<PAGE>

                                                                    Exhibit 10.1

                       SIXTH AMENDMENT TO CREDIT AGREEMENT

                  SIXTH AMENDMENT, dated as of December 23, 2003 (this
"Amendment"), to the Credit Agreement referred to below among ATARI, INC.,
formerly known as INFOGRAMES, INC., a Delaware corporation ("Borrower"), the
other parties signatory thereto as Credit Parties, the Lenders party thereto
(the "Lenders"), and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware
corporation, for itself, as a Lender, and as agent for the Lenders (in such
capacity, "Agent").

                               W I T N E S S E T H

                  WHEREAS, Borrower and Agent are parties to that certain Credit
Agreement, dated as of November 12, 2002 (as amended, supplemented or otherwise
modified from time to time, the "Credit Agreement"); and

                  WHEREAS, Borrower and Agent have agreed to amend the Credit
Agreement in the manner, and on the terms and conditions, provided for herein;

                  NOW THEREFORE, in consideration of the premises and for other
good and valuable consideration, the receipt, adequacy and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

                  1. Definitions. Capitalized terms not otherwise defined herein
shall have the meanings ascribed to them in the Credit Agreement.

                  2. Amendment to Recitals to the Credit Agreement. As of the
Amendment Effective Date, the Recitals to the Credit Agreement are hereby
amended to delete the last "WHEREAS" clause in its entirety.

                  3. Amendment to Section 6.3(a) of the Credit Agreement. As of
the Amendment Effective Date, Section 6.3(a) of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:

                  "(a)     No Credit Party shall create, incur, assume or permit
                  to exist any Indebtedness, except (without duplication) (i)
                  Indebtedness secured by purchase money security interests and
                  Capital Leases permitted in Section 6.7(c), (ii) the Loans and
                  the other Obligations, (iii) Parent Subordinated Debt at any
                  time, (iv) unfunded pension fund and other employee benefit
                  plan obligations and liabilities to the extent they are
                  permitted to remain unfunded under applicable law, (v)
                  existing Indebtedness described in Disclosure Schedule (6.3)
                  and refinancings thereof or amendments or modifications
                  thereof that do not have the effect of increasing the
                  principal amount thereof or changing the amortization thereof
                  (other than to extend the same) and that are otherwise on
                  terms and conditions no less favorable to any Credit Party,
                  Agent or any Lender, as determined by Agent, than the terms of
                  the

<PAGE>

                  Indebtedness being refinanced, amended or modified, (vi)
                  Indebtedness specifically permitted under Section 6.17, (vii)
                  Indebtedness consisting of intercompany loans, advances and
                  payments (net of any repayments) made after the Closing Date
                  by Interactive to Borrower, and (vii) Indebtedness consisting
                  of intercompany loans, advances and payments (net of any
                  repayments) made after the Closing Date by Paradigm to
                  Borrower; provided that with respect to all intercompany loans
                  and advances referred to in this Section 6.3(a): (A) the
                  applicable Credit Party shall have executed and delivered to
                  such other Credit Party, on the Closing Date, a demand note
                  (collectively, the "Intercompany Notes") to evidence any such
                  intercompany Indebtedness owing at any time to one Credit
                  Party by such other Credit Party, which Intercompany Notes
                  shall be in form and substance reasonably satisfactory to
                  Agent and shall be pledged and delivered to Agent pursuant to
                  the applicable Pledge Agreement as collateral security for the
                  Obligations; (B) each Credit Party shall record all
                  intercompany transactions on its books and records in a manner
                  reasonably satisfactory to Agent; (C) the obligations of each
                  Credit Party under any such Intercompany Notes shall be
                  subordinated to the Obligations pursuant to Section 11.18; (D)
                  at the time any such intercompany loan or advance is made by
                  Borrower and after giving effect thereto, Borrower shall be
                  Solvent; (E) no Default or Event of Default has occurred and
                  is continuing or would occur and be continuing as a result of
                  and after giving effect to, any such proposed intercompany
                  loan or advance."

                  4. Amendment to Section 8.1(n) of the Credit Agreement. As of
the Amendment Effective Date, Section 8.1(n) of the Credit Agreement is hereby
amended and restated in its entirety to read as follows:

                  "(n)     Any default or breach by Borrower occurs and is
                  continuing under the Distribution Agreement or the
                  Distribution Agreement shall be terminated for any reason, or
                  the Trademark License Agreement shall be terminated for any
                  reason."

