This excerpt taken from the TPP 8-K filed Aug 27, 2007.
1999 Phantom Unit Retention Plan
Effective January 1, 1999, we adopted the Texas Eastern Products Pipeline Company, LLC 1999 Phantom Unit Retention Plan (1999 Plan) to provide key employees with incentive awards whereby a participant is granted phantom units. These phantom units are automatically redeemed for cash based on the vested portion of the fair market value of the phantom units at stated redemption dates. The fair market value of each phantom unit is equal to the closing price of a TEPPCO Unit as reported on the NYSE on the redemption date. Each participant is also entitled to quarterly cash distributions equal to the product of the number of phantom units outstanding for the participant and the amount of the cash distribution that TEPPCO paid per Unit to its unitholders.
We accrue compensation expense annually based upon the terms of the 1999 Plan. A total of 31,600 phantom units remain outstanding at June 30, 2007, of which 13,000 vest April 11, 2008, 13,000 vest April 11, 2009 and 5,600 vest January 1, 2010. At June 30, 2007, we had an accrued liability balance of $1.0 million for compensation related to the 1999 Plan.