UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C. 20549
      Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2008ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number 1-12367
      MIDWAY GAMES INC.
 (Exact name of registrant as
    specified in its charter)
  Delaware

22-2906244(State or other jurisdiction of
    incorporation or organization)

(I.R.S. Employer
    Identification No.)2704 West Roscoe Street, Chicago, Illinois

60618(Address of principal executive offices)

(Zip Code)   Registrants telephone number, including area code:
    (773) 961-2222
  Securities registered pursuant to Section 12(b) of the
    Act:
   Title of Each Class

Name of Each Exchange on Which Registered   Securities registered pursuant to Section 12(g) of the
    Act:
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. Yes o þ
  Rule 12b-2
 Large
    accelerated
    filer o
    Accelerated
    filer o
    Non-accelerated
    filer o
    Smaller
    reporting
    company þ   Rule 12b-2 o þ
     o o
    DOCUMENTS
    INCORPORATED BY REFERENCE:




---



##### 





Midway®

    is our registered trademark. Our product names mentioned in this
    report are also our trademarks, except where we license them.
    Other product names mentioned in this report are the trademarks
    of their respective owners.
  This report contains forward-looking statements
    within the meaning of the Private Securities Litigation Reform
    Act of 1995 which describe our plans, strategies and goals, our
    beliefs concerning future business conditions and our outlook
    based on currently available information that involves risks and
    uncertainties. Our actual results could differ materially from
    those anticipated in the forward-looking statements as a result
    of these risks and uncertainties, including, without limitation,
    (1) the ability of the Company to continue as a going
    concern; (2) the ability of the Company to develop, pursue,
    confirm and consummate one or more plans of reorganization with
    respect to the Chapter 11 cases; (3) the ability of
    the Company to obtain approval of and operate pursuant to the
    agreement with its secured creditor for the use of its cash
    collateral; (4) the ability of the Company to obtain court
    approval of the Companys motions in the Chapter 11
    proceeding pursued by it from time to time; (5) risks
    associated with third parties seeking and obtaining court
    approval to terminate or shorten the exclusivity period for the
    Company to propose and confirm one or more plans of
    reorganization, or the appointment of a Chapter 11 trustee
    or to convert the cases to Chapter 7 cases; (6) the
    ability of the Company to obtain and maintain normal terms with
    vendors and service providers; (7) the ability of the
    Company to maintain contracts that are critical to its
    operations; (8) potential adverse developments with respect
    to the Companys liquidity or results of operations;
    (9) the ability of the Company to fund and execute its
    business plan; (10) the ability of the Company to retain
    and compensate key executives and other key employees;
    (11) the ability of the Company to attract and retain
    customers; and (12) any further deterioration in the
    macroeconomic environment or consumer confidence. Where
    possible, we have identified these forward-looking statements by
    words such as may, will,
    should, could, expect,
    eventually, anticipate,
    plan, strategy, believe,
    estimate, seek, intend and
    similar expressions.
 2




---



##### 



MIDWAY
    GAMES, INC.
  2008
    FORM 10-K 
    TABLE OF CONTENTS
  PagePART IItem 1.


Business


4Item 1B.


Unresolved Staff Comments


17Item 2.


Properties


17Item 3.


Legal Proceedings


17Item 4.


Submission of Matters to a Vote of Security
    Holders


18PART IIItem 5.


Market for Registrants Common Equity,
    Related Shareholder Matters and Issuer Purchases of Equity
    Securities


20Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


20Item 8.


Financial Statements and Supplementary Data


42Item 9.


Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


42Item 9A.


Controls and Procedures


42Item 9B.


Other Information


42PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance(1)


42Item 11.


Executive Compensation(2)


42Item 12.


Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters(3)


43Item 13.


Certain Relationships and Related Transactions
    and Director Independence(4)


43Item 14.


Principal Accountant Fees and Services(5)


43PART IVItem 15.


Exhibits and Financial Statement Schedule


44Signatures      (1)
    Proxy Statement sections entitled Nominees for
    Directors, Board Committees and Meetings,
    Audit Committee Matters, Corporate
    Governance, and Section 16(a) Beneficial
    Ownership Reporting Compliance.(2)
    Proxy Statement sections entitled Compensation of
    Executive Officers and Directors, Compensation
    Committee Interlocks and Insider Participation and
    Reports of the Committees of the Board 
    Compensation Committee Report.(3)
    Proxy Statement sections entitled Beneficial Ownership of
    Directors and Executive Officers, Securities
    Authorized for Issuance under Equity Compensation Plans
    and Beneficial Ownership of More Than Five Percent of Any
    Class of Voting Securities.(4)
    Proxy Statement sections entitled Transactions with
    Related Persons, Promoters and Certain Control Persons and
    Director Independence.(5)
    Proxy Statement section entitled Independent
    Auditors Fees. 3




---



##### 



PART I  Item 1.
    Business.  Business
    Overview
  Xbox 360 Wii Nintendo DS
    (NDS), PlayStation 3
    (PS3) PlayStation Portable
    (PSP) PS3 Xbox GameCube (NGC) Game Boy Advance (GBA) PlayStation 2 (PS2)
  Form 10-K, Form 10-Q, Form 8-K
    Change in
    Control / Bankruptcy Filing
       4




---



##### 



debtors-in-possession
    Cost
    Reduction Initiatives
      Development
    of Our Business
  Mortal Kombat Mortal Kombat vs. DC Universe
 5




---



##### 




    Mortal Kombat vs. DC Universe(2008);
    TNA iMPACT!(2008);
    Unreal Tournament 3(2008);
    Game Party(2007);
    Stranglehold(2007);
    Rampage: Total Destruction(2007);
    Happy Feet(2006);
    Mortal Kombat: Armageddon(2006);
    Blitz: The League(2005);
    Mortal Kombat: Shaolin Monks(2005);
    Mortal Kombat: Deception(2004);
    NBA Ballers(2004);
    Midway Arcade Treasures(2003); and
    Mortal Kombat: Deadly Alliance(2002).  TNA Impact! Total NonStop Action Wrestling pay-per-view
  Wheelman Wheelman Wheelman
      Financing
    Arrangements
   6




---



##### 



Industry
    Overview
    The Home Console and Handheld Platform
    Market.
   7




---



##### 



project-by-project
    Previous Generation Home
    Consoles

Current Generation Home
    Consoles- Sonys PS2

- Sonys PS3- Nintendos NGC

- Nintendos Wii- Microsofts Xbox

- Microsofts Xbox 360   Xbox 360 Wii PS3
  Game Boy, GBA GBA SP NDS, PSP,
  The Personal Computer Game Market. Games for Windows
  The Online and Wireless Markets.
   8




---



##### 



Distribution.
  Our
    Business Strategy
    Leverage
    core competencies and established franchises
    
    Action/Fighting Games Midway has a
    demonstrated competency in fighting games such as Mortal
    Kombatand TNA iMPACT!. Many of the games we have
    released over the past 20 years have been best-sellers and
    have attracted loyal fan bases. The popularity of many of our
    games has enabled us to successfully market sequels, including
    sequels for Mortal Kombat.The latest sequel in the
    Mortal Kombatseries that we released in November 2008
    for PlayStation 3and Xbox 360, Mortal Kombat
    vs. DC Universe, proved to be our best selling game of 2008.
    The strength of our brands, the advanced nature of our
    technology, and our ability to leverage a common core fighting
    engine across our internal development teams gives us a
    strategic advantage in this genre both in terms of cost and
    quality.
    Open-World Games We have devoted significant
    resources to the development of open-world games that are more
    ambitious in terms of functionality and interaction. These games
    offer consumers increased playability and multiple experiences
    within a single video game, such as driving, fighting and
    shooting. Though we have not developed open-world games such as
    Wheelman (released in March 2009) and This is
    Vegas(scheduled for release in late 2009) in the past,
    we believe that our success with other action games increase our
    likelihood of success in this genre. Open-world video games
    produced by other publishers have been very successful, and we
    believe these types of games may develop into a source of
    increased revenue growth in the near future.
    Casual/Handheld Games Midway has a long
    history making the types of games that are ideal for the casual
    and the handheld game market: fun, fast-paced, short play-cycle
    games that appeal to a mass audience. In fact, many of the games
    we released into this market have been successful and
    profitable, such as Game Party, Game Party 2,
    TouchMasterand Midway Arcade Treasures. Game
    Party, a casual game initially released in November 2007 for
    Wii, has sold well over two million units. Its sequel,
    Game Party 2, was released in October 2008 and is
    anticipated to be similarly successful. We intend to continue to
    leverage our franchises to create popular titles for play on
    traditional console platforms and new gaming mediums. We also
    control the intellectual property rights to numerous classic
    video game titles, including titles originally released under
    the Midway, Williams and Atari brands. We have leveraged this
    large library of proven intellectual properties by releasing
    numerous collections of arcade classics for home
    consoles, handheld platforms and the PC.  Third-party
    and PC games markets
   9




---



##### 



Continue
    international presence
  Wheelman
  Products
  PS3 PSP Xbox
    360 Wii NDS Xbox, NGC GBA PS2
    Xbox Live
    Mortal Kombat
 10




---



##### 



2008
    Video Game Releases
    Video Game Title

Platform

TerritoryBlitz: The League II

PS3, Xbox 360

North America, InternationalGame Party 2 / More Game Party

Wii

North America, InternationalMechanic Master

NDS

North America, InternationalMidway Arcade.com

PC

North AmericaMortal Kombat Kollection

PS2

North AmericaMortal Kombat vs. DC Universe

PS3, Xbox 360

North America, InternationalMortal Kombat vs. DC Universe: Kollectors Edition

PS3, Xbox 360

North AmericaNBA Ballers: Chosen One

PS3, Xbox 360

North America, InternationalStranglehold: Expansion Pack

PS3, Xbox 360

North AmericaTNA iMPACT!

PS3, Xbox 360, Wii, PS2

North America, InternationalTouchMaster 2 / More TouchMaster

NDS

North America, InternationalUnreal Tournament 3

Xbox 360

North America, InternationalBlacksite: Area 51

PS3

InternationalCruisn

Wii

InternationalFosters Home for Imaginary Friends: Imagination
    Invaders

NDS

InternationalGame Party

Wii

InternationalHour of Victory

PC

InternationalPopStar Guitar

Wii

InternationalSins of a Solar Empire

PC

InternationalUnreal Tournament 3

PS3

International   2007
    Video Game Releases
    Video Game Title

Platform

TerritoryAqua Teen Hunger Force: Zombie Ninja
    Pro-Am

PS2

North America, InternationalBig Buck Hunter

PC

North AmericaBlacksite: Area 51

Xbox 360; PC

North America, InternationalBlacksite: Area 51

PS3

North AmericaBlitz: The League

Xbox 360

InternationalCocoto Racers

NDS

InternationalCruisn

Wii

North AmericaFosters Home for Imaginary Friends: Imagination
    Invaders

NDS

North AmericaGame Party

Wii

North AmericaHot Brain

PSP

North America, InternationalHour of Victory

Xbox 360

North America, InternationalMortal Kombat: Armageddon

Wii

North America, InternationalMyst

NDS

InternationalStranglehold

Xbox 360; PC; PS3

North America, InternationalThe Ant Bully

Wii

InternationalThe Bee Game

NDS; GBA

North AmericaThe Grim Adventures of Billy & Mandy

Wii

InternationalThe Lord of the Rings Online: Shadows of Angmar

PC

North AmericaTouchMaster

NDS

North America, InternationalUltimate Mortal Kombat

NDS

North America, InternationalUnreal Tournament 3

PC

North America, InternationalUnreal Tournament 3

PS3

North America  11




---



##### 



2009
    Products
  This Is Vegas, Xbox 360 PS3 Game Party 3 Wii Wheelman Xbox 360, PS3
  Product
    Development
                 12




