ABC, INC. SAVINGS & INVESTMENT
PLAN
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998 AND 1997
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998 AND 1997
Report of Independent Accountants F-2
Statements of Net Assets Available for Benefits F-3
Statement of Changes in Net Assets Available for Benefits F-4
Notes to Financial Statements F-5
Supplemental Schedules
Schedule I - Line 27a: Schedule of Assets Held for
Investment Purposes F-16
Schedule II - Line 27d: Schedule of Reportable Transactions F-17
Other schedules required by Section 2520.103-10 of the Department of Labor Rules
and Regulations for Reporting and Disclosure under ERISA have been omitted
because they were not applicable.
F-1
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
June 22, 1999
To the Participants and the Employee
Benefits Committee of the ABC, Inc. Savings & Investment Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the ABC, Inc. Savings & Investment Plan (the "Plan") at December 31, 1998 and
1997, and the changes in its net assets available for benefits for the year
ended December 31, 1998, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of the Plan's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedules of Assets Held
for Investment Purposes and Reportable Transactions are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by The
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. These supplemental
schedules have been subjected to the auditing procedures applied in the audits
of the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
PRICEWATERHOUSECOOPERS LLP
Los Angeles, CA
June 22, 1999
F-2
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(In thousands)
[CAPTION]
<TABLE>
<S> <C> <C>
December 31,
--------------------
1998 1997
--------- ---------
Assets
Investments:
At fair value
The Walt Disney Company Common Stock Fund $ 511,769 $ 535,542
Shares of registered investment companies:
Fidelity Retirement Money Market Portfolio Fund 136,875 170,672
Fidelity Inst. Short-Inter Gov't Portfolio Fund 18,311 17,098
Fidelity Asset Manager Fund 65,533 61,654
Fidelity Growth & Income Portfolio Fund 188,509 163,342
Fidelity Magellan Fund 110,396 83,236
Participant Loans 13,202 14,364
--------- ---------
Total investments 1,044,595 1,045,908
--------- ---------
Receivables:
Participants' contributions 6,021 139
Employer's contribution 857 882
--------- ---------
Total receivables 6,878 1,021
--------- ---------
Total assets 1,051,473 1,046,929
--------- ---------
Net assets available for benefits $1,051,473 $1,046,929
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-3
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(In thousands)
[CAPTION]
<TABLE>
<S> <C>
For the Year Ended
December 31,
1998
------------------
Additions to net assets attributed to:
Investment income:
Dividend and interest income $ 39,011
Interest on participant loans 1,151
Net realized gain on sale of assets 8,775
Net unrealized depreciation
on investments (14,170)
---------
34,767
---------
Contributions:
Participant's 34,757
Employer's 11,293
---------
46,050
---------
Total additions 80,817
---------
Deductions from net assets attributed to:
Benefits paid to participants 76,668
Administrative expense 90
Transfer of assets to successor trustee 557
---------
Total deductions 77,315
---------
Increase in net assets 3,502
Transfer of assets from the Fairchild Publications
Inc. Publishing Pension Plan (Note 1) 1,042
---------
Increase in net assets including transfer 4,544
---------
Net assets available for benefits:
Beginning of year 1,046,929
---------
End of year $1,051,473
=========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-4
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Tabular dollars in thousands)
1. Description of the Plan
General
The ABC, Inc. Savings & Investment Plan (the "Plan") is a defined contribution
plan designed to provide participating employees the opportunity to accumulate
retirement funds through a tax-deferred contribution arrangement pursuant to
Section 401(k) and after-tax contributions pursuant to Section 401(a) of the
Internal Revenue Code of 1986, as amended (the "Code"). In addition to the Code,
the Plan is subject to the provisions of the Employee Retirement Income Security
Act of 1974 ("ERISA"). For further information regarding the Plan, refer to the
Summary Plan Description and fund prospectus.
Administration of the Plan
On February 9, 1996, The Walt Disney Company acquired ABC, Inc. (the "Company")
(previously called "Capital Cities/ABC, Inc."). The Company appointed the
Employee Benefits Committee (the "Committee" or "Plan Administrator") to
administer the Plan, interpret its provisions and resolve all issues arising in
the administration of the Plan.
The assets of the Plan are administered under a trust agreement between the
Company and Fidelity Institutional Retirement Services Company ("Fidelity" or
the "Trustee"). Pursuant to the trust agreement, Fidelity executes most of the
day-to-day activities of administration.
Participation
Participation in the Plan is available to qualified employees of the Company and
those other subsidiaries and divisions of ABC, Inc. which were a part of, or
affiliates of the American Broadcasting Companies, Inc. ("ABC") (an indirect
wholly-owned subsidiary of ABC, Inc.) prior to January 1, 1989. Individuals who
became employees of the corporate and other broadcasting properties of ABC, Inc.
subsequent to 1988 also are eligible to participate in the Plan as are employees
of certain properties within the Company's Publishing Group not part of ABC,
Inc. prior to January 1, 1989.
Effective April 1, 1998, certain employees of the corporate and broadcasting
operations of the Company hired prior to January 1, 1989 who were previously
ineligible for the Plan and participating in The Employee Profit Sharing Plan of
ABC, Inc. are eligible to participate in the Plan.
Transfer of Assets
During 1997, the Company sold certain Publishing Group properties to various
purchasers. Employees of these Publishing Group properties who were participants
of the Plan were allowed to either transfer their vested account balances to
plans provided by the purchasers of the Publishing Group properties, withdraw
from the Plan by December 31, 1999, or leave their account balances in the Plan
subject to the Plan's distribution provisions regarding termination, retirement
or death. The disposition of Publishing Group participant account balances was
in accordance with the terms and conditions of each sale and may differ from
sale to sale. Total net assets transferred amounted to $74,573,859.
