordinary business).
Implementation of a specific new technology, such as CAK, requires a complex
assessment of costs and benefits requiring specialized expertise and business
judgment. Management is uniquely suited to conduct this analysis and consider
the financial, quality, safety, public perception, timing and feasibility
aspects of demanding that its poultry suppliers use a specific technology, or
alternative technologies. Based on the complexities and unique considerations
involved in such analyses, the Staff has consistently permitted exclusion of
proposals seeking to implement specific technologies or processes. See, e.g.,
Union Pacific Corp. (December 16, 1996) (proposal seeking status report on new
railroad safety systems was excluded as dealing with ordinary business
operations, the Staff noting that the proposal involved "the development and
adaptation of new technology"); WPS Resources Corp. (February 16, 2001) ("choice
of new technologies" relates to ordinary business matters); and McDonald's
(allowing the exclusion of a proposal dealing with food preparation processes as
ordinary business despite the existence of the social issue of public health).
The Proposal's clear purpose is the implementation of CAK. As the Proposal's
supporting statements indicate, Chipotle does not presently have a plan to
implement CAK. However, Chipotle has explored the merits of CAK with its
suppliers and advisors, and based in part on the myriad considerations involved
in determining whether to adopt a preference for CAK, has not come to any
definitive conclusions on the issue. In prior shareholder proposals to other
companies, the Proponent has recognized and deferred to management's difficult
role in assessing complex technologies by proposing that management assess the
feasibility of CAK. See, e.g., OSI Restaurant Partners, Inc. (March 6, 2006);
and Wendy's International, Inc. (February 8, 2005). This Proposal, however, does
not defer to management and ask it to simply consider the implementation of CAK,
but rather encourages management to proceed directly to adoption of a purchasing
preference for suppliers that use CAK. By directly encouraging implementation of
a specific technology, the Proponent moves from implicitly advancing a
particular technology that it believes to be beneficial into active
micro-management of Chipotle's business.
In such circumstances, the Staff's practice has been to allow exclusion of the
proposal. For example, technology that would advance railroad safety would
certainly be socially beneficial, but in Union Pacific, the Staff determined the
specific manner in which a company addresses the issue of railroad safety (i.e.
the choice and manner of implementing a new technology) to be an ordinary
business matter. Similarly, although Chipotle agrees that seeking the humane
treatment of animals is a laudable goal, the Proposal is attempting to dictate
the precise timing and method of addressing the issue and therefore is not
appropriate. Consequently, we believe that, like the proposal in Union Pacific,
the Proposal is excludable.
III. Regardless of Whether the Proposal Touches Upon Significant Social Policy
Issues, the Entire Proposal is Excludable Because It Predominantly Addresses
Ordinary Business Matters.
We acknowledge that in the 1998 Release, the Staff noted that a shareholder
proposal related to ordinary business operations that primarily focuses on
sufficiently significant social policy issues generally would not be excludable
because the proposals would transcend day-to-day business matters, and raise
policy issues so significant that they would be appropriate for a shareholder
vote. We also recognize that the Staff has previously found that "humane
treatment of animals in product development and testing" is a significant social
policy issue, see, e.g., Gillette Co. (January 4, 1996), and has previously
declined to allow the exclusion of proposals from the Proponent regarding CAK.
See, e.g., Wendy's; Hormel Foods Corp. (November 10, 2005) ("Hormel II").
Nevertheless, the Staff also has consistently concurred that a proposal may be
excluded in its entirety when it addresses both ordinary business matters and
significant social policy issues. See, e.g., Wal-Mart Stores, Inc. (March 15,
1999) ("Wal-Mart II") (the Staff found a proposal requesting a report to ensure
that the company did not purchase goods from suppliers using, among other
things, forced labor, convict labor and child labor excludable in its entirety
pursuant to Rule 14a-8(i)(7) because the proposal sought to direct management's
selection of suppliers); and General Electric Co. (February 3, 2005) (the Staff
concurred that a proposal relating to "the elimination of jobs with the [c]ompany
and/or the relocation of U.S. based jobs by the [c]ompany to foreign countries"
was excludable under Rule 14a-8(i)(7) as relating to "management of the
workforce" even though the proposal also related to offshore relocation of
jobs).
