Note 17. Share-Based Payment Arrangements

The Company maintains incentive compensation plans that incorporate share-based payment arrangements for associates and directors. The current plan under which share-based awards may be granted, the 2014 Long Term Incentive Plan (the “2014 Plan”), was approved by the Company’s stockholders at the 2014 annual meeting as a successor to the Company’s 2005 Long-Term Incentive Plan (the “2005 Plan”). Certain share-based awards remain outstanding under the 2005 Plan and prior equity incentive compensation plans, but no future awards may be granted thereunder.

The Compensation Committee of the Company’s Board of Directors administers the equity incentive plans, makes determinations with respect to participation by employees or directors and authorizes the share-based awards. Under the 2014 Plan, participants may be awarded stock options (including incentive stock options for associates), restricted shares, performance stock awards and stock appreciation rights, all on a stand-alone, combination or tandem basis. To date, the Committee has awarded stock options, tenure-based restricted shares and performance stock awards under the 2014 Plan and the prior equity incentive plans.

During the year ended December 31, 2017, the Company’s shareholders approved a 1,200,000 increase in the aggregate number of awards that may be granted under the 2014 Plan. Future awards may be granted for the issuance of an aggregate of 2,996,357 shares of the Company’s common stock, plus the number of any shares of the Company’s common stock for which awards under the 2005 Plan are cancelled, expired, forfeited or settled in cash. The 2014 Plan limits the number of shares for which awards may be granted to any participant during any calendar year to 100,000 shares. The Company may use authorized unissued shares or shares held in treasury to satisfy awards under the 2014 Plan.

As of December 31, 2018 there were 1.1 million shares available for future issuance under the 2014 equity compensation plan.

For the years ended December 31, 2018, 2017 and 2016, total share-based compensation recognized in income was $19.8 million, $17.6 million and $14.3 million, respectively. The total recognized tax benefit related to the share-based compensation was $5.8 million, $13.3 million and $5.2 million for 2018, 2017 and 2016, respectively.

A summary of stock option activity for 2018 is presented below:



Options	Number of Shares	Weighted- Average Exercise Price ($)		Weighted- Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value ($000)
Outstanding at January 1, 2018	88,301	$	34.84	2.8	$	1,294
Exercised	(35,317)		37.39			592
Expired	(6,119)		42.82			10
Outstanding at December 31, 2018	46,865	$	31.88	2.6	$	164
Exercisable at December 31, 2018	46,685	$	31.88	2.6	$	164

The exercise price for stock options is set at the closing market price of the Company’s stock on the date immediately preceding the date of grant, except for the exercise price of certain options granted to major stockholders which is set at 110% of the market price. Option awards generally vest equally over five years of continuous service and have ten-year contractual terms.

The total intrinsic value of options exercised during 2018 was $0.6 million. The total intrinsic value of options exercised during 2017 and 2016 was $4.3 million, and $0.5 million, respectively.

A summary of the Company’s nonvested restricted and performance shares for the year ended December 31, 2018 is presented below:



	Number of Shares	Weighted- Average Grant-Date Fair Value ($)
Nonvested at January 1, 2018	1,708,942	$	37.05
Granted	647,376		39.70
Vested	(792,084)		33.94
Cancelled/Forfeited	(70,193)		36.13
Nonvested at December 31, 2018	1,494,041	$	39.89

As of December 31, 2018, there was $54.3 million of total unrecognized compensation expense related to nonvested restricted and performance shares expected to vest. This compensation is expected to be recognized in expense over a weighted-average period of 3.5 years. The total fair value of shares which vested during 2018 and 2017 was $26.2 million and $26.3 million, respectively.

In 2018, the Company granted 26,147 performance shares subject to a total shareholder return (“TSR”) performance metric with a grant date fair value of $51.13 per share and 26,147 performance shares subject to a core earnings per share performance metric with a grant date fair value of $44.84 per share to key members of executive management. The number of performance shares subject to TSR that ultimately vest at the end of the three-year performance period, if any, will be based on the relative rank of the Company’s three-year TSR among the TSRs of a peer group of 43 regional banks. The fair value of the performance shares subject to TSR at the grant date was determined using a Monte Carlo simulated method. The number of performance shares subject to core earnings per share that ultimately vest will be based on the Company’s attainment of certain core earnings per share goals over the two-year performance period. The maximum number of performance shares that could vest is 200% of the target award. Compensation expense for these performance shares will be recognized on a straight-line basis over the three-year service period.