In the darkness, I was squinting as I tried to read the time on my watch. Suddenly, the realization hit me like a jolt of lightening – “Oh my gosh! It’s ten minutes to one!” The meeting had started at 10:00 AM, and was supposed to end at noon! How could this have happened? What was I going to do now?

I was sitting inside the Grand Ballroom of the Pennsylvania Convention Center watching a preview for “The Incredibles,” the next (and second-to-last) Pixar film to be released by Disney. Studio Chief Dick Cook was giving a presentation on his business unit. My sudden realization of the time, and the accompanying minor heart attack were due to the fact that I was supposed to be checking out of my hotel in ten minutes!

The meeting had run nearly an hour longer than anticipated, and Dick Cook was only the first to present his business unit! We still had to hear from Consumer Products, Parks & Resorts, and Media Networks – not to mention the much anticipated Question and Answer session, and the announcement of the results from the earlier proxy votes! It seemed like we were just getting started!

I had arrived at the Convention Center nearly 7 hours earlier to make sure I would get a seat. Registration didn’t begin until 8:00 AM, and seating wouldn’t be available for another 30 minutes after that.

The Grand Hall, outside of the Grand Ballroom, served as the registration area. Positioned around the hall were the 75 Mickey statues (in honor of Mickey’s 75th birthday) that had made an early departure from Walt Disney World to make a special appearance at the meeting. Having already had my admittance ticket, I proceeded directly to the Grand Ballroom.

Upon entering the Grand Ballroom, I first noticed three large projection screens. Each had a blue background and announced that this was the 2004 Annual Shareholder’s Meeting. Strains of famous Disney music filled the room as the shareholders filed in.

In front of the center screen was a stage set with two podiums (both with the Walt Disney Company logo on the front) and a skirted table with four microphones sitting in between, but further back.

As we sat there, the left and right projection screens would occasionally cut to a camera that was in the registration area, showing Mickey, Minnie, Donald, Cinderella, Snow White, and maybe a few other characters interacting with the crowd in what was now an enormous line. Then the screens would cut away to an old Mickey Mouse short for our entertainment while we waited for the meeting to start.

First up was Steamboat Willie, followed by Through the Mirror, The Band Concert, Mickey’s Boat Builders, and Clock Cleaners. What with all the Disney characters, the 75 Mickey statues, the Mickey cartoon shorts, the heart-felt Disney music… I almost forgot where I was… I almost forgot what I had come here for… Everything was so… MAGICAL! How could anyone criticize Disney? Things are just fine!

[abrupt sound of needle scratching record]

Suddenly, I realized that I was being subtly brainwashed. Michael Eisner had obviously coordinated all of these things to play on the emotions of shareholders and distract them from some of the issues at hand. Well, no more! His tricks won’t work on me! I’m going to keep my attention firmly focused on… Oh look! Mickey…!

Er, um… anyway… Shortly after 10:00 AM, the lights dimmed, and we were greeted by the man of the hour (or at least that’s what HE thought…), Michael Eisner himself. He didn’t waste a second as he launched into a speech about how well and prosperous the company is doing, how the stock has gone up 60% since the last meeting, how earnings per share had gone up, blah blah blah… blah, blah, blah… Okay, I was no longer enchanted. Now it was just business talk.

He spoke for several minutes talking about how “pleased” they are with all of the various business units, how bad the Pixar deal would have been for them, and how they are “disappointed” by the ABC primetime ratings. When he was done, he introduced Senator George Mitchell, who took the stage to discuss governance issues.

Senator Mitchell talked for several minutes about all the actions that the Board has taken to improve the governance of the company, including the mandatory retirement age of 72 – the supposed reason Roy was in effect thrown off the Board. He then introduced all 11 of the Directors as their pictures appeared on the large screens behind him.

After giving brief biographies of the directors, Senator Mitchell invited out two retiring Directors to give brief remarks – Thomas Murphy and Raymond Watson. Both men spoke fondly of their tenure on the Board of Directors, and seemed to use every moment they could to sing their praises for Michael Eisner. In fact, it was at this point that I started to realize how repetitive things were becoming. Things were starting to sound almost forced, at least to my ears.

Regardless, when the two retiring Directors were finished, Michael Eisner returned to the stage to begin dealing with the business at hand – namely, the election of Directors, ratification of the company’s independent auditors, and voting on three shareholder proposals.

After a brief report on the outstanding shares of common stock entitled to vote, Michael again read the names of the 11 Directors up for re-election.

“As you know, the Board has recommended a vote FOR the election of all the nominees,” Michael said.

He then paused briefly before continuing on, “As I’m sure you also know, this election has been the subject of a campaign by two former Directors to encourage shareholders to withhold their votes from certain Directors. In the interest of promoting an orderly presentation of the issues, the Board has reached an agreement with our former Directors, Roy Disney and Stanley Gold, to permit them to state THEIR views.”

My jaw hit the floor. Could it really be true that Michael Eisner was allowing Roy Disney and Stanley Gold a microphone to speak to the shareholders at this meeting? I couldn’t believe it!

“So, at this time, I invite Roy Disney and Stanley Gold to present their positions. As agreed, gentlemen, you have fifteen minutes.”

