View:
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2001
Commission File Number 001-08106
MASTEC, INC.
(Exact name of registrant as specified in its charter)
Florida 65-0829355
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3155 N.W. 77th Avenue, Miami, FL 33122-1205
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (305) 599-
1800
Former name, former address and former fiscal year, if changed
since last report: Not Applicable
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
As of May 14, 2001 MasTec, Inc. had 47,786,793 shares of common
stock, $0.10 par value, outstanding.
MASTEC, INC.
TABLE OF CONTENTS
Part I. Financial Information
Item 1. Financial Statements
Unaudited Consolidated Statements of Operations
For the Three Months Ended March 31, 2001 and
March 31, 2000. . . . . . . . . . . . . . . . . 3
Consolidated Balance Sheets as of March 31,
2001 (Unaudited)and December 31, 2000 . . . . . 4
Unaudited Consolidated Statement of Changes in
Shareholders' Equity for the Three Months
Ended March 31, 2001. . . . . . . . . . . . . . 5
Unaudited Consolidated Statements of Cash Flows
for the Three Months Ended March 31, 2001 and
March 31, 2000. . . . . . . . . . . . . . . . . 6
Notes to Consolidated Financial Statements
Unaudited). . . . . . . . . . . . . . . . . . . 8
Item 2. Management's Discussion and Analysis of Results
of Operations and Financial Condition . . . . .11
Item 3. Quantitative and Qualitative Disclosures About
Market Risk . . . . . . . . . . . . . . . . . .15
Part II. Other Information
Item 6. Exhibits and Reports on Form 8-K. . . . . . . .15
Signatures. . . . . . . . . . . . . . . . . . . . . . . .16
MASTEC, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended
March 31,
--------------------------
2001 2000
---------- ----------
Revenue:
North America $ 323,809 $ 262,372
International 13,403 10,322
---------- ---------
337,212 272,694
Costs of revenue 265,358 208,929
Depreciation 13,318 13,478
Amortization 2,876 3,501
General and administrative
Expenses 47,914 23,112
Interest expense 4,712 5,556
Interest income 2,433 1,213
Other income, net 441 380
---------- ---------
Income before provision for
income taxes and minority
interest 5,908 19,711
Provision for income taxes 2,474 8,379
Minority interest (137) 145
Net income $ 3,297 $ 11,477
Basic weighted average common
shares outstanding 47,712 43,805
Basic earnings per share $ .07 $ 0.26
Diluted weighted average common
shares outstanding 49,007 45,852
Diluted earnings per share $ .07 $ 0.25
The accompanying notes are an integral part of these
consolidated financial statements.
MASTEC, INC.
CONSOLIDATED BALANCE SHEET
(In thousands)
March 31, December 31,
2001 2000
--------- ------------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 14,620 $ 18,457
Accounts receivable, unbilled
revenue and retainage, net 380,914 392,585
Inventories 19,654 19,643
Other current assets 17,822 23,079
-------- ---------
Total current assets 433,010 453,764
Property and equipment, net 160,343 159,673
Intangibles, net 262,343 262,398
Other assets 101,233 89,044
--------- ---------
Total assets $ 956,929 $ 964,879
Liabilities and Shareholders' Equity
Current liabilities:
Current maturities of debt $ 6,792 $ 5,685
Accounts payable 68,400 85,797
Other current liabilities 96,197 128,379
--------- ---------
Total current liabilities 171,389 219,861
--------- ---------
Other liabilities 38,762 38,530
--------- ---------
Long-term debt 244,166 206,160
--------- ---------
Commitments and contingencies (Note 4)
Shareholders' equity:
Common stock 4,773 4,770
Capital surplus 346,513 346,099
Retained earnings 169,647 166,350
Foreign currency translation
adjustments (18,321) (16,891)
--------- ---------
Total shareholders' equity 502,612 500,328
--------- ---------
Total liabilities and
shareholders' equity $ 56,929 $ 964,879
========= =========
The accompanying notes are an integral part of these
consolidated financial statements.
MASTEC, INC.
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
(In thousands)
(Unaudited)
Foreign
Common Stock Currency
--------------- Capital Retained Translation
Shares Amount Surplus Earnings Adjustments Total
------ ------- --------- --------- -------------------
Balance December 31, 2000 47,702 $ 4,770 $ 346,099 $ 166,350 $(16,891) $500,328
Net income 3,297 3,297
Foreign currency translation
adjustment (1,430) (1,430)
Stock issued 24 3 414 417
------ ------- --------- ---------- --------- ---------
Balance March 31, 47,726 $ 4,773 $ 346,513 $ 169,647 $(18,321) $502,612
====== ======= ========= ========== ========= =========
The accompanying notes are an integral part of these consolidated financial
statements.
MASTEC, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Three Months Ended
March 31,
---------------------
2001 2000
--------- ----------
Cash flows from operating activities:
Net income $ 3,297 $ 11,477
Adjustments to reconcile net income
to net cash used in operating
activities:
Depreciation and amortization 16,194 16,979
Minority interest 137 (145)
(Gain) loss on sale of assets (241) 3
Changes in assets and liabilities
net of effect of acquisitions:
Accounts receivables, unbilled
revenue and retainage, net 5,650 (12,951)
Inventories 200 (491)
Other assets, current and non-
current portion 1,359 (2,594)
Accounts payable (17,303) (8,798)
Other current liabilities (25,322) (21,481)
Other liabilities (7,945) (2,590)
-------- ---------
Net cash used in operating activities (23,974) (20,591)
-------- ---------
Cash flows from investing activities:
Capital expenditures (12,574) (13,749)
Cash paid for acquisitions and
contingent consideration, (net of
cash acquired) (2,649) (2,109)
Repayment of notes receivable, net - 946
Investment in unconsolidated companies
held and distribution to joint
venture partner (2,200) (7,983)
Proceeds from assets held for sale 276 13,401
-------- ---------
Net cash used in investing activities (17,147) (9,494)
-------- ---------
Cash flows from financing activities:
Borrowings (repayments) on revolving
credit facilities, net 37,492 (74,416)
Net proceeds from common stock
Issued 417 130,604
-------- ---------
Net cash provided by financing activities 37,909 56,188
-------- ---------
Net (decrease) increase in cash and
cash equivalents (3,212) 26,103
Effect of translation on cash (625) 532
Cash and cash equivalents - beginning
of period 18,457 27,635
-------- ---------
Cash and cash equivalents - end of period $ 14,620 $ 54,270
The accompanying notes are an integral part of these
consolidated financial statements.
MASTEC, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
(In thousands)
(Unaudited)
Supplemental disclosure of non-cash investing and financing
activities:
During the three months ended March 31, 2001, we completed
certain acquisitions which have been accounted for as purchases.
The fair value of the net assets excluding goodwill acquired
totaled $1.9 million and was comprised primarily of $2.6 million
of accounts receivable, $1.7 million of property and equipment,
$0.4 million of other assets and $0.2 million in cash, offset by
$3.0 million of assumed liabilities. The excess of the purchase
price over the fair value of net assets acquired was $2.4
million and was allocated to goodwill. The total purchase price
of $4.3 million is comprised of $2.6, paid in cash and the
balance in seller financing.
During the three months ended March 31, 2000, we paid
approximately $2.1 million related to contingent consideration
from earlier acquisitions which was recorded as additional
goodwill.
The accompanying notes are an integral part of these
consolidated financial statements.
MASTEC, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - Basis for Presentation of Consolidated Financial
Statements
The accompanying unaudited consolidated financial
statements of MasTec, Inc. have been prepared in accordance with
generally accepted accounting principles for interim financial
information and with the instructions for Form 10-Q and Rule 10-
01 of Regulation S-X. They do not include all information and
notes required by generally accepted accounting principles for
complete financial statements and should be read together with
the audited financial statements and notes thereto included in
our annual report on Form 10-K for the year ended December 31,
2000. The balance sheet data as of December 31, 2000 was derived
from audited financial statements but does not include all
disclosures required by generally accepted accounting principles.
Certain reclassifications have been made to conform to the 2001
presentation. The financial information furnished reflects all
adjustments, consisting only of normal recurring accruals, which
are, in the opinion of management, necessary for a fair
presentation of the financial position, results of operations
and cash flows for the quarterly periods presented. The results
of operations for the periods presented are not necessarily
indicative of our future results of operations for the entire
year.
Our comprehensive income for the three months ended March
31, 2001 and 2000 was $1.9 million and $11.9 million,
respectively. The components of comprehensive income are net
income and foreign currency translation adjustments.
Note 2 - Debt
Debt is comprised of the following (in thousands):
March 31, December 31,
2001 2000
Revolving credit facility at LIBOR plus
1.0% (6.08% at March 31, 2001 and
7.64% at December 31, 2000) $ 44,000 $ 7,000
Other bank facilities at LIBOR plus 1.50%
(6.58% at March 31, 2001 and 8.06% at
December 31, 2000) 1,497 517
Notes payable for equipment, at interest
rates from 7.5% to 8.5% due in
installments through the year 2004 6,266 6,161
Notes payable for acquisitions, at interest
rates from 7.0% to 8.0% due in
installments through November 2001 3,384 2,362
7.75% senior subordinated notes due
February 2008 195,811 195,805
--------- ---------
Total debt 250,958 211,845
Less current maturities (6,792) (5,685)
--------- ---------
Long-term debt $ 244,166 $206,160
========= =========
We have a credit facility that provides for borrowings up
to an aggregate of $100 million. Amounts outstanding under the
revolving credit facility mature on June 9, 2002. We are
required to pay an unused facility fee ranging from .25% to .50%
per annum on the facility, depending upon certain financial
covenants. The credit facility is secured by a pledge of shares
of certain of our subsidiaries. Interest under the credit
facility accrues at rates based, at our option, on the agent
bank's base rate plus a margin of up to .50% depending on
certain financial covenants or 1% above the overnight federal
funds effective rate, whichever is higher, or its LIBOR Rate (as
defined in the credit facility) plus a margin of 1.00% to 2.25%,
depending on certain financial covenants.
