Multimedia Games reports update

AUSTIN, Texas -- (PRESS RELEASE) -- Multimedia Games, Inc. (Nasdaq: MGAM) ("Multimedia") today reported its total player terminal installed base and product mix as of February 29, 2008, and provided updates on the markets served by Multimedia. The Company had units installed at 15 locations in Mexico as of February 29, 2008 and at 14 locations as of January 31, 2008. The new location opened on February 19, 2008 in Monterrey and the units at this location have generated hold per day well above the levels Multimedia's games are achieving with other placements in the Mexico market.

Multimedia had 313 Reel Time Bingo® units installed at the facilities of two California tribes at February 29, 2008 and 534 units at January 31, 2008. In February, California voters approved two referenda that allow four tribes to increase the number of Class III games they operate. As such, the Company expects the tribes to remove nearly all of its remaining Reel Time Bingo units in March 2008. The appropriate gaming laboratory for the California tribal gaming market is reviewing Multimedia's Class III platform and the Company expects this platform and its initial game offering to be approved in late spring 2008 with initial placements occurring in early summer 2008.

In Washington State, as previously disclosed, in FY 2008 to date Multimedia Games has entered into agreements for the sale of a total of 1,170 player terminals and ancillary products for aggregate revenue of approximately $14.1 million, $714,000 of which the Company recorded as revenue in Q1 FY'08 and approximately $13.4 million that the Company expects to recognize over the terms of the contracts. The Company expects that opportunities to provide new and replacement units as well as new systems and services in the market will continue going forward.

Consistent with its goal of optimizing net gaming revenue, in Oklahoma Multimedia continues the strategic transition of its linked, standard sequence bingo games and server-based compact games installed base to one-touch, stand-alone offerings. The table below breaks out by product line Multimedia's end-of-period, Oklahoma installed player terminal base at February 29, 2008 and January 31, 2007. In addition, as of February 29, 2008, Multimedia had placed approximately 179 proprietary stand-alone units at Oklahoma tribal gaming facilities.

The Company will meaningfully increase its floor presence in Oklahoma in 2008 due in large part to the completion of a key customer's expanded facility in southern Oklahoma. The initial phase of this expansion is expected to open in July 2008, at which time Multimedia expects to add 725 units to its installed base at the property. In September 2008 Multimedia expects to add 500 additional units as the second phase of this expansion is completed and then expects to add 175 units in November 2008 for an aggregate increase in the installed base at this property of 1,400 units over the next 8 months.

In the New York Lottery market, Multimedia provides the central determinant system for video lottery terminals ("VLTs") at racetracks in the state, for which it receives 0.75% of the net gaming win for all units installed on the system. As of February 29, 2008, there were approximately 13,100 VLTs installed at racetracks in the state, consistent with levels reported at January 31, 2008.

In February 2008, the New York Racing Association was granted a 25-year franchise to continue to operate the Aqueduct, Belmont Park and Saratoga facilities. The legislation that was passed includes bond financing for the addition of 4,500 VLTs to be installed at Aqueduct and allows the operation of a temporary VLT facility prior to the opening of the permanent facility at that site. The Company expects construction details and timetables for opening of the temporary and permanent VLT facilities at Aqueduct to be announced later this year.

Bank Credit Facility:

The outstanding balance as of February 29, 2008 of Multimedia's $150 million bank credit facility was approximately $100 million, compared with $100 million at January 31, 2008.

Since May 2007, Multimedia been funding its portion of the financing for a key customer's expanded facility in southern Oklahoma and the Company secured placements for approximately 1,400 player terminals related to this funding (as noted above). Through February 29, 2008, Multimedia funded a total of $55 million related to its customer's expanded facility, and at January 31, 2008 the Company had funded a total of $50 million. Upon completion of the funding, expected in May 2008, Multimedia's total funding for this project will approximate $66 million. Pursuant to the agreement with its customer, Multimedia will be repaid from the facility's operating profits in addition to Multimedia's normal revenue share, with repayments commencing when the expanded facility opens.