COMMON STOCK AND SHARE-BASED COMPENSATION

Cash Dividends — In November 2013, we announced that our Board of Directors had adopted a cash dividend policy. Under the policy, holders of our common stock will receive dividends when and as declared by our Board of Directors. Pursuant to the policy, we paid quarterly dividends of $0.07 per share ($0.28 per share annually) in March, June, September and December of 2014 and 2015. Beginning in 2015, all awards of restricted stock units and phantom stock awards provide for cash dividend equivalent units ("DEUs"), which vest in cash at the same time as the underlying award. Annual dividend payments totaled approximately $26 million for each of the years ended December 31, 2015 and 2014, respectively.

Our authorized shares of capital stock include one million shares of preferred stock and 250 million shares of common stock with a par value of $0.01 per share.

Conversion of Equity Awards Outstanding at Spin-Off Date — At the date of the WhiteWave spin-off, certain of our outstanding Dean Foods stock options and unvested restricted stock units (“RSUs”) held by WhiteWave employees were converted to equivalent options or RSUs, as applicable, with respect to WhiteWave’s common stock. These modified awards otherwise retained substantially the same terms and conditions, including term and vesting provisions, as the existing Dean Foods equity awards had at the time of conversion. We will not incur any future compensation cost related to conversion of our outstanding Dean Foods stock options and RSUs held by WhiteWave employees and directors in connection with the WhiteWave spin-off.

Additionally, in connection with the WhiteWave spin-off, we proportionately adjusted the number and exercise prices of certain options, RSUs and phantom shares granted to Dean Foods employees and directors that were outstanding at the time of the WhiteWave spin-off to maintain the aggregate intrinsic value of such awards at the date of the WhiteWave spin-off, pursuant to the terms of these awards. The conversion ratio was determined based on the 5-day volume weighted-average trading prices for Dean Foods common stock and WhiteWave common stock for the period ended on the second trading day preceding the WhiteWave spin-off and, therefore, the ratio used to adjust these awards differs from the conversion ratio that would have resulted had the ratio been calculated based on the Dean Foods stock price immediately following the WhiteWave spin-off. As a result of this modification, we recorded additional stock compensation expense of $6.7 million during the year ended December 31, 2013.

The impact of the conversion on our outstanding equity awards, and the related share-based compensation expense, is summarized in the tables below.

Stock Repurchases — Since 1998, our Board of Directors has from time to time authorized the repurchase of our common stock up to an aggregate of $2.38 billion (excluding fees and expenses), of which approximately $222.1 million remained available under this program as of December 31, 2015. Our management is authorized to purchase shares from time to time through open market transactions at prevailing prices or in privately-negotiated transactions, subject to market conditions and other factors. Shares, when repurchased, are retired. We will continue to evaluate opportunities for share repurchases in a strategic manner as a mechanism for generating additional shareholder value.

The following table summarizes the share repurchase activity for the years ended (in thousands, except per share data):



	2015		2014
Number of shares repurchased	3,166		1,727
Weighted average purchase price per share	$16.73		$14.45
Amount of share repurchases	$	53,010	$	25,000

Stock Award Plans — Under our stock award plans, we grant stock options and RSUs to certain employees and directors. Non-employee directors also can elect to receive certain director’s fees in the form of restricted stock in lieu of cash. As of December 31, 2015, we had three award plans with remaining shares available for issuance. These plans, which are our 1997 Stock Option and Restricted Stock Plan, the 1989 Dean Foods Company Stock Awards Plan (which we adopted upon completion of our acquisition of Legacy Dean) and the Dean Foods Company 2007 Stock Incentive Plan (the “2007 Plan”) provide for grants of stock options, stock units, restricted stock and other stock-based awards to employees, officers, directors and, in some cases, consultants, up to a maximum of 37.5 million, 5.7 million and 12.3 million shares, respectively, subject to adjustments as provided in these respective plans. Options and other stock-based awards vest in accordance with provisions set forth in the applicable award agreements. The remaining shares available for grant under the historical plans are granted pursuant to the terms and conditions of the 2007 Plan. On May 15, 2013, the 2007 Plan was amended and changed from one under which limits were placed on the number of shares that could be granted with respect to awards other than stock options and stock appreciation rights (“Full Value Awards”) to one under which all authorized shares may be granted from a “fungible” share pool. Pursuant to the 2007 Plan, as amended, each share subject to any Full Value Award that is granted from the pool of available shares will count against the amended 2007 Plan’s share authorization as though 1.67 shares of the Company’s stock had been awarded. As of December 31, 2015, we had approximately 9.81 million shares, in the aggregate, available in the fungible share pool for issuance.

Stock Options — We did not grant any stock options during 2013, 2014 or 2015, nor do we plan to in 2016. At December 31, 2015, there was no remaining unrecognized stock option expense related to unvested awards.

Under the terms of our stock option plans, employees and non-employee directors may be granted options to purchase our stock at a price equal to the market price on the date the option is granted.

Prior to 2014, we did not historically declare or pay a regular cash dividend on our common stock. Stock option awards are not impacted by our decision in 2013 to begin paying dividends in 2014.

The following table summarizes stock option activity during the year ended December 31, 2015:



	Options		Weighted Average Exercise Price		Weighted Average Contractual Life	Aggregate Intrinsic Value
Options outstanding at January 1, 2015	3,691,567		$	20.13
Forfeited and canceled(1)	(342,227	)	22.41
Exercised	(144,415	)	16.29
Options outstanding and exercisable at December 31, 2015(2)	3,204,925		20.07		2.10	$	3,615,768
Options exercisable at December 31, 2014	3,605,028		20.35


(1)	Pursuant to the terms of our stock option plans, options that are forfeited or canceled may be available for future grants. Effective May 15, 2013, any stock options surrendered or canceled in satisfaction of participants' exercise proceeds or tax withholding obligation will no longer become available for future grants under the plans.


