<PAGE>   1
                                                                  Exhibit 10.26k


                  REIMBURSEMENT AND CASH COLLATERAL AGREEMENT, dated as of
February 15, 2000, between GT INTERACTIVE SOFTWARE CORP. (the "Account Party")
and FIRST UNION NATIONAL BANK ("First Union"), as issuing lender (in such
capacity, the "Issuing Lender").

                              STATEMENT OF PURPOSE:

                  The Account Party and the Issuing Lender are parties to the
Credit Agreement, dated as of September 11, 1998 (as heretofore amended,
supplemented or otherwise modified, the "Credit Agreement"), among the Account
Party, as the borrower (in such capacity, the "Borrower"), the lenders from time
to time parties thereto (the "Existing Lenders") and First Union National Bank,
as administrative agent for the Existing Lenders (the "Existing Agent").

                  Pursuant to a Master Assignment and Acceptance, dated as of
the date hereof (the "Assignment and Acceptance"), Infogrames Entertainment SA
("Infogrames") will acquire all of the commitments of each of the Existing
Lenders under the Credit Agreement, and in connection therewith, is required to
deposit cash collateral in respect of the Letters of Credit outstanding on the
Assignment Effective Date, as more fully set forth therein.

                  In connection with the acquisition by Infogrames of the
commitments under the Credit Agreement pursuant to the Assignment and
Acceptance, the Existing Agent will resign as Administrative Agent under the
Credit Agreement and the other Loan Documents (as defined in the Credit
Agreement), and the Borrower has informed the Existing Agent that the Borrower
and Infogrames, as the sole lender under the Credit Agreement on the Assignment
Effective Date, will appoint Infogrames as successor Administrative Agent under
the Credit Agreement and the other Loan Documents pursuant to Section 12.9 of
the Credit Agreement.

                  In connection with the resignation of the Existing Agent and
pursuant to a Collateral Assignment Agreement, dated as of the date hereof (the
"Collateral Assignment Agreement"), the Existing Agent will assign to
Infogrames, as successor Administrative Agent under the Credit Agreement, all of
the Existing Agent's right, title and interest in the Collateral and the
Collateral Documents (each such capitalized term as defined in the Collateral
Assignment Agreement).

                  The Account Party and Infogrames have requested that the
Letters of Credit issued under the Credit Agreement and outstanding on the
Assignment Effective Date remain outstanding until the expiry thereof by their
respective terms and have
<PAGE>   2
requested that the Issuing Lender enter into this Agreement to set forth (a) the
terms under which the Letters of Credit would remain outstanding and (b) the
reimbursement obligations in respect of such Letters of Credit.

                  NOW, THEREFORE, in consideration of the premises and to induce
the Issuing Lender to enter into this Agreement, the Account Party hereby agrees
with the Issuing Lender as follows:

                                    ARTICLE 1
                                   DEFINITIONS

                  SECTION 1.1. Defined Terms. (a) The following terms shall have
the following meanings:

                  "Account Collateral": the collective reference to the Cash
Collateral and the Cash Collateral

Account.

                  "Agreement": this Reimbursement and Cash Collateral Agreement,
as the same may be amended, supplemented or otherwise modified from time to
time.

                  "Application": the application relating to a Letter of Credit
pursuant to which the Issuing Lender issued such Letter of Credit

                  "Assignment and Acceptance": as defined in the Statement of
Purpose.

                  "Assignment Effective Date": as defined in the Assignment and
Acceptance.

                  "Business Day": any day other than a Saturday, Sunday or legal
holiday on which banks in Charlotte, North Carolina and New York, New York, are
open for the conduct of their domestic commercial banking business.

                  "Cash Collateral": the collective reference to:

                  (a) all cash, instruments, securities and funds deposited from
time to time in the Cash Collateral Account;

                  (b) all investments of funds in the Cash Collateral Account
and all instruments and securities evidencing such investments; and


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<PAGE>   3
         (c) all interest, dividends, cash, instruments, securities and other
property received in respect of, or as proceeds of, or in substitution or
exchange for, any of the foregoing.

