SCHEDULE 14A INFORMATION
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Securities Exchange Act of 1934
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MASTEC, INC.
(Name of Registrant as Specified in Its Charter)
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MasTec
NOTICE OF 2001 ANNUAL MEETING OF SHAREHOLDERS
To our shareholders:
The 2001 Annual Meeting of Shareholders of MasTec, Inc. will be held on Tuesday,
May 8, 2001, at 9:30 a.m., local time, at our corporate headquarters located at
3155 N.W. 77th Avenue, Miami, Florida. At the Annual Meeting, shareholders will
be asked to vote on the following proposals:
* The re-election of Joseph P. Kennedy II, Arthur B. Laffer and Jose S.
Sorzano as Class III directors for terms expiring in 2004; and
* Such other business as may properly be brought before the Annual Meeting.
Each of these proposals is discussed more fully in the Proxy Statement
accompanying this notice. Only shareholders of record at the close of business
on March 12, 2001 are entitled to vote at the Annual Meeting.
All shareholders are cordially invited to attend the Annual Meeting in person.
However, to ensure that your stock is represented at the meeting in case you are
not personally present, you are requested to mark, sign, date and return the
enclosed proxy card as promptly as possible in the envelope provided. As an
alternative, all shareholders are encouraged to vote online as well as to enroll
for electronic delivery of future proxy and other materials. Please go to
www.mastec.com under Investor Relations for more information and enrollment.
Sincerely,
/s/ Nancy Damon
Nancy Damon
Corporate Secretary
Miami, Florida
April 4, 2001
MasTec
PROXY STATEMENT
2001 ANNUAL MEETING OF SHAREHOLDERS
The Board of Directors of MasTec, Inc. ("MasTec") is furnishing this Proxy
Statement to solicit proxies for use at the 2001 Annual Meeting of Shareholders
of MasTec to be held at our corporate headquarters located at 3155 N.W. 77th
Avenue, Miami, Florida, on Tuesday, May 8, 2001, at 9:30 a.m. local time. At the
Annual Meeting, our shareholders will be asked to vote on the following matters,
each of which is described in greater detail elsewhere in this Proxy Statement:
* The re-election of Joseph P. Kennedy II, Arthur B. Laffer and Jose S.
Sorzano as Class III directors for terms expiring in 2004; and
* Such other business as may properly be brought before the Annual Meeting.
The Board of Directors recommends that you vote FOR each of the nominees for
Class III director set forth in this Proxy Statement.
This Proxy Statement and accompanying proxy and other materials are first being
mailed or transmitted electronically on or about April 9, 2001 to shareholders
of record on March 12, 2001. Only shareholders of record at the close of
business on March 12, 2001 are entitled to vote at the Annual Meeting. If you
are not present in person at the Annual Meeting, your shares can be voted only
if represented by proxy. The shares represented by your proxy will be voted in
accordance with your instructions only if you properly complete, sign and return
the accompanying proxy card to our Corporate Secretary prior to the Annual
Meeting or vote your ballot online.
Shareholders may be eligible to vote electronically through the Internet or by
telephone. Please go to www.mastec.com under Investor Relations for more
information on voting online and registering to receive future proxy and other
materials online.
Shareholders not wishing to vote electronically through the Internet or whose
proxy card does not reference Internet or telephone voting information should
complete and return the enclosed paper proxy card. Signing and returning the
proxy card or submitting the proxy via the Internet or by telephone does not
affect the right to vote in person at the Annual Meeting. If no choice is
specified on the proxy card, the shares represented by the proxy will be voted
for the election of all nominees for director and in the discretion of the
holder of the proxy on all other matters that may properly come before the
Annual Meeting.
A proxy given pursuant to this solicitation may be revoked at any time prior to
its exercise by written notice delivered to our Corporate Secretary, by
executing and delivering to our Corporate Secretary a proxy with a later date,
by attending the Annual Meeting and voting in person or by voting
electronically. With respect to electronic votes, the last vote transmitted will
be the vote counted. Attendance at the Annual Meeting will not, in itself,
constitute revocation of a proxy.
