Redbox 2008 Annual Report Download - page 74
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Please find page 74 of the 2008 Redbox annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.-
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vest on a straight-line basis over three to four years. Holders of redeemable Class B interests have a one-time right,
during the 90-day period commencing December 1, 2012, to require Redbox to redeem their vested redeemable
Class B interests at fair value. The redeemable Class B interests are accounted for under SFAS 123R based on the
fair value of awards at the end of the period. Total compensation expense under the REEIP was $2.2 million and the
related tax benefit was zero for Redbox for the year ended 2008. The unrecognized stock compensation under the
REEIP was $5.1 million at December 31, 2008, which will be recognized over approximately two years. Upon
closing the Redbox transactions, as discussed in Note 18, the REEIP may be re-evaluated.
NOTE 11: INCOME TAXES
The components of income (loss) before income taxes were as follows:
2008 2007 2006
December 31,
(In thousands)
United States operations ............................... $40,429 $(17,945) $36,175
Foreign operations.................................... (10,123) (10,619) (5,475)
Total income (loss) before taxes ........................ $30,306 $(28,564) $30,700
The components of income tax (benefit) expense were as follows:
2008 2007 2006
December 31,
(In thousands)
Current:
United States federal.................................. $ 2,962 $ 1,216 $ 826
State and local ...................................... 159 1,692 617
Foreign ........................................... 952 (77) 447
Total current ...................................... 4,073 2,831 1,890
Deferred:
United States federal.................................. $10,279 $(6,707) $ 9,519
State and local ...................................... 2,248 (1,461) 2,079
Foreign ........................................... (406) (974) (1,415)
Total deferred ..................................... 12,121 (9,142) 10,183
Total tax expense (benefit) ............................... $16,194 $(6,311) $12,073
The income tax (benefit) expense differs from the amount that would result by applying the U.S. statutory rate
to (loss) income before income taxes. A reconciliation of the difference follows:
2008 2007 2006
December 31,
U.S. federal tax expense (benefit) at the statutory rate ....................... 35.0% ⫺35.0% 35.0%
State income taxes, net of federal impact ................................. 5.2% ⫺1.9% 4.8%
Incentive stock options .............................................. 2.4% 1.9% 2.1%
Impact of meeting the indefinite reversal criteria for unremitted foreign earnings . . . 0.0% 0.0% ⫺4.8%
State net operating loss carryforward adjustment ........................... ⫺0.1% 2.6% 3.7%
R&D credit ....................................................... ⫺1.5% ⫺0.2% ⫺3.4%
Change in valuation allowance for deferred tax asset ........................ 11.0% 7.0% 1.2%
Foreign rate differential .............................................. 2.4% 1.9% 0.0%
Other ........................................................... ⫺1.0% 1.6% 0.7%
53.4% ⫺22.1% 39.3%
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