This excerpt taken from the TPP 8-K filed Feb 28, 2008.
At a special meeting of its unitholders on December 8, 2006, TEPPCOs unitholders approved the EPCO, Inc. 2006 TPP Long-Term Incentive Plan (2006 LTIP), which provides for awards of TEPPCOs Units and other rights to our non-employee directors and to employees of EPCO and its affiliates providing services to us. Awards granted under the 2006 LTIP may be in the form of restricted units, phantom units, unit options, unit appreciation rights (UARs) and distribution equivalent rights. The exercise price of unit options or UARs awarded to participants is determined by the Audit, Conflicts and Governance Committee of our board of directors (ACG Committee) (at its discretion) at the date of grant and may be no less than the fair market value of the option award as of the date of grant. The 2006 LTIP is administered by the ACG Committee. Subject to adjustment as provided in the 2006 LTIP, awards with respect to up to an aggregate of 5,000,000 of TEPPCOs Units may be granted under the 2006 LTIP. We reimburse EPCO for the costs allocable to 2006 LTIP awards made to employees who work in our business.
On April 30, 2007 and May 2, 2007, our non-employee directors were awarded 1,647 phantom units, which payout in 2011, and 66,225 UARs, which vest in 2012. On May 22, 2007, 155,000 unit options, 62,900 restricted units and 338,479 UARs were granted to employees providing services directly to us, which vest in 2011, 2011 and 2012, respectively.
The 2006 LTIP may be amended or terminated at any time by the board of directors of EPCO, which is an affiliate of ours under common control of Dan L. Duncan, or the ACG Committee; however, any material amendment, such as a material increase in the number of TEPPCO Units available under the plan or a change in the types of awards available under the plan, would require the approval of at least 50% of TEPPCOs unitholders. The ACG Committee is also authorized to make adjustments in the terms and conditions of, and the criteria included in awards under the 2006 LTIP in specified circumstances. The 2006 LTIP is effective until December 8, 2016 or, if earlier, the time which all available TEPPCO Units under the 2006 LTIP have been delivered to participants or the time of termination of the 2006 LTIP by EPCO or the ACG Committee. After giving effect to outstanding unit options and restricted units at December 31, 2007, and the forfeiture of restricted units (see below) through December 31, 2007, a total of 4,782,600 additional TEPPCO Units could be issued under the 2006 LTIP in the future.
TEXAS EASTERN PRODUCTS PIPELINE COMPANY, LLC AND SUBSIDIARIES
NOTES TO CONSOLIDATED BALANCE SHEET - (Continued)
This excerpt taken from the TPP 8-K filed Nov 16, 2007.
The Texas Eastern Products Pipeline Company, LLC 2000 Long Term Incentive Plan (“2000 LTIP”) provides key employees incentives to achieve improvements in TEPPCO’s financial performance. Generally, upon the close of a three-year performance period, if the participant is still an employee of EPCO, the participant will receive a cash payment equal to (i) the applicable “performance percentage” as specified in the award multiplied by (ii) the number of phantom units granted under the award multiplied by (iii) the average of the closing prices of a TEPPCO Unit over the ten consecutive trading days immediately preceding the last day of the performance period. In addition, during the performance period, each participant is entitled to cash distributions equal to the product of the number of phantom units outstanding for the participant and the per Unit cash distribution that TEPPCO paid to its unitholders.
At September 30, 2007, a total of 19,700 phantom units were outstanding under the 2000 LTIP, of which 8,400 vest in 2008 and 11,300 vest in 2009. At September 30, 2007, we had accrued liability balances of $0.8 million, for compensation related to the 2000 LTIP.