Our only class of voting securities is our common stock. At March 12, 2001,
there were 47,719,144 shares of our common stock outstanding, which is the only
class of our capital stock outstanding. As of March 12, 2001, MasTec had 4,134
record shareholders.
Each share of our common stock entitles its holder to one vote on all matters
properly brought before the Annual Meeting. The presence, in person or by proxy,
of a majority of the shares entitled to vote is necessary to constitute a quorum
at the Annual Meeting. If a quorum is present, directors are elected by a
plurality of the votes of the shares voting in person or represented by proxy at
the Annual Meeting, which means that the three nominees receiving the highest
number of votes will be elected to the Board of Directors.
Shares that are entitled to vote but that are not voted at the direction of the
beneficial owner ("abstentions"), shares represented by proxies or ballots that
are marked "withhold authority," and votes withheld by brokers in the absence of
instruction from beneficial holders ("broker nonvotes") will be counted for the
purpose of determining whether there is a quorum for the transaction of business
at the Annual Meeting. In determining whether a matter requiring approval of a
majority of the shares voting at the Annual Meeting has been approved or whether
a nominee for director has received a plurality of the shares, abstentions,
withheld votes and broker nonvotes will be disregarded and will have no effect
on the outcome of the vote.
ELECTION OF DIRECTORS
The first matter that shareholders will be asked to vote upon at the Annual
Meeting is the re-election of Joseph P. Kennedy II, Arthur B. Laffer and Jose S.
Sorzano as Class III directors for terms expiring at the annual meeting of
shareholders in the year 2004. The Board of Directors currently is composed of
seven directors elected in three classes, with two Class I, two Class II, and
three Class III directors. Directors in each class hold office for three-year
terms. The terms of the classes are staggered so that the term of only one class
terminates each year. The terms of the current Class III directors expire at the
Annual Meeting; if elected, the nominees for Class III directors will serve
until the annual shareholders meeting in 2004. The terms of the Class I
directors expire at the annual shareholders meeting in 2002 and the terms of the
Class II directors expire at the annual meeting of shareholders in 2003.
Additional background information regarding Messrs. Kennedy, Laffer and Sorzano
is provided below. MasTec has no reason to believe that any of these nominees
will refuse or be unable to serve as a director if elected; however, if any of
the nominees is unable to serve, each proxy that does not direct otherwise will
be voted for a substitute nominee designated by the Board of Directors.
The election of directors requires the affirmative vote of a plurality of the
shares of common stock voting in person or by proxy at the Annual Meeting. The
Board of Directors recommends that you vote FOR each of the nominees named
above. Unless otherwise indicated, the accompanying form of proxy will be voted
FOR the election of each of the nominees for election as a Class III director
named above.
Information as to Nominees and Other Directors
Nominees for Class III Directors
Joseph P. Kennedy II, 48, has been a member of the Board of Directors since
October 1999. Mr. Kennedy is Chairman of Citizens Energy Corporation, a
not-for-profit energy provider that he founded in 1979. Mr. Kennedy served six
terms as a U.S. Representative during which time he was a member of the House
Banking and Financial Services Committee, a senior member of the House Veteran's
Affairs Committee and the co-chair of the Older American Caucus. He also served
as the ranking Democrat on the Housing and Community Opportunity Subcommittee.
Arthur B. Laffer, 60, has been a member of the Board of Directors since March
1994. Mr. Laffer has been Chairman of the Board of Directors of Laffer
Associates, an economic research and financial consulting firm, since 1979;
Chief Executive Officer, Laffer Advisors Inc., an investment advisor and
broker-dealer, since 1981; and Chief Executive Officer, Laffer Investments, an
investment management firm, since 1999. Mr. Laffer is a director of Nicholas
Applegate Growth Fund, Oxigene, Inc., Neff Corp., Pacificare Health Systems
Inc., a leading managed healthcare services company, and Vivendi Environment, a
water purification, treatment and management company.
