Quarterly Report — Form 10-Q
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-Q Quarterly Report HTML 448K
2: EX-10.1 Ex-10.1: First Amendment to Loan and Security 7 29K
Agreement
11: EX-10.10 Ex-10.10: 2005 Stock Incentive Plan 15 85K
3: EX-10.2 Ex-10.2: Agreement for Purchase and Sale of Assets 26 105K
4: EX-10.3 Ex-10.3: Stock Transfer Agreement 11 36K
5: EX-10.4 Ex-10.4: Liquidity Agreement 3 19K
6: EX-10.5 Ex-10.5: Distribution Agreement 6 32K
7: EX-10.6 EX-10.6 Amendment No. 1 Trademark License 2 13K
Agreement
8: EX-10.7 Ex-10.7: Agreement Regarding Issuance of Shares 4 22K
9: EX-10.8 Ex-10.8: Settlement of Indebtedness Agreement 4 19K
10: EX-10.9 Ex-10.9: Form of Securities Purchase Agreement 14 65K
12: EX-31.1 Ex-31.1: Certification HTML 13K
13: EX-31.2 Ex-31.2: Certification HTML 13K
14: EX-32.1 Ex-32.1: Certification HTML 10K
15: EX-32.2 Ex-32.2: Certification HTML 10K
16: EX-99.1 Ex-99.1: First Amendment to Confidential License 1 11K
Agreement
EX-10.9 — Ex-10.9: Form of Securities Purchase Agreement
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Exhibit 10.9
FORM OF SECURITIES PURCHASE AGREEMENT
This is an agreement (the "Agreement") dated September 15, 2005, among
Atari, Inc, (the "Company"), a Delaware corporation, and the investors listed on
Schedule A (the "Investors," and each of them an "Investor") regarding (a) the
sale by the Company to the Investors of the respective numbers of shares of
common stock, par value $.01 per share, of the Company ("Common Stock") listed
on Schedule A (together, the "Shares") in transactions that are exempt from the
registration requirements of the U.S. Securities Act of 1933, as amended (the
"Securities Act") because they do not involve a public offering, and (b) the
agreement of the Company to register resales of the Shares under the Securities
Act.
The Company and the Investors agree as follows:
ARTICLE I
PURCHASE AND SALE OF SHARES
Section 1.01. Purchase and Sale. At the Closing described in Section 1.02,
the Company will sell the Shares to the respective Investors, and the respective
Investors will purchase the Shares from the Company, for $1.30 per share.
Section 1.02. The Closing.
a. The closing of the sale of the Shares to the Investors will take
place at 10:00 a.m., New York City time, at the office of the Company , 417
Fifth Avenue, New York, New York, on September 15, 2005 (the "Closing Date").
b. At the Closing, the Company will deliver to each Investor
certificates representing the number of Shares the Investor is purchasing, as
shown on Schedule A. Each certificate will bear a legend stating that the shares
it represents were issued in a transaction that was not registered under the
Securities Act of 1933, as amended (the "Securities Act"), and those shares may
be sold or otherwise transferred only in a transaction that is registered under
that Act or is exempt from the registration requirements of that Act and any
applicable state securities laws.
c. At the Closing, each Investor will deliver to the Company evidence
of a wire transfer to an account in New York City specified by the Company of
immediately available United States dollars in an amount equal to the purchase
price of all the Shares the Investor is purchasing, as shown on Schedule A.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.01. Representations and Warranties of the Company. The Company
represents and warrants to each of the Investors as follows:
a. The Company is a corporation duly incorporated and in good standing
under the laws of the State of Delaware.
b. The Company has all corporate power that is necessary to enable it
to enter into this Agreement and to carry out the transactions contemplated by
it. All corporate actions that are necessary to authorize the Company to enter
into this Agreement and carry out the transactions
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contemplated by it have been taken. This Agreement has been duly executed by the
Company and is a valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms.