The Proposal, like the proposal in Wal-Mart II, should be excludable pursuant to
Rule 14a-8(i)(7) because, as in Wal-Mart II, the Proposal relates to a social
policy issue of clear significance, but also pertains to an overarching ordinary
business matter. Just as the excludable proposal in Wal-Mart II pertained to the
human rights of the employees of the company's suppliers (a significant social
issue) and the retention of the company's suppliers (an ordinary business
matter), the Proposal concerns the humane treatment of animals (a significant
social issue) and the retention of suppliers (an ordinary business matter).
Consequently, like the proposal in Wal-Mart II, the extensive implications that
the Proposal would have with regard to Chipotle's supplier decisions dictate
that the entire Proposal should be excludable.
Further, the Proposal is distinguishable from prior proposals made by the
Proponent where the Staff has declined to grant no-action relief. In Wendy's and
Hormel II, the Proponent recognized and deferred to management's authority over
the business decision of choosing among suppliers, by proposing only that
management issue a report regarding the feasibility of CAK. In this Proposal,
however, the Proponent goes much further and encourages Chipotle's management to
proceed directly to adoption of a purchasing preference for suppliers that use
CAK, regardless of any consideration by Chipotle of the complex issues related
to making a business decision to adopt such a preference. In that sense, the
Proposal impermissibly intrudes to a great extent into ordinary business
matters. In spite of the weighty social policy issues in Wal-Mart II and General
Electric, the Staff decided that the proposals were excludable because of the
predominance of the ordinary business matter issues. Because this Proposal seeks
to directly intrude into Chipotle's supplier decisions, we believe that the
ordinary business matters with which the Proposal would interfere are similarly
predominant, and therefore weigh in favor of the exclusion of the Proposal.
CONCLUSION
Based on the foregoing analysis, we respectfully submit that the Proposal may be
omitted from Chipotle's 2008 Proxy Materials pursuant to Rule 14a-8(i)(7), and
request your confirmation that the Staff will not recommend enforcement action
if the Proposal is omitted from our 2008 Proxy Materials.
If you have any questions, require further information, or wish to discuss this
matter, please call me at (303) 222-5978. My facsimile number for future
correspondence is (303) 222-5983. Thank you for your consideration of this
matter.
Sincerely,
/s/
Michael M. McGawn
Corporate Compliance Counsel
Enclosures
cc: Mr. Matt Prescott
Assistant Director, Corporate Affairs
People for the Ethical Treatment of Animals
501 Front Street
Norfolk, VA 23510
Christian O. Nagler and Robert M. Hayward (via e-mail)
Kirkland & Ellis LLP
Bryant S. "Corky" Messner (via e-mail)
Messner & Reeves LLC
[APPENDIX 1]
December 20, 2007
Mr. Monty Moran
Corporate Secretary
Chipotle Mexican Grill, Inc.
1543 Wazee St. Suite. 200
Denver, CO 80202
Re: Shareholder Proposal for Inclusion in the 2008 Proxy Materials
Dear Mr. Moran:
Attached to this letter is a shareholder proposal submitted for inclusion in the
proxy statement for the 2008 annual meeting. Also enclosed is a letter from
People for the Ethical Treatment of Animals' (PETA) brokerage firm, Morgan
Stanley, confirming ownership of 65 shares of Chipotle Mexican Grill common
stock. PETA has held these shares continuously for more than one year and
intends to hold them through and including the date of the 2008 annual
shareholders meeting:
Please contact me if you need any further information. If Chipotle Mexican Grill
will attempt to exclude any portion of this proposal under Rule 14a-8, please
advise me within 14 days of your receipt of this proposal. I can be reached at
757-962-8264 or via e-mail at MattPrescott@peta.org.
Sincerely,
/s/
Matt Prescott, Assistant Director
Corporate Affairs
Enclosures: 2008 Shareholder Resolution
Morgan Stanley letter
[APPENDIX 2]
Shareholder Resolution Regarding Poultry Slaughter
RESOLVED that, to advance both Chipotle's financial interests and the welfare of
birds supplied to its restaurantsand to harmonize the company's claims with its
actionsshareholders encourage the board to give purchasing preference to
suppliers that use or adopt controlled-atmosphere killing (CAK).
Supporting Statement
Chipotle promotions have touted its sourcing of meat from suppliers with
better-than-standard animal welfare practices and made such claims as "We
believe animals deserve respect, too" and "Chickens raised with care, not
chemicals." Clearly, good animal welfare is part of the company's philosophy.
