Page 69 - Martin Marietta - 2024 Proxy Statement

ANNUAL INCENTIVE FEATURE: STOCK PURCHASE PLAN / COMPENSATION DISCUSSION AND ANALYSIS

Annual Incentive Feature: Stock Purchase Plan
The Incentive Stock Plan further promotes the alignment of executive compensation levels with our investors’ financial
interests by allowing a portion of the annual bonus award to be deferred into Company stock units that vest based on
continued service. The voluntary election allows executives to invest up to 50% of their annual cash incentive
compensation to purchase units that are subsequently converted into shares of common stock pursuant to the terms of
the plan at a 20% discount from the market price of Martin Marietta’s common stock on the date the amount of the
incentive compensation is determined. The discount is used to account for the risk of trading current cash compensation
for “at-risk” shares which may decline in value.

The units generally vest in three years from the date of the award and are distributed in shares of common stock. If an
executive officer voluntarily terminates employment before the units vest, the stock units are forfeited and the executive
officer receives a cash payment equal to the lesser of the cash that was invested or the fair value of the share units on the
day of termination.

The contribution directly links a portion of executive officer compensation to shareholder returns. The vesting aspect, combined
with the yearly stock purchase requirement, creates continuous overlapping three-year cycles, which encourage executive
officer retention and provide a continuous link of a significant portion of executive officer compensation with shareholder
return over the long-term to reward these executive officers in line with our shareholders when our stock price increases.

2023 Long-Term Incentive Compensation Overview

Our LTI plan design reflects the objectives of our compensation program and is in-line with current market approaches,
based on the advice of the Committee’s independent compensation consultant. Our plan design objectives are a simplified
LTI program that is transparent and enhances the line of sight between our performance and compensation.

The award in 2023 for all NEOs was determined as a fixed percentage of base salary with some variation for position and
grade, which amount was converted into common stock units based on the average Martin Marietta stock price for the
20-day period ending on February 24, 2023, the day the Committee confirmed the award, or $360.29. This award value
was then divided into PSUs and RSUs, with 55% of the total award for NEOs consisting of the PSUs at target level and
45% of the total award for NEOs consisting of RSUs. The Committee believes that the incentive mix (PSUs and RSUs)
constitutes an appropriate pay process and streamlined plan, which more fully reflects the performance of the Company
and is better aligned with each NEO’s role within Martin Marietta. See a further description under Outstanding Equity
Awards at Fiscal Year-End and corresponding footnotes on page 77.

The following table provides a notional example of the LTI plan design.
LTI
LTI Target PSU RSU
Salary Target Value PSU Value RSU Value
$ % $ % $ % $
$150,000 140% $210,000 55% $115,500 45% $94,500

The following table provides a summary of the long-term incentives that each of the NEOs was granted in 2023.
PSUs – Target
(3 year cliff vesting
RSUs subject to achievement
(3 year annual of performance
installment vesting) measures)
NEO (# of shares) (# of shares)
C. Howard Nye 8,431 10,305
James A. J. Nickolas 1,487 1,817
Roselyn R. Bar 1,509 1,844
Robert J. Cardin 705 861
Michael J. Petro 650 794

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