---



##### 



Marketing
    and Distribution
    
    mass merchandisers;
    foreign, national and regional retailers;
    discount store chains; and
    video rental retailers.            13




---



##### 



Years Ended December 31,2008


2007


2006Net





Net





NetRevenues


%


Revenues


%


Revenues


%(Dollars in thousands)North America:United States

$
135,079



61.5
%

$
86,393



55.0
%

$
116,714



70.5
%Outside United States


8,654



4.0



10,307



6.5



7,398



4.5Total North America


143,733



65.5



96,700



61.5



124,112



75.0International


75,823



34.5



60,495



38.5



41,462



25.0Total Net Revenues

$
219,556



100.0
%

$
157,195



100.0
%

$
165,574



100.0
%   Competition
      
    the ability to select and develop popular titles;
    the ability to identify and obtain rights to commercially
    marketable intellectual properties; and
    the ability to adapt products for use with new technologies.        Mortal Kombat, Game Party TNA iMPACT!,
 14




---



##### 



Manufacturing
    and Distribution
      GBA NDS PSP
  agreed-upon
     15




---



##### 



Licenses
    and Intellectual Property
  Platform Licenses.
    Intellectual Property Licenses.
  Patent, Trademark and Copyright
    Protection.
  
    trademarks associated with elements of the game, such as team
    logos;
    trademarks under which the game is marketed;
    the copyrights for the game software, including the games
    audiovisual elements; and
    the patents for inventions in the game software.        Seasonality
   16




---



##### 



Employees
    Item 1B.
    Unresolved
    Staff Comments.    Item 2.
    Properties.      Item 3.
    Legal
    Proceedings.    U.S.-based No. 09-10465(KG). debtors-in-possession,
   17




---



##### 



Item 4.
    Submission
    of Matters to a Vote of Security Holders.   18




---



##### 



Executive Officers.
  Name and Age

Position(s) with MidwayMatthew V. Booty(42)

President and Chief Executive OfficerRyan G. ODesky(33)

Chief Financial Officer, Senior Vice President 
    Finance, Treasurer and Principal Accounting OfficerDeborah K. Fulton(45)

Senior Vice President, Secretary and General CounselMiguel Iribarren(42)

Senior Vice President  PublishingMartin Spiess(43)

Executive Vice President  International (Midway Games
    Limited)   Biographical
    Information
  Matthew V. Booty
  Ryan G. ODesky
  Deborah K. Fulton
  Miguel Iribarren
  Martin Spiess
 19




---



##### 



PART II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities.    Calendar Period

High


Low2007First Quarter

$
7.69


$
5.93Second Quarter

$
7.52


$
6.00Third Quarter

$
6.52


$
4.25Fourth Quarter

$
4.37


$
2.052008First Quarter

$
2.70


$
1.75Second Quarter

$
2.90


$
2.02Third Quarter

$
3.94


$
2.14Fourth Quarter

$
2.18


$
0.182009First Quarter (through February 12, 2009)

$
0.35


$
0.16     Dividends.
  Recent
    Sales of Unregistered Securities. None
  Issuer
    Repurchases. None.
  Purchases of Equity Securities by the Issuer and Affiliated
    Purchasers.
  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.  Overview
   20




---



##### 



PlayStation 2 PS2 PlayStation 3 PS3 PlayStation Portable PSP Xbox Xbox 360; Wii Nintendo
    DS NDS PS3 Xbox
    360 Wii.
  Increasing
    Costs to Develop Video Games
    Handheld
    Market
  NDS. PSP. PSP PSP NDS NDS PSP NDS
  PC
    Market
  Wheelman This Is Vegas Defender Joust Spy
    Hunter Mahki The
    Lord of the Rings Online: Shadows of Angmar Stranglehold Unreal Tournament 3
  Childrens
    Market
   21




---



##### 



Ed, Edd
    n Eddy The Ant Bully,
    The Grim Adventures of Billy & Mandy Happy
    Feet, Fosters Home
    for Imaginary Friends: Imagination Invaders.
  Strategic
    Alliances
  L.A. RUSH, PS2 Xbox, Wheelman
    Total
    NonStop Action Wrestling pay-per-view TNA iMPACT!
    Issuance
    of Convertible Senior Notes
      Stock-based
    Compensation
  Share-Based Payment Accounting for Stock-Based
    Compensation  Transition and Disclosure 
    An Amendment of FASB No. 123
 22




---



##### 



Majority
    Stockholder
        debtor-in-possession.
  Management
    and Business Developments
         23




---



##### 



Critical
    Accounting Policies and Estimates
    Revenue
    recognition
  97-2, Software Revenue Recognition.
   24




---



##### 



Price
    protection, returns and discounts
    Mortal Kombat vs. DC Universe
  Doubtful
    accounts
      Capitalized
    product development costs
  Accounting for the Costs of Computer
    Software to be Sold, Leased, or Otherwise Marketed
 25




---



##### 



product-by-product
    product-by-product
      Goodwill
  Goodwill and Other Intangible
    Assets
    Valuation
    of deferred tax assets
   26




---



##### 



Stock-Based
    Compensation
  Accounting for Stock-Based
    Compensation
     27




---



##### 



2008


2007


2006Expected life


5.0 Years



5.0 Years



5.0 YearsExpected volatility


0.60



0.58



0.70Dividend yield


0
%


0
%


0
%Risk-free interest rate


3.17
%


4.06
%


4.54
%Estimated annual forfeiture rate


16
%


15
%


15
%     Results
    of Operations
    Years Ended December 31,2008


2007


2006(Dollars in thousands)Net revenues

$
219,556



100.0
%

$
157,195



100.0
%

$
165,574



100.0
%Cost of sales:Product costs and distribution


87,400



39.8



56,413



35.9



67,331



40.7Royalties and product development


118,114



53.8



90,400



57.5



68,883



41.6Total cost of sales


205,514



93.6



146,813



93.4



136,214



82.3Gross profit


14,042



6.4



10,382



6.6



29,360



17.7Research and development expense


32,900



15.0



25,373



16.1



37,022



22.4Selling and marketing expense


52,297



23.8



42,960



27.3



43,150



26.1Administrative expense


28,032



12.8



21,226



13.5



21,297



12.8Restructuring and other charges (benefits)


14,299



6.5



(783
)


(0.5
)


(130
)


(0.1
)Operating loss


(113,486
)


(51.7
)


(78,394
)


(49.8
)


(71,979
)


(43.5
)Interest income


426



0.2



2,313



1.5



4,384



2.7Interest expense


(70,878
)


(32.3
)


(27,165
)


(17.3
)


(11,241
)


(6.8
)Other income (expense), net


(5,329
)


(2.4
)


2,902



1.8



2,699



1.6Loss before income taxes


(189,267
)


(86.2
)


(100,344
)


(63.8
)


(76,137
)


(46.0
)Provision (benefit) for income taxes


1,707



0.8



(752
)


(0.5
)


1,646



1.0Net loss

$
(190,974
)


(87.0
)%

$
(99,592
)


(63.3
)%

$
(77,783
)


(47.0
)%  28




---



##### 



Video Game Title

Year ReleasedMortal Kombat vs. DC Universe


2008TNA iMPACT!


2008Unreal Tournament 3


2008Game Party


2007Stranglehold


2007Rampage: Total Destruction


2007Happy Feet


2006Mortal Kombat: Armageddon


2006Blitz: The League


2005Mortal Kombat: Shaolin Monks


2005Mortal Kombat: Deception


2004NBA Ballers


2004Midway Arcade Treasures


2003Mortal Kombat: Deadly Alliance


2002   2008
    Compared with 2007
    Years Ended December 31,See





% of Net





% of Net


Increase/Explanation


2008


Revenues


2007


Revenues


(Decrease)


% ChangeConsolidated net revenues


A


$
219,556



100.0
%

$
157,195



100.0
%

$
62,361



39.7
%North American net revenues


B



143,733



65.5
%


96,700



61.5
%


47,033



48.6
%International net revenues


C



75,823



34.5
%


60,495



38.5
%


15,328



25.3
%Cost of sales:Product costs and distribution


D



87,400



39.8
%


56,413



35.9
%


30,987



54.9
%Royalties and product development


E



118,114



53.8
%


90,400



57.5
%


27,714



30.7
%Research and development expense


F



32,900



15.0
%


25,373



16.1
%


7,527



29.7
%Selling and marketing expense


G



52,297



23.8
%


42,960



27.3
%


9,337



21.7
%Administrative expense


H



28,032



12.8
%


21,226



13.5
%


6,806



32.1
%Restructuring and other charges (benefits)


I



14,299



6.5
%


(783
)


(0.5
)%


15,082



1926.2
%Interest income


J



426



0.2
%


2,313



1.5
%


(1,887
)


(81.6
)%Interest expense


K



(70,878
)


(32.3
)%


(27,165
)


(17.3
)%


43,713



160.9
%Other income (expense), net


L



(5,329
)


(2.4
)%


2,902



1.8
%


(8,231
)


(283.6
)%Provision (benefit) for income taxes


M



1,707



0.8
%


(752
)


(0.5
)%


2,459



327.0
%  29




---



##### 



A.
    Consolidated
    Net Revenues    Years Ended December 31,2008


2007Sony PlayStation 3

$
60,783



27.7
%

$
26,811



17.1
%Microsoft Xbox 360


65,721



29.9



45,555



29.0Nintendo Wii


52,323



23.8



15,762



10.0Sony PlayStation 2


12,642



5.8



12,843



8.2Microsoft Xbox


(18
)






834



0.5Nintendo GameCube


(11
)






875



0.6Sony PlayStation Portable


2,614



1.2



3,769



2.4Nintendo DS


15,816



7.2



13,138



8.4Nintendo Game Boy Advance


30







1,680



1.1Personal Computer


2,799



1.3



30,961



19.7Royalties and other


6,857



3.1



4,967



3.0Total Consolidated Net Revenues

$
219,556



100.0
%

$
157,195



100.0
%   per-unit Mortal Kombat vs. DC Universe Unreal Tournament 3 The Lord of the Rings Online:
    Shadows of Angmar per-unit Form 10-K
  TNA iMPACT! Unreal Tournament 3 Xbox 360 Mortal Kombat vs. DC Universe, NBA Ballers: Chosen One Stranglehold Unreal Tournament 3 PS3 Blacksite: Area 51, The Lord of the
    Rings: Shadows of Angmar
  B.
    North
    American Net Revenues  Mortal Kombat vs. DC
    Universe, Game Party TNA iMPACT!. Stranglehold, Unreal Tournament 3 Blacksite: Area
    51.
  C.
    International
    Net Revenues  Mortal Kombat vs. DC Universe,
    Game Party Unreal Tournament 3 Xbox
    360 PS3 Stranglehold, Unreal Tournament
    3, Blacksite: Area 51
 30




---



##### 



D.
    and E.
    Cost of Sales  Product
    Costs and Distribution
  per-unit Mortal Kombat vs. DC Universe
  Royalties
    and Product Development
  Mortal Kombat vs. DC Universe Game Party Unreal
    Tournament 3
    Years Ended December 31,Description

2008


2007Amortization of capitalized product development costs

$
43,710,000


$
55,092,000Writedowns related to future releases


16,259,000



8,732,000Writedowns related to current releases


9,445,000



2,404,000Total

$
69,414,000


$
66,228,000   F.
    Research
    and Development Expense    Years Ended December 31,Description

2008


2007Gross research and development costs

$
95,379,000


$
104,187,000Research and development costs capitalized


(62,479,000
)


