For stock options, SSARs and non-performance-based RSUs, stock-based compensation expense is recognized on a straight-line basis ratably over the respective vesting periods. For RSUs subject to graded vesting schedules for which vesting is based on achievement of a performance metric in addition to grantee service (performance-based RSUs), stock-based compensation expense is recognized on an accelerated basis by treating each vesting tranche as if it was a separate grant. A summary of the components of stock-based compensation expense recognized during the years ended June 30, 2016, 2015, and 2014, together with the income tax benefits realized, is as follows (in thousands):

	Year ended June 30,
	2016		2015		2014
Stock-based compensation included in indirect costs and selling expense:
Restricted stock and RSU expense	$	17,919	$	14,072	$	11,516
SSARs and non-qualified stock option expense		—		—		41
Total stock-based compensation expense	$	17,919	$	14,072	$	11,557
Income tax benefit recognized for stock-based compensation expense	$	6,476	$	5,260	$	4,392

The Company recognizes the effect of expected forfeitures of equity grants by estimating an expected forfeiture rate for grants of equity instruments. Amounts recognized for expected forfeitures are subsequently adjusted periodically and at major vesting dates to reflect actual forfeitures.

The incremental income tax benefits realized upon the exercise or vesting of equity instruments are reported as operating cash flows. During the years ended June 30, 2016, 2015, and 2014, the Company recognized $1.2 million, $3.5 million, and $4.7 million of excess tax benefits, respectively, which have been reported as operating cash inflows in the accompanying consolidated statements of cash flows.

Under the terms of its 2006 Stock Incentive Plan (the 2006 Plan), the Company may issue, among others, non-qualified stock options, restricted stock, RSUs, SSARs, and performance awards, collectively referred to herein as equity instruments. During the periods presented, all equity instrument grants were made in the form of RSUs. Annual grants under the 2006 Plan are generally made to the Company’s key employees during the first quarter of the Company’s fiscal year and to members of the Company’s Board of Directors during the second quarter of the Company’s fiscal year. With the approval of its Chief Executive Officer, the Company also issues equity instruments to strategic new hires and to employees who have demonstrated superior performance.

In September 2013, the Company made its annual grant to key employees consisting of 202,170 Performance-based Restricted Stock Units (PRSUs). The final number of such PRSUs that will be considered earned by participants and vest is based on the achievement of a specified net after tax profit (NATP) for the year ended June 30, 2014 and on the average share price of Company stock for the 90 day period ending September 13, 2014 as compared to the average share price for the 90 day period ended September 13, 2013. No PRSUs will be earned if the specified NATP for the fiscal year ending June 30, 2014 is not met. If NATP for the year ending June 30, 2014 exceeds the specified NATP and the average share price of the Company’s stock for the 90 day period ending September 13, 2014 exceeds the average share price of the Company’s stock for the 90 day period ended September 13, 2013 by 100 percent or more, then an additional 202,170 RSUs could be earned by participants. This is the maximum number of additional PRSUs that can be earned related to the September 2013 annual grant. The specified NATP for the year ended June 30, 2014 was met. In addition to the performance and market conditions, there is a service vesting condition which stipulates that 50 percent of the earned award will vest on September 1, 2016 and 50 percent of the earned award will vest on September 1, 2017, in both cases dependent upon continuing service by the grantee as an employee of the Company, unless the grantee is eligible for earlier vesting upon retirement, as defined.

In September 2014, the Company made its annual grant to key employees consisting of 180,570 PRSUs. The final number of such PRSUs that are earned by participants and vest is based on the achievement of a specified earnings per share (EPS) for the year ended June 30, 2015 and on the average share price of Company stock for the 90 day period ending September 23, 2015, 2016 and 2017 as compared to the average share price for the 90 day period ended September 23, 2014. The specified EPS for the year ended June 30, 2015 was met and the average share price of the Company’s stock for the 90 day period ending September 23, 2015 exceeded the average share price of the Company’s stock for the 90 day period ended September 23, 2014 resulting in an additional 7,884 RSUs earned by participants.

In September 2015, the Company made its annual grant to its key employees consisting of 208,160 PRSUs. The final number of such performance-based RSUs which will be considered earned by the participants and eventually vest is based on the achievement of a specified earnings per share (EPS) for the year ending June 30, 2016 and on the average share price of Company stock for the 90 day periods ending September 18, 2016, 2017 and 2018 as compared to the average share price for the 90 day period ended September 18, 2015. PRSUs were earned since the specified EPS for the fiscal year ending June 30, 2016 was met. If EPS for the year ending June 30, 2016 exceeds the specified EPS and the average share price of the Company’s stock for the 90 day periods ending September 18, 2016, 2017 and 2018 exceeds the average share price of the Company’s stock for the 90 day period ended September 18, 2015 by 100 percent or more, then an additional 208,160 RSUs could be earned by participants. This is the maximum number of additional RSUs that can be earned related to the September 2015 annual grant. In addition to the performance and market conditions, there is a service vesting condition which stipulates that 50 percent of the earned award will vest on September 18, 2018 and 50 percent of the earned award will vest on September 18, 2019, in both cases dependent upon continuing service by the grantee as an employee of the Company, unless the grantee is eligible for earlier vesting upon retirement or certain other events.