Jose S. Sorzano, 60, has been a member of the Board of Directors since October
1994. Mr. Sorzano has been Chairman of the Board of Directors of The Austin
Group, Inc., an international corporate consulting firm, since 1989. Mr. Sorzano
was also Special Assistant to the President for National Security Affairs from
1987 to 1988; Associate Professor of Government, Georgetown University, from
1969 to 1987; and Ambassador and U.S. Deputy to the United Nations from 1983 to
1985.
Class I Directors
Jorge Mas, 38, has been our Chairman of the Board of Directors since January
1998 and a director since March 1994. From March 1994 to October 1999, Mr. Mas
was our Chief Executive Officer. In addition, Mr. Mas is the Chairman of the
Board of Directors of Neff Corp. and is a member of the Board of Directors of
Nova Southeastern University. Mr. Mas has been Chairman of the Board of the
Jorge Mas Canosa Freedom Foundation, Inc., a not-for-profit organization, since
July 1999.
Joel-Tomas Citron, 38, has been our Chief Executive Officer since October 1999
and our President since May 1999. He has been a member of our Board of Directors
since January 1998. Mr. Citron was the managing partner of Triscope Capital LLC,
a private investment partnership, from January 1998 until December 1998, and
Chairman of the Board of Directors of the United States subsidiary of Proventus
AB, an investment company based in Stockholm, Sweden, from January 1992 to
December 1997 (Proventus AB was publicly traded on the Stockholm Exchange until
1995). Mr. Citron is also a member of the Board of Directors of Neff Corp.;
Oxigene, Inc.; Proflowers.com, an e-commerce company; Telergy, Inc., a
facilities-based provider of integrated communications services and high
bandwidth fiber optic capacity; and past Chairman of the Board of Directors of
American Information Systems, Inc. (now owned by Exodus Communications, Inc.), a
provider of Internet and Internet systems solutions.
Class II Directors
Olafur Olafsson, 38, has been a member of the Board of Directors since September
1999. Mr. Olafsson has been Vice Chairman of Time Warner Digital Media since
November 1999. Prior to joining Time Warner Digital Media, Mr. Olafsson was
President of Advanta Corporation, a financial services company, from March 1998
until October 1999, and a member of Advanta's Board of Directors since 1997.
Prior to joining Advanta, Mr. Olafsson was the founder and President of Sony
Interactive Entertainment, Inc., an interactive entertainment software and
hardware unit of Sony Corporation established in 1991.
William N. Shiebler, 59, has been a member of the Board of Directors since June
1999. Mr. Shiebler was a Senior Managing Director of Putnam Investments, a
Boston based investment management firm, and President of Putnam Mutual Funds
from 1990 until 2000. Before joining Putnam, he was President and Chief
Operating Officer of Dean Witter Reynolds Intercapital, the investment
management division of Dean Witter Reynolds, Inc., and Executive Vice President
and director of Dean Witter Reynolds, Inc. Mr. Shiebler is a director or trustee
of a number of private companies and not-for-profit charitable institutions.
Other Information Regarding the Board of Directors
Board and Committee Meetings
During 2000, the Board of Directors met on seven occasions. Each of the
directors attended at least 75% percent of the Board meetings and the meetings
of committees of which such director is a member held during the periods for
which they served.
There are four standing committees of the Board of Directors: the Executive
Committee, the Audit Committee, the Compensation Committee, and the Nominating
Committee.
The Executive Committee is composed of Jorge Mas, who serves as Chairman,
Joel-Tomas Citron and Arthur B. Laffer. The principal function of the Executive
Committee is to act for the Board of Directors when action is required between
full Board meetings. During 2000, the Executive Committee met on three
occasions.
The Audit Committee is composed of Arthur B. Laffer, who serves as Chairman,
Olafur Olafsson and William N. Shiebler. The Audit Committee oversees MasTec's
financial reporting and compliance program on behalf of the Board of Directors.
Under the rules of the New York Stock Exchange, all of the members of the Audit
Committee are independent. The Board of Directors has adopted a written charter
of the Audit Committee, a copy of which was filed with the proxy statement for
the 2000 annual meeting of shareholders. During 2000, the Audit Committee met on
five occasions.
