Stock-Based Compensation and Other Employee Benefit Plans

9 Months Ended

Sep. 30, 2021

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation and Other Employee Benefit Plans

The Company has stock-based compensation plans, under which shares of the Company’s common stock are reserved for issuance, including the MasTec, Inc. Amended and Restated 2013 Incentive Compensation Plan (the “Restated 2013 Incentive Plan”), which became effective in May 2021, and which amends and restates the MasTec, Inc. 2013 Incentive Compensation Plan (as amended from time to time, the “2013 Incentive Plan”). The Restated 2013 Incentive Plan increases the total number of shares of MasTec, Inc. common stock reserved and available for delivery pursuant to awards under the Restated 2013 Incentive Plan by 1,150,000 shares. Under all stock-based compensation plans in effect as of September 30, 2021, there were approximately 3,673,000 shares available for future grant.

Non-cash stock-based compensation expense under all plans totaled $6.1 million and $5.6 million for the three month periods ended September 30, 2021 and 2020, respectively, and totaled $17.7 million and $15.5 million for the nine month periods ended September 30, 2021 and 2020, respectively. Income tax benefits associated with stock-based compensation arrangements, including from the vesting of share-based payment awards, totaled $1.2 million and $1.4 million for the three month periods ended September 30, 2021 and 2020, respectively, and totaled $3.4 million and $3.6 million for the nine month periods ended September 30, 2021 and 2020, respectively.

Restricted Shares

MasTec grants restricted stock awards and restricted stock units (together, “restricted shares”) to eligible participants, which are valued based on the closing market share price of MasTec common stock (the “market price”) on the date of grant. During the restriction period, holders of restricted stock awards are entitled to vote the shares. As of September 30, 2021, total unearned compensation related to restricted shares was approximately $34.5 million, which amount is expected to be recognized over a weighted average period of approximately 1.9 years. The fair value of restricted shares that vested, which is based on the market price on the date of vesting, totaled $0.3 million and $0.2 million for the three month periods ended September 30, 2021 and 2020, respectively, and totaled $11.6 million and $6.7 million for the nine month periods ended September 30, 2021 and 2020, respectively.


Activity, restricted shares: (a)	Restricted Shares	Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2020	1,845,341	$	34.90
Granted	160,221	93.58
Vested	(118,263)	52.58
Canceled/forfeited	(26,000)	31.72
Non-vested restricted shares, as of September 30, 2021	1,861,299	$	38.88

(a) Includes 2,500 and 2,300 restricted stock units as of September 30, 2021 and December 31, 2020, respectively.

Employee Stock Purchase Plans

The Company has certain employee stock purchase plans (collectively, “ESPPs”), under which shares of the Company’s common stock are available for purchase by eligible participants. Effective January 1, 2021, the Company’s ESPPs were amended (the “Amended ESPPs”), eliminating the look-back option and changing the offering period from three months to two weeks. Under the Amended ESPPs, eligible participants are permitted to purchase MasTec, Inc. common stock at 85% of the fair market value of the shares on the date of purchase, which occurs on the last trading day of each two week offering period. Previously, these plans allowed participants to purchase MasTec, Inc. common stock at 85% of the fair market value of the shares at the lower of (i) the date of commencement of the offering period or (ii) the last day of the offering period, as defined in the plan documents. Prior to January 1, 2021, the fair value of purchases under the ESPPs was estimated using the Black-Scholes option-pricing valuation model. The Company may issue common shares to plan participants or reacquire common shares on the open market or in privately negotiated transactions, at the Company’s discretion.

For the three and nine month periods ended September 30, 2021, 21,636 shares and 60,669 shares, respectively, were purchased by participants under the Company’s ESPPs for $1.8 million and $5.0 million, respectively, which shares were reacquired by the Company on the open market. For the three and nine month periods ended September 30, 2020, 39,596 shares and 193,655 shares, respectively, were purchased by participants for $1.5 million and $5.5 million, respectively, which shares were newly issued by the Company. Compensation expense associated with the Company’s ESPPs totaled approximately $0.3 million and $0.5 million for the three month periods ended September 30, 2021 and 2020, respectively, and totaled approximately $0.9 million and $1.7 million for the nine month periods ended September 30, 2021 and 2020, respectively.