UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
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Meritage Homes Corporation
(Name of Registrant as Specified In Its Charter)
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Dear Fellow Stockholders:

You are cordially invited to join us for our 2018 annual meeting2023 Annual Meeting of stockholders which will be held on May 17, 2018,18, 2023, at 8:30 a.m. local timePacific Time. The meeting will be completely virtual and conducted via live audio webcast to enable our stockholders to participate from any location around the world that is convenient to them. You will be able to attend the meeting by first registering at our corporate officehttps://viewproxy.com/meritage/2023/ no later than May 15, 2023 at 8800 E. Raintree Drive, Suite 300, Scottsdale, Arizona, 85260. 11:59 PM Eastern Time. After registering, you will receive a meeting invitation and password by e-mail with your unique link to join the meeting. Stockholders will be able to listen, vote and submit questions during the virtual meeting.Holders of record of our common stock as of March 21, 201823, 2023 are entitled to notice of, and to vote at, the 2018 annual meeting.2023 virtual Annual Meeting.

The Notice of Annual Meeting of Stockholders and the proxy statement that follow describe the business to be conducted at the meeting. We may also report on matters of current interest to our stockholders at that meeting.

We are pleased to be furnishing these materials to our stockholders via the Internet.electronically. We believe this approach provides you with the information that you need in an expedited manner while expediting your receipt of these materials, lowering our costs of delivery, and reducing both the environmental impact and delivery costs of our annual meeting.Annual Meeting. If you would like us to send you printed copies of our proxy statement and accompanying materials, we will be happy to do so at no charge upon your request. For more information, please refer to the Important Notice of InternetRegarding the Availability of Proxy Materials that we previously mailed to you on or about April 2, 2018.3, 2023.
You
All stockholders are welcome to attend the meeting. However, even if you plan to attend,virtual Annual Meeting, however, please vote your shares promptly and prior to the meeting to ensure they are represented at the meeting. You may submit your proxy by Internet or telephone, as described in the following materials, or, if you request printed copies of these materials, by completing and signing the proxy or voting instruction card enclosed therein and returning it in the envelope provided. If you decide to attend the meeting and wish to change your proxy, you may do so automatically by voting in person at the meeting.

If your shares are held in the name of a broker, bank, trust or other nominee, you maywill be asked for proof of ownership of theseyour shares in order to be admittedregister to attend the virtual meeting.

We thank you for your support.
Sincerely,
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Steven J. HiltonPhillippe Lord
Chairman and Chief Executive Officer


8800 East Raintree Drive • Suite 300 • Scottsdale, Arizona • 85260 • Phone 480-515-8100
Listed on the New York Stock Exchange — MTH





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Notice of Annual Meeting of Stockholders
Meeting Date: May 17, 201818, 2023
Time: 8:30 a.m. local timePacific Time
Meritage Homes Corporation
8800 East Raintree Drive, Suite 300
Scottsdale, Arizona 85260Virtual location: See details below for registration
To Our Stockholders:
You are invited to attend the Meritage Homes Corporation 20182023 annual meeting of stockholders, to be held in a virtual-only format via live audio webcast, at which we will conduct the following business:
1Election of five Class I directors, each to hold office until our 2020 annual meeting,
2Ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the 2018 fiscal year,
3Advisory vote to approve compensation of our Named Executive Officers ("Say on Pay"),
4Approval of our 2018 Stock Incentive Plan, and
5The conduct of any other business that may properly come before the meeting or any adjournment or postponement thereof.
1Election of five Class II directors, each to hold office until our 2025 annual meeting,
2Ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the 2023 fiscal year,
3Advisory vote to approve compensation of our Named Executive Officers ("Say on Pay"),
4Advisory vote on the frequency of future advisory votes on Say on Pay,
5Amendment to our 2018 Stock Incentive Plan to increase the number of shares available for issuance, and
6The conduct of any other business that may properly come before the meeting or any adjournment or postponement thereof.

These items and information regarding the admission policy and procedures for attending the virtual Annual Meeting are more fully described in the accompanying proxy. Only stockholders of record at the close of business on March 21, 201823, 2023 are entitled to notice of, and to vote at, the annual meeting or any adjournment or postponement thereof.
YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, PLEASEVIRTUALLY, WE URGE YOU TO VOTE AND SUBMIT YOUR PROXY IN ADVANCE OF THE MEETING BY FOLLOWINGONE OF THE INSTRUCTIONS SET FORTHMETHODS DESCRIBED IN THE FOLLOWING MATERIALS.PROXY MATERIALS FOR THE ANNUAL MEETING. YOU MAY VOTE YOUR SHARES AND SUBMIT A PROXY OR VOTING INSTRUCTION CARD BY USING THE INTERNET, REGULAR MAIL OR TELEPHONE AS DESCRIBED HEREIN OR ON YOUR PROXY OR VOTING INSTRUCTION CARD.
By Order of the Board of Directors
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                   C. Timothy White,Malissia Clinton, Secretary
Scottsdale, Arizona
March 26, 201824, 2023
IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUALSHAREHOLDER MEETING OF STOCKHOLDERS TO BE HELD ON MAY 17, 2018:18, 2023:
THIS PROXY STATEMENT AND MERITAGE’S 20172022 ANNUAL REPORT TO STOCKHOLDERS ARE AVAILABLE ATINVESTORS.MERITAGEHOMES.COM.ADDITIONALLY, AND IN ACCORDANCE WITH SEC THE SECURITIES AND EXCHANGE COMMISSION("SEC") RULES, YOU MAY ACCESS THESE MATERIALS ON THE COOKIES-FREE WEBSITE INDICATED IN THE NOTICE OF INTERNET AVAILABILITY OF PROXY MATERIALS THAT YOU HAVE RECEIVED.


TABLE OF CONTENTS




Table of Contents
TABLE OF CONTENTS
Table of Contents
2

General Information
2

The Proposals
3

6

7

8

Approval
10
Amendment to our 2018 Stock Incentive Plan (Proposal (Proposal No. 4)5)
10
11
1716

1918

29

2017 Environment
29

Executive Summary
29

Compensation Philosophy and Objectives
3134

Compensation Best Practices
3336

Independent Compensation Consultant
3437

Compensation Program
3437

Security Ownership Requirements
3638

Equity-Based Awards
36

Equity-Based Awards
38
Employment Agreements in Effect for 20120722
3640

Discussion of NEO Compensation
4043

2018 Developments
42

2023 Developments
46
4447

4548

Potential Payments upon Termination or Change of Control Summary
4951

Pay Ratio Disclosure
53
Director Compensation
5354

Pay versus Performance
55
5457

5558

5659

5760

5861

Stockholder Proposals, Director Nominations and Other Items of Business
5962

6063

6164



1 MERITAGE HOMES| 2018 Proxy Statement

MERITAGE HOMES | 2023 Proxy Statement 1
PROXY SUMMARY


MERITAGE HOMES CORPORATION
8800 EAST RAINTREE DRIVE
SUITE 300
SCOTTSDALE, ARIZONA 85260
(480) 515-8100
www.meritagehomes.com
Proxy Summary
This summary highlights selected information contained elsewhere in this proxy statement and is not intended to contain all of the information that you should consider. Please read the entire proxy statement carefully before voting.

General Information
Proxy Statement Purpose
The Board of Directors ("the Board") of Meritage Homes Corporation (“Meritage”, "we" or the “Company”) is furnishing this Proxy Statement to solicit your proxy for our 20182023 Annual Meeting of Stockholders. This Proxy Statement contains information to help you decide how you want your shares to be voted. To understand the proposals fully, you should carefully read this entire proxy statement and the other proxy materials identified in the Important Notice of InternetRegarding the Availability of Proxy Materials for the Shareholder Meeting to be held on May 18, 2023 ("the Notice"). This proxy statement will be available on the Internet,our website, and the Notice will be mailed to stockholders beginning on or about April 2, 2018.3, 2023.
Date, Time and PlaceAnnual Meeting of MeetingShareholders
The annual meeting will be held on Thursday, May 17, 2018, at 8:30 a.m. local time at our corporate office at 8800 East Raintree Drive, Suite 300, Scottsdale, Arizona, 85260. If you require directions to the annual meeting, please call (480) 515-8100.
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May 18, 2023
8:30 a.m. Pacific Time
The meeting will be completely virtual and conducted via live audio webcast. You will be able to attend the meeting by first registering at https://viewproxy.com/meritage/2023/.Record Date:
March 23, 2023
Who Can Vote
Stockholders who hold shares of our common stock at the close of business on March 21, 2018,23, 2023, the record date, will be entitled to one vote for each share held regarding each of the matters proposed in this proxy statement. Only holders of record of common stock at the close of business on the record date will be permitted to vote, either prior to the meeting or at the meeting, either in person or by valid proxy.virtual meeting. On the record date, there were 40,630,06636,765,267 shares of Meritage common stock outstanding. The common stock is our only outstanding class of voting securities.
Voting Information
You can vote in personelectronically at the annual meetingvirtual Annual Meeting or submit a proxy prior to the meeting to have your shares represented without attending the annualvirtual meeting. The shares represented by a properly executed proxy will be voted as you direct. To submit a proxy, you must follow the instructions provided in this proxy statement and in the Notice. You may submit your proxyvote via the Internet, regular mail or by calling the telephone number provided in the Notice, and you will be asked to enter your 11- or 12-digit control number. If you request a printed copy of these materials, you may also fillvote by filling out and signsigning the proxy or voting instruction card enclosed therein and returnreturning it by mail in the envelope provided. Please make your request for a copy as instructed in the Notice on or before May 10, 2023 to facilitate timely delivery.
If you submit a signed proxy but do not indicate any voting instructions, your shares will be voted FOR the election as directors of the director nominees named in this proxy statement, FOR the ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for fiscal 2018,2023, FOR the advisory vote to approve the compensation of our named executive officers, 1 YEAR for the frequency of future advisory votes on Say on Pay, and FOR the adoption ofamendment to our 2018 Stock Incentive Plan. to increase the number of shares authorized for issuance.
You can revoke your proxy any time before it is voted by written notice delivered to the Company’s Secretary, by timely delivery of a later signed proxy (including via the Internet, regular mail, or telephone), or by voting in personelectronically at the annualvirtual meeting.
2 MERITAGE HOMES| 2023 Proxy Statement
PROXY SUMMARY

Attendance at the virtual meeting alone is not sufficient to revoke your proxy. You must also vote your shares to revoke your proxy.

MERITAGE HOMES | 2018 Proxy Statement 2
PROXY SUMMARY

Holders of Record and Beneficial Owners
If your shares are registered directly in your name with our transfer agent, you are considered the “holder of record” of those shares.
If your shares are held in a brokerage account or by another nominee, you are considered the “beneficial owner” of shares held in “street name,” and the Notice is being forwarded to you by your broker or nominee (the “record holder”) along with a voting instruction card. As the beneficial owner, you have the right to direct your record holder regarding how to vote your shares, and the record holder is required to vote your shares in accordance with your instructions.
Record Holders and Beneficial Owners
As the holder of record or beneficial owner of shares, you are invited to attend the annual meeting.virtual Annual Meeting. Please note, however, that if you are a beneficial owner, you may not vote your shares in personelectronically at the virtual meeting unless you obtain a “legal proxy” from the record holder that holds your shares. Instructions for requesting the "legal proxy" from the record holder will be mailed to beneficial owners.
Rules of the New York Stock Exchange (the “NYSE”) determine whether proposals presented at stockholder meetings are “routine” or “non-routine.” If a proposal is routine, a broker or other entity holding shares for a beneficial owner in street name may vote on the proposal if you do not provide voting instructions. If a proposal is non-routine, the broker or other entity may vote on the proposal only if the beneficial owner has provided voting instructions. A “broker non-vote” occurs when the broker or other entity is unable to vote on a proposal because the proposal is non-routine and the beneficial owner does not provide instructions. If you are a beneficial owner and do not give instructions to your record holder prior to the meeting, the record holder will be entitled to vote your shares in its discretion only on Proposal 2 (Ratification of Independent Registered Public Accounting Firm) and will not be able to vote your shares on Proposal 1 (Election(Election of Directors), Proposal 3 (Advisory Vote to Approve Compensation of our Named Executive Officers), Proposal 4 (Advisory Vote on the Frequency of Future Advisory Votes on Say on Pay), or Proposal 4 (Approval of5 (Amendment to our 2018 Stock Incentive Plan), and your shares will be treated as a “broker non-vote”non-vote” on those proposals.
Quorum
The presence in personvirtually or by proxy of stockholders representing a majority of the votes entitled to be cast at the meeting is necessary to constitute a quorum at the meeting. Abstentions and broker non-votes are counted as present for purposes of determining whether a quorum exists.

The Proposals
The following four proposals will be considered at the Annual Meeting:
Proposal
Board Vote
Recommendation
Page Number
1Election of DirectorsFOR Each Director6
2Ratification of Independent Registered Public Accounting FirmFOR7
3Advisory Vote to Approve Compensation of our Named Executive OfficersFOR8
4Adoption of our 2018 Stock Incentive PlanFOR10
PROPOSAL 1The Proposals
The following five proposals will be considered at the Annual Meeting:
ProposalBoard Vote
Recommendation		Page Number
1Election of DirectorsFOR Each Nominee6 
2Ratification of Independent Registered Public Accounting FirmFOR7 
3Advisory Vote to Approve Compensation of our Named Executive OfficersFOR8 
4Advisory Vote on the Frequency of Future Advisory Votes on Say on PayONE YEAR10 
5Approval of Amendment to our 2018 Stock Incentive Plan to Increase the Authorized Number of Shares Available for IssuanceFOR11 
PROPOSAL 1
Election of Directors
Each Class III director nominee is up for election for a two-year term.term. Each director nominee iswas a current director and during 20172022 and attended at least 75% of the aggregate of all meetings of the Board and of all Board committees on which he sits.they serve.
Name Age Director Since Independent AC CC NGC LC
Raymond Oppel 61 1997 Yes   C   ü
Steven J. Hilton 56 1997 No        
Richard T. Burke, Sr. 75 2004 Yes ü      
Dana C. Bradford 53 2009 Yes ü ü   ü
Deb Henretta 56 2016 Yes     ü  
NameClassAgeDirector SinceIndependentACCCNGCLCES&S
Peter L. AxII632000YesCüü
Gerald HaddockII752005YesCü
Joseph KeoughII532019Yesüü
Phillippe LordII492021No
Michael R. OdellII592011YesC
C=Committee ChairACAudit CommitteeNGCNominating/Governance CommitteeES&SEnvironmental, Social and
   Sustainability Committee
ü=MemberCCExecutive Compensation CommitteeLCLand Committee

3 MERITAGE HOMES| 20182023 Proxy Statement3
PROXY SUMMARY


PROPOSAL 2
Ratification of Independent Registered Public Accounting Firm
Ratify the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the 20182023 fiscal year.
 Summary of Fees Summary of Fees
 2017 2016 20222021
Audit fees $1,080,000
 $1,151,500
Audit fees$1,225,000 $1,172,500 
Audit-related fees —
 —
Audit-related fees— — 
Tax fees —
 —
Tax fees— — 
All other fees —
 —
All other fees— — 
Total fees $1,080,000
 $1,151,500
Total fees$1,225,000 $1,172,500 

PROPOSAL 3
Advisory Vote to Approve Compensation of our Named Executive Officers
Stockholders will be given the opportunity to vote on an advisory resolution to approve the compensation of our Named Executive Officers (“NEOs”) (commonly referred to as “Say on Pay”).
Our executive compensation program is designed to drive and reward superior corporate performance, both annually and over the long-term. The Board believes the Company’s compensation policies and practices are effective in achieving the Company’s goals of paying for performance and aligning the NEO's long-term interests with those of our stockholders.
Compensation elements for our NEOs include:
TypeFormTerms
CashBase SalaryCompetitively market-basedmarket-based.
CashAnnual Incentive CompensationBased on achievement of performance goals that align with the Company's annual objectives.
CashDiscretionary BonusesBased on specific individual achievements beyond those of the performance goals included in the annual incentive compensation calculations,program, subject to approval by the Executive Compensation CommitteeCommittee. Our long-standing practice is to limit discretionary payments.
EquityLong-term Incentive AwardsEquity awards typically haveinclude a three-year service periodmix of time-based awards and performanceperformance-based awards, both of which vest on the third anniversary of the date of grant. Performance-based awards are earned based on goals thataligned with the Company's long-term strategy and which span over a combination of a three-year cumulative period or three one-year measurement periods.
OtherLimited PerquisitesPrimarily auto allowance and the reimbursement of certain life and disability (or equivalent) policies for the benefit of NEOs and their families and auto allowance for certain NEOs.

PROPOSAL 4
AdoptionAdvisory Vote on the Frequency of Future Advisory Votes on Say on Pay
Stockholders will be given the opportunity to vote on an advisory resolution regarding the frequency of future advisory votes on Say on Pay. As required by applicable SEC rules, we are again asking stockholders to indicate their preference for how frequently we conduct advisory Say on Pay votes. Consistent with the opinion of many investors, the Board believes our stockholders should be able to express their approval or disapproval of the compensation of our NEOs every year.

PROPOSAL 5
Amendment to our 2018 Stock Incentive Plan to Increase the Number of Shares Available for Issuance
Stockholders will be given the opportunity to vote on a proposal to approve the adoption ofadditional shares to be authorized under our 2018 Stock Incentive Plan.
Shares currently available for future awards under our 20062018 Stock Incentive Plan (as of March 22, 2018)23, 2023)487,809 597,164
SharesAdditional shares to be authorized under our 2018 Stock Incentive Plan800,000 1,250,000
Total proposed shares to be available including 2018 Stock Incentive Plan1,287,809 1,847,164

4 MERITAGE HOMES| 20182023 Proxy Statement 4
PROXY SUMMARY


Other Matters
The management and Board of Directors of the Company know of no other matters to be brought before the meeting. If other matters are properly presented to the stockholders for action atduring the meeting or any adjournments or postponements thereof, it is the intention of the proxy holders named in this proxy to vote in their discretion on all matters on which the shares of common stock represented by such proxy are entitled to vote. The entire cost of this solicitation of proxies will be borne by the Company, including expenses incurred in connection with preparing, assembling and mailing the Notice. The Company may reimburse brokers or persons holding stock in their names or in the names of their nominees for their expenses in sending the proxy materials to beneficial owners who request paper copies. Certain officers, directors and regular employees of the Company, who will receive no extra compensation for their services, may solicit proxies by mail, telephone, facsimile, emailelectronically or personally.
Corporate Governance
Meritage operates within a comprehensive plan of corporate governance for the purpose of defining responsibilities and setting high standards for ethical conduct. Our Board of Directors has established the following governance committees:
—Audit Committee
—Executive Compensation Committee ("Compensation Committee")
—Nominating/Governance Committee
—Land Committee
—Environmental, Social and Sustainability Committee ("ES&S Committee")
The charter of each of these committees is available on our website, along with our Lead Director Charter, Code of Ethics, Corporate Governance Principles and Practices, Conflict of Interest and Related Party Transaction Policy, Securities Trading Policy, Human Rights Policy, Vendor Code of Conduct, Environmental Responsibility Policy and Responsible Marketing Policy. These items are also available in print, free of charge, to any stockholder who requests them by calling us or by writing to us at our principal executive offices at the address listed previously in this proxy statement, Attention: Secretary.


5 MERITAGE HOMES| 2018 Proxy Statement

MERITAGE HOMES | 2023 Proxy Statement 5
PROPOSAL 1: ELECTION OF DIRECTORS

Election of Directors
(Proposal No. 1)
Our Board of Directors currently has nineeleven members. The directors are divided into two classes serving staggered two-year terms. This year, our Class III directors are up for election. The Board, upon the recommendation of the Nominating/Governance Committee, has nominated for re-election Raymond Oppel, Steven J. Hilton, Richard T. Burke, Sr., Dana C. BradfordPeter L. Ax, Gerald Haddock, Joseph Keough, Phillippe Lord, and Deb Henretta,Michael R. Odell, all of whom are presently serving as Class III directors.
Biographical information for each of our director nominees is set forth beginning on page 21.20.
All nominees have consented to serve as directors. The Board of Directors has no reason to believe that any of the nominees will be unable to act as a director. However, should a nominee become unable to serve or should a vacancy on the Board occur before the annual meeting, the Board may either reduce its size or designate a substitute nominee. If a substitute nominee is named, your shares will be voted for the election of the substitute nominee designated by the Board. In the vote on the election of the director nominees, stockholders may vote FOR, AGAINST, or ABSTAIN for each director.
Unless you elect to vote differently by so indicating on your signed proxy, your shares will be voted FOR the Board’s nominees. To be elected a director, a director nominee must receive the affirmative vote of the majority of the votes cast, meaning, that the number of votes cast "for" a director nominee must exceed the number of votes "against" that director nominee. Any nominee for director who is an incumbent director but who is not elected by a majority of the votes cast, and with respect to whom no successor has been elected, will promptly tender his or her offer to resign to the Board of Directors for its consideration. The Nominating/Governance Committee of the Board of Directors will recommend to the Board of Directors whether to accept or reject the resignation offer, or whether other action should be taken. Broker non-votes and abstentions will not count as either votes for or against the nominee.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF THE ABOVE-NAMED NOMINEES AS DIRECTORS.


MERITAGE HOMES | 2018 Proxy Statement 6

6 MERITAGE HOMES| 2023 Proxy Statement
PROPOSAL 2: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Ratification of Independent Registered Public Accounting Firm
(Proposal No. 2)
The Board of Directors seeks an indication from stockholders of their approval or disapproval of the Audit Committee’s appointment of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal 2018.2023.
Deloitte & Touche LLP was appointed our auditor in 2004 and no relationship exists between the Company and Deloitte & Touche LLP other than the usual relationship between auditors and clients.
An affirmative vote of the majority of the votes cast at the annual meeting, at which a quorum is present, is required to ratify the selection of Deloitte & Touche LLP as the Company’s independent auditor. Abstentions will not be counted either for or against this proposal. If the appointment of Deloitte & Touche LLP as auditors for 20182023 is not approved by stockholders, the adverse vote will be considered a direction to the Audit Committee to consider other auditors for next year. However, because of the difficulty in making any substitution of auditors after the beginning of the current year, the appointment in 20182023 will stand, unless the Audit Committee determines there is a reason for making a change. In addition, even if the appointment is ratified, the Audit Committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interest of the Company and our stockholders.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” PROPOSAL NO. 2.


7 MERITAGE HOMES| 2018 Proxy Statement

MERITAGE HOMES | 2023 Proxy Statement 7
PROPOSAL 3: ADVISORY VOTE TO APPROVE COMPENSATION OF OUR NAMED  EXECUTIVE OFFICERS





Advisory Vote to Approve Compensation of our Named Executive Officers
(Proposal No. 3)
Stockholders will be given the opportunity to vote on the following advisory resolution (commonly referred to as “Say"Say on Pay”Pay"):
RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed herein pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion is hereby APPROVED.

Background on Proposal
In accordance with the Dodd-Frank Act and related SEC rules, stockholders are being given the opportunity to vote at the annual meeting on this advisory resolution regarding the compensation of our NEOs.
At our 2017 Annual Meeting of Stockholders, the Company’s stockholders approved the compensation of our NEOs (on an advisory basis) by approximately 96% of total votes cast. We believe this high approval rating indicated that our stockholders were in agreement with the direction of our Executive Compensation Committee of setting competitive compensation arrangements based on criterion believed to be both in line with the goals of our stockholders and at levels that are reasonable in relation to the Company’s performance and size. In addition, at our 2017 Annual Meeting of Stockholders, the Company's stockholders indicated, on an advisory vote basis, that they preferred that we hold Say on Pay votes on an annual basis (a say on frequency vote is required to be held at least once every six years). This Proposal No. 3 represents this year’s Say on Pay vote.
At our 2022 Annual Meeting of Stockholders (the "2022 Meeting"), the Company’s stockholders approved the compensation of our NEOs (on an advisory basis) by approximately 58% of total votes cast, a level of stockholder approval that was notably lower than in prior years. Subsequent to the 2022 Meeting, we sought to engage with our top 30 institutional stockholders, who accounted for over 73% of our total shares outstanding at December 31, 2022. Seven of the top 30 stockholders, over half of whom voted against the 2022 Say on Pay and whose shares represented 47% of the top 30 ownership, welcomed a conversation with members of our Board and executive management. They generally expressed that their negative votes were reflective of the one-time non-recurring payment in 2021 to our former NEO and General Counsel, C. Timothy White, upon his retirement. We accept the feedback from our stockholders. No such payments were paid during 2022, and none are contemplated to be paid in any future period. We will continue to limit discretionary payments and incorporate the expectations of stockholders when structuring or negotiating severance payments and benefits. As our Say on Pay support has exceeded 90% of the votes cast for the ten years prior to the 2022 Annual Meeting, the Board's goal is to return to this high level of support from our stockholders on the Say on Pay proposal at this year's annual meeting and beyond. Please refer to our Compensation Discussion and Analysis in this proxy statement beginning on page 29 for additional information regarding our stockholder outreach.
Our Board believes that our executive compensation pay practices remain disciplined, measured, and responsible, and have been recognized as such in prior years, including 2021, outside of the one-time payment to Mr. White. In fact, apart from the one-time payment, the stockholders that we engaged with generally expressed that all other NEO compensation structures and amounts were acceptable. Since we do not anticipate any payments outside of the existing compensation structures for our NEOs in future periods, we believe that concerns over this one-time non-recurring compensation event should be alleviated for the current and future years. Additionally, we will continue to make our executive compensation plan transparent and easy to understand.
Our Board and the Compensation Committee remain committed to a prudent approach to consider future executive employment agreements and other executive compensation arrangements. Maintaining our fair pay for performance culture that our stockholders have come to expect is paramount to attracting, retaining and motivating executives.
For a comprehensive description of our executive compensation program, philosophy and objectives, including the specific elements of executive compensation that comprised the program in 2017,2022, please refer to the Compensation Discussion and Analysis section of this proxy statement. The Summary Compensation Table on page 47, and other executive compensation tables (andand accompanying narrative disclosures)disclosures that follow it, beginning on page 45, provideprovides additional information about the compensation that we paid to our NEOs in 2017.2022. As described in the Compensation Discussion and Analysis, our executive compensation program is designed to drive and reward superior performance both annually and over the long term while simultaneously striving to be externally competitive. During 2017, through
Building on the combined effortsunprecedented growth in 2020 and 2021, the homebuilding industry continued to expand in the first half of our NEOs, Meritage was successful in generating year-over-year2022. However, rapid increases in manyinterest rates, inflation and a general deterioration in the economy cooled demand in the latter half of the year. Supply chain constraints, labor shortages and rising commodities costs that began in 2020 and 2021 also continued to persist throughout 2022. Our NEO's and management team successfully navigated the rapidly changing environment, increasing incentives and offering interest rate locks and buy downs to offset the increasing monthly mortgage payments for our customers, resulting in strong operational and financial performance in 2022, including our highest annual home closings, in both units and value, highest diluted EPS and our highest ever gross margin. Meritage's year-over-year results for certain key operating metrics follow (dollars in thousands):
8 MERITAGE HOMES| 2023 Proxy Statement
  2017 2016 % Change
Home Closing Units 7,709
 7,355
 4.8%
Home Closing Revenue $3,186,775
 $3,003,426
 6.1%
Home Order Units 7,957
 7,290
 9.1%
Home Order Value $3,296,788
 $3,001,503
 9.8%
Backlog Units at period end 2,875
 2,627
 9.4%
Backlog Value at period end $1,245,771
 $1,135,758
 9.7%
Pre-Tax Income $247,519
 $218,060
 13.5%
Diluted Earnings per Share (1)
 $3.41
 $3.55
 (3.9)%
(1)
Includes a $19.7 million charge related to the revaluation of our deferred tax asset that reflects the impact of a lower corporate tax ratePROPOSAL 3: ADVISORY VOTE TO APPROVE COMPENSATION OF OUR NAMED  EXECUTIVE OFFICERS
enacted by the Tax Cuts and Jobs Act in December 2017 and effective beginning in 2018.
20222021Change
Home Closing Units14,106 12,801 10.2%
Home Closing Revenue$6,207,498 $5,094,873 21.8%
Home Order Units11,759 13,808 (14.8)%
Home Order Value$5,255,600 $5,796,813 (9.3)%
Backlog Units at period end3,332 5,679 (41.3)%
Backlog Value at period end$1,524,775 $2,516,164 (39.4)%
Home Closing Gross Margin28.6 %27.8 %80 bps
Selling, general and administrative expenses (as a percentage of home closing revenue)8.3 %9.2 %(90) bps
Earnings Before Income Taxes$1,289,318 $954,834 35.0%
Diluted Earnings per Common Share$26.74 $19.29 38.6%

The Executive Compensation Committee continually evaluates the compensation packages for our NEOs and adjusts them annually or as conditions warrant, including setting performance targets for both cash and equity awards, some of which have been forfeited in casesprevious years where performance targets were not met. Since 2013, the ExecutiveThe Compensation Committee has engagedengages an external compensation consultant annually regarding the design of our executive compensation program. The Company over the last several years (inclusive of the most recent updates) has implemented prudent and responsible compensation policies in the stockholders’ interest, some of which include:
•A substantial portion of compensation is incentive basedincentive-based and is "at-risk", as discussed beginning on page 34.33.
Incentive•Incentive-based compensation is balanced between cash and equity awards, as discussed beginning on page 34.33.
•The employment agreements for our CEO and our NEOs include a provision for the clawback (or offset) of incentive bonuses to the extent any financial results are misstated as the result of the NEO’s willful misconduct or gross negligence.

MERITAGE HOMES | 2018 Proxy Statement 8
PROPOSAL 3: ADVISORY VOTE TO APPROVE COMPENSATION OF OUR NAMED  EXECUTIVE OFFICERS




•NEOs must comply with securitystock ownership requirements, as discussed on page 36.37.
•Perquisites are limited to auto allowances and reimbursement of certain life and disability or long-term care insurance premiums, and limited other benefits as discussed on page 39.41.

Effects of Advisory Vote
Because the vote on this proposal is advisory in nature, it will not affect any compensation already paid or awarded to our NEOs and will not be binding on the Board of Directors or the Executive Compensation Committee. However, the Executive Compensation Committee will consider the outcome of the vote when making future executive compensation decisions.
An affirmative vote of a majority of the votes cast at the annual meeting, at which a quorum is present, is required to approve this advisory vote. Broker non-votes and abstentions have no effect on the result of the vote.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE “FOR” APPROVAL OF THE RESOLUTION SET FORTH ABOVE TO APPROVE THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS


9 MERITAGE HOMES| 20182023 Proxy Statement9
PROPOSAL 4: ADVISORY VOTE ON THE FREQUENCY OF FUTURE ADVISORY VOTES ON SAY ON PAY
Advisory Vote on the Frequency of Future Advisory Votes on Say on Pay
(Proposal No. 4)
Stockholders will be given the opportunity to vote on the following advisory resolution:
RESOLVED, that the stockholders shall be given the opportunity to vote on an advisory resolution regarding the compensation of the Company's named executive officers (vote for one alternative only):
•every year
•every two (2) years; or
•every three (3) years.

Background on Proposal
In accordance with the Dodd-Frank Act and related SEC rules, stockholders are being given the opportunity to vote at the annual meeting on an advisory resolution regarding the compensation of our NEOs. See Proposal 3 beginning at page 8. The Dodd-Frank Act and applicable SEC rules also require that, at least once every six years, stockholders be given the opportunity to vote on the advisory resolution set forth above regarding the frequency of future stockholder advisory votes on Say on Pay. Our last vote on the frequency of future Say on Pay votes on the compensation of the Company’s NEOs was held at the Company’s 2017 Annual Meeting of Stockholders and, accordingly, we are asking stockholders at this year’s Annual Meeting of Stockholders to vote on an advisory resolution regarding the frequency of future stockholder votes on Say on Pay.
Stockholders may vote to recommend that future Say on Pay votes be held every year, every two years or every three years. After careful consideration of this Proposal No. 4, our Board of Directors has determined that an advisory vote on executive compensation that occurs every year is the most appropriate alternative for us, and therefore our Board of Directors recommends that you vote for an annual advisory vote on executive compensation. In formulating its recommendation, our Board of Directors considered that an annual advisory vote on the compensation of our named executive officers will provide our stockholders with direct and timely input on our executive compensation.
The frequency option (i.e. every year, every two years or every three years) that receives a plurality of the votes cast on this proposal will be deemed the recommended option of stockholders. Broker non-votes and abstentions will have no effect on the result of the vote.

Effects of Advisory Vote
Because the vote on this proposal is advisory in nature, it will not be binding on the Board of Directors. If stockholders vote on a plurality basis for holding Say on Pay Votes annually, the Board of Directors will continue to conduct a Say on Pay vote each year. If stockholders indicate a preference for holding a Say on Pay vote less frequently than every year, the Board of Directors will consider the outcome of the vote along with other factors when making its decision about the frequency of future advisory Say on Pay votes.
THE BOARD UNANIMOUSLY RECOMMENDS THAT YOU VOTE IN FAVOR OF HOLDING FUTURE STOCKHOLDER ADVISORY VOTES ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS EVERY YEAR.


10 MERITAGE HOMES| 2023 Proxy Statement
PROPOSAL 4: ADOPTION OF5: AMENDMENT TO OUR 2018 STOCK INCENTIVE PLAN


Approval ofAmendment to our 2018 Stock Incentive Plan (Proposal 5)
(Proposal No. 4)5)
General
On March 23, 2018, ourThe Board of Directors adopted, subject to stockholder approval,has reviewed the Meritage Homes Corporationshares currently available under the 2018 Stock Incentive Plan (the “2018 Plan”"2018 Plan"). If approved by our stockholders, and has determined that it is appropriate to increase the 2018 Plan will become effective as of the date of this annual meeting (“Effective Date”). Except as set forth in Section 5 of the 2018 Plan, the establishment of the 2018 Plan is not intended to have any effect on the 2006 Stock Incentive Plan (the "2006 Plan") or any similar prior plan and the Executive Compensation Committee (the “Compensation Committee”) may continue to make awards under the 2006 Plan and any prior plan, in accordance with their respective plan terms, after the Effective Date.
Some key differences between the 2018 Plan and the 2006 Plan include the following:
The totalmaximum number of shares authorized for issuance under the 2018 Plan is 1,250,000. Based on current grant practices, we believe the 2018 Plan will provide the Compensation Committee with sufficientPlan. As of March 23, 2023, restricted stock units representing 760,194 shares for grants through approximately 2020.
Unless sooner terminated, the 2018 Plan carries a 10 year term and will expire on May 17, 2028.
The Tax Cuts and Jobs Act of 2017 significantly changed Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) for tax years beginning after December 31, 2017, making certain provisions that have historically appeared in our equity plans superfluous. Although the 2018 Plan still allows the Compensation Committee to grant awards that vest based on the attainment of performance goals, the 2018 Plan generally does not include provisions that are no longer needed in light of the changes to Section 162(m) of the Code.
The 2018 Plan clarifies that the full board (rather than the Compensation Committee) is responsible for the administration of the 2018 Plan with respect to non-employee director awards.
The 2018 Plan provides that, during any 12 month period, the maximum value of awards madewere outstanding under the 2018 Plan to any non-employee director less any cash fees paid to such individual over the same 12 month period shall not exceed $750,000.
The 2018 Plan eliminates the fungible design that appeared in the 2006 Plan whereby stock options and stock appreciation rights reduced the number of shares reserved for grant under the 2006 Plan by one share for each share subject to the option or stock appreciation right and 1.38 shares for each share subject to an award other than a stock option or stock appreciation right.  Under the 2018 Plan, all awards will reduce the share pool on a one-for-one basis.
Plan. As of March 22, 2018, the Board of Directors believes23, 2023, the total number of shares of common stock available for awards under the 2006 Plan (outlined inis 487,809, which the table below)Board believes is inadequate for the purpose of providing future equity incentivesincentives. The Board has determined that increasing the amount of shares of common stock issuable under the 2018 Plan is necessary in order to recruit, hirebe able to grant additional equity awards to continue to retain and retainmotivate key employees. When reviewing the talent requirednumber of shares available in the Plan, the Board receives a full analysis prepared by the Company's proxy advisor to successfully execute our business plans.ensure the number of additional shares being proposed is in alignment with stockholder guidelines. Our goal is to maintain up to a five year supply of shares available for grant, while not dropping below a two year supply. As a result, the Board of Directors is asking the stockholders to approve the adoption ofan amendment to the 2018 Plan resulting inthat would increase the number of shares authorized for issuance by 800,000 from 1,250,000 to 2,050,000.
The Board believes the 2018 Plan promotes success and enhances our value because it ties the personal interests of the participants to those of stockholders and provides the participants with an additional 1,250,000 shares available for grant for future equity incentive awards.
Number of Shares Available For Future Awards Under 2006 Plan (does not include shares being requested under 2018 Plan)Number of Options and Awards OutstandingWeighted Average Remaining Term of Outstanding Options and AwardsShares Awarded Under 2006 Plan
597,1641,383,1222.994,752,836
to increase stockholder value. In reaching our conclusion as to the total numberappropriateness of shares available for grant under the 2018 Plan,additional share proposal, we reviewed key metrics that are typically used to evaluate such requests. Investors typicallyproposals. Many investors use a burn rate calculation in order to quantify how quickly a company uses its shareholder capital. Meritage has a three-year burn rate of 3.09%, below the industry cap set by a major proxy advisory firm for our industry (consumer durables and apparel) of 3.80%. This burn rate assumes a 2.5x weighting for restricted stock grants. Our unweighted burn rate is 1.24%0.86%. Additionally, many investors also look at voting power dilution to assess the effect that shares will have on dilution. As of December 31, 2017, fullFull voting power dilution of all outstanding awards and authorizedavailable shares, together withincluding the 1,250,000 requested800,000 additional shares added under the 2018 Plan as of December 31, 2022, would yield an 8.38%a 5.26% dilution for Meritage, which is well below our industry classification median.