These claims are not consistent with the fact that Chipotle purchases poultry
from suppliers that use a cruel and inefficient method of slaughter called
"electrical immobilization," in which the birds are paralyzed with an electric
current, have their throats slit while they are still conscious, and are dropped
into tanks of scalding-hot water (often while they are still alive).
CAK is a better, U.S. Department of Agriculture-approved method of poultry
slaughter that replaces the oxygen that birds are breathing with inert gases,
gently and effectively putting them "to sleep."
Many restaurant companies have made notable progress in evaluating and moving
toward CAK, such as Burger Kingwhich has a purchasing preference for birds
killed by CAKand Wendy's, Carl's Jr., and Hardee's, which give consideration to
CAK suppliers.
A report commissioned by McDonald's concurred that CAK is, as animal welfare
experts have described it, the least cruel method of poultry slaughter available
and found that it "[1.] has advantages [over electrical immobilization] from
both an animal welfare and meat quality perspective ... [2.] obviates potential
distress and injury ... [and 3.] can expeditiously and effectively stun and kill
broilers with relatively low rates of aversion or other distress." The report
further concludes that McDonald's suppliers that use CAK have experienced
improvements in bird handling, stunning efficiency, working conditions, and meat
yield and quality.
[INQUIRY LETTER]
January 18, 2008
BY REGULAR & ELECTRONIC MAIL: cfletters@sec.gov
Office of the Chief Counsel
Division of Corporation Finance
U.S. Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
Re: Shareholder Proposal of People for the Ethical Treatment of Animals ("PETA")
for Inclusion in the 2008 Proxy Statement of Chipotle
Ladies and Gentlemen:
This letter is filed in response to a letter dated December 17, 2007 submitted
to the SEC by Chipotle ("Chipotle" or "the Company"). The Company seeks to
exclude a shareholder proposal submitted by PETA based on Rule 14a-8(i)(7),
asserting that that the proposal relates to ordinary business operations.
The resolution at issue reads as follows:
RESOLVED that, to advance both Chipotle's financial interests and the welfare of
birds supplied to its restaurantsand to harmonize the company's claims with its
actionsshareholder encourage the board to give purchasing preferences to
suppliers that use or adopt controlled-atmosphere killing (CAK).
For the reasons that follow, PETA respectfully disagrees with the Company's
position that the proposal should be omitted and urges the Staff to rule
accordingly.
I. The Proposal Is Not Subject to Omission Under Rule 14a-8(i)(7).
Chipotle argues that the proposal involves the conduct of its "day-to-day"
business operations" and seeks to "micro-manage" the Company. (No action letter
p. 2.)
PETA has the following responses to Chipotle's arguments:
1. The proposal does not seek to compel the Company to do anything. Rather, it
is crafted to "encourage" the Company to pursue a course of action.
Chipotle contends that the proposal "interferes with tasks that are fundamental
to management's ability to run the Company" (p.3); "intrudes upon the Company's
selection of... suppliers" (p. 3); and seeks to "dictate Chipotle's purchasing
decisions" (p. 4). However, the resolution does none of the above and the Staff
need only look at the plain language of the proposal to confirm the point. The
emphasis here is on the words "shareholders encourage" not compel, require,
induce, or insist. Shareholders "encourage" the board to consider a corporate
policy that has significant implications on the treatment of animals.
Shareholders should be given an opportunity to vote on this resolution so that
the Board can realize the level of support for it.
2. The proposal involves broad and significant social and public policy
considerations.
The Company cites to Exchange Act Release No. 34-40018 (May 21, 1998) but not to
its later interpretation in Staff Legal Bulletin No. 14C released June 28, 2005.
Those authorities support the proposition that the pivotal question is whether
the proposal is focused on the internal fiscal operations of the company, or on
"broader policy issues." Chipotle acknowledges that a proposal that "focuses on
sufficiently significant social policy issues generally would not be excludable
because it would transcend day-to-day business matters, and raise policy issues
so significant that they would be appropriate for a shareholder vote." (No
action letter p. 5.) Nevertheless, the Company argues that the resolution
"pertains to an overarching ordinary business matter." (No action letter p. 6.)
To this we respond that the proposal is, as the Company recognizes it to be,
overtly and expressly concerned with the social policy issue of animal
welfarethat is what the "Resolved" clause states, and that is what the
supporting statement is focused on.
