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Note 13 - Long-term Incentive Plan

12 Months Ended

Dec. 31, 2021

Share-based Payment Arrangement [Text Block]

13.	LONG-TERM INCENTIVE PLAN

In July 2007, the general partner adopted the LTIP, which is administered by the compensation committee of the Board. The Partnership’s unitholders have approved 8.1 million common units to be reserved for issuance under the incentive plan, subject to adjustment for certain events. Although other types of awards are contemplated under the LTIP, currently outstanding awards include “phantom” units, which convey the right to receive common units upon vesting, and “restricted” units, which are grants of common units restricted until the time of vesting. The phantom unit awards also include DERs.

Subject to applicable earning criteria, a DER entitles the grantee to a cash payment equal to the cash distribution paid on an outstanding common unit prior to the vesting date of the underlying award. Recipients of restricted and phantom units are entitled to receive cash distributions paid on common units during the vesting period which are reflected initially as a reduction of partners’ capital. Distributions paid on units that ultimately do not vest are reclassified as compensation expense. Awards granted to date are equity awards and, accordingly, the fair value of the awards as of the grant date is expensed over the vesting period.

Each year, restricted common units are granted to the independent directors. The directors may receive units that do have vesting requirements and units that do not have vesting requirements. In December 2021, the directors received 21,228 units with a grant date fair value of $3.26 per unit and a total grant date fair value of $0.1 million, that do not have a vesting requirement. In December 2019, 2020, and 2021, the directors also received units that vest in one-third increments over three years. The following table includes information on outstanding grants made to the directors under the LTIP subject to vesting requirements:

			*Weighted Average*		*Grant Date Total Fair*
	*Number of*		*Grant Date Fair*		*Value*
Grant Date	*Units*		*Value*		(in thousands)
December 2019		7,500	$	1.07	$	8
December 2020		7,500	$	2.06	$	15
December 2021		22,743	$	3.26	$	74

The Partnership also grants phantom units to employees. These grants are equity awards under ASC 718 – Stock Compensation and, accordingly, the fair value of the awards as of the grant date is expensed over the vesting period. The following table includes information on the outstanding grants:

			*Weighted Average*		*Grant Date Total Fair*
	*Number of*		*Grant Date Fair*		*Value*
Grant Date	*Units*		*Value*		(in thousands)
March 2019		524,997	$	1.14	$	598
June 2019		46,168	$	1.08	$	50
March 2020		600,396	$	0.90	$	540
October 2020		16,339	$	1.53	$	25
March 2021		530,435	$	2.71	$	1,437

Compensation expense for the equity awards is calculated as the number of unit awards less forfeitures, multiplied by the grant date fair value of those awards. The Partnership estimates forfeiture rates based on historical forfeitures under the LTIP. The unrecognized estimated compensation cost relating to outstanding phantom and restricted units at December 31, 2021 was $1.1 million, which will be recognized over the remaining vesting period. On January 1, 2022, 426,297 units of the March 2019 grant vested.

The Partnership’s equity-based incentive compensation expense for each of the years ended December 31, 2020 and 2021, was $0.8 million.

Activity pertaining to phantom common units and restricted common unit awards granted under the LTIP is as follows:

	*Number of*		*Grant Date Fair*
	*Units*		*Value*
Nonvested, December 31, 2020		1,350,366	$	1.81
Granted		574,406		2.75
Vested		369,482		4.00
Forfeited		-		-
Nonvested, December 31, 2021		1,555,290	$	1.66