                  5.       Amendment to Annex A of the Credit Agreement.

                           (a)      As of the Amendment Effective Date, Annex A
of the Credit Agreement is hereby amended by amending and restating the
following definitions in their entirety to read as follows:

                  "`Guarantors' means each Person, if any, that executes a
                    guaranty or other similar agreement on or after the Sixth
                    Amendment Effective Date in favor of Agent, for itself and
                    the ratable benefit of Lenders, in connection with the
                    transactions contemplated by the Agreement and the other
                    Loan Documents.

                                       2
<PAGE>

                   `Intellectual Property Security Agreement' means the Amended
                    and Restated Intellectual Property Agreement dated as of
                    December 23, 2003, entered into by and among Agent, on
                    behalf of itself and Lenders, and each Credit Party that is
                    a signatory thereto.

                   `Pledge Agreement' means the Amended and Restated Pledge
                    Agreement dated as of December 23, 2003, executed by
                    Borrower and each domestic Credit Party in favor of Agent,
                    on behalf of itself and Lenders, pledging the Stock owned by
                    such Pledgor of its respective Subsidiaries, if any, as
                    provided therein, and all Intercompany Notes owing to or
                    held by it.

                   `Security Agreement' means the Amended and Restated Security
                    Agreement dated as of December 23, 2003, entered into by and
                    among Agent, on behalf of itself and Lenders, and each
                    Credit Party that is a signatory thereto."

                           (b)      As of the Amendment Effective Date, Annex A
of the Credit Agreement is hereby amended by adding the following new
definitions in alphabetical order to read as follows:

                    "`Sixth Amendment' shall mean the Sixth Amendment to the
Credit Agreement dated as of December 23, 2003.

                    `Sixth Amendment Effective Date' shall mean December 23,
                    2003.

                    `Trademark License Agreement' shall mean that certain
                    Trademark License Agreement dated September 4, 2003 among
                    ATARI Interactive, Inc., Parent and Atari, Inc."

                  6. Amendment to Annex C of the Credit Agreement. As of the
Amendment Effective Date, Annex C of the Credit Agreement is hereby amended by
deleting the final sentence of paragraph (c) in its entirety, and amending and
restating paragraph (k) in its entirety to read as follows:

                  "(k)     The Credit Parties may maintain funds exclusively for
                  the purposes of cash collateralizing certain letters of credit
                  set forth on Disclosure Schedule 3.25 in those certain
                  accounts with (i) JPMorgan Chase Bank numbered 777-104520 and
                  777-103117 (collectively, the "L/C Collateral Accounts") and
                  such L/C Collateral Accounts are not required to be subject to
                  a tri-party blocked account agreement as required by clause
                  (c) of this Annex C; provided that the amounts held in any
                  such L/C Collateral Account shall not exceed the amount of the
                  undrawn Letter(s) of Credit supported by such account."

                  7. Amendment to Annex E of the Credit Agreement. As of the
Amendment Effective Date, Annex E of the Credit Agreement is hereby amended by
amending and restating clauses (a), (b), and (d) in their entirety to read as
follows:

                                       3
<PAGE>

                  "(a)     Monthly Financials. To Agent and Lenders, within 30
                  days after the end of each Fiscal Month, financial information
                  regarding Borrower (including Reflections), certified by the
                  Chief Financial Officer of Borrower, consisting of
                  consolidated and consolidating (i) unaudited balance sheets as
                  of the close of such Fiscal Month and the related statements
                  of income and cash flows for that portion of the Fiscal Year
                  ending as of the close of such Fiscal Month; (ii) unaudited
                  statements of income and cash flows for such Fiscal Month,
                  setting forth in comparative form the figures for the
                  corresponding period in the prior year and the figures
                  contained in the Projections for such Fiscal Year, all
                  prepared in accordance with GAAP; and (iii) a summary of the
                  outstanding balance of all Intercompany Notes as of the last
                  day of that Fiscal Month. Such financial information shall be
                  accompanied by (A) a statement in reasonable detail (each, a
                  "Compliance Certificate") showing the calculations used in
                  determining compliance with each Financial Covenant that is
                  tested on a monthly basis and (B) the certification of the
                  Chief Financial Officer of Borrower that (i) such financial
                  information presents fairly in accordance with GAAP the
                  financial position and results of operations of Borrower and
                  each Guarantor, on a combined and combining basis, in each
                  case as at the end of such Fiscal Month and for that portion
                  of the Fiscal Year then ended and (ii) any other information
                  presented is true, correct and complete in all material
                  respects and that there was no Default or Event of Default in
                  existence as of such time or, if a Default or Event of Default
                  shall have occurred and be continuing, describing the nature
                  thereof and all efforts undertaken to cure such Default or
                  Event of Default.