MERITAGE HOMES | 2018 Proxy Statement 10
PROPOSAL 4: ADOPTION OF OUR 2018 STOCK INCENTIVE PLAN


In addition to the responsible approach to equity plan share usage described above, the 2018 Plan includes a number of provisions that the Board of Directors believe are consistent with current best practices and sound governance principles including:

A prohibition on liberal share counting/share recycling.
A prohibition on the repricing of stock options and stock appreciation rights without shareholder approval.
A prohibition on the grant of stock options and stock appreciation rights with discounted exercise prices.
The 2018 Plan does not contain a liberal definition of change of control.
Requires, as a general rule, that no portion of any award will vest prior to the 12-month anniversary of the date of grant.
A prohibition on the payment of dividend equivalents for any dividend equivalent granted in connection with any award that vests based on the achievement of performance goals, unless and until the underlying award vests or is earned by satisfaction of the applicable performance goals.
The 2018 Plan includes a non-employee director sublimit that limits the maximum value of awards and cash compensation that may be granted to any one non-employee director during any one 12 month period.
The 2018 Plan does not include an “evergreen” or similar provision that provides for automatic share replenishment.
The 2018 Plan provides that every award issued under the 2018 Plan will be subject to potential clawback or recapture to the fullest extent required by law or Company policy.
Certain material features of the 2018 Plan are discussed below, howeverand the descriptionfull document is subject to, and qualified by theavailable on our website at investors.meritagehomes.com. The full text of the of the 2018 Planamendment is attached as Appendix A. The closing price for our common stock on March 22, 2018,23, 2023, as reported on the NYSE, was $45.20$113.45 per share. If the 2018 Plan is approved, we anticipate filing a Form S-8 registration statement with the SEC shortly after the annual meeting to register the shares authorized for issuance under the 2018 Plan.
additional shares.
Administration
The 2018 Plan is administered by the Compensation Committee. The Compensation Committee has the authority to interpret and administer the 2018 Plan in order to carry out the purposes of the 2018 Plan. The Compensation Committee has the authority to determine those persons eligible to receive awards, the number of shares subject to an award and to establish and interpret the terms and conditions of any awards. The Compensation Committee may also make exceptions to the provisions of any awards. All determinations of the Compensation Committee are final and binding. In the case of awards made to non-employee directors, the Board, and not the Compensation Committee, shall administer the 2018 Plan.
Eligibility
Awards may be made to any officer, employee or executive of the Company, as well as to non-employee directors and consultants or advisors to the Company. Prospective non-employee directors and employees may also be granted awards but no portion of such awards shall vest, become exercisable, be issued, or become effective prior to the date on which such individual begins to provide services to the Company. As of December 31, 2017,2022, there were eightnine non-employee directors and approximately 1,600121 officers employees and non-employee consultantsemployees of the Company and its subsidiaries eligible to participate in the 2018 Plan.

Shares Subject to Plan; Individual Sublimits
The total number of shares of stock available for grant under the 2018 Plan is 1,250,000, plus the number of shares of stock that were authorized but unissued under theour prior 2006 Stock Incentive Plan and all Prior Plansother prior plans as of May 13, 2019. The total number of shares available will be reduced by one share for each share issued. If any award granted under the 2018 Plan terminates, expires, or lapses for any reason, or is paid in cash, any stock subject to or surrendered for such award will again be stock available for the grant of an award under the 2018 Plan. The exercise of a stock-settled SAR,stock appreciation right ("SAR"), or broker-assistedbroker- assisted “cashless” exercise of an option (or a portion thereof) will reduce the number of shares of stock available for grant under the 2018 Plan by the entire number of shares of stock subject to that SAR or option (or applicable portion thereof), even though a smaller number of shares of stock will be issued upon such an exercise. Also, shares of stock

11 MERITAGE HOMES| 2018 Proxy Statement
PROPOSAL 4: ADOPTION OF OUR 2018 STOCK INCENTIVE PLAN


tendered to pay the exercise price of an option or tendered or withheld to satisfy a tax withholding obligation arising in connection with an award will not again become available for use under the 2018 Plan.
MERITAGE HOMES | 2023 Proxy Statement 11
PROPOSAL 5: AMENDMENT TO OUR 2018 STOCK INCENTIVE PLAN
The maximum number of shares of stock subject to incentive stock options under the 2018 Plan is 1,250,000.The1,250,000. The maximum number of shares of stock that may be granted to any one participant during any 12-month period with respect to one or more awards is 200,000. The maximum value of awards granted to any one participant who is a non-employee director during any 12-month period is $750,000 less any retainer fees, lead director fees, meeting fees or other fees paid to such individual as compensation for their Board service during such 12-month period.
Type of Awards

The Plan allows for grants of stock options, stock appreciation rights, restricted stock, performance shares, and restricted stock units (each, an “Award”), whether granted alone or in combination, pursuant to which shares of common stock, cash or a combination thereof may be delivered to the Award recipient.

Options. An option is the right to purchase shares of common stock at a future date at a specified exercise price. The Compensation Committee may grant both nonqualified stock options and incentive stock options under the Plan. The per share exercise price will be determined by the Compensation Committee but must be at least equal to the fair market value of the underlying shares of common stock on the date of grant. The Compensation Committee determines the date after which options may be exercised in whole or in part and the expiration date of each option, which cannot be more than 10 years from the date of grant. However, in the case of an incentive stock option granted to a participant who holds more than 10% of the voting power of the Company, the exercise price must be at least 110% of the fair market value of the underlying shares of common stock on the date of grant and the expiration date cannot be more than five years from the date of grant. The exercise price of an option may be paid in shares of common stock, cash or a combination thereof, as determined by the Compensation Committee, including an irrevocable commitment by a broker to pay the exercise price from the proceeds of a sale of shares issuable under the option, the delivery of previously owned shares or withholding of shares deliverable upon exercise. Options cannot, without stockholder approval, be repriced, cancelled and regranted at a lower exercise price, or repurchased for cash, other than in connection with a change in the Company’s capitalization. As a general rule, if a participant incurs a termination of employment on account of disability or death before an option lapses, except as may be provided in a participant's employment agreement, the option shall lapse, unless it is previously exercised, on the earlier of: (i) the scheduled termination date of the option; or (ii) 12 months after the date of the participant’s termination of employment on account of death or disability.

Stock Appreciation Rights. A stock appreciation right is a right to receive the appreciation in value of one share of common stock of the Company. Appreciation is calculated as the excess of (i) the fair market value of a share of stock on the date of exercise over (ii) the base value fixed by the Compensation Committee on the date of grant, which may not be less than the fair market value of a share of stock on the date of grant. Payment for SARs shall be made in cash, stock, or a combination thereof. The Compensation Committee determines the date after which options may be exercised in whole or in part and the expiration date of each option, which cannot be more than 10 years from the date of grant. Stock appreciation rights cannot, without stockholder approval, be repriced, cancelled and regranted at a lower exercise price, or repurchased for cash, other than in connection with a change in the Company’s capitalization.

Restricted Stock Awards.Awards of shares of stock may be granted under the Plan, although the shares are generally subject to a risk of forfeiture or to other conditions or restrictions for specified periods of time. The Compensation Committee does not typically issue a stock certificate representing a restricted stock award until the restrictions applicable to all or part of the award have lapsed, and the Compensation Committee has discretion to waive in whole or in part restrictions or forfeiture conditions relating to the restricted stock award.

Performance Share Awards. Performance share awards are rights to receive, cash, shares of common stock or a combination thereof, an amount equal to the value of common stock if certain performance goals are attained.

Restricted Stock Units. A restricted stock unit is a right to receive a specified number of shares of common stock in the future, at no monetary cost to the participant, the payment of which is subject to certain restrictions and the risk of forfeiture as determined by the Compensation Committee.

MERITAGE HOMES | 2018 Proxy Statement 12
PROPOSAL 4: ADOPTION OF OUR 2018 STOCK INCENTIVE PLAN


Treatment of Awards Upon Termination of Employment and Change of Control
The 2018 Plan provides that, except as may otherwise be provided in an award agreement or other written document, such as an employment agreement or a change of control agreement, if a change of control occurs and Awards are converted, assumed, or replaced by a successor, the Compensation Committee has the discretion to cause all outstanding Awards to become fully exercisable and all restrictions on outstanding Awards to lapse. If a change of control occurs and the Awards are not converted, assumed, or replaced by a successor, all outstanding Awards shall automatically become fully exercisable and all restrictions on outstanding Awards shall lapse. The 2018 Plan also permits an award agreement to provide accelerated vesting upon death, disability, change of control, retirement, termination for good reason or termination by the Company without cause.
Amendment to or Termination of The 2018 Plan
The Compensation Committee, with the Board’s approval, may amend, alter or discontinue the 2018 Plan. However, other than in connection with a change in the Company’s capitalization, no amendment may be made without stockholder approval if such amendment would:
12 MERITAGE HOMES| 2023 Proxy Statement
PROPOSAL 5: AMENDMENT TO OUR 2018 STOCK INCENTIVE PLAN
•increase the maximum number of shares of common stock for which Awards may be granted under the 2018 Plan;
•permit the Compensation Committee to grant options or stock appreciation rights with an exercise price or base value that is below the fair market value of a share of common stock on the date of grant;
•permit the Compensation Committee to extend the exercise period for an option or stock appreciation right beyond 10 years from the date of grant;
•permit the Compensation Committee to reprice or reduce the exercise price or base value of previously-granted options or stock appreciation right;
•expand the types of awards available for grant under the 2018 Plan;
•expand the class of individuals eligible to participate under the 2018 Plan; or
•require stockholder approval under any laws, regulation or stock exchange rule.
Minimum Vesting Requirement
The 2018 Plan imposes a minimum vesting requirement on Awards such that no portion of any Award shall vest prior to the 12-month anniversary of the date of grant. This minimum vesting requirement does not apply to 5% of the total number of shares reserved for grant under the 2018 Plan. Notwithstanding the foregoing, the Committee may include provisions calling for the accelerated vesting of an Award upon a change of control, death, disability, retirement, voluntary termination for good reason, or termination by the Company without cause.
Non-transferability
Unless otherwise determined by the Compensation Committee, no award granted under the 2018 Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will or by the laws of descent and distribution. Subject to the requirements set forth in the 2018 Plan, the Compensation Committee may permit the transfer of Awards to family members.
Clawback
Every award granted under the 2018 Plan is subject to potential forfeiture or recovery to the fullest extent called for by law, any applicable listing standard, or any current or future clawback policy that may be adopted by the Company from time to time, including, without limitation, any clawback policy adopted to comply with the final rules issued by the Securities and Exchange CommissionSEC and the final listing standards to be adopted by the NYSE pursuant to Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

13 MERITAGE HOMES| 2018 Proxy Statement
PROPOSAL 4: ADOPTION OF OUR 2018 STOCK INCENTIVE PLAN


Tax Withholding
The Company shall have the power to withhold, or require a participant to remit to the Company, up to the maximum amount necessary, in the applicable jurisdiction, to satisfy federal, state, and local withholding tax requirements on any Award under the 2018 Plan. To the extent that alternative methods of withholding are available under applicable laws, the Compensation Committee will have the power to choose among such methods including through the mandatory or elective sale of shares of common stock, by electing to have the Company withhold a portion of the shares that would otherwise be issued upon exercise of an Award or by tendering shares already owned by the participant.
Duration of The Plan
The Plan by its terms terminates on May 17, 2028.
Material U.S. Federal Tax Consequences
The following is only a summary of the material consequences of U.S. federal income taxation to the participant and the Company with respect to the grant and exercise of options under the Plan, provided in accordance with the requirements in Proxy Item 10(b)(2). The summary is not complete, does not discuss the income tax laws of any state or foreign country in which a participant may reside, and is subject to change. Participants in the Plan should consult their own tax advisors regarding the specific tax consequences to them of participating in and receiving options under the Plan.
Nonqualified Stock Options and Stock Appreciation Rights. Rights. Generally, a participant will not recognize income upon the grant of a nonqualified stock option or a stock appreciation right; instead, the holder of a nonqualified stock option or a stock appreciation right will recognize ordinary income at the time of exercise in an amount equal to the excess of the fair market value of the common stock at the time of exercise over the exercise price. On a subsequent sale of the shares of common stock received upon exercise, the difference between the net proceeds of sale and the fair market value of the shares on the date of exercise will generally be taxed as capital gain or loss (long-term or short-term, depending on the holding period).
MERITAGE HOMES | 2023 Proxy Statement 13
PROPOSAL 5: AMENDMENT TO OUR 2018 STOCK INCENTIVE PLAN
Incentive Stock Options. A participant will not recognize income upon the grant of an incentive stock option. In addition, a participant will not recognize income upon the exercise of an incentive stock option if the participant satisfied certain employment and holding period requirements. To satisfy the employment requirement, a participant must exercise the option not later than three months after he or she ceases to be an employee of the Company or any of its subsidiaries (or later than one year if he or she is disabled), unless he or she has died. To satisfy the holding period requirement, a participant must hold the stock acquired upon exercise of the incentive stock option more than two years from the date of grant of the stock option and more than one year after the transfer of the shares of common stock to him or her. If these requirements are satisfied the participant will on the sale of such stock be taxed on any gain, measured by the difference between the option exercise price and the net proceeds of sale, generally at long-term capital gains rates.
If shares of common stock acquired upon the timely exercise of an incentive stock option are sold, exchanged, or otherwise disposed of without satisfying the holding period requirements, the participant will, in the usual case, recognize (i) capital gain in an amount equal to the excess, if any, of the sales price over the fair market value of the shares on the date of exercise; (ii) ordinary income in an amount equal to the excess, if any, of the lesser of the sales price or the fair market value of the shares on the date of exercise over the option exercise price of the option; and (iii) capital loss equal to the excess, if any, of the option exercise price over the sales price.
Individuals are subject to an “alternative minimum tax” based upon an expanded tax base to the extent such tax exceeds the regular tax liability. The amount by which the fair market value of the shares acquired upon exercise of an incentive stock option exceeds the exercise price will be included as a positive adjustment in the calculation of the employee’s “alternative minimum taxable income” in the year of exercise. The “alternative minimum tax” imposed on individual taxpayers is generally equal to the amount by which a specified percentage of the individual’s alternative minimum taxable income (reduced by certain exemption amounts) exceeds his or her regular income tax liability for the year.
Stock options otherwise qualifying as incentive stock options will be treated as nonqualified stock options to the extent that the aggregate fair market value of stock with respect to which incentive stock options are exercisable for the first time by a participant during any calendar year (under all of the Company’s plans) exceeds $100,000 based on the fair market value of the stock at the date of grant.

MERITAGE HOMES | 2018 Proxy Statement 14
PROPOSAL 4: ADOPTION OF OUR 2018 STOCK INCENTIVE PLAN


If certain awards fail to comply with Internal Revenue Code Section 409A, a participant must include in ordinary income all deferred compensation conferred by the award, pay interest from the date of the deferral and pay an additional 20% tax. The award agreement for any award that is subject to Section 409A may include provisions necessary for compliance as determined by the Compensation Committee. The Company intends (but cannot and does not guarantee) that awards granted under the Plan will comply with the requirements of Section 409A or an exception thereto and intends to administer and interpret the Plan in such a manner. Subject to the $1 million dollar deduction limit imposed by Section 162(m) of the Code, the Company will generally be entitled to a tax deduction corresponding in amount and time to the participant’s recognition of ordinary income in the circumstances described above, provided, among other things, that such deduction meets the test of reasonableness and is an ordinary and necessary business expense. However, in connection with a change in control of the Company and depending upon the terms and conditions of Awards granted under the Plan and upon the individual circumstances of the participants, certain amounts with respect to Awards granted under the Plan may constitute “excess parachute payments” under the “golden parachute” provisions of Section 280G of the Code. Under these provisions, a participant will be subject to a 20% excise tax on any “excess parachute payment” and the Company will be denied any deduction with respect to such payment.
Plan Benefits
The issuance of any awards under the Plan will be at the discretion of the Executive Compensation Committee. Therefore, except as set forth in footnote (1) below, it is not possible to determine the amount or formnumber of any other awardsshares that will be granted to any individual in the future. As discussed elsewhere in this proxy statement, currently, each of our NEOs compensation is structured based on the terms of their respective employment agreement. These employment agreements contemplate that each NEO will receive an annual grant of restricted stock units and performance-based shares having an aggregate value for Messrs. Lord and Hilton, Mss. Sferruzza and Clinton, and Messrs. Szubinski and Feliciano of $4,050,000, $1,000,000, $1,450,000, $824,000, $1,300,000, and $645,000 respectively. The ultimate number of shares to be awarded pursuant to the NEOs employment agreements will be determined based on the market value of our common stock on the date of grant, and with respect to the performance shares awards, the Company’s achievement levels of the applicable performance targets, which achievement may vary from 0% to 200%. Also as discussed elsewhere in this proxy statement, 75% of the compensation paid to our non-employee directors in the aggregate is in the form of equity awards. Accordingly, we anticipate that in future periods our non-employee directors will be granted restricted stock units under the Plan determined on the date of grant based on the market value of our common stock on such grant date. The following table sets forth the number of sharesrestricted stock units and performance share awards granted as equity incentive awards during 20172022 under the 20062018 Plan to (i) all our named executive officers, individually and as a group; (ii) all current directors and director nominees who are not executive officers, individually and as a group; and (iii) all employees, including all current officers who are not executive officers, as a group.
14 MERITAGE HOMES| 2023 Proxy Statement
Individual or Group Name
Number of Shares Subject
to Options and Non-
Vested Shares Granted (1)
Weighted Average
Exercise Price per
Share (2)
Executive Officers
Steven J. Hilton58,652
Hilla Sferruzza23,094
C. Timothy White24,926
Phillippe Lord36,656
Javier Feliciano10,792
Executive Officer Group (five persons)154,120
Non-Executive Director Group
Robert G. Sarver5,000
Raymond Oppel5,000
Peter L. Ax5,000
Richard T. Burke, Sr.5,000
Gerald W. Haddock5,000
Dana Bradford5,000
Michael R. Odell5,000
Deb Henretta (3)
15,000
Non-Executive Director Group (eight persons)50,000
Non-Executive Officer Employee Group (about 160 persons)380,575
(1)
Balance includes performance share awards granted (at target levels) to our NEO’s including those where the performance criteria have not yet been achieved. Does not include shares granted in the first quarter of 2018. In 2018, Mr. Hilton, Ms. Sferruzza and Messrs. White, Lord, and Feliciano were granted22,124, 12,722, 9,403, 21,571, and 4,702 performance shares (at target levels), respectively, and an equal number of single-metric performance-based awards, respectively. In addition, Mr. Hilton received an incremental grant of 16,593 single-metric performance-based awards and an equal number of service-based restricted stock units. Also during 2018, each non-Executive Director received a total grant of 5,000 restricted shares, and the non-executive employee group received grants aggregating 289,571 restricted shares.
(2)Weighted average exercise price per share is not applicable as no options were granted in 2017.
(3)Ms. Henretta was appointed to the Board of Directors on March 7, 2016 and accordingly received a catch-up stock award in 2017, which has a three-year ratable vesting period.


15 MERITAGE HOMES| 2018 Proxy Statement
PROPOSAL 4: ADOPTION OF5: AMENDMENT TO OUR 2018 STOCK INCENTIVE PLAN
Individual or Group Name and Position
Dollar Value (1)
Aggregate Restricted Stock Units and Performance Awards Granted (1)
Stock Options Granted
Weighted Average Exercise Price per Share (2)
Executive Officers
Phillippe Lord, CEO$3,667,484 36,518 — 
Hilla Sferruzza, EVP, CFO$1,477,117 14,708 — 
Steven J. Hilton, Executive Chairman$1,018,757 10,144 — 
Clint Szubinski, EVP, COO$1,324,263 13,186 — 
Malissia Clinton, EVP, GC$589,748 6,644 — 
Javier Feliciano, EVP, CPO$547,542 5,452 — 
Executive Officer Group (six persons)$8,624,911 86,652 — 
Non-Executive Director Group
Peter L. Ax, Non-Employee Director and Nominee$233,975 2,500 — 
Raymond Oppel, Non-Employee Director$233,975 2,500 — 
Gerald Haddock, Non-Employee Director and Nominee$233,975 2,500 — 
Dana C. Bradford, Non-Employee Director$233,975 2,500 — 
Michael R. Odell, Non-Employee Director and Nominee$233,975 2,500 — 
Deborah Ann Henretta, Non-Employee Director$233,975 2,500 — 
Joseph Keough, Non-Employee Director and Nominee$233,975 2,500 — 
P. Kelly Mooney, Non-Employee Director$233,975 2,500 — 
Louis E. Caldera, Non-Employee Director$233,975 2,500 — 
Non-Executive Director Group (nine persons)$2,105,775 22,500 — 
Non-Executive Officer Employee Group (about 123 persons)$19,858,486 212,514 — 
Each associate of any such directors, executive officers or nominees$— — — 
Each other person who received or is to receive 5% of such options or rights$— — — 

(1) Includes performance share awards granted (at target levels, grant date value as reflected in the Summary Compensation Table and Director Compensation Table) to our NEO’s including those where the performance criteria has not yet been achieved. Does not include shares granted in the first quarter of 2023. In February 2023, Messrs. Lord, Hilton, Szubinski, and Feliciano, and Mss. Sferruzza and Clinton were granted 18,774, 4,635, 6,026, 2,989, 6,721 and 3,819 restricted stock units, respectively, and an equal number of performance shares (at target levels). Also in February 2023, each non-Executive Director received a total grant of 2,100 restricted shares, and the non-executive employee group received grants aggregating 116,448 restricted shares.

(2) Weighted average exercise price per share is not applicable as no options were granted in 2022.

The affirmative vote of a majority of the votes cast on the proposal is required for approval of this amendment to the Plan. For purposes of the vote to approve our 2018 Stock Incentive Plan, abstentions will have the same effect as votes against the proposal. Broker non-votes and abstentions will not have any effect on the result of the vote.


THE BOARD RECOMMENDS THAT YOU VOTE “FOR” THE PROPOSAL TO APPROVE AN AMENDMENT TO THE COMPANY'S 2018 STOCK INCENTIVE PLAN.



PLAN TO INCREASE THE NUMBER OF SHARES OF COMMON STOCK AUTHORIZED FOR ISSUANCE THEREUNDER.
MERITAGE HOMES | 20182023 Proxy Statement 1615
SECURITY OWNERSHIP BY MANAGEMENT AND PRINCIPAL STOCKHOLDERS



Security Ownership by Management and Principal Stockholders
Management. The following table summarizes, as of March 21, 2018,23, 2023, the number and percentage of outstanding shares of our common stock beneficially owned by the following:
•each Meritage director and nominee for director;
•each executive officer named in the summary compensation table;Summary Compensation Table; and
•all Meritage directors and executive officers as a group.
Name Of
Beneficial Owner (1)
Position With The
Company		Number
Of Shares
Owned		 Right To
Acquire By
May 22,
2023
Total Shares
Beneficially
Owned (2)
Percent Of
Outstanding
Shares (3)
Steven J. HiltonDirector, Executive Chairman395,366 (4)— 395,366 1.1 %
Raymond OppelDirector10,000 — 10,000 *
Peter L. AxDirector18,029 (5)— 18,029 *
Gerald HaddockDirector8,000 — 8,000 *
Dana C. BradfordDirector56,500 — 56,500 *
Michael R. OdellDirector35,000 — 35,000 *
Deborah Ann HenrettaDirector19,367 — 19,367 *
Joseph KeoughDirector12,750 — 12,750 *
P. Kelly MooneyDirector8,250 — 8,250 *
Louis E. CalderaDirector2,500 2,500 *
Phillippe LordDirector, Chief Executive Officer91,101 (6)— 91,101 *
Hilla SferruzzaExecutive Vice President and
Chief Financial Officer		42,918 — 42,918 *
Clint SzubinskiExecutive Vice President and Chief Operating Officer4,230 — 4,230 *
Malissia ClintonExecutive Vice President, General Counsel and Secretary— — — — 
Javier FelicianoExecutive Vice President and Chief People Officer14,594 — 14,594 *
All current directors and executive officers as a group (15 persons) 718,605 — 718,605 2.0 %
Name Of
Beneficial Owner (1)
 
Position With The
Company
 
Number
Of Shares
Owned
 
Right To
Acquire By
May 20,
2018
 
Total Shares
Beneficially
Owned (2)
 
Percent Of
Outstanding
Shares (3)
Steven J. Hilton Director, Chairman and CEO 1,637,868
(4)—
 1,637,868
 4.0%
Robert G. Sarver Director 200,659
(5)—
 200,659
 *
Raymond Oppel Director 65,000
 —
 65,000
 *
Peter L. Ax Director 42,500
 —
 42,500
 *
Richard T. Burke, Sr. Director 67,500
 —
 67,500
 *
Gerald Haddock Director 59,500
(6)—
 59,500
 *
Dana Bradford Director 53,000
 —
 53,000
 *
Michael R. Odell Director 34,000
 —
 34,000
 *
Deb Henretta Director 9,167
 —
 9,167
 *
Hilla Sferruzza 
Executive Vice President and
Chief Financial Officer
 15,925
 —
 15,925
 *
C. Timothy White 
Executive Vice President,
General Counsel and Secretary
 44,539
(7)—
 44,539
 *
Phillippe Lord Executive Vice President and Chief Operating Officer 6,040
 11,197
(8)17,237
 *
Javier Feliciano Executive Vice President and Chief Human Resources Officer 4,651
 —
 4,651
 *
All current directors and executive officers as a group (13 persons)   2,240,349
 11,197
 2,251,546
 5.5%
*Less than 1%.
(1)The address for our directors and executive officers is c/o Meritage Homes Corporation, 8800 East Raintree Drive, Suite 300, Scottsdale, Arizona 85260.
(2)The amounts shown include the shares of common stock actually owned as of March 23, 2023, and the shares that the person or group had the right to acquire within 60 days of that date. The number of shares includes shares of common stock owned by other related individuals and entities over whose shares of common stock such person has custody, voting control or the power of disposition.
(3)Based on 36,765,267 shares outstanding as of March 23, 2023.
(4)Shares are held by family trusts except for 17,000 shares held in a charitable trust, which is controlled by Mr. Hilton.
(5)All shares are held by a living trust.
(6)46,660 shares are held in a family limited partnership controlled by Mr. Lord.

16 MERITAGE HOMES| 2023 Proxy Statement
(1)The address for our directors and executive officers is c/o Meritage Homes Corporation, 8800 East Raintree Drive, Suite 300, Scottsdale, Arizona 85260.
(2)The amounts shown include the shares of common stock actually owned as of March 21, 2018, and the shares that the person or group had the right to acquire within 60 days of that date. The number of shares includes shares of common stock owned by other related individuals and entities over whose shares of common stock such person has custody, voting control or the power of disposition. As of March 21, 2018, there were no outstanding options for any of our NEOs or Board members as we no longer award stock options as part of equity compensation program.
(3)Based on 40,630,066 shares outstanding as of March 21, 2018.
(4)Shares are held by family trusts. As of March 21, 2018, Mr. Hilton had 900,000 shares pledged to a third-party lending institution, 350,000 of which are securing loans. Our pledging policy is discussed on page 28 of this proxy statement.
(5)Shares are held by family trusts (6,000 shares Penny Sarver—wife; 2,000 shares Penny Sarver FBO Max Sarver—minor son; 8,170 shares Robert Sarver—trustee of Eva Lauren Hilton Trust; 8,170 shares Robert Sarver—trustee of Shari Rachel Hilton Trust; 176,319 shares Robert Sarver—trustee of Robert Sarver Trust). Mr. Sarver has expressly disclaimed any beneficial ownership of the shares held by the trusts for the benefit of Mr. Hilton’s children (Eva Lauren Hilton Trust and Shari Rachel Hilton trust). Mr. Sarver had 119,819 shares pledged to a third-party lending institution as of March 21, 2018. None of these shares secured loans in 2017. Our pledging policy is discussed on page 28 of this proxy statement.
(6)Includes 15,000 shares held by charities on which Mr. Haddock serves as a board member and has authority to make investment decisions on behalf of. These holdings are with The Haddock Center (10,000 shares), and the Haddock Foundation (5,000 shares). Mr. Haddock has expressly disclaimed beneficial ownership of these shares.
(7)
15,446 shares are held by a family trust.
(8)Includes 4,001 performance-based shares and 7,196 restricted stock units vesting on March 31,2018.


17 MERITAGE HOMES| 2018 Proxy Statement
SECURITY OWNERSHIP BY MANAGEMENT AND PRINCIPAL STOCKHOLDERS



 
Certain Other Beneficial Owners. Based on filings made under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of March 21, 2018, the23, 2023, the only other known beneficial owners of more than 5% of Meritage common stock are shown in the following table:
    Shares Beneficially Owned
Name of Other Beneficial OwnersAddress Of Beneficial OwnerNumberPercent
BlackRock, Inc. (1)55 East 52nd Street, New York, NY 100556,241,502 17.0 %
The Vanguard Group (2)100 Vanguard Blvd., Malvern, PA 193554,246,391 11.6 %
      Shares Beneficially Owned
Name of Other Beneficial Owners Address Of Beneficial Owner Number Percent
BlackRock, Inc. (1)
 
55 East 52nd Street, New York, NY 10055
 5,593,226
 13.9%
FMR, LLC (2)
 245 Summer Street, Boston, MA 02210 3,663,704
 9.1%
The Vanguard Group (3)
 100 Vanguard Boulevard, Malvern, PA 19355 3,426,070
 8.5%
Dimensional Fund Advisors, LP (4)
 6300 Bee Cave Road, Austin, TX 78746 3,364,977
 8.3%
Earnest Partners, LLC (5)
 1180 Peachtree Street NE, Suite 2300, Atlanta, GA 30309 2,080,250
 5.2%
(1)Based solely on a Schedule 13G/A filed with the SEC on January 26, 2023, BlackRock, Inc. and certain affiliated entities have sole voting power with respect to 6,170,661 shares and sole dispositive power with respect to 6,241,502 shares. The Schedule 13G/A discloses that the interest of iShares Core S&P Small-Cap ETF holds more than five percent of the outstanding stock of the Company.
(1)Based solely on a Schedule 13G/A filed with the SEC on January 19, 2018, BlackRock, Inc. and certain affiliated entities have sole voting power with respect to 5,503,561 shares and sole dispositive power with respect to 5,593,226 shares
(2)Based solely on a Schedule 13G/A filed with the SEC on January 10, 2018, FMR, LLC has sole dispositive power with respect to 3,663,704 shares.
(3)Based solely on a Schedule 13G/A filed with the SEC on February 9, 2018, The Vanguard Group has sole voting power with respect to 43,682 shares, shared voting power with respect to 4,872 shares, sole dispositive power with respect to 3,380,312 shares and shared dispositive power with respect to 45,758 shares.
(4)Based solely on a Schedule 13G/A filed with the SEC on February 9, 2018, Dimensional Fund Advisors, LP has sole voting power with respect to 3,242,235 shares and sole dispositive power with respect to 3,364,977 shares.
(5)Based solely on a Schedule 13G/A filed with the SEC on February 14, 2018, Earnest Partners, LLC has sole voting power with respect to 515,766, shared voting power with respect to 137,223 shares and sole dispositive power with respect to 2,080,250 shares.

(2)Based solely on a Schedule 13G/A filed with the SEC on February 09, 2023, The Vanguard Group has shared voting power with respect to 30,500 shares, sole dispositive power with respect to 4,179,282 shares, and shared dispositive power with respect to 67,109 shares.

For each of the reporting owners set forth above, the beneficially owned shares are held in various individual funds owned or managed by the reporting owners, but none of the individual funds managed by the reporting owners above hold more than 5% of the Company stock.owners.

There are no stockholders with preferential voting or non-voting shares.
 

MERITAGE HOMES | 20182023 Proxy Statement 1817
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS



Corporate Governance and Board Matters
Role of the Board of Directors
The Board of Directors (“the Board”) is elected by the stockholders to oversee the stockholders’ interests in the operation and overall success of our business. The Board serves as our ultimate decision-making body, except for those matters that require a vote of our stockholders. The Board selects and oversees the members of seniorexecutive management who are charged by the Board with conducting our business. We have established, and operate in accordance with, a comprehensive plan of corporate governance that defines and sets ethical standards for the conduct of our directors, officers and employees. This plan provides an important framework within which the Board can pursue our strategic objectives and ensure long-term stockholder value.

Corporate Governance Principles and Practices
We have adopted Corporate Governance Principles and Practices that define the key elements of our corporate governance framework and philosophy, including:
•director qualifications,
•director access to officers and employees,
•independence criteria,
•our philosophy with respect to director compensation,
•director responsibilities,
•Board evaluation process,
•committee responsibilities and structure,
•confidentiality requirements,
•officer and director stock ownership requirements,
•director orientation and continuing education, and
•director resignation policy,
•our plans with respect to management succession.
independence criteria,
director responsibilities,
committee responsibilities and structure,
officer and director stock ownership requirements,
director resignation policy,
director access to officers and employees,
our philosophy with respect to director compensation,
Board evaluation process,
confidentiality requirements,
director orientation and continuing education, and
our plans with respect to management succession.
Our Corporate Governance Principles and Practices are available on our website at investors.meritagehomes.com and we will provide a printed copy to any stockholder upon request.. These principles are reviewed regularly by the Nominating/Governance Committee and changes are made as the Committee deems appropriate.

Director Qualifications and Diversity
Our Board of Directors is comprised of a group of individuals whose previous experience, financial and business acumen, personal ethics and dedication and commitment to our Company allow the Board to complete its key task as the over-seeroverseer and governing body of Meritage Homes Corporation.the Company. The specific experience and qualifications of each of our Board members are set forth below. The Board is committed to a policy of inclusiveness and diversity. The Board believes members should be comprised of persons with diverse backgrounds, skills, expertise, backgrounds and experiences, including without limitation, the following areas:following:
•management or board experience in a wide variety of enterprises and organizations,
•banking, capital markets and finance,
•accounting,
•legal and regulatory,
•real estate, including homebuilding, commercial and land development,
•technology and cyber security,
•sales, and marketing and branding,
•environmental, social and governance ("ESG") and human capital, and
•operations.

18 MERITAGE HOMES| 2023 Proxy Statement
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS




The below matrix illustrates the key skills, expertise, and experience of each director:
CapabilitiesSteven J. HiltonPhillippe LordPeter L. AxRaymond OppelGerald HaddockDana C. BradfordMichael R. OdellDeborah Ann HenrettaJoseph KeoughP. Kelly MooneyLouis E. Caldera
Current Executive ManagementXXXXXXXX
Cyber/IT/TechnologyXX
ESGXX
FinancialXXXXXXXX
Home Building/Real EstateXXXX
Human CapitalXX
Legal, Regulatory & ComplianceXXX
Manufacturing or OperationsXXXXXXX
Marketing & SalesXXXXXXX
Private BoardXXXXXXXXXX
Public BoardXXXXXXXXXX
Our bylaws require a customary majority voting standard for the election of directors. In addition, our Corporate Governance Principles and Practices require that any nominee for director who is an incumbent director but who is not elected by the vote required in the bylaws, and with respect to whom no successor has been elected, promptly tender his or her offer to

19 MERITAGE HOMES| 2018 Proxy Statement
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS


resign to the Board of Directors for its consideration. The Nominating/Governance Committee of the Board of Directors will recommend to the Board of Directors whether to accept or reject the resignation offer, or whether other action should be taken. In determining whether to recommend that the Board of Directors accept any resignation offer, the Nominating/Governance Committee will be entitled to consider all factors believed relevant by the Nominating/Governance Committee’s members. The Board of Directors will act on the Nominating/Governance Committee’s recommendation within 90 days following certification of the election results and will announce its determination and rationale in a Form 8-K. In deciding whether to accept the resignation offer, the Board of Directors will consider the factors considered by the Nominating/Governance Committee and any additional information and factors that the Board of Directors believes to be relevant. If the Board of Directors accepts a director’s resignation offer pursuant to its process, the Nominating/Governance Committee will recommend to the Board of Directors and the Board of Directors will thereafter determine what action, if any, will be taken with respect to any vacancy created by a resignation. Any director who tenders his or her resignation pursuant to this policy will not participate in the proceedings of either the Nominating/Governance Committee or the Board of Directors with respect to his or her own resignation.
In case of a Board vacancy or if the Board elects to increase its size, determinations regarding the eligibility of director candidates are made by the Nominating/Governance Committee, which considers the candidate’s qualifications as to skills and experience in the context of the needs of the Board of Directors and our stockholders. When seeking new Board candidates, the Nominating/Governance Committee is committed to a policy of inclusiveness and will take reasonable steps to ensure that women and minority candidatespeople of color are considered for the pool of candidates from which the Board nominees are chosen, and will endeavor to include candidates from non-traditional venues. Currently, the Board has retained a search firm with a search underway to replace potential director retirements in the near term.

The following charts and biographies provide summary information about the tenure, demographics and experience of our directors as of March 23, 2023:
mth-20230323_g7.jpg
(a) Includes two females and one person of color.

MERITAGE HOMES | 20182023 Proxy Statement 2019
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS




Our Board is comprised of the following members:
Class I Directors
Steven J. Hilton, 5661
Mr. Hilton is the Executive Chairman of Meritage Homes and has been the Company’s chairmana director since 1996. Mr. Hilton led Meritage Homes for 35 years as Chairman and Chief Executive Officer since May 2006. Mr. Hilton was the co-chairman and co-Chief Executive Officer of Meritage Homes Corporation from 1996 to May 2006.until his retirement as CEO effective January 1, 2021. In 1985, Mr. Hilton co-foundedcofounded Arizona-based Monterey Homes, the predecessor company to Meritage Homes Corporation.Homes. Under Mr. Hilton’s leadership, Monterey became publicly traded in 1996. 1997.
Mr. Hilton received his Bachelor of Sciencea Bachelor’s degree in accountingAccounting from the University of ArizonaArizona. He serves as Chairman of the Board for Banner Health Foundation as well as a board member for Translational Genomics Research Institute (TGEN) Foundation and isthe Boys & Girls Clubs of Greater Scottsdale Foundation. He also previously served as a director ofboard member for Western Alliance Bancorporation, (a NYSE listed company), a leading bank holding company based in Phoenix, Arizona.

(NYSE: WAL) until June 2022. Mr. Hilton has almost 32brings extensive and intimate knowledge of the Company to the Board as its co-founder and through over 35 years of real estate experience and is considered an expert and innovator in leading the homebuilding industry. He is a frequent participant in panels and interviews regarding the industry.Company.
stevehilton2018.jpgmth-20230323_g8.jpg
Raymond Oppel, 6166Mr. Oppel has been a director since December 1997. Mr. Oppel is a licensed real estate broker and currently is active as a private investor in real estate development. He was the co-founder, chairmanChairman and Chief Executive Officer of The Oppel Jenkins Group, a regional homebuilder in Texas and New Mexico, which was purchased in 1995 by public homebuilder KB Home.



