Sunoco 2012 Annual Report Download - page 88

Capital Contributions
In July 2011, the Partnership issued 3.9 million Class A Units to Sunoco in connection with the acquisition
of the Eagle Point tank farm and related assets (Note 3). As this transaction was between related parties,
accounting guidance required the issuance to be recorded at the net of Sunoco’s historical carrying value of the
assets acquired ($22 million) and the $2 million cash consideration paid. The $20 million of deferred distribution
units were a new class of units that were converted to common units in July 2012. Prior to their conversion, the
Class A units participated in the allocation of net income on a pro-rata basis with the common units. In
connection with this transaction, the general partner contributed $2 million to the Partnership. The Partnership
recorded this amount as a capital contribution to Equity within its consolidated balance sheet.
In August 2010, the Partnership completed a public offering of 6.0 million limited partnership units. As a
result of this offering, the general partner contributed $3 million to the Partnership to maintain its two percent
general partner interest. The Partnership recorded this amount as a capital contribution to Equity within its
consolidated balance sheet.
During 2012, 2011 and 2010, the Partnership issued 0.5, 0.2 and 0.2 million limited partnership units,
respectively, to participants in the Sunoco Partners LLC Long-Term Incentive Plan upon completion of award
vesting requirements. As a result of these issuances of limited partnership units, the general partner contributed
less than $0.5 million in each period to the Partnership to maintain its two percent general partner interest. The
Partnership recorded these amounts as capital contributions to Equity within its consolidated balance sheets.
5. Net Income Attributable to Sunoco Logistics Partners L.P. Per Limited Partner Unit Data
The general partner’s interest in net income attributable to SXL consists of its two percent general partner
interest and “incentive distributions,” which are increasing percentages, up to 50 percent of quarterly
distributions in excess of $0.1667 per limited partner unit (Note 13). The general partner was allocated net
income attributable to SXL of $24 million (representing 17 percent of total net income attributable to SXL) for
the period from October 5, 2012 to December 31, 2012, $55 million (representing 14 percent of total net income
attributable to SXL) for the period from January 1, 2012 to October 4, 2012, $54 million (representing 17 percent
of total net income attributable to SXL) for the year ended December 31, 2011, and $48 million (representing 14
percent of total net income attributable to SXL) for the year ended December 31, 2010. Diluted net income
attributable to SXL per limited partner unit is calculated by dividing net income attributable to SXL by the sum
of the weighted average number of common units and Class A units outstanding, prior to conversion to common
units (Note 12), and the dilutive effect of incentive unit awards (Note 14).
The following table sets forth the reconciliation of the weighted average number of limited partner units
used to compute basic net income attributable to SXL per limited partner unit to those used to compute diluted
net income attributable to SXL per limited partner unit for the periods presented:
Successor Predecessor
Period from Acquisition
(October 5, 2012) to
December 31, 2012
Period from
January 1, 2012 to
October 4, 2012
Year Ended December 31,
2011 2010
(in millions) (in millions)
Weighted average number of limited
partner units outstanding—basic ...... 103.8 103.5 101.3 95.2
Add effect of dilutive incentive awards . . . 0.3 0.4 0.5 0.5
Weighted average number of limited
partner units—diluted ............... 104.1 103.9 101.8 95.7
On December 2, 2011, the Partnership completed a three-for-one split of its common and Class A units. The
unit split resulted in the issuance of two additional common or Class A units for every one unit owned. All unit
and per unit information included in this report are presented on a post-split basis.
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