F-5
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Transfer of Assets (continued)
Effective May 19, 1998, $1,042,000 of employee after-tax contributions of
certain employees of Fairchild Publishing Inc. were transferred into the Plan
from the Fairchild Publishing Inc. Publishing Pension Plan.
Contributions
Participants are permitted to authorize contributions in whole percentages, up
to 10 percent of their base compensation on a pre-tax or after-tax basis,
through payroll deductions. A participant's total contributions and the
Company's matching contributions, in any Plan year, cannot exceed the limits
provided under Sections 401(k), 401(a) and 415 of the Code.
The Company currently contributes a matching amount equal to 50 percent of the
first 5 percent a participant contributes to the Plan. The Company may make
matching contributions either in cash, which is invested exclusively in the
common stock of The Walt Disney Company, or directly in shares of the common
stock of The Walt Disney Company and, at its discretion, the Company may change
the level of matching contributions or cease making matching contributions.
Participants may not transfer matched company contributions from The Walt Disney
Company Common Stock Fund. However, participants are allowed to transfer matched
contributions made prior to the merger of ABC, Inc. with The Walt Disney Company
into any fund of their choice.
Vesting
Participants are immediately 100 percent vested with respect to all
contributions made by the participant. Effective January 1, 1995, once the
participant completes five years of service, matching employer contributions are
immediately 100 percent vested. Prior to completion of the fifth year of
service, matching employer contributions vest 50 percent at the end of the Plan
year for which the contributions are made, and the remaining 50 percent at the
end of the subsequent Plan year. Additionally, a participant's account is
considered fully vested upon attaining age 65, or death while in active service,
or upon termination of service because of permanent and total disability.
Forfeitures
Nonvested employer contributions are forfeited upon termination and revert to
the Company. These amounts are used to reduce future employer contributions.
Investments
Participants may direct the investment of their contributions in any one or more
investment funds established for the Plan. Participants may elect to change the
investment of their contributions or to transfer all or part of their account
balances among the various investment funds. Such elections may be made as often
as once each month, in whole dollars or percentages.
F-6
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Investments (continued)
The trust agreement provides that assets of the Plan may be invested in the
following pooled investment funds (collectively, the "Investment Funds"),
established by Fidelity:
The Walt Disney Company Common Stock Fund
This fund consists primarily of The Walt Disney Company common stock and
cash and cash equivalents which are deemed necessary for orderly
investment in such stock and for anticipated cash requirements.
Fidelity Retirement Money Market Portfolio Fund
This fund invests in short-term money market instruments, such as bank
certificates of deposit, issued by both U.S. and foreign banks,
insurance companies and government agencies.
Fidelity Institutional Short-Intermediate Government Portfolio Fund
This fund invests only in fixed income securities issued by the U.S.
government or issued by U.S. government agencies.
Fidelity Asset Manager Fund
This fund consists of a neutral mix of stocks, bonds and short-term
investments of both U.S. and foreign governments.
Fidelity Growth & Income Portfolio Fund
This fund invests in stocks, bonds and short-term investments of U.S.
and foreign companies that offer growth potential while paying
dividends.
Fidelity Magellan Fund
This fund invests primarily in common stock and securities convertible
into common stock; however, up to 20 percent of the Fund may be invested
in fixed income securities. Additionally, the Fund may invest in foreign
securities, high-yield securities, and may buy and sell options and
futures contracts relating to securities in the Fund. The Walt Disney
Company common stock may be held in the Fund.
Brokerage commissions and stock transfer taxes in connection with the purchase
or sale of securities are absorbed within the net asset value of each investment
fund on each business day. All other costs and expenses incurred in connection
with the administration of the Plan will be charged to the participants'
accounts.
F-7
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Benefits, Distributions and Withdrawals
A participant's entire vested account balance, adjusted for investment gains or
losses, is available for immediate distribution upon termination of employment.
Effective January 1, 1998, participant account balances under $5,000 ($3,500
prior to January 1, 1998) are automatically distributed within 60 days following
the participant's severance date or as soon as possible, thereafter. All amounts
must be distributed when the terminated participant reaches age 65.
Under Section 401(k) of the Code, in service withdrawals of tax-deferred
contributions by participants are available only in amounts necessary to satisfy
a financial hardship and will be made if the Committee determines that the
reason for the hardship complies with applicable requirements under the Code.
Under Section 401(a) of the Code, in service withdrawals of the value of
after-tax contributions by participants can be made at any time, for any reason.
In compliance with the Code, active participants who have reached age 70 and
one-half must (unless exempt) take an annual minimum required distribution
commencing not later than April 1, of the year following the year they attain
age 70 and one-half.
Loans
Participants are permitted to borrow from their accounts subject to certain
limitations and conditions established to comply with the current requirements
of the Code. All loans made to participants are secured by their accounts with a
right of off-set. Participants may borrow up to 50 percent of their vested
account balance not to exceed $50,000 in any consecutive twelve month period.
A participant may only have one loan outstanding.
Loans may have a term of up to five years. The interest rate on loans is
currently Chase Manhattan Bank of New York's prime rate plus 1 percent.
Plan Amendment or Termination
The Company reserves the right to amend or modify, at any time, the provisions
of the Plan. Although the Company expects to continue the Plan indefinitely, the
Board of Directors of the Company may terminate the Plan for any reason. If the
Plan is terminated each participant will receive, as prescribed by ERISA and its
related regulations, and in the form and manner determined by the Committee, a
payment equal to the value of the participant's vested account at the time of
liquidation.
F-8
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
2. Summary of Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared using the accrual basis of
accounting.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying
disclosures. Actual results could differ from those estimates.
Contribution Policy
Contributions are recorded in the period during which the Company makes payroll
deductions from the employees' earnings. Matching company contributions are
recorded in the same period.