Mr. Oppel has almostover 30 years of experience in the homebuilding business. Mr. Oppel possesses extensive knowledge about the real estate industry in general and the homebuilding industry in particular.
rayoppel2018.jpgmth-20230323_g9.jpg
Richard T. Burke, Sr., 75Mr. Burke has been a director since September 2004. Mr. Burke is currently the Chairman of the Board of Directors of UnitedHealth Group, which he founded, took public in 1984 and served as Chief Executive Officer as well. From 1995 until 2001, Mr. Burke was the owner and Chief Executive Officer of the Phoenix Coyotes, a National Hockey League team and has served as a director for a number of other companies, both public and private.

Mr. Burke is a business and civic leader in Phoenix, Arizona, and his experience as the chairman and CEO of a multi-billion dollar public company provides the Board with outstanding corporate governance and financial insight.
richardburke2018.jpg
Dana C. Bradford, 5358Mr. Bradford has been a director since August 2009. In 2012, Mr. Bradford iscofounded and was appointed and currently serves as Chairman and Chief Executive Officer of WaittC3 Brands, the parent company to a diversifiednumber of consumer brands company.brands. From 2005 to 2012, Mr. Bradford was the presidentPresident and managing partnerManaging Partner of McCarthy Capital Corporation, a private equity firm. He also serves as a director on the boards of Southwest Value Partners, a San Diego-based real estate company and Customer Service Profiles, an Omaha-based provider of customer satisfaction data and analytics. Mr. Bradford formerly served as chairmanChairman of the boardBoard of SAFE Boats International, a Seattle-based manufacturer of defense and emergency response boats and Vornado Air, a Wichita-based consumer brands company and formerly served as a director on the boards of McCarthy Groups, Ballantyne, NRG Media, Guild Mortgage and Gold Circle Films.


 
Mr. Bradford earned a bachelor’sBachelor's degree in business administrationBusiness Administration from the University of Arizona and an MBA from Creighton University. Mr. Bradford brings additional perspective to the Board relating to real estate and corporate finance matters.
danabradford2018.jpgmth-20230323_g10.jpg
DebDeborah Ann Henretta, 5661
Ms. Henretta has been a director since March 2016. Ms. Henretta retired from the ProctorProcter & Gamble, Co. ("P&G") in 2015. Throughout her 30 years at P&G, she held various senior positions throughout several sectors, serving as Group President of Global e-Commerce, which includede-Business while concurrently serving as HeadPresident/Senior Executive Officer of Global Beauty Care; DivisionBeauty; President of Global Baby/Toddler & AdultBaby Care; and Division Vice President of Fabric Conditioners and Bleach. She has been a director at Corning, Inc. since 2013, at Nisource Inc. since 2015, and at Staples, Inc. from 2016 to September 2017 when Staples was acquired by Sycamore Partners, a private equity investor. In addition, effective January 1, 2018, Ms. Henretta was appointed a director of Iron Horse Special Purpose Acquisition Company, the successor to Staples, Inc. and an affiliated entity of Sycamore Partners.

American Eagle Outfitters (NYSE:AEO) since 2019. Ms. Henretta is a Partner at Council Advisors (formerly G100 CompaniesCompanies) where she assisted in establishing a New Director Board Excellence Program that includes director education on board oversight and governance, including digital transformation and cyber security.



Ms. Henretta graduated summa cum laude from St. Bonaventure University with a BABachelor of Arts in communications in 1983.Communication. She earned her MAMaster of Arts in advertising research and teaching assistantshipAdvertising from Syracuse University Newhouse School of Public Communications in 1985.
and holds an honorary Doctorate of Humane Letters from St. Bonaventure University. Ms. Henretta brings additional perspective to the Board relating to technology, cyber security and diversity and inclusion.
debhenretta2018.jpgmth-20230323_g11.jpg
P. Kelly Mooney, 59Ms. Mooney has been a director since March 2020. Ms. Mooney is the Founder and CEO of Equipt Women, a public benefit corporation dedicated to connecting, empowering and upskilling young professional women. She was previously a co-owner of Resource/Ammirati, a digital marketing and customer experience innovation firm, and held various positions of leadership including Chief Executive Officer from January 2011 to September 2017; President from June 2001 to January 2011; and Chief Experience Officer and Director of Intelligence from March 1995 to May 2001. During that tenure, she advised dozens of Fortune 500 executives on customer growth strategy and digital transformation to increase shareholder value. In 2016, Resource/Ammirati was sold to IBM to become part of IBM iX, one of the world’s largest digital consultancies. Ms. Mooney joined IBM iX in September 2017 and served as Chief Experience Officer until June 2018. She advises consumer and technology-focused entrepreneurs on leadership, strategy and innovation.

Ms. Mooney has also served as a board member of Sally Beauty Supply Holdings, Inc. (NYSE:SBH), an international specialty retailer and distributor of professional beauty supplies and J. Jill Inc. (NYSE: JILL), an omnichannel women's apparel brand. She graduated with honors with a Bachelor of Science in Industrial Design from The Ohio State University. Ms. Mooney brings additional perspective on innovation, sustainability, diversity and inclusion.
mth-20230323_g12.jpg




21
20 MERITAGE HOMES| 20182023 Proxy Statement
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS






Class III Directors
(continued)
Louis E. Caldera, 67
Mr. Caldera has been a director since December 2021. Mr. Caldera is a private investor and corporate director. He has been serving as a director of DallasNews Corp (formerly Belo Corp) since 2001, where he also chairs the compensation and management development committee, and has been serving as a director of Granite Construction Inc since 2021. Mr. Caldera is also currently serving as a senior advisor to Belay Associates, LLC, a private equity firm, and its affiliate Everest Consolidator Acquisition Corporation (NYSE: MTNT.U). Mr. Caldera has held several leadership positions in education, including Distinguished Adjunct Professor of Law at American University Washington College of Law from September 2018 to June 2021, and Professor of Leadership and a Senior Fellow of the George Washington University Cisneros Hispanic Leadership Institute from 2016 to 2018. He has also served in government as Secretary of the Army in the Clinton Administration and as an Assistant to the President and Director of the White House Military Office in the Obama Administration. Mr. Caldera began his career as an army officer, corporate lawyer, and California state legislator.He is the co-founder and co-chair of the Presidents’ Alliance on Higher Education and Immigration, a nonprofit organization, and serves on the board of the Latino Corporate Directors Association.

Mr. Caldera holds an MBA from Harvard Business School, a Juris Doctor from Harvard Law School and a Bachelor of Science from the United States Military Academy. He has significant knowledge and experience in the leadership of large organizations, corporate governance including environmental, social and sustainability governance, and in legal, regulatory and policy matters.
mth-20230323_g13.jpg
MERITAGE HOMES | 2023 Proxy Statement 21
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS

Class II Directors
Peter L. Ax, 5863Mr. Ax has been a director since September 2000 and is the Company's lead independent director. He isIn 2001 he joined UpscriptHealth, a telemedicine-based software platform which facilitates pharmaceutical manufacturers selling medications direct-to-consumers, where he currently serves as the Chief Executive Officer of UpscriptHealth, a telemedicine based software platform which allows pharmaceutical manufacturers to sell medications direct-to-consumer.Officer. He is also remains the managing partnerManaging Partner of Phoenix Capital Management, an operationally focused venture capital firm. Mr. Ax iswas the former chairmanChairman and Chief Executive Officer of SpinCycle, Inc., a public reporting consolidator and developer of coin-operated laundromats. Previously, Mr. Ax served as head of the Private Equity Placement Division and senior vice presidentSenior Vice President of Lehman Brothers in New York and has served in various operating roles for enterprises operated by Phoenix Capital Management. Mr. Ax is also served on the board of directors of iGo, Inc. (formerly, NASDAQ: IGOI) and serves on the Advisory Board of Directors of Cascadia Capital, a Seattle-based investment banking and merchant banking firm.

from 2007 to January 2022.

Mr. Ax holds an MBA from the Wharton School at the University of Pennsylvania, a J.D.Juris Doctorate from the University of Arizona, and a B.S.B.A.Bachelor of Science in Business Administration from the University of Arizona, and has been a certified public accountant.Certified Public Accountant. Mr. Ax possesses extensive skills and experience relating to, among other things, capital markets and corporate finance.
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Robert G. Sarver, 56Mr. Sarver has been a director since December 1996. Effective April 1, 2018, Mr. Sarver will become the executive chairman of Western Alliance Bancorporation, transitioning from his previous position as chairman and Chief Executive Officer. Mr. Sarver is also the managing partner of the Phoenix Suns NBA basketball team. From 1995 to 1998, he served as chairman of Grossmont Bank. He was the chairman and Chief Executive Officer of California Bank & Trust from 1998 to 2001. Mr. Sarver earned a bachelor’s degree in business administration from the University of Arizona and has been a certified public accountant.

Mr. Sarver has been active in the real estate industry for more than 30 years and is known nationwide as a leader and expert in banking. He has extensive experience in a wide spectrum of successful real-estate activities, including commercial, residential and development projects.
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Gerald Haddock, 7075
Mr. Haddock has been a director since January 2005. Mr. Haddock is the founder of Haddock Enterprises, LLC and formerly served as presidentPresident and Chief Executive OfficerCEO of Crescent Real Estate Equities, a diversified real estate investment trust. He is currentlyMr. Haddock previously served for over 30 years as a director of Valaris plc (formerly ENSCO International, Plc.), a leading global offshore oil and gas drilling service company. As a director for ENSCO,Valaris, he has served as its co-lead director and Chairperson of the Audit Committee and iswas also a member of the Nominating & Governance Committee. From December 2004 to October 2008, Mr. Haddock is also a director of Union Acquisition Corp II, a special purpose acquisition corporation, and has served in this capacity since December 2018. Further, Mr. Haddock serves as a Board MemberDirector of Cano Petroleum, Inc.Hartman Income REIT, a non-traded SEC reporting real estate investment trust, and has served in this capacity since mid-2020. As a director for Hartman, Mr. Haddock serves as the Chairman of the Nominating & Governance Committee and as a member of the Audit Committee. He also serves on the board of trustees and is a memberthe CEELI Institute. Mr. Haddock has previously served on the Board of various committees for theTrustees of Baylor College of Medicine, (2011 to 2015),as a member of the Executive Investment Committee at Baylor University, and on the M.D. Anderson Proton Therapy Education and Research Foundation, the CEELI Institute, and the Johnny Unitas Golden Arm Educational Foundation.


Mr. Haddock received his Bachelor of business administrationBusiness Administration and Juris Doctorate degrees from Baylor University. He also received a Masters of Law in Taxation degree from New York University and an MBA degree from Dallas Baptist University. Mr. Haddock has extensive experience in real estate, legal and regulatory compliance.
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Michael R. Odell, 5459Mr. Odell has been a director since December 2011. He is presidentSince 2017, he has been Board Member, President and Chief Executive OfficerCEO of Marubeni Automotive Aftermarket Holdings LLC,("Marubeni"), a holding company for investments in the automotive aftermarket andaftermarket. He also presidentcurrently serves as Board Member, President and Chief Executive Officer of Marubeni subsidiaries XL Parts, LLC, anand The Parts House, both automotive parts distributor. Indistributors. From 2015 andthrough 2016, he served as presidentPresident of Eastern Auto Parts Warehouse, an automotive parts distributor. From 2008 through 2014, he served as president, Chief Executive OfficerPresident, CEO and board member of The Pep Boys - Manny, Moe & Jack, a NYSE-listed Fortune 1000 company and the nation’s leading automotive aftermarket service and retail chain.company. Mr. Odell joined Pep Boys in 2007 as Chief Operating Officer. Previously, he served as executive vice presidentExecutive Vice President and general managerGeneral Manager of Sears Retail & Specialty Stores, a $26 billion division of Sears Holdings Corporation.



Mr. Odell started his career as a CPA with Deloitte & Touche LLP. Mr. Odell holds an M.B.A.MBA from Northwestern University's Kellogg School of Management, and a B.S.Bachelor of Science in Accounting from the University of Denver's Daniels College of Business.  Mr. Odell has deep service, retail and distribution experience, with a broad background in strategic planning, leadership, sales, operations and finance.

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Joseph Keough, 53Mr. Keough has been a director since June 2019. He currently serves as Chairman and CEO of Wood Partners, one of the nation's largest multifamily real estate companies. Before joining Wood Partners, Mr. Keough was Chief Operating Officer of Fuqua Capital, the office for the Atlanta-based Fuqua family. Mr. Keough had also been a Senior Vice President in the office and multifamily division of Cousins Properties, a publicly traded REIT, as well as a Principal at The Boston Consulting Group. Mr. Keough is also on the board of directors of Interface, Inc. (NASDAQ: IFSIA).

Mr. Keough earned his MBA from Harvard Business School and received his Bachelor degree in Finance and Economics from Babson College. Mr. Keough brings a 23-year track record of strong business leadership, deep understanding of real estate and first-hand experience driving organizational transformation.
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Phillippe Lord, 49Mr. Lord became the CEO of Meritage Homes on January 1, 2021. He previously served as Chief Operating Officer of Meritage Homes from 2015 to 2020. From 2012 to 2015, Mr. Lord was President of the West Region at Meritage Homes. Mr. Lord began his Meritage Homes career in 2008 by creating the Company’s strategic operations and market research department, which analyzes land acquisitions, product and pricing.

Prior to joining Meritage Homes, Mr. Lord held leadership positions with Acacia Capital, Centex Homes and Pinnacle West Capital. Mr. Lord received a Bachelor's degree in Economics and Business from Colorado State University and completed his master's coursework in Economics at the University of Arizona. As CEO of the Company, Mr. Lord is uniquely qualified to serve as a member on our Board.
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Director Independence
The Nominating/Governance Committee evaluates and reports to the Board of Directors regarding the independence of each Board candidate. Consistent with the rules and regulations of the NYSE, at least a majority of the Board of Directors must be independent. No director will be deemed to be independent unless the Board affirmatively determines that the director has no material relationship with the Company, either directly or as an officer, shareowner,stockholder, member, partner or trustee of an organization that has a relationship with the Company. The Board observes all criteria established by the NYSE and other governing laws and regulations. In its review of director independence, the Board considers all commercial, banking, consulting, legal, accounting, charitable and other business relationships the director may have with the Company.
As a result of its review, the Board of Directors has determined that a majorityall of Meritage’sour current Board members are independent. Our independent directors, with the exception of Messrs. Hilton and Lord. Messrs. Hilton and Lord are Peter L. Ax, Raymond Oppel, Richard T. Burke, Sr., Gerald Haddock, Dana C. Bradford, Michael R. Odell and Deb Henretta.
not considered independent because they are executive officers of the Company. In making this determination, the Board of Directors evaluated whether any relationships exist between these individuals and Meritage and determined that no relationship exists between Meritage and any independent director.
Steven J. Hilton is not considered independent because he is employed by the Company.
Prior to 2004, Robert G. Sarver was deemed an independent director. The Nominating/Governance Committee has continually monitored certainThere are no familial relationships between Mr. Sarver and Meritage along with relationships between Mr. Sarver and Mr. Hilton. Mr. Sarver and Mr. Hilton have certain business relationships unrelated to Meritage, including Mr. Sarver serving as trustee of certain of Mr. Hilton’s family trusts. The Nominating/Governance Committee evaluated these relationships and determined that they did not impair Mr. Sarver’s independence because they do not involve Meritage and are insignificant in relation to Mr. Sarver’s net worth. During 2004, Mr. Sarver became the controlling ownermembers of the Phoenix Suns basketball team, in which Mr. Hilton purchased a minority ownership interest. This relationship was closely evaluated by the Nominating/Governance Committee because of its significance to Messrs. Sarver and Hilton. The Nominating/Governance Committee and the Board of Directors believe Mr. Sarver is a valuable member of the Board and that the Company benefits from his extensive business experience. Although Mr. Sarver does not have any material relationship with the Company which under the applicable rules and regulations would deem him not independent, the Nominating/Governance Committee has nevertheless concluded it is at this time in the best interest of Meritage’s stockholders that Mr. Sarver not be deemed an independent director.Board.
The Board has also determined that all committees of the Board with the exception of Land Committee, should be comprised entirely of independent directors and therefore neither Mr.Messrs. Hilton nor Mr. Sarverand Lord do not serve on any Board committees. The Board limits its independent members from serving on more than three other public company boards, limits the Executive Chairman to serving on two additional public company boards, and limits the CEO to serving on one additional public company board.

Board Leadership Structure
Steven J. Hilton, ourthe Company's co-founder, and CEO, also serves as a director and the Executive Chairman of the Board. We believe Mr. Hilton’s unique industry experience and continuing involvement in the day-to-daystrategic operations of the Company make him highly qualified to serve as our Board’sExecutive Chairman. Mr. Hilton co-founded Meritage Homes and is thus intimately familiar with its history, culture and operations. Mr. Hilton possesses in-depth knowledge and expertise in the homebuilding industry as a whole and Meritage Homes in particular and is the Company’s largest non-institutional stockholder. The Board of Directors has concluded that this puts Mr. Hilton in a unique position and makes it compelling for him to serve both as Executive Chairman of the Board and CEO to effectively represent the stockholders’ interest.
Mr. Ax, our Audit Committee Chair, serves as the Board’s lead independent director. Mr. Ax has extensive knowledge of capital markets and corporate finance and has previously served as CEO of a publicly traded corporation. We believe that Mr. Ax’s role as our lead independent director serves as a counterbalance to and complements Mr. Hilton’s position as BoardExecutive Chairman and provides the appropriate level of independent director oversight. Additionally, our lead independent director collaborates with Mr. Hilton in establishing agendas for Board meetings, presides over all independent director meetings and can call special meetings of the independent directors as he deems necessary to address any matters the lead independent director feels should be addressed by the majority of our directors at any time. To more formalize the role, duties and qualifications of the lead independent director, the Board has adopted a Lead Director Charter. This Charter is available on our website at investors.meritagehomes.com.

CEO and Management SuccessionSuccession; Board Composition and Refreshment
Under the charter of the Nominating/Governance Committee, it is the role of the Nominating/Governance Committee to review and recommend to the Board of Directors changes as needed to the Company’s Corporate Governance Principles and Practices, including items such as management succession, policies and principles for CEO selection and performance review, and policies regarding succession in the event of an emergency or departure of the CEO.CEO, and Board diversity, tenure and refreshment. Our Corporate Governance Principles and Practices provide, among other things, that our Executive Compensation Committee is to conduct an annual review of the performance of the CEO.

The Board is committed to good corporate governance and regularly solicits and receives feedback from investors, potential investors, and other participants in the investing community. As indicated above, the Board seeks to achieve a balance of Board director tenures in order to benefit from long-tenured directors’ institutional knowledge and newly elected directors’ fresh perspective and, towards this goal, has added three new independent directors over the past five years. The Board believes an effective refreshment program must be continuous and ongoing. Currently, the Board has retained a search firm with a search underway to replace potential director retirements in the near term.
Classified Board Structure
The Board will sunset the classified board structure within five years from 2023.

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The Board of Directors considers management evaluation and CEO succession planning an important responsibility of the Board. Under our Corporate Governance Principles and Practices, the Board of Directors is responsible for approving a succession plan for our CEO and other senior officers. Issues relating to CEO succession planning are addressed regularly (at least annually) by the Board.

Risk Oversight
Our Board of Directors has overall responsibility for the oversight of risk management. As part of this oversight, on a regular basis, our Board of Directors receives reports from various members of management and is actively involved in monitoring and approving key decisions relating to our operations and strategy. Additionally, the management teams at our divisions must obtain approvals from our corporate executive team prior to engaging in certain activities or committing prescribed amounts of the Company’s financial and operational resources. As a result, senior management, who report directly to executive management, cannot authorize transactions that exceed prescribed thresholds that, while they may result in short-term benefits for their divisions, may expose the Company to unwarranted risks. Similarly, our executive management (including our NEOs) cannot engage in certain transactions without approval from our Board of Directors.Board. For example, management must obtain approval from the Board, of Directors, acting through the Land Committee, before proceeding with any land acquisition above a pre-established threshold. In addition, our General Counsellegal department regularly reports to the Board of Directors information concerning ongoing litigation and possible legal, regulatory and other risks that might expose the Company to liability or loss. The Board also annually reviews the Company’s insurance programs.
Management operates the business within parameters established by an annual budget that is reviewed and approved by the Board of Directors.Board. At each regular Board meeting, management provides the Board of Directors a status report with respect to the budget and addresses any material variances. We believe our budgeting process provides a useful mechanism for identifying risks and the related rewards and provides a quantitative method for evaluating those risks and rewards. The Board of Directors also provides oversight of risk through its standing committees. For example: 
•Our Audit Committee is responsible for reviewing and analyzing significant financial and operational risks and how management is managing and mitigating such risks through its internal controls and financial risk management processes. Our VP of Internal Audit reports directly to the Audit Committee and provides routine updates on the progress and findings of the department's on-going internal audit reviews. Our external auditors also have at least quarterly discussions with our Audit Committee, and meet both with and without Company management present, to highlight what they perceive as our key financial risks. Our Audit Committee plays an important role in approvingoverseeing our internal controls monitoring and is regularly engaged in discussions with management regarding business risks, operational risks, transactional risks, cyber-security and financial risks. Cybersecurity and affiliated risks related to our information technology are a key component of our Board’s risk oversight. Our ability to conduct our business may be impaired if our information technology resources are compromised, degraded, damaged or fail, whether due to a virus or other harmful circumstance, intentional penetration or disruption of our information technology resources by a third party, natural disaster, hardware or software corruption or failure or telecommunications system failure, service provider error or failure, intentional or unintentional personnel actions (including the failure to follow our security protocols), or lost connectivity to our networked resources. All of our employees receive and are required to take ongoing cybersecurity awareness training throughout the year and our Chief Information Officer (CIO) provides a formal update to our Audit Committee at least twice per year, reviewing cybersecurity risks, trends, plans for future actions and measurements against recognized external cybersecurity frameworks and benchmarks.
•Our Executive Compensation Committee oversees risks relating to the compensation and incentives provided to our senior executive officers. The Executive Compensation Committee negotiates and approves all of the employment agreements of our NEOs and the Compensation Committee approves all grants of equity awards to all of our eligible employees. The Compensation Committee has the sole authority to hire outside compensation advisors and consultants and to determine the terms, scope and fees of such engagements.
Only Independent Directors sit•Our ES&S Committee is responsible to the Board and reports regularly to the Board and provides updates on the support, development, strategy, prioritization, integration and reporting of the Company's ongoing commitment to environmental, safety, corporate social responsibility, sustainability and other related trends, issues and concerns. The ES&S Committee regularly engages in discussions with management regarding our governance Committeesprocesses for identifying, assessing, monitoring and managing the principal environmental and social risks most relevant to provide greater Director participation in key policy decisions. Although it is not a requirement that members of our Land Committee are independent, currently all members are independent directors.Company.

The Board and Board Committees
We currently have nineeleven incumbent directors and the following committees:
•Audit Committee
Executive •Compensation Committee
•Nominating/Governance Committee
•Land Committee
•ES&S Committee
Our Board of Directors typically meets on a quarterly basis, with additional meetings held as required. During 2017,2022, the Board of Directors held four meetings. Throughout 2017,2022, each directorof our current directors attended at least 75% of the aggregate of the Board and committee meetings of which they were a member. Our Land Committee does not have regularly scheduled meetings but rather meetsare provided relevant materials for consideration and voting when significant land transactions require the Land Committee’s consideration. authorization.
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Directors are expected to attend our annual meetings of stockholders. All directors, including the five that are up for re-election at this year's meeting, attended our 20172022 annual meeting held on May 19, 2017.

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2022.
The following table identifies the current members of our Board of Directorsand Board Committees and the number of meetings held during 2017:2022:
Board of Directors Audit Committee 
Executive
Compensation
Committee
 
Nominating/
Governance
Committee
 
Land
Committee
Steven J. Hilton*        
Peter L. Ax + C   ü ü
Raymond Oppel   C   ü
Richard T. Burke, Sr. ü      
Gerald Haddock     C ü
Dana Bradford ü ü   ü
Michael R. Odell   ü    
Robert G. Sarver        
Deb Henretta     ü  
Number of Meetings 8 7 4 12
Board of DirectorsAudit CommitteeCompensation
Committee		Nominating/
Governance
Committee		Land
Committee		ES&S Committee
Steven J. Hilton*
Phillippe Lord
Peter L. Ax +Cüü
Raymond Oppelüüü
Gerald HaddockCü
Dana C. Bradfordüüü
Michael R. OdellC
Deborah Ann HenrettaC
Joseph Keoughüü
P. Kelly Mooneyüü
Louis E. Calderaü
Number of Meetings794n/a4
*=Executive Chairman of the Board
ü=Member
C=Committee Chair
+=Lead Independent Director
Audit Committee
The Board of Directors has established an Audit Committee in accordance with Section 3(a)(58)(A) of the Securities Exchange Act, of 1934 (Exchange Act), and the rules and regulations of the NYSE. The Audit Committee assists the Board of Directors in:
•fulfilling its oversight of the integrity of our financial statements,
•overseeing our compliance with legal and regulatory requirements,
•determining our independent registered public accounting firm’s qualifications and independence,
•evaluating our financial, operational, and information/cyber security risks and overseeing our efforts to mitigate these risks, which include among other things, annual cyber and risk trainings for all employees,
•evaluating the performance of our internal audit function and independent registered public accounting firm, and
•reviewing and approving any related party transaction between the Company and senior executive officers andor directors.
The Audit Committee has the sole authority to appoint and replace our independent registered public accounting firm and approves all audit engagement fees and terms of all significant non-audit engagements with the independent registered public accounting firm in accordance with the pre-approval policies set forth in our Audit Committee charter. The Audit Committee has the authority to obtain advice and assistance from, and receives appropriate funding from us for, outside legal, accounting and other advisors as it deems necessary to carry out its duties. The Audit Committee also receives briefings from our executive management team at least quarterly, addressing audit, compliance, and information security matters, among other topics.
The Audit Committee operates under a written charter established by the Board. The charter is available on our website at investors.meritagehomes.com and we will provide a printed copy to any stockholder upon request.. Each member of the Audit Committee meets the independence requirements of the NYSE and the Exchange Act, and is financially literate, knowledgeable and qualified to review our financial statements. In addition, each member of the Audit Committee has accounting or related financial management expertise. The Board of Directors has determined that Peter L. Ax, the Chair of our Audit Committee and each of our other two directors who serve as audit committee members are independent directors as defined by the NYSE’s listing standards, and each is an “audit committee financial expert.” Information about past business and educational experience of Mr. Ax and other members of the Audit Committee is included in their biographies in this proxy statement underin the captionsection “—Director Qualifications and Diversity —”Diversity”.
The report of the Audit Committee is included in this proxy statement underin the captionsection “Report of the Audit Committee.”
Executive
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Compensation Committee
The Board of Directors has established an Executivea Compensation Committee (the “Compensation Committee”) in accordance with the NYSE’s rules and regulations. The Compensation Committee regularly reports to the Board of Directors and its responsibilities include:include, but are not limited to:
•reviewing and approving goals and objectives relative to the compensation of our NEOs, evaluating our NEOs’ performance in light of these goals and approving the compensation of our NEOs,
•reviewing and incorporating stockholder preferencesconsidering input from stockholders with respect to compensation agreements with our NEOs,

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•overseeing and approving all equity-based award grants
making recommendations to the Board of Directors with regard to non-NEO compensation and equity-based awards, including those for non-NEOs, and
•producing a report on executive compensation to be included in our annual proxy statement.
The Compensation Committee is currently comprised of threefive members of the Board, each of whom is independent under the independence standards of the NYSE and a “non-employee director” under Section 16 of the Exchange Act, and an “outside director” for purposes of Section 162(m) of the Internal Revenue Code (the “Code”).Act. Generally, the Compensation Committee Chair is in charge of setting the schedule for the Compensation Committee’s meetings as well as the agenda of each meeting.
The Compensation Committee operates under a written charter, which is available on our website at investors.meritagehomes.com. We will provide a printed copy of the charter to any stockholder upon request.
The Compensation Committee has the sole authority to hire outside compensation advisors and consultants and to determine the terms, scope, fees and costs of such engagements. Since 2013,2018, the Compensation Committee has engaged The POE Group ("POE Group") annuallyPearl Meyer as its independent executive compensation consultant to provide an update on current compensation trends and to provide recommendations on the compensation packages of our NEOs.
The Compensation Committee determines executive compensation with respect to our NEOs independent of management. The Compensation Committee approves all grants of equity-based awards. For the NEOs, the number and type of equity award grants are determined or based on an employment agreement between the Company and the NEO, which may be periodically re-negotiated and revised, as approved by the Compensation Committee. For non-NEOs, management is responsible for recommending to the Compensation Committee the persons to receive grants of equity based awards and the nature and size of the proposed award.awards. Because management is responsible for the day-to-day operation of the Company, the Compensation Committee believes that management is in the best position to make this recommendation.
Compensation Committee Interlocks and Insider Participation
None of the members of the Compensation Committee is, or has been, an employee of Meritage or any of its subsidiaries. There are no interlocking relationships between Meritage and other entities that might affect the determination of the compensation of Meritage’s executive officers.
Nominating/Governance Committee
The Board of Directors has established a Nominating/Governance Committee, which directly reports to the Board of Directors and is responsible for:
•developing director qualifications and determining whether newly elected directors or prospective director candidates meet those qualifications,
•identifying individuals qualified to become Board members and recommending director nominees for the next annual meeting of stockholders,
•considering recommendations for director nominations received from stockholders,
•reviewing and recommending changes as needed to the Company’s Corporate Governance Principles and Practices and other corporate governance documents,
•addressing such items as management succession, including policies and principles for our CEO selection and performance review and succession in the event of an emergency or departure of the CEO,
•establishing and implementing director qualification standards, including policies regarding director tenure, retirement and succession,
•reviewing the charters of the Compensation Committee, Audit Committee, and Nominating/Governance Committee, ES&S Committee, Land Committee and any other committees, as well as the Lead Director Charter,
•assessing and monitoring, with Board involvement, the Board’s performance and the contributions and performance of individual directors,
•recommending nominees for the Compensation Committee, Audit Committee, Nominating/Governance Committee, ES&S Committee, and Land Committee,
•monitoring compliance with our Corporate Governance Principles and Practices, including stock ownership requirements for directors and NEOs, and
•promoting adherence to a high standard of corporate governance, ethics, and Company values.
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The Nominating/Governance Committee has the sole authority to retain and terminate any search firm used to identify director candidates, including sole authority to approve the search firm’s fees and other retention terms. The Nominating/Governance Committee operates under a written charter, which is available on our website at investors.meritagehomes.com. We will provide a printed copy of the charter to any stockholder upon request. Each member of the Nominating/Governance Committee meets the independence requirements of the NYSE.

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Land Committee
The Board of Directors has established a Land Committee, which directly reports to the Board of Directors.Board. The Land Committee is responsible for reviewing and approving/denying land acquisition transactions recommended by management in excess of a predetermined monetary threshold. The Committee is intended to function as an additional approval mechanism for executive management’s land acquisition approval policies and procedures.
As of the date of this filing, the Land Committee was comprised of Messrs.Ax, Oppel, Haddock and Bradford. The Land Committee is transactional in nature; accordingly, the frequency ofLand Committee does not have regularly scheduled meetings is not pre-determined,but rather are provided relevant materials for consideration and rather meetings only occurvoting when significant land transactions arise that require the Land Committee consideration.Committee’s authorization. Currently, no compensation is paid to any director for service on the Land Committee, and there is not a Land Committee chair. Each member of the Land Committee meets the independence requirements of the NYSE.
ES&S Committee
The ES&S Committee reports directly to the Board and is responsible for:
•assisting in setting the Company's general strategy with respect to ES&S matters, and considering and recommending policies, practices and disclosures that conform with the strategy,
•reviewing and collaborating with the Nominating/Governance Committee regarding the Company’s environmental, social, and governance reports and scores from relevant internal and external stakeholders, as available, and provide guidance on areas of opportunity with respect to ES&S matters,
•in coordination with the Nominating/Governance Committee, overseeing and approving annual updates to the Company's Human Rights Policy, Environmental Responsibility Policy, Responsible Marketing Policy and Vendor Code of Conduct, all of which can be found on our website at investors.meritagehomes.com;
•overseeing the Company's policies to protect the health and safety of employees, contractors, customers and the public and, as applicable, the environment, and review with management the quality of the Company’s procedures for identifying, assessing, monitoring and managing the principal environmental and social risks to the Company,
•in collaboration with the Chief People Officer, overseeing the Company’s policies and practices promoting diversity and inclusion,
•reviewing and advising the board on sustainability goals and long-term ES&S objectives,
•monitoring environmental, social and political trends as well as major global legislative and regulatory developments or other public policy issues and making recommendations to the board, as appropriate, on adjustment of Company policies and practices to address such trends and issues,
•overseeing the accounting, reporting and disclosure with respect to ES&S matters, such as climate change and greenhouse gas emissions, including data collection and compliance with any applicable laws,
•reviewing and approving the Company's annual ESG report, Task Force on Climate-Related Financial Disclosures ("TCFD") report and other similar reports, and
•consulting with the Compensation Committee on matters related to compensation targets that may be linked to ES&S objectives and metrics.
The ES&S Committee operates under a written charter, which is available on our website at investors.meritagehomes.com. Each member of the ES&S Committee meets the independence requirements of the NYSE.
Director Nomination Process
Director Qualifications. The Nominating/Governance Committee will evaluate prospective nominees using the standards and qualifications set forth in our Corporate Governance Principles and Practices and in our criteria for new directors. Prospective nominees must meet these qualification requirements and should have the highest professional and personal ethics and values, as well as broad experience at the policy-making level in business, government, education or public interest. Prospective nominees shouldmust be committed to enhancing stockholder value and shouldmust have sufficient time to devote to carrying out their duties and to provide insight based upon experience, talent, skill and expertise appropriate for the Board. Each prospective nominee must be willing and able to represent the interests of our stockholders.
Identifying and Evaluating Nominees for Directors. The Nominating/Governance Committee utilizes a variety of methods for identifying and evaluating nominees to serve as directors. The Nominating/Governance Committee assesses the current composition of the Board, of Directors, the balance of management and independent directors and the need for Audit Committee and other expertise in its evaluation of prospective nominees. In the event that vacancies are anticipated, or otherwise arise, the Nominating/Governance Committee may seek recommendations from current Board members, professional search firms,
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outside legal, accounting and other advisors, or stockholders in order to locate qualified nominees. The Nominating/Governance Committee also evaluates each candidate in the context of maintaining and creating a diverse Board, as previously discussed. After completing its evaluation, the Nominating/Governance Committee will make a recommendation to the full Board of Directors as to the persons who should be nominated by the Board, of Directors, and the Board will determine the nominees after considering such recommendations. Currently, the Board has retained a search firm with a search underway to replace potential director retirements in the near term.
Stockholder Recommendations. The policy of the Nominating/Governance Committee is to consider properly-submitted stockholder recommendations for candidates for membership on the Board of Directors as described below. In evaluating such proposals, the Nominating/Governance Committee seeks to achieve a balance of knowledge, experience and capability on the Board and to address the membership qualifications and criteria described below.above. Any stockholder recommendations proposed for consideration by the Nominating/Governance Committee must include the nominee’s name and qualifications for Board membership and should be submitted to:
Meritage Homes Corporation
8800 East Raintree Drive
Suite 300
Scottsdale, Arizona 85260
Attn:  Secretary
The Secretary will forward all recommendations to the Nominating/Governance Committee.
Stockholder Nominations. Our bylaws also permit stockholders to nominate directors for election at an annual stockholder meeting. For a description of the process for submitting such nominations for consideration at next year’s annual meeting, please see “Stockholder Proposals, Director Nominations and Other Items of Business” on page 5961 of this proxy statement.
Proxy Access. In February 2017, we amended ourOur bylaws to permit an eligible shareholder,stockholder, or a group of up to 20 shareholders,stockholders, that has continuously owned at least three percent of the Company’s outstanding shares of common stock for three years to include in the Company’s proxy materials director nominations of up to 20% (rounded to the nearest whole number) of the number of Directors constituting the class up for election at any annual meeting. For a description of the process and deadlines for submitting such nominations for consideration at next year’s annual meeting, please see “Stockholder Proposals, Director Nominations and Other Items of Business” on page 5961 of this proxy statement.
Director Orientation and Continuing Education
It is the policy of the Board that all new directors should participate in an orientation program sponsored by the Company. This orientation will beis designed to familiarize new directors with the Company’s strategic plans, its significant financial, accounting and risk management issues, its compliance programs, its Code of Ethics, its principal officers, its internal audit function, and its independent auditors.registered public accounting firm. In addition, the Board encourages each director to attend prominent continuing

27 MERITAGE HOMES| 2018 Proxy Statement
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS


education programs. The Company will pay for the director’s tuition and reasonable and customary travel expenses to attend continuing education programs.
Executive Sessions of Independent Directors
Our Corporate Governance Principles and Practices dictate that the non-management members of the Board of Directors will meet in executive session at least quarterly outside the presence of directors that are employees or officers of the Company. The non-management directors met in executive session four times during 2017.2022. Peter L. Ax is our Lead Independent Director and presides over these executive session meetings.


Code of Ethics
We are committed to conducting business consistent with the highest ethical and legal standards. The Board of Directors has adopted a Code of Ethics, which is applicable to all employees, including our senior and executive management and our directors. Thedirectors, and a Vendor Code of Conduct, which is applicable to all contractors, subcontractors, vendors and partners. Both the Code of Ethics and the Vendor Code of Conduct are available on our website at investors.meritagehomes.com and we will provide a print copy to any stockholder upon request..
Meritage Stock Pledging Policy
In February 2013, the Nominating/Governance Committee approved a modification to the Company’s securities trading policySecurities Trading Policy prohibiting all future pledging of the Company’s equity securities by our employees, NEOs and directors. In connection with this policy, the Company adopted a grandfather provision relating to existing pledges. AsNone of the date our modified policy was adopted, only Messrs. Hilton and Sarver had outstanding pledges. Our grandfather provision exempts existing pledges and continuationCompany's NEOs or replacements thereto; provided, however, that with respect to these existing pledges (or continuations or replacements thereof) the number of sharesdirectors currently have pledged may not exceed the greater of (i) two-thirds of the total number of Meritage shares beneficially owned by Mr. Hilton or Sarver, as the case may be, or (ii) 200,000 shares. In establishing these grandfather provisions, the Board considered the particular circumstances of Mr. Hilton and Mr. Sarver, the founder of theany Company and an original board member, respectively, both of whom have a significant ownership in the Company’s equity securities.stock.
Anti-Hedging Policy
We have a securities trading policy thatOur Securities Trading Policy sets forth guidelines and restrictions on transactions involving our stock, which are applicable to all employees, including our NEOs and directors. Among other things, our policy prohibits all types of hedging transactions,
28 MERITAGE HOMES| 2023 Proxy Statement
CORPORATE GOVERNANCE PRINCIPLES AND BOARD MATTERS




including, but not limited to, purchases of stock on margin, short sales, buying or selling puts or calls and similar transactions involving any derivative securities. If allowed, these types of transactions could enable employees to own Company stock without the full risks and rewards of ownership. When that occurs, employees may no longer have the same objectives as the Company’s other stockholders and therefore such transactions involving Meritage stock are prohibited.
Communications with the Board of Directors
Interested persons may communicate with the Board of Directors by writing to our Lead Independent Director at the address set forth on page 2.2. The Lead Independent Director will disseminate the information to the rest of the Board at his discretion.