                  (b)      Quarterly Financials. To Agent and Lenders, within 45
                  days after the end of each Fiscal Quarter, (i) consolidated
                  and consolidating financial information regarding Borrower
                  (including its Subsidiaries), and (ii) separately prepared
                  financial information on a stand alone basis for GT
                  Interactive Software Australia Pty Limited, a company
                  organized under the laws of Australia, and consolidated
                  financial information for GT Interactive Software (Europe)
                  Limited, a company organized under the laws of the United
                  Kingdom, GT Interactive Software France S.A.R.L., a company
                  organized under the laws of the Republic of France and GT
                  Interactive Software GmbH, a company organized under the laws
                  of Germany, each certified by the Chief Financial Officer of
                  Borrower, including (A) unaudited balance sheets as of the
                  close of such Fiscal Quarter and the related statements of
                  income and cash flow for that portion of the Fiscal Year
                  ending as of the close of such Fiscal Quarter and (B)
                  unaudited statements of income and cash flows for such Fiscal
                  Quarter, in each case setting forth in comparative form the
                  figures for the corresponding period in the prior year and the
                  figures contained in the Projections for such Fiscal Year, all
                  prepared in accordance with

                                       4
<PAGE>

                  GAAP or, in connection with GT Australia and consolidated
                  statements for GT Germany, GT France and GT UK, substantially
                  in accordance with GAAP and in accordance with past practices
                  (subject to normal year-end and quarter-end adjustments). Such
                  financial information shall be accompanied by (A) a statement
                  in reasonable detail (each, a "Compliance Certificate")
                  showing the calculations used in determining compliance with
                  each of the Financial Covenants that is tested on a quarterly
                  basis and (B) the certification of the Chief Financial Officer
                  of Borrower that (i) such financial information presents
                  fairly in accordance with GAAP the financial position, results
                  of operations and statements of cash flows of Borrower and its
                  Subsidiaries, on both a consolidated and consolidating basis,
                  as at the end of such Fiscal Quarter and for that portion of
                  the Fiscal Year then ended, (ii) any other information
                  presented is true, correct and complete in all material
                  respects and that there was no Default or Event of Default in
                  existence as of such time or, if a Default or Event of Default
                  has occurred and is continuing, describing the nature thereof
                  and all efforts undertaken to cure such Default or Event of
                  Default. In addition, Borrower shall deliver to Agent and
                  Lenders, within 45 days after the end of each Fiscal Quarter,
                  a management discussion and analysis that includes a
                  comparison to budget for that Fiscal Quarter and a comparison
                  of performance for that Fiscal Quarter to the corresponding
                  period in the prior year.

                  (d)      Annual Audited Financials. To Agent and Lenders,
                  within 90 days after the end of each Fiscal Year, audited
                  Financial Statements for Borrower (including its Subsidiaries)
                  and unaudited Financial Statements for each other Guarantor on
                  a combined and (unaudited) combining basis, consisting of
                  balance sheets and statements of income and retained earnings
                  and cash flows, setting forth in comparative form in each case
                  the figures for the previous Fiscal Year, which Financial
                  Statements shall be prepared in accordance with GAAP and
                  certified without qualification, by an independent certified
                  public accounting firm of national standing or otherwise
                  acceptable to Agent. Such Financial Statements shall be
                  accompanied by (i) a statement prepared in reasonable detail
                  showing the calculations used in determining compliance with
                  each of the Financial Covenants, (ii) a report from such
                  accounting firm to the effect that, in connection with their
                  audit examination, nothing has come to their attention to
                  cause them to believe that a Default or Event of Default has
                  occurred (or specifying those Defaults and Events of Default
                  that they became aware of), it being understood that such
                  audit examination extended only to accounting matters and that
                  no special investigation was made with respect to the
                  existence of Defaults or Events of Default, (iii) the annual
                  letters to such accountants in connection with their audit
                  examination detailing contingent liabilities and material
                  litigation matters, and (iv) the certification of the Chief
                  Executive Officer or Chief Financial Officer of Borrower that
                  all such Financial Statements present fairly in accordance
                  with GAAP the financial position, results of operations and
                  statements of cash flows of Borrower and its Subsidiaries on a
                  consolidated and consolidating basis, as at the end of such
                  Fiscal