The Compensation Committee is composed of Arthur B. Laffer, who serves as
Chairman, Olafur Olafsson, William N. Shiebler and Jose S. Sorzano. The
Compensation Committee is charged with determining compensation packages for the
Chief Executive Officer and the other senior management of MasTec, establishing
salaries, bonuses and other compensation for MasTec's other executive and
operating officers, administering MasTec's stock option, stock purchase and
incentive compensation plans and recommending to the Board of Directors changes
to the plans. During 2000, the Compensation Committee met on one occasion.
The Nominating Committee is composed of Jorge Mas, who serves as Chairman, and
Joseph P. Kennedy II. The Nominating Committee recommends to the Board of
Directors candidates for election to the Board of Directors. The Committee
considers candidates recommended by the shareholders pursuant to written
applications submitted to our Corporate Secretary. Shareholder proposals for
nominees should include biographical and other information regarding the
proposed nominee sufficient to comply with applicable disclosure rules and a
statement from the shareholder as to the qualifications and willingness of the
candidate to serve on our Board of Directors. During 2000, the Nominating
Committee met on one occasion.
Audit Committee Report
For 2000, the Audit Committee reviewed and recommended to the Board of Directors
the independent auditors to be selected to audit MasTec's financial statements.
The Audit Committee also reviewed the scope of the proposed annual audit for
2000 and the audit procedures to be applied, including approving the annual
audit fee proposal from the independent auditors. They also discussed with the
independent auditors the matters required to be discussed by Statement of
Auditing Standards No. 61. The Committee reviewed the written disclosures and
the letter from the independent auditors required by Independence Standards
Board Standard No. 1 and discussed with the independent auditors their
independence.
Additionally, the Audit Committee reviewed the completed audit, and discussed
the results with management. Based on these reviews, the Audit Committee
recommended to the Board of Directors that the audited financial statements be
included in MasTec's Annual Report on Form 10-K.
Audit Committee
Arthur B. Laffer
Olafur Olafsson
William N. Shiebler
MasTec incurred the following fees for services performed by
PricewaterhouseCoopers LLP, MasTec's independent auditors, for 2000: (a) audit
fees - $275,250; (b) financial information systems design and implementation -
$0; and (c) other (principally tax structuring advice and acquisition due
diligence) - $419,000. The Audit Committee considered whether the provision of
these non-audit services is compatible with such firm's independence.
Compensation of Directors
Under MasTec's Non-Employee Directors' Stock Option Plan, our non-employee
directors are eligible to receive annually options to purchase shares of common
stock. The amount and exercise price of the options granted under this plan are
set by the Compensation Committee. Options issued under the plan are in lieu of
all other compensation to directors for their services as directors. Directors
are reimbursed for their reasonable expenses in attending Board and committee
meetings.
SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the beneficial ownership as of March 12, 2001 of
common stock by (i) each person known to MasTec to beneficially own more than 5%
thereof, (ii) each director of MasTec and each Named Executive Officer (as
defined under the caption Executive Compensation below), and (iii) all executive
officers and directors of MasTec as a group. Unless otherwise indicated, each
named shareholder has sole voting and investment power with respect to the
shares beneficially owned by the shareholder.
Percent of
Amount of Common Stock
Name Common Stock Outstanding
------ ------------------ -----------
Jorge Mas 20,827,538 (1) 43.7%
Joel-Tomas Citron 627,829 (2) 1.3%
Joseph P. Kennedy II 12,675 (2) *
Arthur B. Laffer 212,778 (2) *
Olafur Olafsson 12,675 (2) *
William N. Shiebler 27,933 (2) *
Jose S. Sorzano 69,503 (2) *
Austin J. Shanfelter 160,439 (2) *
Carmen M. Sabater 96,368 (2) *
Jose Sariego 70,286 (2) *
Arlene Vargas 6,052 (2) *
All executive officers and 22,124,076 46.0%
directors as a group (11 persons)
Morgan Stanley Dean Witter & Co. 2,763,577 (3) 5.8%
*Less than 1%
(1) Includes 11,273,716 shares owned directly by the Jorge L. Mas Canosa
Holdings I Limited Partnership (the "Family Partnership"), and indirectly
by Jorge Mas, as an officer and the sole director of Jorge L. Mas Holdings
Corporation, a Texas corporation, the sole general partner of the Family
Partnership; and 8,380,966 shares owned of record by Jorge Mas Holdings I
Limited Partnership, a Texas limited partnership ("Jorge Mas Holdings").
