Redbox 2010 Annual Report Download - page 81

Legal Matters
In October 2009, an Illinois resident, Laurie Piechur, individually and on behalf of all others similarly situated,
filed a putative class action complaint against our Redbox subsidiary. The plaintiff alleges that, among other
things, Redbox charges consumers illegal and excessive late fees in violation of the Illinois Consumer Fraud and
Deceptive Business Practices Act and other state statutes, and is seeking monetary damages and other relief as
appropriate. We believe that the claims against us are without merit and intend to defend ourselves vigorously in
this matter. Currently, no accrual had been established as it was not possible to estimate the possible loss or range
of loss because this matter had not advanced to a stage where we could make any such estimate.
Subsequent to December 31, 2010, in January and February 2011, cases were brought purportedly on behalf of a
class of persons who purchased or otherwise acquired our stock during the period, depending on the complaint,
between as early as October 28, 2010 to as late as February 3, 2011. The plaintiffs allege that Coinstar violated
federal securities laws during this period of time by, among other things, issuing false and misleading statements
about current and prospective business and financial results. The plaintiffs claim that, as a result of these alleged
wrongs, our stock price was artificially inflated during the purported class period, and is seeking unspecified
compensatory damages, interest, an award of attorneys’ fees and costs, and injunctive relief. We believe that the
claims against us are without merit and intend to defend ourselves vigorously in this matter. Failure by us to
obtain a favorable resolution of the claims set forth in the complaint could have a material adverse effect on our
business, results of operations and financial condition. Currently, no accrual had been established as it was not
possible to estimate the possible loss or range of loss because this matter had not advanced to a stage where we
could make any such estimate.
NOTE 10: REPURCHASES OF COMMON STOCK
Following our Board of Directors authorization, on December 1, 2010, and consistent with the terms of our credit
facility, we are permitted to repurchase up to (i) $72.5 million of our common stock plus (ii) cash proceeds
received after November 20, 2007 from the exercise of stock options by our officers, directors or employees.
This authorization allowed us to repurchase up to $74.5 million of our common stock as of December 31, 2010.
Repurchased shares become a part of treasury stock. Subsequent to November 20, 2007 and through
December 31, 2010, the authorized cumulative proceeds received from option exercises or other equity purchases
under our equity compensation plans totaled $59.1 million, bringing the total authorized for purchase under our
credit facility to $134.1 million. After taking into consideration our share repurchases of $55.8 million
subsequent to November 20, 2007, the remaining amount authorized for repurchase under our credit facility was
$78.3 million as of December 31, 2010, however we will not exceed our repurchase limit authorized by the board
of directors as outlined below.
Apart from our credit facility limitations, our board of directors authorized the repurchase of up to $72.5 million
of our common stock plus additional shares equal to the aggregate amount of net proceeds received after
January 1, 2003 from our employee equity compensation plans.
The following repurchases were made during the past three years:
Year Ended December 31,
# of Shares
Repurchased
Average Price
Per Share Total Purchase Price
2008 ..................................... 0 $ 0 $ 0
2009 ..................................... 0 0 0
2010 ..................................... 1,072,037 45.94 49,245,014
Total ................................. 1,072,037 $45.94 $49,245,014
NOTE 11: SHARE-BASED PAYMENTS
We grant share-based awards to our employees, non-employee directors and consultants under our 1997
Amended and Restated Equity Incentive Plan (the “1997 Plan”). The 1997 Plan permits the granting of stock
73