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Exhibit 10(b)
AMENDMENT TO THE
WALT DISNEY COMPANY STOCK INCENTIVE PLANS
This is an amendment to (i) the Amended and Restated 1995 Stock Incentive
Plan of The Walt Disney Company (the "Corporation"), (ii) the 1990 Stock
Incentive Plan of the Corporation, (iii) the 1987 Stock Incentive Plan of the
Corporation and (iv) the 1984 Stock Incentive Plan of the Corporation
(collectively, the "Plans"). This amendment adds a new Section 11 to each Plan
that reads as follows, and any existing Section 11 shall be renumbered as
Section 12, and all succeeding sections shall be renumbered accordingly:
"11. Change In Control
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"(a) Accelerated Vesting. Except to the extent an award agreement
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provides for a different result (in which case the award agreement will
govern and this Section 11 of the Plan shall not be applicable),
notwithstanding anything elsewhere in the Plan or any rules adopted by the
Committee pursuant to the Plan to the contrary, if a Triggering Event shall
occur within the 12-month period beginning with a Change in Control of
Disney, then, effective immediately prior to such Triggering Event, (i)
each outstanding stock option, warrant and stock appreciation right, to the
extent that it shall not otherwise have become vested and exercisable,
shall automatically become immediately and fully vested and exercisable,
(ii) each outstanding award of restricted stock shall become immediately
and fully vested and all transfer restrictions under the terms of the award
shall lapse and (iii) each outstanding award of phantom stock, performance
shares or similar award shall become immediately and fully vested, all
performance or other conditions related to the payment of or rights under
the award shall lapse, and the award shall be immediately paid in the form
specified in the award agreement.
"(b) Definitions. For purposes of this Section 11, the following
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terms shall have the meanings set forth below.
"(1) Change in Control. For purposes hereof, a "Change in
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Control" of Disney shall mean:
"(i) the occurrence of (A) an acquisition by any
individual, entity or group (within the meaning of section
13(d)(3) or 14(d)(2) of the Exchange Act (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of a percentage of the
combined voting power of the then outstanding voting securities
of Disney entitled to vote generally in the election of directors
(the "Disney Voting Securities") (but
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excluding (1) any acquisition directly from Disney (other than an
acquisition by virtue of the exercise of a conversion privilege
of a security that was not acquired directly from Disney), (2)
any acquisition by Disney or an Affiliate and (3) any acquisition
by an employee benefit plan (or related trust) sponsored or
maintained by Disney or any Affiliate) (an "Acquisition") that is
thirty percent (30%) or more of the Disney Voting Securities; and
(B) the termination of employment, within six (6) months
following the Acquisition, of the individual who is the Chief
Executive Officer of Disney immediately prior to the Acquisition,
for any reason other than death, permanent and total disability,
Cause, or voluntary resignation (but excluding any termination
for "good reason" under any employment agreement and any
resignation that was requested by the Board or any such Person
(or its employees or representatives) that completes an
Acquisition);
"(ii) at any time during a period of two (2) consecutive
years or less, individuals who at the beginning of such period
constitute the Board (and any new directors whose election by the
Board or nomination for election by Disney's stockholders was
approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors at the beginning
of the period or whose election or nomination for election was so
approved) cease for any reason (except for death, disability or
voluntary retirement) to constitute a majority thereof;
"(iii) an Acquisition that is fifty percent (50%) or more
of the Disney Voting Securities;
"(iv) the consummation of a merger, consolidation,
reorganization or similar corporate transaction, whether or not
Disney is the surviving company in such transaction, other than a
merger, consolidation, or reorganization that would result in the
Persons who are beneficial owners of the Disney Voting Securities
outstanding immediately prior thereto continuing to beneficially
own, directly or indirectly, in substantially the same
proportions, at least fifty percent (50%) of the combined voting
power of the Disney Voting Securities (or the voting securities
of the surviving entity) outstanding immediately after such
merger, consolidation or reorganization;
"(v) the sale or other disposition of all or
substantially all of the assets of Disney;
"(vi) the approval by the stockholders of Disney of a
complete liquidation or dissolution of Disney; or
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"(vii) the occurrence of any transaction or event, or
series of transactions or events, designated by the Board in a
duly adopted resolution as representing a change in the effective
control of the business and affairs of Disney, effective as of
the date specified in any such resolution.
