ASSET PURCHASE AGREEMENT

Exhibit 10.1

ASSET PURCHASE AGREEMENT

by and among

UBISOFT HOLDINGS, INC.

and

UBISOFT ENTERTAINMENT LIMITED

as the Purchasers

and

ATARI, INC.

and

REFLECTIONS INTERACTIVE LIMITED

as the Sellers

Dated as of July 13, 2006

ASSET PURCHASE AGREEMENT

     This ASSET PURCHASE AGREEMENT (this “ Agreement ”) is made and dated as of July 13, 2006 (the “ Execution Date ”), by and among Ubisoft Holdings, Inc., a Delaware corporation (“ Holdings ”), a wholly-owned subsidiary of Ubisoft Entertainment S.A., a société anonyme , and Ubisoft Entertainment Limited, a company incorporated in the United Kingdom (“ Entertainment Limited ”) (Holdings and Entertainment Limited, referred to herein collectively as the “ Purchasers ”), and Atari, Inc., a Delaware corporation (“ Atari ”), which is a majority-owned subsidiary of Infogrames Entertainment, S.A. (“ Infogrames ”), a société anonyme , and Reflections Interactive Limited, a company incorporated in the United Kingdom (the “ Company ”), a wholly-owned subsidiary of Atari (the Company, referred to herein collectively with Atari as the “ Sellers ,” and the Sellers are sometimes referred to individually herein as a “ Seller ”). The Purchasers and the Sellers are collectively referred to as the “ Parties .”

RECITALS

     WHEREAS, the Company is engaged in the business of developing consumer entertainment software products;

     WHEREAS, the Sellers desire to sell, and the Purchasers desire to purchase, all or substantially all of the assets of the Company, and certain assets of Atari used in connection with the Company’s business and/or the Driver Games and Franchise, as hereinafter defined, and, in connection therewith, the Purchasers are willing to assume certain liabilities related to the Company’s business and/or the Driver Games and Franchise, in each case on the terms and conditions expressly set forth herein;

     WHEREAS, simultaneously with the closing of the transactions contemplated hereby, the Purchasers and the Sellers will enter into certain collateral agreements as provided herein; and

     WHEREAS, the Purchasers and the Sellers desire to make certain representations, warranties, covenants and agreements in connection with this Agreement.

     NOW, THEREFORE, in consideration of the mutual promises hereinafter set forth and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereby agree as follows:

ARTICLE I
CERTAIN DEFINITIONS

     For purposes of this Agreement, unless defined in this Article I, capitalized terms shall have the meaning assigned to them elsewhere herein:

     “ Acquired Assets ” shall have the meaning assigned to it in Section 2.1(a) .

     “ Acquired Contracts ” shall have the meaning assigned to it in Section 3.6 .

     “ Acquired Future Revenues ” shall mean the amounts to be paid and/or accounts receivable of the Sellers that accrue under Acquired Contracts after the applicable Sell-Off Period set forth in Section 5.1(e) and Section 5.1(f) , which are listed in Section 2.1(a)(i) and (ii) of the Disclosure Schedule, and which are not related to the allowed sale of Inventory of the Sellers with respect to the Games. By way of example, but not limitation, any advances, guarantee payments or royalties that Sorrent, now known as Glu Mobile, would have paid to the Sellers after the applicable Sell-Off Period shall now be paid directly to the Purchasers or their assignees by Sorrent, now known as Glu Mobile, as part of the Acquired Future Revenues. For the sake of clarification, any and all revenues from the Driver Games and Franchise movie rights (e.g., Constantin Agreements) shall not be deemed part of the Acquired Future Revenues hereunder, but shall be deemed part of the Acquired Assets which are not subject to any Sell-Off Period and which are directly due and payable to the Purchasers on or after the Closing.

     “ Acquisition Proposal ” shall mean (a) any proposal for a merger or other business combination involving the Company or any proposal or offer to acquire in any manner, directly or indirectly, an equity interest in the Company or any voting securities of the Company, unless the acquirer of the equity interest or voting securities agrees to cause the Company to fulfill its obligations under this Agreement, or a substantial portion of the assets of the Company (other than in the ordinary course of business) or (b) directly or indirectly, in any way, contact, initiate, enter into, or conduct any discussions or negotiations, or enter into any agreements, whether written or oral, with any Person with respect to a transaction of the type described in clause (a) or any other transaction that would interfere with the sale of any of the Acquired Assets in the Contemplated Transaction.

     “ Affiliate ” shall mean, when used with reference to any specified Person, any other Person that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with the Person specified, except that for the purposes of any requirement that the Sellers and their Affiliates take or not take an action, the term Affiliate will not include Infogrames Entertainment S.A. or its subsidiaries.

     “ Assumed Liabilities ” shall have the meaning assigned to it in Section 2.2(a) .

     “ Bill of Sale ” shall mean that certain Bill of Sale, Assignment and Assumption Agreement to be executed by the Sellers and the Purchasers concurrently with the Closing as provided in Section 2.9(a)(i) .

     “ Business Day ” shall mean any day other than Saturdays, Sundays and days when commercial banks are authorized to be closed in New York, New York or Paris, France.

     “ Closing Date ” shall have the meaning assigned to it in Section 2.9(a) .

     “ Company’s Business ” shall mean the Company’s business of developing certain consumer entertainment software products, including but not limited to the Driver Games and Franchise, as defined below; provided, however, the Company’s Business does not include the “Transporter” licensed videogame.

     “ Consents ” shall mean all consents required under this Agreement, including, but not limited to, Consents that may be required under the terms of the Acquired Contracts in order for such Acquired Contracts to be conveyed or assigned to the Purchasers or Consents that may be required so that the Purchasers may fully exploit the Acquired Assets.

     “ Contemplated Transactions ” shall mean the purchase of the Acquired Assets and assumption of the Assumed Liabilities as per this Agreement and the Related Agreements.

     “ Contracts ” shall mean contracts, undertakings, commitments or agreements, including Acquired Contracts and Retained Contracts.

     “ Copyrights ” shall mean U.S. and foreign copyrights whether registered or unregistered, and pending applications to register the same, including but not limited to the items listed in Section 3.8(a) of the Disclosure Schedule.

     “ Driver Games and Franchise ” shall mean (a) the actual action-driving video games consisting of Driver, Driver 2, Driv3r and Driver: Parallel Lines (Driver 4) (all versions thereof, languages and platforms) that have been developed, produced, licensed, manufactured and/or sold by the Sellers, their Affiliates or sublicensees (each a “ Game ” and collectively, the “ Games ”), and any and all versions (existing or under development), sequels, prequels, and derivatives thereof, in any language for any and all platforms now known or hereinafter devised, and (b) all Software and Intellectual Property Rights, Tangible Personal Property, Contracts and other rights thereto, which include, without limitation, the Source Code, Tools, Technology and Engines, Copyrights, Trademarks and Service Marks, Internet Domain Names, patent rights, trade secrets, videogame, mobile, wireless, music, worldwide motion picture, television and analogous and allied rights to the Games.

