Big bonuses for Time Warner chiefs

NEW YORK (CNNMoney.com) -- Time Warner, the world's largest media company, disclosed in a regulatory filing Friday that chairman and chief executive officer Dick Parsons received annual compensation of $22.5 million last year, up from $16 million in 2005.

Parsons, who led Time Warner (Charts) through a tumultuous 2006 that saw the company fend off a challenge from activist shareholder Carl Icahn, increase its stock buyback to $20 billion and announce an overhaul of the struggling AOL Internet unit, received a $1.5 million salary last year, the same as 2005. (Time Warner is the parent company of CNNMoney.com.)

Time Warner chairman and CEO Dick Parsons received a bigger bonus last year...

...as did Time Warner COO Jeff Bewkes.

But Parsons' bonus increased from $7.5 million to $8.5 million. In addition, his options and restricted stock grants were worth $11.9 million last year, up from $6.56 million in 2005.

Time Warner's stock rose 26 percent in 2006, joining in a media stock rally that also lifted shares of competitors News Corp. (Charts), Walt Disney (Charts) and CBS (Charts).

In its filing with the Securities and Exchange Commission, Time Warner said that Parsons' bonus "should be clearly linked to the company's financial performance" and added that he "also effectively addressed challenges facing the company during 2005 and 2006 through significant efforts to reach out to investors, regulators and the business community."

Time Warner also completed its joint acquisition of bankrupt cable provider Adelphia with Comcast (Charts) last year, setting the stage for Time Warner to sell a stake in its Time Warner Cable (Charts) unit to the public this year.

In addition, Time Warner disclosed that president and COO Jeff Bewkes, who is widely expected to succeed Parsons as CEO when Parsons' contract runs out in May 2008, also received a boost to his overall compensation package last year.

Bewkes saw his salary increase from $1 million in 2005 to $1.25 million last year while his annual bonus rose to $7.5 million from $6 million. Overall, Bewkes' total compensation last year, which includes stock options, restricted stock and other compensation, was $18.7 million, compared to $12.5 million in 2006.

Shares of Time Warner slid 13 cents, or 0.7 percent, to $19.72 a share in regular trading on the New York Stock Exchange Friday. The stock has fallen 9 percent year-to-date.

Separately, Time Warner disclosed that Ed Zander, the CEO of embattled cell phone maker Motorola (Charts), would not seek re-election for Time Warner's board of directors at the Time Warner's next annual shareholder meeting on May 18.

Zander, who just joined the Time Warner board in January, will serve as a director until the board meeting. Time Warner said in a filing that Zander decided not to run for Time Warner's board again "in light of the increased challenges facing Motorola, Inc. and the additional time commitments associated with his position at that company."

Motorola is now facing pressure from Icahn to boost shareholder returns.

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The reporter of this story owns shares of Time Warner through his company's 401(k) plan.