                                       5
<PAGE>

                  Year and for the period then ended, and that there was no
                  Default or Event of Default in existence as of such time or,
                  if a Default or Event of Default has occurred and is
                  continuing, describing the nature thereof and all efforts
                  undertaken to cure such Default or Event of Default."

                  8.       Amendment to Annex G of the Credit Agreement. As of
the Amendment Effective Date, Annex G of the Credit Agreement is amended by
amending and restating clauses (b) and (c) in their entirety to read as follows:

                  "(b)     Minimum Fixed Charge Coverage Ratio. Borrower and
                  Guarantors (which shall include Interactive and Paradigm
                  through and including September 30, 2003) shall have on a
                  combined basis at the end of each Fiscal Quarter beginning
                  with the Fiscal Quarter ending March 31, 2003, a Fixed Charge
                  Coverage Ratio for the 12-month period then ended of not less
                  than the following:

<TABLE>
<CAPTION>
                                                  Fixed Charge
Fiscal Quarter Ending                            Coverage Ratio
---------------------                            --------------
<S>                                              <C>
March 31, 2003                                      1.5:1.00
June 30, 2003                                       1.5:1.00
September 30, 2003                                  0.5:1.00
and for each Fiscal Quarter
thereafter                                          1.5:1.00
</TABLE>

                   provided, however, that if (i) the Production Fund Closing
                   occurs on or prior to August 22, 2003, or (ii) the Offering
                   Transactions occur before September 30, 2003, there shall be
                   no minimum Fixed Charge Coverage Ratio requirement for the
                   Fiscal Quarter ending September 30, 2003, and provided,
                   further, however, that there shall be no minimum Fixed Charge
                   Coverage Ratio requirement for the Fiscal Quarter ending
                   December 31, 2003.

                  (c)      Minimum EBITDA. Borrower and Guarantors (which shall
                  include Interactive and Paradigm through and including
                  September 30, 2003) on a combined basis shall have, at the end
                  of each Fiscal Quarter set forth below, EBITDA for the
                  12-month period then ended of not less than the following:

<TABLE>
<CAPTION>
Period                                                EBITDA
------                                                ------
<S>                                                <C>
Fiscal Quarter ending
December 31, 2002                                  ($  7,000,000)
</TABLE>

                                       6
<PAGE>

<TABLE>
<S>                                                <C>
Fiscal Quarter ending March
31, 2003                                            $ 20,000,000

Fiscal Quarter ending June
30, 2003                                            $ 20,000,000

Fiscal Quarter ending
September 30,2003                                   $ 10,500,000

Fiscal Quarter ending December 31,
2003                                               ($ 20,000,000)

Fiscal Quarter ending March
31, 2004                                            $ 20,000,000

for each Fiscal Quarter ending
thereafter                                          $ 20,000,000
</TABLE>

                  provided, however, that if (i) the Production Fund Closing
                  occurs on or prior to August 22, 2003, or (ii) the Offering
                  Transactions occur before September 30, 2003, the EBITDA for
                  the 12 - month period ending September 30, 2003 shall be no
                  less than ($500,000)."

                  9.       Amendment to Disclosure Schedules. The Disclosure
Schedules attached to the Credit Agreement are hereby amended and restated in
their entirety as of the Amendment Effective Date to read as set forth on Annex
I hereto.

