10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

ý ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2015

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 000-22555

_______________________________________________________

OUTERWALL INC.

(Exact name of registrant as specified in its charter)

Delaware	94-3156448
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification No.)
1800 114th Avenue SE, Bellevue, Washington	98004
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: 425-943-8000

Securities registered pursuant to Section 12(b) of the Act: Common Stock, $0.001 par value

Name of each exchange on which registered: The NASDAQ Stock Market LLC

Securities registered pursuant to Section 12(g) of the Act: None

_______________________________________________________

Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ý    No  ¨

Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ¨    No  ý

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ý    No  ¨

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K, or any amendment to this Form 10-K.    ý

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	ý	Accelerated filer	¨
Non-accelerated filer	¨ (Do not check if a smaller reporting company)	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  ý

The aggregate market value of the registrant’s common equity held by non-affiliates of the registrant as of June 30, 2015 (the last business day of the registrant’s most recently completed second fiscal quarter), based upon the closing price as reported in the NASDAQ Global Select Market System, was approximately $1.2 billion.

The number of shares outstanding of the registrant’s Common Stock as of January 29, 2016 was 16,614,033 shares.

_______________________________________________________

Documents Incorporated by Reference

The Registrant has incorporated by reference into Part III of this Annual Report on Form 10-K portions of its Proxy Statement for its 2016 Annual Meeting of Stockholders to be filed pursuant to Regulation 14A.

OUTERWALL INC.

FORM 10-K

TABLE OF CONTENTS

		Page
	PART I
Item 1.	Business	3
Item 1A.	Risk Factors	6
Item 1B.	Unresolved Staff Comments	18
Item 2.	Properties	18
Item 3.	Legal Proceedings	18
Item 4.	Mine Safety Disclosures	18
	PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	19
Item 6.	Selected Financial Data	21
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	52
Item 8.	Financial Statements and Supplementary Data	53
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	112
Item 9A.	Controls and Procedures	112
Item 9B.	Other Information	113
	PART III
Item 10.	Directors, Executive Officers and Corporate Governance	113
Item 11.	Executive Compensation	113
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	113
Item 13.	Certain Relationships and Related Transactions, and Director Independence	113
Item 14.	Principal Accounting Fees and Services	113
	PART IV
Item 15.	Exhibits, Financial Statement Schedules	113
SIGNATURES		119

Special Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K (“Annual Report”) contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “should” or “will,” or the negative of such terms. Forward-looking statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks outlined under Item 1A. Risk Factors and elsewhere in this report, that may cause our, or our industry’s, actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. You should not place undue reliance on these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance or achievements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, unless required by law. Unless the context requires otherwise, the terms “Outerwall,” the “Company,” “we,” “us” and “our” refer to Outerwall Inc. and its subsidiaries.

PART I

ITEM 1. BUSINESS

Overview

We were incorporated in Delaware on October 12, 1993 and are a leading provider of automated retail solutions offering convenient products and services that benefit consumers and drive incremental retail traffic and revenue for retailers. In 2013, we changed our name from Coinstar, Inc. to Outerwall Inc. Our core offerings in automated retail include our Redbox business, where consumers can rent or purchase movies and video games from self-service kiosks (“Redbox” segment); our Coinstar business, where consumers can convert their coins to cash and convert coins and cash to stored value products at self-service kiosks (“Coinstar” segment); and our ecoATM business, where consumers can sell certain electronic devices for cash at self-service kiosks and purchase and sell certain electronic devices for cash through an online solution under our recently acquired Gazelle™ brand ("ecoATM" segment).

Summary of Recent Divestitures and Acquisitions

The following is a summary of the acquisitions and divestitures that we made during the last five years:

Year		Transaction
2011	•	We sold our subsidiaries comprising our money transfer business in the second quarter.
2012	•	We entered into a joint venture, Redbox InstantTM by Verizon (the "Joint Venture"), with Verizon Ventures IV LLC (“Verizon”) in the first quarter.(1)
	•	We acquired NCR Corporation’s self-service entertainment DVD kiosk business in the second quarter.
2013	•	We sold certain kiosks previously acquired from NCR through the sale of a previously consolidated entity in the second quarter.(2)
	•	We acquired ecoATM, Inc. ("ecoATM") in the third quarter.(1)(3)
	•	We reclassified four concepts previously included in our former New Ventures operating segment as discontinued operations, Orango™, Rubi™, Crisp Market™, and Star Studio™, in the fourth quarter.(4)
2014	•	We withdrew Redbox as a member of the Joint Venture in the fourth quarter.(1)
2015	•	We completed the shutdown of our Redbox operations in Canada ("Redbox Canada") on March 31, 2015 and reclassified the results of Redbox Canada to discontinued operations.(4)
	•	We acquired certain assets and liabilities of Gazelle, Inc. ("Gazelle") in the fourth quarter.(3)(5)
	•	We made the decision to discontinue our SAMPLEit concept included in our All Other reporting category in the fourth quarter.(3)

Additional information can be found in our Notes to Consolidated Financial Statements as follows:

⁽¹⁾Note 7: Equity Method Investments

⁽²⁾Note 16: Commitments and Contingencies

⁽³⁾ Note 14: Business Segments and Enterprise-Wide Information

⁽⁴⁾Note 12: Discontinued Operations

⁽⁵⁾Note 3: Business Combinations

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Business Segments

Redbox

Within our Redbox segment, we operate 40,480 Redbox kiosks, in 33,060 locations, where consumers can rent or purchase movies and video games. Our Redbox kiosks are available in every U.S. state and Puerto Rico, and are installed primarily at leading grocery stores, mass retailers, drug stores, restaurants and convenience stores including Walgreens, Walmart, Kroger and 7-Eleven. Our Redbox kiosks provide the functionality of a traditional video rental store, yet typically occupy an area of less than twelve square feet. Consumers use a touch screen to select titles, swipe a valid credit or debit card, and receive movie(s) or video game(s). The process is designed to be fast, efficient and fully automated. We generate revenue primarily through fees charged to rent or purchase a movie or video game, and we pay retailers a percentage of our revenue. Typically, the daily rental fee at a Redbox kiosk is a flat fee plus tax for each disc. If the consumer chooses to keep the movie or video game for additional days, the consumer is charged for each additional day at the same daily rental fee. Our consumers can rent a movie or video game from one location and return their rental to any Redbox location. Additionally, our consumers may pre-reserve a movie or video game online or via a smart phone application and pick it up at the selected Redbox location.

Our content library consists of movies and video games available for rent or purchase. We obtain our movie and video game content through revenue sharing agreements and license agreements with studios and game publishers, as well as through distributors and other suppliers. Our goal is to achieve satisfactory availability rates to meet consumer demand while also maximizing our margins. For additional information related to our content license agreements with studios see Note 16: Commitments and Contingencies in our Notes to Consolidated Financial Statements.

Coinstar

Within our Coinstar segment, we own and operate 20,930 kiosks in 19,660 locations. Consumers feed loose change into coin-counting kiosks, which recognize and value the change and then dispense vouchers redeemable for cash or, in some cases, issue stored value products at the consumer’s election. Included in our kiosk and location totals are a limited number of Coinstar Exchange kiosks that exchange gift cards for a voucher redeemable for cash. Our Coinstar kiosks are available across the U.S., where they provide a convenient and trouble-free service to retailers such as Kroger and Walmart, and in Canada, Puerto Rico, Ireland and the United Kingdom. We are the only multi-national, fully automated network of self-service coin-counting kiosks and we are the leader in the U.S. market.

We generate revenue through transaction fees from our consumers and product partners. Each voucher lists the dollar value of coins deposited in the kiosk, less our transaction fee. When consumers elect to have a stored value product issued, the transaction fee normally charged to the consumer for the service is charged instead to the stored value product issuer.

ecoATM

Within our ecoATM business segment, we own and operate 2,250 kiosks in 2,020 locations, where consumers can sell certain electronic devices for cash. Our ecoATM kiosks are located across the U.S., installed primarily in malls, mass retailers and grocery stores. With the acquisition of Gazelle in the fourth quarter of 2015, we acquired www.gazelle.com, adirect-to-consumer online solution for the purchase and sale of certain electronic devices for cash. We generate revenue through the sale of these devices to third party resellers, through online marketplaces and through the Gazelle direct-to-consumer storefront.

Other Concepts and Investments

In addition to our three reportable segments; we may also identify, evaluate, build or acquire, and develop innovative new concepts in the automated retail space. The combined results of the concepts we have operated are included in our All Other reporting category as they do not meet quantitative thresholds to be a separate reportable segment.

Recently, we explored a consumer product sampling kiosk concept called SAMPLEit. We regularly assess the performance of our concepts to determine whether continued funding or other alternatives are appropriate and as a result, we discontinued operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit did not represent a major component of our operations or financial results, the results of SAMPLEit did not qualify to be reported as a discontinued operation and remain in our All Other reporting category.

On occasion, we make strategic investments in external companies that provide automated self-service kiosk solutions. For example, in the health sector we have invested in Pursuant Health, Inc., formerly known as SoloHealth, Inc. See Note 7: Equity Method Investments in our Notes to Consolidated Financial Statements for more information.

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Seasonality

We have experienced seasonality in our revenue from our Redbox segment. December and the summer months have historically been high rental months. April has been a low rental month due, in part, to retail release timing in connection with the Academy Awardsand the Easter holiday that historically has provided stronger content and resulted in higher rentals in March. September and October have been low rental months, due, in part, to the beginning of the school year and the introduction of the new fall television season. By entering into licensing agreements with certain studios that contain delayed rental windows, the availability of titles affected has shifted relative to historic patterns. Seasonal effects, however, may be minimized or increased by the actual release slate, the relative attractiveness of movie titles, and the total box office in a particular quarter or year which may have lingering effects in subsequent periods. Significant recurring events that compete with customer interest for movie content such as the Olympics also have a negative impact on revenue from our Redbox segment. They create competition and affect retail timing, which aims to avoid such events that compete with viewing interest. New video game content releases are concentrated in the fourth quarter due to publisher release schedules and typically drive higher revenue in the fourth quarter.

Our Coinstar segment generally experiences its highest revenue in the second half of the year due to increased retailer foot traffic and holiday shopping in the fourth quarter, along with an increase in consumers’ desire for disposable income in the summer months.

In our ecoATM segment, kiosk transactions generally peak during the summer months, decline in the fourth quarter and remain flat into the following quarter before increasing in early March. Transactions can be significantly impacted by the timing of new phone releases.

Employees

As of December 31, 2015, we had approximately 2,670 employees. Included in this total were approximately 1,730 field service employees throughout the U.S. and internationally, who have broadened our geographic reach to develop and maintain strong relationships with retailers and service our kiosks.

Additional Business Information

See Note 14: Business Segments and Enterprise-Wide Information in our Notes to Consolidated Financial Statements as well as Item 1A. Risk Factors and Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations for additional information related to our segments, intellectual property, competition, limited or sole source suppliers, content, and geographic and significant business relationship information, which information is incorporated herein by reference.

Where You Can Get More Information

We meet information-reporting requirements of the Securities and Exchange Act of 1934 by filing and furnishing to the Securities and Exchange Commission (“SEC”) reports, including annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, as well as amendments thereto. These reports and related materials are available at the SEC website, www.sec.gov, and the SEC’s Public Reference Room at 100 F Street, N.E., Washington, DC 20549. Information on the operation of the SEC’s Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. We make these reports and related materials available, as soon as reasonably practicable after we electronically deliver such materials to the SEC, free of charge on the Investor Relations section of our website, www.outerwall.com.

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ITEM 1A. RISK FACTORS

You should carefully consider the following risk factors that may affect our business, including our financial condition and results of operations. The risks and uncertainties described below are not the only risks we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business. If any of the following risks or uncertainties actually occurs, our business could be harmed, the trading price of our common stock could decline and you could lose all or part of your investment in us.

Competitive pressures could seriously harm our business, financial condition and results of operations.

Our Redbox business faces competition from many other sources, including those using other distribution channels, having more experience, larger or more appealing inventory, better financing, and better relationships with those in the movie and video game industries, including:

• mail-delivery and online content providers, such as Netflix, Hulu, iTunes or Amazon;

• cable, satellite, and telecommunications providers, such as Comcast or DISH Network;

• traditional movie programmers, such as HBO or Showtime;

• traditional brick and mortar video retailers, and other DVD kiosk businesses;

• other retailers such as Walmart and other chain stores selling DVDs and video games;

• video game rental providers, such as GameFly;

• noncommercial sources such as libraries; and

• general competition from other forms of entertainment, such as movie theaters, television and sporting events.

Our Coinstar business faces competition from supermarkets, banks and other companies that obtain coin-counting equipment from companies such as ScanCoin, Cummins-Allison Corporation and others. Our retailers may choose to replace our coin-counting kiosks with competitor machines and operate such kiosks themselves or through a third party, or not carry coin-counting kiosks at all, deciding that floor space could be used for other purposes. In addition, retailers, some of which have significantly more resources than we do, may decide to enter the coin-counting market independently. Some banks and other competitors already provide coin-counting free of charge or for an amount that yields very low margins or that may not generate a profit at all. An expansion of the coin-counting services provided or a reduction in related fees charged by any of these competitors or retailer decisions to use floor space for other than coin-counting, could materially and adversely affect our business and results of operations.

Our ecoATM business, including its Gazelle brand, faces competition from companies whose primary business consists of the purchase of used electronics, including online retailers and websites, as well as brick and mortar stores that buy back used electronics. The business also faces competition from companies in other businesses that also have buyback or leasing programs, such as GameStop, Best Buy, Target, Apple, AT&T, Verizon, T-Mobile and Sprint. These competitors may have significantly more resources than we do or offer their customers a higher price or more convenient offering than we do for the same item. Both the proliferation of such programs and the perceived value to consumers provided by such programs could materially and adversely affect our business and results of operations.

There are many risks related to our Redbox business that may negatively impact our business.

The home video industry is highly competitive with many factors affecting our ability to profitably manage our Redbox business. We have invested, and plan to continue to invest, to maintain our infrastructure of Redbox kiosks in the United States. Now that we have substantially completed our U.S. build-out of Redbox kiosks, optimizing our Redbox business in the United States will depend substantially upon growth or minimizing decline in same store sales. In addition, the home video distribution market is rapidly evolving as newer technologies and distribution channels compete for market share, and we have experienced a secular decline in the physical rental market. As it continues, our business, operating results and financial condition will be adversely affected. Some additional risks that could negatively impact our results include:

• Increased availability of digital movie content and changes in consumer content delivery and viewing options and preferences, including increased use of online streaming, video-on-demand, subscription video-on-demand and time- and place-shifting technologies;

• Increased availability and quality of original programming and similar episodic content, and exclusive arrangements with programmers, such as HBO, Showtime, and Netflix.

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• Decreased quantity and quality of movie content availability for DVD distribution due to changes in quantity of new releases by studios, a trend towards developing more high-budget "event" or "blockbuster" movies, movie content failing to appeal to consumers’ tastes, increased focus on digital sales and rentals, and other general industry-related factors, including financial disruptions, and labor conflicts;

• Due to arrangements with certain studios that provide content on a delayed basis, the availability of some new releases in our kiosks may shift to times when consumers are relatively less likely to rent movies, or may be in genres that are off seasonally, such as a holiday movie unavailable until January; and

• Decreased costs for consumers to purchase or receive movie content, including less expensive DVDs, more aggressive competitor pricing strategies and piracy.

As a result, we expect our Redbox business results to continue to decline over time. Further, any additional adverse developments relating to any of these risks, as well as others relating to our participation in the home video industry, could significantly affect our business, financial condition and operating results.

The termination, non-renewal or renegotiation on materially adverse terms of our contracts or relationships with one or more of our significant retailers, studios or game publishers could seriously harm our business, financial condition and results of operations.

The success of our business depends in large part on our ability to maintain contractual relationships with our partners in profitable locations. Certain contract provisions with our partners vary, including product and service offerings, the service fees we are committed to pay, and the ability to cancel the contract upon notice after a certain period of time. For Redbox and Coinstar, we typically enter multi-year kiosk installation agreements that automatically renew until we, or the retailer, gives notice of termination. Our typical ecoATM agreements allow retailers and mall operators to terminate for convenience with minimal notice. We strive to provide direct and indirect benefits to our partners that are superior to, or competitive with, other providers or systems or alternative uses of the floor space that our kiosks occupy. If we are unable to provide them with adequate benefits, we may be unable to maintain or renew our contractual relationships on acceptable terms, causing our business, financial condition and results of operations to suffer.

Certain retailers account for a substantial amount of our business. For example, we have significant relationships with Wal-Mart Stores, Inc., Walgreen Co., and The Kroger Company, which accounted for approximately 16.6%, 13.4%, and 9.8% of our consolidated revenue from continuing operations, respectively, during 2015. Although we have had, and expect to continue to have, a successful relationship with these partners, changes will continue to occur both in the short- and long-term, some of which could adversely affect our business and reputation. For example, our Redbox, Coinstar and ecoATM relationship with Walmart is governed by contracts that provide either party the right to terminate the contracts in their entirety, or as to any store serviced by the contracts, with or without cause, on as little as 90 days’ notice. Cancellation, adverse renegotiation of or other changes to these relationships could seriously harm our business and reputation.

Our business also depends on our ability to obtain adequate content from movie studios and video game publishers. We have entered into licensing agreements with certain studios to provide delivery of their DVDs by the “street date,” the first date on which DVD releases are available to the general public for home entertainment purposes on either a rental or sell-through basis. In addition, we have licensing arrangements with other studios that make DVDs available for rent 28 days after the street date. If we are unable to maintain or renew our current relationships to obtain movie or video game content on acceptable terms, our business, financial condition and results of operations may suffer.

Our inability to receive delivery of DVDs on the date of their initial release to the general public, or shortly thereafter, for home entertainment viewing could adversely affect our Redbox business.

Traditionally, businesses that rented movies in physical formats, such as DVDs, had enjoyed a competitive advantage over other movie distribution rental channels. After the initial theatrical release of a movie, the major studios generally had made their movies available on physical formats for a 30- to 45-day release window before release to other movie distribution rental channels, such as pay-per view, video-on-demand, premium television, basic cable, and network and syndicated television.

However, movie studios are experimenting with this model, including shortening or discontinuing altogether, or otherwise restricting, movie distribution windows, including making video-on-demand or other digital delivery methods available prior to, or simultaneous with, the physical DVD release. For example, certain movie studios have made new release titles available on video-on-demand or for online purchase on the same date as the DVD release, and certain movies have been made available via premium video-on-demand while they are still in theaters. Further, some studios have implemented restrictions on renting DVDs for weeks following the initial release of the same title for purchase. For example, Redbox has entered into arrangements with certain studios that include delayed rental windows. Entering into these studio licensing arrangements that contain a delayed rental window may decrease consumer satisfaction and consumer demand, and we may lose consumers to our competitors that offer access to titles without a delayed window. In addition, studios may seek to impose longer delays, or

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studios that currently provide content on the street date may seek similar delays. Any of these developments could have a material adverse effect on our business, financial condition and results of operations.

If we do not manage our content library effectively, our business, financial condition and results of operations could be materially and adversely affected.

A critical element of our Redbox business model is to optimize our library of DVD titles, formats, and copy depth to achieve satisfactory availability rates to meet consumer demand while also maximizing margins. If we do not timely acquire sufficient DVD titles, due to, for example, not correctly anticipating demand, intentionally acquiring fewer copies than needed to fully satisfy demand or the lack of available titles, we may not appropriately satisfy consumer demand, which could decrease consumer satisfaction and we could lose consumers to competitors. Conversely, if we attempt to mitigate this risk and acquire a larger number of copies to achieve higher availability rates for select titles or a wider range of titles, our library utilization would become less efficient and our margins for the Redbox business would be adversely affected, such as what occurred in the fourth quarter of 2015 when we purchased additional content to encourage consumers to return to normal rental patterns. Our ability to accurately predict consumer demand as well as market factors, such as our ability to obtain satisfactory distribution arrangements, may impact our ability to timely acquire appropriate quantities of certain DVD titles. In addition, if we are unable to obtain or maintain favorable terms from our suppliers with respect to such matters as timely movie access, copy depth, formats and product destruction, among others, or if the price of DVDs increases or decreases generally or for certain titles, our library may become unbalanced and our margins may be adversely affected.

Further, the delay in our ability to rent certain studios’ DVD titles pursuant to a delayed rental window may negatively affect consumer satisfaction and demand, and we could lose consumers to our competitors because of the timing of our library.

We have entered into licensing agreements with certain studios to allow rental of their titles on the “street date,” and with other studios to make DVDs available for rent 28 days or more after the street date. Our business, financial condition and results of operations could be materially and adversely affected if these agreements do not provide the expected benefits to us. For example, agreements may require us to license minimum quantities of theatrical and direct-to-video DVDs for rental at our kiosks. If the titles or format provided are not attractive to our consumers, we could be required to purchase too many copies of undesirable titles or an undesirable format, possibly in substantial amounts, which could adversely affect our Redbox business by decreasing consumer demand for offered DVD titles and consumer satisfaction with our services or negatively impacting margins. If studios that do not have a delayed rental window elect to delay the general release of DVDs to the rental market for significant periods after they are released for retail sales, demand for rental of these titles may be adversely affected. In addition, we have incurred, and may continue to incur, additional non-cash increases to operating expenses, which are amortized over the terms of any such arrangements, that also could have a dilutive impact on our stockholders, such as the issuance of equity under certain of our existing studio contracts or to the extent we enter into similar arrangements with other movie studios in the future. Further, if some or all of these agreements prove beneficial but are early terminated, we could be negatively impacted. Moreover, if we cannot maintain similar arrangements in the future with these or other studios or distributors, or these arrangements do not provide the expected benefits to us, our business could suffer.

In addition, if we are unable to comply with, or lack the necessary internal controls to ensure appropriate documentation and tracking of our content library, we may, among other things, violate certain of our studio licensing arrangements, be forced to pay a fee for unaccounted for DVDs and be susceptible to risks of theft and misuse of property, any of which may negatively affect our margins in the Redbox business. Any of these developments could have a material adverse effect on our business, financial condition and results of operations.

Defects, failures or security breaches in and inadequate upgrades of, or changes to, our operating systems could harm our business.

The operation of our business depends on sophisticated software, hardware, and computer networking and communication services that may contain undetected errors or may be subject to failures or complications. These errors, failures or complications may arise particularly when new, changed or enhanced products or services are added. In the past, there have been limited delays and disruptions resulting from upgrading or improving these operating systems. Future upgrades, improvements or changes that may be necessary to expand and maintain our business could result in delays or disruptions or may not be timely or appropriately made, any of which could seriously harm our operations.

Further, certain aspects of the operating systems relating to our business are provided by third parties, including telecommunications. Accordingly, the effectiveness of these operating systems is, to a certain degree, dependent on the actions and decisions of third parties over whom we may have limited control.

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Failure to adequately comply with privacy notices, information security policies, standards or legal requirements or to adequately safeguard against breaches of such policies, standards or requirements could adversely affect our operations and could damage our business, reputation, financial position and results of operations.