MERITAGE HOMES | 2018 Proxy Statement 28
COMPENSATION DISCUSSION AND ANALYSIS


Compensation Discussion and Analysis
The following discussion and analysis should be read in conjunction with the “Summary Compensation Table” and related tables that are presented immediately following this discussion.
The purpose of this compensation discussion and analysis (“CD&A”) is to provide information about each material element of compensation that we pay or award to, or that is earned by, our NEOs. For our 20172022 fiscal year, our NEOs were:
Steven J. Hilton, Chairman and•Phillippe Lord, Chief Executive Officer ("CEO")
•Hilla Sferruzza, Executive Vice President ("EVP"), Chief Financial Officer ("CFO")
C. Timothy White,•Steven J. Hilton, Executive Vice President,Chairman ("EC")
•Clint Szubinski, EVP, Chief Operating Officer ("COO")
•Malissia Clinton, EVP, General Counsel ("GC") and Secretary
Phillippe Lord, Executive Vice President, Chief Operating Officer
•Javier Feliciano, Executive Vice President,EVP, Chief Human ResourcesPeople Officer ("CPO")
For 2022, we have voluntarily included Javier Feliciano as a named executive officer. Mr. Feliciano rounds out our core executive management team and we believe it is beneficial and transparent for investors to be presented with, and understand, the compensation program of our full core executive management team. In addition, Mr. Feliciano was an NEO in 2021 and in prior years. This CD&A addresses and explains the numerical and related information contained in the summarySummary Compensation Table and other executive compensation tables, and includes actions regarding executive compensation that occurred during 2017,2022, including the award of bonuses related to 20172022 performance, and the adoption of any new, or the modification of any existing, compensation programs, if applicable.

2017 EnvironmentExecutive Summary
In 2017 the housing market experienced solid growth as a result of a strong economy and a favorable demand environment, particularly as Millennials have increasingly entered the home buying market. Historically, first-time buyers have made up a significant percentage of homebuyers. That buyer segment had been absent in recent years as Millennials accumulated large amounts of student debt in a stagnant economy and were unable to save for down payments. The economy's improvement along with job growth and these young adults reaching a phase of life where many are now part of a dual income household has made homebuying within reach again. Entry-level product is also attracting the second largest segment of the population, the baby-boomers, who are looking to downsize due to life events.

We remain focused on positioning ourselves in well-located and highly-desired communities in many of the top residential real-estate markets in the United States where we are now focused on product offerings targeting these first-time buyer segments. We believe we successfully differentiate ourselves from our competition by offering a lineup of extremely livable and efficient plans featuring new designs that highlight the benefits of our industry-leading energy-efficient building features and technology which we believe are particularly appealing to the first-time buyer. Over the last couple of years we have been executing a strategy to address that demand by acquiring communities and designing homes that can be delivered at a lower cost by simplifying our product and construction processes, starting more spec homes to allow buyers to move in quicker, and by enhancing and making the entire home buying experience easier for our customers. The growth and profitability of Meritage is dependent on executive management’s vision and actions to implement and support these strategic goals and we feel we have taken, and continue to take, appropriate steps for Meritage to be well-positioned for success.
Executive Summary
Meritage Homes is committed to building long-term stockholder value. Accordingly, our NEO compensation program is designed to be largely performance driven. At our 20172022 Annual Meeting of Stockholders, the Company’s stockholders approved the compensation of our NEOs (on an advisory basis) by approximately 96%58% of total votes cast, indicating thatas previously discussed in “—Advisory Vote to Approve Compensation of our Named Executive Officers (Proposal No. 3)” on page 8. Historically, our stockholders werehave been in agreement with our Compensation Committee and its direction of setting compensation arrangements based on performance metrics that are in line with the goals of our stockholders.stockholders, and we are committed to regaining that stockholder agreement. A summary of our compensation packages is discussed further in this proxy in the section titled “Compensation Program.”

Subsequent to the 2022 Meeting, we sought to engage with our top 30 institutional stockholders, who accounted for over 73% of our total shares outstanding at December 31, 2022. Seven of the top 30 stockholders, over half of whom voted against the 2022 Say on Pay and whose shares represented 47% of the top 30 ownership, welcomed a conversation with members of our Board and executive management. From these investor engagement efforts, we learned and determined the following:
•The majority of stockholders voting against the proposal expressed that they based their vote on a third-party proxy advisory recommendation, which was critical of the Board-approved, one-time payment made in 2021 to Mr. White.
•Regarding the one-time payment in 2021 to Mr. White, our former General Counsel, stockholders were interested in additional context around his separation in light of his significant contributions to Meritage and the payment to induce the accelerated timing of his retirement. The Board appreciates the view of some that the payment was discretionary. The stockholders who responded to our outreach efforts also appreciated how the inducement facilitated the company’s successful process for recruitment and transition of an important NEO position, as well as its contribution to long-term shareholder value creation.
•Appreciating our long track record of fair executive compensation and alignment of pay with performance, the stockholders we spoke with supported our overall compensation plan design and pay-for-performance practices.
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•The stockholders expressed that outside of another non-recurring event, they do not have significant negative concerns about the existing structure of our compensation program. We accept the feedback from our stockholders. No such payments were paid during 2022, and none are contemplated to be paid in any future period. We will continue to limit discretionary payments and incorporate the expectations of stockholders when structuring or negotiating severance payments and benefits.

Our Say on Pay support has exceeded 90% of the votes cast for the ten years prior to the 2022 annual meeting and our goal is to return to this high level of support from our stockholders on the Say on Pay proposal in this current year and beyond.

20172022 Business Highlights
2017During the second half of 2020 and throughout all of 2021, the homebuilding industry experienced unprecedented growth. The expansion continued in the first quarter of 2022, but the market steadily weakened throughout the rest of 2022 due to rapidly rising interest rates, uncertainty about current economic conditions and changes in personal finances. We were able to adapt quickly to the market changes by increasing incentives and offering interest rate locks and buy downs to offset the increases to monthly home mortgage payments for our customers. While this cool down in the back half of 2022 resulted in a year-over-year decline in order volume, 2022 was anotherstill a record year in many of growthour key financial and progress on many strategic fronts for Meritage Homes.operational metrics. Below is a summary of some of the significant accomplishments achieved in 2017:2022:
Generated highest pre-tax net income in over a decade, with 14% year-over-year growth.
•Grew total home closing revenue to $3.2$6.2 billion in 2017,2022, up 6%22% over 2016. 2021, on an 11% higher average sales price on closings. 
Expanded•Closed 14,106 homes, our highest volume in Company history and a 10% increase over the numberprior year.
•Improved home closing gross margin to 28.6%, an 80 basis point improvement year-over-year, and a Company record.
•Achieved the Company's lowest ever SG&A as a percentage of communities targeting the growing first-time homebuyer segment to approximately 30%revenue of our total active communities8.3%, a 90 basis point improvement year-over year.
•Generated 35% year-over-year growth in earnings before income taxes.
•Achieved Company-high diluted earnings per share of $26.74 per share, a 39% increase over 2021.
•Strengthened balance sheet leverage with debt-to-capital and net debt-to-capital ratios of 22.6% and 6.8% at December 31, 2017.
Increased our lots under control by 15%2022, compared to prior year to 34,319 lots27.6% and 15.1% at December 31, 2017.
Managed our net2021. Net-debt-to-capital is a non-GAAP measure. For a reconciliation to the debt-to-capital ratio, withinthe most comparable GAAP measure, please see our target ofAnnual Report on Form 10-K for the low-to-mid 40% range while still growing our balance sheet to address market demand, reporting 41.4% atyear ended December 31, 2017.2022 under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Financial Resources—Financing Cash Flow Activities.”
•Ended the year with 271 actively selling communities, a 5% increase over 2021.
Our executive compensation program is designed to be driven with a strong focus on pay-for-performance. In 2017,2022, more than half of the compensation program for our NEOs was based on various performance metrics that are tied to Meritage’s financial and operational goals. The following graph illustrates CEO compensation as it relates to the performance of the Company over the last three years.

30 MERITAGE HOMES| 2023 Proxy Statement
chart-f1ba8c1449c8569ca99.jpg
*
Before deduction of CEO total compensation (as reflected in the Summary Compensation Table). COMPENSATION DISCUSSION AND ANALYSIS

In addition

mth-20230323_g19.jpg
(1) Before deduction of CEO total compensation (as reflected in the Summary Compensation Table).
(2) 2020 CEO compensation reflects Mr. Hilton, who served as CEO that year; 2021 and 2022 reflect compensation for Mr. Lord.

2022 Environmental, Social, and Sustainability Highlights
Meritage is committed to sustainability through the homes we build, the communities in which we live and work, and the ways we conduct ourselves every day. We strive to integrate an environmental focus into all aspects of our business—from land acquisition and development to the design and construction of homes to our financial services offerings, which include title and operating successes,escrow, mortgage and insurance services. At Meritage, Homeswe also believe corporate social responsibility is committedimportant for the long-term sustainability of the business. We believe that fostering a culture that champions diversity, equity and inclusion ("DE&I") allows us to building every homebe an employer of choice to meet or exceed ENERGY STARour people and a builder of choice to our customers and trade partners. We take pride in being an organization driven by ethics and living by our core values and our promise to deliver a Life.Built.Better.® standards, with many We promote the long-term interests of stakeholders and customers and focus on the transparency and accountability of Meritage’s Board of Directors, executive management, our employees and trade partners.
Philanthropy
One of our communities greatly surpassing those levels. The Environmental Protection Agency has recognized Meritage Homes as an ENERGY STAR Partner of the Year every year since 2010. For the fifth consecutive year, in 2017 Meritage received the ENERGY STAR® prestigious Partner of the Year for Sustained Excellence Award in recognition of our ongoing industry leadership in advancing energy-efficient building standards. In 2017,core values is "Start With Heart" and we expanded our innovation platform to include home automationdo so through our new M.Connected Home Automation Suite®. This technology includes features that allow homeowners to monitor and control key components of their homes, such as Wi-Fi enabled lighting, video doorbells and smart door locks.
We have also enjoyed successes in establishing Meritage as a company that gives back and has been recognized for such efforts.various initiatives. Since 2013, Meritage has partnered with Operation Homefront to provide newly-built mortgage-free homes to military families through its Permanent Homes on the Homefront program.for Veterans program and we built and donated three homes through this program in 2022. In addition, in 2022 we donated over $1.1 million through the Meritage CaresFoundation to non-profit organizations that support food insecurity in the U.S., tree planting efforts and DE&I initiatives, just to name a few, and made corporate contributions of $1.4 million to fund education opportunities. Our employees donated thousands of man-hours and significant financialalso donate their time to support tolocal organizations, including Ronald McDonald House, Habitatpacking meals for Humanity, numerous local food banksNo Child Hungry, and other local and nationalwe are proud to offer a benefits program that provides paid time off for volunteering with charitable organizations including those focused on hurricane relief efforts as a result of the unprecedented weather in 2017, many of these organizations we plan to continue to support through the Meritage Cares Foundation.

organizations.
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COMPENSATION DISCUSSION AND ANALYSIS


Diversity, Equity and Inclusion
Meritage Homes is committed to creating and cultivating a diverse team, fostering an inclusive culture and creating a workplace environment where our team members can reach their full potential in support of organizational goals. We seek to increase and retain the demographic and skill diversity of our workforce at all levels, develop meaningful relationships and collaborate effectively with diverse customers, trade partners, and the communities we serve. We have a robust talent assessment and succession planning model designed to help identify and develop talent and provide a roadmap for promotion of identified employees. Our culture is guided by our core values through which every employee is strongly encouraged to embrace opportunities to develop and grow their careers.

mth-20230323_g20.jpg

At December 31, 2022, we had 1,921 full-time employees. Of our entire employee population at December 31, 2022, approximately 40% were female and 26% were people of color. We are proud of the diversity in our team and are committed to the ongoing and intentional work to achieve inclusive excellence, including the long-term goals of attracting diverse talent and forming strategic relations. We are dedicated to learning, improving our practices and challenging our leaders and employees to recognize and leverage our differences for the greater good of the team and the organization. We promote an open-door policy where individuals are encouraged to voice concerns which are promptly addressed. In 2022 our DE&I program included the following efforts:
•Leveraged an internal DE&I council comprised of both field and corporate leaders to support our DE&I efforts and serve as collaborative partners to senior management as we plan and execute our DE&I initiatives.
•Donated to multiple nonprofit organizations supporting ongoing DE&I and educational efforts focused on underrepresented groups, including the National Association of Women in Construction and the Society of Women Engineers. We also established scholarship funds at Historically Black Colleges & Universities as well as Hispanic Servicing Institutions. We also expanded our partnership with Building Talent Foundation, a non-profit organization whose mission is to advance the education, training and career progression of young professionals, especially those from underrepresented groups in residential construction,
•Ongoing recruiting efforts designed to attract diverse talent, including continued relationships with INROADS, a non-profit organization focused on career development of underrepresented talent, and WayUp, an organization that matches candidates with employers based on the candidate's interests, experience, and skills, to broaden our recruitment activities to capture a wider based of female, minority, and underrepresented groups.
•Conducted a company-wide engagement survey to identify our successes and areas of opportunity as they relate to employee's feelings of connectedness and belonging.
•Provided several educational and engagement opportunities for our leaders and employees focused on a culture of inclusion and building DE&I skills and capabilities.
Environmental, Social and Sustainability Practices
Energy Efficiency. Meritage Homes has been a leader in incorporating innovation in every home we build, employing industry-leading techniques and technologies aimed at setting the standard for sustainable and energy-efficient homebuilding. At a minimum, we construct every home to meet or exceed ENERGY STAR® standards. Every new Meritage home comes standard with spray foam insulation, the MERV-13 air filter, an advanced air filtration system, ENERGY STAR® certified appliances, and a multispeed heating, ventilation and air conditioning ("HVAC") system that is designed to operate more efficiently than traditional HVAC, allowing owners to better manage the comfort of their home while reducing their operating costs and environmental impact. We proudly delivered 14,106 homes in 2022 that we expect will be ENERGY STAR® certified, of which 100% of our homes in California included solar panels.

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HERS Score
mth-20230323_g21.jpg
Year after year, we strive to improve the energy efficiency of our homes through better building processes and selection of construction materials and features inside the home. These efforts reduce the energy consumption and greenhouse gas emissions of our homes compared to a similar-sized traditional new U.S. home, which creates energy savings and lower utility bills for our homeowners. As a result, we have received various national and regional awards in recognition of our efforts, including:
•2022 EPA's ENERGY STAR® Partner of the Year for Sustained Excellence for the ninth year;
•2021 - 2022 EPA's Indoor airPLUS Leader Award;
•2013 - 2022 EPA's ENERGY STAR® Market Leader Award for Certified Homes; and
•2020 Builder of the Year for Green Home Builder.

In addition to the ENERGY STAR® standard, the Home Energy Rating System ("HERS") is another industry standard by which a home's energy efficiency is measured. HERS is the nationally recognized system for inspecting and calculating a home's energy performance, according to the Residential Energy Services Network ("RESNET"). Third-party RESNET-certified companies assess and rate the energy efficiency of every new Meritage Home. The index graph to the left depicts HERS ratings of typical existing homes and the average Meritage home. In 2022, Meritage delivered homes with an average HERS score of 53, which implies 47% greater energy efficiency and lower monthly energy bills for the homeowners than the RESNET Reference Home, a standard based on a HERS Index score of 100 for a typical home built in 2006.

We design and build our homes to maximize energy efficiency, as evidenced by our industry-leading low HERS score. We are leading the way in sustainable homebuilding.
Responsible Supply Chain. Responsible sourcing and the use of sustainable materials are important to our operations. Our raw materials consist primarily of lumber, concrete, drywall, roofing materials and similar construction materials, and are frequently purchased on a national or regional level. However, because such materials are substantially comprised of natural resource commodities, Meritage expects responsible management of social and environmental risks in our supply chain. We work with our partners to ensure they understand our needs and our Company culture and conduct. Our contracts require that our suppliers comply with all laws, environmental regulations and safety and labor practices pertaining to their products and work as well as follow our Vendor Code of Conduct and we monitor our suppliers' compliance with zoning, building and safety codes. Where possible, we use recycled building materials and sustainably-sourced products. Certain of our building materials are sourced locally to reduce transportation and the related green-house gas emissions.

As a major purchaser of lumber, we are committed to sustainable forestry. Responsible forest management is important in order to maintain sustainable natural resources. Proper selection of trees to harvest can help with forest regeneration. We have lumber partners who provide us Sustainable Forest Initiative ("SFI") certified wood. Our wood varieties most often come from inland areas of the western US and Canada rather than coastal areas with endangered wood varieties.
We specify that quality durable materials be used in the construction of our homes to ensure the home carries enduring value for our customers. Spray foam insulation and vinyl windows create a tight long-lasting housing envelope, which help ensure long-lasting value. We seek to minimize the use of wood products in our homes, such as replacing wood flooring with engineered vinyl panels.
Meritage continues to support the advancement of energy efficient and sustainable home building practices in the U.S. To further these principles, Meritage engages in stakeholder discussions across the landscape of the home building industry, elected officials, and regulatory bodies at the federal, state, and local levels. We are a founding member of the Institute for the Building Envelope and we collaborate and participate with several trade associations and councils, including the International Code Council, Housing Innovation Alliance, California Building Industry Association, Florida Volume Builders Council, Policy Advisory Board of the Harvard Joint Center for Housing, RESNET, and Leading Builders of America.
Climate Change. In 2022, Meritage became the first U.S. public production builder to issue an inaugural TCFD report and to join approximately 3,900 other institutions in becoming an official TCFD supporter. We have been establishing a baseline foundation for our Company’s climate data by reporting our annual greenhouse gas emissions ("GHG") inventory since 2019. Our GHG inventory is developed in accordance with the GHG Protocol Corporate Accounting and Reporting Standard, using both spend-
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COMPENSATION DISCUSSION AND ANALYSIS

based and activity-related data. Meritage’s operations in the homebuilding sector generate direct and indirect GHG emissions. By evaluating and measuring the carbon footprint of our business operations, job sites, and value chain, we are gaining a better understanding of the changes that impact our annual emissions. Since scope 3 (the indirect impact of our value chain) is the majority of our GHG emissions each year, we are collaborating with our vendors to further determine where we can partner and make the greatest improvements to reduce our GHG emissions in the future.
We provide a more comprehensive analysis of our DE&I and ESG efforts, including the standards and metrics by which they are measured, annual GHG emissions inventory, and equal employment opportunity ("EEO-1") data in our ESG report, which is located within the Investor Relations area of our website. Our ESG report does not constitute soliciting material and should not be deemed filed or incorporated by reference herein.

Compensation Philosophy and Objectives
Our executive compensation program is designed to drive and reward superior corporate performance both annually and over the long termlong-term while simultaneously striving to be externally competitive.competitive amongst our peer group. We continually review our executive compensation program to ensure it reflects good governance practices and is in the best interests of stockholders. Since 20132018, the Compensation Committee has engaged POE GroupPearl Meyer as its independent external compensation consultant to evaluateconsultant. Pearl Meyer evaluates and makemakes recommendations regarding the terms of our NEO and Board compensation programs as they relate to creating stockholder value as well as remaining competitive in the marketplace with the changing trends and levels in NEO compensation, while meeting the below core objectives:objectives. We do not engage Pearl Meyer for any other advisory services.
Pay for Performance
A substantial portion of the total potential compensation for our NEOs is intended to be variablevariable/at risk on a pay-for-performance basis. The terms of the performance-based compensation contemplated in each respective NEOsNEO's employment agreement was based upon an assessment performed by POE GroupPearl Meyer of external market data to ensure that the compensation formula is competitive relative to the compensation paid by companies with which we compete for executive talent. This compensation is derived based on (i) the performance of the Company as a whole, as measured against our peer group and (ii) the NEOs role in the attainment of the Company’s performance goals.
Stock Ownership
We are committed to utilizing our compensation program to increase executive stock ownership over time. We believe that equity ownership directly aligns the interests of our executivesNEOs with those of our stockholders and helps to focus our executives on long-term stockholder value creation. We award restricted stock, restricted stock units and performance share awards to our NEOs, as we believe such awards provide our NEOs with an incentive to continue to increase long-term stockholder value, even during periods of declining stock prices. We believe the granting of equity awards is an important retention tool and is widely used in our industry.
Recruiting and Retention
Due to the competitive nature of our industry, we are committed to providing total compensation opportunities that are competitive with, though not identical to, the practices of other public homebuilders within our peer group. We intend for our compensation program to be sufficiently aligned with industry practices so that we can continue to attract and retain outstanding executives who are motivated to help us achieve our mission.
Compensation Peer Group
As a member of the homebuilding industry, we predominantly compete for executive talent and have historically compared ourselves to other companies in our industry. There are a limited number of homebuilders that have revenue and market capitalization similar to ours. Therefore, the Compensation Committee, with the assistance of POE Group,Pearl Meyer, has established a peer group of comparably sized companies selected from the homebuilding industry, with organizational structures similar to ours such as wellbeing a publicly traded company, operations limited to the United States, and building single family housing as the building products industry. The majority of the peer group companies fall within the following parameters:
0.4 times to 2.5 times our revenues, and
0.25 times to 4.0 times our market capitalization.    their core business.
The peer group companies that were used in 20172022 for executive compensation benchmarking and performance benchmarking are set forth below. We believe that this peer group provides an appropriate benchmark comparison for our Company.
lArmstrong World IndustrieslMartin Marietta Materials
lBeazer Homes USA, Inc.lOwens Corning    M.D.C. Holdings, Inc.
lCalAtlantic GroupCentury Communities, Inc.lM/I Homes, Inc.
lD.R. Horton, Inc.lNVR, Inc.
lHovnanian Enterprises, Inc.lPulte Group, Inc.
lFortune BrandsKB HomelTaylor Morrison Home Corporation
lKB HomeLennar CorporationlToll Brothers, Inc.
lM.D.C. HoldingsLGI Homes, Inc.lTRI PointePoint Group,
lM/I HomeslUSG Inc.




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COMPENSATION DISCUSSION AND ANALYSIS






In addition to the peer group listed above being used for executive compensation benchmarking, the Compensation Committee established aalso used this same peer group for the total shareholder return ("TSR") portion of performance basedperformance-based long-term incentive awards that includes only homebuilders based on the recommendations of POE Group. The TSR peer group for 2017 is set forth below:
lBeazer Homes USAlPulte Group
lCalAtlantic GrouplTaylor Morrison Home
lKB HomelToll Brothers
lM.D.C. HoldingslTRI Pointe Group
lM/I Homes

in 2022.
While market data is an important factor utilized by the Compensation Committee when setting compensation, it is only one of multiple factors considered, and the amount paid to each executiveNEO may be more or less than the composite market predicted value based on the performance of the Company and the executive,NEO, the roles, experience level and responsibilities of the executive, experience level of the individual,NEO, internal equity and other factors that the Compensation Committee deems important.

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Compensation Best Practices
The best practices evidenced by our compensation programs and processes include:
Compensation Best Practices

The best practices evidenced by our NEO compensation programs and processes include:
WE DOWE DO NOT
a
Pay for performance by requiring a significant portion of the total compensation of our NEOs be determined based on performance tied to strategic objectives.
rProvide perquisites for our NEOs other than those limited to auto allowance, reimbursement of certain insurance premiums and other limited benefits.
aHave executive Stock Ownership Requirementsstock ownership requirements in place set at a multiplier of base salary.rReprice or replace stock options and other equity awards.
aHave a clawback policy for our NEOs requiring the recoupment of incentive bonuses in the event of a restatement of financial results resulting from willful misconduct or gross negligence of the applicable NEO.rAllow hedging.
aEngage an independent compensation consultant whothat reports directly to the Compensation Committee to provide an update on current compensation trends and to provide recommendations on our NEOs’ current compensation packages.rAllow pledging, subject to certain limited grandfather provisions.pledging.
aDoubleHave double trigger cash severance based upon a change-in-controlchange of control of the Company.rProvide tax gross-ups applicable to change-in-controlfor change of control and severance payments.
Our executive compensation policies and practices are designed to align our NEOs’ long-term interests with those of our stockholders via a pay-for-performance model. The charts below depict the 20172022 percentage of compensation for our CEO and other NEOs that is fixed versus performance-based (fromfrom the summary compensation tableSummary Compensation Table on page 45):47:


chart-f093232face5547d81aa14.jpgchart-e0dec51f829e5a3abc2a14.jpgmth-20230323_g22.jpgmth-20230323_g23.jpg
*    Represents average for NEOs for the year ended December 31, 2022, other than the CEO.
** Includes fair value of performance share awards granted (at target level) and actual non-equity incentive plan compensation paid.


36 MERITAGE HOMES| 2023 Proxy Statement
*Represents average for current NEOs other than the CEO.
**Includes fair value of performance share awards granted (at target level) and actual non-equity incentive plan compensation paid.



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Independent Compensation Consultant
In accordance with its charter, the Compensation Committee has the sole authority to obtain advice and assistance from consultants, legal counsel, accounting and other advisers as appropriate. The Compensation Committee has the sole authority to retain and terminate any compensation consultant, counsel or adviser and to determine and approve the terms, costs and fees for such engagements. Since 2013,2018, the Compensation Committee has engaged POE GroupPearl Meyer to serve as its independent executive compensation consultant. When engaging an executive compensation consultant takingthe Compensation Committee takes into consideration (i) the independence of and similarother factors pertaining to POE Groupthe consultant as required by the New York Stock Exchange (NYSE), the Securities and Exchange Commission (SEC)NYSE, SEC and other applicable rules and regulations. Upon consideration of these factors, the Compensation Committee has concluded that engaging POE Group didthe engagement of Pearl Meyer does not present any conflicts of interest.
POE Group provided informationPearl Meyer is a leader in the executive compensation consulting industry and provides information and advice regarding compensation philosophy and strategy; recommended peer group selection criteria as well as recommended potential peer companies; and consulted with the Compensation Committee on both long-term and short-term incentive compensation.

Compensation Program
The key components of our executive compensation program are base salary, annual incentive cash compensation and long-term equity incentive compensation. In addition, our NEOs have the opportunity to participate in our company-wide 401(k) plan, a non-qualified deferred compensation plan, and to receive limited certain personal benefits, as described below.on the next page. The employment agreements of our CEO and other NEOs are further described in this proxy under the section “—Employment Agreements in Effect for 2017.2022.”
In recent years, the Compensation Committee undertook a holistic review of theOur executive compensation program with the assistance of POE Group. The executive compensation program wasis designed based on the following strategic principles:
•Alignment with key outcomes of our business strategies;
•Appropriate balance of short- and long-term incentive award opportunity;
Provision of market-competitive•Market-competitive total compensation opportunity within our industry and peer group;
•Appropriate alignment with our stockholders by delivering a significant percentage of total compensation opportunity through equity;equity and including goals that are measured by total shareholder return;
•Setting a total compensation package where a significant percentage of total compensation is at risk;
•Transparency in the communication of plan design and performance goals to enhance understanding; and
•Adherence to sound governance practices, including the prudent management of compensation risk.
Based on the results of the analysis, the components of our NEO compensation program are as outlined below.
Base Salary
The purpose of the base salary is to provide a fixed amount of cash compensation that is not variable and is generally competitive with market practices. Consistent with industry practice and our pay-for-performance objective, the base salary for each of our NEOs is designed to account for only a portion of their overall total target compensation. As comparedWe target our NEO base salaries to be competitive with our compensation peer group, we target our NEO salaries to be commensurate with other public homebuilders.group. We believe the NEO base salaries are appropriate based on the officers’ roles, responsibilities, experience and contributions to the Company, as well as compared to market data.
Annual Cash Incentive Compensation ("Non-Equity Incentive Plan")
We believe our Non-Equity Incentive Plan focuses our NEOs on the most important short-term measures of our business, establishes a clear connection between performance and earned compensation, and provides greater transparency to our stockholders as to the operation of our Non-Equity Incentive Plan. Each goal represents a fixed percentage of total potential non-equity incentive compensation with each goal assessed separately from the others. The annual incentive compensation is designed to comply with the requirements of Section 162(m) of the Code to allow for the tax deductibility of incentive compensation paid to our NEOs.
The specific details of each NEO’s 20172022 annual cash incentive compensation are further described under the section “—Employment Agreements in Effect for 2017”2022”.

MERITAGE HOMES | 2018 Proxy Statement 34
COMPENSATION DISCUSSION AND ANALYSIS


Discretionary Bonuses
Discretionary bonuses may be awarded based on specific achievements of an individual beyond those of the performance measurements included in the annual incentive compensationNon-Equity Incentive Plan calculations, subject to approval by Executivethe Compensation Committee. For 2017, there were noAlthough contemplated within the compensation program for our NEO's, the use of discretionary bonuses awardedhas been and is expected to our NEOs.continue to be very limited.
MERITAGE HOMES | 2023 Proxy Statement 37
COMPENSATION DISCUSSION AND ANALYSIS

Long-Term Equity Incentive Awards
Long-term incentivesequity incentive awards are intended to provide compensation opportunities based on the creation of stockholder value and an increase in our stock price. In 2017, all of the long-term equity awards granted to our NEOs contained at least one performance metric as further discussed below. The employment agreements in effect for 2017 also2022 for our NEOs allow for grants of performance-based restricted stock units to be granted without ("performance criteria, however no such awards were granted in 2017. Theshare awards") and time-based restricted stock unit and performance share awards generallyunits, both of which have a three-year cliff vesting schedule.
In connection with our equity awards, we have also adopted stock ownership requirements as further discussed below in the section “—Security Ownership Requirements.”
The Compensation Committee believes that equity awards provide a strong long-term incentive for our NEOs (and other officers and employees) that, along with their stock ownership, helps to align the interests of management with our stockholders. The Compensation Committee believes that these equity-based awards provide the opportunity for our executivesNEOs to benefit from strong equity performance and, particularly in the case of the restricted stock and restricted stock unit awards, the NEOs focus on balancing stability and preservation of stock value against being incentivized to potentially take on an imprudent level of additional risk to drive stock appreciation with more contingent equity awards such as stock options. The Company and the Compensation Committee also believe that an appropriate mix of cash compensation and non-cash compensation in the form of equity awards is necessary and appropriate because, among other reasons, equity-based awards do not require the use of our working capital. The Compensation Committee is mindful of the fact that equity awards represent an expense under generally accepted accounting principles and a cost to the Company and its stockholders in the form of dilution. Accordingly, we seekthe Company seeks to achieve an appropriate balance between cash and non-cash compensation such that management isthe NEOs are appropriately incentivized, our working capital and financial results are minimally affected, and our stockholders do not experience undue dilution.
Other Compensation
The Compensation Committee does not believe in the extensive use of perquisites as a component of executive compensation. The Compensation Committee believes that the perquisites provided to our NEOs (above those received by all employees or officers in general) are limited but help maintain the competitiveness of our compensation package as compared to our peer group companies. The types of perquisites we provide to our NEOs generally consist of car allowances, and enhanced life and disability or long-term care insurance.
Limitations on Deductibility of Compensation
Prior to the Tax Cuts and Jobs Act (“Tax Reform”) that was signed into law December 22, 2017, Section 162(m) of the Internal Revenue Code placed a $1 million limit on the amount of compensation the Company could deduct in any one year for compensation paid to our NEOs (other than our CFO) unless the compensation qualified as “performance-based compensation.” Tax Reform repeals the “performance-based compensation” exception for tax years beginning after December 31, 2017 and, as a result, compensation paid to our NEOs (including our CFO) in excess of $1 million in 2018 and beyond will not be deductible unless it qualifies for transition relief applicable to binding written agreements in effect on November 2, 2017 and not materially modified thereafter.
Historically, the Compensation Committee sought to provide our NEOs with incentive and equity compensation that preserved the tax deductibility of compensation paid by the Company, to the extent reasonably practicable and consistent with the Company’s other compensation objectives.  However, due to the uncertain scope of the transition relief under Tax Reform and the lack of guidance from the Internal Revenue Service, we cannot guarantee that compensation originally intended to satisfy the “performance-based compensation” exception will, in fact, satisfy such requirements. Similarly, despite the availability of transition relief under Tax Reform, the Compensation Committee believes that stockholder interests are best served by not restricting the Committee’s discretion and flexibility in structuring its compensation programs. As such, the Compensation Committee has always, and continues to, reserve the right to amend arrangements that were initially intended to qualify as “performance-based compensation” if the Committee determines such amendments are in the best interests of the Company and its stockholders, even though such changes may cause the arrangements to fail to qualify for Tax Reform’s transition relief, resulting in a non-deductible compensation expense for the Company.
Going forward, the Compensation Committee will continue to monitor the impact that Tax Reform will have on the Company’s compensation programs and contracts, including whether and to what extent our existing contracts and programs qualify for the transition relief described above.  


35 MERITAGE HOMES| 2018 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS



Security Ownership Requirements
We maintain security ownership requirements for our directors and certain executive officers.NEOs. The Board of Directors believes that these guidelines align the interests of our directors and executive officers with those of stockholders. Our directors and executive officersare required to comply with ownership guidelines. The guidelinesrequirements for our directors and NEOs are outlined below:
•Directors, threefive times annual directorboard retainer fees (exclusive of committee, committee chair or lead director fees),
•Executive Chairman and CEO, tensix times base salary,salary;
•COO and CFO, three times base salary; and
COO, CFO, CHRO•GC and General Counsel,CPO, two times base salary.
In the case of the appointment of a new executive officer or director, theythe new officer or director shall not be required to purchase stock in the open market in order to become compliant. For directors and executive officers, untilUntil such compliance is achieved they may not sell or otherwise transfer any stock or stock equivalents related to equity awarded by the Company; provided, however, until such compliance is achieved, they may sell stock as necessary to pay any required income tax withholdings in connection with the vesting of any equity grants. Once their income tax withholdings are fulfilled, they may not sell more than 50% of the remaining equity grants or awards that vest in a fiscal year and must hold the balance of their shares until their ownership requirements are met. In order to enable our directors and executive officers to prudently manage their personal financial affairs, our policy provides that once compliance is obtained, subsequent changes in stock price will not affect their compliance with the guidelines provided the officer or director continues to hold at least the number of shares that were necessary to comply with the Stock Ownership Guidelinesstock ownership requirements but for a decrease in stock price.
For purposes of the stock ownership guidelines,requirements, stock is deemed “owned” for both directors and officers in the case of (a) shares owned outright and (b) beneficially-owned shares, and (c) phantom shares allocated to an officer in the Company’s Non-Qualified Deferred Compensation Plan.shares. As of December 31, 2017,2022, all officers and directors were in compliance with their respective security ownership requirements or transitional requirements.

Equity-Based Awards
Meritage has traditionally granted equity-based awards to directors, seniorboard members, executive officers and other key employees to provide a means for incentive compensation and to align the interests of management with the interest of Meritage’s stockholders. Since 2009, all equity awards to employees and directors have been comprised of restricted stock or restricted stock units and for NEOs have been comprised of a combination of restricted stock or restricted stock units and performance share awards as a means of providing sufficient long-term incentive compensation to align with industry trends.market competitiveness.
38 MERITAGE HOMES| 2023 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS


We have comprehensive policies relating to the granting of stock options and other equity-based awards. Following is a summary of key aspects of our policies:
•All equity-based awards must be approved by the Compensation Committee.
All equity-based grants will be approved at formal meetings (including telephonic) of the Compensation Committee.
•The grant date of such awards will be the date of the meeting (or a specified date shortly after the meeting).
•The customary annual equity-based grant shall be approved at a regularly scheduled meeting of the Compensation Committee during the first part of the year, but generally after the annual earnings release. We believe that coordinating the main annual award grant after our annual earnings release will generally result in this grant being made at a time when the public is in possession of all material information about us.
•The Company shall not intentionally grant equity-based awards before the anticipated announcement of materially favorable news, or delay the grant of equity-based awards until after the announcement of materially unfavorable news.
•The Compensation Committee will approve equity-based grants only for persons specifically identified at the meeting by management.
MERITAGE HOMES | 2023 Proxy Statement 39
COMPENSATION DISCUSSION AND ANALYSIS

Employment Agreements in Effect for 20172022
WeThe Compensation Committee annually reviews each NEO’s total compensation relative to the market data while considering the responsibilities of their position, their individual performance and their tenure. In January 2021, we entered into revisednew employment agreements with all of our NEOs, except for Ms. Clinton with whom we entered into an employment agreement in April 2022 when she joined the Company. The employment agreement for Mr. Hilton ends on December 31, 2023. The employment agreements for Mr. Lord, Ms. Sferruzza, and Messrs. White, LordSzubinski and Feliciano in February 2017. The employment agreementsautomatically renew for Messrs. Hilton and White were scheduled to expirea term of one-year on December 31 2017 with automatic one-year extension renewal provisions. These renewal provisions extend the terms of the arrangements for oneeach year, unless on or before August 31 of any renewal term, the executive or the Company notifies the other that it wishes to terminate the agreement. For Ms. Sferruzza and Messrs. Lord and Feliciano, their agreements expire on December 31, 2018 and contain automatic one-year extension renewal provisions unless written notice of non-renewal is providedagreement within sixty days prior to the expiration bydate of any renewal term. The employment agreement for Ms. Clinton initially ends on December 31, 2022 and includes an automatic extension renewal provision that extends the executiveterm of the arrangement for one year unless she or the company.Company notifies the other that it wishes to terminate the agreement within sixty days prior to the expiration date of any renewal term. In December 2021 we increased certain components of compensation for Mr. Lord, Ms. Sferruzza and Messrs. Szubinski and Feliciano. Following is a description of the key provisions between the Company and each of the NEOs of their respective employment agreements in effect for 2017.2022.