The credit facility and the senior subordinated notes
contain customary events of default and covenants which
prohibit, among other things, making investments in excess of a
specified amount, incurring additional indebtedness in excess of
a specified amount, paying dividends in excess of a specified
amount, making capital expenditures in excess of a specified
amount, creating liens, prepaying other indebtedness, including
the senior notes, and engaging in certain mergers or
combinations without the prior written consent of the lenders.
The credit facility also provides that we must maintain certain
financial ratio coverages, requiring, among other things minimum
ratios at the end of each fiscal quarter of debt to earnings and
earnings to interest expense.
Note 3 - Operations by Segments and Geographic Areas
The following table sets forth, for the three months ended
March 31, 2001 and 2000, certain information about segment
results of operations and segment assets (in thousands):
Datacom Energy
Three Months Network Network International
2001 Services Services (1) Other (2) Consolidated
- -------------------------------------------------------------------------------------------------
Revenue $ 287,792 $ 36,017 $ 13,403 $ - $ 337,212
Depreciation 11,280 1,711 - 327 13,318
Amortization 2,169 202 222 283 2,876
Income (loss) before provision
for income taxes and minority
interest 10,867 2,914 112 (7,985) 5,908
Capital expenditures 9,543 964 - 2,067 12,574
Total assets 717,013 77,929 64,306 97,681 956,929
Datacom Energy
Three Months Network Network International
2000 Services Services (1) Other (2) Consolidated
- -------------------------------------------------------------------------------------------------
Revenue $ 225,009 $ 37,363 $ 10,322 $ - $ 272,694
Depreciation 10,088 2,941 - 449 13,478
Amortization 1,270 202 2,029 - 3,501
Income (loss) before provision
for income taxes and minority
interest 27,057 2,283 (1,010) (8,619) 19,711
Capital expenditures 12,861 555 333 - 13,749
Total assets 468,957 83,048 121,224 87,060 760,289
(1) For the three months ended March 31, 2001 and 2000, consists of our Brazilian operations. As
of March 31, 2001 and 2000, total assets for Brazil consisted of $43.0 million and $47.9 million,
respectively and the remainder relates to our interest in international assets not related to our
core business.
(2) Consists of non-core construction and corporate operations, which includes interest expense net
of interest income of $2.3 million and $4.3 million for 2001 and 2000, respectively.
There are no significant transfers between geographic areas and
segments. Total assets are those assets used in our operations
in each segment. Corporate assets include domestic cash and
cash equivalents, non-core assets held for sale and notes
receivable.
Note 4 - Commitments and Contingencies
We have filed lawsuits in Florida state court against a
subsidiary of Artcom Technologies, Inc., a holding company
for a Spanish infrastructure provider that we formerly owned,
to recover more than $5.0 million due under a promissory note
and for breach of contract. We are also pursuing other claims
against Artcom affiliates totaling approximately $4.0
million. Artcom has responded by suing us in federal court in
Florida to recover approximately $6.0 million (subject to
trebling) it alleges we received as a result of certain
allegedly unauthorized transactions by two former employees
of Artcom that occurred after we sold the company.
In January 2001, we filed suit in Florida state court
against Broward County, Florida, to recover approximately
$5.0 million for work performed to construct a detention
facility for the Broward Sheriff's Office ("BSO"). The BSO has
filed a separate lawsuit in response to our lawsuit claiming
$13.0 million in damages for alleged delays in constructing the
facility.
In November 1997, we filed a suit against Miami-Dade
County in Florida state court alleging breach of contract and
seeking damages exceeding $3.0 million in connection with the
county's refusal to pay amounts due to us under a multi-year
agreement to perform road restoration work for the Miami-Dade
Water and Sewer Department ("MWSD"), a department of the
county. The county has counterclaimed against us seeking
unspecified damages.
We are a party to other pending legal proceedings arising
in the normal course of business, none of which we believe is
material to our financial position or results of operations.
Our operations in Brazil are subject to the risks of
political, economic or social instability, including the
possibility of expropriation, confiscatory taxation, hyper-
inflation or other adverse regulatory or legislative
developments, or limitations on the repatriation of investment
income, capital and other assets. We cannot predict whether any
of such factors will occur in the future or the extent to which
such factors would have a material adverse effect on our
Brazilian operations.
Note 5 - Receivables
From time to time, in exchange for one or more of long-term
exclusive infrastructure services agreements, interest,
financing and other fees, and warrants or other equity interests
in the client, we may grant to our clients payment terms
typically for six to eighteen months. At March 31, 2001, we had
$38.9 million under these arrangements.
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
Except for historical information, the matters discussed
below are forward looking statements made pursuant to the safe
harbor provisions for forward-looking statements described in
the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on our current expectations
and are subject to a number of risks, uncertainties and
assumptions relating to our operations, financial condition and
results of operations. Should one or more of these risks or
uncertainties materialize, or should the underlying assumptions
prove incorrect, actual results may differ significantly from
results expressed or implied in any forward-looking statements
made by us in this Quarterly Report. These and other risks are
detailed in documents filed by us with the Securities and
Exchange Commission, including our registration statement on
Form S-3 (No. 333-90027). We are not obligated to revise these
forward-looking statements to reflect future events or
circumstances.
General
We are a leading end-to-end voice, video, data and energy
network infrastructure solution for a broad range of
communications, broadband, energy and other corporate clients.
We have a diverse client base representing all the major
segments of the industries we serve. Our broad suite of
services allows our clients to connect with their customers. We
design, build, install, maintain and monitor internal and
external networks, transmission facilities and data storage
centers supporting e-commerce and other communications,
computing and energy systems. We are a national services
provider, operating from 200 service locations throughout the
United States and Canada. We also operate in Brazil through a
51% owned joint venture.
Results of Operations
The following tables state for the periods indicated our
consolidated operations in dollar and percentage of revenue
terms for 2000 and 2001 (dollars in thousands):
Three Months Ended March 31,
--------------------------------------------------
2001 2000
-------------------- ---------------------
Revenue $ 337,212 100.0% $ 272,694 100.0%
Costs of revenue 265,358 78.7 208,929 76.6
Depreciation 13,318 3.9 13,478 4.9
Amortization 2,876 0.9 3,501 1.3
General and administrative expenses 47,914 14.2 23,112 8.4
Interest expense, net of
interest income 2,279 0.7 4,343 1.6
Other income 441 0.1 380 -
---------- ------ --------- ------
Income before provision for income
taxes, and minority interest 5,908 1.7 19,711 7.2
Provision for income taxes 2,474 0.7 8,379 3.0
Minority interest (137) - 145 -
---------- ------ --------- ------
Net income $ 3,297 1.0% $ 11,477 4.2%
========== ====== ========= ======
The following table sets forth the revenue and change in
revenue by North American operating segments, in dollar and
percentage terms (in thousands):
Three Months Ended
March 31, Change
------------------ ---------------
2001 2000 $ %
-------- -------- --------- -----
Datacom network services $287,792 $225,009 $ 62,783 27.9%
Energy network services 36,017 37,363 (1,346) (3.6)
International 13,403 10,322 3,081 29.8
-------- -------- --------- -----
$337,212 $272,694 $ 64,518 23.7%
======== ======== =========
Our revenue was $337.2 million for the three months ended
March 31, 2001, compared to $272.7 million for the same period
in 2000, representing an increase of $64.5 million or 23.7%. We
experienced growth in our datacom network services segment
primarily due to the increased demand for bandwidth by end-users
which has spurred network construction and upgrades by our
clients. Revenue generated by our energy network services
segment decreased slightly as we continue to position the unit
for improved profitability in the future.
Our costs of revenue were $265.4 million or 78.7% of
revenue for the three months ended March 31, 2001, compared to
$208.9 million or 76.6% of revenue for the same period in 2000.
In 2001, margins were impacted by the rapid deceleration of
anticipated demand for our switching and central office services
in our network services division, adverse weather and reduced
margins in our international operations.
Depreciation was $13.3 million or 3.9% of revenue for the
three months ended March 31, 2001, compared to $13.5 million or
4.9% of revenue for the same period in 2000. The decline in
depreciation as a percentage of revenue in 2001 was due to our
ability to more efficiently utilize our equipment.
Amortization was $2.9 million or 0.9% of revenue for the
three months ended March 31, 2001, compared to $3.5 million or
1.3% of revenue for the same period in 2000. Decrease of $0.6
million is due primarily to an acceleration of amortization
related to our international operations during 2000.
Amortization of goodwill net of tax was $0.04 million in 2001
and $0.05 million in 2000 which includes the acceleration in
2000.
General and administrative expenses were $47.9 million or
14.2% of revenue for the three months ended March 31, 2001,
compared to $23.1 million or 8.5% of revenue for the same period
in 2000. Included in general and administrative expense in 2001
is a provision of $22.0 million related to a reserve for a
portion of receivables due from clients who have filed for
Chapter 11 bankruptcy reorganization recently or who have
experienced difficulties in raising funding due to current
economic conditions. Excluding the reserve, general and
administrative expenses were 7.7% of revenue. The decline in
general and administrative expenses as a percentage of revenue
in 2001, excluding the provision for bad debt, was due primarily
to our ability to continue to support higher revenue with a
comparatively lower administrative base.
Interest expense, net of interest income, was $2.3 million
or 0.7% of revenue for the three months ended March 31, 2001,
compared to $4.3 million or 1.6% of revenue for the same period
in 2000. The decrease in net interest expense of $2.0 million
was due primarily to lower average outstanding debt under our
revolving credit facility and greater interest income in 2001
when compared to 2000.
