What changed in this filing

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Item 9A. Controls and Procedures

2023-08-17 compared with 2022-08-18 · 371 added, 571 removed, 1265 unchanged (43% of the section changed)

1 unchanged sentence

Evaluation of Disclosure Controls and Procedures

An evaluation was carried out under the supervision and with the participation of the Company’s management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report.

Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer concluded that as of June 30, 2022 the Company’s disclosure controls and procedures were effective.

An evaluation was carried out under the supervision and with the participation of the Company’s management, including our Executive Chairman (our principal executive officer) and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report.

Based upon that evaluation, the Company’s Executive Chairman and Chief Financial Officer concluded that as of June 30, 2023 the Company’s disclosure controls and procedures were effective.

Management’s Report on Internal Control over Financial Reporting

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Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of management, including the Company’s Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Under the supervision and with the participation of management, including the Company’s Executive Chairman and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on the results of this evaluation, our management concluded that our internal control over financial reporting was effective as of June 30, 2023.

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Other Information

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

Directors, Executive Officers and Corporate Governance

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Schedules other than that listed above have been omitted, since they are either not applicable, not required or the information is included elsewhere herein.

Distribution Agreement, dated September 11, 2015, between MSG Networks Inc.

and Madison Square Garden Sports Corp.

(formerly, The Madison Square Garden Company) (incorporated by reference to Exhibit 2.1 to Amendment No.

6 to the Company’s Registration Statement on Form 10 filed on September 11, 2015).

Contribution Agreement, dated September 11, 2015, among MSG Networks Inc., MSGN Holdings, L.P.

and Madison Square Garden Sports Corp.

(formerly, The Madison Square Garden Company) (incorporated by reference to Exhibit 2.2 to Amendment No.

6 to the Company’s Registration Statement on Form 10 filed on September 11, 2015).

Distribution Agreement, dated as of March 31, 2020, between Madison Square Garden Sports Corp.

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Description of Capital Stock (incorporated by reference to Exhibit 4.5 to the Company’s Form 10-K for the fiscal year ended June 30, 2021 filed on August 19, 2021).

Tax Disaffiliation Agreement, dated September 11, 2015, between MSG Networks Inc.

and Madison Square Garden Sports Corp.

(formerly, The Madison Square Garden Company) (incorporated by reference to Exhibit 10.2 to Amendment No.

6 to the Company’s Registration Statement on Form 10 filed on September 11, 2015).

Employee Matters Agreement, dated September 11, 2015, by and between MSG Networks Inc.

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(formerly, The Madison Square Garden Company) Option Agreement (incorporated by reference to Exhibit 10.4 to the Company’s Form 10-Q for the quarter ended December 31, 2017 filed on February 8, 2018).

Form of Performance Restricted Stock Units Agreement Under the 2015 Employee Stock Plan (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on April 25, 2023).

Form of Restricted Stock Units Agreement Under the 2015 Employee Stock Plan (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on April 25, 2023).

Form of Stock Option Agreement Under the 2015 Employee Stock Plan (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K filed on April 25, 2023).

Employment Agreement dated as of November 17, 2021, between Madison Square Garden Sports Corp.

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and Andrew Lustgarten (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 21, 2021).

Employment Agreement dated as of April 17, 2020 between Madison Square Garden Sports Corp.

(formerly, The Madison Square Garden Company) and Alexander Shvartsman (incorporated by reference to Exhibit 10.22 to the Company's Annual Report on Form 10-K for the year ended June 30, 2020 filed on August 31, 2020).

Employment Agreement dated as of December 27, 2021, between Madison Square Garden Sports Corp.

Dolan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 30, 2021).

Employment Agreement, dated December 18, 2020, between Madison Square Garden Sports Corp.

and Lawrence J.

Burian (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 18, 2020).

E mployment Agreement dated as of December 27, 2021 between Madison Square Garden Sports Corp.

Dolan, as amended and restated as of April 20, 2023 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 25, 2023).

Employment Agreement dated as of March 17, 2022, between Madison Square Garden Sports Corp.

and Jamaal Lesane (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 filed on May 5, 2022).

Employment Agreement dated as of September 9, 2022, between Madison Square Garden Sports Corp.

and David Hopkinson (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on September 9, 2022).

Employment Agreement dated as of June 15, 2023, between Madison Square Garden Sports Corp.

and David Granville-Smith.

Employment Agreement dated as of April 25, 2023 between Madison Square Garden Sports Corp.

and Alex Shvartsman (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on April 25, 2023).

Option Agreement, dated December 15, 2017, between Madison Square Garden Sports Corp.

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(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on March 31, 2020).

Transition Services Agreement, dated as of March 31, 2020, between MSG Sports, LLC and MSG Entertainment Group, LLC (formerly, MSG Sports & Entertainment, LLC) (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on March 31, 2020).

Tax Disaffiliation Agreement, dated as of March 31, 2020, between Madison Square Garden Sports Corp.

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Madison Square Garden Sports Corp.

Policy Concerning Certain Matters Relating to Madison Square Garden Entertainment Corp.

and AMC Networks Inc., including Responsibilities of Overlapping Directors and Officers (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2021 filed on November 9, 2021).

Policy Concerning Certain Matters Relating to Madison Square Garden Entertainment Corp., Sphere Entertainment Co.

and AMC Networks Inc., including Responsibilities of Overlapping Directors and Officers.

Sponsorship Sales and Service Representation Agreement, dated April 15, 2020, between Knicks Holdings, LLC and MSG Entertainment Group, LLC (incorporated by reference to Exhibit 10.76 to the Company’s Annual Report on Form 10-K for the year ended June 30, 2020 filed on August 31, 2020).

Sponsorship Sales and Service Representation Agreement, dated April 15, 2020, between New York Rangers, LLC and MSG Entertainment Group, LLC (incorporated by reference to Exhibit 10.77 to the Company’s Annual Report on Form 10-K for the year ended June 30, 2020 filed on August 31, 2020).

Letter from KPMG LLP (incorporated by reference to Exhibit 16.1 to the Company’s Current Report on Form 8-K filed on November 24, 2020).

Subsidiaries of the Registrant.

Consent of KPMG LLP.

Consent of Deloitte & Touche LLP.

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Annual Report on Form 10-K for the year ended June 30, 2023, formatted in Inline Extensible Business Reporting Language (iXBRL):

(i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Equity and Redeemable Noncontrolling Interests, and (vi) Notes to Consolidated Financial Statements.

(i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Equity, and (vi) Notes to Consolidated Financial Statements.

104 Cover Page Interactive Data File (formatted in iXBRL and included in Exhibit 101).

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* Certain confidential information, identified by bracketed asterisks “[*****]” has been omitted from this exhibit pursuant to Item 601(b)(10) of Regulation S-K because it is both (i) not material and (ii) would be competitively harmful to the Company if publicly disclosed.

** Furnished herewith.

These exhibits shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section.

Such exhibits shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

† This exhibit is a management contract or a compensatory plan or arrangement.

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Allowance for doubtful accounts $ — $ — $ — $ — $ —

Deferred tax valuation allowance ( 48,133 ) 51,496 ( 3,363 ) (a)

Deferred tax valuation allowance — — — — —

$ — $ — $ — $ — $ —

Year ended June 30, 2021

Allowance for doubtful accounts (b)

$ ( 1,814 ) $ ( 7,170 ) $ — $ 8,804 (c)

Deferred tax valuation allowance (b)

( 75,701 ) ( 46,514 ) — 74,082 (d)

Allowance for doubtful accounts $ ( 180 ) $ 175 $ — $ 5 $ —

Deferred tax valuation allowance ( 48,133 ) 51,496 ( 3,363 ) (a)

$ ( 48,313 ) $ 51,671 $ ( 3,363 ) $ 5 $ —

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(a) Includes amounts related to return to provision adjustments.

(b) Includes amounts classified as discontinued operations on the consolidated balance sheet.

(d) The Company completely offset the taxable income of discontinued operations, including taxable income resulting from the acceleration of deferred revenue with NOLs.

The deferred tax assets for such NOLs had a full valuation allowance.

Therefore, both the deferred tax asset and valuation allowance were reduced with no residual tax expense.

The valuation allowance reduction relating to the NOL utilization was $ 68,000 .

Pursuant to the requirements of the Section 13 or 15(d) the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on the 17 th day of August 2023.

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POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Andrew Lustgarten, Victoria M.

Mink and Jamaal Lesane, and each of them, as such person’s true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for such person in such person’s name, place and stead, in any and all capacities, to sign this report, and file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them may lawfully do or cause to be done by virtue hereof.

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Victoria M.

Mink, Jamaal Lesane and Mark C.

Cresitello, and each of them, as such person’s true and lawful attorneys-in-fact and agents, with full power of substitution and resubstitution, for such person in such person’s name, place and stead, in any and all capacities, to sign this report, and file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed below by the following persons in the capacities and on the dates indicated.

Name Title Date

/s/ ANDREW LUSTGARTEN President and Chief Executive Officer

(Principal Executive Officer) August 18, 2022

Andrew Lustgarten

DOLAN Executive Chairman (Principal Executive Officer) and Director August 17, 2023

/ s / VICTORIA M.

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Alexander Shvartsman

/ s / JAMES L.

Executive Chairman (Director) August 18, 2022

/ s / CHARLES F.

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Director August 17, 2023

/s/ ANDREW LUSTGARTEN Director August 17, 2023

Andrew Lustgarten

/s/ STEPHEN C.

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Report of Independent Registered Public Accounting Firm (Deloitte & Touche LLP, New York, NY, Auditor Firm ID:

KPMG LLP, New York, NY, Auditor Firm ID:

Consolidated Balance Sheets as of June 30, 2023 and 2022

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Consolidated Statements of Cash Flows for the years ended June 30, 2023, 2022 and 2021

Consolidated Statements of Equity and Redeemable Noncontrolling Interests for the years ended June 30, 2022, 2021 and 2020

Consolidated Statements of Equity for the years ended June 30, 2023, 2022 and 2021

Notes to Consolidated Financial Statements

Report of Independent Registered Public Accounting Firm

To the shareholders and the Board of Directors of Madison Square Garden Sports Corp.

To the Stockholders and the Board of Directors of Madison Square Garden Sports Corp.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Madison Square Garden Sports Corp.

and subsidiaries (the "Company") as of June 30, 2022 and 2021, the related consolidated statements of operations, comprehensive income (loss), cash flows, and equity and redeemable noncontrolling interests, for each of the two years in the period ended June 30, 2022, and the related notes and the consolidated financial statement Schedule II listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2022 and 2021, and the results of its operations and its cash flows for each of the two years in the period ended June 30, 2022, in conformity with accounting principles generally accepted in the United States of America.

and subsidiaries (the "Company") as of June 30, 2023 and 2022, the related consolidated statements of operations, comprehensive income (loss), cash flows, and equity, for each of the three years in the period ended June 30, 2023, and the related notes and the consolidated financial statement Schedule II listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended June 30, 2023, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of June 30, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated August 17, 2023 expressed an unqualified opinion on the Company's internal control over financial reporting.

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Critical Audit Matter Description

The Dolan family, including trusts for the benefit of members of the Dolan family (collectively, the Dolan Family Group) is the majority beneficial owner of the Company, Madison Square Garden Entertainment Corp., and AMC Networks, Inc.

The Dolan family, including trusts for the benefit of members of the Dolan family (collectively, the Dolan Family Group) is the majority beneficial owner of the Company, Sphere Entertainment Co., Madison Square Garden Entertainment Corp., and AMC Networks, Inc.

In addition, there are or have been certain overlapping directors and executive officers between the companies.

Each of these entities has been identified as a related party at June 30, 2022.

The Company has entered into a number of transactions with related parties, including, but not limited to agreements for use of the Madison Square Garden Arena, media rights, sales and service representation, team sponsorship allocation, and other services, as well as certain shared executive support costs for the Company’s Executive Chairman, the Company’s Vice Chairman and the Company’s President and Chief Executive Officer.

Each of these companies has been identified as a related party at June 30, 2023.

The Company has entered into a number of transactions with related parties, including, but not limited to agreements for use of the Madison Square Garden Arena, media rights, sales and service representation, team sponsorship allocation, sublease of office space, and other services, as well as certain shared executive support costs for the Company’s Executive Chairman, the Company’s Vice Chairman, the Company’s Executive Vice President and previously, the Company’s former Chief Executive Officer.

We identified the evaluation of the Company’s identification of related parties and related party transactions as a critical audit matter.

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How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the Company’s identification of related parties and related party transactions included the following, among others:

• We tested the operating effectiveness of certain internal controls over the Company’s related party process, including controls over the identification of the Company’s related party relationships and transactions;

the authorization and approval of transactions with related parties, the allocation of revenues and operating expenses among related parties, and the accounting for and disclosure of relationships and transactions with related parties in the financial statements;

• Inquired with executive officers including the Company’s internal legal counsel, key members of management, the Audit Committee of the Board of Directors and others within the Company regarding related party relationships and transactions;

Our audit procedures related to the Company’s identification of related parties and related party transactions included the following:

• We tested the effectiveness of internal controls over the Company’s related party process, including controls over the identification of the Company’s related party relationships and transactions, the authorization and approval of transactions with related parties, the allocation of revenues and operating expenses among related parties, and the accounting, classification and disclosure of relationships and transactions with related parties in the financial statements;

• Inquired with executive officers including the Company’s internal legal counsel, key members of management, including non-finance and non-accounting personnel, and the Audit Committee of the Board of Directors regarding related party relationships and transactions;

• Read agreements and contracts with and between related parties and, in certain cases third parties, and evaluated whether authorization and approvals were obtained and the terms and other information about transactions are consistent with explanations from inquiries and other audit evidence obtained about the business purpose of the transactions;

• With the assistance of our data specialists, we analyzed the general ledger detail to identify potential additional transactions with related parties;

• With the assistance of our data specialists, we analyzed the general ledger detail to identify potential undisclosed transactions with related parties;

• Compared the Company’s reconciliation of applicable accounts to related parties’ records of transactions and balances;

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• Received confirmations from related parties, and, in certain cases third parties, and compared responses to the Company’s records;

• Performed the following procedures to identify information related to potential additional transactions between the Company and related parties that may also include third parties:

• Performed the following procedures to identify information related to potential undisclosed transactions between the Company and related parties that may also involve third parties:

◦ Read the Company’s minutes from meetings of the Board of Directors and related committees of the Board of Directors;

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◦ Read publicly available sources including the Company’s public filings and press releases as well as certain analyst and industry reports;

◦ Listened to or read transcripts of the Company’s quarterly earnings calls.

◦ Listened to or read transcripts of the Company’s earnings calls.

/s/ Deloitte & Touche LLP

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Report of Independent Registered Public Accounting Firm

To the shareholders and the Board of Directors of Madison Square Garden Sports Corp.

To the Stockholders and the Board of Directors of Madison Square Garden Sports Corp.

Opinion on Internal Control over Financial Reporting

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In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of June 30, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended June 30, 2022 of the Company (the “financial statements”), and our report dated August 18, 2022, expressed an unqualified opinion on those financial statements.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended June 30, 2023 of the Company and our report dated August 17, 2023, expressed an unqualified opinion on those financial statements.

Basis for Opinion

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August 17, 2023

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors

MADISON SQUARE GARDEN SPORTS CORP.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated statements of operations, comprehensive loss, cash flows, and equity and redeemable noncontrolling interests of Madison Square Garden Sports Corp.

and subsidiaries (the “Company”) for the year ended June 30, 2020, and the related notes and financial statement schedule II (collectively, the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the results of operations of the Company and its cash flows for the year ended June 30, 2020, in conformity with U.S.

generally accepted accounting principles.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that our audit provides a reasonable basis for our opinion.

We served as the Company’s auditor from 2015 to 2020.

New York, New York

August 28, 2020

MADISON SQUARE GARDEN SPORTS CORP.