(78,814,000
)Research and development expense

$
32,900,000


$
25,373,000     G.
    Selling
    and Marketing Expense  Mortal Kombat vs. DC Universe TNA iMPACT!.
 31




---



##### 



H.
    Administrative
    Expense    I.
    Restructuring
    and Other Charges (Benefits)          Years Ended December 31,Description

2008


2007Game cancellation  reversal of research and
    development costs capitalized

$
10,242,000


$
Expense reduction programs and severance


4,135,000



Reversals of previously accrued charges, net


(78,000
)


(783,000
)Total

$
14,299,000


$
(783,000
)   J.
    Interest
    Income    K.
    Interest
    Expense     32




---



##### 



L.
    Other
    Income, net    M.
    Provision
    for Income Taxes    2007
    Compared with 2006
    Years Ended December 31,See





% of Net





% of Net


Increase/Explanation


2007


Revenues


2006


Revenues


(Decrease)


% ChangeConsolidated net revenues


A


$
157,195



100.0
%

$
165,574



100.0
%

$
(8,379
)


(5.1
)%North American net revenues


B



96,700



61.5
%


124,112



75.0
%


(27,412
)


(22.1
)%International net revenues


C



60,495



38.5
%


41,462



25.0
%


19,033



45.9
%Cost of sales:Product costs and distribution


D



56,413



35.9
%


67,331



40.7
%


(10,918
)


(16.2
)%Royalties and product development


E



90,400



57.5
%


68,883



41.6
%


21,517



31.2
%Research and development expense


F



25,373



16.1
%


37,022



22.4
%


(11,649
)


(31.5
)%Selling and marketing expense


G



42,960



27.3
%


43,150



26.1
%


(190
)


(0.4
)%Administrative expense


H



21,226



13.5
%


21,297



12.8
%


(71
)


(0.3
)%Restructuring and other charges (benefits)


I



(783
)


(0.5
)%


(130
)


(0.1
)%


653



502.3
%Interest income


J



2,313



1.5
%


4,384



2.7
%


(2,071
)


(47.2
)%Interest expense


K



(27,165
)


(17.3
)%


(11,241
)


(6.8
)%


15,924



141.7
%Other income, net


L



2,902



1.8
%


2,699



1.6
%


203



7.5
%Provision for income taxes


M



(752
)


(0.5
)%


1,646



1.0
%


(2,398
)


(145.7
)%  33




---



##### 



A.
    Consolidated
    Net Revenues    Years Ended December 31,2007


2006Sony PlayStation 3

$
26,811



17.1
%

$





%Microsoft Xbox 360


45,555



29.0



3,469



2.1Nintendo Wii


15,762



10.0



11,456



6.9Sony PlayStation 2


12,843



8.2



75,955



45.8Microsoft Xbox


834



0.5



14,602



8.8Nintendo GameCube


875



0.6



11,184



6.8Sony PlayStation Portable


3,769



2.4



13,845



8.4Nintendo DS


13,138



8.4



9,870



6.0Nintendo Game Boy Advance


1,680



1.1



9,417



5.7Personal Computer


30,961



19.7



9,307



5.6Royalties and other


4,967



3.0



6,469



3.9Total Consolidated Net Revenues

$
157,195



100.0
%

$
165,574



100.0
%   per-unit Xbox 360 PlayStation 3 per-unit Stranglehold, Blacksite: Area 51, Unreal
    Tournament 3 Form 10-K
  Stranglehold Unreal Tournament 3 PS3 Blacksite: Area 51, The Lord
    of the Rings: Shadows of Angmar Happy Feet The Ant Bully Rise and Fall: Civilizations at War, Mortal Kombat: Armageddon PS2 Xbox
  B.
    North
    American Net Revenues  Stranglehold, Unreal Tournament
    3 Blacksite: Area 51. Mortal Kombat: Armageddon Happy Feet, Rampage: Total Destruction
  C.
    International
    Net Revenues  Stranglehold, Unreal
    Tournament 3, Blacksite: Area 51 Happy Feet,
    Rise & Fall: Civilizations at War Mortal
    Kombat: Armageddon.
 34




---



##### 



D.
    and E.
    Cost of Sales  Product
    Costs and Distribution
  per-unit Xbox 360 PlayStation
    3
  Royalties
    and Product Development
  Unreal Tournament 3 Stranglehold Lord of the Rings Online: Shadows of
    Angmar
    Years Ended December 31,Description

2007


2006Amortization of capitalized product development costs

$
55,092,000


$
53,628,000Writedowns related to future releases


8,732,000



Writedowns related to current releases


2,404,000



1,696,000Total

$
66,228,000


$
55,324,000   F.
    Research
    and Development Expense    Years Ended December 31,Description

2007


2006Gross research and development costs

$
104,187,000


$
106,364,000Research and development costs capitalized


(78,814,000
)


(69,342,000
)Research and development expense

$
25,373,000


$
37,022,000    35




---



##### 



G.
    Selling
    and Marketing Expense    H.
    Administrative
    Expense    I.
    Restructuring
    and Other Charges (Benefits)    Years Ended December 31,Description

2007


2006Reversals of previously accrued charges, net


(783,000
)


(130,000
)Total

$
(783,000
)

$
(130,000
)   J.
    Interest
    Income    K.
    Interest
    Expense      L.
    Other
    Income, net   36




---



##### 



M.
    Provision
    for Income Taxes    Impact of
    Recently Issued Accounting Pronouncements
  Fair Value Measurements
  SFAS No. 157-3, Determining the Fair Value of a Financial Asset When the
    Market for That Asset Is Not Active SFAS No. 157-3
  The
    Fair Value Option for Financial Assets and Financial Liabilities
  No. 142-3, Determination of the Useful Life of Intangible Assets No. 142-3 No. 142-3 SFAS No. 142-3 No. 142-3 SFAS No. 142-3
 37




---



##### 



SOP 90-7-1, An Amendment of AICPA Statement of Position
    90-7 SOP 90-7-1). SOP 90-7-1
  Liquidity
    and Capital Resources
  Overview
        Operating
    Activities
     38




---



##### 



Investing
    Activities
    Financing
    Activities
    Financing
    Arrangements and Factoring Agreement
         39




---



##### 



40




---



##### 



Impact of
    Inflation
   41




---



##### 



Seasonality
    Item 8.
    Financial
    Statements and Supplementary Data    Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure.    Item 9A.
    Controls
    and Procedures.  Disclosure
    Controls and Procedures.
  Rule 13a-15(b)
  Internal
    Control over Financial Reporting.
  Managements Annual Report on Internal Control over
    Financial Reporting. page F-2
  page F-4
  Changes in Internal Control over Financial
    Reporting. Rule 13a-15(d)
  Item 9B.
    Other
    Information.   PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance.  Form 10-K.
  Item 11.
    Executive
    Compensation.   42




---



##### 



Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters.    Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence.    Item 14.
    Principal
    Accountant Fees and Services.   43




---



##### 



PART IV  Item 15.
    Exhibits
    and Financial Statement Schedule.  Financial Statements. page F-1.
  Financial Statement Schedule. page F-1.
  Exhibits.
  ExhibitNo.

Description3
.1

Amended and Restated Certificate of Incorporation of the
    Registrant dated October 25, 1996, incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-1/A,
    as amended, File
    No. 333-11919,
    filed on October 18, 1996 and effective October 29,
    1996 (the
    S-1
    Registration Statement).3
.2

Certificate of Amendment to the Amended and Restated Certificate
    of Incorporation of the Registrant dated February 25, 1998,
    incorporated herein by reference to the Registrants
    Registration Statement on
    Form 8-A/A,
    Amendment No. 1, filed on April 20, 1998.3
.3

Certificate of Amendment to the Amended and Restated Certificate
    of Incorporation of the Registrant dated August 5, 2003,
    incorporated herein by reference to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2003.3
.4

Certificate of Amendment of the Amended and Restated Certificate
    of Incorporation of the Registrant dated February 17, 2004,
    incorporated herein by reference to the Registrants
    Registration Statement on
    Form S-3,
    File
    No. 333-113077,
    initially filed on February 25, 2004.3
.5

Amended and Restated By-laws of the Registrant, incorporated
    herein by reference to the Registrants Registration
    Statement on
    Form S-3,
    File
    No. 333-116334,
    initially filed on June 10, 2004 (the 6/10/04
    S-3).3
.6

Composite Amended and Restated By-laws of the Registrant dated
    June 13, 2007, incorporated herein by reference to the
    Registrants Current Report on
    Form 8-K
    filed on May 3, 2007.4
.1

Indenture, dated as of September 19, 2005, between the
    Registrant and Wells Fargo Bank, National Association,
    incorporated herein by reference to the Registrants
    current report on
    Form 8-K
    filed on September 19, 2005 (the 9/19/2005
    8-K).4
.2

Registration Rights Agreement, dated as of September 19,
    2005 between the Registrant and Banc of America Securities, LLC,
    as representative of the Initial Purchasers, incorporated herein
    by reference to the 9/19/2005
    8-K.4
.3

Indenture, dated as of May 30, 2006, between the Registrant
    and Wells Fargo Bank, National Association, incorporated herein
    by reference to the Registrants Current Report on
    Form 8-K
    filed on May 30, 2006 (the 5/30/06
    8-K).4
.4

Registration Rights Agreement, dated as of May 30, 2006,
    between the Registrant and Banc of America Securities, LLC,
    incorporated herein by reference to the 5/30/06
    8-K.4
.5

Notice of Adjustment, dated July 13, 2006, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K
    filed on July 14, 2006.4
.6

Notice of Adjustment, dated April 30, 2007, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K
    filed on April 30, 2007.4
.7

Notice of Adjustment, dated August 22, 2007, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K
    filed on August 27, 2007.10
.1*

1996 Stock Option Plan, incorporated herein by reference to the
    Registrants Registration statement on
    Form S-1/A,
    as amended, File
    No. 333-11919,
    filed on October 25, 1996 and effective October 29,
    1996.10
.2*

1998 Non-Qualified Stock Option Plan, incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-8,
    filed on June 24, 1998 (File
    No. 333-57583).10
.3*

1998 Stock Incentive Plan, incorporated herein by reference to
    the Registrants Registration Statement on
    Form S-8,
    filed on December 4, 1998 (File
    No. 333-68373). 44




---



##### 



ExhibitNo.