                  "Cash Collateral Account": account no. 2000002149297
established at the office of First Union National Bank at 301 South College
Street, Charlotte, North Carolina 28288-0737, designated "GT Interactive
Software Collateral Custody Account".

                  "Code": means the Uniform Commercial Code as in effect in the
State of North Carolina; provided that, if by reason of mandatory provisions of
law, the perfection or the effect of perfection or non-perfection of the
security interests in any Account Collateral is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than North Carolina, "Code"
means the Uniform Commercial Code as in effect in such other jurisdiction for
purposes of the provisions hereof relating to such perfection or effect of
perfection or non-perfection.

                  "Collateral Assignment Agreement": as defined in the Statement
of Purpose.

                  "Contractual Obligation": as to any Person, any material
provision of any security issued by such Person or of any material agreement,
instrument or other undertaking to which such Person is a party or by which it
or any of its property is bound.

                  "Credit Agreement": as defined in the Statement of Purpose.

                  "Credit Documents": this Agreement, the Applications and all
other agreements, instruments and documents delivered in connection herewith.

                  "Dollars" and "$": dollars in lawful currency of the United
States of America.

                  "Governmental Authority": any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.

                  "Letters of Credit": the collective reference to the letters
of credit described on Schedule A.

                  "Lien": any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or other
security interest or


                                       3
<PAGE>   4
any preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever (including without limitation, any conditional
sale or other title retention agreement and any financing lease having
substantially the same economic effect as any of the foregoing).

                  "Obligations": in each case, whether now in existence or
hereafter arising: (a) the Reimbursement Obligations and (b) all other fees and
commissions (including reasonable attorney's fees), charges, obligations,
covenants and duties owing by the Account Party to the Issuing Lender under or
in respect of this Agreement, any Letter of Credit or any of the other Credit
Documents, of every kind, nature and description, direct or indirect, absolute
or contingent, due or to become due, contractual or tortious, liquidated or
unliquidated, and whether or not evidenced by any note.

                  "Permitted Investments": investments in (a) marketable direct
obligations issued or unconditionally guaranteed by the United States of America
or any agency thereof maturing within 365 days from the date of acquisition
thereof, (b) commercial paper maturing no more than 365 days from the date of
creation thereof and currently having at least "A2P2" rating obtainable from
either Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc. or Moody's Investors Service, Inc., (c) certificates of deposit
maturing no more than 365 days from the date of creation thereof issued by
commercial banks incorporated under the laws of the United States of America,
each having combined capital, surplus and undivided profits of not less than
$500,000,000 and having a rating of "A" or better by a nationally recognized
rating agency, or (d) time deposits maturing no more than 30 days from the date
of creation thereof with commercial banks or savings banks or savings and loan
associations each having membership either in the Federal Deposit Insurance
Corporation, or any successor thereto (the "FDIC"), or the deposits of which are
insured by the FDIC and in amounts not exceeding the maximum amounts of
insurance thereunder.

                  "Person": an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.

                  "Prime Rate" means, at any time, the rate of interest per
annum publicly announced from time to time by First Union as its prime rate.
Each change in the Prime Rate shall be effective as of the opening of business
on the day such change in the Prime Rate occurs. The parties hereto acknowledge
that the rate announced publicly by First Union as its Prime Rate is an index or
base rate and shall not necessarily be its lowest or best rate charged to its
customers or other banks.


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<PAGE>   5
                  "Reimbursement Obligations": the obligations of the Account
Party to reimburse the Issuing Lender pursuant to Section 2.3 for amounts drawn
under the Letters of Credit.

                  "Requirement of Law": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.

                  "Uniform Customs": the Uniform Customs and Practice for
Documentary Credits (1994 Revision), International Chamber of Commerce
Publication No. 500, and any amendment thereof.

