Exhibit 10.1
STOCKHOLDER AGREEMENT
BETWEEN
WARNER MUSIC GROUP CORP.
AND
ACCESS INDUSTRIES, LLC
DATED AS OF MAY 29, 2020

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ARTICLE I
DEFINITIONS
1.1
Definitions.
1
1.2
Timing of Provisions.
4

ARTICLE II
CORPORATE GOVERNANCE
2.1
Board of Directors.
5
2.2
Committees of the Board of Directors.
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ARTICLE III
INFORMATION RIGHTS AND ACCESS TO INFORMATION
3.1
Financial Information.
7
3.2
Access to Information.
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ARTICLE IV
ACCESS APPROVAL AND CONSENT RIGHTS AND OTHER RIGHTS
4.1
Access Approval and Consent Rights.
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4.2
Expenses.
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4.3
Margin Loans and Other Pledges
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ARTICLE V
GENERAL PROVISIONS
5.1
Certificate of Incorporation and Bylaws.
11
5.2
Notices.
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5.3
Specific Performance; Remedies.
12
5.4
Jurisdiction; Waiver of Jury Trial.
12
5.5
Governing Law.
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5.6
Severability.
13
5.7
Amendment, Modification and Waiver.
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5.8
Assignment.
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5.9
Further Assurances.
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5.10
Third-Party Beneficiaries.
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5.11
Discretion of Parties.
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5.12
Entire Agreement.
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5.13
Term.
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5.14
Titles and Subtitles.
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5.15
No Recourse.
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5.16
Counterparts.
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STOCKHOLDER AGREEMENT
This Stockholder Agreement, dated as of May 29, 2020, is between Warner Music
Group Corp., a Delaware corporation (the “Company”), and Access Industries, LLC,
a Delaware limited liability company (“Access”) (each a “Party” and,
collectively, the “Parties”).
RECITALS:
WHEREAS, the Access Affiliated Group is collectively the beneficial owner (as
defined herein) of all of the issued and outstanding Common Stock (as defined
herein) of the Company immediately prior to the date hereof;
WHEREAS, following Completion of the IPO (as defined herein), the Access
Affiliated Group will collectively continue to beneficially own a majority of
the total combined voting power of the Common Stock; and
WHEREAS, the Parties wish to set forth certain agreements that will govern
certain matters between them following the Completion of the IPO;
NOW, THEREFORE, in consideration of the mutual promises and covenants set forth
herein, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the Parties, intending to be legally bound,
hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 Definitions.
In this Agreement, the following terms shall have the following meanings:
“Access” has the meaning set forth in the preamble to this Agreement.
“Access Affiliated Group” means Access, Len Blavatnik, the Blavatnik Family
Foundation LLC, any direct or indirect equityholder of Access, any family member
of any direct or indirect equityholder of Access, entities controlled, directly
or indirectly, or managed, directly or indirectly, by Access or an Affiliate of
Access, and any Affiliate or Permitted Transferee of any of the foregoing,
including any Affiliate of any Permitted Transferee.
“Access Designee” shall have the definition set forth in Section 2.1(a).
“Access-Designated Director” means each Access Designee who is thereafter
elected or appointed to the Board of Directors. Any Access-Designated Director
may, at the discretion of Access, be an Independent Director.
“Affiliate” means, with respect to any Person, (i) any Person directly or
indirectly controlling, controlled by or under common control with such Person,
(ii) any Person directly or indirectly owning or controlling 10% or more of any
class of outstanding voting securities of such Person or (iii) any officer,
director, general partner or trustee of any such Person described in clause (i)
or (ii).
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“Agreement” and “hereof” and “herein” means this Stockholder Agreement,
including all amendments, modifications and supplements and all annexes and
schedules to any of the foregoing, and shall refer to this Stockholder Agreement
as the same may be in effect at the time such reference becomes operative.
“Applicable Law” means any domestic or foreign statute, law (including the
common law), ordinance, rule, regulation, published regulatory policy or
guideline, order, judgment, injunction, decree, award or writ of any court,
tribunal or other regulatory authority, arbitrator, governmental authority, or
other Person having jurisdiction, or any consent, exemption, approval or license
of any governmental authority that applies in whole or in part to a Party and,
with respect to the Company, includes the Exchange Act, the Securities Act, the
DGCL, the rules of the SEC and the rules of the Exchange and any other exchange
or quotation system on which the securities of the Company are listed or traded
from time to time.
