18. Equity Compensation

We award stock options, time-based restricted stock and performance-based restricted stock units from time to time under the Papa John’s International, Inc. 2011 Omnibus Incentive Plan.

There are approximately 6.6 million shares of common stock authorized for issuance and remaining available under the 2011 Omnibus Incentive Plan as of December 31, 2017. Option awards are granted with an exercise price equal to the market price of the Company’s stock at the date of grant. Options outstanding as of December 31, 2017 generally expire ten years from the date of grant and generally vest over a three-year period.

We recorded stock-based employee compensation expense of $10.4 million in 2017, $10.1 million in 2016 and $9.4 million in 2015. The total related income tax benefit recognized in the consolidated income statement was $3.8 million in 2017, $3.7 million in 2016 and $3.5 million in 2015. At December 31, 2017, there was $8.0 million of unrecognized compensation cost related to nonvested option awards, time-based restricted stock and performance-based restricted stock units, of which the Company expects to recognize $5.9 million in 2018, $1.9 million in 2019 and $200,000 in 2020.

Stock Options

Options exercised, which were issued from authorized shares, included 147,000 shares in 2017, 478,000 shares in 2016 and 441,000 shares in 2015. The total intrinsic value of the options exercised during 2017, 2016 and 2015 was $5.2 million, $18.6 million and $20.3 million, respectively. Cash received upon the exercise of stock options was $6.3 million, $7.1 million and $5.2 million during 2017, 2016 and 2015, respectively, and the related tax benefits realized were approximately $1.9 million, $6.9 million and $7.5 million during the corresponding periods.

Information pertaining to option activity during 2017 is as follows (number of options and aggregate intrinsic value in thousands):


				Weighted
				Average
		Weighted		Remaining
	Number	Average		Contractual	Aggregate
	of	Exercise		Term	Intrinsic
	Options	Price		(In Years)	Value
Outstanding at December 25, 2016	1,316	$	46.58
Granted	315		78.59
Exercised	(147)		42.71
Cancelled	(32)		68.30
Outstanding at December 31, 2017	1,452	$	53.43	7.07	$	13,901
Exercisable at December 31, 2017	800	$	40.72	5.89	$	13,901

The following is a summary of the significant assumptions used in estimating the fair value of options granted in 2017, 2016 and 2015:


	2017		2016		2015

Assumptions (weighted average):
Risk-free interest rate	2.0	%	1.3	%	1.6	%
Expected dividend yield	1.0	%	1.2	%	0.9	%
Expected volatility	26.7	%	27.4	%	28.5	%
Expected term (in years)	5.6		5.5		5.5

The risk-free interest rate for the periods within the contractual life of an option is based on the U.S. Treasury yield curve in effect at the time of grant. The expected dividend yield was estimated as the annual dividend divided by the market price of the Company’s shares on the date of grant. Expected volatility was estimated by using the Company’s historical share price volatility for a period similar to the expected life of the option.

Options granted generally vest in equal installments over three years and expire ten years after grant. The expected term for these options represents the period of time that options granted are expected to be outstanding and was calculated using historical experience.

The weighted average grant-date fair values of options granted during 2017, 2016 and 2015 was $19.88, $13.96 and $16.93, respectively. The Company granted options to purchase 315,000, 403,000 and 330,000 shares in 2017, 2016 and 2015, respectively.

Restricted Stock and Restricted Stock Units

We granted shares of restricted stock that are time-based and generally vest in equal installments over three years (73,000 in 2017, 85,000 in 2016 and 76,000 in 2015). Upon vesting, the shares are issued from treasury stock. These restricted shares are intended to focus participants on our long-range objectives, while at the same time serving as a retention mechanism. We consider time-based restricted stock awards to be participating securities because holders of such shares have non-forfeitable dividend rights. We declared dividends totaling $128,000 ($0.85 per share) in 2017, $117,000 ($0.75 per share) in 2016 and $110,000 ($0.63 per share) in 2015 to holders of time-based restricted stock.

Additionally, we granted stock settled performance-based restricted stock units to executive management (13,000 in 2017, 14,000 in 2016, and 12,000 in 2015). The vesting of these awards (a three-year cliff vest) is dependent upon the Company’s achievement of a compounded annual growth rate of earnings per share and the achievement of certain sales and unit growth metrics. Upon vesting, the shares are issued from authorized shares.

The fair value of both time-based restricted stock and performance-based restricted stock units is based on the market price of the Company’s shares on the grant date. Information pertaining to these awards during 2017 is as follows (shares in thousands):


		Weighted
		Average
		Grant-Date
	Shares	Fair Value
Total as of December 25, 2016	185		59.21
Granted	86		78.52
Incremental Performance Shares*	3		50.59
Forfeited	(7)		69.14
Vested	(86)		56.45
Total as of December 31, 2017	181	$	69.11

* Additional shares from the 2014 performance-based restricted stock unit grant due to exceeding the initial 100% target resulting in a 122% payout.