Early Fireworks at AOL Meeting

Updated from 1:07 p.m. EDT

It didn't take long for AOL Time Warner's (AOL) shareholder meeting to turn contentious on Friday.

But the banged-up media and entertainment company made it through intact, as all directors were re-elected to the board and shareholders supported management on all other issues up for vote -- to varying degrees.

With AOL Time Warner's stock well below where it was at the company's founding in 2001, with the America Online unit dogged by problematic revenue recognition, and with organizations such as the California Public Employees' Retirement System questioning corporate governance policies, outsiders expected a bumpy meeting.

Such forecasts were quickly confirmed only a few minutes after AOL Time Warner CEO Dick Parsons launched official business Friday morning.

First, a representative of the American Federation of State, County and Municipal Employees complained about AOL Time Warner's fight against the AFSCME pension fund's efforts to democratize the director nomination process. Soon afterward, a representative of the AFL-CIO, of which AFSCME was a part, followed up on the same issue.

Parsons, who had been attempting simply to list six resolutions to be voted on at the meeting, ruled the first interrupter's point of order "out of order," then asked the second to delay his comments until the designated discussion period.

Once that Q&A session began, an even-tempered, good-humored Parsons heard questions on issues like executive pay, the company's business in China, and AOL Time Warner's proxy nomination process.

Shareholders in attendance applauded various critical questions, while also applauding Parsons' request that people asking questions try to shorten the speeches they delivered prior to asking.

One attendee complained that director Ted Turner -- one of the directors running for re-election -- had damaged the company by making a spectacle of himself. Parsons replied, "Ted has been -- is -- one of our most valuable directors," calling him one of the half-dozen most "impactful" business figures in recent decades. "Thank you, Ted, for agreeing to sign up again," said Parsons.

According to the unofficial ballot results announced at the meeting's close, shareholders supported the company's executive bonus plan and the ratification of its auditor by margins of more than 90%, and followed management's suggestion, by similar margins, to vote against shareholder resolutions related to business in China and to disparities in pay between executives and low-level employees.

The stock incentive plan -- which proxy advisory firm Institutional Shareholder Services had recommended voting against -- passed by a 70% margin.

Several of the company's directors -- including now-former chairman Steve Case and former Netscape chief Jim Barksdale -- had drawn fire in the lead-up to the meeting for various reasons, including the company's performance under their stewardship.

Nine of AOL Time Warner's 13 directors, including Parsons and Turner, were re-elected by margins of at least 96%.

Veterans of the former America Online fared worse. Case received 78% of votes that could have been cast for his re-election; his lieutenants, Kenneth Novack and Miles Gilburne, received 82% and 65% of votes, respectively. Barksdale -- who, like Gilburne, some found objectionable because of his status as an "affiliated" outside director on a board committee -- received 79% of possible votes.

AOL Time Warner's shares were trading at $14.00 Friday, up 2 cents.

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