     “ Escrow Agreement ” shall mean that certain Escrow Agreement to be executed by the Sellers and the Purchasers and an escrow agent (“ Escrow Agent ”) concurrently with the Closing as provided in Section 2.9(a)(iii) .

     “ Execution Date ” shall mean the date first written on the first page of this Agreement.

     “ GAAP ” shall mean generally accepted accounting principles for financial reporting in the United States for Atari and the United Kingdom for the Company, as in effect from time to time.

     “ Gold Masters ” shall mean all of the actual physical master disks of the Games from which finished Games playable by end users may be manufactured.

     “ Governmental Body ” shall mean any: (a) nation, state, county, city, town, borough, village, district or other jurisdiction; (b) federal, state, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any agency, branch, department, board, commission, court, tribunal or other entity exercising governmental or quasi-governmental powers); (d) multinational organization or body; (e) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory or taxing authority or power; or (f) official of any of the foregoing.

     “ Insurance ” shall have the meaning set forth in Section 2.1(b)(vii) .

     “ Intellectual Property Rights ” shall mean all U.S. and foreign intellectual property and related intellectual property rights, whether registered or unregistered, including, without limitation, patents, patent applications, continuations, continuations-in-part, divisions, reissues, patent disclosures, inventions (whether or not patentable) or improvements thereto; Trademarks and Service Marks in any jurisdiction, Internet Domains Names, Copyrights, franchises, licenses, know-how, trade secrets, concepts, methods, reports, data, processes and formulae; Source Code and object code, algorithms, architectures, structures, display screens, layouts, inventions, Tools, Technology and Engines and other development tools; and all documentation and media constituting, describing or relating to the above, including, without limitation, manuals, memoranda and records.

     “ Internet Domain Names ” shall mean internet domain names and website addresses, whether registered or unregistered, including but not limited to the items listed in Section 3.8(a) of the Disclosure Schedule.

     “ Inventory ” shall mean all inventories of the Games manufactured or ordered by the Sellers or their Affiliates, wherever located, warehoused or in process.

     “ Later Assumed Liabilities ” shall have the meaning assigned to it in Section 2.2(b) .

     “ Leased Equipment ” shall have the meaning set forth in Section 5.9 .

     “ Legal Requirement ” shall mean any federal, state, local, municipal, foreign, international, multinational or other constitution, law, ordinance, principle of common law, code, regulation, statute or treaty.

     “ Licensed Software ” shall mean the Software where the Intellectual Property Rights are licensed to the Sellers and which is used or usable in connection with the Company’s Business and/or the Driver Games and Franchise.

     “ Lien ” shall mean any mortgage, pledge, assessment, security interest, lease, lien, adverse claim, levy, charge, attachment, any title defect, hypothecation or other encumbrance of any kind, or any conditional sale Contract, title retention Contract or other Contract to give any of the foregoing.

     “ Material Adverse Effect ” or “ Material Adverse Change ” means, in connection with any Person, any event, change or effect that is materially adverse, individually or in the aggregate, to the condition (financial or otherwise), properties, assets, liabilities, revenues, income, business, operations, results of operations or prospects of such Person. In addition, the Sellers’ distribution of the Games’ Inventory at wholesale and/or retail prices that are reduced below the levels of discounted or promotional pricing that Atari customarily offers in marketing products similar to the Games shall constitute dumping and shall be deemed a Material Adverse Change upon the Acquired Assets to the detriment of the Purchasers for the purposes of this Agreement.

     “ Owned Software ” shall mean the Software wherein the Intellectual Property Rights are owned by the Sellers and the Software was used, is used, or is usable primarily in connection with the Company’s Business and/or the Driver Games and Franchise.

     “ Order ” shall mean any order, injunction, judgment, writ, decree, consent decree, ruling, assessment or arbitration award of any Governmental Body or arbitrator.

     “ Person ” shall mean a person, corporation, société anonyme , association, partnership, limited liability company, joint venture, trust or other entity or organization.

     “ Personal Property Leases ” shall have the meaning set forth in Section 2.2(a)(ii) .

     “ Proceeding ” shall mean any action, arbitration, audit, hearing, investigation, litigation or suit (whether civil, criminal, administrative, judicial or investigative, whether formal or informal, whether public or private), threatened or actual, commenced, brought, conducted or heard by or before, or otherwise involving, any Governmental Body or arbitrator.

     “ Related Agreements ” shall mean, collectively, the Bill of Sale, Assignment of Trademark and Service Marks, Assignment of Internet Domain Names, Assignment of Copyrights, and the Escrow Agreement.

     “ Retained Accounts Receivable ” shall have the meaning set forth in Section 2.1(b)(iv) .

     “ Retained Assets ” shall have the meaning set forth in Section 2.1(b) .

     “ Retained Books and Records ” shall have meaning set forth in Section 2.1(b)(viii) .

     “ Retained Cash ” shall have the meaning set forth in Section 2.1(b)(v) .

     “ Retained Contracts ” shall have the meaning set forth in Section 2.1(b)(iii) .

     “ Retained Intellectual Property Rights ” shall have the meaning set forth in Section 2.1(b)(ii) .

     “ Retained Inventory Liabilities ” shall have the meaning set forth in Section 2.2(c) .

     “ Retained Liabilities ” shall have the meaning set forth in Section 2.2(c) .

     “ Retained Tangible Personal Property ” shall have the meaning set forth in Section 2.1(b)(i) .

     “ Software ” shall mean computer software, including both Owned Software and Licensed Software, and subsequent versions thereof, including Tools, Technology and Engines, Source Code, object, executable or binary code, objects, drivers, utilities, comments, screens, user interfaces, report formats, templates, menus, buttons, icons, designs, graphics, art assets and models, and all files, data, materials, manuals, design notes and other items and documentation related thereto or associated therewith.

     “ Source Code ” shall mean all source code, in machine and human readable form, to the Games, Tools, Technology and Engines.

     “ Tangible Personal Property ” shall mean tangible personal property and interests therein, including all Leased Equipment, machinery, equipment, furniture and furnishings, tools, office equipment, computer hardware and software (other than Owned Software or Licensed Software), Gold Masters, office supplies, materials, and other items of tangible personal property of every kind owned by the Sellers that is used in the operation or conduct of the Company’s Business or with respect to the Driver Games and Franchise (wherever located and whether or not carried on the Sellers’ books), together with any express or implied warranty by the manufacturers or sellers or lessors of any item or component part thereof and all maintenance records and other documents relating thereto, unless part of the Retained Assets.