                  (b) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and section and
paragraph references are to this Agreement unless otherwise specified.

                  (c) The meanings given to terms defined herein shall be
equally applicable to both the singular and plural forms of such terms.

                                    ARTICLE 2
                            REIMBURSEMENT PROVISIONS

                  SECTION 2.1 Letters of Credit. (a) The Letters of Credit shall
be deemed to have been issued under this Agreement on the Assignment Effective
Date and, thereafter, the Letters of Credit and the obligations and liabilities
of the Account Party and the Issuing Lender in respect thereof shall be governed
by and subject to the terms and conditions of this Agreement.

                  (b) The Account Party hereby acknowledges that the Issuing
Lender shall have no obligation to extend the expiry date of any Letter of
Credit as set forth on Schedule A.

                  (c) On or before June 30, 2000, the Account Party shall have
(i) provided the Issuing Lender with (A) a replacement letter of credit, in form
and substance reasonably satisfactory to the Issuing Lender, for each Letter of
Credit, or (B) a "back-to-back" letter of credit, in form and substance, and
issued by an issuing lender, reasonably


                                       5
<PAGE>   6
satisfactory to the Administrative Agent, for each Letter of Credit or (ii)
obtained the written consent of the beneficiary of each Letter of Credit to
cancel such Letter of Credit.

                  SECTION 2.2 Letter of Credit Fees, Commissions and Other
Charges.

                  (a) The Account Party shall pay to the Issuing Lender a letter
of credit commission with respect to each Letter of Credit in an amount equal to
the face amount of such Letter of Credit multiplied by 4%. Such commission shall
be payable monthly in arrears on the last Business Day of each calendar month.

                  (b) In addition to the foregoing commissions, the Account
Party shall upon demand by the Issuing Lender pay or reimburse the Issuing
Lender for such normal and customary costs and expenses as are incurred or
charged by the Issuing Lender in issuing, effecting payment under, amending or
otherwise administering any Letter of Credit.

                  SECTION 2.3 Reimbursement Obligations. The Account Party
agrees to reimburse the Issuing Lender on each date on which the Issuing Lender
notifies the Account Party of the date and amount of a draft or drawing paid
under any Letter of Credit for the amount of (a) such draft or drawing, as
applicable, so paid and (b) any taxes, reasonable fees, charges or other
reasonable costs or expenses incurred by the Issuing Lender in connection with
such payment. Each such payment shall be made to the Issuing Lender at its
address for notices specified in Section 5.3 in Dollars and in immediately
available funds. Interest shall be payable on any and all amounts remaining
unpaid by the Account Party under this Article from the date such amounts become
payable until payment in full at a rate per annum equal to the Prime Rate, plus
4.5%. If the Account Party fails to timely reimburse the Issuing Lender on the
date the Account Party receives the notice referred to in this Section, the
Issuing Lender may apply funds on deposit in the Cash Collateral Account to
reimburse the Issuing Lender for the amount of any such payment in the manner
set forth in Section 3.6.

                  SECTION 2.4 Obligations Absolute. The Account Party's
obligations under this Article 2 (including without limitation, the
Reimbursement Obligations) shall be absolute and unconditional under any and all
circumstances and irrespective of any set-off, counterclaim or defense to
payment which the Account Party may have or have had against the Issuing Lender
or any beneficiary of a Letter of Credit. The Account Party also agrees with the
Issuing Lender that the Issuing Lender shall not be responsible for, and the
Account Party's Reimbursement Obligations shall not be affected by, among other
things, the validity or genuineness of documents or of any endorsements thereon,
even though such documents shall in fact prove to be invalid, fraudulent or
forged, or any


