TESORO LOGISTICS LP NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAM
EX-10.9 2 tllpex1096302013.htm EXHIBIT 10.9 TLLP EX.10.9 6.30.2013
Exhibit 10.9
TESORO LOGISTICS LP
NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAM
In July 2013, the Board of Directors of our general partner adopted changes to the director compensation program under which our general partner's non-employee directors are compensated for their service as directors. The changes to the compensation program will become effective October 1, 2013. Each non-employee director receives a compensation package consisting of an annual retainer, an additional retainer for service as the chair of a standing committee and meeting attendance fees and may also receive grants of equity-based awards upon appointment to the Board of Directors. The annual retainer was increased by $16,000, with the new amounts shown below. In addition, the retainer for serving as the Chair of the Audit Committee or the Conflicts Committee was increased by $5,000.
Non-Employee Director Annual Retainers and Fees (a)
Board of Directors Annual Retainer (b) | $ | 121,000 | |
Annual Retainer for Audit and Conflicts Committee Chairs | 15,000 | ||
Board and Committee Meeting Fees (c) | 1,500 per meeting | ||
(a) | In addition to the retainers set forth above, we reimburse our non-employee directors for travel and lodging expenses that they incur in connection with attending meetings of the board of directors or its committees. |
(b) | Beginning October 1, 2013, the annual retainer is payable $58,000 in cash and $63,000 in an award of service phantom units. Unit-based awards granted to non-employee directors under the annual compensation package or upon first election to the board of directors under our long-term incentive plan, vest one year from the date of grant, contingent on continued service by the director. Cash distribution equivalent rights accrue with respect to equity-based awards and are distributed at the time such awards vest. The number of units granted will be determined by dividing $63,000 by the average closing price of our common units on the NYSE over a ten business-day period ending on the third business day prior to the grant date and rounding any resulting fractional units to the nearest whole unit. The plan provides that unit-based awards to directors will be granted annually in conjunction with the Board's approval of our Annual Report on Form 10-K, and that any new non-employee director will receive a pro rata award of service phantom units when commencing his or her services as a board member. Because the unit-based awards are granted annually and the annual compensation was increased effective October 1, 2013, each of our non-employee directors will receive an incremental grant of units valued at $2000 (rounded up to the next whole unit) effective October 1, 2013 for the service during the fourth quarter of the calendar year. |
(c) | A meeting fee is paid to a non-employee director for attendance in person or by telephone. |