     “ Tax ” or “ Taxes ” shall mean all taxes, charges, fees, levies, duties, imposts or other assessments or charges imposed by and required to be paid to any federal, state, local or foreign taxing authority, including, without limitation, income, excise, property, sales, use, transfer, gains, ad valorem or value added, stamp, payroll, windfall, profits, gross receipts, employment, withholding, social security, workers’ compensation, unemployment compensation, documentation, license, registration, customs duties, tariffs, net worth and franchise taxes (including any interest, penalties or additions attributable to or imposed on or with respect to any such assessment) and any estimated payments or estimated taxes.

     “ Tax Return ” shall mean any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

     “ Tools, Technology and Engines ” shall mean all tools, technology and engines used in the Games and in the development of the Games.

     “ Trademarks and Service Marks ” shall mean all trademarks, service marks, trade dress and trade names including all other assumed or fictitious names which are or have been used by the Company and/or Atari wholly or primarily with the Driver Games and Franchise, whether registered or unregistered, and pending applications to register the foregoing, including but not limited to the items listed in Section 3.8(a) of the Disclosure Schedule; provided, that this definition of Trademarks and Service Marks does not include the “Atari” mark, trade names and trade dress in and of themselves.

     “ TUPE ” shall mean Transfer of Undertakings (Protection of Employment) Regulations 2006 pursuant to The Acquired Rights Directive (Directive No. 77/187/EEC).

ARTICLE II
ASSET PURCHASE AND SALE; THE CLOSING

     2.1 Acquired Assets and Retained Assets .

          (a) At the closing of the Contemplated Transactions (the “ Closing ”), the Sellers shall sell, transfer, convey, assign and deliver to the Purchasers, and the Purchasers shall purchase and acquire all of the Sellers’ rights, title and interest in and to the tangible and intangible assets of the Company’s Business, other than the Retained Assets, and the Driver Games and Franchise (the “ Acquired Assets ”). Without limitation, the Acquired Assets specifically shall include:

          (b) Retained Assets . Notwithstanding Section 2.1(a)(ii) , the assets that are specifically listed in Section 2.1(b) of the Disclosure Schedule (collectively, the “ Retained Assets ”) are excluded from the Acquired Assets and shall be retained by the Sellers. The Retained Assets shall include only the following:

     2.2 Assumed Liabilities; Later Assumed Liabilities; Retained Liabilities .

          (a) Assumed Liabilities . At the Closing, the Purchasers shall assume only those specific liabilities and obligations of the Sellers that are listed in Section 2.2(a) of the Disclosure Schedule (collectively, the “ Assumed Liabilities ”). As part of the Assumed Liabilities in Section 2.2(a) of the Disclosure Schedule, the Purchasers shall assume the following specific items:

          (b) Later Assumed Liabilities . Twelve (12) months after the Closing Date, the Purchasers shall assume those specific financial liabilities (but only those specific financial liabilities) that (i) are associated with the use in Driver: Parallel Lines of specific musical compositions and/or sound recordings for which agreements have not been executed by that time, and/or (ii) relate to or arise out of the mechanical rights thereto, which will be set forth in Section 2.2(b) of the Disclosure Schedule prior to Closing and updated each calendar quarter (with accompanying delivery of all related contracts executed during the previous quarter) during the twelve (12) month period, with a final update to be delivered by the Sellers within thirty (30) days after the end of the twelve (12) month period (the “ Later Assumed Liabilities ”), but only in the event and to the extent that such Later Assumed Liabilities are not discharged or paid in full by the Sellers within twelve (12) months after the Closing Date (subject to Sellers providing satisfactory evidence of a discharge letter or payment); provided, that the aggregate financial number in the Later Assumed Liabilities shall not exceed £300,000 (or, the United States Dollar conversion of such limit of £300,000, which shall be based upon the noon buying rate in London on the Closing Date as reported by Reuters). It is further provided that Purchasers shall have the right to funds from the Holdback Funds that are equivalent to the Later Assumed Liabilities which shall be held as part of the Holdback Funds in escrow for twelve (12) months after the Closing Date. If there are insufficient funds in the Holdback Funds to cover the Later Assumed Liabilities, then Sellers shall make Purchasers whole in cash as per Section 2.3(a)(ii) and Section 6.4 . It is further provided that the Sellers shall use all commercially reasonable efforts to (i) discharge or pay in full all Later Assumed Liabilities during the foregoing twelve (12) month

period, and (ii) execute the related contracts. In discharging these Later Assumed Liabilities, the Sellers shall use their best efforts to ensure that all related contracts shall be flat fees with full buy-outs and payments for all mechanical rights. Where the Sellers have discharged or paid in full such Later Assumed Liabilities, the Sellers shall then assign the fully executed related contracts to the Purchasers via written notice to the Purchasers and the applicable third party contract holders. These later assigned contracts shall be deemed to be Acquired Contracts hereunder.

          (c) Retained Liabilities . Except for the Assumed Liabilities, the Purchasers shall not assume, or be deemed to assume, under this Agreement or otherwise by reason of the Contemplated Transactions, any other liabilities, obligations or commitments of the Sellers of any nature whatsoever, including, but not limited to, any liability or obligation of the Sellers listed in Section 2.2(c) of the Disclosure Schedule and Retained Inventory Liabilities (as defined herein) (collectively, the “ Retained Liabilities ”). For the sake of clarification, the Sellers shall be responsible for any and all Retained Liabilities, including, but not limited to, any and all liabilities, payable debts, amounts due and obligations that have been incurred, undertaken, ordered or otherwise engaged by the Sellers with respect to the Driver Games and Franchise and Company’s Business prior to Closing (this includes payments for all milestones approved by Sellers regardless of whether such have been invoiced to Sellers, including, but not limited to, Milestone 7 (May), Milestone 8 (June) and Milestone 9 (July) for the PSP Driver game; and further, Sellers shall not unreasonably withhold or delay Sellers’ approval of milestones), which if not discharged or paid in full prior to Closing shall be part of the Retained Liabilities after Closing. The Sellers shall discharge in a timely manner any and all of the Retained Liabilities that in any way affect the Acquired Assets and in such a manner so the Acquired Assets are not damaged or their use or enjoyment prejudiced or infringed upon in any manner. Failure to do so will be a Material Adverse Change for the Purchasers and any damages, losses, expenses, costs or attorneys’ fees shall be deemed Purchasers’ Losses. Without limiting what is said in the preceding sentence, the Sellers shall be responsible for: (i) all the financial liabilities (A) associated with the use in Driver: Parallel Lines of specific musical compositions and/or sound recordings and/or (B) arising out of or relating to the mechanical rights thereto under the agreements set forth in Section 2.2(b) of the Disclosure Schedule (the “ Retained Music Liabilities ”) unless they become Later Assumed Liabilities; provided, however, that any and all Retained Music Liabilities (including, but not limited to, undischarged mechanical rights costs) as of the end of the twelve (12) month period after the Closing Date that exceed the limit of £300,000 shall remain Sellers’ sole responsibility and liability; for (ii) all salaries and wages (including taxes, vacation and sick pay) accrued and unpaid as of the close of business on the date before the Closing Date for the Company Employees listed in Section 2.1(a)(iii) of the Disclosure Schedule; and for (iii) each lease and sublease set forth on Section 3.16 of the Disclosure Schedule (including, without limitation, that certain lease with respect to the office building located at Central Square South, Orchard Street, New Castle, United Kingdom, hereinafter referred to as the “ Orchard Street Lease ”), except for those certain financial obligations that will belong to Purchasers pursuant to the agreement to sublease by and between Sellers and Purchasers with respect to the Orchard Street Lease (the “ Sublease Agreement ”). The Sellers