                                       6
<PAGE>   7
dispute between or among the Account Party and any beneficiary of any Letter of
Credit or any other party to which such Letter of Credit may be transferred or
any claims whatsoever of the Account Party against any beneficiary of such
Letter of Credit or any such transferee. The Issuing Lender shall not be liable
for any error, omission, interruption or delay in transmission, dispatch or
delivery of any message or advice, however transmitted, in connection with any
Letter of Credit, except for errors or omissions caused by the Issuing Lender's
gross negligence or willful misconduct. The Account Party agrees that any action
taken or omitted by the Issuing Lender under or in connection with any Letter of
Credit or the related drafts or documents, if done in the absence of gross
negligence or willful misconduct and in accordance with the standards of care
specified in the Uniform Customs and, to the extent not inconsistent therewith,
the Code shall be binding on the Account Party and shall not result in any
liability of the Issuing Lender to the Account Party. The responsibility of the
Issuing Lender to the Account Party in connection with any draft presented for
payment under any Letter of Credit shall, in addition to any payment obligation
expressly provided for in such Letter of Credit, be limited to determining that
the documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are in conformity with such Letter of Credit.

                  SECTION 2.5 Payments; Computation of Interest and Fees. Each
payment by the Account Party on account of any amount due under this Agreement
shall be made in Dollars not later than 1:00 p.m. (Charlotte time) on the date
specified for payment under this Agreement to the Issuing Lender at its address
for notices specified in Section 5.3, in immediately available funds and shall
be made without any set-off, counterclaim or deduction whatsoever. Any payment
received after 2:00 p.m. (Charlotte time) shall be deemed to have been made on
the next succeeding Business Day for all purposes. If any payment under this
Agreement shall be specified to be made upon a day which is not a Business Day,
it shall be made on the next succeeding day which is a Business Day and such
extension of time shall in such case be included in computing any interest if
payable along with such payment. All fees payable hereunder shall be computed on
the basis of a 360-day year and assessed for the actual number of days elapsed
and interest shall be computed on the basis of a 365/66-day year and assessed
for the actual number of days elapsed.

                  SECTION 2.6 Evidence of Debt. The Issuing Lender shall
maintain, in accordance with its usual practice, an account or accounts
evidencing the indebtedness of the Account Party resulting from each drawing
under any Letter of Credit and the amounts of principal and interest payable and
paid from time to time in respect thereof hereunder. In any legal action or
proceeding in respect of this Agreement or any Letter of Credit, the entries
made in such account or accounts shall be prima facie evidence of the


                                       7
<PAGE>   8
existence and amounts of the obligations of the Account Party therein recorded,
provided that any failure to make any such recordation (or any error therein)
shall not affect the obligations of the Account Party to make payments required
under this Agreement or in respect of any Letter of Credit.

                  SECTION 2.7 Uniform Customs. THE LETTERS OF CREDIT SHALL BE
SUBJECT TO THE UNIFORM CUSTOMS.


                                    ARTICLE 3
                                 CASH COLLATERAL

                  SECTION 3.1 Grant of Security Interest. In substitution and
replacement of the Liens securing the Letters of Credit granted in favor of the
Existing Agent pursuant to the Collateral Documents and as collateral security
for the prompt and complete payment and performance when due of the Obligations,
the Account Party hereby grants to the Issuing Lender a security interest in and
to all of the Account Party's right, title and interest in and to the Account
Collateral.

                  SECTION 3.2 Maintenance of Cash Collateral Account. The Cash
Collateral Account shall be maintained until the Obligations have been paid and
performed in full. The Account Collateral shall be subject to the exclusive
dominion and control of the Issuing Lender, which shall hold the Cash Collateral
and administer the Cash Collateral Account subject to the terms and conditions
of this Agreement. The Account Party shall have no right of withdrawal from the
Cash Collateral Account nor any other right or power with respect to the Account
Collateral, except as expressly provided herein.