CONSOLIDATED BALANCE SHEETS

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Goodwill 226,523 226,955

Deferred income tax assets, net — 15,943

Investments 67,374 4,736

Other assets 22,459 32,552

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Interest expense ( 22,884 ) ( 11,735 ) ( 10,561 )

Miscellaneous expense, net ( 726 ) ( 346 ) ( 421 )

Miscellaneous income (expense), net 25,239 ( 726 ) ( 346 )

4,747 ( 12,148 ) ( 10,875 )

Income (loss) from continuing operations before income taxes 73,932 ( 89,318 ) ( 98,048 )

Income (loss) before income taxes 89,921 73,932 ( 89,318 )

Income tax (expense) benefit ( 44,293 ) ( 25,052 ) 73,421

Income (loss) from continuing operations 48,880 ( 15,897 ) ( 118,641 )

Loss from discontinued operations, net of taxes — — ( 90,222 )

Net income (loss) 45,628 48,880 ( 15,897 )

Net loss attributable to nonredeemable noncontrolling interests from continuing operations

( 2,251 ) ( 1,943 ) ( 2,342 )

Net loss attributable to redeemable noncontrolling interests from discontinued operations

— — ( 24,013 )

Net loss attributable to nonredeemable noncontrolling interests from discontinued operations

Net loss attributable to nonredeemable noncontrolling interests ( 2,165 ) ( 2,251 ) ( 1,943 )

Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders $ 47,793 $ 51,131 $ ( 13,954 )

Continuing operations

$ 2.11 $ ( 0.58 ) $ ( 4.86 )

Discontinued operations

Basic earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders

$ 1.90 $ 2.11 $ ( 0.58 )

Continuing operations

$ 2.10 $ ( 0.58 ) $ ( 4.86 )

Discontinued operations

Diluted earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders

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30 263 9 1,220 47 112

Cumulative translation adjustments

— — ( 4,809 )

Other comprehensive income (loss), before income taxes 1,220 112 ( 4,128 )

Income tax expense related to items of other comprehensive income (loss) ( 379 ) — —

Other comprehensive income (loss), net of income taxes 841 112 ( 4,128 )

Other comprehensive income, before income taxes 263 1,220 112

Income tax expense related to items of other comprehensive income ( 86 ) ( 379 ) —

Other comprehensive income, net of income taxes 177 841 112

Comprehensive income (loss) 45,805 49,721 ( 15,785 )

Comprehensive loss attributable to nonredeemable noncontrolling interests from continuing operations ( 2,251 ) ( 1,943 ) ( 2,342 )

Comprehensive loss attributable to redeemable noncontrolling interests from discontinued operations — — ( 24,013 )

Comprehensive loss attributable to nonredeemable noncontrolling interests from discontinued operations — — ( 120 )

Comprehensive loss attributable to nonredeemable noncontrolling interests ( 2,165 ) ( 2,251 ) ( 1,943 )

Comprehensive income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders $ 47,970 $ 51,972 $ ( 13,842 )

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Depreciation and amortization 3,577 5,042 5,574

Impairment of intangibles, long-lived assets and goodwill — — 102,211

Share-based compensation expense 25,203 24,245 30,437

Loss in equity method investments, net of income distributions — — 3,901

Provision for (benefit from) deferred income taxes 15,022 24,480 ( 73,664 )

Purchase accounting adjustments associated with leases — — 4,621

Unrealized loss on equity investment with readily determinable fair value — — 3,562

Unrealized (gain)/loss on equity investments with readily determinable fair value and warrants ( 26,561 ) 461 —

Provision for (recovery of) doubtful accounts — — ( 175 )

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Prepaid expenses and other assets ( 5,666 ) ( 8,922 ) ( 22,062 )

Investments ( 10,575 ) ( 3,197 ) —

Accounts payable ( 2,081 ) 8,947 ( 75 )

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Accrued and other liabilities 69,019 40,213 49,192

Collections due to promoters — — 15,924

Deferred revenue 7,590 772 34,578

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Capital expenditures ( 1,181 ) ( 932 ) ( 466 )

Proceeds from insurance recoveries — — 476

Payments for acquisition of assets — — ( 1,000 )

Purchase of short-term investments — — ( 405,935 )

Proceeds from maturity of short-term investments — — 176,661

Investments and loans to nonconsolidated affiliates — — ( 75 )

Proceeds from sales of nonconsolidated affiliates — — 18,000

Loan repayment received from subordinated debt — — 58,735

Cash received for notes receivable — — 750

Other investing activities ( 2,000 ) — —

Cash outflow associated with disposal of subsidiary ( 3,024 ) — —

Purchases of investments ( 13,554 ) ( 2,000 ) —

Net cash used in investing activities ( 17,759 ) ( 2,932 ) ( 466 )

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Cash flows from financing activities:

Cash distributed with MSG Entertainment — — ( 827,076 )

Accelerated share repurchase ( 75,060 ) — —

Taxes paid in lieu of shares issued for equity-based compensation ( 17,897 ) ( 18,306 ) ( 13,891 )

Proceeds from share issuance — 808 —

Noncontrolling interest capital contributions — — 4,000

Distributions to noncontrolling interest holders — — ( 535 )

Payment of contingent consideration — ( 200 ) ( 200 )

Dividends paid ( 170,923 ) — —

Proceeds from NHL advance — — 30,000

1 unchanged sentence

Repayment of revolving credit facility ( 140,000 ) ( 135,000 ) ( 25,000 )

Repayment on long-term debt — — ( 5,000 )

Payments for financing costs — ( 2,836 ) ( 4,562 )

Other financing activities 3,607 — 608

Net cash (used in) provided by financing activities ( 185,273 ) ( 156,142 ) 17,155

Effect of exchange rates on cash, cash equivalents and restricted cash — — 4,655

Net increase (decrease) in cash, cash equivalents and restricted cash 18,982 ( 18,637 ) ( 1,027,228 )

Cash, cash equivalents and restricted cash from continuing operations, beginning of period 72,036 90,673 25,836

Cash, cash equivalents and restricted cash from discontinued operations, beginning of period — — 1,092,065

Cash, cash equivalents and restricted cash at beginning of period 72,036 90,673 1,117,901

Cash, cash equivalents and restricted cash from continuing operations, end of period 91,018 72,036 90,673

Cash, cash equivalents and restricted cash from discontinued operations, end of period — — —

Net (decrease) increase in cash, cash equivalents and restricted cash ( 50,559 ) 18,982 ( 18,637 )

Cash, cash equivalents and restricted cash from beginning of period 91,018 72,036 90,673

Cash, cash equivalents and restricted cash at end of period 40,459 91,018 72,036

Non-cash investing and financing activities:

Non-cash acquisition of additional redeemable noncontrolling interests $ — $ — $ 37,715

Capital expenditures incurred but not yet paid 256 128 165

Tenant improvement paid by landlord — — 195

Share-based compensation capitalized in property and equipment — — 4,011

See accompanying notes to consolidated financial statements.

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CONSOLIDATED STATEMENTS OF EQUITY

AND REDEEMABLE NONCONTROLLING INTERESTS

(in thousands)

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Capital Treasury

Stock Retained Earnings (Accumulated Deficit) Accumulated

Stock Accumulated Deficit Accumulated

Comprehensive

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Noncontrolling

Interests Total Equity Redeemable Noncontrolling Interests

Interests Total Equity

Balance as of June 30, 2020 $ 249 $ 5,940 $ ( 167,431 ) $ ( 43,605 ) $ ( 2,139 ) $ ( 206,986 ) $ 3,551 $ ( 203,435 )

Net loss — — — ( 13,954 ) — ( 13,954 ) ( 1,943 ) ( 15,897 )

Other comprehensive loss

— — — — ( 4,128 ) ( 4,128 ) — ( 4,128 ) —

Other comprehensive income — — — — 112 112 — 112

Comprehensive loss — — — — ( 13,842 ) ( 1,943 ) ( 15,785 )

5 unchanged sentences

— ( 1,418 ) 20,697 ( 18,471 ) — 808 — 808

Noncontrolling interest non-cash acquisition

— 20,262 17,453 — — 37,715 — 37,715 ( 37,715 )

Distributions to noncontrolling interest holders — — — — — — ( 535 ) ( 535 ) —

Adjustments to noncontrolling interests — ( 834 ) — — — ( 834 ) 834 —

Contribution of joint venture interests — — — — — — 3,709 3,709 —

Redeemable noncontrolling interest adjustment to redemption fair value

— ( 16,939 ) — — — ( 16,939 ) — ( 16,939 ) 16,939

Distribution of Madison Square Garden Entertainment Corp.

— ( 2,853,244 ) — 109,780 48,912 ( 2,694,552 ) ( 16,845 ) ( 2,711,397 ) ( 22,838 )

Balance as of June 30, 2021 $ 249 $ 23,102 $ ( 146,734 ) $ ( 78,898 ) $ ( 2,027 ) $ ( 204,308 ) $ 2,442 $ ( 201,866 )

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CONSOLIDATED STATEMENTS OF EQUITY

AND REDEEMABLE NONCONTROLLING INTERESTS (Continued)

(in thousands)

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Balance as of June 30, 2021 $ 249 $ 23,102 $ ( 146,734 ) $ ( 78,898 ) $ ( 2,027 ) $ ( 204,308 ) $ 2,442 $ ( 201,866 )

Net loss — — — ( 13,954 ) — ( 13,954 ) ( 1,943 ) ( 15,897 )

Net income (loss) — — — 51,131 — 51,131 ( 2,251 ) 48,880

Other comprehensive income — — — — 841 841 — 841

Comprehensive loss — — — — — ( 13,842 ) ( 1,943 ) ( 15,785 )

Comprehensive income (loss) — — — — — 51,972 ( 2,251 ) 49,721

Share-based compensation

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CONSOLIDATED STATEMENTS OF EQUITY

AND REDEEMABLE NONCONTROLLING INTERESTS (Continued)

(in thousands)

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Common stock issued under stock incentive plans — ( 9,179 ) 20,983 ( 8,928 ) — 2,876 — 2,876

Dividends declared ($ 7.00 per share)

— — — ( 172,734 ) — ( 172,734 ) — ( 172,734 )

Accelerated share repurchase — 1,649 ( 72,367 ) ( 4,342 ) — ( 75,060 ) — ( 75,060 )

Adjustments to noncontrolling interests — ( 503 ) — — — ( 503 ) 453 ( 50 )

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Description of Business

Madison Square Garden Sports Corp., formerly The Madison Square Garden Company (together with its subsidiaries, the “Company” or “MSG Sports”) owns and operates a portfolio of assets featuring some of the most recognized teams in all of sports, including the New York Knickerbockers (“Knicks”) of the National Basketball Association (“NBA”) and the New York Rangers (“Rangers”) of the National Hockey League (“NHL”).

Madison Square Garden Sports Corp.

(together with its subsidiaries, the “Company” or “MSG Sports”) owns and operates a portfolio of assets featuring some of the most recognized teams in all of sports, including the New York Knickerbockers (“Knicks”) of the National Basketball Association (“NBA”) and the New York Rangers (“Rangers”) of the National Hockey League (“NHL”).

Both the Knicks and the Rangers play their home games in Madison Square Garden Arena (“The Garden”).

The Company’s other professional franchises include two development league teams — the Hartford Wolf Pack of the American Hockey League and the Westchester Knicks of the NBA G League.

These professional sports franchises are collectively referred to herein as the “sports teams.” In addition, the Company owns Knicks Gaming, an esports franchise that competes in the NBA 2K League, as well as a controlling interest in Counter Logic Gaming (“CLG”), a North American esports organization.

The Company also operates two professional sports team performance centers — the Madison Square Garden Training Center in Greenburgh, NY and the CLG Performance Center in Los Angeles, CA.

CLG and Knicks Gaming are collectively referred to herein as the “esports teams,” and together with the sports teams, the “teams.”

These professional sports franchises are collectively referred to herein as the “sports teams.” In addition, the Company previously owned a controlling interest in Counter Logic Gaming (“CLG”), a North American esports organization.

In April 2023, the Company sold its controlling interest in CLG to Hard Carry Gaming Inc.

(“NRG”), a professional gaming and entertainment company, in exchange for a noncontrolling equity interest in the combined NRG/CLG company.

CLG and the sports teams are collectively referred to herein as the “teams.” The Company also operates a professional sports team performance center — the Madison Square Garden Training Center in Greenburgh, NY.

The Company operates and reports financial information in one segment.

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(“MSG Networks”).

All the outstanding common stock of the Company was distributed to MSG Networks shareholders (the “MSGS Distribution”) on September 30, 2015 (the “MSGS Distribution Date”).

On April 17, 2020 (the “MSGE Distribution Date”), the Company distributed all of the outstanding common stock of Madison Square Garden Entertainment Corp.

(“MSG Entertainment”) to its stockholders (the “MSGE Distribution”).

MSG Entertainment owns, directly or indirectly, the entertainment business previously owned and operated by the Company through its MSG Entertainment business segment and the sports booking business previously owned and operated by the Company through its MSG Sports business segment.

In the MSGE Distribution, (a) each holder of the Company’s Class A common stock received one share of MSG Entertainment Class A common stock, par value $ 0.01 per share, for every share of the Company’s Class A common stock held of record as of the close of business, New York City time, on April 13, 2020 (the “Record Date”), and (b) each holder of the Company’s Class B common stock received one share of MSG Entertainment Class B common stock, par value $ 0.01 per share, for every share of the Company’s Class B common stock held of record as of the close of business, New York City time, on the Record Date.

All the outstanding common stock of the Company was distributed to MSG Networks shareholders (the “MSGS Distribution”) on September 30, 2015.

On April 17, 2020 (the “Sphere Distribution Date”), the Company distributed all of the outstanding common stock of Sphere Entertainment Co.

(formerly Madison Square Garden Entertainment Corp.

and referred to herein as “Sphere Entertainment”) to its stockholders (the “Sphere Distribution”).

Prior to the MSGE Distribution (as defined below), Sphere Entertainment owned, directly or indirectly, the entertainment business previously owned and operated by the Company through its MSG Entertainment business segment and the sports booking business previously owned and operated by the Company through its MSG Sports business segment.

On July 9, 2021 MSG Networks merged with a subsidiary of Sphere Entertainment and became a wholly-owned subsidiary of Sphere Entertainment.

Accordingly, agreements between the Company and MSG Networks are now effectively agreements with Sphere Entertainment on a consolidated basis.

On April 20, 2023 (the “MSGE Distribution Date”), Sphere Entertainment distributed approximately 67 % of the issued and outstanding shares of common stock of Madison Square Garden Entertainment Corp.

(formerly MSGE Spinco, Inc.

and referred to herein as “MSG Entertainment”) to its stockholders (the “MSGE Distribution”).

All agreements between the Company and MSG Entertainment described herein were between the Company and Sphere Entertainment prior to the MSGE Distribution (except agreements entered into after the MSGE Distribution).

Unless the context otherwise requires, all references to MSG Entertainment, Sphere Entertainment and MSG Networks refer to such entity, together with its direct and indirect subsidiaries.

Reclassifications

The historical results of MSG Entertainment have been reflected in the accompanying statements of operations for the year ended June 30, 2020 as discontinued operations.

See Note 3 for more information.

In addition, certain reclassifications have been made in order to conform to the current period’s presentation and relate to the separation of League-related accruals, which was previously reported in Other accrued liabilities in the consolidated balance sheet as of June 30, 2021.

Certain reclassifications have been made in order to conform to the current period’s presentation and relate to the separation of Investments, which was previously reported in Other assets in the consolidated balance sheet as of June 30, 2022 and related reclassifications on the consolidated statements of cash flows for the year ended June 30, 2022.

Impact of COVID-19

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In fiscal year 2022, the Company’s operations and operating results were also impacted by temporary declines in attendance due to ongoing reduced tourism levels as well as an increase in COVID-19 cases during certain months of the fiscal year.