3. The resolution supersedes the ordinary business rule because it implicates
issues that are, and continue to be, the subject of public concern and debate.
Public awareness about the way in which animals are raised and killed for food
has entered the mainstream. For example, many large restaurant and grocery
chains have yielded to public pressure and moved toward less-cruel food
purchasing practices. Hardee's, Burger King, and Carl's Jr.'s have initiated
programs to increase the purchase of cage-free eggs and pork from uncaged sows.
Celebrity chef, Wolfgang Puck has announced that he will not purchase products
from farms using "the worst practices associated with factory farming." Whole
Foods has also phased out the sale of eggs from caged hens. Both the State of
California and the City of Chicago have approved bans on the sale of foie gras
because of the cruelty involved in producing it; while Florida and Arizona have
banned gestation crates for sows, and Smithfield Foodsthe world's largest pork
producerhas announced they will be phased out.
These decisions are a result of increased public concern about animal welfare.
In fact, a recent survey by food industry consultancy, Technomic, reported that
animal welfare is the third most important social issue to American
restaurant-goers. An editorial appearing in the October 8, 2007 edition of
Nation's Restaurant NewsChipotle's industry trade publicationobserved that
"active concern about how we treat the world around us has moved from left of
center to the mainstream. A case in point is the growing number of companies
that are embracing purchasing policies with animal welfare in mind."
Similarly, an article in the December 2007 issue of MeatingPlacea meat industry
publicationreported that "Animal welfare isn't just an issue for activists
anymore. The average consumer is paying attention too."
An article that appeared in the June 20, 2006 edition of the Baltimore Sun
entitled "A hunger for humane foods" reported the following:
News from the front in the food wars: Live lobsters are a dead issue at Whole
Foods. Chicago and California have made foie gras non grata. ...As consumers ask
more questions about what they eatwhere it comes from, how it lived, how it was
killedthey are discovering that many meals come with ethical quandaries.
Retailers and restaurants are responding, hoping that a concern for animal
welfare also benefits the bottom line. [Emphasis supplied.]
In summary, PETA's proposal involves a matter of significant social importance
and thus is not eligible for exclusion under Rule 14a-8(i)(7). More critically,
the Company's argument that PETA's proposal would remove supplier selection from
the purview of management simply has no basis, as the resolution clearly and
explicitly is crafted in such a way as to not take away any purchasing decisions
from management, but rather simply "encourage" it to do something.
II. The Staff's Prior Non-Concurrence on the Same Topic Govern the Outcome of
Chipotle No Action Application.
Lastly, as Chipotle acknowledges, the Staff has already ruled on PETA's CAK
resolutions and refused to concur with the companies' positions. See, Wendy's
International, Inc. (Feb. 8, 2005) and Hormel Foods Corporation (Nov. 10, 2005)
and OSI Restaurant Partners, Inc. (Mar. 6, 2006) (Staff unable to concur with
the company's position that CAK proposal can be omitted.) Accordingly, the
disposition of this resolution should be the same as the Staff's previous
non-concurrences on other CAK proposals.
Conclusion
The Company's position that PETA's resolution is excludable under Rule
14a-8(i)(7) is insupportable. The proposal embraces a significant social and
public policy issue, and involves encouraging the Board to ameliorate the
mistreatment of animals. For the foregoing reasons, we respectfully request that
the SEC advise the Company that it will take enforcement action if it fails to
include the Proposal in its 2008 proxy materials. Please feel free to contact me
should you have any questions or require further information. I may be reached
directly at SusanH@peta.org or (202) 641-0999.
Very truly yours,
/s/
Susan L. Hall
Counsel
SLH/pc
cc: Michael M. McGawn, Chipotle (via email to mmcgawn@chipotle.com)
[STAFF REPLY LETTER]
February 20, 2008
Response of the Office of Chief Counsel Division of Corporation Finance
Re: Chipotle Mexican Grill, Inc. Incoming letter dated January 11, 2008
The proposal encourages the board to give purchasing preference to suppliers
that use or adopt controlled-atmosphere killing.
We are unable to concur in your view that Chipotle may exclude the proposal
under rule 14a-8(i)(7). Accordingly, we do not believe that Chipotle may omit
the proposal from its proxy materials under rule 14a-8(i)(7).
Sincerely,
/s/
William A. Hines
Special Counsel |