“Bankruptcy Laws” means Title 11 of the United States Code, as amended, and
other Federal, State or foreign laws principally dealing with the liquidation,
reorganization, administration, conservatorship or receivership of insolvent
debtors.
“beneficial owner” or “beneficially own” has the meaning given such term in Rule
13d-3 under the Exchange Act and a Person’s beneficial ownership of Common Stock
or other voting securities of the Company shall be calculated in accordance with
the provisions of such Rule.
“Board of Directors” means the board of directors of the Company.
“Capital Stock” means any and all shares or units of, rights to purchase,
warrants or options for, or other equivalents of or interests in (however
designated) the equity capital of a Person or a security convertible into or
exchangeable for (whether or not such conversion or exchange is contingent or
conditional) the equity capital of a Person.
“Cause” means (i) any willful or intentional act or omission having the effect
of injuring the reputation, business or business or employment relationships of
the Company or its Affiliates; (ii) any conviction of, or plea of nolo
contendere to, a misdemeanor involving moral turpitude or a felony; (iii) with
respect to any officer or employee, any breach of covenants contained in such
officer’s or employee’s employment agreement with the Company; or (iv) with
respect to any officer or employee, repeated or continuous failure, neglect or
refusal to perform such officer’s or employee’s duties set forth under his or
her employment agreement with the Company.
“CEO” means the Chief Executive Officer of the Company from time to time (or the
equivalent successor position), as appointed by the Board of Directors.
“CFO” means the Chief Financial Officer of the Company from time to time (or the
equivalent successor position), as appointed by the Board of Directors.
“control” (including the terms “controlling,” “controlled by” and “under common
control with”), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly, of the power to direct or
cause the direction of the affairs or
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management of a Person, whether through the ownership of voting securities, as
trustee or executor, by contract or otherwise.
“Class A Common Stock” means the Class A common stock, par value $0.001 per
share, of the Company.
“Class B Common Stock” means the Class B common stock, par value $0.001 per
share, of the Company.
“Common Stock” means the Class A Common Stock and the Class B Common Stock,
collectively.
“Company” has the meaning set forth in the preamble to this Agreement.
“Completion of the IPO” means the occurrence of the settlement of the first sale
of Class A Common Stock pursuant to the IPO Registration Statement.
“DGCL” means the General Corporation Law of the State of Delaware, as amended
from time to time.
“Director” means a member of the Board of Directors and “Directors” has a
correlative meaning.
“Equity Awards” means a grant to a Director, employee or financial professional
of the Company or one of its Subsidiaries of vested or unvested shares of Common
Stock or restricted Common Stock, options to acquire shares of Common Stock,
restricted stock units, “phantom” stock units or similar interests in the
Company’s common equity, in each case pursuant to an equity compensation plan
approved by the Board of Directors.
“Exchange” means the principal exchange on which the Common Stock is listed.
“Exchange Act” means the United States Securities Exchange Act of 1934, as
amended.
“GAAP” means generally accepted accounting principles in the United States, as
in effect from time to time.
“General Counsel” means the General Counsel of the Company from time to time (or
the equivalent successor position).
“Independent Director” means a Director who is both (i) “independent” for
Exchange purposes and (ii) “independent” for purposes of Rule 10A-3(b)(1) under
the Exchange Act.
“IPO Registration Statement” means the Registration Statement on Form S-1, as
amended, relating to the initial public offering of the Class A Common Stock.
“Party” and “Parties” have the respective meanings set forth in the preamble to
this Agreement.
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“Permitted Transferee” means (i) any member of the Access Affiliated Group, (ii)
any family member of any direct or indirect equityholder of Access, (iii) any
trust formed solely for the benefit of any direct or indirect equityholder of
Access or such equityholder’s family members, (iv) any partnership, corporation
or other entity controlled by any direct or indirect equityholder of Access or
such equityholder’s family members for tax or estate planning purposes and (v)
any foundation or charity affiliated with Access or any Permitted Transferee, so
long as any direct or indirect equityholder of Access or a Permitted Transferee,
or a fiduciary who is selected by Access or such equityholder or Permitted
Transferee and whom Access or such equityholder or Permitted Transferee has the
power to remove and replace, retains voting control over the shares transferred
to such foundation or charity.
