For Prescriptive Compliance Method, “Exception” in section 503.4 allows a break for any existing lateral load carrying element whose demand-capacity ratio with the alteration considered is not more than 10% greater than its D/C ratio with the alteration ignored.
For Work Area Compliance Method, no such break is allowed for Level 3 Alterations in section 906.2.

I asked ICC for confirmation to see if that is indeed the intent. I was told the following:

902.1 indicates Level 3 alterations should comply with all the requirements of chapters 7 and 8 (Levels 1 and 2 alterations), which means the 10%-rule still applies. However, the “substantial structural alteration” language spelled out in 906.2, as defined in 202, would push the D/C ratio increase over 10% anyway, “no 10% break” was therefore not explicitly excluded in the code language.

I find this explanation dubious because “altering more than 30% of the gravity load-carrying elements supporting the total floor and roof area” as defined in 202 does not always increase the D/C ratio by more than 10% for the lateral load-carrying elements.

At any rate, it seems to me that 10%-rule does not apply for Level 3 alterations as it is not specifically brought up in section 906.2.

That said, for the same “alteration level 3” scope project, one can take the advantage of the 10% break if the Prescriptive Compliance Method is selected. But no such luxury if the Work Area Compliance Method is used instead. This seems counter-intuitive to me as I am under the impression that the more “detailed” Work Area Compliance Method would offer designers more leeway as an incentive. Looks like it’s the other way around here, at least for the lateral load-carrying elements.
I appreciate anyone’s thoughts on this one.