Share-Based Compensation

The Corporation maintains share-based compensation plans under which it periodically grants share-based awards for a fixed number of shares to certain officers of the Corporation. The fair value of share-based awards is recognized as compensation expense over the requisite service or performance period. During the three months ended March 31, 2018 and 2017, share-based compensation expense related to share-based awards totaled $1.7 million and $3.8 million, respectively. The excess tax benefit realized from share-based compensation transactions during the three months ended March 31, 2018 and 2017 was $1.4 million and $6.1 million, respectively.

During the three months ended March 31, 2018, the Corporation granted 275,355 restricted stock units to certain officers of the Corporation.

On April 26, 2017, the shareholders of the Corporation approved the Stock Incentive Plan of 2017, which provides for 1,750,000 shares of the Corporation's common stock to be made available for future equity-based awards and canceled the amount of shares available for future grant under prior share-based compensation plans. At March 31, 2018, there were 1,346,965 shares of common stock available for future grants under the Stock Incentive Plan of 2017.

Stock Options

The Corporation issues stock options to certain officers from time to time. The exercise price on stock options equals the current market price of the Corporation's common stock on the date of grant and stock options expire ten years from the date of grant. Stock options granted after 2012 vest ratably over a five-year period. Stock options granted prior to 2013 generally vest ratably over a three-year period. Stock options granted prior to August 31, 2016 fully vested upon the merger with Talmer. Stock options assumed by the Corporation in the merger with Talmer Bancorp, Inc. on August 31, 2016 were fully vested prior to assumption.

A summary of activity for the Corporation’s stock options as of and for the three months ended March 31, 2018 is presented below:



	Non-Vested Stock Options Outstanding						Stock Options Outstanding
	Number of Options		Weighted- Average Exercise Price Per Share		Weighted- Average Grant Date Fair Value Per Share		Number of Options		Weighted- Average Exercise Price Per Share
Outstanding at December 31, 2017	330,870		$	37.97	$	7.09	1,110,918		$	29.56
Exercised	—		—		—		(186,434	)	20.24
Vested	(77,388	)	37.01		6.93		—		—
Outstanding at March 31, 2018	253,482		$	38.26	$	7.14	924,484		$	31.44
Exercisable/vested at March 31, 2018							671,002		$	28.86

The weighted-average remaining contractual terms were 6.5 years for all outstanding stock options and 5.9 years for exercisable stock options at March 31, 2018. The intrinsic value of all outstanding in-the-money stock options and exercisable in-the-money stock options was $21.5 million and $17.3 million, respectively, at March 31, 2018. The aggregate intrinsic values of outstanding and exercisable options at March 31, 2018 were calculated based on the closing market price of the Corporation’s common stock on March 31, 2018 of $54.68 per share less the exercise price. Options with intrinsic values less than zero, or "out-of-the-money" options, are not included in the aggregate intrinsic value reported. The total intrinsic value of stock options as of March 31, 2017 was $29.0 million.

Total cash received from options exercises during the three months ended March 31, 2018 and 2017 was $0.9 million and $0.9 million, respectively, resulting in the issuance of 100,885 shares and 496,000 shares, respectively.

At March 31, 2018, unrecognized compensation expense related to stock options totaled $1.8 million and is expected to be recognized over a remaining weighted average period of 3.3 years.

Restricted Stock Units

The Corporation grants Performance-Based Restricted Stock Units ("PRSUs") and Time-Based Restricted Stock Units ("TRSUs") (collectively referred to as "RSUs") to certain officers from time to time. The PRSUs vest based on the Corporation achieving certain performance target levels and the grantee completing the requisite service period. The PRSUs are eligible to vest from 0.5x to 1.5x the number of units originally granted depending on which, if any, of the performance target levels are met. However, if the minimum performance target levels are not achieved, no shares will become vested or be issued for that respective year’s PRSUs. The TRSUs vest upon satisfaction of a service condition. Upon achievement of the performance target level and/or satisfaction of a service condition, as applicable, the RSUs are converted into shares of the Corporation’s common stock on a one-to-one basis. Compensation expense related to RSUs is recognized over the expected requisite performance or service period, as applicable.

A summary of the activity for RSUs as of and for the three months ended March 31, 2018 is presented below:



	Number of Units		Weighted-average grant date fair value per unit
Outstanding at December 31, 2017	380,940		$	41.29
Granted	275,355		54.28
Converted into shares of common stock	(61,342	)	27.87
Outstanding at March 31, 2018	594,953		$	48.68

At March 31, 2018, unrecognized compensation expense related to RSUs totaled $21.9 million and is expected to be recognized over a remaining weighted average period of 3.6 years.

Restricted Stock Awards

The Corporation assumed restricted stock awards in the merger with Talmer Bancorp, Inc. that vest upon completion of future service requirements. The fair value of these awards is equal to the market price of the Corporation's common stock at the date the awards were assumed with the portion of the fair value related to post-combination service. The Corporation recognizes stock-based compensation expense over the vesting period, using the straight-lined method, based upon the number of shares of restricted stock ultimately expected to vest. If an individual awarded restricted stock awards terminates employment prior to the end of the vesting period, the unvested portion of the stock is forfeited, with certain exceptions.

The following table provides information regarding nonvested restricted stock awards:



Nonvested restricted stock awards	Number of Awards		Weighted-average acquisition-date fair value
Nonvested at January 1, 2018	83,228		$	46.23
Vested	(41,614	)	46.23
Nonvested at March 31, 2018	41,614		$	46.23

At March 31, 2018, unrecognized compensation expense related to nonvested restricted stock awards totaled $1.7 million and is expected to be recognized over a remaining weighted average period of 0.9 years.