Fiscal Years 2020 and 2021

In March 2020, the NBA and NHL suspended their 2019-20 seasons due to COVID-19.

As a result of the suspension of the 2019-20 NBA and NHL seasons and subsequent resumption of play in July and August 2020, respectively, during the first quarter of fiscal year 2021, the Company recognized certain revenues that otherwise would have been recognized during the third and fourth quarters of fiscal year 2020.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In addition, the start of the 2020-21 NBA and NHL regular seasons were delayed.

The Knicks and the Rangers did not start their seasons until December 16, 2020 and January 14, 2021, respectively, initially with no fans and then with fan attendance limited to 10% capacity starting on February 23 and February 26, respectively, due to government-mandated assembly restrictions.

Effective May 19, 2021, event venues such as The Garden were permitted to host guests at full capacity, subject to certain restrictions, including, for example, restrictions for unvaccinated guests.

As a result, the Knicks played three home playoff games with ticket sales of approximately 15,000-16,500 per game during the fiscal year ended June 30, 2021.

During the 2020-2021 season, the Knicks and the Rangers each played fewer games than their traditional 82-game regular season schedules, with the NBA playing a 72-game regular season schedule and the NHL playing a 56-game regular season schedule.

These disruptions materially impacted the Company’s revenues across a number of areas, including, ticket sales;

the Company’s share of suite licenses;

sponsorships;

signage and in-venue advertising at The Garden;

local media rights fees;

and food, beverage and merchandise sales.

In connection with the MSGE Distribution, we entered into the Arena License Agreements with MSG Entertainment.

At the time of the MSGE Distribution, the Garden was not available for use due to the government-mandated suspension of events in response to COVID-19, and was only available at reduced capacity beginning in December 2020 through May 2021.

As a result, the Company was not required to pay license fees to MSG Entertainment under the Arena License Agreements until games resumed at The Garden, and the Company paid substantially reduced fees while attendance was limited.

Effective July 1, 2021, the Company began paying license fees to MSG Entertainment under the Arena License Agreements in their full contractual amounts.

During fiscal year 2021, as a result of COVID-19, the Company implemented cost-reduction measures that included workforce reductions and limits on discretionary spending.

In addition, as a result of the disruptions caused by COVID-19, certain operating expenses were reduced, including (i) payments to MSG Entertainment under the Arena License Agreements described above, (ii) NBA league assessments and day-of-game expenses for Knicks and Rangers games, and (iii) league revenue sharing, net of escrow and team personnel expense.

These expense reductions did not fully offset revenue losses.

Fiscal Year 2022

Starting August 17, 2021, indoor entertainment venues such as The Garden were permitted to host guests at full capacity, subject to certain restrictions, including vaccination and/or mask requirements for guests.

In March 2022, New York City lifted all COVID-19 vaccination requirements pertaining to guests and professional athletes at indoor entertainment venues such as The Garden.

There are no capacity restrictions or vaccination requirements applicable to fan attendance at games at The Garden as of the date of this filing.

The Knicks and the Rangers each completed their full 82-game regular season schedules for the 2021-22 season in April 2022 and the Rangers competed in the playoffs in May and June 2022, playing ten home playoff games in total.

Fan attendance during fiscal year 2022 was impacted by the COVID-19 pandemic, including the emergence of certain variants and ongoing reduced tourism levels.

It is unclear to what extent COVID-19 concerns, including with respect to new variants, could result in renewed governmental and league restrictions on attendance or otherwise impact attendance of games at The Garden.

It is unclear to what extent COVID-19, including variants thereof, or another pandemic or public health emergency, could result in renewed governmental and/or league restrictions on attendance or otherwise impact attendance of games at The Garden, demand for our sponsorship, tickets and other premium inventory or otherwise impact the Company’s operations and operating results.

Summary of Significant Accounting Policies

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All significant intracompany transactions and accounts within the Company’s consolidated financial statements have been eliminated.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Use of Estimates

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These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses.

Such estimates include the valuation of accounts receivable, other current assets, goodwill, intangible assets, other long-lived assets, deferred tax valuation allowance, tax accruals and other liabilities.

Such estimates include the valuation of accounts receivable, other current assets, goodwill, intangible assets, other long-lived assets, fair value of investments, deferred tax valuation allowance, tax accruals and other liabilities.

In addition, estimates are used in revenue recognition, revenue sharing expense (net of escrow), luxury tax expense, income tax expense, performance and share-based compensation, depreciation and amortization, litigation matters and other matters, as well as in the valuation of contingent consideration and noncontrolling interests resulting from business combination transactions.

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Direct Operating Expenses

After the MSGE Distribution Date, Direct operating expenses include compensation expense for the Company’s professional sports teams’ players and certain other team personnel, as well as NBA luxury tax, if applicable, NBA and NHL revenue sharing (net of escrow) and league assessments for the Company, event costs related to the presentation and production of the Company’s sporting events and other operating expenses, including expenses related to the Arena License Agreements which require the Company to pay arena license fees to MSG Entertainment in exchange for the right to use The Garden for games of the Knicks and the Rangers for a 35 -year term.

Direct operating expenses include compensation expense for the Company’s sports teams’ players and certain other team personnel, as well as NBA luxury tax, if applicable, NBA and NHL revenue sharing (net of escrow) and league assessments for the Company, event costs related to the presentation and production of the Company’s sporting events and other operating expenses, including expenses related to the Arena License Agreements which require the Company to pay arena license fees to MSG Entertainment in exchange for the right to use The Garden for games of the Knicks and the Rangers for a 35-year term.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Player Costs and Other Team Personnel Transactions, NBA Luxury Tax, NBA and NHL Escrow System/Revenue Sharing, League Assessments, and Arena License Expenses

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The NBA and NHL each have collective bargaining agreements (each, a “CBA”) with the respective league’s players association, to which the Company is subject.

The NBA CBA expires after the 2023-24 season (although the NBA and the National Basketball Players Association (“NBPA”) each have the right (which must be exercised by December 15, 2022) to terminate the CBA following the 2022-23 season.

On April 26, 2023, the NBA and the National Basketball Players Association (“NBPA”) announced that a new seven-year CBA had been ratified by the NBA Board of Governors and the NBA players.

The new NBA CBA expires after the 2029-30 season, but each of the NBA and the NBPA has the right to terminate the CBA effective following the 2028-29 season.

The current NHL CBA is set to expire on September 15, 2026 (with the possibility of a one-year extension in certain circumstances).

The NBA CBA contains a salary floor (i.e., a floor on each team’s aggregate player salaries with a requirement that the team pay any deficiency to the players on its roster) and a “soft” salary cap (i.e., a cap on each team’s aggregate player salaries but with

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

certain exceptions that enable teams to pay more, sometimes substantially more, than the cap).

The NHL CBA provides for a salary floor (i.e., a floor on each team’s aggregate player salaries) and a “hard” salary cap (i.e., teams may not exceed a stated maximum, which has been adjusted each season thereafter based upon league-wide revenues).

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The Company recognizes the estimated amount associated with luxury tax expense or the amount it expects to receive as a non-tax paying team, if applicable, on a straight-line basis over the NBA regular season as a component of direct operating expenses.

The new CBA includes certain changes to certain league rules and regulations, including revised luxury tax rates which will become effective with the 2025-26 season.

NBA and NHL Escrow System/Revenue Sharing

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In the event that the league’s aggregate player compensation is below the designated percentage of league-wide revenues, the teams will remit the shortfall to the NBPA for distribution to the players.

For the 2020-21 season and the remainder of the CBA, the escrow system above was eliminated and a new “Ten-and-Spread” system was put in place.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

During the 2020-21 season, the escrow system above was eliminated and a new “Ten-and-Spread” system was put in place.

Under the Ten-and-Spread system, based upon league-wide revenues, aggregate player compensation will be reduced by up to 10% of each player’s salary.

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Each team is entitled to receive an equal one-thirtieth share of the compensation reductions up to 10% and the excess above 10% is allocated in proportion to each team’s player payroll.

This system was in place until the new CBA took effect on July 1, 2023.

The NBA also has a revenue sharing plan that generally requires the distribution of a pool of funds to teams with below-average net revenues (as defined in the plan), subject to reduction or elimination based on individual team market size and profitability.

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(b) then from payments by teams participating in the playoffs, with each team contributing 35% of its gate receipts for each home playoff game (although this provision was waived for the 2020-21 season);

and (c) the remainder from

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

centrally-generated NHL sources.

and (c) the remainder from centrally-generated NHL sources.

The Rangers are consistently among the top ten revenue teams and, accordingly, have consistently contributed to the top ten revenue teams component of the plan.

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As of June 30, 2023 and 2022, the Company had net revenue sharing liabilities, recorded within League-related accruals, of $ 94,822 and $ 64,717 , respectively.

In addition, as of June 30, 2022, the Company had receivable balances related to escrow and player compensation recoveries of $ 12,464 and $ 6,782 , recorded in Accounts receivable, net and Other assets, respectively.

As of June 30, 2021, the Company had receivable balances related to escrow and player compensation recoveries of $ 36,525 and $ 10,700 , recorded in Accounts receivable, net and Other assets, respectively.

League Assessments

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The governing bodies of each league determine the amount of each season’s league assessments that are required from each member team.

The NBA imposes on each team a 6% assessment on regular season ticket revenue.

The Company recognizes its teams’ estimated league assessments on a straight-line basis over the applicable NBA or NHL season.

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The Knicks and the Rangers play their home games at The Garden pursuant to the Arena License Agreements with MSG Entertainment, which owns and operates The Garden.

The Arena License Agreements are viewed as a continuation of an existing pre-spin relationship where the Knicks and the Rangers used The Garden through an inter-company cost-sharing arrangement.

Prior to the MSGE Distribution, the Company allocated certain costs and attributed direct costs to the MSG Sports business (See Note 3).

Generally, the financial statements reflect the monthly payments made for the Arena License Agreements throughout the contract year in equal installments, and straight-line rent expense recorded by each team equally over each team’s individual event days.

See Note 7 for more information on the accounting for leases.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Advertising Expenses

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For awards with graded vesting conditions, the values of the awards are determined by valuing all vesting tranches in the aggregate as one award using an average expected term.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company determines its assumptions for option-pricing models in accordance with ASC Topic 718 and SEC Staff Accounting Bulletin (“SAB”) No.

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Diluted EPS reflects the effect of the assumed vesting of restricted stock units and exercise of stock options (see Note 15) only in the periods in which such effect would have been dilutive.

For the periods when a net loss is reported, the computation of diluted EPS equals the basic EPS calculation since common stock equivalents were antidilutive due to losses from continuing operations.

For the periods when a net loss is reported, the computation of diluted EPS equals the basic EPS calculation since common stock equivalents were antidilutive due to losses from operations.

Holders of Class A Common Stock and Class B Common Stock are entitled to receive dividends equally on a per-share basis if and when such dividends are declared.

As the holders of Class A and Class B common stock are entitled to identical dividend and liquidation rights, the undistributed earnings are allocated on a proportionate basis to each class of common stock and the resulting basic and diluted net earnings (loss) per share attributable to common stockholders are, therefore, the same for both Class A and Class B common stock on both an individual and combined basis.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Cash and Cash Equivalents

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The carrying amount of restricted cash approximates fair value due to the short-term maturity of these instruments.

Changes in restricted cash are reflected on the accompanying consolidated statement of cash flows in accordance with ASU No.

Changes in restricted cash are reflected on the accompanying consolidated statement of cash flows in accordance with Accounting Standards Update (“ASU”) No.

2016-18, Statement of Cash Flows (Topic 230) , which is included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Company’s consolidated statements of cash flows.

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The Company’s long-lived and indefinite-lived assets consist of property and equipment, right-of-use (“ROU”) assets, goodwill, indefinite-lived intangible assets and amortizable intangible assets.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Property and equipment is stated at cost.

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The Company generally determines the fair value of a reporting unit using an income approach, such as the discounted cash flow method, in instances when it does not perform the qualitative assessment of goodwill.

Subsequent to the adoption of ASU No.

2017-04 in the third quarter of fiscal year 2020, the amount of an impairment loss is measured as the amount by which a reporting unit’s carrying value exceeds its fair value determined in step one, not to exceed the carrying amount of goodwill.

Prior to the adoption of ASU No.

2017-04, if the carrying amount of a reporting unit exceeded its fair value, the second step of the goodwill impairment test was performed to measure the amount of impairment loss, if any.

The amount of an impairment loss is measured as the amount by which a reporting unit’s carrying value exceeds its fair value determined in step one, not to exceed the carrying amount of goodwill.

The second step of the goodwill impairment test compared the implied fair value of the reporting unit’s goodwill with the carrying amount of that goodwill.

If the carrying amount of the reporting unit’s goodwill exceeded the implied fair value of that goodwill, an impairment loss was recognized in an amount equal to that excess.

If the carrying amount

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of the reporting unit’s goodwill exceeded the implied fair value of that goodwill, an impairment loss was recognized in an amount equal to that excess.

The implied fair value of goodwill was determined in the same manner as the amount of goodwill that would be recognized in a business combination.

The Company performs its goodwill impairment test at the reporting unit level, which is the same as or one level below the operating segment level.

Subsequent to the MSGE Distribution Date, the Company has one operating and reportable segment and one reporting unit for goodwill impairment testing purposes.

The Company has one operating and reportable segment and one reporting unit for goodwill impairment testing purposes.

Identifiable indefinite-lived intangible assets are tested annually for impairment as of August 31 st and at any time upon the occurrence of certain events or substantive changes in circumstances.

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The Company generally determines the fair value of a finite-lived intangible asset using an income approach, such as the discounted cash flow method.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Investments in Equity Securities

The Company has equity investments with and without readily determinable fair values.

The Company’s equity method investments are carried at cost, plus or minus the Company’s share of net earnings or losses of the investment, subject to certain other adjustments.

The cost of equity method investments includes transaction costs of the acquisition.

As required by GAAP, to the extent that there is a basis difference between the cost and the underlying equity in the net assets of an equity investment, the Company allocates such differences between tangible and intangible assets.

The Company’s share of net earnings or losses of the investment, inclusive of amortization expense for intangible assets associated with the investment, will be reflected in equity in earnings (loss) of nonconsolidated affiliates on the Company’s consolidated statements of operations.

Dividends received from the investee reduce the carrying amount of the investment.

Due to the timing of receiving financial information from its nonconsolidated affiliates, the Company records its share of net earnings or losses of such affiliates on a three-month lag basis.

In addition to equity method investments, the Company has equity investments with and without readily determinable fair values.

The Company measures equity investments without readily determinable fair values at cost, less any impairment, adjusted for observable price changes from orderly transactions for identical or similar investments of the same issuer.

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For equity investments with readily determinable fair values, changes in the fair value of those investments are measured at each reporting date and are recorded within Miscellaneous income (expense), net in the accompanying consolidated statements of operations.

The Company recognizes the value of the equity investments within Other assets in the accompanying consolidated balance sheets.

The Company has investments in certain derivative instruments, including warrants, which are measured at fair value using the Black-Scholes option pricing model.

Changes in the fair value of derivative instruments are measured at each reporting date and are recorded within Miscellaneous income (expense), net in the accompanying consolidated statements of operations.

The Company recognizes the value of the equity method investments, equity investments with and without readily determinable fair values, and derivative instruments within Investments in the accompanying consolidated balance sheets.

Purchases and sales of equity securities with and without readily determinable fair values, except for those equity investments held in trust under the Company’s Executive Deferred Compensation Plan as described in Note 14, are classified as investing activities in the Company’s consolidated statements of cash flows in accordance with ASC subtopic 230-10-45-12(b) and 45-13(b).

