Note 11 – Stock-Based Compensation and Other Employee Benefit Plans

The Company has certain stock-based compensation plans, under which stock options and restricted share awards are available for issuance or outstanding. Under stock-based compensation plans in effect as of June 30, 2014, there were a total of 6,226,093 shares available for grant or issuance.

Restricted Share Awards

MasTec grants restricted share awards, which are valued based on the market price of MasTec common stock on the date of grant. Total unearned compensation related to restricted share awards as of June 30, 2014 was approximately $19.9 million, which is expected to be recognized over a weighted average period of approximately 1.3 years. The total intrinsic value, or fair value, of restricted share awards that vested, which is based on the market price on the date of vesting, was $0.2 million and $0.4 million for the three month periods ended June 30, 2014 and 2013, respectively, and $6.0 million and $1.1 million for the six month periods ended June 30, 2014 and 2013, respectively.



Activity, restricted share awards:	Restricted Shares		Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2013	1,123,545		$	23.78
Granted	315,614		41.36
Vested	(145,560	)	19.82
Canceled/forfeited	(13,450	)	16.05
Non-vested restricted shares, as of June 30, 2014	1,280,149		$	28.64

Stock Options

The Company has granted options to purchase its common stock to employees and members of the Board of Directors and affiliates under various stock option plans at not less than the fair market value of the underlying stock on the date of grant. All outstanding stock options are fully vested.



Activity, stock options:	Stock Options		Per Share Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value ^(a) (in millions)
Options outstanding as of December 31, 2013	495,571		$	11.17	1.96	$	10.7
Exercised	(210,900	)	9.97
Canceled/forfeited	—		—
Options outstanding as of June 30, 2014	284,671		$	12.06	1.79	$	5.3
Options exercisable as of June 30, 2014	284,671		$	12.06	1.79	$	5.3


(a)	Amount represents the difference between the exercise price and the market price of the Company’s stock on the last trading day of the corresponding period, multiplied by the number of in-the-money options.

The total intrinsic value of options exercised during the three month periods ended June 30, 2014 and 2013, which is based on the difference between the exercise price and the market price of the Company’s stock at the date of exercise, was $0.2 million and $2.2 million, respectively. The total intrinsic value of options exercised during the six month periods ended June 30, 2014 and 2013 was $6.5 million and $5.7 million, respectively. Proceeds from options exercised during the three month periods ended June 30, 2014 and 2013 totaled $0.1 million and $1.5 million, respectively, and totaled $0.8 million and $3.4 million for the six month periods ended June 30, 2014 and 2013, respectively.

Employee Stock Purchase Plans

The Company's employee stock purchase plans allow qualified employees to purchase MasTec, Inc. common stock at 85% of the fair market value of the common stock at the lower of (i) the date of commencement of the offering period or (ii) the last day of the exercise period, as defined in the plan documents. The fair value of purchases under the Company's employee stock purchase plans is estimated using the Black-Scholes option-pricing valuation model.



	Six Months Ended June 30,
Activity, employee stock purchase plan:	2014		2013
Cash proceeds (in millions)	$	1.7	$	5.5
Common shares issued	62,102		416,397
Weighted average price per share	$	26.90	$	13.10
Weighted average grant date fair value per share	$	6.39	$	5.49

Stock-Based Compensation Expense and Tax Benefits

Details of stock-based compensation expense, which is included within general and administrative expense in the condensed unaudited consolidated statement of operations, and related tax benefits for the periods indicated are as follows (in millions):



	Three Months Ended June 30,				Six Months Ended June 30,
	2014		2013		2014		2013
Stock-based compensation expense	$	4.2	$	4.3	$	7.5	$	6.6
Income Tax Effects:
Income tax benefit from stock-based compensation	$	1.8	$	1.8	$	6.6	$	3.3
Excess tax benefit from stock-based compensation ^(a)	$	0.1	$	0.8	$	3.4	$	1.5


(a)	Excess tax benefits, which represent cash flows from tax deductions in excess of the recorded tax effect of compensation expense recognized for stock options exercised and vested restricted shares, are classified as financing cash flows in the Company’s condensed unaudited consolidated statements of cash flows.