Investment Valuation and Income Recognition
Investments in securities traded on national security exchanges are valued on
the basis of the closing price on the last trading day of the year. Investments
in commingled funds are valued at the redemption prices established by the
Trustee, which are based on the market value of the fund assets. Participant
loans are valued at cost which approximates fair value. Purchases and sales of
securities are recorded on a trade-date basis. Interest income is recorded on
the accrual basis. Dividends are recorded on the ex-dividend date.
Realized Gains and Losses on Security Transactions
Realized gains and losses on security transactions are computed based upon the
sales proceeds less the fair value of the investments at the beginning of the
year or the acquisition cost, if acquired during the year.
Unrealized Appreciation/Depreciation in Fair Value of Investments
The unrealized appreciation or depreciation in the fair value of investments
held at year end is based on values established at the most recent year-end
valuation date as compared to the previous year-end valuation or the
purchase cost if the investment was acquired within the year.
Payment of Benefits
Benefits are recorded when paid.
F-9
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
3. Investments
All funds are maintained on a unit basis. Unit value is determined daily by
dividing the total assets of the fund by the total number of units allocated to
participants' accounts.
Investments held by the Plan are as follows:
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
December 31, 1998 December 31, 1997
---------------------------------- --------------------------------
Number Market Number Market
of Value Total of Value
Units Per Unit Market Units Per Unit Market
----------- ---------- ---------- ----------- -------- ----------
The Walt Disney Company
Common Stock Fund 36,738,632 $ 13.93 $ 511,769* 35,048,550 $15.28 $ 535,542*
--------- ---------
Fidelity Pooled Funds:
Retirement Money Market
Portfolio Fund 136,874,909 1.00 136,875* 170,672,420 1.00 170,672*
Inst. Short-Inter Gov't
Portfolio Fund 1,937,733 9.45 18,311 1,815,042 9.42 17,098
Asset Manager Fund 3,768,443 17.39 65,533* 3,359,919 18.35 61,654*
Growth & Income
Portfolio Fund 4,112,326 45.84 188,509* 4,287,183 38.10 163,342*
Magellan Fund 913,724 120.82 110,396* 873,684 95.27 83,236*
--------- ---------
519,624 496,002
--------- ---------
Participant Loans 13,202 14,364
--------- ---------
$1,044,595 $1,045,908
========= =========
</TABLE>
* Funds that constitute more than five percent of the investments held
F-10
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
4. Statement of Net Assets Available for Benefits by Investment Program
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
DECEMBER 31, 1998
--------------------------------------------------------------------------------------------
The Walt Retirement Inst.
Disney Money Short-Inter Growth &
Company Market Gov't Asset Income
Common Portfolio Portfolio Manager Portfolio Magellan Participant
Stock Fund Fund Fund Fund Fund Fund Loans Total
----------- -------- ---------- -------- --------- --------- ----------- ----------
Investments at
fair value $511,769 $136,875 $18,311 $65,533 $188,509 $110,396 $13,202 $1,044,595
Contributions
receivable 2,126 3,121 83 263 718 567 - 6,878
------- ------- ------ ------ ------- ------- ------ ---------
Net assets available
for benefits $513,895 $139,996 $18,394 $65,796 $189,227 $110,963 $13,202 $1,051,473
======== ======== ======= ======= ======== ======== ======= ==========
DECEMBER 31, 1997
-----------------------------------------------------------------------------------------------
The Walt Retirement Inst.
Disney Money Short-Inter Growth &
Company Market Gov't Asset Income
Common Portfolio Portfolio Manager Portfolio Magellan Participant
Stock Fund Fund Fund Fund Fund Fund Loans Total
---------- --------- --------- ------- --------- -------- ----------- ----------
Investments at
fair value $535,542 $170,672 $17,098 $61,654 $163,342 $83,236 $14,364 $1,045,908
Inter-fund transfer
receivable 2,000 (3,000) 50 200 450 300 - -
Contributions
receivable 328 161 25 112 224 171 - 1,021
------- ------- ------ ------ ------- ------ ------ ---------
Net assets available
for benefits $537,870 $167,833 $17,173 $61,966 $164,016 $83,707 $14,364 $1,046,929
======== ======== ======= ======= ======== ======= ======= ==========
</TABLE>
F-11
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
5. Statement of Changes in Net Assets Available for Benefits by Investment
Program
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
FOR THE YEAR ENDED DECEMBER 31, 1998
--------------------------------------------------------------------------------------------
The Walt Retirement Inst.
Disney Money Short-Inter Growth &
Company Market Gov't Asset Income
Common Portfolio Portfolio Manager Portfolio Magellan Participant
Stock Fund Fund Fund Fund Fund Fund Loans Total
---------- --------- ----------- ------- --------- -------- ----------- -------
Additions to net assets
attributed to:
Investment income
Interest an $ 3,378 $ 7,577 $ 1,105 $12,042 $ 9,890 $ 5,019 $ 1,151 $40,162
Net realized (loss)
/gain on sale of (662) - 64 401 6,291 2,681 - 8,775
------- ------- ------ ------ ------- ------- ------ -------
2,716 7,577 1,169 12,443 16,181 7,700 1,151 48,937
------- ------- ------ ------ ------- ------- ------ -------
Net unrealized
(depreciation)
appreciation
investments (57,317) - (21) (3,153) 26,771 19,550 - (14,170)
------- ------- ------ ------ ------ ------- ------ -------
Contributions:
Participants 13,393 4,382 887 2,906 7,424 5,765 - 34,757
Employer 11,010 291 - (3) (4) (1) - 11,293
------- ------- ------ ------ ------ ------- ------ -------
24,403 4,673 887 2,903 7,420 5,764 - 46,050
------- ------- ------ ------ ------ ------- ------ -------
Transfer of assets from the Fairchild Publications Inc.