"(2) Triggering Event. For purposes hereof, the term
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"Triggering Event" shall mean (i) the termination of employment of a
participant by Disney or an Affiliate (or any successor thereof) other
than on account of death, permanent and total disability or Cause (ii)
the occurrence of a Constructive Termination, or (iii) any failure by
Disney (or a successor entity) to assume, replace, convert or
otherwise continue any award in connection with the Change in Control
(or another corporate transaction or other change effecting the Common
Stock) on the same terms and conditions as applied immediately prior
to such transaction, except for equitable adjustments to reflect the
changes in the Common Stock pursuant to Section 8 hereof.
"(3) Cause. For purposes hereof, the term "Cause" shall mean a
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determination by the Committee that a participant (i) has been
convicted of, or entered a plea of nolo contendere to, a crime that
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constitutes a felony under federal or state law, (ii) has engaged in
willful gross misconduct in the performance of his or her duties to
Disney or an Affiliate or (iii) has committed a material breach of any
written agreement with Disney or any Affiliate with respect to
confidentiality, noncompetition, nonsolicitation or similar
restrictive covenant. Subject to the first sentence of this Section
(a), above, in the event that a participant is a party to an
employment agreement with Disney or any Affiliate that defines a
termination on account of "Cause" (or a term having similar meaning),
such definition shall apply as the definition of a termination on
account of "Cause" for purposes hereof, but only to the extent that
such definition provides the participant with greater rights. A
termination on account of Cause shall be communicated by written
notice to the participant, and shall be deemed to occur on the date
such notice is delivered to the participant.
"(4) Constructive Termination. For purposes hereof, the term
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"Constructive Termination" shall mean a termination of employment by a
participant within 60 days following the occurrence of any one or more
of the following events without the participant's written consent (i)
any reduction in position, title (for Vice Presidents or above),
overall responsibilities, level of authority, level of reporting (for
Vice Presidents or above), base compensation, annual incentive
compensation opportunity, aggregate employee benefits, or a request
that the participant's location of employment be relocated by more
than fifty (50) miles. Subject to the first sentence of this Section
(a), above, in the event that a participant is a party to an
employment agreement with Disney or any Affiliate (or a successor
entity) that defines a termination on account of "Constructive
Termination",
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"Good Reason", "Breach of Agreement" (or a term having a similar
meaning), such definition shall apply as the definition of
"Constructive Termination" for purposes hereof in lieu of the
foregoing, but only to the extent that such definition provides the
participant with greater rights. A Constructive Termination shall be
communicated by written notice to the Committee, and shall be deemed
to occur on the date such notice is delivered to the Committee, unless
the circumstances giving rise to the Constructive Termination are
cured within five (5) days of such notice.
"(c) Excise Tax Limit. In the event that the vesting of the Awards
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together with all other payments and the value of any benefit received or
to be received by the participant would result in all or a portion of such
payment being subject to excise tax under Section 4999 of the Code, then
the participant's payment shall be either (A) the full payment or (B) such
lesser amount that would result in no portion of the payment being subject
to excise tax under Section 4999 of the Code (the "Excise Tax"), whichever
of the foregoing amounts, taking into account the applicable Federal,
state, and local employment taxes, income taxes, and the Excise Tax,
results in the receipt by the participant, on an after-tax basis, of the
greatest amount of the payment notwithstanding that all or some portion of
the payment may be taxable under Section 4999 of the Code. All
determinations required to be made under this Section 11 shall be made by
PricewaterhouseCoopers or any other nationally recognized accounting firm
which is Disney's outside auditor immediately prior to the event triggering
the payments that are subject to the Excise Tax (the "Accounting Firm").
Disney shall cause the Accounting Firm to provide detailed supporting
calculations of its determinations to Disney and participant. All fees and
expenses of the Accounting Firm shall be borne solely by Disney. The
Accounting Firm's determinations must be made with substantial authority
(within the meaning of Section 6662 of the Code). With respect to awards
outstanding on June 26, 2000, for the purposes of all calculations under
Section 280G of the Code and the application of this Section 11, all
determinations as to present value shall be made using 120 percent of the
applicable Federal rate (determined under Section 1274(d) of the Code)
compounded semiannually, as in effect on June 26, 2000."
IN WITNESS WHEREOF, this Amendment has been duly executed on behalf
of the Corporation and is adopted and is effective as of this 26th day of June
2000.
THE WALT DISNEY COMPANY
By /s/ Marsha Reed
Vice President and Secretary
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