For the three months ended March 31, 2001, our effective
tax rate was approximately 40.3% for North American operations
and 33% for Brazilian operations, compared to 42.0% and 33.0% in
2000 for North American and Brazilian operations, respectively.
Financial Condition, Liquidity and Capital Resources
Our primary liquidity needs are for working capital,
capital expenditures, acquisitions and investments, and debt
service. Our primary sources of liquidity are cash flows from
operations and borrowings under revolving lines of credit.
Net cash used in operating activities was $24.0 million for
the three months ended March 31, 2001, compared to $20.6 million
for the same period in 2000. Net cash used in operating
activities in 2001 and 2000 was due principally to increased
working capital needs as a result of growth in revenue and
changes in client mix. From time to time, in exchange for one or
more of long-term exclusive infrastructure services agreements,
interest, financing and other fees, and warrants or other equity
interests in the client, we may grant to our clients payment
terms typically for six to eighteen months. At March 31, 2001,
we had $38.9 million under these arrangements.
We have a credit facility that provides for borrowings up
to an aggregate of $100.0 million. Amounts outstanding under the
credit facility mature on June 9, 2002. We are required to pay
an unused facility fee ranging from .25% to .50% annually on the
facility, depending upon certain financial covenants. The credit
facility contains customary events of default and covenants
which prohibit, among other things, making investments in excess
of a specified amount, incurring additional indebtedness in
excess of a specified amount, paying dividends in excess of a
specified amount, making capital expenditures in excess of a
specified amount, creating liens, prepaying other indebtedness,
including our 7.75% senior subordinated notes, and engaging in
certain mergers or combinations without the prior written
consent of the lenders. The credit facility also provides that
we must maintain financial ratio coverages at the end of each
fiscal quarter such as debt to earnings and earnings to interest
expense.
We also have $200 million, 7.75% senior subordinated notes
due in February 2008, with interest due semi-annually.
During 2001, we invested $10.6 million primarily in our
fleet to support revenue growth and $2.0 million in technology
investments. We also invested $4.8 million in acquisitions and
investments. We have reflected in other current liabilities
additional consideration by reason of earnouts with respect to
prior years' acquisitions of an aggregate of approximately $35.0
million that we expect will be paid predominately during 2001.
Seasonality
Our North America operations have historically been
seasonally slower in the first quarter of the year. During the
last two years, we have generally experienced sequential
increases in revenue following the first quarter of every year.
This seasonality is primarily the result of client budgetary
constraints and preferences and the effect of winter weather on
external network activities. Some of our U.S. clients,
particularly the incumbent local exchange carriers, tend to
complete budgeted capital expenditures before the end of the
year and defer additional expenditures until the following
budget year. Revenue in local currency from our Brazilian
operations is not expected to fluctuate seasonally.
Impact of Inflation
The primary inflationary factor affecting our operations is
increased labor costs. We have not experienced significant
increases in labor costs to date. Competition for qualified
personnel could increase labor costs for us in the future. Our
Brazilian operations may, at times in the future, be exposed to
high inflation or currency devaluations.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
See Note 2 to Consolidated Financial Statements for
disclosure about market risk.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
10.1 Employment agreement with Austin Shanfelter dated as
of January 1, 2001.
10.2 Employment agreement with Carmen Sabater as of January
1, 2001.
10.3 Employment agreement with Jose Sariego as of January
1, 2001.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed
on its behalf by the undersigned thereunto duly authorized.
MASTEC, INC.
Date: May 15, 2001 /s/ CARMEN M. SABATER
Carmen M. Sabater
Executive Vice President - Chief
Financial Officer
(Principal Financial Officer)
Date: May 15, 2001 /s/ ARLENE VARGAS
Arlene Vargas
Vice President and Controller
(Principal Accounting Officer)
EMPLOYMENT AGREEMENT
AGREEMENT effective as of January 1, 2001 between MASTEC,
INC. (the "Company") and AUSTIN SHANFELTER (the "Executive").
In consideration of the mutual covenants and obligations set
forth in this Agreement, the parties agree as follows:
1. The Company hereby employs the Executive and the Executive
hereby accepts such employment as Senior Vice President and Chief
Operating Officer of the Company and its subsidiaries, upon the
terms and conditions set forth in this Agreement. The Executive
will report to the Board of Directors of the Company or its
designee and to the Chief Executive Officer of the Company. The
Executive will have such responsibilities and perform such duties
as the Board of Directors of the Company or its designee assigns
to the Executive, commensurate with his position as Senior Vice
President and Chief Operating Officer of the Company.
2. The Executive's employment will be for a term commencing on
January 1, 2001 and ending on the close of business December 31,
2002 (the "Employment Term"). The Employment Term may be extended
by mutual agreement of the parties.
3. During the Employment Term, the Executive will devote the
Executive's full working time, attention and energies to the
business of the Company and its subsidiaries, except that the
Company acknowledges that the Executive may continue to devote a
reasonable amount of his time to serving on the board of directors
of charitable or non-profit organizations so long as such
activities do not unreasonably interfere with the discharge of his
duties for the Company. The Executive will be employed by the
Company at the Company's office in Fort Myers, Florida, and will
travel to such other locations as may be necessary to discharge
his duties. The Company will maintain an office at the Company's
facility in Fort Myers, Florida, and will provide secretarial and
other support personnel for the Executive, in each case
commensurate with the Executive's status as Senior Vice President
and Chief Operating Officer of the Company. The Company will not
request or require the Executive to be employed at another
location without the Executive's consent.
4. The Company will pay to the Executive as compensation for
services rendered during the Employment Term a salary of not less
than $325,000.00 per annum for the year ending December 31, 2001;
the salary for the year ending December 31, 2002 will be
determined by the Compensation Committee of the Board of Directors
of the Company but will not be less than the prior year's salary
(the amount described in this Section 4 for each year, the
"Salary"). The Salary will be paid in accordance with the
Company's normal payroll practices and will be subject to
withholding of taxes and other deductions required by law.
5. The Company and the Executive will agree on a bonus plan for
calendar year 2001 and 2002 as soon as possible after the close of
the preceding calendar year, which bonus plan will be at least as
favorable to the Executive as the 2000 Senior Management Incentive
Compensation Plan. The Board of Directors of the Company may, on
its own initiative and in its sole discretion, award cash or other
bonuses to the Executive, whether or not any of the performance
thresholds in the bonus plan are achieved by the Company or the
Executive.
6. The Company may terminate the employment of the Executive
under this Agreement at any time with or without "Cause" (as
defined below), subject to the other terms and conditions of this
Agreement, by giving the Executive five (5) business days' prior
written notice of termination. In addition to any other
compensation or benefits payable to the Executive under this
Agreement, the Executive upon a termination of employment will
receive all amounts due to the Executive under the Company's
401(k) retirement plan, deferred compensation plan, split dollar
insurance policy or any other benefit plan of the Company in which
the Executive participates. The Executive also will be entitled to
elect continuation of health benefits under COBRA.
7. In the event of (a) a "Change of Control" (as defined below)
or (b) a termination of employment (including as a result of death
or "Disability," as defined below) prior to the expiration of the
Employment Term other than for Cause (each of (a) and (b) a
"Triggering Event"), the Company will pay in cash to the
Executive, immediately upon the effective date of the Triggering
Event and in lieu of all other compensation under this Agreement,
(i) any unpaid portion of the Salary in respect of the remainder
of the Employment Term, (ii) a bonus equal to the greater of (1)
the aggregate of all bonuses under any bonus plans agreed to by
the Company and Executive for 2001 and 2002 that would have been
earned if the Executive was employed for the full performance
period under the bonus plans, to the extent such bonuses have not
already been earned and paid or (2) (x) $2,000,000.00 if the
Triggering Event occurs on or after January 1, 2001 and prior to
January 1, 2002, and (y) $1,000,000.00 if the Triggering Event
occurs on or after January 1, 2002. In addition, upon the
occurrence of a Triggering Event, all of the Executive's stock
options or restricted stock awards under the Company's 1994 Stock
Incentive Plan, 1999 Non-Qualified Employee Stock Option Plan or
any other option or benefit plan will immediately upon the
effective date of the Triggering Event (A) in the case of options,
become fully vested and immediately exercisable and may be
exercised by Executive for the full remaining term of the options,
and (B) in the case of restricted stock, all restrictions on the
stock will lapse and the stock may be freely sold without further
restriction except as required by applicable law.
8. If any payment or benefits under this Agreement become subject
to the excise tax imposed by Section 4999 of the Internal Revenue
Code of 1986, as amended (the "Code"), or any substitute provision
of the Code, or any interest or penalties are incurred by
Executive with respect to such excise tax (collectively, the
"Excise Tax"), then the Company will pay Executive an additional
amount or amounts (the "Gross-up Payment") such that the net
amount or amounts retained by Executive, after deduction of any
Excise Tax on any of the payments or benefits under this Agreement
and any federal, state and local income tax and Excise Tax on the
Gross-up Payment, will equal the amount of such payment or
benefits prior to the imposition of such Excise Tax. For purposes
of determining the amount of a Gross-up Payment, Executive will be
deemed to pay federal income taxes at the highest marginal rate of
federal income taxation in the calendar year in which the Gross-up
Payment is payable and state and local income taxes at the highest
marginal rate of taxation in the state and locality of Executive's
residence on the date the Gross-up Payment is payable, net of the
maximum reduction in federal income taxes that could be obtained
from any available deduction of such state and local taxes.
a. The Company will pay each Gross-up Payment on the date on
which Executive becomes entitled to the payment or benefits giving
rise to the Excise Tax. If the amount of the Excise Tax is later
determined to be less than the amount taken into account in
calculating the Gross-up Payment, Executive will repay to the
Company (to the extent actually paid by the Company) the portion
of the Gross-up Payment attributable to the overstated amount of
Excise Tax at the time such reduction is finally determined, plus
interest at the rate set forth in Section 1274(b)(2)(B) of the
Code. If the amount of the Excise Tax is later determined to be
more than the amount taken into account in calculating the Gross-
up Payment, the Company will pay Executive an additional Gross-up
Payment in respect of the additional amount of Excise Tax at the
time the amount of the additional tax is finally determined.
