SHARE-BASED COMPENSATION

3 Months Ended

Sep. 30, 2013

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION

6. 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 three months ended September 30, 2013 and 2012, employees purchased 12,259 shares and 20,595 shares of common stock for approximately $0.8 million and $0.8 million, respectively, under the 2008 ESPP.

Share-Based Award Plans

Stock option activity as of and for the three months ended September 30, 2013 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, 2013	1,170		$	29.60		$	31,391
Granted	—		—
Exercised	(140	)	33.18
Forfeited or expired	(1	)	45.29
Balance outstanding as of September 30, 2013	1,029		$	29.08	3.00	$	44,215
Exercisable as of September 30, 2013	771		$	25.73	2.51	$	35,706

Restricted stock and RSU/ performance stock units (“PSUs”) activity as of and for the three months ended September 30, 2013 is summarized below:

	Restricted Stock		Weighted Average Grant Date Fair Value		RSUsPSUs	Weighted Average Grant Date Fair Value
	(in 000s)		(per share)		(in 000s)	(per share)
Balance outstanding as of June 30, 2013	571		$	43.45	82	$	45.65
Granted	2		60.91		—	—
Vested	(51	)	38.78		—	—
Forfeited or expired	(2	)	47.66		—	—
Balance outstanding as of September 30, 2013	520		$	43.97	82	$	45.65

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 September 30,
	2013		2012
	(in 000s)
Selling, general and administrative	$	2,389	$	1,979
Research and development costs	1,044		1,036
Cost of gaming equipment and systems and gaming operations	29		6
Share-based compensation expense before tax	3,462		3,021
Income tax benefit	1,212		1,057
Net share-based compensation expense	$	2,250	$	1,964

As of September 30, 2013, there was $2.8 million of total unrecognized compensation expense related to the unvested portion of stock options which will be recognized over the subsequent 1.37 years. In addition, as of September 30, 2013, there was $18.0 million of total unrecognized compensation expense related to the unvested portion of restricted stock and RSUs/PSUs which will be recognized over the subsequent 1.75 years.