As our business expands to provide new products and services, such as ecoATM, including its Gazelle brand, Coinstar Exchange, and as we continue our efforts to enhance the Redbox customer experience, we are increasing the amount of consumer data that we collect, transfer, retain and use as part of our business. These activities are subject to laws and regulations, as well as industry standards, in the United States and other jurisdictions in which our products and services are or may be made available. These requirements, which often differ materially and sometimes conflict among the many jurisdictions in which we operate, are designed to protect the privacy of consumers’ personal information and to prevent that information from being inappropriately collected, used or disclosed. We maintain and review technical and operational safeguards designed to protect this information and generally require third party vendors and others with whom we work to do so as well. However, despite those safeguards, it is possible that hackers, employees acting contrary to our policies, third-party agents or others could improperly access relevant systems or improperly obtain or disclose data about our consumers, or that we may be determined not to be in compliance with applicable legal requirements and industry standards for data use and security, such as the Payment Card Industry guidelines. A breach or purported breach of relevant use and security policies or controls that compromises consumer data or determination of non-compliance with applicable legal requirements, privacy notices or industry standards for data use and security could expose us to regulatory enforcement actions, civil litigation, card association or other monetary fines or sanctions, or contractual liabilities, limit our ability to provide our products and services, subject us to legal action and related costs and damage our business reputation, financial position, and results of operations.

Our failure to meet consumer expectations with respect to pricing our products and services may adversely affect our business and results of operations.

Demand for our products and services may be sensitive to pricing changes. We evaluate and update our pricing strategies from time to time, and changes we institute may have a significant impact on, among other things, our revenue and net income. For example, in December 2014the rental price for DVDs increased by 30 cents to $1.50 a day, the price for Blu-ray Discs increased by 50 cents to $2.00 a day, and in January 2015, the rental price for video games increased by $1.00 to $3.00 a day. In the future, other fee increases or pricing changes may deter consumers from using our kiosks or reduce the frequency of their usage.

Payment of increased fees to retailers or other third party service providers could negatively affect our business results.

We face ongoing pricing pressure from our retailers to increase the service fees we pay to them on our products and services or to make other financial concessions to win or retain their business. If we are unable to respond effectively to ongoing pricing-related pressures, we may fail to win or retain certain accounts. Our fee arrangements are based on our evaluation of unique factors with each retailer, such as total revenue, long-term, non-cancelable contracts, installation of our kiosks in high-traffic, geographic locations and new product and service commitments. Together with other factors, an increase in service fees paid, or other financial concessions made to our retailers could significantly increase our direct operating expenses in future periods and harm our business. In addition, we accept payment for movie and game rentals through debit and credit card transactions. For these payments, we pay interchange and other fees, which have increased and may increase further over time. Further, because Redbox processes millions of small dollar amount transactions, and interchange fees represent a larger percentage of card processing costs compared to a typical retailer, we are relatively more susceptible to any fee increase. When interchange or other fees increase, it generally raises our operating costs and lowers our profit margins or requires that we charge our customers more for our products and services.

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We may be unable to attract new partners, broaden current partner relationships, and penetrate new markets and distribution channels.

To increase the availability of our products and services, we need to attract new partners, broaden relationships with current partners, and develop operational efficiencies that make it feasible for us to penetrate lower density markets or new distribution channels, such as Coinstar kiosks in banks and credit unions and the direct-to-consumer channel through Gazelle. We may be unable to attract new retailers or drive down costs relating to the manufacture, installation or servicing of our kiosks to levels that would enable us to operate profitably in lower density markets or penetrate new distribution channels. If we are unable to do so, our future business and financial performance could be adversely affected.

Our future operating results may fluctuate.

Our future operating results will depend significantly on our ability to continue to drive new and repeat use of our Redbox and Coinstar kiosks, our ability to develop and commercialize new products and services, such as ecoATM and Coinstar Exchange, and the costs incurred to do so, and our ability to successfully integrate acquisitions, such as Gazelle, and other third-party relationships into our operations. Our operating results have a history of fluctuating and may continue to fluctuate based upon many factors, including fluctuations in revenue generated by and operating expenses incurred by our different lines of business, seasonality, the timing of the release slate and the relative attractiveness of the titles available for rent in a particular quarter or year which may have lingering effects in subsequent periods, fluctuations in consumer rental patterns, including the number of movies rented per visit, the type of DVDs they want to rent and for how long, the effects of legacy contracts with minimum purchase requirements, and the level of DVD migration between kiosks.

We have experienced seasonality in our revenue from our Redbox segment. December and the summer months have historically been high rental months. April has been a low rental month due, in part, to retail release timing in connection with the Academy Awardsand the Easter holiday that historically has provided stronger content and resulted in higher rentals in March. September and October have been low rental months, due, in part, to the beginning of the school year and the introduction of the new fall television season. By entering into licensing agreements with certain studios that contain delayed rental windows, the availability of titles affected has shifted relative to historic patterns. Seasonal effects, however, may be minimized or increased by the actual release slate, the relative attractiveness of movie titles, and the total box office in a particular quarter or year which may have lingering effects in subsequent periods. Significant recurring events that compete with customer interest for movie content such as the Olympics also have a negative impact on revenue from our Redbox segment. They create competition and affect retail timing, which aims to avoid such events that compete with viewing interest. New video game content releases are concentrated in the fourth quarter due to publisher release schedules and typically drive higher revenue in the fourth quarter.

Our Coinstar segment generally experiences its highest revenue in the second half of the year due to increased retailer foot traffic and holiday shopping in the fourth quarter, along with an increase in consumers’ desire for disposable income in the summer months.

In our ecoATM segment, kiosk transactions generally peak during the summer months, decline in the fourth quarter and remain flat into the following quarter before increasing in early March. Transactions can be significantly impacted by the timing of new phone releases.

10

If we cannot manage our business effectively, we could experience a material adverse effect on our financial condition and results of operations.

We have experienced periods of substantial change in our business, particularly due to Redbox, and more recently, the acquisition of ecoATM and Gazelle. These changes have placed, and may continue to place, significant demands on our operational, financial and administrative infrastructure and our management. As our operations have grown in size, scope and complexity, we have focused on integrating, improving and upgrading our systems and infrastructure related to providing attractive and efficient consumer products and services, and our administration and internal systems, processes and controls. For example, management has had to adapt to and provide oversight for an increasingly decentralized organization as Redbox and ecoATM operations have remained primarily in Oakbrook Terrace, Illinois, and San Diego, California, respectively, while Outerwall’s corporate headquarters and Coinstar operations have remained in Bellevue, Washington. This integration and expansion of our administration, processes, systems and infrastructure have required us to commit, and may continue to cause us to commit, substantial financial, operational and technical resources to managing our business.

Although we believe the total addressable market for automated kiosks is large, we cannot be certain about its size, the most effective plan for locating kiosks, or the optimum market density. Because the kiosk market and our business model are continually evolving, we have incomplete data and track records for predicting kiosk and market performance in future periods. As a result, we may make errors in predicting and reacting to relevant business trends, which could have a material adverse effect on our business, financial condition and results of operations. For example, we may, among other things, over-install kiosks in certain geographic areas leading to non-accretive installations, and we cannot be certain that historical revenue ramps for new kiosks will be sustainable in the future.

Managing our business changes will require significant expenditures and allocation of valuable management and operational resources. If we fail to achieve the necessary level of efficiency in our organization, including effectively evolving and growing our business lines, our business, operating results and financial condition could be harmed.

If we cannot execute on our strategy and offer new retail products and services, our business could suffer.

Our strategy is based upon leveraging our core competencies in the retail space to provide the consumer with convenience and value and to help retailers drive incremental traffic and revenue. To be competitive, we need to offer new product and service offerings that are accepted by the market and establish third-party relationships necessary to develop and commercialize such product and service offerings. We are exploring new businesses to enter, and new products and services to offer, however, the complexities and structures of these new businesses and products could create conflicting priorities, constrain limited resources, and negatively impact our core businesses. We may use our financial resources and management’s time and focus to invest in other companies offering retail services, such as our acquisition of ecoATM, we may seek to grow businesses organically, or we may seek to offer new products or services on our current kiosks, such as Coinstar Exchange gift card exchange. We may enter into joint ventures through which we may expand our product and service offerings. Any new business opportunity also may have its own unique risks related to operations, finances, intellectual property, technology, legal and regulatory issues, corporate governance or other challenges, for which we may have limited or no prior experience. In addition, if we fail to timely establish or maintain relationships with significant retailers and suppliers, we may not be able to provide our consumers with desirable new products and services. Further, to develop and commercialize certain new products and services, we will need to create new kiosks or enhance the capabilities of our current kiosks, as well as adapt our related networks and systems through appropriate technological solutions for a retail environment, and establish market acceptance of such products or services. We cannot assure you that new products or services that we provide will be successful or profitable.

11

Acquisitions and investments involve risks that could harm our business and impair our ability to realize potential benefits from such acquisitions and investments.

As part of our business strategy, we have in the past sought, and may in the future seek, to acquire or invest in businesses, products or technologies that we feel could complement or expand our business. For example, we acquired ecoATM in July 2013 and Gazelle in November 2015. However, we may be unable to adequately address the financial, legal and operational risks raised by such acquisitions or investments and may not successfully integrate these acquisitions or investments, which could harm our business and prevent us from realizing the projected benefits of the acquisitions and investments. In addition, we may not have the right or power to direct the management or policies of companies we have invested in. Further, the evaluation and negotiation of potential acquisitions and investments, as well as the integration of acquired businesses, divert management time and other resources. Accordingly, we cannot assure you that any particular transaction, even if successfully completed, will ultimately benefit our business. Certain financial and operational risks related to acquisitions and investments that may have a material impact on our business are:

• the assumption of known and unknown liabilities of an acquired company, including employee and intellectual property claims and other violations of applicable law;

• losses related to acquisitions and investments;

• managing relationships with other investors and the companies in which we have made investments, including, in some cases, as minority partner;

• reduced liquidity, including through the use of cash resources and incurrence of debt and contingent liabilities in funding acquisitions and investments;

• entrance into markets in which we have no direct prior experience, and where we face competition from many other companies, including those having more experience, better financing, or better relationships with others in the industry than we have;

• impairment of goodwill and acquired intangible assets arising from our arrangements and investments;

• difficulties and expenses in assimilating the operations, products, technology, information systems or personnel of an acquired company, acquired assets or joint ventures;

• inability to efficiently divest unsuccessful acquisitions and investments;

• stockholder dilution if an acquisition is consummated through an issuance of our securities;

• imposition of restrictive covenants and increased debt service obligations that provide us less flexibility in how we operate our business to the extent we borrow to finance an acquisition or investment;

• amortization expenses related to acquired intangible assets and other adverse accounting consequences;

• costs incurred in identifying and performing due diligence on potential targets and negotiating agreements that may or may not be successful, including payment of break-up fees if transactions are not closed; and

• impairment of relationships with employees, retailers and affiliates of our business and the acquired business.

We depend upon third-party manufacturers, suppliers and service providers for key components and substantial support for our kiosks.

We conduct limited manufacturing operations and depend on outside parties to manufacture key components of our kiosks. We intend to continue to expand our installed base of kiosks. Such expansion may be limited by the manufacturing capacity of our third-party manufacturers and suppliers. Third-party manufacturers may not be able to meet our manufacturing needs in a satisfactory and timely manner. If there is an unanticipated increase in demand for our kiosks or our manufacturing needs are not met in a timely and satisfactory manner, we may be unable to meet demand due to manufacturing limitations.

Some key hardware components used in our kiosks are obtained from a limited number of suppliers. We may be unable to continue to obtain an adequate supply of these components from our suppliers in a timely manner or, if necessary, from alternative sources. If we are unable to obtain sufficient quantities of components from our current suppliers or locate alternative sources of supply on a timely basis, we may experience delays in installing or maintaining our kiosks, either of which could seriously harm our business, financial condition and results of operations.

12

In addition, we rely on third-party service providers for substantial support and service efforts that we currently do not provide directly. In particular, we contract with third-party providers to arrange for pick-up, processing and depositing of coins, as well as to provide limited servicing of our kiosks. We generally contract with a single transportation provider and coin processor to service a particular region. We do not currently have, nor do we expect to have in the foreseeable future, the internal capability to provide back-up coin processing service in the event of a sudden disruption in service from a commercial coin processor. Any failure by us to maintain our existing coin processing relationships or to establish new relationships on a timely basis or on acceptable terms could harm our business, financial condition and results of operations.

There are risks associated with conducting our business and sourcing goods internationally.

We currently have Coinstar operations in Canada, the United Kingdom and Ireland. We expect to continue our deployment of kiosks internationally. Accordingly, political uncertainties, economic changes, exchange rate fluctuations, restrictions on the repatriation of funds, adverse changes in legal requirements, including tax, tariff and trade regulations, difficulties with foreign distributors, operating challenges and other difficulties in managing an organization outside the U.S., could seriously harm the development of our business and ability to operate profitably. For example, in January 2015, we made the decision to shut down our Redbox operations in Canada as the business was not meeting the company's performance expectations. Further, as we do more business in an increasing number of countries, our business becomes more exposed to the impact of the political and economic uncertainties, including government oversight, of foreign jurisdictions.

We purchase products from vendors that obtain a significant percentage of such products from foreign manufacturers. As a result, we are subject to changes in governmental policies, exchange rate fluctuations, various product quality standards, the imposition of tariffs, import and export controls, transportation delays and interruptions and political and economic disruptions which could disrupt the supply and timely delivery of products manufactured abroad. In addition, we could be affected by labor strikes in the sea shipping, trucking and railroad industries. A reduction or interruption in supplies or a significant increase in the price of one or more supplies could have a material adverse effect on our business.

We are subject to substantial federal, state, local and foreign laws and government regulation specific to our business.

Our business is subject to federal, state, local and foreign laws and government regulation, including those relating to copyright law, access to kiosks in public places, consumer privacy and protection, data protection and information security, taxes, secondhand dealers, vehicle safety, charitable fundraising, the transfer of money or things of value, coins, currency controls, weights and measures, payment cards and other payment instruments, sweepstakes, and contests. The application of existing laws and regulations, changes in laws or enactment of new laws and regulations, that apply, or may in the future apply, to our current or future products or services, changes in governmental authorities’ interpretation of the application of various government regulations to our business, or the failure or inability to gain and retain required permits and approvals could materially and adversely affect our business. For example, if the U.S. government was to pass laws or adopt regulations to phase out certain coins, as previously happened with the penny in Canada, it could have a material and adverse effect on our Coinstar business.

In addition, many jurisdictions require us to obtain certain licenses in connection with the operations of our businesses. There can be no assurance that we will be granted all necessary licenses or permits in the future, that current licenses or permits will be renewed or that regulators will not revoke current licenses or permits. Given the unique nature of our business and new products and services we may develop or acquire in the future, the application of various laws and regulations to our business is uncertain. Further, as governmental and regulatory scrutiny and action with regard to many aspects of our business increase, we expect that our costs of complying with the applicable legal requirements may increase, perhaps substantially.

In many jurisdictions, ecoATM is subject to secondhand dealer laws that regulate the purchase of used goods, such as the phones it purchases from consumers at kiosks. Such laws contain requirements, or laws may be amended or enacted to create requirements, with which we cannot comply, thus requiring us to cease operations in certain jurisdictions. Moreover, a few legislatures have in the past enacted laws which directly restrict or prohibit businesses like ecoATM, and potentially Coinstar Exchange, from operating. If additional similar laws are enacted at either the state or local level, or if existing laws are held to apply to our businesses, our ability to operate may be adversely impacted, thereby damaging our business and results of operations.

Also, if U.S. copyright law were altered to amend or eliminate the First Sale Doctrine, our business could be adversely affected. Under U.S. copyright law, the First Sale Doctrine provides that once a copyright owner sells a copy of his work, the copyright owner relinquishes all further rights to sell or otherwise dispose of that copy. While the copyright owner retains the underlying copyright to the expression fixed in the work, the copyright owner gives up his ability to control the fate of the work once sold. As such, once we purchase a DVD in the market, we are permitted to re-sell it, rent it or otherwise dispose of it. Although the majority of our content library is licensed directly from studios, and not purchased, if Congress or the courts were to change, or substantially limit, this First Sale Doctrine, our ability to obtain certain purchased content and then rent it could be adversely affected.

13

Failure to comply with these laws and regulations could result in, among other things, revocation of required licenses or permits, loss of approved status, termination of contracts, administrative enforcement actions and fines, class action lawsuits, cease and desist orders and civil and criminal liability. The occurrence of one or more of these events, as well as the increased cost of compliance, could materially adversely affect our business, financial condition and results of operations.

Events outside of our control, including the economic environment, have negatively affected, and could continue to negatively affect, consumers’ use of our products and services.

Our consumers’ use of many of our products and services is dependent on discretionary spending, which is affected by, among other things, economic and political conditions, consumer confidence, interest and tax rates, and financial and housing markets. With economic uncertainty still affecting potential consumers, we may be impacted by more conservative purchasing tendencies with fewer non-essential products and services purchases during the coming periods if the current economic environment continues. In addition, because our business relies in part on consumers initially visiting retailers to purchase products and services that are not necessarily our products and services, if consumers are visiting retailers less frequently and being more careful with their money when they do, these tendencies may also negatively impact our business.

Further, our ability to obtain additional funding in the future, if and as needed, through equity issuances or loans, or otherwise meet our current obligations to third parties, could be adversely affected if the economic environment continues to be difficult. In addition, the ability of third parties to honor their obligations to us could be negatively impacted, as retailers, suppliers and other parties deal with the difficult economic environment. Finally, there may be consequences that will ultimately result from the current economic conditions that are not yet known, and any one or more of these unknown consequences (as well as those currently being experienced) could potentially have a material adverse effect on our financial condition, operating results and liquidity, as well as our business generally.

Our business can be adversely affected by severe weather, natural disasters and other events beyond our control, such as earthquakes, fires, power failures, telecommunication loss and terrorist attacks.

A catastrophic event that results in the destruction or disruption of any of our critical business or information technology systems could harm our ability to conduct normal business operations and our operating results. For example, our corporate headquarters and certain critical business operations are located in the Bellevue, Washington area, which is near major earthquake faults. While we have taken steps to protect the security of critical business processes and systems and have established certain back-up systems and disaster recovery procedures, any disruptions, whether due to inadequate back-up or disaster recovery planning, failures of information technology systems, interruptions in the communications network, or other factors, could seriously harm our business, financial condition and results of operations.

In addition, our operational and financial performance is a direct reflection of consumer use of and the ability to operate and service our kiosks used in our business. Severe weather, natural disasters and other events beyond our control can, for extended periods of time, significantly reduce consumer use of our products and services as well as interrupt the ability of our employees and third-party providers to operate and service our kiosks. For example, in October 2012, Hurricane Sandy caused disruptions to our normal operations in the impacted region for an extended period of time. In some cases, severe weather, natural disasters and other events beyond our control may result in extensive damage to, or destruction of, our infrastructure and equipment, including loss of kiosks used to provide our products and services, which losses may not be fully covered by insurance.

Our business involves the movement of large sums of money, and, as a result, our business is particularly dependent on our ability to process and settle transactions accurately and efficiently.

Our business involves the movement of large sums of money. Our Coinstar business requires the effective transfer of large sums of money between many different locations. Because we are responsible for large sums of money that often are substantially greater than the revenues generated, the success of our business particularly depends upon the efficient, secure, and error-free handling of the money. We rely on the ability of our employees and our operating systems and network to process these transactions in an efficient, uninterrupted and error-free manner. In the event of a breakdown, catastrophic event, security breach, improper operation or any other event impacting our systems or network or our vendors’ systems or processes, or improper or other actions taken by employees, or third party vendors, we could suffer financial loss, loss of consumers, regulatory sanctions and damage to our reputation.

14

We may be unable to adequately protect our intellectual property or enforce our patents and other proprietary rights.

Our success depends, in part, on our ability to protect our intellectual property and maintain the proprietary nature of our technology through a combination of patents, trademarks, copyrights, trade secrets, licenses and other intellectual property arrangements. We have over 100 U.S. and international patents. For example, we have patents regarding kiosk systems for DVD rentals, managing credits and security and inventory management related to our Redbox business, and patents regarding coin counting, kiosk networking, fraud avoidance and voucher authentication related to our Coinstar business. We also have patents and other rights in the United States, Canada and Europe related to our various kiosk technologies, including U.S. patents on kiosk systems for identifying and analyzing electronic devices relating to our ecoATM business. In addition, we may apply for or obtain (through development, acquisition or otherwise) additional patents regarding technologies used in our businesses.

Our patents may not be held valid if challenged, our patent applications may not be issued, and other parties may claim rights in or ownership of our patents and other proprietary rights. Patents issued to us may be circumvented or fail to provide adequate protection of our technologies. Our competitors might independently develop or patent technologies that are substantially equivalent or superior to our technologies. Further, since patent terms are limited, other parties may begin practicing our patented technologies when our related patents expire.

In addition, certain parties may assert claims of patent infringement or misappropriation against us based on current or pending U.S. or foreign patents, copyrights or trade secrets, or contracts. If such claims were successful, our business could be harmed. Defending ourselves, our retailers or other third parties against these types of claims, regardless of their merits, or initiating litigation to enforce our rights, could require us to incur substantial costs, divert the attention of key personnel and result in an award of substantial damages. Parties making these types of claims may be able to obtain injunctive or other equitable relief, which could effectively block or impair our ability to provide our DVD, coin-counting or other products and services in the United States or abroad. If third parties have, or obtain, proprietary rights that our products or services infringe, we may be unable to obtain necessary licenses from others at a reasonable cost or at all. The failure to protect our intellectual property rights effectively or to avoid infringing the intellectual property rights of others, as well as unfavorable rulings or settlements, could seriously harm our business, financial condition and results of operations.

Litigation, arbitration, mediation, regulatory actions, investigations or other legal proceedings could result in material rulings, decisions, settlements, fines, penalties or publicity that could adversely affect our business, financial condition and results of operations.

Our business has in the past been, is currently and may in the future continue to be, party to class actions, regulatory actions, investigations, arbitration, mediation and other legal proceedings. The outcome of such proceedings is often difficult to assess or quantify. Plaintiffs, regulatory bodies or other parties may seek very large or indeterminate amounts of money from us or substantial restrictions on our business activities, and the results, including the magnitude, of lawsuits, actions, settlements, decisions and investigations may remain unknown for substantial periods of time. The cost to defend, settle or otherwise finalize lawsuits, regulatory actions, investigations, arbitrations, mediations or other legal proceedings may be significant and such proceedings may divert management’s time. For example, in recent years we have been involved in consumer class action lawsuits, a securities class action and derivative lawsuit, and studio litigation, as well as other litigation in the ordinary course of business. In addition, there may be adverse publicity associated with any such developments that could decrease consumer acceptance of our products and services. As a result, litigation, arbitration, mediation, regulatory actions or investigations involving us or our affiliates may adversely affect our business, financial condition and results of operations.

The loss of key personnel or the inability of replacements to quickly and successfully perform in their new roles could adversely affect our business.

In recent years, we have experienced significant changes in our senior management team, including changes in our CEO and the presidents of our business lines. Further changes in senior management could result in disruptions to our operations. If we lose or terminate the services of one or more of our current executives or key employees or if one or more of our current or former executives or key employees joins a competitor or otherwise leaves or competes with us, it could harm our business and our ability to successfully implement our business plan. Additionally, if we are unable to timely hire qualified replacements for our executive and other key positions, our ability to execute our business plan could be harmed. Even if we can timely hire qualified replacements, we would expect to experience operational disruptions and inefficiencies during any transition.

15

Our stock price has been, and may continue to be, volatile.