With this, the entire room (minus the people seemingly planted in the reserved seating at the front of the room to applaud Michael as if on cue at various points throughout the meeting) was on their feet. Cheers, whistles, shouts, and loud applause filled the room as Roy and Stan approached their podium – not on the stage, mind you, but way off to the side where no one could really see. At least they were kind enough to put a camera on them so we could watch on the projection screens.

Stan Gold spoke first. Like Michael, he didn’t waste any time getting to the figures. He jumped right in to how the company has under-performed over the past decade. His remarks were pretty pointed and damaging to the board, making them seem like all they do is sit around and do absolutely nothing.

“The fact that we had a CEO who refused to brook criticism, nurture talent, or even groom a successor did not seem to bother the Board. The fact that Disney stock – for almost a decade – was under-performing – not just the market as a whole, but the media sector in particular – did not seem to bother the Board. The fact that operating income was virtually flat for nearly a decade despite the reinvestment of some $15 billion in capital did not seem to bother the Board. The fact that management's glowing projections and flashy business plans didn't pan out – time after time after time – did not seem to bother the Board.”

I couldn’t help but smile as I sat there and listened to Mr. Gold speak. Now THIS is what I had come all this way for! Then, Stan made a startling prediction:

“It is my belief that, after the votes are counted, from the preliminary results, more than 40% of the shareholders will have withheld their votes from Michael Eisner being re-elected to this Board, an unprecedented vote of no confidence in the annals of American business. Moreover, I believe that approximately 20% of shareholders have withheld their votes for the re-election of Directors George Mitchell, John Bryson and Judith Estrin.”

I couldn’t believe what I was hearing. I had been hearing 20% to 30% maximum. But over 40%?!? He must have lost his mind… Stanley continued his attack on the board:

“When the Company bought the Fox Family Channel (re-named A.B.C. Family Channel), the Directors were given a positive presentation on how our Company would change programming and produce a 20% annualized internal rate of growth over the next 5 years. When that failed to materialize, a mere 3 months after acquisition, the Board held no one accountable. No executive was fired, no executive was criticized -- but both Mr. Eisner and Mr. Iger received -- in my opinion -- lavish and unjustified bonuses. While we, the shareholders, watched the value of our equity decline, Michael Eisner has never had a bad year.”

For the second time, the audience let out cheers and loud applause, while the small delegation of “plants” remained firmly seated, motionless… Stan continued on:

“The Board had disregarded common sense; they declared me as a non-independent director because my daughter worked for the Company in a non-executive position -- but simultaneously crafted rules to keep John Bryson, an Eisner loyalist, independent -- notwithstanding his wife's employment by the Lifetime Channel, a 50% owned subsidiary of The Walt Disney Company where she was paid multiples of my daughter's compensation.”

Oooooo…. This is getting GOOOOOOOOD! And then, the kicker:

“Shareholders have waited too long and have spoken too clearly. Michael Eisner must leave now!”

With that, the audience again erupted in cheers and applause. I took a quick glace over at Michael, who had retreated from his podium to a seat behind the skirted table where he sat with his elbow supporting his chin as if he couldn’t be any less interested in what Stan was saying.

Stan then began to wrap up his comments. But he made it clear that this is just the beginning of their fight.

“It is our intention to be here next week, next month and next year. It is our intention to be here for as long as it takes. We intend to press forward and keep Disney management, and especially it’s Board, accountable.”

Shortly after that, Stan wrapped up his comments, and stepped down from the podium. I glanced at my watch, and realized that he had spoken for nearly the entire 15 minutes! Just then, I noticed Michael once again standing behind his podium up onstage as the lights came up on him. He leaned in toward the microphone as if he was preparing to speak. But, instead of hearing Michael’s voice, we heard Roy’s:

“I would hope that, although management has been rather clear about giving us EXACTLY fifteen minutes and no more, that if we run a little bit long that they won’t cut off the microphone.”

Roy was staring directly at Michael up on the stage as he made this comment. Michael, not saying a word, simply turned around, and went back to take his seat behind the table. The audience cheered again.

Roy started out by saying, “The Walt Disney Company is more than just a business. It’s an authentic American icon,” to which he received more cheers and applause.

Roy’s comments were not as pointed as Stan’s, and he didn’t have any really good punches like Stan did. But he did speak about how he feels the company needs to get back to the core of what makes Disney, Disney – films and animation. He also spoke about creativity, and how it is often difficult to quantify, but you notice when it isn’t there. He talked about how important it is to continue to nurture this creativity.

Roy went on to talk about branding, and how he feels that Disney is not something that should be branded. As he put it, “Branding is what you do when there’s nothing original about your product”

Roy then discussed his ideas of how to return the Walt Disney Company to its former glory. One of the first things Roy suggested is, “trusting the talents and imagination of its creative people” and “supporting them with the resources they require.”

He continued on saying, “consumers know when they’re getting value for their money, and they know when you’re trying to sell them second-hand goods.”

“We need to install a new management team… and this management team has to understand and believe in the enormously valuable legacy that’s been entrusted to all of us.”

