Page 65 - Martin Marietta - 2023 Proxy Statement

2022 ANNUAL CASH INCENTIVE GOALS AND RESULTS / COMPENSATION DISCUSSION AND ANALYSIS

2022 Annual Cash Incentive Goals and Results

NEOs and other executives are eligible to earn annual incentive compensation under our Executive Cash Incentive Plan
based on the achievement of various performance metrics. Individual NEO targets (as a percent of base salary) are
approved by the Committee at the beginning of the year based on a review of competitive market data, the advice of the
Committee’s independent compensation consultant, and internal pay equity.

The Committee awards actual annual cash incentive compensation based on achievement against corporate performance
objectives and individualized targeted goals. This furthers Martin Marietta’s compensation philosophy to encourage
superior performance and reward the achievement of Martin Marietta’s annual goals. The Committee determined the
2022 incentive awards in February 2023. In 2022, all of the executive officers participated in the plan. The annual incentive
compensation level paid for 2022 for the NEOs other than Mr. Nye was 160% to 185% of target. The annual incentive
compensation level paid for 2022 for Mr. Nye was 160%.

In determining the incentive payment for the CEO, the Committee first reviews the achievements of Martin Marietta for
the past year as compared to its targeted goals set at the end of the previous year. Our financial goals are established at
the completion of our annual planning process, which for 2022 were determined in November 2021. The annual planning
process includes reviews of the assumptions used by the business segments in generating their financial projections, such
as industry trends and competitive assessments, current and future projected performance levels, and the risks and
opportunities surrounding these baseline assumptions. The annual plan on which our financial goals are based is tied to
the business environment in which we operate and can vary year-over-year.

Key individual performance criteria are established for each NEO, which are intended to drive strategic focus and support
operational results in the Company and the functional groups. For the NEOs other than Mr. Nye, 50% of the
determination is made with respect to Martin Marietta’s performance against the same goals as Mr. Nye and 50% is based
on the individual’s performance against established objectives.

The individualized target goals are tailored for each executive, based on his or her specific areas of responsibility and the
then-current and longer-term goals of Martin Marietta. In addition, the NEO’s achievement of the goals typically is in part
dependent on conditions outside the control of each of the NEOs. For example, our business may be adversely affected by
hurricanes or other weather-related conditions, which could have the result of impeding the achievement of certain
performance-based goals. Similar to the Committee’s assessment of financial goals, the Committee’s assessment of
individual performance goals generally excludes unusual or extraordinary items.

The Committee also reviewed and considered management’s furtherance of its strategic plan, including a primary objective
of value-enhancing growth, and the advancement of the Mission, Vision, and Values of the Company to unify
management with the same objectives.

The Committee conducted a comparative review of the individual contributions of each of the executive officers towards
achieving these goals. The Committee also considered qualitative measures of performance for the executive officers, such
as adherence to and implementation of Martin Marietta’s Code of Ethical Business Conduct, customer satisfaction, and
product quality.

The maximum incentive compensation is fixed based on objective criteria as described in the Executive Cash Incentive Plan,
and the Committee then determines an appropriate award payout beneath the maximum amount based on the factors
described above. We set challenging, but attainable, targets and our NEOs have a reasonable expectation of receiving cash
incentive awards that reflect the achievement of our short- and long-term objectives as well as their individual
performances.

2022 Actual Incentive Cash Earned

In 2022, the Committee determined that Company and individual performance warranted the annual incentive payments
in the following chart based on a review of financial metrics and other important achievements. The Committee reviews

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