Business Context and Reporting Period
This Form 8-K was filed by NGL Energy Partners LP on March 30, 2015. The report details the approval of long-term incentive grants to named executive officers by the Compensation Committee of NGL Energy Holdings LLC, the General Partner of the registrant.
Key Financial Metrics
The filing text does not provide a clear value for revenue, profit, cash flow, margins, debt, or liquidity. This report focuses exclusively on executive compensation arrangements.
Material Changes
On March 30, 2015, the Compensation Committee approved two types of unvested common unit grants:
- Service Awards: Contingent only on continued service through specified vesting dates.
- Performance Awards: Contingent on continued service and the performance of NGL's common units relative to the Alerian MLP Index.
Total unvested Service Awards (including prior grants) held by named executive officers as of the filing date are:
| Officer Name | Total Unvested Service Awards |
|---|---|
| Atanas H. Atanasov | 46,000 |
| James J. Burke | 55,000 |
| Shawn W. Coady | 45,000 |
Guidance, Outlook, and Compensation Structure
Performance Award Vesting: Performance Awards vest in three tranches on July 1, 2016; July 1, 2017; and July 1, 2018. The performance periods run from July 1, 2015, through June 30 of the respective vesting years.
Vesting Conditions: The number of Performance Award units vesting ranges from 0% to 200% of the Service Award units held by the officer for the same vesting date. Vesting percentages are determined by the percentage of entities in the Alerian MLP Index that NGL outperforms:
- Less than 50% outperformance: 0% vesting.
- 50% - 75% outperformance: 50% - 100% vesting.
- 75% - 100% outperformance: 100% - 200% vesting.
Investor Verification Checklist
- Verify the specific number of Performance Award units granted to each officer, as the filing only defines the vesting formula relative to Service Awards.
- Monitor NGL's stock performance relative to the Alerian MLP Index to determine potential vesting outcomes for the 2016, 2017, and 2018 tranches.
- Review subsequent filings for any changes to the long-term incentive plan or executive departures that would affect vesting.