Stock-Based Compensation and Other Employee Benefit Plans

9 Months Ended

Sep. 30, 2023

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation and Other Employee Benefit Plans

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. Under all stock-based compensation plans in effect as of September 30, 2023, there were approximately 2,752,000 shares available for future grant. Non-cash stock-based compensation expense under all plans totaled $7.2 million and $5.7 million for the three month periods ended September 30, 2023 and 2022, respectively, and totaled $24.3 million and $18.9 million for the nine month periods ended September 30, 2023 and 2022, respectively.

Income tax benefits associated with stock-based compensation arrangements totaled $1.1 million and $0.9 million for the three month periods ended September 30, 2023 and 2022, respectively. For the nine month periods ended September 30, 2023 and 2022, such income tax benefits totaled $12.9 million and $4.3 million, respectively, including net tax benefits related to the vesting of share-based payment awards totaling $8.8 million and $0.9 million, 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, 2023, total unearned compensation related to restricted shares was approximately $49.1 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 approximately $0.3 million for both the three month periods ended September 30, 2023 and 2022, and totaled approximately $78.3 million and $19.5 million for the nine month periods ended September 30, 2023 and 2022, respectively.

Activity, restricted shares: (a)	Restricted Shares	Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2022	2,049,280	$	52.33
Granted	204,215	95.99
Vested	(855,196)	27.89
Canceled/forfeited	(67,959)	46.86
Non-vested restricted shares, as of September 30, 2023	1,330,340	$	75.03

(a)    Includes 1,000 and 2,150 restricted stock units as of September 30, 2023 and December 31, 2022, 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. Under the 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. At the Company’s discretion, share purchases may be satisfied by delivering either newly issued common shares, or common shares reacquired on the open market or in privately negotiated transactions.

For the three month periods ended September 30, 2023 and 2022, 22,824 shares and 25,495 shares, respectively, were purchased by participants under the Company’s ESPPs for $1.9 million and $1.7 million, respectively, and for the nine month periods ended September 30, 2023 and 2022, 69,475 shares and 82,121 shares, respectively, were purchased for $5.7 million and $5.3 million, respectively. Shares purchased by participants under the Company’s ESPPs in each of the three and nine month periods ended September 30, 2023 and 2022 were reacquired by the Company on the open market. Compensation expense associated with the Company’s ESPPs totaled approximately $0.3 million for both the three month periods ended September 30, 2023 and 2022, and totaled approximately $1.0 million for both the nine month periods ended September 30, 2023 and 2022.