“Person” means any individual, corporation, partnership, joint venture, limited
liability company, association or other business entity and any trust,
unincorporated organization or government or any agency or political subdivision
thereof.
“Qualified Compensation Director” means a Director who is a “Non-Employee
Director” as defined in Rule 16b-3(b)(3)(i) under the Exchange Act.
“SEC” means the United States Securities and Exchange Commission.
“Securities Act” means the United States Securities Act of 1933, as amended.
“Subsidiary” of a Party shall mean any corporation, partnership, joint venture,
limited liability company, association or other entity of which such Party has
the ownership, directly or indirectly, of more than 50% of the voting securities
or similar ownership interests, including any securities or similar ownership
interests which are voting only upon the occurrence of a contingency where such
contingency has occurred and is continuing. For purposes of this Agreement,
(i) no investment fund, investment company, collective investment trust or
similar vehicle sponsored, formed or seeded by the Company or any of its
Subsidiaries shall be deemed to be a Subsidiary of the Company and (ii) the
Company and its Subsidiaries shall not be deemed to be Subsidiaries of Access.
“Trigger Date” means the date on which the Access Affiliated Group first ceases
to beneficially own at least 50% of the total combined voting power of the
then-outstanding Common Stock.
“Wholly Owned Subsidiary” means a Subsidiary, 100% of the Capital Stock of which
is owned, directly or indirectly, by a Party.
1.2 Timing of Provisions.
In this Agreement, any provision which applies “until” a specified date shall
apply on such specified date, and shall cease to apply on the date immediately
following such specified date.
ARTICLE II
CORPORATE GOVERNANCE
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2.1 Board of Directors.
(a)As of the Completion of the IPO, the Board of Directors shall consist of 11
members, and Access shall have the right, but not the obligation, to designate
for nomination by the Board of Directors, or the Nominating and Corporate
Governance Committee thereof, a number of designees (each of which shall be
designated an “Access Designee”) equal to:
(i)all Directors comprising the Board of Directors (including such number of
Independent Directors necessary to satisfy the independence requirements under
applicable securities laws and the rules of the Exchange and other regulatory
requirements) until the Trigger Date;
(ii)at least 40% of the total number of Directors comprising the Board of
Directors at such time as long as the Access Affiliated Group beneficially owns
at least 40% but less than 50% of the total combined voting power of the
then-outstanding Common Stock;
(iii)at least 30% of the total number of Directors comprising the Board of
Directors at such time as long as the Access Affiliated Group beneficially owns
at least 30% but less than 40% of the total combined voting power of the
then-outstanding Common Stock;
(iv)at least 20% of the total number of Directors comprising the Board of
Directors at such time as long as the Access Affiliated Group beneficially owns
at least 20% but less than 30% of the total combined voting power of the
then-outstanding Common Stock; and
(v)at least 10% of the total number of Directors comprising the Board of
Directors at such time as long as the Access Affiliated Group beneficially owns
at least 10% but less than 20% of the total combined voting power of the
then-outstanding Common Stock.
(b)For purposes of calculating the number of Access Designees that Access is
entitled to designate for nomination pursuant to Section 2.1(a), any fractional
amounts shall be rounded up to the nearest whole number and the calculation
shall be made on a pro forma basis after taking into account any increase in the
size of the Board of Directors.
(c)With respect to any vacancy of an Access-Designated Director, Access shall
have the right to designate a new director for appointment by a majority of the
remaining Directors then on the Board of Directors.
(d)Following the Trigger Date, Access may specify, in its sole discretion, by
notice to the Company (which notice may be oral or in writing) which Directors
are Access-Designated Directors.
(e)Until such time as the Access Affiliated Group first ceases to beneficially
own at least 35% of the total combined voting power of the then-outstanding
Common Stock, the
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Company shall, and shall use its best efforts to cause the Board of Directors
to, cause the Chairman of the Board of Directors to be an Access-Designated
Director.