Our stock price has fluctuated substantially since our initial public offering in July 1997. For example, during the year ended December 31, 2015, the closing price of our common stock ranged from $84.45 to $36.54 per share. Our stock price may fluctuate significantly in response to a number of factors, including:

• operating results below market expectations and changes in, or our failure to meet, financial estimates of securities analysts or our own guidance;

• period-to-period fluctuations in our financial results;

• the termination, non-renewal or re-negotiation of one or more retailer, supplier, distributor, or other third-party relationships;

• trends and fluctuations in the use of our different lines of business;

• changes in management;

• acquisition, merger, investment and disposition activities;

• share repurchases and dividends;

• announcements of technological innovations or new products or services by us or our competitors;

• announcements regarding the establishment, modification or termination of relationships regarding the development of new or enhanced products and services;

• release of analyst reports;

• mix of our stockholders at a given time, including percentage holdings of institutional, activist or retail investors, and various actions that may be taken by our stockholders that could cause speculation or market perception relating to our stock that is inconsistent with the fundamentals or prospects of our business;

• the level of demand for our stock, including the amount of short interest in our stock;

• economic or other external factors, for example, those relating to the current economic environment and fluctuations in the trading price of stocks generally;

• ineffective internal controls; and

• industry developments.

In addition, the securities markets have experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also seriously harm the market price of our common stock.

Our anti-takeover mechanisms may affect the price of our common stock and make it harder for a third party to acquire us without the consent of our board of directors.

We have implemented anti-takeover provisions that may discourage takeover attempts and depress the market price of our stock. Provisions in our certificate of incorporation and bylaws could make it more difficult for a third party to acquire us, even if doing so would be beneficial to our stockholders. Delaware law also imposes some restrictions on mergers and other business combinations between us and any acquirer of 15% or more of our outstanding common stock. Furthermore, Washington law may impose additional restrictions on mergers and other business combinations between us and any acquirer of 10% or more of our outstanding common stock. These provisions may make it harder for a third party to acquire us without the consent of our board of directors, even if the offer from a third party may be considered beneficial by some stockholders.

16

Our obligations under our substantial debt could adversely affect our cash flow and business.

As of December 31, 2015, the total principal value of our outstanding debt, including capital leases, was $892.2 million. Our level of indebtedness could have important consequences for you, including:

• increasing our vulnerability to general adverse economic and industry conditions;

• requiring a substantial portion of our cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, thereby reducing our ability to use our cash flow to fund our operations, capital expenditures, share repurchases, dividends and future business opportunities;

• restricting us from making strategic acquisitions or investments or causing us to make non-strategic divestitures;

• limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions and general corporate or other purposes;

• limiting our flexibility in planning for, or reacting to, changes in our business or the industry in which we operate, placing us at a competitive disadvantage compared to our competitors who are less highly leveraged and who, therefore, may be able to take advantage of opportunities that our leverage prevents us from exploiting; and

• exposing us to variability in interest rates, as our borrowings under our credit facility bear interest at variable rates determined by prevailing interest rates and our leverage ratio.

If we are unable to meet our debt obligations, we could be forced to restructure or refinance such obligations, seek additional equity financing or sell assets, which we may not be able to do on satisfactory terms or at all. As a result, we could default on those obligations, which could prevent or impede us from fulfilling our obligations and adversely affect our business.

To service or repay our indebtedness, we will require a significant amount of cash. Our ability to generate cash depends on many factors beyond our control.

Our ability to make payments on our indebtedness, including without limitation any payments required to be made to holders of the Senior Notes due 2021 (the “2021 Notes”), the Senior Notes due 2019 (the “2019 Notes”) or under our credit facility, and to fund our operations, will depend on our ability to generate cash in the future. This, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control.

We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us in an amount sufficient to enable us to pay our indebtedness when due or to fund our other liquidity needs. We may need to refinance all or a portion of our indebtedness on or before maturity, sell assets, reduce or delay capital expenditures, seek additional equity financing or seek other third-party financing to satisfy such obligations. We cannot assure you that we will be able to refinance any of our indebtedness on commercially reasonable terms or at all. Our failure to fund indebtedness obligations at any time could constitute an event of default under the instruments governing such indebtedness, and could trigger a cross default under our other outstanding debt, which could result in an acceleration of such indebtedness.

If we do not comply with the covenants in the credit agreement that governs our credit facility and the indentures that govern the 2021 Notes and the 2019 Notes or otherwise default under them, we may not have the funds necessary to pay all of our indebtedness that could become due.

The credit agreement governing our credit facility and the indentures governing the 2021 Notes and our 2019 Notes will require us to comply with certain covenants that may limit our ability to engage in activities that may be in our long-term best interests. For example, our credit agreement prohibits us from incurring any additional indebtedness, except in specified circumstances, without lender approval. Further, our credit agreement restricts our ability to acquire and dispose of assets, engage in mergers or reorganizations, pay dividends or make investments or capital expenditures. Other restrictive covenants require that we meet a maximum consolidated net leverage ratio and a minimum consolidated interest coverage ratio, each as defined in our credit agreement. A violation of any of these covenants could cause an event of default under our credit agreement, which could result in the acceleration of our outstanding indebtedness.

Our failure to comply with these covenants or others under our indentures could result in an event of default which, if not cured or waived, could result in the acceleration of all of our indebtedness, which would adversely affect our financial health. We cannot assure you that we would have sufficient funds to repay all the outstanding amounts, and any acceleration of amounts due under our credit agreement or the indentures governing our outstanding indebtedness likely would have a material adverse effect on us.

17

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

We are headquartered in Bellevue, Washington. Our corporate administrative, marketing and product development facility in Bellevue, Washington is located in two office buildings, totaling 80,780 square feet under two leases, which expire December 31, 2019. Our Coinstar segment uses part of this space.

Our Redbox subsidiary has offices in Oakbrook Terrace, Illinois and Woodland Hills, California. The Redbox offices in Oakbrook Terrace currently occupy 114,451 square feet under a lease that expires on July 31, 2021. The Redbox offices in Woodland Hills, California currently occupy 16,085 square feet, and these premises are under a lease that expires on May 31, 2022.

Our ecoATM business has facilities in San Diego, California that occupy 53,512 square feet and consist of facilities supporting administration, marketing, engineering, customer service and inventory processing. The lease for this space expires on August 10, 2025. Additionally, with the acquisition of Gazelle in the fourth quarter of 2015, we acquired facilities in Boston, Massachusetts and Louisville, Kentucky that occupy 9,906 square feet and 37,500 square feet, respectively, and consist of facilities supporting administration, marketing, engineering, customer service and inventory processing. The leases for these spaces expire on November 30, 2020 and February 28, 2018, respectively.

ITEM 3. LEGAL PROCEEDINGS

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 alleged 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 complaint. In November 2011, the plaintiff moved for class certification, and Redbox moved for summary judgment. The court denied Redbox's motion for summary judgment in February 2012. The plaintiff filed an amended complaint on April 19, 2012, and an amended motion for class certification on June 5, 2012. The court denied Redbox's motion to dismiss the amended complaint. The amended class certification motion was briefed and argued. At the hearing on plaintiff's amended motion for class certification, the plaintiff dismissed all claims but two and is pursuing only her claims under the Illinois Rental Purchase Agreement Act and the Illinois Automatic Contract Renewal Act. On May 21, 2013, the court denied plaintiff's amended class action motion. On January 29, 2014, the Illinois Supreme Court denied plaintiff’s petition for leave to appeal the trial court’s denial of class certification. Redbox has moved to dismiss all remaining claims on mootness grounds, and the Court granted Redbox’s motion on December 11, 2014. The plaintiffs appealed on January 7, 2015. Oral argument was held November 10, 2015. The Appellate Court affirmed the trial court’s rulings on January 11, 2016. We continue to believe that the claims against us are without merit and intend to defend ourselves vigorously in this matter should plaintiff seek further appellate review. 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.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

18

PART II

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Market Information and Stock Prices

Our common stock is traded on the NASDAQ Global Select Market under the symbol “OUTR.” The following table sets forth the high and low sale prices per share as reported by the NASDAQ Global Select Market for our common stock for each quarter during the last two fiscal years. The quotations represent inter-dealer prices without retail markup, markdown or commission and may not necessarily represent actual transactions.

2015	High		Low
Quarter 1	$	77.94	$	60.83
Quarter 2	$	83.40	$	64.93
Quarter 3	$	85.26	$	56.50
Quarter 4	$	66.68	$	36.51
2014
Quarter 1	$	74.30	$	62.60
Quarter 2	$	72.85	$	57.36
Quarter 3	$	62.49	$	52.72
Quarter 4	$	76.38	$	51.17

The approximate number of holders of record of our common stock at January 29, 2016 was 72.

Dividends

On February 3, 2015, our Board of Directors decided to initiate a quarterly cash dividend. The first cash dividend of $0.30 per outstanding share of our common stock was paid on March 18, 2015, to all stockholders of record on March 3, 2015. Additional cash dividends of $0.30 per outstanding share of our common stock were paid on June 23, 2015, September 15, 2015, and December 8, 2015. While it is our intention to pay quarterly cash dividends for the foreseeable future, the decision to pay future cash dividends will be made by our Board of Directors each quarter and will depend upon, among other things, existing conditions, including earnings, financial condition and capital requirements, restrictions in financing agreements, business opportunities and other conditions and factors, including prospects. We are required to meet certain financial covenants under our Credit Facility and the indentures related to the 2019 Notes and the 2021 Notes in order to pay dividends. We were in compliance with these financial covenants at December 31, 2015.

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Repurchases of Common Stock

On February 3, 2015, our Board of Directors approved an additional stock repurchase program of up to $250.0 million of our common stock plus the cash proceeds received from the exercise of stock options by our officers, directors, and employees. Repurchases may be made through open market purchases, negotiated transactions or other means, including accelerated share repurchases and 10b5-1 trading plans in accordance with applicable securities laws and other restrictions. The share repurchase program will continue until the amount of Outerwall common stock authorized is repurchased or the Board of Directors determines to discontinue or otherwise modify the share repurchase program.

As of December 31, 2015, we were authorized to repurchase up to $256.4 million of our common stock under our share repurchase programs. Repurchased shares become a part of treasury stock.

The following table summarizes information regarding shares repurchased during the quarter ended December 31, 2015:

	Total Number of Shares Repurchased(1)	Average Price Paid per Share		Total Number  of  Shares Purchased as Part of Publicly Announced Repurchase Plans or Programs	Maximum Approximate Dollar Value (in thousands) of Shares that May Yet be Purchased Under the Plans or Programs
10/1/15 - 10/31/15	2,154	$	59.40	—	$	292,718
11/1/15 - 11/30/15	381,697	$	63.74	381,426	$	268,406
12/1/15 - 12/31/15	292,679	$	41.05	292,395	$	256,407
	676,530			673,821

(1) Includes 2,709 shares tendered for tax withholding on vesting of restricted stock awards, none of which are included against the dollar value of shares that may be purchased under programs approved by our Board of Directors.

Unregistered Sales of Equity Securities

On October 2, 2015, we issued 25,000 shares of unregistered restricted common stock to Sony as partial consideration for the extension of our existing content license agreement with Sony discussed in Note 10: Share-Based Payments and Note 16: Commitments and Contingenciesin our Notes to Consolidated Financial Statements. The issuance of the common stock was exempt from registration pursuant to the Securities Act of 1933, as amended (the “Securities Act”) by virtue of Section 4(a)(2) and/or Regulation D promulgated thereunder as a transaction not involving a public offering. We believe that the issuance is exempt from the registration requirements of the Securities Act on the basis that: (1) Sony represented it was an accredited investor as defined under the Securities Act; (2) there was no general solicitation; and (3) Sony represented that it was purchasing such shares for its own account and not with a view towards distribution. The shares of common stock carry a legend stating that the shares are not registered under the Securities Act and therefore cannot be resold unless they are registered under the Securities Act or unless an exemption to registration is available.

On October 16, 2015, Redbox announced a contract extension with Paramount Home Entertainment under the existing terms of the revenue sharing license agreement discussed in Note 10: Share-Based Payments and Note 16: Commitments and Contingenciesin our Notes to Consolidated Financial Statements. The one-year extension required us to issue 50,000 shares of unregistered restricted common stock to Paramount during the first quarter of 2016, pursuant to terms and conditions similar to those of the Sony issuance described above.

Securities Authorized for Issuance under Equity Compensation Plans

For information regarding securities authorized for issuance under equity compensation plans, see Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters, which incorporates by reference to the Proxy Statement relating to our 2016 Annual Meeting of Stockholders.

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ITEM 6. SELECTED FINANCIAL DATA

The selected consolidated financial data below should be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations and the consolidated financial statements and notes thereto included elsewhere in this Form 10-K.

In thousands, except per share data	Years Ended December 31,
Statement of Comprehensive Income Data	2015			2014			2013			2012			2011
Revenue	$	2,193,211		$	2,291,586		$	2,299,785		$	2,198,151		$	1,844,046
Operating income	$	168,875		$	268,404		$	278,876		$	287,493		$	223,014
Income from continuing operations	$	49,446		$	124,677		$	222,688		$	166,303		$	122,934
Loss from discontinued operations, net of tax(1)	(5,109		)	(18,059		)	(47,896		)	(16,073		)	(19,051		)
Net income	$	44,337		$	106,618		$	174,792		$	150,230		$	103,883
Basic earnings per common share from continuing operations	$	2.75		$	5.98		$	7.98		$	5.38		$	3.95
Loss per common share from discontinued operations	(0.29		)	(0.89		)	(1.76		)	(0.53		)	(0.62		)
Basic earnings per share attributable to Outerwall Inc.	$	2.46		$	5.09		$	6.22		$	4.85		$	3.33
Diluted earnings per share from continuing operations per common share	$	2.75		$	5.89		$	7.72		$	5.10		$	3.81
Diluted loss per share from discontinued operations per common share	(0.29		)	(0.88		)	(1.70		)	(0.50		)	(0.60		)
Diluted earnings per share per common share	$	2.46		$	5.01		$	6.02		$	4.60		$	3.21
Weighted average common shares used in basic per share calculations	17,467			20,192			27,216			30,305			30,520
Weighted average common shares used in diluted per share calculations	17,487			20,503			28,169			32,012			31,715
	As of December 31,
Balance Sheet Data	12/31/2015			12/31/2014			12/31/2013			12/31/2012			12/31/2011
Cash and cash equivalents	$	222,549		$	242,696		$	371,437		$	282,894		$	341,855
Total assets	$	1,366,060		$	1,583,286		$	1,891,383		$	1,555,365		$	1,366,625
Total debt, capital lease obligations and other	$	914,497		$	994,085		$	785,292		$	385,760		$	397,099
Common stock	$	485,163		$	473,592		$	482,481		$	504,881		$	481,249
Total stockholders’ equity (deficit)	$	(22,074	)	$	97,378		$	518,689		$	549,088		$	513,902

(1) Discontinued operations for all periods presented includes the results of operations from:

◦ our Redbox Canada operations, which we shut down during the first quarter of 2015;

◦ four ventures previously included in our former New Ventures segment, Orango, Rubi, Crisp Market, and Star Studio, which were discontinued during 2013; and

◦ our Money Transfer Business, which we met the criteria to classify as a discontinued operation in the second quarter of 2010 and sold in June 2011.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our consolidated financial statements and related notes thereto included elsewhere in this Annual Report. Except for the consolidated historical information, the following discussion contains forward-looking statements. Actual results could differ from those projected in the forward-looking statements. Please refer to “Special Note Regarding Forward-Looking Statements” and “Risk Factors” elsewhere in this Annual Report.

Overview

We are a leading provider of automated retail solutions offering convenient products and services that benefit consumers and drive incremental retail traffic and revenue for retailers. Our automated retail business model leverages technology advancements that allow delivery of new and innovative consumer products and services in a compact, automated format. We believe this model positions us to address retailers’ increasing need to provide more in less space driven by increased urbanization and consumers’ increasing expectation of instant gratification. We also have a strong consumer base which we communicate with on a regular basis to drive behavior and increase activity within our retail locations. Our products and services can be found at approximately 63,780 kiosks in leading supermarkets, drug stores, mass merchants, financial institutions, convenience stores, malls and restaurants.

Core Offerings

We have three core businesses:

• Our Redbox business segment (“Redbox”), where consumers can rent or purchase movies and video games from self-service kiosks, is focused on the entertainment consumer sector.

• Our Coinstar business segment (“Coinstar”) is focused on the money consumer sector and provides self-service kiosks where consumers can convert their coins to cash and convert coins and cash to stored value products. We also offer self-service kiosks that exchange gift cards for cash under our Coinstar^™ Exchange brand.

• Our ecoATM business segment (“ecoATM”) is focused on the consumer electronics sector and provides self-service kiosks and an online solution where consumers can sell certain electronic devices for cash and generates revenue through the sale of devices collected to third party resellers, through online marketplaces and through the Gazelle direct-to-consumer storefront.

Other Concepts and Investments

In addition to our three reportable segments; we may also identify, evaluate, build or acquire, and develop innovative new concepts in the automated retail space. The combined results of the concepts we have operated are included in our All Other reporting category as they do not meet quantitative thresholds to be a separate reportable segment.

Recently, we explored a consumer product sampling kiosk concept called SAMPLEit. We regularly assess the performance of our concepts to determine whether continued funding or other alternatives are appropriate and as a result, we discontinued operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit did not represent a major component of our operations or financial results, the results of SAMPLEit did not qualify to be reported as a discontinued operation and remain in our All Other reporting category.

On occasion, we make strategic investments in external companies that provide automated self-service kiosk solutions. For example, in the health sector we have invested in Pursuant Health, Inc., formerly known as SoloHealth, Inc. Additionally, we held an equity interest in ecoATM prior to acquisition in the third quarter of 2013 and on October 20, 2014, Redbox withdrew as a member of Redbox Instant by Verizon (the "Joint Venture"), a joint venture between Redbox and Verizon Ventures IV LLC ("Verizon"). See Note 7: Equity Method Investmentsin our Notes to Consolidated Financial Statements for more information about our strategic investments.

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Strategy

Our strategy is based upon leveraging our core competencies in the automated retail space to provide the consumer with convenience and value and to help retailers drive incremental traffic and revenue. Our competencies include success in building strong consumer and retailer relationships, and in deploying, scaling and managing kiosk businesses. We build strong retailer relationships by providing retailers with turnkey solutions that complement their businesses without significant expenditures of time and financial resources. We believe we have opportunities to continue to manage our businesses for profitability and cash flow by capitalizing on our strengths through the execution of the following strategies:

• Continue to profitably manage our Redbox business. We are focused on profitably managing Redbox through revenue generation and improved kiosk-operations efficiency.

We expect to optimize our business by maintaining our customer base, attracting new customers, testing pricing strategies, leveraging the variable cost structure of the business, improving the Blu-ray rental mix, expanding the availability and depth of new generation video game content and utilizing our customer management tools. Blu-ray drives revenue growth by shifting rentals to its higher revenue price point, $2.00 per night, and generates higher margin dollars per rental. Video games drive revenue by providing Redbox users a low cost access point of $3.00 per night, which is a significant discount to the related purchase price of the new release content. Further, our customer management tools enable us to provide personalized recommendations and promotions to our customers, which help us generate incremental revenue.

While we have completed the build out of our Redbox network in the U.S., we believe we can improve financial performance by redeploying underperforming kiosks to areas with lower kiosk density or with higher consumer traffic. We also have retrofitted a significant percentage of our existing kiosks to provide increased capacity, which enables Redbox to retain discs in the kiosks longer without a material increase in product cost, thereby allowing us to provide greater title selection and copy depth to generate incremental rentals. We also continuously improve our proprietary algorithms allowing Redbox to more accurately predict daily title availability and demand at individual kiosk locations. From a financial perspective, we expect these strategies to partially offset the secular decline in the physical market.

• Optimize and grow revenues from our Coinstar business. We believe we can improve financial performance in our Coinstar business through kiosk optimization. We continue to focus on finding more attractive locations for our existing kiosks, including through redeployment of underperforming kiosks to areas with lower kiosk density or higher consumer traffic. Further, the Coinstar business continues to develop consumer-oriented products and services, such as Coinstar Exchange, and to expand into other channels, such as financial institutions, where we can leverage our Coinstar platform.

• Drive our ecoATM business to profitability. We are focused on achieving segment operating profitability in our ecoATM business. We expect to increase revenue through continued focus on redeploying underperforming and placing existing kiosks in inventory in attractive locations and driving increased productivity at existing kiosks while leveraging expenses as a percentage of revenue as the business scales. We also operate the Gazelle brand, which provides an online solution to buy and sell used electronics which we believe will provide greater leverage and margin enhancement opportunities for our ecoATM business.

• Use our expertise to continue to develop our existing businesses and new innovative retail solutions. Through Redbox and Coinstar, we have demonstrated our ability to profitably scale automated retail solutions. We also leverage those core competencies to identify, evaluate, build or acquire, and develop new automated retail concepts through both organic and inorganic opportunities. For example, in the third quarter of 2013, we acquired ecoATM, one of our previous strategic investments and in November 2015, we acquired Gazelle. We are committed to addressing the changing needs and preferences of our consumers, including through strategic investments and exploring further international opportunities.

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Comparability of Results

We have recast prior period results to reflect the following:

• Discontinued operations, consisting of our Redbox operations in Canada (“Redbox Canada”), which we shut down during the first quarter of 2015. See Note 12: Discontinued Operationsin our Notes to Consolidated Financial Statements for additional information;

• In the first quarter of 2015, we added ecoATM as a separate reportable segment. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts are now included in our All Other reporting category as they do not meet quantitative thresholds to be reported as a separate segment. See Note 14: Business Segments and Enterprise-Wide Information in our Notes to Consolidated Financial Statements for additional information; and

• Calculated basic and diluted earnings per share under the two-class method (the “Two-Class Method”). During the first quarter of 2015, the Two-Class Method became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards as a percentage of total common shares outstanding. See Note 13: Earnings Per Sharein our Notes to Consolidated Financial Statements for additional information.

Additionally, results of operations for Gazelle from the November 10, 2015 acquisition date are included in our ecoATM segment. See Note 3: Business Combinationsin our Notes to Consolidated Financial Statements for additional information.

Recent Events

Subsequent Events

• On January 21, 2016, Redbox entered into an amendment to the existing agreement with Universal Home Entertainment LLC (“Universal”), extending the agreement through December 31, 2017. See Note 16: Commitments and Contingenciesand Note 21: Subsequent Eventsin our Notes to Consolidated Financial Statements for additional information.

• On February 3, 2016, the Board declared a quarterly cash dividend of $0.30 per share expected to be paid on March 29, 2016, to all stockholders of record as of the close of business on March 15, 2016.

Q4 2015 Events

• On December 15, 2015, we repurchased $41.1 million in face value of our 2021 Notes for $34.6 million in cash. The gain from early extinguishment of these Notes was approximately $5.9 million and is included in interest expense, net on our Consolidated Statements of Comprehensive Income.

• On December 8, 2015, we paid a cash dividend of $0.30 per outstanding share of our common stock totaling approximately $5.1 million.

• On November 10, 2015, we acquired certain assets and liabilities of Gazelle, Inc. ("Gazelle") for approximately $18.0 million. The purchase of Gazelle is accounted for as a business combination and included in our ecoATM segment. See Note 3: Business Combinationsin our Notes to Consolidated Financial Statement for additional information.

• On October 16, 2015, Paramount elected to exercise its option to extend our existing content license agreement. This extended the license period through December 31, 2016, with no further options to renew, and required us to issue 50,000 shares of additional restricted stock to Paramount during the first quarter of 2016, which we issued on January 4, 2016.