                  SECTION 3.3 Representation and Warranty as to Account
Collateral. The Account Party represents and warrants to the Issuing Lender that
this Agreement, subject to the filings described in Section 3.4(b), creates in
favor of the Issuing Lender a perfected, first priority security interest in all
of the Account Collateral.

                  SECTION 3.4 Covenants as to Account Collateral. The Account
Party covenants and agrees with the Issuing Lender that:

                  (a) The Account Party will not (i) sell, assign, transfer,
      exchange, or otherwise dispose of, or grant any option with respect to,
      the Account Collateral, or (ii) create, incur or permit to exist any Lien
      or option in favor of, or any claim of any


                                       8
<PAGE>   9
      Person with respect to, any of the Account Collateral, or any interest
      therein, except for the Lien created by this Agreement.

                  (b) The Account Party will maintain the Lien created by this
      Agreement as a first, perfected security interest and defend the right,
      title and interest of the Issuing Lender in and to the Account Collateral
      against the claims and demands of all Persons whomsoever. At any time and
      from time to time, upon the written request of the Issuing Lender, and at
      the sole expense of the Account Party, the Account Party will promptly and
      duly execute and deliver such further instruments and documents and take
      such further actions as the Issuing Lender reasonably may request for the
      purposes of obtaining or preserving the full benefits of this Agreement
      and of the rights and powers herein granted, including without limitation,
      of financing statements under the Code.

                  SECTION 3.5 Investment of Cash Collateral. (a) Collected funds
on deposit in the Cash Collateral Account shall be invested by the Issuing
Lender from time to time in Permitted Investments. All investments shall be made
in the name of the Issuing Lender or a nominee of the Issuing Lender and in a
manner, determined by the Issuing Lender in its sole discretion, that preserves
the Issuing Lender's perfected, first priority Lien in such investments.

                  (b) The Issuing Lender shall have no obligation to invest
collected funds.

                  (c) The Issuing Lender shall have no responsibility to the
Account Party for any loss or liability arising in respect of such investments
of the Cash Collateral (including without limitation, as a result of the
liquidation of any thereof before maturity), except to the extent that such loss
or liability arises from the Issuing Lender's gross negligence or willful
misconduct.

                  (d) The Account Party will pay or reimburse the Issuing Lender
for any and all reasonable costs, expenses and liabilities of the Issuing Lender
incurred in connection with this Agreement, the maintenance and operation of the
Cash Collateral Account and the investment of the Cash Collateral, including
without limitation, any reasonable investment, brokerage or placement
commissions and fees incurred by the Issuing Lender in connection with the
investment or reinvestment of the Cash Collateral.

                  SECTION 3.6 Remedies; Application of Cash Collateral. (a) Upon
the failure of the Account Party to pay (i) the Reimbursement Obligations under
this Agreement when and as due or (ii) any other Obligation (other than any
Reimbursement


                                       9
<PAGE>   10
Obligation) when and as due and such failure shall continue unremedied for three
Business Days, the Issuing Lender may, with notice to the Account Party, but
without any other notice of any kind except notices required by law which may
not be waived, apply Account Collateral, after deducting all reasonable costs
and expenses of every kind incurred in respect thereof or in any way relating to
the Account Collateral or the rights of the Issuing Lender hereunder, including
without limitation, reasonable attorneys' fees and disbursements of counsel to
the Issuing Lender, to the payment of the Obligations then due and payable. In
addition to the rights, powers and remedies granted to it under this Agreement,
the Issuing Lender shall have all the rights, powers and remedies available at
law, including without limitation, the rights and remedies of a secured party
under the Code. To the extent permitted by law, the Account Party waives
presentment, demand, protest and all notices of any kind, except for notices
referred to in this Section, and all claims, damages and demands it may acquire
against the Issuing Lender arising out of the exercise by it of any rights
hereunder.

                  (b) The Account Party shall remain liable for any deficiency
if the proceeds of any sale or other disposition of the Account Collateral are
insufficient to pay the Obligations and the reasonable fees and disbursements of
any attorneys employed by the Issuing Lender to collect such deficiency.

