Energy Transfer 2015 Annual Report Download - page 136

Table of Contents
The SXL Compensation Committee approved a cash bonus relating to the 2015 calendar year to Mr. Hennigan in the amount of $856,152, representing a
payout at his target bonus amount based on Sunoco Logistics 100% pool funding under the SXL Bonus Plan.
In approving the 2015 bonuses of the named executive officers, the ETE Compensation Committee, the ETP Compensation Committee and the SXL
Compensation Committee took into account the achievement by the respective partnerships of all of the targeted performance objectives for 2015 and the
individual performances of each of the named executive officers, as well as the Longnecker study results. With respect to the award of the Special Bonus to
Mr. Mason, the ETE Compensation Committee took into consideration the factors enumerated as well as the achievement by ETE of all of the targeted
performance objectives for 2015, his individual performance and the Longnecker study. The cash bonuses awarded to each of the executive officers for 2015
performance were consistent with their applicable bonus pool targets.
. ETP currently has three incentive plans: (i) the Amended and Restated Energy Transfer Partners, L.P. 2004 Unit Plan (as amended and
restated as of June 27, 2007, the “2004 Unit Plan”), (ii) 2008 Incentive Plan and (iii) the Energy Transfer Partners, L.P. Amended and Restated 2011 Long-
Term Incentive Plan (the “2011 Incentive Plan”). Each of the 2004 Unit Plan, 2008 Incentive Plan and 2011 Incentive Plan authorizes the ETP Compensation
Committee, in its discretion, to grant awards of restricted units, phantom units, unit options and other awards related to our units upon such terms and
conditions as it may determine appropriate and in accordance with general guidelines as defined by each such plan. The ETP Compensation Committee
determined and/or approved the terms of the unit grants awarded to our named executive officers, including the number of Common Units subject to the
restricted unit award and the vesting structure of those restricted unit awards. All of the awards granted to the named executive officers under these equity
incentive plans have consisted of restricted unit awards that are subject to vesting over a specified time period. Upon vesting of any restricted unit award,
ETP Common Units are issued. During 2015, Mr. Hennigan participated in the Sunoco Partners LLC Long-Term Incentive Plan, as amended, (the “Sunoco
Logistics Plan”) under which restricted units are awarded, such restricted units have the same vesting terms as awards under the 2008 Incentive Plan.
For 2015, in connection with the Longnecker study, the ETP Compensation Committee in July 2015, approved increased targets for each of the named
executive officers. Mr. McCrea’s annual long-term incentive target increased from 750% of his annual base salary to 900% of his base salary. In the cases of
Messrs. Long and Mason, their annual long-term incentive targets increased to 400% and 500% of their annual base salary, respectively; from their previous
levels of 300% and 400%, respectively. Mr. Ramsey’s target of 600% was approved by the ETP Compensation Committee and set by his initial offer letter.
The SXL Compensation Committee, in consultation with the General Partner, increased Mr. Hennigan’s annual long-term target from 500% of his annual
base salary to 600% of his base salary in consideration of the Longnecker study.
In December 2015, the ETP Compensation Committee approved grants of restricted unit awards to Messrs. McCrea, Ramsey, Long and Mason of 123,507
units, 77,190 units, 18,525 units and 29,155 units, respectively, under the 2008 Incentive Plan related to ETP Common Units. As described below in the
section titled “Subsidiary Equity Awards,” for 2015, in discussions between the ETE Compensation Committee and ETP Compensation Committees, as well
as, the SXL Compensation Committee and the compensation committees of the general partners of Sunoco LP, it was determined that portions of total long-
term incentive award target values of Messrs. McCrea, Long and Mason would be composed of restricted units awarded under the 2008 Incentive Plan as well
as restricted/ restricted phantom units under the equity incentive plans of Sunoco Logistics and Sunoco LP in consideration for their roles and
responsibilities at those partnerships.
For Mr. McCrea, his total 2015 total long-term incentive awards were allocated approximately 2/3 to the 2008 Incentive Plan and 1/3 to the Sunoco Logistics
Plan. At Sunoco Logistics, Mr. McCrea serves as Chairman of the Board of Sunoco Logistics’ general partner. For Mr. Mason, his total 2015 long-term awards
were allocated 50% to the 2008 Incentive Plan, 25% to Sunoco Logistics Plan and 25% to the Sunoco LP equity plan. Mr. Mason serves on the board of
Sunoco Logistics and as a legal advisor in matters related to mergers and acquisitions and financing activities to both Sunoco Logistics and Sunoco LP. For
Mr. Long, his total 2015 long-term awards were allocated 50% to the 2008 Incentive Plan, 20% to the Sunoco Logistics Plan and 30% to the Sunoco LP
equity plan. Mr. Long serves as a financial advisor in matters related to mergers and acquisitions and financing activities to both Sunoco Logistics and
Sunoco LP.
It is expected that future long-term incentive awards to the named executive officers of the Partnership and ETE will recognize a similar aggregation of
restricted/phantom restricted units under long-term incentive plans of the Partnership, Sunoco Logistics and/or Sunoco LP, as applicable. The terms and
conditions of the restricted unit awards to Messrs. McCrea, Long and Mason under the Sunoco Logistics and Sunoco LP equity incentive plans are identical
to the terms and conditions of the restricted unit awards under the 2008 Incentive Plan applicable to Messrs. McCrea, Long and Mason.
The restricted unit awards provide for vesting over a five-year period, with 60% vesting at the end of the third year and the remaining 40% vesting at the end
of the fifth year, generally subject to continued employment through each specified vesting date. The restricted unit awards entitle the recipients of the
restricted unit awards to receive, with respect to each ETP Common Unit
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