EXHIBIT 99.4
0000 XXXXXXXX XXXXXXXXX, XXX XXXXXXX, XXXXXXXXXX 00000-0000
MAILING ADDRESS: P.O. BOX 30014, LOS ANGELES, CALIFORNIA 90030-0014
[Graphic omitted] WEDBUSH XXXXXX (000) 000 0000
SECURITIES FAX (000) 000 0000
Investment Bankers Since 1925
January 7, 2004
CONFIDENTIAL
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Xx. Xxxxx Xxxxxxx
Chairman and CEO
California U.S. Holdings, Inc.
000 0xx Xxxxxx
Xxx Xxxx XX 00000
Dear Xx. Xxxxxxx:
This letter agreement (this "Agreement") confirms our understanding with respect
to the engagement by California U.S. Holdings, Inc. (the "Company") of Wedbush
Xxxxxx Securities, Inc. ("Wedbush Xxxxxx") in connection with the sale of
approximately 10 million shares of Atari, Inc. common stock (the "Securities")
on a best efforts basis through a registered direct offering or private
placement to "accredited" investors (the "Transaction"). The term of the
engagement shall be for a period of 12 months or until terminated by either
party as provided below (see Termination).
1. Scope of Engagement. The Company hereby engages Wedbush Xxxxxx to act as
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its placement agent ("Placement Agent") in connection with the Transaction.
Wedbush Xxxxxx shall assist the Company in preparing documents and in
identifying potential investors and shall, on behalf of the Company,
contact such potential investors as Wedbush Xxxxxx xxxxx appropriate.
Wedbush Xxxxxx shall assist the Company in analyzing, structuring,
negotiating and effecting the Transaction. The Company shall cooperate with
Wedbush Xxxxxx in connection with the identification of potential investors
and shall report and refer all contacts and inquiries received by the
Company regarding the engagement to Wedbush Xxxxxx. It is anticipated that
the Company shall also engage its own legal counsel and may require the
services of an accounting firm.
2. Company Information. The Company shall cooperate with Wedbush Xxxxxx in
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connection with its financial review and analysis of the Company and Atari,
Inc. and shall provide Wedbush Xxxxxx with such information concerning the
Company and Atari, Inc. as Wedbush Xxxxxx xxxxx reasonably necessary or
appropriate for such review and analysis (collectively, the "Information").
Wedbush Xxxxxx shall keep in confidence and shall not, without the
Company's prior consent, disclose to any person except on a need to know
basis internally (except its own counsel or as such counsel has reasonably
advised is required by applicable law and then only to the extent
necessary) any non-public Information furnished by or derived from any
Information furnished by the Company to Wedbush Xxxxxx.
MEMBER NEW YORK STOCK EXCHANGE
0000 XXXXXXXX XXXXXXXXX, XXX XXXXXXX, XXXXXXXXXX 00000-0000
MAILING ADDRESS: P.O. BOX 30014, LOS ANGELES, CALIFORNIA 90030-0014
[Graphic omitted] WEDBUSH XXXXXX (000) 000 0000
SECURITIES FAX (000) 000 0000
Investment Bankers Since 1925
All Information provided by the Company shall be accurate and complete in
all material respects and shall not contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein in light of the circumstances under which they were
made, not false or misleading. Wedbush Xxxxxx does not assume
responsibility for the accuracy or completeness of the Information,
including but not limited to any disclosure materials related to the
Transaction. The Company acknowledges and agrees that Wedbush Xxxxxx will
rely primarily on the Information and on information available from
generally recognized public sources in performing its services hereunder,
without having independently verified the same.
3. The Company shall pay Wedbush Xxxxxx the following amounts:
a. Minimum Fee. Upon the earliest of (i) closing of the Transaction, or (ii)
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termination of this Agreement, the Company shall pay Wedbush Xxxxxx a
minimum fee of $50,000, which shall be credited against any success fees
outlined below.
b. Fees for the Securities. Wedbush Xxxxxx shall be paid upon consummation of
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the Transaction a transaction fee, payable in cash, of 4.0% of the Gross
Proceeds (as defined below) from the sale of the Securities in connection
with the Transaction (the "Transaction Fee") and excludes expenses. For
purposes hereof, "Gross proceeds" shall mean the fair market value of all
of the consideration (including, without limitation, cash, securities,
other assets, and contingent payments such as earn-outs, only as and if the
money is actually received by the Company) paid by investors for the
Company's Securities issued in connection with the Transaction, as part of
such Transaction before the deduction of expenses related to the
Transaction, including the fee payable to Wedbush Xxxxxx.
c. Expenses. Wedbush Xxxxxx shall promptly be reimbursed for all of its
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reasonable out-of-pocket expenses incurred in connection with its
engagement hereunder, including fees and expenses of travel, legal
counsel, background checks, printing, shipping, delivery, and other third
party services, provided aggregate expenses shall not exceed $50,000 unless
approved in writing by the Company. Invoice(s) will be submitted to the
Company as expenses are incurred and shall be paid in 30 days or less. It
is anticipated that the Company will engage legal counsel, accountants, and
other professionals as reasonably required.
4. Indemnification. The Company shall indemnify Wedbush Xxxxxx and its
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affiliates and their respective directors, offices, employees, agents and
controlling persons (Wedbush Xxxxxx and each such person being an
"Indemnified Party") from and against any and all losses, claims, damages,
and liabilities, joint or several, to which such Indemnified Party may
become subject
MEMBER NEW YORK STOCK EXCHANGE
0000 XXXXXXXX XXXXXXXXX, XXX XXXXXXX, XXXXXXXXXX 00000-0000
MAILING ADDRESS: P.O. BOX 30014, LOS ANGELES, CALIFORNIA 90030-0014
[Graphic omitted] WEDBUSH XXXXXX (000) 000 0000
SECURITIES FAX (000) 000 0000
Investment Bankers Since 1925
under any applicable federal or state law, or otherwise related to or
arising out of any Transaction contemplated by this Agreement or the
engagement of Wedbush Xxxxxx pursuant to, or the performance by Wedbush
Xxxxxx of the services contemplated by this Agreement and shall reimburse
each Indemnified Party for all expenses (including reasonable legal fees
and expenses) as they are incurred in connection with the investigation of,
preparation for, or defense of any pending or threatened claim or any
action or proceeding arising there from, whether or not such Indemnified
Party is a party to such action or proceeding. Notwithstanding the
foregoing, the Company shall not be liable for indemnification under this
paragraph to the extent that any such loss, claim, damage, or liability is
determined, in a final judgment by a court of competent jurisdiction to
have resulted from Wedbush Xxxxxx'x bad faith or gross negligence.
5. Termination. The engagement hereunder and this Agreement may be terminated
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at any time by either party upon written notice to the other party,
effective upon receipt of written notice to that effect by the other party,
or automatically upon consummation of the Transaction. The provisions of
Sections 2, 3, 4, 7 and 8 shall survive any such termination.
6. Arbitration. Any claim or dispute arising out of this Agreement or the
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alleged breach thereof shall be submitted by the parties to binding and
non-appealable arbitration before the National Association of Securities
Dealers ("NASD") to be held in Los Angeles, California. If the NASD is
unavailable as a forum, the New York Stock Exchange ("NYSE") will be used.
Both parties shall attempt in good faith to seek mediation before
submitting to arbitration.
7. Miscellaneous.
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a. Successors and Assigns. This Agreement shall be binding on and inure to the
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benefit of each party's successors and assigns, but may not be assigned
without the prior written consent of the other party.
b. Governing Law. This Agreement shall be governed by and construed in
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accordance with the internal laws of the State of California, without
regard to conflict of laws or principles thereof.
c. Amendment. This Agreement may not be modified or amended except in writing
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signed by the parties hereto.
d. Entire Agreement. This Agreement is entered into by each of the parties
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hereto without reliance on any statement, representation, promise,
inducement or agreement not expressly contained within this Agreement. With
respect to the subject matter
MEMBER NEW YORK STOCK EXCHANGE
hereof, this Agreement constitutes the entire agreement between the
parties and supersedes all prior oral or written agreements.
e. Corporate Obligation. The obligations of Wedbush Xxxxxx and the Company
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hereunder are solely corporate obligations, and no officer, director,
employee, agent, shareholder or controlling person shall be subject to any
personal liability whatsoever to any person, nor will any such claim be
asserted by or on behalf of the Company or any of its affiliates.
8. Opinions and Advice. All opinions and advice, whether written or oral,
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rendered by Wedbush Xxxxxx to the Company pursuant to this Agreement are
intended solely for the Company's benefit and use in considering the
Transaction. No such opinions or advice may be disclosed to third parties
without Wedbush Xxxxxx'x prior written consent.
9. Wedbush Xxxxxx acknowledges that it has been retained to act solely as an
advisor to the Company and not as an advisor to Atari, Inc. or any other
entity. Atari, Inc. will not be deemed to have any obligations under this
agreement.
If the foregoing correctly sets forth your understanding and intentions, please
so indicate by signing and returning to us the enclosed copy of this letter.
Sincerely,
WEDBUSH XXXXXX SECURITIES INC.
By: ______________________________
Xxxx Xxxxxx
Managing Director
Head of Investment Banking
APPROVED AND ACCEPTED
ON January 7th, 2005:
CALIFORNIA U.S. HOLDINGS, INC.
By: /s/ Xxxxx Xxxxxxx
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Name: Xx. Xxxxx Xxxxxxx
Title: Chairman
MEMBER NEW YORK STOCK EXCHANGE