9. In the event of a termination of employment for Cause, the
Company will pay in cash to the Executive any accrued and unpaid
Salary to the date of termination. The Executive will not be
entitled to any bonus under any bonus plan or under paragraph 7 of
this Agreement, or to any other compensation from the Company, and
all unvested stock options or restricted stock as to which the
restriction has not lapsed owned by the Executive will terminate
upon the effective date of termination of employment.
Notwithstanding any other provisions of this Agreement, in no
event will the Company cause a termination of employment for Cause
without at least forty-five (45) days' notice to the Executive and
approval of such termination for Cause by the entire Board of
Directors of the Company.
10. The Company will pay for or reimburse the Executive, in
accordance with its practice for executive officers of the
Company, all reasonable and necessary expenses and other
disbursements incurred by the Executive for or on behalf of the
Company in the performance of his duties hereunder. The Executive
will provide such appropriate documentation of expenses and
disbursements as may from time to time be reasonably requested by
the Company.
11. The Company will (a) indemnify and hold the Executive
harmless for any claims, demands, damages, liabilities, losses,
costs and expenses (including attorneys' and paralegal fees and
court costs) incurred or suffered by the Executive in connection
with the Executive's performance of his duties under this
Agreement or otherwise on behalf of the Company or its affiliates
to the fullest extent (including advancement of expenses)
permitted by Florida corporate law for the indemnification of
officers and directors of a Florida corporation, and (b) will
include the Executive as a covered employee under the Company's
directors' and officers' liability insurance policy and employment
practices liability insurance policy.
12. The Executive (and his family) will be entitled to
participate in all of the Company's group health, dental and
disability plans, and other benefit plans for executives of the
Company. The Executive will receive any and all other benefits
accorded by the Company to executive officers of the Company.
13. The parties acknowledge that the provisions of this Agreement
are highly confidential and that disclosure of this Agreement or
its terms would be extremely prejudicial to the other party.
Accordingly, neither party will disclose the terms of this
Agreement to any other person or entity other than third party
advisors with a need to know (such as legal or tax advisors) and
other than when required by law, without the prior written consent
of the other party.
14. The Executive acknowledges that as a result of his employment
with the Company, the Executive will gain knowledge of, and will
have access to, proprietary and confidential information and trade
secrets of the Company and its affiliates. Therefore, Executive
agrees that he will not, in any fashion, form or manner, directly
or indirectly (i) use, disclose, communicate or provide or permit
access to any person or entity, or (ii) remove from the premises
of the Company or any of its affiliates any notes or records
(including copies or facsimiles, whether made by electronic,
electrical, magnetic, optical, laser acoustic or other means),
relating to any confidential, proprietary or secret information of
the Company or any of its affiliates (collectively, "Confidential
Information") (including without limitation (1) the identity of
customers, suppliers, subcontractors and others with whom they do
business; (2) their marketing methods, strategies and related
information; (3) contract terms, pricing, margin or cost
information or other information regarding the relationship
between them and the persons and entities with which they have
contracted; (4) their services, products, software, technology,
developments, improvements and methods of operation; (5) their
results of operations, financial condition, projected financial
performance, sales and profit performance and financial
requirements; (6) the identity of and compensation paid to their
employees and consultants; (7) any business plans, models or
strategies and the information contained therein; (8) their
sources, leads or methods of obtaining new business; and (9) all
other confidential information of, about or concerning the
business of the Company and its affiliates), except for (x)
information that is or becomes available to the public generally
other than as a result of an unauthorized disclosure by the
Executive, including as an example publicly-available information
filed by the Company with the Securities and Exchange Commission
or other governmental or regulatory authorities, (y) information
that is generally known in the business of the Company or its
affiliates or that constitutes standard industry practices,
customs and methods, or (z) information known to the Executive
prior to joining the Company or its predecessors or gained during
his employment with the Company from sources outside of the
Company or its employees, officers, directors, consultants,
advisors or other representatives. The Executive will be entitled
to use Confidential Information in the discharge of his duties to
the Company.
15. In consideration of the compensation and benefits paid to
Executive under this Agreement, Executive agrees that during the
Employment Term and, in the case of a termination of this
Agreement for Cause, for two (2) years after the termination (the
"Non-Competition Period"), Executive will not within the United
States of America or the Commonwealth of Canada:
a. directly or indirectly own, manage, operate, control, be
employed by, consult with or participate in the ownership,
management, operation or control of, or be connected in any manner
with, any business of the type and character engaged in and
competitive with the business of the Company or any of its
affiliates, as it exists now or in the future. For these
purposes, ownership of securities of 1% or less of any class of
securities of a public company will not be considered to be
competition with the Company;
b. solicit, persuade or attempt to solicit or persuade any
existing customer or any client or potential customer or client to
which the Company or any of its affiliates has made a presentation
or with which any of them has been having discussions to cease
doing business with or decrease the amount of business done with
or not to hire the Company or any of its affiliates or to commence
doing business with or increase the amount of business done with
or hire another person or entity;
c. solicit, persuade or attempt to solicit or persuade any
individual who is an employee of the Company or any of its
affiliates to leave their employ or to become employed by any
other person or entity.
It is the desire and intent of the parties to this Agreement that
the provisions of Sections 14 and 15 will be enforced to the
fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. If
any particular provisions or portion of Sections 14 or 15 is
adjudicated invalid or unenforceable, this section will be deemed
amended to delete any provision or portion adjudicated to be
invalid or unenforceable, the amendment to apply only with respect
to the operation of that section in the particular jurisdiction in
which the adjudication is made. The parties recognize that the
performance by Executive of his obligations under Sections 14 and
15 are special, unique and extraordinary in character, and that if
Executive breaches or threatens to breach the terms and conditions
of this Agreement, the Company may suffer irreparable injury for
which no adequate remedy at law may exist. Accordingly, in the
event of such breach or threatened breach, the Company will be
entitled, if it so elects, to institute and prosecute proceedings
in any court of competent jurisdiction, either in law or in
equity, to obtain damages for any breach of this Agreement, to
enforce the specific performance of this Agreement by Executive,
or to enjoin Executive from breaching or attempting to breach this
Agreement.
16. THE COMPANY AND EXECUTIVE KNOWINGLY, VOLUNTARILY,
IRREVOCABLY, UNCONDITIONALLY AND INTENTIONALLY WAIVE THE RIGHT TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THIS
AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PERSON OR
PARTY AND RELATED TO THIS AGREEMENT; THIS IRREVOCABLE WAIVER OF
THE RIGHT TO A JURY TRIAL BEING A MATERIAL INDUCEMENT FOR THE
COMPANY AND EXECUTIVE TO ENTER INTO THIS AGREEMENT.
17. Any notice, demand, consent, agreement, request, or other
communication required or permitted under this Agreement must be
in writing and must be, (i) mailed by first-class United States
mail, registered or certified, return receipt requested, proper
postage prepaid, or (ii) delivered personally by independent
courier (such as FedEx, DHL or similar nationally-recognized
courier), to the parties at the addresses as follows (or at such
other addresses as shall be specified by the parties by like
notice):
if to the Company, to:
MasTec, Inc.
3155 N.W. 77th Avenue
Miami, FL 33122-1205
Attention: Legal Department
if to the Executive, to:
Austin Shanfelter
14170 Jetport Loop
Fort Myers, FL 33193
Each party may on five (5) days' prior notice in the manner
set forth in this Section designate by notice in writing a new
address to which any notice, demand, consent, agreement, request
or communication may thereafter be given, served or sent. Each
notice, demand, consent, agreement, request or communication which
is mailed or hand delivered in the manner described above will be
deemed received for all purposes at such time as it is delivered
to the addressee (with the return receipt or the courier delivery
receipt being deemed conclusive evidence of such delivery) or at
such time as delivery is refused by the addressee upon
presentation.
18. This Agreement: (a) may be executed in counterparts, and all
counterparts will collectively constitute a single agreement, (b)
may not be amended or modified or any provision waived except in
writing, (c) constitutes the entire agreement of the parties and
supersedes all prior agreements or understandings, (d) is binding
upon and inures to the benefit of the parties and their respective
heirs, personal representatives, beneficiaries, joint tenants,
successors and assigns (whether by merger, consolidation, transfer
of all or substantially all assets, or otherwise), and (e) may not
be assigned or the duties delegated without the consent of all
parties except as expressly set forth in this Agreement.
19. This Agreement, the rights and obligations of the parties,
and any claims or disputes relating in any way thereto will be
governed by and construed in accordance with the laws of the State
of Florida, without giving effect to any choice or conflict of law
provision or rule (whether in the State of Florida or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Florida. Each of the
Executive and the Company, by executing this Agreement, (a)
irrevocably submits to the exclusive jurisdiction of any federal
or Florida state court sitting in Miami-Dade County, Florida in
respect of any suit, action or proceeding arising out of or
relating in any way to this Agreement, and irrevocably accepts for
itself and in respect of its property, generally and
unconditionally, the jurisdiction of such courts and to be bound
by any judgment rendered in such courts; (b) waives, to the
fullest extent it may do so effectively under applicable law, any
objection it may have to the laying of the venue of any such suit,
action or proceeding brought in any such court and any claim that
any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum; and (c) irrevocably
consents, to the fullest extent it may do so effectively under
applicable law, to the service of process of any of the
aforementioned courts in any such suit, action or proceeding by
the mailing of copies thereof by registered or certified mail,
postage prepaid, to the Executive or the Company at the address
set forth in this Agreement, such service to become effective five
(5) business days (or such other period of time provided by
applicable law) after such mailing. In addition to any other
rights or remedies that either party may have under this Agreement
or under law, the prevailing party in any suit, action or
proceeding will be entitled to collect from the other party (a)
all of its attorneys' and paralegal fees and other costs and
expenses incurred by the prevailing party (b) interest on any
amount not paid when due at a rate per annum equal to eighteen
percent (18%) or the maximum amount permitted by law.