c. Neither the execution and delivery of this Agreement by the Company
nor completion of any of the transactions contemplated by it will violate,
result in a breach of, or constitute a default (or an event which, with notice
or lapse of time or both, would constitute a default) under, the Certificate of
Incorporation or by-laws of the Company, any agreement or instrument to which
the Company or any subsidiary of the Company is a party or by which any of them
is bound, any law, or any order, rule or regulation of any court or governmental
agency or other regulatory organization having jurisdiction over the Company or
any of its subsidiaries.
d. No governmental filings, authorizations, approvals or consents, or
other governmental actions, are required to permit the Company to fulfill all
its obligations under this Agreement.
e. The only authorized stock of the Company is 300,000,000 shares of
Common Stock and 5,000,000 shares of Preferred Stock. At the date of this
Agreement (without taking account of the issuance of the Shares), the only
outstanding stock of the Company is not more than 129,000,000 shares of Common
Stock. Except as reflected in the Company's report on Form 10-Q for the period
ended June 30, 2005, that the Company filed with the U.S. Securities and
Exchange Commission (the "SEC"), the Company has not issued any options,
warrants or convertible or exchangeable securities which are outstanding, and is
not a party to any other agreements, which require, or upon the passage of time,
the payment of money or the occurrence of any other event may require, the
Company to sell or issue any of its stock.
f. The Company has filed with the SEC all forms, statements, reports
and documents it has been required to file under the Securities Act, the
Securities Exchange Act of 1934, as amended (the "Exchange Act") or the rules
under either of them.
g. The Company's Annual Report on Form 10-K for the year ended March
31, 2005 (the "Company 10-K") and its Report on Form 10-Q for the period ended
June 30, 2005 (the "June 10-Q") which were filed with the SEC, including the
documents incorporated by reference in each of them, each contained all the
information required to be included in it and, when it was filed, did not
contain an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements made in it, in light of the
circumstances under which they were made, not misleading. Without limiting what
is said in the preceding sentence, the financial statements included in the
Company 10-K all were prepared, and the financial information included in the
June 10-Q was derived from financial statements which were prepared, in
accordance with United States generally accepted accounting principles ("GAAP")
applied on a consistent basis (except that financial information included in the
June 10-Q does not contain all the notes that are required by GAAP and is
subject to normal year end adjustments) and present fairly the consolidated
financial condition and the consolidated results of operations of the Company
and its subsidiaries at the dates, and for the periods, to which they relate.
h. The Offering Memorandum dated September 15, 2005 that was given to
each of the Investors (the "Offering Memorandum"), including the documents
incorporated by reference in it, does not contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements made in it, in light of the circumstances under which they were made,
not misleading.
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i. Except as reported in filings with the SEC, described in the
Offering Memorandum or described in press releases that were made generally
available to the investing public, since June 30, 2005, (i) the Company and its
subsidiaries have conducted their businesses in the ordinary course and in the
same manner in which they were conducted prior to June 30, 2005, and (ii) there
has not been a material adverse change in the financial condition, results of
operations, business or prospects of the Company and its subsidiaries taken as a
whole.
j. The assets of the Company and its subsidiaries are sufficient to
enable them to operate their businesses after the Closing substantially as they
are being operated on the date of this Agreement.
k. The Company and its subsidiaries have at all times complied, and
are currently complying, with all applicable Federal, state, local, and foreign
laws, except failures to comply which would not reasonably be expected, in the
aggregate, to have a material adverse effect on the Company.
l. Neither the Company nor any person acting on its behalf has engaged
in any form of general solicitation or general advertising (as those terms are
used in SEC Regulation D) in connection with the offer or sale of the Shares.
