UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 8, 2010

PAA Natural Gas Storage, L.P.

(Exact name of registrant as specified in its charter)

DELAWARE		1-34722		27-1679071
(State or other jurisdiction of		(Commission File Number)		(IRS Employer Identification No.)
incorporation)

333 Clay Street, Suite 1500, Houston, Texas 77002
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code 713-646-4100

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 5.02		Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

     In connection with the recent election of Don O’Shea to the additional position of Chief Accounting Officer of PAA Natural Gas Storage, L.P. (“PNG”), Mr. O’Shea’s annual salary has been increased to $140,000.

Item 8.01. Other Events.

     On September 9, 2010, Plains All American Pipeline, L.P. (“PAA”) entered into transaction grant agreements with Greg L. Armstrong, Harry N. Pefanis and Al Swanson, pursuant to which these individuals acquired phantom common units, phantom series A subordinated units and phantom series B subordinated units representing a portion of the limited partner interests of PNG issued to PAA in connection with PNG’s IPO. Distribution equivalent rights, payable by PAA in cash, were also granted with respect to the phantom common units and phantom series A subordinated units. The phantom units will vest and be payable as follows: (i) the phantom common units will vest 50% on May 5, 2011 and 50% on May 5, 2012, and be payable one-for-one by PAA in Common Units of PNG; (ii) the phantom series A subordinated units will vest in connection with the conversion of the Series A Subordinated Units into Common Units, and be payable one-for-one by PAA in Common Units of PNG; and (iii) the phantom series B subordinated units will vest in tranches of 20%, 21%, 15%, 22% and 22%, respectively, in connection with the conversion of the First through Fifth Tranches of Series B Subordinated Units. Upon vesting, the phantom series B subordinated units will be payable one-for-one by PAA in Series A Subordinated Units or Common Units of PNG it receives upon conversion of the Series B Subordinated Units. Any phantom series A subordinated units and any phantom series B subordinated units that have not vested as of December 18, 2018 will be automatically cancelled on such date.

     The number of phantom units of each class or series granted by PAA to Messrs. Armstrong, Pefanis and Swanson is set forth below:

						Phantom				Phantom
						Series A				Series B
		Phantom				Subordinated				Subordinated
		Common Units				Units				Units				Total
Greg L. Armstrong			62,000				62,000				62,000				186,000
Harry N. Pefanis			42,000				42,000				42,000				126,000
Al Swanson			21,000				21,000				21,000				63,000

     Terms used but not defined herein have the meanings set forth in the Second Amended and Restated Agreement of Limited Partnership of PNG.

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.