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shall be responsible for all liabilities associated with or belonging to all Inventory that the Sellers sell, distribute, place or otherwise move into the distribution channel relating to the Games, including all returns, price protections, markdowns and any other allowances or liabilities for such Inventory (collectively, the “ Retained Inventory Liabilities ”).

     2.3 Consideration .

          (a) Purchase Price . The consideration for the sale, transfer, conveyance, assignment and delivery to the Purchasers of the Acquired Assets shall consist of:

               (i) the assumption of the Assumed Liabilities; and

               (ii) a cash payment (“ Cash Payment ”) of Twenty-Four Million Dollars ($24,000,000) of which (A) Twenty-Two Million Dollars ($22,000,000) is attributable to the Intellectual Property Rights to the Acquired Assets, and (B) Two Million Dollars ($2,000,000) is attributable to all other items comprising the Acquired Assets (“ Allocations ”), which is defined as the “ Purchase Price ” and shall be determined for the Closing as follows:

                    Twenty-Four Million Dollars ($24,000,000) Cash Payment

                    less Two Million Four Hundred Thousand Dollars ($2,400,000), conveyed to the escrow agent pursuant to the terms of the Escrow Agreement (the “ Holdback Funds ”), as a holdback against the Sellers’ obligations under Sections 2.2(b) and 6.2 and the Excess Rent Amount (as defined in Section 2.4(a)(ii) below), to be released one hundred eighty (180) days from the Closing Date, subject to keeping sufficient funds in escrow as Holdback Funds to cover (i) the Later Assumed Liabilities in full for twelve (12) months from the Closing Date; (ii) any Disputed Claims (as defined in Section 6.3(a) below); and (iii) any Excess Rent Amount.

                    equals the portion of the Purchase Price, Twenty-One Million Six Hundred Thousand Dollars ($21,600,000), actually to be paid to Atari at the Closing.

The Purchase Price shall be adjusted again post-Closing for any amounts that may be released from the Holdback Funds to the Sellers, but the Allocations shall remain the same. The Purchasers shall have the right to have funds released from the Holdback Funds as per Section 2.2(b) and Section 6.4 .

          (b) Allocation . The Parties agree that in all Tax returns and other necessary filings they make, they will allocate the Purchase Price and the Assumed Liabilities among the Acquired Assets in accordance with the Allocations set forth in Section 2.3(a) and in accordance with Section 5.7 .

          (c) Value Added Tax (“VAT”)

               (i) The Sellers and the Purchasers consider and intend that the sale of the relevant Acquired Assets pursuant to this Section 2 is, for VAT purposes, a transfer as a going

concern (“TOGC”) of part of the business of the Company and that the provisions of Article 5 of the VAT (Special Provisions) Order 1995 shall apply.

               (ii) However in the event that HM Revenue and Customs in the United Kingdom determine that the sale of the relevant Acquired Assets does not comprise a TOGC, the Sellers and the Purchasers agree that the Purchase Price is inclusive of any required VAT (including, but not limited to, any penalties or interest that may be assessed) and that the Purchasers shall be deemed to have paid to the Sellers such VAT at the current rate thereof as the Sellers shall properly charge thereon and the Sellers shall provide the Purchasers with a receipted VAT invoice in respect thereof. In the event that there are Taxes (including, but not limited to, transfer Taxes) with respect to the assignment or transfer of any Acquired Assets or Assumed Liabilities that are located outside of the United Kingdom, such Taxes shall be borne by the Sellers.

     2.4 Condition of Execution .

          (a) Condition of Execution . Notwithstanding anything to the contrary contained herein, this Agreement shall not become effective and legally binding upon the Purchasers or the Sellers unless:

               (i) the Sellers deliver to the Purchasers a fully-executed Infogrames Letter Agreement, the form of which is attached hereto as Exhibit D, contemporaneously with the execution of this Agreement, or the Purchasers waive any requirement that the Sellers do so; and

               (ii) contemporaneously with the execution of this Agreement, the landlord (or its representative) with respect to the Orchard Street Lease (the “ Landlord ”) executes a Consent (the “ Landlord’s Consent ”) to the Purchasers entering into a sublease with the Sellers for the fifth (5 ^th ) floor (totaling approximately 15,000 square feet) of the premises for a period of one (1) year with an option to extend for six (6) months, on the same terms as presently exist under the Orchard Street Lease (which includes any rent increase contemplated under the Orchard Street Lease); provided, that in the event that the Purchasers exercise the option for a six (6) month extension, the Purchasers shall be entitled to receive from the Holdback Funds any required amount in excess (“ Excess Rent Amount ”) of an amount equal to fifty percent (50%) of the rent and service charges for the entire square footage under the Orchard Street Lease. The Sellers shall use best efforts to ensure Landlord’s consent (to be evidenced in the Landlord’s Consent) to Sellers’ covenants and obligations under Section 5.13 .

     2.5 Conditions Precedent to Closing .

          (a) Conditions to Obligations of All Parties . The respective obligations of the Parties under this Agreement shall be subject to the satisfaction prior to the Closing Date of the following conditions:

               (i)  Governmental Authorizations . All authorizations, consents, orders or approvals of, or declarations or filings with, or expirations of waiting periods imposed by, any governmental entity or TUPE, requisite to the Contemplated Transactions, shall have been filed, occurred or have been obtained, as the case may be.