                  10.      Release of Interactive and Paradigm. As of the
Amendment Effective Date, Agent and Lenders agree that Borrower shall be
authorized to file UCC-3 termination statements, mortgage satisfactions,
releases of liens, discharges, terminations and other release documentation
releasing Agent's liens and security interests in all of the assets and property
of Interactive and Paradigm (the "Property"). In consideration of valuable
consideration receipt of which is hereby acknowledged, Agent and Lenders hereby
remise, release and discharge Interactive and Paradigm, and their successors and
assigns, and Interactive and Paradigm hereby remise, release and discharge Agent
and Lenders, and their successors and assigns, of and from any and all claims,
demands, debts, accounts, contracts, obligations, liabilities, actions and
causes of action, whether in law or in equity, which either party ever had, now
has, or hereafter may have against the other, directly or indirectly arising out
of or in any way relating to the Credit Agreement, the Guaranty, the Security
Agreement, the Pledge Agreement, the Intellectual Property Security Agreement,
the Parent Subordination Agreement (each solely in its capacity as a Credit
Party), any tri-party blocked account agreements to which either Interactive or
Paradigm is a party, and the other Loan Documents, any amendments thereto, or
any transactions between Agent and Lenders and Interactive or Paradigm
thereunder. Agent agrees to take all reasonable additional steps requested by
Borrower, Interactive or Paradigm as may be necessary to release Agent's
security interests in the Property.

                                       7
<PAGE>

                  11.      Blocked Accounts. After giving effect to this
Amendment, no deposit accounts of Interactive or Paradigm shall be subject to
any tri-party blocked account agreements with Agent, for the benefit of itself
and Lenders, and such tri-party blocked account agreements, including those
deposit accounts set forth on Schedule 1 hereto, are hereby terminated and are
of no further force or effect.

                  12.      Guaranty. Each of parties hereto agrees and
acknowledges that on the date hereof, after giving effect to this Amendment, the
Guaranty is hereby terminated and is of no further force or effect.

                  13.      Representations and Warranties. To induce Agent and
Lenders to enter into this Amendment, Borrower hereby represents and warrants
that:

                  (a)      The execution, delivery and performance of this
         Amendment and the performance of the Credit Agreement as amended by
         this Amendment (the "Amended Credit Agreement") by Borrower and the
         other Credit Parties: (i) are within their respective organizational
         powers; (ii) have been duly authorized by all necessary corporate and
         shareholder action; (iii) are not in contravention of any provision of
         their respective certificates or articles of incorporation or by-laws
         or other organizational documents; (iv) do not violate any law or
         regulation, or any order or decree of any court or Governmental
         Authority; (v) do not conflict with or result in the breach or
         termination of, constitute a default under or accelerate or permit the
         acceleration of any performance required by, any indenture, mortgage,
         deed of trust, lease, agreement or other instrument to which any
         Borrower or any Credit Party is a party or by which Borrower or any
         Credit Party or any of its property is bound; (vi) do not result in the
         creation or imposition of any Lien upon any of the property of Borrower
         or any Credit Party other than those in favor of Agent pursuant to the
         Loan Documents; and (vii) do not require the consent or approval of any
         Governmental Authority or any other Person.

                  (b)      This Amendment has been duly executed and delivered
         by or on behalf of each Credit Party.

                  (c)      Each of this Amendment and the Amended Credit
         Agreement constitutes a legal, valid and binding obligation of each
         Credit Party enforceable against each Credit Party in accordance with
         its terms, except as enforceability may be limited by applicable
         bankruptcy, insolvency, reorganization, moratorium or similar laws
         affecting creditors' rights generally and by general equitable
         principles (whether enforcement is sought by proceedings in equity or
         at law).

                  (d)      No Default or Event of Default has occurred and is
         continuing both before and after giving effect to this Amendment.

                  (e)      No action, claim or proceeding is now pending or, to
         the knowledge of Borrower and the other Credit Parties, threatened
         against Borrower or the other Credit Parties, at law, in equity or
         otherwise, before any court, board,

                                       8
<PAGE>

         commission, agency or instrumentality of any federal, state, or local
         government or of any agency or subdivision thereof, or before any
         arbitrator or panel of arbitrators, (i) which challenges Borrower's or
         the other Credit Parties' right, power, or competence to enter into
         this Amendment or, to the extent applicable, perform any of its
         obligations under this Amendment, the Amended Credit Agreement or any
         other Loan Document, or the validity or enforceability of this
         Amendment, the Amended Credit Agreement or any other Loan Document or
         any action taken under this Amendment, the Amended Credit Agreement or
         any other Loan Document or (ii) which, if determined adversely, is
         reasonably likely to have or result in a Material Adverse Effect. To
         the knowledge of Borrower and each Credit Party, there does not exist a
         state of facts which is reasonably likely to give rise to such
         proceedings.

