Annual Meeting Notes

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By norton35
March 4, 2004

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I'm sorry to post this so late after the event, but I was among the hardy few who stayed at the annual meeting to the brutal end at 3:30. Afterwards I had to rush to check out of my hotel, grab something to eat (the meeting went right through lunch without a pause) and get myself back to Connecticut. As Alice has already posted, I sat next to her and like her I was very moved by seeing Eisner publicly humbled. By the ending of the meeting, I was truly exhausted by the emotions in evidence there. You have probably read all about the meeting in the papers by now, but I think my report will have some small details that might interest the posters on this Board that were beneath the notice of the press.
At least someone at Disney has a sense of humor. At the conclusion of the almost 6 hour meeting, those stockholders who managed to last to the end left the hall to the taunting strains of "Who's Afraid of the Big Bad Wolf?" coming from the loudspeakers. Just before this Eisner adjourned the meeting before the results of the vote were announced. As people shouted out "the vote, the vote" he came to his senses, reopened the meeting and allowed the results to be revealed.

This was just one of the signs that Eisner really was rattled by the Big Bad Wolves.
I was fortunate enough to find Alice quite by chance among the 3000 attendees. She told me about her harrowing solo flight into Philadelphia among unfamiliar landmarks and runways perilously close to each other. She had called me at my hotel at 7:00 to say that if I didn't get to the convention center right away I might risk not making it to the meeting. I skipped breakfast and hopped in a cab. Evidently the Philly Convention authority is almost as astute as Disney at managing lines, because at first it appeared there was hardly anyone there. Once the doors opened, however, I arrived at the registration area to find several thousand people waiting to check coats, receive admission tickets and pass through security. Michael, Minnie, Donald and some Princesses enlivened the scene, as did the many 6-foot high, differently painted Mickey figures (part of the Inspearation program celebrating 75 years of Mickey). I saw the ones designed by John Travolta (an airplane theme), Jennifer Garner (celebrating espionage) and Shaq. There was a nice display of a well-made Pooh line that Target will be introducing soon.

The meeting began with a film of highlights of coming features: Raising Helen, Jersey Girl, Kill Bill 2, Hidalgo, Alamo, King Arthur, Sacred Planet, Mr. 3000 and The Village. Then Michael Eisner appeared wearing a red tie with Blue Mickeys (as a lawyer who has studied trial practice I pay a lot of attention to the ties men wear when they are seeking approval). His voice was hoarse and cracked at the beginning and only grew worse as the day wore on. He made a few remarks about leveraging competitive advantage, creating quality family experiences and the Pixar breakup. He introduced George Mitchell who made some bland comments about corporate government improvements. Tom Murphy and Ray Watson said farewell, at the same time expressing support of Eisner and Iger. Watson got applause when he said he was going to celebrate his 50th wedding anniversary by taking a cruise on one of the Disney ships.

Next Eisner brought up the allegations being made by Stanley and Roy and said quite firmly they had 15 minutes to address the meeting and they were expected to comply with the rules. The men were greeted by enthusiastic applause and some standing ovations. They did not speak from the stage but from a microphone in a far corner. If it weren't for the video screens they would not have been visible to the majority of the audience. Stanley Gold spoke first. He smartly wore a tie with small American flags on it. Stanley spoke for almost twenty minutes and really dressed down Eisner.

Be patient, I'm getting to the part about Alice. It seemed that Roy would not get not to speak, but he approached the microphone and looking right at Eisner said he hoped he would not be cut off for exceeding the 15 minute limit the chairman was so adamant about. It was a chilly moment. Roy wore a green tie with yellow-shoed Mickeys on it. He took issue with the notion that Disney is a brand. He said it is a name, and that name stands for things that can't be quantified but that affect every product the company releases. Branding is for cows, he said, a way to differentiate things that are identical (I don't know if this was a veiled reference to the upcoming "Home on the Range"). He continually stressed the importance of creativity and giving guests respect and value (in short, Magic) and not leaving them with the impression that Disney is after their last buck. He received a standing ovation and it was surely this quiet man's finest public moment and one that I'm sure will live on in Disney history.

When the dissenters finished, revealing his never failing ease before a crowd, Eisner cracked "Well, that was a joy." At that point, the floor was opened to questions and comments regarding the Roy-Stanley issue. This is when corporate gadfly Evelyn Y. Davis almost kidnapped the meeting. She did make a reasonable proposal that Sid Bass would make a good chairman of the board, but then she wouldn't stop speaking and interrupted the meeting several times by shrieking over Eisner from her seat. He never lost his composure, however.

Enter Alice. She asked Michael if he remembered her. "Yes. Pentagon Mall."
"Pentagon City," Alice corrected. I'm going to paraphrase what happened next. I'm not a reporter so I may have a few of the words down wrong. "You said you know me, Michael. Then you know that I have supported you at past meetings, though not always outside the meetings. I'm going to support you again, because the pension funds want to decapitate the company, don't care about Magic and are looking after their own agendas. But Roy Disney's resignation letter resonated with me because it said many of the things that were in my own resignation letter from the company. The cast members have been saying these things for a long time. You need to get out and talk to the cast."

Eisner thanked Alice. He let her speak for quite a while and I did not get the impression that he was cutting her off, despite what Alice felt. I thought he treated her respectfully and I think it speaks volumes about both of these individuals, Michael and Alice, from such opposite ends of the corporate pyramid, that they know each other and have managed to form a relationship of sorts. Can you imagine this happening at Fox, Viacom or GE?

I have nothing to add about the corporate presentations. It was a star-studded affair, with some bright moments like Dick Cook of the film studio showing previews of new films. He announced that Pirates 2 and 3 will be filmed at the same time and will be released close together in the summer and Christmas of 2005. What a year for the box office that will be! He got a big hand too when he announced that Disney will be adapting the Chronicles of Narnia series, forming a franchise to rival The Lord of The Rings and Harry Potter. Ultimately though I wondered if the many presentations were meant to showcase the company's creativity or drain the hall before the shaming results of the vote were announced.

It was a meeting I will never forget. I will post again later about the question and answer period at the end of the meeting.
David (norton35)

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