Energy Transfer 2015 Annual Report Download - page 139

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Incentive Plan or as applicable the equity incentive plan of Sunoco Logistics and Sunoco LP, the awards would immediately and fully vest all unvested
restricted unit awards in the event of a change of control, as defined in the applicable plan. Please refer to “Compensation Tables – Potential Payments Upon
a Termination or Change of Control” for additional information.
In addition, our General Partner has also adopted the ETP GP Severance Plan and Summary Plan Description effective as of June 12, 2013, (the “Severance
Plan”), which provides for payment of certain severance benefits in the event of Qualifying Termination (as that term is defined in the Severance Plan). In
general, the Severance Plan provides payment of two weeks of annual base salary for each year or partial year of employment service with the Partnership up
to a maximum of fifty-two weeks or one year of annual base salary (with a minimum of four weeks of annual base salary) and up to three months of continued
group health insurance coverage. The Severance Plan also provides that the Partnership may determine to pay benefits in addition to those provided under
the Severance Plan based on special circumstances, which additional benefits shall be unique and non-precedent setting. The Severance Plan is available to
all salaried employees on a nondiscriminatory basis; therefore, amounts that would be payable to our named executive officers upon a Qualified Termination
have been excluded from “Compensation Tables – Potential Payments Upon a Termination or Change of Control” below.
. We maintain a deferred compensation plan (“DC Plan”), which permits eligible highly compensated employees to defer a
portion of their salary and/or bonus until retirement or termination of employment or other designated distribution. Under the DC Plan, each year eligible
employees are permitted to make an irrevocable election to defer up to 50% of their annual base salary, 50% of their quarterly non-vested unit distribution
income, and/or 50% of their discretionary performance bonus compensation to be earned for services performed during the following year. Pursuant to the DC
Plan, ETP may make annual discretionary matching contributions to participants’ accounts; however, we have not made any discretionary contributions to
participants’ accounts and currently have no plans to make any discretionary contributions to participants’ accounts. All amounts credited under the DC Plan
(other than discretionary credits) are immediately 100% vested. Participant accounts are credited with deemed earnings or losses based on hypothetical
investment fund choices made by the participants among available funds.
Participants may elect to have their accounts distributed in one lump sum payment or in annual installments over a period of three or five years upon
retirement, and in a lump sum upon other termination. Participants may also elect to take lump-sum in-service withdrawals five years or longer in the future,
and such scheduled in-service withdrawals may be further deferred prior to the withdrawal date. Upon a change in control (as defined in the DC Plan) of ETP,
all DC Plan accounts are immediately vested in full. However, distributions are not accelerated and, instead, are made in accordance with the DC Plan’s
normal distribution provisions unless a participant has elected to receive a change of control distribution pursuant to his deferral agreement.
The ETP Deferred Compensation Plan for Former Sunoco Executives (“Sunoco DC Plan”)
is a deferred compensation plan established by ETP in connection with the ETP’s acquisition of Sunoco Logistics. In 2012, Mr. Hennigan waived any future
rights or benefits to which he otherwise would have been entitled under both the Sunoco, Inc. Executive Retirement Plan (“SERP”), a non-qualified,
unfunded plan that provided supplemental pension benefits over and above the benefits under the Sunoco, Inc. Retirement Plan (“SCIRP”), a qualified
defined benefit plan sponsored by Sunoco, Inc., under which benefits are subject to IRS limits for pay and amount, and Sunoco Logistics’ pension restoration
plan, in return for which, $2,789,413 of such deferred compensation benefits was credited to Mr. Hennigan's account under this plan. Mr. Hennigan is our
only executive officer eligible to participate in the Sunoco DC Plan. Mr. Hennigan's account is 100 percent vested and will be distributed in one lump sum
payment upon his retirement or termination of employment, or other designated distribution event, including a change of control (as defined in the Sunoco
DC Plan). His account is credited with deemed earnings (or losses) based on hypothetical investment fund choices made by him among available funds.
We believe our compensation plans and programs for our named executive officers, as well as our
other employees, are appropriately structured and are not reasonably likely to result in material risk to the Partnership. We believe our compensation plans
and programs are structured in a manner that does not promote excessive risk-taking that could harm our value or reward poor judgment. We also believe we
have allocated our compensation among base salary and short and long-term compensation in such a way as to not encourage excessive risk-taking. In
particular, we generally do not adjust base annual salaries for the executive officers and other employees significantly from year to year, and therefore the
annual base salary of our employees is not generally impacted by our overall financial performance or the financial performance of an operating segment. We
generally determine whether, and to what extent, our named executive officers receive a cash bonus based on our achievement of specified financial
performance objectives as well as the individual contributions of our named executive officers to the Partnership’s success. We use restricted units rather than
unit options for equity awards because restricted units retain value even in a depressed market so that employees are less likely to take unreasonable risks to
get, or keep, options “in-the-money.” Finally, the time-based vesting over five years for our long-term incentive awards ensures that our employees’ interests
align with those of our Unitholders for the long-term performance of the Partnership.
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