The equity securities held in trust are considered trading account securities by the Company and purchases and sales of those securities are classified as operating activities in the Company’s consolidated statements of cash flows in accordance with ASC Subtopic 230-10-45-18 and 45-19.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

Defined Benefit Pension Plans and Postretirement Benefit Plans

As more fully described in Note 14, prior to the MSGE Distribution the Company had both funded and unfunded defined benefit plans, as well as a contributory postretirement benefit plan, covering certain full-time employees and retirees.

Currently, the Company has unfunded defined benefit plans.

The expense recognized by the Company is determined using certain assumptions, including discount rates, among others, and prior to the MSGE Distribution, the expected long-term rate of return.

Defined Benefit Pension Plans

The Company has unfunded defined benefit plans.

The expense recognized by the Company is determined using certain assumptions, including discount rates, among others.

The Company recognizes the benefit obligation of its defined benefit pension plans (other than multiemployer plans) as a liability in the consolidated balance sheets and recognizes changes in the benefit obligation in the year in which the changes occur through other comprehensive income (loss).

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• Level III — Instruments whose significant value drivers are unobservable.

Recently Adopted Accounting Pronouncements

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes.

This ASU eliminates certain exceptions to the general approach in ASC Topic 740 and includes methods of simplification to the existing guidance.

The Company adopted this standard as of the beginning of fiscal year 2022, and the adoption did not have a material impact on its consolidated financial statements.

Discontinued Operations

In accordance with ASC 205-20, the Company analyzed the quantitative and qualitative factors relevant to the MSGE Distribution and determined that those held for sale conditions for discontinued operations presentation were met during the fourth quarter of fiscal year 2020.

As a result of the MSGE Distribution, the results of the entertainment business previously owned and operated by the Company through its MSG Entertainment business segment and the sports booking business previously owned and operated by the Company through its MSG Sports business segment through the MSGE Distribution Date, as well as transaction costs related to the MSGE Distribution, have been classified in the accompanying consolidated financial statements as discontinued operations for all periods presented.

No gain or loss was recognized in connection with the MSGE Distribution.

After the MSGE Distribution, the Company and MSG Entertainment have continuing involvement through their common ownership and related party arrangements, including sharing of certain revenues and expenses.

See Note 17 for additional information on the related party arrangements.

Prior to the MSGE Distribution, the Company’s results from discontinued

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

operations reflect a number of inter-company arrangements that dictate the allocable amounts of shared revenue and operating expenses.

The Company’s continuing revenues include event related revenues for ticket sales and a portion of shared suite license fees generated in connection with the games played at The Garden.

Pursuant to the Arena License Agreements, effective as of the MSGE Distribution Date, the Company’s aggregate share of the suite license fees is 67.5 %.

Thus, for the period prior to the MSGE Distribution, the allocated percentage of suite license fees of 32.5 % is reported within results of discontinued operations.

In addition, the Company’s multi-year sponsorship agreements may include performance obligations of the Company’s continuing and discontinued operations (see Note 4).

Sponsorship revenues reported within discontinued operations are based on the relative value of performance obligations wholly satisfied by the MSG Entertainment businesses.

Sponsorship agreements also include shared performance obligations that are from indoor venue signage and other shared sponsorship performance obligations.

For historically allocated shared signage and other shared sponsorship revenue, the Company calculated MSG Entertainment’s share to be presented within discontinued operations based on a combined revenue driver.

The Company’s continuing expenses include event costs related to the presentation and production of the Company’s sporting events and other operating expenses, including expenses related to the Arena License Agreements which require the Company to pay arena license fees to MSG Entertainment in exchange for the right to use The Garden for games of the Knicks and the Rangers.

Expenses related to the direct operations of MSG Entertainment, such as The Garden operating expenses related to the presentation and production of events and non-event related costs of operating the venue, are included in discontinued operations on the basis of an allocation of the direct usage of The Garden by the Company’s continuing and discontinued businesses.

Unallocated costs of operational support functions that were provided on a centralized basis and not historically recorded at the business unit level by the Company, are also included in discontinued operations, based on a measure of direct usage.

Direct usage was determined based on event specific variable expenses for MSG Entertainment events and otherwise on the basis of the proportion of combined revenues, headcount or other objective measures for expenses.

Indirect corporate and administrative costs, including amounts that were historically allocated to the MSG Entertainment business segment, do not qualify for discontinued operations presentation, and these costs are included in continuing operations for the period prior to the MSGE Distribution.

Various types of indirect corporate and administrative expenses that continue after the MSGE Distribution Date and are covered under the services agreement with MSG Entertainment, are included in continuing operations for the period after the MSGE Distribution.

In addition, results from continuing operations, prior to the MSGE Distribution Date, include certain corporate overhead expenses that the Company did not incur in the periods after the completion of the MSGE Distribution, and the Company does not expect to incur such expenses in future periods.

Discontinued operations include all depreciation expense for MSG Entertainment’s venues and other operating assets.

Depreciation expense on certain corporate property and equipment that was transferred to MSG Entertainment in connection with the MSGE Distribution, remained in continuing operations as it did not qualify for discontinued operations reporting.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The table below sets forth, for the fiscal year ended June 30, 2020, operating results of discontinued operations.

Amounts presented below differ from historically reported results for the MSG Entertainment business segment due to reclassifications and adjustments made for purposes of discontinued operations.

Year Ended June 30,

Revenues $ 669,096

Direct operating expenses 408,413

Selling, general and administrative expenses 206,524

Depreciation and amortization 75,822

Impairment of intangibles, long-lived assets and goodwill 102,211

Operating loss ( 123,874 )

Other income (expense):

Loss in equity method investments ( 3,901 )

Interest income 16,754

Interest expense ( 3,570 )

Miscellaneous expense, net ( 3,863 )

Loss from discontinued operations before income taxes ( 118,454 )

Income tax benefit 28,232

Net loss from discontinued operations ( 90,222 )

Net loss attributable to redeemable noncontrolling interests ( 24,013 )

Net loss attributable to nonredeemable noncontrolling interests ( 120 )

Net loss from discontinued operations attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 66,089 )

The amount of cash and restricted cash distributed as of the MSGE Distribution Date to MSG Entertainment was $ 816,896 and $ 10,180 , respectively.

As permitted under ASU 2014-08, the Company has elected not to adjust the consolidated statement of cash flows for the fiscal year ended June 30, 2020 to exclude cash flows attributable to discontinued operations.

The table below sets forth, for the fiscal year ended June 30, 2020, significant selected financial information related to MSG Entertainment included in the accompanied consolidated statements of cash flows:

Year Ended June 30,

Non-cash items included in net loss:

Depreciation and amortization $ 75,822

Impairment of intangibles, long-lived assets and goodwill 102,211

Share-based compensation expense 8,303

Cash flows from investing activities:

Capital expenditures $ 346,488

Non-cash investing activities:

Non-cash acquisition of additional redeemable noncontrolling interests $ 37,715

Capital expenditures incurred but not yet paid 104,137

Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements Not Yet Adopted

In March 2023, the Financial Accounting Standards Board issued ASU No.

2023-01, Leases (Topic 842):

Common Control Arrangements.

This ASU amends certain provisions of ASC 842, Leases that apply to arrangements between related parties under common control.

The new guidance is effective for the Company in the first quarter of fiscal year 2025.

The Company is currently evaluating the impact this standard will have on its consolidated financial statements.

MADISON SQUARE GARDEN SPORTS CORP.

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The Company’s performance obligation under such arrangements is to provide the licensee with access to the suite when events occur at The Garden.

Because suite and club licenses cover both the Knicks and the Rangers games and events that MSG Entertainment presents at The Garden, suite and club rental revenue is shared between us and MSG Entertainment under Arena License Agreements the Company entered into in connection with the MSGE Distribution.

Pursuant to the Arena Licenses Agreements, the Knicks and the Rangers are entitled to 35 % and 32.5 %, respectively, of the revenues received by MSG Entertainment in connection with suite and club licenses.

1 unchanged sentence

Progress toward satisfaction of the Company’s suite license performance obligations is measured as access to the suite is provided to the licensee throughout the contractual term of the license.

For the year ended June 30, 2020, due to the NBA and NHL suspending their season on March 11, and 12, 2020, respectively, suite license holders did not have access to their suites and therefore revenue recognition ceased at that time.

For the year ended June 30, 2021, access to suites for Knicks and Rangers games was primarily sold by way of individual tickets, thus minimal suite license revenue was recognized.

1 unchanged sentence

Payment is received at the point of sale and sales tax collected from customers is excluded from revenue.

Subsequent to the MSGE Distribution Date, pursuant to the Arena License Agreements, the Knicks and the Rangers receive 50 % of net profits from the sales of food and beverages during their games at The Garden.

Pursuant to the Arena License Agreements, the Knicks and the Rangers receive 50 % of net profits from the sales of food and beverages during their games at The Garden.

In addition to event-related revenue, MSG Sports maintains local media rights arrangements which provide for the licensing of team-related programming to MSG Networks.

MSG Sports, pursuant to the terms of the agreements, receives such rights fees in equal monthly installments throughout each license year.

The transaction price under these arrangements is variable in nature as certain credit provisions exist to the extent that the teams’ games are unavailable for broadcast during an individual league season.

The transaction price under these arrangements is variable in nature as certain credit provisions exist to the extent that the sports teams’ games are unavailable for broadcast during an individual league season.

The Company estimates the transaction price at the beginning of each fiscal year, which coincides with the annual contractual term.

In estimating the transaction price, the Company considers the contractually agreed upon license fees as well as qualitative considerations with respect to the number of games expected to be available for broadcast by MSG Networks over the upcoming year.

In estimating the transaction price, the Company considers the contractually agreed upon license fees as well as considerations with respect to the number of games expected to be available for broadcast by MSG Networks over the upcoming year.

The resulting transaction price is allocated entirely to the rights provided for the related contract year and revenue is recognized using an output measure of progress toward satisfaction of the Company’s performance obligations within the contract year, as the underlying benefits are conveyed to the licensee.

The Company’s professional sports teams also derive revenue from the distribution of league-wide national and international television contracts and other league-wide revenue sources.

The Company’s sports teams also derive revenue from the distribution of league-wide national and international television contracts and other league-wide revenue sources.

The transaction price for each of these revenues is based upon the expected distribution values as communicated by the applicable league.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table disaggregates the Company’s revenues by type of goods or services in accordance with the disclosure requirements per FASB ASC Subtopic 280-10-50-38 to 40 and the disaggregation of revenue required disclosures in accordance with ASC Subtopic 606-10-50-5 for the years ended June 30, 2022, 2021 and 2020:

The following table disaggregates the Company’s revenues by type of goods or services in accordance with the disclosure requirements per ASC Subtopic 280-10-50-38 to 40 and the disaggregation of revenue required disclosures in accordance with ASC Subtopic 606-10-50-5 for the years ended June 30, 2023, 2022 and 2021:

Years Ended June 30,

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Receivables from contracts with customers, net, excludes amounts recorded in Accounts receivable, net, associated with amounts due from the NBA and NHL related to escrow and luxury tax payments.

As of June 30, 2023, the Company had receivable balances related to escrow and player compensation recoveries of $ 1,544 recorded in Account s receivable, net.

As of June 30, 2022, the Company had receivable balances related to escrow and player compensation recover ies of $ 12,464 and $ 6,782 ,rec o rded in Accounts receivable, net and Other assets, respectively.

(b) Contract assets, which are reported as Other current assets in the Company’s consolidated balance sheets, primarily relate to the Company’s rights to consideration for goods or services transferred to the customer, for which the Company does not have an unconditional right to bill as of the reporting date.

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Deferred revenue is reduced and the related revenue is recognized once the underlying goods or services are transferred to the customer.

The non-current portion of deferred revenue primarily consists of a $ 30,000 receipt from the NBA in December 2020 of league distributions in advance of the Company’s recognition.

The non-current portion of deferred revenue primarily consists of amounts received from the NBA in December 2020 of league distributions in advance of the Company’s recognition.

The Company’s deferred revenue with MSG Networks was $ 0 , $ 0 and $ 260 as of June 30, 2023, 2022 and 2021, respectively.

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2023 2022 2021

Net income (loss) allocable to common shares, basic and diluted (numerator):

Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders $ 47,793 $ 51,131 $ ( 13,954 )

Dividends to other-than-common stockholders (a)

Net earnings (loss) allocable to common shares, basic and diluted (numerator):

$ 45,751 $ 51,131 $ ( 13,954 )

Weighted-average shares (denominator):

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Weighted-average shares excluded from diluted earnings (loss) per share — — 315

Basic earnings (loss) per common share attributable to Madison Square Garden Sports Corp’s stockholders $ 1.90 $ 2.11 $ ( 0.58 )

Diluted earnings (loss) per common share attributable to Madison Square Garden Sports Corp’s stockholders $ 1.89 $ 2.10 $ ( 0.58 )

(a) Dividends to other-than-common stockholders consists of forfeitable rights to dividends declared and payable to holders of the Company’s unvested restricted stock units and performance restricted stock units.

Team Personnel Transactions

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Team Personnel Transactions amounted to $ 4,412 , $ 737 and $ 44,242 for the years ended June 30, 2023, 2022 and 2021, respectively.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Cash, Cash Equivalent and Restricted Cash

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(a) See Note 2 for more information regarding the nature of restricted cash.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company’s leases primarily consist of the lease of the Company’s corporate offices under the Sublease Agreement with MSG Entertainment (the “Sublease Agreement”) for the Company’s principal executive offices at Two Pennsylvania Plaza in New York and the lease of CLG Performance Center.

In addition, the Company accounts for the rights of use of The Garden pursuant to the Arena License Agreements as leases under the ASC Topic 842, Leases .

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Variable lease costs for both operating and finance leases, if any, are recognized as incurred and such costs are excluded from lease balances recorded on the consolidated balance sheet.

On April 17, 2020, in connection with the MSGE Distribution, the Company entered into a sublease agreement with MSG Entertainment for the Company’s principal executive offices at Two Pennsylvania Plaza in New York.

The Company is party to a sublease agreement with MSG Entertainment for the Company’s principal executive offices at Two Pennsylvania Plaza in New York.

The sublease right of use assets and liabilities are recorded on the balance sheet at lease commencement based on the present value of minimum base rent and other fixed payments over the reasonably certain lease term.

In November 2021, MSG Entertainment entered into a new lease for principal executive offices at Two Pennsylvania Plaza in New York (the “New MSGE Lease Agreement”).

In November 2021, Sphere Entertainment entered into a new lease for principal executive offices at Two Pennsylvania Plaza in New York, which was assigned to MSG Entertainment in connection with the MSGE Distribution (the “New MSGE Lease Agreement”).

In accordance with the terms of the Sublease Agreement and the New MSGE Lease Agreement, the lease term of the Sublease Agreement was extended until October 31, 2024.

The Company has accounted for this extension as a lease remeasurement and remeasured the right-of-use asset and operating lease liability utilizing the Company’s incremental borrowing rate as of the date of remeasurement.

As a result of the remeasurement, non-cash additions to the right-of-use asset and operating lease liability of $ 1,244 were recorded during the fiscal year ended June 30, 2022.

The Company has accounted for this extension as a lease

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

remeasurement and remeasured the right-of-use asset and operating lease liability utilizing the Company’s incremental borrowing rate as of the date of remeasurement.

In accordance with the terms of the Sublease Agreement, the Company has committed to enter into a new sublease agreement with MSG Entertainment for a lease term equivalent to the New MSGE Lease Agreement term, which ends January 31, 2046.

1 unchanged sentence

As the Company has not yet entered into a new sublease for or taken possession of the new executive office space at Two Pennsylvania Plaza, no additional right-of-use assets or operating lease liabilities have been recorded as of June 30, 2023 related to the commitments discussed above.

In addition, in connection with the MSGE Distribution we entered into long term leases with MSG Entertainment through June 30, 2055 and allow the Knicks and the Rangers to play their home games at The Garden.

