Document:

<PAGE>

                                                                    Exhibit 10.2

                               FIRST AMENDMENT TO
                    INTERCREDITOR AND SUBORDINATION AGREEMENT

                  FIRST AMENDMENT, dated as of December 23, 2003 (this
"Amendment"), to the Intercreditor and Subordination Agreement referred to below
among INFOGRAMES ENTERTAINMENT SA, a company organized under the laws of France
("Parent"), CALIFORNIA US HOLDINGS, INC., a California corporation ("CUSH",
together with Parent and any other holder of the Subordinated Obligations, from
time to time, collectively, the "Subordinated Noteholder"), ATARI INTERACTIVE,
INC., formerly known as INFOGRAMES INTERACTIVE, INC., a Delaware corporation
("Interactive"), and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware
corporation, as agent (in such capacity, the "Senior Agent") for the lenders
from time to time party to the Senior Credit Agreement (the "Senior Lenders" and
together with the Senior Agent and their respective successors and assigns, the
"Senior Creditors"), and the CREDIT PARTIES SIGNATORY HERETO.

                               W I T N E S S E T H

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

                  WHEREAS, the Senior Credit Agreement is being amended
simultaneously herewith to release Interactive and Paradigm as Credit Parties
thereto;

                  WHEREAS, pursuant to the Senior Credit Agreement, Interactive
and Paradigm are required to become parties to the Intercreditor Agreement;

                  WHEREAS, pursuant to an Agreement, dated as of September 24,
2003, among Parent, CUSH, Borrower and the Senior Agent, each of Parent and
Holdings, among other things, (i) agreed and acknowledged that all outstanding
Subordinated Obligations pursuant to the Subordinated Credit Agreement, the
Subordinated Secured Notes and the Subordinated Convertible Notes, together with
any other documents or instruments relating thereto (as amended, restated,
modified or supplemented, the "Terminated Parent Subordinated Debt Agreements")
have been paid and satisfied in full and were terminated (the "Satisfied
Subordinated Obligations"); (ii) terminated and released the Parent Second Lien
and any other security interest or liens on any property or assets of any Credit
Party or any other Person securing the Satisfied Subordinated Obligations; and
(iii) covenanted and agreed that neither the Borrower nor any other Credit Party
has any right to incur any additional Indebtedness under the Terminated Parent
Subordinated Debt Agreements nor any further liability or obligation under the
Terminated Parent Subordinated Debt Agreements; and

                  WHEREAS, Subordinated Noteholder, Interactive, Paradigm,
Senior Agent and the Credit Parties have agreed to amend the Intercreditor
Agreement in the manner, and on the terms and conditions, provided for herein;

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                  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 Intercreditor Agreement.

                  2. Amendment to Section 1 of the Intercreditor Agreement.
Section 1 of the Intercreditor Agreement is hereby amended by (a) deleting the
definitions of "Shiny Notes", "Subordinated Convertible Notes" and "Subordinated
Secured Notes", and (b) deleting the definition of "Subordinated Credit
Agreement" and the references to such term in the definitions of "Subordinated
Note Documents" and "Subordinated Obligations."

                  3. Amendment to Section 1 of the Intercreditor Agreement.
Section 1 of the Intercreditor Agreement is hereby amended by amending and
restating the following definitions in their entirety as follows:

         "`Distribution Agreement' shall mean, collectively, the Distribution
           Agreement dated as of October 2, 2000 between Borrower (as successor
           in interest to GT Interactive Software Corp.) and the Parent and
           Infogrames Europe SA, as supplemented by that certain side letter
           among Parent, Borrower and Interactive dated as of November 12, 2002.

          `Guarantors' shall mean each Person, if any, that executes a guaranty
           or other similar agreement on or after the Sixth Amendment Effective
           Date in favor of Senior Creditors, in connection with the
           transactions contemplated by the Senior Loan Documents, and their
           respective successors and assigns.

          `Minimum Availability Requirement' shall mean, with respect to any
           proposed payments under Section 3.1(ii), satisfaction of each of the
           following conditions: (i) Availability at any time during the
           ninety-day period immediately preceding the date of such payment
           shall not be less than $30,000,000 for any three consecutive days,
           (ii) on the date of such payment and after giving effect thereto,
           Availability shall not be less than $30,000,000, and (iii)
           Availability at any time during the four-month period immediately
           succeeding the date of such payment shall be projected to be no less
           than $30,000,000, as set forth in projections prepared by Borrower
           and reasonably acceptable to Senior Agent.