MERITAGE HOMES | 2018 Proxy Statement 36
COMPENSATION DISCUSSION AND ANALYSIS


Base Salary
 Named Executive Officer
Phillippe LordHilla SferruzzaSteven J. HiltonClint SzubinskiMalissia ClintonJavier Feliciano
Base Salary$900,000 $725,000 $1,000,000 $650,000 $515,000 $430,000 
  Named Executive Officer
  Steven J. Hilton Hilla Sferruzza C. Timothy White Phillippe Lord Javier Feliciano
           
Base Salary $1,000,000
 $525,000
 $525,000
 $550,000
 $320,000
Non-Equity Incentive Plan
Annual Cash Incentive Bonus
OurIn 2022, our NEOs arewere each entitled to an annual cash incentive bonus based upon the achievement of certain performance goals established by the Compensation Committee. The amount of the target bonus and payout ranges for each NEO is set forth below. The amount of the bonus to be paid is contingent upon the achievement of the performance criteria established by the Compensation Committee. Where the actual performance falls below the threshold level, no incentive bonus will be paid with respect to that performance goal.goal, unless the Compensation Committee approves a discretionary amount.
The non-equity incentive planNon-Equity Incentive Plan has three performance measures, weighted 60%, 30% and 10%, respectively:
1.EBITDA as adjusted for specific and pre-determined items (adjusted EBITDA);
2.Number of home closings; and
3.Customer satisfaction rating as determined by our third-party rating agency.
1.Earnings before interest expense and interest amortized to cost of sales, income taxes, depreciation and amortization (“EBITDA"), adjusted for specific and predetermined items ("adjusted EBITDA");
2.Number of home closings; and
3.Customer satisfaction rating as determined by a third-party rating agency.
We believe these metrics focus our NEOs on the most important short-term measures of our business, establish a clear connection between the Company's strategy, performance and the NEO's earned compensation, and provide greater transparency to our stockholders as to the operation of our non-equity incentive plan.Non-Equity Incentive Plan. Each goal represents a fixed percentage of total potential compensation with each goal assessed separately from the others.
For each of the three performance measures noted above, our Compensation Committee has specified:
•A threshold level of achievement below which no incentives will be paid;
•A target range level of achievement (e.g. between the threshold and maximum) associated with a market-competitive incentive award; and
•A maximum level of achievement above which incentives paid will not increase (payout ceiling)("payout ceiling").
The relationship between the level of performance and associated payout with each level for each of the performance metrics is reflected below.in the following tables. Where actual results fallfell between the performance levels set forth above, payments will bewere calculated based on linear interpolation.
Adjusted EBITDAPerformance as % of TargetPayout as % of Target Payout (1) (2)Number of Home ClosingsPerformance as % of TargetPayout as % of Target Payout (1) (2)Customer Satisfaction RatingPerformance as % of TargetPayout as % of Target Payout (1) (2)
Maximum120.0 %200 %Maximum110.0 %200 %Maximum103.4 %200 %
Target100.0 %100 %Target100.0 %100 %Target100.0 %100 %
Threshold83.1 %50 %Threshold83.0 %50 %Threshold97.8 %50 %
Below Threshold<83.1%0 %Below Threshold<83.0%0 %Below Threshold<97.8%0 %
Adjusted EBITDA Performance as % of Goal Payout as % of Target Payout (1)
Maximum 114.9% (2)
Target 107.7% 100%
Intermediate (Goal)
 100.0% 50%
Threshold 90.0% 25%
Below Threshold <90.0%
 —%
(1) Target payouts for Mr. Lord, Ms. Sferruzza, Messrs. Hilton, Szubinski, and Feliciano, and Ms. Clinton were $2,250,000, $906,250, $1,000,000, $1,300,000, $322,500 and $364,027, respectively, and are based on the achievement of target performance level, as indicated
Number of Home Closings Performance as % of Goal Payout as % of Target Payout (1)
Maximum 112.8% (2)
Target 107.7% 100%
Intermediate (Goal)
 100.0% 50%
Threshold 90.0% 25%
Below Threshold <90.0%
 —%
Customer Satisfaction Rating Performance as % of Goal Payout as % of Target Payout (1)
Maximum 112.5% (2)
Target (Goal)
 100.0% 100%
Intermediate 93.8% 50%
Threshold 87.5% 25%
Below Threshold <87.5%
 —%
40 MERITAGE HOMES| 2023 Proxy Statement
(1)Target payouts for Mr. Hilton, Ms. Sferruzza and Messrs. White, Lord and Feliciano are $2,500,000, $525,000, $600,000, $1,100,000 and $200,000, respectively, and are based on the achievement of target performance level (which is a performance level in excess of the established goal for the Adjusted EBITDA and Number of Home Closings metrics), as indicated in the table above.
(2)Maximum payout percentages for Mr. Hilton, Ms. Sferruzza and Mr. White are 200%; and Messrs. Lord and Feliciano are 170.5% and 133%, respectively.COMPENSATION DISCUSSION AND ANALYSIS



in the preceding tables. Ms. Clinton's target reflects a proration adjustment to her full-year target payout of $515,000 to reflect her length of employment with the Company in 2022.
(2) As outlined in his employment agreement, Mr. Hilton's maximum payout cannot exceed target, which is 100%. The below target thresholds for Mr. Hilton are applicable as indicated in the tables above.

For purposes of determining the executives’ formula bonuses, “Adjusted EBITDA”Adjusted EBITDA means earnings before interest expense and interest amortized to cost of sales, income taxes, depreciation and amortization (“EBITDA”)EBITDA adjusted to exclude non-routine charges that the Compensation Committee determines in its sole discretion at the time the incentive bonus plan is established isas appropriate to exclude.

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COMPENSATION DISCUSSION AND ANALYSIS



Annual Discretionary Bonus
Based on specific achievements of each individual beyond those of the performance measurements included in the annual incentive compensationNon-Equity Incentive Plan calculations, our NEOs may be awarded discretionary cash bonuses subject to approval by the Compensation Committee. No discretionaryThere were no such bonuses were awarded to our NEOs in 2017.2022.
Long-Term (Equity-Based) Incentive Awards
In 2017,2022, our NEOs were entitled to long-term equity incentive awards which consist of two equity delivery vehicles: where fifty-percent (50%) will be50% was provided through a performance-based awardperformance share awards based on three criteria with interpolated potential payout levels and fifty-percent (50%)50% was provided through a performance-based award based on a single performance metric without interpolated potential payout levels.time-based restricted stock units.
Performance Share Awards. In 2017,2022, our NEOs were entitled to performance-basedperformance share awards as part of their overall compensation. As mentioned above, half of theThe performance-based portion of the long-term incentive awards had threehave two metrics, which in 20172022 were weighted 40%, 30%70% and 30%, respectively:
1.Achievement of a targeted earnings per share (“EPS”) goal;
2.Three-year total shareholder return (“TSR”) relative to our TSR peer group (as defined under the caption "—Compensation Philosophies and Objectives — Compensation Peer Group "); and
3.Achievement of a targeted return on asset (“ROA”) goal.
1.Achievement of a targeted return on assets (“ROA”) goal, and
2.Three-year total shareholder return (“TSR”) relative to our TSR peer group (as defined in the section "—Compensation Philosophies and Objectives — Compensation Peer Group ").
The Compensation Committee selected these threetwo measures for ourthe NEO long-term incentive awards as they believe they best align with our current stockholder interests of strong returns, increased profitability per share, and increased efficiency in generating profits from assets. Additionally, the three metrics are assessed from both relative and absolute measurement approaches providing internal and external performance perspective.
For each of the threetwo performance-based plan measures, our Compensation Committee has specified:
•A threshold level of achievement below which no incentivesawards will be paid;
•A target range level of achievement (e.g. between the threshold and maximum) associated with a market-competitive incentive award; and
•A maximum level of achievement above which incentivesawards will not increase (payout ceiling)("payout ceiling").
Each metric is assessed separately from the others,other, and each may be adjusted for specific and pre-determined items established by the Compensation Committee. Both the EPS andThe ROA goals are measured annually and on a standalone basis, although the vesting of the shares will occur at the end of a three-year performance period. The TSR goal remainsis a cumulative three-year metric. The relationship between the level of performance and the shares awarded with each level is reflected in the table below. Where actual results fall between the performance levels set forth below,in the following charts, payments will be calculated based on linear interpolation.
ROAPerformance as % of TargetShares Awarded as % of Target Payout (1)Relative TSRPeer Group PercentileShares Awarded as % of Target Payout (1)
Maximum150.0 %150 %Maximum75.0 %150 %
Target100.0 %100 %Target50.0 %100 %
Threshold50.0 %50 %Threshold25.0 %50 %
Below Threshold<50.0%0 %Below Threshold<25.0%0 %
EPS Performance as % of Goal Shares Awarded as % of Target Payout (1)
Maximum 114.9% 150%
Target 107.7% 125%
Intermediate (Goal) 100.0% 100%
Threshold 90.0% 50%
Below Threshold <90.0%
 —%
ROA Performance as % of Goal Shares Awarded as % of Target Payout (1)
Maximum 112.8% 150%
Target 107.7% 125%
Intermediate (Goal) 100.0% 100%
Threshold 90.0% 50%
Below Threshold <90.0%
 —%
Relative TSR Peer Group Percentile Shares Awarded as % of Target Payout (1)
Maximum 80.0% 150%
Target 65.0% 125%
Intermediate (Goal) 50.0% 100%
Threshold 40.0% 50%
Below Threshold <40.0%
 —%
MERITAGE HOMES | 2023 Proxy Statement 41
(1)The target award payout value is equal to approximately $1,000,000, $393,750, $425,000, $625,000 and $184,000 for Mr. Hilton, Ms. Sferruzza and Messrs. White, Lord and Feliciano, respectively. This 100% payout achievement is based on intermediate performance level as indicated in the table above.

MERITAGE HOMES | 2018 Proxy Statement 38
COMPENSATION DISCUSSION AND ANALYSIS



Single Metric Performance-Based Awards. In addition(1) For 2022, the target award payout value was equal to the performance-based awards described above, the other half of the performance-based awards granted in 2017 wereapproximately $1,800,000, $725,000, $500,000, $650,000, $268,750 and $289,687 for Mr. Lord, Ms. Sferruzza, Messrs. Hilton, Szubinski, and Feliciano, and Ms. Clinton, respectively. This 100% payout achievement is based on target performance level as indicated in the table above. Mr. Hilton is not eligible for payout above 100%. Ms. Clinton’s target payout value reflects a single performance metricproration adjustment to her full-year target payout of $386,250.
Restricted Stock Unit Awards. In 2022, our NEOs were entitled to an annual grant of restricted stock units that cliff vest on the third anniversary of the date of grant. The single metric performance based awards are based on a three-year cumulative customer satisfaction rating, as determined by our third-party rating agency. The number of sharesrestricted stock units to be granted to each executive officer will be equal to the dollar value specified for each executive officer divided by the closing price of the Company’s stock on the grant date. The value of single metric performance-based awardsrestricted stock units granted in 2022 to be granted annually to each officer is approximately $1,000,000, $393,750, $425,000, $625,000 and $184,000 for Mr. Hilton,Lord, Ms. Sferruzza, and Messrs. White, LordHilton, Szubinski, and Feliciano, and Ms. Clinton were $1,800,000, $725,000, $500,000, $650,000, $268,750 and $289,687, respectively. The performance metric must be achieved in full in order for any sharesMs. Clinton’s award value reflects a proration adjustment to be awarded. In the event that actual results fall below the established goal, no shares will be awarded. These single metric performance shares have no stretchher full-year target payouts.payout of $386,250.
Other Benefits
In 2017,2022, our NEOs were also entitled to certain specified other benefits. With respect to Mr. Hilton, heLord was entitled to receive payments annually to purchase life insurance coverage in the policy amount of up to $5,000,000; disability and/or long-term care insurance with monthly benefits of $20,000; reimbursement for business use of his airplane at an amount equalup to comparable charter rates;$20,000; and the use of a Companycompany car. With respect to Ms.Mss. Sferruzza and Clinton and Messrs. White, LordSzubinski and Feliciano they were entitled to receive payments annually forto purchase life insurance in the coverage amount of up to $3,000,000 and disability and/or long-term care insurance with monthly benefits of up to $20,000. Messrs. White and Lord wereMr. Szubinski was also entitled to an auto allowance.
Termination Provisions
In 2017, ourOur NEOs were eligible for paymentsemployment agreements provide them with severance benefits under the Company's Severance Plan in certain situations upon termination of employment, which may include change of control, voluntary resignation by the officer forwith or without good reason, termination by the Company, with and without cause, death or disability, and retirement. A summary of the key termination provisions of each executive officer’s employment agreementthe Executive Severance Plan in effect for 20172022 is outlined beginning on page 49.

39 MERITAGE HOMES| 2018 Proxy Statement
50.
42 MERITAGE HOMES| 2023 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS





Discussion of NEO Compensation
Following is a discussion of the compensation paid, awarded or earned in 20172022 to the Company’s CEO and NEOs.
Our NEOs were compensated in 20172022 pursuant to the terms of their respective employment agreements in effect during 2017,2022, which provided for a base salary, an annual cash incentive bonusa Non-Equity Incentive Plan award based on Company performance, if applicable and earned, equity grants and other customary executive benefits.
Under these agreements, a substantial portion of our NEOs potential compensation was performance-based to align their goals and efforts with the interests of our stockholders.
Salary. In accordance with the terms of their respective employment agreements, each NEO was paid a base salary as outlined below:
in "— Employment Agreements in Effect for 2022."
  Named Executive Officer
  Steven J. Hilton Hilla Sferruzza C. Timothy White Phillippe Lord Javier Feliciano
           
Base Salary $1,000,000
 $525,000
 $525,000
 $550,000
 $320,000
CashNon-Equity Incentive Bonus.Plan. For 2017,2022, our NEOs earned cash performance-based bonuses pursuant to the terms set forth in their respective employment agreements as outlined beginning on page 3639 of this proxy statement and according to the metrics set forth below. These cash bonuses were paid in February 2018.2023.
ACTUAL RESULTS FOR 20172022 ANNUAL INCENTIVE COMPENSATION:
 Named Executive Officer
Actual ResultsPhillippe LordHilla SferruzzaSteven J. Hilton (1)Clint SzubinskiMalissia Clinton
(2)		Javier Feliciano
Adjusted EBITDA (60%)
Actual Results (in thousands)
$1,371,018 $1,371,018 $1,371,018 $1,371,018 $1,371,018 $1,371,018 
Target Performance Level (in thousands)
≥$1,203,592 $1,203,592 $1,203,592 $1,203,592 $1,203,592 $1,203,592 
Target Bonus $$1,350,000 $543,750 $600,000 $780,000 $218,416 $193,500 
NEO Payout % (3)
169.6 %169.6 %100.0 %169.6 %169.6 %169.6 %
NEO Payout $$2,288,956 $921,941 $600,000 $1,322,508 $370,331 $328,083 
Number of Home Closings (30%)
Actual Results14,106 14,106 14,106 14,106 14,106 14,106 
Target Performance Level≥14,081 14,081 14,081 14,081 14,081 14,081 
Target Bonus $$675,000 $271,875 $300,000 $390,000 $109,208 $96,750 
NEO Payout % (3)
101.8 %101.8 %100.0 %101.8 %101.8 %101.8 %
NEO Payout $$686,985 $276,702 $300,000 $396,925 $111,147 $98,468 
Customer Satisfaction Rating (10%)
Actual Results91.5 %91.5 %91.5 %91.5 %91.5 %91.5 %
Target Performance Level≥89.0 %89.0 %89.0 %89.0 %89.0 %89.0 %
Target Bonus $$225,000 $90,625 $100,000 $130,000 $36,403 $32,250 
NEO Payout % (3)
183.3 %183.3 %100.0 %183.3 %183.3 %183.3 %
NEO Payout $$412,500 $166,146 $100,000 $238,333 $66,738 $59,125 
Total NEO Payout $$3,388,441 $1,364,789 $1,000,000 $1,957,766 $548,216 $485,676 
(1) As outlined in his employment agreement, Mr. Hilton’s maximum payout cannot exceed target, which is 100%.
(2) Target bonus for Ms. Clinton reflects a proration adjustment to her full-year target payout to reflect her length of employment with the Company in 2022.
(3) See the table provided on page 39 of this proxy statement for additional information related to the payout percentages as they relate to the targets.
MERITAGE HOMES | 2023 Proxy Statement 43
  Named Executive Officer 
Actual Results Steven J. Hilton Hilla Sferruzza C. Timothy White Phillippe Lord Javier Feliciano 
Adjusted EBITDA (60%)           
Actual Results (in millions) (2)
 $333,178
 $333,178
 $333,178
 $333,178
 $333,178
 
Target Performance Level (in millions) (2)
≥$312,262
 $312,262
 $312,262
 $312,262
 $312,262
 
Target Bonus $ $1,500,000
 $315,000
 $360,000
 $660,000
 $120,000
 
NEO Payout % (1)
 200.0% 200.0% 200.0% 170.5% 133.0% 
NEO Payout $ $3,000,000
 $630,000
 $720,000
 $1,125,300
 $159,600
 
Number of Home Closings (30%)           
Actual Results (2)
 7,709
 7,709
 7,709
 7,709
 7,709
 
Target Performance Level (2)
≥7,723
 7,723
 7,723
 7,723
 7,723
 
Target Bonus $ $750,000
 $157,500
 $180,000
 $330,000
 $60,000
 
NEO Payout % (1)
 98.7% 98.7% 98.7% 98.7% 98.7% 
NEO Payout $ $740,489
 $155,503
 $177,717
 $325,815
 $59,239
 
Customer Satisfaction Rating (10%)           
Actual Results (2)
 90.0
 90.0
 90.0
 90.0
 90.0
 
Target Performance Level (2)
≥80.0
 80.0
 80.0
 80.0
 80.0
 
Target Bonus $ $250,000
 $52,500
 $60,000
 $110,000
 $20,000
 
NEO Payout % (1)
 200.0% 200.0% 200.0% 170.5% 133.0% 
NEO Payout $ $500,000
 $105,000
 $120,000
 $187,550
 $26,600
 
Total NEO Payout $ $4,240,489
 $890,503
 $1,017,717
 $1,638,665
 $245,439
 
(1)See the table provided on page 37 of this proxy statement for additional information related to the payout percentages as they relate to the targets.
(2)    The below table provides the actual results and target performance levels for the three performance measures of annual incentive compensation in 2017 as compared to 2016:
Performance Measure 2017 2016
Adjusted EBITDA (in millions)    
Actual Results $333,178
 $298,069
Target Performance Level≥$312,262
 $290,898
Number of Home Closings    
Actual Results 7,709
 7,355
Target Performance Level≥7,723
 6,995
Customer Satisfaction Rating    
Actual Results 90.0
 88.9
Target Performance Level≥80.0
 80.0

MERITAGE HOMES | 2018 Proxy Statement 40
COMPENSATION DISCUSSION AND ANALYSIS




In 2017, the Company's actual adjusted EBITDA and customer satisfaction ratings exceeded the maximum target set. For these metrics, each NEO qualified for payment at the maximum payment amount. The Company's number of home closings exceeded the target set for this metric and accordingly, each NEO qualified for between the intermediate and target payment amounts based on the linear interpolation of actual results as compared to the target set for that metric.
Equity Awards. In 2017,2022, Mr. Hilton,Lord, Ms. Sferruzza, and Messrs. White, LordHilton, Szubinski, and Feliciano, and Ms. Clinton were granted 18,259, 7,354, 5,072, 6,593, 2,726 and 3,332 performance share awards of 29,326, 11,547, 12,463, 18,328 and 5,396 performance shares (intermediate(target level), respectively, related to the EPS, ROA and TSR performance metrics. Additionally, they were granted an equal amount of time-based shares that cliff vest in 2025. The performance sharesshare awards related to a single metric based on customer satisfaction pursuant to the terms set forth in their respective employment agreements as outlined beginning on page 36. The performance shares related to EPS, ROA and TSR vest on the third anniversary of the date of grant, subject to the achievement of the individual performance measures. The performance shares related to the customer satisfaction metric are subject to a cumulative three-year achievement and vest on the third anniversary of the date of grant, the vesting is contingent upon 100% attainment of the established metric, with no interpolated payout levels if that metric is not met or exceeded. The table below illustrates the potential performance share awards through the performance share plan for 20172022 at threshold, intermediate, target and stretch targetmaximum performance levels for each NEO based on the established performance metrics. For discussion of the restricted stock restricted stock units and performance share awards that vested in 2017,2022, see footnote (3) to the 2017"2022 Stock Awards VestedVested" table on page 48.44.
PERFORMANCE BASED AWARDS GRANTED - EPS, ROA and TSR METRICS:
NameApproximate Award Fair Value
(at Target level) ($)		Below Threshold (Shares) (#)Threshold
(Shares) (#)
Target
(Shares) (#)(1)
Maximum
(Shares) (#)
Phillippe Lord$1,800,000 — 9,130 18,259 27,389 
Hilla Sferruzza$725,000 — 3,677 7,354 11,031 
Steven J. Hilton$500,000 — 2,536 5,072 5,072 
Clint Szubinski$650,000 — 3,297 6,593 9,890 
Malissia Clinton$289,687 — 1,661 3,322 4,983 
Javier Feliciano$268,750 — 1,363 2,726 4,089 
Name and Principal Position 
Approximate Award Fair Value
(at Intermediate level) ($)
Below Threshold (Shares) (#)
Threshold
(Shares) (#)
Intermediate
(Shares) (#)(1)
Target
(Shares) (#)
Stretch Target
(Maximum)
(Shares) (#)
Steven J. Hilton, Chairman and CEO $1,000,000
—
14,663
29,326
36,658
43,989
Hilla Sferruzza, EVP and CFO $393,750
—
5,774
11,547
14,434
17,321
C. Timothy White, EVP, General Counsel and Secretary $425,000
—
6,232
12,463
15,579
18,695
Phillippe Lord, EVP and COO $625,000
—
9,164
18,328
22,910
27,492
Javier Feliciano, EVP and CHRO $184,000
—
2,698
5,396
6,745
8,094
(1)Number of shares based on a grant price of $34.10, the closing stock price on the date of grant for our NEOs.
PERFORMANCE BASED AWARDS - CUSTOMER SATISFACTION METRIC:
(1)Number of shares for Mr. Lord, Ms. Sferruzza, Messrs. Hilton, Szubinski and Feliciano based on a grant price of $98.58, the closing stock price on the date of grant. Number of shares for Ms. Clinton based on grant price of $87.18, the closing stock price on the date of grant.
Name and Principal Position 
Approximate Award Fair Value
($)
Shares (#)(1)
Steven J. Hilton, Chairman and CEO $1,000,000
29,326
Hilla Sferruzza, EVP and CFO $393,750
11,547
C. Timothy White, EVP, General Counsel and Secretary $425,000
12,463
Phillippe Lord, EVP and COO $625,000
18,328
Javier Feliciano, EVP and CHRO $184,000
5,396
(1)Number of shares based on a grant price of $34.10, the closing stock price on the date of grant for our NEOs.
Other Benefits. The Company also provided other benefits consistent with theirour NEOs' employment agreements. These benefits are detailed in footnote (7) to the "All Other"Summary Compensation Table" included in this proxy statement.

41
44 MERITAGE HOMES| 20182023 Proxy Statement
COMPENSATION DISCUSSION AND ANALYSIS






2022 STOCK AWARDS VESTED
The table below sets forth the number and value of shares vested in 2022. All 2,883 shares vested were granted to Mr. Szubinski prior to his appointment as COO. Ms. Clinton joined the Company in April 2022, and therefore had no stock awards vest in 2022. Her first vest is scheduled to occur in August 2025. For discussion of the performance share awards earned in 2022 with a subsequent vest date in 2023, see the supplemental tables within "Outstanding Equity Awards at 2022 Fiscal Year-End" table on page 49.
  Stock Awards
Name
Number of Shares Acquired on Vesting (#) (1)
Value Realized on Vesting ($)
Phillippe Lord56,240 $5,629,624 
Hilla Sferruzza33,166 $3,319,917 
Steven J. Hilton100,944 $10,104,494 
Clint Szubinski2,883 $263,275 
Javier Feliciano12,256 $1,226,826 
(1)Performance share awards vested in March 2022 as a result of the achievement of performance goals are summarized in the table below. Relative ROA performance metrics and achievement were set and calculated annually, whereas the relative TSR performance metrics were set and measured with a cumulative three year performance period. Where actual results fell between the performance levels, shares vested were calculated based on linear interpolation.
Shares Vested
Performance Measurement Year
Name
Relative ROA (1)
TSR (2)
Total
Phillippe Lord20217,725 10,491 18,216 
20207,725 — 7,725 
20196,985 — 6,985 
Total22,435 10,491 32,926 
Hilla Sferruzza20214,555 6,187 10,742 
20204,556 — 4,556 
20194,119 — 4,119 
Total13,230 6,187 19,417 
Steven J. Hilton202113,865 18,831 32,696 
202013,865 — 13,865 
201912,537 — 12,537 
Total40,267 18,831 59,098 
Javier Feliciano20211,683 2,286 3,969 
20201,684 — 1,684 
20191,522 — 1,522 
Total4,889 2,286 7,175 
(1)Actual results achieved for ROA and the target and actual percentile ROA relative to our peer group are shown in the following table.
Actual ROARelative ROA Metrics
YearTarget PercentileActual Percentile
202120.7 %50 %71 %
202013.9 %50 %71 %
20198.5 %50 %64 %

(2)The 2019 TSR awards were based on a cumulative three-year TSR goal. The actual cumulative TSR at the end of the three year period was 86% and the target TSR was 50%.
MERITAGE HOMES | 2023 Proxy Statement 45
COMPENSATION DISCUSSION AND ANALYSIS

20182023 Developments
NEOThe Compensation
In March 2018, Committee annually reviews each NEO’s total compensation relative to market data while considering the Company amended certain aspectsresponsibilities of their position, their individual performance and tenure. Based on this review of competitive market practices in the homebuilding industry and to reward our NEOs for achievement of extraordinary performance, the compensation as allowed by their current employment agreements for Hilla Sferruzza, C. Timothy White, Phillippe Lord and Javier Feliciano providing for the following compensationchanges noted below are effective January 1, 2018:2023.
CASH COMPENSATION:Performance-Based Compensation
The base salary for Ms. Sferruzza and Messrs. White, Lord and Feliciano were increased effective for the 2018 fiscal year. In addition, the target annual cash incentive bonus for Ms. Sferruzza increased to $1,268,750 and Messrs.for Mr. Szubinski increased to $1,625,000. The target value of performance-based equity compensation (non-cash) for Mr. Lord, Ms. Clinton and Mr. Feliciano were increased to $2,025,000, $412,000, and $322,500 respectively, and the payout range fortime-based equity compensation increased to mirror the adjusted target bonus was increasedvalue of performance-based equity compensation.
In addition, for Messrs. Lord, Szubinski, and Feliciano. These revisions are reflectedFeliciano, and Mss. Sferruzza and Clinton, the maximum level of achievement above which the target annual cash incentive bonus will be paid increased to 250% for the 2023 annual cash incentive bonus (to be paid in 2024) and the tables below:maximum level of achievement above which performance-based equity awards will be paid out increased to 200% for shares granted in 2023 (to vest in 2026).
NameRevised Base Salary
Hilla Sferruzza$575,000
C. Timothy White$550,000
Phillippe Lord$650,000
Javier Feliciano$340,000
46 MERITAGE HOMES| 2023 Proxy Statement
NameRevised Target Annual Cash Incentive BonusRevised Payout Range as % of Target Bonus
Hilla Sferruzza$718,750
N/A (1)
Phillippe Lord$1,300,0000% - 200%
Javier Feliciano$212,5000% - 200%
(1)The payout range for Ms. Sferruzza was unchanged from her previous compensation arrangement.

In addition, the performance metrics and payout levels for the Adjusted EBITDA, number of home closings and customer satisfaction were established forthe 2018 annual cash incentive bonus for the CEO and all NEOs as set forth below:
Adjusted EBITDA Performance as % of Goal Payout as % of Target Payout (1)
Maximum 115.0% 200%
Target 100.0% 100%
Threshold 85.0% 50%
Below Threshold <85.0%
 —%
Number of Home Closings Performance as % of Goal Payout as % of Target Payout (1)
Maximum 110.0% 200%
Target 100.0% 100%
Threshold 90.0% 50%
Below Threshold <90.0%
 —%
Customer Satisfaction Rating Performance as % of Goal Payout as % of Target Payout (1)
Maximum 112.5% 200%
Target 100.0% 100%
Threshold 93.8% 50%
Below Threshold <93.8%
 —%
(1)The target value is equal to a payout of approximately $2,500,000, $718,750, $600,000, $1,300,000 and $212,500 for Mr. Hilton, Ms. Sferruzza and Messrs. White, Lord and Feliciano, respectively.

NON-CASH (EQUITY) COMPENSATION:
The target dollar value of equity compensation for Ms. Sferruzza and Messrs. Lord and Feliciano were increased effective for the 2018 fiscal year.
Name Revised Target Dollar Value of Single Metric Performance-Based AwardRevised Target Dollar Value of Three Metric Performance-Based Award (1)Total Revised Target Dollar Value of Equity Awards
Hilla Sferruzza $575,000$575,000$1,150,000
Phillippe Lord $975,000$975,000$1,950,000
Javier Feliciano $212,500$212,500$425,000
(1)The number of shares are payable in an amount ranging from 0% - 150% of the target number of shares awarded, depending on the level of achievement of each of the specified performance goals.

MERITAGE HOMES | 2018 Proxy Statement 42
COMPENSATION DISCUSSION AND ANALYSIS


The performance metrics and payout levels for the EPS, ROA and Relative TSR metrics were established for the 2018 long-term equity incentive awards for the CEO and all NEOs as set forth below. There were no adjustments to the performance metrics and payout levels for the customer satisfaction metric.
EPS Performance as % of Goal Shares Awarded as % of Target Payout (1)
Maximum 115.1% 150.0%
Target 100.0% 100.0%
Threshold 85.1% 50.0%
Below Threshold <85.1%
 —%
ROA Performance as % of Goal Shares Awarded as % of Target Payout (1)
Maximum 115.0% 150.0%
Target 100.0% 100.0%
Threshold 85.0% 50.0%
Below Threshold <85.0%
 —%
Relative TSR Peer Group Percentile Shares Awarded as % of Target Payout (1)
Maximum 80.0% 150.0%
Target 50.0% 100.0%
Threshold 30.0% 50.0%
Below Threshold <30.0%
 —%
(1)The target award value is equal to approximately $1,000,000, $575,000, $425,000, $975,000 and $212,500 for Mr. Hilton, Ms. Sferruzza and Messrs. White, Lord and Feliciano, respectively.
CEO Compensation
In March 2018 the Company entered into an additional long-term equity incentive award opportunity with Steven J. Hilton effective January 1, 2018, which consists of two equity delivery vehicles: where 50% of the long-term equity incentive award opportunity will be provided through a performance-based award based on adjusted home closing gross margin, and 50% through a service-based award conditioned upon continuing employment for Mr. Hilton, subject to acceleration in certain events.
Name Target Value of Performance Share Award (1) Value of Restricted Stock Unit Award Total Value of Additional Long-Term Incentive Award
Steven J. Hilton $750,000 $750,000 $1,500,000
(1)The number of shares are payable in an amount ranging from 0% - 150% of the target number of shares awarded, depending on the level of achievement of the specified performance goal.
Peer Group Composition
In addition, effective January 1, 2018, as a result of it's merger with Lennar Corporation, CalAtlantic Group is no longer a stand-alone company and will no longer be included in the peer group companies used for executive compensation benchmarking and performance benchmarking as well as the peer group for the TSR portion of the performance-based long-term incentive awards. No other changes were made to these peer groups in 2018.


43 MERITAGE HOMES| 2018 Proxy Statement
EXECUTIVE COMPENSATION COMMITTEE REPORT



The following Executive Compensation Committee Report does not constitute soliciting material and should not be deemed filed or incorporated by reference to any Company filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except to the extent the Company specifically incorporates this report.
Executive Compensation Committee Report
The Executive Compensation Committee of the Board of Directors of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and, based on such review and discussions, the Executive Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.
statement and incorporated by reference into our 2022 Annual Report on Form 10-K. 
THE EXECUTIVE COMPENSATION COMMITTEE
Raymond Oppel—Chair
Dana Bradford
Michael R. Odell
Odell—Chair
Dana C. Bradford
Louis E. Caldera
P. Kelly Mooney
Raymond Oppel
 



MERITAGE HOMES | 20182023 Proxy Statement 4447
COMPENSATION OF OFFICERS AND DIRECTORS



Compensation of Officers and Directors
Summary Compensation Table
Name and Principal PositionYearSalary
($)
Bonus
($)
Stock
Awards
($) (5)
Non-Equity
Incentive Plan
Compensation
($) (6)
All
Other
Compensation
($) (7)
Total
($)
Phillippe Lord,2022900,000 — 3,667,484 3,388,441 59,542 8,015,467 
CEO (1)
2021850,000 — 2,956,519 4,048,816 60,268 7,915,603 
2020700,000 — 2,108,124 2,800,000 57,940 5,666,064 
Hilla Sferruzza,2022725,000 — 1,477,117 1,364,789 49,850 3,616,756 
EVP and CFO2021675,000 — 1,341,608 1,607,618 48,402 3,672,628 
2020625,000 — 1,254,814 1,562,500 49,737 3,492,051 
Steven J. Hilton,20221,000,000 — 1,018,757 1,000,000 30,349 3,049,106 
Executive Chairman (2)
20211,000,000 — 993,752 1,000,000 29,581 3,023,333 
20201,000,000 — 3,513,685 5,000,000 43,705 9,557,390 
Clint Szubinski2022650,000 — 1,324,263 1,957,766 69,978 4,002,007 
EVP and COO (3)
2021600,000 — 1,192,503 2,286,390 146,615 4,225,508 
Malissia Clinton, EVP, GC and Secretary (4)
2022364,752 — 589,748 548,216 170,973 1,673,689 
Javier Feliciano,2022430,000 — 547,542 485,676 54,399 1,517,617 
EVP and CPO2021400,000 — 496,792 571,598 53,631 1,522,021 
2020350,000 — 439,119 437,500 49,728 1,276,347 

(1)Effective January 1, 2021, Mr. Lord was appointed Chief Executive Officer. He previously served as Chief Operating Officer. Mr. Lord did not receive any separate compensation for his services as a director in 2022 and 2021.
(2)All compensation is for Mr. Hilton’s services in his capacity as the Executive Chairman in 2021 and 2022, and as the Chief Executive Officer of the Company in 2020. Mr. Hilton did not receive any separate compensation for his services as a director. Effective January 1, 2021, Mr. Hilton retired as Chief Executive Officer and assumed the role of Executive Chairman.
(3)Effective January 1, 2021, Mr. Szubinski was appointed Chief Operating Officer.
(4)Ms. Clinton joined the Company as Executive Vice President and General Counsel effective April 18, 2022.
(5)The non-vested share (performance share awards and restricted stock units) grants have a fair value equal to the closing price of our stock on the date of the grant, in accordance with the requirements of Accounting Standards Codification Subtopic (“ASC”) 718. For the TSR portion of performance award shares, fair value is equal to the valuation from the third-party Monte Carlo analysis prepared in conjunction with the grants. Balance includes all performance share awards and restricted stock unit awards granted in the year to our NEOs and not the prorated share of all unvested grants in prior years that vested in the current year. See Note 11 “Stock Based and Deferred Compensation” of our Consolidated Financial Statements included in our 2022 Annual Report on Form 10-K for discussion of assumptions used for computing the fair value of awards granted. The amounts included in this column represent the grant-date fair value assuming all performance measures are achieved at the target level of performance (i.e., ROA, TSR), which is considered the probable outcome. The grant date fair value at the maximum performance level for the performance share awards in 2022 is $2,801,323, $1,128,248, $518,764, $1,011,539, $418,223 and $450,205 for Mr. Lord, Ms. Sferruzza, Messrs. Hilton, Szubinski, and Feliciano, and Ms. Clinton, respectively.  Additional detail is also provided in the “2022 Grant of Plan-Based Awards” table. For information on the value of shares earned in 2022 based on 2022 performance, see the tables detailing outstanding equity awards at 2022 fiscal year-end on page 49 of this proxy statement.
(6)Non-equity incentive plan compensation earned for all years presented was paid subsequent to each respective year-end.
(7)See the following table for more detail.
48 MERITAGE HOMES| 2023 Proxy Statement
Name and Principal Position Year 
Salary
($)
 
Bonus
($) (2)
 
Stock
Awards
($) (3)
 
Non-Equity
Incentive Plan
Compensation
($) (4)
 
All
Other
Compensation
($) (5)
 
Total
($)
Steven J. Hilton, 2017 1,000,000
 —
 1,934,928
 4,240,489
 48,310
 7,223,727
Chairman and CEO (1)
 2016 1,000,000
 —
 2,034,964
 4,285,957
 36,814
 7,357,735
  2015 1,000,000
 —
 2,026,861
 2,470,185
 34,072
 5,531,118
Hilla Sferruzza, * 2017 525,000
 —
 761,872
 890,503
 40,596
 2,217,971
EVP and CFO 2016 389,562
 74,375
 648,674
 546,459
 43,808
 1,702,878
C. Timothy White, 2017 525,000
 —
 822,308
 1,017,717
 57,172
 2,422,197
EVP, General Counsel 2016 525,000
 —
 864,848
 1,028,630
 55,753
 2,474,231
and Secretary 2015 525,000
 —
 861,371
 592,844
 52,409
 2,031,624
Phillippe Lord, 2017 550,000
 —
 1,209,284
 1,638,665
 55,171
 3,453,120
EVP and COO 2016 550,000
 —
 1,119,239
 1,464,349
 54,894
 3,188,482
  2015 437,500
 100,000
 683,680
 789,604
 46,807
 2,057,591
Javier Feliciano, 2017 320,000
 —
 356,027
 245,439
 31,812
 953,278
EVP and CHRO 2016 320,000
 160,000
 —
 —
 24,364
 504,364
  2015 46,667
(6)75,000
 353,300
 —
 1,219
 476,186

*Ms. Sferruzza was not an NEO in 2015.

