SHARE-BASED COMPENSATION

9 Months Ended

Mar. 31, 2012

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

5.             SHARE-BASED COMPENSATION

Employee Stock Purchase Plan

The 2008 Employee Stock Purchase Plan (the “2008 ESPP”) provides that eligible employees are able to contribute up to 10% of their eligible earnings towards the quarterly purchase of the Company’s common stock. The employee’s purchase price is equal to 85% of the fair market value. During the nine months ended March 31, 2012 and 2011, employees purchased 59,907 shares and 51,570 shares of common stock for approximately $1.9 million and $1.6 million, respectively, under the 2008 ESPP.

Share-Based Award Plans

Stock option activity as of and for the nine months ended March 31, 2012 is summarized below:

			Weighted Average
	Shares		Exercise Price		Remaining Contractual Term	Aggregate Intrinsic Value
	(in 000s)		(per share)		(years)	(in 000s)
Balance outstanding as of June 30, 2011	3,682		$	24.45		$	60,558
Granted	75		36.69
Exercised	(882	)	19.48
Forfeited or expired	(51	)	36.14
Balance outstanding as of March 31, 2012	2,824		$	26.11	3.22	$	58,359
Exercisable as of March 31, 2012	2,126		$	23.11	2.62	$	50,346

Restricted stock and RSU activity as of and for the nine months ended March 31, 2012 is summarized below:

	Restricted Stock		Weighted Average Grant Date Fair Value		RSUs		Weighted Average Grant Date Fair Value
	(in 000s)		(per share)		(in 000s)		(per share)
Balance outstanding as of June 30, 2011	337		$	38.42	600		$	18.92
Granted	217		39.11		—		—
Vested	(99	)	40.67		(30	)	42.01
Forfeited or expired	(4	)	37.98		—		—
Balance outstanding as of March 31, 2012	451		$	38.26	570		$	17.69
Vested as of March 31, 2012.					534		$	16.04

Share-Based Compensation

The following table presents share-based compensation expense and related effect of the income tax benefit included in the Company’s unaudited condensed consolidated statements of operations:

	Three Months Ended March 31,				Nine Months Ended March 31,
	2012		2011		2012		2011
	(in 000s)
Selling, general and administrative	$	2,655	$	2,250	$	7,808	$	7,132
Research and development costs	989		661		3,011		2,338
Cost of gaming equipment and systems and gaming operations	60		43		167		130
Share-based compensation expense before tax	3,704		2,954		10,986		9,600
Income tax benefit	1,296		1,034		3,845		3,360
Net share-based compensation expense	$	2,408	$	1,920	$	7,141	$	6,240

As of March 31, 2012, there was $7.9 million of total unrecognized compensation expense related to the unvested portion of stock options which will be recognized over the subsequent 1.73 years. In addition, as of March 31, 2012, there was $13.5 million of total unrecognized compensation expense related to the unvested portion of restricted stock and RSUs which will be recognized over the subsequent 1.87 years.