Publishing - 1,042 - - - - - 1,042
------- ------- ------ ------ ------ ------- ------- -------
Total additions (30,198) 13,292 2,035 12,193 50,372 33,014 1,151 81,859
------- ------- ------ ------ ------ ------- ------- -------
Deductions from net assets attributed to:
Benefits paid
to participants 29,334 17,241 2,815 5,435 15,125 5,610 1,108 76,668
Administrative
expense 15 36 5 11 19 4 - 90
------- ------- ------ ------ ------- ------- ------- -------
29,349 17,277 2,820 5,446 15,144 5,614 1,108 76,758
------- ------- ------ ------ ------- ------- ------- -------
Transfer of assets
to successor
trustee 139 153 84 67 66 48 - 557
------- ------- ------ ------ ------- ------- ------- -------
Total deductions 29,488 17,430 2,904 5,513 15,210 5,662 1,108 77,315
------- ------- ------ ------ ------- ------- ------- -------
Inter-fund transfers 35,711 (23,699) 2,090 (2,850) (9,951) (96) (1,205) -
------- ------- ------ ------ ------- ------- ------- -------
(Decrease)/ increase
in net assets for
the year (23,975) (27,837) 1,221 3,830 25,211 27,256 (1,162) 4,544
Net assets available for benefits:
Beginning of year 537,870 167,833 17,173 61,966 164,016 83,707 14,364 1,046,929
------- ------- ------ ------ ------- ------- ------ ---------
End of year $513,895 $139,996 $18,394 $65,796 $189,227 $110,963 $13,202 $1,051,473
======== ======== ======= ======= ======== ======== ======= ==========
</TABLE>
F-12
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
6. Income Taxes
The Company received an Internal Revenue Service determination letter dated
March 28, 1996, stating that the Plan, as currently amended, qualifies under
Section 401(a) of the Code and is therefore exempt from Federal income tax under
Section 501(a) of the Code. Since the Plan is qualified under Section 401(a) of
the Code, under applicable state law it is also exempt from state income taxes.
The Plan Administrator and the Plan's tax counsel believe that the Plan is
designed and is currently being operated in compliance with the applicable
requirements of the Code. Accordingly, no provision for income taxes is made in
the accompanying financial statements.
7. Related Party Transactions
Certain Plan investments are shares of mutual funds managed by Fidelity.
Fidelity is the trustee as defined by the Plan, and, therefore, these
transactions qualify the Trustee as a party-in-interest. Fees paid by the Plan
to the Trustee amounted to $90,038 for the year ended December 31, 1998.
8. Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for benefits according
to the financial statements to Form 5500:
[CAPTION]
<TABLE>
<S> <C>
December 31,
1998
------------
Net assets available for benefits per the
financial statements $1,051,473
Amounts allocated to withdrawing participants (322)
---------
Net assets available for benefits per Form 5500 $1,051,151
=========
</TABLE>
F-13
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
8. Reconciliation of Financial Statements to Form 5500 (continued)
The following is a reconciliation of benefits paid to participants according to
the financial statements to Form 5500:
[CAPTION]
<TABLE>
<S> <C>
December 31,
1998
-------------
Benefits paid to participants per the
financial statements $76,668
Less: Amounts allocated to withdrawing participants
at December 31, 1997 (325)
Add: Amounts allocated to withdrawing participants
at December 31, 1998 322
-------
Benefits paid to participants per Form 5500 $76,665
=======
</TABLE>
Amounts allocated to withdrawing participants are recorded on Form 5500 for
benefit claims that have been processed and approved for payment prior to
December 31 but not yet paid as of that date.
9. Investment in Master Trust
The Plan's investments are held in a Master Trust along with the assets of the
Employee Profit Sharing Plan of ABC, Inc., a defined contribution plan sponsored
by the Company. Each participating plan has a specific interest in the Master
Trust. Assets of the Master Trust are allocated to the participating plans
according to the elections of participants within each plan. At December 31,
1998 and 1997, the Plan's interest in the net assets of the Master Trust was
approximately 80.5% and 84.7%, respectively. Investment income of the Master
Trust is allocated based upon each Plan's interest within each of the investment
funds held by the Master Trust.
Investments held by the Master Trust are as follows:
[CAPTION]
<TABLE>
<S> <C> <C>
December 31,
-----------------------------
1998 1997
------------- --------------
Investments, at fair value:
The Walt Disney Company Common Stock Fund $ 511,769 $ 535,542
Shares of registered investment companies 785,386 698,796
------------- ------------
Total $ 1,297,155 $ 1,234,338
============= ============
</TABLE>
F-14
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
9. Investment in Master Trust (continued)
The investment income of the Master Trust is as follows:
[CAPTION]
<TABLE>
<S> <C>
For the Year Ended
December 31, 1998
----------------------
Investment Income:
Interest and dividends $52,988
Net realized gain on sale of assets 14,915
Net unrealized appreciation 23,655
------
Total $91,558
=======
</TABLE>
The net (depreciation)/appreciation (including net realized gains/losses) in the
fair value of the investments held by the Master Trust is as follows:
[CAPTION]
<TABLE>
<S> <C>
For the Year Ended
December 31, 1998
----------------------
Net (Depreciation)/Appreciation:
The Walt Disney Company Common Stock Fund $(57,979)
Shares of registered investment companies 96,549
------
Total $ 38,570
========
</TABLE>
F-15
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
SCHEDULE I
LINE 27a: SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT
DECEMBER 31, 1998
(DOLLARS ARE NOT IN THOUSANDS)
[CAPTION]
<TABLE>
<S> <C> <C>
CURRENT
DESCRIPTION OF INVESTMENTS COST VALUE
-------------------------- ------------ ---------------
*The Walt Disney Company $333,556,644 $ 511,769,145
Common Stock Fund
*Fidelity Retirement Money Market 136,875,082 136,875,082
Portfolio Fund
*Fidelity Inst. Short-Inter 18,236,798 18,311,575
Gov't Portfolio Fund
*Fidelity Asset Manager Fund 61,640,772 65,533,220
*Fidelity Growth & Income