The sole general partner of Jorge Mas Holdings is Jorge Mas Holdings
Corporation, a Texas corporation that is wholly-owned by Mr. Mas. Also
includes 282,670 shares owned of record by the Mas Family Foundation, a
Florida not-for-profit corporation (the "Family Foundation"); 671,791
shares covered by options exercisable within 60 days of March 12, 2001; and
218,395 shares owned of record individually. Mr. Mas disclaims beneficial
ownership of the shares held by the Family Partnership except to the extent
of his pecuniary interest therein, and disclaims beneficial ownership of
all of the shares owned by the Family Foundation.
(2) The amounts shown include shares covered by options exercisable within 60
days of March 12, 2001 as follows: Joel-Tomas Citron, 615,000 shares;
Joseph P. Kennedy II, 12,675 shares; Arthur B. Laffer, 75,525 shares;
Olafur Olafsson, 12,675 shares; William N. Shiebler, 12,675 shares; Jose S.
Sorzano, 67,250 shares; Austin J. Shanfelter, 74,643 shares; Carmen M.
Sabater 87,376 shares; Jose Sariego, 53,991 shares; and Arlene Vargas 5,500
shares.
(3) Morgan Stanley Dean Witter & Co. ("MSDW") filed a Schedule 13G dated
January 31, 2001 with the Securities and Exchange Commission reporting
beneficial ownership of more than 5% of MasTec's common stock. As reported
in the Schedule 13G, MSDW possesses sole voting power with respect to 0
shares and possesses shared voting power with respect to 2,744,227 shares.
As reported in the Schedule 13G, MSDW possesses shared dispositive power
with respect to 2,763,577 shares.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Based solely upon a review of the copies of the forms furnished to MasTec,
MasTec believes that, during 2000, all filing requirements under Section 16(a)
of the Securities Exchange Act of 1934 applicable to its officers, directors and
greater than 10% beneficial owners were complied with on a timely basis with the
exception of Mr. Sariego and Ms. Sabater who filed a Form 4 on June 19, 2000 to
report employee stock option grants of 17,418 and 17,420 shares, respectively,
on December 15, 1999.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee") is
responsible for establishing and administering the policies for MasTec's
compensation programs and for approving the compensation levels of the
executives and managers of MasTec, including its Chief Executive Officer. The
Committee also reviews with the Chief Executive Officer guidelines for salaries
and bonus awards applicable to MasTec's employees other than its executives and
managers. The Committee is composed of Arthur B. Laffer, who serves as Chairman,
and Olafur Olafsson, William N. Shiebler and Jose S. Sorzano, all of whom are
non-employee directors of MasTec.
Statement of Philosophy of Executive Compensation
The executive compensation program of MasTec is designed to (i) provide base
compensation reasonably comparable to that offered by other leading companies to
their executives and managers so as to attract and retain talented personnel,
(ii) motivate executives and managers to achieve the strategic goals set by
MasTec by linking an executive's or a manager's incentive compensation to the
performance of MasTec and applicable business units, as well as to individual
performance, and (iii) align the interests of MasTec's executives and managers
with the long-term interests of its shareholders through the award of stock
options and other stock-related programs. To implement this philosophy, MasTec
fers its executives and managers compensation packages that include a mix of
salary, incentive bonus awards, and stock options.
In determining the level and form of executive compensation to be paid or
awarded, the Committee relies primarily on MasTec's results of operations and,
in the case of senior executives, an assessment of MasTec's overall performance
in light of its strategic objectives. The Committee considered a number of
factors in establishing 2000 compensation, none of which was quantified, ranked
or assigned relative weigh.
* The substantial increase in revenue and earnings in comparison to prior
years.
