Activision Blizzard (ATVI)

Amendment to 2003 Incentive Plan

On July 26, 2005, upon the recommendation of our management and the Compensation Committee, our Board approved amendments to our 2003 Incentive Plan (the “2003 Plan”) to conform the provisions of the 2003 Plan to Section 409A of the Internal Revenue Code of 1986 (the “Code”), added by the American Jobs Creation Act of 2004, which imposes additional taxes and interest charges on certain deferred compensation unless the compensation meets stringent new requirements.  The amendments to the 2003 Plan include the following:

•                                          Elimination of the ability to issue reload options and deferred share awards;

•                                          Revision of the definition of “fair market value” for purposes of determining the exercise price of options and the grant price of share appreciation rights;

•                                          Additional limitations to the terms and conditions under which share appreciation rights may be issued, including adding a requirement that share appreciation rights may only be payable in shares of stock;

•                                          Additional limitations on delivery time for restricted shares once they have fully vested; and

•                                          Increased flexibility to amend the 2003 Plan to make further changes to conform it to future interpretations of Section 409A of the Code.

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