                  SECTION 3.7 Release of Cash Collateral. (a) The Issuing Lender
shall release the Cash Collateral to the Account Party within two Business Days
after the date on which a Letter of Credit shall have expired in accordance with
its terms in an amount equal to 105% of the face amount of such Letter of
Credit, less (i) any Obligations paid prior to such date in respect of such
Letter of Credit and (ii) any Obligations remaining unpaid on such date in
respect of such Letter of Credit.

                  (b) Upon release of any portion of the Account Collateral in
accordance with this Section, the Issuing Lender shall, at the Account Party's
expense, promptly execute and deliver to the Account Party such documents as the
Account Party shall request to evidence the release of such Account Collateral
from the Liens granted hereby.

                  (c) This Agreement shall remain in effect from the date hereof
through and including the date upon which all Obligations shall have been
indefeasibly and irrevocably paid and satisfied in full and upon such date this
Agreement shall terminate and the Liens granted hereby shall terminate and all
rights to the Account Collateral shall revert to the Account Party. Upon any
such termination, (i) the Issuing Lender shall promptly assign, release,
transfer and deliver to the Account Party the Account Collateral held by it
hereunder, all instruments of assignment executed in connection therewith,


                                       10
<PAGE>   11
together with all monies held by the Issuing Lender or any of its agents
hereunder, free and clear of the Liens hereof and (ii) the Issuing Lender will
promptly execute and deliver to the Account Party such documents and instruments
(including but not limited to appropriate Uniform Commercial Code termination
statements) as the Account Party shall request to evidence such termination in
each such case at the expense of the Account Party.

                  SECTION 3.8 Issuing Lender's Appointment as Attorney-in-Fact.
(a) To permit the Issuing Lender to exercise it rights and remedies under this
Agreement, the Account Party hereby irrevocably constitutes and appoints the
Issuing Lender and any officer or agent of the Issuing Lender, with full power
of substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of the Account Party and in the name
of the Account Party or in the Issuing Lender's own name, from time to time in
the Issuing Lender's discretion, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to accomplish
the purposes of this Agreement, including without limitation, any financing
statements, endorsements, assignments or other instruments of transfer.

                  (b) The Account Party hereby ratifies all that said attorneys
shall lawfully do or cause to be done pursuant to the power of attorney granted
in Section 3.8(a). All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this Agreement
is terminated and the Liens created hereby are released.

                  SECTION 3.9 Duty of Issuing Lender. The Issuing Lender's sole
duty with respect to the custody, safekeeping and physical preservation of the
Account Collateral in its possession, under Section 9-207 of the Code or
otherwise, shall be to comply with the specific duties and responsibilities set
forth herein and to exercise reasonable care to assure the safe custody of the
Account Collateral. The powers conferred on the Issuing Lender in this Agreement
are solely for the protection of the Issuing Lender's interests in the Account
Collateral and shall not impose any duty upon the Issuing Lender to exercise any
such powers. Neither the Issuing Lender nor its directors, officers, employees
or agent shall be liable for any action lawfully taken or omitted to be taken by
any of them under or in connection with the Account Collateral or this
Agreement, except for its or their gross negligence or willful misconduct.

                  SECTION 3.10 Execution of Financing Statements. Pursuant to
Section 9-402 of the Code, the Account Party authorizes the Issuing Lender to
file financing statements with respect to the Account Collateral without the
signature of the Account


                                       11
<PAGE>   12
Party in such form and in such filing offices as the Issuing Lender reasonably
determines appropriate to perfect the Liens of the Issuing Lender under this
Agreement. A carbon, photographic or other reproduction of this Agreement shall
be sufficient as a financing statement for filing in any jurisdiction.