Portfolio Fund 130,239,395 188,509,010
*Fidelity Magellan Fund 78,082,565 110,396,168
Participant Loans 0 13,201,714
(Maturities go through 2004
Interest rates range from
7.0% to 11.0%) ----------- -------------
$758,631,256 $1,044,595,914
=========== ==============
*Parties-in-interest
</TABLE>
F-16
<PAGE>
ABC, INC. SAVINGS & INVESTMENT PLAN
SCHEDULE II
LINE 27d: SCHEDULE OF REPORTABLE TRANSACTIONS**
FOR THE YEAR ENDED DECEMBER 31, 1998
(DOLLARS ARE NOT IN THOUSANDS)
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Current
Identity Selling/ Cost of value of asset
of party Number of Purchase distribu- Lease Expense assets sold/ on transaction Net
involved Description of assets Transactions Price tion Price rental incurred distributed date gain
- ----------- --------------------- ----------- -------- ---------- ------ -------- ----------- ------------- ----------
The Walt The Walt Disney Company
Disney Company* Common Stock 252 $143,049,404
252 $108,840,904 $84,532,322 $24,308,582
Fidelity * Growth & Income
Portfolio Fund 252 64,913,539
251 72,806,572 60,895,470 11,911,102
Fidelity * Retirement Money Market
Portfolio Fund 256 88,822,064
251 122,619,402 122,619,402 -
</TABLE>
* Parties-in-interest
**Transactions or series of transactions in excess of 5 percent of
the current value of the Plan's assets as of December 31, 1998 as
defined in 29 CFR 2520.103-6 of the Department of Labor Rules and
Regulations for Reporting and Disclosure under ERISA.
F-17
<PAGE>
DISNEY SALARIED SAVINGS AND
INVESTMENT PLAN
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998 AND 1997
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998
Report of Independent Accountants F-2
Statements of Net Assets Available for Benefits F-3
Statement of Changes in Net Assets Available for Benefits F-4
Notes to Financial Statements F-5
Supplemental Schedules
Schedule I - Line 27a: Schedule of Assets Held for
Investment Purposes F-13
Schedule II - Line 27b: Schedule of Loans or Fixed Income
Obligations F-14
Schedule III - Line 27d: Schedule of Reportable Transactions F-15
Other schedules required by Section 2520.103-10 of the Department of Labor Rules
and Regulations for Reporting and Disclosure under ERISA have been omitted
because they were not applicable.
F-1
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
June 8, 1999
To the Participants and Investment and
Administrative Committee for
the Disney Salaried Savings and Investment Plan
In our opinion, the accompanying statements of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of the Disney Salaried Savings and Investment Plan (the "Plan") at December 31,
1998 and 1997 and the changes in its net assets available for benefits for the
year ended December 31, 1998, in conformity with generally accepted accounting
principles. These financial statements are the responsibility of the Plan's
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for the opinion expressed
above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental Schedules of Assets Held
for Investment Purposes, Loans or Fixed Income Obligations and Reportable
Transactions are presented for the purpose of additional analysis and are not a
required part of the basic financial statements but are supplementary
information required by The Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. These supplemental schedules have been subjected to the auditing
procedures applied in the audits of the basic financial statements and, in our
opinion, are fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
PRICEWATERHOUSECOOPERS LLP
Los Angeles, California
June 8, 1999
F-2
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
(In thousands)
[CAPTION]
<TABLE>
<S> <C> <C>
December 31,
--------------------
1998 1997
-------- ----------
Assets
Investments
At fair value:
The Walt Disney Company Common Stock Fund $383,655 $393,837
Shares of registered investment companies:
Fidelity Inst. Short-Int. Govt Portfolio Fund 34,761 31,906
Fidelity Magellan Fund 115,352 87,003
PIMCO Total Return Fund 11,946 8,590
Fidelity Growth & Income Fund 102,549 75,722
Sequoia Fund 36,665 13,075
Fidelity Diversified International Fund 6,658 4,278
Putnam New Opportunities Fund 11,031 4,809
Participant Loans 15,034 12,936
------ ------
Total investments 717,651 632,156
------- -------
Receivables:
Participants' contributions 1,215 1,790
Employer's contribution 280 501
Interest income 26 42
------ -------
Total receivables 1,521 2,333
------ -------
Total assets 719,172 634,489
------- -------
Net assets available for benefits $719,172 $634,489
======== ========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-3
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
(In thousands)
[CAPTION]
<TABLE>
<S> <C>
For the Year Ended
December 31,
1998
------------------
Additions to net assets attributed to:
Investment income:
Interest $ 1,216
Dividends 18,529
Net realized gain on sale of assets 3,886
-------
23,631
-------
Net unrealized appreciation
in fair value of investments 5,724
-------
Contributions:
Participants' 69,327
Employer's 15,513
------
84,840
------
Total additions 114,195
-------
Deductions from net assets attributed to:
Benefits paid to participants 29,466
Administrative expense 46
------
Total deductions 29,512
------
Increase in net assets 84,683
Net assets available for benefits:
Beginning of year 634,489
-------
End of year $719,172
========
</TABLE>
The accompanying notes are an integral part of these financial statements.
F-4
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(Tabular dollars in thousands)
1. Description of the Plan
General
The Walt Disney Company (the "Company") implemented the Disney Salaried Savings
and Investment Plan (the "Plan") on January 1, 1985. The Plan is a defined
contribution plan designed to provide participating employees the opportunity to
accumulate retirement funds through a tax-deferred contribution arrangement
pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended (the
"Code"). In addition to the Code, the Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA"). For further
information regarding the Plan, refer to the Summary Plan Description.