Description10
.4*

1999 Stock Option Plan, incorporated herein by reference to the
    Registrants Registration Statement on
    Form S-8,
    filed on March 5, 1999 (File
    No. 333-73451).10
.5*

2000 Non-Qualified Stock Option Plan, incorporated herein by
    reference to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended June 30, 2000, filed on
    September 26, 2000.10
.6*

Amendment to 1998 Stock Incentive Plan, incorporated herein by
    reference to the Registrants Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2001, filed on
    November 14, 2001.10
.7*

2002 Stock Option Plan, incorporated herein by reference to the
    Registrants definitive proxy statement filed on
    December 5, 2001.10
.8*

Letter Agreement dated as of March 21, 2001, between the
    Registrant and Thomas E. Powell regarding Mr. Powells
    employment by the Registrant, incorporated herein by reference
    to the Registrants Transition Report on
    Form 10-KT-405
    for the six-month transition period ended December 31,
    2001, filed on March 28, 2002.10
.9*

2002 Non-Qualified Stock Option Plan, incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-8,
    filed on August 26, 2002 (File
    No. 333-98745).10
.10*

Letter Agreement dated as of February 10, 2003 between the
    Registrant and Thomas E. Powell regarding Mr. Powells
    employment by the Registrant, incorporated herein by reference
    to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2002 filed with the
    SEC on March 28, 2003.10
.11*

Executive Employment Agreement made as of May 6, 2003,
    between the Registrant and David Zucker, incorporated herein by
    reference to the Registrants Current Report on
    Form 8-K
    filed on May 7, 2003 (the 5/7/03
    8-K).10
.12*

Stock Option Agreement made as of May 6, 2003, between the
    Registrant and David Zucker, incorporated herein by reference to
    the 5/7/03
    8-K.10
.13*

Stock Option Agreement under 2002 Stock Option Plan made as of
    May 6, 2003, between the Registrant and David Zucker,
    incorporated herein by reference to the 5/7/03
    8-K.10
.14*

Restricted Stock Agreement entered into as of May 6, 2003,
    between the Registrant and David Zucker, incorporated herein by
    reference to the 5/7/03
    8-K.10
.15

PlayStation®

    2 CD-ROM/DVD-ROM Licensed Publisher Agreement dated
    April 1, 2000 between Sony Computer Entertainment America
    Inc. and Midway Home Entertainment Inc., incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-3/A,
    filed on August 18, 2003 (the August 2003
    S-3/A).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 406 under the Securities Act of 1933, as amended.)10
.16

PlayStation®

    2 Licensed Publisher Agreement dated November 14, 2000
    between Sony Computer Entertainment Europe Limited and Midway
    Games Limited, incorporated herein by reference to the August
    2003 S-3/A.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 406 under the Securities Act of 1933, as amended.).10
.17*

Waiver, dated as of April 5, 2004, by David F. Zucker,
    incorporated herein by reference to the Registrants
    Current Report on
    Form 8-K
    filed on April 13, 2004.10
.18*

Amendment to Stock Option Plans of the Registrant, incorporated
    herein by reference to the 6/10/04
    S-3.10
.19

Letter Agreement entered into as of September 20, 2004
    amending the
    PlayStation®2

    CD-ROM/DVD-ROM Licensed Publisher Agreement effective as of
    April 1, 2000 between Sony Computer Entertainment America
    Inc. and Midway Home Entertainment Inc., incorporated herein by
    reference to the Registrants Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended on September 30, 2004, filed
    on November 8, 2004 (the 9/30/2004
    10-Q).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.) 45




---



##### 



ExhibitNo.

Description10
.20*

First Amendment to Restricted Stock Agreement made as of
    October 18, 2004, between the Registrant and David F.
    Zucker, incorporated herein by reference to the 9/30/2004
    10-Q.10
.21*

2000 Stock Option/Stock Issuance Plan for Midway
    Studios  Austin Inc. and Form of Stock Option
    Agreement, incorporated herein by reference to the
    Registrants Registration Statement on
    Form S-8,
    File
    No. 333-120347,
    filed on November 10, 2004.10
.22*

2004 Form of Indemnification Agreement authorized to be entered
    into between the Registrant and officers and directors of the
    Registrant, incorporated herein by reference to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2004, filed on
    March 14, 2005 (the 2004
    10-K).10
.23*

Form of Stock Option Agreement For Directors used currently by
    the Registrant for directors under its stock option plans,
    incorporated herein by reference to the 2004
    10-K.10
.24*

Form of Stock Option Agreement For Employees used currently by
    the Registrant for employees under its stock option plans,
    incorporated herein by reference to the 2004
    10-K.10
.25*

Amended and Restated Midway Incentive Plan, incorporated herein
    by reference to the 2004
    10-K.10
.26*

2005 Long-Term Incentive Plan, incorporated herein by reference
    to the Registrants definitive proxy statement filed on
    April 29, 2005 (File
    No. 001-12367).10
.27*

Form of Stock Option Agreement used currently by the Registrant
    for employees under its 2005 Long-Term Incentive Plan,
    incorporated herein by reference to the 6/30/2005
    10-Q.10
.28*

Form of Restricted Stock Agreement used currently by the
    Registrant for management under its 2005 Long-Term Incentive
    Plan, incorporated herein by reference to the Registrants
    Current Report on
    Form 8-K
    filed on October 7, 2005.10
.29*

Form of Non-Employee Director Stock Option Agreement under the
    2005 Long-Term Incentive Plan incorporated herein by reference
    to the Registrants Current Report on
    Form 8-K
    filed on September 12, 2006.10
.30

Xbox 360 Publisher License Agreement entered into as of
    October 25, 2006 by and between Microsoft Licensing, GP and
    Midway Home Entertainment Inc., incorporated herein by reference
    to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2006, filed on
    March 12, 2007. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.31

Amended and Restated Loan and Security Agreement by and among
    the Registrant, specified subsidiaries of the Registrant, the
    lenders thereto, and Wells Fargo Foothill, Inc., dated as of
    June 29, 2007, incorporated herein by reference to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007.10
.32

First Amendment to Amended and Restated Loan and Security
    Agreement by and among the Registrant, specified subsidiaries of
    the Registrant, the lenders thereto and Wells Fargo Foothill,
    Inc., dated as of July 31, 2007, incorporated herein by
    reference to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007.10
.33

Unreal®

    Engine 3 License Agreement by and between Epic Games, Inc.
    (Epic) and Midway Home Entertainment Inc.
    (MHEI), dated as of January 14, 2005,
    incorporated herein by reference to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.34

Amendment No. 1 to
    Unreal®

    Engine 3 License Agreement by and between Epic and MHEI, dated
    as of December 5, 2005 incorporated herein by reference to
    the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.35*

Second Form of Restricted Stock Agreement used by the Registrant
    for management under its 2005 Long-Term Incentive Plan,
    incorporated herein by reference to Registrants Quarterly
    Report on
    Form 10-Q
    for the quarter ended September 30, 2007, filed on
    November 1, 2007. 46




---



##### 



ExhibitNo.

Description10
.36

Waiver and Second Amendment to Amended and Restated Loan and
    Security Agreement by and among the Registrant, specified
    subsidiaries of the Registrant, the lenders thereto and Wells
    Fargo Foothill, Inc., dated as of January 2, 2008
    incorporated herein by reference to the Registrants Annual
    Report on
    Form 10-K
    for the year ended December 31, 2007, filed on
    March 14, 2008 (the 2007
    10-K).10
.37*

Confidential Settlement Agreement and General Release by and
    between the Registrant and Steven M. Allison dated
    January 24, 2008 incorporated herein by reference to the
    2007 10-K.10
.38

Amendment to the Xbox 360 Publisher License Agreement effective
    as of October 12, 2007 between Microsoft Licensing, GP and
    Midway Home Entertainment Inc. incorporated herein by reference
    to the 2007
    10-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.39

Confidential License Agreement for the Wii Console between
    Nintendo of America Inc. and Midway Home Entertainment Inc.
    effective November 19, 2006 incorporated herein by
    reference to the Registrants Current Report on
    Form 10-K/A,
    Amendment No. 2 filed on October 27, 2008 (the
    2007
    10-K/A).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.40

License Agreement for the Nintendo DS System (EEA, Australia and
    New Zealand) dated June 18, 2006 between Nintendo Co., Ltd.
    and Midway Games Limited incorporated herein by reference to the
    2007 10-K/A.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.41*

Sales Incentive Bonus Plan for Martin Spiess dated
    April 20, 2007 incorporated herein by reference to the 2007
    10-K/A.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.42

Loan and Security Agreement by and among the Registrant,
    specified subsidiaries of the Registrant, and National
    Amusements, Inc., dated as of February 29, 2008
    incorporated herein by reference to the 2007
    10-K.10
.43

Continuing Guaranty dated as of February 29, 2008, between
    the Registrant and specified subsidiaries in favor of National
    Amusements, Inc. incorporated herein by reference to the 2007
    10-K.10
.44

Intercompany Subordination Agreement dated as of
    February 29, 2008 among the Registrant, specified
    subsidiaries of the Registrant and National Amusements, Inc.
    incorporated herein by reference to the 2007
    10-K.10
.45

Unsecured Loan Agreement dated as of February 29, 2008, by
    and between the Registrant and National Amusements, Inc.
    incorporated herein by reference to the 2007
    10-K.10
.46

Unsecured Subordinated Loan Agreement dated as of February 29
    2008, by and between the Registrant and National Amusements Inc.
    incorporated herein by reference to the 2007
    10-K.10
.47*

Letter Agreement dated as of March 19, 2008 between Midway
    Games Inc. and Matthew V. Booty, incorporated herein by
    reference to the Registrants Current Report on
    Form 8-K,
    filed on March 20, 2008.10
.48*

Memorandum to Matthew V. Booty Regarding Performance-Based
    Bonuses for Interim CEO and President dated April 8, 2008,
    incorporated herein by reference to the Registrants
    Current Report on
    Form 8-K/A,
    Amendment No. 2, filed on October 21, 2008. Portions
    of this exhibit have been omitted pursuant to a request for
    confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.10
.49*

Midway Games Inc. Memorandum to Ryan ODesky Regarding
    Terms of Employment dated April 8, 2008, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K,
    filed on April 11, 2008 (the 4/11/08
    8-K).10
.50*

Midway Games Limited Memorandum to Martin Spiess Regarding Terms
    of Employment dated April 8, 2008, incorporated herein by
    reference to the 4/11/08
    8-K. 47




---



##### 



ExhibitNo.

Description10
.51*

Midway Games Limited Memorandum to Martin Spiess Regarding Sales
    Incentive Bonus Plan dated April 8, 2008, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K/A,
    Amendment No. 1, filed on October 21, 2008. (Portions
    of this exhibit have been omitted pursuant to a request for
    confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.52

Factoring Agreement by and among National Amusements, Inc.,
    Midway Home Entertainment Inc., and Midway Amusement Games, LLC
    dated September 15, 2008 incorporated herein by reference
    to the Registrants Current Report on
    Form 8-K
    filed on September 18, 2008 (the 9/18/08
    8-K).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.53

Amendment No. 2 to Loan and Security Agreement by and among
    the Registrant, specified subsidiaries of the Registrant, and
    National Amusements, Inc., dated as of September 15, 2008
    incorporated herein by reference to the 9/18/08
    8-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.54

Amendment No. 2 to Unsecured Loan Agreement, by and between
    the Registrant and National Amusements Inc., dated as of
    September 15, 2008 incorporated herein by reference to the
    9/18/08 8-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.55

Amendment No. 2 to Unsecured Subordinated Loan Agreement by
    and between the Registrant and National Amusements Inc., dated
    as of September 15, 2008 incorporated herein by reference
    to the 9/18/08
    8-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.56

Global PlayStation 3 Format Licensed Publisher Agreement
    effective as of September 26, 2008 by and between Sony
    Computer Entertainment America Inc. and Midway Home
    Entertainment, Inc. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with Rule
    24b-2 under
    the Securities Exchange Act of 1934, as amended.)10
.57

Amendment No. 1 to Loan and Security Agreement by and among
    the Registrant, specified subsidiaries of the Registrant, and
    National Amusements, Inc., dated as of August 19, 2008.10
.58

Amendment No. 1 to Unsecured Loan Agreement, by and between
    the Registrant and National Amusements Inc., dated as of
    August 19, 2008.10
.59

Amendment No. 1 to Unsecured Subordinated Loan Agreement by
    and between the Registrant and National Amusements Inc., dated
    as of August 19, 2008.21


Subsidiaries of the Registrant.23


Consent of Ernst & Young LLP.31


Certifications of Chief Executive Officer and Chief Financial
    Officer Pursuant to
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934, as amended, as
    Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.32


Certifications of Chief Executive Officer and Chief Financial
    Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
    Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*


Indicates a management contract or compensatory plan or
    arrangement.  48




---



##### 



MIDWAY
    GAMES INC.
  INDEX TO
    FINANCIAL INFORMATION
   
 Page No.Financial Statements and Financial Statement ScheduleManagement Report on Internal Control over
    Financial Reporting