• During the three months ended December 31, 2015, we repurchased 673,821 shares of our common stock at an average price per share of $53.89 for $36.3 million;

• During the three months ended December 31, 2015, we made the decision to discontinue operating SAMPLEit and recognized a non-cash charge for accelerated depreciation of $5.0 million. SAMPLEit results are included in our All Other reporting category; and

• During the three months ended December 31, 2015, we recorded restructuring charges of $11.3 million, including an $8.5 million one-time payment to settle an outstanding purchase commitment, as we continued to implement actions to further align costs with revenues in our continuing operations. See Note 11: Restructuringin our Notes to Consolidated Financial Statements for additional information.

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Q3 2015 Events

• On September 15, 2015, we paid a cash dividend of $0.30 per outstanding share of our common stock totaling approximately $5.1 million.

• On July 14, 2015, Sony elected to exercise its option to extend our existing content license agreement. This extended the license period through September 30, 2016, with no further options to renew, and required us to issue 25,000 shares of additional restricted stock to Sony during the fourth quarter of 2015, which we issued on October 2, 2015; and

• During the three months ended September 30, 2015, we repurchased 938,586 shares of our common stock at an average price per share of $64.73 for $60.8 million.

Q2 2015 Events

• On June 23, 2015, we paid a cash dividend of $0.30 per outstanding share of our common stock totaling approximately $5.4 million;

• On June 5, 2015, Redbox entered into an amendment to the existing April 22, 2010, agreement with Twentieth Century Fox Home Entertainment LLC (“Fox”) that maintains a 28-day window on Blu-ray Disc and DVD titles through June 30, 2017, and includes a revenue sharing arrangement between Redbox and Fox;

• During the three months ended June 30, 2015, we repurchased 284,537 shares of our common stock at an average price per share of $77.40 for $22.0 million; and

• During the three months ended June 30, 2015, we recognized a goodwill impairment charge of $85.9 million related to our ecoATM business segment. See Note 6: Goodwill and Other Intangible Assets in our Notes to Consolidated Financial Statements and the ecoATM results section below for additional information.

Q1 2015 Events

• On March 31, 2015, we completed the shutdown of the Redbox Canada operations as the business was not meeting performance expectations. The value of the content library and certain capitalized property and equipment consisting primarily of installation costs were amortized over the wind-down period ending on the disposal date of March 31, 2015. See Note 12: Discontinued Operationsin our Notes to Consolidated Financial Statements for additional information;

• On March 31, 2015, we reduced the size of our Redbox headquarters facility in Oakbrook Terrace, Illinois through early termination of operating leases for certain floors. See Redbox results discussion and Note 11: Restructuringin our Notes to Consolidated Financial Statements for additional information;

• On March 26, 2015, we entered into a revenue sharing agreement with Warner Home Video, a division of Warner Bros. Home Entertainment Inc., (the “Warner Agreement”) under which Redbox agrees to license minimum quantities of theatrical and direct-to-video titles for rental through March 31, 2017. The Warner Agreement maintains a 28-day window on such titles.

• On March 18, 2015, we paid a cash dividend of $0.30 per outstanding share of our common stock totaling approximately $5.6 million; and

• During the three months ended March 31, 2015, we repurchased 617,195 shares of our common stock at an average price of $65.96 per share for $40.7 million.

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Results of Operations

Consolidated Results

The discussion and analysis that follows covers our results from continuing operations:

	Years Ended December 31,						2015 vs. 2014					2014 vs. 2013
Dollars in thousands, except per share amounts	2015		2014		2013		$			%		$			%
Revenue	$	2,193,211	$	2,291,586	$	2,299,785	$	(98,375	)	(4.3	)%	$	(8,199	)	(0.4	)%
Operating income	$	168,875	$	268,404	$	278,876	$	(99,529	)	(37.1	)%	$	(10,472	)	(3.8	)%
Income from continuing operations	$	49,446	$	124,677	$	222,688	$	(75,231	)	(60.3	)%	$	(98,011	)	(44.0	)%
Diluted earnings from continuing operations per common share	$	2.75	$	5.89	$	7.72	$	(3.14	)	(53.3	)%	$	(1.83	)	(23.7	)%

Comparing 2015 to 2014

Revenue decreased$98.4 million, or 4.3%, primarily due to:

• $120.8 million decrease from our Redbox segment primarily due to:

◦ 5.8% decrease in same store sales and the removal of underperforming kiosks, partially offset by price increases for movie content implemented in December 2014. The decrease in same store sales was primarily driven by a decline in movie rentals that were impacted primarily by accelerated secular decline in the physical market in 2015 as compared to 2014, lower total box office (representing titles with total North American box office receipts of at least $5.0 million) of movie titles released which was 10.4% lower than the prior year including twenty fewer titles, the timing of the release slate and lower demand for movie content from price-sensitive customers in the first eleven months of 2015 following the price increases which is heightened in periods of weak content; and

◦ A decline in video game rentals due to consumer transition to new generation platforms, limited new release titles available for the new platforms and lower demand from price sensitive customers due to the price increase. This was partially offset by

• $19.4 million increase from our ecoATM segment primarily due to the results of Gazelle being included since the acquisition date and the increase in number of kiosks installed. This was partially offset by a decrease in the average selling prices of value devices sold primarily due to a lower mix of higher value devices and lower collections of value devices per kiosk; and

• $3.0 million increase from our Coinstar segment, primarily due to the increase in the number of Coinstar Exchange kiosks installed.

Operating income decreased$99.5 million, or 37.1%, primarily due to:

• $100.4 million increase in operating loss within our ecoATM segment, primarily due to the $85.9 million goodwill impairment charge recognized in 2015. Excluding the $85.9 million goodwill impairment charge, operating loss increased $14.5 million for our ecoATM segment primarily due to an increase in direct operating expenses and depreciation associated with the increase in the installed kiosk base, partially offset by an increase in revenue;

• $10.0 million increase in operating loss within our All Other reporting category, primarily related to a non-cash charge for accelerated depreciation of $5.0 million from our decision to discontinue operating SAMPLEit and increased operating costs related to SAMPLEit operations.

• $0.9 million decrease in operating income within our Redbox segment primarily due to:

◦ $120.8 million decrease in revenue; and

◦ $23.0 million increase in restructuring and lease termination costs primarily related to implementing actions to further align costs with revenues in our continuing operations, a one-time payment to settle an outstanding purchase commitment, and an early lease termination of certain floors at our Redbox headquarters; partially offset by

◦ $104.8 million decrease in direct operating expenses driven primarily by lower product costs due to lower spending on content and other lower direct expenses primarily from lower credit card fees driven by lower rental volume and lower contractual fees paid to our retail partners due to lower revenue;

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◦ $30.3 million decrease in depreciation and amortization primarily from lower kiosk related depreciation; and

◦ $6.5 million decrease in general and administrative expenses driven by ongoing cost reduction initiatives. This was partially offset by

• $8.5 million decrease in share based expense not allocated to our segments primarily due to the lower expense from rights to receive cash we issued as replacement awards for unvested restricted stock as part of our acquisition of ecoATM in the third quarter of 2013; and

• $3.3 million increase in operating income within our Coinstar segment primarily due to a $3.0 million increase in revenue and lower operating expenses including direct operating, depreciation and amortization, marketing, and research and development, partially offset by an increase in general and administrative and restructuring expenses.

Income from continuing operations decreased$75.2 million, or 60.3%, primarily due to:

• $99.5 million decrease in operating income as described above;

• $7.5 million increase in income tax expense primarily due to higher pre-tax income excluding the non-tax deductible goodwill impairment charge and reduced permanent tax benefits; partially offset by

• $27.9 million lower losses from equity method investments primarily due to our withdrawal from Redbox Instant by Verizon during the fourth quarter of 2014; and

• $5.3 million decrease in interest expense, net primarily due to a decrease in (gain) loss from early extinguishment of debt, as we recognized a gain of $5.9 million in 2015 compared to a loss of $2.0 million in 2014, and lower borrowings, partially offset by a shift in the composition of our debt to higher fixed rate debt.

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Comparing 2014 to 2013

Revenue decreased $8.2 million, or 0.4%, primarily due to:

• $86.0 million decrease from our Redbox segment primarily due to

◦ 4.9% decrease in same store sales primarily due to the relative attractiveness and timing of title releases - while total box office for content released during 2014 increased 8.1%, significantly lower box office during certain periods of 2014, in particular content released in the second and third quarters, led to a lack of strong content throughout the year and contributed to a 7.2% decrease in rentals in 2014; and

◦ $17.1 million decrease in video game rentals primarily due to a lighter release slate during the first and second quarters because of the game industry’s shift to next generation platforms; partially offset by

• $62.4 million increase from our ecoATM segment primarily due to the inclusion of a full year of results subsequent to our acquisition of ecoATM on July 23, 2013 and an increase of 1,010 ecoATM kiosks during the year; and

• $15.4 million increase from our Coinstar segment, primarily due to growth in U.S. same store sales driven by a price increase effective October 1, 2013, higher volume in the U.K. due to an increased kiosk base, growth in U.K. same store sales driven by a price increase effective August 1, 2014 and growth in the number of Coinstar Exchange kiosks.

Operating income decreased $10.5 million, or 3.8%, primarily due to:

• $23.9 million increase in operating loss within our ecoATM segment, primarily from costs associated with scaling the ecoATM business and the inclusion of a full year of results in 2014, partially offset by transaction expenses recognized in 2013 related to the ecoATM acquisition;

• $4.6 million increase in share based expense, which is not allocated to our segments, primarily as a result of rights to receive cash we issued as replacement awards for unvested restricted stock as part of our acquisition of ecoATM in the third quarter of 2013; and

• $0.2 million decrease in operating income within our Redbox segment primarily due to the following items which partially offset the decrease in revenue discussed above:

◦ $46.9 million decrease in direct operating expenses which stayed in line with revenue at 70.1% of revenue in 2014 as compared to 69.4% in 2013;

◦ $25.3 million decrease in general and administrative expenses primarily as a result of ongoing cost reduction initiatives;

◦ $10.6 million decrease in depreciation and amortization expenses primarily due to certain of our kiosk assets becoming fully depreciated; partially offset by

• $16.5 million increase in operating income within our Coinstar segment primarily due to revenue growth.

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Income from continuing operations decreased $98.0 million, or 44.0%, primarily due to:

• $48.7 million increase in loss from equity method investments primarily due to a $68.4 million gain recorded in the third quarter of 2013 on the re-measurement of our previously held equity interest in ecoATM to its acquisition date fair value;

• $26.5 million increase in income tax expense due primarily to discrete tax benefits in 2013;

• $14.8 million increase in interest expense due to increased average borrowings which includes the impact of the $300.0 million principal amount of our 2021 Notes that we issued on June 9, 2014 (see Note 8: Debt and Other Long-Term Liabilitiesin our Notes to Consolidated Financial Statements for more information); and

• $10.5 million decrease in operating income discussed above.

Share-Based Payments and Rights to Receive Cash

Our share-based payments consist of share-based compensation granted to executives, non-employee directors and employees, and share-based payments granted to movie studios as part of content agreements. We grant stock options, restricted stock and performance-based restricted stock to executives and non-employee directors, and restricted stock to our employees. In connection with our acquisition of ecoATM, we also granted certain rights to receive cash (the "rights to receive cash"). We also granted restricted stock to certain movie studios as part of content agreements with our Redbox segment. The expense associated with the grants to movie studios is allocated to our Redbox segment and included within direct operating expenses. The expenses associated with share-based compensation to our executives, non-employee directors, employees and related to the rights to receive cash are part of our corporate function and are not allocated to our segments. The components of our unallocated share-based compensation expense are presented in the following table:

	Years Ended December 31,						2015 vs. 2014					2014 vs. 2013
Dollars in thousands, except per share amounts	2015		2014		2013		$			%		$			%
Direct operating	$	2,561	$	6,585	$	3,636	$	(4,024	)	(61.1	)%	$	2,949		81.1	%
Marketing	695		3,193		1,559		(2,498		)	(78.2	)%	1,634			104.8	%
Research and development	1,737		3,851		1,375		(2,114		)	(54.9	)%	2,476			180.1	%
General and administrative	11,756		11,658		14,164		98			0.8	%	(2,506		)	(17.7	)%
Total	$	16,749	$	25,287	$	20,734	$	(8,538	)	(33.8	)%	$	4,553		22.0	%

* Not meaningful

Unallocated share-based compensation expense decreased$8.5 million, or 33.8% and increased $4.6 million, or 22.0% during the years ended December 31, 2015 and 2014, respectively. These changes are primarily due to the timing of expense recognized for rights to receive cash we issued as replacement awards for unvested restricted stock as part of our acquisition of ecoATM in the third quarter of 2013. See Note 10: Share-Based Payments in our Notes to Consolidated Financial Statements for more information.

Segment Results

Our discussion and analysis that follows covers results of operations for our Redbox, Coinstar and ecoATM segments.

We manage our business by evaluating the financial results of our segments, focusing primarily on segment revenue and segment operating income before depreciation, amortization and other and share-based compensation granted to executives, non-employee directors and employees (“segment operating income”). Segment operating income contains internally allocated costs of our shared services support functions, including but not limited to, corporate executive management, business development, sales, customer service, finance, legal, human resources, information technology, and risk management. We also review depreciation and amortization allocated to each segment.

Management utilizes segment revenue and segment operating income to evaluate the health of our business segments and in consideration of allocating resources among our business segments. Specifically, our CEO evaluates segment revenue and segment operating income, and assesses the performance of each business segment based on these measures, as well as, among other things, the prospects of each of the segments and how they fit into our overall strategy. Our CEO then decides how resources should be allocated among our business segments. For example, if a segment’s revenue increases more than expected, our CEO may consider allocating more financial or other resources to that segment in the future. We periodically evaluate our shared services support function’s allocation methods used for segment reporting purposes, which may result in changes to segment allocations in future periods.

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We also review same store sales for our Redbox and Coinstar segments, which we calculate on a location basis. Most of our locations have a single kiosk, but in locations with a high-performing kiosk, we may add additional kiosks to drive incremental revenue and provide a broader product offering. Same store sales reflects the change in revenue from locations that have been operating for more than 13 months by the end of the reporting period compared with the same locations in the same period of the prior year. We use the average selling price of value devices (non-scrap) sold, number of value devices sold and number of overall devices sold rather than same store sales for our ecoATM business because transactions at the kiosk or purchased by our online solution are for product acquisition, not revenue.

Detailed financial information about our business segments, including our change in reportable segments in the first quarter of 2015 and significant customer relationships is provided inNote 14: Business Segments and Enterprise-Wide Information in our Notes to Consolidated Financial Statements.

Revenue

Our Redbox segment generates revenue primarily through fees charged to rent or purchase a movie or video game, and we pay retailers a percentage of our revenue. Our Coinstar segment generates revenue primarily through transaction fees from our consumers and product partners and we pay retailers a percentage of our revenue. Our ecoATM segment generates revenue through the sale of devices collected to third parties, through online marketplaces and through the Gazelle direct-to-consumer storefront.

Our segment operating expenses include the following categories:

Direct Operating

Direct operating expenses consist primarily of (1) amortization of our content library, (2) transaction fees and commissions we pay to our retailers, (3) credit card fees and coin processing expenses, (4) field operations support, (5) cost to acquire devices that are resold to third parties and consumers through our ecoATM segment, and (6) revenue share we pay to studios. Variations in the percentage of transaction fees and commissions we pay to our retailers may result in increased expenses. Such variations are based on certain factors, such as total revenue, long-term non-cancelable contracts, installation of our kiosks in high traffic and/or urban or rural locations, new product commitments, or other criteria.

Marketing

Our marketing expenses represent our cost of advertising, traditional marketing, online marketing, and public relations efforts in national and regional advertising and major international markets.

Research and Development

Our research and development expenses consist primarily of the development costs of our kiosk software, network applications, machine improvements, and new product development. Research and development expenses represent expenditures to support development and design of our complementary new product ideas and to continue our ongoing efforts to enhance our existing products and services.

General and Administrative

Our general and administrative expenses consist primarily of executive management, business development, supply chain management, finance, management information system, human resources, legal, facilities, risk management and administrative support for field operations.

Depreciation and Amortization

Our depreciation and other expenses consist primarily of depreciation charges on our installed kiosks as well as on computer equipment and leased automobiles.

Detailed financial information about our business segments, including geographic financial information and significant customer relationships is provided inNote 14: Business Segments and Enterprise-Wide Information in our Notes to Consolidated Financial Statements.

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Redbox

	Years Ended December 31,									2015 vs. 2014					2014 vs. 2013
Dollars in thousands, except net revenue per rental amounts	2015			2014			2013			$			%		$			%
Revenue	$	1,760,899		$	1,881,718		$	1,967,715		$	(120,819	)	(6.4	)%	$	(85,997	)	(4.4	)%
Expenses:
Direct operating	1,213,744			1,318,509			1,365,368			(104,765		)	(7.9	)%	(46,859		)	(3.4	)%
Marketing	19,804			20,969			20,835			(1,165		)	(5.6	)%	134			0.6	%
Research and development	—			120			76			(120		)	(100.0	)%	44			57.9	%
General and administrative	129,013			135,554			160,863			(6,541		)	(4.8	)%	(25,309		)	(15.7	)%
Restructuring and related costs (Note 11)	23,540			534			3,771			23,006			NM*		(3,237		)	(85.8	)%
Segment operating income	374,798			406,032			416,802			(31,234		)	(7.7	)%	(10,770		)	(2.6	)%
Less: depreciation and amortization	(118,902		)	(149,236		)	(159,851		)	30,334			(20.3	)%	10,615			(6.6	)%
Operating income	$	255,896		$	256,796		$	256,951		$	(900	)	(0.4	)%	$	(155	)	(0.1	)%
Operating income as a percentage of revenue	14.5		%	13.6		%	13.1		%
Same store sales growth (decline)	(5.8		)%	(4.9		)%	(4.1		)%
Effect on change in revenue from same store sales growth (decline)	$	(107,938	)	$	(95,505	)	$	(76,346	)	$	(12,433	)	13.0	%	$	(19,159	)	25.1	%
Ending number of kiosks	40,480			42,280			42,900			(1,800		)	(4.3	)%	(620		)	(1.4	)%
Total rentals (in thousands)	587,554			717,128			772,872			(129,574		)	(18.1	)%	(55,744		)	(7.2	)%
Net revenue per rental	$	2.99		$	2.62		$	2.54		$	0.37		14.1	%	$	0.08		3.1	%

* Not meaningful

The comparable performance of our content library is continually affected by the ongoing secular decline in the physical market, seasonality, the actual release slate, the relative attractiveness of movie titles, and the total box office in a particular quarter or year, which may have lingering effects in subsequent periods. Now that we have substantially completed our U.S. build-out of Redbox kiosks, optimizing our Redbox business in the United States will depend substantially upon growth or minimizing decline in same store sales. As a result, we expect our Redbox business to continue to decline over time.

2015 Events

• On October 16, 2015, Paramount elected to exercise its option to extend our existing content license agreement. This extended the license period through December 31, 2016, with no further options to renew, and required us to issue 50,000 shares of additional restricted stock to Paramount during the first quarter of 2016, which we issued on January 4, 2016.

• On July 14, 2015, Sony elected to exercise its option to extend our existing content license agreement. This extended the license period through September 30, 2016, with no further options to renew, and required us to issue 25,000 shares of additional restricted stock to Sony during the fourth quarter of 2015, which we issued on October 2, 2015.

• On June 12, 2015, Redbox announced plans to expand the availability of new generation games to all kiosks nationwide and completed this expansion in the fourth quarter of 2015.

• On June 5, 2015, Redbox entered into an amendment to the April 22, 2010, agreement with Fox that maintains a 28-day window on Blu-ray Disc and DVD titles through June 30, 2017, and includes a revenue sharing arrangement between Redbox and Fox.

• On March 31, 2015, as part of restructuring efforts, we reduced the size of our Redbox headquarters facility in Oakbrook Terrace, Illinois through early termination of operating leases for certain floors. In accordance with accounting for exit and disposal activities, we recorded pre-tax charges totaling $11.0 million at the cease use date, March 31, 2015. These charges include $4.4 million for the estimated fair value of our remaining lease obligations including an early termination penalty and $6.6 million in impairments of lease related assets. We have included these costs in restructuring and lease termination costs in our Consolidated Statements of Comprehensive Income.

• On March 26, 2015, we entered into the Warner Agreement under which Redbox agrees to license minimum quantities of theatrical and direct-to-video titles for rental through March 31, 2017. The Warner Agreement maintains a 28-day window on such titles; and

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• During the first quarter of 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the company's performance expectations. The results of Redbox Canada have been presented as discontinued operations on our Consolidated Statements of Comprehensive Income and are no longer included in segment operating results presented above. See Note 12: Discontinued Operationsin our Notes to Consolidated Financial Statements for additional information.

Comparing 2015 to 2014

Revenue decreased$120.8 million, or 6.4%, primarily due to the following:

• $107.9 million decrease from a 5.8% decrease in same store sales primarily due to:

◦ 17.7% decline in total movie rentals primarily driven by accelerated secular decline in the physical market in 2015 as compared to 2014, the lower total box office of movie titles released which was 10.4% lower than the prior year including twenty fewer titles, the timing of the release slate and lower demand for movie content from price-sensitive customers in the first eleven months of 2015 following the price increases discussed below which is heightened in periods of weak content; and

◦ A decline in video game rentals due to consumer transition to new generation platforms, limited new release titles available for those platforms and lower demand from price sensitive customers due to the price increase discussed below; partially offset by

◦ 30 cent increase in the rental price for DVDs to $1.50 per day, effective December 2, 2014, a 50 cent increase in the rental price for Blu-ray Discs to $2.00 per day, effective December 2, 2014, and a $1.00 increase in the rental price for video games to $3.00 per day, effective January 6, 2015.

• $12.9 million decrease in revenue primarily from kiosks removed during 2015, due to continued efforts to optimize our network by removing underperforming kiosks.

We continue to invest in customer-specific promotional offerings to lessen the negative impact on demand driven by the price increases and the secular decline in the physical market.

Net revenue per rental increased$0.37 to $2.99 primarily due to the impact of the increase in daily rental prices discussed above, partially offset by an expected increase in single night rental activity as a result of the price increases.

Blu-ray revenue represented 18.0% of total rental revenue and 14.3% of total disc rentals during 2015 as compared with 17.6% and 14.9% during the prior year. Blu-ray rentals were negatively impacted by fewer Blu-ray releases compared to the prior year and lower demand in the first eleven months of 2015 as compared to the prior year from price-sensitive customers.

Video game revenue represented 3.5% of total revenue and 1.5% of total disc rentals in 2015 as compared with 4.4% and 2.0% during the prior year, primarily due to consumer transition to new generation platforms and underperformance of titles released in the fourth quarter of 2014. Video games also were impacted by lower demand from price-sensitive customers.