          `Subordinated Intercompany Loan' means any loan from Subordinated
           Noteholder to any Credit Party.

          `Subordinated Noteholder' shall mean Parent, CUSH, Interactive,
           Paradigm, and any other holder of the Subordinated Obligations, from
           time to time.

          `Subordinated Notes' shall mean the Subordinated Intercompany Notes.

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

                  4. Amendment to Section 3.1 of the Intercreditor Agreement.
Clauses (iii), (iv) and (v) of Section 3.1 of the Intercreditor Agreement are
hereby deleted in their entirety, and clauses (i) through (ii) of Section 3.1 of
the Intercreditor Agreement are amended and restated in their entirety to read
as follows:

         "(i)     payments in respect of Ordinary Course Intercompany
         Obligations made in the ordinary course of business and without
         acceleration of the due date thereof or prepayment; and

         (ii)     other payments in respect of the Subordinated Obligations (in
         addition to those payments permitted under the foregoing clause (i)),
         quarterly, on a date that is not prior to ten Business Days after, nor
         later than 15 Business Days after, the date on which the Financial
         Statements for the immediately preceding Fiscal Quarter are delivered
         to the Senior Lenders in accordance with Annex E of the Senior Credit
         Agreement, provided, that either:

         (1)      in the case of any payment made on a date on which the Minimum
         Availability Requirement is not satisfied, then (a) the amount of such
         payment does not exceed the Maximum Excess Cash Flow Amount for the
         immediately preceding four Fiscal Quarters less the amount of any
         payments made under clause (ii) of this Section 3.1 for the immediately
         preceding four Fiscal Quarters, (b) no Default or Event of Default
         shall have occurred and be continuing or would result after giving
         effect to any such payment, (c) at any time during the thirty-day
         period immediately preceding the date of such payment, Availability
         shall not be less than $20,000,000 for any five consecutive days, (d)
         on the date of such payment and after giving effect thereto
         Availability shall not be less than $20,000,000, (e) Availability at
         any time during the three-month period immediately succeeding the date
         of such payment shall be projected to be no less than $20,000,000, as
         set forth in projections prepared by Borrower and reasonably acceptable
         to Senior Agent, (f) Borrower and Guarantors shall have on a combined
         basis at the end of such Fiscal Quarter, a Fixed Charge Coverage Ratio
         for the 12-month period then ended of not less than 1.75:1.00,
         calculated on a pro forma basis as if such payment were made during
         such period, and (g) at least 10 Business Days prior to the date of
         such payment, Senior Agent shall have received a certificate signed by
         Borrower's chief financial officer certifying compliance with the
         foregoing conditions and the manner in which such payment has been
         calculated, including projections required under the foregoing clause
         (e), and a calculation of the applicable Fixed Charge Coverage Ratio
         and a calculation of Excess Cash Flow, which certificate shall be in
         form and substance reasonably satisfactory to Senior Agent; or

          (2) in the case of any payment made on a date on which the Minimum
          Availability Requirement is satisfied, then (a) no Default or Event of
          Default

                                       3
<PAGE>

         shall have occurred and be continuing or would result after giving
         effect to any such payment (including any breach of any Financial
         Covenant set forth in Annex G to the Senior Credit Agreement that would
         have resulted if such payment had been made during the previous Fiscal
         Quarter), and (b) at least 10 Business Days prior to the date of such
         payment, Senior Agent shall have received a certificate signed by
         Borrower's chief financial officer certifying compliance with the
         foregoing conditions and the manner in which such payment has been
         calculated, which certificate shall be in form and substance reasonably
         satisfactory to Senior Agent."

                  5. Amendment to Section 6.3 of the Intercreditor Agreement.

                  (a)      Section 6.3(a) of the Intercreditor Agreement is
hereby amended and restated in its entirety to read as follows:

         "(a)     permit to exist any Lien on any property or assets of any
         Credit Party to secure or provide for payment or performance of the
         Subordinated Obligations;"

                  (b)      Section 6.3 of the Intercreditor Agreement is hereby
                  further amended by deleting the "or" at the end of subsection
                  (b), deleting the period at the end of subsection (c) and
                  replacing it with a semicolon followed by the word "or", and
                  adding the following as subsection (d):

         "(d)     permit the Trademark License Agreement to be amended,
         modified, waived or supplemented."

