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Share-based Compensation | 12 Months Ended
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Jun. 30, 2024
Share-Based Payment Arrangement, Disclosure [Abstract] |
Share-based Compensation | Share-based Compensation Share-based Compensation Expense The Company has three share-based compensation plans: the 2020 Employee Stock Plan (as amended, the “Employee Stock Plan”), the 2020 Stock Plan for Non-Employee Directors (as amended, the “Non-Employee Director Plan”) and the MSG Networks Inc. 2010 Employee Stock Plan (as amended, the “MSG Networks Employee Stock Plan”). Share-based compensation expense is generally recognized straight-line over the vesting term of the award, which typically provides for three-year cliff or graded vesting subject to continued employment. For awards that provide for graded vesting and are subject to performance conditions, in addition to continued employment, the Company uses the graded-vesting method to recognize share-based compensation expense. Share-based compensation expense for the Company’s restricted stock units (“RSUs”), performance stock units (“PSUs”), stock options and/or cash-settled stock appreciation rights (“SARs”) are recognized in the consolidated statements of operations as a component of direct operating expenses or selling, general and administrative expenses. In connection with the MSGE Distribution, pursuant to the terms of the incentive plans and applicable award agreements, (i) each holder of an employee RSU and PSU received one MSG Entertainment RSU or PSU in respect of every one Company RSU or PSU owned on the Record Date and continues to be entitled to one share of the Company’s Class A Common Stock for each Company RSU or PSU in accordance with the existing award agreement, (ii) one share of MSG Entertainment Class A Common Stock was issued under the MSG Entertainment Non-Employee Director Plan in respect of every one RSU outstanding under the Company’s 2020 Stock Plan for Non-Employee Directors, which remain outstanding and continue to be entitled to a share of the Company’s Class A Common Stock in accordance with the existing award agreement, and (iii) each option to purchase the Company’s Class A Common Stock became two options: one option to acquire MSG Entertainment Class A Common Stock and one option to acquire the Company’s Class A Common Stock. The existing exercise price was allocated between the Company’s options and the new MSG Entertainment options based upon the weighted average price of each of our Class A Common Stock and MSG Entertainment Class A Common Stock over the ten trading days immediately following the MSGE Distribution as reported by Bloomberg, and the underlying share amount was consistent with the one-to-one distribution ratio in the MSGE Distribution. Other than the split of the options and the allocation of the existing exercise price, there were no additional adjustments to existing options in connection with the MSGE Distribution. The Company’s RSUs/PSUs and/or stock options held by individuals who are solely employees of MSG Sports or MSG Entertainment are not expensed by the Company; however, such RSUs/PSUs and/or stock options do have a dilutive effect on earnings (loss) per share available to the Company’s common stockholders. The following table summarizes the Company’s share-based compensation expense for Fiscal Years 2024, 2023 and 2022:
|  | Fiscal Year Ended
|  | June 30,
|  | 2024 |  | 2023 |  | 2022
Share-based compensation (a) |  | $ | 47,382 |  |  | $ | 42,607 |  |  | $ | 56,760 |
_________________ (a) Share-based compensation excludes costs that have been capitalized of $2,193, $3,642, and $2,979 for Fiscal Years 2024, 2023 and 2022, respectively. For Fiscal Years 2024, 2023 and 2022, share-based compensation also excludes costs of $1,166, $8,118, and $4,254, respectively, that have been reclassified to Restructuring charges in the consolidated statements of operations, as detailed in Note 5., Restructuring Charges. RSU and PSU Award Activity The following table summarizes activity related to the Company’s RSUs and PSUs, held by the Company, MSG Sports and MSG Entertainment employees for Fiscal Year 2024:
| Number of |  | Weighted-Average Grant-date Fair Value
| RSUs |  | PSUs |
Unvested award balance as of June 30, 2023 | 1,140 |  |  | 1,179 |  |  | $ | 63.74 |
Granted | 626 |  |  | 439 |  |  | $ | 36.94 |
Vested (a) | (660) |  |  | (338) |  |  | $ | 37.48 |
Forfeited | (68) |  |  | (85) |  |  | $ | 31.99 |
Unvested award balance as of June 30, 2024 | 1,038 |  |  | 1,195 |  |  | $ | 64.90 |
_________________ (a) The fair value of RSUs and PSUs that vested and were distributed during Fiscal Year 2024 was $45,263. Upon delivery, RSUs and PSUs granted under the Employee Stock Plan and the MSG Networks Employee Stock Plan were net share-settled to cover the required statutory tax withholding obligations. To fulfill the employees’ statutory minimum tax withholding obligations for the applicable income and other employment taxes, 431 awards, with an aggregate value of $15,996 were retained by the Company during Fiscal Year 2024. As of June 30, 2024, there was $88,753 of unrecognized compensation cost related to unvested RSUs and PSUs held by the Company’s employees. The cost is expected to be recognized over a weighted-average period of approximately 2.1 years. Additionally, there was no unrecognized compensation cost related to unvested stock options held by the Company’s employees. The following table summarizes additional information about RSUs and PSUs:
| Years Ended June 30,
