SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant []
Check the appropriate box:
[] Preliminary Proxy Statement
[] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[x] Definitive Proxy Statement
[] Definitive Additional Materials
[] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
MASTEC, INC.
(Name of Registrant as Specified in Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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[x] No fee required
[] Fee computed on table below per Exchange Act Rules 14a-(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
_____________________________________________________________________
2) Aggregate number of securities to which transaction applies:
_____________________________________________________________________
3) Per unit price of other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
_____________________________________________________________________
4) Proposed maximum aggregate value of transaction
_____________________________________________________________________
5) Total fee paid:
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[] Fee paid previously with preliminary materials.
[] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing:
1) Amount Previously Paid:
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4) Date Filed:
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To our shareholders:
The 2000 Annual Meeting of Shareholders of MasTec, Inc. will be held on
Wednesday, May 17, 2000, at 9:30 a.m., local time, at our corporate headquarters
located at 3155 N.W. 77th Avenue, Miami, Florida. At the Annual Meeting,
shareholders will be asked to vote on the following proposals:
* The election of two Class II directors for terms expiring in 2003;
* An increase in the number of shares of Common Stock reserved for
issuance under MasTec's 1994 Stock Incentive Plan from 2,500,000 to
3,500,000 and certain related amendments to the plan; and
* Such other business as may properly be brought before the Annual
Meeting.
Each of these proposals is discussed more fully in the Proxy Statement
accompanying this notice. Only shareholders of record at the close of business
on March 21, 2000 are entitled to vote at the Annual Meeting. Shareholders,
including those whose shares are held by a brokerage firm or in "street" name,
will be asked to verify their shareholder status as of the record date upon
entrance to the meeting. Accordingly, shareholders (or their legal
representatives) attending the Annual Meeting should bring some form of
identification to the meeting evidencing shareholder status as of the record
date and, in the case of a person attending the meeting on behalf of a
shareholder, the representative's right to represent the shareholder at the
meeting.
All shareholders are cordially invited to attend the Annual Meeting in
person. However, to ensure that your stock is represented at the meeting in case
you are not personally present, you are requested to mark, sign, date and return
the enclosed proxy card as promptly as possible in the envelope provided. You
may not vote your shares of stock at the Annual Meeting unless you are present
in person or represented by proxy. Shareholders attending the Annual Meeting may
vote in person even if they have previously returned a proxy card.
By order of the Board of Directors
/s/Nancy J. Damon
Nancy J. Damon
Corporate Secretary
Miami, Florida
April 5, 2000
<PAGE>
PROXY STATEMENT
_______________
ANNUAL MEETING OF SHAREHOLDERS
MAY 17, 2000
_______________
GENERAL
The Board of Directors of MasTec, Inc. ("MasTec") is furnishing this Proxy
Statement to solicit proxies for use at the 2000 Annual Meeting of Shareholders
of MasTec, to be held at our corporate headquarters located at 3155 N.W. 77th
Avenue, Miami, Florida, on Wednesday, May 17, 2000, at 9:30 a.m., local time.
At the Annual Meeting, our shareholders will be asked to vote on the
following matters, each of which is described in greater detail elsewhere in
this Proxy Statement:
* The election of two Class II directors for terms expiring in 2003;
* An increase in the number of shares of Common Stock reserved for
issuance under MasTec's 1994 Stock Incentive Plan from 2,500,000 to
3,500,000 and certain related amendments to the plan; and
* Such other business as may properly be brought before the Annual
Meeting.
The Board of Directors recommends that you vote FOR each of the nominees
for Class II director set forth in this Proxy Statement and FOR the increase in
the shares reserved for issuance under the 1994 Stock Incentive Plan.
This Proxy Statement and accompanying proxy and other materials are first
being mailed on or about April 5, 2000 to shareholders of record on March 21,
2000. Only shareholders of record at the close of business on March 21, 2000 are
entitled to vote at the Annual Meeting. If you are not present in person at the
Annual Meeting, your shares can be voted only if represented by proxy. The
shares represented by your proxy will be voted in accordance with your
instructions only if you properly complete, sign and return the accompanying
proxy card to our Corporate Secretary prior to the Annual Meeting. If no choice
is specified, the shares represented by the proxy will be voted for the election
of all nominees for director, for the increase in the shares reserved for
issuance under the 1994 Stock Incentive Plan, and in the discretion of the
holder of the proxy on all other matters that may properly come before the
Annual Meeting. A proxy given pursuant to this solicitation may be revoked at
any time prior to its exercise by written notice delivered to our Corporate
Secretary, by executing and delivering to our Corporate Secretary a proxy with a
later date, or by attending the Annual Meeting and voting in person. Attendance
at the Annual Meeting will not, in itself, constitute revocation of a proxy.
<PAGE>
MasTec's only class of voting securities is its Common Stock. At March 21,
2000, there were 31,003,830 shares of our Common Stock outstanding, which is the
only class of MasTec's capital stock outstanding. As of March 21, 2000 MasTec
had 4,569 record shareholders, which does not include shareholders whose shares
are held of record by a brokerage firm or otherwise in "street name."
Each share of our Common Stock entitles its holder to one vote on all
matters properly brought before the Annual Meeting. The presence, in person or
by proxy, of a majority of the shares entitled to vote is necessary to
constitute a quorum at the Annual Meeting. If a quorum is present, directors are
elected by a plurality of the votes of the shares voting in person or
represented by proxy at the Annual Meeting, which means that the nominees
receiving the highest number of votes will be elected to the Board of Directors.
If a quorum is present, in order for the increase in the shares reserved for
issuance under the 1994 Stock Incentive Plan to be approved, the number of votes
cast in favor of the proposal must be greater than the number of votes cast
against the proposal.
Shares that are entitled to vote but that are not voted at the direction of
the beneficial owner ("abstentions"), shares represented by proxies or ballots
that are marked "withhold authority", and votes withheld by brokers in the
absence of instruction from beneficial holders ("broker nonvotes") will be
counted for the purpose of determining whether there is a quorum for the
transaction of business at the Annual Meeting. In determining whether a matter
requiring approval of a majority of the shares voting at the Annual Meeting has
been approved or whether a nominee for director has received a plurality of the
shares, abstentions, withheld votes and broker nonvotes will be disregarded and
will have no effect on the outcome of the vote.
ELECTION OF DIRECTORS
The first matter that shareholders will be asked to vote upon at the Annual
Meeting is the election of two Class II directors for terms expiring at the
annual meeting of shareholders in the year 2003. The Board of Directors
currently is comprised of eight directors elected in three classes, with two
Class I, three Class II, and two Class III directors. Directors in each class
hold office for three-year terms. The terms of the classes are staggered so that
the term of one class terminates each year. The terms of the current Class II
directors expire at the Annual Meeting; if elected, the nominees for Class II
directors will serve until the annual shareholders meeting in 2003. The terms of
the Class III directors expire at the annual shareholders meeting in 2001 and
the terms of the Class I directors expire at the annual meeting of shareholders
in 2002.
One of the current Class II directors, Eliot Abbott, has informed MasTec
that he does not wish to stand for reelection, and the Board of Directors, as
permitted by our bylaws, has resolved that the Board of Directors will be
comprised of seven directors (subject to further adjustment by the actions of
our Board of Directors or shareholders) following the expiration of the terms of
our current Class II directors at the Annual Meeting. The reduction in the size
of the Board of Directors will be effected by electing only two Class II
directors at the Annual Meeting.
<PAGE>
The following individuals have been nominated by the Nominating Committee
of the Board of Directors for election as the Class II directors to be elected
at the Annual Meeting:
* Olaf Olafsson
* William N. Shiebler
Additional background information regarding each of these nominees is
provided below. MasTec has no reason to believe that either of these nominees
will refuse or be unable to serve as a director if elected; however, if either
of the nominees is unable to serve, each proxy that does not direct otherwise
will be voted for a substitute nominee designated by the Board of Directors.
The election of directors requires the affirmative vote of a plurality of
the shares of Common Stock voting in person or by proxy at the Annual Meeting.
The Board of Directors recommends that you vote FOR each of the nominees named
above. Unless otherwise indicated, the accompanying form of proxy will be voted
FOR the election of each of the nominees for election as a Class II director
named above.
Information as to Nominees and Other Directors
Nominees for Class II Directors
Olaf Olafsson, 36, has been a member of the Board of Directors since
September 1999. Mr. Olafsson has been Vice Chairman of Time Warner Digital Media
since November 1999. Prior to joining Time Warner Digital Media, Mr. Olafsson
was President of Advanta Corporation, a financial services company, from March
1998 until October 1999 and a member of Advanta's Board of Directors since 1997.
Prior to joining Advanta, Mr. Olafsson was the founder and President of Sony
Interactive Entertainment, Inc., an interactive entertainment software and
hardware unit of Sony Corporation established in 1991. Mr. Olafsson also serves
on the Board of Directors of Scholastic Corp., a global children's publishing
and media company.
William N. Shiebler, 58, has been a member of the Board of Directors since
June 1999. Mr. Shiebler retired as a Senior Managing Director of Putnam
Investments, a Boston based investment management firm, in 1999. Mr. Shiebler
served as President of Putnam Mutual Funds from 1990 until 1998. Mr. Shiebler
has also been the Chairman of Pacific Corporate Group, a private equity
investment management and consulting firm, since March 1999. Before joining
Putnam, he was President and Chief Operating Officer of Dean Witter Reynolds
Intercapital, the investment management division of Dean Witter Reynolds, Inc.
Mr. Shiebler is a member of the Salt Lake City Olympic Organizing Committee.
Class III Directors
Arthur B. Laffer, 59, has been a member of the Board of Directors since
March 1994. Mr. Laffer has been Chairman of the Board of Directors of Laffer
Associates, an economic research and financial consulting firm, since 1979 and
Chief Executive Officer, Laffer Advisors Inc., an investment advisor and
broker-dealer, since 1981. Mr. Laffer is a director of Nicholas Applegate Mutual
Funds, Oxigene, Inc., Neff Corporation and Coinmach Laundry Corporation.
<PAGE>
Joseph P. Kennedy, II, 47, has been a member of the Board of Directors
since October 1999. Mr. Kennedy is Chairman of Citizens Energy Corporation, a
not-for-profit energy provider, which he founded in 1979. Mr. Kennedy served six
terms as a U.S. Representative during which time he was a member of the House
Banking and Financial Services Committee, a senior member of the House Veteran's
Affairs Committee and the co-chair of the Older American Caucus. He also served
as the ranking Democrat on the Housing and Community Opportunity Subcommittee.