Operating income decreased$0.9 million, primarily due to the following:

• $120.8 million decrease in revenue as described above; and

• $23.0 million increase in restructuring and related costs which included restructuring efforts surrounding our Redbox facility as discussed above, a one-time payment to settle an outstanding purchase commitment and severance related expenses; partially offset by

• $104.8 million decrease in direct operating expenses, which were 68.9% of revenue during 2015 as compared with 70.1% during the prior year primarily as a result of:

◦ $52.4 million decrease in product costs to $754.4 million primarily due to lower spending on content in 2015, primarily due to fewer movie releases, a lower average cost per disc due to the mix of movie content and lower purchases due to fewer kiosks that combined with the revenue impacts discussed above increased gross margin 0.1% to 57.2% for 2015; and

◦ $52.4 million decrease in other direct operating expenses primarily due to lower contractual fees paid to our retail partners due to the lower revenue, lower credit card fees driven by the lower volume of rentals, lower wireless network charges tied to data usage under new contracts starting in January 2015, and lower costs due to cost containment initiatives related to our field service operations and third party fees for customer service.

• $30.3 million decrease in depreciation and amortization expenses primarily due to an increase in our fully depreciated asset base partially offset by higher depreciation expense as a result of continued investment in our corporate technology infrastructure and additional depreciation for newly installed or replaced kiosks; and

32

• $6.5 million decrease in general and administrative expenses primarily as a result of ongoing cost reduction initiatives and lower variable expenses associated with IT infrastructure costs including temporary staffing and lower data facilities costs.

Comparing 2014 to 2013

Revenue decreased $86.0 million, or 4.4%, primarily due to the following:

• $95.5 million decrease from a 4.9% decrease in same store sales primarily due to:

◦ Relative attractiveness and timing of title releases - while total box office for content released during 2014 increased 8.1%, significantly lower box office during certain periods of 2014 (particularly in the second and third quarters) led to a lack of strong content throughout the year which, combined with the impact from the expected secular decline in the market, contributed to a 7.2% decrease in rentals in 2014;

◦ Revenue from video game rentals decreased $17.1 million primarily due to a lighter release slate during the first and second quarters because of the game industry’s shift to next generation platforms and under performance of certain games titles; partially offset by

◦ More effective promotional activity that leverages customer-specific offerings and an increase in the daily rental fees for movie content implemented in December 2014.

• $2.8 million decrease to zero from revenue earned by kiosks acquired from NCR as noted above; partially offset by

• $12.2 million increase in revenue from newly installed or relocated kiosks including those that replaced the remaining NCR kiosks.

Net revenue per rental increased $0.08 to $2.62 primarily due to:

• A continued increase in Blu-ray rentals which we consider a key focus for future revenue growth as it has a higher revenue and margin dollar per rental and offers consumers a better viewing experience due to superior picture and sound quality compared to other options such as digital streaming and video on demand. Blu-ray rentals represented 14.9% of total disc rentals and 17.6% of revenue during 2014 as compared to 13.1% of total disc rentals and 15.4% of revenue during 2013; partially offset by

• Lower video game rentals, which declined 16.6% during 2014 as compared to 2013 primarily due to the factors discussed above.

Operating income decreased $0.2 million, primarily due to the following:

• $86.0 million decrease in revenue as described above; partially offset by

• $46.9 million decrease in direct operating expenses, which were 70.1% of revenue in 2014 as compared to 69.4% in 2013, primarily as a result of:

◦ Product costs decreased $9.6 million to $806.8 million primarily due to lower spending on content in 2014 partially offset by a change in how we amortize our product costs in our content library that was prospectively applied as explained in Note 2: Summary of Significant Accounting Policies in our Notes to Consolidated Financial Statements resulting in a $21.7 million benefit which was recorded in the second quarter of 2013 to reflect an increase in the ending value of the Redbox content library as of June 30, 2013. For comparability purposes, product cost in 2013 would have been $23.8 million higher had the new methodology been applied retrospectively as costs would have shifted from prior periods into 2013;

◦ Gross margin decreased by 140 basis points to 57.1% in 2014 primarily due to the performance of the content library as a result of the relative attractiveness of titles available for rent and the timing of the release schedule in 2014 partially offset by a $3.4 million decrease in studio-related share-based expenses and closing underperforming NCR kiosks. The 2013 period also benefited from an $11.4 million reduction in a loss contingency that had been previously expensed in 2012;

◦ Direct operating expenses were also impacted by lower retailer revenue sharing expenses primarily due to lower revenue, lower payment card processing fees due to fewer rentals and general cost containment initiatives. The 2014 period also included a one-time benefit from a $5.6 million adjustment to expenses related to personal property taxes due to a reduction of the estimated liability; and

33

• $25.3 million decrease in general and administrative expenses primarily as a result of ongoing cost reduction initiatives, including payroll related savings arising from our December 2013 workforce reduction and lower variable expenses associated with IT infrastructure costs, temporary staffing, legal and professional fees; and

• $10.6 million decrease in depreciation and amortization expenses primarily due to certain of our kiosk assets that are depreciated over three to five years becoming fully depreciated partially offset by higher depreciation expense as a result of continued investment in our corporate technology infrastructure and additional depreciation for newly installed or replaced kiosks.

Coinstar

	Years Ended December 31,									2015 vs. 2014					2014 vs. 2013
Dollars in thousands, except average transaction size	2015			2014			2013			$			%		$			%
Revenue	$	318,611		$	315,628		$	300,218		$	2,983		0.9	%	$	15,410		5.1	%
Expenses:
Direct operating	159,211			161,214			158,562			(2,003		)	(1.2	)%	2,652			1.7	%
Marketing	5,566			6,346			6,244			(780		)	(12.3	)%	102			1.6	%
Research and development	—			531			6,962			(531		)	(100.0	)%	(6,431		)	(92.4	)%
General and administrative	31,561			26,989			25,220			4,572			16.9	%	1,769			7.0	%
Restructuring and related costs (Note 11)	2,076			23			724			2,053			NM*		(701		)	(96.8	)%
Segment operating income	120,197			120,525			102,506			(328		)	(0.3	)%	18,019			17.6	%
Less: depreciation and amortization	(31,871		)	(35,471		)	(33,921		)	3,600			(10.1	)%	(1,550		)	4.6	%
Operating income	$	88,326		$	85,054		$	68,585		$	3,272		3.8	%	$	16,469		24.0	%
Operating income as a percentage of revenue	27.7		%	26.9		%	22.8		%
Same store sales growth	2.9		%	4.7		%	1.4		%
Ending number of kiosks	20,930			21,340			20,900			(410		)	(1.9	)%	440			2.1	%
Total transactions (in thousands)	70,760			72,957			76,120			(2,197		)	(3.0	)%	(3,163		)	(4.2	)%
Average transaction size	$	43.78		$	42.12		$	41.39		$	1.66		3.9	%	$	0.73		1.8	%

* Not meaningful

Comparing 2015 to 2014

Revenue increased$3.0 million, or 0.9%, primarily due to an increase in the number of Coinstar Exchange kiosks and transactions. Coinstar revenue in the United Kingdom. and Canada was negatively impacted by unfavorable exchange rates due to the strengthening of the U.S. dollar versus the British pound and Canadian dollar compared to the prior year. The impact of the increased coin voucher product transaction fee from 8.9% to 9.9% implemented in the United Kingdom in August 2014 was primarily offset by the unfavorable exchange rate. Overall our same store sales growth was 2.9% as a result of these factors.

The average Coinstar transaction size increased while the number of transactions declined, reflecting larger pours and less frequent visits and a slight decrease in the U.S. kiosk base as a result of continued optimization efforts.

Operating income increased$3.3 million, or 3.8%, primarily due to the following:

• $3.6 million decrease in depreciation and amortization expenses primarily due to an increase in our fully depreciated asset base and intangible assets related to customer contracts being fully amortized in August 2014;

• $3.0 million increase in revenue as described above;

• $2.0 million decrease in direct operating expenses due to lower wireless charges tied to data usage under new contracts in 2015, lower vehicle fleet expenses including fuel cost savings from reduced gas prices and a reduction in selling and customer service costs, partially offset by increased revenue sharing costs from the higher revenue discussed above;

• $0.8 million decrease in marketing expenses due to overall lower spend in 2015; and

• $0.5 million reduction in research and development expenses; partially offset by

• $4.6 million increase in general and administrative expenses primarily due to an increase in technology costs and costs to support Coinstar Exchange growth, partially offset by lower costs as a result of ongoing cost containment initiatives; and

34

• $2.1 million increase in restructuring expenses related to the subleasing of certain corporate facilities, a one-time payment to settle an outstanding purchase commitment and severance expense from our ongoing cost containment initiatives.

Comparing 2014 to 2013

Effective August 1, 2014, we increased the coin voucher product transaction fee from 8.9% to 9.9% at all U.K. grocery retail locations.

Revenue increased $15.4 million, or 5.1%, primarily due to:

• Same store sales growth in the United States driven by a price increase implemented across all grocery locations effective October 1, 2013;

• Higher volume in the United Kingdom due to an increased U.K. kiosk base;

• Same store sales growth in the United Kingdom driven by a price increase on August 1, 2014; and

• Growth in the number of Coinstar Exchange kiosks.

The average transaction size continued to increase during 2014 while the number of transactions declined. The decline in transactions was the result of larger pours and less frequent visits, a slight decrease in the U.S. kiosk base year over year as a result of optimization efforts, the expected volume decline as a result of the U.S. price increase, and the impact of the Royal Canadian Mint’s penny reclamation efforts in Canada.

Operating income increased $16.5 million, or 24.0%, primarily due to the following:

• $15.4 million increase in revenue as described above; and

• $6.4 million decrease in research and development expenses primarily due to a reduction in kiosk hardware and software engineering efforts for Coinstar and Coinstar Exchange; partially offset by

• $2.7 million increase in direct operating expenses due to increased revenue sharing, selling and customer service costs to support higher revenues;

• $1.8 million increase in general and administrative expenses primarily due to increased expenses associated with the growth of our Coinstar Exchange business; and

• $1.6 million increase in depreciation and amortization expense due to higher depreciation expense as a result of continued investment in our corporate technology infrastructure and the write-off of technology assets.

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ecoATM

	Years Ended December 31,									2015 vs. 2014					2014 vs. 2013
Dollars in thousands, except average selling price of value devices sold	2015			2014			2013			$			%			$			%
Revenue	$	113,558		$	94,187		$	31,824		$	19,371		20.6	%		$	62,363		196.0	%
Expenses:
Direct operating	113,141			92,182			27,271			20,959			22.7	%		64,911			238.0	%
Marketing	8,481			3,513			938			4,968			141.4	%		2,575			274.5	%
Research and development	5,545			5,691			2,772			(146		)	(2.6	)%		2,919			105.3	%
General and administrative	10,875			12,773			7,868			(1,898		)	(14.9	)%		4,905			62.3	%
Restructuring and related costs (Note 11)	687			—			—			687			NM*			—			—	%
Goodwill impairment (Note 6)	85,890			—			—			85,890			NM*			—			—	%
Segment operating loss	(111,061		)	(19,972		)	(7,025		)	(91,089		)	456.1	%		(12,947		)	184.3	%
Less: depreciation and amortization	(26,382		)	(17,031		)	(6,077		)	(9,351		)	54.9	%		(10,954		)	180.3	%
Operating loss	$	(137,443	)	$	(37,003	)	$	(13,102	)	$	(100,440	)	271.4	%		$	(23,901	)	182.4	%
Ending number of kiosks	2,250			1,890			880			360			19.0	%		1,010			114.8	%
Average selling price of value devices sold	$	60.55		$	76.30		$	66.11		$	(15.75	)	(20.6	)%		$	10.19		15.4	%
Number of value devices sold	1,857,535			1,195,028			444,230			662,507			55.4	%		750,798			169.0	%
Number of overall devices sold	2,755,919			1,696,565			630,809			1,059,354			62.4	%		1,065,756			169.0	%

* Not meaningful

On November 10, 2015, we acquired certain assets and liabilities of Gazelle. The primary reasons for the business combination were to help drive our ecoATM business to profitability, provide margin and revenue uplift opportunities, and leverage a direct-to-consumer channel for collected devices. Gazelle results of operations are included in ecoATM from the November 10, 2015 acquisition date and include revenue of $13.3 million and operating loss of $0.9 million. See Note 3: Business Combinationsin our Notes to Consolidated Financial Statement for additional information.

On July 23, 2013 we completed the acquisition of ecoATM. The primary reason for the business combination was to expand Outerwall’s presence in automated retail and gain exposure to the growing demand for refurbished electronic products and mobile devices. ecoATM results of operations presented here represent the results of ecoATM from the July 23, 2013 acquisition date.

2015 Events

• During the second quarter of 2015, we recognized a goodwill impairment charge of $85.9 million related to ecoATM. The goodwill was originally recognized as part of our acquisition of ecoATM in 2013. During the three months ended June 30, 2015, it became evident that revenue and profitability trends in our ecoATM reporting unit were not being achieved as expected. For example collection rates, revenue and profitability on a per kiosk basis experienced declines versus prior periods and expected seasonal trends. As a result, we revised our internal expectations for future revenue growth and profitability lower than our previous estimates. This is primarily driven by certain challenges in an increasingly competitive industry which impact the per kiosk device collection, revenue and profitability expectations and the timing and installation of kiosks. Further, while these competitive challenges grew more acute during the second quarter, we also experienced the loss of a key executive at ecoATM. See Note 6: Goodwill and Other Intangible Assets in our Notes to Consolidated Financial Statements for additional information.

• During the first quarter of 2015, we added ecoATM as a separate reportable segment. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts, previously included in our New Ventures segment, are included in our All Other reporting category as they do not meet quantitative thresholds to be reported as a separate segment. All goodwill previously allocated to the New Ventures segment has been allocated to the ecoATM segment.

36

Comparing 2015 to 2014

Our key revenue drivers are the total devices collected, the number of those devices that are value devices, the mix of those value devices, as well as the average selling price that we receive when reselling the devices.

Revenue increased $19.4 million, or 20.6%, primarily due to the following:

• $13.3 million of revenue from Gazelle included in 2015 since the November 10, 2015 acquisition date; and

• The number of overall devices sold increased 62.4% and the number of value devices sold increased 55.4% primarily due to increased kiosk collections, driven by an increase in the number of ecoATM installed kiosks and 2015 benefiting from having a full year of collections for kiosks installed throughout 2014. Devices sold also increased to a lesser extent due to the results of Gazelle being included since acquisition. Also, as a result of our optimization efforts during 2015, we removed approximately 360 underperforming ecoATM kiosks, primarily from the grocery channel, and redeployed approximately 320 kiosks into retailer locations, with the majority in the mall and mass merchant channels. We are continuing to evaluate the grocery channel where kiosks have ramped at a slower rate and have lower collections than mass merchant and mall channels. This was partially offset by;

• $15.75 lower average selling price of value devices primarily due to a lower mix of higher value devices and lower collections of value devices per kiosk compared to the prior year primarily due to sustained carrier marketing of alternative trade-in options.

Operating loss increased $100.4 million primarily due to the $85.9 million goodwill impairment charge recognized in 2015 and the following;

• $21.0 million increase in direct operating expenses mainly due to costs associated with our increased installed ecoATM kiosk base, including the acquisition, transportation and processing of electronic devices, servicing of kiosks and payments to retailers and the results of Gazelle being included since acquisition;

• $9.4 million increase in depreciation and amortization expense primarily from depreciation on our increased installed ecoATM kiosk base; and

• $5.0 million increase in marketing costs primarily due to costs to promote the ecoATM brand and raise awareness to the consumer combined with additional headcount to support our installed ecoATM kiosk base and increased direct-to-consumer marketing costs of Gazelle since acquisition; partially offset by

• $19.4 million increase in revenue described above; and

• $1.9 million decrease in general and administrative expense primarily from a reduction in headcount, lower data facilities costs, and lower temp staffing as a result of an overall reduction in organization costs.

Comparing 2014 to 2013

Revenue increased $62.4 million primarily due to the inclusion of a full year of ecoATM results in 2014 and from kiosks installed primarily in the grocery channel during the second half of 2014. Relative to our mall and mass merchant channels, sites in the grocery channel typically are smaller in overall square footage and have less foot traffic. As a result, we expect our ecoATM kiosks in the grocery channel to ramp slower than our mall and mass merchant kiosks. Our key revenue drivers are devices collected per kiosk per day, the percentage of those devices that are value devices, as well as the average selling price that we receive when reselling the devices. Revenue decreased sequentially from the quarter ended September 30, 2014 primarily due to seasonal trends, a lower mix of higher value devices, and a lower average selling price in the secondary market resulting from an increased supply of devices following the iPhone 6 release in September 2014.

Operating loss increased $23.9 million, or 182.4%, primarily due to the following;

• $64.9 million increase in direct operating expenses mainly due to costs associated with the acquisition, transportation and processing of mobile devices, as well as costs for servicing of our kiosks and payments to our retailers. Additionally, in 2014 the highly successful launch of the iPhone 6/6+ caused a significant increase in device trade-ins that lowered resale values in the secondary market to below historical levels during the fourth quarter. 2014 operating expenses also included a full year of results whereas 2013 included costs only after the acquisition date and reflected the increased ecoATM kiosk base. As we install additional kiosks we expect our variable operating costs to increase proportionately, however, as our existing kiosks continue to ramp, we expect to leverage the fixed cost portions of our direct operating expenses;

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• $11.0 million increase in depreciation and amortization expense from depreciation on our increased installed kiosk base, amortization expense related to certain intangible assets acquired as part of the business combination and higher depreciation expense as a result of continued investment in our corporate technology infrastructure;

• $4.9 million increase in general and administrative expense primarily due to higher costs to support the continued growth in our installed kiosk base, as well as expenses related to facilities expansion and human resource programs, partially offset by $5.7 million in transaction expenses related to the acquisition of ecoATM in 2013;

• $2.9 million increase in research and development expense due to continued development of our kiosk hardware and software platforms; and

• $2.6 million increase in marketing costs primarily due to costs to promote the ecoATM brand and additional headcount to support our installed kiosk base; partially offset by

• $62.4 million increase in revenue described above.

Income (loss) from equity method investments

Comparing 2015 to 2014

Loss from our equity method investments was $0.8 million compared to $28.7 million during the same period of 2014. The decrease in equity method losses was primarily a result of our withdrawal from Redbox Instant by Verizon on October 20, 2014.

Comparing 2014 to 2013

Loss and income from equity method investments was $28.7 million of loss compared to income of $19.9 million primarily due to:

• $68.4 million gain in 2013 resulting from the re-measurement of our previously held equity interest in ecoATM during 2013; partially offset by

• $19.7 million in lower losses from our investment in the Joint Venture and other equity method investments.

Additional financial information about our equity method investments is provided inNote 7: Equity Method Investments in our Notes to Consolidated Financial Statements.

Interest Expense, Net

Dollars in thousands	Years Ended December 31,									2015 vs. 2014					2014 vs. 2013
	2015			2014			2013			$			%		$			%
Cash interest expense	$	45,507		$	41,562		$	25,289		$	3,945		9.5	%	$	16,273		64.3	%
Non-cash interest expense:
Amortization of debt discount	1,731			2,606			4,674			(875		)	(33.6	)%	(2,068		)	(44.2	)%
Amortization of deferred financing fees	1,030			1,510			1,720			(480		)	(31.8	)%	(210		)	(12.2	)%
Other	—			—			(550		)	—			—	%	550			(100.0	)%
Total non-cash interest expense	2,761			4,116			5,844			(1,355		)	(32.9	)%	(1,728		)	(29.6	)%
Total cash and non-cash interest expense	48,268			45,678			31,133			2,590			5.7	%	14,545			46.7	%
(Gain) loss from early extinguishment of debt	(5,854		)	2,018			6,013			(7,872		)	(390.1	)%	(3,995		)	(66.4	)%
Total interest expense	42,414			47,696			37,146			(5,282		)	(11.1	)%	10,550			28.4	%
Interest income	(61		)	(52		)	(4,339		)	(9		)	17.3	%	4,287			(98.8	)%
Interest expense, net	$	42,353		$	47,644		$	32,807		$	(5,291	)	(11.1	)%	$	14,837		45.2	%

Comparing 2015 to 2014

Interest expense, net decreased $5.3 million, or 11.1%, primarily due to:

• $7.9 million decrease in (gain) loss from early extinguishment of debt as we recognized a gain of $5.9 million in 2015 compared to a loss of $2.0 million in 2014. See Note 8: Debt and Other Long-Term Liabilitiesin our Notes to Consolidated Financial Statements for more information; partially offset by

• $2.6 million higher interest expense due to a shift in the composition of our debt to higher fixed rate debt, partially offset by lower borrowings.

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Comparing 2014 to 2013

Interest expense, net increased $14.8 million, or 45.2%, primarily due to:

• $14.5 million higher interest expense from increased average borrowings which includes the impact of the $300.0 million principal amount of our 2021 Notes that we issued on June 9, 2014. See Note 8: Debt and Other Long-Term Liabilitiesin our Notes to Consolidated Financial Statements for more information; and

• $4.3 million decrease in interest income primarily due to income from the settlement of a note receivable in 2013; partially offset by

• $4.0 million decrease in losses from the early extinguishment or conversion of debt. See Note 8: Debt and Other Long-Term Liabilitiesin our Notes to Consolidated Financial Statements for more information.

Other, Net

Dollars in thousands	Years Ended December 31,									2015 vs. 2014					2014 vs. 2013
	2015			2014			2013			$			%		$		%
Other, net	$	(2,657	)	$	(1,185	)	$	(3,599	)	$	(1,472	)	124.2	%	$	2,414	(67.1	)%

Comparing 2015 to 2014

Other, net decreased by $1.5 million, primarily due to higher foreign currency losses due to the impact of the Canadian dollar exchange rates on our Coinstar operations, partially offset by a $1.0 million gain on the purchase of Gazelle recognized in 2015. See Note 3: Business Combinations in our Notes to Consolidated Financial Statements for more information on the gain on the purchase of Gazelle.

Comparing 2014 to 2013

Other, net decreased by $2.4 million or 67.1% primarily due to:

• $2.8 million in expense incurred to write-down the carrying value of a note receivable from Sigue incurred during 2013 which did not recur in 2014; partially offset by

• $1.3 million higher foreign currency related losses to $2.7 million primarily due to the impact of the Canadian dollar exchange rates on our Coinstar Canada operations.

Income Tax Expense

Dollars in thousands	Year Ended December 31,									2015 vs 2014			2014 vs 2013
	2015			2014			2013
Income tax expense	$	(73,619	)	$	(66,164	)	$	(39,710	)	$	(7,455	)	$	(26,454	)
Effective tax rate	59.8		%	34.7		%	15.1		%	25.1 pts			19.6 pts

Income tax expense and effective tax rates are driven by recurring items, such as tax rates in foreign jurisdictions and the relative amount of income we earn in each. It is also affected by permanent differences in the recognition of income and expenses for income tax purposes compared to financial reporting purposes and various discrete items that may occur in any given year, but are not consistent from year to year. The most significant, recurring permanent difference impacting our income tax expense is the domestic production activities deduction. See Note 18: Income Taxes From Continuing Operationsin our Notes to Consolidated Financial Statements for more information.

Comparing 2015 to 2014

Income tax expense increased by $7.5 million primarily driven by:

• $6.9 million increase in tax expense primarily driven by an increase of $18.2 million in income from continuing operations before income taxes excluding the $85.9 million non-tax deductible impairment of goodwill; and

• $3.8 million in tax benefits related to discrete items occurring in 2014, mainly composed of:

◦ $2.1 million related to the true-up of recognition of a worthless stock deduction from an outside basis difference in a corporate subsidiary in 2013; and

◦ $1.7 million related to other miscellaneous items; partially offset by

• $3.2 million decrease in tax expense related to a net reduced benefit from permanent items.