F-2Reports of Independent Registered Public
    Accounting Firm


F-3Consolidated Balance Sheets at December 31,
    2008 and 2007


F-5Consolidated Statements of Operations for the
    years ended December 31, 2008, 2007 and 2006


F-6Consolidated Statements of Changes in
    Stockholders Equity (Deficit) for the years ended
    December 31, 2008, 2007 and 2006


F-7Consolidated Statements of Cash Flows for the
    years ended December 31, 2008, 2007 and 2006


F-8Notes to Consolidated Financial Statements


F-9Financial Statement Schedule II 
    Valuation and Qualifying Accounts for the years ended
    December 31, 2008, 2007 and 2006


F-39     F-1




---



##### 



MANAGEMENT
    REPORT ON INTERNAL CONTROL
    OVER FINANCIAL REPORTING  Rule 13a-15(f) 15d-15(f)
  Internal Control 
    Integrated Framework.
    page F-4.
 F-2




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM             Internal Control  Integrated
    Framework
      F-3




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
    ON INTERNAL CONTROL OVER FINANCIAL REPORTING
     Internal Control 
    Integrated Framework
                F-4




---



##### 



MIDWAY
    GAMES INC.
  CONSOLIDATED
    BALANCE SHEETS
  December 31,2008


2007(In thousands, except share and per share amounts)ASSETSCurrent assets:Cash and cash equivalents

$
23,021


$
27,524Restricted cash


213



Receivables, less allowances of $28,443 and $32,510 at
    December 31, 2008 and 2007, respectively


46,246



44,527Inventories


5,782



3,772Capitalized product development costs


36,528



51,252Prepaid expenses and other current assets


13,463



13,362Total current assets


125,253



140,437Restricted cash


887



Assets held for sale


2,464



Capitalized product development costs


494



2,947Property and equipment, net


9,512



19,298Goodwill


40,822



41,307Other assets


1,788



9,372Total assets

$
181,220


$
213,361LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current liabilities:Accounts payable

$
31,211


$
29,642Due to factor


2,883



Accrued compensation and related benefits


11,308



6,134Accrued royalties


28,850



12,769Accrued selling and marketing


6,300



5,645Deferred revenue


3,471



2,940Current portion of long-term debt


88,931



Convertible senior notes, less unamortized discount of $13,994
    at December 31, 2008


136,006



Other accrued liabilities


18,680



14,190Total current liabilities


327,640



71,320Convertible senior notes, less unamortized discount of $67,802
    at December 31, 2007






82,198Long-term debt






19,167Deferred income taxes


12,028



10,715Other noncurrent liabilities


541



880Commitments and contingencies (Note 16)Stockholders equity (deficit):Preferred stock, $0.01 par value, 5,000,000 shares
    authorized and undesignated






Common stock, $0.01 par value, 200,000,000 shares
    authorized; 93,540,355 and 93,268,699 shares issued at
    December 31, 2008 and 2007, respectively


935



933Additional paid-in capital


522,453



521,031Accumulated deficit


(671,448
)


(480,474
)Accumulated translation adjustment


(1,146
)


(2,629
)Treasury stock, at cost, 1,445,430 and 1,165,430 shares at
    2008 and 2007, respectively


(9,783
)


(9,780
)Total stockholders equity (deficit)


(158,989
)


29,081Total liabilities and stockholders equity (deficit)

$
181,220


$
213,361    F-5




---



##### 



MIDWAY
    GAMES INC.
  CONSOLIDATED
    STATEMENTS OF OPERATIONS
  Years Ended December 31,2008


2007


2006(In thousands, except per share amounts)Net revenues

$
219,556


$
157,195


$
165,574Cost of sales:Product costs and distribution


87,400



56,413



67,331Royalties and product development


118,114



90,400



68,883Total cost of sales


205,514



146,813



136,214Gross profit


14,042



10,382



29,360Research and development expense


32,900



25,373



37,022Selling and marketing expense


52,297



42,960



43,150Administrative expense


28,032



21,226



21,297Restructuring and other charges (benefits)


14,299



(783
)


(130
)Operating loss


(113,486
)


(78,394
)


(71,979
)Interest income


426



2,313



4,384Interest expense


(70,878
)


(27,165
)


(11,241
)Other income (expense), net


(5,329
)


2,902



2,699Loss before income taxes


(189,267
)


(100,344
)


(76,137
)Provision (benefit) for income taxes


1,707



(752
)


1,646Net loss

$
(190,974
)

$
(99,592
)

$
(77,783
)Basic and diluted loss per share of common stock

$
(2.08
)

$
(1.09
)

$
(0.86
)Average number of shares outstanding


91,605



91,167



90,708    F-6




---



##### 



MIDWAY
    GAMES INC.
  CONSOLIDATED
    STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
    (DEFICIT)
  Common StockAdditional





Accumulated





Treasury


TotalNumber


Par


Paid-In


Accumulated


Translation


Deferred


Stock At


Stockholdersof Shares


Value


Capital


Deficit


Adjustment


Compensation


Cost


Equity (Deficit)(In thousands)Balance at January 1, 2006


92,234


$
922


$
431,273


$
(303,099
)

$
(439
)

$
(3,610
)

$
(9,602
)

$
115,445Net loss














(77,783
)














(77,783
)Translation adjustment


















(1,232
)










(1,232
)Comprehensive loss






























(79,015
)Exercise of common stock options


239



3



1,026















7



1,036Issuance of common stock rights


11



























Forfeiture of restricted common stock


3







185















(185
)


Elimination of deferred compensation upon adoption of
    SFAS No. 123R










(3,610
)










3,610







Restricted stock compensation cost










2,603



















2,603Stock option compensation cost










3,519



















3,519Discount on convertible senior notes










9,119



















9,119Balance at December 31, 2006


92,487



925



444,115



(380,882
)


(1,671
)






(9,780
)


52,707Net loss














(99,592
)














(99,592
)Translation adjustment


















(958
)










(958
)Comprehensive loss






























(100,550
)Long-term incentive plan restricted stock


645



6



(6
)


















Employee stock purchase plan shares issued


82



1



327



















328Employee stock purchase plan discount










73



















73Exercise of common stock options


42



1



137



















138Issuance of common stock rights


13



























Restricted stock compensation cost










613



















613Stock option compensation cost










1,682



















1,682Discount on convertible senior notes










74,090



















74,090Balance at December 31, 2007


93,269



933



521,031



(480,474
)


(2,629
)






(9,780
)


29,081Net loss














(190,974
)














(190,974
)Translation adjustment


















1,483











1,483Comprehensive loss






























(189,491
)Exercise of common stock options


25







58



















58Issuance of common stock rights


11



























Stock option compensation cost










689



















689Employee stock purchase plan shares issued


215



2



417



















419Employee stock purchase plan discount










48



















48Issuance of restricted common stock


20



























Forfeiture of restricted common stock










3















(3
)


Restricted stock compensation cost










207



















207Balance at December 31, 2008


93,540


$
935


$
522,453


$
(671,448
)

$
(1,146
)

$



$
(9,783
)

$
(158,989
)    F-7




---



##### 



MIDWAY
    GAMES INC.
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Years Ended December 31,2008


2007


2006(In thousands)OPERATING ACTIVITIESNet loss

$
(190,974
)

$
(99,592
)

$
(77,783
)Adjustments to reconcile net loss to net cash used in operating
    activities:Depreciation and amortization of long lived assets


6,426



7,645



7,739Receivables provision


57,290



45,645



34,141Amortization of capitalized product development costs, including
    writedowns


79,656



66,228



55,324Deferred income taxes


1,435



(1,446
)


1,316Stock-based compensation


579



1,631



6,122Amortization of debt issuance costs


2,596



1,385



1,236Accretion of convertible senior notes discount


53,809



14,277



1,129(Gain) loss on disposal of property and equipment


(988
)


56



30Changes in operating assets and liabilities:Receivables


(78,157
)


(37,804
)


(53,587
)Proceeds from accounts receivable factoring facility


47,055







Payments on accounts receivable factoring facility


(31,348
)






Inventories


(2,742
)


(817
)


3,013Capitalized product development costs


(62,115
)


(78,076
)


(69,342
)Prepaid expenses and other current assets


(987
)


732



(1,535
)Accounts payable, accrued liabilities and deferred revenue


35,630



29,185



3,122Other assets and liabilities


9,331



(952
)


(3,827
)Net cash used in operating activities


(73,504
)


(51,903
)


(92,902
)INVESTING ACTIVITIESPurchases of property and equipment


(2,297
)


(5,696
)


(8,751
)Restricted cash


(1,100
)






Proceeds from the sale of property and equipment


5,100







75Net cash provided by (used in) investing activities


1,703



(5,696
)


(8,676
)FINANCING ACTIVITIESProceeds from issuance of convertible senior notes










75,000Proceeds from long-term debt






14,722



Payment of debt issuance costs


(515
)






(2,269
)Borrowings under Loan and Security Agreement  term
    loan


20,000







Borrowings under Loan and Security Agreement  revolver


13,452







Repayment of borrowings from Loan and Security
    Agreement  revolver


(4,500
)






Borrowings under Unsecured Loan Agreement  revolver


41,300







Repayment of borrowings from Unsecured Loan
    Agreement  revolver


(1,300
)






Borrowings under Subordinated Unsecured Loan
    Agreement  revolver


27,584







Repayment of borrowings under Subordinated Unsecured Loan
    Agreement  revolver


(7,605
)






Payment of borrowings from former credit facilities


(19,167
)


(2,650
)


(3,333
)Payment of software license financing arrangements






(1,156
)


(374
)Cash received from exercise of common stock options


59



138



6,318Net cash provided by financing activities


69,308



11,054



75,342Effect of exchange rate changes on cash


(2,010
)


647



1,282Decrease in cash and cash equivalents


(4,503
)


(45,898
)


(24,954
)Cash and cash equivalents at beginning of period


27,524



73,422



98,376Cash and cash equivalents at end of period

$
23,021


$
27,524


$
73,422Supplemental Disclosures of Cash Flow Information:Interest paid

$
13,765


$
10,855


$
8,519Income taxes paid

$
1,123


$
537


$
5    F-8




---



##### 



MIDWAY
    GAMES INC.
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER
    31, 2008
  NOTE 1:
    BUSINESS
    AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Nature of
    Business
  PlayStation 2 PlayStation 3 and
    PlayStation Portable, Xbox 360, Wii DS
  Consolidation
    Policy
    Segment
    Reporting
  Disclosures about Segments
    of an Enterprise and Related Information.
  Cash and
    Cash Equivalents
    Restricted
    Cash
    Receivable
    Allowances
     F-9




---



##### 



Inventories
  first-in,
  Capitalized
    Product Development Costs
  Accounting for the Costs of Computer
    Software to be Sold, Leased, or Otherwise Marketed product-by-product
    product-by-product
   F-10




---



##### 



Property
    and Equipment
    Long-Lived
    Assets
  other-than-temporary
  Goodwill
  Goodwill and Other Intangible
    Assets
  Intangible
    Assets
    Debt
    Issuance Costs
    Stock-Based
    Compensation
  Share-Based Payment
 F-11




---



##### 



Accounting
    for Stock-Based Compensation
    Revenue
    Recognition
  97-2, Software Revenue Recognition.
      Distribution
    Costs
    Advertising
    Expense
    Income
    Taxes
   F-12




---



##### 



Foreign
    Currencies
      Comprehensive
    Loss
  Reporting Comprehensive Income
  Loss per
    Common Share
    December 31,Type