* The significant increase in the MasTec's shareholders' equity and other
balance sheet improvements.
* The upgrade of MasTec's debt securities to investment grade by Moody's and
Standard & Poor's.
* The further diversification, expansion, and branding of MasTec's core
business through acquisitions and new service offerings.
* The continued divestiture of non-core assets to concentrate resources on
MasTec's core business.
* Individual performance.
Salary
The base salary of executives and managers is determined initially by analyzing
and evaluating the responsibilities of the position and comparing the proposed
base salary with that of executives and managers in comparable positions in
other companies. Adjustments are determined by objective factors such as
MasTec's performance and the individual's contribution to that performance and
subjective considerations such as additional responsibilities taken on by the
executive or manager. The Committee awarded increases in base salary in 2000 to
certain of the executive officers and managers of MasTec, including certain of
the Named Executive Officers identified under the caption "Executive
Compensation" below.
Incentive Awards
In addition to paying a base salary, MasTec awards incentive bonuses as a
component of overall compensation. MasTec has established formal incentive
compensation plans for our senior executives at both the corporate and
operational levels that award incentive bonuses based on MasTec's or an
individual unit's performance as measured primarily by earnings before interest
and taxes ("EBIT") and return on assets. Awards are based on a multiple of base
salary or a percentage of EBIT. A portion of the bonus may be awarded in stock
and stock options. MasTec or the individual unit must meet certain minimum
thresholds before any bonus is earned. For 2000, the Committee awarded bonuses,
including stock and stock options, to certain of MasTec's executives and
managers, including the Named Executive Officers, under these plans.
CEO Compensation
Joel-Tomas Citron, our President and Chief Executive Officer, was paid a salary
of $500,000 for 2000. The Committee also awarded Mr. Citron a bonus of $831,000
in cash for 2000. The Committee considered the same factors described above in
establishing Mr. Citron's compensation, with particular emphasis on MasTec's
EBIT from North American operations. The Committee is currently finalizing a new
employment agreement with Mr. Citron.
Compensation Committee
Arthur B. Laffer
Olafur Olafsson
William N. Shiebler
Jose S. Sorzano
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table summarizes all compensation awarded to, earned by or paid to
(a) MasTec's Chief Executive Officer and (b) the four other most highly
compensated executive officers of MasTec whose total salary and bonus exceeded
$100,000 (together, the "Named Executive Officers") for services rendered in all
capacities to MasTec and its subsidiaries for the years ended December 31, 2000,
1999 and 1998.
---------------------------------------- -------------------------------
Annual Compensation Long Term Compensation
---------------------------------------- -------------------------------
Name and Securities All Other
Principal Position Year Salary ($) Bonus ($) Underlying Options (4) Compensation(5)
- ------------------ ---- ---------- ----- ---------------------- ---------------
Joel-Tomas Citron, 2000 496,154 831,000 -- --
President and Chief 1999 311,538 1,000,000 (2) 450,000 --
Executive Officer(1) 1998 123,076 -- 375,000 --
Austin J. Shanfelter 2000 213,657 300,000 150,000 --
Executive Vice 1999 -- -- -- --
President/Chief 1998 -- -- -- --
Operating Officer(1)
Carmen M. Sabater 2000 224,194 337,500 (3) 17,420 755
Executive Vice 1999 168,462 225,000 (2) 97,500 540
President/ Chief 1998 174,267 -- -- 540
Financial Officer
Jose Sariego 2000 224,038 200,000 (3) 17,418 888
Senior Vice President/ 1999 175,150 175,000 (2) 48,750 935
General Counsel 1998 171,605 -- -- 880
Arlene Vargas 2000 134,892 67,500 (3) 9,375 --
Vice President/ 1999 125,225 65,500 (2) 7,500 --
Controller (1) 1998 -- -- -- --
(1) Mr. Citron became an executive officer in November 1998. Mr. Shanfelter
became an executive officer in 2000. Ms. Vargas became an executive officer
in 1999.