               (ii)  No Restraining Orders or Proceedings . No temporary restraining order, preliminary or permanent injunction or other Order issued by any court of competent jurisdiction or other legal restraint or prohibition by any Governmental Body preventing, or Proceeding interfering with, the consummation of the Contemplated Transactions shall be in effect; provided , however , that prior to invoking this condition, each Party shall use its best efforts to have any such Order, injunction, legal restraint or prohibition or Proceeding vacated or dismissed.

               (iii)  Parking Sublease . At or prior to the Closing, the Purchasers and the Sellers will have entered into a sublease (the “ Parking Sublease ”) for five-ninths (5/9) of the parking spaces associated with the Orchard Street Lease, for a period of one (1) year with an option to extend for six (6) months, on the same terms as presently exist under the Sellers’ lease with Landlord therefor (which includes any rent increase contemplated thereunder). In the event that the Landlord does not consent to the Purchasers entering into the Parking Sublease with the Sellers, then the Parties shall waive the condition contained in this Section 2.5(a)(iii) , and the Purchasers shall receive from the Holdback Funds an amount equivalent to the rent that would be payable under the Parking Sublease for five-ninths (5/9) of the parking spaces associated with the Orchard Street Lease for a period of one (1) year (plus an additional six (6) months if the Purchasers choose a six (6) month extension), and any such amount shall be deemed to be part of the Excess Rent Amount.

          (b) Conditions Precedent to the Purchasers’ Obligations . The Purchasers’ obligations to effect the Contemplated Transactions shall be subject to the satisfaction (or waiver by the Purchasers) prior to or on the Closing Date of the following conditions:

               (i) Except to the extent such representations and warranties speak as of a specific date, the representations and warranties made by the Sellers in this Agreement shall be true in all material respects on and as of the Closing Date with the same effect as if such representations and warranties had been made or given on and as of the Closing Date, and the Purchasers shall have received a certificate of an officer of Atari to such effect. All representations and warranties of the Sellers in this Agreement shall be deemed reaffirmed and made by each of them as of the Closing Date;

               (ii) The Sellers shall have performed and complied in all material respects with all of their obligations and agreements required to be performed on or prior to the Closing Date under this Agreement, including all their obligations under Sections 2.6 and 2.9 , and the Purchasers shall have received a certificate of an officer of Atari to such effect;

               (iii) The Purchasers shall have received all documents required to be received from the Sellers on or prior to the Closing Date, including all the documents the Sellers are required to deliver in accordance with Section 2.9(a) in the respective forms attached hereto as Exhibits A through C.

               (iv) At or prior to the Closing, the Sellers shall have delivered to the Purchasers a Consent (“ THQ Consent ”) executed by THQ Inc. (“ THQ ”) and Atari, by which THQ shall have consented to the following amendment to that certain Technology License Agreement by and between Company, Paradigm Entertainment, Inc. ( “Paradigm ”), and Atari (“ Paradigm License Agreement ”): Entertainment Limited shall provide Atari with Upgrades (as defined in the Paradigm License Agreement) that may be developed by Entertainment Limited and technical support for the Licensed Technology (as defined in the Paradigm License Agreement) for Atari to provide to Paradigm, THQ or THQ’s Affiliates, for a period commencing on the Closing Date hereof and expiring on August 31, 2007; and thereafter, Purchasers shall have no further obligations under the Paradigm License Agreement. For the sake of clarification, Purchasers shall have no obligation to provide Paradigm, THQ or any of their respective Affiliates, as applicable, with any Upgrades developed by any of Entertainment Limited’s Affiliates. In the event that the Sellers are unable to deliver the THQ Consent as required hereunder, the Purchasers shall have the option to (a) terminate this Agreement pursuant to Section 2.7(b)(ii); or (b) waive the condition contained in this Section 2.5(b)(iv) , and have Entertainment Limited provide the foregoing Upgrades (as may be developed by Entertainment Limited) and technical support and charge the Sellers a service fee equal to Fifty Thousand Dollars ($50,000) per month that the first commercial release of the Stuntman II Game is delayed past August 31, 2007, until the earlier of such first commercial release or December 31, 2007.

               (v) The Sellers shall have delivered to the Purchasers an opinion of the Sellers’ counsel, in form and substance reasonably satisfactory to the Purchasers and their counsel, dated the Closing Date.

               (vi) The Audited Financials and Financial Statements, as defined in Section 3.13(a) , shall have been received by the Purchasers when due and the content thereof shall not have been determined to be inaccurate in any respect, and shall be satisfactory to the Purchasers, in their sole discretion;

               (vii) No Order issued by any Governmental Body or other legal restraint or prohibition preventing the consummation of the purchase of the Acquired Assets by the Purchasers shall be in effect, nor shall any Proceeding seeking any of foregoing be pending;

               (viii) There shall not be any action taken, or any Legal Requirement or Order enacted, entered, enforced or deemed applicable to the Contemplated Transactions which makes the consummation of the Contemplated Transactions illegal;

               (ix) At or prior to the Closing, the Sellers shall have either: (A) delivered evidence or copies of all required notices to, and all needed signed Consents (the form

of which has been approved and is satisfactory to the Purchasers), approvals or authorizations of or from, any Person that may be necessary to permit the consummation of the Contemplated Transactions, including, but not limited to, the THQ Consent, Consents for licenses and Contracts with third parties which are needed for such Contracts to be assigned to Purchasers as Acquired Contracts or as Contracts or licenses to be used by Purchasers, regardless as to whether the Contracts or licenses are assigned or not; or (B) delivered all Consents that Sellers have obtained as of the Closing and paid to Purchasers the dollar value, up to a total amount of £168,000, via check for Acquired Contracts for which the Sellers have not obtained Consents (and which shall become Retained Contracts) (the specific dollar value of each Acquired Contract requiring Consent is set forth on Section 2.1(b)(iii) of the Disclosure Schedule); provided, that the foregoing Section 2.5(b)(ix)(B) shall not be applicable to the THQ Consent and shall neither limit nor contravene Purchasers’ options under Section 2.5(b)(iv) in any manner.

               (x) At or prior to the Closing, each of the Related Agreements shall have been duly executed and delivered by the respective parties thereto;

               (xi) The Purchasers shall be satisfied that there is an absence of any Material Adverse Change in the Acquired Assets or operations of the Company, and that the Acquired Assets are free and clear of any Liens, claims or encumbrances;

               (xii) At or prior to the Closing, the Sellers settling all liabilities, payable debts, amounts due and obligations related to the Acquired Assets (this includes payments for all milestones approved by Sellers regardless of whether such have been invoiced to Sellers), including but not limited with regard to the Driver Games and Franchise and amounts due to Company Employees; and the Sellers shall have delivered evidence or copies of all signed amendments and letters of termination (the form of which has been approved and is reasonably satisfactory to the Purchasers) with respect to the OEM/Digital Distribution Contracts listed in Section 2.1(b)(iii) of the Disclosure Schedule that have been obtained by the Sellers, if any.