(f)Until such time as the Access Affiliated Group first ceases to beneficially
own at least 10% of the total combined voting power of the then-outstanding
Common Stock, the Company shall, and shall use its best efforts to cause the
Board of Directors or the Nominating and Corporate Governance Committee thereof
to, do each of the following:
(i)include the Access Designees in the slate of nominees recommended by the
Board of Directors or the Nominating and Corporate Governance Committee thereof,
and to use its best efforts to cause the election or appointment of each such
Access Designee to the Board of Directors, including nominating such individuals
to be elected or appointed as Access-Designated Directors as provided herein;
(ii)cause there to be on the Board of Directors at all times that number of
Access-Designated Directors for which Access maintains designation rights
pursuant to Section 2.1(a);
(iii)fill any vacancy on the Board of Directors created by the resignation,
removal or incapacity of any Access-Designated Director with another
Access-Designated Director candidate identified by Access, to the extent Access
would at such time have designation rights for such Access-Designated Director
candidate pursuant to Section 2.1(a);
(iv)not permit the removal of any Access-Designated Director without Access’s
consent, to the extent Access would at such time have designation rights for
such Access-Designated Director pursuant to Section 2.1(a); and
(v)take all actions necessary to effectuate the matters set forth in Section 2.2
below.
2.2 Committees of the Board of Directors.
As of the Completion of the IPO, the Board of Directors shall have established
an audit committee, compensation committee, nominating and corporate governance
committee, finance committee and executive committee.
Until the Trigger Date, Access shall have the right to designate
Access-Designated Directors for appointment to each of the foregoing committees,
as well as any subsequently established committee(s); provided that the
composition of any such committee shall comply with applicable law, rule or
regulation, including those related to director independence. Following the
Trigger Date, Access shall be entitled to representation on each such committee
equal to the number of Access-Designated Director(s) that is as close as
possible to Access’s proportional voting power in the Company (with any
fractional amounts to be rounded up to the nearest whole number); provided that
there shall not at any time be fewer than one Access-Designated Director on each
such committee.
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ARTICLE III
INFORMATION RIGHTS AND ACCESS TO INFORMATION
3.1 Financial Information.
Upon written request of Access, the Company shall deliver, or cause to be
delivered, to Access, the following information for so long as the Access
Affiliated Group holds at least 10% of the total combined voting power of the
then-outstanding Common Stock:
(a)Annual Reports. As soon as available after the end of each fiscal year of the
Company, and in any event within ninety (90) days thereafter, an audited
consolidated balance sheet of the Company and its Subsidiaries as of the end of
such fiscal year, and the related consolidated statements of operations,
(deficit) equity, comprehensive income (loss) and cash flows of the Company and
its Subsidiaries for such year, together with all related notes and schedules
thereto, prepared in accordance with GAAP consistently applied and setting forth
in each case in comparative form the figures for the previous fiscal year, all
in reasonable detail and accompanied by the reports thereon of the Company’s
independent auditors.
(b)Quarterly Reports. As soon as available after the end of the first, second
and third quarterly accounting periods in each fiscal year of the Company, and
in any event within forty-five (45) days thereafter, an unaudited consolidated
balance sheet of the Company and its Subsidiaries as of the end of each such
quarterly period, and the related consolidated statements of operations,
(deficit) equity, comprehensive income (loss) and cash flows of the Company and
its Subsidiaries for such quarterly period and for the current fiscal year to
date, together with all related notes and schedules thereto, prepared in
accordance with GAAP consistently applied (subject to normal year-end audit
adjustments and the absence of notes thereto) and setting forth in comparative
form the figures for the corresponding periods of the previous fiscal year.
(c)Monthly Reports. As soon as available after the end of each month, and in any
event within forty-five (45) days thereafter, an unaudited consolidated balance
sheet of the Company and its Subsidiaries as of the end of each such monthly
period, and the related consolidated statements of operations, (deficit) equity,
comprehensive income (loss) and cash flows of the Company and its Subsidiaries
for such monthly period and for the current fiscal year to date, prepared in
accordance with GAAP consistently applied (subject to normal year-end audit
adjustments and the absence of notes thereto). Unless Access requests in writing
that the monthly reports described above be specifically provided, the Company
shall be deemed to have satisfied the information delivery requirement in this
Section 3.1(c) by providing monthly metrics prepared for the Board of Directors
in form and substance substantially consistent with those prepared as of the
date of this Agreement by the date described in the first sentence hereof.