                                    ARTICLE 4
                                   CONDITIONS

                  SECTION 4.1 Conditions. This Agreement shall become effective
upon the satisfaction of the following conditions precedent:

                  (a) Agreement. The Issuing Lender shall have received this
      Agreement, executed and delivered by a duly authorized officer of the
      Account Party.

                  (b) Assignment and Acceptance. The Assignment Effective Date
      shall have occurred under the Assignment and Acceptance.

                  (c) Deposit of Cash Collateral. The Account Party shall
      deposit, and the Issuing Lender shall have received, in the Cash
      Collateral Account immediately available funds in the amount equal to 105%
      of the aggregate undrawn face amount of the Letters of Credit, as set
      forth on Schedule A as of the Assignment Effective Date.

                  (d) Amendment to Credit Agreement. The Issuing Lender shall
      have received a copy of an executed amendment to the Credit Agreement, in
      form and substance reasonably satisfactory to the Issuing Lender,
      permitting the existence of the indebtedness and the Liens under this
      Agreement, and such amendment shall have become effective in accordance
      with its terms.


                                    ARTICLE 5
                                  MISCELLANEOUS

                  SECTION 5.1 Representations and Warranties. The Account Party
hereby represents and warrants to the Issuing Lender that:

                  (a) The Account Party has the corporate power and authority to
execute and deliver and to perform its obligations under, and has taken all
necessary corporate action to authorize the execution, delivery and performance
of, this Agreement.


                                       12
<PAGE>   13
                  (b) This Agreement constitutes a legal, valid and binding
obligation of the Account Party enforceable in accordance with its terms, except
as affected by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.

                  (c) The execution, delivery and performance of this Agreement
will not violate any material provision of any Requirement of Law or Contractual
Obligation of the Account Party and will not result in the creation or
imposition of any Lien on any of the properties or revenues of the Account Party
pursuant to any material provision of any Requirement of Law or Contractual
Obligation of the Account Party.

                  (d) No consent or authorization of, filing with, or other act
by or in respect of, any arbitrator or Governmental Authority and no consent of
any other Person (including without limitation, any stockholder or creditor of
the Account Party), is required in connection with the execution, delivery,
performance, validity or enforceability of this Agreement.

                  SECTION 5.2 Method of Communication. Except as otherwise
provided in this Agreement, all notices and communications hereunder shall be in
writing, or by telephone subsequently confirmed in writing. Any notice shall be
effective if delivered by hand delivery or sent via telecopy, recognized
overnight courier service or certified mail, return receipt requested, and shall
be presumed to be received by a party hereto (a) on the date of delivery if
delivered by hand or sent by telecopy, (b) on the next Business Day if sent by
recognized overnight courier service and (c) on the third Business Day following
the date sent by certified mail, return receipt requested. A telephonic notice
to the Issuing Lender as understood by the Issuing Lender will be deemed to be
the controlling and proper notice in the event of a discrepancy with or failure
to receive a confirming written notice.

                  SECTION 5.3 Notices. Notices to any party shall be sent to it
at the following addresses, or any other address as to which all the other
parties are notified in writing.

<TABLE>
<S>                                                  <C>
                 If to the Account Party:            GT Interactive Software Corp.
                                                     417 Fifth Avenue, 8th Floor
                                                     New York, New York  10016
                                                     Attention:  Robert De Laurentis
</TABLE>


                                       13
<PAGE>   14
<TABLE>
<S>                                                  <C>
                                                     Telephone No.:  (212) 726-6553
                                                     Telecopy No.:  (212) 726-6590

                 With copies to:                     Kramer, Levin, Naftalis & Frankel
                                                     919 Third Avenue
                                                     New York, New York  10022-3903
                                                     Attention: David P. Levin, Esq.
                                                     Telephone No.:  (212) 715-9217
                                                     Telecopy No.:  (212) 715-8000

                                                     Infogrames Entertainment SA
                                                     84, rue du 1er Mars 1943
                                                     Villeurbanne, 69100
                                                     France
                                                     Attention:  Olivier Carton
                                                     Telephone No.:  (011 33) 472 655000
                                                     Telecopy No.:  (011 33) 472 655116