Neither the Company nor any person acting on its behalf has at any time within
the past six months, made any offer or sale of, or solicited an offer to buy,
any security of the Company under circumstances that would (i) eliminate the
availability of the exemption from the registration requirements of the
Securities Act contained in Section 4(2) of that Act or (ii) cause the Company's
offer or sale of the Shares to be integrated with prior offerings in a manner
that would cause the offer and sale of the Shares not to be eligible for the
exemption contained in Section 4(2) of the Securities Act.
m. The Company is eligible to register resales of the Shares on Form
S-3 promulgated under the Securities Act.
n. The Company has not granted any person a right to have securities
registered under the Securities Act that would interfere with the Company's
obligations under Article V or would require the Company to include securities
other than the Shares in the registration statement the Company files in
accordance with that Article.
o. None of the Company, any of its directors or officers, or to the
best of the Company's knowledge, any other person acting on the Company's
behalf, has provided any of the Investors, or any of their agents, advisors or
attorneys, any information that constitutes, or might reasonably be deemed to
constitute, material nonpublic information about the Company or its
subsidiaries, other than information about the proposed sale of the Shares and
information about a proposed issuance of shares to Infogrames Entertainment S.A.
that will be disclosed to the public not later than 9:00 a.m., New York City
time on the first Nasdaq trading day after the Closing Date. The Company is
aware that the Investors may rely on the representations in this paragraph in
effecting transactions in the Company's securities.
Section 2.02. Representations and Warranties of the Investors. Each
Investor represents and warrants to the Company, as to itself but not as to any
other Investor, as follows:
a. The Investor is an entity duly formed and validly existing in the
jurisdiction in which it was formed.
b. The Investor has all power that is necessary to enable the Investor
to enter into this Agreement and to carry out the transactions contemplated by
it. All actions that are necessary to
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authorize the Investor to enter into this Agreement and carry out the
transactions contemplated by it have been taken. This Agreement has been duly
executed by the Investor and is a valid and binding agreement of the Investor,
enforceable against the Investor in accordance with its terms.
c. Neither the execution and delivery of this Agreement by the
Investor nor completion of any of the transactions contemplated by it will
violate, result in a breach of, or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default) under, the organic
documents of the Investor, any agreement or instrument to which the Investor or
any subsidiary of the Investor is a party or by which any of them is bound, any
law, or any order, rule or regulation of any court or governmental agency or
other regulatory organization having jurisdiction over the Investor or any of
its subsidiaries.
d. No governmental filings, authorizations, approvals or consents, or
other governmental actions, are required to permit the Investor to fulfill all
the Investor's obligations under this Agreement.
e. The Investor will be acquiring the Shares at the Closing for the
Investor's own account and not with a view to the resale or distribution of the
Shares, other than in a transaction registered under the Securities Act or that
is exempt from the registration requirements of the Securities Act and any
applicable U.S, state securities laws, and the Investor does not have a current
arrangement to distribute the Shares it will be purchasing, provided that
nothing in this representation will require the Investor to hold any of the
Shares for a minimum period of time or will prevent the Investor from disposing
of any Shares at any time in a transaction that is registered under the
Securities Act or is exempt from the registration requirements of the Securities
Act and complies with all applicable state securities laws.
f. When the Investor was offered the Shares it will be purchasing, and
at the date of this Agreement, the Investor was and is an accredited investor,
as that term is defined in Rule 501(a) under the Securities Act.
g. The Investor, either alone or together with its representatives,
has sufficient knowledge, sophistication and experience in business and
financial matters to be capable of evaluating the merits and risks of its
prospective investment in Shares, and the Investor has made such an evaluation
of the merits and risks of that investment. The Investor is able to bear the
economic risk of the proposed investment in Shares and, at the present time, is
able to afford a complete loss of that investment.
h. The Investor acknowledges that it has reviewed the Offering
Memorandum and the materials incorporated into it and has been afforded (i) the
opportunity to ask such questions as it has deemed necessary of, and to receive
answers from, representatives of the Company concerning the terms and conditions
of the offering of the Shares and the merits and risks of investing in the
Shares; (ii) access to information (other than material non-public information)
about the Company and its subsidiaries and their financial condition, results of
operations, business, properties, management and prospects sufficient to enable
it to evaluate its proposed investment; and (iii) the opportunity to obtain any
additional information that the Company possesses or can acquire without
unreasonable effort or expense that the Investor believes is necessary to enable
the Investor to make an informed investment decision with respect to its
proposed investment. Neither any inquiries made by or on behalf of the Investor
nor any other investigation conducted by or on behalf of the Investor or its
representatives or counsel will affect the Investor's right to rely on the
truth, accuracy and completeness of the Offering Memorandum and the materials
incorporated by reference into it or the Company's representations and
warranties in this Agreement.