          (c) Conditions Precedent to the Sellers’ Obligations . The Sellers’ obligations to effect the Contemplated Transactions shall be subject to the satisfaction (or waiver by the Sellers) prior to or on the Closing Date of the following conditions:

               (i) Except to the extent such representations and warranties speak as of a specific date, the representations and warranties made by the Purchasers in this Agreement shall be true in all material respects on and as of the Closing Date with the same effect as if such representations and warranties had been made or given on and as of the Closing Date, and the Sellers have received a certificate of an officer of Holdings to such effect. All representations and warranties of the Purchasers in this Agreement shall be deemed reaffirmed and made by each of them as of the Closing Date;

               (ii) The Purchasers shall have performed and complied in all material respects with all of their obligations and agreements required to be performed prior to the

Closing Date under this Agreement, including all their obligations under Sections 2.6 and 2.9 , and the Sellers shall have received a certificate of an officer of Holdings to such effect;

               (iii) The Sellers shall have received all documents required to be received from the Purchasers on or prior to the Closing Date, including all the documents the Purchasers are required to deliver in accordance with Section 2.9(a) in the respective forms attached hereto as Exhibits A through C;

               (iv) The Purchasers shall deliver an opinion of the Purchasers’ counsel, in form and substance reasonably satisfactory to the Sellers and their counsel, dated the Closing Date.

               (v) No Order issued by any Governmental Body or other legal restraint or prohibition preventing the consummation of the purchase of the Acquired Assets by the Purchasers shall be in effect, nor shall any Proceeding seeking any of foregoing be pending;

               (vi) There shall not be any action taken, or any Legal Requirement or Order enacted, entered, enforced or deemed applicable to the Contemplated Transactions which makes the consummation of the Contemplated Transactions illegal;

               (vii) At or prior to the Closing, each of the Related Agreements shall have been duly executed and delivered by the respective parties thereto.

     2.6 Obligations and Conduct Prior to the Closing .

          (a) Business in the Ordinary Course . The Sellers shall, from the period of time commencing with the Execution Date and continuing until the earlier of the Closing Date or the Termination Time: (i) conduct the Company’s Business and operations only in the ordinary course; (ii) maintain all of the Company’s and the Games’ Intellectual Property Rights, Software (including, without limitation, Source Code and Tools, Technology and Engines), Tangible Personal Property and other rights and assets that will be Acquired Assets in good condition, working order, and repair (except for ordinary wear and tear); (iii) perform their respective obligations under all agreements binding upon them and maintain all of the Acquired Contracts, licenses and permits in good standing; (iv) continue in effect, all insurance policies or similar coverage; (v) keep employed and available all of the services of its current Company officers and Company Employees, but not hire any additional Company Employees; (vi) maintain and preserve the goodwill of the suppliers, customers, and others having business relations with the Sellers with respect to the Driver Games and Franchise; (vii) not take any action which will be deemed to cause a Material Adverse Change to the Driver Games and Franchise or the Company’s Business such as dumping Inventory; (viii) consult with the Purchasers, as necessary, with respect to any actual or proposed conduct of the Company’s Business; and (ix) Sellers and/or their Affiliates shall not enter into any distribution agreements or sublicensing agreements or arrangements for the Games from the Execution Date forward.

          (b) Standstill With Respect to New Agreements and Litigation . Before the earlier of the Closing Date or Termination, the Sellers shall not: (i) enter into any agreement(s) relating to the Acquired Assets, or renewals of any existing agreements, with any customers, new or existing, or extend the term of any existing agreements, or (ii) enter into any compromise or settlement of any litigation, proceeding, or governmental investigation relating to the Company’s properties or Business.

          (c) Right to Participate in TUPE Process with Company Employees . Before the Closing Date, the Sellers shall allow, permit, authorize and facilitate the Purchasers or their Affiliates to participate in the TUPE process with the Company Employees.

          (d) No Solicitation . The Sellers acknowledge that the Purchasers have incurred and will incur substantial third party fees and internal costs in performing their due diligence investigation and performing their other covenants and agreements hereunder. In consideration of the efforts the Purchasers have undertaken and propose to undertake, and in order to facilitate the Contemplated Transactions, the Sellers agree that prior to the termination pursuant to Section 2.7 of the obligations of the Parties hereunder, neither of the Sellers will authorize or permit any of their Affiliates or any officer, director, employee, investment banker, attorney or other adviser or representative of any of their Affiliates to, (i) solicit, initiate, or encourage the submission of, any Acquisition Proposal, (ii) enter into any agreement with respect to any Acquisition Proposal, or (iii) participate in any discussions or negotiations regarding, or furnish to any person any information for the purpose of facilitating the making of, or take any other action to facilitate any inquiries or the making of, any proposal that constitutes, or may reasonably be expected to lead to, any Acquisition Proposal. The Sellers promptly shall advise the Purchasers of any Acquisition Proposal and any inquiries with respect to any Acquisition Proposal made to the Sellers or any inquiries of which any officer of either of the Sellers becomes aware has been made to any of the Sellers’ Affiliates.

          (e) VAT Registration. By the Closing Date, the Purchasers will have applied for VAT registration in the United Kingdom for Entertainment Limited, with an effective date as of, or prior to, the Closing Date.

          (f) Satisfaction of Conditions Precedents. The Sellers and the Purchasers each shall use all commercially reasonable efforts to cause the conditions precedent set forth in Section 2.5 to be satisfied on or before the Closing Deadline Date. Without limiting the foregoing, the Sellers shall use all commercially reasonable efforts to cause the conditions precedent set forth in Sections 2.5(b)(iv) and 2.5(b)(ix) to be satisfied on or before the Closing Deadline Date. Notwithstanding anything to the contrary contained herein or in the respective documents hereinafter referenced in this sentence, all documents (including, but not limited to, the Related Agreements) received by each Party as required under Sections 2.5(b) and 2.5(c) shall become effective and enforceable only upon receipt by the Sellers of the Closing Payment via wire transfer pursuant to Section 2.9(b) .

     2.7 Termination . The Parties may terminate this Agreement prior to Closing, as follows:

          (a) Mutual Consent . By mutual written consent of the Purchasers and the Sellers.

