```htmlWarner Bros. Discovery: Executive Agreements Analysis

Warner Bros. Discovery, Inc.

Analysis of Executive Agreements and Compensation Structures

Report Date: June 17, 2025

Executive Summary

This report provides an analysis of the executive agreements and compensation structures at Warner Bros. Discovery, Inc. (WBD), based on publicly available information, primarily the company's 2024 Proxy Statement. Executive agreements at WBD are designed to attract, retain, and motivate key leadership talent critical to the company's strategic objectives, particularly following the WarnerMedia-Discovery merger.

Key components of these agreements typically include base salary, annual performance-based cash bonuses, long-term equity incentives (stock awards and/or options), and other benefits, including potential severance payments under certain termination scenarios and change-in-control provisions. The compensation philosophy emphasizes pay-for-performance, aligning executive interests with shareholder value creation and successful integration and synergy realization post-merger.

The total compensation for Named Executive Officers (NEOs) reflects their roles, responsibilities, and performance against strategic goals. This report details the compensation for top executives for the fiscal year 2023 and discusses the general framework of their employment agreements.

Framework of Executive Agreements

Executive agreements at Warner Bros. Discovery are formalized through individual employment contracts that outline the terms and conditions of employment for senior leaders. These agreements are overseen by the Compensation Committee of the Board of Directors, which aims to ensure that compensation is competitive, performance-driven, and aligned with shareholder interests.

Core elements of these agreements include:

• Base Salary: Provides fixed compensation reflecting the executive's role, experience, and responsibilities.
• Annual Cash Incentives: Performance-based bonuses tied to the achievement of pre-determined financial, operational, and strategic goals for the company and, where applicable, individual performance. For 2023, these goals often centered around financial targets like Free Cash Flow and synergy realization.
• Long-Term Incentives (LTIs): Primarily delivered through equity awards (e.g., restricted stock units (RSUs) and performance stock units (PSUs)). LTIs are designed to retain executives, align their interests with long-term shareholder value, and reward sustained performance. Vesting schedules typically span multiple years.
• Benefits and Perquisites: Standard benefits package, plus certain perquisites which vary by executive but may include items like personal use of company aircraft (with reimbursement for incremental cost), security services, and financial planning assistance.
• Severance and Change-in-Control Provisions: Agreements typically include provisions for payments and benefits upon certain qualifying terminations of employment (e.g., termination without cause or by the executive for good reason), often enhanced in connection with a change in control of the company. These are intended to provide stability during periods of transition and retain executives through such events.

For example, Mr. Zaslav's amended employment agreement, effective January 1, 2022, and running through December 31, 2027, specifies his base salary, target annual bonus opportunity, and annual equity grant guidelines. It also contains detailed provisions regarding termination and severance.

Executive Compensation Details (Fiscal Year 2023)

The following table summarizes the compensation for Warner Bros. Discovery's Named Executive Officers (NEOs) for the fiscal year ended December 31, 2023, as reported in the company's 2024 Proxy Statement.

Note: Option Awards for 2023 were $0 for these NEOs as per the Summary Compensation Table. Significant option awards related to the merger were granted in prior years. "All Other Compensation" includes items such as company contributions to retirement plans, perquisites, and other personal benefits. Gerhard Zeiler's salary was paid in EUR and converted to USD for reporting purposes.

Visualization of Key Compensation Components (2023)

The chart below illustrates the breakdown of key compensation components (Salary, Stock Awards, and Non-Equity Incentive Plan Compensation) for the NEOs in 2023.

Key Contractual Terms and Considerations

The employment agreements for WBD's NEOs contain several key provisions that are critical for understanding the nature of these executive arrangements:

• Term: Most agreements specify a multi-year term, subject to renewal or extension. For example, Mr. Zaslav's current agreement extends to December 31, 2027.
• Performance Metrics: Annual bonuses and PSU vesting are typically tied to specific performance metrics. For 2023, these often included targets related to Free Cash Flow, Adjusted EBITDA, and synergy realization from the WarnerMedia merger. The Compensation Committee retains discretion to adjust payouts based on overall company performance and other qualitative factors.
• Restrictive Covenants: Agreements generally include restrictive covenants such as non-competition, non-solicitation (of employees and business partners), and confidentiality clauses, which apply during employment and for a specified period post-termination.
• Clawback Provisions: WBD maintains clawback policies that allow the company to recoup incentive compensation in certain circumstances, such as a financial restatement due to material noncompliance with financial reporting requirements or executive misconduct.
• Stock Ownership Guidelines: Executives are typically subject to stock ownership guidelines, requiring them to hold a certain amount of company stock, further aligning their interests with shareholders.

These agreements are complex legal documents tailored to each executive, reflecting negotiations and the company's strategic needs. The terms are designed to be competitive within the media and entertainment industry to secure and retain top-tier talent essential for navigating a rapidly evolving market landscape.

Citations

• Warner Bros. Discovery, Inc. (2024). DEF 14A: Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934. Filed April 26, 2024. Available at: SEC EDGAR Database (Specifically, refer to the "Compensation Discussion and Analysis" and "Executive Compensation Tables" sections).
• Warner Bros. Discovery Investor Relations. (General reference for company information). Available at: https://ir.wbd.com/

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