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i. The Investor understands that no United States federal or state
agency or any other government or governmental agency has passed on or made any
recommendation or endorsement of the Shares or the fairness or suitability of an
investment in the Shares and that no such authorities have passed upon or
endorsed the merits of the offering of the Shares.
j. The Investor is aware that the Offering Memorandum states under the
caption "Notice to Investors; Transfer Restrictions" that each purchaser of
Shares will be deemed to have made certain representations and agreements, and
the Investor confirms that by purchasing Shares the Investor will be making
those representations and agreements.
k. Since the Investor was first contacted regarding a purchase of
Shares, the Investor has not directly or indirectly engaged in any transactions
in securities of the Company (including any short sales, as defined in Rule 200
of SEC Regulation SHO under the Exchange Act), and the Investor has no intention
of engaging in any transactions in securities of the Company until the
transactions that are the subject of this Agreement are publicly disclosed.
l. The Investor is aware that nothing in this Agreement or in the
Offering Memorandum or any other materials given to the Investor by or on behalf
of the Company in connection with the sale of the Shares constitutes legal, tax
or investment advice, and the investor has obtained any legal, tax or investment
advice that the Investor has deemed necessary from the Investor's own advisors.
ARTICLE III
OTHER AGREEMENT5
Section 3.01. Transfer Restrictions. Each Investor agrees that it will not
dispose of any Shares, other than in a transaction that is registered under the
Securities Act or is exempt from the registration requirements of the Securities
Act and complies with all applicable U.S. state securities laws.
Section 3.02. Removal of Legends. The Company agrees that at any time when
(i) a registration statement under the Securities Act relating to the resale of
the Shares is effective, (ii) the Investor has sold Shares in a transaction that
complies with SEC Rule 144, (iii) the Shares held by the Investors are eligible
for sale under SEC Rule 144(k), or (iv) for any other reason, the Shares held by
Investors are freely salable, under the Securities Act without limitation upon
the number of Shares that may be sold or the manner in which they may be sold,
the Company will, at the request of any Investor, issue to that Investor (or to
the purchaser in a sale by any Investor that complies with SEC Rule 144(a)), in
exchange for certificates representing Shares that bear the legend described in
Section 1.02(b), certificates representing the same numbers of shares of Common
Stock that do not bear that legend.
Section 3.03. Public Announcement and SEC Filing. Not later than 9:00 a.m.,
New York City time, on the first Nasdaq trading day after the date of this
Agreement, the Company will disclose to the public the material terms of the
transactions that are the subject of this Agreement (whether in a press release
or a filing with the SEC). Not later than four business days after the Closing
Date, the Company will file with the SEC a Report on Form 8-K containing the
required information regarding those transactions.
Section 3.04. Ongoing Filings with the SEC. Until the earlier of two years
after the Closing Date or such time as no Investor any longer holds any Shares,
the Company will file on a timely basis (taking account of available extensions)
all reports the Company is required to file with the SEC under the Exchange Act.
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ARTICLE IV
CONDITIONS TO THE PARTIES' OBLIGATIONS
Section 4.01. Conditions Precedent to the Investors' Obligations. The
obligation of each Investor to purchase Shares at the Closing is subject to the
following conditions (which may be waived by each Investor as to itself, but not
as to any other Investor):
a. The representations and warranties of the Company contained in this
Agreement will be true and correct in all material respects at the Closing Date
with the same effect as though they had been made on that date (except to the
extent particular representations and warranties state that they relate to
specified dates). b. The Company and each of the other Investors will have
fulfilled in all material respects all the obligations that the Company or the
other Investor is required by this Agreement to fulfill at or before the
Closing.