(1)All compensation is for Mr. Hilton’s services in his capacity as the Chairman and Chief Executive Officer of the Company. Mr. Hilton did not receive any separate compensation for his services as a director.
(2)Amounts represent discretionary bonuses awarded to the respective executive officers.
(3)The non-vested share (restricted stock and restricted stock unit) grants have a fair value equal to the closing price of our stock on the date of the grant, in accordance with the requirements of Accounting Standards Codification Subtopic (“ASC”) 718. For the TSR portion of performance-based shares, fair value is equal to the valuation from the third-party Monte Carlo analysis prepared in conjunction with the grants. Balance includes all restricted stock and restricted stock units awards granted in the year to our NEOs and not the prorated share of all unvested grants in prior years that vested in the current year. See Note 10 “Stock Based and Deferred Compensation” of our Consolidated Financial Statements included in our 2017 Annual Report on Form 10-K for discussion of assumptions used for computing the fair value of awards granted. In 2017, all awards granted contained performance measures. The amounts included in this column represent the grant-date fair value assuming all performance measures are achieved at the goal level of performance (i.e., total shareholder return, EPS, return on assets, and cumulative customer satisfaction scores). The grant date fair value at the maximum performance level for the performance share awards in 2017 is $2,402,384, $945,932, $1,020,971, $1,501,427 and $442,042 for Mr. Hilton, Ms. Sferruzza and Messrs. White, Lord and Feliciano, respectively.  Additional detail is also provided in the “Grant of Plan-Based Awards” table.
(4)Non-equity plan compensation earned in 2015, 2016 and 2017 was paid subsequent to each respective year-end. For Mr. Lord, included in the 2015 amount is $112,500 in performance related incentive compensation associated with his previous role as Region President. Also for Mr. Lord, excluded from the 2015 and 2016 amounts is $205,126 for deferred incentive compensation from an incentive bonus earned by Mr. Lord in his role as Region President in 2014 that was paid in equal amounts in 2015 and 2016.
(5)See the following table for more detail.
(6)Reflects partial year payments as Mr. Feliciano's employment with the Company commenced in November 2015.

45 MERITAGE HOMES| 2018 Proxy Statement
COMPENSATION OF OFFICERS AND DIRECTORS



All Other Compensation Table
Year Ended December 31, 2017
2022
Name
Health and
Insurance
Premiums
($) (1)
401(k)
Match
($)		Car
Allowance
($)		Other
($)		Total All Other
Compensation
($)
Phillippe Lord51,086 7,500 — 956 59,542 
Hilla Sferruzza40,700 9,150 — — 49,850 
Steven J. Hilton21,199 9,150 — — 30,349 
Clint Szubinski43,885 9,150 14,400 2,543 69,978 
Malissia Clinton (2)
44,042 1,931 — 125,000 170,973 
Javier Feliciano45,249 9,150 — — 54,399 
Name 
Health and
Insurance
Premiums
($) (1)
 
401(k)
Match
($)
 
Car
Allowance
($)
 
Other
($)(2)
 
Total All Other
Compensation
($)
Steven J. Hilton 41,701
 6,480
 —
 129
 48,310
Hilla Sferruzza 33,294
 6,480
 —
 822
 40,596
C. Timothy White 35,332
 6,480
 14,400
 960
 57,172
Phillippe Lord 31,025
 6,480
 14,400
 3,266
 55,171
Javier Feliciano 23,953
 6,480
 —
 1,379
 31,812
(1)Includes: (i) employer portion of benefits provided to all employees and (ii) life and disability insurance premiums as contemplated in each NEO’s employment agreement if such elections were made.
(1)Includes: (i) employer portion of benefits provided to all employees and (ii) life and disability insurance premiums as contemplated in each NEO’s employment agreement if such elections were made.
(2)Other represents the income gross-up to reflect tax consequences of spousal travel for Ms. Sferruzza and Messrs. White, Lord and Feliciano and a gift basket received by Messrs. Hilton, Lord and Feliciano.
2017(2)Amount reported in 'Other' for Ms. Clinton represents a relocation bonus.

2022 Grants of Plan-Based Awards
  Grant Date
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards (1)
Estimated Future Payouts Under
Equity Incentive Plan Awards (2)
All Other Stock Awards: Number of Shares of Stock or Units (#) (2)
Grant Date
Fair Value
of Stock and Option Awards
($) (3)
NameThreshold
($)		Target
($)		Maximum
($)		Threshold
(#)		Target
(#)		Maximum
(#)
Phillippe Lord2/28/202218,259 1,799,972 
2/28/20229,130 18,259 27,389 1,867,512 
N/A1,125,000 2,250,000 4,500,000 
Hilla Sferruzza2/28/20227,354 724,957 
2/28/20223,677 7,354 11,031 752,160 
N/A453,125 906,250 1,812,500 
Steven J. Hilton2/28/20225,072 499,998 
2/28/20222,536 5,072 5,072 518,759 
N/A500,000 1,000,000 1,000,000 
Clint Szubinski2/28/20226,593 649,938 
2/28/20223,297 6,593 9,890 674,325 
N/A650,000 1,300,000 2,600,000 
Malissia Clinton8/10/20223,322 289,612 
8/10/20221,661 3,322 4,983 300,136 
N/A182,014 364,027 728,054 
Javier Feliciano2/28/20222,726 268,729 
2/28/20221,363 2,726 4,089 278,813 
N/A161,250 322,500 645,000 
(1)Actual non-equity incentive plan payouts for 2022 are discussed in the section —"Discussion of NEO Compensation".
(2)Equity awards granted in 2022 have a three-year cliff vest, subject in the case of performance share awards to achievement of established performance metrics.
(3)The grant-date fair value amounts relating to the performance share awards represent the grant-date fair value assuming the performance measures are achieved at the target level of performance, which is considered the probable outcome. Grant date fair value for the TSR portion of awards is based on a Monte-Carlo model to assess fair value as of the date of grant. Grant date fair value for the ROA awards is calculated as of the closing stock price on the date of grant.
MERITAGE HOMES | 2023 Proxy Statement 49
  Grant Date
Estimated Future Payouts Under
Non-Equity Incentive Plan Awards (1)
 
Estimated Future Payouts Under
Equity Incentive Plan Awards (2)
Grant Date
Fair Value
of Stock and
Option Awards
($) (3)
Name
Threshold
($)
Target
($)
Maximum
($)
 
Threshold
(#)
Target
(#)
Maximum
(#)
Steven J Hilton, Chairman and CEO2/14/2017    —
29,326
—
1,000,017
2/14/2017    14,663
29,326
43,989
934,911
 625,000
2,500,000
5,000,000
     
Hilla Sferruzza,
EVP and CFO (2)

2/14/2017    —
11,547
—
393,753
2/14/2017    5,774
11,547
17,321
368,119
 131,250
525,000
1,050,000
     
C. Timothy White, EVP, General Counsel and Secretary2/14/2017    —
12,463
—
424,988
2/14/2017    6,232
12,463
18,695
397,320
 150,000
600,000
1,200,000
     
Phillippe Lord, EVP and COO2/14/2017    —
18,328
—
624,985
2/14/2017    9,164
18,328
27,492
584,299
 275,000
1,100,000
1,875,500
     
Javier Feliciano,
EVP and CHRO
2/14/2017    —
5,396
—
184,004
2/14/2017    2,698
5,396
8,094
172,023
 50,000
200,000
266,000
     
(1)Actual non-equity incentive plan payouts for 2017 are discussed in the section under the caption —"Discussion of NEO Compensation".
(2)Equity awards granted in 2017 have a three-year cliff vest, subject to achievement of established performance metrics.
(3)The grant-date fair value amounts relating to the performance share awards represent the grant-date fair value assuming all three performance measures are achieved at the target level of performance. Grant date fair value for the TSR portion of awards is based on a Monte-Carlo model to assess fair value as of the date of grant. Grant date fair value for the EPS and ROA awards is calculated as of the closing stock price on the date of grant.


MERITAGE HOMES | 2018 Proxy Statement 46
COMPENSATION OF OFFICERS AND DIRECTORS




Outstanding Equity Awards at 20172022 Fiscal Year-End
  Stock Awards
    Equity Incentive Plan Awards
NameNumber
of Shares
or Units
of Stock
That Have
Not
Vested (#)		 
Market
Value of
Shares or
Units of
Stock
That
Have Not
Vested ($) (1)
Number of
Unearned
Shares, Units or
Other Rights
That Have Not
Vested
(#) (9)
Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) (1)
Phillippe Lord90,353 (2) (8)$8,330,547 23,369 $2,154,622 
Hilla Sferruzza44,814 (3) (8)$4,131,851 9,890 $911,858 
Steven J. Hilton74,649 (4) (8)$6,882,638 7,038 $648,904 
Clint Szubinski26,319 (5) (8)$2,426,612 8,835 $814,587 
Malissia Clinton4,485 (6) (8)$413,517 2,547 $234,833 
Javier Feliciano16,164 (7) (8)$1,490,321 3,664 $337,821 
(1)Computed as the number of shares or units of stock that have not yet vested multiplied by the closing price of the Company’s stock on December 31, 2022 of $92.20.
(2)Remaining unvested time-based shares vest: 14,460 in February 2023, 17,568 in March 2024 and 18,259 in February 2025. See also Note (8) below.
(3)Remaining unvested time-based shares vest: 8,607 in February 2023, 7,972 in March 2024 and 7,354 in February 2025. See also Note (8) below.
(4)Remaining unvested time-based shares vest: 24,101 in February 2023, 5,905 in March 2024 and 5,072 in February 2025. See also Note (8) below.
(5)Remaining unvested time-based shares vest: 2,882 in February 2023, 1,801 in February 2024, 7,086 in March 2024 and 7,283 in February 2025. See also Note (8) below.
(6)Remaining unvested time-based shares vest: 3,322 in August 2025. See also Note (8) below.
(7)Remaining unvested time-based shares vest: 3,012 in February 2023, 2,952 in March 2024 and 2,726 in February 2025. See also Note (8) below.
(8)Our long-term equity incentive plan awards vest on the third year after grant, but the component of equity awards that are performance-based have a specific annual ROA goal which is computed for each fiscal year within the three year vesting period. The table below indicates the shares earned for periods where the measurement period is complete for these specific annual ROA goals and thus the number of shares earned has been determined. Shares indicated as vesting in 2023 were earned for the 2020, 2021 and2022 performance periods and represent grants awarded in 2020; shares indicated as vesting in 2024 were earned for the 2021 and 2022 performance periods and represent grants awarded in 2021; shares indicated as vesting in 2025 were earned for the 2022 performance period and represent grants awarded in 2022.
NameVested in February 2023 (#) (a)Vesting in March 2024 (#)Vesting in 2025 (#)Total Earned but not Vested Performance Share Awards as of
December 31, 2022 (#)
Phillippe Lord21,378 12,298 6,390 40,066 
Hilla Sferruzza12,727 5,580 2,574 20,881 
Steven J. Hilton35,632 2,756 1,183 39,571 
Clint Szubinski— 4,960 2,307 7,267 
Malissia Clinton— — 1,163 1,163 
Javier Feliciano4,453 2,067 954 7,474 
(a) As of December 31, 2022, all performance award shares granted in 2020 for the performance periods from 2020 through 2022 were earned and payable based on the achievement of performance metrics for each applicable performance period as set forth below. These shares all vested in February 2023, which was the third anniversary of the date of grant.
50 MERITAGE HOMES| 2023 Proxy Statement
   Stock Awards
      Equity Incentive Plan Awards
Name 
Number
of Shares
or Units
of Stock
that Have
Not
Vested (#)
 
Market
Value of
Shares of
Units of
Stock
that
Have Not
Vested (9)
 
Number of
Unearned
Shares, Units or
Other Rights
that Have Not
Vested
(#) (7) (8)
 
Market or
Payout Value
of Unearned
Shares, Units or
Other Rights
that Have
Not
Vested  (9)
Steven J Hilton, Chairman and CEO 95,395
(1) (6)$4,884,224
 67,318
 $3,446,682
Hilla Sferruzza, EVP and CFO 25,258
(2) (6)$1,293,210
 25,344
 $1,297,613
C. Timothy White,
EVP, General Counsel and Secretary
 40,543
(3) (6)$2,075,802
 28,609
 $1,464,781
Phillippe Lord, EVP and COO 46,698
(4) (6) $2,390,938
 40,910
 $2,094,592
Javier Feliciano, EVP and CHRO 5,026
(5) (6) $257,331
 9,534
 $488,141
(1)Remaining unvested shares vest: 24,839 in February 2018 and 29,078 in March 2019. See also Note (6) below.
(2)Remaining unvested shares vest: 3,120 in February 2018, 2,160 in February 2019, 9,269 in March 2019, and 1,200 in February 2020. See also Note (6) below.
(3)Remaining unvested shares vest: 10,556 in February 2018 and 12,358 in March 2019. See also Note (6) below.
(4)Remaining unvested shares vest: 2,400 in February 2018, 7,196 in March 2018, 1,200 in February 2019 and 15,993 in March 2019. See also Note (6) below.
(5)Remaining unvested shares vest: 3,333 in November 2018. See also Note (6) below.
(6)Includes performance-based shares that satisfied performance criteria as of December 31, 2017 and will vest according to the table below:
Name Vested in February 2018 (#) Vesting in March 2018 (#) Vesting in March 2019 (#) Vesting in February 2020 (#) 
Total Earned but not Vested Performance Shares as of
December 31, 2017 (#)
Steven J Hilton 13,810
 —
 18,464
 9,204
 41,478
Hilla Sferruzza —
 —
 5,885
 3,624
 9,509
C. Timothy White 5,870
 —
 7,847
 3,912
 17,629
Phillippe Lord —
 4,001
 10,155
 5,753
 19,909
Javier Feliciano —
 —
 —
 1,693
 1,693
(7)Represents performance-based shares that vest as follows:
Name Vesting in March 2019 (#) Vesting in February 2020 (#) Total Unearned and Unvested as of December 31, 2017 (#)
Steven J Hilton 15,508
 51,810
 67,318
Hilla Sferruzza 4,943
 20,401
 25,344
C. Timothy White 6,590
 22,019
 28,609
Phillippe Lord 8,531
 32,379
 40,910
Javier Feliciano —
 9,534
 9,534
(8)Excludes performance-based shares scheduled to vest in February 2018 that were forfeited as of December 31, 2017 due to failure to meet performance criteria. Forfeited shares include 11,029 and 4,686 for Messrs. Hilton and White, respectively. Also excludes 3,195 performance-based shares scheduled to vest in March 2018 that were forfeited as of December 31, 2017 due to failure to meet performance criteria for Mr. Lord.
(9)Computed as the number of shares or units of stock that have not yet vested multiplied by the closing price of the Company’s stock on December 29, 2017 of $51.20.

47 MERITAGE HOMES| 2018 Proxy Statement
COMPENSATION OF OFFICERS AND DIRECTORS



MetricPerformance PeriodTargetActualPayout %
Relative TSR2020-2022 cumulative 3 year50.0 %71.4 %142.8 %
ROA202210.0 %20.7 %150.0 %
20219.0 %20.7 %150.0 %
20207.0 %13.9 %150.0 %
2017 Stock Awards Vested(9) Represents unearned performance award shares that vest (at target value) as follows:
NameVesting in March 2024 (#)Vesting in 2025 (#)Total Unearned and Unvested as of December 31, 2022 (#)
Phillippe Lord9,370 13,999 23,369 
Hilla Sferruzza4,252 5,638 9,890 
Steven J. Hilton3,149 3,889 7,038 
Clint Szubinski3,780 5,055 8,835 
Malissia Clinton— 2,547 2,547 
Javier Feliciano1,574 2,090 3,664 
   Stock Awards
Name 
Number of Shares Acquired on Vesting (#) (3)
 Value Realized on Vesting
Steven J Hilton, Chairman and CEO 30,505
 $1,049,372
Hilla Sferruzza, EVP and CFO (1)
 4,320
 $149,028
C. Timothy White, EVP, General Counsel and Secretary 12,965
 $445,996
Phillippe Lord, EVP and COO (2)
 3,900
 $134,685
Javier Feliciano, EVP and CHRO 3,333
 $168,650

(1)Shares vested represent those granted to Ms. Sferruzza prior to her appointment as Chief Financial Officer.
(2)Shares vested represent those granted to Mr. Lord prior to his appointment as Chief Operating Officer.
(3)In connection with the 2014 grant, restricted share units of 21,930 and 9,320 shares vested for Messrs. Hilton and White, respectively, in February 2017. In addition, performance shares vested in February 2017 as a result of the achievement of a targeted three-year cumulative earnings per share performance goal and a targeted three-year cumulative return on asset performance goal for awards granted in 2014, summarized as follows:
  Named Executive Officer
Actual Results (dollars in thousands) Steven J. Hilton C. Timothy White 
      
EPS (30%)     
Actual $11.21
 $11.21
 
Target≥$12.35
 $12.35
 
Shares Vested  (1)
 5,204
 2,212
 
      
ROA (30%)     
Actual 6.30% 6.30% 
Target≥7.39% 7.39% 
Shares Vested (1)
 3,371
 1,433
 
      
Relative TSR (40%)     
Actual 21.43% 21.43% 
Target≥50.00% 50.00% 
Shares Vested (2)
 —
 —
 
      
Total Shares Vested (3)
 8,575
 3,645
 
(1)Where actual results fell between the performance levels, shares vested were calculated based on linear interpolation.
(2)The performance target for relative TSR was not met, therefore no shares were awarded for this metric.
(3)Ms. Sferruzza and Messrs. Lord and Feliciano had no performance-related shares vest in 2017.

MERITAGE HOMES | 2018 Proxy Statement 48
COMPENSATION OF OFFICERS AND DIRECTORS


Nonqualified Deferred Compensation Plans
In 2013, we began toWe offer a non-qualified deferred compensation plan (“deferred compensation plan”) to our NEOs as well as other highly compensated employees in order to allow them additional pre-tax income deferrals above and beyond the limited caps that qualified plans, such as 401(k) plans, impose on highly compensated employees. The deferred compensation plan allows eligible participants to defer up to 75% of their base salary and up to 100% of their qualifying bonus and performance-based compensation.  The deferred compensation plan also allows for discretionary employer contributions, although to date all contributions to the plan have been funded by the employees and we do not currently offer a contribution match. Employee deferrals are deemed 100% vested upon contribution. Distributions from the Plan will be made upon retirement, either in a lump sum or annual installments for up to fifteen years commencing upon normal retirement (upon reaching age 55 and completing ten years of service). Distributions may also be made upon death, separation of service, in-service distribution after 5 years or upon the occurrence of an unforeseeable emergency.


Participants in the deferred compensation plan are entitled to select from a wide variety of investments available under the plan and will be allocated gains or losses based upon the performance of the investments selected by the participant.  All gains or losses are allocated fully to plan participants and the Company does not guarantee a rate of return on deferred balances. In 2015, we amended the deferred compensation plan to allow officers that are subject to our security ownership guidelines to allocate their annual incentive compensation bonuses to a Meritage Homes Corporation phantom stock investment vehicle.  The below table reflects activity for our NEOs that participated in the deferred compensation plan during 2017. 2022.

NameExecutive Contributions in Last FY ($)
Registrant Contributions in Last FY ($) (1)
Aggregate Earnings in Last FY ($) (2)
Aggregate Withdrawals/ Distributions ($)
Aggregate Balance at Last FYE ($) (3)
Hilla Sferruzza766,297 — (356,742)— 1,417,820 
Clint Szubinski60,000 — (88,037)— 176,636 
(1)Meritage does not provide matching contributions.
(2)These amounts do not include any above-market or preferential earnings. Accordingly, these amounts are not reported in the Summary Compensation Table.
(3)All amounts in this column that represent executive contributions from prior years were reported as compensation to the named executive officer in the Summary Compensation Table in prior years, other than Clint Szubinski who was not an NEO prior to 2021.

Name Executive Contributions in Last Fiscal Year ($) 
Registrant Contributions in Last Fiscal Year ($) (1)
 
Aggregate Earnings in Last Fiscal Year ($) (2)
 Aggregate Withdrawals/ Distributions ($) 
Aggregate Balance at Last Fiscal Year End ($) (3)
C. Timothy White, EVP, General Counsel and Secretary —
 —
 150,328
 —
 1,043,570
Phillippe Lord, EVP and COO  (4)
 —
 —
 —
 205,126
 —
(1)Meritage does not provide matching contributions.
(2)These amounts do not include any above-market or preferential earnings. Accordingly, these amounts are not reported in the Summary Compensation Table.
(3)All amounts in this column that represent executive contributions from prior years were reported as compensation to the named executive officer in the Summary Compensation Table in prior years.
(4)Mr. Lord is not a participant in the non-qualified deferred compensation plan.  Amounts reflected in the table for Mr. Lord reflect deferred incentive compensation from an incentive bonus earned by Mr. Lord in his role as Region President in 2014, prior to being promoted to Executive Vice President and Chief Operating Officer. The balance at December 31, 2016 was paid out in full to Mr. Lord in February 2017.
Potential Payments upon Termination or Change of Control Summary
During 2017,2021, we entered into amended employment agreements and change of control agreementsan Executive Severance Plan ("the Severance Plan") with our CEO and NEOs.executives, with the exception of Ms. Clinton with whom we entered into the Severance Plan in April 2022 when she joined the Company. Under their respective terms,the Severance Plan, our CEO and NEOs are entitled to severance payments and other benefits in the event of certain types of terminations. These benefits can
MERITAGE HOMES | 2023 Proxy Statement 51
COMPENSATION OF OFFICERS AND DIRECTORS

include cash payments, continuation of insurance benefits and the acceleration of outstanding stock options, restricted sharesstock units and restricted stock units.performance share awards.
Following is a summary of the severance and change of control provisions that were in effect on December 31, 2017.2022.


Employment Agreements—Severance Benefits
The employment agreements for Messrs. Hilton and White provide the executive with severance benefits in certain situations upon his termination of employment. Following is a summary the potential severance payments and benefits depending on the reason for termination.

49 MERITAGE HOMES| 2018 Proxy Statement
COMPENSATION OF OFFICERS AND DIRECTORS


Voluntary Resignation by Officer Without Good Reason or Termination by the Company With Cause
Voluntary Resignation by Officer With Good Reason (1) (4)
or Termination by the Company Without Cause (1)
Death or Disability
Retirement (1) (2)
In Connection with Change In Control (6)
Base salary and paid time off through date of terminationXXXXXX
Annual cash incentive awards, performance share awards and restricted stock unit awards earned in a previous year but not yet paid or issuedXXXXXX
Pro-rata annual cash incentive bonus for period in which termination occurs based on actual performance achievedXXXX
Target annual cash incentive bonus for the performance period in which the termination occursXX
ProjectedPro-rata target annual cash incentive bonus for the performance period in which the Change of Controltermination occursX
Certain previously granted time-basedService based (time based) awards and restricted stock units that are outstanding shall immediately vest and become unrestrictedXXXXX
Performance shares awarded
100% of performance share awards (or restricted stock units) shall shall continue toimmediately vest and be delivered subject to achievement of specified performance goalsbecome unrestricted (7)
XXXX
Previously granted performance share awards that have not vested will immediately vest and become unrestricted following the end of the applicable performance period based on actual performance achievedXXXX
Target number of previously granted performance share awards that have not vested will immediately vest and become unrestrictedX
Any outstanding stock options shall vest and remain exercisable for the remainder of the original termXXXXX
Payment for health coverage equal to 150% of monthly COBRA premiumXXXX
Severance payment equal to the sum of (A) two times the executive officer’s base salary on the date of termination and (B) two times the higher of (x) the average of the bonus compensation paid to the executive officer for the two years prior to his termination of employment or (y) the annual bonus paid to the executive officer for the year preceding the date of termination (3) (4) (5) (6)
XXX
(1)Mr. Hilton shall render reasonable consulting services during the 24-month period following termination. Mr. White shall render reasonable consulting services during the 12-month period following termination.
(2)In order to qualify for the above retirement termination benefits, in addition to any time restrictions as contemplated in each individual employment agreement, the executive must have completed 15 cumulative years as a named executive officer or member of the board. Messrs. Hilton and White have each satisfied the 15-year threshold.
(3)In the case for Mr. White for termination without cause, the severance payment has a multiple of one in the calculation.
(4)Mr. Hilton's severance payment may not be less than $5 million and may not exceed $10 million. Mr. White's severance payment may not exceed $2 million.
(5)Bonus compensation is determined as the greater of (a) the actual bonus paid to executive or (b) the fair value on the date of grant of the shares of restricted stock, stock options and other equity-based awards that become vested in such year of termination.
(6)In the case for Mr. Hilton for change-in-control, the severance payment has a multiple of three in the calculation. The severance payment for Mr. Hilton in the event of a Change of Control may not exceed $15 million, the severance payment for Mr. White may not exceed $6 million.




MERITAGE HOMES | 2018 Proxy Statement 50
COMPENSATION OF OFFICERS AND DIRECTORS


Ms. Sferruzza and Messrs. Lord and Feliciano's employment agreements provide them with severance benefits in certain situations upon his or her termination of employment. Following is a summary of the potential severance payments and benefits depending on the reason for termination:
Voluntary Resignation by Officer Without Good Reason or Termination by the Company With CauseVoluntary Resignation by Officer With Good ReasonTermination by the Company Without CauseDeath or Disability
Retirement (1)
Change In Control (5)
Base salary and paid time off through date of terminationXXXXXX
Pro-rata annual cash incentive bonus for period in which termination occurs based on actual performance achievedXXX
Pro-rata target annual cash incentive bonus for the performance period in which the termination occurs
Target annual cash incentive bonus for the performance period in which the termination occursXX
Service based (time based) awards and restricted stock units that are outstanding shall immediately vest and become unrestrictedXXX
100% of performance share awards (or restricted stock units) shall immediately vest and become unrestricted (6)
X
Previously granted performance based shares (or performance based restricted stock units) that have not vested will immediately vest and become unrestricted following the end of the applicable performance period based on actual performance achievedXX
Any outstanding and vested stock options will remain exercisable as provided by in the original equity awards (2) (3) (4)
XXXX
Any outstanding and unvested stock options will immediately vest and will remain exercisable for the remainder of12 months following the original equity award, but not later than the tenth anniversary of the original grant datetermination date. (8)
XXX
Payment for health coverage equal to 100% of monthly COBRA premium for 24 monthsXXX
Severance payment equal to twoa multiplier based on the respective role at time of termination times the executive officer’s base salary plus a multiplier based on the daterespective role at time of termination plus two times the executive officers target bonus in the year of termination (4)(5)
XXX
(1)If the executive whose employment is being terminated by the Company without cause satisfies the service requirements for Retirement as described in Note (2) below, the executive may elect to receive Retirement benefits.
(2)In order to qualify for the above retirement termination benefits, in addition to any time restrictions as contemplated in each individual employment agreement, executive must complete 15 cumulative years as an executive officer (as defined by the Severance Plan) or member of the board. As of this date of this proxy filing, only Mr. Hilton has satisfied the service requirements to be eligible for retirement termination benefits.
(3)Upon termination for cause, any outstanding and vested stock options shall be cancelled as of the termination date.
(4)In the event of death or disability, stock options will remain exercisable until the 12 month anniversary of the termination date, provided, however, that the post-termination exercise period for any individual stock option will not extend beyond the earlier of its original maximum term or the tenth anniversary of the original date of grant.
(5)The multiplier in the event of voluntary resignation with good cause or termination without cause is 200% for Mr. Lord, 0% for Mr. Hilton, and 125% for the rest of the NEOs, and the multiplier in a change-in-control event is 300% for Messrs. Lord and Hilton and 200% for the rest of
52 MERITAGE HOMES| 2023 Proxy Statement
(1)In order to qualify for the above retirement termination benefits, in addition to any time restrictions as contemplated in each individual employment agreement, executive must complete 15 cumulative years as a named executive officer or member of the board. Neither Ms. Sferruzza or Messrs. Lord or Feliciano satisfied the 15 year threshold as of December 31, 2017.
(2)Upon termination for cause, any outstanding and vested stock options shall not be exercisable as of the termination date.
(3)In the event of death or disability, stock options will remain exercisable until the 12 month anniversary of the termination date, provided, however, that the post-termination exercise period for any individual stock option will not extend beyond the earlier of its original maximum term or the tenth anniversary of the original date of grant.
(4)Severance payment for each executive officer in a change-in-control is capped at $3,000,000 max payout; severance payment for each executive officer in a non change-in-control is capped at $2,000,000 max payout.
(5)Voluntary resignation with good reason must take place within the time period as defined in the Severance Plan with respect to a change-in- control.
(6)In the event the performance shares are to vest based on achievement of future performance, vesting calculation is to assume target levels had been achieved for the performance criteria.




51 MERITAGE HOMES| 2018 Proxy Statement
COMPENSATION OF OFFICERS AND DIRECTORS



the NEOs. In addition, the severance payment for Ms. Sferruzza and Mr. Feliciano in a non change-in-control event has a minimum payment of $2,000,000 and $1,137,500, respectively.
(6)Voluntary resignation with good reason must take place within the time period as defined in the severance plan with respect to a change-in- control.
(7)In the event the performance share awards are to vest based on achievement of future performance, vesting calculation is to assume target levels had been achieved for the performance criteria.
(8)In the event of retirement, any outstanding and unvested stock options will immediately vest and will remain exercisable for the remainder of the original term, but not later than the tenth anniversary of original date of grant.
Other Matters Regarding the Employment Agreements and Change of Control AgreementsSeverance Plan
The term “Cause” is defined in the employment agreements and the Severance Plan. The terms “Good Reason”, “Cause”"Good Reason" and “Change of Control”"Change in Control" are defined in the employment and change of control agreements.Severance Plan.
All severance payments under the employment agreements and change of control agreementsSeverance Plan are conditioned upon the delivery and non-revocation of a customary release by the executive in favorexecutive.
Each of the Company.
Each executive’s employment agreementagreements and change of control agreement isthe Severance Plan are structured so that the executive is entitled to the greater benefit under the two agreements but is not entitled to duplicative benefits.
Each of the employment agreements and change of control agreementsthe Severance Plan include customary provisions concerning the timing, limitation and alteration of payments to comply with Section 409A of the Internal Revenue Code.
Consistent with the SEC’s rules and regulations concerning executive compensation disclosure, the potential value of each executive’s benefits assumes that the termination occurred on December 31, 2017,2022, and with aaccordingly, the value of the acceleration of stock vestings is computed based on the closing stock price of $51.20$92.20 on the last business day of 2017. The benefit derived from the acceleration of stock vestings was computed based on the closing price of our stock on the last day of 2017 for each equity award affected.2022. Total termination benefits represent payments for severance, non-compete and non-disclosure covenants. ThisThe potential values set forth below do not include the value of the balances under the deferred compensation plan discussed in the section "Nonqualified Deferred Compensation Plans." The summary below reflects the terms of the NEOs’ employment agreements and change of control agreementsthe Severance Plan that were in effect on December 31, 2017.2022, and the actual expense that would be recognized by the Company in the event of a severance event may differ materially from the numbers presented as a result of the required computation in accordance with generally accepted accounting principles for stock compensation expense.
Executive OfficerVoluntary Resignation by Officer Without Good Reason or Termination by the Company With Cause
Voluntary Resignation by Officer With Good Reason or Termination by the Company Without Cause (1)
Death or DisabilityRetirementIn Connection with Change In Control
Phillippe Lord$— $9,722,799 $12,735,168 $13,873,609 $22,219,526 
Hilla Sferruzza$— $3,435,809 $5,949,959 $6,408,497 $9,244,417 
Steven J. Hilton$— $3,034,357 $8,531,541 $8,531,541 $14,565,898 
Clint Szubinski$— $4,429,624 $4,541,199 $5,198,964 $8,475,557 
Malissia Clinton$— $1,480,712 $1,012,377 $1,196,566 $2,491,458 
Javier Feliciano$— $1,460,659 $2,150,642 $2,313,818 $3,690,000 
(1)The amounts presented include cash bonuses earned for fiscal 2022, but not paid as of December 31, 2022. In addition to the table above, the amount of bonuses earned and not paid are presented separately as 2022 compensation in the Summary Compensation Table on page 47.

Executive Officer (1)
Voluntary Termination by Executive Without Good Reason (1)
 
Voluntary Termination by Executive With Good Reason   
 (1)(2)
 
Termination By Company Without Cause (1)(2)
 Termination by Company With Cause 
Death or Disability (1)
 
Retirement (1)
 
Change of Control (1)
Steven J. Hilton$478,054
 $22,610,436
 $22,610,436
 $478,054
 $10,869,947
 $12,571,395
 $23,445,439
Hilla Sferruzza$—
 $2,928,947
 $2,928,947
 $—
 $3,115,822
 $3,481,325
 $5,254,266
C. Timothy White$203,162
 $6,600,355
 $6,153,985
 $203,162
 $4,182,638
 $4,558,299
 $9,537,230
Phillippe Lord$—
 $3,675,109
 $3,675,109
 $—
 $5,585,530
 $6,124,195
 $8,621,974
Javier Feliciano$—
 $1,329,168
 $1,329,168
 $—
 $945,472
 $990,911
 $2,029,201
(1)The actual expense that would be recognized by the Company in the event of a severance event may differ materially from the numbers presented in the table above as a result of the required computation in accordance with generally accepted accounting principles for stock compensation expense.
(2)The amounts presented include cash bonuses earned for fiscal 2017, but not paid as of December 31, 2017. In addition to the table above, the amount of bonuses earned and not paid are presented separately as 2017 compensation in the Summary Compensation table on page 45.

Pay Ratio Disclosure

In August 2015, pursuant to a mandate of the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank"), the Securities and Exchange CommissionSEC adopted a rule requiring annual disclosure of the ratio of the median employee's annual total compensation of the individual identified as the median paid employee (other than the CEO) to the annual total compensation of the chief executive officer ("CEO"). The purpose of the new required disclosure is to provide a measure of the equitability of pay within the organization.CEO. Our pay ratio disclosure is presented below:
Median Employee annual total annual compensation (other than the CEO)$102,098125,371 
Steven J. Hilton (CEO)CEO annual total annual compensation$7,223,7278,015,467 
Ratio of CEO to Median Employee Compensation71:64:1


MERITAGE HOMES | 2023 Proxy Statement 53
COMPENSATION OF OFFICERS AND DIRECTORS

During the fiscal year ended December 31, 2022, we determined that it was no longer appropriate to use the median employee that was determined in 2020 because that employee experienced a change in their position within the Company that had a significant enough impact on their compensation that they were no longer an appropriate reference as median employee. Therefore, we selected a new median employee whose compensation is substantially similar to the prior year's median employee. In determining the prior year's median employee's annual total compensation,employee, a listing was prepared of all employees (excluding the CEO) and their annual cash compensation as of December 31, 20172022 inclusive of base salary and bonus. Wages and salaries and bonuses were annualized for those permanent employees that were not employed for the full year of 2017. 2022. For the fiscal year ended December 31, 2017,2022, we calculated the median employee's total compensation using the same methodology that we used to calculate the total compensation for our CEO in the Summary Compensation tableTable on page 4547 of this Proxy Statement.