Jose S. Sorzano, 59, has been a member of the Board of Directors since
October 1994. Mr. Sorzano has been Chairman of the Board of Directors of The
Austin Group, Inc., an international corporate consulting firm, since 1989. Mr.
Sorzano was also Special Assistant to the President for National Security
Affairs from 1987 to 1988; Associate Professor of Government, Georgetown
University, from 1969 to 1987; and Ambassador and U.S. Deputy to the United
Nations from 1983 to 1985.
Class I Directors
Jorge Mas, 37, has been our Chairman of the Board of Directors since
January 1998 and a director since March 1994. From March 1994 to October 1999,
Mr. Mas was our Chief Executive Officer. In addition, Mr. Mas is the Chairman of
the Board of Directors of Neff Corporation, a publicly held construction
equipment leasing company, is involved in several real estate holding companies
and is on the Board of Directors of First Union National Bank. Mr. Mas has been
Chairman of the Cuban American National Foundation, Inc., a not-for-profit
organization, since July 1999. Mr. Mas also serves on the board of directors of
Nova Southeastern University.
Joel-Tomas Citron, 37, has been our Chief Executive Officer since October
1999 and our President since May 1999. He has been a member of our Board of
Directors since January 1998 and Vice Chairman of the Board since November 1998.
Mr. Citron was the managing partner of Triscope Capital LLC, a private
investment partnership, from January 1998 until December 1998, and Chairman of
the Board of Directors of the United States subsidiary of Proventus AB, a
privately held investment company based in Stockholm, Sweden, from January 1992
to December 1997. Mr. Citron is also a member of the Board of Directors of Neff
Corporation; past Chairman of the Board of Directors of American Information
Systems, Inc. (now owned by Exodus Communications, Inc.), a provider of Internet
and Internet systems solutions; and a member of the Board of Directors of
Telergy, Inc., a facilities-based provider of integrated communications services
and high bandwidth fiber optic capacity in the northeast United States.
Other Information Regarding the Board of Directors
Board and Committee Meetings
During 1999, the Board of Directors met or acted by unanimous written
consent on 10 occasions. Each of the directors attended at least 75% of the
Board meetings and the meetings of committees of which such director is a member
held during the periods for which they served.
There are four standing committees of the Board of Directors: the Executive
Committee, the Audit Committee, the Compensation Committee, and the Nominating
Committee.
The Executive Committee is composed of Jorge Mas, who serves as Chairman,
Joel-Tomas Citron and Arthur Laffer. The principal function of the Executive
Committee is to act for the Board of Directors when action is required between
full Board meetings. During 1999, the Executive Committee met or acted by
unanimous written consent nine times.
The Audit Committee is composed of Arthur Laffer, who serves as Chairman,
and Eliot Abbott, Olaf Olafsson, and William N. Shiebler. A copy of the amended
Audit Committee charter has been attached as Exhibit "A". The Audit Committee is
charged, among other things, with:
o Reviewing and recommending to the Board of Directors the independent
auditors to be selected to audit the financial statements for MasTec, including
confirming the competence and independence of the auditors.
o Reviewing the scope of the proposed annual audit for the current year and
the audit procedures to be applied, including approving the annual audit fee
proposal from the independent auditors.
o Discussing with the independent auditors the matters required to be
discussed by Statement of Auditing Standards No. 61.
o Reviewing the completed audit, including any comments or recommendations
by the independent auditors, and monitoring the implementation of any
recommendations adopted by the Committee.
o Reviewing the financial statements and audit results with management.
o Reviewing the financial statements contained in MasTec's filed reports to
determine that the independent auditors are satisfied with the acceptability and
the quality of MasTec's accounting principles as applied in the financial
statements and that the information contained in the reports are consistent with
the financial statements.
o Recommending to the Board of Directors whether to include the audited
financial statements in MasTec's Annual Report or Form 10-K.
o Reviewing with financial management and the independent accountants
MasTec's quarterly earnings releases prior to release and MasTec's Quarterly
Report on Form 10-Q prior to its filing.
o Reviewing the adequacy and effectiveness of MasTec's accounting and
financial controls, including computerized information systems controls and
security.
o Reviewing the internal control function of MasTec, including the
independence and authority of its reporting obligations, the proposed internal
control plans for the coming year, and the coordination of such plans with the
independent auditors.
o Adopting a code of conduct for MasTec and periodically reviewing with
appropriate personnel the actions taken to ensure compliance with the code of
conduct and the results of violations of the code of conduct.
o Reviewing the programs and policies of MasTec designed to ensure
compliance with applicable laws and regulations and monitoring the results of
these compliance efforts.
o Investigating any matter brought to its attention within the scope of its
duties, including retaining independent counsel, accountants and others to
assist it in its investigations.
During 1999, the Audit Committee met on six occasions.
The Compensation Committee is composed of Arthur Laffer, who serves as
Chairman, Olaf Olafsson, Jose Sorzano and William Shiebler. The Compensation
Committee is charged with determining compensation packages for the Chief
Executive Officer and the Senior Vice Presidents of MasTec, establishing
salaries, bonuses and other compensation for MasTec's other executive and
operating officers, administering MasTec's stock option, stock purchase and
incentive compensation plans and recommending to the Board of Directors changes
to the plans. During 1999, the Compensation Committee met or acted by unanimous
consent on 12 occasions.
The Nominating Committee is composed of Eliott Abbott, who serves as
Chairman, and Jorge Mas and Joseph Kennedy, II. The Nominating Committee
recommends to the Board of Directors candidates for election to the Board of
Directors. The Committee considers candidates recommended by the shareholders
pursuant to written applications submitted to our Corporate Secretary.
Shareholder proposals for nominees should include biographical and other
information regarding the proposed nominee sufficient to comply with applicable
disclosure rules and a statement from the shareholder as to the qualifications
and willingness of the candidate to serve on our Board of Directors. During
1999, the Nominating Committee met on four occasions.
Compensation of Directors
Under MasTec's Non-Employee Directors' Stock Option Plan, our non-employee
directors are eligible to receive annually options to purchase shares of Common
Stock. The amount and exercise price of the options granted under this plan are
set by the Compensation Committee. Options issued under the plan are in lieu of
all other compensation to directors for their services as directors. MasTec does
not separately compensate its employee directors for their services as
directors. Directors are reimbursed for their reasonable expenses in attending
Board and committee meetings.
<PAGE>
Employment Agreements
Effective January 1, 2000, MasTec entered into a new employment agreement
with Mr. Citron relating to his employment as the Vice Chairman of the Board of
Directors, President and Chief Executive Officer. The new agreement is for a
term of two years unless earlier terminated, and provides that Mr. Citron will
be paid an annual salary of not less than $500,000 in 2000 and $600,000 in 2001.
The new agreement also provides for a bonus to be paid to Mr. Citron if MasTec
achieves certain budgeted levels of earnings before interest and taxes ("EBIT"),
and will be based on a percentage of EBIT, which is consistent with our service
line presidents' bonus plan. Additionally, if there is a change of control of
MasTec during Mr. Citron's employment term, Mr. Citron will be entitled to all
of the unpaid portion of his salary for the full term of this agreement, any
bonus that he would have earned for the year in which the change of control
occurs, and to certain payments based on stock price levels as well as immediate
vesting of any previously unvested options. This agreement also contains
non-competition and non-solicitation provisions.
<PAGE>
APPROVAL OF AN INCREASE IN THE NUMBER
OF SHARES RESERVED FOR ISSUANCE
UNDER MASTEC'S 1994 STOCK INCENTIVE PLAN
MasTec has adopted and our shareholders have previously approved the 1994
Stock Incentive Plan (the "Stock Incentive Plan"). The Stock Incentive Plan
currently provides for the issuance of an aggregate of 2,500,000 shares of
Common Stock, including restricted stock and stock issued upon the exercise of
stock options. As of March 21, 2000, only 67,644 shares of Common Stock remained
available for issuance under the plan.
On February 7, 2000, the Board of Directors approved an amendment to the
Stock Incentive Plan to increase the maximum number of shares of Common Stock
that may be issued under the plan by 1,000,000 and to make certain other related
amendments to the plan.
Shareholders are being asked to consider and approve the amendment to the
Stock Incentive Plan. Approval of the amendment requires the affirmative vote of
the holders of a majority of the shares of Common Stock present in person or by
proxy at the Annual Meeting. The amendment will be approved if the votes cast in
favor of the amendment are greater than the votes cast against the amendment.
The Board of Directors believes that awards under the Stock Incentive Plan
serve to attract, retain and motivate key employees, to enhance their incentive
to perform at the highest level and to contribute significantly to our success
by tying the compensation of these employees to MasTec's performance and
aligning their interests with the long-term interest of MasTec and its
shareholders. The Board of Directors believes that the proposed amendment
furthers these objectives by ensuring that a sufficient number of shares of
Common Stock are available to be granted or issued under the Stock Incentive
Plan.
The Board unanimously recommends a vote FOR approval of the amendment to
increase the number of shares of Common Stock that may be issued under the Stock
Incentive Plan. Unless otherwise indicated, the accompanying form of proxy will
be voted FOR the approval of the amendment.
Summary of the Stock Incentive Plan
The following is a summary of the significant features of the Stock
Incentive Plan, as it currently exists and as proposed to be amended. A copy of
the plan, as proposed to be amended, is attached to this Proxy Statement as
Exhibit "B."
Number of Shares Covered by the Plan
Subject to adjustment as noted below, the total number of shares that may
be optioned or awarded under the Stock Incentive Plan currently is 2,500,000
shares of Common Stock, of which 500,000 shares may be awarded as restricted
stock. This amount will increase to 3,500,000 shares, of which 1,000,000 shares
may be awarded as restricted stock, if the proposed amendment to the Stock
Incentive Plan is approved by shareholders. No employee may receive, over the
term of the Stock Incentive Plan, awards in the form of options to purchase more
than 500,000 shares of Common Stock, which number would be increased to
1,000,000 if the amendment is approved. Any shares subject to an option under
the Stock Incentive Plan that for any reason expires, is relinquished or is
terminated unexercised and any restricted stock that is forfeited may again be
optioned or awarded under the Stock Incentive Plan, except that forfeited shares
are not available for further awards if the employee has realized any benefits
of ownership from the forfeited shares.
