NOTE 13: STOCK-RELATED BENEFIT PLANS

New York Community Bank Employee Stock Ownership Plan

All full-time employees who have attained 21 years of age and have completed twelve consecutive months of credited service are eligible to participate in the Employee Stock Ownership Plan (“ESOP”), with benefits vesting on a seven-year basis, starting with 20% in the third year of employment and continuing in 20% increments in each successive year. Benefits are payable upon death, retirement, disability, or separation from service, and may be paid in stock. However, in the event of a change in control, as defined in the ESOP, any unvested portion of benefits shall vest immediately.

In 2015, 2014, and 2013, the Company allocated 552,829; 560,228; and 505,354 shares, respectively, to participants in the ESOP. For the years ended December 31, 2015, 2014, and 2013, the Company recorded ESOP-related compensation expense of $9.2 million, $8.8 million, and $8.5 million, respectively.

Supplemental Executive Retirement Plan

In 1993, the Community Bank established a Supplemental Executive Retirement Plan (“SERP”), which provided additional unfunded, non-qualified benefits to certain participants in the ESOP in the form of Company common stock. The SERP was frozen in 1999. Trust-held assets, consisting entirely of Company common stock, amounted to 1,653,737 and 1,560,294 shares at December 31, 2015 and 2014, respectively. The cost of these shares is reflected as a reduction of paid-in capital in excess of par in the Consolidated Statements of Condition.

Stock Incentive and Stock Option Plans

At December 31, 2015, the Company had a total of 12,233,512 shares available for grants as options, restricted stock, or other forms of related rights under the New York Community Bancorp, Inc. 2012 Stock Incentive Plan (the “2012 Stock Incentive Plan”), which was approved by the Company’s shareholders at its Annual Meeting on June 7, 2012. Included in this amount were 1,030,673 shares that were transferred from the 2006 Stock Incentive Plan, which was approved by the Company’s shareholders at its Annual Meeting on June 7, 2006 and reapproved at its Annual Meeting on June 2, 2011. The Company granted 2,352,641 shares of restricted stock during the twelve months ended December 31, 2015, with an average fair value of $15.83 per share on the date of grant. During 2014 and 2013, the Company granted 2,377,498 shares and 2,327,522 shares, respectively, of restricted stock, which had average fair values of $16.79 and $13.64 per share on the respective grant dates. The shares of restricted stock that were granted during the years ended December 31, 2015, 2014, and 2013 vest over a period of five years. Compensation and benefits expense related to the restricted stock grants is recognized on a straight-line basis over the vesting period, and totaled $30.2 million, $27.5 million, and $22.2 million, respectively, for the years ended December 31, 2015, 2014, and 2013.

The following table provides a summary of activity with regard to restricted stock awards in the year ended December 31, 2015:


	For the Year Ended December 31, 2015
	Number of Shares			Weighted Average Grant Date Fair Value
Unvested at beginning of year		5,802,409			$15.24
Granted		2,352,641			15.83
Vested		(1,660,633	)		15.29
Cancelled		(132,300	)		15.28

Unvested at end of year		6,362,117			15.44

As of December 31, 2015, unrecognized compensation cost relating to unvested restricted stock totaled $70.9 million. This amount will be recognized over a remaining weighted average period of 2.9 years.

In addition, the Company had one stock option plan at December 31, 2015: the 2004 Synergy Financial Group Stock Option Plan (the “Stock Option Plan”). All stock options granted under the Stock Option Plan expire ten years from the date of grant.

The Company uses the modified prospective approach to recognize compensation costs related to share-based payments at fair value on the date of grant, and recognizes such costs in the financial statements over the vesting period during which the employee provides service in exchange for the award. As there were no unvested options at any time during 2015, 2014, or 2013, the Company did not record any compensation and benefits expense relating to stock options during those years.

To satisfy the exercise of options, the Company either issues new shares of common stock or uses common stock held in Treasury. In the event that Treasury stock is used, the difference between the average cost of Treasury shares and the exercise price is recorded as an adjustment to retained earnings or paid-in capital on the date of exercise. At December 31, 2015, 2014, and 2013, respectively, there were 2,400; 58,560; and 126,821 stock options outstanding. There were no shares available for future issuance under the Stock Option Plan at December 31, 2015.

The status of the Stock Option Plan at December 31, 2015, and the changes that occurred during the year ended at that date, are summarized below:


	For the Year Ended December 31, 2015
	Number of Stock Options			Weighted Average Exercise Price
Stock options outstanding, beginning of year		58,560			$18.04
Exercised		—			—
Expired/forfeited		(56,160	)		18.09

Stock options outstanding, end of year		2,400			16.88
Options exercisable at year-end		2,400			16.88

The stock options outstanding and exercisable at December 31, 2015 had no intrinsic value, and no options were exercised during the twelve months ended at that date. The intrinsic values of options exercised during the twelve months ended December 31, 2014 and 2013 were $132,000 and $106,000, respectively.