Redbox 2011 Annual Report Download - page 90

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General terms of our content license agreements with studios are as follows as of December 31, 2011:
Studio End Date
Early Termination
Option Release Date
Sony ................................................. 9/30/2014 September 2012 Day & Date(2)
Paramount ............................................ 12/31/2014(1) None Day & Date(2)
Universal Studios ....................................... 4/21/2012 None Delay(3)
20th Century Fox ....................................... 4/21/2015 April 2013 Delay(3)
Lionsgate ............................................. 8/31/2014 None Day & Date(2)
Warner ............................................... 1/31/2012 None Delay(3)
Other ................................................ Various None Various
(1) Agreement includes, at the studio’s sole discretion, the option for two one-year extensions following the end
date.
(2) Content licensed under the agreement is available for rental on the same day and date as the retail release.
(3) Content licensed under the agreement is available for rental after a certain number of days following the
retail release.
Revenue Share Commitments
Certain of our Retailer agreements include minimum revenue share commitments through the term of the
arrangement. Our minimum commitments under these agreements are presented in the following table:
Dollars in thousands Year Ended December 31,
Total 2012 2013 2014 2015 2016
Redbox ..................................... $ 70,766 $29,629 $22,452 $17,615 $558 $512
Coin ........................................ 41,667 20,000 20,000 1,667 — —
Total minimum commitments ................ $112,433 $49,629 $42,452 $19,282 $558 $512
Letters of Credit
As of December 31, 2011, we had four irrevocable standby letters of credit that totaled $5.5 million. These
standby letters of credit, which expire at various times through 2012, are used to collateralize certain obligations
to third parties. As of December 31, 2011, no amounts were outstanding under these standby letter of credit
agreements.
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 in the Circuit Court for the Twentieth
Judicial Circuit, St. Clair County, Illinois. 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 that Redbox’s rental terms violate the Illinois Rental Purchase Agreement Act or the Illinois
Automatic Contract Renewal Act and the plaintiff is seeking monetary damages and other relief. In November
2009, Redbox removed the case to the U.S. District Court for the Southern District of Illinois. In February 2010,
the District Court remanded the case to the Circuit Court for the Twentieth Judicial Circuit, St. Clair County,
Illinois. In May 2010, the court denied Redbox’s motion to dismiss the plaintiff’s claims, and also denied the
plaintiff’s motion for partial summary judgment. In November 2011, the plaintiff moved for class certification,
and Redbox moved for summary judgment. We believe that the claims against us are without merit and intend to
defend ourselves vigorously in this matter. Currently, no accrual has 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.
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