Long-Term Incentive Plan

We have a long-term incentive plan (“LTIP”) for certain of our employees and for directors of our general partner. The LTIP primarily consists of phantom units and permits the grant of awards covering an aggregate payout of 9.4 million of our limited partner units. The estimated units available under the LTIP at September 30, 2014 total 1.4 million. The compensation committee of our general partner’s board of directors administers our LTIP.

Our equity-based incentive compensation expense was as follows (in thousands):



	Three Months Ended						Nine Months Ended
	September 30, 2013						September 30, 2013
	Equity Method		Liability Method		Total		Equity Method		Liability Method		Total
Performance-based awards:
2010 awards	$	—	$	—	$	—	$	121	$	73	$	194
2011 awards	1,101		717		1,818		4,204		2,940		7,144
2012 awards	856		432		1,288		2,563		1,413		3,976
2013 awards	763		223		986		2,222		610		2,832
Retention awards	125		—		125		353		—		353
Total	$	2,845	$	1,372	$	4,217	$	9,463	$	5,036	$	14,499

Allocation of LTIP expense on our consolidated statements of income:
G&A expense					$	4,126					$	13,928
Operating expense					91						571
Total					$	4,217					$	14,499



	Three Months Ended						Nine Months Ended
	September 30, 2014						September 30, 2014
	Equity Method		Liability Method		Total		Equity Method		Liability Method		Total
Performance/market-based awards:
2012 awards	$	1,022	$	651	$	1,673	$	3,066	$	3,192	$	6,258
2013 awards	1,350		558		1,908		4,726		2,411		7,137
2014 awards	1,101		—		1,101		3,233		—		3,233
Retention awards	296		—		296		1,103		—		1,103
Total	$	3,769	$	1,209	$	4,978	$	12,128	$	5,603	$	17,731

Allocation of LTIP expense on our consolidated statements of income:
G&A expense					$	4,862					$	17,322
Operating expense					116						409
Total					$	4,978					$	17,731

During 2014, 219,282 phantom unit awards were issued pursuant to our LTIP. These grants included both performance-based and retention awards and have a three-year vesting period.

On February 3, 2014, we issued 388,819 limited partner units, of which 387,216 were issued to settle unit award grants to certain employees that vested on December 31, 2013 and 1,603 were issued to settle the equity-based retainer paid to a member of our general partner's board of directors.

Basic and Diluted Net Income Per Limited Partner Unit

The difference between the weighted-average number of limited partner units outstanding used for basic and diluted net income per unit calculations on our consolidated statements of income is the dilutive effect of phantom unit grants associated with our long-term incentive plan.