Page 69 - Martin Marietta - 2021 Proxy Statement

COMPENSATION DISCUSSION AND ANALYSIS / POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

The benefits under the defined benefit pension plan are more valuable for employees who remain with Martin Marietta for
longer periods, thereby furthering our objectives of retaining individuals with more expertise in relevant areas and who can
also participate in management development for purposes of executive succession planning. All of Martin Marietta’s
salaried employees in the United States are eligible to participate in our retirement and other plans, and the NEOs
participate in the plans on the same terms as Martin Marietta’s other salaried employees.

Additional information regarding these benefits is under the heading Pension Benefits Table on page 71 and the
accompanying narrative.

Potential Payments upon Termination or Change of Control

We do not have written employment agreements with executives. Instead, each of our NEOs has a change of control
severance agreement (an Employment Protection Agreement) that provides for retention and continuity in order to
minimize disruptions during a pending or anticipated change of control. The agreements are triggered only by a qualifying
termination of employment in connection with a change of control. Martin Marietta’s equity-based award plans and
retirement plans also provide for certain post-termination payments and benefits, as well as, for equity awards granted
prior to 2020, the acceleration of time periods for purposes of vesting in, or realizing gain from, such equity award in the
event of a change of control. The Committee believes these payments and benefits are also important to align the interests
of the executive officers with the interests of the shareholders because the agreements will reduce or eliminate the
reluctance to pursue potential change of control transactions that may ultimately lead to termination of their employment
but would otherwise be in the best interests of our shareholders. The Employment Protection Agreements are described on
page 73 of this Proxy Statement.

Tax and Accounting Implications
In administering the compensation program for NEOs, for awards made in 2021 the Committee considered tax
consequences, including the limit on deductibility on compensation in excess of $1 million to certain executive officers
under Section 162(m) of the Internal Revenue Code and the consequences under financial accounting standards.
While the Committee considers the tax deductibility as one factor in determining executive compensation, the Committee
also looks at other factors in making its decisions, as noted above, and retains the flexibility to award compensation that it
determines to be consistent with the goals of our executive compensation program to attract talent, promote retention, or
recognize and reward desired performance even if the awards are not deductible for income tax purposes.

64 2021 PROXY STATEMENT