Company: CAPL
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0000950170-25-028082
Chunk: 171

Company: CrossAmerica Partners LP
Filing Date: 2025-02-27
Form: 10-K
Item: Item 1B
Chunk 171
---
2025, conditioned upon continuous service as non-employee directors. These awards were accompanied by tandem distribution equivalent rights that entitle the holder to cash payments equal to the amount of unit distributions authorized to be paid to the holders of our common units.During the fourth quarter of 2024, the Partnership granted 33,061 phantom units to employees of the Topper Group. Of these awards, 50% vest ratably over three years through December 31, 2027 and 50% vest upon the employee’s death, disability or retirement. These awards were accompanied by tandem distribution equivalent rights that entitle the holder to cash payments equal to the amount of unit distributions authorized to be paid to the holders of our common units.Performance-Based AwardsDuring the fourth quarter of 2024, the Partnership granted performance-based awards with an initial target value of $0.9 million. The performance-based awards vest on December 31, 2027, based on attainment of the performance goals set forth in the award agreements. The performance-based awards are weighted 50% for the increase of funds flow from operations per unit (as defined in the award agreements) and 50% for leverage (as defined in the award agreements), with a performance period from January 1, 2025 to December 31, 2027 and with a reference period ending on December 31, 2024. The payout value for both performance conditions will be interpolated on a linear basis ranging from 0% to 200%, which will then be multiplied by the initial target value to determine the value of the units to be issued. The value of the units will then be divided by the 20-day volume-weighted average closing price of our common units as of a date shortly before the conversion date to determine the actual number of units to be issued.OverallSince we grant awards to employees of the Topper Group who provide services to us under the Omnibus Agreement and non-employee directors of the Board, and since the grants may be settled in cash at the discretion of our Board, unvested phantom units and unvested performance-based awards receive fair value variable accounting treatment. As such, they are measured at fair value at each balance sheet reporting date and the cumulative compensation cost recognized is classified as a liability, which is included in accrued expenses and other current liabilities on the consolidated balance sheet. In measuring the cumulative compensation cost with regard to the performance-based awards, we also reassess the probability of the performance conditions being met each balance sheet date. The balance