2008


2007


2006Stock options


1,388



4,537



3,810Contingent shares






713



1,045Convertible senior notes


18,864



18,864



12,747Total


20,252



24,114



17,602       Registration
    Rights
   F-13




---



##### 




    $75,000,000 of convertible senior notes that are convertible
    into common stock at a current conversion rate of
    100 shares per $1,000 principal amount of the
    notes; and
    $75,000,000 of convertible senior notes that are convertible
    into common stock at a current conversion rate of
    151.5152 shares per $1,000 principal amount of the notes.    Concentration
    of Risk
      Years Ended December 31,2008


2007


2006Geographic areasNet revenues outside of the United States

$
84,477


$
70,802


$
48,860Major customersNet revenues from GameStop

$
32,586


$
23,348


$
24,175Net revenues from Wal-Mart

$
26,134


$
15,998


$
27,596       Mortal Kombat
    Warranties
    Fair
    Value of Financial Instruments
   F-14




---



##### 



Use of
    Estimates
    Recently
    Issued Accounting Pronouncements
  Fair Value Measurements
  SFAS No. 157-3, Determining the Fair Value of a Financial Asset When the
    Market for That Asset Is Not Active SFAS No. 157-3
  The
    Fair Value Option for Financial Assets and Financial Liabilities
  SFAS No. 142-3, Determination of the Useful Life of Intangible Assets SFAS No. 142-3 SFAS No. 142-3 SFAS No. 142-3 SFAS No. 142-3
 F-15




---



##### 



SFAS No. 142-3
  SOP 90-7-1, An Amendment of AICPA Statement of Position
    90-7 SOP 90-7-1
  NOTE 2:
    CHAPTER 11
    REORGANIZATION PROCEEDINGS  debtors-in-possession
         F-16




---



##### 



SOP 90-7-1 SOP 90-7-1 SOP 90-7-1
    NOTE 3:
    GOING
    CONCERN     F-17




---



##### 



NOTE 4:
    CAPITALIZED
    PRODUCT DEVELOPMENT COSTS    Years Ended December 31,2008


2007


2006Beginning balance

$
54,199


$
41,613


$
27,595Additions


62,479



78,814



69,342Amortization, including writedowns


(69,414
)


(66,228
)


(55,324
)Restructuring charges


(10,242
)






Ending balance

$
37,022


$
54,199


$
41,613     NOTE 5:
    PROPERTY
    AND EQUIPMENT    December 31,2008


2007Land, land improvements, buildings and building improvements

$



$
6,034Leasehold improvements


6,375



6,829Furniture, fixtures, equipment and software


47,992



46,789Construction-in-progress


180



71454,547



60,366Less accumulated depreciation and amortization


(45,035
)


(41,068
)Property and equipment, net

$
9,512


$
19,298     NOTE 6:
    OTHER
    ACCRUED LIABILITIES    December 31,2008


2007Product development advance

$
5,351


$
5,351Deposit on sale-leaseback property (Note 14)


2,425



Other taxes payable


2,413



3,044Convertible notes interest payable


1,582



1,598Other


6,909



4,197Total

$
18,680


$
14,190   NOTE 7:
    FACTORING
    AGREEMENT   F-18




---



##### 



NOTE 8:
    CREDIT
    FACILITIES  Wells
    Fargo Foothill Credit Facility
       F-19




---



##### 



NAI
    Credit Facilities
       F-20




---



##### 



F-21




---



##### 



NOTE 9:
    INCOME
    TAXES  Valuation
    Allowance
    Pretax
    Loss
    December 31,2008


2007


2006(In thousands)Domestic

$
(192,643
)

$
(105,227
)

$
(78,687
)Foreign


3,376



4,883



2,550Total pretax book loss

$
(189,267
)

$
(100,344
)

$
(76,137
)   Income
    Tax Provision (Benefit)
    Years Ended December 31,2008


2007


2006(In thousands)Current:Federal

$



$



$
State


2



1



Foreign


163



776



330Total current


165



777



330Deferred:Federal


(66,243
)


(36,191
)


(23,855
)State


(4,182
)


(2,285
)


(1,506
)Foreign


230



1,299



564Total deferred


(70,195
)


(37,177
)


(24,797
)Valuation allowance


71,737



35,648



26,113Total provision (benefit) for income taxes

$
1,707


$
(752
)

$
1,646  F-22




---



##### 



Years Ended December 31,2008


2007


2006(In thousands)Federal at statutory rate of 35%

$
(66,243
)

$
(35,121
)

$
(26,648
)State income taxes, net of federal benefit


(4,182
)


(2,218
)


(1,683
)Valuation allowance


71,737



35,648



26,113Other, net


395



939



3,864Total provision (benefit) for income taxes

$
1,707


$
(752
)

$
1,646   Income
    Taxes Payable (Refundable)
    December 31,2008


2007(In thousands)Federal

$



$
State


2



1Foreign


(310
)


609Income taxes payable (refundable)

$
(308
)

$
610   Deferred
    Income Taxes
      December 31,2008


2007(In thousands)Deferred tax assets resulting from:Tax loss carryforward

$
279,109


$
221,127Accrued liabilities not currently deductible


5,506



9,232Receivable allowance


9,653



10,337Tax over book depreciation


1,585



827Other


10,870



69Gross deferred tax assets


306,723



241,592Deferred tax liabilities resulting from:Goodwill


12,028



10,715Capitalized product development costs


13,776



20,168Discount on convertible senior notes


45,251



25,229Other


400



33Gross deferred tax liabilities


71,455



56,145Valuation allowance


(245,044
)


(193,329
)Net deferred tax liabilities

$
(9,776
)

$
(7,882
)  F-23




---



##### 



Years Ended December 31,2008


2007(In thousands)Deferred tax assets  current

$
1,164


$
1,260Deferred tax assets  non-current


1,088



1,573Total deferred tax assets


2,252



2,833Deferred tax liabilities  current






Deferred tax liabilities  non-current


(12,028
)


(10,715
)Total deferred tax liabilities


(12,028
)


(10,715
)Net deferred tax liabilities

$
(9,776
)

$
(7,882
)           NOTE 10:
    CONVERTIBLE
    SENIOR NOTES    September
    2005 Issuance
   F-24




---



##### 




    Our controlling stockholder and his affiliates become the
    beneficial owner, directly or indirectly, of 90% or more of the
    aggregate fair value of our outstanding capital stock. In this
    event, the conversion rate will increase by 4.4177 shares
    per $1,000 principal amount of the notes. This conversion rate
    increase is subject to future adjustment in accordance with the
    provisions of the indenture governing the 6.0% Notes.
    On April 30, 2007, or in some circumstances,
    September 30, 2007, if the daily volume weighted average
    price of our common stock for the period that is 20 consecutive
    trading days prior to April 30, 2007, or in some
    circumstances, September 30, 2007, is less than $16.14, as
    adjusted for capital changes ($10.00 Reset Feature).
    In this event, the conversion rate will increase at varying
    amounts. However, after adjustment, the conversion rate cannot
    exceed 100 shares per $1,000 principal amount of the
    6.0% Notes.
    We effect certain business combinations, asset sales or changes
    in ownership where the consideration paid to the common
    stockholders includes securities (or other property) that are
    neither traded on a U.S. national securities exchange nor
    quoted on the Nasdaq National Market nor scheduled to be so
    traded or quoted immediately after such transaction. In these
    events, the conversion rate will increase at varying amounts
    with a maximum increase of 5.63 shares per $1,000 principal
    amount of the 6.0% Notes.
    Issuance of additional rights to holders of our common stock,
    such as stock splits, declaration of dividends and certain other
    distributions and capital changes.         F-25




---



##### 



Earnings per Share
    May 2006
    Issuance
      
    Our controlling stockholder and his affiliates become the
    beneficial owner, directly or indirectly, of 90% or more of the
    aggregate fair market value, as defined, of our outstanding
    capital stock. In this event, the conversion rate will increase
    by 7.2495 shares per $1,000 principal amount of the notes.
    This conversion rate increase is subject to future adjustment in
    accordance with the provisions of the indenture governing the
    7.125% Notes.
    On any date prior to May 31, 2008, if (1) the
    arithmetic average of the daily volume-weighted average price of
    our common stock for any 20 trading days within a period of 30
    consecutive trading days ending on such date, is less than
    $8.00, as may be adjusted for capital changes, and (2) 110%
    of the closing sale price is less than or equal to $8.80, as may
    be adjusted, then the conversion rate will increase on that date
    such that the conversion price would be $8.80 per share of
    common stock ($8.80 Reset Feature).
    On any date prior to May 31, 2008, if (1) the
    arithmetic average of the daily volume-weighted average price of
    our common stock for any 20 trading days within a period of 30
    consecutive trading days ending on such date, is less than
    $6.00, as may be adjusted for capital changes, and (2) 110%
    of the closing sale price is less than or equal to $6.60, as may
    be adjusted, then the conversion rate will increase on that date
    such that the conversion price would be $6.60 per share of
    common stock ($6.60 Reset Feature).  
    On May 31, 2008 or May 31, 2009, if 110% of the
    arithmetic average of the daily volume-weighted average price of
    our common stock for any 20 trading days within a period of 30
    consecutive trading days ending on such dates is less than the
    conversion price in effect at that time, then the conversion
    rate will be increased so that the conversion price would be
    110% of the daily volume-weighted average price calculated at
    these respective dates. The conversion rate will not be adjusted
    on these dates if 110% of the daily volume-weighted average
    price for such 20 trading days within such period of 30
    consecutive trading days ending on such dates is equal to or
    greater than the conversion price in effect at that time. In no
    event shall the conversion rate be adjusted such that the
    conversion price would be less than $6.60 per share, as may be
    adjusted for capital changes.  
    We effect certain business combinations, asset sales or changes
    in ownership where the consideration paid to the common
    stockholders includes securities (or other property) that are
    neither traded on a U.S. national securities exchange nor
    quoted on the Nasdaq National Market nor scheduled to be so
    traded or quoted immediately after such transaction. In these
    events, the conversion rate will increase at varying amounts
    with a maximum increase of 9.23 shares per $1,000 principal
    amount of the notes.
    Issuance of additional shares of common stock, convertible
    securities, rights to holders of our common stock, such as stock
    splits, declaration of dividends and certain other distributions
    and capital changes. F-26




---



##### 



Earnings per Shar
    NOTE 11:
    PREFERRED
    STOCK AND WARRANTS   F-27




---



##### 



NOTE 12:
    COMMON
    STOCK  Common
    Stock
    Number ofDescription

SharesCommon stock option and long-term incentive plans


3,190Employee stock purchase plan


2,703Convertible senior notes


20,854Total


26,747   Savings
    Plan
    Employee
    Stock Purchase Plan
    Rights
    Agreement
   F-28




---



##### 



Stock-Based
    Awards
      NOTE 13:
    STOCK-BASED
    COMPENSATION  Stock-Based
    Compensation Under SFAS No. 123R
      Determining
    Fair Value of Stock Options Under
    SFAS No. 123R
  Valuation Method.
  Expected Term.
  Expected Volatility.
 F-29




---



##### 



Risk-Free Interest Rate.
  Expected Dividend Yield.
  Expected Forfeitures.
    Years Ended December 31,2008


2007


2006Dividend yield


0.0
%


0.0
%


0.0
%Expected stock price volatility


0.60



0.58



0.70Risk-free interest rate


3.17
%


4.06
%


4.54
%Expected lives


5 years



5 years



5 years   Stock
    Option Activity
    Weighted


Weighted


AggregateAverage


Average


IntrinsicOptions


Exercise


Remaining


Value(in thousands)


Price


Contractual Life


(in thousands)Outstanding at January 1, 2006


4,877



9.65Granted


104



8.88Exercised


(240
)


