Company: CHEF
Filing Date: 2025-03-26
Form Type: DEF 14A
Source: 0001517175-25-000003
Chunk: 82

Company: Chefs' Warehouse, Inc.
Filing Date: 2025-03-26
Form: DEF 14A
Chunk 82
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 the proposal to increase the number of shares authorized for issuance is in the best interest of stockholders and supports this proposal for the following reasons:

• If the 2019 Plan Amendment is not approved, the Company will be compelled to significantly increase the cash-based component of employee compensation, which could reduce the alignment of employee and stockholder interests.

• The terms of our equity and other annual and long-term incentive compensation awards and our employee policies are designed to protect stockholder interests and encourage employees to focus on the long-term success of the Company.

• If our stockholders do not approve the 2019 Plan Amendment, the Amended 2019 Plan remains in effect and the Company may continue to grant awards, subject to its terms, conditions and limitations, using the remaining shares available for grant. Currently, the number of shares available for future grants does not meet our equity award needs. Consequently, if stockholders do not approve an increase in share capacity, the Company would have to re-evaluate the design of our compensation programs.

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Highlights of The Amended 2019 Plan</div>

| No Liberal Share Recycling                                             |     | The Amended 2019 Plan prohibits the reuse of shares withheld or delivered to satisfy the exercise price of an award or to satisfy tax withholding requirements.                                                                                                                                                                                                                                                                                                                                                                                   |
| Minimum Vesting Requirement                                            |     | All awards granted under the Amended 2019 Plan are subject to a one-year minimum vesting period from the award’s grant date, subject to an exception for up to 5% of the authorized share pool and the plan administrator’s discretion to grant substitute awards.                                                                                                                                                                                                                                                                                |
| Burn Rate                                                              |     | The 3-year average burn rate of the Amended 2019 Plan is 2.0%.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Overhang                                                               |     | Our “overhang” at March 17, 2025 was 5.0%. If the 1,550,000 additional shares proposed to be authorized for grant under the 2019 Plan Amendment were included, our overhang on that date would have been 8.3%. “Overhang” is the sum of the total number of shares (1) underlying all equity awards outstanding and (2) available for future award grants, divided by: the sum of the total number of shares (a) underlying all equity awards outstanding, (b) available for future award grants, and (c) outstanding at the time of calculation. |
| Payment of Divid