DearMichael,

ItiswithdeepsadnessandregretthatIsendyouthisletterofresignationfromtheWaltDisneyCompany,bothasChairmanoftheFeatureAnimationDivisionandasViceChairmanoftheBoardofDirectors.

YouwellknowthatyouandIhavehadseriousdifferencesofopinionaboutthedirectionandstyleofmanagementintheCompanyinrecentyears.Forwhateverreason,youhavedrivenawedgebetweenmeandthoseIworkwitheventotheextentofrequiringsomeofmyassociatestoreportmyconversationsandactivitiesbacktoyou.Ifindthisintolerable.

Finally,youdiscussedwiththeNominatingCommitteeoftheBoardofDirectorsitsdecisiontoleavemynameofftheslateofdirectorstobeelectedinthecomingyear,effectivelymuzzlingmyvoiceontheBoardmuchasyoudidwithAndreaVandeKamplastyear.

Michael,IbelieveyourconducthasresultedfrommyclearandunambiguousstatementstoyouandtheBoardofDirectorsthatafter19yearsatthehelmyouarenolongerthebestpersontoruntheWaltDisneyCompany.Youhadaverysuccessfulfirst10-plusyearsattheCompanyinpartnershipwithFrankWells,forwhichIsaluteyou.But,sinceFranksuntimelydeathin1994,theCompanyhaslostitsfocus,itscreativeenergy,anditsheritage.

AsIhavesaid,andasStanleyGoldhasdocumentedinletterstoyouandothermembersoftheBoard,thisCompany,underyourleadership,hasfailedduringthelastsevenyearsinmanyways:

1.ThefailuretopingbackABCPrimeTimefromtheratingsabyssithasbeeninforyearsandyourinabilitytoprogramsuccessfullytheABCFamilyChannel.Bothofthesefailureshavehad,andIbelieve,willcontinuetohave,significantadverseimpactonshareholdervalue.

2.Yourconsistentmicro-managementofeveryonearoundyouwiththeresultinglossofmoralethroughoutthisCompany.

3.Thetimidityofyourinvestmentsinourthemeparkbusiness.AtDisneysCaliforniaAdventure,Paris,andnowinHongKong,youhavetriedtobuildparksonthecheapandtheyshowit,andtheattendancefiguresreflectit.

4.Theperceptionbyallofourstakeholdersconsumers,investors,employees,distributorsandsuppliersthattheCompanyisrapacious,soul-less,andalwayslookingforthequickbuckratherthanthelong-termvaluewhichisleadingtoalossofpublictrust.

5.Thecreativepaindrainofthelastseveralyears,whichisrealandcontinuing,anddamagesourCompanywiththelossofeverytalentedemployee.

6.Yourfailuretoestablishandbuildconstructiverelationshipswithcreativepartners,especiallyPixar,Miramax,andthecablecompaniesdistributingourproducts.

7.Yourconsistentrefusaltoestablishaclearsuccessionplan.

Inconclusion,Michael,itismysincerebeliefthatitisyouwhoshouldbeleavingandnotme.Accordingly,Ionceagaincallforyourresignationorretirement.TheWaltDisneyCompanydeservesfresh,energeticleadershipatthischallengingtimeinitshistoryjustasitdidin1984whenIheadedarestructuringwhichresultedinyourrecruitmenttotheCompany.

IhaveandwillalwayshaveanenormousallegianceandrespectforthisCompany,foundedbymyuncle,Walt,andfather,Roy,andtoourfaithfulemployeesandloyalstockholders.IdontknowifyouandotherdirectorscancomprehendhowpainfulitisformeandtheextendedDisneyfamilytoarriveatthisdecision.

InaccordancewithItem6ofForm8-KandItem7ofSchedule14A,IrequestthatyoudisclosethisletterandthatyoufileacopyofthisletterasanexhibittoaCompanyForm8-K.

Withsincereregret,

(RoyEdwardDisney)

RoyE.Disney