v3.19.3
Employee Incentive Plans (Tables)
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9 Months Ended |
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| Share-based Payment Arrangement [Abstract] |
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| Schedule of Amounts Recognized in Consolidated Financial Statements |
Amounts recognized on the consolidated financial statements with respect to these plans are as follows (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | Nine Months Ended September 30, | | | | 2019 | | 2018 | | 2019 | | 2018 | | Cost of unit-based compensation charged to operating expense | $ | 2.1 | | | $ | 5.2 | | | $ | 4.5 | | | $ | 9.5 | | | Cost of unit-based compensation charged to general and administrative expense | 10.0 | | | 11.8 | | | 26.5 | | | 22.1 | | | Total unit-based compensation expense | $ | 12.1 | | | $ | 17.0 | | | $ | 31.0 | | | $ | 31.6 | |
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| Summary of Restricted Incentive Unit Activity |
ENLK restricted incentive units were valued at their fair value at the date of grant, which is equal to the market value of ENLK common units on such date. A summary of the restricted incentive unit activity for the nine months ended September 30, 2019 is provided below: | | | | | | | | | | | | | | | | | Nine Months Ended
September 30, 2019 | | | | EnLink Midstream Partners, LP Restricted Incentive Units: | | Number of Units | | Weighted Average Grant-Date Fair Value | | Non-vested, beginning of period | | 2,556,270 | | | $ | 14.43 | | | | | | | | Vested (1) | | (722,853) | | | 10.02 | | | Forfeited | | (4,490) | | | 11.93 | | | Converted to ENLC (2) | | (1,828,927) | | | 16.11 | | | Non-vested, end of period | | — | | | $ | — | | | | | | |
____________________________ (1)Vested units included 249,201 units withheld for payroll taxes paid on behalf of employees. (2)As a result of the Merger, the Legacy ENLK Awards converted into ENLC unit-based awards using the 1.15 exchange ratio (as defined in the Merger Agreement) as the conversion rate.
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| Summary of Restricted Units' Aggregate Intrinsic Value |
A summary of the restricted incentive units’ aggregate intrinsic value (market value at vesting date) and fair value of units vested (market value at date of grant) for the three and nine months ended September 30, 2019 and 2018 is provided below (in millions). Since the Legacy ENLK Awards converted into ENLC unit-based awards as a result of the Merger, no additional restricted incentive units will vest as ENLK units under the GP Plan (such restricted incentive units, as converted, are eligible to vest as ENLC units) and no additional expense will be recognized after January 25, 2019 under the GP Plan. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | Nine Months Ended September 30, | | | | EnLink Midstream Partners, LP Restricted Incentive Units: | | 2019 | | 2018 | | 2019 | | 2018 | | Aggregate intrinsic value of units vested | | $ | — | | | $ | 3.7 | | | $ | 8.0 | | | $ | 12.8 | | | Fair value of units vested | | $ | — | | | $ | 2.8 | | | $ | 7.2 | | | $ | 16.1 | |
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| Summary of Performance Units |
The following table presents a summary of the performance units: | | | | | | | | | | | | | | | | | | Nine Months Ended
September 30, 2019 | | | | EnLink Midstream Partners, LP Performance Units: | | Number of Units | | Weighted Average Grant-Date Fair Value | | Non-vested, beginning of period | | 451,669 | | | $ | 17.74 | | | | | | | | Vested (1) | | (161,410) | | | 10.54 | | | | | | | | Converted to ENLC (2) | | (290,259) | | | 28.31 | | | Non-vested, end of period | | — | | | $ | — | | | | | | |
____________________________ (1)Vested units included 62,403 units withheld for payroll taxes paid on behalf of employees. (2)As a result of the Merger, the performance-based Legacy ENLK Awards converted into ENLC unit-based performance awards using the 1.15 exchange ratio (as defined in the Merger Agreement) as the conversion rate. A summary of the performance units’ aggregate intrinsic value (market value at vesting date) and fair value of units vested (market value at date of grant) for the three and nine months ended September 30, 2019 and 2018 is provided below (in millions). Since the Legacy ENLK Awards converted into ENLC unit-based awards as a result of the Merger, no additional performance units will vest as ENLK units under the GP Plan (such performance units, as converted, are eligible to vest as ENLC units) and no additional expense will be recognized after January 25, 2019 under the GP Plan. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | Nine Months Ended September 30, | | | | EnLink Midstream Partners, LP Performance Units: | | 2019 | | 2018 | | 2019 | | 2018 | | Aggregate intrinsic value of units vested | | $ | — | | | $ | 3.0 | | | $ | 2.1 | | | $ | 5.0 | | | Fair value of units vested | | $ | — | | | $ | 3.6 | | | $ | 1.7 | | | $ | 7.7 | |
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| Schedule Of Performance Stock Vesting Levels |
The following table sets out the levels at which the Tranche TSR Units may vest (using linear interpolation) based on the ENLC TSR percentile ranking for the applicable performance period relative to the TSR achievement of the Designated Peer Companies: | | | | | | | | | | | | | | | | Performance Level | | Achieved ENLC TSR
Position Relative to Designated Peer Companies | | Vesting percentage
of the Tranche TSR Units | | Below Threshold | | Less than 25% | | 0% | | | Threshold | | Equal to 25% | | 50% | | | Target | | Equal to 50% | | 100% | | | Maximum | | Greater than or Equal to 75% | | 200% | |