In addition, we are party to long term leases with MSG Entertainment through June 30, 2055 that allow the Knicks and the Rangers to play their home games at The Garden.

The Arena License Agreements provide for fixed payments to be made from inception through June 30, 2055 in 12 equal installments during each year of the contractual term.

The contracted license fee for the first full contract year ended June 30, 2021 was approximately $ 22,500 for the Knicks and

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

approximately $ 16,700 for the Rangers, and then for each subsequent year, the license fees are 103% of the license fees for the immediately preceding contract year .

At the time of the MSGE Distribution, the Garden was not available for use due to the government-mandated suspension of events in response to COVID-19.

As a result, the Company was not required to pay license fees to MSG Entertainment under the Arena License Agreements until games resumed at The Garden.

The contracted license fee for the first full contract year ended June 30, 2021 was approximately $ 22,500 for the Knicks and approximately $ 16,700 for the Rangers, and then for each subsequent year, the license fees are 103% of the license fees for the immediately preceding contract year.

At the time of the Sphere Distribution, The Garden was not available for use due to the government-mandated suspension of events in response to COVID-19.

As a result, the Company was not required to pay license fees under the Arena License Agreements until games resumed at The Garden.

On December 16, 2020 and January 14, 2021, respectively, the Knicks and the Rangers resumed playing their homes games at The Garden as part of their 2020-21 seasons.

1 unchanged sentence

Effective February 23, 2021, New York venues with at least a 10,000-person capacity were permitted to operate at 10% capacity, and the Knicks and the Rangers began playing games at The Garden with a limited number of fans in attendance on February 23 and 26, 2021, respectively.

When games were played at The Garden by the Knicks and the Rangers either without fans in attendance or with limited fans in attendance due to government mandated capacity constraints, the applicable license fees to MSG Entertainment under the Arena License Agreements were substantially reduced.

When games were played at The Garden by the Knicks and the Rangers either without fans in attendance or with limited fans in attendance due to government mandated capacity constraints, the applicable license fees under the Arena License Agreements were substantially reduced.

Effective May 19, 2021, event venues such as The Garden were permitted to host guests at full capacity, subject to certain restrictions, including, for example, restrictions for unvaccinated guests.

As a result, the Knicks played three home playoff games with ticket sales of approximately 15,000 - 16,500 per game during the fiscal year ended June 30, 2021.

As a result of the unique circumstances due to COVID-19 during the prior season, the Company agreed to make certain variable lease payments to MSG Entertainment associated with the Knicks playoff games during the 2021 NBA playoffs.

As a result of the unique circumstances due to COVID-19 during the prior season, the Company agreed to make certain variable lease payments associated with the Knicks playoff games during the 2021 NBA playoffs.

Costs associated with such payments were considered variable lease costs for the year ended June 30, 2021.

Effective July 1, 2021, the Company began paying license fees to MSG Entertainment under the Arena License Agreements in their full contractual amounts.

The Knicks and the Rangers are entitled to use The Garden on home game days, which are usually nonconsecutive, for a pre-defined period of time from before and after the game.

Effective July 1, 2021, the Company began paying license fees under the Arena License Agreements in their full contractual amounts.

The Knicks and the Rangers are entitled to use The Garden on home game days, which are usually nonconsecutive, for a pre-defined period of time before and after the game.

In evaluating the Company’s lease cost, the Company considered the timing of payments throughout the lease terms and the nonconsecutive periods of use, provided for within each license.

1 unchanged sentence

As such, the Company concluded that the related straight-line operating lease costs should be recorded by each team equally over each team’s individual event days.

In June 2023, the Company entered into a lease agreement for an aircraft with a term through December 30, 2031.

The lease right of use asset and liability were recorded in the Company’s accompanying consolidated balance sheet as of June 30, 2023 based on the present value of minimum lease fixed payments over the lease term utilizing the Company’s incremental borrowing rate as of the lease commencement date.

As of June 30, 2023, the Company’s existing operating leases, which are recorded in the accompanying consolidated financial statements, have remaining lease terms ranging from 4 months to 32 years.

15 unchanged sentences

(a) As of June 30, 2023, Operating lease liabilities, current and Operating leases liabilities, noncurrent included balances of $ 43,700 and $ 707,124 , respectively, that are payable to MSG Entertainment.

As of June 30, 2021, Operating lease liabilities, current and Operating leases liabilities, noncurrent included balances of $ 41,541 and $ 690,792 , respectively, that are payable to MSG Entertainment.

As of June 30, 2022, Operating lease liabilities, current and Operating leases liabilities, noncurrent included balances of $ 43,028 and $ 699,587 , respectively, that were payable to Sphere Entertainment.

The following table summarizes the activity recorded within the Company’s consolidated statement of operations for the years ended June 30, 2023, 2022, and 2021:

7 unchanged sentences

Total lease cost $ 70,870 $ 70,922 $ 39,576

(a) As a result of the unique circumstances due to COVID-19 during the prior season, the Company agreed to make certain variable lease payments to MSG Entertainment associated with the Knicks playoff games during the 2021 NBA playoffs.

(a) As a result of the unique circumstances due to COVID-19, the Company agreed to make certain variable lease payments to Sphere Entertainment associated with the Knicks playoff games during the 2021 NBA playoffs.

Supplemental Information

For the years ended June 30, 2023 and 2022, cash paid for amounts included in the measurement of lease liabilities was $ 44,986 and $ 43,846 , respectively.

For the years ended June 30, 2023 and 2022, non-cash additions to right-of-use assets and operating lease liabilities was $ 45,357 and $ 1,244 , respectively.

The weighted average remaining lease term for operating leases recorded on the accompanying consolidated balance sheet as of June 30, 2023 and 2022 was 30.5 years and 32.7 years, respectively.

The weighted average discount rate was 7.13 % as of June 30, 2022 and 2021, and represented the Company’s estimated incremental borrowing rate, assuming a secured borrowing, based on the remaining lease term at the time of either (i) adoption of the standard or (ii) the period in which the lease term expectation commenced or was modified .

The weighted average discount rate was 7.10 % and 7.13 % as of June 30, 2023 and 2022, respectively, and represented the Company’s estimated incremental borrowing rate, assuming a secured borrowing, based on the remaining lease term at the time of either (i) adoption of the standard or (ii) the period in which the lease term expectation commenced or was modified .

MADISON SQUARE GARDEN SPORTS CORP.

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Buildings 51,465 51,444 Up to 45 years

Equipment 21,042 18,239 1 year to 20 years

Equipment 21,587 21,042 2 years to 20 years

Furniture and fixtures 631 786 4 years to 10 years

5 unchanged sentences

$ 30,501 $ 32,892

Depreciation and amortization expense on property and equipment for continuing operations was $ 3,982 , $ 4,515 and $ 13,979 for the years ended June 30, 2022, 2021 and 2020, respectively, which, prior to the MSGE Distribution, includes depreciation expense on certain corporate property and equipment that was transferred to MSG Entertainment in connection with the MSGE Distribution, but which did not qualify for discontinued operations reporting.

Depreciation and amortization expense on property and equipment was $ 3,410 , $ 3,982 and $ 4,515 for the years ended June 30, 2023, 2022 and 2021, respectively .

Goodwill and Intangible Assets

1 unchanged sentence

The Company’s goodwill is $ 226,523 and $ 226,955 as of June 30, 2023 and 2022, respectively.

The decrease in goodwill was attributable to the Company’s disposal of CLG in April 2023.

The Company’s indefinite-lived intangible assets as of June 30, 2023 and 2022 are as follows:

4 unchanged sentences

During the first quarter of fiscal year 2023, the Company performed its annual impairment test of identifiable indefinite-lived intangible assets and determined that there were no impairments identified.

The decrease in the indefinite-lived intangible assets was attributable to the Company’s disposal of CLG in April 2023.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company’s intangible assets subject to amortization are as follows:

June 30, 2022 Estimated Useful Lives Gross Accumulated

Amortization Net

Trade names 5 years $ 2,300 $ ( 2,262 ) $ 38

Non-compete agreements 5 years 2,400 ( 2,360 ) 40

Other intangibles 3 years to 9.75 years 1,200 ( 642 ) 558

$ 5,900 $ ( 5,264 ) $ 636

The Company had no intangible assets subject to amortization as of June 30, 2023 as a result of the disposal of CLG in April 2023.

The Company’s intangible assets subject to amortization as of June 30, 2022 were as follows:

June 30, 2022 Gross Accumulated

5 unchanged sentences

Amortization expense for intangible assets was $ 167 , $ 1,059 , and $ 1,059 for the years ended June 30, 2023, 2022 and 2021, respectively.

The Company expects its aggregate annual amortization expense for existing intangible assets subject to amortization for each fiscal year from 2023 through 2027 to be as follows:

Fiscal year ending June 30, 2023 $ 195

Fiscal year ending June 30, 2024 115

Fiscal year ending June 30, 2025 115

Fiscal year ending June 30, 2026 115

Fiscal year ending June 30, 2027 96

The Company’s investments in nonconsolidated affiliates which are accounted for under the equity method of accounting, equity investments with readily determinable fair values, equity investments without readily determinable fair values, and derivative instruments, which are reported within Investments in the accompanying consolidated balance sheets consisted of the following:

Equity method investments:

Equity investments with readily determinable fair values:

Xtract One Technologies Inc.

(“Xtract One”) common stock 22,408

Other equity investments with readily determinable fair values 14,406

Equity investments without readily determinable fair values (a)

Derivative instruments:

Xtract One warrants 13,098

Total investments $ 67,374

Equity investments with readily determinable fair values:

Other equity investments with readily determinable fair values $ 2,736

Equity investments without readily determinable fair values (a)

Total investments $ 4,736

_________________

(a) For the years ended June 30, 2023 and 2022, the Company did not have any impairment charges or changes in carrying value recorded to its equity securities without readily determinable fair values .

Equity Method Investments

The Company determined that it has the ability to exert significant influence over the investee and therefore accounts for these investments under the equity method of accounting.

In April 2023, the Company sold its controlling interest in CLG to NRG, a professional gaming and entertainment company in exchange for a noncontrolling equity interest in the combined NRG/CLG company.

The Company received preferred shares representing approximately 25 % of the capital stock of NRG.

The Company recorded the investment in NRG at fair value as an equity method investment.

The Company deconsolidated the CLG business in the fourth fiscal quarter of 2023 and recorded a loss of $ 1,031 within Miscellaneous income (expense) , net within the Company’s consolidated statement of operations for the year ended June 30, 2023.

As of June 30, 2023, the Company’s ownership in NRG was approximately 25 %.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Equity Investments with Readily Determinable Fair Values

The Company holds investments in equity instruments with readily determinable fair value, which are included within Investments in the accompanying consolidated balance sheets, including the following:

• Xtract One, a technology-driven threat detection and security solution company that is listed on the Toronto Stock Exchange under the symbol “XTRA”.

The Company holds common stock of Xtract One and holds warrants entitling the Company to acquire additional shares of common stock of Xtract One which are considered derivative instruments.

Refer to Note 11 for further details regarding the Company’s warrants, including the inputs used in determining the fair value of the warrants.

• Other equity investments held in trust under the Company’s Executive Deferred Compensation Plan.

Refer to Note 14 for further details regarding the plan.

The fair value of the Company’s investments in common stock of Xtract One and other investments held in trust are determined based on quoted market prices in active markets, which are classified within Level I of the fair value hierarchy.

The cost basis and carrying value of equity investments with readily determinable fair values are as follows:

June 30, 2023

Cost Basis Carrying Value / Fair Value

Xtract One common stock $ 6,783 $ 22,408

Other equity investments with readily determinable fair values 13,772 14,406

$ 20,555 $ 36,814

June 30, 2022

Cost Basis Carrying Value / Fair Value

Other equity investments with readily determinable fair values $ 3,197 $ 2,736

$ 3,197 $ 2,736

The following table summarizes the realized and unrealized gains on equity investments with readily determinable fair values, recorded within Miscellaneous income (expense), net within the Company’s consolidated statement of operations, for the years ended June 30, 2023 and 2022.

The Company did not have any investments in the year ended June 30, 2021, and therefore no gains or losses were recorded.

Years Ended June 30,

Unrealized gain - Xtract One common stock $ 15,625 $ —

Unrealized gain (loss) - other equity investments with readily determinable fair values 1,095 ( 461 )

Realized loss - other equity investments with readily determinable fair values ( 4 ) —

$ 16,716 $ ( 461 )

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Fair Value Measurements

4 unchanged sentences

Equity investments I 36,814 2,736

Warrants III 13,098 —

Total assets measured at fair value $ 68,699 $ 84,836

Assets listed above are classified within Level I of the fair value hierarchy as they are valued using observable inputs that reflect quoted prices for identical assets in active markets.

Level I Inputs

Assets that are classified within Level I of the fair value hierarchy and are valued using observable inputs that reflect quoted prices for identical assets in active markets.

The carrying amount of the Company’s money market accounts and time deposit approximates fair value due to their short-term maturities.

Refer to Note 10 for further details regarding equity investments.

Level III Inputs

The Company’s level III assets consist of warrants entitling the Company to acquire additional common shares of Xtract One.

The Company’s warrants are included within Investments in the accompanying consolidated balance sheets.

The fair value of the Company’s warrants in Xtract One were determined using the Black-Scholes option pricing model.

The following are key assumptions used to calculated the fair value of the warrants as of June 30, 2023:

Expected term 2.34 years

Expected volatility 74.43 %

Risk-free interest rate 4.68 %

The following table presents additional information about our assets for which we utilize Level III inputs to determine fair value:

Year Ended June 30,

Balance at beginning of period $ —

Purchase of warrants 3,257

Unrealized gains on warrants 9,841

Balance at ending of period $ 13,098

MADISON SQUARE GARDEN SPORTS CORP.

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(a) The Company’s debt, current is classified within Level II of the fair value hierarchy as it is valued using quoted indices of similar securities for which the inputs are readily observable.

The fair value of the Company’s debt, current is the same as its carrying amount as the advance bears interest at a variable rate indexed to current market conditions.

The fair value of the Company’s debt, current is the same as its carrying amount based on valuation of similar securities.

See Note 13 for further details.

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_________________

(a) Consist principally of the Company’s obligations under employment agreements that the Company has with its professional sports teams’ personnel that are generally guaranteed regardless of employee injury or termination.

(b) Consist primarily of amounts earned under employment agreements that the Company has with certain of its professional sports teams’ personnel.

(a) Consist principally of the Company’s obligations under employment agreements that the Company has with its sports teams’ personnel that are generally guaranteed regardless of employee injury or termination.

(b) Consist primarily of amounts earned under employment agreements that the Company has with certain of its sports teams’ personnel.

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Knicks LLC is required to pay a commitment fee ranging from 0.250 % to 0.300 % per annum in respect of the average daily unused commitments under the 2021 Knicks Revolving Credit Facility.

During the year ended June 30, 2023, the Company borrowed an additional $ 55,000 and made principal repayments of $ 40,000 under the 2021 Knicks Revolving Credit Facility.

The outstanding balance under the 2021 Knicks Revolving Credit Facility was $ 235,000 as of June 30, 2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet.

The interest rate on the 2021 Knicks Revolving Credit Facility as of June 30, 2023 was 6.43 %.

During the year ended June 30, 2022 the Company made interest payments of $ 3,341 in respect of the 2021 Knicks Revolving Credit Facility (including in respect of obligations under the 2020 Knicks Credit Agreement prior to the amendment and restatement thereof).

All obligations under the 2021 Knicks Revolving Credit Facility are secured by a first lien security interest in certain of Knicks LLC’s assets, including, but not limited to, (i) the Knicks LLC’s membership rights in the NBA, (ii) revenues to be paid to the Knicks LLC by the NBA pursuant to certain U.S.

During the year ended June 30, 2023 the Company made interest payments of $ 13,085 in respect of the 2021 Knicks Revolving Credit Facility.