20. The following definitions will apply for purposes of this
Agreement:
"Cause" means (i) Executive being convicted of any felony
(whether or not against the Company or its affiliates), (ii)
willful malfeasance in the performance of Executive's
responsibilities after ten (10) days' written notice to the
Executive and an opportunity to cure; (iii) any material act of
dishonesty by Executive against the Company or any of its
affiliates, (v) a material violation by Executive of any of the
policies or rules of the Company or any of its affiliates or (vi)
the voluntary resignation of Executive from employment with the
Company or any of its affiliates. The determination that Cause has
occurred must be made by unanimous vote of all the members of the
Board of Directors of the Company after forty five (45) days'
prior written notice to Executive and an opportunity to appear
before the Board and contest the determination of Cause.
"Disability" means the inability to perform the material
duties of Executive.
"Change of Control" means the occurrence of any of the
following events:
(a) any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant
to which 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 the Company immediately before the consolidation or
merger; or
(b) 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 the Company; or
(c) the shareholders of the Company approve any plan or
proposal for the liquidation or dissolution of the Company; or
(d) 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 the Company'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
the Company, (ii) an individual, or a spouse or a child of such
individual, that on January 1, 2001, owned greater than 20% of the
combined voting power of such Common Stock, or (iii) a trust,
foundation or other entity controlled by an individual or
individuals described in the preceding subsection; or
(e) individuals who constitute the Board on January 1, 2001
(the "Incumbent Board"), cease for any reason to constitute at
least a majority thereof, provided that any person becoming a
director subsequent to January 1, 2001, whose election, or
nomination for election by the Company'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 the Company in which such
person is named as a nominee for director, without objection to
such nomination) will be, for purposes of this clause, considered
as though such Person were a member of the Incumbent Board.
Notwithstanding the foregoing, Incumbent Directors may, by a
two-thirds vote of such Directors, declare a given transaction
will not constitute a Change in Control for purposes of the Plan.
EXECUTED as of the date first above written.
MASTEC, INC.
By: /s/ Joel Citron
-----------------------------
Joel Citron, President
EXECUTIVE
/s/ Austin Shanfelter
-----------------------------
Austin Shanfelter
EMPLOYMENT AGREEMENT
AGREEMENT effective as of January 1, 2001 between MASTEC,
INC. (the "Company") and CARMEN SABATER (the "Executive").
In consideration of the mutual covenants and obligations set
forth in this Agreement, the parties agree as follows:
1. The Company hereby employs the Executive and the Executive
hereby accepts such employment as Senior Vice President and Chief
Financial Officer of the Company and its subsidiaries, upon the
terms and conditions set forth in this Agreement. The Executive
will report to the Board of Directors of the Company or its
designee and to the Chief Executive Officer of the Company. The
Executive will have such responsibilities and perform such duties
as the Board of Directors of the Company or its designee assigns
to the Executive, commensurate with her position as Senior Vice
President and Chief Financial Officer of the Company.
2. The Executive's employment will be for a term commencing on
January 1, 2001 and ending on the close of business December 31,
2002 (the "Employment Term"). The Employment Term may be extended
by mutual agreement of the parties.
3. During the Employment Term, the Executive will devote the
Executive's full working time, attention and energies to the
business of the Company and its subsidiaries, except that the
Company acknowledges that the Executive may continue to devote a
reasonable amount of her time to serving on the board of directors
of charitable or non-profit organizations so long as such
activities do not unreasonably interfere with the discharge of her
duties for the Company. The Executive will be employed by the
Company at the Company's headquarters in Miami, Florida, and will
travel to such other locations as may be necessary to discharge
her duties. The Company will maintain an office at the Company's
headquarters facility in Miami, Florida, and will provide
secretarial and other support personnel for the Executive, in each
case commensurate with the Executive's status as Senior Vice
President and Chief Financial Officer of the Company. The Company
will not request or require the Executive to be employed at
another location without the Executive's consent.
4. The Company will pay to the Executive as compensation for
services rendered during the Employment Term a salary of not less
than $270,000.00 per annum for the year ending December 31, 2001;
the salary for the year ending December 31, 2002 will be
determined by the Compensation Committee of the Board of Directors
of the Company but will not be less than the prior year's salary
(the amount described in this Section 4 for each year, the
"Salary"). The Salary will be paid in accordance with the
Company's normal payroll practices and will be subject to
withholding of taxes and other deductions required by law.
5. The Company and the Executive will agree on a bonus plan for
calendar year 2001 and 2002 as soon as possible after the close of
the preceding calendar year, which bonus plan will be at least as
favorable to the Executive as the 2000 Senior Management Incentive
Compensation Plan. The Board of Directors of the Company may, on
its own initiative and in its sole discretion, award cash or other
bonuses to the Executive, whether or not any of the performance
thresholds in the bonus plan are achieved by the Company or the
Executive.
6. The Company may terminate the employment of the Executive
under this Agreement at any time with or without "Cause" (as
defined below), subject to the other terms and conditions of her
Agreement, by giving the Executive five (5) business days' prior
written notice of termination. In addition to any other
compensation or benefits payable to the Executive under this
Agreement, the Executive upon a termination of employment will
receive all amounts due to the Executive under the Company's
401(k) retirement plan, deferred compensation plan, split dollar
insurance policy or any other benefit plan of the Company in which
the Executive participates. The Executive also will be entitled to
elect continuation of health benefits under COBRA.
7. In the event of (a) a "Change of Control" (as defined below)
or (b) a termination of employment (including as a result of death
or "Disability," as defined below) prior to the expiration of the
Employment Term other than for Cause (each of (a) and (b) a
"Triggering Event"), the Company will pay in cash to the
Executive, immediately upon the effective date of the Triggering
Event and in lieu of all other compensation under this Agreement,
(i) any unpaid portion of the Salary in respect of the remainder
of the Employment Term, (ii) a bonus equal to the greater of (1)
the aggregate of all bonuses under any bonus plans agreed to by
the Company and Executive for 2001 and 2002 that would have been
earned if the Executive was employed for the full performance
period under the bonus plans, to the extent such bonuses have not
already been earned and paid or (2) $800,000.00. In addition, upon
the occurrence of a Triggering Event, all of the Executive's stock
options or restricted stock awards under the Company's 1994 Stock
Incentive Plan, 1999 Non-Qualified Employee Stock Option Plan or
any other option or benefit plan will immediately upon the
effective date of the Triggering Event (A) in the case of options,
become fully vested and immediately exercisable and may be
exercised by Executive for the full remaining term of the options,
and (B) in the case of restricted stock, all restrictions on the
stock will lapse and the stock may be freely sold without further
restriction except as required by applicable law.
8. If any payment or benefits under this Agreement become subject
to the excise tax imposed by Section 4999 of the Internal Revenue
Code of 1986, as amended (the "Code"), or any substitute provision
of the Code, or any interest or penalties are incurred by
Executive with respect to such excise tax (collectively, the
"Excise Tax"), then the Company will pay Executive an additional
amount or amounts (the "Gross-up Payment") such that the net
amount or amounts retained by Executive, after deduction of any
Excise Tax on any of the payments or benefits under this Agreement
and any federal, state and local income tax and Excise Tax on the
Gross-up Payment, will equal the amount of such payment or
benefits prior to the imposition of such Excise Tax. For purposes
of determining the amount of a Gross-up Payment, Executive will be
deemed to pay federal income taxes at the highest marginal rate of
federal income taxation in the calendar year in which the Gross-up
Payment is payable and state and local income taxes at the highest
marginal rate of taxation in the state and locality of Executive's
residence on the date the Gross-up Payment is payable, net of the
maximum reduction in federal income taxes that could be obtained
from any available deduction of such state and local taxes.
a. The Company will pay each Gross-up Payment on the date on
which Executive becomes entitled to the payment or benefits giving
rise to the Excise Tax. If the amount of the Excise Tax is later
determined to be less than the amount taken into account in
calculating the Gross-up Payment, Executive will repay to the
Company (to the extent actually paid by the Company) the portion
of the Gross-up Payment attributable to the overstated amount of
Excise Tax at the time such reduction is finally determined, plus
interest at the rate set forth in Section 1274(b)(2)(B) of the
Code. If the amount of the Excise Tax is later determined to be
more than the amount taken into account in calculating the Gross-
up Payment, the Company will pay Executive an additional Gross-up
Payment in respect of the additional amount of Excise Tax at the
time the amount of the additional tax is finally determined.
9. In the event of a termination of employment for Cause, the
Company will pay in cash to the Executive any accrued and unpaid
Salary to the date of termination. The Executive will not be
entitled to any bonus under any bonus plan or under paragraph 7 of
this Agreement, or to any other compensation from the Company, and
all unvested stock options or restricted stock as to which the
restriction has not lapsed owned by the Executive will terminate
upon the effective date of termination of employment.
Notwithstanding any other provisions of this Agreement, in no
event will the Company cause a termination of employment for Cause
without at least forty-five (45) days' notice to the Executive and
approval of such termination for Cause by the entire Board of
Directors of the Company.
10. The Company will pay for or reimburse the Executive, in
accordance with its practice for executive officers of the
Company, all reasonable and necessary expenses and other
disbursements incurred by the Executive for or on behalf of the
Company in the performance of her duties hereunder. The Executive
will provide such appropriate documentation of expenses and
disbursements as may from time to time be reasonably requested by
the Company.