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Comparing 2014 to 2013

Income tax expense increased by $26.5 million resulting from higher taxable income primarily driven by:

• $34.5 million in tax benefits related to discrete items occurring in 2013 composed of:

◦ $16.7 million related to the recognition of a worthless stock deduction from an outside basis difference in a corporate subsidiary in 2013; and

◦ $17.8 million, net of a valuation allowance, through the realization of capital and ordinary gains and losses associated with the series of transactions to reorganize Redbox related subsidiary structures through the sale of a wholly owned subsidiary; partially offset by

• $5.3 million increase in the domestic production activities deduction from $1.5 million in 2013 to $6.8 million in 2014; and

• $2.7 million in additional impact primarily driven by various permanent and discrete items as well as the $3.2 million decrease in Income from continuing operations before income taxes excluding the $68.4 million non-taxable gain on previously held equity interest in ecoATM.

Non-GAAP Financial Measures

Non-GAAP measures may be provided as a complement to results provided in accordance with United States generally accepted accounting principles (“GAAP”).

We use the following non-GAAP financial measures to evaluate our financial results:

• Core adjusted EBITDA from continuing operations;

• Core diluted earnings per share (“EPS”) from continuing operations;

• Free cash flow; and

• Net debt and net leverage ratio.

These measures, the definitions of which are presented below, are non-GAAP because they exclude certain amounts which are included in the most directly comparable measure calculated and presented in accordance with GAAP. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for our GAAP financial measures and may not be comparable with similarly titled measures of other companies.

Core and Non-Core Results

We distinguish our core activities, those associated with our primary operations which we directly control, from non-core activities. Non-core activities may include nonrecurring events or events we do not directly control. Our non-core adjustments for the periods presented include i) goodwill impairment, ii) restructuring costs (including severance and contract termination costs, that include early lease terminations and the related asset impairments) associated with actions to reduce costs in our continuing operations across the Company, iii) acquisition costs related to the acquisitions of Gazelle and ecoATM, iv) compensation expense for rights to receive cash issued in conjunction with our acquisition of ecoATM and attributable to post-combination services as they are fixed amount acquisition related awards and not indicative of the directly controllable future business results, v) loss from equity method investments, which represents our share of income or loss from entities we do not consolidate or control and includes the impacts of the gain on re-measurement of our previously held equity interest in ecoATM upon acquisition, vi) gain on bargain purchase of Gazelle, vii) benefits from release of indemnification reserves upon settlement of the Sigue Note, viii) tax benefits related to a net operating loss adjustment and a worthless stock deduction ("Non-Core Adjustments").

We believe investors should consider our core results because they are more indicative of our ongoing performance and trends, are more consistent with how management evaluates our operational results and trends, provide meaningful supplemental information to investors through the exclusion of certain expenses which are either nonrecurring or may not be indicative of our directly controllable business operating results, allow for greater transparency in assessing our performance, help investors better analyze the results of our business and assist in forecasting future periods.

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Core Adjusted EBITDA from continuing operations

Our non-GAAP financial measure core adjusted EBITDA from continuing operations is defined as earnings from continuing operations before depreciation, amortization and other; interest expense, net; income taxes; share-based payments expense; and Non-Core Adjustments.

A reconciliation of core adjusted EBITDA from continuing operations to net income from continuing operations, the most comparable GAAP financial measure, is presented in the following table:

	Year Ended December 31,								2015 vs. 2014					2014 vs. 2013
Dollars in thousands	2015			2014		2013			$			%		$			%
Net income from continuing operations	$	49,446		$	124,677	$	222,688		$	(75,231	)	(60.3	)%	$	(98,011	)	(44.0	)%
Depreciation, amortization and other	184,940			202,478		200,308			(17,538		)	(8.7	)%	2,170			1.1	%
Interest expense, net	42,353			47,644		32,807			(5,291		)	(11.1	)%	14,837			45.2	%
Income taxes expense	73,619			66,164		39,710			7,455			11.3	%	26,454			66.6	%
Share-based payments expense(1)	17,377			13,384		16,831			3,993			29.8	%	(3,447		)	(20.5	)%
Adjusted EBITDA from continuing operations	367,735			454,347		512,344			(86,612		)	(19.1	)%	(57,997		)	(11.3	)%
Non-Core Adjustments:
Goodwill impairment	85,890			—		—			85,890			NM*		—			—	%
Restructuring and related costs	27,153			469		4,495			26,684			NM*		(4,026		)	(89.6	)%
Acquisition costs	342			—		5,669			342			NM*		(5,669		)	(100.0	)%
Rights to receive cash issued in connection with the acquisition of ecoATM	4,354			13,270		8,664			(8,916		)	(67.2	)%	4,606			53.2	%
Loss from equity method investments, net	800			28,734		48,448			(27,934		)	(97.2	)%	(19,714		)	(40.7	)%
Gain on purchase of Gazelle	(989		)	—		—			(989		)	NM*		—			—	%
Sigue indemnification reserve releases	—			—		(2,542		)	—			—	%	2,542			(100.0	)%
Gain on previously held equity interest in ecoATM	—			—		(68,376		)	—			—	%	68,376			(100.0	)%
Core adjusted EBITDA from continuing operations	$	485,285		$	496,820	$	508,702		$	(11,535	)	(2.3	)%	$	(11,882	)	(2.3	)%

 * Not Meaningful

(1)    Includes both non-cash share-based compensation for executives, non-employee directors and employees as well as share-based payments for content arrangements.

Comparing 2015 to 2014

The decrease in our core adjusted EBITDA from continuing operations was primarily due to lower segment operating income in our Redbox and ecoATM segments. The other significant components of core adjusted EBITDA from continuing operations have been discussed previously in the Results of Operations section above.

Comparing 2014 to 2013

The decrease in our core adjusted EBITDA from continuing operations was primarily due to:

• Lower segment operating income in our Redbox segment, and

• Higher segment operating loss in our ecoATM segment, partially offset by

• Higher segment operating income in our Coinstar segment.

The other significant components of core adjusted EBITDA from continuing operations have been discussed previously in the Results of Operations section above.

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Core Diluted EPS from continuing operations

Our non-GAAP financial measure core diluted EPS from continuing operations is defined as diluted earnings per share from continuing operations utilizing the treasury stock method excluding non-core adjustments, net of applicable taxes.

A reconciliation of core diluted EPS from continuing operations to diluted EPS from continuing operations, the most comparable GAAP financial measure, is presented in the following table:

	Year Ended December 31,									2015 vs. 2014					2014 vs. 2013
	2015			2014			2013			$			%		$			%
Diluted EPS from continuing operations per common share (two-class method)	$	2.75		$	5.89		$	7.72		$	(3.14	)	(53.3	)%	$	(1.83	)	(23.7	)%
Adjustment from participating securities allocation and share differential to treasury stock method(1)	0.05			0.13			0.13			(0.08		)	(61.5	)%	—			—	%
Diluted EPS from continuing operations (treasury stock method)	2.80			6.02			7.85			(3.22		)	(53.5	)%	(1.83		)	(23.3	)%
Non-Core Adjustments, net of tax:(1)
Goodwill impairment	4.87			—			—			4.87			NM*		—			—	%
Restructuring and related costs	0.94			0.01			0.10			0.93			NM*		(0.09		)	(90.0	)%
Acquisition costs	0.01			—			0.17			0.01			NM*		(0.17		)	(100.0	)%
Rights to receive cash issued in connection with the acquisition of ecoATM	0.17			0.53			0.25			(0.36		)	(67.9	)%	0.28			112.0	%
Loss from equity method investments	0.03			0.85			1.04			(0.82		)	(96.5	)%	(0.19		)	(18.3	)%
Gain on purchase of Gazelle	(0.05		)	—			—			(0.05		)	NM*		—			—	%
Sigue indemnification reserve releases	—			—			(0.05		)	—			—	%	0.05			(100.0	)%
Gain on previously held equity interest on ecoATM	—			—			(2.33		)	—			—	%	2.33			(100.0	)%
Tax benefits from net operating loss adjustment and worthless stock deduction	—			(0.15		)	(0.59		)	0.15			(100.0	)%	0.44			(74.6	)%
Core diluted EPS from continuing operations	$	8.77		$	7.26		$	6.44		$	1.51		20.8	%	$	0.82		12.7	%

 * Not Meaningful

(1)    Non-Core Adjustments are presented after-tax using the applicable effective tax rate for the respective periods.

A reconciliation of amounts used in calculating core diluted EPS from continuing operations in the table above is presented in the following table:

	Year Ended December 31,
In thousands	2015		2014		2013
Income from continuing operations attributable to common shares	$	48,117	$	120,748	$	217,215
Add: income from continuing operations allocated to participating securities	1,329		3,929		5,473
Income from continuing operations	$	49,446	$	124,677	$	222,688
Weighted average diluted common shares	17,487		20,503		28,169
Add: diluted common equivalent shares of participating securities	155		196		212
Weighted average diluted shares (treasury stock method)	17,642		20,699		28,381

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Free Cash Flow

Our non-GAAP financial measure free cash flow is defined as net cash provided by operating activities after capital expenditures. We believe free cash flow is an important non-GAAP measure as it provides additional information to users of the financial statements regarding our ability to service, incur or pay down indebtedness and repurchase our securities. A reconciliation of free cash flow to net cash provided by operating activities, the most comparable GAAP financial measure, is presented in the following table:

	Years ended December 31,									2015 vs. 2014					2014 vs. 2013
Dollars in thousands	2015			2014			2013			$			%		$		%
Net cash provided by operating activities	$	326,085		$	338,351		$	327,834		$	(12,266	)	(3.6	)%	$	10,517	3.2	%
Purchase of property and equipment	(77,591		)	(97,924		)	(161,412		)	20,333			(20.8	)%	63,488		(39.3	)%
Free cash flow	$	248,494		$	240,427		$	166,422		$	8,067		3.4	%	$	74,005	44.5	%

An analysis of our net cash from operating activities and used in investing and financing activities is provided below in the Liquidity and Capital Resources section.

Net Debt and Net Leverage Ratio

Our non-GAAP financial measure net debt is defined as the total face value of outstanding debt, including capital leases, less cash and cash equivalents held in financial institutions domestically. Our non-GAAP financial measure net leverage ratio is defined as net debt divided by core adjusted EBITDA from continuing operations for the last twelve months (LTM). We believe net debt and net leverage ratio are important non-GAAP measures because they:

• are used to assess the degree of leverage by management;

• provide additional information to users of the financial statements regarding our ability to service, incur or pay down indebtedness and repurchase our securities as well as additional information about our capital structure; and

• are reported quarterly to support covenant compliance under our credit agreement.

A reconciliation of net debt to total outstanding debt including capital leases, the most comparable GAAP financial measure, is presented in the following table:

	December 31,						Change
Dollars in thousands	2015			2014			$			%
Senior unsecured notes(1)	$	608,908		$	650,000		$	(41,092	)	(6.3	)%
Term loans(1)	136,875			146,250			(9,375		)	(6.4	)%
Revolving line of credit	140,500			160,000			(19,500		)	(12.2	)%
Capital leases	5,889			15,391			(9,502		)	(61.7	)%
Total principal value of outstanding debt including capital leases	892,172			971,641			(79,469		)	(8.2	)%
Less domestic cash and cash equivalents held in financial institutions	(46,192		)	(66,546		)	20,354			(30.6	)%
Net debt	845,980			905,095			(59,115		)	(6.5	)%
LTM Core adjusted EBITDA from continuing operations	$	485,285		$	496,820		$	(11,535	)	(2.3	)%
Net leverage ratio	1.74			1.82

(1) See debt section of Liquidity and Capital Resources below and Note 8: Debt and Other Long-Term Liabilities in our Notes to Consolidated Financial Statements for detail of associated debt discount.

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Liquidity and Capital Resources

We believe our existing cash, cash equivalents and amounts available to us under our Credit Facility will be sufficient to fund our cash requirements and capital expenditure needs for at least the next 12 months. After that time, the extent of additional financing needed, if any, will depend on the success of our business. If we significantly increase kiosk installations beyond planned levels or if our Redbox, Coinstar or ecoATM kiosks generate lower than anticipated revenue or operating results, then our cash needs may increase. Furthermore, our future capital requirements will depend on a number of factors, including consumer use of our products and services, the timing and number of machine installations, the number of available installable kiosks, the type and scope of product and service enhancements, the cost of developing potential new product and service offerings, and enhancements, and cash required to fund potential future acquisitions, investment or capital returns to security holders such as through share or debt repurchases.

The following is an analysis of our year-to-date cash flows:

Net Cash from Operating Activities

Our net cash from operating activities decreased by $12.3 million primarily due to:

• $62.3 million decrease in net income; partially offset by

• $39.6 million change in net non-cash income and expense included in net income primarily due to changes in goodwill impairment, loss from equity method investments, depreciation and other, (gain) loss from early extinguishment of debt and gain on purchase of Gazelle; and

• $10.4 million decrease in net cash outflows from changes in working capital primarily due to changes in accounts payable, prepaid expenses and other current assets, content library, other accrued liabilities, and accrued payable to retailers.

Net Cash used in Investing Activities

We used $92.3 million of net cash in our investing activities primarily due to:

• $77.6 million for the purchases of property and equipment for kiosks and corporate infrastructure; and

• $18.0 million for the purchase of Gazelle; partially offset by

• $3.2 million for proceeds from the sale of property and equipment.

Net Cash used in Financing Activities

We used $256.7 million of net cash from financing activities primarily due to:

• $159.8 million for repurchases of our common stock;

• $34.6 million used to repurchase a portion of our 2021 Notes;

• $28.9 million in net payments for borrowings from our Credit Facility;

• $21.2 million for dividends paid; and

• $11.5 million to pay capital lease obligations and other debt.

Cash and Cash Equivalents

A portion of our business involves collecting and processing large volumes of cash, most of it in the form of coins. As of December 31, 2015, our cash and cash equivalent balance was $222.5 million, of which $83.3 million was identified for settling our payable to the retailer partners in relation to our Coinstar kiosks. The remaining balance of our cash and cash equivalents was available for use to support our liquidity needs.

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Debt

Debt comprises the following:

	Senior Notes						Credit Facility					Total Debt
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2015:
Principal	$	350,000		$	258,908		$	136,875		$	140,500	$	886,283
Discount	(3,275		)	(3,029		)	(260		)	—		(6,564		)
Total	346,725			255,879			136,615			140,500		879,719
Less: current portion	—			—			(13,125		)	—		(13,125		)
Total long-term portion	$	346,725		$	255,879		$	123,490		$	140,500	$	866,594

	Senior Notes						Credit Facility					Total Debt
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2014:
Principal	$	350,000		$	300,000		$	146,250		$	160,000	$	956,250
Discount	(4,296		)	(4,152		)	(335		)	—		(8,783		)
Total	345,704			295,848			145,915			160,000		947,467
Less: current portion	—			—			(9,390		)	—		(9,390		)
Total long-term portion	$	345,704		$	295,848		$	136,525		$	160,000	$	938,077

2019 Notes

On March 12, 2013, we and certain subsidiaries of ours, as subsidiary guarantors, entered into an indenture pursuant to which we issued $350.0 million principal amount of 6.000% 2019 Notes at par for proceeds, net of expenses, of $343.8 million. The expenses were allocated between debt discount and deferred financing fees based on their nature. As of December 31, 2015, we were in compliance with the covenants of the related indenture.

2021 Notes

On June 9, 2014, we and certain subsidiaries of ours, as subsidiary guarantors, entered into an indenture pursuant to which we issued $300.0 million principal amount of 5.875% 2021 Notes at par for proceeds, net of expenses, of $294.0 million. The expenses were allocated between debt discount and deferred financing fees based on their nature.

During the second quarter of 2015, we registered these notes and related guarantees under the Securities Act of 1933, as amended (the “Securities Act”) to allow holders to exchange the notes and related guarantees for the same principal amount of a new issue and related guarantees (collectively, the “Exchange Notes”) with substantially identical terms, except that the Exchange Notes are generally freely transferable under the Securities Act. The full principal amount of the notes was exchanged for the Exchange Notes.

On December 15, 2015, we repurchased 41,092 2021 Notes, or $41.1 million in face value of 2021 Notes, for $34.6 million in cash. The gain from early extinguishment of these 2021 Notes was approximately $5.9 million and is included in interest expense, net on our Consolidated Statements of Comprehensive Income.

As of December 31, 2015, we were in compliance with the covenants of the related indenture.

Revolving Line of Credit and Term Loan

On June 24, 2014, we entered into the Third Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) providing for a senior secured credit facility (the "Credit Facility"). The Amended and Restated Credit Agreement amended and restated in its entirety the Second Amended and Restated Credit Agreement dated as of November 20, 2007 and amended and restated as of April 29, 2009 and as of July 15, 2011 and all amendments and restatements thereto. The credit facility provided under the previous credit agreement was replaced by the Credit Facility.

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The Credit Facility consists of (a) a $150.0 million amortizing term loan (the “Term Loan”) and (b) a $600.0 millionrevolving line of credit (the “Revolving Line”), which includes (i) a $75.0 million sublimit for the issuance of letters of credit, (ii) a $50.0 million sublimit for swingline loans and (iii) a $75.0 million sublimit for loans in certain foreign currencies available to us and certain wholly owned Company foreign subsidiaries (the “Foreign Borrowers”). We may, subject to applicable conditions and subject to obtaining commitments from lenders, request an increase in the Revolving Line of up to$200.0 million in aggregate (the “Accordion”).

We (or the Foreign Borrowers, if applicable), subject to applicable conditions, may generally elect interest rates on the Term Loan and Revolving Line calculated by reference to (a) LIBOR (“London Interbank Offered Rate”) (or the Canadian Dealer Offered Rate, in the case of loans denominated in Canadian Dollars or, if LIBOR is not available for a foreign currency, such other interest rate customarily used by Bank of America for such foreign currency) for given interest periods (the “LIBOR/Eurocurrency Rate”) or (b) on loans in U.S. Dollars made to us, Bank of America’s prime rate (or, if greater, (i) the average rate on overnight federal funds plus 0.50% or (ii) the daily floating one month LIBOR plus 1%) (the “Base Rate”), plus a margin determined by our consolidated net leverage ratio. For swingline borrowings, we will pay interest at the Base Rate, plus a margin determined by our consolidated net leverage ratio. For borrowings made with the LIBOR/Eurocurrency Rate, the margin ranges from 125 to 200 basis points, while for borrowings made with the Base Rate, the margin ranges from 25 to 100 basis points.

The Amended and Restated Credit Agreement requires principal amortization payments under the Term Loan as follows:

Dollars in thousands	Repayment Amount
2016	$	13,125
2017	15,000
2018	18,750
2019	90,000
Total	$	136,875

The Revolving Line matures on June 24, 2019, at which time all outstanding borrowings must be repaid and all outstanding letters of credit must have been terminated or cash collateralized. The maturity date of the borrowings under the Credit Facility may be accelerated to December 18, 2018 if our senior unsecured notes due 2019 remain outstanding on or after such date. We may prepay amounts borrowed under the Term Loan without premium or penalty (other than breakage costs in the case of borrowings made with the LIBOR/Eurocurrency Rate), but amounts prepaid may not be re-borrowed.

The Amended and Restated Credit Agreement contains events of default that include, among others, non-payment of principal, interest or fees, violation of covenants, inaccuracy of representations and warranties, bankruptcy and insolvency events, material judgments, cross defaults to certain other indebtedness, and events constituting a change of control. The occurrence of an event of default will increase the applicable rate of interest and could result in the acceleration of our obligations under the Credit Facilities and the obligations of any or all of the Guarantors to pay the full amount of our (or any Foreign Borrower’s) obligations under the Credit Facility.

The Amended and Restated Credit Agreement contains certain loan covenants, including, among others, financial covenants providing for a maximum consolidated net leverage ratio (i.e., consolidated total debt (net of certain cash and cash equivalents held by us and our domestic subsidiaries) to consolidated EBITDA) and a minimum consolidated interest coverage ratio, and limitations on our ability with regard to the incurrence of debt, the existence of liens, capital expenditures, stock repurchases and dividends, investments, and mergers, dispositions and acquisitions. Our obligations under the Credit Facility are guaranteed by each of our direct and indirect U.S. subsidiaries (collectively, the “Guarantors”), and if any Foreign Borrower is added to the Credit Facility, the Foreign Borrower’s obligations will be guaranteed by us and each of the Guarantors. The interest rate on amounts outstanding under the Credit Facility was 2.29% and 1.92% as of December 31, 2015 and December 31, 2014, respectively and as of December 31, 2015, we were in compliance with the covenants of the Credit Facility.

Convertible Debt

On September 2, 2014, our 4.0% Convertible Senior Notes (the “Convertible Notes”) matured. The Convertible Notes were convertible as of December 31, 2013. In 2014, we retired or settled upon maturity, a combined 51,148 Convertible Notes for total consideration of $51.1 million in cash and the issuance of 431,760shares of common stock. The amount by which total consideration exceeded the fair value of the Convertible Notes has been recorded as a reduction of stockholders’ equity. The loss from early extinguishment of the Convertible Notes was approximately $0.3 million and is recorded in Interest expense, net in our Consolidated Statements of Comprehensive Income.

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Letters of Credit

As of December 31, 2015, we had five irrevocable standby letters of credit that totaled $6.5 million. These standby letters of credit, which expire at various times through November2016, are used to collateralize certain obligations to third parties. As of December 31, 2015, no amounts were outstanding under these standby letter of credit agreements.

Other Contingencies

During the year ended December 31, 2013, we resolved a previously disclosed loss contingency related to a supply agreement and recorded a benefit of $11.4 million in the direct operating line item in our Consolidated Statements of Comprehensive Income.

Contractual Payment Obligations

Dollars in thousands	Total		2016		2017 & 2018		2019 & 2020		2021 & Beyond
Long-term debt and other(1)	$	886,283	$	153,625	$	33,750	$	440,000	$	258,908
Contractual interest on long-term debt	151,939		36,216		72,433		35,682		7,608
Capital lease obligations(2)	6,221		4,144		1,440		514		123
Operating lease obligations, net(2)(3)	61,351		18,124		23,173		12,922		7,132
Purchase obligations(2)	24,450		19,601		4,849		—		—
Asset retirement obligations	9,412		—		—		—		9,412
Content agreement obligations(2)	448,718		381,275		67,443		—		—
Retailer revenue share obligations(2)	2,365		1,711		654		—		—
Total(4)	$	1,590,739	$	614,696	$	203,742	$	489,118	$	283,183

(1) See Note 8: Debt and Other Long-Term Liabilitiesin our Notes to Consolidated Financial Statements.

(2) See Note 16: Commitments and Contingencies in our Notes to Consolidated Financial Statements.

(3) Net of sublease income of $1.3 million. See Note 16: Commitments and Contingenciesin our Notes to Consolidated Financial Statements.

(4) Income tax liabilities for uncertain tax positions were excluded as we are not able to make a reasonably reliable estimate of the amount and period of related future payments. As of December 31, 2015, we had $6.9 million of gross unrecognized tax benefits for uncertain tax positions.

Off-Balance Sheet Arrangements

Other than certain contractual arrangements listed above, we do not have any off-balance sheet arrangements that have or are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. For additional information see Note 16: Commitments and Contingencies in our Notes to Consolidated Financial Statements.

Inflation

We believe that the impact of inflation was minimal on our business in 2015, 2014 and 2013.