(2) The 1999 bonuses were paid in a combination of cash and stock valued at
fair market value on the date of grant as follows: Joel-Tomas Citron,
$150,000 in stock; Carmen M. Sabater, $26,250 in stock; Jose Sariego,
$26,250 in stock; and Arlene Vargas, $9,375 in stock.
(3) The 2000 bonuses were paid in a combination of cash and stock valued at
fair market value on the date of grant as follows: Carmen M. Sabater,
$50,625 in stock; Jose Sariego, $30,000 in stock; and Arlene Vargas,
$10,125 in stock.
(4) Option amounts have been adjusted for a three-for-two stock split effective
June 19, 2000.
(5) Represents premiums paid by the Company for term life insurance on the
lives of the Named Executive Officers.
Option Grants
The following table provides information with respect to options to purchase
common stock granted to the Named Executive Officers for the year ended December
31, 2000:
Individual Grants
-------------------------------------
Percent of
Total
Number Options Potential Realizable Value
of Shares Granted to at Assumed Annual Rates
Underlying Employees Exercise of Stock Price Appreciation
Options for Fiscal Price Expiration for Option Term (3)
Name Granted Year (1) ($/sh)(2) Date 5% 10%
- ----- -------- ---------- --------- ---------- --------- -----------
Joel-Tomas Citron - - - - - -
Austin J. Shanfelter 150,000 21.07 $33.79 02/07/07 $2,063,492 $4,808,815
Carmen M. Sabater 17,420 2.45 $26.79 12/15/07 $222,834 $533,726
Jose Sariego 17,418 2.45 $26.79 12/15/07 $222,808 $533,665
Arlene Vargas 9,375 1.32 $26.79 12/15/07 $119,924 $287,238
(1) Based on options to purchase an aggregate of 711,820 shares of common stock
granted to employees for 2000.
(2) All options were granted at an exercise price equal to fair market value
based on the mean between the high and low sale prices of the common stock
on the New York Stock Exchange on the date of grant.
(3) Potential gains are net of exercise price, but before taxes associated with
exercise. These amounts represent certain assumed rates of appreciation
only, based on Securities and Exchange Commission rules, and do not
represent MasTec's estimate or projection of the price of MasTec's stock in
the future. Actual gains, if any, on stock option exercises depend upon the
actual future performance of MasTec's common stock and the continued
employment of the option holders throughout the vesting period.
Accordingly, the potential realizable values set forth in this table may
not be achieved or may be exceeded.
Employment Agreements
Effective January 1, 2001, MasTec entered into employment agreements with Austin
J. Shanfelter, Carmen M. Sabater and Jose Sariego relating to their employment
as Chief Operating Officer, Chief Financial Officer and General Counsel,
respectively. Each of the agreements is for a term of two (2) years unless
earlier terminated, and provides that Mr. Shanfelter, Ms. Sabater and Mr.
Sariego will be paid an annual salary of not less than $325,000, $270,000 and
$240,000, respectively. Each agreement also provides for a bonus to be paid
pursuant to an incentive compensation plan to be agreed upon, which plan may not
be less favorable than the plan in effect for 2000. Additionally, if there is a
change of control of MasTec during the employment term, the executive will be
entitled to all of the unpaid portion of his or her salary for the remaining
term of the agreement, to an immediate bonus payment and to immediate vesting of
any previously unvested options. The agreement also contains non-competition and
non-solicitation provisions during the term of the agreement.
Aggregate Option Exercises and Year-End Option Values
The following table sets forth information with respect to each exercise of
stock options during the year ended December 31, 2000 by the Named Executive
Officers and the value at December 31, 2000 of unexercised stock options held by
the Named Executive Officers.
Number of Shares Value of Unexercised in-
Shares Underlying Unexercised the-Money Options at
Acquired Value Options at December 31, 2000 December 31, 2000 (1)
On Exercise Realized Exercisable/Unexercisable Exercisable/Unexercisable
(#) ($) #) ($)
Joel-Tomas Citron 0 0 615,000/225,000 2,801,764/159,368
Austin J. Shanfelter 0 0 20,743/185,186 69,119/93,006
Carmen M. Sabater 0 0 82,876/82,295 363,790/122,045
Jose Sariego 10,988 287,095 47,651/59,718 174,240/116,368
Arlene Vargas 0 0 5,500/18,875 32,250/48,375
(1) Market value of shares underlying in-the-money options at December 31,
2000 based on the product of $20.50 per share, the fair market value of
MasTec's common stock on the New York Stock Exchange on December 31,
2000, less the exercise price of each option, times the number of
in-the-money options as of that date.