<PAGE>
Eligible Participants in the Plan
Key employees, including officers, of MasTec and its subsidiaries, are
eligible to participate in the Stock Incentive Plan. The Compensation Committee
of the Board of Directors (the "Committee") administers the Stock Incentive Plan
and determines the recipients of options and awards, their terms and conditions
within the parameters of the Stock Incentive Plan and the number of shares
covered by each option or award. The Committee may approve rules and regulations
to carry out the Stock Incentive Plan and its decision with regard to any
question arising under the Stock Incentive Plan is final and conclusive. The
Committee members are not eligible to participate in the Stock Incentive Plan.
No award or option may be granted under the Stock Incentive Plan after
January 2004, but awards or options granted before that date may extend beyond
that date. The Board of Directors may amend, alter or discontinue the Stock
Incentive Plan, but no amendment, alteration or discontinuation may be made
which would (i) impair the right of any recipient of restricted stock or option
or stock bonus already granted, without his or her written consent, or (ii)
without the approval of the shareholders (A) increase the total number of shares
reserved for the Stock Incentive Plan, (B) decrease the option price of an
incentive stock option to less than 100% of the fair market value of the stock
on the date the option was granted, (C) change the class of persons eligible to
receive an award of restricted stock or options under the Stock Incentive Plan,
or (D) extend the duration of the Stock Incentive Plan. The Committee may,
retroactively or prospectively, amend the terms of any award of restricted stock
or option already granted without the holder's consent so long as the amendment
does not impair the rights of the holder.
Options and Option Price
The option price per share is determined by the Committee, but in the case
of an incentive stock option may not be less than 100% of the fair market value
of a share of Common Stock at the time the option is granted as reported on the
New York Stock Exchange. Options granted under the Stock Incentive Plan will
expire on a date fixed by the Committee, but not more than 10 years from the
date of grant in the case of incentive stock option. Options become exercisable
over a vesting period after the date of grant determined by the Committee.
Payment of the option price upon exercise of an option may be made in cash,
by the delivery of Common Stock already owned by the optionee, by a combination
of cash and shares, or in accordance with a cashless exercise program under
which shares of Common Stock may be issued directly to the optionee's broker or
dealer upon receipt of the purchase price in cash from the broker or dealer. No
optionee will have any rights to dividends or other rights of a shareholder with
respect to his or her shares subject to the option until the optionee has given
written notice of exercise and has paid in full for such shares. Tax withholding
obligations may be met by a withholding of stock otherwise deliverable to the
optionee under procedures approved by the Committee.
Each option granted under the Stock Incentive Plan may provide for stock
appreciation rights, that is, the right to exercise the option in whole or in
part without payment of the option price. If an option is exercised without
payment, the optionee will be entitled to receive the excess of the fair market
value of the stock covered by the option on the date of exercise over the option
exercise price. This amount is payable in stock or in cash or in a combination
of stock and cash at the discretion of the Committee.
If an optionee's employment terminates by reason of his or her retirement
under one of our retirement plans or because of death or permanent disability,
the optionee's option may thereafter be exercised by the optionee or by his or
her estate or beneficiary within the period specified in the option (not to
exceed three years from the date of termination) but not beyond the termination
date of the option. Unless otherwise determined by the Committee, if an
optionee's employment terminates for any reason other than retirement, death, or
permanent disability the optionee's option will terminate upon termination of
employment. During the optionee's lifetime, the option is exercisable only by
the optionee and may not be transferable except by will or the laws of descent
and distribution.
No incentive stock option may be granted to an employee who owns or would
own immediately before the grant of such option, directly or indirectly, stock
possessing more than 10% of the total combined voting power of all classes of
MasTec's stock. This restriction does not apply if, at the time such incentive
stock option is granted, the option price is at least 110% of the fair market
value of a share of Common Stock on the date of grant and the incentive stock
option by its terms is not exercisable after the expiration of five years from
the date of grant.
<PAGE>
Restricted Stock
Awards of restricted stock may be in addition to or in lieu of option
grants. During the restriction period, set by the Committee, the recipient of
restricted stock is not permitted to sell, transfer, pledge, or assign the
shares. Shares of restricted stock become free of all restrictions if the
recipient dies or his or her employment is terminated by reason of permanent
disability during the restriction period, and to the extent set by the
Committee, if the recipient retires under one of our retirement plans. In the
event of a termination of employment during the restriction period for any other
reason, all shares of restricted stock will be forfeited and revert to MasTec,
except to the extent that the Committee waives the forfeiture provision with
respect to all or some of the restricted stock held by the former employee.
The recipient of restricted stock is entitled to vote the shares and
receive all dividends paid thereon, except that dividends paid in shares of
Common Stock or other property will also be subject to the same restrictions as
those placed on the restricted shares. Tax withholding obligations for any grant
of restricted stock may be paid in cash by the recipient or may be met by
withholding Common Stock otherwise deliverable to the recipient pursuant to
procedures approved by the Committee.
In lieu of cash bonuses otherwise payable to eligible employees under
MasTec's compensation programs, the Committee may determine that such bonuses
will be paid in Common Stock or partly in Common Stock and partly in cash. Any
shares of Common Stock paid as bonuses will be free of any restrictions imposed
by the plan. MasTec will withhold from any cash bonuses an amount of cash
sufficient to meet its tax withholding obligations with respect to both cash and
Common Stock. If the cash portion of the bonus is not sufficient, the tax
withholding obligations must be paid in cash by the recipient or may be met by
the withholding of Common Stock otherwise deliverable to the recipient pursuant
to procedures approved by the Committee.
Change in Control; Recapitalization Provisions
In the event of a "change in control" of MasTec, in addition to any action
required or authorized by the option or award, the Committee may in its
discretion recommend that the Board of Directors take certain actions as a
result of, or in anticipation of, the change in control, to assure fair and
equitable treatment of the employees who hold options or restricted stock,
including an offer to purchase any outstanding option or restricted stock
granted or issued pursuant to the Stock Incentive Plan for its cash value as
determined by the Committee. However, in no event may an option be made
exercisable prior to the expiration of six months from the date of grant or, in
the case of an incentive stock option, after 10 years from the date it was
granted.
A "Change in control" is generally defined to include (i) a merger or
consolidation in which MasTec is not the surviving corporation or pursuant to
which any shares of MasTec are to be converted into cash, securities or other
property, or any sale, lease, exchange or other transfer of all, or
substantially all, of the assets of MasTec, (ii) the approval by the
shareholders of any plan for the liquidation or dissolution of MasTec, (iii)
subject to certain limited exceptions, the acquisition by a "person" or "group,"
as defined in the Stock Incentive Plan, of 33% or more of the Common Stock or
(iv) if individuals constituting the "Incumbent Board," as defined in the Stock
Incentive Plan, cease to constitute a majority of our Board of Directors.
Adjustments will be made in the number and class of shares available under
the Stock Incentive Plan and the number, class and price of shares subject to
outstanding option grants to reflect changes in the Common Stock through changes
in our corporate structure or capitalization such as through a merger or stock
split.
<PAGE>
Federal Income Tax Consequences
The following is a brief description of the material federal income tax
consequences, under existing law, to MasTec and recipients of awards under the
Stock Incentive Plan:
Incentive Stock Options
o Neither the grant nor the exercise (while the employee is employed or
within three months after termination of employment, or 12 months in the
case of termination on account of disability) of an incentive stock option
will be treated as the receipt of taxable income by the employee or as a
deductible item by MasTec. However the difference between the fair market
value of the option stock at exercise and the exercise price is treated as
an "item of adjustment" for alternative minimum tax purposes. The basis of
the incentive stock option for determining gain or loss for alternative
minimum tax purposes will be the exercise price for the incentive stock
option increased by the amount that the alternative minimum tax income was
increased due to the earlier exercise of the incentive stock option.
o If the employee holds shares acquired by him or her upon the exercise of an
incentive option for the two-year period from the date of grant of the
option and the one-year period beginning on the day after such exercise,
and if he or she has been an employee of MasTec or its subsidiaries at all
times from the date of grant to the day three months before exercise, or
twelve months in the case of termination on account of disability, then any
gain realized by the employee on a later sale or exchange of such shares
will be a long-term capital gain and any loss sustained will be a long-term
capital loss. MasTec will realize no tax deduction with respect to any such
sale or exchange of option shares.
o If the employee disposes of any shares acquired upon the exercise of an
option during the two-year period from the date of grant of the option or
the one-year period beginning on the day after such exercise, the employee
will generally be obligated to report as ordinary income for the year in
which the disposition occurred the amount by which the fair market value of
such shares on the date of the exercise of the option exceeds the option
price, and MasTec will be entitled to a deduction equal to the amount of
such ordinary income. Any such ordinary income will increase the employee's
tax basis for the purpose of determining gain or loss. If, however, a
disposition occurs in the year in which the option is exercised, the
maximum amount that will be included as alternative minimum tax income is
the gain on the disposition of the incentive stock option stock. Should
there be a disposition in a year other than the year of exercise, the
income on the disposition will not be considered income for alternative
minimum tax purposes.
o If an option holder who has acquired stock upon the exercise of an
incentive stock option makes a disposition within the two-year period
described above, and the disposition is a sale or exchange with respect to
which a loss (if sustained) would be recognized to the option holder, then
the amount includible in the option holder's gross income, and the amount
deductible by MasTec, will not exceed the excess (if any) of the amount
realized on the sale or exchange over the tax basis of the stock.
Non-Qualified Stock Options
In the case of an option granted under the Stock Incentive Plan that is not
an incentive stock option, the grant of the option will not result in taxable
income to the option holder or a tax deduction to MasTec. The option holder
recognizes ordinary income at the time the option is exercised in the amount by
which the fair market value of the shares acquired exceeds the option price.
MasTec is entitled to a corresponding ordinary income tax deduction at that
time, if applicable income and social security tax withholding requirements are
satisfied. The option holder's tax basis for purposes of determining gain or
loss on a subsequent sale of the shares is the fair market value of the shares
at the date of exercise of the option. The holding period for such shares will
commence on such date and, accordingly, will not include the period during which
the option was held. In the event of a sale of shares received upon exercise of
the option, any gain or loss will generally be a capital gain or loss. The
capital gain or loss will be a long-term capital gain or loss if the shares were
held for more than one year after the date on which the option was exercised.
