Agreement and Plan of Merger between The Walt Disney Company and Pixar

ARTICLE I DEFINITIONS

ARTICLE II THE MERGER

Section 2.1

The Merger

Section 2.2

Closing

Section 2.3

Effective Time

Section 2.4

Effects of the Merger

Section 2.5

Articles of Incorporation and By-Laws

Section 2.6

Directors and Officers.

Section 2.7

Additional Actions

ARTICLE III MERGER CONSIDERATION; EXCHANGE PROCEDURES

Section 3.1

Effect on Company Common Stock

Section 3.2

No Fractional Shares; Treasury Stock and Parent-Owned Company Common Stock

Section 3.3

Dissenting Shares.

Section 3.4

Options

Section 3.5

Exchange Agent

Section 3.6

Exchange Procedures

Section 3.7

Taking of Necessary Action; Further Action

Section 3.8

Capital Stock of Merger Sub

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Section 4.1

Organization.

Section 4.2

Capitalization.

Section 4.3

Subsidiaries.

Section 4.4

Authority

Section 4.5

Consents and Approvals; No Violations.

Section 4.6

Books and Records

Section 4.7

SEC Reports and Financial Statements.

Section 4.8

Absence of Company Material Adverse Effect

Section 4.9

No Undisclosed Liabilities

Section 4.10

Benefit Plans; Employees and Employment Practices.

Section 4.11

Employment/Labor.

Section 4.12

Contracts.

Section 4.13

Litigation

Section 4.14

Compliance with Applicable Law.

Section 4.15

Taxes and Tax Returns.

Section 4.16

Environmental Matters.

Section 4.17

State Takeover Statutes

Section 4.18

Intellectual Property

Section 4.19

Library Films; Library Film Materials

Section 4.20

Films in Progress; Development Projects

Section 4.21

Absence of Indemnifiable Claims, etc

Section 4.22

Opinion of Financial Advisor

Section 4.23

Board Approval

Section 4.24

Voting Requirements

Section 4.25

Brokers and Finders

Section 4.26

Information Supplied

ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Section 5.1   

Organization

Section 5.2

Capitalization 

Section 5.3

Authority 

Section 5.4

Consents and Approvals; No Violations.    

Section 5.5

SEC Reports and Financial Statements.  

Section 5.6 

No Undisclosed Liabilities

Section 5.7

Litigation

Section 5.8

Compliance with Applicable Law.    

Section 5.9

Absence of Parent Material Adverse Effect     

Section 5.10

Brokers and Finders     

Section 5.11

Opinion of Financial Advisor     

Section 5.12

Board Approval    

Section 5.13

Information Supplied    

Section 5.14

Interim Operations of Merger Sub  

ARTICLE VI COVENANTS

Section 6.1  

Covenants of the Company    

Section 6.2

Covenants of the Parent     

Section 6.3

No Solicitation.    

Section 6.4

Company Board Recommendation; Termination Right for Superior Proposal.     

Section 6.5

Company Shareholder Meeting     

Section 6.6   

Form S-4 and Proxy Statement 

Section 6.7

Access to Information     

Section 6.8  

Reasonable Best Efforts.   

Section 6.9

State Takeover Statutes     

Section 6.10 

Indemnification and Insurance.    

Section 6.11

Certain Litigation     

Section 6.12 

Notification of Certain Matters.    

Section 6.13 

Affiliate Letters    

Section 6.14  

Employee Benefits; 401(k) Plan.   

Section 6.15

Directorship     

Section 6.16 

Feature Animation Management and Operations    

Section 6.17 

Tax Matters   

Section 6.18 

Certain Plans    

Section 6.19 

Section 16 Matters    

Section 6.20 

Grant of Performance Unit Awards    

ARTICLE VII CONDITIONS

Section 7.1

Conditions to Each Party’s Obligation to Effect the Merger    

Section 7.2

Conditions to Parent and Merger Sub’s Obligation to Effect the Merger    

Section 7.3

Conditions to the Company’s Obligation to Effect the Merger    

ARTICLE VIII TERMINATION AND AMENDMENT

Section 8.1

Termination    

Section 8.2

Effect of Termination     

Section 8.3

Termination Fees.    

Section 8.4

Amendment     

Section 8.5

Extension; Waiver     

ARTICLE IX MISCELLANEOUS

Section 9.1

Nonsurvival of Representations and Warranties; Survival of Certain Covenants and Agreements     

Section 9.2

Notices     

Section 9.3

Interpretation.     

Section 9.4

Counterparts     

Section 9.5

Entire Agreement; No Third Party Beneficiaries     

Section 9.6

Governing Law     

Section 9.7

Publicity    

Section 9.8

Assignment     

Section 9.9

Enforcement     

Section 9.10

Incorporation of Exhibits     

Section 9.11

Severability     

Section 9.12

Expenses