(d)Budget, Business Plan and Financial Forecast. An annual budget, a business
plan and financial forecasts for the Company for each fiscal year of the Company
(the “Annual Budget”), no later than sixty (60) days after the end of the
Company’s immediately preceding fiscal year, in such manner and form as approved
by the Board of Directors, which shall include at least a projection of income
and a projected cash flow statement for each fiscal quarter in such fiscal year
and a projected balance sheet as of the end of each fiscal quarter in such
fiscal year, in each case prepared in reasonable detail, with appropriate
presentation and discussion of the
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principal assumptions upon which such budgets and projections are based, which
shall be accompanied by the statement of the CEO or CFO or equivalent officer of
the Company to the effect that such budget and projections are based on
reasonable and good faith estimates and assumptions made by the management of
the Company for the respective periods covered thereby; it being recognized by
such holders that such budgets and projections as to future events are not to be
viewed as facts and that actual results during the period or periods covered by
them may differ from the projected results. Any material changes in such Annual
Budget shall be delivered to Access as promptly as practicable after such
changes have been approved by the Board of Directors.
(e)Other Requested Information. With reasonable promptness, such other
information and data (including such information and reports made available to
any lender of the Company or any of its Subsidiaries under any credit agreement
or otherwise) with respect to the Company and each of its Subsidiaries as may be
necessary for such Person to comply with its respective reporting, regulatory,
or other legal requirements and as may from time to time be reasonably requested
by any such Person.
Notwithstanding anything to the contrary in this Section 3.1, the Company may
satisfy its obligations hereunder by providing the specified reports, financial
statements or other information, as applicable, to the SEC on EDGAR or otherwise
making them publicly available.
3.1 Access to Information.
The Company shall, and shall cause its Subsidiaries, officers, Directors,
employees, auditors and other agents to, afford to Access, until such time as
the Access Affiliated Group first ceases to beneficially own at least 5% of the
total combined voting power of the then-outstanding Common Stock, (i) during
normal business hours and upon reasonable notice, reasonable access at all
reasonable times to its officers, employees, auditors, legal counsel,
properties, offices and other facilities and to all books and records, and (ii)
the opportunity to discuss the affairs, finances and accounts of the Company and
its Subsidiaries with their respective officers from time to time as Access may
reasonably request upon reasonable notice.
ARTICLE IV
ACCESS APPROVAL AND CONSENT RIGHTS AND OTHER RIGHTS
4.1 Access Approval and Consent Rights.
(a)Until such time as the Access Affiliated Group first ceases to beneficially
own at least 10% of the then-outstanding Common Stock, the Company shall not
take any of the following actions, whether directly or indirectly through a
Subsidiary, or through one or a series of related transactions, without the
prior written consent of Access:
(i)any merger, consolidation or similar transaction (or any amendment to or
termination of an agreement to enter into such a transaction) with or into any
other Person whether in a single transaction or a series of related
transactions, except any acquisition or disposition (whether through merger,
consolidation or otherwise) involving consideration less than $25 million;
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(ii)any acquisition or disposition of securities, assets or liabilities
involving consideration or book value greater than $25 million;
(iii)any change in the authorized Capital Stock of the Company or the creation
of any new class or series of Capital Stock of the Company;
(iv)any issuance or acquisition of Capital Stock (including stock buy-backs,
redemptions or other reductions of capital), or securities convertible into or
exchangeable or exercisable for Capital Stock or equity-linked securities, of
the Company or any of its Subsidiaries, except:
(A)issuances of Equity Awards to Directors or employees pursuant to an equity
compensation plan approved by the Board of Directors;
(B)issuances or acquisitions of Capital Stock of a Subsidiary of the Company to
or by a Wholly Owned Subsidiary of the Company; and
(C)issuances or acquisitions of Capital Stock that the Board of Directors
determines are necessary to maintain compliance with covenants contained in any
debt instrument;
(v)any issuance or acquisition (including redemptions, prepayments, open market
or negotiated repurchases or other transactions reducing the outstanding debt of
the Company or any Subsidiary) of any debt security to or from a third party, in
each case involving an aggregate principal amount exceeding $25 million;
(vi)any other incurrence of a debt obligation of the Company or any Subsidiary
to or from a third party having a principal amount greater than $25 million;
(vii)entry into or termination of any joint venture or similar business alliance
involving assets having a value exceeding $25 million;