Administration of the Plan
The Board of Directors of the Company has appointed the Investment and
Administrative Committee of The Walt Disney Company Sponsored Qualified Benefit
Plans and Key Employees Deferred Compensation and Retirement Plan (the
"Committee" or "Plan Administrator") to administer the Plan, interpret its
provisions and resolve all issues arising in the administration of the Plan.
The assets of the Plan are administered under a trust agreement between the
Company and Fidelity Institutional Retirement Services Company ("Fidelity" or
the "Trustee"). Pursuant to the trust agreement, Fidelity executes most of the
day-to-day activities of administration.
Administrative expenses of the Plan, such as benefit plan consultation fees
(exclusive of brokerage commissions on the purchase or sale of Company stock)
may be paid from the assets of the Plan unless the Company, at its discretion,
pays such expenses. Investment expenses incurred by the investment funds are
charged to the respective funds.
Participation
Participation in the Plan is available to all domestic salaried employees of the
Company and its subsidiaries participating in the Plan who are regularly
scheduled to work 1,000 hours or more during a year. To be eligible, employees
must be age 18 or older and have completed one year of employment during which
they must also work at least 1,000 hours.
The Plan accepts direct cash rollovers from other qualified plans regardless of
whether the employee has met the one-year eligibility requirement. However, such
funds are not available for hardship distributions or loans until after the
employee has met the one-year eligibility requirement and has become a
participant of the Plan.
F-5
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Contributions
Participants are permitted to authorize income deferrals in whole percentages,
up to 15 percent of their base compensation on a pre-tax basis, through weekly
payroll deductions. Prior to January 1, 1998, participants were permitted to
defer income, in whole percentages, up to 10 percent of their base compensation
on a pre-tax basis, through weekly payroll deductions. A participant's total
tax-deferred contributions and the Company's matching contributions, in any Plan
year, cannot exceed the limits provided under Section 415 of the Code.
Effective January 1, 1987, the Plan ceased to accept voluntary post-tax
contributions. Post-tax contributions made prior to January 1, 1987 may remain
in the Plan and continue to share in the Plan's investment results on a
tax-deferred basis. Income earned on voluntary contributions is not taxable for
Federal income tax purposes until withdrawal and such post-tax contributions are
recovered tax free when withdrawn or distributed.
The Company currently contributes a matching amount equal to 50 percent of a
participant's pre-tax contributions up to a maximum of 2 percent of such
participant's base compensation. The Company may make matching contributions
either in cash, which is invested exclusively in the Company's common stock, or
directly in shares of the Company's common stock and, at its discretion, the
Company may change the level of matching contributions or cease making matching
contributions.
Participants are fully vested immediately in all contributions including the
Company's matching contributions made to the Plan and all earnings thereon.
Investments
Participants may direct the investment of their contributions in any one or more
investment funds established for the Plan. Participants may elect to change the
investment of their contributions or to transfer all or part of their account
balances among the various investment funds. Such elections must be made in 1
percent increments.
Effective April 1, 1997, three funds were eliminated from the Plan and five new
funds were added to the Plan. Additionally, the valuation of The Walt Disney
Company Stock Fund was changed from a share basis valuation to a unit basis
valuation. Participants with an interest in the funds which were eliminated were
allowed to transfer their balances to one of the remaining funds by March 19,
1997 or to allow their balances to be mapped automatically to the new investment
funds. As of March 20, 1997, participants with an interest in Fidelity U.S. Bond
Index Fund had their interest transferred to the PIMCO Total Return Fund.
Participant balances in the Fidelity Balanced Fund were mapped to the Fidelity
Growth & Income Fund, while participant balances in the Fidelity U.S. Equity
Index Commingled Fund were mapped to the Fidelity Growth & Income Fund.
F-6
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Investments (continued)
The trust agreement provides that assets of the Plan may be invested in the
following pooled investment funds (collectively, the "Investment Funds"):
The Walt Disney Company Common Stock Fund
This fund consists primarily of The Walt Disney Company common stock and
cash and cash equivalents which are deemed necessary for orderly
investment in such stock and for anticipated cash requirements.
Fidelity Institutional Short-Intermediate Government Portfolio Fund
This fund invests only in fixed income securities issued by the U.S.
government or issued by U.S. government agencies.
Fidelity Magellan Fund
This fund invests primarily in common stock and securities convertible
into common stock; however, up to 20 percent of the Fund may be invested
in fixed income securities. Additionally, the Fund may invest in foreign
securities, high-yield securities, and may buy and sell options and
futures contracts relating to securities in the Fund. The Walt Disney
Company common stock may be held in the Fund.
PIMCO Total Return Fund
This fund invests primarily in a diversified portfolio of fixed income
securities of varying maturities, averaging within a three to six year
time frame. The Fund may invest up to 10 percent of its assets in fixed
income securities rated below investment grade but rated B or higher by
Moody's or S&P. Additionally, the Fund may also invest up to 20 percent
of its assets in securities denominated in foreign currencies, and may
invest beyond this limit in U.S. dollar-denominated securities of
foreign issuers.
Fidelity Growth & Income Portfolio Fund
This fund invests in stocks, bonds and short-term investments of U.S.
and foreign companies that offer growth potential while paying
dividends.
Sequoia Fund
This fund invests primarily in common stock and securities convertible
into or exchangeable for common stock. Additionally, the Fund may
invest, on a limited basis, in foreign securities, restricted securities
and special situations.
Fidelity Diversified International Fund
This fund invests in a diversified portfolio of equity securities of
companies located outside of the United States. Up to 35 percent of the
fund may be invested in high-yield securities (commonly referred to as
"junk bonds") and up to 15 percent may be invested in securities not
readily converted to cash.
F-7
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Investments (continued)
Putnam New Opportunities Fund
This fund invests in common stocks of companies in sectors of the
economy believed to possess above-average long-term growth. The Fund may
also invest in convertible bonds, convertible preferred stocks,
preferred stocks, warrants and debt securities.