Use of Stock to Exercise Options
The payment of the option exercise price by delivery of Common Stock will
constitute a non-taxable exchange by the optionee and will not affect the
incentive stock option status of the Common Stock acquired in the case of an
incentive stock option. However, if the Common Stock delivered in payment was
previously acquired pursuant to the exercise of an incentive stock option and
has not been held for the requisite one-year period, the exchange would
constitute a premature disposition of such Common Stock for purposes of the
incentive stock option holding requirements. Use of Common Stock in payment of
the option price will result in the same tax consequences to MasTec as if the
exercise were effected by a cash payment. The shares of stock received upon the
exercise of an incentive or non-qualified stock option equal to the number of
shares used to exercise the option will have a basis in the stock equal to the
basis that the employee had in the stock used in the exercise. The remaining
shares of stock will have a basis equal to the gain, if any, on the exercise of
the incentive or non-qualified stock option and any cash paid on the exercise.
Stock Appreciation Rights
The amount received by an optionee who exercises a stock appreciation right
with respect to his or her option is taxable as ordinary income at the time of
exercise and MasTec is entitled to a corresponding ordinary income tax
deduction.
Bonus Stock
The grantee will realize ordinary income during his or her taxable year in
which the shares of Common Stock are issued pursuant to the award of bonus stock
in an amount equal to the fair market value of the shares of Common Stock at the
date of issue. MasTec is entitled to a corresponding ordinary income tax
deduction. If the grantee thereafter disposes of such shares of Common Stock,
any amount received in excess of the market value of the shares on the date of
issue will be treated as long or short-term capital gain depending upon the
holding period of the shares.
Restricted Stock
A grantee will not realize any taxable income upon the award of restricted
stock unless a grantee elects under Section 83(b) of the Internal Revenue Code
(the "Code") to have the fair market value of the Common Stock (determined
without regard to the possibility of forfeiture) included in his or her gross
income in the year the restricted stock is issued. In the absence of such an
election, the grantee will realize ordinary income during his or her taxable
year in which the possibility of forfeiture lapses. If the grantee thereafter
disposes of the Common Stock, any amount received in excess of the fair market
value of the shares on the date the possibility of forfeiture lapsed will be
treated as long or short-term gain depending upon the holding period (measured
from the date the possibility of forfeiture lapsed) of the shares. MasTec will
be entitled to an ordinary tax deduction in the same amount and at the same time
the grantee is considered to have realized ordinary income.
Change in Control
Under certain circumstances, accelerated vesting or exercise of options or
stock appreciation rights, or the accelerated lapse of restrictions on
restricted stock, in conjunction with a "change in control" might be deemed an
"excess parachute payment" for purposes of the provisions of Section 280G of the
Code. To the extent it is so considered, the optionee or grantee may be subject
to a 20% excise tax and MasTec may be denied a tax deduction.
<PAGE>
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership as of March 21,
2000 of Common Stock by (i) each person known to MasTec to beneficially own more
than 5% thereof, (ii) each director of MasTec and each Named Executive Officer
(as defined under the caption Executive Compensation below), and (iii) all
executive officers and directors of MasTec as a group. Unless otherwise
indicated, each named shareholder has sole voting and investment power with
respect to the shares beneficially owned by the shareholder.
<TABLE>
Percent of
Amount of Common Stock
Name Common Stock Outstanding
---- ------------ ------------
<S> <C> <C> <C>
Jorge Mas 13,604,992 (1) 44%
Joel-Tomas Citron 230,894 (1) *
Eliot C. Abbott 25,669 (2) *
Arthur B. Laffer 128,178 (2) *
Olaf Olafsson ----- *
Joseph P. Kennedy, II ----- *
William N. Shiebler 10,172 *
Jose S. Sorzano 42,669 (2) *
Carmen M. Sabater 25,385 (2) *
Jose Sariego 23,004 (2) *
Arlene Vargas 1,280 (2) *
American Express Company/
American Express Financial Corp.
and Growth Portfolio 2,187,046 (3) 7%
All executive officers and
directors as a group
(15 persons) 13,964,959 45%
</TABLE>
* Less than 1%
(1) Includes 7,515,811 owned directly by the Jorge L. Mas Canosa Holdings I
Limited Partnership (the "Family Partnership"), and indirectly by Jorge Mas, as
an officer and the sole director of Jorge L. Mas Holdings Corporation, a Texas
corporation, the sole general partner of the Family Partnership; and 5,587,311
shares owned of record by Jorge Mas Holdings I Limited Partnership, a Texas
limited partnership ("Jorge Mas Holdings"). The sole general partner of Jorge
Mas Holdings is Jorge Mas Holdings Corporation, a Texas corporation that is
wholly-owned by Mr. Mas. Also includes 188,447 shares owned of record by the Mas
Family Foundation, a Florida not-for-profit corporation (the "Family
Foundation"); 167,826 shares covered by options exercisable within 60 days of
March 21, 2000; and 145,597 shares owned of record individually. Mr. Mas
disclaims beneficial ownership of the shares held by the Family Partnership
except to the extent of his pecuniary interest therein, and disclaims beneficial
ownership of all of the shares owned by the Family Foundation.
(2) The amounts shown include shares covered by options exercisable within
60 days of March 21, 2000 as follows: Joel-Tomas Citron, 222,341 shares; Eliot
C. Abbott, 24,167 shares; Arthur B. Laffer, 36,667 shares; Jose S. Sorzano,
41,167 shares; Carmen M. Sabater 21,500 shares; Jose Sariego, 12,226 shares, and
Arlene Vargas 1,000 shares.
(3) American Express Company ("AMEX"), American Express Financial Advisors
("AMEXFA") and Growth Portfolio ("GP") filed a Schedule 13G dated December 31,
1999 with the SEC reporting beneficial ownership of more than 5% of MasTec's
Common Stock. As reported in the Schedule 13G, GP possesses sole voting power
with respect to 1,800,000 shares and AMEX and AMEXFA possess shared voting power
with respect to 9,750 shares. As reported in the Schedule 13G, AMEX and AMEXFA
possess shared dispositive power with respect to 2,187,046 shares, with respect
to 1,800,000 of which GP also possesses shared dispositive power.
<PAGE>
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Based solely upon a review of the copies of the forms furnished to MasTec,
MasTec believes that, during the year ended December 31, 1999, all filing
requirements under Section 16(a) of the Securities Exchange Act of 1934
applicable to its officers, directors and greater than 10% beneficial owners
were complied with on a timely basis with the exception of Joseph P. Kennedy, II
who filed a Form 3 on November 16, 1999 to report his election as a director of
MasTec on October 4, 1999, Carmen M. Sabater, who filed a Form 4 on March 23,
2000 to report her option grant of 7,500 shares on December 15, 1999, and Jose
Sariego, who filed a Form 4 on March 23, 2000 to report his option grant of
7,500 shares on December 15, 1999.
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Report of the Compensation Committee
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for establishing and administering the policies for MasTec's
compensation programs and for approving the compensation levels of the
executives and managers of MasTec, including its Chief Executive Officer. The
Committee also reviews with the Chief Executive Officer guidelines for salaries
and bonus awards applicable to MasTec's employees other than its executives and
managers. The Committee is composed of Arthur B. Laffer, who serves as Chairman,
and Olaf Olafsson, William N. Shiebler and Jose S. Sorzano, all of whom are
non-employee directors of MasTec.
Statement of Philosophy of Executive Compensation
The executive compensation program of MasTec is designed to (i) provide
base compensation reasonably comparable to that offered by other leading
companies to their executives and managers so as to attract and retain talented
personnel, (ii) motivate executives and managers to achieve the strategic goals
set by MasTec by linking an executive's or a manager's incentive compensation to
the performance of MasTec and applicable business units, as well as to
individual performance, and (iii) align the interests of MasTec's executives and
managers with the long-term interests of its shareholders through the award of
stock options and other stock-related programs. To implement this philosophy,
MasTec offers its executives and managers compensation packages that include a
mix of salary, incentive bonus awards, and stock options.
In determining the level and form of executive compensation to be paid or
awarded, the Committee relies primarily on MasTec's results of operations and,
in the case of senior executives, an assessment of MasTec's overall performance
in light of its strategic objectives. The Committee considered a number of
factors in establishing 1999 compensation, none of which were quantified, ranked
or assigned relative weights.
o The substantial increase in revenue and earnings in comparison to
prior years.
o The substantial increase in MasTec's stock price from prior years.
o The significant consolidation and reorganization of MasTec's core
North American infrastructure service business into more efficient
service lines organized by customer groups.
o The further diversification and expansion of MasTec's core business
through fold-in acquisitions.
o The continued divestiture of non-core assets to concentrate resources
on MasTec's core business.
o Individual performance
Salary
The base salary of executives and managers is determined initially by
analyzing and evaluating the responsibilities of the position and comparing the
proposed base salary with that of executives and managers in comparable
positions in other companies. Adjustments are determined by objective factors
such as MasTec's performance and the individual's contribution to that
performance and subjective considerations such as additional responsibilities
taken on by the executive or manager for 1999. The Committee awarded increases
in base salary to certain of the executive officers and managers of MasTec,
including certain of the Named Executive Officers identified under the caption
"Executive Compensation" below.
<PAGE>
Incentive Awards
In addition to paying a base salary, MasTec awards incentive bonuses as a
component of overall compensation. MasTec has established formal incentive
compensation plans for our senior executives at both the corporate and
operational levels that awards incentive bonuses based on MasTec's or an
individual unit's performance as measured by earnings before interest and taxes
("EBIT") and return on assets. Awards are based on a multiple of base salary or
a percentage of EBIT. A portion of the bonus is awarded in stock and stock
options. MasTec or the individual unit must meet certain minimum thresholds
before any bonus is earned. For 1999, the Committee awarded bonuses, including
restricted stock and stock options, to certain of MasTec's executives and
managers, including the Named Executive Officers, under these plans.