          (b) Purchasers . The Purchasers may terminate if:

               (i) any representation or warranty of the Sellers set forth in this Agreement was inaccurate in a material respect when made or becomes inaccurate such that the condition set forth in Section 2.5(b)(i) could not be satisfied; or

               (ii) if either or both of the Sellers fail to perform or comply in a material respect with any of the respective obligations that each is required to perform or to comply with under this Agreement such that the conditions set forth in Section 2.5(b) could not be satisfied or otherwise if the conditions in Sections 2.5(b)(ii), (iii), (iv) and/or (v) are not satisfied; or

               (iii) if the Closing has not occurred on or before 5:00 p.m. (E.D.T) on the first business day following forty-five (45) days after the Execution Date (the “ Closing Deadline Date ”) solely due to either or both of the Sellers’ failure to perform or comply in a material respect with any of the respective obligations that each is required to perform or to comply with under this Agreement.

          (c) Sellers . The Sellers may terminate if:

               (i) any representation or warranty of the Purchasers set forth in this Agreement was inaccurate in a material respect when made or becomes inaccurate such that the condition set forth in Section 2.5(c)(i) could not be satisfied; or

               (ii) if either or both of the Purchasers fail to perform or comply in a material respect with any of the respective obligations that each is required to perform or to comply with under this Agreement such that the conditions set forth in Section 2.5(c) could not be satisfied or otherwise if the conditions in Sections 2.5(c)(ii), (iii) and/or (iv) are not satisfied; or

               (iii) if the Closing has not occurred on or before 5:00 p.m. (E.D.T) on the Closing Deadline Date, solely due to either or both of the Purchasers’ failure to perform or comply in a material respect with any of the respective obligations that each is required to perform or to comply with under this Agreement.

     2.8 Effect of Termination . In the event of termination of this Agreement as expressly permitted in Section 2.7 , this Agreement shall become void and neither the Sellers nor the Purchasers shall have any further rights or obligations under this Agreement. Termination of this

Agreement will not affect any rights that any of the Parties may have with respect to any breach of this Agreement made by the other Party prior to the date of termination. In the event of termination before the Closing, each Party shall return promptly to the other Parties all documents, work papers, and other materials of the other Party furnished or made available to such Party or its representatives or agents and all copies thereof, or provide the other Parties with a letter affirming the destruction thereof.

     2.9 Closing and Actions To Be Taken At Closing .

          (a) The Closing shall take place at such place as may be mutually agreed upon by the Parties, at 2:00 p.m., E.D.T., on the second Business Day following the satisfaction or written waiver of the conditions precedent to Closing described in Section 2.5 (other than those conditions precedent that are contemplated hereunder to be fulfilled at Closing), or such later date as the Parties may mutually agree in writing. (The date on which the Closing occurs is sometimes referred to herein as the “ Closing Date .”) At the Closing, the Parties shall deliver the following:

               (i) The Sellers and Purchasers shall execute and deliver a Bill of Sale in the form attached hereto as Exhibit A , for all of the Acquired Assets including the Games, Tangible Personal Property, Personal Property Leases, Acquired Contracts, Company Employees, other assets and Accounts Receivable (other than Retained Accounts Receivable); which Bill of Sale shall also contain Sellers’ assignment of the Acquired Contracts and Purchasers’ assumption of the Assumed Liabilities relating thereto.

               (ii) The Sellers and Holdings shall execute and deliver an Assignment of Trademarks and Service Marks, Assignment of Internet Domain Names, and Assignment of Copyrights, in the forms attached hereto as Exhibit B , for all of the Intellectual Property Rights in the Acquired Assets. The Sellers shall also execute and deliver to the Purchasers any and all further documents reasonably requested by Purchasers to evidence the full assignment to the Purchasers of all of the Sellers’ right, title and interest in and to the U.S. and foreign Trademarks and Copyrights that are defined herein as Intellectual Property Rights and listed in Section 2.1(a)(i) and Section 2.1(a)(ii) of the Disclosure Schedule.

               (iii) The Sellers and the Purchasers shall execute and deliver an Escrow Agreement in the form attached hereto as Exhibit C .

               (iv)  [Intentionally deleted] .

               (v) Each Party hereto shall deliver a duplicate of the Sublease Agreement signed by such Party.

               (vi) The Sellers shall deliver evidence that all Liens with respect to the Acquired Assets that exist at the date of this Agreement have been released and that the release

of those Liens has been evidenced by filings with the State of Delaware, the United States Patent and Trademark Office and anywhere else those Liens are recorded.

               (vii) The Sellers shall deliver to the Purchasers copies of resolutions of the boards of directors of (y) the Company, and (z) Atari, which resolutions shall be certified by such organizations’ respective secretaries or equivalent thereof, approving and authorizing the Sellers to execute and deliver this Agreement and all Related Agreements hereto, and approving and authorizing the Sellers’ performance of all obligations hereunder and thereunder.

               (viii) The Purchasers shall deliver to the Sellers copies of resolutions of the boards of directors of (y) Entertainment Limited, and (z) Holdings, which resolutions shall be certified by such organizations’ respective secretaries or equivalent thereof, approving and authorizing the Purchasers to execute and deliver this Agreement and all Related Agreements hereto, and approving and authorizing the Purchasers’ performance of all obligations hereunder and thereunder.

               (ix) In the event that the Sellers have not delivered evidence or copies of all needed signed Consents pursuant to Section 2.5(b)(ix) , the Sellers shall deliver all Consents that Sellers have obtained as of the Closing and pay to Purchasers the total amount of £168,000 via check for Acquired Contracts for which the Sellers have not obtained Consents (and which shall become Retained Contracts);

          (b) After the fulfillment of all executions and deliveries under Sections 2.9(a)(i) through 2.9(a)(ix) above, the Purchasers shall deliver to the Sellers evidence of payment of the Closing Payment to the Sellers by wire transfer of immediately available U.S. Dollars to such account as the Sellers may designate in advance and payment of the Holdback Funds to the Escrow Agent by wire transfer of immediately available U.S. Dollars to such account as the Escrow Agent may designate in advance. Notwithstanding anything to the contrary contained herein or in the respective documents hereinafter referenced in this sentence, all documents (including, but not limited to, the Related Agreements) received by each Party as required under Sections 2.5(b) and 2.5(c) shall become effective and enforceable only upon receipt by the Sellers of the Closing Payment via wire transfer pursuant to this Section 2.9(b) .

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLERS

     The Sellers, jointly and severally, represent and warrant to the Purchasers that the statements and information contained in this Article III and in the disclosure schedule delivered by the Sellers to the Purchasers simultaneously with the execution of this Agreement (the “ Disclosure Schedule ”) are true, correct and complete and will also be so as of Closing. Wherever the Sellers are not able to represent to the truthfulness and correctness of their representations, warranties and the statements and information contained in the Disclosure Schedule, it shall be noted herein and/or in the Disclosure Schedule.