MERITAGE HOMES | 2018 Proxy Statement 52
COMPENSATION OF OFFICERS AND DIRECTORS


Director Compensation
When establishing and reviewing our director's compensation, we consider the level of work and involvement the directors have with our business. We also consider compensation paid to directors in the marketplace generally and at our peer group companies and consider advice from our independent compensation consultant.
We believe that non-employee director compensation paid primarily in the form of equity awards highly aligns the board members with the interests of the stockholders of the Company. In 2017,2022, approximately 75% of the compensation paid to non-employee directors in the aggregate was in the form of equity awards. Cash compensation paid to directors as a percentage of total compensation has been relatively flat for more than five years.
In 2022, our non-employee directors received an annual retainer of $50,000, committee chairs received an additional annual payment of $20,000, and other committee members received an additional payment of $10,000 per committee, with the exception of Land Committee, as there is currently no compensation paid for service on this transaction-based committee, which meets at irregular intervals. The lead director received an additional $40,000 annually. following cash compensation:
Board Retainer$50,000 
Committee Chair Retainer (All Committees Except the Land Committee)$20,000 
Committee Member Retainer (All Committees Except the Land Committee)$10,000 
Lead Director Retainer$40,000 

In addition, during 2017,2022, each of our directors (other than Ms. Henretta who received a one-time catch up grant in 2017 ) received a grant of 5,0002,500 shares of restricted stock whichunits. These shares cliff vest on February 14, 2020. Mr. Hilton does not receieve any compensationthe third anniversary of the grant date, except for his role asMessrs. Keough, Caldera and Ms. Mooney whose vest on the first anniversary of the grant date. Board members appointed after 2019 receive annual equity award grants with a director.one-year vesting period.
The 20172022 non-employee director compensation is set forth below:below. Messrs. Hilton and Lord compensation are represented in the Summary Compensation Table. They received no additional compensation for their duties as a member of the Board.
Name
Fees Earned or Paid in Cash ($) (1)
Stock Awards ($) (2)
Total ($)
Raymond Oppel70,000 233,975 303,975 
Peter L. Ax120,000 233,975 353,975 
Gerald Haddock70,000 233,975 303,975 
Dana C. Bradford70,000 233,975 303,975 
Michael R. Odell70,000 233,975 303,975 
Deborah Ann Henretta70,000 233,975 303,975 
Joseph Keough70,000 233,975 303,975 
P. Kelly Mooney70,000 233,975 303,975 
Louis E. Caldera (3)
57,500 233,975 291,475 
(1)Committee and chair fees are paid to directors on a quarterly basis.
(2)See Note 11 “Stock Based and Deferred Compensation” of our Consolidated Financial Statements included in our 2022 Annual Report on Form 10-K for discussion of the assumptions used for computing the fair value of awards granted. As required, the calculation is equal to the fair value of the award on the date of grant multiplied by the total number of awards granted in 2022, not the proportionate share of all existing unvested awards that vested in the current year.
(3)Mr. Caldera was appointed to the Compensation Committee in the second quarter of 2022.
We reimburse directors for out-of-pocket expenses incurred in attending Board and committee meetings and we also reimburse certain directors for charter aircraft service or other travel and lodging-related expenses. During 2022, we made reimbursements of approximately $4,000, $5,100, $6,300, $3,800, $5,100 and $8,200 to Mss. Henretta and Mooney, and Messrs. Oppel, Odell, Keough and Caldera, respectively.
At December 31, 2022, Messrs. Oppel, Ax, Haddock, Bradford, and Odell, and Ms. Henretta each had 8,250 outstanding unvested equity awards, and Messrs. Keough and Caldera and Ms. Mooney each had 2,500 outstanding unvested equity awards.
54 MERITAGE HOMES| 2023 Proxy Statement
Name 
Fees Earned or Paid in Cash ($) (1)
 
Stock Awards ($) (2)
 Total ($)
Robert G. Sarver 50,000
 170,500
 220,500
Raymond Oppel 70,000
 170,500
 240,500
Peter L. Ax 120,000
 170,500
 290,500
Richard T. Burke, Sr. 60,000
 170,500
 230,500
Gerald Haddock 70,000
 170,500
 240,500
Dana Bradford 70,000
 170,500
 240,500
Michael R. Odell 60,000
 170,500
 230,500
Deb Henretta (3)
 60,000
 511,500
 571,500
(1)
Committee and chair fees are paid to directors on a quarterly basis.COMPENSATION OF OFFICERS AND DIRECTORS


Pay versus Performance
In August 2022, pursuant to a mandate of Dodd-Frank commonly referred to as "Pay versus Performance", the SEC adopted a rule ("the SEC rule") requiring registrants to provide a clear description of (1) the relationship between executive compensation actually paid ("CAP") to the Company's NEOs (including the principal executive officer or person acting in a similar capacity during the last completed fiscal year ("PEO")) and the cumulative TSR of the Company, and (2) the relationship between the Company's TSR and the TSR of a peer group chosen by the Company. The following table provides information regarding Compensation Actually Paid to our PEO and non-PEO NEOs during each of the past three fiscal years, as well as total shareholder return, net income, and ROA. Our Compensation Committee did not rely on this analysis in its decision making process. See section “—Compensation Discussion and Analysis" for a comprehensive discussion of our executive compensation program and philosophy.
Value of Initial Fixed $100 Investment Based On:
YearSummary Compensation Table Total for PEO
(1)		CAP to PEO
 (1) (3) (4)		Average Summary Compensation Table Total for Non-PEO NEOs (2)Average CAP to Non-PEO NEOs
(2) (4)		Cumulative Total Shareholder Return
(5)		Cumulative Peer Group Shareholder Return
(5)		Net Income
(in thousands)
(6)		Company Selected Measure
(ROA)
(6)
2022$8,015,467 $5,124,002 $2,771,835 $1,463,392 $75.54 $77.24 $992,192 20.7 %
2021$7,915,603 $13,521,596 $3,765,401 $6,630,450 $111.33 $116.52 $737,444 20.7 %
2020$9,557,390 $15,676,557 $3,283,577 $5,296,314 $150.88 $142.70 $423,475 13.9 %
(1) For the years 2022 and 2021, our PEO is Phillippe Lord and for 2020, our PEO was Steven J. Hilton, as they served as the Company's CEO during those respective years.
(2) Non-PEO NEOs include: Hilla Sferruzza, Steven J. Hilton, Clint Szubinski, Malissia Clinton and Javier Feliciano in 2022; Hilla Sferruzza, Steven J. Hilton, Clint Szubinski, C. Timothy White (our Former Executive Vice President, General Counsel and Secretary) and Javier Feliciano in 2021; and Phillippe Lord, Hilla Sferruzza, C. Timothy White and Javier Feliciano in 2020.
(3) Adjustments to the Summary Compensation Table Total to arrive at CAP for PEO are shown below. No adjustments were necessary for defined benefit and pension plans, dividends or forfeitures.
YearSummary Compensation Table Total for PEOLess:
Grant Date Fair Value of Equity Awards Granted in Fiscal Year		Plus:
Increase/(Decrease) in Fair Value of Equity Vested during Fiscal Year		Plus:
Increase/(Decrease) in Fair Value of Unvested Equity at Fiscal Year-End
(Current Year Awards)		Plus:
Increase/(Decrease) in Fair Value of Unvested Equity at Fiscal Year-End
(Prior Year Awards)		CAP to PEO
2022$8,015,467 $(3,667,484)$(1,235,030)$3,642,886 $(1,631,837)$5,124,002 
2021$7,915,603 $(2,956,519)$97,238 $4,562,638 $3,902,636 $13,521,596 
2020$9,557,390 $(3,513,685)$751,280 $4,350,566 $4,531,006 $15,676,557 
(4) Adjustments to the Summary Compensation Table Total to arrive at CAP for Non-PEO NEOs are shown below. No adjustments were necessary for defined benefit and pension plans, dividends or forfeitures.
YearAverage Summary Compensation Table Total for Non-PEO NEOsLess:
Average Grant Date Fair Value of Equity Awards Granted in Fiscal Year		Plus:
Average Increase/(Decrease) in Fair Value of Equity Vested during Fiscal Year		Plus:
Average Increase/(Decrease) in Fair Value of Unvested Equity at Fiscal Year-End
(Current Year Awards)		Plus:
Average Increase/(Decrease) in Fair Value of Unvested Equity at Fiscal Year-End
(Prior Year Awards)		Average CAP to Non-PEO NEOs
2022$2,771,835 $(991,485)$(660,564)$989,330 $(645,724)$1,463,392 
2021$3,765,401 $(976,923)$276,939 $1,366,073 $2,198,960 $6,630,450 
2020$3,283,577 $(1,167,705)$309,118 $1,445,912 $1,425,412 $5,296,314 
MERITAGE HOMES| 2023 Proxy Statement 55
(2)
See Note 10 “Stock Based and Deferred Compensation” of our Consolidated Financial Statements included in our 2017 Annual Report on Form 10-K for discussion of the assumptions used for computing the fair value of awards granted. As required, the calculation is equal to the fair value of the award multiplied by the total number of awards granted in 2017, not the proportionate share of all existing unvested awards that vested in the current year.PAY VERSUS PERFORMANCE
(5) We have elected to use the Dow Jones US Home Construction Index as our peer group. The graphs below illustrate the relationship between our cumulative TSR and peer group TSR, and the relationship between our CAP and the cumulative TSR for both the Company and our peer group.
mth-20230323_g24.jpgmth-20230323_g25.jpg
(6) The relationships between CAP and Net Income and CAP and ROA are illustrated in the following graphs. ROA is calculated as Net Income divided by the average of five trailing quarters Total Assets, less Cash and Cash Equivalents. Both Net Income and Total Assets are adjusted for material actions or events that affect comparability to target. Our ROA as it relates to CAP is demonstrated below.
mth-20230323_g26.jpgmth-20230323_g27.jpg
Our most important metrics impacting CAP for the year ending December 31, 2022 are:
(3)Metric
Ms. Henretta was appointed to the BoardRelative TSR
ROA
Adjusted EBITDA
Number of Directors on March 7, 2016 and accordingly received a catch-up stock award valued at $511,500 in 2017, which has a three-year ratable vesting period.Home Closings
Customer Satisfaction Rating
MERITAGE HOMES| 2023 Proxy Statement 56
(4)
We reimburse directors for out-of-pocket expenses incurred in attending Board and committee meetings and we also reimburse certain directors for charter aircraft service or other travel and lodging-related expenses. During 2017, we made reimbursements of approximately $38,000, $7,000, $6,000, $6,000, $2,000 and $1,000 to Messrs. Sarver, Oppel, Ms. Henretta, Messrs. Haddock, Bradford and Odell, respectively. The reimbursement to Mr. Sarver included charter aircraft services for various Board members and NEOs to one meeting.
(5)The following represents the total number of unvested shares of restricted stock at December 31, 2017 for each non-employee director: 14,000 for Messrs. Sarver, Oppel, Ax, Burke, Haddock, Bradford and Odell and 15,000 for Ms. Henretta.

53 MERITAGE HOMES| 2018 Proxy Statement
SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS



Securities Authorized for Issuance Under Equity Compensation Plans
The following table summarizes our equity compensation under all of our equity compensation plans as of December 31, 2017:2022:
Plan Category
(a)
Number of Securities to
be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights (1)
(b)
Weighted Average
Exercise Price of
Outstanding
Options, Warrants
and Rights (2)
(c)
  Number of Securities Remaining Available for Future Issuance
under Equity Compensation
Plans (Excluding Securities
Reflected in Column (a) (1))
Equity compensation plans approved by stockholders803,769 N/A731,405 
Equity compensation plans not approved by stockholders— N/A— 
Total803,769 N/A731,405 
(1)Balance includes 659,102 time-based restricted stock awards and units, and 144,667 performance share awards (at target level). Assuming maximum performance level is achieved for the performance share awards, an additional 66,837 shares are subject to outstanding awards (total number of securities to be issued upon exercise of outstanding awards of 870,606, which results in 664,568 shares remaining available for future issuance).
(2)The outstanding equity awards are time-based restricted stock awards and units and performance share awards which do not have an exercise price.




MERITAGE HOMES| 2023 Proxy Statement 57
Plan Category 
(a)
Number of Shares to
be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights (1)
 
(b)
Weighted Average
Exercise Price of
Outstanding
Options, Warrants
and Rights (2)
 
(c)
  Number of Securities Remaining  
Available for Future Issuance
under Equity Compensation
Plans (Excluding Securities
Reflected in Column (a)) (3)
Equity compensation plans approved by stockholders 1,269,657
 N/A 1,169,574
Equity compensation plans not approved by stockholders —
 N/A —
Total 1,269,657
 N/A 1,169,574
(1)Balance includes 982,652 time-based restricted stock awards and units, and 287,005 performance share awards (at target level).
(2)The outstanding equity awards are time based restricted stock awards and units and performance share awards which don't have an exercise price.
(3)The number of securities remaining available for issuance is comprised of shares under our 2006 Plan. In addition to stock options, stock appreciation rights and performance share awards, the 2006 Plan allows for the grant of restricted stock shares and restricted stock units. Under the 2006 Plan, awards other than stock options and stock appreciation rights are counted against the shares available for grant as 1.38 shares for every one share issued in connection with such awards.




MERITAGE HOMES | 2018 Proxy Statement 54
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE



Delinquent Section 16(a) Beneficial Ownership Reporting ComplianceReports
Executive officers, directors and “beneficial owners” of more than ten percent of our common stock must file initial reports of ownership and changes in ownership with the SEC under Section 16(a) of the Exchange Act. SEC regulations require these reporting persons to furnish us with copies of all Forms 3, 4 and 5, and amendments thereto, that they file with the SEC. Based solely on our review of the copies of such forms furnished to us, or representations that no forms were required, we believe that during 20172022 all of our officers, directors and greater than ten percent beneficial owners complied with all filing requirements of Section 16(a) of the Exchange Act.
 


55 MERITAGE HOMES| 2018 Proxy Statement

MERITAGE HOMES| 2023 Proxy Statement 58
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS



Certain Relationships and Related Transactions
Meritage maintains a written policy concerning conflict of interest transactions that generally applies, among other things, to transactions between the Company and related persons, including employees, officers and directors and applies to direct and indirect relationships and transactions. Because of the nature of our business, which involves the ownership, development, construction and sale of real estate and single family homes, our policy was carefully constructed to capture transactions and relationships between the Company or its competitors, and related persons and relationships between employees, directors, suppliers, vendors, subcontractors (“trades”) and others. At the same time, we wereare mindful to not inadvertently create the potential for conflicts relating to transactions that are primarily of a personal nature and do not involve the Company, or conflict with its business (for example, the construction of a vacation home or the purchase of a home from the Company pursuant to our home purchase policy that is available to most employees).
For transactions not exempted from the policy, Meritage’s policy requires that designated members of senior management must review and approve any transaction between a covered person (e.g.(i.e., employees, officers and directors) and the Company, or between a covered person and a trade contractor. The policy provides that the Company’s legal and internal audit departments are to be involved in the review and approval process. For transactions involving directors or senior executive officers (including the officers named in this proxy statement), the proposed transaction must be approved in advance by the Audit Committee of the Board of Directors.Board. Real estate transactions between the Company and related persons are subject to strict scrutiny.
Each of theThe transactions listed below was were approved by the Audit Committee of the Board of Directors pursuant to the policy.
We currently charter aircraft services from companies in which Mr. Hilton does not have an ownership interest, although these companiesthat use Mr. Hilton's private plane. PaymentsPayments made to these companies are at arms-length transaction prices and were as follows (in thousands):
  Year Ended December 31,
  202220212020
Air Charter Services$383 $535 $408 

 
MERITAGE HOMES| 2023 Proxy Statement 59
   Year Ended December 31,
   2017 2016 2015
Air Charter Services $580
 $711
 $695


MERITAGE HOMES | 2018 Proxy Statement 56
INDEPENDENT AUDITORS



Independent Auditors
Deloitte & Touche LLP serveshas served as our principal independent registered public accounting firm.firm since 2004. We expect representatives of Deloitte & Touche LLP to be present at our Annual Meeting of Stockholders to respond to appropriate questions, and they will be given an opportunity to make a statement if they desire to do so.
The following table presents fees for professional accounting services rendered by our principal accountant for the audit of our annual financial statements for 20172022 and 2016,2021, and fees billed for other services rendered.
20222021
Audit fees$1,225,000 $1,172,500 
Audit-related fees— — 
Audit and audit-related fees$1,225,000 $1,172,500 
Tax fees— — 
All other fees— — 
Total fees$1,225,000 $1,172,500 
  2017 2016
Audit fees (1)
 $1,080,000
 $1,151,500
Audit-related fees —
 —
Audit and audit-related fees $1,080,000
 $1,151,500
Tax fees —
 —
All other fees —
 —
Total fees $1,080,000
 $1,151,500
(1)
Audit fees consisted principally of fees for audit and review services, and approximately $30,000 and $26,500 in 2017 and 2016, respectively, for services related to various SEC comfort letters provided in connection with securities offerings and expert consents provided in connection with SEC filings and other transactions.


Each year, the Audit Committee approves the annual audit engagement in advance. The Audit Committee also has established procedures to pre-approve all non-audit services provided by the principal independent registered public accounting firm. All 2017 and 2016 non-audit services listed above were pre-approved.
 

MERITAGE HOMES| 2023 Proxy Statement 60
INDEPENDENT AUDITORS

The following report of the Audit Committee does not constitute soliciting material and should not be deemed filed or incorporated by reference into any Company filing under the Securities Act or the Exchange Act, except to the extent the Company specifically incorporates this report.

57 MERITAGE HOMES| 2018 Proxy Statement
REPORT OF THE AUDIT COMMITTEE



Report of the Audit Committee
We have reviewed Meritage’s audited consolidated financial statements and met with both management and Deloitte & Touche LLP, the Company’s independent registered public accounting firm, to discuss those consolidated financial statements. Management has represented to us that the consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States of America. We have also reviewed, and discussed with management and Deloitte & Touche LLP, management’s report and Deloitte & Touche LLP’s report and attestation on internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act. We have received from, and discussed with, Deloitte & Touche LLP the written disclosure and the letter required by the applicable requirements of the Public Company Accounting Oversight Board regarding independence. These items related to that firm’s independence from Meritage. We also discussed with Deloitte & Touche LLP those matters required to be discussed by Statement on Auditing Standards No. 114, as amended, “The Auditor’s Communication with those charged withWith Those Charged With Governance” and Rule 2-07 of Regulation S-X “Communications“Communication with Audit Committees.” Based on these reviews and discussions, we recommended to the Board of Directors that Meritage’s audited financial statements be included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2017.2022.
THE AUDIT COMMITTEE
Peter L. Ax—Chair
Richard T. Burke Sr.

Dana C. Bradford


Joseph Keough

MERITAGE HOMES | 2018 Proxy Statement 58

MERITAGE HOMES| 2023 Proxy Statement 61
STOCKHOLDER PROPOSALS



Stockholder Proposals, Director Nominations and Other Items of Business
If any stockholder would like to make a proposal at our 20182024 annual meeting pursuant to Rule 14a-8 of the Exchange Act, we must receive it no later than December 3, 20185, 2023 in order that it may be considered for inclusion in the proxy statement and form of proxy relating to that meeting.
As discussed underin the headingsection “Corporate Governance and Board Matters-The Board and Board Committees-Director Nomination Process-Proxy Access,” our bylaws permit an eligible shareholder,stockholder, or a group of up to 20 shareholders,stockholders, that has continuously owned at least three percent of the Company’s outstanding shares of common stock for three years to include in the Company’s proxy materials director nominations of up to 20% (rounded to the nearest whole number) of the number of directors constituting the class up for election at any annual meeting.  Notice of proxy access director nominees must be submitted timely and include the information required under our bylaws. To be timely, a proxy access nomination must be delivered to or mailed and received by the Secretary at the principal executive offices of the Company, not earlier than the 150th day nor later than the 120th day prior to the first anniversary date of mailing of this proxy statement, which is expected to occur on or about April 2, 2018;3, 2023; provided, however, that in the event that the date of the 20192024 Annual Meeting is advanced or delayed by more than 30 days from the first anniversary of the date of this year’s annual meeting, which is to be held on May 17, 2018,18, 2023, notice by the stockholder must be delivered not earlier than the 150th day prior to the date of such annual meeting and not later than the later of the 120th day prior to the date of such annual meeting or the tenth day following the date on which public announcement of the date of such meeting is first made.
Proposals to be presented at the 20182024 Annual Meeting that are not intended for inclusion in our proxy statement, including director nominations not made pursuant to the proxy access provisions in the Company's bylaws, must be submitted in accordance with our bylaws. To be timely, a stockholder’s notice of such a proposal must be delivered to or mailed and received by the Secretary at the principal executive offices of the Company, not earlier than the 150th day nor later than the 120th day prior to the first anniversary date of mailing of this proxy statement, which is expected to occur on or about April 2, 2018, (or, with respect to a proposal required to be included in Meritage’s proxy statement pursuant to Rule 14a-8 of the Securities Exchange Act of 1934, or its successor provision, the earlier date such proposal was received); provided,3, 2023. Provided, however, that in the event that the date of the 20192024 Annual Meeting is advanced or delayed by more than 30 days from the first anniversary of the date of this year’s annual meeting, which is to be held on May 17, 2018,18, 2023, notice by the stockholder must be delivered not earlier than the 150th day prior to the date of such annual meeting and not later than the later of the 120th day prior to the date of such annual meeting or the tenth day following the date on which public announcement of the date of such meeting is first made. In addition to the requirements in our bylaws, to comply with the universal proxy rules, stockholders who intend to solicit proxies in support of director nominees other than Company nominees must provide notice to the Company that sets forth the information required by Rule 14a-19 under the Exchange Act no later than March 18, 2024.
A nomination or other proposal will be disregarded if it does not comply with the above procedures.
Stockholder proposals and director nominations and other items of business should be submitted to:


Meritage Homes Corporation
8800 East Raintree Drive Suite 300
Scottsdale, Arizona 85260
Attn: Secretary
 

59 MERITAGE HOMES| 20182023 Proxy Statement 62
FORWARD-LOOKING STATEMENTS



Forward-Looking Statements
This proxy statement contains “forward-looking statements” as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and involve substantial risks and uncertainties, which may cause results to differ materially from those set forth in the statements. The forward-looking statements may include, but are not limited to, statements made concerning our strategies, plans and anticipated benefits from our DE&I and ES&S initiatives; statements made in the CD&A section of this proxy statement regarding the benefits of our strategy and trends in the homebuilding industry; future compensation actions or events; the deductibility of executive compensation under Section 162(m) of the Internal Revenue Code; our strategy and opportunities and the anticipated effects of our compensation structure and programs. Meritage undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. Forward-looking statements should be evaluated together with the many uncertainties that affect Meritage’s business, particularly those mentioned under the heading “Risk Factors” in Meritage’s Annual Report on Form 10-K, and in the periodic reports that Meritage files with the SEC on Form 10-Q.
 

MERITAGE HOMES| 20182023 Proxy Statement 60 63
ANNUAL REPORT ON FORM 10-K AND OTHER MATTERS



Annual Report on Form 10-K and Other Matters
The Board of Directors is not aware of any other matters to be presented at the meeting. If any other business should properly come before the meeting, the proxy holders will vote according to their best judgment.
A copy of the Company’s Annual Report on Form 10-K for the year ended December 31, 20172022 may be viewed and downloaded from investors.meritagehomes.com, may be requested via email through such website or may be requested telephonically at 480-515-8100. The Annual Report is not considered to be proxy solicitation material.
Upon request, the Company will provide by first class mail, to each stockholder of record on the record date, without charge, a copy of this proxy statement and the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017,2022, including the required financial statements and financial statement schedules. Written requests for this information should be directed to: Corporate Secretary, Meritage Homes Corporation, 8800 East Raintree Drive, Suite 300, Scottsdale, AZ 85260.
 
 



61
MERITAGE HOMES| 20182023 Proxy Statement 64


MERITAGE HOMES CORPORATION
Annual Meeting of Stockholders May 17, 201818, 2023
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
The shareholder(s)stockholder(s) signing below hereby appoint(s) Phillippe Lord, Steven J. Hilton and C. Timothy White,Malissia Clinton, and each of them, as proxies, each with the power to appoint his or her substitute, and hereby authorizes them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of Commoncommon stock of MERITAGE HOMES CORPORATION that the stockholder(s) is/are entitled to vote at the Annual Meeting of shareholdersStockholders to be held virtually at 8:30 AM local timePDT on May 17, 2018, at Meritage’s corporate office at 8800 E. Raintree Drive, Suite 300, Scottsdale, Arizona 85260,18, 2023, and any adjournment or postponement thereof. In order to attend the meeting, you must register at https://viewproxy.com/meritage/2023/ by 11:59 PM EDT on May 15, 2023. On the day of the Annual Meeting of Stockholders, if you have properly registered, you may enter the meeting by clicking on the link provided and the password you received via email in your registration confirmations. Further directions on how to attend and vote at the Annual Meeting of Stockholders are contained in the Proxy Statement in the section titled “Proxy Summary - General Information.”
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN. IF NO SUCH DIRECTION IS MADE, THIS PROXY WILL BE VOTED “FOR” EACH OF THE DIRECTOR NOMINEES NAMED IN THIS PROXY STATEMENT, “FOR” EACH OF THE PROPOSALS 2, 3 AND 5 AND "1 YEAR" FOR PROPOSAL 4 AND AT THE DISCRETION OF THE PROXY HOLDERS ON ANY OTHER MATTER(S) THAT PROPERLY COME BEFORE THE MEETING, OR ANY POSTPONEMENT OR ADJOURNMENT THEREOF.
CONTINUED AND TO BE SIGNED ON REVERSE
 

5 PLEASE DETACH ALONG PERFORATED LINE AND MAIL IN THE ENVELOPE PROVIDED.  5
Important Notice Regarding the Availability of Proxy Materials for the Annualvirtual Shareholder Meeting
of Stockholders to be held May 17, 2018.18, 2023. The Proxy Statement and our 20172022 Annual
Report to Stockholders are available at: at www.allianceproxy.com/meritagehomes/2018

2023




1. Election of five Class I directors, each to hold office until our 2020 annual meeting.2. Ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the 2018 fiscal year.
FORAGAINSTABSTAIN
FOR ¨ AGAINST¨ ABSTAIN¨
01Raymond Oppel¨¨¨3. Advisory vote to approve compensation of our Named Executive Officers ("Say on Pay").
02Steven J. Hilton
¨

¨

¨

FOR ¨ AGAINST¨ ABSTAIN¨
03Richard T. Burke Sr.
¨

¨

¨

04Dana C. Bradford
¨

¨

¨

4. Approval of our 2018 Stock Incentive Plan.
05Deb Henretta
¨

¨

¨

FOR ¨ AGAINST¨ ABSTAIN¨
1. Election of five Class II directors2. Ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for the 2023 fiscal year.
FORAGAINSTABSTAIN
¨ FOR ¨ AGAINST ¨ ABSTAIN
01Peter L. Ax¨¨¨3. Advisory vote to approve compensation of our Named Executive Officers ("Say on Pay").
02Gerald Haddock¨
¨
¨
¨ FOR ¨ AGAINST ¨ ABSTAIN
03Joseph Keough¨
¨
¨
4. Advisory Vote on the Frequency of Future Advisory Votes on Say on Pay.
04Phillippe Lord¨¨¨
¨ 1 YEAR ¨ 2 YEARS ¨ 3 YEARS ¨ ABSTAIN
05Michael R. Odell¨¨¨4. Amendment to our 2018 Stock Incentive Plan to increase the number of shares available for issuance.
¨ FOR ¨ AGAINST ¨ ABSTAIN
NOTE: The conduct of any other business that may properly come before the meeting or any adjournment or postponement thereof.
I plan to attend the meeting
¨

Please sign your name exactly as it appears hereon. When signing as attorney, executor, administrator, trustee, guardian, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer.
Date:Date:
Signature
Signature (if held jointly)
VIRTUAL CONTROL NUMBER
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5 PLEASE DETACH ALONG PERFORATED LINE AND MAIL IN THE ENVELOPE PROVIDED.  5




VIRTUAL CONTROL NUMBER
mth-20230323_g28.jpg
PROXY VOTING INSTRUCTIONS
Please have your 11 digit control numberVirtual Control Number ready when voting by Internet or Telephone or when voting during the virtual Annual Meeting

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mth-20230323_g30.jpg
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INTERNETTELEPHONEMAIL
Vote Your Proxy on the Internet:Vote Your Proxy by Phone:Vote Your Proxy by Mail:
 
Go to www.AALvote.com/MTH
 
 
Call 1 (866) 804-9616
 
Have your proxy card availableUse any touch-tone telephone toMark, sign, and date your proxy
when you access the abovevote your proxy. Have your proxycard, then detach it, and return it
website. Follow the prompts tocard available when you call.in the postage-paid envelope
vote your shares.Follow the voting instructions toprovided.
vote your shares.




APPENDIX A



Amendment

to the
MERITAGE HOMES CORPORATION
Amended AND restated
2018 STOCK INCENTIVE PLAN

EFFECTIVE DATE: May 17, 2018
Approved by Stockholders: May 17, 2018
TERMINATION DATE: May 17, 2028

SECTION 1
ESTABLISHMENT, PURPOSE, EFFECTIVE DATE, EXPIRATION DATE

1.1ESTABLISHMENT. Meritage Homes Corporation (the “Company”“Company”) hereby establishespreviously established the Meritage Homes Corporation 2018 Stock Incentive Plan (the “Plan”“Plan”). Except as provided in Section 5.1,By the establishmentadoption of this Amendment, the Company wishes to amend the Plan is not intended to have any effect onincrease the Meritage Homes Corporation Amended and Restated 2006 Stock Incentive Plan (the “2006 Plan”) or any Prior Plan and awards may after the Effective Date continue to be grantedauthorized number of shares available for grant under the 2006 Plan and the Prior Plans, in accordance with their terms. The 2006 Plan and all Prior Plansby 800,000.

1.This Amendment shall remain in effect until all awards granted under such Prior Plans have been vested, exercised, forfeited, cancelled, expired or otherwise terminated in accordance with their terms.
1.2PURPOSE. The purposebe effective as of the Plan is to enhance and promote the success of the Company by linking the personal interests of the members of the Board, employees, officers, executives, consultants and advisors to those of the Company stockholders and by providing such individuals with an incentive for outstanding performance to generate superior returns to the Company stockholders. The Plan is further intended to provide flexibility to the Company in its ability to motivate, attract, and retain the services of Board members, employees, officers, executives, consultants and advisors upon whose judgment, interest, and special effort the successful conduct of the Company’s operation is largely dependent. To further these objectives, the Plan provides for the grant of Options, Stock Appreciation Rights, Restricted Stock Awards, Performance Share Awards and Restricted Stock Unit Awards.
1.3EFFECTIVE DATE. The Plan will become effective on the date it is approved by the Company’s stockholders at the Company’s 2018its 2023 Annual Meeting (the “Effective Date”).Meeting.
1.4EXPIRATION DATE. The Plan will expire on, and no Award may be granted under the Plan after, the tenth (10th) anniversary2.Section 5.1 (Number of the Effective Date (the “Expiration Date”). Any Awards that are outstanding on the Expiration Date shall remain in force according to the termsShares) of the Plan is hereby amended and the applicable Award Agreement.

SECTION 2
GLOSSARY; CONSTRUCTION

2.1GLOSSARY. When a word or phrase appears in this Plan document with the initial letter capitalized, and the word or phrase does not commence a sentence, the word or phrase will generally be given the meaning ascribed to it in Section 1 or in the attached Glossary, which is incorporated into and is part of the Plan. All of these key terms are listed in the Glossary. Whenever these key terms are used, they will be given the defined meaning unless a clearly different meaning is required by the context.
2.2CONSTRUCTION. The masculine gender, where appearing in the Plan, shall include the feminine gender (and vice versa), and the singular shall include the plural, unless the context clearly indicates to the contrary. If any provision of this Plan is determined to be for any reason invalid or unenforceable, the remaining provisions shall continue in full force and effect.

SECTION 3
ELIGIBILITY AND PARTICIPATION

3.1.GENERAL ELIGIBILITY.Persons eligible to participate in this Plan include all employees, officers, and Non-Employee Directors of, and Consultants to, the Company or any Subsidiary. Awards may also be granted to prospective employees or Non-Employee Directors but no portion of any such Award will vest, become exercisable, be issued, or become effective prior to the date on which such individual begins to provide services to the Company or its Subsidiaries.
3.2.ACTUAL PARTICIPATION.Subject to the provisions of the Plan, the Committee may, from time to time, select from among all eligible individuals, those to whom Awards will be granted and will determine the nature and amount of each Award.
3.3.FOREIGN PARTICIPANTS. In order to assure the viability of Awards granted to Participants employed in foreign countries, the Committee may provide for such special terms as it may consider necessary or appropriate to accommodate differences in local law, tax policy, or custom. Moreover, the Committee may approve such supplements to, or amendments, restatements, or alternative versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in effect for any other purpose; provided, however, that no such supplements, amendments, restatements, or alternative versions shall increase the share limitations contained set forth in Section 5.

SECTION 4
ADMINISTRATION

4.1.GENERAL. The Plan shall be administered by the Executive Compensation Committee or, with respect to individuals who are Non-Employee Directors, the Board. All references in the Plan to the “Committee” shall refer to the Committee or Board, as applicable. A majority of the Committee shall constitute a quorum. The acts of a majority of the members present at any meeting at which a quorum is present, and acts approved in writing by a majority of the Committee in lieu of a meeting, shall be deemed the acts of the Committee. Each member of the Committee is entitled to, in good faith, rely or act upon any report or other information furnished to that member by any officer or other employee of the Company or any Subsidiary, the Company’s independent registered public accountants, or any executive compensation consultant or other

professional retained by the Company to assist in the administration of the Plan. The Committee is authorized to interpret the Plan, to prescribe, amend, and rescind rules and regulations as it may deem necessary or advisable to administer the Plan, to provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company, and to make all other determinations necessary or advisable for the administration of the Plan, but only to the extent not contrary to the express provisions of the Plan.
4.2.COMMITTEE RESPONSIBILITIES. Subject to the provisions of the Plan, the Committee shall have the authority to:(a) designate the Participants who are entitled to receive Awards under the Plan; (b) determine the types of Awards and the times when Awards will be granted; (c) determine the number of Awards to be granted and the number of shares of Stock to which an Award will relate; (d) determine the terms and conditions of any Award granted pursuant to the Plan, including, but not limited to, the exercise price or base value, grant price, or purchase price, any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations or waivers thereof, based in each case on such considerations as the Committeerestated in its sole discretion determines; provided, however, that the Committee shall not take any action or failentirety to take any action with respect to the operation of the Plan that would cause all or part of the payment under any Award to be subject to the additional tax under Section 409A of the Code; (e) determine whether, to what extent, and in what circumstances an Award may be settled in, or the exercise price or purchase price of an Award may be paid in cash, Stock, or other Awards, or other property, or whether an Award may be cancelled, forfeited, exchanged or surrendered; (f) prescribe the form of each Award Agreement, which need not be the same for each Participant; (g) decide all other matters that must be determined in connection with an Award; (h) interpret the terms of, and determine any matter arising pursuant to, the Plan or any Award Agreement; and (i) make all other decisions or determinations that may be required pursuant to the Plan or an Award Agreementread as the Committee deems necessary or advisable to administer the Plan, including, without limitation, establishing, adopting, or revising any rules and regulations as it may deem necessary or advisable to administer the Plan. The Committee shall also have the authority to modify existing Awards to the extent that such modification is within the power and authority of the Committee as set forth in the Plan. The foregoing list of powers is not intended to be complete or exclusive and, to the extent not contrary to the express provisions of the Plan, the Committee shall have such powers, whether or not expressly set forth in this Plan, that it may determine necessary or appropriate to administer the Plan.follows:
4.3.DECISIONS FINAL. The Committee’s interpretation of the Plan, any Awards granted pursuant to the Plan, any Award Agreement and all decisions and determinations by the Committee with respect to the Plan are final, binding, and conclusive on all parties. No member of the Committee shall be liable for any action or determination made in good faith with respect to the Plan or any Award granted under the Plan.
SECTION 5
SHARES AVAILABLE FOR GRANT

5.1.5.1 NUMBER OF SHARES. Subject to adjustment as provided in Section 10, the aggregate number of shares of Stock reserved and available for grant pursuant to the Plan shall be 1,250,000,2,050,000, plus the number of shares of Stock that were authorized but unissued under the 2006 Plan and all Prior Plans as of May 13, 2019. The shares of Stock delivered pursuant to any Award may consist, in whole or in part, of authorized but unissued Stock, treasury Stock not reserved for any other purposes, or Stock purchased on the open market.
5.2.SHARE COUNTING.The following rules shall apply solely for purposes of determining the number of shares of Stock available for grant under the Plan at any given time:

a.The number of shares of Stock reserved and available for grant pursuant to the Plan shall be reduced by one share of Stock for each one share issued in connection with Awards granted under the Plan (or by which the Award is valued by reference).
b.In the event any Award granted under the Plan after the Effective Date, or any award outstanding under any Prior Plan after May 13, 2019, is terminated, expired, forfeited, or cancelled for any reason (including, for the avoidance of doubt, any shares that were previously granted under any Prior Plan that terminate, expire, are forfeited or are cancelled after May 17, 2006 for any reason), the number of shares of Stock subject to such Award or Prior Plan award will again be available for grant under the Plan (i.e., any prior charge against the limit set forth in Section 5.1 shall be reversed).
c.If shares of Stock are not delivered in connection with an Award because the Award may3.This Amendment amends only be settled in cash rather than in Stock, no shares of Stock shall be counted against the limit set forth in Section 5.1. If any Award may be settled in cash or Stock, the rules set forth in Section 5.2(b) shall apply until the Award is settled, at which time, if the Award is settled in cash, the underlying shares of Stock will be added back to the shares available for grant pursuant to Section 5.1.
d.The exercise of a stock-settled SAR or broker-assisted “cashless” exercise of an Option (or a portion thereof) will reduce the number of shares available for grant under Section 5.1 by the entire number of shares of Stock subject to that SAR or Option (or applicable portion thereof), even though a smaller number of shares of Stock will be issued upon such an exercise.
e.Shares of Stock tendered to pay the exercise price of an Option or tendered, withheld or otherwise relinquished by a Participant to satisfy a tax withholding obligation arising in connection with any Award will not again become Stock available for grant under the Plan. Moreover, shares of Stock purchased on the open market with cash proceeds generated by the exercise of an Option or SAR will not increase or replenish the number of shares available for grant under Section 5.1.
f.If the provisions of the Plan as noted above, and those provisions not expressly amended shall be considered in full force and effect. Notwithstanding the foregoing, this Section 5.2Amendment shall supersede the provisions of the Plan to the extent those provisions are inconsistent with the requirements of any regulations issued pursuant to Section 422 of the Code, the provisions of such regulations shall control over the provisionsand intent of this Section 5.2, but only as this Section 5.2 relates to Incentive Stock Options.Amendment.
g.To the maximum extent permitted by applicable law and the NYSE listing standards (or the rules of any exchange on which the Stock is then listed), shares of Stock awarded in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form of combination by the Company or any Subsidiary shall not be counted against shares of Stock available for grant under Section 5.1. 

h.The Committee may adopt such other reasonable rules and procedures as it deems to be appropriate for determining the number of shares of Stock that are available for grant under Section 5.1.
5.3.AWARD LIMITS. Notwithstanding any other provision in the Plan, and subject to adjustment as provided in Section 10:
a.The maximum number of shares of Stock that may be awarded as Incentive Stock Options under the Plan shall be 1,250,000.
b.The maximum number of shares of Stock that may be granted to any one Participant during any twelve (12) month period with respect to one or more Awards shall be 200,000.
c.The sum of the total cash compensation earned and paid and the aggregate grant date fair value (calculated as of the Date of Grant in accordance with applicable accounting rules) of shares subject to Awards granted to any one Participant who is a Non-Employee Director during any one twelve (12) month period shall not exceed $750,000. For the avoidance of doubt, if a Non-Employee Director serves the Company in more than one capacity during any twelve (12) month period, the total compensation limit described in

this Section 5.3(c) shall only apply to the compensation paid for services performed as a Non-Employee Director. To the extent any Non-Employee Director compensation is deferred, it shall be counted toward this total compensation limit for the year in which the compensation was first earned or granted.
d.Notwithstanding the twelve (12) month minimum vesting period described in Section 12.7, the Committee shall have the authority to grant Awards that do not comply with the twelve (12) month minimum vesting requirement, provided, that, such Awards do not exceed five percent (5%) of the numeric limit set forth in Section 5.1.
5.4.FRACTIONAL SHARES. No fractional shares of Stock shall be issued pursuant to the Plan and, the Committee in the Award Agreement shall determine whether cash shall be given in lieu of fractional shares or whether such fractional shares shall be eliminated by rounding up or down as appropriate. In the event of adjustment as provided in Section 10, the total number of shares of Stock subject to any affected Award shall always be a whole number by rounding any fractional share to the nearest whole share.

