WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT

EXECUTION VERSION

Exhibit 10.1

WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT

          WAIVER AND SECOND AMENDMENT TO CREDIT AGREEMENT, dated as of November 6, 2007 (this “ Amendment ”), among ATARI, INC., a Delaware corporation, as borrower (the “ Borrower ”), the lenders party to the Credit Agreement referred to below (the “ Lenders ”), and BLUEBAY HIGH YIELD INVESTMENTS (LUXEMBOURG) S.A.R.L., as successor administrative agent (in such capacity, the “ Administrative Agent ”). Capitalized terms used and not otherwise defined herein shall have the meanings given them in the Credit Agreement referred to below.

W I T N E S S E T H:

          WHEREAS, the parties hereto are parties to that certain Credit Agreement, dated as of November 3, 2006 (as amended, supplemented or otherwise modified to, but not including, the date hereof, the “ Credit Agreement ”);

          WHEREAS, the Defaults and Events of Default specified on Schedule 1 hereto have occurred prior to and are continuing as of the date hereof (collectively, the “ Existing Defaults ”); and

          WHEREAS, the Borrower has requested that the Lenders waive the Existing Defaults and amend the Credit Agreement, and the Lenders have agreed to such waiver and amendments on the terms and conditions set forth herein.

          NOW, THEREFORE, it is agreed:

I. Waiver . Subject to the terms and conditions of this Amendment, and in reliance on the representations, warranties and covenants of the Borrower contained herein, from and after the Second Amendment Effective Date (as defined below), the Lenders waive all Existing Defaults. Nothing herein shall be deemed to constitute a waiver of compliance by the Borrower with its representations, warranties, covenants or obligations under, or compliance with any other term, provision or condition of, the Credit Agreement (as amended hereby) or any other Loan Document from and after the Second Amendment Effective Date.

II. Amendments to the Credit Agreement . Subject to the terms and conditions of this Amendment, and in reliance on the representations, warranties and covenants of the Borrower contained herein, from and after the Second Amendment Effective Date, the Credit Agreement is amended as follows:

          1. Section 1.01 is amended as follows:

          (a) The definition of “Loan Documents” is amended by amending and restating it as follows:

     “‘ Loan Documents’ means this Agreement, any promissory notes executed and delivered pursuant to Section 2.09(e), the Collateral Documents, the Credit Parties Guaranty, the Intercreditor Agreement and any and all other

instruments and documents executed and delivered in connection with any of the foregoing.”; and

          (b) the following new defined terms are inserted in the appropriate alphabetical order:

     “‘ IESA’ shall mean Infogrames Entertainment, S.A., a French corporation.

     ‘ Intercreditor Agreement ’ shall mean, from and after the execution and delivery thereof, an intercreditor agreement (if any) among the Administrative Agent, IESA and the Borrower.

     ‘ Second Amendment Effective Date ’ means the date the conditions set forth in Part V of the Waiver and Second Amendment to Credit Agreement are satisfied or waived by the Lenders.

      ‘TDU License Agreements’ shall mean the TDU Trademark License Agreement and the TDU Other IP License Agreement, collectively.

      ‘TDU Other IP License Agreement’ shall mean that certain General Intellectual Property and Proprietary Rights (Other Than Trademark Rights) License of the Test Drive Franchise, dated as of November 8, 2007 between the Borrower, as licensor, and IESA, as licensee, in respect of the video game called “Test Drive Unlimited” and the intellectual property and proprietary rights associated therewith, as amended, amended and restated, supplemented or otherwise modified from time to time with the prior consent of the Administrative Agent.

      ‘TDU Trademark License Agreement’ means that certain Trademark License of the Test Drive Franchise, dated as of November 8, 2007 between the Borrower, as licensor, and IESA, as licensee, in respect of the video game called “Test Drive Unlimited” and the trademarks associated therewith, as amended, amended and restated, supplemented or otherwise modified from time to time with the prior consent of the Administrative Agent.

     ‘ Waiver and Second Amendment to Credit Agreement ’ means the Waiver and Second Amendment to Credit Agreement, dated as of November 6, 2007, among the Borrower, the Administrative Agent and the Lenders party thereto.”.

          2. Section 6.01 is amended by amending and restating paragraph (e) as follows:

     “(e) Indebtedness of the Borrower arising under TDU License Agreements;”.

          3. Section 6.02 is amended by amending and restating paragraph (c) as follows:

     “(c) Liens created to secure obligations arising under the TDU License Agreements; provided that such Liens shall at all times be junior in priority and right to the Liens under the Collateral Documents and shall be subject to the terms of the Intercreditor Agreement; and”

          4. Section 6.07 is amended by amending and restating paragraph (e) as follows:

     “(e) transactions pursuant to the TDU License Agreements.”.

          5. Section 6.08(b)(iv) is amended by amending and restating it as follows:

     “(iv) clause (a) of the foregoing shall not apply to restrictions or conditions imposed under the TDU License Agreements or by any other agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness, and”

          6. Article VII is amended by (i) deleting from paragraph (m) “November 5, 2007” and substituting therefor “November 12, 2007”; and (ii) inserting in paragraph (n) immediately before the semicolon at the end thereof the following:

     “, or the Intercreditor Agreement or any provision thereof shall cease to be in full force or effect (except in accordance with its terms), any of the parties thereto (other than the Administrative Agent) shall deny or disaffirm their respective obligations thereunder or any of the parties thereto (other than the Administrative Agent) shall default in the due performance or observance of any term, covenant or agreement on their part to be performed or observed pursuant to the terms thereof”.

III. Acknowledgments and Agreements .

          1. The Borrower acknowledges and agrees that each of the Loan Documents to which it is a party (i) constitutes its legal, valid and binding obligation, and is enforceable against it in accordance with its terms, except to the extent that such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws generally affecting creditors’ rights and by equitable principals (regardless of whether enforcement is sought in equity or at law), and (ii) is hereby reaffirmed and ratified, including without limitation, each of the waiver of claims and defenses granted by the Borrower under the Loan Documents. Without limiting the generality of the foregoing, the Borrower unconditionally and irrevocably waives any claim or defense in respect of the Obligations, including, without limitation, any claim or defense based on any right of setoff or counterclaim.

          2. As of November 6, 2007, the Borrower acknowledges and agrees that it is indebted to the Lenders in the aggregate principal amount of $10,343,439.95, which is the outstanding principal amount of the Revolving Loans plus accrued and unpaid and accruing interest and fees. Nothing contained herein shall alter, amend, modify or extinguish the obligation of the Borrower to repay the Obligations, and neither this Amendment nor any of the other documents, agreements or instruments executed or delivered in connection herewith or related hereto constitutes a novation or, except as expressly provided herein, modification of any of the Loan Documents.

          3. The Borrower acknowledges and agrees that all of its assets pledged, assigned, conveyed, mortgaged, hypothecated