Performance Graph
The following graph compares the cumulative total shareholder return on MasTec's
common stock from December 31, 1995 through December 31, 2000 with the
cumulative total return of the S & P 500 Stock Index and a company-constructed
index of eight peer companies consisting of Able Telcom Holding Corp. (which was
purchased by Bracknell Corporation in 2000), Arguss Holdings, Inc., Black Box
Corp., Dycom Industries, Inc., International Fibercom, Inc., LCC International
Inc., Quanta Services, Inc., and Wireless Facilities Inc. The graph assumes that
the value of the investment in the common stock was $100 on December 31, 1995
and that all dividends were reinvested. This data is not necessarily indicative
of future results.
12/31/95 12/31/96 12/31/97 12/31/98 12/31/99 12/31/00
-------- -------- -------- -------- -------- --------
MasTec $100.00 $400.00 $258.96 $237.74 $503.77 $339.61
S&P 500 $100.00 $122.96 $163.98 $210.84 $255.22 $231.98
Peer Group $100.00 $232.54 $239.56 $341.47 $461.97 $465.31
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
As of December 31, 2000, Joel-Tomas Citron and Carmen M. Sabater were indebted
to MasTec for $750,000 and $125,000, respectively, under a non-interest bearing
demand loan. As of December 31, 2000, Juan Carlos Mas and Jose Ramon Mas, the
brothers of Jorge Mas, were indebted to MasTec for $169,000, and $143,000,
respectively, plus accrued interest.
MasTec purchases and leases equipment from a company in which Jorge Mas has a
significant interest. MasTec believes the value of these transactions is not
material.
SELECTION OF AUDITORS
PricewaterhouseCoopers LLP was appointed by the Board of Directors of MasTec to
audit MasTec's financial statements for 2000. PricewaterhouseCoopers LLP has
acted as independent public accountants for MasTec since 1995. Representatives
of PricewaterhouseCoopers LLP will be present at the Annual Meeting, will have
an opportunity to make a statement if they so desire and will be available to
respond to appropriate questions from shareholders.
MISCELLANEOUS
A list of MasTec's shareholders as of March 12, 2001, the record date for the
Annual Meeting, will be available for inspection at our corporate headquarters
located at 3155 N.W. 77th Avenue, Miami, Florida, during normal business hours
during the 10 day period prior to the Annual Meeting.
Pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, if a
shareholder notifies MasTec after December 5, 2001, of an intent to present a
proposal at MasTec's annual meeting of shareholders in the year 2002 (and for
any reason the proposal is voted upon at that Annual Meeting), MasTec's proxy
holders will have the right to exercise discretionary voting authority with
respect to the proposal, if presented at the meeting, without including
information regarding the proposal in our proxy materials. Any proposal of an
eligible shareholder intended to be presented at the annual meeting of
shareholders of MasTec in 2002 must be received by MasTec by February 16, 2002
to be eligible for inclusion in MasTec's proxy statement and form of proxy
relating to that annual meeting.
The Board of Directors does not intend to present and knows of no others who
intend to present at the Annual Meeting any matter or business other than that
set forth in the accompanying Notice of Annual Meeting of Shareholders. If other
matters are properly brought before the Annual Meeting, it is the intention of
the persons named in the accompanying form of proxy to vote any proxies on such
matters in accordance with their judgment.
MasTec's Annual Report on Form 10-K for the year ended December 31, 2000 is
being mailed or transmitted with this Proxy Statement to shareholders of record
as of March 12, 2001.
By order of the Board of Directors
/s/ Nancy Damon
Nancy Damon
Corporate Secretary
Miami, Florida
April 4, 2001