                  6.       Joinder of Interactive and Paradigm. Each of
Interactive and Paradigm hereby join the Intercreditor Agreement and agree to
become a Subordinated Noteholder under the Intercreditor Agreement and to comply
with and be bound by all of the terms, conditions and covenants of the
Intercreditor Agreement as applicable to it as a Subordinated Noteholder.

                  7.       Representations and Warranties of Subordinated
Noteholder. Subordinated Noteholder hereby represents and warrants that:

                  (a)      Subordinated Noteholder has the power and authority
         and the legal right to execute and deliver and to perform its
         obligations under this Amendment and to perform its obligations under
         the Intercreditor Agreement as amended by this Amendment (the "Amended
         Intercreditor Agreement"); and

                  (b)      this Amendment constitutes a legal, valid and binding
         obligation of Subordinated Noteholder.

                  8.       Representations and Warranties of Senior Agent.
Senior Agent hereby represents and warrants that:

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                  (a)      Senior Agent has the power and authority and the
         legal right to execute and deliver and to perform its obligations under
         this Amendment and to perform its obligations under the Amended
         Intercreditor Agreement;

                  (b)      this Amendment constitutes a legal, valid and binding
         obligation of the Senior Agent.

                  9.       Ratification of Intercreditor Agreement; Remedies.
Except as expressly provided for, and on the terms and conditions set forth,
herein, the Intercreditor Agreement 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 the Intercreditor Agreement by any party thereto with respect to any right or
remedy which any party may now or in the future have under the Intercreditor
Agreement, at law or in equity or otherwise or be deemed to prejudice any rights
or remedies which any party may now have or may have in the future under or in
connection with the Intercreditor Agreement. The Intercreditor Agreement is
hereby in all respects ratified and confirmed.

                  10.      Guaranty. Each of parties hereto agrees and
acknowledges that as of the date hereof, after giving effect to the Sixth
Amendment, the Guaranty has been terminated and is of no further force or
effect.

                  11.      GOVERNING LAW. THIS AMENDMENT AND THE OBLIGATIONS
ARISING HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND
PERFORMED IN SUCH STATE, AND ANY APPLICABLE LAWS OF THE UNITED STATES OF
AMERICA.

                  12.      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.

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<PAGE>

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

                                          Senior Agent:

                                          GENERAL ELECTRIC CAPITAL
                                          CORPORATION, as Agent

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

                                          Subordinated Noteholder:

                                          INFOGRAMES ENTERTAINMENT SA,
                                          for itself and each Subsidiary thereof

                                          By: /s/ Frederic Chesnais
                                              ----------------------------------
                                              Name: F. Chesnais
                                              Title: Directeur General Delegue

                                          CALIFORNIA US HOLDINGS, INC.

                                          By: /s/ Frederic Chesnais
                                              ----------------------------------
                                              Name: F. Chesnais
                                              Title: Attorney-in-Fact

                                          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

<PAGE>

                                    Credit Parties:

                                    ATARI, INC.

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

                                    REFLECTIONS INTERACTIVE LIMITED

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

                                                                   EXHIBIT 10.65

                        BALDWIN TECHNOLOGY COMPANY, INC.
                     MANAGEMENT INCENTIVE COMPENSATION PLAN

                            as summarized on 8/11/03
                          as amended, effective 1/1/04

OBJECTIVE:

The Baldwin Management Incentive Compensation Plan (MICP or Bonus Plan) is
designed to reward, recognize and motivate executives and key management
employees for their contributions on a corporate-wide, functional and personal
basis.

PLAN CRITERIA:

The MICP is designed to provide each eligible participant a target bonus
percentage of his/her base salary upon the achievement of targeted financial and
personal performance objectives. For purposes of this plan, a participants base
salary will be that which is in effect on July 1st of any given fiscal year. For
the purposes of the MICP, the following financial performance objective will be
used as the basis to determine the level of payout under the Bonus Plan.

     1)   FINANCIAL PERFORMANCE OBJECTIVE (AOP TARGET) - For Fiscal 2004, the
          Company's Annual Operating Plan (AOP) net income before taxes will be
          used as the basis to determine achievement at both corporate and
          business unit levels.