CEO Compensation
Pursuant to our existing employment agreement with Joel-Tomas Citron, our
President and Chief Executive Officer, MasTec was obligated to pay Mr. Citron a
bonus of $600,000 upon the achievement of a certain stock price level, which was
achieved. Additionally, due to MasTec's strong performance in 1999, the
Committee awarded Mr. Citron an additional bonus of $400,000, a portion of which
was paid in Common Stock. The Committee also awarded Mr. Citron options to
purchase 300,000 shares of Common Stock at an exercise price equal to the fair
market value of the Common Stock on the date of grant.
During a portion of 1999, Jorge Mas served as President and Chief Executive
Officer of MasTec. For his services in 1999 and prior years, the Committee
granted Mr. Mas options or stock appreciation rights with respect to 500,000
shares of Common Stock at an exercise price equal to the fair market value of
the Common Stock on the date of grant. Mr. Mas continues to serve as Chairman of
the Board of Directors, but is no longer an executive officer of MasTec.
Compensation Committee
Arthur B. Laffer
Olaf Olafsson
William N. Shiebler
Jose S. Sorzano
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table summarizes all compensation awarded to, earned by or
paid to (a) MasTec's Chief Executive Officer and (b) the four other most highly
compensated executive officers of MasTec whose total salary and bonus exceeded
$100,000 (together, the "Named Executive Officers") for services rendered in all
capacities to MasTec and its subsidiaries for the years ended December 31, 1999,
1998 and 1997.
<TABLE>
Long Term Compensation
-------------------------
Annual Compensation Awards
-------------------------------- -------------------------
Other Annual Restricted Securities All Other
Compensation Stock Underlying Compen-
Name and Salary Bonus Awards Options/SARS sation
Principal Position Year $ ($)(3) ($) #
- ------------------ ---- ------ ------ ------------ ---------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Jorge Mas, Chairman of 1999 325,450 -- -- -- 500,000 6,000
the Board of 1998 330,675 -- -- -- -- 6,000
Directors(1) 1997 325,000 234,100 -- -- 100,000 6,000
Joel-Tomas Citron 1999 311,538 1,000,000 -- -- 300,000 --
Vice-Chairman of the 1998 123,076 -- -- -- 250,000 --
Board, President and 1997 -- -- -- -- -- --
Chief Executive Officer
(2)
Carmen M. Sabater 1999 168,462 225,000 -- 65,000 540
Senior Vice President/ 1998 174,267 -- -- -- -- 540
Chief Financial Officer 1997 -- -- -- -- -- --
(2)
Jose Sariego 1999 175,150 175,000 -- 32,500 935
Senior Vice President/ 1998 171,605 -- -- -- -- 880
General Counsel 1997 150,000 84,276 -- -- 15,000 814
Arlene Vargas 1999 125,225 65,500 -- 5,000 --
Vice President/ 1998 -- -- -- -- -- --
Controller(2) 1997 -- -- -- -- -- --
</TABLE>
(1) Mr. Mas served as our Chief Executive Officer until October 1999, at which
time Mr. Citron became our Chief Executive Officer.
(2) In 1997, Joel-Tomas Citron and Carmen Sabater were not executive officers.
In 1997 and 1998, Arlene Vargas was not an executive officer.
(3) The 1999 bonuses were paid in a combination of cash and unrestricted stock
valued at fair market value on the date of grant as follows: Joel-Tomas
Citron $150,000 in stock; Carmen M. Sabater $26,500 in stock; Jose Sariego
$26,500 in stock; Arlene Vargas $9,375 in stock.
<PAGE>
Option Grants
The following table provides information with respect to stock options to
purchase Common Stock granted to the Named Executive Officers for the year ended
December 31, 1999:
<TABLE>
Potential Realizable Value
At Assumed Annual Rates of
Stock Price Appreciation for
Individual Grants Option Term (3)
----------------------------------------------------- ----------------------------
Percent of
Total
Number Options
of Shares Granted to
Underlying Employees Exercise
Options in Fiscal Price Expiration
Name Granted Year (1) ($/sh)(2) Date 5% 10%
---- ---------- ---------- --------- ---------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Jorge Mas 500,000 25.5% $29.6875 10/04/09 $8,553,788 $21,603,122
Joel-Tomas Citron 300,000 15.3% $29.6875 10/04/09 $5,601,093 $14,194,269
Carmen M. Sabater 57,500 2.9% $29.6875 10/04/09 $1,073,543 $2,720,568
7,500 0.4% $40.1875 12/15/06 $189,553 $480,364
Jose Sariego 25,000 1.3% $29.6875 10/04/09 $466,758 $1,182,856
7,500 0.4% $40.1875 12/15/06 $189,553 $480,364
Arlene Vargas 5,000 0.3% $40.1875 12/15/06 $126,368 $320,243
</TABLE>
(1) Based on options to purchase an aggregate of 1,964,166 shares of Common
Stock granted to employees for 1999.
(2) All options were granted at an exercise price equal to fair market value
based on the mean between the high and low sale prices of the Common Stock
on the New York Stock Exchange on the date of grant.
(3) Potential gains are net of exercise price, but before taxes associated with
exercise. These amounts represent certain assumed rates of appreciation
only, based on Securities and Exchange Commission rules, and do not
represent MasTec's estimate or projection of the price of MasTec's stock in
the future. Actual gains, if any, on stock option exercises depend upon the
actual future performance of MasTec's Common Stock and the continued
employment of the option holders throughout the vesting period.
Accordingly, the potential realizable values set forth in this table may
not be achieved or may be exceeded.
<PAGE>
Aggregate Option Exercises and Year-End Option Values
The following table sets forth information with respect to each exercise of
stock options during the fiscal year ended December 31, 1999 by the Named
Executive Officers and the value at December 31, 1999 of unexercised stock
options held by the Named Executive Officers.
<TABLE>
Number of Shares Value of Unexercised In-
Underlying Unexercised the-Money Options at
Shares Options at December 31, 1999 December 31, 1999
Acquired Value (#) ($)(1)
On Exercise Realized Exercisable/Unexercisable Exercisable/Unexercisable
(#) ($)
----------- -------- ---------------------------- -------------------------
<S> <C> <C> <C> <C> <C> <C>
Jorge Mas 0 $0 181,199/598,801 $5,624,386/$10,579,556
Joel-Tomas Citron 0 $0 222,341/337,659 $5,185,688/ $5,142,973
Carmen M. Sabater 0 $0 17,000/ 81,500 $471,277/ $1,239,675
Jose Sariego 7,709 $157,216 14,991/ 52,300 $384,060/ $877,361
Arlene Vargas 0 $0 1,000/ 9,000 $29,281/ $135,719
</TABLE>
(1) Market value of shares underlying in-the-money options at December 31, 1999
based on the product of $43.9 per share, the fair market value of MasTec's
Common Stock on the New York Stock Exchange on December 31, 1999, less the
exercise price of each option, times the number of in-the-money options as
of that date.
Performance Table
The following table compares the cumulative total shareholder return on
MasTec's Common Stock from December 31, 1994 through December 31, 1999 with the
cumulative total return of the S & P 500 Stock Index and a company-constructed
index of (a) seven peer companies consisting of Able Telcom Holding Corp.,
Amerilink Corp., Arguss Holdings, Inc. Dycom Industries, Inc., International
Fibercom, Inc. MYR Group, Inc., and Quanta Services, Inc., (the "Old Peer
Group"), and (b) eight peer companies consisting of Able Telecom Holding Corp,
Arguss Holdings, Inc., Black Box Corp., Dycom Industries, Inc., International
Fibercom, Inc., LCC International Inc., Quanta Services, Inc., and Wireless
Facilities Inc., (the "New Peer Group"). The table assumes that the value of the
investment in the Common Stock was $100 on December 31, 1994 and that all
dividends were reinvested. This data is not necessarily indicative of future
results. The change in the composition of the peer group is to include new
public companies that qualify as industry peers, to delete certain companies
that are no longer public, and to achieve a more representative comparison of
performance.
<TABLE>
12/31/94 12/31/95 12/31/96 12/31/97 12/31/98 12/31/99
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
MasTec $100.00 $129.27 $517.07 $334.76 $307.32 $651.22
New Peer Group $100.00 $118.60 $329.91 $277.56 $341.80 $513.73
Old Peer Group $100.00 $124.16 $157.29 $291.69 $543.35 $643.93
S & P 500 $100.00 $137.58 $169.17 $225.61 $290.09 $351.13
</TABLE>
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As of December 31, 1999, the estate of Jorge L. Mas, Jorge Mas, Juan Carlos
Mas and Jose Ramon Mas remained indebted to MasTec for $500,000, $713,800,
$169,000, and $143,000, respectively, plus accrued interest. Subsequent to
December 31, 1999, the indebtedness of Jorge Mas was paid in full.
MasTec purchases and leases equipment from a company in which Jorge Mas has
a significant interest. MasTec believes the value of these transactions is not
material.
SELECTION OF AUDITORS
PricewaterhouseCoopers LLP was appointed by the Board of Directors of
MasTec to audit MasTec's financial statements for 1999. PricewaterhouseCoopers
LLP has acted as independent public accountants for MasTec since 1995.
Representatives of PricewaterhouseCoopers LLP will be present at the Annual
Meeting, will have an opportunity to make a statement if they so desire and will
be available to respond to appropriate questions from shareholders.
MISCELLANEOUS
A list of MasTec's shareholders as of March 21, 2000, the record date for
the Annual Meeting, will be available for inspection at our corporate
headquarters located at 3155 N.W. 77th Avenue, Miami, Florida, during normal
business hours during the 10 day period prior to the Annual Meeting.
Solicitation of proxies will be made initially by mail. Our directors,
officers and employees also may solicit proxies in person or by telephone
without additional compensation. In addition, proxies may be solicited by
certain banking institutions, brokerage firms, custodians, trustees, nominees
and fiduciaries who will mail material to or otherwise communicate with the
beneficial owners of shares of MasTec's Common Stock. In addition, Corporate
Investor Communications, Inc. has been engaged by MasTec to act as proxy
solicitors and will be paid $4,000. The cost of this solicitation will be borne
by MasTec.
Pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, if a
shareholder notifies MasTec after December 15, 2000, of an intent to present a
proposal at MasTec's annual meeting of shareholders in the year 2001 (and for
any reason the proposal is voted upon at that Annual Meeting), MasTec's proxy
holders will have the right to exercise discretionary voting authority with
respect to the proposal, if presented at the meeting, without including
information regarding the proposal in our proxy materials. Any proposal of an
eligible shareholder intended to be presented at the annual meeting of
shareholders of MasTec in 2001 must be received by MasTec by February 25, 2001
to be eligible for inclusion in MasTec's proxy statement and form of proxy
relating to that annual meeting.