                  (f)      After giving effect to this Amendment, the
         representations and warranties of Borrower and the other Credit Parties
         contained in the Credit Agreement and each other Loan Document shall be
         true and correct on and as of the date hereof and the Amendment
         Effective Date with the same effect as if such representations and
         warranties had been made on and as of each such date, except that any
         such representation or warranty which is expressly made only as of a
         specified date need be true only as of such date.

                  14.      Ratification of Credit Agreement; Remedies.

                  (a)      Except as expressly provided for, and on the terms
and conditions set forth, herein, the Credit Agreement and the other Loan
Documents shall continue to be in full force and effect in accordance with their
respective terms and shall be unmodified. In addition, this Amendment shall not
be deemed a waiver of any term or condition of any Loan Document by the Agent or
the Lenders with respect to any right or remedy which the Agent or the Lenders
may now or in the future have under the Loan Documents, at law or in equity or
otherwise or be deemed to prejudice any rights or remedies which the Agent or
the Lenders may now have or may have in the future under or in connection with
any Loan Document or under or in connection with any Default or Event of Default
which may now exist or which may occur after the date hereof. The Credit
Agreement and all other Loan Documents are hereby in all respects ratified and
confirmed.

                  (b)      This Amendment shall constitute a Loan Document. The
breach by any Credit Party of any representation, warranty, covenant or
agreement in this Amendment shall constitute an immediate Event of Default
hereunder and under the other Loan Documents.

                  15.      Outstanding Indebtedness; Waiver of Claims. Each of
Borrower and the other Credit Parties hereby acknowledges and agrees that as of
December 18, 2003 the aggregate outstanding principal amount of the Revolving
Loan is $11,989,463.10 and such principal amount is payable pursuant to the
Credit Agreement without defense, offset, withholding, counterclaim or deduction
of any kind. Borrower and each other Credit Party hereby waives, releases,
remises and forever discharges

                                       9
<PAGE>

Agent, Lenders and each other Indemnified Person from any and all suits,
actions, proceedings, claims, damages, losses, liabilities and expenses
(including reasonable attorneys' fees) and disbursements and other costs of
investigation or defense, including those incurred upon any appeal of any kind
or character, known or unknown, which Borrower or any other Credit Party ever
had, now has or might hereafter have against Agent or any Lender which relates,
directly or indirectly, to any acts or omissions of Agent or such Lender or any
other Indemnified Person on or prior to the Amendment Effective Date.

                  16.      Expenses. Each of Borrower and the other Credit
Parties hereby reconfirms its respective obligations pursuant to Section 11.3 of
the Credit Agreement to pay and reimburse Agent for all reasonable out-of-pocket
expenses (including, without limitation, reasonable fees of counsel) incurred in
connection with the negotiation, preparation, execution and delivery of this
Amendment and all other documents and instruments delivered in connection
herewith.

                  17.      Affirmation of Existing Loan Documents. After giving
effect to this Amendment, Borrower (a) confirms and agrees that its obligations
under each of the Loan Documents to which it is a party shall continue without
any diminution thereof and shall remain in full force and effect on and after
the date hereof, and (b) confirms and agrees that the Liens granted pursuant to
the Collateral Documents to which they it is a party shall continue without any
diminution thereof and shall remain in full force and effect on and after the
date hereof.

                  18.      Effectiveness. This Amendment shall become effective
as of December 23, 2003 (the "Amendment Effective Date") only upon satisfaction
in full in the judgment of the Agent of each of the following conditions on or
prior to December 23, 2003:

                           (a)      Amendment. Agent shall have received three
         (3) original copies of this Amendment duly executed and delivered by
         Agent, Requisite Lenders and Borrower and acknowledged and agreed to by
         each of the Guarantors and Reflections.

                           (b)      Payment of Expenses. Borrower shall have
         paid to Agent all costs and expenses billed and owing in connection
         with this Amendment and the other Loan Documents and due to Agent
         (including reasonable legal fees and expenses).