                                                     Pillsbury Madison & Sutro LLP
                                                     50 Fremont Street
                                                     San Francisco, California  94105
                                                     Attention:  Ronald Bornstein
                                                     Telephone No.:  (415) 983-1000
                                                     Telecopy No.:  (415) 983-1200

                 If to Issuing Lender:               First Union National Bank
                                                     One First Union Center, TW-10
                                                     301 South College Street
                                                     Charlotte, North Carolina  28288-0608
                                                     Attention:  John McGowan
                                                     Telephone No.:  (704) 374-7096
                                                     Telecopy No.:  (704) 383-6249
</TABLE>

                  SECTION 5.4 Amendments and Waivers. None of the terms or
provisions of this Agreement may be waived, amended, supplemented or otherwise
modified except by a written instrument executed by the Account Party and the
Issuing Lender.

                  SECTION 5.5 Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective


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to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

                  SECTION 5.6 Integration. This Agreement and the other Credit
Documents represent the agreement of the Account Party and the Issuing Lender
with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Issuing Lender or the Account
Party relative to subject matter hereof not expressly set forth or referred to
herein or in the other Credit Documents.

                  SECTION 5.7 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Issuing Lender, any
right, remedy, power or privilege hereunder or under the other Credit Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.

                  SECTION 5.8 Payment of Expenses; Indemnity. The Account Party
will (a) pay all reasonable out-of-pocket expenses of the Issuing Lender in
connection with (i) the preparation, execution and delivery of this Agreement
and each other Credit Document, whenever the same shall be executed and
delivered, (ii) the preparation, execution and delivery of any waiver, amendment
or consent by the Issuing Lender relating to this Agreement or any other Credit
Document, including without limitation reasonable fees and disbursements of
counsel for the Issuing Lender and (iii) the administration and enforcement of
any rights and remedies of the Issuing Lender under this Agreement or any other
Credit Document, including consulting with accountants and attorneys concerning
the nature, scope or value of any right or remedy of the Issuing Lender
hereunder or under any other Credit Document or any factual matters in
connection therewith, which expenses shall include without limitation the
reasonable fees and disbursements of such Persons, and (b) defend, indemnify and
hold harmless the Issuing Lender, and its parents, subsidiaries, affiliates,
employees, agents, officers and directors, from and against any losses,
penalties, fines, liabilities, judgments, settlements, damages, costs and
expenses, suffered by any such Person in connection with any claim,
investigation, litigation or other proceeding (whether or not the Issuing Lender
is a party thereto) and the prosecution and defense thereof, arising out of or
in any way connected with this Agreement, the Letters of Credit or any other
Credit Document, including without limitation, reasonable attorney's and
consultant's fees of the Issuing Lender,


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except to the extent that any of the foregoing directly result from the gross
negligence or willful misconduct of the party seeking indemnification therefor.

                  SECTION 5.9 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the Account Party and the Issuing
Lender and their respective successors and assigns, except that either party may
not assign or transfer any of its rights or obligations under this Agreement
without the prior written consent of the other party hereto.

                  SECTION 5.10 WAIVERS OF JURY TRIAL. THE ACCOUNT PARTY AND THE
ISSUING LENDER HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY LETTER OF CREDIT
AND FOR ANY COUNTERCLAIM THEREIN.

                  SECTION 5.11 Section Headings. The section headings used in
this Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.

                  SECTION 5.12 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.


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                  IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the date first above written.


                                          GT INTERACTIVE SOFTWARE CORP.


                                          By:Denis Guyennot
                                             ---------------------------
                                             Name: Denis Guyennot



                                          FIRST UNION NATIONAL BANK,
                                          as Issuing Lender


                                          By: John McJowan
                                             ---------------------------
                                             Name: John McJowan


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