In addition, on July 10, 2023, the Company borrowed an additional $ 25,000 under the 2021 Knicks Revolving Credit Facility.

national broadcast agreements, and (iii) revenues to be paid to Knicks LLC pursuant to local media contracts.

1 unchanged sentence

Knicks LLC is required to make mandatory prepayments in certain circumstances, including without limitation if the maximum available amount under the 2021 Knicks Revolving Credit Facility is greater than 350 % of qualified revenues.

In addition to the financial covenant described above, the 2021 Knicks Credit Agreement and related security agreements contain certain customary representations and warranties, affirmative covenants and events of default.

In addition to the financial covenant described above, the 2021 Knicks Credit Agreement and related security agreement contain certain customary representations and warranties, affirmative covenants and events of default.

The 2021 Knicks Revolving Credit Facility contains certain restrictions on the ability of Knicks LLC to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the 2021 Knicks Revolving Credit Facility, including the following:

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Rangers LLC is required to pay a commitment fee ranging from 0.375 % to 0.625 % per annum in respect of the average daily unused commitments under the 2021 Rangers Revolving Credit Facility.

During the year ended June 30, 2022, the Company made principal payments of $ 135,000 .

There was no borrowing under the 2021 Rangers Revolving Credit Facility as of June 30, 2022.

During the year ended June 30, 2023, the Company borrowed $ 160,000 and made principal repayments of $ 100,000 under the 2021 Rangers Revolving Credit Facility.

The outstanding balance under the 2021 Rangers Revolving Credit Facility was $ 60,000 as of June 30, 2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet.

The interest rate on the 2021 Rangers Revolving Credit Facility as of June 30, 2023 was 6.95 %.

During the year ended June 30, 2022 the Company made interest payments of $ 2,127 in respect of the 2021 Rangers Revolving Credit Facility (including in respect of obligations under the 2020 Rangers Credit Agreement prior to the amendment and restatement thereof).

During the year ended June 30, 2023 the Company made interest payments of $ 4,911 in respect of the 2021 Rangers Revolving Credit Facility.

All obligations under the 2021 Rangers Revolving Credit Facility are, subject to the 2021 Rangers NHL Advance Agreement (as defined below), secured by a first lien security interest in certain of Rangers LLC’s assets, including, but not limited to, (i) Rangers LLC’s membership rights in the NHL, (ii) revenues to be paid to Rangers LLC by the NHL pursuant to certain U.S.

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Rangers LLC is required to make mandatory prepayments in certain circumstances, including without limitation if qualified revenues are less than 17 % of the maximum available amount under the 2021 Rangers Revolving Credit Facility.

In addition to the financial covenant described above, the 2021 Rangers Credit Agreement and related security agreements contain certain customary representations and warranties, affirmative covenants and events of default.

In addition to the financial covenant described above, the 2021 Rangers Credit Agreement and related security agreement contain certain customary representations and warranties, affirmative covenants and events of default.

The 2021 Rangers Revolving Credit Facility contains certain restrictions on the ability of Rangers LLC to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the 2021 Rangers Revolving Credit Facility, including the following:

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The following table summarizes deferred financing costs, net of amortization, related to the Company’s credit facilities as reported on the accompanying consolidated balance sheets:

2023 June 30,

Other current assets $ 1,145 $ 1,145

Other assets 2,810 3,954

(a) In connection with the 2021 Knicks Revolving Credit Facility and 2021 Rangers Revolving Credit Facility, the Company incurred $ 2,836 in deferred financing costs during the year ended June 30, 2022.

Benefit Plans

Defined Benefit Pension Plans and Postretirement Benefit Plans

Prior to the MSGE Distribution, the Company sponsored a non-contributory, qualified cash balance retirement plan covering its non-union employees (the “Cash Balance Pension Plan”) and an unfunded non-contributory, non-qualified excess cash balance plan (the “Excess Cash Balance Plan”) covering certain employees who participate in the underlying qualified plan (collectively, the “Cash Balance Plans”).

Since March 1, 2011, the Cash Balance Pension Plan has also included the assets and liabilities of a frozen (as of December 31, 2007) non-contributory qualified defined benefit pension plan covering non-union employees hired prior to January 1, 2001.

Also, the Company historically sponsored an unfunded non-contributory, non-qualified defined benefit pension plan for the benefit of certain employees who participate in the underlying qualified plan which was merged into the Cash Balance Pension Plan on March 1, 2011 (the “Excess Plan”).

As of December 31, 2007, the Excess Plan was amended to freeze all benefits earned through December 31, 2007 and to eliminate the ability of participants to earn benefits for future service under these plans.

The Cash Balance Plans were amended to freeze participation and future benefit accruals effective December 31, 2015 for all employees.

Therefore, after December 31, 2015, no employee of the Company who was not already a participant may become a participant in the plans and no further annual pay credits will be made for any future year.

Existing account balances under the plans will continue to be credited with monthly interest in accordance with the terms of the plans.

Prior to the MSGE Distribution the Company sponsored a non-contributory, qualified defined benefit pension plan covering certain of its union employees (the “Union Plan”).

Benefits payable to retirees under the Union Plan are based upon years of Benefit Service (as defined in the Union Plan document).

The Cash Balance Plans, Union Plan, and Excess Plan are collectively referred to as the “MSGE Pension Plans.”

In addition, the Company also sponsored a contributory welfare plan which provided certain postretirement healthcare benefits to certain employees hired prior to January 1, 2001 who are eligible to commence receipt of early or normal benefits under the Cash Balance Pension Plan and their dependents, as well as certain union employees (“Postretirement Plan”).

As of the MSGE Distribution Date the Company and MSG Entertainment entered into an employee matters agreement (the “Employee Matters Agreement”) which determined each company’s obligations after the MSGE Distribution with regard to historical liabilities under the Company’s former pension and postretirement plans.

Under the Employee Matters Agreement, the

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MSGE Pension Plans and Postretirement Plan were transferred to MSG Entertainment.

However, the Company has retained liabilities from the Excess Cash Balance Plan and Excess Plan that related to its current employees, former employees (other than employees transferred to MSG Entertainment in connection with the MSGE Distribution) and employees that are employed in a senior executive capacity by both the MSG Sports and MSG Entertainment.

Such liabilities were transferred to the MSG Sports, LLC Excess Cash Balance Plan (the “MSGS Excess Cash Balance Plan”) and MSG Sports, LLC Excess Retirement Plan (the “MSGS Excess Retirement Plan”), which the Company established in connection with the MSGE Distribution and are collectively referred to the “MSGS Pension Plans”.

The following table summarizes the projected benefit obligations, assets, and the amounts recorded on the Company’s consolidated balance sheets as of June 30, 2022 and 2021, associated with the MSGS Pension Plans based upon actuarial valuations as of those measurement dates.

Defined Benefit Pension Plans

The Company sponsors the MSG Sports, LLC Excess Cash Balance Plan (the “Excess Cash Balance Plan”), an unfunded non-contributory, non-qualified excess cash balance plan and the MSG Sports, LLC Excess Retirement Plan, an unfunded non-contributory, non-qualified defined benefit pension plan for the benefit of certain employees (collectively referred to as “Pension Plans”).

All benefits in the Company’s Pension Plans are frozen and participants are not able to earn benefits for future service under these plans, and no employee of the Company who was not already a participant as of the date the respective plan was frozen may become a participant in the Pension Plans.

Existing account balances under the Excess Cash Balance Plan are credited with monthly interest in accordance with the terms of the plan.

The following table summarizes the projected benefit obligations and the amounts recorded on the Company’s consolidated balance sheets as of June 30, 2023 and 2022, associated with the Pension Plans based upon actuarial valuations as of those measurement dates.

Change in benefit obligation:

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Interest cost 239 123

Actuarial loss (gain) ( 1,078 ) 38

Actuarial gain ( 215 ) ( 1,078 )

Benefits paid ( 248 ) ( 248 )

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The actuarial gain of $ 215 , included in the change in benefit obligation for pension benefits in the year ended June 30, 2023, is primarily the result of increases in the discount rate and demographic experience as of June 30, 2023.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Amounts recognized in the consolidated balance sheets as of June 30, 2023 and 2022 consist of:

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Actuarial loss $ ( 543 ) $ ( 807 )

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table presents components of net periodic benefit cost for the MSGE Pension Plans, MSGS Pension Plans and Postretirement Plan included in the accompanying consolidated statements of operations for the years ended June 30, 2022, 2021 and 2020.

Service cost is recognized in direct operating expenses and selling, general and administrative expenses.

All other components of net periodic benefit cost are reported in Miscellaneous income (expense), net.

MSGE Pension Plans & MSGS Pension Plans Postretirement Plan

Years Ended June 30, Years Ended June 30,

The following table presents components of net periodic benefit cost for the Pension Plans included in the accompanying consolidated statements of operations for the years ended June 30, 2023, 2022 and 2021.

Components of net periodic benefit cost are reported in Miscellaneous income (expense), net .

Years Ended June 30,

2023 2022 2021

Service cost $ — $ — $ 75 $ — $ — $ 44

Interest cost $ 239 $ 123 $ 145

Expected return on plan assets — — ( 4,240 ) — — —

Recognized actuarial loss 18 133 103

Settlement loss recognized (a)

9 47 67 — — —

Net periodic benefit cost $ 287 $ 265 $ 295

_________________

(a) For the years ended June 30, 2022, 2021 and 2020, lump-sum payments totaling $ 83 , $ 328 and $ 551 , respectively, were distributed to vested participants of the non-qualified excess cash balance plan, triggering the recognition of settlement losses in accordance with ASC Topic 715.

Due to these pension settlements, the Company was required to remeasure its pension plan liability as of June 30, 2022, June 30, 2021, and March 31, 2020 for the years ended June 30, 2022, 2021 and 2020, respectively.

(a) For the years ended June 30, 2023, 2022 and 2021, lump-sum payments totaling $ 253 , $ 83 and $ 328 , respectively, were distributed to vested participants of the Excess Cash Balance Plan, triggering the recognition of settlement losses in accordance with ASC Topic 715.

Due to these pension settlements, the Company was required to remeasure its pension plan liability as of June 30, 2023, June 30, 2022, and June 31, 2021 for the years ended June 30, 2023, 2022 and 2021, respectively.

Discount rates used for the projected benefit obligation and interest cost were 4.38 % and 2.97 % as of June 30, 2023, respectively, 1.89 % and 0.86 % as of June 30, 2022, respectively, and 1.73 % and 0.91 % as of June 30, 2021, respectively.

Additionally, settlement charges of $ 30 , $ 9 and $ 47 were recognized in Miscellaneous income (expense), net for the years ended June 30, 2023, 2022 and 2021, respectively.

Amounts presented in the table above include net periodic benefit cost related to continuing operations and discontinued operations as noted in the following table:

MSGE Pension Plans & MSGS Pension Plans Postretirement Plan

Years Ended June 30, Years Ended June 30,

2022 2021 2020 2022 2021 2020

Continuing Operations $ 265 $ 295 $ 395 $ — $ — $ —

Discontinued Operations — — 722 — — 135

Total net periodic benefit cost $ 265 $ 295 $ 1,117 $ — $ — $ 135

Other pre-tax changes in plan assets and benefit obligations recognized in other comprehensive income (loss) for the years ended June 30, 2022, 2021 and 2020 are as follows:

MSGE Pension Plans & MSGS Pension Plans Postretirement Plan

Years Ended June 30, Years Ended June 30,

Other pre-tax changes benefit obligations recognized in other comprehensive income (loss) for the years ended June 30, 2023, 2022 and 2021 are as follows:

Years Ended June 30,

2023 2022 2021

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Settlement loss recognized

9 47 67 — — —

Transfer due to the MSGE Distribution

— — 37,049 — — 749

Total recognized in other comprehensive income (loss) $ 263 $ 1,220 $ 112

$ 1,220 $ 112 $ 37,725 $ — $ — $ 754

Funded Status

As a result of the MSGE Distribution, effective the MSGE Distribution Date, the Company sponsors only unfunded non-contributory pension plans.

MADISON SQUARE GARDEN SPORTS CORP.

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Weighted-average assumptions used to determine net periodic benefit cost (made at the beginning of the period) for the years ended June 30, 2023, 2022 and 2021 are as follows:

MSGE Pension Plans & MSGS Pension Plans Postretirement Plan

Years Ended June 30, Years Ended June 30,

Years Ended June 30,

2023 2022 2021

Discount rate - projected benefit obligation 2.35 % 2.35 % 3.58 % n/a n/a 3.18 %

Discount rate - service cost n/a n/a 3.78 % n/a n/a 3.45 %

Discount rate - interest cost 1.84 % 1.84 % 3.10 % n/a n/a 2.84 %

Expected long-term return on plan assets

n/a n/a 5.52 % n/a n/a n/a

Healthcare cost trend rate assumed for next year

n/a n/a n/a n/a n/a 6.75 %

Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)

n/a n/a n/a n/a n/a 5.00 %

Year that the rate reaches the ultimate trend rate

n/a n/a n/a n/a n/a 2027

Discount rate - projected benefit obligation 4.60 % 2.35 % 2.35 %

Discount rate - interest cost 4.27 % 1.84 % 1.84 %

The discount rates were determined (based on the expected duration of the benefit payments for the plans) from the Willis Towers Watson U.S.

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This model was developed by examining the yields on selected highly rated corporate bonds.

The expected long-term return on plan assets is based on a periodic review and modeling of the plans’ asset allocation structures over a long-term horizon.

Expectations of returns for each asset class are the most important of the assumptions used in the review and modeling and are based on comprehensive reviews of historical data, forward-looking economic outlook, and economic/financial market theory.

The expected long-term rate of return was selected from within the reasonable range of rates determined by (a) historical real returns, net of inflation, for the asset classes covered by the investment policy and (b) projections of inflation over the long-term period during which benefits are payable to plan participants.

Plan Assets and Investment Policy

As discussed above, in connection with the MSGE Distribution, the Company only retained liabilities associated with unfunded and unqualified pension plans.

Thus, the MSGS Pension Plans did not carry any investments as of June 30, 2022 and June 30, 2021.

Estimated Future Benefit Payments

The following table presents estimated future fiscal year benefit payments for the MSGS Pension Plans:

The following table presents estimated future fiscal year benefit payments:

Fiscal year ending June 30, 2024 $ 3,409

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Defined Contribution Pension Plans

Prior to the MSGE Distribution, the Company sponsored The Madison Square Garden 401(k) Savings Plan (the “401(k) Plan”), which is a multiple employer plan and the MSG S&E, LLC Excess Savings Plan (collectively referred to as the “Savings Plans”) and The Madison Square Garden 401(k) Union Plan (the “Union Savings Plan”), which is also a multiple employer plan.

As a result of the MSGE Distribution, the Savings Plans and Union Savings Plan were transferred to MSG Entertainment.

However, MSG Sports employees continue to participate in the 401(k) Plan.

In addition, pursuant to the Employee Matters Agreement the Company established MSG Sports LLC Excess Savings Plan to provide non-qualified retirement benefits to eligible MSG Sports employees and assumed the liabilities associated with MSG Sports employees as of the MSGE Distribution Date of the MSG S&E, LLC Excess Savings Plan.

Expenses related to the Savings Plans that are included in the accompanying consolidated statements of operations for the years ended June 30, 2022, 2021 and 2020 are as follows:

Years Ended June 30,

2022 2021 2020

Continuing Operations $ 4,956 $ 2,310 $ 4,674

Discontinued Operations — — 1,411

Total Savings Plan Expenses $ 4,956 $ 2,310 $ 6,085

For the year ended June 30, 2020, expenses related to the Union Savings Plan included in the accompanying consolidated statements of operations were $ 526 and have been classified in the consolidated statements of operations as discontinued operations.