Section 4.02. Conditions Precedent to the Company's Obligations. The
obligation of the Company to sell Shares at the Closing is subject to the
following conditions (which may be waived by the Company):
a. The representations and warranties of each of the Investors
contained in this Agreement will be true and correct in all material respects at
the Closing Date with the same effect as though they had been made on that date
(except to the extent particular representations and warranties state that they
relate to specified dates).
b. Each of the Investors will have fulfilled in all material respects
all the obligations that Investor is required by this Agreement to fulfill at or
before the Closing.
ARTICLE V
REGISTRATION OF SHARES
Section 5.01. Obligation to Register Shares.
a. As promptly as practicable after the Closing Date, the Company will
prepare and file with the SEC a "shelf" registration statement on Form S-3 (the
"Registration Statement") registering resales of Shares on a continuous basis
pursuant to Rule 415 under the Securities Act in transactions on any securities
exchanges or securities quotation systems on which the Common Stock may be
eligible for trading, in negotiated transactions, in transactions involving
principals or brokers, in a combination of those methods of sale or by any other
lawful means.
b. The Company will use its reasonable best efforts to cause the
Registration Statement to be declared effective by the SEC as promptly as
possible, and in any event not later than the 90th day after the Closing Date
(the "Required Effectiveness Date"), and will use its reasonable best efforts to
keep the Registration Statement continuously effective under the Securities Act
until the earlier of the date that all the Shares have been sold and may be
resold to the public without registration under the Securities Act or the date
that all the Shares can be sold to the public under Rule 144(k) (the
"Effectiveness Period").
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Section 5.02. Payment if Specified Events Occur.
a. If any of the Events listed below occurs, until the Event is cured,
on each monthly anniversary of the day on which the Event occurs, the Company
will pay each Investor, in cash, as liquidated damages, the sum equal to 1% of
(i) the number of Shares the Investor holds, times (ii) the purchase price the
Investor paid for the Shares ($1.30 per share). If an Event is cured during a
month, the payment with regard to that month will be pro-rated based on the
number of days in the month before and after the Event is cured.
b. Each of the following will constitute an Event:
(i) The Registration Statement is not declared effective on or
before the Registration Effectiveness Date.
(ii) The Common Stock is not eligible for trading on the Nasdaq
National Market System or on the New York or the American Stock Exchange.
(iii) The effectiveness of the Registration Statement is
suspended.
(iv) A suspension under Section 5.02(c) becomes an Event.
c. After the Registration Statement has been continuously effective
for at least 60 trading days, the Company may, by a written notice to the
Investors, suspend sales under the Registration Statement if the Company is
engaged in a material merger, acquisition or sale and the Company's Board of
Directors determines in good faith that, because of a need to amend or
supplement the Company's registration statements or for any other reason, it
would be materially detrimental to the Company (other than with regard solely to
the price of the Common Stock) for shares of its Common Stock to be available
for sale to the general public pursuant to a registration statement at that
time. Upon receipt of such a notice, each Investor will immediately discontinue
any sales of Shares pursuant to the Registration Statement until the Investor
has received copies of a supplemented or amended prospectus or until the
Investor is advised in writing by the Company that the then current prospectus
may be used or that, for any other reason, the suspension has been terminated.
In no event, however, may the Company suspend sales beyond the period during
which (in the good faith determination of the Company's Board of Directors) the
failure to require the suspension would be materially detrimental to the
Company, any suspension last for more than 20 days or the Company suspend sales
under this Section more than three times in any twelve month period. Any
suspension that lasts for more than 20 days will become an Event at the end of
the 20 days.
