THIS
SEPARATION AGREEMENT (the “Agreement”) is entered
into as of this 23rd day of December, 2008 by and between MasTec,
Inc. a Florida corporation (the “Company”), and Austin
J. Shanfelter (the “Executive”).
WHEREAS,
the Executive has been employed by the Company pursuant to the
terms of an Employment Agreement dated January 1, 2002 and
later extended pursuant to an Extension dated November 3, 2005
by and between the Company and the Executive, and as amended on
December 19, 2005 and April 14, 2008 (collectively the
“Employment Agreement”); and
WHEREAS,
the Employment Term under the Employment Agreement expired on
March 31, 2007, but the Executive has continued to provide
services to the Company pursuant to the terms of the Employment
Agreement; and
WHEREAS,
the Executive and the Company have also entered into a Split-Dollar
Agreement dated November 1, 2002, as amended on
September 15, 2003, January 6, 2006, and June 22,
2007 (collectively, the “Split-Dollar Agreement”) and a
Deferred Bonus Agreement dated November 1, 2002, as amended on
January 6, 2006 and June 22, 2007 (collectively, the
“Deferred Bonus Agreement”), in addition to the
Employment Agreement (the Employment Agreement, Split-Dollar
Agreement and Deferred Bonus Agreement, collectively, the
“Agreements”); and
WHEREAS,
the Company and the Executive have mutually agreed that the
Employment Agreement, the Split-Dollar Agreement, the Deferred
Bonus Agreement, and the Executive’s employment with the
Company and its Affiliates (as defined below), shall terminate on
December 23, 2008 (the “Termination Date”);
and
WHEREAS,
the Company and the Executive acknowledge that the
Executive’s employment is being terminated by the Company
without Cause; and
WHEREAS,
the Company and the Executive now wish to set forth in this
Agreement all of their respective rights and obligations resulting
from such termination of employment and the termination of the
Agreements.
NOW,
THEREFORE, in consideration of the mutual promises and
covenants between the parties, the sufficiency of which is hereby
acknowledged, the Company and the Executive hereby agree to the
following Terms and Conditions:
1.
Recitals . All of the foregoing Recitals are true and
correct and are incorporated as part of these Terms and
Conditions.
2.
Termination of the Agreements . The Company and the
Executive each acknowledge and agree that the Executive’s
employment with the Company and its Affiliates
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shall terminate
as of the Termination Date, and that the Agreements shall terminate
and be of no further force and effect as of the Termination Date.
For purposes of this Agreement, the term “Affiliate”
includes all of the Company’s direct and indirect
subsidiaries and any other entities that directly or indirectly,
through one or more intermediaries, control, are controlled by or
are under common control with the Company. Notwithstanding anything
in this Section 2 to the contrary, this Agreement shall not
terminate any indemnification rights the Executive may have as a
former officer or director of the Company or its Affiliates under
the Company’s Articles of Incorporation or Bylaws, or effect
any claims for benefits under any directors’ and
officers’ liability policy maintained by the Company or its
Affiliates in accordance with the terms of such policy
(collectively, “Indemnification Rights and D&O Insurance
Benefits”).
3.
Severance Benefits . In consideration for the
termination of the Agreements, the Company and the Executive agree
that the Company shall provide the Executive with the following
benefits (the “Severance Benefits”), in each case
reduced by any applicable employment or withholding
taxes:
(a)
Bonus . The Company shall pay to the Executive $2,388,347 on
January 2, 2008 representing any and all amounts due under the
Deferred Bonus Agreement and any other agreements. The estimated
employment and withholding taxes related to such amount is
approximately $777,125.
(b)
Continuation of Health Benefits . All benefits that the
Executive and his family were entitled to under the Company’s
life, health, medical, dental, and disability insurance plans shall
terminate as of the Termination Date. However, the Executive and
his eligible family members shall continue to be eligible to
receive health benefits under the Company’s plan for a period
of 18 months immediately following the Termination Date, if
and to the extent that the Executive elects such continued coverage
pursuant to COBRA and pays for such coverage.
(c)
Stock Options . The stock options granted to the Executive
by the Company that are outstanding as of the Termination Date are
listed on Exhibit A attached hereto (the
“Options”). As a result of the fact that the Company is
terminating the Executive’s employment without Cause, the
Executive shall have the ability to exercise any or all of the
Options at the exercise prices listed on Exhibit A and in
accordance with the terms and conditions set forth in the
respective Option Agreement relating to those Options at anytime on
or before the applicable expiration date for such Options as
reflected on Exhibit A.
(d)
Restricted Stock . Any unvested Restricted Stock that has
been granted to the Executive by the Company shall vest as of the
Termination Date. The estimated employment and withholding taxes
related to such amount is estimated to be approximately
$66,059.
4.
No Further Compensation . The Executive acknowledges
and agrees that other than the Severance Benefits described in
Section 3 above and the Indemnification Rights and D&O
Insurance Benefits, no further compensation or benefits or other
monies are owed to the Executive by the Company arising out of the
Agreements or otherwise on account of his employment or termination
of employment with the Company and its Affiliates. As a result of
the termination of the Split-Dollar Agreement, the Executive hereby
acknowledges and agrees
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that he shall
have no further interest in Policy # 20015875 issued by John
Hancock Variable Life Insurance Company, having a face amount of
$18,000,000, payable on the second to die of the Executive and his
wife (the “Policy”) owned by the Company and
accordingly, that he shall have no further right to designate the
beneficiary or beneficiaries for all or any portion of the death
benefit under the Policy, and that the Company, as the owner of the
Policy, shall be free to maintain (and designate the beneficiary
for the death benefit under the Policy) or cancel and surrender the
Policy in its sole and absolute discretion after the Termination
Date.