Benefits, Distributions and Withdrawals
A participant's entire account balance, adjusted for investment gains or losses,
is available for immediate distribution upon termination of employment.
Effective January 1, 1998, participants' account balances under $5,000 ($3,500
prior to January 1, 1998) are automatically distributed within 90 days following
the participant's severance date. The participant has 60 days following the
participant's severance date to elect whether or not to rollover the funds into
an IRA or another qualified plan. If no election is made, the funds will be
dispersed to the participant less 20 percent for federal withholding tax.
Participants with account balances of $5,000 or more may elect a distribution at
anytime following termination, before age 65. All amounts must be distributed
when the participant reaches age 65.
Under Section 401(k) of the Code, in service withdrawals of tax-deferred
contributions by participants are available only in amounts necessary to satisfy
a financial hardship and will be made if the Committee determines that the
reason for the hardship complies with applicable requirements under the Code. A
participant may withdraw his or her post-tax contributions twice each Plan year.
The minimum amount of each post-tax contribution withdrawal is $500.
Loans
Participants are permitted to borrow from their accounts subject to certain
limitations and conditions established to comply with the current requirements
of the Code. All loans made to participants are secured by their accounts with a
right of off-set. Voluntary post-tax contributions and any earnings thereon are
not available for loans. Participants may borrow up to 50 percent of their
account balance not to exceed $50,000 in any consecutive twelve month period.
A participant may only have one loan outstanding.
Loans may have a term of up to four years. However, the term can be extended to
ten years if the loan is used to acquire or construct a principal residence of
the participant. The interest rate on loans is currently prime plus 1 percent.
F-8
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
1. Description of the Plan (continued)
Plan Amendment or Termination
The Company reserves the right to amend or modify, at any time, the provisions
of the Plan. Although the Company expects to continue the Plan indefinitely, the
Board of Directors of the Company may terminate the Plan for any reason. If the
Plan is terminated each participant will receive, as prescribed by ERISA and its
related regulations, and in the form and manner determined by the Committee, a
payment equal to the value of the participant's account at the time of
liquidation.
2. Summary of Significant Accounting Policies
Basis of Accounting
The financial statements of the Plan are prepared using the accrual basis of
accounting.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the amounts reported in the financial statements and accompanying
disclosures. Actual results could differ from those estimates.
Contribution Policy
Contributions are recorded in the period during which the Company makes payroll
deductions from the employees' earnings. Matching company contributions are
recorded in the same period.
Investment Valuation and Income Recognition
Investments in securities traded on national security exchanges are valued on
the basis of the closing price on the last trading day of the year. Investments
in commingled funds are valued at the redemption prices established by the
Trustee, which are based on the market value of the fund assets. Participant
loans are valued at cost which approximates fair value. Purchases and sales of
securities are recorded on a trade-date basis. Interest income is recorded on
the accrual basis. Dividends are recorded on the ex-dividend date.
Realized Gains and Losses on Security Transactions
Realized gains and losses on security transactions are computed based upon the
sales proceeds less the fair value of the investments at the beginning of the
year or the acquisition cost, if acquired during the year.
F-9
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
2. Summary of Significant Accounting Policies (continued)
Unrealized Appreciation/Depreciation in Fair Value of Investments
The unrealized appreciation or depreciation in the fair value of investments
held at year end is based on values established at the most recent year-end
valuation date as compared to the previous year-end valuation or the
acquisition cost, if the investment was acquired within the year.
Payment of Benefits
Benefits are recorded when paid.
F-10
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
3.Summary of Changes in Net Assets Available for Benefits by Investment Program
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
For The Year Ended December 31, 1998
----------------------------------------------------------------------------------------
Fidelity
The Walt Inst.
Disney Short-Inter PIMCO Fidelity Fidelity Putnam
Company Gov't Fidelity Total Growth & Diversified New
Common Stock Portfolio Magellan Return Income Sequoia Int'l Opportunity Loan
Fund Fund Fund Fund Fund Fund Fund Fund Fund Total
------------ --------- -------- ------ -------- ------- ----------- ----------- ------ ---------
Additions to net
assets attributed to:
Investment income:
Interest $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 1,216 $ 1,216
Dividends 2,451 2,097 5,281 1,025 5,313 1,778 248 336 0 18,529
Net realized gain
on sale of assets 309 33 1,285 31 1,023 884 172 149 0 3,886
------ ------- ------- ------ ------ ------ -------- ------- ------ -------
2,760 2,130 6,566 1,056 6,336 2,662 420 485 1,216 23,631
------- ------- ------- ------ ------ ------ -------- ------- ------ -------
Net unrealized appre-
ciation (depreciation)
in fair value of
investments (38,397) 58 22,193 (144) 15,749 4,654 239 1,372 0 5,724
Contributions:
Participants 26,521 3,035 11,975 2,282 12,265 7,142 2,246 3,861 0 69,327
Employer 15,513 0 0 0 0 0 0 0 0 15,513
------- ------- ------ ----- ------ ------ -------- ------ ------ -------
42,034 3,035 11,975 2,282 12,265 7,142 2,246 3,861 0 84,840
------- ------- ------ ----- ------ ------ -------- ------ ------ -------
Total additions 6,397 5,223 40,734 3,194 34,350 14,458 2,905 5,718 1,216 114,195
------- ------- ------ ----- ------ ------ -------- ------ ------ --------
Deductions from net assets attributed to:
Benefits paid
to participants 16,363 2,061 4,162 494 3,734 975 310 643 724 29,466
Administrative
expense 11 10 7 4 13 1 0 0 0 46
------- ------- ------ ----- ------ ------ -------- ------ ------ --------
Total deductions 16,374 2,071 4,169 498 3,747 976 310 643 724 29,512
------- ------- ------ ----- ------ ------ -------- ------ ------ --------
Inter-fund transfers (689) (333) (8,339) 631 (3,916) 10,147 (234) 1,143 1,590 0
------- ------- ------ ----- ------ ------ -------- ------ ------ --------
Increase (decrease)
in net assets (10,666) 2,819 28,226 3,327 26,687 23,629 2,361 6,218 2,082 84,683
Net assets available for benefits:
Beginning of year 395,042 31,995 87,358 8,656 76,050 13,187 4,332 4,891 12,978 634,489
------- ------ ------- ------ ------- ------ ----- ------ ------ -------
End of year $384,376 $34,814 $115,584 $11,983 $102,737 $36,816 $6,693 $11,109 $15,060 $719,172
</TABLE>
F-11
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
4. Income Taxes
The Company has received an Internal Revenue Service determination letter dated
June 18, 1996 stating that the Plan qualifies under Section 401(a) of the Code
and is therefore exempt from Federal income tax under Section 501(a) of the
Code. Since the Plan is qualified under Section 401(a) of the Code, under
applicable state law it is also exempt from state income taxes. The Plan
Administrator and the Plan's tax counsel believe that the Plan is designed and
is currently being operated in compliance with the applicable requirements of
the Code. Accordingly, no provision for income taxes is made in the accompanying
financial statements.