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Critical Accounting Policies

Our consolidated financial statements have been prepared in accordance with U.S. GAAP. Preparation of these statements requires management to make judgments and estimates. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the present circumstances.

Significant estimates underlying our consolidated financial statements include the:

• useful lives and salvage values of our content library;

• determination of goodwill impairment;

• lives of equipment and other long-lived assets;

• recognition and measurement of current and long-term deferred income taxes (including the measurement of uncertain tax positions);

• recognition and measurement of purchase price allocation for business combinations; and

• loss contingencies.

It is reasonably possible that the estimates we make may change in the future and could have a material effect on our financial statements.

Content Library

Content library consists of movies and video games available for rent or purchase. We obtain our movie and video game content primarily through revenue sharing agreements and license agreements with studios and game publishers, as well as through distributors and other suppliers. The cost of content mainly includes the cost of the movies and video games, labor, overhead, freight, and studio revenue sharing expenses. The content purchases are capitalized and amortized to their estimated salvage value as a component of direct operating expenses over the usage period. For purchased content that we expect to sell at the end of its useful life, we determine an estimated salvage value. Content salvage values are estimated based on the amounts that we have historically recovered on disposal. For licensed content that we do not expect to sell, no salvage value is provided. The useful lives and salvage value of our content library are periodically reviewed and evaluated. Amortization charges are derived utilizing rental curves based on historical performance of movies and games over their useful lives and recorded on an accelerated basis, reflecting higher rentals of movies and video games in the first few weeks after release, and substantially all of the amortization expense is recognized within one year of purchase.

Goodwill

Goodwill represents the excess purchase price of an acquired enterprise or assets over the estimated fair value of identifiable net assets acquired. We assess goodwill for potential impairment at the reporting unit level on an annual basis as of November 30, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. We may assess qualitative factors to make this determination, or bypass such a qualitative assessment and proceed directly to testing goodwill for impairment using a two-step process. Qualitative factors we may consider include, but are not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments and entity specific factors such as strategies and financial performance. We also consider our current market capitalization as of the reporting date and for a period of time around the reporting date. If, after completing such assessment, it is determined more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a two-step impairment test, whereby the first step is comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the test is not performed. The second step of the impairment test is performed when the carrying amount of the reporting unit exceeds the fair value, then the implied fair value of the reporting unit goodwill is compared with the carrying amount of that goodwill. If the carrying amount of the reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to the excess.

During the three months ended June 30, 2015, it became evident that revenue and profitability trends in our ecoATM reporting unit were not being achieved as expected. For example collection rates, revenue and profitability on a per kiosk basis experienced declines versus prior periods and expected seasonal trends. As a result, we revised our internal expectations for future revenue growth and profitability lower than our previous estimates. This is primarily driven by certain challenges in an increasingly competitive industry which impact the per kiosk device collection, revenue and profitability expectations and the timing and installation of kiosks. Further, while these competitive challenges grew more acute during the second quarter of

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2015, we also experienced the loss of a key executive at ecoATM. This led to an indication in the second quarter of 2015 that ecoATM’s fair value was more likely than not below its carrying value.

As a result, we performed the first step of the goodwill impairment test with the assistance of a third-party valuation specialist. The first step of the impairment test was completed by comparing the carrying value of ecoATM, including goodwill, to its fair value determined using a weighted combination of a discounted cash flow (“DCF”) income based approach and a guideline public company market based approach. The DCF methodology requires significant judgment in selecting appropriate inputs including the risk adjusted market cost of capital for the discount rate, the terminal growth rate and projections of future cash flows, all of which are inherently uncertain. The guideline public company method involves significant judgment in selecting the appropriate inputs including the peer company group, the selection of relevant multiples and the determination of a reasonable control premium. Due to these significant judgments, the fair value determined in connection with the goodwill impairment test may not necessarily be indicative of the actual value that would be recognized in a future transaction. Completion of the first step of the impairment test determined that the carrying amount of ecoATM exceeded its fair value and that the second step of the impairment test needed to be performed.

Under the second step of the impairment test, we completed the process of estimating the fair value of ecoATM’s assets and liabilities, including intangible assets consisting of developed technology, trade name and covenants not to compete for the purpose of deriving an estimate of the implied fair value of goodwill. The estimate of the implied fair value of goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Significant assumptions used in measuring the value of these assets and liabilities included the discount rates and obsolescence rates used in valuing the intangible assets, and replacement costs for valuing the tangible assets.

Based on the result of the second step of the goodwill impairment analysis, we recognized a non-cash, non-tax deductible charge for goodwill impairment of $85.9 million related to our ecoATM business segment in the second quarter of 2015.

As a result of the impairment recorded, the estimated fair value of the ecoATM reporting unit equaled its carrying value as of June 30, 2015.

On November 10, 2015, we acquired certain assets and liabilities of Gazelle, which are included in our ecoATM reporting unit. The primary reasons for the business combination were to help drive our ecoATM business to profitability, provide margin and revenue uplift opportunities, and leverage a direct-to-consumer channel for collected devices. The expected increase in our estimated future cash flows from the Gazelle acquisition was used in estimating the ecoATM reporting unit fair value for our annual goodwill impairment test as of November 30, 2015.

The estimate of ecoATM's fair value includes key assumptions with inherent uncertainty which may change in future periods and have a negative effect on the fair value resulting in potential future impairments, the most significant of which is our estimate of future cash flows predicated on estimated growth in kiosks, revenue and profitability measures. Additionally, fair value may be negatively impacted by changes in our strategy related to ecoATM and increased competition from companies whose primary business consists of the purchase of used electronics and with companies in other businesses who also have buyback programs.

Excluding the impact of Gazelle on the fair value and carrying value of the ecoATM reporting unit, there have been no significant changes in our expectations for the ecoATM reporting unit from the June 30, 2015 valuation date, when the estimated fair value of the ecoATM reporting unit equaled its carrying value, to the November 30, 2015 annual measurement date, that indicated the carrying value of the ecoATM reporting unit exceeded its fair value as of November 30, 2015.

When performing step one comparing the fair value of a reporting unit with its carrying amount, we estimate the fair value of all of our goodwill bearing reporting units using both the income and market approaches and reconcile these approaches to our enterprise market capitalization as of our annual measurement date of November 30, considering whether the control premium indicated is reasonable. We also consider our current market capitalization as of the reporting date and for a period of time around the reporting date. Our estimates of fair value for all of our reporting units can change significantly based on factors such as revenue growth rates, profit margins, discount rates, market conditions, market prices, and changes in business strategies. As the estimated fair value of each reporting unit exceeded its respective carrying value in the first step of the goodwill impairment test performed as of November 30, it was not necessary to proceed to the second step and there was no additional goodwill impairment in 2015.

As a measure of sensitivity, a 10% decrease in the fair value of our Redbox, Coinstar and ecoATM reporting units as of November 30, 2015, respectively, would have had no impact on the carrying value of our goodwill.

For additional information see Note 6: Goodwill and Other Intangible Assetsin our Notes to Consolidated Financial Statements.

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Lives and Recoverability of Equipment and Other Long-Lived Assets

We evaluate the estimated remaining life and recoverability of equipment and other assets, including intangible assets subject to amortization, whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Factors that would indicate potential impairment include, but are not limited to, significant decreases in the market value of the long-lived asset(s), a significant change in the long-lived asset’s use or physical condition, and operating or cash flow losses associated with the use of the long-lived asset. When there is an indication of impairment, we prepare an estimate of future undiscounted cash flows expected to result from the use of the asset and its eventual disposition to test recoverability. If the sum of the future undiscounted cash flow is less than the carrying value of the asset, it indicates that the long-lived asset is not recoverable, in which case we will then compare the estimated fair value to its carrying value. If the estimated fair value is less than the carrying value of the asset, we recognize the impairment loss and adjust the carrying amount of the asset to its estimated fair value.

During the fourth quarter of 2013, we discontinued three new venture concepts, Rubi, Crisp Market and Star Studio. During the second quarter of 2013 we discontinued our Orango concept. As a result of the decision to discontinue the four concepts, for each concept we estimated the fair value of assets held utilizing a cash flow approach. For each of the concepts and for certain shared service assets used for the new ventures, as of December 31, 2013, we estimated the fair value of the assets was zero and recorded impairment charges for each concept. See Note 12: Discontinued Operationsin our Notes to Consolidated Financial Statements.

On January 23, 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the Company's performance expectations. On March 31, 2015, we completed the disposal of the Redbox Canada operations. As a result, we updated certain estimates used in the preparation of the financial statements and the remaining value of certain capitalized property and equipment, consisting primarily of installation costs, was amortized over the wind-down period ending March 31, 2015. See Note 12: Discontinued Operationsin our Notes to Consolidated Financial Statements.

Income Taxes

Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of our assets and liabilities and operating loss and tax credit carryforwards. We record a valuation allowance to reduce deferred tax assets to the amount expected to more likely than not be realized in our future tax returns. Deferred tax assets and liabilities and operating loss and tax credit carryforwards are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and operating loss and tax credit carryforwards are expected to be recovered or settled.

We assess our income tax positions and record tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate or effective settlement with a taxing authority that has full knowledge of all relevant information. In the event of a tax position where it would not be more likely than not that a tax benefit would be sustained, no tax benefit would be recognized in the financial statements. When applicable, associated interest and penalties have been recognized as a component of income tax expense. See Note 18: Income Taxes From Continuing Operations in our Notes to Consolidated Financial Statements.

Loss Contingencies

We accrue estimated liabilities for loss contingencies arising from claims, assessments, litigation and other sources when it is probable that a liability has been incurred and the amount of the claim assessment or damages can be reasonably estimated. We believe that we have sufficient accruals to cover any obligations resulting from claims, assessments or litigation that have met these criteria.

Accounting Pronouncements Not Yet Effective

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This ASU requires all deferred tax assets and liabilities to be presented in the balance sheet as noncurrent and is effective for us in our fiscal year beginning January 1, 2016. We elected to early adopt this new guidance in the fourth quarter of 2015 and have applied the changes retrospectively to all periods presented. See Note 2: Summary of Significant Accounting Policiesfor additional information.

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30). This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, instead of as a deferred charge. In August 2015, the FASB issued

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ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements (Subtopic 835-30). This ASU provides additional guidance to ASU 2015-03, which did not address presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-15 noted that the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted. As of December 31, 2015, we had $3.8 million of deferred financing fees recorded in other long-term assets in our Consolidated Balance Sheets.

In April 2015, the FASB issued ASU 2015-05, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. This ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The guidance will not change GAAP for a customer’s accounting for service contracts. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB deferred the effective date for annual reporting periods beginning after December 15, 2017. Early adoption is permitted to the original effective date of December 15, 2016. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. We are currently in the process of evaluating the impact of ASU 2014-09.

In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This ASU describes how an entity’s management should assess whether there are conditions and events that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management should consider both quantitative and qualitative factors in making its assessment.

If after considering management’s plans, substantial doubt about an entity’s going concern is alleviated, an entity shall disclose information in the footnotes that enables the users of the financial statements to understand the events that raised the going concern and how management’s plan alleviated this concern.

If after considering management’s plans, substantial doubt about an entity’s going concern is not alleviated, the entity shall disclose in the footnotes indicating that a substantial doubt about the entity’s going concern exists within one year of the date of the issued financial statements. Additionally, the entity shall disclose the events that led to this going concern and management’s plans to mitigate them.

We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Variable Rates of Interest

We are subject to the risk of fluctuating interest rates in the normal course of business, primarily as a result of our Credit Facility and investment activities that generally bear interest at variable rates. Because our investments have maturities of three months or less and our Credit Facility interest rates are based upon either the LIBOR, prime rate or base rate plus an applicable margin, we believe that the risk of material loss is low and that the carrying amount of these balances approximates fair value.

Based on the principal balance of our outstanding term loans of $136.9 million as of December 31, 2015, an increase or decrease of one percentage point in the interest rate over the next year would increase or decrease our annual interest expense by approximately $1.4 million, before tax benefits.

Foreign Exchange Rate Fluctuation

We are subject to the risk of foreign exchange rate fluctuation in the normal course of business as a result of our operations in the United Kingdom, Ireland, and Canada.

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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Unaudited quarterly financial data for each of the eight quarters in the two-year period ended December 31, 2015 is as follows:

2015 (In thousands, except per share data)	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter
Revenue	$	608,636		$	545,369		$	512,055		$	527,151
Income (loss) from continuing operations before income taxes	$	67,997		$	(29,166	)	$	58,520		$	25,714
Income tax expense	(25,842		)	(18,185		)	(20,928		)	(8,664		)
Income (loss) from continuing operations	42,155			(47,351		)	37,592			17,050
Income (loss) from discontinued operations, net of tax	(6,556		)	1,735			(256		)	(32		)
Net income (loss)	$	35,599		$	(45,616	)	$	37,336		$	17,018
Income (loss) from continuing operations attributable to common shares - basic	$	40,775		$	(47,472	)	$	36,462		$	16,602
Income (loss) from continuing operations attributable to common shares - diluted	$	40,776		$	(47,472	)	$	36,462		$	16,602
Basic earnings (loss) per share from continuing operations	$	2.23		$	(2.66	)	$	2.12		$	1.00
Basic earnings (loss) per share from discontinued operations	(0.36		)	0.10			(0.02		)	—
Basic earnings (loss) per share	$	1.87		$	(2.56	)	$	2.10		$	1.00
Diluted income (loss) per share from continuing operations	$	2.23		$	(2.66	)	$	2.12		$	1.00
Diluted earnings (loss) per share from discontinued operations	(0.36		)	0.10			(0.02		)	—
Diluted earnings (loss) per share	$	1.87		$	(2.56	)	$	2.10		$	1.00
Shares used in basic per share calculations	18,269			17,848			17,220			16,552
Shares used in diluted per share calculations	18,286			17,848			17,229			16,575
2014 (In thousands, except per share data)	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter
Revenue	$	597,762		$	546,527		$	549,899		$	597,398
Income from continuing operations before income taxes	$	43,040		$	30,138		$	35,515		$	82,148
Income tax expense	(15,434		)	(6,305		)	(13,392		)	(31,033		)
Income from continuing operations	27,606			23,833			22,123			51,115
Loss from discontinued operations, net of tax	(4,431		)	(2,080		)	(4,233		)	(7,315		)
Net income	$	23,175		$	21,753		$	17,890		$	43,800
Income from continuing operations attributable to common shares - basic	$	26,860		$	23,016		$	21,384		$	49,462
Income from continuing operations attributable to common shares - diluted	$	26,879		$	23,036		$	21,392		$	49,468
Basic earnings per share from continuing operations	$	1.12		$	1.18		$	1.14		$	2.69
Basic loss per share from discontinued operations	(0.18		)	(0.11		)	(0.23		)	(0.40		)
Basic earnings per share	$	0.94		$	1.07		$	0.91		$	2.29
Diluted earnings per share from continuing operations	$	1.09		$	1.15		$	1.12		$	2.68
Diluted loss per share from discontinued operations	(0.18		)	(0.10		)	(0.22		)	(0.40		)
Diluted earnings per share	$	0.91		$	1.05		$	0.90		$	2.28
Shares used in basic per share calculations	23,944			19,541			18,798			18,412
Shares used in diluted per share calculations	24,575			20,048			19,021			18,473

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Outerwall Inc.:

We have audited the accompanying consolidated balance sheets of Outerwall Inc. and subsidiaries (the “Company”) as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income, stockholders’ equity (deficit), and cash flows for each of the years in the three‑year period ended December 31, 2015. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Outerwall Inc. and subsidiaries as of December 31, 2015 and 2014, and the results of their operations and their cash flows for each of the years in the three‑year period ended December 31, 2015, in conformity with U.S. generally accepted accounting principles.

As discussed in Note 2 to the financial statements, the Company elected to change its method of accounting for content library amortization in 2013.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), Outerwall Inc.’s internal control over financial reporting as of December 31, 2015, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated February 4, 2016 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

(signed) KPMG LLP

Seattle, Washington

February 4, 2016

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Outerwall Inc.:

We have audited Outerwall Inc.’s internal control over financial reporting as of December 31, 2015, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Outerwall Inc.’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, Outerwall Inc. maintained, in all material respects, effective internal control over financial reporting as of December 31, 2015, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Outerwall Inc. acquired Gazelle, Inc. (Gazelle) during 2015 and management excluded from its assessment of the effectiveness of Outerwall Inc.’s internal control over financial reporting as of December 31, 2015, Gazelle’s internal control over financial reporting associated with total assets of $24.0 million and total revenue of $13.3 million included in the consolidated financial statements of Outerwall Inc. and subsidiaries as of and for the year ended December 31, 2015. Our audit of internal control over financial reporting of Outerwall Inc. also excluded an evaluation of the internal control over financial reporting of Gazelle.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated balance sheets of Outerwall Inc. and subsidiaries as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income, stockholders’ equity (deficit), and cash flows for each of the years in the three-year period ended December 31, 2015, and our report dated February 4, 2016 expressed an unqualified opinion on those consolidated financial statements.

(signed) KPMG LLP

Seattle, Washington

February 4, 2016

55

OUTERWALL INC.

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

	December 31,
	2015			2014
Assets
Current Assets:
Cash and cash equivalents	$	222,549		$	242,696
Accounts receivable, net of allowances of $1,272 and $2,223	38,464			48,590
Content library	188,490			180,121
Prepaid expenses and other current assets	51,368			39,819
Total current assets	500,871			511,226
Property and equipment, net	316,013			428,468
Deferred income taxes	2,606			11,363
Goodwill and other intangible assets, net (Note 6)	540,514			623,998
Other long-term assets	6,056			8,231
Total assets	$	1,366,060		$	1,583,286
Liabilities and Stockholders’ Equity (Deficit)
Current Liabilities:
Accounts payable	$	184,010		$	168,633
Accrued payable to retailers	115,098			126,290
Other accrued liabilities	141,437			137,126
Current portion of long-term debt and other long-term liabilities	17,131			20,416
Total current liabilities	457,676			452,465
Long-term debt and other long-term liabilities (Note 8)	897,366			973,669
Deferred income taxes	33,092			59,774
Total liabilities	1,388,134			1,485,908
Commitments and contingencies (Note 16)
Stockholders’ Equity (Deficit):
Preferred stock, $0.001 par value - 5,000,000 shares authorized; no shares issued or outstanding	—			—
Common stock, $0.001 par value - 60,000,000 authorized;
36,720,579 and 36,600,166 shares issued;
16,607,516 and 18,926,242 shares outstanding;	485,163			473,592
Treasury stock	(1,151,063		)	(996,293		)
Retained earnings	643,452			620,389
Accumulated other comprehensive income (loss)	374			(310		)
Total stockholders’ equity (deficit)	(22,074		)	97,378
Total liabilities and stockholders’ equity (deficit)	$	1,366,060		$	1,583,286

See accompanying Notes to Consolidated Financial Statements

56

OUTERWALL INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands, except per share data)

	Year Ended December 31,
	2015			2014			2013
Revenue	$	2,193,211		$	2,291,586		$	2,299,785
Expenses:
Direct operating(1)	1,493,088			1,581,311			1,556,999
Marketing	35,674			35,293			30,227
Research and development	7,198			13,047			13,082
General and administrative	190,393			190,496			215,798
Restructuring and related costs(Note 11)	27,153			557			4,495
Depreciation and other	171,390			187,824			189,401
Amortization of intangible assets	13,550			14,654			10,907
Goodwill impairment (Note 6)	85,890			—			—
Total expenses	2,024,336			2,023,182			2,020,909
Operating income	168,875			268,404			278,876
Other income (expense), net:
Income (loss) from equity method investments, net (Note 7)	(800		)	(28,734		)	19,928
Interest expense, net	(42,353		)	(47,644		)	(32,807		)
Other, net	(2,657		)	(1,185		)	(3,599		)
Total other expense, net	(45,810		)	(77,563		)	(16,478		)
Income from continuing operations before income taxes	123,065			190,841			262,398
Income tax expense	(73,619		)	(66,164		)	(39,710		)
Income from continuing operations	49,446			124,677			222,688
Loss from discontinued operations, net of tax (Note 12)	(5,109		)	(18,059		)	(47,896		)
Net income	44,337			106,618			174,792
Foreign currency translation adjustment(2)	684			457			856
Comprehensive income	$	45,021		$	107,075		$	175,648
Income from continuing operations attributable to common shares (Note 13):
Basic	$	48,117		$	120,748		$	217,215
Diluted	$	48,118		$	120,806		$	217,394
Basic earnings (loss) per common share (Note 13):
Continuing operations	$	2.75		$	5.98		$	7.98
Discontinued operations	(0.29		)	(0.89		)	(1.76		)
Basic earnings per common share	$	2.46		$	5.09		$	6.22
Diluted earnings (loss) per common share (Note 13):
Continuing operations	$	2.75		$	5.89		$	7.72
Discontinued operations	(0.29		)	(0.88		)	(1.70		)
Diluted earnings per common share	$	2.46		$	5.01		$	6.02
Weighted average common shares used in basic and diluted per share calculations (Note 13):
Basic	17,467			20,192			27,216
Diluted	17,487			20,503			28,169
Dividends declared per common share (Note 20)	$	1.20		$	—		$	—

(1) “Direct operating” excludes depreciation and other of $118.7 million, $125.7 million and $129.1 million for 2015, 2014 and 2013, respectively.

(2) Foreign currency translation adjustment had no tax effect in 2015, 2014 and 2013.

See accompanying Notes to Consolidated Financial Statements

57

OUTERWALL INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)

(in thousands, except share data)

												Accumulated Other Comprehensive Income (Loss)
	Common Stock					Treasury			Retained
	Shares		Amount			Stock			Earnings						Total
BALANCE, December 31, 2012	28,626,323		$	504,881		$	(293,149	)	$	338,979		$	(1,623	)	$	549,088
Proceeds from exercise of stock options, net	411,902		12,655			—			—			—			12,655
Adjustments related to tax withholding for share-based compensation	(76,401	)	(4,195		)	—			—			—			(4,195		)
Share-based payments expense	223,173		16,831			—			—			—			16,831
Excess tax benefit on share-based compensation expense	—		3,287			—			—			—			3,287
Repurchases of common stock	(3,306,433	)	—			(195,004		)	—			—			(195,004		)
Repurchase and conversion of callable convertible debt, net of tax	272,336		(49,532		)	11,357			—			—			(38,175		)
Debt conversion feature	—		(1,446		)	—			—			—			(1,446		)
Net income	—		—			—			174,792			—			174,792
Foreign currency translation adjustment(1)	—		—			—			—			856			856
BALANCE, December 31, 2013	26,150,900		$	482,481		$	(476,796	)	$	513,771		$	(767	)	$	518,689
Proceeds from exercise of stock options, net	103,260		3,735			—			—			—			3,735
Adjustments related to tax withholding for share-based compensation	(61,543	)	(4,255		)	—			—			—			(4,255		)
Share-based payments expense	227,092		13,036			1,388			—			—			14,424
Excess tax benefit on share-based compensation expense	—		1,920			—			—			—			1,920
Repurchases of common stock	(7,925,227	)	—			(545,140		)	—			—			(545,140		)
Repurchase and conversion of callable convertible debt, net of tax	431,760		(24,771		)	24,255			—			—			(516		)
Adjustment and settlement of debt conversion feature classified as temporary equity	—		1,446			—			—			—			1,446
Net income	—		—			—			106,618			—			106,618
Foreign currency translation adjustment(1)	—		—			—			—			457			457
BALANCE, December 31, 2014	18,926,242		$	473,592		$	(996,293	)	$	620,389		$	(310	)	$	97,378
Proceeds from exercise of stock options, net	48,992		2,552			—			—			—			2,552
Adjustments related to tax withholding for share-based compensation	(60,255	)	(4,013		)	—			—			—			(4,013		)
Share-based payments expense	206,676		12,258			5,030			—			—			17,288
Excess tax benefit on share-based compensation expense	—		774			—			—			—			774
Repurchases of common stock	(2,514,139	)	—			(159,800		)	—			—			(159,800		)
Net income	—		—			—			44,337			—			44,337
Dividends (Note 20)	—		—			—			(21,274		)	—			(21,274		)
Foreign currency translation adjustment(1)	—		—			—						684			684
BALANCE, December 31, 2015	16,607,516		$	485,163		$	(1,151,063	)	$	643,452		$	374		$	(22,074	)

(1) Foreign currency translation adjustment had no tax effect for the years ended December 31, 2015, 2014 and 2013.