The Board of Directors does not intend to present and knows of no others
who intend to present at the Annual Meeting any matter or business other than
that set forth in the accompanying Notice of Annual Meeting of Shareholders. If
other matters are properly brought before the Annual Meeting, it is the
intention of the persons named in the accompanying form of proxy to vote any
proxies on such matters in accordance with their judgment.
MasTec's Annual Report on Form 10-K for the fiscal year ended December 31,
1999 is being mailed with this Proxy Statement to shareholders of record on
or about April 5, 2000.
By order of the Board of Directors
/s/ Nancy J. Damon
Nancy J. Damon
Corporate Secretary
Miami, Florida
April 5, 2000
<PAGE>
EXHIBIT "A"
MASTEC, INC.
Audit Committee Charter
January 1, 2000
Organization
The Audit Committee will be composed of three or more members of the Board
of Directors who (1) are free of any relationship to the company that, in the
opinion of the Board of Directors, may interfere with their exercise of
independent judgment from management and the Company, and (2) are financially
literate, as determined by the Board of Directors in its business judgment. At
least one member must have accounting or related financial management expertise,
as determined by the Board of Directors in its business judgment.
Policy statement
The Audit Committee will assist the Board of Directors in fulfilling its
responsibility to the shareholders regarding the quality and integrity of the
Company's accounting and reporting practices and internal controls. In carrying
out this responsibility, the Audit Committee should dialog with management of
the Company and the Company's outside auditor regarding the Company's financial
reporting and controls. The Audit Committee recognizes that (a) the outside
auditor for the Company is ultimately accountable to the Audit Committee and the
Board of Directors; (b) the Audit Committee and the Board of Directors have the
ultimate authority and responsibility to select and evaluate, and where
appropriate, replace the outside auditor (or to nominate the outside auditor to
be proposed for shareholder approval in any proxy statement); (c) the Audit
Committee is responsible for ensuring that the outside auditor submits, on a
periodic basis to the Audit Committee, a formal written statement delineating
all relationships between the auditor and the Company; and (d) the Audit
Committee is responsible for actively engaging in a dialogue with the outside
auditor with respect to any disclosed relationships or services that may impact
the objectivity and independence of the outside auditor and for recommending
that the Board of Directors take appropriate action in response to the outside
auditors' report to satisfy itself of the outside auditors' independence.
Responsibilities
The Audit Committee is responsible for the following on behalf of the Board
of Directors:
1) Reviewing and recommending to the Board of Directors the independent
auditors to be selected to audit the financial statements for the Company,
including confirming the competence and independence of the auditors as
required by Independent Standards Board Standard No. 1, as may be modified
or supplemented.
2) Reviewing the scope of the proposed annual audit for the current year and
the audit procedures to be applied, including approving the annual audit
fee proposal from the independent auditors.
3) Discussing with the independent auditors the matters required to be
discussed by Statement of Auditing Standards No. 61, as may be modified or
supplemented.
4) Reviewing the completed audit, including any comments or recommendations by
the independent auditors, and monitoring the implementation of any
recommendations adopted by the Committee.
5) Reviewing the financial statements and audit results with management.
6) Reviewing the financial statements contained in the Company's filed reports
to determine that the independent auditors are satisfied with the
acceptability and the quality of the Company's accounting principles, as
applied, in the financial statements and that the information contained in
the reports are consistent with the financial statements.
7) Recommending to the Board of Directors whether to include the audited
financial statements in the Company's annual report or form 10-K. Reviewing
with management and the independent auditors the interim financial reports
before they are filed with the SEC or other regulators.
8) Reviewing with financial management and the independent accountants, the
Company's quarterly earnings releases prior to release and the Company's
form 10-Q prior to its filing. The Chairman of the Committee may represent
the entire Committee for purposes of this review.
9) Reviewing the adequacy and effectiveness of the Company's accounting and
financial controls, including computerized information systems controls and
security. Particular emphasis should be given to the adequacy of such
internal controls to expose any payments, transactions, or procedures that
might be deemed illegal or otherwise improper.
10) Reviewing the internal control function of the Company, including the
independence and authority of its reporting obligations, the proposed
control plans for the coming year and the coordination of such plans with
the independent auditors.
11) Providing sufficient opportunity for the independent auditors to meet with
the members of the Audit Committee without members of management present.
Among the items to be discussed in these meetings are the independent
auditors' evaluation of the Company's financial, accounting and auditing
personnel, and the cooperation that the independent auditors received
during the course of the audit.
12) Adopting a Code of Conduct for the Company and periodically reviewing with
appropriate company personnel the actions taken to ensure compliance with
the Code of Conduct and the results of violations of the Code.
13) Reviewing the programs and policies of the Company designed to ensure
compliance with applicable laws and regulations and monitoring the results
of these compliance efforts.
14) Submitting the minutes of all meetings of the Audit Committee to, or
discussing the matters discussed at each Committee meeting with, the Board
of Directors.
15) Investigating any matter brought to its attention within the scope of its
duties, including retaining independent counsel, accountants and others to
assist it in its investigations.
16) Reviewing and updating the Committee's Charter on an annual basis.
17) Issuing such reports and certifications as may be required under the rules
and regulations of the Securities and Exchange Commission, the New York
Stock Exchange, and any other similar requirements.
18) Considering such other matters in relation to the financial affairs of the
Company and its accounts, and in relation to the internal and external
audits of the Company, as the Audit Committee may, in its discretion,
determine to be advisable.
<PAGE>
EXHIBIT "B"
MASTEC, INC.
1994 STOCK INCENTIVE PLAN
(As Amended May 17, 2000)
1. Purpose. The purpose of the MasTec, Inc. 1994 Stock Incentive Plan (the
"Plan") is to increase the interest of the executives, managers and other
key employees of MasTec, Inc. and its subsidiaries in MasTec's business
through the added incentive created by the opportunity afforded for stock
ownership under the Plan. Stock ownership will provide these employees with
a further stake in the future welfare of MasTec and encourage them to
remain with MasTec and its subsidiaries. It is also expected that the Plan
will encourage qualified persons to seek and accept employment with MasTec
and its subsidiaries. Pursuant to the Plan, eligible employees will be
offered the opportunity to acquire MasTec common stock ("Common Stock")
through the grant of options, the award of restricted stock under the Plan,
bonuses payable in stock or a combination thereof. As used in this Plan,
the term "subsidiary" means any present or future corporation which is or
would be a "subsidiary corporation" of MasTec as the term is defined in
Section 424(f) of the Internal Revenue Code of 1986 (the "Code").
2. Administration of the Plan.
(a) Committee. The Plan will be administered by the Board of Directors of
MasTec (the "Board"). The Board, however, may at any time appoint a
committee (the "Committee") of two or more Board members and delegate
to such Committee one or more of the administrative powers allocated
to the Board pursuant to the provisions of the Plan. Members of the
Committee will serve for such period of time as the Board may
determine and will be subject to removal by the Board at any time. The
Board may also at any time terminate the functions of the Committee
and reassume all powers and authority previously delegated to the
Committee.
(b) Powers of the Board. Subject to the provisions of the Plan, the Board
of Directors will have the authority, in its discretion: (i) to grant
awards of stock options, restricted stock, stock bonuses or other
awards pursuant to the terms of the Plan; (ii) to determine the fair
market value of the Common Stock of MasTec; (iii) to determine the
exercise price per share of options to be granted; (iv) to determine
the persons to whom, and the time or times at which, options or other
awards will be granted and the number of shares to be represented by
each option or award; (v) to determine the vesting schedule of options
to be granted; (vi) to prescribe, amend and rescind rules and
regulations relating to the Plan; (vii) to determine the terms and
provisions of each award granted under the Plan (which need not be
identical) including, without limitation, those relating to
forfeiture, payment and exercisability; (viii) to accelerate the
vesting date of any award; (ix) to authorize any person to execute on
behalf of MasTec any instrument required to effectuate the grant of an
award previously granted by the Board; (x) subject to the provisions
of the Plan and subject to such additional limitations and
restrictions as the Board may impose, to delegate to specific members
of management or to a committee of management personnel the authority
to determine: (A) the persons to whom, and the time and times at
which, awards will be granted and the number of shares to be
represented by each option or award; (B) the vesting schedule of
options; (C) the term of awards; and (D) other terms and conditions of
any options or awards, provided that the Board will not have the
authority to delegate such matters with respect to awards to be
granted to any person ("Insiders") subject to Section 16 of the
Securities Exchange Act of 1934 (the "Exchange Act") or any "covered
employee" under Section 162(m) of the Code; and (xi) to interpret the
Plan and make all other determinations deemed necessary or advisable
for the administration of the Plan. The Board may require the
voluntary surrender of all or any portion of any option granted under
the Plan as a condition precedent to a grant of a new option to such
optionee. Subject to the provisions of the Plan, such new option will
be exercisable at the price, during the period and on such other terms
and conditions as are specified by the Board at the time the new
option is granted. Upon surrender, the options surrendered will be
unexercisable and the shares previously subject to such options will
be available for the grant of other options.
(c) Effect of the Board's Decision. All decisions, determinations and
interpretations of the Board of Directors will be final and binding on
all employees of MasTec and its subsidiaries participating or eligible
to participate in the Plan.
3. Agreements. Each option or stock or other awards granted pursuant to the
Plan will be evidenced by an Option Agreement or Award Agreement (the
"Agreement"). The Agreement will not be a precondition to the granting of
options or stock or other awards; however, no person will have any rights
under any option or stock or other awards granted under the Plan unless and
until the optionee to whom such option or stock or other award has been
granted has executed and delivered to MasTec an Agreement. The Board will
prescribe the form of all Agreements. A fully executed original of the
Agreement will be provided to both MasTec and the optionee.
