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Stock-Based Compensation
 3 Months Ended
Sep. 30, 2012
Stock-Based Compensation [Abstract]  
Stock-Based Compensation

7. Stock-Based Compensation

Stock-based compensation expense recognized, together with the income tax benefits recognized, is as follows (in thousands):

  Three Months Ended
  September 30,
    2012   2011
Stock-based compensation included in indirect costs and selling expenses:        
Restricted stock and restricted stock unit (RSU) expense $ 2,154 $ 2,606
Non-qualified stock option and stock settled stock appreciation right        
(SSAR) expense   246   606
Total stock-based compensation expense $ 2,400 $ 3,212
 
Income tax benefit recognized for stock-based compensation expense $ 914 $ 1,281

 

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. Other than performance-based RSUs which contain a market-based element, the fair value of RSU grants were determined based on the closing price of a share of the Company's common stock on the date of grant. The fair value of RSUs with market-based vesting features was also measured on the grant date, but was done so using a binomial lattice model.

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 2012, the Company made its annual grant to its key employees consisting of 238,810 Performance Restricted Stock Units (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 Net After Tax Profit (NATP) for the year ending June 30, 2013 and on the average share price of Company stock for the 90 day period ending September 14, 2013 as compared to the average share price for the 90 day period ended September 14, 2012. No PRSUs will be earned if the specified NATP for the fiscal year ending June 30, 2013 is not met. If NATP for the year ending June 30, 2013 exceeds the specified NATP and the average share price of the Company's stock for the 90 day period ending September 14, 2013 exceeds the average share price of the Company's stock for the 90 day period ending September 14, 2012 by 50 or more percent then an additional 238,810 RSUs could be earned by participants. This is the maximum number of additional RSUs that can be earned related to the September 2012 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 1, 2015 and 50 percent of the earned award will vest on September 1, 2016, 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.

The total number of shares authorized by shareholders for grants under the 2006 Plan and its predecessor plan is 12,450,000 as of September 30, 2012. 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 September 30, 2012, cumulative grants of 12,565,130 equity instruments underlying the shares authorized have been awarded, and 3,571,213 of these instruments have been forfeited.

Activity related to SSARs/non-qualified stock options and RSUs/restricted shares during the three months ended September 30, 2012 is as follows:

  SSARs/        
  Non-qualified     RSUs/  
  Stock Options     Restricted Shares  
Outstanding, June 30, 2012 1,683,698     1,651,321  
Granted —     258,721  
Exercised/Issued (98,850 )   (204,293 )
Forfeited/Lapsed (547,559 )   (444,938 )
Outstanding, September 30, 2012 1,037,289     1,260,811  
 
Weighted average grant date fair value for RSUs/restricted shares     $ 67.25  

 

As of September 30, 2012, there was $0.6 million of total unrecognized compensation cost related to SSARs and stock options scheduled to be recognized over a weighted average period of 0.9 years, and $32.5 million of total unrecognized compensation cost related to restricted shares and RSUs scheduled to be recognized over a weighted-average period of 2.8 years.