Section 5.03. Registration Procedures.
a. The Company will provide to the Investors copies of the proposed
Registration Statement and of any proposed amendment or supplement to the
Registration Statement at least three Nasdaq trading days before it is filed
with the SEC and the Company will reflect in the Registration Statement or the
amendment or supplement any reasonable and prompt comments that any Investors
may make.
b. The Company will file any amendments or post-effective amendments
to the Registration Statement that are necessary to keep the Registration
Statement continuously effective and
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available for use throughout the Effective Period, except during a period of
suspension permitted by Section 5.02(c).
c. The Company will promptly notify each of the Investors in writing
(i) if the SEC notifies the Company that the Registration Statement will be
reviewed, (ii) if the Company receives written comments regarding the
Registration Statement from the SEC staff (in which case the Company will
provide each of the Investors with a copy of the comment letter), (iii) when the
Registration Statement or any post-effective amendment to it becomes effective,
(iv) if the SEC initiates a proceeding for the purpose of issuing a stop order
suspending effectiveness of the Registration Statement or such a stop order is
issued, or (v) if the financial statements included in the Registration
Statement cease to meet applicable SEC requirements for inclusion in a
registration statement of the Company under the Securities Act.
d. The Company will use its reasonable best efforts to avoid the
issuance of any order suspending effectiveness of the Registration Statement or
of the qualification (or exemption from qualification) of the Shares in any
jurisdiction, and if such an order is issued, the Company will use its
reasonable best efforts to cause it to be withdrawn as promptly as practicable.
e. The Company will provide each Investor, without charge, with one
copy of the Registration Statement and each amendment to it, and with as many
copies of the prospectus included in the Registration Statement as the Investor
reasonably requests.
f. The Company will use its reasonable best efforts to cause Shares to
be registered or qualified under (or qualified for an exemption from) the
securities or Blue Sky laws of such jurisdictions in the United States as any
Investor may reasonably request and to keep that registration or qualification
in effect for such period as it is required, but not beyond the end of the
Effectiveness Period.
g. The Company will cooperate with any reasonable due diligence
investigation any Investor wants to undertake in connection with the resale of
the Investor's Shares, but the Company will not be required to make available to
any Investor any material nonpublic information about the Company or its
subsidiaries.
Section 5.04. Indemnification.
a. The Company will indemnify and hold harmless each Investor, each
officer, director, partner, employee, legal counsel and agent of each Investor,
and each underwriter, if any, and each person, if any, who controls any Investor
or underwriter within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act against any losses, liabilities, claims, damages or
expenses (including, but not limited to, attorneys' fees and expenses and costs
of investigation), including any payments in settlement of litigation, arising
out of, or based upon, any actual or alleged untrue statements, or omissions of
statements necessary in order to make statements that are made not misleading,
in the Registration Statement, in any prospectus included in the Registration
Statement, in any amendment or supplement to the Registration Statement or any
prospectus included in it, or in any application or related document filed in
any jurisdiction in order to qualify Shares under the securities laws of that
jurisdiction which was executed by the Company or based upon written information
furnished by the Company, or any violation by the Company of the Securities Act
or any rule or regulation under it applicable to the Company and relating to
action or inaction by the Company in connection with the registration or
qualification of the Shares, and the Company will reimburse each Investor, each
of its officers, directors, members, stockholders and partners, each such
underwriter and each person who controls the Investor or any such underwriter,
for any legal or other expenses reasonably incurred in connection with
investigating, preparing to defend or defending any such claim, loss, damage,
8
liability or action, provided, that the Company will not be liable under this
Section with regard to any claim relating to a statement or omission with
respect to an Investor or underwriter that was made in reliance upon and in
conformity with written information furnished to the Company by that Investor or
underwriter for inclusion in the Registration Statement or other document.
b. Each Investor will indemnify and hold harmless the Company, each
director, officer, employee, legal counsel and agent of the Company, each
underwriter, if any, and each other person, if any, who controls the Company or
any underwriter within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent the Company agrees in Section
5.04(a) to indemnify and hold harmless each Investor, but only with respect to
statements or omissions with respect to that Investor that were made in reliance
upon and in conformity with written information furnished to the Company by that
Investor for inclusion in the Registration Statement or the prospectus included
in it, in an amendment or supplement to the Registration Statement or that
prospectus, or in an application relating to the sale of the Shares.