4.31






$
2,826Expired


(913
)


19.84Forfeited


(18
)


3.52Outstanding at December 31, 2006


3,810



7.56



5.6 years


$
6,961Granted


968



5.85Exercised


(42
)


3.23






$
126Expired


(77
)


13.73Forfeited


(122
)


8.10Outstanding at December 31, 2007


4,537


$
7.12



5.5 years


$
138Granted


60



2.60Exercised


(25
)


2.35






$
7Expired


(2,907
)


5.28Forfeited


(277
)


5.87Outstanding at December 31, 2008


1,388


$
6.03



5.7 years


$
Exercisable at December 31, 2008


854


$
6.29



4.4 years


$
   Years Ended December 31,2008


2007


2006Weighted average grant date fair value of options granted

$
1.39


$
3.09


$
5.37  F-30




---



##### 



WeightedAverageRemainingWeighted Average


ContractualShares Covered by Options


Exercise Price


LifeExercise Prices

Outstanding


Exercisable


Outstanding


Exercisable


Outstanding$2.25  $3.15


305



248


$
2.42


$
2.43



4.73.60  6.55


756



307



5.76



5.63



6.66.61  9.25


191



168



8.39



8.43



6.09.99  13.04


72



67



10.91



10.87



3.113.70  16.57


64



64



13.97



13.97



1.61,388



854



6.03



6.29



5.7       Restricted
    Stock
  and/or
  Restricted
    stock  non-performance-based awards
   F-31




---



##### 



WeightedAverageGrantShares


PriceOutstanding at January 1, 2006


430


$
9.89Granted






Vested


(303
)


8.86Forfeited


(20
)


9.41Outstanding at December 31, 2006


107



11.47Granted






Vested


(73
)


10.31Forfeited






Outstanding at December 31, 2007


34



13.92Granted






Vested


(34
)


13.92Forfeited






Outstanding at December 31, 2008






     Restricted
    stock  performance-based awards
  Form 10-K
  NOTE 14:
    SALE AND
    LEASEBACK AGREEMENTS     F-32




---



##### 



NOTE 15:
    RESTRUCTURING
    AND OTHER CHARGES (BENEFITS)         F-33




---



##### 



Impairment of


Severance


Lease and


ImpairmentCapitalized


and


Long-Term


of Fixed andProduct


Accrued


Commitments


IntangibleDevelopment


Vacation


and Other


Assets andCosts


Costs


Costs


Goodwill


TotalBalances at January 1, 2006

$



$



$
1,286


$



$
1,286Provision (benefits)(a)










(130
)






(130
)Usage/payouts










(245
)






(245
)Balances at December 31, 2006










911







911Provision (benefits)(b)










(783
)






(783
)Other










(128
)






(128
)Balances at December 31, 2007


















Provision


10,242



3,859



198







14,299Usage/payouts(c)


(10,242
)


(1,297
)


(198
)






(11,737
)Balances at December 31, 2008

$



$
2,562


$



$



$
2,562     (a)
    
    During 2006, we recorded reversals of previously accrued charges
    totaling $251,000 related to changes in estimates of accrued
    facility lease expense and sublease income.(b)
    
    During 2007, the benefit recorded relates to a change in the
    estimated amount of previously awarded grants that may be
    required to be refunded by our subsidiary to the Commonwealth of
    Australia.(c)
    
    During 2008, we paid severance totaling $1,297,000 to employees
    affected by restructuring activities.    NOTE 16:
    COMMITMENTS    2009

$
3,3832010


2,7912011


2,5282012


2,3992013


1,549Thereafter


172$
12,822    F-34




---



##### 



2009

$
8832010


2011


2012


502013


Thereafter


$
933   NOTE 17:
    LEGAL
    PROCEEDINGS    No. 09-10465(KG). debtors-in-possession,
   F-35




---



##### 



NOTE 18:
    RELATED
    PARTY TRANSACTIONS  Majority
    Shareholder and Directors
         F-36




---



##### 



agreed-upon L.A. RUSH, L.A. RUSH
        Consolidated
    German Subsidiary Management
    NOTE 19:
    SUBSEQUENT
    EVENTS   F-37




---



##### 



Wheelman Wheelman Wheelman
  debtors-in-possession
      ®
 F-38




---



##### 



MIDWAY
    GAMES INC.
  SCHEDULE II 
    VALUATION AND QUALIFYING ACCOUNTS
  Column CColumn A

Column B


Additions


Column D


Column EBalance at


Charged to


Charged to





Balance atBeginning of


Costs and


Other





End ofPeriod

Description

Period


Expenses


Accounts


Deductions


PeriodYear Ended December 31, 2008

Allowance for doubtful accounts

$
350,000


$
4,585,000


$



$
309,000


$
4,626,000Allowance for price protection, returns and discounts


32,160,000



51,987,000







60,330,000



23,817,000Deferred tax asset valuation allowance


193,329,000



71,737,000







20,022,000



245,044,000Year Ended December 31, 2007

Allowance for doubtful accounts

$
1,315,000


$
320,000


$



$
1,285,000


$
350,000Allowance for price protection, returns and discounts


18,093,000



45,989,000







31,922,000



32,160,000Deferred tax asset valuation allowance


185,546,000



35,648,000







27,865,000



193,329,000Year Ended December 31, 2006

Allowance for doubtful accounts

$
1,263,000


$
241,000


$



$
189,000


$
1,315,000Allowance for price protection, returns and discounts


14,867,000



33,900,000







30,674,000



18,093,000Deferred tax asset valuation allowance


160,622,000



26,113,000







1,189,000



185,546,000  F-39




---



##### 



SIGNATURES      By:
    /s/  MATTHEW
    V. BOOTY       Name

Title

Date/s/  MATTHEW
    V. BOOTYMatthew
    V. Booty

Chairman, President and Chief Executive Officer
    (Principal Executive Officer)

April 6, 2009/s/  RYAN
    G. ODESKYRyan
    G. ODesky

Chief Financial Officer, Senior Vice President 
    Finance and Treasurer (Principal Financial Officer and Principal
    Accounting Officer)

April 6, 2009/s/  WILLIAM
    C. BARTHOLOMAYWilliam
    C. Bartholomay

Director

April 6, 2009/s/  JOSEPH
    A. CALIFANO, JR.Joseph
    A. Califano, Jr.

Director

April 6, 2009/s/  ROBERT
    N. WAXMANRobert
    N. Waxman

Director

April 6, 2009




---



##### 



EXHIBIT INDEX
  ExhibitNo.

Description3
.1

Amended and Restated Certificate of Incorporation of the
    Registrant dated October 25, 1996, incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-1/A,
    as amended, File
    No. 333-11919,
    filed on October 18, 1996 and effective October 29,
    1996 (the
    S-1
    Registration Statement).3
.2

Certificate of Amendment to the Amended and Restated Certificate
    of Incorporation of the Registrant dated February 25, 1998,
    incorporated herein by reference to the Registrants
    Registration Statement on
    Form 8-A/A,
    Amendment No. 1, filed on April 20, 1998.3
.3

Certificate of Amendment to the Amended and Restated Certificate
    of Incorporation of the Registrant dated August 5, 2003,
    incorporated herein by reference to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2003.3
.4

Certificate of Amendment of the Amended and Restated Certificate
    of Incorporation of the Registrant dated February 17, 2004,
    incorporated herein by reference to the Registrants
    Registration Statement on
    Form S-3,
    File
    No. 333-113077,
    initially filed on February 25, 2004.3
.5

Amended and Restated By-laws of the Registrant, incorporated
    herein by reference to the Registrants Registration
    Statement on
    Form S-3,
    File
    No. 333-116334,
    initially filed on June 10, 2004 (the 6/10/04
    S-3).3
.6

Composite Amended and Restated By-laws of the Registrant dated
    June 13, 2007, incorporated herein by reference to the
    Registrants Current Report on
    Form 8-K
    filed on May 3, 2007.4
.1

Indenture, dated as of September 19, 2005, between the
    Registrant and Wells Fargo Bank, National Association,
    incorporated herein by reference to the Registrants
    current report on
    Form 8-K
    filed on September 19, 2005 (the 9/19/2005
    8-K).4
.2

Registration Rights Agreement, dated as of September 19,
    2005 between the Registrant and Banc of America Securities, LLC,
    as representative of the Initial Purchasers, incorporated herein
    by reference to the 9/19/2005
    8-K.4
.3

Indenture, dated as of May 30, 2006, between the Registrant
    and Wells Fargo Bank, National Association, incorporated herein
    by reference to the Registrants Current Report on
    Form 8-K
    filed on May 30, 2006 (the 5/30/06
    8-K).4
.4

Registration Rights Agreement, dated as of May 30, 2006,
    between the Registrant and Banc of America Securities, LLC,
    incorporated herein by reference to the 5/30/06
    8-K.4
.5

Notice of Adjustment, dated July 13, 2006, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K
    filed on July 14, 2006.4
.6

Notice of Adjustment, dated April 30, 2007, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K
    filed on April 30, 2007.4
.7

Notice of Adjustment, dated August 22, 2007, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K
    filed on August 27, 2007.10
.1*

1996 Stock Option Plan, incorporated herein by reference to the
    Registrants Registration statement on
    Form S-1/A,
    as amended, File
    No. 333-11919,
    filed on October 25, 1996 and effective October 29,
    1996.10
.2*

1998 Non-Qualified Stock Option Plan, incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-8,
    filed on June 24, 1998 (File
    No. 333-57583).10
.3*

1998 Stock Incentive Plan, incorporated herein by reference to
    the Registrants Registration Statement on
    Form S-8,
    filed on December 4, 1998 (File
    No. 333-68373).10
.4*

1999 Stock Option Plan, incorporated herein by reference to the
    Registrants Registration Statement on
    Form S-8,
    filed on March 5, 1999 (File
    No. 333-73451).10
.5*

2000 Non-Qualified Stock Option Plan, incorporated herein by
    reference to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended June 30, 2000, filed on
    September 26, 2000.10
.6*

Amendment to 1998 Stock Incentive Plan, incorporated herein by
    reference to the Registrants Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended September 30, 2001, filed on
    November 14, 2001.10
.7*

2002 Stock Option Plan, incorporated herein by reference to the
    Registrants definitive proxy statement filed on
    December 5, 2001.




---



##### 



ExhibitNo.