The Company also issues equity instruments in the form of RSUs under its Management Stock Purchase Plan (MSPP) and Director Stock Purchase Plan (DSPP). In addition, annual grants are made to members of the Company’s Board of Directors in the form of a set dollar value of RSUs. Grants to members of the Board of Directors vest based on the passage of time and continued service as a Director of the Company.

Upon the exercise of stock options and SSARs and the vesting of restricted shares and RSUs, the Company fulfills its obligations under the equity instrument agreements by either issuing new shares of authorized common stock or by issuing shares from treasury. The total number of shares authorized by shareholders for grants under the 2006 Plan and its predecessor plan was 12,450,000 as of June 30, 2016. The aggregate number of grants that may be made may exceed this approved amount as forfeited SSARs, stock options, restricted stock and RSUs, and vested but unexercised SSARs and stock options that expire, become available for future grants. As of June 30, 2016, cumulative grants of 13,763,280 equity instruments underlying the shares authorized have been awarded, and 4,213,316 of these instruments have been forfeited.

Equity instruments granted on or after January 1, 2004 have a term of seven years. For SSAR and stock option awards, grantees whose employment has terminated have 60 days after their termination date to exercise vested SSARs and stock options, or they forfeit their right to the instruments. Grantees whose employment is terminated due to death or permanent disability will vest in 100 percent of their equity instrument grants. Also, effective for grants made on or after July 1, 2004, grantees who were age 62 on or before July 1, 2008 who retire on or after age 65 will vest in 100 percent of their equity instrument grants upon retirement, with the exception of performance-based RSUs, which must be held at least until the measurement period is complete. Grantees who were not age 62 on or before July 1, 2008, who retire on or after age 62, vest in a prorated portion of their equity instrument grants upon retirement, based upon their service during the vesting period.

Stock options vest ratably over a three, four, or five year period, depending on the year of grant. Restricted shares and most non-performance-based RSUs vest in full three years from the date of grant. RSUs granted to the Company’s Chief Executive Officer in February 2013 and to the Company’s Chief Operating Officer in February 2012 have longer vesting periods. SSARs granted in prior years as part of the Company’s then customary annual award vest ratably over a five year period in a manner consistent with the vesting of stock options. As of June 30, 2016 all stock options and SSARs are fully vested and exercised.

We account for share-based payments to employees, including grants of employee stock awards and purchases under employee stock purchase plans, in accordance with ASC 718, Compensation—Stock Compensation, which requires that share-based payments (to the extent they are compensatory) be recognized in our consolidated statements of operations based on their fair values. We determine the fair value of our market-based and performance-based RSUs at the date of grant using generally accepted valuation techniques and the closing market price of our stock. The fair value was determined using a Monte Carlo simulation model incorporating the following factors: 90 day average stock price at the grant date of $80.71 a share, risk free rate of return of 0.97 percent, and expected volatility of 19.17 percent. Stock-based compensation cost is recognized as expense on an accelerated basis over the requisite service period for performance based award. Stock-based compensation cost is recognized ratably over the requisite service period for non-performance based awards. The weighted-average fair value of RSUs granted during the years ended June 30, 2016, 2015, and 2014, was $80.72, $76.37, and $72.17, respectively.

No stock options or SSARs were granted during the years ended June 30, 2016, 2015 or 2014. Activity for all outstanding SSARs and stock options, and the corresponding exercise price and fair value information, for the years ended June 30, 2016, 2015, and 2014, is as follows:

	Number of Shares			Exercise Price		Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Outstanding, June 30, 2013		275,550		$37.67 – 59.30		$	48.62		17.54
Exercisable, June 30, 2013		243,170		37.67 – 59.30			48.58		17.60
Exercised		(180,370	)	45.77 – 49.36			48.53		17.81
Forfeited		(1,150	)		49.36		49.36		17.12
Expired		(2,080	)		49.36		49.36		17.12
Outstanding, June 30, 2014		91,950		37.67 – 59.30			48.77		17.02
Exercisable, June 30, 2014		91,950		37.67 – 59.30			48.77		17.02
Exercised		(44,290	)	37.67 – 59.30			49.36		17.33
Forfeited		—			—		—		—
Expired		(5,000	)		47.59		47.59		10.68
Outstanding, June 30, 2015		42,660		37.67 – 49.36			48.29		17.45
Exercisable, June 30, 2015		42,660		37.67 – 49.36			48.29	$	17.45
Exercised		(35,860	)	37.67 – 49.36			48.18		17.25
Forfeited		—			—		—		—
Expired		(6,800	)		48.83		48.83		18.50
Outstanding, June 30, 2016		—			—		—		—
Exercisable, June 30, 2016		—			—	$	—	$	—