MSG Sports employees participate in The Madison Square Garden 401(k) Savings Plan (the “401(k) Plan”), which is a multiple employer plan sponsored by MSG Entertainment Holdings, LLC, a wholly owned subsidiary of MSG Entertainment.

In addition, the Company sponsors the MSG Sports LLC Excess Savings Plan (the “Excess Savings Plan”), which provides non-qualified retirement benefits to eligible MSG Sports employees.

Expense related to the 401(k) Plan and Excess Savings Plan was $ 4,897 , $ 4,956 , and $ 2,310 for the years ended June 30, 2023, 2022, and 2021, respectively.

Multiemployer Plans

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Executive Deferred Compensation Plan

On November 16, 2021, the Company established the Madison Square Garden Sports Corp.

Executive Deferred Compensation Plan (the “Deferred Compensation Plan”) for the purpose of permitting a select group of highly-compensated employees to defer the employee’s annual base salary and bonus into the Deferred Compensation Plan with returns on such deferrals tracking the performance of certain investments.

The Company sponsors the Madison Square Garden Sports Corp.

Executive Deferred Compensation Plan (the “Deferred Compensation Plan”), which was established in November 2021, for the purpose of permitting a select group of highly-compensated employees to defer the employee’s annual base salary and bonus into the Deferred Compensation Plan with returns on such deferrals tracking the performance of certain investments.

Amounts deferred and invested by employees under the Deferred Compensation Plan are placed in an irrevocable trust established by the Company and all assets of the trust are subject to the creditors of the Company in the event of insolvency.

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The Company remeasures the fair value of the assets held in trust in accordance with ASC Topic 321, Investments – Equity Securities , and recognizes unrealized gains and losses in Miscellaneous income (expense), net in the Company’s consolidated statements of operations.

For the year ended June 30, 2022 the Company recorded compensation cost of $ 461 within Selling, general and administrative expenses to reflect the remeasurement of the Deferred Compensation Plan liability.

In addition, for the year ended June 30, 2022, the Company recorded gains of $ 461 within Miscellaneous income (expense), net to reflect the remeasurement of the fair value of assets under the Deferred Compensation Plan.

Amounts recognized in the consolidated balance sheets as of June 30, 2022 related to the Deferred Compensation Plan consist of:

Non-current assets (included in other assets)

The Company recorded compensation expense/(compensation cost credits) of $ 1,091 and $( 461 ), for the years ended June 30, 2023 and 2022, respectively, within Selling, general and administrative expenses to reflect the remeasurement of the Deferred Compensation Plan liability.

In addition, the Company recorded gains/(losses) of $ 1,091 and $( 461 ), for the years ended June 30, 2023 and 2022, respectively, within Miscellaneous income (expense), net to reflect the remeasurement of the fair value of assets under the Deferred Compensation Plan.

Amounts recognized in the consolidated balance sheets as of June 30, 2023 and 2022 related to the Deferred Compensation Plan consist of:

June 30, June 30,

Non-current assets (included in investments)

$ 14,406 $ 2,736

Current liabilities (included in accrued employee related costs)

( 1,358 ) ( 123 )

Non-current liabilities (included in other employee related costs)

( 13,048 ) ( 2,613 )

MADISON SQUARE GARDEN SPORTS CORP.

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Unless otherwise provided in an applicable award agreement, restricted stock units granted under this plan will be fully vested, upon the date of grant and will settle in shares of the Company’s 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’s service on the Board of Directors ceases or, if earlier, upon the director’s death.

In connection with the MSGE Distribution, pursuant to the terms of the incentive plans and award agreements, (i) each holder of an RSU and PSU granted under the Employee Stock Plan 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 a share of the Company’s Class A Common Stock (or cash or other property) 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 Non-Employee Director Plan, which remain outstanding and continue to be entitled to a share of the Company’s Class A Common Stock (or cash or other property) 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 volume-weighted average prices of the MSG Entertainment Class A Common Stock and the Company’s Class A Common Stock using the 10 -day volume weighted average trading price immediately following the MSGE Distribution, 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 the existing options in connection with the MSGE Distribution.

The Company’s RSUs/PSUs and/or stock options held by individuals who are solely MSG Entertainment employees will not be expensed by the Company;

In connection with the Sphere Distribution, pursuant to the terms of the incentive plans and award agreements, (i) each holder of an RSU and PSU granted under the Employee Stock Plan received one Sphere Entertainment RSU or PSU in respect of every one Company RSU or PSU owned on the Record Date and continues to be entitled to a share of the Company’s Class A Common Stock (or cash or other property) for each Company RSU or PSU in accordance with the existing award agreement, (ii) one share of Sphere Entertainment Class A Common Stock was issued under the Sphere Entertainment Non-Employee Director Plan in respect of every one RSU outstanding under the Company’s Non-Employee Director Plan, which remain outstanding and continue to be entitled to a share of the Company’s Class A Common Stock (or cash or other property) 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 Sphere 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 Sphere Entertainment options based upon the volume-weighted average prices of the Sphere Entertainment Class A Common Stock and the Company’s Class A Common Stock using the 10 -day volume weighted average trading price immediately following the Sphere Distribution, and the underlying share amount was consistent with the one -to-one distribution ratio in the Sphere Distribution.

Other than the split of the options and the allocation of the existing exercise price, there were no additional adjustments to the existing options in connection with the Sphere Distribution.

The Company’s RSUs/PSUs and/or stock options held by individuals who are solely Sphere Entertainment or MSG Entertainment employees will not be 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.

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ended June 30, 2023, 2022 and 2021 was $ 25,203 , $ 24,245 and $ 30,437 , respectively.

There were no costs related to share-based compensation in continuing operations that were capitalized for the years ended June 30, 2022, 2021 and 2020.

There were no costs related to share-based compensation in operations that were capitalized for the years ended June 30, 2023, 2022 and 2021.

As of June 30, 2023, there was $ 14,439 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 2.0 years for unvested RSUs and PSUs.

Share-based compensation expense for discontinued operations during the year ended June 30, 2020 was $ 8,303 .

As a result of an agreement to settle an action (the “Settlement”) filed by a purported stockholder of the Company derivatively on behalf of the Company against certain directors of the Company who are members of the Dolan family and against the directors of the Company who were members of the Compensation Committee, Mr.

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Restricted Stock Units Award Activity

The following table summarizes activity related to the Company’s RSUs and PSUs, held by the Company and MSG Entertainment employees, for the year ended June 30, 2022:

The following table summarizes activity related to the Company’s RSUs and PSUs, held by the Company Sphere Entertainment, and MSG Entertainment employees, for the year ended June 30, 2023:

Number of Weighted-Average

Date of Grant (a)

Nonperformance

RSUs PSUs and Performance

Unvested award balance as of June 30, 2022 199 189 $ 198.21

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_________________

(a) Weighted-average fair value per share at date of grant does not reflect any adjustment associated with the MSGE Distribution.

See above for a discussion of the treatment of RSUs and PSUs in connection with the MSGE Distribution.

(a) Weighted-average fair value per share at date of grant does not reflect any adjustment associated with the Sphere Distribution.

See above for a discussion of the treatment of RSUs and PSUs in connection with the Sphere Distribution.

The fair value of RSUs and PSUs that vested during the year ended June 30, 2023 was $ 40,944 .

Upon delivery, RSUs and PSUs granted under the 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, 105 of these RSUs and PSUs, with an aggregate value of $ 18,306 , inclusive of $ 6,164 related to MSG Entertainment employees (who vested in the Company’s RSUs and PSUs), were retained by the Company and the taxes paid are reflected as financing activity in the accompanying consolidated statement of cash flows for the year ended June 30, 2022.

To fulfill the employees’ statutory minimum tax withholding obligations for the applicable income and other employment taxes, 117 of these RSUs and PSUs, with an aggregate value of $ 17,897 , inclusive of $ 4,233 related to Sphere Entertainment and MSG Entertainment employees (who vested in the Company’s RSUs and PSUs), were retained by the Company and the taxes paid are reflected as financing activity in the accompanying consolidated statement of cash flows for the year ended June 30, 2023.

The fair value of RSUs and PSUs that vested during the years ended June 30, 2022 and 2021 was $ 40,490 and $ 36,099 , respectively.

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_________________

(a) Weighted-average exercise price per share does not reflect any adjustment associated with the MSGE Distribution.

See above for a discussion of the treatment of options in connection with the MSGE Distribution.

(a) Weighted-average exercise price per share does not reflect any adjustment associated with the Sphere Distribution.

See above for a discussion of the treatment of options in connection with the Sphere Distribution.

Stock Repurchase Program

On September 11, 2015, the Company’s board of directors authorized the repurchase of up to $ 525,000 of the Company’s Class A Common Stock once the shares of the Company’s Class A Common Stock began “regular way” trading on October 1, 2015.

Under the authorization, shares of Class A Common Stock may be purchased from time to time in accordance with applicable insider trading and other securities laws and regulations.

Effective as of October 1, 2015, the Company’s board of directors authorized the repurchase of up to $ 525,000 of the Company’s Class A Common Stock.

Under the authorization, shares of Class A Common Stock may be purchased from time to time in open market or private transactions, block trades, or such other matter as the Company may determine, in accordance with applicable insider trading and other securities laws and regulations.

The timing and amount of purchases will depend on market conditions and other factors.

During the year ended June 30, 2022, the Company did no t engage in any share repurchase activities under its share repurchase program.

On October 6, 2022, the Company’s Board of Directors authorized a $ 75,000 accelerated share repurchase (“ASR”) program under the Company’s existing share repurchase authorization.

On October 28, 2022, the Company entered into a $ 75,000 ASR agreement with JPMorgan Chase Bank, National Association (“JP Morgan”).

Pursuant to the ASR agreement, the Company made a payment of $ 75,000 to JP Morgan and JP Morgan delivered 388,777 initial shares of Class A Common Stock to the Company on November 1, 2022, representing 80 % of the total shares expected to be repurchased under the ASR (determined based on the closing price of the Company’s Class A Common Stock of $ 154.33 on October 28, 2022).

The ASR was completed on January 31, 2023 with JP Morgan delivering 67,681 additional shares of Class A Common Stock to the Company upon final settlement.

The average purchase price per share for shares of Class A Common Stock purchased by the Company pursuant to the ASR was $ 164.31 .

The ASR was accounted for as a repurchase of shares and as an equity forward contract indexed to the Company’s Class A Common Stock.

The equity forward contract was classified as an equity instrument under ASC Subtopic 815-40.

The Company has treated the initial and final shares of Class A Common Stock delivered as treasury shares as of the date the shares were physically delivered in computing the weighted average shares of outstanding Class A Common Stock for both basic and diluted earnings per share.

As of June 30, 2023, the Company had $ 184,639 of availability remaining under its stock repurchase authorization.

Related Party Transactions

On July 9, 2021, MSG Networks merged with a subsidiary of MSG Entertainment and became a wholly-owned subsidiary of MSG Entertainment (the “MSGE-MSGN Merger”).

Accordingly, agreements between the Company and MSG Networks are now effectively agreements with MSG Entertainment on a consolidated basis.

As of June 30, 2023, members of the Dolan family including trusts for members of the Dolan family (collectively, the “Dolan Family Group”), for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, collectively beneficially own 100 % of the Company’s outstanding Class B Common Stock and own approximately 3.2 % of the Company’s outstanding Class A Common Stock.

Such shares of the Company’s Class A Common Stock and Class B Common Stock, collectively, represent approximately 71.0 % of the aggregate voting power of the Company’s outstanding common stock.

Members of the Dolan family are also the controlling stockholders of MSG Entertainment and AMC Networks Inc.

Members of the Dolan family are also the controlling stockholders of Sphere Entertainment, MSG Entertainment and AMC Networks Inc.

(“AMC Networks”).

Members of the Dolan family were the direct controlling stockholders of MSG Networks prior to the MSGE-MSGN Merger and indirectly control MSG Networks through MSGE’s ownership of MSG Networks.

Current Related Party Arrangements

The Company is party to the following agreements and/or arrangements with MSG Entertainment (including its subsidiary MSG Networks):

• Arena License Agreements pursuant to which MSG Entertainment (i) provides the right to use The Garden for games of the Knicks and the Rangers for a 35 -year term in exchange for arena license fees, (ii) shares revenues collected for suite licenses, (iii) operates and manages the sale of the sports teams merchandise at The Garden for a commission, (iv) operates and manages the sales of food and beverage concessions in exchange for 50% of net profits from the sales and catering services during Knicks and Rangers home games, (v) provides day of game services that were historically provided prior to the MSGE Distribution, and (vi) provides other general services within The Garden;

• Media rights agreements, that the Company and MSG Networks entered into in July 2015 with stated terms of 20 years, providing MSG Networks with local telecast rights for Knicks and Rangers games in exchange for media rights fees;

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Current Related Party Arrangements

The Company is party to the following agreements and/or arrangements with MSG Entertainment as of June 30, 2023:

• Arena License Agreements, entered into in April 2020, pursuant to which MSG Entertainment (i) provides the right to use The Garden for games of the Knicks and the Rangers for a 35 -year term in exchange for arena license fees, (ii) shares revenues collected for suite licenses, (iii) operates and manages the sale of the sports teams’ merchandise at The Garden for a commission, (iv) operates and manages the sales of food and beverage concessions in exchange for 50 % of net profits from sales and catering services during Knicks and Rangers home games, (v) provides day of game services, and (vi) provides other general services within The Garden;

• Sponsorship sales and service representation agreements pursuant to which MSG Entertainment has the exclusive right and obligation to sell the Company’s sponsorships for an initial stated term of 10 years for a commission.

In addition, under this agreement, the Company is charged by MSG Entertainment for sales and service staff and overhead associated with the sales of sponsorship assets.

• Team sponsorship allocation agreement with MSG Entertainment, pursuant to which teams continue receiving an allocation of sponsorship and signage revenues associated with the sponsorship agreements that existed at the MSGE Distribution Date;

• Services Agreement (the “Services Agreement”) pursuant to which the Company (i) receives certain services from MSG Entertainment, such as information technology, accounts payable, payroll, human resources, and other corporate functions, as well as the executive support services, in exchange for service fees and (ii) provides certain services to MSGE Entertainment, such as certain communications, legal (including certain services the Company provided to MSG Networks prior to the MSGE-MSGN Merger) and ticketing services, in exchange for service fees;

As of January 1, 2023, the Company has been providing certain services that were previously provided by MSG Entertainment under the agreements on an interim basis, and MSG Entertainment fully reimburses the Company for the costs of providing such services;

• Team sponsorship allocation agreement with MSG Entertainment, pursuant to which the teams continue receiving an allocation of sponsorship and signage revenues associated with the sponsorship agreements;

• Services agreement pursuant to which the Company (i) receives certain services from MSG Entertainment, such as information technology, accounts payable, payroll, human resources, and other corporate functions, and executive support services, in exchange for service fees and (ii) provides certain services to MSG Entertainment, such as certain communications, legal, ticketing, sponsorship and premium hospitality-related services, in exchange for service fees;

• Sublease agreement, pursuant to which the Company leases office space from MSG Entertainment;

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• Single night rental commission agreement, pursuant to which the Company may, from time to time, sell (or make referrals for sales of) licenses for the use of suites at The Garden for individual MSG Entertainment events in exchange for a commission and reimbursement for sales and service staff and overhead associated with the ticket sales on behalf of MSG Entertainment;

• Aircraft sharing agreements pursuant to which MSG Entertainment has agreed from time to time to make its aircraft and an aircraft it leases from another related party available to the Company for lease on a “time sharing” basis;

• Other agreements with MSG Entertainment entered into in connection with the MSGE Distribution, including a distribution agreement, a tax disaffiliation agreement, an employee matters agreement, a trademark license agreement and certain other arrangements;

• Other agreements with MSG Networks entered into in connection with the MSGS Distribution, including a distribution agreement, a tax disaffiliation agreement, an employee matters agreement and certain other arrangements.

