lease and related agreements pursuant to which, on January 1, 2015, the rent was increased to £3,460,250 per year and the term was extended for an additional five years from December 24, 2020 to December 24, 2025, with a market rate rent review which began on December 25, 2020. On June 26, 2023, the parties entered into an extension on substantially the same terms as the current lease for an additional five years with the lease now expiring on December 24, 2030.
License Agreements with Deezer
Access owns an equity interest in Deezer S.A., which was formerly known as Odyssey Music Group (“Odyssey”), a French company that controls and operates a music streaming service, formerly through Odyssey’s subsidiary, Blogmusik SAS (“Blogmusik”), under the name Deezer (“Deezer”), and is represented on Deezer S.A.’s Board of Directors. Subsidiaries of the Company have been a party to license arrangements with Deezer since 2008, which provide for the use of the Company’s sound recordings on Deezer’s ad-supported and subscription streaming services worldwide (excluding China, North Korea, and Japan (included for subscription services only)) in exchange for fees paid by Deezer. The Company has also authorized Deezer to include the Company’s sound recordings in Deezer’s streaming services where such services are offered as a bundle with third-party services or products (e.g., telco services or hardware products), for which Deezer is also required to make payments to the Company. Deezer paid to the Company an aggregate amount of approximately $41 million, $40 million and $36 million in connection with the foregoing arrangements during the fiscal years ended September 30, 2024, 2023 and 2022, respectively. In addition, in connection with these arrangements, (i) the Company was issued warrants to purchase shares of Deezer S.A. and (ii) the Company purchased a small number of shares of Deezer S.A. The Company also has various publishing agreements with Deezer. Warner Chappell has licenses with Deezer for use of repertoire on the service in Europe, which the Company refers to as a PEDL license (referencing the Company’s Pan European Digital Licensing initiative), and for territories in Latin America. For the PEDL and Latin American licenses for the fiscal years ended September 30, 2024, 2023 and 2022, Deezer paid the Company an additional approximately $2 million, $2 million and $2 million, respectively. Deezer also licenses other publishing rights controlled by Warner Chappell through statutory licenses or through various collecting societies.
On April 13, 2022, the Company entered into an agreement to purchase 900,000 ordinary shares for €9 million of I2PO, a French Société Anonyme and special purpose acquisition company listed on the Paris Euronext Exchange. I2PO merged with Deezer S.A., which was consummated on July 5, 2022. In connection with the merger, preferred shares in Deezer S.A. previously held by the Company were converted into ordinary shares of the combined publicly traded entity. Following the consummation of the merger, I2PO was renamed Deezer.
Relationships with Other Directors, Executive Officers and Affiliates
Distribution Agreement with Mattel
In 2020, a subsidiary of the Company entered into an initial digital distribution and physical license of the existing catalog plus new material of Mattel Inc. The Company earned approximately $2,200,000 and $1,700,000 in connection with the foregoing arrangements during the fiscal years ended September 30, 2024 and September 30, 2023, respectively. The Company’s director, Ynon Kreiz, is the CEO of Mattel and Noreena Hertz, a member of the Company’s board of directors, is a member of the Board of Directors of Mattel.
Employment Arrangement with Val Blavatnik
In 2024, the Company entered into an at-will employment arrangement with Val Blavatnik, pursuant to which Mr. Blavatnik is employed as Special Advisor to the CEO of WMG. Mr. Blavatnik is a member of the Company’s board of directors and is the son of Len Blavatnik, the founder and Chairman of Access and a member of the Company’s board of directors. Mr. Blavatnik’s total annual compensation under this arrangement is approximately $150,000, comprised of a base salary of $125,000 and a target bonus of $25,000.
Director Indemnification Agreements
We enter into indemnification agreements with our directors. The indemnification agreements provide the directors with contractual rights to indemnification and expense rights.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires the Company’s directors, certain officers of the Company, and beneficial owners of more than 10% of the shares of the Company’s common stock to file with the SEC initial