| 2024 |  | 2023 |  | 2022
Weighted average grant date fair value per share of awards granted | $ | 36.94 |  |  | $ | 50.81 |  |  | $ | 79.34 |
Fair value of awards vested | $ | 45,263 |  |  | $ | 42,467 |  |  | $ | 39,530 |
Stock Options Award Activity Compensation expense for the Company’s existing stock options is determined based on the grant date fair value of the award calculated using the Black-Scholes options-pricing model. Stock options generally cliff-vest after a three year service period and expire 7.5 to 10 years from the date of grant. The following table summarizes activity related to the Company’s stock options for Fiscal Year 2024:
| Number of Stock Options |  |  | Weighted-Average Exercise Price Per Share |  | Weighted-Average Remaining Contractual Term (In Years) |  | Aggregate Intrinsic Value
Balance as of June 30, 2023 | 724 |  |  |  | $ | 48.03 |  |  |  |  |
Options granted during Fiscal Year 2024 | 3,819 |  |  |  | $ | 46.17 |  |  |  |  |
Options exercised during Fiscal Year 2024 | (184) |  |  |  | $ | 48.06 |  |  |  |  |
Options forfeited during Fiscal Year 2024 | (432) |  |  |  | $ | 46.17 |  |  |  |  |
Balance as of June 30, 2024 | 3,927 |  |  |  | $ | 51.51 |  |  | 8.32 |  | $ | 497 |
Exercisable as of June 30, 2024 | 540 |  |  |  | $ | 48.08 |  |  | 2.06 |  | $ | 497 |
Effective as of the 2020 Entertainment Distribution, the Company adopted two share-based compensation plans: the 2020 Employee Stock Plan (the “Employee Stock Plan”) and the 2020 Stock Plan for Non-Employee Directors (the “Non-Employee Director Plan”). Under the Employee Stock Plan, the Company is authorized to grant incentive stock options, non-qualified stock options, restricted shares, RSUs, stock appreciation rights and other equity-based awards. The Company may grant awards for up to 4,500 shares of Class A Common Stock (subject to certain adjustments). Options and stock appreciation rights under the Employee Stock Plan must be granted with an exercise price of not less than the fair market value of a share of Class A Common Stock on the date of grant and must expire no later than 10 years from the date of grant (or up to one additional year in the case of the death of a holder). The terms and conditions of awards granted under the Employee Stock Plan, including vesting and exercisability, were determined by the Compensation Committee of the Board of Directors (“Compensation Committee”) and included terms or conditions based upon performance criteria. RSUs that were awarded by the Company to its employees will settle in shares of Class A Common Stock (either from treasury or with newly issued shares), or, at the option of the Compensation Committee, in cash. Under the Non-Employee Director Plan, the Company is authorized to grant non-qualified stock options, RSUs, restricted shares, stock appreciation rights and other equity-based awards. The Company may grant awards for up to 250 shares of Class A Common Stock (subject to certain adjustments). Options under the Non-Employee Director Plan must be granted with an exercise price of not less than the fair market value of a share of Class A Common Stock on the date of grant and must expire no later than 10 years from the date of grant (or up to one additional year in the case of the death of a holder). The terms and conditions of awards granted under the Non-Employee Director Plan, including vesting and exercisability, were determined by the Compensation Committee. Unless otherwise provided in an applicable award agreement, options granted under this plan will be fully vested and exercisable upon the date of grant. Unless otherwise provided in an applicable award agreement, RSUs granted under this plan will be fully vested upon the date of grant and will settle in shares of Class A Common Stock (either from treasury or with newly issued shares), or, at the option of the Compensation Committee, in cash, on the first business day after ninety days from the date the director incurs a separation from service or, if earlier, upon the director’s death. SARs Award Activity Compensation expense for the Company’s SARs is determined based on mark-to-market valuation of the awards calculated using the Black-Scholes options-pricing model. SARs generally cliff-vest after a three year service period. The following table summarizes activity related to the Company’s SARs for Fiscal Year 2024:
| Number of SARs |  |  | Weighted-Average Price |  | Weighted-Average Remaining Contractual Term (In Years) |  | Aggregate Intrinsic Value
Balance as of June 30, 2023 | — |  |  |  | $ | — |  |  |  |  |
SARs granted during Fiscal Year 2024 | 188 |  |  |  | $ | 46.17 |  |  |  |  |
Balance as of June 30, 2024 | 188 |  |  |  | $ | 46.17 |  |  | 2.31 |  | $ | — |
Exercisable as of June 30, 2024 | — |  |  |  | $ | — |  |  |  |  |

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