Page 69 - Martin Marietta - 2023 Proxy Statement

PERFORMANCE-BASED RSU AWARDS (45% OF LTI AWARD) / COMPENSATION DISCUSSION AND ANALYSIS

Performance-Based RSU Awards (45% of LTI Award)

RSUs vest in three equal portions, each on the anniversary of the grant date (February 14, 2022) over a period of three
years, subject to satisfaction of the performance measure and generally to continued employment through each one of
those anniversaries. Once the restricted period ends (each anniversary for one third of the total RSU award), the recipient
will be issued unrestricted shares of common stock (minus applicable taxes). The 2022 RSUs awarded to executive officers
are also subject to a performance measure that a stated level of Adjusted EBITDA be achieved during the first year. If the
performance measure is satisfied, then the RSUs will continue to vest. If the performance measure is not satisfied, then the
RSUs will be forfeited. For the 2022 grants, the performance measure was satisfied.

2022-2024 Performance Goals
In setting minimum and maximum levels of payment, we reviewed historical levels of performance against our long-range
plan commitments and conducted sensitivity analyses on alternative outcomes focused on identifying likely minimum and
maximum boundary performance levels. Levels between 100% and the minimum and maximum levels were derived using
linear interpolation between the performance hurdles.

The specific Adjusted EBITDA and Sales Growth target values for the 2022-2024 PSUs are not publicly disclosed at the time
of grant due to the proprietary nature and competitive sensitivity of the information. However, the method used to
calculate the awards will be based on actual performance compared to our 2022-2024 targets, with straight-line
interpolation between points. The individual award agreements require the adjustment of goals to ensure that the ultimate
payouts are not impacted to the benefit or detriment of management by specified events, such as unplanned pension
contributions, changes in accounting (GAAP) standards or impact of an acquisition or divestiture. The Committee may
exercise its discretion to reduce the final vesting percentage to no more than target if the Company’s three-year TSR is less
than zero.

The following table provides a summary of the long-term incentives that each of the NEOs was granted in 2022.

RSUs
(3 year annual PSUs – Target
installment vesting (3 year cliff vesting
subject to achievement subject to achievement
of performance of performance
measure) measures)
NEO (# of shares) (# of shares)
C. Howard Nye 8,270 10,107
James A. J. Nickolas 1,508 1,843
Roselyn R. Bar 1,531 1,872
Craig M. LaTorre 1,117 1,365
John P. Mohr 781 954

In setting performance goals for the three-year PSUs awarded in 2022, the Committee considered various factors and
received advice from its independent compensation consultant in choosing the metrics and establishing the goals,
including:
• The metrics reflect drivers of our performance and we believe are important to our investors.

• The goals are consistent with our business plan and positive over prior year.
• We have a history of setting challenging target and maximum goals.

In addition, we have looked at the alignment of our payouts with the Company’s performance, including TSR, and found
that pay and performance are aligned.

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