4. Compliance with Rule 16b-3. It is the intent of MasTec that this Plan
and options, stock and other awards hereunder satisfy, and be interpreted
in a manner that, in the case of employees who have been granted an option
or awarded stock under the Plan ("Participants") who are or may be
Insiders, satisfies the applicable requirements of Rule 16b-3 of the
Exchange Act, so that such persons will be entitled to the benefits of Rule
16b-3, or other exemptive rules under Section 16, and will not be subjected
to avoidable liability thereunder. If any provision of this Plan or of any
option, stock or other award would otherwise frustrate or conflict with the
intent expressed in this Section 4, that provision to the extent possible
will be interpreted and deemed amended so as to avoid such conflict. To the
extent of any remaining irreconcilable conflict with such intent, such
provision will be deemed void as applicable to Insiders.
5. Shares of Stock Subject to the Plan. The total number of shares that may
be optioned or awarded under the Plan is 3,500,000 shares of the $0.10 par
value Common Stock of MasTec (the "Common Stock") of which 1,000,000 shares
may be awarded as restricted stock, subject to adjustment as provided in
Paragraph 5. No employee will receive, over the term of the Plan, awards in
the form of options, whether incentive stock options or options other than
incentive stock options, to purchase more than 1,000,000 shares of Common
Stock. Any shares subject to an option which for any reason expires or is
terminated unexercised and any restricted stock which is forfeited may
again be optioned or awarded under the Plan; provided, however, that
forfeited shares will not be available for further awards if the employee
has realized any benefits of ownership from such shares. Shares subject to
the Plan may be either authorized and unissued shares or issued shares
acquired by MasTec or its subsidiaries.
6. Eligibility. Key employees, including executives and managers, of MasTec
and its subsidiaries (but excluding non-employee directors) are eligible to
be granted options and awarded restricted stock under the Plan and to have
their bonuses payable in stock. The employees who will receive awards or
options under the Plan will be selected from time to time by the Board, in
its sole discretion, from among those eligible, which may be based upon
information furnished to the Board by MasTec's management, and the Board
will determine, in its sole discretion, the number of shares to be covered
by the award or awards and by the option or options granted to each such
employee selected.
7. Duration of the Plan. No award or option may be granted under the Plan
after January 31, 2004, but awards or options theretofore granted may
extend beyond that date.
<PAGE>
8. Terms and Conditions of Stock Options. All options granted under this
Plan will be either incentive stock options, as defined in Section 422 of
the Code, or options other than incentive stock options. Each such option
will be subject to all the applicable provisions of the Plan, including the
following terms and conditions, and to such other terms and conditions not
inconsistent with the Plan as the Board may determine.
(a) The option price per share will be determined by the Board.
However, subject to Paragraph 8(k), the option price of incentive
stock options will not be less than 100% of the fair market value of a
share of Common Stock at the time the option is granted. For purposes
of the Plan, the fair market value will be the mean between the
highest and lowest sale prices at which the Common Stock is traded on
the New York Stock Exchange on the relevant date. If no sales are
available on such date, the most recent date, within a reasonable
time, on which sales are available will be used. If the Common Stock
is listed on a national securities exchange other than the New York
Stock Exchange, the mean between the highest and lowest sale prices at
which the Common Stock is traded on such exchange on such date will be
used. If there is no sale of the Common Stock on such exchange on the
date the option is granted, the mean between the bid and asked prices
on such exchange at the close of the market on such date will be
deemed to be the fair market value of the Common Stock. If the Common
Stock is quoted in the over-the-counter market on the relevant date,
the fair market value will be the mean between the highest and lowest
sale prices at which the Common Stock is quoted in the
over-the-counter market on the relevant date as reported on NASDAQ.
(b) Each incentive stock option will be exercisable during and over
such period ending not later than 10 years, or such later date as may
be allowable under the Code, from the date it was granted, as may be
determined by the Board and stated in the Agreement. Each other option
will be exercisable during and over such period as may be determined
by the Board and stated in the Agreement.
(c) An option will not be exercisable with respect to a fractional share
of Common Stock or with respect to the lesser of fifty (50) shares or
the full number of shares then subject to the option. No fractional
shares of Common Stock will be issued upon the exercise of an option.
If a fractional share of Common Stock will become subject to an option
by reason of a stock dividend or otherwise, the optionee will not be
entitled to exercise the option with respect to such fractional share.
(d) Each option will state whether it will or will not be treated as an
incentive stock option.
(e) Each option may be exercised by giving written notice to MasTec
specifying the number of shares to be purchased, which will be
accompanied by payment in full including applicable taxes, if any.
Payment, except as provided in the Agreement, will be
(A) in United States dollars by check or bank draft, or
(B) by tendering to MasTec Common Stock shares already owned by the
person exercising the option, which may include shares received
as the result of a prior exercise of the option, and having a
fair market value, as determined in Paragraph 8(a), on the date
on which the option is exercised equal to the cash exercise price
applicable to such option.
(C) by a combination of United States dollars and Common Stock shares
as aforesaid, or
(D) in accordance with a cashless exercise program under which, if so
instructed by the optionee, shares of Common Stock may be issued
directly to the optionee's broker or dealer upon receipt of the
purchase price in cash from the broker or dealer.
No optionee will have any rights to dividends or other rights of a
shareholder with respect to shares of Common Stock subject to his or her option
until he or she has given written notice of exercise of his or her option and
paid in full for such shares.
<PAGE>
(f) Notwithstanding the foregoing, the Board may, in its sole discretion,
grant to a grantee of an option the right (hereinafter referred to as
a "stock appreciation right") to elect, in the manner described below,
in lieu of exercising his or her option for all or a portion of the
shares of Common Stock covered by such option, to relinquish his or
her option with respect to any or all of such shares and to receive
from MasTec a payment having a value equal to the amount by which (a)
the fair market value, as determined in Paragraph 8(a), of a share of
Common Stock on the date of such election, multiplied by the number of
shares as to which the grantee will have made such election, exceeds
(b) the total purchase price for that number of shares of Common Stock
under the terms of such option. A grantee who makes such an election
will receive payment in the sole discretion of the Board (i) in cash
equal to such excess; or (ii) in the nearest whole number of shares of
Common Stock of MasTec having an aggregate value which is not greater
than the cash amount calculated in (i) above; or (iii) a combination
of (i) and (ii) above. A stock appreciation right may be exercised
only when the amount described in (a) above exceeds the amount
described in (b) above. An election to exercise stock appreciation
rights will be deemed to have been made on the day written notice of
such election, addressed to the Board (Attention: Corporate Secretary)
is received at MasTec's executive offices. An option or any portion
thereof with respect to which a grantee has elected to exercise the
stock appreciation rights described above will be surrendered to
MasTec and such option will thereafter remain exercisable according to
its terms only with respect to the number of shares as to which it
would otherwise be exercisable, less the number of shares with respect
to which stock appreciation rights have been exercised. The grant of a
stock appreciation right will be evidenced by such form of Agreement
as the Board may prescribe. The Agreement evidencing stock
appreciation rights will be personal and will provide that they will
not be transferable by the grantee otherwise than by will or the laws
of descent and distribution and that they will be exercisable, during
the lifetime of the grantee, only by him or her.
(g) An option may be exercised only if at all times during the period
beginning with the date of the granting of the option and ending on
the date of such exercise, the grantee was an employee of either
MasTec or of a subsidiary of MasTec or of another corporation referred
to in Section 421(a)(2) of the Code, except that if such continuous
employment is terminated by retirement under a retirement plan of
MasTec or a subsidiary, or because of death or permanent disability,
the option may be exercised within a period to be provided in the
Agreement with the grantee not to exceed one year after such
termination of continuous employment, but in no event later than the
termination date of the option. The Board may require medical evidence
of permanent disability, including medical examinations by physicians
selected by it. Except as described in this Paragraph 8(g), unless
otherwise provided in the Agreement, all options granted to an
optionee and not previously exercised will terminate upon termination
of employment.
(h) The option by its terms will be personal and will not be transferable
by the optionee otherwise than by will or by the laws of descent and
distribution. During the lifetime of an optionee, the option will be
exercisable only by the optionee. In the event any option is exercised
by the executors, administrators, heirs or distributees of the estate
of a deceased optionee, MasTec will be under no obligation to issue
Common Stock unless and until MasTec is satisfied that the person or
persons exercising the option are the duly appointed legal
representative of the deceased optionee's estate or the proper
legatees or distributees.
(i) Notwithstanding any intent to grant incentive stock options, an option
granted will not be considered an incentive stock option to the extent
that it together with any earlier incentive stock options permits the
exercise for the first time in any calendar year of more than $100,000
in value of Common Stock (determined at the time of grant).
(j) The Board may, but need not, require such consideration from an
optionee at the time of granting an option as it will determine,
either in lieu of, or in addition to, the limitations on
exercisability provided in Paragraph 8(g).
(k) No incentive stock option will be granted to an employee who owns or
would own immediately before the grant of such option, directly or
indirectly, stock possessing more than 10% of the total combined
voting power of all classes of stock of MasTec. This restriction does
not apply if, at the time such incentive stock option is granted, the
option price is at least 110% of the fair market value of one share of
Common Stock, as determined in Paragraph 8(a), on the date of grant
and the incentive stock option by its terms is not exercisable after
the expiration of five years from the date of grant.
9. Terms and Conditions of Restricted Stock Awards. All awards of restricted
stock under the Plan will be subject to all the applicable provisions of
the Plan, including the following terms and conditions, and to such other
terms and conditions not inconsistent therewith, as the Board may
determine.
(a) Awards of restricted stock may be in addition to or in lieu of option
grants.
(b) During a period set by the Board at the time of each award of
restricted stock (the "restriction period"), the recipient will not be
permitted to sell, transfer, pledge, or assign the shares of
restricted stock; except that such shares may be used, if the award
permits, to pay the option price of any option granted under the Plan
provided an equal number of shares delivered to the optionee carry the
same restrictions as the shares so used.
(c) Shares of restricted stock will become free of all restrictions if the
recipient dies or his employment terminates by reason of permanent
disability, as determined by the Board, during the restriction period
and, to the extent set by the Board at the time of the award or later,
if the recipient retires under a retirement plan of MasTec or a
subsidiary during such period. The Board may require medical evidence
of permanent disability, including medical examinations by physicians
selected by it. If the Board determines that any such recipient is not
permanently disabled or that a retiree's restricted stock is not to
become free of restrictions, the restricted stock held by either such
recipient, as the case may be, will be forfeited and revert to MasTec.
