Board Justification

Carriage’s executive compensation programs align our executive pay with the Company’s operational and financial performance, as well as support our short-term and long-term business objectives. The Compensation Committee consists entirely of independent Board members and is responsible for the approval and oversight of compensation and employment agreements affecting Carriage’s NEOs. During 2022, the Compensation Committee continued to implement the executive compensation philosophy (the “Philosophy”), which was developed to formalize the strategy behind our executive compensation practices and to serve as an ongoing reference point for executive compensation decisions. The Philosophy has been developed based on our Being The Best Mission Statement and Five Guiding Principles and may be summarized in this manner: to attract, motivate, and retain exceptional 4E Leadership talent who are leaders within our High Performance Culture Executive Leadership Team (“First Who”). These leaders are expected to improve on the Company’s operating performance through attracting and motivating individual business Managing Partners and Houston Support Center leaders with 4E Leadership characteristics, continuously enhance our support functions, and make sound decisions regarding long-term stockholder value creation, particularly involving capital allocation (“Then What”); to provide transparency between pay, commensurate with individual and team contribution, and our annual and long-term Company performance; to motivate, reward, retain and reinvest in 4E Leadership that has established a proven record of success over time; and to align senior leadership interests with what is best for the Company and thus, what is best for our stockholders.

Board Justification

The 2022 cash incentive bonus of $925,000 for Mr. Payne was determined at the Compensation Committee meeting held in February 2023 and was made at the discretion of the Compensation Committee for the following reasons, but not limited to: The CEO sets the long-term Ten-Year Vision and Five-Year Strategy for Carriage and should be judged on the annual progress towards those goals versus short-term performance metrics that act as a budget; 2022 Performance; 2022 Performance compared to 2021 Performance and Five Year Trend; Strategic goals and execution thereof that could change the course and composition of the Company; Equity valuation; and 4E Leadership Development, particularly as it relates to members of the Strategic Vision and Principles Group.

Board Justification

The amount reflects benefits received for family members’ travel and reimbursement of certain travel expenses paid to our NEOs for award trips hosted by the Company. Additionally, with respect to Messrs. Payne and Phillips, this includes $2,149 for the payment of certain club membership dues and $25,606 for the payment of a one-time bonus, respectively.

Board Justification

None