Wrapping up after speaking a brief seven minutes, Roy made his final point. “As long as we continue to believe in the power of creative ideas, then our best years will still lie ahead”

With the conclusion of Stan and Roy’s comments, the crowd once again was on their feet cheering and applauding the duo. Then, once again, Michael Eisner took the stage.

“Thank you Roy, thank you Stanley… that was enjoying,” to which the sound of laughter filled the room.

Michael then proceeded to belittle the arguments of the two saying that, “the conclusions that you’ve just heard are fundamentally wrong … I believe you have just heard rhetoric from our critics that frankly replaces reason.”

Michael’s speech seemed prepared, as if he had already rehearsed what he was going to say. He once again reinforced the recent increases in stock price, and restated that he feels the company is on track to meet the projections they have announced. After the rebuttal, Michael opened the floor for discussion on this issue only.

And then, we met Evelyn.

Evelyn Y. Davis, to be exact. Evelyn is well-known in the business community as a corporate “gadfly,” or to put it nicely, a royal pain in the butt. Apparently, Evelyn makes a living out of traveling around the country to attend shareholder meeting for the more than 100 companies she is invested in.

Evelyn is a 70-something, grandmotherly-looking woman originally born in Amsterdam (did a little Google search!). But looks are deceiving. Once she got to the microphone, I could hardly understand her as her Germanic accent echoed through the room at near ear-piercing decibels. Although she indicated that she had voted for Michael, she went on to explain that she feels the positions of Chairman and CEO should be separated. She talked well past her 3-minute allotment, and eventually, they had to cut off her microphone. Even then, she still continued to talk. Finally, Michael had to cut her off in the interest of moving the meeting along, quipping, “I thought STANLEY was difficult!”

But that wasn’t the end… Any time the microphones were opened for discussion, Evelyn would always have something to say on the subject at hand. At one point, another elderly gentleman was speaking, and Evelyn tried to interrupt him, to which he then turned and shouted to her, “Wait a minute! You had your chance! Sit down and shut up! Shut up!” (To which the audience resoundingly cheered and applauded!)

But Evelyn wouldn’t be the only one scolded. Later on, Michael Eisner himself received a tongue lashing from a shareholder who was speaking to him when he turned around to ask Bob Iger if he would prefer to address her question. The shareholder exclaimed, “Excuse me, I believe I’m talking to you, not to the back of your head!”

And so, eventually, the brutal business portion of the meeting was concluded, and Michael then proceeded to march out the heads of each of the company’s major divisions to talk about all the great things that are going on.

First up, was Bob Iger, Chief Operating Officer. Bob gave a brief overview of each division and the overall performance of the company. He also used his time to sing the praises of Michael Eisner and the board. Shortly thereafter, Bob introduced Tom Staggs, the Chief Financial Officer, to discuss in detail the financials of the company and the increasing shareholder value. Tom also used his time to sing praises of Michael Eisner and the management of the company.

After Tom was finished, Dick Cook appeared on the stage to discuss the state of the Studio operations. But, before he got underway, Dick also took some time to talk about how great Michael Eisner is, and all the wonderful things he does. (It was getting a little old at this point) It was shortly after this that I glanced at my watch only to be horrified by the time I saw. But Dick Cook’s presentation was really spectacular, showing multiple trailers for films that I hadn’t even heard of yet. While I wasn’t necessarily overly impressed with some of the projects that were displayed, I did enjoy the fact that I was getting an “inside look” at what’s in the pipeline before anyone else! I decided that at the very least, I would have to stay through Jay Rasulo’s presentation on the Parks and Resorts division.

So, I sat for another 45 minutes. Andy Mooney, Chairman of Disney Consumer Products Worldwide was next with a tremendously boring presentation on the Consumer Products division (and another dissertation on how Michael Eisner is the best thing that ever happened to this company). Once that was completed, the room fell dark, and we heard the beginning strains of “Beauty and the Beast,” as the screens in the front of the room came alive with images from the theme parks. Finally!

After the video presentation had concluded, the lights came up on Jay Rasulo, now standing at one of the podiums on the stage. Jay (after his obligatory praise of Michael Eisner) discussed the recent increases in attendance at the parks, and some of the new projects that are currently in development for the parks. I was hoping for some great photos or even a video presentation of some of these projects, but we didn’t get one. Basically, we got a rehash of what is in the Annual Report. I probably can get a better idea of how these projects are coming along by visiting Disney fan websites. Disappointed in Jay’s presentation, I decided that it was time to go.

By this time, it was after 1:30 PM. I made my way out of the darkened room as clips of various ABC programs were shown on the screen. I made my way out of the Pennsylvania Convention Center, and back to my hotel. I had mixed emotions as I packed my bags and got ready to leave. I had come all this way, and now I couldn’t even stay until the end of the meeting. How could they have let it run so long? Had they done this on purpose? I didn’t even know what the vote would be! But I had a 10 hour drive home, and I was already looking at a midnight arrival. I couldn’t stay any longer.

Next week, Corey will wrap up this series with his reaction to the vote results, and his own personal opinions on the whole Roy vs. Eisner conflict. Stay tuned!