PAY FOR PERFORMANCE RELATIONSHIP (LEVERAGING):

Performance against the financial objective will be rated on a scale of 100 -
120% of AOP target. There will be no payout for achievement below 100% and the
maximum achievement is capped at 120% of the AOP target. The following chart
shows the % of target bonus opportunity yielded by performance leverage.

<TABLE>
<CAPTION>
Performance Against               % of Target
   AOP Target                  Bonus Opportunity
<S>                            <C>
    100%                            100%
    110%                            125%
    120%                            150%
</TABLE>

BONUS FORMULA:

A participants actual bonus payout (except for corporate participants) will be
based on both the consolidated and the participant's business unit net income
before taxes. For Fiscal 2004, all participants (except corporate participants)
will have their 100% target bonus opportunity weighted at 50% from consolidated
net income before tax and 50% from their business unit's net income before tax
(corporate participants will be based 100% on consolidated net income before
tax). The final payout will be calculated by adding together the corporate and
business unit bonuses that have been separately calculated.

For example:

<PAGE>

Corporate net income TARGET is $1.0M             Business Unit net income TARGET
$400K
Corporate net income ACTUAL is $1.2M             Business Unit net income ACTUAL
$300K

<TABLE>
<S>                                      <C>
    Salary                               $100,000
    Bonus Eligibility                           30%
    100% bonus opportunity               $  30,000  (50%/50% split)
    150% bonus opportunity               $  45,000  (50%/50% split)

A)  50% from Corporate @ 100%            $  15,000
    Corporate Performance Leverage             120% (150% target bonus opportunity)

    Corporate Bonus Portion............                           $     22,500
                                                                  ------------
B)  50% from business unit @ 100%        $  15,000
    Bus Unit Performance Leverage               75% (0% target bonus opportunity)

    Business Unit Bonus Portion........                           $          0
                                                                  ------------
                                                     TOTAL BONUS  $     22,500
                                                                  ============
</TABLE>

ADMINISTRATIVE:

     1)   NEW PARTICIPANTS

          Any newly hired, promoted or transferred employee who becomes eligible
          to participate in the MICP will do so on a pro-rated basis from the
          date of such occurrence consistent with the time such participant
          worked in the fiscal year. All new participants must be approved by
          the President & CEO.

     2)   TERMINATION, RETIREMENT OR DEATH

          A participant who terminates voluntarily or is terminated for just
          cause (or summary dismissal) before the fiscal year end of the bonus
          plan year will not receive payment under this plan. In the case of
          retirement or death of a participant before the fiscal year end of the
          bonus plan year, payment will be made on a pro-rated basis consistent
          with the time such employee worked in the fiscal year.

     3)   CHANGE OF CONTROL

          In the event of involuntary separation of a participant due to a
          Change of Control before the fiscal year end of the Bonus Plan year,
          payment will be made on a pro-rata basis consistent with the time such
          participant worked during the fiscal year.

     4)   PAYOUT

          At fiscal year end, actual financial performance results will be
          compared to the performance criteria and the payout for each
          participant will be calculated. Any payout from the Plan will occur no
          later than August 15th following the end of the fiscal year.

<PAGE>

          In Fiscal 2004, in the event of a Change of Control, the Bonus Plan
          will make a payment to all participants who qualify for a bonus (as
          defined above) immediately prior to the closing date (i.e., the Change
          of Control event). The payout and any performance leverage that may
          have been earned will be based on the Company's actual performance
          versus its AOP target (net income before tax) for all completed
          quarters prior to the quarter in which the Change of Control event
          occurs.

          For the quarter in which the Change of Control event occurs, that
          quarter's AOP target will be divided by three (3) in order to arrive
          at a monthly AOP target for that quarter, against which the actual
          results will be measured to calculate the pro-rata share of the bonus
          payout as well as any performance leverage that may have been earned.
          For the avoidance of doubt, if a Change of Control event occurs during
          a month, the bonus and any performance leverage that may have been
          earned will be pro-rated up to the date of closing based on the actual
          results of the Company through the month ending just prior to the
          month in which the Change of Control event occurs.

     5)   PLAN CHANGES

          All information contained herein including the payout of bonuses under
          this Plan may be changed as considered appropriate at the sole
          discretion of the President and CEO of the Company, provided that
          changes to the Plan must be approved by the Compensation and Stock
          Option Committee of the Board of Directors of the Company.

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