11. The Company will (a) indemnify and hold the Executive
harmless for any claims, demands, damages, liabilities, losses,
costs and expenses (including attorneys' and paralegal fees and
court costs) incurred or suffered by the Executive in connection
with the Executive's performance of her duties under this
Agreement or otherwise on behalf of the Company or its affiliates
to the fullest extent (including advancement of expenses)
permitted by Florida corporate law for the indemnification of
officers and directors of a Florida corporation, and (b) will
include the Executive as a covered employee under the Company's
directors' and officers' liability insurance policy and employment
practices liability insurance policy.
12. The Executive (and her family) will be entitled to
participate in all of the Company's group health, dental and
disability plans, and other benefit plans for executives of the
Company. The Executive will receive any and all other benefits
accorded by the Company to executive officers of the Company.
13. The parties acknowledge that the provisions of this Agreement
are highly confidential and that disclosure of this Agreement or
its terms would be extremely prejudicial to the other party.
Accordingly, neither party will disclose the terms of this
Agreement to any other person or entity other than third party
advisors with a need to know (such as legal or tax advisors) and
other than when required by law, without the prior written consent
of the other party.
14. The Executive acknowledges that as a result of her employment
with the Company, the Executive will gain knowledge of, and will
have access to, proprietary and confidential information and trade
secrets of the Company and its affiliates. Therefore, Executive
agrees that she will not, in any fashion, form or manner, directly
or indirectly (i) use, disclose, communicate or provide or permit
access to any person or entity, or (ii) remove from the premises
of the Company or any of its affiliates any notes or records
(including copies or facsimiles, whether made by electronic,
electrical, magnetic, optical, laser acoustic or other means),
relating to any confidential, proprietary or secret information of
the Company or any of its affiliates (collectively, "Confidential
Information") (including without limitation (1) the identity of
customers, suppliers, subcontractors and others with whom they do
business; (2) their marketing methods, strategies and related
information; (3) contract terms, pricing, margin or cost
information or other information regarding the relationship
between them and the persons and entities with which they have
contracted; (4) their services, products, software, technology,
developments, improvements and methods of operation; (5) their
results of operations, financial condition, projected financial
performance, sales and profit performance and financial
requirements; (6) the identity of and compensation paid to their
employees and consultants; (7) any business plans, models or
strategies and the information contained therein; (8) their
sources, leads or methods of obtaining new business; and (9) all
other confidential information of, about or concerning the
business of the Company and its affiliates), except for (x)
information that is or becomes available to the public generally
other than as a result of an unauthorized disclosure by the
Executive, including as an example publicly-available information
filed by the Company with the Securities and Exchange Commission
or other governmental or regulatory authorities, (y) information
that is generally known in the business of the Company or its
affiliates or that constitutes standard industry practices,
customs and methods, or (z) information known to the Executive
prior to joining the Company or its predecessors or gained during
her employment with the Company from sources outside of the
Company or its employees, officers, directors, consultants,
advisors or other representatives. The Executive will be entitled
to use Confidential Information in the discharge of her duties to
the Company.
15. In consideration of the compensation and benefits paid to
Executive under this Agreement, Executive agrees that during the
Employment Term and, in the case of a termination of this
Agreement for Cause, for two (2) years after the termination (the
"Non-Competition Period"), Executive will not within the United
States of America or the Commonwealth of Canada:
a. directly or indirectly own, manage, operate, control, be
employed by, consult with or participate in the ownership,
management, operation or control of, or be connected in any manner
with, any business of the type and character engaged in and
competitive with the business of the Company or any of its
affiliates, as it exists now or in the future. For these
purposes, ownership of securities of 1% or less of any class of
securities of a public company will not be considered to be
competition with the Company;
b. solicit, persuade or attempt to solicit or persuade any
existing customer or any client or potential customer or client to
which the Company or any of its affiliates has made a presentation
or with which any of them has been having discussions to cease
doing business with or decrease the amount of business done with
or not to hire the Company or any of its affiliates or to commence
doing business with or increase the amount of business done with
or hire another person or entity;
c. solicit, persuade or attempt to solicit or persuade any
individual who is an employee of the Company or any of its
affiliates to leave their employ or to become employed by any
other person or entity.
It is the desire and intent of the parties to this Agreement
that the provisions of Sections 14 and 15 will be enforced to the
fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. If
any particular provisions or portion of Sections 14 or 15 is
adjudicated invalid or unenforceable, this section will be deemed
amended to delete any provision or portion adjudicated to be
invalid or unenforceable, the amendment to apply only with respect
to the operation of that section in the particular jurisdiction in
which the adjudication is made. The parties recognize that the
performance by Executive of his obligations under Sections 14 and
15 are special, unique and extraordinary in character, and that if
Executive breaches or threatens to breach the terms and conditions
of this Agreement, the Company may suffer irreparable injury for
which no adequate remedy at law may exist. Accordingly, in the
event of such breach or threatened breach, the Company will be
entitled, if it so elects, to institute and prosecute proceedings
in any court of competent jurisdiction, either in law or in
equity, to obtain damages for any breach of this Agreement, to
enforce the specific performance of this Agreement by Executive,
or to enjoin Executive from breaching or attempting to breach this
Agreement.
16. THE COMPANY AND EXECUTIVE KNOWINGLY, VOLUNTARILY,
IRREVOCABLY, UNCONDITIONALLY AND INTENTIONALLY WAIVE THE RIGHT TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THIS
AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PERSON OR
PARTY AND RELATED TO THIS AGREEMENT; THIS IRREVOCABLE WAIVER OF
THE RIGHT TO A JURY TRIAL BEING A MATERIAL INDUCEMENT FOR THE
COMPANY AND EXECUTIVE TO ENTER INTO THIS AGREEMENT.
17. Any notice, demand, consent, agreement, request, or other
communication required or permitted under this Agreement must be
in writing and must be, (i) mailed by first-class United States
mail, registered or certified, return receipt requested, proper
postage prepaid, or (ii) delivered personally by independent
courier (such as FedEx, DHL or similar nationally-recognized
courier), to the parties at the addresses as follows (or at such
other addresses as shall be specified by the parties by like
notice):
if to the Company, to:
MasTec, Inc.
3155 N.W. 77th Avenue
Miami, FL 33122-1205
Attention: Legal Department
if to the Executive, to:
Carmen Sabater
5762 SW 100 Street
Miami, Florida 33156
Each party may on five (5) days' prior notice in the manner
set forth in this Section designate by notice in writing a new
address to which any notice, demand, consent, agreement, request
or communication may thereafter be given, served or sent. Each
notice, demand, consent, agreement, request or communication which
is mailed or hand delivered in the manner described above will be
deemed received for all purposes at such time as it is delivered
to the addressee (with the return receipt or the courier delivery
receipt being deemed conclusive evidence of such delivery) or at
such time as delivery is refused by the addressee upon
presentation.
18. This Agreement: (a) may be executed in counterparts, and all
counterparts will collectively constitute a single agreement, (b)
may not be amended or modified or any provision waived except in
writing, (c) constitutes the entire agreement of the parties and
supersedes all prior agreements or understandings, (d) is binding
upon and inures to the benefit of the parties and their respective
heirs, personal representatives, beneficiaries, joint tenants,
successors and assigns (whether by merger, consolidation, transfer
of all or substantially all assets, or otherwise), and (e) may not
be assigned or the duties delegated without the consent of all
parties except as expressly set forth in this Agreement.
19. This Agreement, the rights and obligations of the parties,
and any claims or disputes relating in any way thereto will be
governed by and construed in accordance with the laws of the State
of Florida, without giving effect to any choice or conflict of law
provision or rule (whether in the State of Florida or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Florida. Each of the
Executive and the Company, by executing this Agreement, (a)
irrevocably submits to the exclusive jurisdiction of any federal
or Florida state court sitting in Miami-Dade County, Florida in
respect of any suit, action or proceeding arising out of or
relating in any way to this Agreement, and irrevocably accepts for
itself and in respect of its property, generally and
unconditionally, the jurisdiction of such courts and to be bound
by any judgment rendered in such courts; (b) waives, to the
fullest extent it may do so effectively under applicable law, any
objection it may have to the laying of the venue of any such suit,
action or proceeding brought in any such court and any claim that
any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum; and (c) irrevocably
consents, to the fullest extent it may do so effectively under
applicable law, to the service of process of any of the
aforementioned courts in any such suit, action or proceeding by
the mailing of copies thereof by registered or certified mail,
postage prepaid, to the Executive or the Company at the address
set forth in this Agreement, such service to become effective five
(5) business days (or such other period of time provided by
applicable law) after such mailing. In addition to any other
rights or remedies that either party may have under this Agreement
or under law, the prevailing party in any suit, action or
proceeding will be entitled to collect from the other party (a)
all of its attorneys' and paralegal fees and other costs and
expenses incurred by the prevailing party (b) interest on any
amount not paid when due at a rate per annum equal to eighteen
percent (18%) or the maximum amount permitted by law.
20. The following definitions will apply for purposes of this
Agreement:
"Cause" means (i) Executive being convicted of any felony
(whether or not against the Company or its affiliates), (ii)
willful malfeasance in the performance of Executive's
responsibilities after ten (10) days' written notice to the
Executive and an opportunity to cure; (iii) any material act of
dishonesty by Executive against the Company or any of its
affiliates, (v) a material violation by Executive of any of the
policies or rules of the Company or any of its affiliates or (vi)
the voluntary resignation of Executive from employment with the
Company or any of its affiliates. The determination that Cause has
occurred must be made by unanimous vote of all the members of the
Board of Directors of the Company after forty five (45) days'
prior written notice to Executive and an opportunity to appear
before the Board and contest the determination of Cause.
"Disability" means the inability to perform the material
duties of Executive.