c. If an action is brought against a person entitled to
indemnification under Section 5.04(a) or (b) (an "Indemnified Person") in
respect of which that person may seek indemnity, the Indemnified Person will
promptly notify all the persons (the "Indemnifying Persons") against whom
indemnification may be sought in writing of the commencement of the action (but
failure to give the notice will not relieve the Indemnifying Persons from any
liability they may have other than under this Section 5.04), and the
Indemnifying Persons will be entitled to assume the defense of the action on
behalf of the Indemnified Persons with counsel selected by the Indemnifying
Persons who are reasonably satisfactory to the Indemnified Persons. Any
Indemnified Person may employ its own additional counsel with regard to an
action, but if one or more Indemnifying Persons assumes the defense of the
action, the Indemnifying Persons will not be responsible for the fees and
expenses of additional counsel employed by an Indemnified Person. An
Indemnifying Person will not be liable for any settlement of a claim or action
effected without its written consent, which consent will not be unreasonably
withheld or delayed. An Indemnifying Person will not, without the prior written
consent of each Indemnified Person that is not released as described in this
sentence, settle or compromise any action, or permit a default or consent to the
entry of judgment in any action, in respect of which indemnity may be sought
under this Section (whether or not any Indemnified Person is a party to the
action), unless the settlement, compromise or judgment includes an unconditional
release of each Indemnified Person from all liability in respect of the action.
Section 5.05. Rights of Transferees. If any Investor transfers Shares in a
transaction that does not permit the person to whom the Shares are transferred
to sell them to the public without registration under the Securities Act, the
person to whom the Shares are transferred will be entitled to the benefits of
this Agreement, including Article V, if (i) the Company is notified about the
transfer and provided with the name, address and social security or employer
identification number of the person to whom the Shares are transferred and (ii)
the person to whom the Shares are transferred agrees to be bound by this
Agreement (including Sections 5.04(b) and (c)) to the same extent as an Investor
who executed this Agreement. If an Investor transfers Shares to a person who
does not become entitled to the benefits of this Article V as provided in the
preceding sentence, the Shares which are transferred to that person will cease
being entitled to the benefits of this Article V (including Section 5.04(a))
until such, if any, time as the person to whom the Shares are transferred
becomes entitled to the benefits of this Article V.
9
ARTICLE VI
MISCELLANEOUS
Section 6.01. Termination. This Agreement may be terminated by the Company
or any Investor, by written notice to the other parties, if the Closing has not
been consummated by the tenth Nasdaq trading day following the date of this
Agreement; provided that no such termination will affect the right of any party
to recover damages for any breach by any other party (or parties).
Section 6.02. Entire Agreement. This Agreement and the documents to be
delivered in accordance with this Agreement contain the entire agreement among
the Company and the Investors relating to the transactions that are the subject
of this Agreement and those other documents, all prior negotiations,
understandings and agreements between the Company and any of the Investors are
superseded by this Agreement and those other documents, and there are no
representations, warranties, understandings or agreements concerning the
transactions that are the subject of this Agreement or those other documents
other than those expressly set forth in this Agreement or those other documents.
Section 6.03. Notices. Any notices or other communications under this
Agreement must be in writing and will be deemed given on the earliest of (a) the
date of transmission, if the notice or other communication is delivered by email
or facsimile prior to 6:30 p.m., New York City time, on a Nasdaq trading day,
(b) the next Nasdaq trading day after the date of transmission, if the notice or
other communication is delivered by email or facsimile on a day that is not a
Nasdaq trading day or later than 6:30 p.m., New York City time, on a Nasdaq
trading day, (c) the next Nasdaq trading day after the date of delivery to a
nationally recognized overnight courier service designated for next business day
delivery, or (d) upon actual receipt by the party to whom it is addressed if
given in any other manner (including by mail).. The addresses, email addresses
and facsimile numbers for notices and other communications are those set forth
on the signature pages of this Agreement, or such other address, email address
or facsimile number as the person to whom a notice or other communication is
sent may designate in the manner provided in this Section after the date of this
Agreement.
