PARTNERS' EQUITY

6 Months Ended

Jun. 30, 2018

PARTNERS' EQUITY

PARTNERS' EQUITY

NOTE 8   PARTNERS’ EQUITY

ATM equity issuance program (ATM program)

During the six months ended June 30, 2018, we issued 0.7 million common units under our ATM program (none during the three months ended June 30, 2018) generating net proceeds of approximately $39 million, plus $1 million contributed by the General Partner to maintain its effective two percent general partner interest. The commissions to our sales agents in the six months ended June 30, 2018 were nil. The net proceeds were used for general partnership purposes.

Class B units issued to TransCanada

The Class B Units issued on April 1, 2015 to finance a portion of the 2015 GTN Acquisition represent a limited partner interest in us and entitle TransCanada to an annual distribution based on 30 percent of GTN’s annual distributions as follows: (i) 100 percent of distributions above $20 million through March 31, 2020; and (ii) 25 percent of distributions above $20 million thereafter. Additionally, the Class B distribution will be further reduced by the percentage by which distributions payable to the common units is reduced for the calendar year (Class B Reduction).

For the year ending December 31, 2018, the Class B units’ equity account will be increased by the excess of 30 percent of GTN’s distributions less the annual threshold of $20 million and the Class B Reduction and until such amount is declared for distribution and paid in the first quarter of 2019. During the six months ended June 30, 2018, the threshold was not exceeded.

For the year ended December 31, 2017, the Class B distribution was $15 million and was declared and paid in the first quarter of 2018.