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

The Company has 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 September 30, 2014, there were a total of 6,193,235 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 September 30, 2014 was approximately $16.0 million, which is expected to be recognized over a weighted average period of approximately 1.1 years. The intrinsic value, or fair value, of restricted share awards that vested, which is based on the market price on the date of vesting, totaled $1.1 million and $0.9 million for the three month periods ended September 30, 2014 and 2013, respectively, and totaled $7.1 million and $2.0 million for the nine month periods ended September 30, 2014 and 2013, respectively.



Activity, restricted share awards:	Restricted Shares		Per Share Weighted Average Grant Date Fair Value
Non-vested restricted shares, as of December 31, 2013	1,123,545		$	23.78
Granted	323,249		41.05
Vested	(181,195	)	20.26
Canceled/forfeited	(22,442	)	17.38
Non-vested restricted shares, as of September 30, 2014	1,243,157		$	28.90

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. 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 September 30, 2014	284,671		$	12.06	1.54	$	5.3
Options exercisable as of September 30, 2014	284,671		$	12.06	1.54	$	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 was based on the difference between the exercise price and the market price of the Company’s stock on the date of exercise. During the three month period ended September 30, 2014, there were no options exercised. For the three month period ended September 30, 2013, the intrinsic value of options exercised totaled $4.6 million. The total intrinsic value of options exercised during the nine month periods ended September 30, 2014 and 2013 totaled $6.5 million and $10.4 million, respectively. Proceeds from options exercised during the three month period ended September 30, 2013 totaled $0.4 million. Proceeds from options exercised during the nine month periods ended September 30, 2014 and 2013 totaled $0.8 million and $3.8 million, respectively.

Employee Stock Purchase Plans

The Company's employee stock purchase plans allow qualified employees to purchase MasTec common stock at 85% of its fair market value 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.



	Nine Months Ended September 30,
Activity, employee stock purchase plan:	2014		2013
Cash proceeds (in millions)	$	2.5	$	6.0
Common shares issued	94,761		436,925
Weighted average per share price	$	26.60	$	13.69
Weighted average per share grant date fair value	$	6.34	$	5.55

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 for the periods indicated are as follows (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2014		2013		2014		2013
Stock-based compensation expense	$	4.1	$	3.0	$	11.6	$	9.6
Income Tax Effects:
Income tax benefit from stock-based compensation	$	1.8	$	4.5	$	8.4	$	7.7
Excess tax benefit from stock-based compensation ^(a)	$	0.1	$	3.0	$	3.5	$	4.4


(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.