Section 6.04. Amendments; Waivers. No provision of this Agreement may be
waived or amended except in a written instrument signed, in the case of an
amendment, by the Company and each of the Investors or, in the case of a waiver,
by the party against whom the waiver is being enforced. No waiver of a default
with respect to any provision of this Agreement will constitute a waiver of a
subsequent default with respect to that provision or a default with respect to
any other provision.
Section 6.05. Captions. The captions of the Articles and Sections of this
Agreement are for convenience only, and are not intended to affect the meaning
or the interpretation of this Agreement.
Section 6.06. Binding Effect. This Agreement will be binding upon and inure
to the benefit of the parties to it and their successors and permitted assigns.
This Agreement is not intended to be for the benefit of any other person, except
that each Indemnified Person is an intended beneficiary of Section 5.04.
Section 6.07. Assignment. The Company may not assign its rights or
obligations under this Agreement without the prior written consent of Investors
who hold a majority of the Shares that are still held by Investors.. Any
Investor may assign its rights under this Agreement to the extent provided in
Section 5.05 to a person to whom that Investor transfers Shares. Notwithstanding
anything to
10
the contrary in this Agreement, Shares may be assigned to any person in
connection with a bona fide margin account or other loan or financing
arrangement secured by those Shares.
Section 6.08. Governing Law; Consent to Jurisdiction. This Agreement will
be governed by the laws of the State of New York in the United States of
America, without regard to principles of conflicts of laws that would apply the
law of any other jurisdiction. Each of the parties (i) agrees that any action or
proceeding relating to this Agreement may be brought in, but only in, a state or
Federal court sitting in the Borough of Manhattan in the State of New York, (ii)
consents to the personal jurisdiction of any such court in any such action or
proceeding, (iii) agrees not to seek to change the venue of any such action or
proceeding that is brought in any such court, whether on the basis of
inconvenience of the forum or for any other reason, and (iv) agrees that process
in any such action or proceeding may be served by registered mail or in any
other manner permitted by the rules of the court in which the action or
proceeding is brought.
Section 6.09. Counterparts. This Agreement may be executed in two or more
counterparts, some of which may contain the signatures of fewer than all the
parties or may contain facsimile copies of pages signed by some of the parties.
Each of those counterparts will be deemed to be an original copy of this
Agreement, but all of them together will constitute one and the same agreement.
[SIGNATURE PAGES TO FOLLOW]
11
IN WITNESS WHEREOF, the parties have executed this Agreement, intending to
be legally bound by it, as of the day shown on the first page.
ATARI, INC.
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Address for Notices: 417 Fifth Avenue
New York, NY 10016
United States of America
Attention: Chief Financial Officer
Email Address:
----------------------
Facsimile No.:
----------------------
12
INVESTOR SIGNATURE PAGE
IN WITNESS WHEREOF, the parties have executed this Agreement, intending to
be legally bound by it, as of the day shown on the first page.
Name of Investor:
--------------------------------------------------------------
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
Address for Notices:
-----------------------------------------------------------
-----------------------------------------------------------
-----------------------------------------------------------
Taxpayer Identification Number
-------------------------------------------------
Email Address:
-----------------------------------------------------------------
Facsimile No.:
-----------------------------------------------------------------
Number of Shares Being Purchased:
----------------------------------------------
Aggregate Purchase Price: $______________________
Agreed to and accepted on September ______, 2005
13
SCHEDULE A
[Download Table]
NAME OF INVESTOR NUMBER OF SHARES BEING PURCHASED
---------------- --------------------------------
CCM Master Qualified Fund, LTD. 3,800,000
Sark Master Fund Ltd. 1,902,590
14
Dates Referenced Herein and Documents Incorporated by Reference
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