In addition, the Company has shared certain executive support costs, including office space, executive assistants, security and transportation costs for:

(i) the Company’s Executive Chairman with MSG Entertainment;

and (ii) the Company’s Vice Chairman with AMC Networks and MSG Entertainment.

The Company also previously shared such costs for the Company’s President and Chief Executive Officer with MSG Entertainment through March 31, 2022.

Additionally, the Company, MSG Entertainment, and AMC Networks allocate the costs of certain personal aircraft and helicopter use by their shared executives.

From time to time the Company has entered into, and is expected to continue to enter into, arrangements with 605, LLC.

Dolan, a former director of the Company and spouse of James L.

Dolan, the Company’s Executive Chairman and a director, is the founder and Chief Executive Officer of 605, LLC.

Dolan and Kristin A.

Dolan own 50 % of 605, LLC.

605, LLC provides audience measurement and data analytics services to the Company and its subsidiaries in the ordinary course of business.

Related Party Arrangements Prior to the MSGE Distribution

Following the MSGE Distribution, except as otherwise noted, the Company is no longer party to the arrangements described below.

However, the amounts associated with such arrangements are reflected in the Company’s results of operations for the periods prior to the MSGE Distribution.

The Company had various agreements with MSG Networks, including an advertising sales representation agreement and a services agreement (the “Prior MSGN Services Agreement”).

Pursuant to the Prior MSGN Services Agreement, which was effective July 1, 2019, the Company provided certain services to MSG Networks, such as information technology, accounts payable, payroll, human resources, and other corporate functions, as well as the executive support services described below, in exchange for service fees.

MSG Networks also provided certain services to the Company, in exchange for service fees.

Effective as of the MSGE Distribution, this agreement was between MSG Entertainment and MSG Networks.

The Company separately entered into the Services Agreement with MSG Networks.

See “— Current Related Party Arrangements.”

The Company shared certain executive support costs, including office space, executive assistants, security and transportation costs, for (i) the Company’s Executive Chairman with MSG Networks and (ii) the Company’s Vice Chairman with MSG

• Interest-bearing advances to MSG Entertainment in connection with the construction of new premium hospitality suites at The Garden;

• Aircraft sharing agreements pursuant to which MSG Entertainment has agreed from time to time to make its aircraft and aircraft it leases from other related parties available to the Company for lease on a “time sharing” basis;

• Other agreements with MSG Entertainment entered into in connection with the Sphere Distribution, including a trademark license agreement and certain other arrangements.

The Company is also party to the following agreements and/or arrangements with Sphere Entertainment (including through its subsidiary MSG Networks) as of June 30, 2023:

• Media rights agreements between the Company and MSG Networks, entered into in July 2015 with stated terms of 20 years, providing MSG Networks with local telecast rights for Knicks and Rangers games in exchange for media rights fees;

• Arrangements with MSG Networks pursuant to which the Knicks and the Rangers have allocated revenues with MSG Networks related to virtual advertising inventory;

• Other agreements with Sphere Entertainment in connection with the Sphere Distribution, including a distribution agreement, a tax disaffiliation agreement and an employee matters agreement and certain other arrangements;

• Other agreements with MSG Networks entered into in connection with the MSGS Distribution, including an employee matters agreement, agreements related to audio-only distribution rights for Knicks and Rangers games, and certain other arrangements.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Networks and AMC Networks.

Additionally, the Company, MSG Networks and AMC Networks agreed on an allocation of the costs of certain personal aircraft and helicopter use by their shared executives.

Following the MSGE Distribution, the Company also shares these expenses with MSG Entertainment.

See “— Current Related Party Arrangements.”

The Company was a party to various Aircraft Support Services Agreements (the “Support Agreements”), pursuant to which the Company provided certain aircraft support services to entities controlled by (i) James L.

Dolan, (ii) Charles F.

Dolan, and (iii) Patrick F.

Dolan, the son of Charles F.

Dolan and brother of James L.

On December 17, 2018, the Company terminated the agreement providing services to the entity controlled by Charles F.

Dolan, and entered into a new agreement with Charles F.

Dolan and certain of his children, who are siblings of James L.

Dolan, specifically:

Dolan (a director of the Company), Deborah Dolan-Sweeney, Patrick F.

Dolan, Marianne Dolan Weber (a director of the Company), and Kathleen M.

Dolan, which provided substantially the same services as the prior agreement for a new aircraft.

In addition, the Company was party to reciprocal time sharing/dry lease agreements with each of (i) Quart 2C, LLC (“Q2C”), a company controlled by James L.

In addition, the Company shared certain executive support costs, including office space, executive assistants, security and transportation costs for:

(i) the Company’s Executive Chairman with Sphere Entertainment and, following the MSGE Distribution, MSG Entertainment;

(ii) the Company’s Vice Chairman with AMC Networks, Sphere Entertainment and, following the MSGE Distribution, MSG Entertainment, and (iii) the Company’s Executive Vice President with Sphere Entertainment and AMC Networks.

The Company also previously shared such costs for the Company’s former Chief Executive Officer with Sphere Entertainment through March 31, 2022.

Additionally, the Company, Sphere Entertainment, AMC Networks, and, following the MSGE Distribution, MSG Entertainment allocated the costs of certain personal aircraft and helicopter usage by their shared executives.

From time to time the Company has entered into, and may in the future enter into, arrangements with 605, LLC.

Dolan, a former director of the Company and spouse of James L.

Dolan, the Company’s Executive Chairman and a director, is the founder, Non-Executive Chairman and former Chief Executive Officer of 605, LLC.

Dolan and Kristin A.

Dolan, his spouse and a former director of the Company, and (ii) Charles F.

Dolan and Sterling Aviation, LLC, a company controlled by Charles F.

Dolan (collectively, “CFD”), pursuant to which the Company had agreed from time to time to make its aircraft available to each of Q2C and CFD, and Q2C and CFD have agreed from time to time to make their aircraft available to the Company.

Pursuant to the terms of the agreements, Q2C and/or CFD could lease on a non-exclusive, “time sharing” basis, the Company’s Gulfstream Aerospace G550 aircraft (the “G550 Aircraft”).

On December 17, 2018, in connection with the purchase of a new aircraft (as noted above), the Company replaced the dry lease agreement with CFD with a new dry lease agreement with Sterling2k LLC, an entity owned and controlled by Deborah Dolan-Sweeney, the daughter of CFD and the sister of James L.

Dolan, which provided for the Company’s usage of the new aircraft on the same terms as the prior agreement.

On May 6, 2019, the Company entered into a dry lease agreement with Brighid Air, LLC (“Brighid Air”), a company owned and controlled by Patrick F.

Dolan, pursuant to which the Company was permitted to lease on a non-exclusive basis Brighid Air’s Bombardier BD100-1A10 Challenger 350 aircraft (the “Challenger”).

In connection with the dry lease agreement, on May 6, 2019, the Company also entered into a Flight Crew Services Agreement (the “Flight Crew Agreement”) with the Dolan Family Office, LLC (“DFO”), an entity owned and controlled by Charles F.

Dolan, pursuant to which the Company was permitted to utilize pilots employed by DFO for purposes of flying the Challenger when the Company was leasing that aircraft under the Company’s dry lease agreement with Brighid Air.

The Company and each of MSG Networks and AMC Networks were party to certain aircraft time sharing agreements, pursuant to which the Company agreed from time to time to make its aircraft available to MSG Networks and/or AMC Networks for lease on a “time sharing” basis.

In addition to the aircraft arrangements described above, certain executives of the Company were party to aircraft time sharing agreements, pursuant to which the Company agreed from time to time to make certain aircraft available for lease on a “time sharing” basis for personal use in exchange for payment of actual expenses of the flight (as listed in the agreement).

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Dolan own 50 % of 605, LLC.

605, LLC has provided audience measurement and data analytics services to the Company and its subsidiaries in the ordinary course of business.

Revenues and Operating Expenses (Credits)

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2023 2022 2021

Revenues $ 178,696 $ 147,029 $ 138,881

Operating expenses (credits):

Corporate general and administrative expenses, net 41,080 38,491 1,154

Costs associated with the Sponsorship sales and service representation agreements

$ 190,000 $ 178,696 $ 147,029

Costs associated with the Arena License Agreements 101,514 46,974 —

Other operating expenses (credits), net 1,288 573 ( 337 )

Revenues from related parties primarily consist of local media rights recognized from the licensing of team-related programming under the media rights agreements covering the Knicks and the Rangers, which provide MSG Networks with exclusive media rights to team games in their local markets.

Corporate general and administrative expenses, net

Corporate general and administrative expenses, net reflects net charges of $ 38,102 , $ 36,730 , and $ 8,916 from MSG Entertainment pursuant to the Services Agreement for certain business functions that were previously performed by internal resources for the years ended June 30, 2022, 2021, and 2020, respectively.

These services include information technology, accounting, accounts payable, payroll, tax, legal, human resources, insurance and risk management, investor relations, corporate communications, benefit plan administration and reporting, and internal audit.

In addition, Corporate general and administrative expenses, net reflects rent expense of $ 2,978 , $ 2,636 , and $ 593 , associated with the lease of office space from MSG Entertainment for years ended June 30, 2022, 2021, and 2020, respectively.

See Note 8 for more information regarding the lease of office space from MSG Entertainment.

Corporate general and administrative expenses, net also reflects charges of $ 875 and $ 8,474 from the Company to MSG Networks for the period prior to the MSGE-MSGN Merger pursuant to a services agreement between the Company and MSG Networks for the years ended June 30, 2021 and 2020, respectively.

Operating expenses (credits):

Expense pursuant to Services agreement with MSG Entertainment 36,458 38,102 36,730

Rent expense pursuant to Sublease agreement with MSG Entertainment 2,918 2,978 2,636

Costs associated with the Sponsorship sales and service representation agreements 19,329 22,316 16,016

Pursuant to the Sponsorship sales and service representation agreements, MSG Entertainment charges the Company sales commission fees and sponsorship fulfillment costs, as well as costs of MSG Entertainment sales and service staff and overhead associated with the sales of sponsorship assets.

Costs associated with the Arena License Agreements

For the years ended June 30, 2022 and 2021, costs associated with the Arena License Agreements include $ 67,620 and $ 36,629 , respectively, recorded as operating lease cost.

See Note 8 for more information regarding Arena License Agreements.

Operating lease expense associated with the Arena License Agreements 67,619 67,620 36,629

Other costs associated with the Arena License Agreements 36,240 33,894 10,345

Other operating expenses (credits), net 84 1,288 ( 302 )

The Company and its related parties enter into transactions with each other in the ordinary course of business.

Other operating expenses (credits), net includes net charges relating to (i) reciprocal aircraft arrangements between the Company and each of Q2C and CFD and (ii) time sharing agreements with MSG Networks and AMC Networks.

Following the MSGE Distribution, the Company no longer provides these services to MSG Networks.

However, these charges are reflected in the Company’s results of operations for the periods prior to the MSGE Distribution as they do not meet the criteria for inclusion in discontinued operations.

In addition, Other operating expenses (credits), net includes fees paid by the Company to MSG Networks for insertion of virtual signage during Knicks home and away games during the 2021-22 and 2020-21 seasons.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Discontinued operations

For the year ended June 30, 2020, related party transactions included in loss from discontinued operations, net of taxes in the accompanying consolidated statements of operations include the following (i) revenues from related parties of $ 13,106 , (ii) operating expenses charged by related parties of $ 897 , and (iii) equity in loss of equity-method investments of $ 3,739 .

Income tax expense (benefit) attributable to continuing operations is comprised of the following components:

(a) Primarily consist of local media rights recognized from the licensing of team-related programming under the media rights agreements covering the Knicks and the Rangers.

Income tax expense (benefit) attributable to operations is comprised of the following components:

Years Ended June 30,

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Income tax expense (benefit) $ 44,293 $ 25,052 $ ( 73,421 )

The income tax expense (benefit) attributable to continuing operations differs from the amount derived by applying the statutory federal rate to pre-tax income principally due to the effect of the following items:

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The income tax expense (benefit) attributable to operations differs from the amount derived by applying the statutory federal rate to pre-tax income principally due to the effect of the following items:

Years Ended June 30,

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1,788 ( 3,191 ) ( 896 )

Federal tax credits — — ( 1,480 )

Capital loss carryover ( 2,728 ) — —

GAAP income of consolidated partnership attributable to non-controlling interests

Tax effect of indefinite-lived intangible amortization — — 204

Return to provision 366 ( 2,476 ) —

7 unchanged sentences

Income tax expense (benefit) $ 44,293 $ 25,052 $ ( 73,421 )

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The tax effects of temporary differences which give rise to significant portions of the deferred tax assets and liabilities at June 30, 2023 and 2022 are as follows:

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Net operating loss carryforwards $ — $ 21,171

Tax credit carryforwards 6,547 6,547

Capital loss and tax credit carryforwards 2,728 6,547

Accrued employee benefits 20,760 21,687

10 unchanged sentences

Prepaid expenses ( 10,353 ) ( 9,746 )

Other — ( 447 )

Total deferred tax liabilities $ ( 112,923 ) $ ( 107,399 )

Net deferred tax (liability) asset $ ( 8,917 ) $ 15,943

Net deferred tax liability $ ( 24,024 ) $ ( 8,917 )

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax asset will not be realized.

The Company’s ability to realize its deferred tax assets depends upon the generation of sufficient future taxable income to allow for the utilization of its federal net operating loss carryforward (“NOL”) and its future deductible temporary differences.

As of June 30, 2022, the Company determined there is sufficient positive evidence to conclude that it is more likely than not that its deferred income tax assets are realizable.

As of June 30, 2023, based on current facts and circumstances, management believes that it is more likely than not that the Company will not realize the benefit for a portion of its deferred tax assets related to capital loss carryforwards.

The Company will continue to assess the realizability of its deferred tax assets on a quarterly basis.

The NOL as of June 30, 2022 was approximately $ 23,000 and will primarily expire in 2036 and 2038.

The Company does no t have any uncertain tax positions as of June 30, 2023 and 2022.

Prior to the MSGE Distribution, the Company and MSG Entertainment entered into a Tax Disaffiliation Agreement (“TDA”) that governs the parties’ respective rights, responsibilities and obligations with respect to taxes and tax benefits.

Prior to the Sphere Distribution, the Company and Sphere Entertainment entered into a Tax Disaffiliation Agreement (“TDA”) that governs the parties’ respective rights, responsibilities and obligations with respect to taxes and tax benefits.

Under the TDA, the Company will generally be responsible for all U.S.

federal, state, local and other applicable income taxes of MSG Entertainment for any taxable period or portion of such period ending on or before the MSGE Distribution Date.

The Company was notified in April 2020 and in February 2022 that the City of New York was commencing an audit of the local income tax returns for the fiscal years ended June 30, 2016 and 2017 and for fiscal years ended June 30, 2018 and 2019, respectively.

federal, state, local and other applicable income taxes of Sphere Entertainment for any taxable period or portion of such period ending on or before the Sphere Distribution Date.

The Company was notified in April 2020 that the City of New York was commencing an audit of the local income tax returns for the fiscal years ended June 30, 2016 and 2017.

The Company does not expect the examinations, when finalized, to result in material changes.

The federal and state statute of limitations are currently open for tax returns for years starting with 2020 and 2016, respectively

During the year ended June 30, 2023, the Company made income tax payments of $ 18,615 .

Concentrations of Risk

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The Company’s emphasis is primarily on safety of principal and liquidity and secondarily on maximizing the yield on its investments.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following individual non-related parties accounted for the following percentages of the Company’s consolidated receivable balances recorded in Accounts receivable, net and Other assets in the accompanying consolidated balance sheets:

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Entity B 52 % 35 %

Entity C — % 16 %

The following individual non-related parties accounted for the following percentages of the Company’s consolidated revenue balances:

7 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures