MIDWAY GAMES INC. Restricted Stock Award

EXHIBIT 10.1

MIDWAY GAMES INC.

Restricted Stock Award

     Midway Games Inc., a Delaware corporation (the “Company”) hereby grants to the “Participant” named below (also referred to herein as “you”) the number of shares of its common stock, par value $.01 per share (“Restricted Stock”), set forth below, pursuant to the attached Terms and Conditions of Restricted Stock Award and the Company’s 2005 Long-Term Incentive Plan (the “Plan”).

Name of Participant:__________________

Award Date: ______________ ___, 200__

Participant’s Social Security Number: _________________________

Number of Shares of Restricted Stock Covered by the Award: _________________________

MIDWAY GAMES INC.
Terms and Conditions of Restricted Stock Award
Under the 2005 Long-Term Incentive Plan
(the “Plan”)

Date of Award:                                          

Definitions. Capitalized terms used herein and on the cover sheet and not otherwise defined herein have the meanings ascribed to them in the Plan.

Restricted Stock/Nontransferability. This Award of Restricted Stock is for the number of shares set forth on the cover sheet attached hereto and is subject to the terms and conditions described below and the terms and conditions set forth in the Plan. Until the “Release Date” shown on the cover sheet, except as described below, your Restricted Stock may not be transferred, assigned, pledged or hypothecated, whether by operation of law or otherwise, nor may the Restricted Stock be made subject to execution, attachment or similar process (the “Restrictions”).

Issuance; Lapsing of Restrictions or Forfeiture. The Company will issue your Restricted Stock in your name as of the Award Date. Your Restricted Stock shall be restricted as to transfer until, and some or all of your Restricted Stock may be forfeited on, the Release Date based on the operating income of the Corporation for the fiscal year ending                     , as set forth in the Company’s audited consolidated financial statements for such year as filed with the Securities and Exchange Commission, as follows:

	•		if such operating income is less than $                    , then      % of your Restricted Stock shall be forfeited;
	•		if such operating income is at least $                     but less than $                    , then the Restrictions on                      of your Restricted Stock shall lapse and                      of your Restricted Stock shall be forfeited;
	•		if such operating income is at least $                    , then the Restrictions on      % of your Restricted Stock shall lapse.

Notwithstanding the foregoing, all Restricted Stock shall be forfeited (a) if the Company ceases to be subject to the reporting obligations under the Securities Exchange Act of 1934 (the “Exchange Act”); (b) upon a Change in Control, as defined below, and (c) upon the termination of your employment and/or service with the Company as provided in Section 6(d)(ii) of the Plan.

Forfeited amounts set forth above shall be rounded to the nearest whole number. If any of your Restricted Stock is forfeited in accordance with the foregoing provisions or as otherwise provided for in the Plan, such Restricted Stock shall be deemed no longer outstanding, and you shall return the certificate representing such Restricted Stock.

A “Change in Control” means (a) the acquisition by any person or group, other than Permitted Holders, of substantially all the assets of the Company or more than 50% of the capital stock having the right to vote for the election of the members of the Company’s Board of Directors or (b) the consummation of a business combination involving the Company in which the holders of

a majority of the Company’s outstanding stock immediately prior to the consummation of the business combination and any Permitted Holders cease to hold a majority of the outstanding capital stock having the right to vote for the election of the members of the Board of Directors or equivalent governing body of the surviving or resulting entity. For purposes of this definition, the following are “Permitted Holders”: Sumner M. Redstone, members of his family, and National Amusements, Inc. and any entities owned or controlled, directly or indirectly, by them excluding, however, any entities whose equity securities are registered under the Exchange Act.

Section 83(b) Election. Under Section 83 of the Internal Revenue Code of 1986, as amended (the “Code”), the difference between the purchase price, if any, paid for the Restricted Stock and their fair market value on the date the Restrictions applicable to such shares lapse will be reportable as ordinary income at that time. You may elect to be taxed at the time the shares are acquired rather than when such shares cease to be subject to such Restrictions by filing an election under Section 83(b) of the Code with the Internal Revenue Service within thirty (30) days after the Award Date. You will have to make a tax payment to the extent the purchase price is less than the fair market value of the shares on the Award Date. No tax payment will have to be made to the extent the purchase price is at least equal to the fair market value of the Restricted Stock on the Award Date. The form for making this election is attached as Exhibit A hereto. If you choose not to make this filing within the thirty (30) day period, you will recognize ordinary income as the Restrictions lapse.

Shareholder Rights. You have the right to vote your Restricted Stock and to receive any dividends declared or paid on such Restricted Stock. Any distributions you receive as a result of any stock split, stock dividend, combination of shares or other similar transaction shall be deemed to be a part of your Restricted Stock and subject to the same conditions and Restrictions applicable thereto.

Compliance with Law. The issuance of your Restricted Stock shall be subject to compliance with the Securities Act of 1933, as amended (the “Act”), and all applicable laws and rules, including the rules and policies of the New York Stock Exchange.

Legend. All certificates representing your Restricted Stock and shares issued in respect thereof shall, where applicable, have endorsed thereon the following legend:

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER, OR HIS OR HER PREDECESSOR IN INTEREST. A COPY OF SUCH AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF THE COMPANY AND WILL BE FURNISHED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY BY THE HOLDER OF RECORD OF THE SHARES REPRESENTED BY THIS CERTIFICATE.”

This Award has been made in accordance with, and is subject to and conditional upon all of the terms and conditions of the Plan which are incorporated by reference in this Restricted Stock Award as if fully set forth herein.

Governing Law. This Award shall be governed by and construed and interpreted in accordance with the laws of the State of Delaware, without giving effect to any conflicts of law rule or principle that might require the application of the laws of another jurisdiction.

EXHIBIT A

ELECTION UNDER SECTION 83(b) OF
THE INTERNAL REVENUE CODE

      The undersigned hereby makes an election pursuant to Section 83(b) of the Internal Revenue Code with respect to the property described below and supplies the following information in accordance with the regulations promulgated thereunder:

1.

The name, address and social security number of the undersigned:

		Name:
		Address:

		Social Security No.

2.

Description of property with respect to which the election is being made:

                     shares of common stock, par value $.01 per share, Midway Games, Inc., a Delaware corporation, (the “Company”).

	3.		The date on which the property was transferred is                           , 200 .
	4.		The taxable year to which this election relates is calendar year 200 .
	5.		Nature of restrictions to which the property is subject:

   The shares of stock are subject to the provisions of a Restricted Stock Award between the undersigned and the Company. The shares of stock are subject to forfeiture under the terms of the Agreement.

	6.		The fair market value of the property at the time of transfer (determined without regard to any lapse restriction) was $
per share, for a total of $                    .

	7.		The amount paid by taxpayer for the property was $___.
	8.		A copy of this statement has been furnished to the Company.

Dated:                     , 200 

		Taxpayer’s Signature
		Taxpayer’s Printed Name

PROCEDURES FOR MAKING ELECTION
UNDER INTERNAL REVENUE CODE SECTION 83(b)

     The following procedures must be followed with respect to the attached form for making an election under Internal Revenue Code section 83(b) in order for the election to be effective:

          1.        You must file one copy of the completed election form with the IRS Service Center where you file your federal income tax returns within 30 days after the Award Date of your Stock.

          2.        At the same time you file the election form with the IRS, you must also give a copy of the election form to the Secretary of the Company.

          3.        You must file another copy of the election form with your federal income tax return (generally, Form 1040) for the taxable year in which the stock is transferred to you.