                           (c)      Representations and Warranties. All
         representations and warranties contained in this Amendment shall be
         true and correct on and as of the Amendment Effective Date.

                           (d)      Amendment to Intercreditor and Subordination
         Agreement. Interactive and Paradigm shall have executed and delivered
         the First Amendment to Intercreditor and Subordination Agreement dated
         as of the date hereof.

                                       10
<PAGE>

                           (e)      Amended and Restated Loan Documents. The
         Credit Parties shall have executed and delivered the Amended and
         Restated Security Agreement, the Amended and Restated Pledge Agreement
         and the Amended and Restated Intellectual Property Security Agreement
         each dated as of the date hereof.

                           19.      GOVERNING LAW. EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED IN ANY OF THE LOAN DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS OF
CONSTRUCTION, VALIDITY AND PERFORMANCE, THE LOAN DOCUMENTS AND THE OBLIGATIONS
SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN THAT STATE AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
EACH CREDIT PARTY HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS
LOCATED IN NEW YORK COUNTY, CITY OF NEW YORK, NEW YORK SHALL HAVE EXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THE CREDIT
PARTIES, AGENT AND LENDERS PERTAINING TO THIS AMENDMENT OR ANY OF THE OTHER LOAN
DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR RELATING TO THIS AMENDMENT OR ANY
OF THE OTHER LOAN DOCUMENTS; PROVIDED, THAT AGENT, LENDERS AND THE CREDIT
PARTIES ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A
COURT LOCATED OUTSIDE NEW YORK COUNTY AND; PROVIDED, FURTHER THAT NOTHING IN
THIS AMENDMENT OR ANY OF THE OTHER LOAN DOCUMENTS SHALL BE DEEMED OR OPERATE TO
PRECLUDE AGENT FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER
JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE
OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF AGENT.
EACH CREDIT PARTY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION
IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH CREDIT PARTY HEREBY
WAIVES ANY OBJECTION THAT SUCH CREDIT PARTY MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT. EACH CREDIT PARTY HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS,
COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT
SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED
OR CERTIFIED MAIL ADDRESSED TO SUCH CREDIT PARTY AT THE ADDRESS SET FORTH IN
ANNEX I OF THE CREDIT AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED
COMPLETED UPON THE EARLIER OF SUCH CREDIT PARTY'S ACTUAL RECEIPT THEREOF

                                       11
<PAGE>

OR 3 BUSINESS DAYS AFTER DEPOSIT IN THE UNITED STATES MAILS, PROPER POSTAGE
PREPAID.

                           20.      Counterparts. This Amendment may be executed
by the parties hereto on any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.

                                       12
<PAGE>

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

                                       ATARI, INC.

                                       By: /s/ David Fremed
                                          --------------------------------------
                                       Name:  David Fremed
                                       Title: Senior Vice President, Finance
                                               Chief Financial Officer

                                       GENERAL ELECTRIC CAPITAL
                                       CORPORATION, as Agent and Lender

                                       By: /s/ Christopher Cox
                                          --------------------------------------
                                       Name: Christopher Cox
                                       Its: Duly Authorized Signatory

                       [SIGNATURES CONTINUED ON NEXT PAGE]

<PAGE>

The undersigned Credit Party hereby
acknowledges, agrees and consents to the
amendment to the Credit Agreement
effected by this Amendment.

ACKNOWLEDGED, CONSENTED and
AGREED to as of the date first written
above.

REFLECTIONS INTERACTIVE LIMITED

By:  /s/ Harry M. Rubin
    ------------------------------
Name: Harry M. Rubin
Title: Director

<PAGE>

The undersigned hereby acknowledges,
agrees and consents to the amendment to the
Credit Agreement effected by this
Amendment.

ACKNOWLEDGED, CONSENTED and
AGREED to as of the date first written
above.

ATARI INTERACTIVE, INC.

By:  /s/ Lisa S. Rothblum
    ------------------------------
Name:  Lisa S. Rothblum
Title: Secretary

PARADIGM ENTERTAINMENT, INC.

By:  /s/ Lisa S. Rothblum
    ------------------------------
Name:    Lisa S. Rothblum
Title: Secretary