General Description of Share-based Plans

Synovus has a long-term incentive plan under which the Compensation Committee of the Board of Directors has the authority to grant share-based awards to Synovus employees. The 2013 Omnibus Plan authorizes 8.6 million common share equivalents available for grant, where grants of options count as one share equivalent and grants of full value awards (e.g., restricted share units, market restricted share units, and performance share units) count as two share equivalents. Any restricted share units that are forfeited and options that expire unexercised will again become available for issuance under the Plan. At December 31, 2018, Synovus had a total of 4.8 million common share equivalents of its authorized but unissued common stock reserved for future grants under the 2013 Omnibus Plan. The Plan permits grants of share-based compensation including stock options, restricted share units, market restricted share units, and performance share units. The grants generally include vesting periods of three years. The restricted share units and the market restricted share units contain a service-based vesting period of three years with most awards vesting pro-rata over three years. As further discussed below, market restricted share units and performance share units are granted at a defined target level and are compared annually to required market and performance metrics to determine actual units vested and compensation expense. Synovus has historically issued new shares to satisfy share option exercises and share unit conversions. Dividend equivalents are paid on outstanding restricted share units, market restricted share units, and performance share units in the form of additional restricted share units that vest over the same vesting period or the vesting period left on the original restricted share unit grant. The restricted share units and the market restricted share units granted during 2018, 2017, and 2016 contain a service-based vesting period of three years with most awards vesting pro-rata over three years.

Share-based Compensation Expense

Total share-based compensation expense was $16.6 million, $14.2 million, and $13.6 million for 2018, 2017, and 2016, respectively. The total income tax benefit recognized in the consolidated statements of income related to share-based compensation expense was $3.9 million, $5.2 million, and $5.0 million for 2018, 2017, and 2016, respectively. No share-based compensation costs have been capitalized for the years ended December 31, 2018, 2017, and 2016. As of December 31, 2018, unrecognized compensation cost related to the unvested portion of share-based compensation arrangements involving shares of Synovus stock was $20.5 million.

Stock Options

There were no stock option grants in 2018, 2017, or 2016. A summary of stock option activity and changes during the years ended December 31, 2018, 2017, and 2016 is presented below.



Stock Options
	2018				2017				2016
	Shares		Weighted-Average Exercise Price		Shares		Weighted-Average Exercise Price		Shares		Weighted-Average Exercise Price
Outstanding at beginning of year	775,730		$	17.85	973,361		$	17.76	1,741,975		$	37.88
Options exercised	(126,344	)	16.92		(197,631	)	17.41		(297,225	)	17.35
Options forfeited	—		—		—		—		(1,597	)	17.64
Options expired/canceled	(9,485	)	92.26		—		—		(469,792	)	92.62
Options outstanding at end of year	639,901		$	16.93	775,730		$	17.85	973,361		$	17.76
Options exercisable at end of year	639,901		$	16.93	775,730		$	17.85	973,361		$	17.76

The aggregate intrinsic value for outstanding and exercisable stock options at December 31, 2018 was $9.6 million and their weighted average remaining contractual life was 3.36 years years.

The intrinsic value of stock options exercised during the years ended December 31, 2018, 2017, and 2016 was $4.4 million, $5.1 million, and $4.7 million, respectively. Cash received from option exercises of common stock for the years ended December 31, 2018, 2017, and 2016 was $2.1 million, $3.4 million, and $5.2 million, respectively. The total grant date fair value of stock options vested during 2016 was $7.4 million.

Restricted Share Units, Market Restricted Share Units, and Performance Share Units

Compensation expense is measured based on the grant date fair value of restricted share units, market restricted share units, and performance share units. The fair value of restricted share units and performance share units is equal to the market price of common stock on the grant date. The fair value of market restricted share units granted was estimated on the date of grant using a Monte Carlo simulation model with the following weighted average assumptions:



	2018		2017		2016
Risk-free interest rate	2.32	%	1.48	%	0.81	%
Expected stock price volatility	22.5		22.9		25.7
Dividend yield	1.3		1.2		1.8
Simulation period	3.0 years		3.0 years		3.0 years

The stock price expected volatility was based on Synovus' historical and implied volatility. The Monte Carlo model estimates fair value based on 100,000 simulations of future share price using a theoretical model of stock price behavior.

A summary of restricted share units outstanding and changes during the years ended December 31, 2018, 2017, and 2016 is presented below (excluding market restricted and performance share units).



Restricted Share Units
	Share Units		Weighted-Average Grant Date Fair Value
Outstanding at December 31, 2015	762,767		$	24.57
Granted	350,458		26.43
Dividend equivalents granted	11,105		26.43
Vested	(406,496	)	23.10
Forfeited	(12,067	)	23.96
Outstanding at December 31, 2016	705,767		26.38
Granted	242,804		41.82
Dividend equivalents granted	5,839		41.82
Vested	(341,825	)	26.25
Forfeited	(46,637	)	26.28
Outstanding at December 31, 2017	565,948		33.25
Granted	248,697		47.34
Dividend equivalents granted	7,259		44.10
Vested	(280,459	)	30.86
Forfeited	(15,652	)	38.60
Outstanding at December 31, 2018	525,793		$	41.18

The total fair value of restricted share units vested during 2018, 2017, and 2016 was $13.6 million, $14.4 million, and $11.4 million, respectively. As of December 31, 2018, total unrecognized compensation cost related to restricted share units was $11.0 million. This cost is expected to be recognized over a weighted average remaining period of 1.44 years.