(2)	As of December 31, 2015, there were no remaining unvested stock options.

The following table summarizes information about options outstanding and exercisable at December 31, 2015:



	Options Outstanding and Exercisable
Range of Exercise Prices	Number Outstanding	Weighted- Average Remaining Contractual Life (in years)	Weighted- Average Exercise Price
$8.96 to 10.44	386,758	5.74	$	9.85
12.60 to 16.98	258,812	3.92	14.08
17.36	474,321	3.12	17.36
17.48	4,504	3.17	17.48
18.22 to 21.96	489,664	1.75	21.83
22.22	767,497	0.04	22.22
23.08	249,539	1.85	23.08
23.56 to 26.06	489,694	1.12	26.02
26.52	22,822	1.16	26.52
27.58 to 27.60	61,314	1.48	27.58

The following table summarizes additional information regarding our stock option activity (in thousands):



	Year Ended December 31
	2015		2014		2013
Intrinsic value of options exercised	$	336	$	2,078	$	9,540
Fair value of shares vested	453		4,717		4,084
Tax benefit related to stock option expense	34		169		2,534

During the year ended December 31, 2015, net cash received from stock option exercises was $2.2 million and the total cash benefit for tax deductions to be realized for these option exercises was $0.1 million.

Restricted Stock Units — We issue RSUs to certain senior employees and non-employee directors as part of our long-term incentive program. An RSU represents the right to receive one share of common stock in the future. RSUs have no exercise price. RSUs granted to employees generally vest ratably over three years, subject to certain accelerated vesting provisions based primarily on a change of control, or in certain cases upon death or qualified disability. RSUs granted to non-employee directors vest ratably over three years.

The following table summarizes RSU activity during the year ended December 31, 2015:



	Employees			Directors			Total
RSUs outstanding January 1, 2015	898,550			112,579			1,011,129
RSUs issued	397,502			46,589			444,091
Shares issued upon vesting	(277,461		)	(62,723		)	(340,184		)
RSUs canceled or forfeited(1)	(146,715		)	(1,629		)	(148,344		)
RSUs outstanding at December 31, 2015	871,876			94,816			966,692
Weighted-average per share grant date fair value	$	15.48		$	15.12		$	15.45


(1)	Pursuant to the terms of our stock unit plans, employees have the option of forfeiting stock units to cover their minimum statutory tax withholding when shares are issued. Any stock units surrendered or canceled in satisfaction of participants’ tax withholding obligations are not available for future grants under the plans.

The following table summarizes information about our RSU grants and RSU expense during the years ended December 31, 2015, 2014 and 2013 (in thousands, except per share amounts):



	Year Ended December 31
	2015		2014		2013
Total intrinsic value of RSUs vested/distributed during the period	$	7,958	$	5,459	$	7,419
Weighted-average grant date fair value of RSUs granted	16.41		14.62		15.45
Tax benefit related to RSU expense	2,303		990		1,493

At December 31, 2015, there was $10.2 million of total unrecognized RSU expense, all of which is related to unvested awards. This compensation expense is expected to be recognized over the weighted-average remaining vesting period of 0.96 years.

Restricted Stock — We offer our non-employee directors the option to receive certain compensation for services rendered in either cash or shares of restricted stock equal to 150% of the fee amount. Shares of restricted stock vest one-third on grant, one-third on the first anniversary of grant and one-third on the second anniversary of grant. The following table summarizes restricted stock activity during the year ended December 31, 2015:



	Shares		Weighted- Average Grant Date Fair Value
Unvested at January 1, 2015	39,234		$	17.82
Restricted shares granted	38,962		16.41
Restricted shares vested	(38,871	)	17.88
Unvested at December 31, 2015	39,325		$	16.36

Phantom Shares — We grant phantom shares as part of our long-term incentive compensation program, which are similar to RSUs in that they are based on the price of our stock and vest ratably over a three-year period, but are cash-settled based upon the value of our stock at each vesting period. The fair value of the awards is remeasured at each reporting period. Compensation expense, which is variable, is recognized over the vesting period with a corresponding liability, which is recorded in accounts payable and accrued expenses in our Consolidated Balance Sheets. The following table summarizes the phantom share activity during the year ended December 31, 2015:



	Shares		Weighted- Average Grant Date Fair Value
Outstanding at January 1, 2015	1,036,331		$	15.91
Granted	724,289		16.30
Converted/paid	(503,334	)	16.44
Forfeited	(97,767	)	15.75
Outstanding at December 31, 2015	1,159,519		$	15.94

Share-Based Compensation Expense — The following table summarizes the share-based compensation expense related to Dean Foods equity-based awards recognized during the years ended December 31, 2015, 2014 and 2013 (in thousands):



	Year Ended December 31
	2015		2014		2013(1)
Stock options	$	88	$	438	$	6,520
Stock units	8,407		4,521		5,114
Phantom shares	7,882		7,317		7,654
Total	$	16,377	$	12,276	$	19,288


(1)	The share-based compensation expense recorded during the year ended December 31, 2013 includes additional compensation expense of $5.7 million for stock options and $1.0 million for stock units related to the conversion of equity awards described more fully above.