Description10
.8*

Letter Agreement dated as of March 21, 2001, between the
    Registrant and Thomas E. Powell regarding Mr. Powells
    employment by the Registrant, incorporated herein by reference
    to the Registrants Transition Report on
    Form 10-KT-405
    for the six-month transition period ended December 31,
    2001, filed on March 28, 2002.10
.9*

2002 Non-Qualified Stock Option Plan, incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-8,
    filed on August 26, 2002 (File
    No. 333-98745).10
.10*

Letter Agreement dated as of February 10, 2003 between the
    Registrant and Thomas E. Powell regarding Mr. Powells
    employment by the Registrant, incorporated herein by reference
    to the Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2002 filed with the
    SEC on March 28, 2003.10
.11*

Executive Employment Agreement made as of May 6, 2003,
    between the Registrant and David Zucker, incorporated herein by
    reference to the Registrants Current Report on
    Form 8-K
    filed on May 7, 2003 (the 5/7/03
    8-K).10
.12*

Stock Option Agreement made as of May 6, 2003, between the
    Registrant and David Zucker, incorporated herein by reference to
    the 5/7/03
    8-K.10
.13*

Stock Option Agreement under 2002 Stock Option Plan made as of
    May 6, 2003, between the Registrant and David Zucker,
    incorporated herein by reference to the 5/7/03
    8-K.10
.14*

Restricted Stock Agreement entered into as of May 6, 2003,
    between the Registrant and David Zucker, incorporated herein by
    reference to the 5/7/03
    8-K.10
.15

PlayStation®

    2 CD-ROM/DVD-ROM Licensed Publisher Agreement dated
    April 1, 2000 between Sony Computer Entertainment America
    Inc. and Midway Home Entertainment Inc., incorporated herein by
    reference to the Registrants Registration Statement on
    Form S-3/A,
    filed on August 18, 2003 (the August 2003
    S-3/A).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 406 under the Securities Act of 1933, as amended.)10
.16

PlayStation®

    2 Licensed Publisher Agreement dated November 14, 2000
    between Sony Computer Entertainment Europe Limited and Midway
    Games Limited, incorporated herein by reference to the August
    2003 S-3/A.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 406 under the Securities Act of 1933, as amended.).10
.17*

Waiver, dated as of April 5, 2004, by David F. Zucker,
    incorporated herein by reference to the Registrants
    Current Report on
    Form 8-K
    filed on April 13, 2004.10
.18*

Amendment to Stock Option Plans of the Registrant, incorporated
    herein by reference to the 6/10/04
    S-3.10
.19

Letter Agreement entered into as of September 20, 2004
    amending the
    PlayStation®2

    CD-ROM/DVD-ROM Licensed Publisher Agreement effective as of
    April 1, 2000 between Sony Computer Entertainment America
    Inc. and Midway Home Entertainment Inc., incorporated herein by
    reference to the Registrants Quarterly Report on
    Form 10-Q
    for the fiscal quarter ended on September 30, 2004, filed
    on November 8, 2004 (the 9/30/2004
    10-Q).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.20*

First Amendment to Restricted Stock Agreement made as of
    October 18, 2004, between the Registrant and David F.
    Zucker, incorporated herein by reference to the 9/30/2004
    10-Q.10
.21*

2000 Stock Option/Stock Issuance Plan for Midway
    Studios  Austin Inc. and Form of Stock Option
    Agreement, incorporated herein by reference to the
    Registrants Registration Statement on
    Form S-8,
    File
    No. 333-120347,
    filed on November 10, 2004.10
.22*

2004 Form of Indemnification Agreement authorized to be entered
    into between the Registrant and officers and directors of the
    Registrant, incorporated herein by reference to the
    Registrants Annual Report on
    Form 10-K
    for the fiscal year ended December 31, 2004, filed on
    March 14, 2005 (the 2004
    10-K).10
.23*

Form of Stock Option Agreement For Directors used currently by
    the Registrant for directors under its stock option plans,
    incorporated herein by reference to the 2004
    10-K.10
.24*

Form of Stock Option Agreement For Employees used currently by
    the Registrant for employees under its stock option plans,
    incorporated herein by reference to the 2004
    10-K.




---



##### 



ExhibitNo.

Description10
.25*

Amended and Restated Midway Incentive Plan, incorporated herein
    by reference to the 2004
    10-K.10
.26*

2005 Long-Term Incentive Plan, incorporated herein by reference
    to the Registrants definitive proxy statement filed on
    April 29, 2005 (File
    No. 001-12367).10
.27*

Form of Stock Option Agreement used currently by the Registrant
    for employees under its 2005 Long-Term Incentive Plan,
    incorporated herein by reference to the 6/30/2005
    10-Q.10
.28*

Form of Restricted Stock Agreement used currently by the
    Registrant for management under its 2005 Long-Term Incentive
    Plan, incorporated herein by reference to the Registrants
    Current Report on
    Form 8-K
    filed on October 7, 2005.10
.29*

Form of Non-Employee Director Stock Option Agreement under the
    2005 Long-Term Incentive Plan incorporated herein by reference
    to the Registrants Current Report on
    Form 8-K
    filed on September 12, 2006.10
.30

Xbox 360 Publisher License Agreement entered into as of
    October 25, 2006 by and between Microsoft Licensing, GP and
    Midway Home Entertainment Inc., incorporated herein by reference
    to the Registrants Annual Report on
    Form 10-K
    for the year ended December 31, 2006, filed on
    March 12, 2007. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.31

Amended and Restated Loan and Security Agreement by and among
    the Registrant, specified subsidiaries of the Registrant, the
    lenders thereto, and Wells Fargo Foothill, Inc., dated as of
    June 29, 2007, incorporated herein by reference to the
    Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007.10
.32

First Amendment to Amended and Restated Loan and Security
    Agreement by and among the Registrant, specified subsidiaries of
    the Registrant, the lenders thereto and Wells Fargo Foothill,
    Inc., dated as of July 31, 2007, incorporated herein by
    reference to the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007.10
.33

Unreal®

    Engine 3 License Agreement by and between Epic Games, Inc.
    (Epic) and Midway Home Entertainment Inc.
    (MHEI), dated as of January 14, 2005,
    incorporated herein by reference to the Registrants
    Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.34

Amendment No. 1 to
    Unreal®

    Engine 3 License Agreement by and between Epic and MHEI, dated
    as of December 5, 2005 incorporated herein by reference to
    the Registrants Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2007, filed on
    August 2, 2007. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.35*

Second Form of Restricted Stock Agreement used by the Registrant
    for management under its 2005 Long-Term Incentive Plan,
    incorporated herein by reference to Registrants Quarterly
    Report on
    Form 10-Q
    for the quarter ended September 30, 2007, filed on
    November 1, 2007.10
.36

Waiver and Second Amendment to Amended and Restated Loan and
    Security Agreement by and among the Registrant, specified
    subsidiaries of the Registrant, the lenders thereto and Wells
    Fargo Foothill, Inc., dated as of January 2, 2008
    incorporated herein by reference to the Registrants Annual
    Report on
    Form 10-K
    for the year ended December 31, 2007, filed on
    March 14, 2008 (the 2007
    10-K).10
.37*

Confidential Settlement Agreement and General Release by and
    between the Registrant and Steven M. Allison dated
    January 24, 2008 incorporated herein by reference to the
    2007 10-K.10
.38

Amendment to the Xbox 360 Publisher License Agreement effective
    as of October 12, 2007 between Microsoft Licensing, GP and
    Midway Home Entertainment Inc. incorporated herein by reference
    to the 2007
    10-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)




---



##### 



ExhibitNo.

Description10
.39

Confidential License Agreement for the Wii Console between
    Nintendo of America Inc. and Midway Home Entertainment Inc.
    effective November 19, 2006 incorporated herein by
    reference to the Registrants Current Report on
    Form 10-K/A,
    Amendment No. 2 filed on October 27, 2008 (the
    2007
    10-K/A).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.40

License Agreement for the Nintendo DS System (EEA, Australia and
    New Zealand) dated June 18, 2006 between Nintendo Co., Ltd.
    and Midway Games Limited incorporated herein by reference to the
    2007 10-K/A.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.41*

Sales Incentive Bonus Plan for Martin Spiess dated
    April 20, 2007 incorporated herein by reference to the 2007
    10-K/A.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.42

Loan and Security Agreement by and among the Registrant,
    specified subsidiaries of the Registrant, and National
    Amusements, Inc., dated as of February 29, 2008
    incorporated herein by reference to the 2007
    10-K.10
.43

Continuing Guaranty dated as of February 29, 2008, between
    the Registrant and specified subsidiaries in favor of National
    Amusements, Inc. incorporated herein by reference to the 2007
    10-K.10
.44

Intercompany Subordination Agreement dated as of
    February 29, 2008 among the Registrant, specified
    subsidiaries of the Registrant and National Amusements, Inc.
    incorporated herein by reference to the 2007
    10-K.10
.45

Unsecured Loan Agreement dated as of February 29, 2008, by
    and between the Registrant and National Amusements, Inc.
    incorporated herein by reference to the 2007
    10-K.10
.46

Unsecured Subordinated Loan Agreement dated as of February 29
    2008, by and between the Registrant and National Amusements Inc.
    incorporated herein by reference to the 2007
    10-K.10
.47*

Letter Agreement dated as of March 19, 2008 between Midway
    Games Inc. and Matthew V. Booty, incorporated herein by
    reference to the Registrants Current Report on
    Form 8-K,
    filed on March 20, 2008.10
.48*

Memorandum to Matthew V. Booty Regarding Performance-Based
    Bonuses for Interim CEO and President dated April 8, 2008,
    incorporated herein by reference to the Registrants
    Current Report on
    Form 8-K/A,
    Amendment No. 2, filed on October 21, 2008. Portions
    of this exhibit have been omitted pursuant to a request for
    confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.10
.49*

Midway Games Inc. Memorandum to Ryan ODesky Regarding
    Terms of Employment dated April 8, 2008, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K,
    filed on April 11, 2008 (the 4/11/08
    8-K).10
.50*

Midway Games Limited Memorandum to Martin Spiess Regarding Terms
    of Employment dated April 8, 2008, incorporated herein by
    reference to the 4/11/08
    8-K.10
.51*

Midway Games Limited Memorandum to Martin Spiess Regarding Sales
    Incentive Bonus Plan dated April 8, 2008, incorporated
    herein by reference to the Registrants Current Report on
    Form 8-K/A,
    Amendment No. 1, filed on October 21, 2008. (Portions
    of this exhibit have been omitted pursuant to a request for
    confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.52

Factoring Agreement by and among National Amusements, Inc.,
    Midway Home Entertainment Inc., and Midway Amusement Games, LLC
    dated September 15, 2008 incorporated herein by reference
    to the Registrants Current Report on
    Form 8-K
    filed on September 18, 2008 (the 9/18/08
    8-K).
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)




---



##### 



ExhibitNo.

Description10
.53

Amendment No. 2 to Loan and Security Agreement by and among
    the Registrant, specified subsidiaries of the Registrant, and
    National Amusements, Inc., dated as of September 15, 2008
    incorporated herein by reference to the 9/18/08
    8-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.54

Amendment No. 2 to Unsecured Loan Agreement, by and between
    the Registrant and National Amusements Inc., dated as of
    September 15, 2008 incorporated herein by reference to the
    9/18/08 8-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.55

Amendment No. 2 to Unsecured Subordinated Loan Agreement by
    and between the Registrant and National Amusements Inc., dated
    as of September 15, 2008 incorporated herein by reference
    to the 9/18/08
    8-K.
    (Portions of this exhibit have been omitted pursuant to a
    request for confidential treatment in accordance with
    Rule 24b-2
    under the Securities Exchange Act of 1934, as amended.)10
.56

Global PlayStation 3 Format Licensed Publisher Agreement
    effective as of September 26, 2008 by and between Sony
    Computer Entertainment America Inc. and Midway Home
    Entertainment, Inc. (Portions of this exhibit have been omitted
    pursuant to a request for confidential treatment in accordance
    with Rule
    24b-2 under
    the Securities Exchange Act of 1934, as amended.)10
.57

Amendment No. 1 to Loan and Security Agreement by and among
    the Registrant, specified subsidiaries of the Registrant, and
    National Amusements, Inc., dated as of August 19, 2008.10
.58

Amendment No. 1 to Unsecured Loan Agreement, by and between
    the Registrant and National Amusements Inc., dated as of
    August 19, 2008.10
.59

Amendment No. 1 to Unsecured Subordinated Loan Agreement by
    and between the Registrant and National Amusements Inc., dated
    as of August 19, 2008.21


Subsidiaries of the Registrant.23


Consent of Ernst & Young LLP.31


Certifications of Chief Executive Officer and Chief Financial
    Officer Pursuant to
    Rule 13a-14(a)
    under the Securities Exchange Act of 1934, as amended, as
    Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
    of 2002.32


Certifications of Chief Executive Officer and Chief Financial
    Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
    Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*


Indicates a management contract or compensatory plan or
    arrangement.