Changes in the number of unvested SSARs and stock options and in unvested restricted stock and RSUs during each of the years in the three-year period ended June 30, 2016, 2015, and 2014, together with the corresponding weighted-average fair values, are as follows:

	SSARs and Stock Options					Restricted Stock and Restricted Stock Units
	Number of Shares			Weighted Average Grant Date Fair Value		Number of Shares			Weighted Average Grant Date Fair Value
Unvested at June 30, 2013		32,380		$	17.02		1,042,746		$	47.74
Granted		—			—		254,356			72.17
Vested		(31,230	)		17.02		(360,857	)		45.07
Forfeited		(1,150	)		17.12		(98,003	)		54.94
Unvested at June 30, 2014		—			—		838,242			55.39
Granted		—			—		322,121			76.37
Vested		—			—		(250,613	)		47.84
Forfeited		—			—		(45,184	)		66.89
Unvested at June 30, 2015		—			—		864,566			64.79
Granted		—			—		275,117			80.72
Vested		—			—		(209,448	)		49.48
Forfeited		—			—		(56,381	)		75.79
Unvested at June 30, 2016		—		$	—		873,854		$	71.20

Information regarding the cash proceeds received, and the intrinsic value and total tax benefits realized resulting from SSARs and stock option exercises is as follows (in thousands):

The total intrinsic value of RSUs that vested during the years ended June 30, 2016, 2015, and 2014 was $18.4 million, $18.6 million and $23.1 million, respectively, and the tax benefit realized was $3.3 million, $7.0 million and $8.8 million, respectively.

No stock options vested during the years ended June 30, 2016 and June 30, 2015. The grant date fair value of stock options that vested during period ended June 30, 2014 was $0.5 million.

As of June 30, 2016, there was no unrecognized compensation cost related to SSARs and stock options and $32.2 million of unrecognized compensation cost related to restricted stock and RSUs scheduled to be recognized over a weighted-average period of 2.4 years.

The Company adopted the 2002 Employee Stock Purchase Plan (ESPP), MSPP and DSPP in November 2002, and implemented these plans beginning July 1, 2003. There are 1,250,000, 500,000, and 75,000 shares authorized for grants under the ESPP, MSPP and DSPP, respectively.

The ESPP allows eligible full-time employees to purchase shares of common stock at 95 percent of the fair market value of a share of common stock on the last day of the quarter. The maximum number of shares that an eligible employee can purchase during any quarter is equal to two times an amount determined as follows: 20 percent of such employee’s compensation over the quarter, divided by 95 percent of the fair market value of a share of common stock on the last day of the quarter. The ESPP is a qualified plan under Section 423 of the Internal Revenue Code and, for financial reporting purposes, was amended effective July 1, 2005 so as to be considered non-compensatory. Accordingly, there is no stock-based compensation expense associated with shares acquired under the ESPP. As of June 30, 2016, participants have purchased 1,071,706 shares under the ESPP, at a weighted-average price per share of $49.75. Of these shares, 36,773 were purchased by employees at a weighted-average price per share of $82.60 during the year ended June 30, 2016. During the year ended June 30, 2013, the Company established a 10b5-1 plan to facilitate the open market purchase of shares of Company stock to satisfy its obligations under the ESPP.

The MSPP provides those senior executives with stock holding requirements a mechanism to receive RSUs in lieu of up to 100 percent of their annual bonus. For the fiscal years ended June 30, 2016, 2015, and 2014, RSUs awarded in lieu of bonuses earned are granted at 85 percent of the closing price of a share of the Company’s common stock on the date of the award, as reported by the New York Stock Exchange. RSUs granted under the MSPP vest at the earlier of 1) three years from the grant date, 2) upon a change of control of the Company, 3) upon a participant’s retirement at or after age 65, or 4) upon a participant’s death or permanent disability. Vested RSUs are settled in shares of common stock. The Company recognizes the value of the discount applied to RSUs granted under the MSPP as stock compensation expense ratably over the three-year vesting period.

The DSPP allows directors to elect to receive RSUs at the market price of the Company’s common stock on the date of the award in lieu of up to 100 percent of their annual retainer fees. Vested RSUs are settled in shares of common stock. There were no DSPP awards outstanding during the year ended June 30, 2016.