(viii)listing or delisting of any securities of the Company or any of its
Subsidiaries on a securities exchange, other than the listing or delisting of
debt securities on the Exchange or any other securities exchange located solely
in the United States;
(ix)(A) any action to increase or decrease the size of the Board of Directors,
(B) the formation of, or delegation of authority to, any new committee, or
subcommittee thereof, of the Board of Directors, (C) the delegation of authority
to any existing committee or subcommittee thereof not set forth in the
committee’s charter or authorized by the Board of Directors prior to the
Completion of the IPO or (D) any amendments to the charter (or equivalent
authorizing document) of any committee, including any action
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to increase or decrease size of any committee (whether by amendment or
otherwise), except in each case as required by Applicable Law;
(x)any amendment (or approval or recommendation of any amendment) to the
Company’s certificate of incorporation or bylaws;
(xi)with respect to the Company or any Subsidiary, any filing or the making of
any petition under Bankruptcy Laws, any general assignment for the benefit of
creditors, any admission of an inability to meet obligations generally as they
become due or any other act the consequence of which is to subject the Company
or any Subsidiary to a proceeding under Bankruptcy Laws;
(xii)any dissolution or winding-up of the Company;
(xiii)the election, appointment, hiring, dismissal or removal of the Company’s
CEO, CFO or General Counsel;
(xiv)any material change in a significant accounting policy of the Company and
any termination or change of the Company’s independent auditor;
(xv)settlement of any litigation to which the Company or any of its subsidiaries
is a party involving the payment by the Company or any of its subsidiaries of an
amount equal to or greater than $15 million; or
(xvi)the creation or amendment of any stock option, employee stock purchase or
similar equity-based plan for management or employees, or any increase in the
number of shares of Common Stock reserved under such plan.
(b)With respect to any action for which Access has consent or approval rights
under Article IV, the Company shall provide Access with a written notice
describing the intended action and requesting Access’s prior written consent or
approval. The consent or approval of Access shall be evidenced in writing signed
by a duly authorized officer of Access and shall be provided to the Company no
later than five business days following receipt of the Company’s notice.
Notwithstanding the foregoing, Access may waive the foregoing notice requirement
by approval of a majority of the Access-Designated Directors. In addition,
notwithstanding the foregoing, until such time as the Access-Designated
Directors no longer comprise a majority of the Directors on the Board of
Directors or, in the case of any action requiring the consent of a committee of
the Board of Directors, such committee, the approval of the Board of Directors
or such committee shall be deemed a waiver of the Company’s notice requirement
and constitute the consent or approval of Access so long as the
Access-Designated Director(s) on the Board of Directors or such committee who
are also Access employees so approve.
4.2 Expenses.
Until such time as the Access Affiliated Group first ceases to beneficially own
at least 35% of the total combined voting power of the then-outstanding Common
Stock, the Company
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shall, or shall cause one or more of its Subsidiaries to, pay directly, or
reimburse Access for, its reasonable Out-of-Pocket Expenses (as defined below).
For purposes of this Agreement, “Out-of-Pocket Expenses” shall mean the amounts
actually paid by Access in cash in connection with the performance of any
Services (as defined below) by Access on behalf of the Company or any of its
Subsidiaries, including, without limitation, (i) fees and disbursements
(including underwriting fees) of any independent auditors, outside legal
counsel, consultants, investment bankers, financial advisors and other
independent professionals or organizations, (ii) costs of any outside services
or independent contractors such as financial printers, couriers, business
publications or similar services, (iii) transportation, and (iv) telephone
calls, word processing expenses or any similar expense not associated with
Access’s ordinary operations. All reimbursements for Out-of-Pocket Expenses
shall be made promptly upon or as soon as practicable after presentation by
Access to the Company of the statement in connection therewith. For purposes of
this Agreement, “Services” shall mean (i) professional, advisory, consulting and
oversight services relating to strategic planning, marketing and financial
oversight of the operations of the Company and its Subsidiaries and any
personnel matters, including in connection with the selection, retention and
supervision of independent auditors, outside legal counsel, investment bankers
or other advisors or consultants of the Company and its Subsidiaries and (ii)
financial, advisory, investment banking or other services with respect to
proposed transactions, including acquisitions or divestitures and public or
private sales of debt or equity securities, which directly or indirectly involve
the Company or its Subsidiaries.