     3.1 Organization and Qualification . The Sellers are duly organized, validly existing and in good standing under the laws of the jurisdictions of their respective organization, with the corporate or limited company power and authority, as the case may be, to own and operate their respective businesses as presently conducted, except for any failure to be in good standing or to have such power or authority that would not have a Material Adverse Effect. The Company is duly qualified as a foreign entity and in good standing in each jurisdiction where the character of the properties owned or held under lease by it or the nature of its activities makes such qualification necessary, except for such failures to be in good standing or so qualified as would not, individually or in the aggregate, have a Material Adverse Effect.

     3.2 Authorization; Validity and Effect of Agreement . The Sellers have the requisite corporate power and authority to execute, deliver and perform their obligations under this Agreement and to consummate the Contemplated Transactions. The Sellers represent and warrant specifically that they do not need any authorization or approval from their shareholders (including Infogrames) with respect to this transaction. The execution and delivery of this Agreement by the Sellers and the performance by the Sellers of their respective obligations hereunder and the consummation of the Contemplated Transactions have been duly authorized by the Board of Directors or other governing body of each Seller and all other necessary action on the part of each Seller and no other corporate or limited company proceedings on the part of either Seller are necessary to authorize this Agreement and the Contemplated Transactions. This Agreement has been duly and validly executed and delivered by each Seller and, assuming that it has been duly authorized, executed and delivered by the Purchasers, constitutes a legal, valid and binding obligation of each Seller, enforceable against it in accordance with its terms, subject to the effects of 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 by the Purchasers.

     3.3 No Conflict; Required Filings and Consents .

          (a) Neither the execution and delivery of this Agreement by either Seller, nor the performance by the Sellers of their obligations hereunder, nor the consummation of the Contemplated Transactions, will (i) conflict with either Seller’s certificate of incorporation or bylaws or other comparable charter or organizational documents; (ii) violate any statute, law, ordinance, rule or regulation, applicable to either Seller or any of the properties or assets of said Seller; or (iii) except as set forth in Section 3.3(a) of the Disclosure Schedule, violate, breach, be in conflict with or constitute a default (or an event which, with notice or lapse of time or both, would constitute a default) under, or permit the termination of any provision of, or result in the termination of, the acceleration of the maturity of, or the acceleration of the performance of any obligation of the Sellers, or result in the creation or imposition of any lien upon any properties, assets or business of the Sellers, any Acquired Contract or any order, judgment or decree to which the Sellers are a party or by which the Sellers or any of their respective assets or properties are bound or encumbered except, in the case of clauses (ii) and (iii), for such violations, breaches, conflicts, defaults or other occurrences which, individually or in the aggregate, would

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not have a Material Adverse Effect. Without limiting the generality of the foregoing, no direct or indirect subsidiary or Affiliate of either Seller has any enforceable right to distribute any product or product line included in the Acquired Assets that cannot be unilaterally terminated by the Sellers in connection with the consummation of the Contemplated Transactions, and any such distribution rights will be so terminated as of the Closing Date.

          (b) If all required Consents are obtained by the Sellers, then as a result of the acquisition of the Acquired Assets by the Purchasers:

               (i) no party will be relieved from its obligations under or entitled to terminate any agreement or arrangement with the Sellers;

               (ii) no supplier will have a right it does not otherwise have to cease or reduce its providing supplies to the Sellers; and

               (iii) no licence, consent or other permission or approval required for or in connection with the carrying on of the Company’s Business will terminate or be revoked or become capable of termination or revocation.

          (c) Except as set forth in Section 3.3(c) of the Disclosure Schedule, no consent, approval or authorization of, permit from, or declaration, filing or registration with, any Governmental Body or any other Person is required to be made or obtained by the Sellers in connection with the execution, delivery and performance of this Agreement and the consummation of the Contemplated Transactions, except where the failure to obtain such consent, approval, authorization, permit or declaration or to make such filing or registration would not, individually or in the aggregate, have a Material Adverse Effect.

     3.4 Compliance . Except as set forth in Section 3.4 of the Disclosure Schedule, each Seller is in compliance with all foreign, federal, state and local laws and regulations of a Governmental Body applicable to their respective operations, the Driver Games and Franchise, or with respect to which compliance is a condition of engaging in the business thereof, except to the extent that failure to comply would not, individually or in the aggregate, have a Material Adverse Effect. The Sellers have not received any notice asserting a failure, or possible failure, to comply with any such law or regulation, the subject of which notice has not been resolved as required thereby or otherwise to the satisfaction of the party sending the notice, except for any such failure as would not, individually or in the aggregate, have a Material Adverse Effect. Each Seller holds all permits, licenses and franchises from Governmental Bodies required to conduct its respective business as it is now being conducted, except for such failures to have such permits, licenses and franchises as would not, individually or in the aggregate, have a Material Adverse Effect.

     3.5 Title to Acquired Assets . Except as set forth on Section 3.5 of the Disclosure Schedule, as of the Closing Date, the Sellers do or will own all right, title and interest in all of the Acquired Assets free and clear of any and all Liens. The sale of the Acquired Assets by the Sellers to the Purchasers pursuant to this Agreement will effectively convey to the Purchasers all

of the Intellectual Property Rights, Software (including, without limitation, Source Code and Tools, Technology and Engines), Tangible Personal Property, Acquired Contracts and other assets (whether owned, leased or held under license by the Sellers, by any of the Sellers’ Affiliates or by others) in and to the Driver Games and Franchise, and the Company’s Business; provided, however, that any and all “off-the shelf” Software (e.g., Microsoft Word, Excel, Powerpoint, etc.) shall be expressly excluded from the Sellers’ representations and warranties under this Section 3.5.

     3.6 Contracts, Consents, Acquired Contracts and Assumed Liabilities . Section 3.6 of the Disclosure Schedule contains a true, correct, complete and accurate list of all of the Contracts relating to the Driver Games and Franchise and all of the Contracts relating to aspects of the Company’s Business other than the Driver Games and Franchise under which the Sellers expect the Purchasers to receive or be required to pay after the Closing more than $5,000 as to any single Contract. Section 2.1(a)(i) and Section 2.1(a)(ii) of the Disclosure Schedule contain true, correct, complete and accurate lists of all of the Contracts needed, used and made by the Sellers in conjunction with the Driver Games and Franchise and the Company’s Business, which are defined as the “ Acquired Contracts ” and all Consents needed thereto. True and accurate copies of the Contracts, including the Acquired Contracts, listed on Section 3.6 of the Disclosure Schedule, as in effect on the Execution Date hereof, have been delivered to the Purchasers as of the Closing. As of the Closing Date, (i) each of the Acquired Contracts is or will be valid and binding in accordance with its terms and will be in full force and effect; and (ii) there is or will have been no breach or violation of or default by either Seller under any Acquired Contract and no event has or will have occurred with respect to the Sellers which, with notice or lapse of time or