5.
Restrictive Covenants .
(a)
Non-Competition and Non-Solicitation .
(i) The
Executive acknowledges and agrees that the Company’s
telecommunications, energy and infrastructure services businesses
are conducted throughout the United States of America and the
Commonwealth of Canada. At all times during the “Restricted
Period” and within the United States of America and the
Commonwealth of Canada (including their possessions, protectorates
and territories, the “Territory”), the Executive shall
not (whether or not then employed by the Company for any reason),
without the Company’s prior written consent:
(1)
Directly or indirectly own, manage, operate, control, be employed
by, act as agent, consultant or advisor for, or participate in the
ownership, management, operation or control of, or be connected in
any manner through the investment of capital, lending of money or
property, rendering of services or otherwise, with, any business of
the type and character engaged in and competitive with the Company.
For these purposes, ownership of securities of one percent (1%) or
less of any class of securities of a public company will not be
considered to be competition with the Company;
(2)
solicit, persuade or attempt to solicit or persuade or cause or
authorize directly or indirectly to be solicited or persuaded any
existing customer, client, or any other person with whom the
Company does business or has a business relationship, or potential
customer or client to which the Company has made a presentation or
with which the Company has been having discussions, to cease doing
business with or decrease the amount of business done with or not
to hire the Company, or to commence doing business with or increase
the amount of business done with or hire another company that is in
the same or similar lines of businesses in which the Company
engages as of the date of this Agreement so as to be deemed to be
in competition with the Company; or
(3)
solicit, persuade or attempt to solicit or persuade or cause or
authorize directly or indirectly to be solicited or persuaded the
business of any person or entity that is a customer or client of
the Company, or any other person with whom the Company does
business or has a business relationship, or was its customer within
two (2) years prior to the Termination Date, for the purpose
of competing with the Company; or
(4)
solicit, persuade or attempt to solicit or persuade, or cause or
authorize directly or indirectly to be solicited or persuaded for
employment, or employ or cause or authorize directly or indirectly
to be employed, on behalf of the Executive or any other person or
entity, any individual who is or was at any time within six
(6) months prior to the Termination Date, an employee of the
Company.
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(ii) For
purposes of Sections 5(a)(i)(1), 5(a)(i)(2) and 5(a)(i)(3) of
this Agreement, the “Restricted Period” shall be the
period during which the Executive was employed by the Company and
ending on March 31, 2009, and with respect to
Section 5(a)(i)(4) of this Agreement, the “Restricted
Period” shall be the period during which the Executive was
employed by the Company and ending on September 30,
2009.
(iii) In
addition to any other rights or remedies the Company may have under
this Agreement or applicable law, the Company shall be entitled to
receive from the Executive reimbursement for all attorneys’
and paralegal fees and expenses and court costs incurred by the
Company in enforcing this Agreement and shall have the right and
remedy to require the Executive to account for and pay over to the
Company all compensation, profits, monies, accruals or other
benefits derived or received, directly or indirectly, by the
Executive from the action constituting a breach of violation of
this Section 5.
(b)
Confidentiality of Proprietary Information, Trade Secrets,
Etc . The Executive acknowledges that as a result of
his employment with the Company, the Executive has gained knowledge
of, and has had access to, proprietary and confidential information
and trade secrets of the Company. Therefore, the Executive agrees
that he shall not, in any fashion, form or manner, directly or
indirectly (i) use, disclose, communicate or provide or permit
access to any person or entity to, Confidential Information (as
defined below) or (ii) remove from the premises of the
Company, 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 (collectively,
“Confidential Information”) (including without
limitation (1) the identity of customers, suppliers,
subcontractors and others with whom the Company does business;
(2) the Company’s marketing methods, strategies and
related information; (3) contract terms, pricing, margin or
cost information or other information regarding the relationship
between the Company and the persons and entities with which the
Company has contracted; (4) the Company’s services,
products, software, technology, developments, improvements and
methods of operation; (5) the Company’s results of
operations, financial condition, projected financial performance,
sales and profit performance and financial requirements;
(6) the identity of and compensation paid to the
Company’s employees and consultants; (7) any of the
Company’s business plans, models or strategies and the
information contained therein; (8) the Company’s
sources, leads or methods of obtaining new business; and
(9) all other confidential information of, about or concerning
the business of the Company), except (w) to the extent
required by law, (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 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 shall deliver promptly to the Company on the
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Termination
Date, all Company memoranda, notes, records, reports, manuals,
drawings, designs, computer files in any media and other documents
(and all copies thereof) containing such Confidential Information
and all property of the Company, which he may then possess or have
under his control.
(c)
Ownership of Developments . All processes, concepts,
techniques, inventions and works of authorship, including new
contributions, improvements, formats, packages, programs, systems,
machines, compositions of matter manufactured, developments,
applications and discoveries, and all copyrights, patent
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