Twenty-First Century Fox 2011 Annual Report Download - page 68

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Notes to the Consolidated Financial Statements (continued)
At June 30, 2011, 1,687,500 of the SARs were vested and exercisable. No SARs have been issued since fiscal 2005.
The following table summarizes information about the Company’s stock option transactions (options in thousands):
Tranches
Options
Outstanding
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Life
Exercisable
Options
Weighted
Average
Exercise
Price
(in US$) (in US$) (in US$)
$3.24 to $3.93 3 $ 3.78 1.17 3 $ 3.78
$6.83 to $8.94 11,796 8.73 1.19 10,970 8.82
$10.40 to $15.58 19,541 13.16 1.38 19,394 13.15
$16.91 to $23.25 1,247 18.94 1.08 1,219 18.98
32,587 $11.78 31,586 $11.87
The following table summarizes the Company’s equity-based compensation:
2011 2010 2009
For the years ended June 30, (in millions)
Equity-based compensation $175 $149 $156
Cash received from exercise of equity-based compensation $ 12 $ 24 $ 2
Total intrinsic value of stock options exercised $2 $1 $—
At June 30, 2011, the Company’s total compensation cost related to non-vested stock options, RSUs and PSUs not yet recognized for all plans
presented was approximately $183 million, the majority of which is expected to be recognized over the next two fiscal years. Compensation
expense on all equity-based awards is recognized on a straight-line basis over the vesting period of the entire award.
The Company recognized a tax expense on vested RSUs and stock options exercised of $1 million, $10 million and $7 million for the fiscal
years ended June 30, 2011, 2010 and 2009, respectively.
NDS Option Schemes
In February 2009, the Company, the Permira Newcos and NDS completed the NDS Transaction, resulting in the Permira Newcos and the
Company owning approximately 51% and 49% of NDS, respectively. As a result of the completion of the NDS Transaction, NDS ceased to be a
public company and the Company’s remaining interest in NDS is accounted for under the equity method of accounting. (See Note 3 – Acquisitions,
Disposals and Other Transactions) Prior to the completion of the NDS Transaction, NDS had three executive share option schemes (“the NDS
Plans”). The NDS Plans provided for the grant of options to purchase Series A ordinary shares in NDS and RSU awards that entitled the holder to
NDS Series A ordinary shares as the awards vested. In connection with the NDS Transaction, all nonvested equity awards vested and the NDS
Plans were terminated.
The Company included approximately $44 million of equity-based compensation expense related to NDS awards in its consolidated
statements of operations for the fiscal year ended June 30, 2009. The Company also recognized approximately $70 million in cash received from
exercise of equity-based compensation during the fiscal years ended June 30, 2009. During the fiscal years ended June 30, 2009 the fair value of
NDS stock options exercised was $73 million.
NOTE 15. Related Parties
Director transactions
The Company had engaged, prior to May 2010, Mrs. Wendi Murdoch, the wife of Mr. K.R. Murdoch, the Company’s Chairman and Chief
Executive Officer, to provide strategic advice for the development of the Myspace business in China. No amounts were paid to Mrs. Murdoch in
the fiscal year ended June 30, 2011. The fees paid to Mrs. Murdoch pursuant to this arrangement were $92,000, and $100,000 in fiscal 2010 and
2009, respectively. Mrs. Murdoch is a Director of Myspace China Holdings Limited (“Myspace China”), a joint venture in which the Company
owns a 51.5% interest on a fully diluted basis, which licenses the technology and brand to the local company in China that operates the Myspace
China website. Similar to other Directors of Myspace China, Mrs. Murdoch received options over 2.5% of the fully diluted shares of Myspace
China that will vest over four years under the Myspace China option plan.
Freud Communications, which is controlled by Matthew Freud, Mr. K.R. Murdoch’s son-in-law, provided external support to the press and
publicity activities of the Company during fiscal years 2011, 2010 and 2009. The fees paid by the Company to Freud Communications were
approximately $202,000, $350,000 and $473,000 in fiscal years ended June 30, 2011, 2010 and 2009, respectively. At June 30, 2011, there were
no outstanding amounts due to or from Freud Communications.
66 News Corporation