NOTE 12 NET INCOME (LOSS) PER COMMON UNIT

Net income (loss) per common unit is computed by dividing net income attributable to controlling interests, after deduction of amounts attributable to the General Partner and to TransCanada and its subsidiaries, by the weighted average number of common units outstanding.

The amounts allocable to the General Partner equals an amount based upon the General Partner's effective two percent general partner interest, plus an amount equal to incentive distributions. Incentive distributions are paid to the General Partner if quarterly cash distributions on the common units exceed levels specified in the Partnership Agreement (refer to Note 13).

The amounts allocable to TransCanada and its subsidiaries represents amount allocable to the Class B units (refer to Note 6-2015 GTN Acquisition) and amounts allocable to GTN and Bison's former parent as a result of recast (refer to Note 6- 2013 Acquisition).

The amount allocable to GTN and Bison's former parent represents income of GTN and Bison prior to the 2013 Acquisition.

The amount allocable to the Class B units in 2015 equals an amount based upon 30 percent of GTN's distributable cash flow during the nine months ended December 31, 2015 less $15 million.

Net income (loss) per common unit was determined as follows:

(millions of dollars, except per common unit amounts)	2015		2014	2013(a)

Net income allocable to controlling interests	13		172	155
Net income attributable to GTN's and Bison's former parent	–		–	26	(b)

Net income allocable to General and Limited Partners(b)	13		172	129
Incentive distributions attributable to the General Partner(c)	3		1	–
Net income attributable to the Class B units(d)	12		–	–

Net income (loss) allocable to the General Partner and common units	(2	)	171	129
Net Income (loss) allocable to the General Partner's two percent interest	–		3	3

Net income (loss) attributable to common units	(2	)	168	126

Weighted average common units outstanding (millions) – basic and diluted	63.9		62.7	58.9
Net income (loss) per common unit – basic and diluted	$ (0.03	)	$ 2.67	$ 2.13


(a)	Recast as discussed in Note 2 and Note 6.
(b)	Net income allocable to General and Limited Partners excludes net income attributed to GTN's and Bison's former parent as it was allocated to TransCanada and was not allocable to either the general partner, common units or Class B units (refer to Note 6 – 2013 Acquisition).
(c)	Net income allocable to General and Limited Partners is allocated based on their respective participation rights, after giving effect to any priority income allocation for incentive distributions that are allocated 100 percent to the General Partner. Under the terms of the Partnership Agreement, for any quarterly period, the participation of the IDRs is limited to the available cash distributions declared. Accordingly, incentive distributions allocated to the General Partner was based from the Partnership's available cash during the current reporting period, but declared and paid in the subsequent reporting period.
(d)	As discussed in Notes 6 and 9, the Class B units entitle TransCanada to a distribution which is an amount based on 30 percent of GTN's distributions after achieving certain annual thresholds. The distribution will be payable in the first quarter with respect to the prior year's distributions. Consistent with the application of Accounting Standards Codification (ASC) Topic 260 – "Earnings per share," the Partnership allocated a portion of net income attributable to controlling interests to the Class B units upon 30 percent of GTN's total distributable cash flows exceeding $15 million for the nine month period ended December 31, 2015. During the nine months ended December 31, 2015, 30 percent of GTN's total distributable cash flow was $27 million. As a result, $12 million of net income attributable to controlling interests was allocated to the Class B units in 2015. On February 12, 2016, this amount was paid to TransCanada (Refer to Note 13 and 22).