[mickey]

TO: The Directors of the Walt Disney Company:

After nearly 21 years as CEO of The Walt Disney Company, it is with a wide range of positive emotions that I welcome the Board of Directors' announcement of my successor, Bob Iger. As the Board has wisely concluded, Bob is an extraordinary executive with 30 years of experience in the entertainment industry and is uniquely qualified to take charge of this incredible company. As president during the past five years, he has provided steady and inspired leadership as he helped steer Disney through a storm of challenges, bringing the company to its current thriving condition in the calm waters and bright skies of financial and creative success. As you well know, last year alone, we delivered earnings per share growth of more than 60%, resulting in record earnings and free cash flow. This fiscal year, we will deliver double digit earnings growth and again post record-high earnings. From a shareholder perspective, Disney has outperformed the other three major media companies over the last five year, three year, and one year periods.

So, it is with a considerable amount of satisfaction and even pride that I approach the end of my term as CEO of this company. There is a tinge of sadness added to these emotions, similar to the feeling one experiences at the end of a great day at Disneyland as one pulls into the station after the final E-ticket ride.

And what a ride this has been. In 1984, the company had a $2 billion equity market cap. Today, it is nearly $60 billion. Revenues were $1.5 billion; in 2004, they surpassed $30 billion. Net income was $98 million; last year, it was more than $2.3 billion.

Our creative achievements around the world in the fields of film, broadcast and cable television, consumer products and theme parks have been exceptional, driving compound annual returns for Disney stock since 1984 of 17.3%, versus the S&P 500's 13.0%. More recently, despite that storm of challenges, Disney investors have been rewarded with a 6.5% annual return during the past three years, compared to the S&P 500's 3.0%, and in the last year with 11.6% versus the S&P's 10.3%.

Disney's remarkable financial and creative growth has been achieved by a phenomenal management team. We currently have in place a group of executives who are focused, able and experienced. They have kept the company moving forward and have not been distracted by the combustion of world events or the noise of Hollywood gossip. These are seasoned individuals who have the vision to set lofty goals and the leadership to achieve them. They know the receptivity, the affection and the respect the Disney name and products command from continent to continent. We can count on them to continue to distribute creativity throughout the world, intellectual excellence throughout the world, ESPN and Disney throughout the world. Hong Kong Disneyland (our front door to China), opening on Sept 12th of this year, along with the resort around it, is but one example.

Bob will now continue the momentum of the company and put his own visionary imprint on it as he launches Disney into the future. As I have told Bob and all of you, I am available to assist in a seamless and orderly transition. Although I intend to remain as a Disney director until the annual meeting of 2006, I will not make a request of the Board to nominate me for an additional term nor will I seek the chairmanship of the company after the retirement of Senator Mitchell.

This brings me to yet another emotion I feel as the transition begins -- excitement, excitement about a book I wrote called "Camp," which gets released on Father's Day and perhaps will lead to the camp of my youth, Keewaydin, hiring me as a counselor again, excitement that my oldest son Breck got engaged to Georgia Irwin yesterday just four weeks before "Sahara," a film he directed, gets released by Paramount Pictures, excitement about all the possibilities I see before me. As much as I have loved nearly every minute of my tenure at Disney, two decades is enough time to spend as a chief executive officer of one company. I'm ready to move on and climb new mountains, while always being available to help Disney in any way I can. Beginning October 1, I expect to clean off my hiking boots, re-stock my Mickey Mouse backpack and start surveying some of the other peaks that are on the horizon.

I thank members of our management team, our entire cast, our shareholders, and the men and women who serve or have served on our Board for their enthusiasm and support for The Walt Disney Company. And mostly I thank Walt Disney for bringing to us a culture and a mouse.

Gratefully,

Michael