4.3 Margin Loans and Other Pledges
Notwithstanding any other policy of the Company, including the Insider Trading
Policy, any member of the Access Affiliated Group may enter into or borrow
against any margin loan facility, borrow against any account that holds Common
Stock or otherwise pledge or hypothecate its Common Stock as collateral for a
loan at any time.
ARTICLE V
GENERAL PROVISIONS
5.1 Certificate of Incorporation and Bylaws.
The rights and obligations of Access with respect to the Company shall be
determined pursuant to the DGCL, the Company’s certificate of incorporation, the
Company’s bylaws and this Agreement. To the extent that the rights or
obligations of Access are different by reason of any provision of this Agreement
than they would be in the absence of such provision, this Agreement, to the
extent permitted by the DGCL, shall control.
5.2 Notices.
Unless otherwise specified herein, all notices required or permitted to be given
under this Agreement shall be in writing, shall refer specifically to this
Agreement and shall be delivered personally, sent by a nationally recognized
overnight courier service or sent by in the form of an electronic transmission
(receipt confirmation requested), and shall be deemed to be effective upon
delivery. All such notices shall be addressed to the receiving Party at such
Party’s address
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or email address set forth below, or at such other address or email address as
the receiving Party may from time to time furnish by notice as set forth in this
Section 5.2:
If to the Company, to:
Warner Music Group Corp.
1633 Broadway, 7th Floor
New York, NY 10019
Attention: Paul Robinson, General Counsel
Telephone: (212) 275-2045
Email: Paul.Robinson@wmg.com
If to Access, to:
Access Industries, LLC
70 Fifth Avenue
New York, NY 10019
Attention: Alejandro Moreno
Telephone: (212) 247-6400
Email: amoreno@accind.com
5.3 Specific Performance; Remedies.
In the event of any actual or threatened default in, or breach of, any of the
terms, conditions and provisions of this Agreement, the affected Party shall
have the right to specific performance and injunctive or other equitable relief
of its rights under this Agreement, in addition to any and all other rights and
remedies at law or in equity, and all such rights and remedies shall be
cumulative. The other Party shall not oppose the granting of such relief. The
Parties agree that the remedies at law for any breach or threatened breach
hereof, including monetary damages, are inadequate compensation for any loss and
that any defense in any action for specific performance that a remedy at law
would be adequate is waived. Any requirements for the securing or posting of any
bond with such remedy are hereby waived.
5.4 Jurisdiction; Waiver of Jury Trial.
In any judicial proceeding involving any dispute, controversy or claim arising
out of or relating to this Agreement, each of the Parties unconditionally
accepts the jurisdiction and venue of the Court of Chancery of the State of
Delaware or, if the Court of Chancery does not have subject matter jurisdiction
over this matter, the Superior Court of the State of Delaware (Complex
Commercial Division) or, if jurisdiction over the matter is vested exclusively
in federal courts, the United States District Court for the District of
Delaware, and the appellate courts to which orders and judgments thereof may be
appealed. In any such judicial proceeding, the Parties agree that in addition to
any method for the service of process permitted or required by such courts, to
the fullest extent permitted by law, service of process may be made by delivery
provided pursuant to the directions in Section 5.2. EACH OF THE PARTIES HEREBY
WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING INVOLVING ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF
OR RELATING TO THIS AGREEMENT.
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5.5 Governing Law.
This Agreement shall be governed by, and interpreted in accordance with, the
laws of the State of Delaware applicable to contracts made and to be performed
entirely within such State, without regard to the conflicts of law principles
thereof to the extent that such principles would apply the law of another
jurisdiction.
5.6 Severability.
In the event that any provision of this Agreement is declared invalid, void or
unenforceable, the remainder of this Agreement shall remain in full force and
effect, and such invalid, void or unenforceable provision shall be interpreted
in a manner that accomplishes, to the extent possible, the original purpose of
such provision.
5.7 Amendment, Modification and Waiver.
This Agreement may be amended, modified or supplemented at any time by written
agreement of the Parties. Any failure of any Party to comply with any term or
provision of this Agreement may be waived by the other Party, by an instrument
in writing signed by such Party, but such waiver or failure to insist upon
strict compliance with such term or provision shall not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure to comply.
