Walt Disney Company (DIS)

Certain Relationships and Related Party Transactions

Director John Bryson’s wife, Louise Bryson, serves as President—Distribution and Affiliate Business Development for Lifetime Entertainment Television, a cable television programming service in which the Company has an indirect 50% equity interest. Ms. Bryson received an aggregate salary (including car allowance and payments of deferred compensation) of $595,853 for her services with Lifetime during fiscal 2005 and received a bonus of $548,173 in fiscal 2005 with respect to her services in fiscal 2004. She is also eligible for an annual bonus for fiscal 2005, although as of December 31, 2005, no bonus determination for 2005 had been made by Lifetime with respect to Ms. Bryson. By agreement among the Company, Lifetime and Lifetime’s other equity owner, The Hearst Corporation, neither the Company nor any of its employees or affiliates participates in any decision making at Lifetime with respect to Ms. Bryson’s performance or compensation. In addition, as noted above, Lifetime acquired programming and purchased advertising time from, and sold advertising time to, Company subsidiaries, but the Company believes that neither Mr. Bryson nor Ms. Bryson had a material direct or indirect interest in those transactions.

Company President and Chief Executive Officer and Director Robert Iger’s father-in-law, Eugene Bay, is a principal of

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Table of Contents

The Walt Disney Company Notice of 2006 Annual Meeting and Proxy Statement

Eugene Bay Associates, Inc., a marketing company that has been retained by the Company’s subsidiary ESPN, Inc. since 1990 (prior to Mr. Iger’s marriage to Mr. Bay’s daughter) to provide sports marketing services. Mr. Bay’s company received a total of $145,820 for services provided during fiscal 2005.

Director George Mitchell is Chairman and a partner of DLA Piper Rudnick Gray Cary LLP (DLA Piper Rudnick), an international law firm. Attorneys who joined that firm during the last fiscal year represented the Company on a minor matter prior to the merger of their firm with DLA Piper Rudnick and are concluding that representation following the merger. The total amount paid to DLA Piper Rudnick by the Company with respect to this matter during fiscal 2005 was less than $2,000.

Pursuant to the provisions of the Company’s bylaws and indemnification agreements, fees and other expenses incurred in connection with derivative litigation against current and former Directors relating to the employment agreement with the Company’s former president, Michael S. Ovitz, as described in the Company’s 2005 Annual Report on Form 10-K, are being advanced on behalf of those Directors by the Company or the Company’s insurer. Accordingly, from the beginning of fiscal 2005 through December 31, 2005, the Company advanced (or provided services at the Company’s cost in an amount equal to) $4,324,037 for such fees and expenses, including legal fees, relating to the foregoing matters on behalf of such current and former Directors including Michael D. Eisner, George J. Mitchell, Leo J. O’Donovan and Gary L. Wilson. Of this amount, $4,181,681 was paid to a law firm representing current and former Directors including Messrs. Mitchell and Wilson and Fr. O’Donovan and the remainder was advanced for other related expenses. The Company has been reimbursed by the Company’s insurers for a majority of such advances and has submitted or will submit to the insurers demands for reimbursement for the remaining amounts that have been advanced. Additional amounts (not included above) were paid directly by the Company’s insurers.