5. Related Party Transactions
Certain Plan investments are shares of mutual funds managed by Fidelity.
Fidelity is the trustee as defined by the Plan, and, therefore, these
transactions qualify the Trustee as a party-in-interest. Fees paid by the Plan
to the Trustee amounted to $46,363 for the year ended December 31, 1998.
6. Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for benefits according
to the financial statements to Form 5500:
[CAPTION]
<TABLE>
<S> <C> <C>
December 31,
----------------------------
1998 1997
------------- -------------
Net assets available for benefits per the
financial statements $719,172 $634,489
Amounts allocated to withdrawing
participants (440) (909)
------- -------
Net assets available for benefits per
Form 5500 $718,732 $633,580
======== ========
</TABLE>
The following is a reconciliation of benefits paid to participants according to
the financial statements to Form 5500:
[CAPTION]
<TABLE>
<S> <C>
Year Ended
December 31,
1998
--------------
Benefits paid to participants per the
financial statements $29,466
Add: Amounts allocated to withdrawing participants
at December 31, 1998 440
Less: Amounts allocated to withdrawing participants
at December 31, 1997 (909)
------
Benefits paid to participants per Form 5500 $28,997
=======
</TABLE>
Amounts allocated to withdrawing participants are recorded on Form 5500 for
benefit claims that have been processed and approved for payment prior to
December 31, but not yet paid as of that date.
F-12
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
SCHEDULE I
LINE 27a: SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT
DECEMBER 31, 1998
(DOLLARS ARE NOT IN THOUSANDS)
[CAPTION]
<TABLE>
<S> <C> <C>
CURRENT
DESCRIPTION OF INVESTMENTS COST VALUE
-------------------------- ------------- -------------
*The Walt Disney Company $ 202,213,969 $ 383,654,337
Common Stock Fund
*Fidelity Inst. Short-Inter 35,208,145 34,761,343
Gov't Portfolio Fund
*Fidelity Magellan Fund 77,075,290 115,351,990
PIMCO Total Return Fund 11,937,861 11,946,621
*Fidelity Growth & Income Fund 74,335,535 102,548,402
Sequoia Fund 30,133,725 36,664,925
*Fidelity Diversified 6,440,092 6,658,138
International Fund
Putnam New Opportunities Fund 9,156,450 11,031,475
Participant Loans
(Maturities go through 2008
Interest rates range from
7.00% to 10.00%) 0 15,034,363
----------- ------------
$ 446,501,067 $ 717,651,594
============= =============
</TABLE>
*Parties-in-interest
F-13
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
SCHEDULE II
LINE 27b: SCHEDULE OF LOANS OR FIXED INCOME OBLIGATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
(DOLLARS ARE NOT IN THOUSANDS)
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Original Amount received Unpaid Detailed
amount during reporting year balance at description of Amount overdue
Identity and address --------------------- ------------------------
of obligor of loan Principal Interest end of year loan Principal Interest
- -------------------- -------- --------- -------- ----------- ------------------ ---------- ---------
Thomas Puckett Jr. $ 6,000 $ 989 $ 364 $4,602 Loan Dated 08/1 $ 395 $ 125
303 Duncan Court Maturity 09/05/2001
Orlando, Florida 32835 9.5% Interest
$34.70 payment
Phillip Gier 17,000 3,323 1,101 11,676 Loan Dated 06/05 693 192
2317 Cilantro Drive Maturity 05/24/2001
Orlando, Florida 32837 9.5% Interest
$98.32 payment
</TABLE>
F-14
<PAGE>
DISNEY SALARIED SAVINGS AND INVESTMENT PLAN
SCHEDULE III
LINE 27d: SCHEDULE OF REPORTABLE TRANSACTIONS**
FOR THE YEAR ENDED DECEMBER 31, 1998
(DOLLARS ARE NOT IN THOUSANDS)
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Current
Identity Selling/ Cost of value of asset
of party Number of Purchase distribution Lease Expense assets sold/ on transaction Net
involved Description of Assets Transactions Price Price rental incurred distributed date gain
- -------------- -------------------- ------------ -------- ------------ ------ -------- ------------ -------------- --------
The Walt The Walt Disney Company
Disney Company* Common Stock Fun 250 $62,614,033
230 $34,710,058 $20,092,344 $14,617,714
</TABLE>
* Parties-in-interest
**Transactions or series of transactions in excess of 5 percent of
the current value of the Plan's assets as of December 31, 1998 as
defined in 29 CFR 2520.103-6 of the Department of Labor Rules and
Regulations for Reporting and Disclosure under ERISA.
F-15