5.8 Assignment.
This Agreement shall be binding upon and inure to the benefit of the Parties and
their respective permitted successors and assigns. Except for any assignment or
transfer by Access to a Permitted Transferee, neither Party shall assign any of
its rights or delegate any of its obligations under this Agreement without the
prior written consent of the other Party. Any purported assignment in violation
of this Section shall be null and void ab initio.
5.9 Further Assurances.
In addition to the actions specifically provided for elsewhere in this
Agreement, each Party shall execute and deliver such additional documents,
instruments, conveyances and assurances, take, or cause to be taken, all actions
and do, or cause to be done, all things reasonably necessary, proper or
advisable to carry out the provisions of this Agreement. To the fullest extent
permitted by law, the Company shall not directly or indirectly take any action
that is intended to, or would reasonably be expected to result in, Access being
deprived of the rights contemplated by this Agreement.
5.10 Third-Party Beneficiaries.
Except as expressly set forth elsewhere in this Agreement, nothing in this
Agreement, express or implied, is intended to confer upon any Person, other than
the Parties and their respective successors and assigns, any rights or remedies
under or by reason of this Agreement. Only the Parties that are signatories to
this Agreement (and their respective permitted successors and assigns) shall
have any obligation or liability under, in connection with, arising out of,
resulting from or in any way related to this Agreement or any other matter
contemplated hereby,
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or the process leading up to the execution and delivery of this Agreement and
the transactions contemplated hereby, subject to the provisions of this
Agreement.
5.11 Discretion of Parties.
Where this Agreement requires or permits any Party to make or take any decision,
determination or action with respect to matters governed by this Agreement,
unless expressly provided otherwise, such decision, determination or action may
be made or taken by such Party in its sole and absolute discretion.
5.12 Entire Agreement.
This Agreement embodies the entire agreement and understanding of the Parties in
respect of the subject matter covered by this Agreement. There are no
restrictions, promises, representations, warranties, covenants or undertakings,
other than those expressly set forth or referred to herein. This Agreement
supersedes all prior oral and written agreements and understandings between the
Parties with respect to such subject matter.
5.13 Term.
Except to the extent set forth in the following sentence, this Agreement shall
terminate and be of no further force or effect as of the date that is one year
following the date when the Access Affiliated Group first ceases to beneficially
own at least 5% of the total combined voting power of the then-outstanding
Common Stock. Notwithstanding the foregoing sentence, the provisions of Article
I and Article V hereof shall survive termination of this Agreement.
5.14 Titles and Subtitles.
The titles of the articles, sections and subsections of this Agreement are for
convenience of reference only and shall not affect the meaning or interpretation
of this Agreement.
5.15 No Recourse.
This Agreement may only be enforced against, and any claims or cause of action
that may be based upon, arise out of or relate to this Agreement or the
negotiation, execution or performance of this Agreement may only be made
against, the entities that are expressly identified as Parties and no past,
present or future Affiliate, Director, officer, employee, incorporator, member,
manager, partner, stockholder, agent, attorney or representative of any Party
shall have any liability for any obligations or liabilities of the Parties or
for any claim based on, in respect of, or by reason of, the transactions
contemplated hereby.
5.16 Counterparts.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original and all of which together shall constitute one and
the same instrument. The counterparts of this Agreement may be executed and
delivered by facsimile or other electronic imaging means (including in pdf or
tif format sent by electronic mail) by a Party to the other
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Party and the receiving Party may rely on the receipt of such document so
executed and delivered by facsimile or other electronic imaging means as if the
original had been received.
[Signature Page Follows]

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IN WITNESS WHEREOF, the Parties have caused this Stockholder Agreement to be
executed and delivered as of the date first above written.
ACCESS INDUSTRIES, LLC
By: Access Industries Management, LLC
        Its Manager
By: /s/ Alejandro Moreno 
        Name: Alejandro Moreno
        Title: Executive Vice President
By: /s/ Alex Blavatnik 
        Name: Alex Blavatnik
        Title: Executive Vice President
WARNER MUSIC GROUP CORP.
By: /s/ Paul M. Robinson  
        Name: Paul M. Robinson
        Title: Executive Vice President, General
Counsel and Secretary
[Signature Page to Stockholder Agreement]