(d) Shares of restricted stock will be forfeited and revert to MasTec upon
the recipient's termination of employment during the restriction
period for any reason other than death, permanent disability or, to
the extent determined by the Board, retirement under a retirement plan
of MasTec or a subsidiary, except to the extent the Board, in its sole
discretion, finds that such forfeiture might not be in the best
interest of MasTec and, therefore, waives all or part of the
application of this provision to the restricted stock held by such
recipient.
(e) Stock certificates for restricted stock will be registered in the name
of the recipient but will be appropriately legended and returned to
MasTec by the recipient, together with a stock power, endorsed in
blank by the recipient. The recipient will be entitled to vote shares
of restricted stock and will be entitled to all dividends paid
thereon, except that dividends paid in Common Stock or other property
will also be subject to the same restrictions.
(f) Restricted stock will become free of the foregoing restrictions upon
expiration of the applicable restriction period and MasTec will
deliver Common Stock certificates evidencing such stock free of any
restrictive legend.
10. Bonuses Payable in Stock. In lieu of cash bonuses otherwise payable under
MasTec's compensation plans or practices to employees eligible to
participate in the Plan, the Board, in its sole discretion, may determine
that such bonuses may be payable in stock or partly in stock and partly in
cash. Such bonuses will be in consideration of services previously
performed and as an incentive toward future services and may consist of
shares of Common Stock with or without restriction on future sale. The
number of shares of Common Stock payable in lieu of an amount of each bonus
otherwise payable will be determined by dividing such amount by the fair
market value of one share of Common Stock on a date determined by the
Board, with fair market value determined as of such date in accordance with
Paragraph 8(a).
<PAGE>
11. Change in Control.
(a) In the event of a change in control of MasTec, in addition to any
action required or authorized by the terms of an Agreement, the Board may, in
its sole discretion, take any of the following actions as a result, or in
anticipation, of any such event to assure fair and equitable treatment of
Participants:
(i) accelerate time periods for purposes of vesting in, or realizing
gain from, any outstanding option or shares of restricted stock
made pursuant to this Plan;
(ii) offer to purchase any outstanding option or shares of restricted
stock made pursuant to this Plan from the holder for its
equivalent cash value, as determined by the Board as of the date
of the change in control; or
(iii)make adjustments or modifications to outstanding options or with
respect to restricted stock as the Board deems appropriate to
maintain and protect the rights and interests of the Participants
following such change in control.
Any such action will be conclusive and binding on MasTec and all Participants.
(b) For purposes of this Section 11, a "change in control" will be deemed
to have occurred if at any time:
(1) there is consummated
(i) any consolidation or merger of MasTec in which MasTec is not
the continuing or surviving corporation or pursuant to which
any shares of Common Stock are to be converted into cash,
securities or other property, provided that the
consolidation or merger is not with a corporation which was
a wholly-owned subsidiary of MasTec immediately before the
consolidation or merger; or
(ii) any sale, lease, exchange or other transfer (in one
transaction or a series of related transactions) of all, or
substantially all, of the assets of MasTec; or
(2) the shareholders of MasTec approve any plan or proposal for the
liquidation or dissolution of MasTec; or
(3) any "person," including a "group" as determined in accordance
with Sections 13(d) and 14(d) of the Exchange Act, becomes the
beneficial owner (within the meaning of Rule 13d-3 under the
Exchange Act), directly or indirectly, of 33% or more of the
combined voting power of MasTec's then outstanding Common Stock,
provided that such person, immediately before it becomes such 33%
beneficial owner, is not (i) a wholly-owned subsidiary of MasTec,
(ii) an individual, or a spouse or a child of such individual,
that on March 1, 1994, owned greater than 20% of the combined
voting power of such Common Stock, or (iii) a trust, foundation,
partnership or other entity controlled by an individual or
individuals described in Paragraph 11(b)(3)(ii); or
(4) individuals who constitute the Board on March 1, 1994 (the
"Incumbent Board"), cease for any reason to constitute at least a
majority thereof, provided that any person becoming a director
subsequent to March 1, 1994, whose election, or nomination for
election by MasTec's shareholders, was approved by a vote of at
least three quarters of the directors comprising the Incumbent
Board (either by a specific vote or by approval of the proxy
statement of MasTec in which such person is named as a nominee
for director, without objection to such nomination) will be, for
purposes of this clause (4), considered as though such Person
were a member of the Incumbent Board.
(c) In no event, however, may any incentive stock option be exercised
after 10 years from the date it was granted.
<PAGE>
12. Transfer, Leave of Absence. For the purpose of the Plan: (a) a transfer of
an employee from MasTec to a subsidiary or affiliate of MasTec, whether or
not incorporated, or vice versa, or from one subsidiary or affiliate of
MasTec to another, and (b) a leave of absence, duly authorized in writing
by MasTec or a subsidiary or affiliate of MasTec, will not be deemed a
termination of employment.
13. Rights of Employees.
(a) No person will have any rights or claims under the Plan except in
accordance with the provisions of the Plan and any agreement.
(b) Nothing contained in the Plan will be deemed to give any employee the
right to be retained in the service of MasTec or its subsidiaries.
14. Tax Withholding Obligations.
(a) The payment of taxes, if any, upon the exercise of an option pursuant
to Paragraph 8(e) or a stock appreciation right pursuant to Paragraph
8(f), will be in cash at the time of exercise or on the applicable tax
date under Section 83 of the Code, if later; provided, however, tax
withholding obligations may be met by the withholding of Common Stock
otherwise deliverable to the optionee pursuant to procedures approved
by the Board.
(b) Recipients of restricted stock pursuant to paragraph 9 will be
required to pay taxes to MasTec upon the expiration of restriction
periods or such earlier dates as elected pursuant to Section 83 of the
Code; provided, however, tax withholding obligations may be met by the
withholding of Common Stock otherwise deliverable to the recipient
pursuant to procedures approved by the Board. In no event will Common
Stock be delivered to any awardee until he has paid to MasTec in cash
the amount of tax required to be withheld by MasTec or has elected to
have his withholding obligations met by the withholding of Common
stock in accordance with the procedures approved by the Board or
otherwise entered into an agreement satisfactory to MasTec providing
for payment of withholding tax.
(c) MasTec will withhold from any cash bonus described in Paragraph 10, an
amount of cash sufficient to meet its tax withholding obligations.
15. Changes in Capital. Upon changes in the outstanding Common Stock by reason
of a stock dividend, stock split, reverse split, subdivision,
recapitalization, merger, consolidation (whether or not MasTec is a
surviving corporation), an extraordinary dividend payable in cash or
property, combination or exchange of shares, separation, reorganization or
liquidation, the aggregate number and class of shares available under the
Plan as to which stock options and restricted stock may be awarded, the
number and class of shares under each option and the option price per share
will be correspondingly adjusted by the Board, such adjustments to be made
in the case of outstanding options without change in the total price
applicable to such options.
16. Miscellaneous Provisions.
(a) The Plan will be unfunded. MasTec will not be required to establish
any special or separate fund or to make any other segregation of
assets to assure the issuance of shares upon exercise of any option
under the Plan and issuance of shares upon exercise of options will be
subordinate to the claims of MasTec's general creditors. Proceeds from
the sale of shares of Common Stock pursuant to options granted under
this Plan will constitute general funds of MasTec. The expenses of the
Plan will be borne by MasTec.
(b) It is understood that the Board may, at any time and from time to time
after the granting of an option or the award of restricted stock or
bonuses payable in Common Stock hereunder, specify such additional
terms, conditions and restrictions with respect to such option or
stock as may be deemed necessary or appropriate to ensure compliance
with any and all applicable laws, including, but not limited to,
terms, restrictions and conditions for compliance with federal and
state securities laws and methods of withholding or providing for the
payment of required taxes.
(c) If at any time the Board will determine, in its discretion, that the
listing, registration or qualification of shares of Common Stock upon
any national securities exchange or under any state or federal law, or
the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with, the
sale or purchase of shares of Common Stock hereunder, no option or
stock appreciation right may be exercised or restricted stock or stock
bonus may be transferred in whole or in part unless and until such
listing, registration, qualification, consent or approval will have
been effected or obtained, or otherwise provided for, free of any
conditions not acceptable to the Board in the exercise of its
reasonable judgment.
(d) By accepting any benefit under the Plan, each Participant and each
person claiming under or through such person will be conclusively
deemed to have indicated his acceptance and ratification, and consent
to, any action taken under the Plan by the Board MasTec or the Board.
(e) The Plan will be governed by and construed in accordance with the laws
of the State of Florida.
17. Limits of Liability.
(a) Any liability of MasTec or a subsidiary of MasTec to any Participant
with respect to an option or stock or other award will be based solely
upon contractual obligations created by the Plan and the Agreement.
(b) Neither MasTec nor a subsidiary of MasTec, nor any member of the
Board, nor any other person participating in any determination of any
question under the Plan, or in the interpretation, administration or
application of the Plan, will have any liability to any party for any
action taken or not taken in connection with the Plan, except as may
expressly be provided by statute.
18. Amendments. The Board may amend, alter or discontinue the Plan, at any
time, including without limitation amendments necessary to qualify for an
exemption or to comply with applicable law or regulations, provided,
however, no amendment, alteration or discontinuation will be made which
would impair the rights of any holder of an award of restricted stock or
option or stock bonus theretofore granted, without his or her written
consent, or which, without the approval of MasTec"s shareholders, would:
(a) except as is provided in Paragraph 15, increase the maximum number of
shares of Common Stock reserved for the purpose of the Plan;
(b) except as is provided in Paragraphs 8(f) and 15 of the Plan, decrease
the option price of an incentive stock option to less than 100% of the
fair market value, as determined in Paragraph 8(a), of a share of
Common Stock on the date of the granting of the option;
(c) change the class of persons eligible to receive an award of restricted
stock or options under the Plan; or
(d) extend the duration of the Plan.
The Board may amend the terms of any award of restricted stock or option
theretofore granted, retroactively or prospectively, but no such amendment will
impair the rights of any holder without his or her written consent.
19. Duration. The Plan will terminate upon the earlier of the following dates
or events to occur:
(a) upon the adoption of a resolution of the Board terminating the Plan;
or
(b) January 31, 2004.
No such termination of the Plan will affect the rights of any Participant
hereunder and all options previously granted and restricted stock and stock
bonus awarded hereunder will continue in force and in operation after the
termination of the Plan, except as they may be otherwise terminated in
accordance with the terms of the Plan.