Approximately one-third of the Total CF Units (the “Tranche CF Units”) relates to each of the first three performance periods described above (i.e., the Cash Flow performance goal does not relate to the Cumulative Performance Period). The Board will establish the Cash Flow performance targets for purposes of the column in the table below titled “ENLC’s Achieved Cash Flow” for each performance period no later than March 31 of the year in which the relevant performance period begins. Following the end date of a given performance period, the Committee will measure and determine the Cash Flow performance of ENLC to determine the Tranche CF Units that are eligible to vest, subject to the grantee’s continued employment or service with ENLC or its affiliates through the end of the Cumulative Performance Period. In short, the Performance-Based Award Agreement defines Cash Flow for a given performance period as (A)(i) ENLC’s adjusted EBITDA minus (ii) interest expense, current taxes and other, maintenance capital expenditures, and preferred unit accrued distributions divided by (B) the time-weighted average number of ENLC’s common units outstanding during the relevant performance period. The following table sets out the levels at which the Tranche CF Units will be eligible to vest (using linear interpolation) based on the Cash Flow performance of ENLC for the performance period ending December 31, 2019:
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of the Tranche CF Units | | Below Threshold | | Less than $1.43 | | 0% | | | Threshold | | Equal to $1.43 | | 50% | | | Target | | Equal to $1.55 | | 100% | | | Maximum | | Greater than or Equal to $1.72 | | 200% | |
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| Summary of Grant-Date Fair Values |
The following table presents a summary of the grant-date fair value assumptions by performance unit grant date: | | | | | | | | | | | | | | | | EnLink Midstream, LLC Performance Units: | | June 2019 | | March 2019 | | Grant-Date Fair Value | | $ | 9.92 | | | $ | 13.10 | | | Beginning TSR price | | $ | 9.84 | | | $ | 10.92 | | | Risk-free interest rate | | 1.72 | % | | 2.42 | % | | Volatility factor | | 33.50 | % | | 33.86 | % | | Distribution yield | | 11.5 | % | | 9.7 | % |
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| Schedule Of Nonvested Performance Based Units Activity1 |
The following table presents a summary of the performance units: | | | | | | | | | | | | | | | | | | Nine Months Ended
September 30, 2019 | | | | EnLink Midstream, LLC Performance Units: | | Number of Units | | Weighted Average Grant-Date Fair Value | | Non-vested, beginning of period | | 418,149 | | | $ | 19.15 | | | Granted | | 931,469 | | | 13.02 | | | Vested (1) | | (374,745) | | | 21.08 | | | Forfeited | | (309,603) | | | 15.28 | | | Converted from ENLK (2) | | 333,798 | | | 25.84 | | | Non-vested, end of period | | 999,068 | | | $ | 16.15 | | | Aggregate intrinsic value, end of period (in millions) | | $ | 8.5 | | | |
____________________________ (1)Vested units included 146,218 units withheld for payroll taxes paid on behalf of employees. (2)As a result of the Merger, the performance-based Legacy ENLK Awards converted into ENLC performance-based awards using the 1.15 exchange ratio (as defined in the Merger Agreement) as the conversion rate.
A summary of the performance units’ aggregate intrinsic value (market value at vesting date) and fair value of units vested (market value at date of grant) for the three and nine months ended September 30, 2019 and 2018 is provided below (in millions). | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | Nine Months Ended September 30, | | | | EnLink Midstream, LLC Performance Units: | | 2019 | | 2018 | | 2019 | | 2018 | | Aggregate intrinsic value of units vested | | $ | 1.6 | | | $ | 2.8 | | | $ | 3.4 | | | $ | 4.7 | | | Fair value of units vested | | $ | 6.0 | | | $ | 3.5 | | | $ | 7.9 | | | $ | 7.7 | |
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| Schedule Of Share-based Compensation, Restricted Stock And Restricted Stock Units, Vested And Fair Value Vested1 |
A summary of the restricted incentive units’ aggregate intrinsic value (market value at vesting date) and fair value of units vested (market value at date of grant) for the three and nine months ended September 30, 2019 and 2018 is provided below (in millions): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | | | Nine Months Ended September 30, | | | | EnLink Midstream, LLC Restricted Incentive Units: | | 2019 | | 2018 | | 2019 | | 2018 | | Aggregate intrinsic value of units vested | | $ | 3.1 | | | $ | 3.3 | | | $ | 16.0 | | | $ | 12.6 | | | Fair value of units vested | | $ | 5.8 | | | $ | 2.6 | | | $ | 18.9 | | | $ | 16.1 | |
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| Schedule Of Nonvested Restricted Stock Units Activity1 |
ENLC restricted incentive units are valued at their fair value at the date of grant, which is equal to the market value of ENLC common units on such date. A summary of the restricted incentive unit activity for the nine months ended September 30, 2019 is provided below: | | | | | | | | | | | | | | | | | | Nine Months Ended
September 30, 2019 | | | | EnLink Midstream, LLC Restricted Incentive Units: | | Number of Units | | Weighted Average Grant-Date Fair Value | | Non-vested, beginning of period | | 2,425,867 | | | $ | 14.62 | | | Granted (1) | | 1,875,490 | | | 11.39 | | | Vested (1)(2) | | (1,632,100) | | | 11.55 | | | Forfeited | | (488,913) | | | 14.39 | | | Converted from ENLK (3) | | 2,103,266 | | | 14.01 | | | Non-vested, end of period | | 4,283,610 | | | $ | 14.10 | | | Aggregate intrinsic value, end of period (in millions) | | $ | 36.4 | | | |
____________________________ (1)Restricted incentive units typically vest at the end of three years. In March 2019, ENLC granted 420,842 restricted incentive units with a fair value of $4.8 million to officers and certain employees as bonus payments for 2018, and these restricted incentive units vested immediately and are included in the restricted incentive units granted and vested line items. (2)Vested units included 563,606 units withheld for payroll taxes paid on behalf of employees. (3)Represents Legacy ENLK Awards that were converted into ENLC unit-based awards using the 1.15 exchange ratio (as defined in the Merger Agreement) as the conversion rate.
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