SECTION6
STOCK OPTIONS

6.1.OPTIONS. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Options to one or more Participants upon such terms and conditions and in such amounts, as shall be determined by the Committee; provided, however and except as otherwise provided in Section 12.7 of the Plan, the minimum vesting period for Options shall be twelve (12) months. Options are also subject to the following additional terms and conditions:
a.Exercise Price. No Option shall be granted at an exercise price that is less than the Fair Market Value of one share of Stock on the Date of Grant.
b.Exercise of Option. Options shall be exercisable at such times and in such manner, and shall be subject to such restrictions or conditions, as the Committee shall in each instance approve, which need not be the same for each grant or for each Participant. Unless otherwise provided in an Award Agreement, Options shall immediately lapse if a Participant’s employment is terminated for Cause. In addition, unless otherwise provided in an Award Agreement, if a Participant incurs a termination of employment on account of Disability or death before the Option lapses, the Option shall lapse, unless it is previously exercised, on the earlier of: (i) the scheduled termination date of the Option; or (ii) twelve (12) months after the date of the Participant’s termination of employment on account of death or Disability. Upon the Participant’s death or Disability, any Options exercisable at the Participant’s death or Disability may be exercised by the Participant’s legal representative or representatives, by the person or persons entitled to do so pursuant to the Participant’s last will and testament, or, if the Participant fails to make testamentary disposition of such Option or dies intestate, by the person or persons entitled to receive the Option pursuant to the applicable laws of descent and distribution.
c.Term of Option. Each Option shall expire at such time as determined by the Committee; provided, however, that no Option shall be exercisable later than the tenth (10th) anniversary the Date of Grant.
d.Payment. The exercise price for any Option shall be paid in cash or shares of Stock held for longer than six (6) months (through actual tender or by attestation). In the Award Agreement, the Committee also may prescribe other methods by which the exercise price of an Option may be paid and the form of payment including, without limitation, any net-issuance arrangement or other property acceptable to the Committee (including broker-assisted “cashless exercise” arrangements), and the methods by which

shares of Stock shall be delivered or deemed to be delivered to Participants. The Committee, in consideration of applicable accounting standards and applicable law, may waive the six (6) month share holding period described in the first sentence of this paragraph (d) in the event payment of an Option is made through the tendering of shares.
e.Repricing of Options. Notwithstanding any other provision in the Plan to the contrary, without approval of the Company’s stockholders, an Option may not be amended, modified or repriced to reduce the exercise price after the Date of Grant. Except as otherwise provided in Section 10 with respect to an adjustment in capitalization, an Option also may not be surrendered in consideration of or exchanged for cash, other Awards or a new Option having an exercise price below the exercise price of the Option being surrendered or exchanged.
6.2.INCENTIVE STOCK OPTIONS. Incentive Stock Options shall be granted only to Participants who are employees and the terms of any Incentive Stock Options granted pursuant to the Plan must comply with the following additional provisions of this Section 6.2:
a.Exercise Price. Subject to Section 6.2(d), the exercise price per share of Stock pursuant to any Incentive Stock Option shall be set by the Committee, provided that the exercise price for any Incentive Stock Option shall not be less than the Fair Market Value of one share of Stock as of the Date of Grant.
b.Lapse of Option. An Incentive Stock Option shall lapse in the following circumstances:
i.The Incentive Stock Option shall lapse ten (10) years from the Date of Grant, unless an earlier time is set in the Award Agreement;
ii.The Incentive Stock Option shall lapse upon a termination of employment for any reason other than the Participant’s death or Disability, unless otherwise provided in the Award Agreement; and
iii.If the Participant incurs a termination of employment on account of Disability or death before the Option lapses pursuant to paragraph (i) or (ii) above, the Incentive Stock Option shall lapse, unless it is previously exercised, on the earlier of: (1) the scheduled termination date of the Option; or (2) twelve (12) months after the date of the Participant’s termination of employment on account of death or Disability. Upon the Participant’s death or Disability, any Incentive Stock Options exercisable at the Participant’s death or Disability may be exercised by the Participant’s legal representative or representatives, by the person or persons entitled to do so pursuant to the Participant’s last will and testament, or, if the Participant fails to make testamentary disposition of such Incentive Stock Option or dies intestate, by the person or persons entitled to receive the Incentive Stock Option pursuant to the applicable laws of descent and distribution.
c.Individual Dollar Limitation. The aggregate fair market value (determined as of the time an Award is made and calculated in accordance with Section 422 of the Code) of all shares of Stock with respect to which Incentive Stock Options are first exercisable by a Participant in any calendar year may not exceed $100,000 or such other limitation as imposed by Section 422(d) of the Code, or any successor provision. To the extent that Incentive Stock Options are first exercisable by a Participant in excess of such limitation, the excess shall be considered Non-Qualified Stock Options.
d.Ten Percent Owners. An Incentive Stock Option may be granted to any individual who, at the Date of Grant, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of Stock of the Company only if such Option is granted at a price that is not less than 110% of Fair Market Value on the Date of Grant and the Option is exercisable for no more than five (5) years from the Date of Grant.

e.Right to Exercise. Except as provided in Section 6.2(c)(iii), an Incentive Stock Option may be exercised only by the Participant during the Participant’s lifetime.
f.Limitation on Number of Shares Subject to Awards. Subject to adjustment as provided in Section 10, the maximum number of shares of Stock that may be issued as Incentive Stock Options under the Plan shall be 1,250,000.

SECTION 7
STOCK APPRECIATION RIGHTS

7.1.STOCK APPRECIATION RIGHTS. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant SARs to one or more Participants upon such terms and conditions and in such amounts, as shall be determined by the Committee; provided, however and except as otherwise provided in Section 12.7 of the Plan, the minimum vesting period for SARs shall be twelve (12) months. SARs are also subject to the following additional terms and conditions:
a.Base Value. No SAR shall be granted at a base value that is less than the Fair Market Value of one share of Stock on the Date of Grant.
b.Exercise of SARs. SARs shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall, in each instance approve, which need not be the same for all Participants.
c.Term of SARs. Each SAR shall expire at such time as determined by the Committee; provided, however, that no SAR shall be exercisable later than the tenth (10th) anniversary the Date of Grant.
d.Payment of SAR Amount. Upon the exercise of a SAR, the Participant shall be entitled to receive the payment of an amount determined by multiplying: (i) the excess, if any, of the Fair Market Value of a share of Stock on the date of exercise, over the base value fixed by the Committee on the Date of Grant; by (ii) the number of shares with respect to which the SAR is exercised. Payment for SARs shall be made in the manner and at the time specified by the Committee in the Award Agreement. At the discretion of the Committee, the Award Agreement may provide for payment of SARs in cash, shares of Stock of equivalent value, or in a combination thereof.
e.Repricing of SARs. Notwithstanding any other provision in the Plan to the contrary, without approval of the Company’s stockholders, a SAR may not be amended, modified or repriced to reduce the base value after the Date of Grant. Except as otherwise provided in Section 10 with respect to an adjustment in capitalization, a SAR also may not be surrendered in consideration of or exchanged for cash, other Awards or a new SAR having a base value below the base value of the SAR being surrendered or exchanged.

SECTION 8
RESTRICTED STOCK AWARDS AND RESTRICTED STOCK UNIT AWARDS

8.1.RESTRICTED STOCK AWARDS. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Restricted Stock Awards to one or more Participants upon such terms and conditions, and in such amounts, as shall be determined by the Committee. Restricted Stock Awards are also subject to the following additional terms and conditions:

a.Issuance and Restrictions. Restricted Stock Awards shall be subject to such conditions and/or restrictions as the Committee may impose (including, without limitation, limitations on transferability, the right to receive dividends, or the right to vote the Stock), which need not be the same for each grant or for each Participant; provided, however and except as otherwise provided in Section 12.7 of the Plan, the minimum vesting period for Restricted Stock Awards shall be: (i) twelve (12) months in the case of non-tenure Restricted Stock Awards (i.e., Restricted Stock Awards subject to performance vesting criteria); and (ii) pro rata over three (3) years in the case of tenure Restricted Stock Awards.  These restrictions may lapse separately or in combination at such times, pursuant to such circumstances, in such installments, or otherwise, as determined by the Committee. Except as otherwise provided in the Award Agreement, Participants holding shares of Restricted Stock Awards may not exercise voting rights with respect to the shares of Restricted Stock during the period of restriction.
b.Forfeiture. Except as otherwise provided in the Award Agreement or other written document such as an employment agreement or a change of control agreement, upon a termination of employment (or termination of service in the case of a Consultant or Non-Employee Director) during the applicable period of restriction, Restricted Stock Awards that are at that time subject to restrictions shall be forfeited.
c.Evidence of Ownership for Restricted Stock Awards. Restricted Stock Awards granted pursuant to the Plan may be evidenced in such manner as the Committee shall determine, which may include an appropriate book entry credit on the books of the Company or a duly authorized transfer agent of the Company. If certificates representing shares of Stock are registered in the name of the Participant, the certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Stock Award, and the Company may, in its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse.
8.2.RESTRICTED STOCK UNIT AWARDS. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Restricted Stock Units to one or more Participants upon such terms and conditions, and in such amounts, as shall be determined by the Committee. Restricted Stock Unit Awards are also subject to the following additional terms and conditions:
a.Issuance and Restrictions. Restricted Stock Unit Awards grant a Participant the right to receive a specified number of shares of Stock, or a cash payment equal to the fair market value (determined as of a specified date) of a specified number of shares of Stock, subject to such conditions and/or restrictions as the Committee may impose, which need not be the same for each grant or for each Participant; provided, however and except as otherwise provided in Section 12.7 of the Plan, the minimum vesting period for Restricted Stock Unit Awards shall be: (i) twelve (12) months in the case of non-tenure Restricted Stock Unit Awards (i.e., Restricted Stock Unit Awards subject to performance vesting criteria); and (ii) pro rata over three (3) years in the case of tenure Restricted Stock Unit Awards. These restrictions may lapse separately or in combination at such times, in such circumstances, in such installments, or otherwise, as determined by the Committee.
b.Forfeiture. Except as otherwise provided in the Award Agreement or other written document such as an employment agreement or a change of control agreement, upon a termination of employment (or termination of service in the case of a Consultant or Non-Employee Director) during the applicable period of restriction, Restricted Stock Unit Awards that are at that time subject to restrictions shall be forfeited.
c.Form and Timing of Payment.Payment for vested Restricted Stock Units shall be made in the manner and at the time designated by the Committee in the Award Agreement. In the Award Agreement, the Committee may provide that payment will be made in cash or Stock, or in a combination thereof. As a general rule, the shares issued under any Restricted Stock Unit Award (or cash delivered pursuant

to such Award) will be paid to the Participant in a single lump sum within 60 days following the date on which the Restricted Stock Units vests. Unless the related Award Agreement is structured to qualify for an exception to the requirements of Section 409A of the Code, such payment is intended to be made at a specified time or pursuant to a fixed schedule under Treasury Regulation Section 1.409A-3(a)(4). Subject to the six (6) month delay described in Section 16.11(b), the Restricted Stock Units that vest upon a Participant’s Separation from Service will be issued to the Participant within 60 days following the date of the Participant’s Separation from Service.
SECTION 9
PERFORMANCE SHARE AWARDS

9.1.PERFORMANCE SHARE AWARDS.Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Performance Share Awards to one or more Participants upon such terms and conditions, restrictions and in such amounts, as shall be determined by the Committee; provided, however and except as otherwise provided in Section 12.7 of the Plan, the minimum vesting period for Performance Share Awards shall be: (i) twelve (12) months in the case of non-tenure Performance Share Awards (i.e., Performance Share Awards subject to performance vesting criteria); and (ii) pro rata over three (3) years in the case of tenure Performance Share Awards. These restrictions may lapse separately or in combination at such times, in such circumstances, in such installments, or otherwise, as determined by the Committee.
9.2.FORFEITURE. Except as otherwise provided in the Award Agreement or other written document such as an employment agreement or a change of control agreement, upon a termination of employment (or termination of service in the case of a Consultant or Non-Employee Director) during the applicable performance period, Performance Share Awards that have not yet vested based on the attainment of the applicable performance goals shall be forfeited.
9.3.FORM AND TIMING OF PAYMENT.Payment for vested Performance Share Awards shall be made in the manner and at the time designated by the Committee in the Award Agreement. In the Award Agreement, the Committee may provide that payment will be made in cash or Stock, or in a combination thereof. As a general rule, the shares issued under any Performance Share Award (or cash delivered pursuant to such Award) will be paid to the Participant in a single lump sum within 60 days following the date on which the Performance Share Award vests.

SECTION 10
CHANGES IN CAPITAL STRUCTURE

10.1.SHARES AVAILABLE FOR GRANT. In the event of any change in the number of shares of Stock outstanding by reason of any stock dividend or split, recapitalization, merger, consolidation, combination or exchange of shares or similar corporate change, the maximum aggregate the number of shares available for grant under Section 5.1, the number of shares of Stock subject to any Award, and any numeric limitation expressed in the Plan shall be appropriately adjusted by the Committee. Any action taken pursuant to this Section 10.1 shall be taken in a manner consistent with the requirements of Section 409A of the Code and, in the case of Incentive Stock Options, in accordance with the requirements of Section 424(a) of the Code.
10.2.OUTSTANDING AWARDS - INCREASE OR DECREASE IN ISSUED SHARES WITHOUT CONSIDERATION. Subject to any required action by the stockholders of the Company, in

the event of any increase or decrease in the number of issued shares of Stock resulting from a subdivision or consolidation of shares of Stock or the payment of a stock dividend (but only on the shares of Stock), or any other increase or decrease in the number of such shares effected without receipt or payment of consideration by the Company, the Committee shall proportionally adjust the number of shares of Stock subject to each outstanding Award and the exercise price per share of Stock of each such Award. Any action taken pursuant to this Section 10.2 shall be taken in a manner consistent with the requirements of Section 409A of the Code and, in the case of Incentive Stock Options, in accordance with the requirements of Section 424(a) of the Code.
10.3.OUTSTANDING AWARDS - CERTAIN MERGERS. Subject to any required action by the stockholders of the Company, in the event that the Company shall be the surviving corporation in any merger or consolidation (except a merger or consolidation as a result of which the holders of shares of Stock receive securities of another corporation), each Award outstanding on the date of such merger or consolidation shall pertain to and apply to the securities that a holder of the number of shares of Stock subject to such Award would have received in such merger or consolidation. Any action taken pursuant to this Section 10.3 shall be taken in a manner consistent with the requirements of Section 409A of the Code and, in the case of Incentive Stock Options, in accordance with the requirements of Section 424(a) of the Code.
10.4.OUTSTANDING AWARDS - OTHER CHANGES. In the event of any other change in the capitalization of the Company or corporate change other than those specifically referred to in this Section 10, the Committee may, in its absolute discretion, make such adjustments in the number and class of shares subject to Awards outstanding on the date on which such change occurs and in the per share exercise price of each Award as the Committee may consider appropriate to prevent the dilution or enlargement of rights relating to Awards granted under the Plan. Any action taken pursuant to this Section 10.4 shall be taken in a manner consistent with the requirements of Section 409A of the Code and, in the case of Incentive Stock Options, in accordance with the requirements of Section 424(a) of the Code.
10.5.NO OTHER RIGHTS. Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend, any increase or decrease in the number of shares of stock of any class or any dissolution, liquidation, merger, or consolidation of the Company or any other corporation. Except as expressly provided in the Plan, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of shares of Stock subject to an Award or the exercise price of any Award.

SECTION 11
CHANGE OF CONTROL

11.1.TREATMENT OF AWARDS - ASSUMPTION/SUBSTITUTION. Except as otherwise provided in an Award Agreement or other written document such as an employment agreement or a change of control agreement, if a Change of Control occurs and Awards are converted, assumed, or replaced by a successor, the Committee shall have the discretion to cause all outstanding Awards to become fully exercisable and all restrictions on outstanding Awards to lapse. 
11.2.TREATMENT OF AWARD - NO ASSUMPTION/SUBSTITUTION. Except as otherwise provided in an Award Agreement or other written document such as an employment agreement or a change of control agreement, if a Change of Control occurs and Awards are not converted, assumed, or replaced by a successor, all outstanding Awards shall automatically become fully exercisable and all restrictions on outstanding Awards shall lapse. To the extent that this provision causes Incentive Stock Options to exceed

the dollar limitation set forth in Section 7.2(d), the excess Options shall be deemed to be Non-Qualified Stock Options. Upon, or in anticipation of, such an event, the Committee may cause every Award outstanding hereunder to terminate at a specific time in the future and shall give each Participant the right to exercise Awards during a period of time as the Committee, in its sole and absolute discretion, shall determine.
11.3.PARTICIPANT CONSENT NOT REQUIRED. Nothing in this Section 11 or any other provision of this Plan is intended to provide any Participant with any right to consent to or object to any transaction that might result in a Change of Control and each provision of this Plan shall be interpreted in a manner consistent with this intent. Similarly, nothing in this Section 11 or any other provision of this Plan is intended to provide any Participant with any right to consent to or object to any action taken by the Board or Committee in connection with a Change of Control transaction.

SECTION 12
OTHER PROVISIONS APPLICABLE TO AWARDS

12.1.AWARD AGREEMENTS. All Awards shall be evidenced by an Award Agreement. The Award Agreement shall include such terms and provisions as the Committee determines appropriate including, without limitation, non-solicitation provisions, non-competition provisions, confidentiality provisions and other restrictive covenant provisions the Committee deems appropriate. The terms of the Award Agreement may vary depending on the type of Award, the employee or classification of the employee to whom the Award is made and such other factors as the Committee deems appropriate.
12.2.FORM OF PAYMENT. Subject to the provisions of this Plan, the Award Agreement and any applicable law, payments or transfers to be made by the Company or any Subsidiary on the grant, exercise, or settlement of any Award made be made in such form as determined by the Committee including, without limitation, cash, Stock, other Awards, or other property, or any combination thereof, and may be made in a single payment or transfer, in installments, or any combination thereof, in each case determined by rules adopted by the Committee.
12.3.LIMITS ON TRANSFER.
a.General. Except as provided in Section 6.1(f), Section 7.1(f), Section 12.3(b) or Section 12.4, no Award granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, to, or in favor of, any party other than the Company or a Subsidiary, until the expiration of any period during which any vesting or transfer restrictions are applicable to the Award as determined by the Committee.
b.Transfer to Family Members. The Committee shall have the authority, in its discretion, to grant (or to sanction by way of amendment to an existing Award) Awards which may be transferred by the Participant during his or her lifetime to any Family Member. Unless transfers for the Participant have been previously approved by the Committee, the transfer of an Award to a Family Member may only be affected by the Company at the written request of the Participant. In the event an Award is transferred pursuant to this Section 12.3(b), such transferred Award may not be subsequently transferred by the transferee except by will or the laws of descent and distribution. A transferred Award shall continue to be governed by and subject to the terms and limitations of the Plan and relevant Award Agreement, and the transferee shall be entitled to the same rights as the Participant, as if the transfer had not taken place. 
12.4.BENEFICIARIES. Notwithstanding Section 12.3(a), a Participant may, in the manner determined by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any distribution with respect to any Award upon the Participant’s death. A beneficiary, legal guardian, legal

representative, or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any additional restrictions deemed necessary or appropriate by the Committee. If no beneficiary has been designated or survives the Participant, payment shall be made to the person entitled thereto pursuant to the Participant’s will or the laws of descent and distribution. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is provided to the Committee.
12.5.EVIDENCE OF OWNERSHIP. Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any certificates, make any book entry credits, or take any other action to evidence shares of Stock pursuant to the exercise of any Award, unless and until the Company has determined, with advice of counsel, that the issuance and delivery of such certificates, book entry credits, or other evidence of ownership is in compliance with all applicable laws, regulations of governmental authorities and, if applicable, the NYSE listing standards (or the rules of any exchange on which the Stock is then listed). All Stock certificates, book entry credits, or other evidence of ownership delivered pursuant to the Plan are subject to any stop-transfer orders and other restrictions as the Company deems necessary or advisable to comply with Federal, state, or foreign jurisdiction, securities or other laws, rules and regulations and the NYSE listing standards (or the rules of any exchange on which the Stock is then listed). If certificates representing shares of Stock are registered in the name of the Participant, the certificates must bear an appropriate legend referring to the applicable terms, conditions, and restrictions and the Company may, in its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse. In addition to the terms and conditions provided herein, the Company may require that a Participant make such reasonable covenants, agreements, and representations as the Company, in its discretion, deems advisable in order to comply with any such laws, regulations, or requirements.
12.6.CLAWBACK. Every Award issued pursuant to this Plan is subject to potential forfeiture or recovery to the fullest extent called for by law, any applicable listing standard, or any current or future clawback policy that may be adopted by the Company from time to time, including, without limitation, any clawback policy adopted to comply with the final rules issued by the Securities and Exchange Commission and the final listing standards to be adopted by the NYSE pursuant to Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. By accepting an Award, each Participant consents to the potential forfeiture or recovery of his or her Awards pursuant to applicable law, listing standard, and/or Company clawback policy, and agrees to be bound by and comply with the clawback policy and to return the full amount required by the clawback policy. As a condition to the receipt of any Award, a Participant may be required to execute any requested additional documents consenting to and agreeing to abide by the Company clawback policy as it may be amended from time to time.
12.7.MINIMUM VESTING REQUIREMENT. Subject to Section 5.3(d), no portion of any Award will vest prior to the twelve (12) month anniversary of the Date of Grant. Notwithstanding anything herein to the contrary, in an Award Agreement the Committee may include provisions calling for the accelerated vesting upon a Change of Control, the Participant’s death, Disability, “retirement,” “voluntary termination for good reason” or termination by the Company without Cause (as such terms are defined in the applicable Award Agreement).
12.8.DIVIDEND EQUIVALENTS. In the event an Award Agreement for any Award calls for the grant of dividend equivalents, such dividend equivalents shall be payable in accordance with the requirements of Section 409A or an exception thereto. With respect to any Award that vests based on the achievement of performance goals, in no event will any dividend equivalents vest or be paid prior to the vesting of the corresponding Award and such dividend equivalents shall only be paid to the Participant if and to the extent that the performance goals related to the corresponding Award are satisfied.

SECTION 13
AMENDMENT, MODIFICATION, AND TERMINATION

13.1.AMENDMENT, MODIFICATION AND TERMINATION OF THE PLAN. With the approval of the Board, the Committee may at any time, and from time to time, terminate, amend or modify the Plan; provided, however, that (a) to the extent necessary and desirable to comply with any applicable law, regulation, or NYSE listing rule (or the rules of any exchange on which the Stock is then listed), the Company shall obtain stockholder approval of any Plan amendment in such a manner and to such a degree as required; (b) except in the context of an adjustment described in Section 10, stockholder approval is required for any amendment to the Plan that: (i) increases the number of shares available under the Plan, (ii) permits the Committee to grant Options or SARs with an exercise price or base value that is below Fair Market Value on the Date of Grant, (iii) permits the Committee to extend the exercise period for any Option or SAR beyond ten (10) years from the Date of Grant, (iv) reprices or reduces the exercise price or base value of any previously granted Options or SARs (or would be treated as a repricing under applicable NYSE Listing Rules (or the rules of any exchange on which the Stock is then listed)), (v) expands the types of Awards available for grant under the Plan; or (vi) expands the class of individuals eligible to participate in the Plan; and (c) no such action shall be taken that would cause all or part of the payment under any Award to be subject to the additional tax under Section 409A of the Code.
13.2.AWARDS PREVIOUSLY GRANTED. No amendment, modification, or termination of the Plan or any Award under the Plan shall in any manner adversely affect in any material way the rights of the holder under any Award previously granted pursuant to the Plan without the prior written consent of the holder of the Award. Such consent shall not be required if the change: (a) is required by law or regulation; (b) does not adversely affect in any material way the rights of the holder; (c) is required to cause the benefits under the Plan to comply with the requirements of Section 409A of the Code; or (d) is made pursuant to any adjustment described in Section 10.

SECTION 14
TAX WITHHOLDING

The Company shall have the power to withhold, or require a Participant to remit to the Company, up to the maximum statutory amount necessary, in the applicable jurisdiction, to satisfy federal, state, and local withholding tax requirements on any Award under the Plan. The Committee may permit the Participant to satisfy a tax withholding obligation by: (a) directing the Company to withhold shares of Stock to which the Participant is entitled pursuant to the Award in an amount necessary to satisfy the Company’s applicable federal, state, local or foreign income and employment tax withholding obligations with respect to such Participant; (b) tendering previously-owned shares of Stock held by the Participant for six (6) months or longer to satisfy the Company’s applicable federal, state, local, or foreign income and employment tax withholding obligations with respect to the Participant (which holding period may be waived in accordance with Section 6.1(d)); (c) a broker-assisted “cashless” transaction; or (d) personal check or other cash equivalent acceptable to the Company.

SECTION 15
INDEMNIFICATION

To the extent allowable pursuant to applicable law, each person who is or shall have been a member of the Committee or of the Board shall be indemnified and held harmless by the Company against and from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a involved by reason of any action taken or failure to act under the Plan and against and from any and all amounts paid by him or her in settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such action, suit, or proceeding against him or her, provided he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he undertakes to handle and defend it on his or her behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such person may be entitled under the Company’s Articles of Incorporation or Bylaws, resolution or agreement, as a matter of law, or otherwise, or pursuant to any other power the Company may have to indemnify them or hold them harmless.

SECTION 16
GENERAL PROVISIONS

16.1.NO RIGHTS TO AWARDS. No Participant or other person shall have any claim to be granted any Award and neither the Company nor the Committee is obligated to treat Participants and other persons uniformly.
16.2.NO STOCKHOLDERS RIGHTS. No Award gives the Participant any of the rights of a stockholder of the Company unless and until shares of Stock are in fact issued to such person in connection with such Award.
16.3.NO RIGHT TO CONTINUED EMPLOYMENT OR SERVICES. Nothing in the Plan or any Award Agreement shall interfere with or limit in any way the right of the Company or any Subsidiary to terminate any Participant’s employment or service at any time, nor confer upon any Participant any right to continue in the employ or service of the Company or any Subsidiary.
16.4.UNFUNDED STATUS OF AWARDS. The Company shall not be required to segregate any of its assets to ensure the payment of any Award under the Plan. Neither the Participant nor any other persons shall have any interest in any fund or in any specific asset or assets of the Company or any other entity by reason of any Award, except to the extent expressly provided hereunder. The Plan is an unfunded performance-based bonus plan for a select group of management or highly compensated employees and is not intended to be either an employee pension or welfare benefit plan subject to ERISA.
16.5.RELATIONSHIP TO OTHER BENEFITS. No payment pursuant to the Plan shall be taken into account in determining any benefits pursuant to any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary.
16.6.EXPENSES. The expenses of administering the Plan shall be borne by the Company and its Subsidiaries.

16.7.TITLES AND HEADINGS. The titles and headings of the Sections in the Plan are for convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.
16.8.SECURITIES LAW COMPLIANCE. With respect to any Participant who is, on the relevant date, obligated to file reports pursuant to Section 16 of the Exchange Act, transactions pursuant to this Plan are intended to comply with all applicable conditions of Rule 16b-3 or its successors pursuant to the Exchange Act. Notwithstanding any other provision of the Plan, the Committee may impose such conditions on the exercise of any Award as may be required to satisfy the requirements of Rule 16b-3 or its successors pursuant to the Exchange Act. To the extent any provision of the Plan or action by the Committee fails to so comply, it shall be void to the extent permitted by law and voidable as deemed advisable by the Committee.
16.9.GOVERNMENT AND OTHER REGULATIONS. The granting of Awards and the issuance of shares and/or cash under the Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. The Company shall be under no obligation to register pursuant to the Securities Act, any of the shares of Stock paid pursuant to the Plan. If the shares of Stock paid pursuant to the Plan may in certain circumstances be exempt from registration pursuant to the Securities Act, the Company may restrict the transfer of such shares in such manner as it deems advisable to ensure the availability of any such exemption. The Committee shall impose such restrictions on any Award as it may deem advisable, including without limitation, restrictions under applicable federal securities law, under the requirements of the NYSE (or the rules of any exchange on which the Stock is then listed), and under any other blue sky or state securities law applicable to such Award.
16.10.GOVERNING LAW. The Plan and all Award Agreements shall be construed in accordance with and governed by the laws of the State of Maryland without regard to the conflict of laws provisions of any jurisdictions. All parties agree to submit to the jurisdiction of the state and federal courts of Arizona with respect to matters relating to the Plan and the Award Agreements and agree not to raise or assert the defense that such forum is not convenient for such party.
16.11.SECTION 409A OF THE CODE.
a.General Compliance. Some of the Awards that may be granted pursuant to the Plan (including, but not necessarily limited to, Restricted Stock Unit Awards and Performance Share Awards) may be considered to be “non-qualified deferred compensation” subject to Section 409A of the Code. If an Award is subject to Section 409A of the Code, the Company intends (but cannot and does not guarantee) that the Award Agreement and this Plan comply with and meet all of the requirements of Section 409A of the Code or an exception thereto and the Award Agreement shall include such provisions, in addition to the provisions of this Plan, as may be necessary to assure compliance with Section 409A of the Code or an exception thereto.
b.Delay for Specified Employees. If, at the time of a Participant’s Separation from Service, the Company has any Stock which is publicly traded on an established securities market or otherwise, and if the Participant is considered to be a Specified Employee, to the extent any payment for any Award is subject to the requirements of Section 409A of the Code and is payable upon the Participant’s Separation from Service, such payment shall not commence prior to the first business day following the date which is six (6) months after the Participant’s Separation from Service (or the date of the Participant’s death if earlier than the end of the six (6) month period). Any amounts that would have been distributed during such six month period will be distributed on the day following the expiration of the six (6) month period.
c.Prohibition on Acceleration or Deferral. Under no circumstances may the time or schedule of any payment for any Award that is subject to the requirements of Section 409A of the Code be accelerated or subject to further deferral except as otherwise permitted or required pursuant to regulations and other guidance issued pursuant to Section 409A of the Code. If the Company fails to make any payment pursuant to the payment provisions applicable to an Award that is subject to Section 409A of the Code, either

intentionally or unintentionally, within the time period specified in such provisions, but the payment is made within the same calendar year, such payment will be treated as made within the specified time period. In addition, in the event of a dispute with respect to any payment, such payment may be delayed in accordance with the regulations and other guidance issued pursuant to Section 409A of the Code.




GLOSSARY

a.“2006 Plan” means the Meritage Homes Corporation Amended and Restated 2006 Stock Incentive Plan.
b.“Award” means any Option, Stock Appreciation Right, Restricted Stock Award, Performance Share Award, Restricted Stock Unit Award granted to a Participant under the Plan.
c.“Award Agreement” means any written agreement, contract, or other instrument or document, including an electronic agreement or document, evidencing an Award, regardless of whether the Participant’s signature or acknowledgement is required.
d.“Board” means the Company’s Board of Directors, as constituted from time to time.
e.“Cause” means any of the following: means and will exist in the following circumstances in which the Participant: (i) is convicted of a felony; (ii) engages in any fraudulent or other dishonest act to the detriment of the Company; (iii) fails to report for work on a regular basis, except for periods of authorized absence or bona fide illness; (iv) misappropriates trade secrets, customer lists, or other proprietary information belonging to the Company for his or her own benefit or for the benefit of a competitor; (v) engages in any willful misconduct designed to harm the Company or its stockholders; or (vi) fails to perform properly his or her assigned duties. The definition of “Cause” in this Plan shall be superseded by the definition of “Cause” in any applicable change of control agreement or employment agreement that a Participant has with the Company.
f.“CEO” means the Chief Executive Officer of the Company.
g.“Change of Control” means any of the following: (i) a sale, transfer, or other disposition by the Company through a single transaction or a series of transactions of securities of the Company representing 50% or more of the combined voting power of the Company’s then outstanding securities to any “Unrelated Person” or “Unrelated Persons” acting in concert with one another; (ii) a sale, transfer, or other disposition through a single transaction or a series of related transactions of all or substantially all of the assets of the Company to an Unrelated Person or Unrelated Persons acting in concert with one another; or (iii) any consolidation or merger of the Company with or into an Unrelated Person, unless immediately after the consolidation or merger the holders of the common stock of the Company immediately prior to the consolidation or merger are the beneficial owners of securities of the surviving corporation representing at least 50% of the combined voting power of the surviving corporation’s then outstanding securities. For purposes of this definition, the term “Person” shall mean and include any individual, partnership, joint venture, association, trust, corporation, or other entity (including a “group” as referred to in Section 13(d)(3) of the Exchange Act) and the term “Unrelated Person” shall mean and include any Person other than the Company, or an employee benefit plan of the Company
A “Change of Control” will not be deemed to have occurred for purposes of the Plan until the transaction (or series of transactions) that would otherwise be considered a “Change of Control” closes. The transfer of Stock or assets of the Company in connection with a bankruptcy filing by or against the Company under Title 11 of the United States Code will not be considered to be a “Change of Control” for purposes of this Plan. Notwithstanding the foregoing a “Change of Control” shall not occur for purposes of this Plan in the case of Awards that are subject to the requirements of Section 409A of the Code unless such “Change of Control” constitutes a “change in control event” as defined in Section 409A of the Code and the regulations thereunder. The definition of “Change of Control” in this Plan shall be superseded by the definition of “Change

of Control” in any applicable change of control agreement or employment agreement that a Participant has with the Company.
h.“Code” means the Internal Revenue Code of 1986, as amended. All references to the Code shall be interpreted to include a reference to any applicable regulations, rulings or other official guidance promulgated pursuant to such section of the Code.
i.“Committee” means the Committee identified in Section 4.1.
j.“Company” means Meritage Homes Corporation.
k.“Consultant” means a consultant or advisor that provides bona fide services to the Company or any Subsidiary as an independent contractor and not as an employee; provided, however that such person may become a Participant in the Plan only if the Consultant: (i) is a natural person; and (ii) does not provide services in connection with the offer or sale of the Company’s securities in a capital-raising transaction and does not promote or maintain a market for the Company’s securities..
l.“Date of Grant” means the date the Committee approves the Award or a date in the future on which the Committee determines the Award will become effective.
m.“Disability” means that the Participant qualifies to receive long term disability payments under the Company’s long term disability insurance program, as it may be amended from time to time but, for purposes of any Incentive Stock Option, “Disability” shall have the meaning ascribed to it in Section 22(e)(3) of the Code. Except in the case of an Incentive Stock Option, the definition of “Disability” in this Plan shall be superseded by the definition of “Disability” in any applicable change of control agreement or employment agreement that a Participant has with the Company.
n.“Effective Date” means the date the Plan is approved by the stockholders at the Company’s 2018 Annual Meeting.
o.“ERISA” means the Employee Retirement Income Security Act of 1974, as amended. All references to a section of ERISA shall be interpreted to include a reference to any applicable regulations, rulings or other official guidance promulgated pursuant to such section of ERISA.
p.“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time. All references to the Exchange Act shall be interpreted to include a reference to any applicable regulations, rulings or other official guidance promulgated pursuant to such section of the Exchange Act.
q.“Executive Compensation Committee” means the Executive Compensation Committee of the Board of Directors which, shall consist of at least two (2) individuals, each of whom qualify as a: (i) a Non-Employee Director; and (ii) “independent director” for purposes of the NYSE listing standards. The composition of the Executive Compensation Committee may change from time to time in recognition of, response to, or in anticipation of, changes in applicable laws, rules, or regulations, including, without limitation, the Code and the NYSE listing standards (or the rules of any exchange on which the Stock is then listed).
r.“Expiration Date” means the tenth (10th) anniversary of the Effective Date.
s.“Fair Market Value” means, as of any given date, the fair market value of Stock on a particular date determined by such methods or procedures as may be established from time to time by the Committee. Unless otherwise determined by the Committee, the Fair Market Value of Stock as of any date shall be the closing price for the Stock as reported on the New York Stock Exchange (or on any national securities exchange on which the Stock is then listed) for that date or, if no such prices are reported for that date, the average of the high and low trading prices on the next preceding date for which such prices were reported.

t.“Family Member” means a Participant’s spouse and any parent, stepparent, grandparent, child, stepchild, or grandchild, including adoptive relationships or a trust or any other entity in which these persons (or the Participant) have more than 50% of the beneficial interest.
u.“Incentive Stock Option” means an Option that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto.
v.“Non-Employee Director” means a member of the Board who qualifies as a “Non-Employee Director” as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board.
w.“Non-Qualified Stock Option” means an Option that is not intended to be an Incentive Stock Option.
x.“Option” means a right granted to a Participant under Section 6, to purchase Stock at a specified price during specified time periods. An Option may be either an Incentive Stock Option or a Non-Qualified Stock Option.
y.“Participant” means a person who, as a member of the Board, or an employee, officer, or executive of, or Consultant to, the Company or any Subsidiary, has been granted an Award pursuant to the Plan.
z.“Performance Share Award” means a right granted to a Participant under Section 9, to receive cash or Stock, the payment of which is contingent upon achieving certain performance goals established by the Committee.
aa.“Plan” means this Meritage Homes Corporation 2018 Stock Incentive Plan, as amended from time to time.
bb.“Prior Plan” means the 2006 Plan, the Meritage Homes Corporation Stock Option Plan and any other similar plan adopted by the Company at any time in the past, which has not yet lapsed or expired.
cc.“Restricted Stock Award” means Stock granted to a Participant under Section 8 that is subject to certain restrictions and risk of forfeiture as determined by the Committee.
dd.“Restricted Stock Unit Award” means a right granted to a Participant under Section 8, to receive cash or Stock, the payment of which is subject to certain restrictions and risk of forfeiture as determined by the Committee.
ee.“Securities Act” means the Securities Act of 1933, as amended from time to time. All references to the Securities Act shall be interpreted to include a reference to any applicable regulations, rulings or other official guidance promulgated pursuant to such section of the Securities Act.
ff.“Separation from Service” is a term that applies only in the context of an Award that the Company concludes is subject to Section 409A of the Code and shall have the meaning set forth in Section 409A. Whether a “Separation from Service” has occurred will be determined based on all of the facts and circumstances and in accordance with Section 409A of the Code. In the case of a Non-Employee Director, Separation from Service means that such member has ceased to be a member of the Board. Whether an independent contractor consultant has incurred a Separation from Service will be determined in accordance with Treasury Regulation Section 1.409A‑1(h).
gg.“Specified Employee” means certain officers and highly compensated employees of the Company as defined in Treasury Regulation Section 1.409A-1(i).
hh.“Stock” means the common stock of the Company and such other securities of the Company that may be substituted for Stock pursuant to Section 10.

ii.“Stock Appreciation Right” or “SAR” means a right granted to a Participant under Section 7 to receive the appreciation on Stock.
jj.“Subsidiary” means any corporation or other entity of which a majority of the outstanding voting stock or voting power is beneficially owned directly or indirectly by the Company.