Synovus granted market restricted share units to senior management during the years ended December 31, 2018, 2017, and 2016. The market restricted share units have a three-year service-based vesting component as well as a total shareholder return multiplier. The number of market restricted share units that will ultimately vest ranges from 75% to 125% of a defined target based on Synovus' total shareholder return (TSR). The total fair value of market restricted share units vested during 2018, 2017, and 2016 was $5.1 million, $4.8 million, and $2.6 million, respectively. At December 31, 2018, total unrecognized compensation cost related to market restricted share units was $3.4 million with a weighted average remaining period of 1.35 years. A summary of market restricted share units outstanding and changes during the years ended December 31, 2018, 2017, and 2016 is presented below.



Market Restricted Share Units
	Share Units		Weighted-Average Grant Date Fair Value
Outstanding at December 31, 2015	158,248		$	27.02
Granted	93,913		26.93
Dividend equivalents granted	3,095		26.93
Quantity change by TSR factor	9,970		26.93
Vested	(82,817	)	26.40
Outstanding at December 31, 2016	182,409		27.25
Granted	78,174		43.52
Dividend equivalents granted	2,811		43.52
Quantity change by TSR factor	22,182		27.25
Vested	(114,013	)	26.78
Outstanding at December 31, 2017	171,563		35.24
Granted	57,851		48.46
Dividend equivalents granted	3,204		41.91
Quantity change by TSR factor	17,882		33.21
Vested	(105,459	)	33.21
Forfeited	(952	)	38.32
Outstanding at December 31, 2018	144,089		$	41.91

Synovus granted performance share units to senior management during the years ended December 31, 2018, 2017, and 2016. These units vest upon meeting certain service and performance conditions. Beginning in 2018, return on average assets (ROAA) and return on average tangible common equity (ROATCE) performance is evaluated each year over a three-year performance period, with share distribution determined at the end of the three years. The number of performance share units that will ultimately vest ranges from 0% to 150% of defined targets based on Synovus' three-year weighted average ROAA and ROATCE (as defined). Prior to 2018, performance was evaluated using only ROAA. The total fair value of performance share units vested during 2018 was $4.3 million. At December 31, 2018, total unrecognized compensation cost related to performance share units was $6.0 million with a weighted average remaining period of 1.40 years. A summary of performance share units outstanding and changes during the years ended December 31, 2018, 2017, and 2016 is presented below.



Performance Share Units
	Share Units		Weighted-Average Grant Date Fair Value
Outstanding at December 31, 2015	151,567		$	26.01
Granted	83,529		25.95
Dividend equivalents granted	3,384		25.95
Outstanding at December 31, 2016	238,480		25.99
Granted	72,825		41.61
Dividend equivalents granted	2,562		41.61
Vested	(69,326	)	23.47
Outstanding at December 31, 2017	244,541		31.54
Granted	86,774		47.23
Dividend equivalents granted	4,418		28.06
Vested	(84,326	)	28.06
Adjustment for performance vs. target	(1,250	)	28.06
Forfeited	(1,900	)	33.52
Outstanding at December 31, 2018	248,257		$	38.29

Excess tax benefit/deficiency

During 2018, Synovus recognized $3.3 million of income tax benefits through the income statement from share-based compensation excess tax benefits upon the vesting of restricted share units, market restricted share units, performance share units, and exercise of stock options. During 2017, Synovus recognized $5.0 million of income tax benefits through the income statement from share-based compensation excess tax benefits upon the vesting of restricted share units, market restricted share units, performance share units, and exercise of stock options. During 2016, Synovus recognized a share-based compensation net tax deficiency of $790 thousand associated primarily with expired and canceled stock options. The net deficiency was recorded as a reduction of additional paid-in-capital within shareholders' equity.

The following table provides aggregate information regarding grants under all Synovus equity compensation plans at December 31, 2018.



Plan Category	(a) Number of Securities to be Issued Upon Vesting of Restricted Share Units, Market Restricted Share Units, and Performance Share Units⁽¹⁾	(b) Number of Securities to be Issued Upon Exercise of Outstanding Options	(c) Weighted-Average Exercise Price of Outstanding Options in Column (b)		(d) Number of Shares Remaining Available for Issuance Excluding Shares Reflected in Columns (a) and (b)
Shareholder approved equity compensation plans for shares of Synovus stock	918,139	639,901	$	16.93	4,849,161


⁽¹⁾	Market restricted and performance share units included at defined target levels. Actual shares issued upon vesting may differ based on actual TSR and ROAA and ROATCE over the measurement period.

Other Employment Benefit Plans

For the year ended December 31, 2018, Synovus provided a 100% matching contribution on the first 5% of eligible employee 401(k) contributions for a total annual contribution of $15.7 million. For the years ended December 31, 2017 and 2016, Synovus provided a 100% matching contribution on the first 4% of eligible employee 401(k) contributions for a total annual contribution of $11.5 million and $10.8 million, respectively. Effective December 29, 2017, Synovus' non-contributory profit sharing plan was merged into the 401(k) plan.

For the years ended December 31, 2018, 2017, and 2016, Synovus sponsored a stock purchase plan for directors and employees whereby Synovus made contributions equal to 15% of employee and director voluntary contributions, subject to certain maximum contribution limitations. The funds are used to purchase outstanding shares of Synovus common stock. Synovus recorded as expense $942 thousand, $860 thousand, and $826 thousand for contributions to these plans in 2018, 2017, and 2016, resp