"Change of Control" means the occurrence of any of the
following events:
(a) any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant
to which 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 the Company immediately before the consolidation or
merger; or
(b) 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 the Company; or
(c) the shareholders of the Company approve any plan or
proposal for the liquidation or dissolution of the Company; or
(d) 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 the Company'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
the Company, (ii) an individual, or a spouse or a child of such
individual, that on January 1, 2001, owned greater than 20% of the
combined voting power of such Common Stock, or (iii) a trust,
foundation or other entity controlled by an individual or
individuals described in the preceding subsection; or
(e) individuals who constitute the Board on January 1, 2001
(the "Incumbent Board"), cease for any reason to constitute at
least a majority thereof, provided that any person becoming a
director subsequent to January 1, 2001, whose election, or
nomination for election by the Company'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 the Company in which such
person is named as a nominee for director, without objection to
such nomination) will be, for purposes of this clause, considered
as though such Person were a member of the Incumbent Board.
Notwithstanding the foregoing, Incumbent Directors may, by a
two-thirds vote of such Directors, declare a given transaction
will not constitute a Change in Control for purposes of the Plan.
EXECUTED as of the date first above written.
MASTEC, INC.
By: /s/ Joel Citron
-------------------------
Joel Citron, President
EXECUTIVE
/s/ Carmen Sabater
-------------------------
Carmen Sabater
EMPLOYMENT AGREEMENT
AGREEMENT effective as of January 1, 2001 between MASTEC,
INC. (the "Company") and JOSE SARIEGO (the "Executive").
In consideration of the mutual covenants and obligations set
forth in this Agreement, the parties agree as follows:
1. The Company hereby employs the Executive and the Executive
hereby accepts such employment as Senior Vice President and
General Counsel of the Company and its subsidiaries, upon the
terms and conditions set forth in this Agreement. The Executive
will report to the Board of Directors of the Company or its
designee and to the Chief Executive Officer of the Company. The
Executive will have such responsibilities and perform such duties
as the Board of Directors of the Company or its designee assigns
to the Executive, commensurate with his position as Senior Vice
President and General Counsel of the Company.
2. The Executive's employment will be for a term commencing on
January 1, 2001 and ending on the close of business December 31,
2002 (the "Employment Term"). The Employment Term may be extended
by mutual agreement of the parties.
3. During the Employment Term, the Executive will devote the
Executive's full working time, attention and energies to the
business of the Company and its subsidiaries, except that the
Company acknowledges that the Executive may continue to devote a
reasonable amount of his time to serving on the board of directors
of charitable or non-profit organizations so long as such
activities do not unreasonably interfere with the discharge of his
duties for the Company. The Executive will be employed by the
Company at the Company's headquarters in Miami, Florida, and will
travel to such other locations as may be necessary to discharge
his duties. The Company will maintain an office at the Company's
headquarters facility in Miami, Florida, and will provide
secretarial and other support personnel for the Executive, in each
case commensurate with the Executive's status as Senior Vice
President and General Counsel of the Company. The Company will not
request or require the Executive to be employed at another
location without the Executive's consent.
4. The Company will pay to the Executive as compensation for
services rendered during the Employment Term a salary of not less
than $240,000.00 per annum for the year ending December 31, 2001;
the salary for the year ending December 31, 2002 will be
determined by the Compensation Committee of the Board of Directors
of the Company but will not be less than the prior year's salary
(the amount described in this Section 4 for each year, the
"Salary"). The Salary will be paid in accordance with the
Company's normal payroll practices and will be subject to
withholding of taxes and other deductions required by law.
5. The Company and the Executive will agree on a bonus plan for
calendar year 2001 and 2002 as soon as possible after the close of
the preceding calendar year, which bonus plan will be at least as
favorable to the Executive as the 2000 Senior Management Incentive
Compensation Plan. The Board of Directors of the Company may, on
its own initiative and in its sole discretion, award cash or other
bonuses to the Executive, whether or not any of the performance
thresholds in the bonus plan are achieved by the Company or the
Executive.
6. The Company may terminate the employment of the Executive
under this Agreement at any time with or without "Cause" (as
defined below), subject to the other terms and conditions of her
Agreement, by giving the Executive five (5) business days' prior
written notice of termination. In addition to any other
compensation or benefits payable to the Executive under this
Agreement, the Executive upon a termination of employment will
receive all amounts due to the Executive under the Company's
401(k) retirement plan, deferred compensation plan, split dollar
insurance policy or any other benefit plan of the Company in which
the Executive participates. The Executive also will be entitled to
elect continuation of health benefits under COBRA.
7. In the event of (a) a "Change of Control" (as defined below)
or (b) a termination of employment (including as a result of death
or "Disability," as defined below) prior to the expiration of the
Employment Term other than for Cause (each of (a) and (b) a
"Triggering Event"), the Company will pay in cash to the
Executive, immediately upon the effective date of the Triggering
Event and in lieu of all other compensation under this Agreement,
(i) any unpaid portion of the Salary in respect of the remainder
of the Employment Term, (ii) a bonus equal to the greater of (1)
the aggregate of all bonuses under any bonus plans agreed to by
the Company and Executive for 2001 and 2002 that would have been
earned if the Executive was employed for the full performance
period under the bonus plans, to the extent such bonuses have not
already been earned and paid or (B) $400,000.00. In addition, upon
the occurrence of a Triggering Event, all of the Executive's stock
options or restricted stock awards under the Company's 1994 Stock
Incentive Plan, 1999 Non-Qualified Employee Stock Option Plan or
any other option or benefit plan will immediately upon the
effective date of the Triggering Event (A) in the case of options,
become fully vested and immediately exercisable and may be
exercised by Executive for the full remaining term of the options,
and (B) in the case of restricted stock, all restrictions on the
stock will lapse and the stock may be freely sold without further
restriction except as required by applicable law.
8. If any payment or benefits under this Agreement become subject
to the excise tax imposed by Section 4999 of the Internal Revenue
Code of 1986, as amended (the "Code"), or any substitute provision
of the Code, or any interest or penalties are incurred by
Executive with respect to such excise tax (collectively, the
"Excise Tax"), then the Company will pay Executive an additional
amount or amounts (the "Gross-up Payment") such that the net
amount or amounts retained by Executive, after deduction of any
Excise Tax on any of the payments or benefits under this Agreement
and any federal, state and local income tax and Excise Tax on the
Gross-up Payment, will equal the amount of such payment or
benefits prior to the imposition of such Excise Tax. For purposes
of determining the amount of a Gross-up Payment, Executive will be
deemed to pay federal income taxes at the highest marginal rate of
federal income taxation in the calendar year in which the Gross-up
Payment is payable and state and local income taxes at the highest
marginal rate of taxation in the state and locality of Executive's
residence on the date the Gross-up Payment is payable, net of the
maximum reduction in federal income taxes that could be obtained
from any available deduction of such state and local taxes.
a. The Company will pay each Gross-up Payment on the date on
which Executive becomes entitled to the payment or benefits giving
rise to the Excise Tax. If the amount of the Excise Tax is later
determined to be less than the amount taken into account in
calculating the Gross-up Payment, Executive will repay to the
Company (to the extent actually paid by the Company) the portion
of the Gross-up Payment attributable to the overstated amount of
Excise Tax at the time such reduction is finally determined, plus
interest at the rate set forth in Section 1274(b)(2)(B) of the
Code. If the amount of the Excise Tax is later determined to be
more than the amount taken into account in calculating the Gross-
up Payment, the Company will pay Executive an additional Gross-up
Payment in respect of the additional amount of Excise Tax at the
time the amount of the additional tax is finally determined.
9. In the event of a termination of employment for Cause, the
Company will pay in cash to the Executive any accrued and unpaid
Salary to the date of termination. The Executive will not be
entitled to any bonus under any bonus plan or under paragraph 7 of
this Agreement, or to any other compensation from the Company, and
all unvested stock options or restricted stock as to which the
restriction has not lapsed owned by the Executive will terminate
upon the effective date of termination of employment.
Notwithstanding any other provisions of this Agreement, in no
event will the Company cause a termination of employment for Cause
without at least forty-five (45) days' notice to the Executive and
approval of such termination for Cause by the entire Board of
Directors of the Company.
10. The Company will pay for or reimburse the Executive, in
accordance with its practice for executive officers of the
Company, all reasonable and necessary expenses and other
disbursements incurred by the Executive for or on behalf of the
Company in the performance of his duties hereunder. The Executive
will provide such appropriate documentation of expenses and
disbursements as may from time to time be reasonably requested by
the Company.
11. The Company will (a) indemnify and hold the Executive
harmless for any claims, demands, damages, liabilities, losses,
costs and expenses (including attorneys' and paralegal fees and
court costs) incurred or suffered by the Executive in connection
with the Executive's performance of his duties under this
Agreement or otherwise on behalf of the Company or its affiliates
to the fullest extent (including advancement of expenses)
permitted by Florida corporate law for the indemnification of
officers and directors of a Florida corporation, and (b) will
include the Executive as a covered employee under the Company's
directors' and officers' liability insurance policy and employment
practices liability insurance policy.
12. The Executive (and his family) will be entitled to
participate in all of the Company's group health, dental and
disability plans, and other benefit plans for executives of the
Company. The Executive will receive any and all other benefits
accorded by the Company to executive officers of the Company.
13. The parties acknowledge that the provisions of this Agreement
are highly confidential and that disclosure of this Agreement or
its terms would be extremely prejudicial to the other party.
Accordingly, neither party will disclose the terms of this
Agreement to any other person or entity other than third party
advisors with a need to know (such as legal or tax advisors) and
other than when required by law, without the prior written consent
of the other party.
14. The Executive acknowledges that as a result of his employment
with the Company, the Executive will gain knowledge of, and will
have access to, proprietary and confidential information and trade
secrets of the Company and its affiliates. Therefore, Executive
agrees that he will not, in any fashion, form or manner, directly
or indirectly (i) use, disclose, communicate or provide or permit
access to any person or entity, or (ii) remove from the premises
of the Company or any of its affiliates any notes or records
(including copies or facsimiles, whether made by electronic,
electrical, magnetic, optical, laser acoustic or other means),
relating to any confidential, proprietary or secret information of
the Company or any of its affiliates (collectively, "Confidential
Information") (including without limitation (1) the identity of
customers, suppliers, subcontractors and others with whom they do
business; (2) their marketing methods, strategies and related
information; (3) contract terms, pricing, margin or cost
information or other information regarding the relationship
between them and the persons and entities with which they have
contracted; (4) their services, products, software, technology,
developments, improvements and methods of operation; (5) their
results of operations, financial condition, projected financial
performance, sales and profit performance and financial
requirements; (6) the identity of and compensation paid to their
employees and consultants; (7) any business plans, models or
strategies and the information contained therein; (8) their
sources, leads or methods of obtaining new business; and (9) all
other confidential information of, about or concerning the
business of the Company and its affiliates), except for (x)
information that is or becomes available to the public generally
other than as a result of an unauthorized disclosure by the
Executive, including as an example publicly-available information
filed by the Company with the Securities and Exchange Commission
or other governmental or regulatory authorities, (y) information
that is generally known in the business of the Company or its
affiliates or that constitutes standard industry practices,
customs and methods, or (z) information known to the Executive
prior to joining the Company or its predecessors or gained during
his employment with the Company from sources outside of the
Company or its employees, officers, directors, consultants,
advisors or other representatives. The Executive will be entitled
to use Confidential Information in the discharge of his duties to
the Company.
15. In consideration of the compensation and benefits paid to
Executive under this Agreement, Executive agrees that during the
Employment Term and, in the case of a termination of this
Agreement for Cause, for two (2) years after the termination (the
"Non-Competition Period"), Executive will not within the United
States of America or the Commonwealth of Canada:
a. directly or indirectly own, manage, operate, control, be
employed by, consult with or participate in the ownership,
management, operation or control of, or be connected in any manner
with, any business of the type and character engaged in and
competitive with the business of the Company or any of its
affiliates, as it exists now or in the future. For these
purposes, ownership of securities of 1% or less of any class of
securities of a public company will not be considered to be
competition with the Company;
b. solicit, persuade or attempt to solicit or persuade any
existing customer or any client or potential customer or client to
which the Company or any of its affiliates has made a presentation
or with which any of them has been having discussions to cease
doing business with or decrease the amount of business done with
or not to hire the Company or any of its affiliates or to commence
doing business with or increase the amount of business done with
or hire another person or entity;
c. solicit, persuade or attempt to solicit or persuade any
individual who is an employee of the Company or any of its
affiliates to leave their employ or to become employed by any
other person or entity.
It is the desire and intent of the parties to this Agreement
that the provisions of Sections 14 and 15 will be enforced to the
fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. If
any particular provisions or portion of Sections 14 or 15 is
adjudicated invalid or unenforceable, this section will be deemed
amended to delete any provision or portion adjudicated to be
invalid or unenforceable, the amendment to apply only with respect
to the operation of that section in the particular jurisdiction in
which the adjudication is made. The parties recognize that the
performance by Executive of his obligations under Sections 14 and
15 are special, unique and extraordinary in character, and that if
Executive breaches or threatens to breach the terms and conditions
of this Agreement, the Company may suffer irreparable injury for
which no adequate remedy at law may exist. Accordingly, in the
event of such breach or threatened breach, the Company will be
entitled, if it so elects, to institute and prosecute proceedings
in any court of competent jurisdiction, either in law or in
equity, to obtain damages for any breach of this Agreement, to
enforce the specific performance of this Agreement by Executive,
or to enjoin Executive from breaching or attempting to breach this
Agreement.
16. THE COMPANY AND EXECUTIVE KNOWINGLY, VOLUNTARILY,
IRREVOCABLY, UNCONDITIONALLY AND INTENTIONALLY WAIVE THE RIGHT TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THIS
AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PERSON OR
PARTY AND RELATED TO THIS AGREEMENT; THIS IRREVOCABLE WAIVER OF
THE RIGHT TO A JURY TRIAL BEING A MATERIAL INDUCEMENT FOR THE
COMPANY AND EXECUTIVE TO ENTER INTO THIS AGREEMENT.
17. Any notice, demand, consent, agreement, request, or other
communication required or permitted under this Agreement must be
in writing and must be, (i) mailed by first-class United States
mail, registered or certified, return receipt requested, proper
postage prepaid, or (ii) delivered personally by independent
courier (such as FedEx, DHL or similar nationally-recognized
courier), to the parties at the addresses as follows (or at such
other addresses as shall be specified by the parties by like
notice):
if to the Company, to:
MasTec, Inc.
3155 N.W. 77th Avenue
Miami, FL 33122-1205
Attention: Legal Department
if to the Executive, to:
Jose Sariego
540 Bay Point Road
Miami, FL 33137
Each party may on five (5) days' prior notice in the manner
set forth in this Section designate by notice in writing a new
address to which any notice, demand, consent, agreement, request
or communication may thereafter be given, served or sent. Each
notice, demand, consent, agreement, request or communication which
is mailed or hand delivered in the manner described above will be
deemed received for all purposes at such time as it is delivered
to the addressee (with the return receipt or the courier delivery
receipt being deemed conclusive evidence of such delivery) or at
such time as delivery is refused by the addressee upon
presentation.
18. This Agreement: (a) may be executed in counterparts, and all
counterparts will collectively constitute a single agreement, (b)
may not be amended or modified or any provision waived except in
writing, (c) constitutes the entire agreement of the parties and
supersedes all prior agreements or understandings, (d) is binding
upon and inures to the benefit of the parties and their respective
heirs, personal representatives, beneficiaries, joint tenants,
successors and assigns (whether by merger, consolidation, transfer
of all or substantially all assets, or otherwise), and (e) may not
be assigned or the duties delegated without the consent of all
parties except as expressly set forth in this Agreement.
19. This Agreement, the rights and obligations of the parties,
and any claims or disputes relating in any way thereto will be
governed by and construed in accordance with the laws of the State
of Florida, without giving effect to any choice or conflict of law
provision or rule (whether in the State of Florida or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Florida. Each of the
Executive and the Company, by executing this Agreement, (a)
irrevocably submits to the exclusive jurisdiction of any federal
or Florida state court sitting in Miami-Dade County, Florida in
respect of any suit, action or proceeding arising out of or
relating in any way to this Agreement, and irrevocably accepts for
itself and in respect of its property, generally and
unconditionally, the jurisdiction of such courts and to be bound
by any judgment rendered in such courts; (b) waives, to the
fullest extent it may do so effectively under applicable law, any
objection it may have to the laying of the venue of any such suit,
action or proceeding brought in any such court and any claim that
any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum; and (c) irrevocably
consents, to the fullest extent it may do so effectively under
applicable law, to the service of process of any of the
aforementioned courts in any such suit, action or proceeding by
the mailing of copies thereof by registered or certified mail,
postage prepaid, to the Executive or the Company at the address
set forth in this Agreement, such service to become effective five
(5) business days (or such other period of time provided by
applicable law) after such mailing. In addition to any other
rights or remedies that either party may have under this Agreement
or under law, the prevailing party in any suit, action or
proceeding will be entitled to collect from the other party (a)
all of its attorneys' and paralegal fees and other costs and
expenses incurred by the prevailing party (b) interest on any
amount not paid when due at a rate per annum equal to eighteen
percent (18%) or the maximum amount permitted by law.
20. The following definitions will apply for purposes of this
Agreement:
"Cause" means (i) Executive being convicted of any felony
(whether or not against the Company or its affiliates), (ii)
willful malfeasance in the performance of Executive's
responsibilities after ten (10) days' written notice to the
Executive and an opportunity to cure; (iii) any material act of
dishonesty by Executive against the Company or any of its
affiliates, (v) a material violation by Executive of any of the
policies or rules of the Company or any of its affiliates or (vi)
the voluntary resignation of Executive from employment with the
Company or any of its affiliates. The determination that Cause has
occurred must be made by unanimous vote of all the members of the
Board of Directors of the Company after forty five (45) days'
prior written notice to Executive and an opportunity to appear
before the Board and contest the determination of Cause.
"Disability" means the inability to perform the material
duties of Executive.
"Change of Control" means the occurrence of any of the
following events:
(a) any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant
to which 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 the Company immediately before the consolidation or
merger; or
(b) 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 the Company; or
(c) the shareholders of the Company approve any plan or
proposal for the liquidation or dissolution of the Company; or
(d) 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 the Company'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
the Company, (ii) an individual, or a spouse or a child of such
individual, that on January 1, 2001, owned greater than 20% of the
combined voting power of such Common Stock, or (iii) a trust,
foundation or other entity controlled by an individual or
individuals described in the preceding subsection; or
(e) individuals who constitute the Board on January 1, 2001
(the "Incumbent Board"), cease for any reason to constitute at
least a majority thereof, provided that any person becoming a
director subsequent to January 1, 2001, whose election, or
nomination for election by the Company'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 the Company in which such
person is named as a nominee for director, without objection to
such nomination) will be, for purposes of this clause, considered
as though such Person were a member of the Incumbent Board.
Notwithstanding the foregoing, Incumbent Directors may, by a
two-thirds vote of such Directors, declare a given transaction
will not constitute a Change in Control for purposes of the Plan.
EXECUTED as of the date first above written.
MASTEC, INC.
By: /s/ Joel Citron
----------------------------
Joel Citron, President
EXECUTIVE
/s/ Jose Sariego
----------------------------
Jose Sariego