See accompanying Notes to Consolidated Financial Statements

58

OUTERWALL INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2015			2014			2013
Operating Activities:
Net income	$	44,337		$	106,618		$	174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	177,247			195,162			193,700
Amortization of intangible assets	13,594			14,692			10,933
Share-based payments expense	17,240			13,384			16,831
Windfall excess tax benefits related to share-based payments	(739		)	(1,964		)	(3,698		)
Deferred income taxes	(19,619		)	(22,611		)	(10,933		)
Restructuring, impairment and related costs(2)	2,054			—			32,732
(Income) loss from equity method investments, net	800			28,734			(19,928		)
Amortization of deferred financing fees and debt discount	2,761			4,116			6,394
(Gain) loss from early extinguishment of debt	(5,854		)	2,018			6,013
Gain on purchase of Gazelle (Note 3)	(989		)	—			—
Goodwill impairment (Note 6)	85,890			—			—
Other	(972		)	(1,750		)	(2,039		)
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	10,011			8,671			7,978
Content library	(8,320		)	19,747			(22,459		)
Prepaid expenses and other current assets	(10,065		)	44,282			(50,542		)
Other assets	162			1,702			230
Accounts payable	17,943			(68,912		)	1,491
Accrued payable to retailers	(9,968		)	(6,847		)	(4,088		)
Other accrued liabilities	10,572			1,309			(9,573		)
Net cash flows from operating activities(1)	326,085			338,351			327,834
Investing Activities:
Purchases of property and equipment	(77,591		)	(97,924		)	(161,412		)
Proceeds from sale of property and equipment	3,225			1,977			13,344
Acquisitions, net of cash acquired	(17,980		)	—			(244,036		)
Receipt of note receivable principal	—			—			22,913
Cash paid for equity investments	—			(24,500		)	(28,000		)
Extinguishment payment received from equity investment	—			5,000			—
Net cash flows used in investing activities(1)	(92,346		)	(115,447		)	(397,191		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	—			295,500			343,769
Proceeds from new borrowing on Credit Facility	310,500			642,000			400,000
Principal payments on Credit Facility	(339,375		)	(680,125		)	(215,313		)
Financing costs associated with Credit Facility and senior unsecured notes(3)	(9		)	(2,911		)	(2,203		)
Settlement and conversion of convertible debt	—			(51,149		)	(172,211		)
Repurchase of Notes (Note 9)	(34,589		)	—			—
Repurchases of common stock(4)	(159,800		)	(545,091		)	(195,004		)
Dividends paid (Note 20)	(21,210		)	—			—
Principal payments on capital lease obligations and other debt	(11,510		)	(13,996		)	(14,834		)
Windfall excess tax benefits related to share-based payments	739			1,964			3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(1,461		)	(520		)	8,460
Net cash flows from (used in) financing activities(1)	$	(256,715	)	$	(354,328	)	$	156,362

59

	Year Ended December 31,
	2015			2014			2013
Effect of exchange rate changes on cash	$	2,829		$	2,683		$	1,538
Increase (decrease) in cash and cash equivalents	(20,147		)	(128,741		)	88,543
Cash and cash equivalents:
Beginning of period	242,696			371,437			282,894
End of period	$	222,549		$	242,696		$	371,437
Supplemental disclosure of cash flow information:
Cash paid during the period for interest	$	45,502		$	41,614		$	20,699
Cash paid during the period for income taxes, net	$	100,544		$	36,777		$	55,989
Supplemental disclosure of non-cash investing and financing activities:
Purchases of property and equipment financed by capital lease obligations	$	2,397		$	8,198		$	7,408
Purchases of property and equipment included in ending accounts payable	$	2,577		$	8,255		$	6,656
Non-cash gain included in equity investments	$	—		$	—		$	68,376
Common stock issued on conversion of callable convertible debt, net of tax	$	—		$	24,255		$	14,292
Non-cash debt issue costs(3)	$	—		$	4,500		$	6,231

(1) During 2015 we discontinued our Redbox operations in Canada. 2014 also includes the wind-down process of certain new ventures that were discontinued during 2013. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

(2) The non-cash restructuring, impairment and related costs in 2015 of$2.1 million is composed of $7.4 million in impairments of lease related assets partially offset by a $5.3 million benefit resulting from the lease termination. The 2013 non-cash charge represents asset impairments of $32.7 million related to our four ventures previously included in our former New Ventures segment, Orango, Rubi, Crisp Market, and Star Studio, which were discontinued during 2013.

(3) Total financing costs associated with the Credit Facility and senior unsecured notes issued in 2014 were $8.2 millioncomposed of non-cash debt issue costs of $4.5 million recorded as debt discount associated with our issuance of $300.0 million senior unsecured notes due 2021, $1.5 million in deferred financing fees associated with the senior unsecured notes, and $2.2 million in deferred financing fees associated with the refinancing of our Credit Facility. The cash payments for financing costs associated with the Credit Facility and senior unsecured notes in 2014 were $2.9 million.

(4) The total cost of repurchases of common stock in 2014 was$545.1 million, which includes $3.7 million in fees and expenses relating to the tender offer recorded as part of the cost of treasury stock in our Consolidated Balance Sheets. The cash payments for the tender offer fees in 2014 were $3.7 million.

See accompanying Notes to Consolidated Financial Statements

60

INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

		Page
Note 1	Organization and Business	62
Note 2	Summary of Significant Accounting Policies	63
Note 3	Business Combinations	71
Note 4	Prepaid Expenses and Other Current Assets and Other Accrued Liabilities	72
Note 5	Property and Equipment	73
Note 6	Goodwill and Other Intangible Assets	73
Note 7	Equity Method Investments	76
Note 8	Debt and Other Long-Term Liabilities	77
Note 9	Repurchases of Common Stock	79
Note 10	Share-Based Payments	80
Note 11	Restructuring	83
Note 12	Discontinued Operations	85
Note 13	Earnings Per Share	88
Note 14	Business Segments and Enterprise-Wide Information	89
Note 15	Fair Value	92
Note 16	Commitments and Contingencies	93
Note 17	Guarantor Subsidiaries	97
Note 18	Income Taxes From Continuing Operations	108
Note 19	Retirement Plans	110
Note 20	Dividends	111
Note 21	Subsequent Events	111

61

OUTERWALL INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

YEARS ENDED DECEMBER 31, 2015, 2014, 2013

Note 1: Organization and Business

Description of Business

We are a leading provider of automated retail solutions offering convenient products and services that benefit consumers and drive incremental retail traffic and revenue for retailers. During 2015:

• We made the decision to discontinue operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit does not represent a major component of our operations or financial results, the results of SAMPLEit do not qualify to be reported as a discontinued operation and remain in our All Other reporting category. See Note 14: Business Segments and Enterprise-Wide Information for additional information.

• To align with a change in how our chief operating decision maker evaluates business performance, we added ecoATM, our electronic device recycling business, as a separate reportable segment in the first quarter of 2015. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts are included in our All Other reporting category as they do not meet quantitative thresholds to be reported as a separate segment. See Note 14: Business Segments and Enterprise-Wide Information for additional information.

• We discontinued our Redbox operations in Canada ("Redbox Canada") as the business was not meeting our performance expectations. We have reclassified the results of Redbox Canada to discontinued operations for all periods presented in our Consolidated Statements of Comprehensive Income. See Note 12: Discontinued Operations for additional information.

• We acquired certain assets and liabilities of Gazelle, Inc. ("Gazelle") in the fourth quarter of 2015. Results of operations for Gazelle from the acquisition date, November 10, 2015, are included in our ecoATM segment. See Note 3: Business Combinations and Note 14: Business Segments and Enterprise-Wide Information for additional information.

Our core offerings in automated retail include our Redbox, Coinstar and ecoATM segments. Our Redbox segment consists of self-service kiosks where consumers can rent or purchase movies and video games. Our Coinstar segment consists of self-service coin-counting kiosks where consumers can convert their coins to cash or stored value products. We also offer self-service kiosks that exchange gift cards for cash under our Coinstar™ Exchange brand. Our ecoATM segment consists of self-service kiosks and an online solution where consumers can sell certain electronic devices for cash and generates revenue through the sale of devices collected to third party resellers, through online marketplaces and through the Gazelle direct-to-consumer storefront.

In addition to our three reportable segments, we may also conduct business activities through other self-service concepts, where we identify, evaluate, build or acquire and develop new self-service retail concepts and regularly assess these concepts to determine whether continued funding or other alternatives are appropriate.

On July 23, 2013 we acquired the remaining 77.0% equity interest in our ecoATM business. We paid $262.9 million in cash and the primary assets received included property and equipment of $23.2 million, identified intangible assets of $41.4 million and goodwill of $264.2 million, which is not deductible for tax purposes. The primary reason for the business combination was to expand Outerwall’s presence in automated retail and gain exposure to the growing demand for refurbished products and mobile devices. Since the acquisition date, the results of ecoATM operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment. See Note 14: Business Segments and Enterprise-Wide Information for more information.

62

Our kiosks are located primarily in supermarkets, drug stores, mass merchants, convenience stores, financial institutions, malls and restaurants. Our kiosk and location counts as of December 31, 2015, are as follows:

	Kiosks	Locations
Redbox	40,480	33,060
Coinstar	20,930	19,660
ecoATM	2,250	2,020
All Other(1)	120	120
Total	63,780	54,860

(1) As part of our decision to discontinue operating SAMPLEit in the fourth quarter of 2015, all SAMPLEit kiosks were removed from their locations during January 2016.

Note 2: Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Outerwall Inc. and our wholly-owned subsidiaries. Investments in companies of which we may have significant influence, but not a controlling interest, are accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates in Financial Reporting

We prepare our financial statements in conformity with accounting principles generally accepted in the U.S. which requires management to make estimates and assumptions that affect the reported amounts in our consolidated financial statements and our notes thereto. The most significant estimates and assumptions include the:

• useful lives and salvage values of our content library;

• determination of goodwill impairment;

• lives and recoverability of equipment and other long-lived assets;

• recognition and measurement of current and long-term deferred income taxes (including the measurement of uncertain tax positions);

• recognition and measurement of purchase price allocation for business combinations; and

• loss contingencies.

It is reasonably possible that the estimates we make may change in the future and could have a material effect on our financial statements.

Cash and Cash Equivalents

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Our cash and cash equivalents were $222.5 million and $242.7 million at December 31, 2015, and December 31, 2014, respectively. Of this total, cash equivalents were $2.7 million and $0.9 million, respectively, and consisted of money market demand accounts and investment grade fixed income securities such as money market funds, certificate of deposits, and commercial paper. Our cash balances with financial institutions may exceed the deposit insurance limits.

Included in our cash and cash equivalents at December 31, 2015, and December 31, 2014, were $83.3 million and $81.7 million, respectively that we identified for settling our accrued payable to our retailer partners in relation to our Coinstar kiosks.

Separately included in our cash and cash equivalents at December 31, 2015, and December 31, 2014, were $46.2 million and $66.5 million, respectively in cash and cash equivalents held in financial institutions domestically and $9.0 million and $11.6 million, respectively in cash and cash equivalents held in foreign financial institutions.

63

Accounts Receivable

Accounts receivable represents receivables, net of allowances for doubtful accounts. The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balance. We determine the allowance based on historical experience and other currently available information. When a specific account is deemed uncollectible, the account is written off against the allowance. Amounts expensed for uncollectible accounts and amounts charged against the allowance were immaterial in all periods presented.

Content Library

Content library consists of movies and video games available for rent or purchase. We obtain our movie and video game content primarily through revenue sharing agreements and license agreements with studios and game publishers, as well as through distributors and other suppliers. The cost of content mainly includes the cost of the movies and video games, labor, overhead, freight, and studio revenue sharing expenses. The content purchases are capitalized and amortized to their estimated salvage value as a component of direct operating expenses over the usage period. For purchased content that we expect to sell at the end of its useful life, we determine an estimated salvage value. Content salvage values are estimated based on the amounts that we have historically recovered on disposal. For licensed content that we do not expect to sell, no salvage value is provided. The useful lives and salvage value of our content library are periodically reviewed and evaluated. Amortization charges are derived utilizing rental curves based on historical performance of movies and games over their useful lives and recorded on an accelerated basis, reflecting higher rentals of movies and video games in the first few weeks after release, and substantially all of the amortization expense is recognized within one year of purchase.

In the second quarter of 2013, we completed a review of our content library amortization methodology and updated the methodology in order to add greater precision to product cost amortization. The previous method recognized accelerated amortization of content library costs at a rate faster than the decline in the content library's value due to the recognition of charges in addition to the normal rental curve amortization whenever individual discs were removed from kiosks, a process we define as "thinning". The Company's most recent analysis has shown that its amortization curves can reasonably capture the effect of thinning and therefore eliminates the need for additional charges at the time of thinning and provides a better correlation of costs to revenue. The modified approach to amortizing the cost of the content library is based on updated rental curves, which incorporate thinning estimates, and provides a more systematic method for recognizing the costs of movie and game titles that better aligns the recognition of costs with the related revenue.

The Company believes that the change in its content library amortization methodology, made on a prospective basis, is a change in accounting estimate that is affected by a change in accounting principle. The Company believes that the modified content library amortization methodology is preferable because it better reflects the pattern of consumption of the expected benefits of the content library. A copy of our auditor's preferability letter is filed as an exhibit to our 10-Q for the period ended June 30, 2013.

The effect of this change resulted in a reduction of product costs, as reported in direct operating expenses, of approximately $21.7 million in the second quarter of 2013, with those costs shifted to primarily the third and fourth quarters and some into 2014. The change resulted in a corresponding increase to the balance of our content library. In addition, the change in amortization methodology shifted product costs on titles purchased during the second half of 2013 into 2014 as amortization is less accelerated than under the prior method. Under the modified amortization methodology we continue to recognize substantially all of the amortization expense within one year of purchase. For year ended December 31, 2013, the change resulted in a total pretax benefit of $31.8 million or $1.17 per basic share and $1.12 per diluted share.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve the efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the following approximate useful lives:

	Useful Life
Coin-counting kiosks and components	2 - 10 years
Redbox kiosks and components	3 - 5 years
ecoATM kiosk and components	5 years
Computers and software	3 - 5 years
Office furniture and equipment	5 - 7 years
Leased vehicles	3 - 6 years
Leasehold improvements (shorter of life of asset or remaining lease term)	1 - 11 years

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Internal-Use Software

We capitalize costs incurred to develop or obtain internal-use software during the application development stage. Capitalization of software development costs occurs after the preliminary project stage is complete, management authorizes the project, and it is probable that the project will be completed and the software will be used for the function intended. We expense costs incurred for training, data conversion, and maintenance, as well as spending in the post-implementation stage. A subsequent addition, modification or upgrade to internal-use software is capitalized only to the extent that it enables the software to perform a task it previously could not perform. The internal-use software is included in computers and software under property and equipment in our Consolidated Balance Sheets. We amortize the internal-use software based on the estimated useful life on a straight-line basis.

Intangible Assets Subject to Amortization

Our intangible assets subject to amortization are primarily composed of developed technology and retailer relationships acquired in connection with our acquisitions. We used expectations of future cash flows, with appropriate discount rates based on the stage of the enterprise acquired, to estimate the fair value of our intangible assets. We amortize our intangible assets on a straight-line basis over their expected useful lives.

Goodwill

Goodwill represents the excess purchase price of an acquired enterprise or assets over the estimated fair value of identifiable net assets acquired. We assess goodwill for potential impairment at the reporting unit level on an annual basis as of November 30, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. We may assess qualitative factors to make this determination, or bypass such a qualitative assessment and proceed directly to testing goodwill for impairment using a two-step process. Qualitative factors we may consider include, but are not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments and entity specific factors such as strategies and financial performance. If, after completing such assessment, it is determined more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a two-step impairment test, whereby the first step is comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the test is not performed. The second step of the impairment test is performed when the carrying amount of the reporting unit exceeds the fair value, then the implied fair value of the reporting unit goodwill is compared with the carrying amount of that goodwill. If the carrying amount of the reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to the excess. For additional information see Note 6: Goodwill and Other Intangible Assets.

Lives and Recoverability of Equipment and Other Long-Lived Assets

We evaluate the estimated remaining life and recoverability of equipment and other assets, including intangible assets subject to amortization, whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Factors that would indicate potential impairment include, but are not limited to, significant decreases in the market value of the long-lived asset(s), a significant change in the long-lived asset’s use or physical condition, and operating or cash flow losses associated with the use of the long-lived asset. When there is an indication of impairment, we prepare an estimate of future undiscounted cash flows expected to result from the use of the asset and its eventual disposition to test recoverability. If the sum of the future undiscounted cash flow is less than the carrying value of the asset, it indicates that the long-lived asset is not recoverable, in which case we will then compare the estimated fair value to its carrying value. If the estimated fair value is less than the carrying value of the asset, we recognize the impairment loss and adjust the carrying amount of the asset to its estimated fair value.

During the fourth quarter of 2013, we discontinued three new venture concepts, Rubi^TM, Crisp Market^TM and Star Studio^TM. During the second quarter of 2013 we discontinued our Orango^TM concept. As a result of the decision to discontinue the four concepts, for each concept we estimated the fair value of assets held utilizing a cash flow approach. For each of the concepts and for certain shared service assets used for the new ventures, as of December 31, 2013, we estimated the fair value of the assets was zero and recorded impairment charges for each concept. See Note 12: Discontinued Operationsfor additional information.

On January 23, 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the Company's performance expectations. On March 31, 2015, we completed the disposal of the Redbox Canada operations. As a result, we updated certain estimates used in the preparation of the financial statements and the remaining value of certain capitalized property and equipment, consisting primarily of installation costs, was amortized over the wind-down period ending March 31, 2015. See Note 12: Discontinued Operationsfor additional information.

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Income Taxes

Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of our assets and liabilities and operating loss and tax credit carryforwards. We record a valuation allowance to reduce deferred tax assets to the amount expected to more likely than not be realized in our future tax returns. Deferred tax assets and liabilities and operating loss and tax credit carryforwards are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and operating loss and tax credit carryforwards are expected to be recovered or settled.

We assess our income tax positions and record tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate or effective settlement with a taxing authority that has full knowledge of all relevant information. In the event of a tax position where it would not be more likely than not that a tax benefit would be sustained, no tax benefit would be recognized in the financial statements. When applicable, associated interest and penalties have been recognized as a component of income tax expense. See Note 18: Income Taxes From Continuing Operations for additional information.

Taxes Collected from Customers and Remitted to Governmental Authorities

We account for tax assessed by a governmental authority that is directly imposed on a revenue-producing transaction (i.e., sales, value added) on a net (excluded from revenue) basis.

Convertible Debt

In September 2009, we issued $200.0 million aggregate principal amount of 4% Convertible Senior Notes (the “Convertible Notes”). The Convertible Notes were convertible as of December 31, 2013 and the debt conversion feature was classified as temporary equity on our Consolidated Balance Sheets. On September 2, 2014, the Convertible Notes matured. In 2014, we retired or settled upon maturity, a combined 51,148 Convertible Notes for total consideration of $51.1 million in cash and the issuance of 431,760 shares of common stock. The amount by which total consideration exceeded the fair value of the Convertible Notes has been recorded as a reduction of stockholders’ equity. The loss from early extinguishment of the Convertible Notes was approximately $0.3 million and is recorded in interest expense in our Consolidated Statements of Comprehensive Income.

Loss Contingencies

We accrue estimated liabilities for loss contingencies arising from claims, assessments, litigation and other sources when it is probable that a liability has been incurred and the amount of the claim assessment or damages can be reasonably estimated. We believe that we have sufficient accruals to cover any obligations resulting from claims, assessments or litigation that have met these criteria.

Revenue Recognition

We recognize revenue when persuasive evidence of a sale arrangement exists, delivery has occurred or services are rendered, the sales price or fee is fixed or determinable and collectability is reasonably assured as follows:

• Redbox - Revenue from movie and video game rentals is recognized ratably over the term of a consumer’s rental transaction. Revenue from a direct sale out of the kiosk of previously rented movies or video games is recognized at the time of sale. On rental transactions for which the related movie or video game has not yet been returned to the kiosk at month-end, revenue is recognized with a corresponding receivable recorded in the balance sheet, net of a reserve for potentially uncollectible amounts. We record revenue net of refunds and applicable sales taxes collected from consumers. In the fourth quarter of 2014, Redbox launched Redbox Play Pass, a new loyalty program, where customers can earn points redeemable for movie rentals. As customers accumulate points, we defer the estimated fair value of the points earned as deferred revenue (included within other current accrued liabilities). We deferred $2.5 million and $1.5 million as of December 31, 2015 and December 31, 2014, respectively. 

• Coinstar - Revenue from a coin transaction, which is collected from either consumers or card issuers (in stored value product transactions), is recognized at the time the consumers’ coins are collected by our coin-counting kiosks. Our revenue represents the fee charged for coin transactions.

• ecoATM - Revenue is recognized upon the sale and shipment of devices collected to third parties and consumers.

• All Other - Revenue was recognized in our discontinued SAMPLEit concept when the service transaction was completed.

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Fees Paid to Retailers

Fees paid to retailers relate to the amount we pay our retailers for the benefit of placing our kiosks in their stores and their agreement to provide certain services on our behalf to our consumers. The fee is generally calculated as a percentage of each coin-counting transaction or as a percentage of our net movie or video game rental revenue or a fixed fee and is recorded in our Consolidated Statements of Comprehensive Income within Direct operating expenses. The fee arrangements are based on our negotiations and evaluation of certain factors with the retailers such as total revenue, long-term non-cancelable contracts, installation of our kiosks in high traffic and/or urban or rural locations, co-op marketing incentives, or other criteria.

Advertising

Advertising costs, which are included as a component of marketing expenses, are expensed as incurred and totaled $15.2 million, $11.8 million and $11.7 million in 2015, 2014 and 2013, respectively.

Research and Development

Costs incurred for research and development activities are expensed as incurred.

Foreign Currency Translation

The functional currencies of our international subsidiaries are the British pound Sterling for our subsidiary Coinstar Limited in the United Kingdom, Canadian dollar for Coinstar International and Redbox Canada GP, and the Euro for our Coinstar Ireland Limited subsidiary. We translate assets and liabilities related to these operations to U.S. dollars at the exchange rate in effect at the date of the Consolidated Balance Sheets; we convert revenues and expenses into U.S. dollars using average exchange rates. Transaction gains and losses including on foreign currency intercompany transactions not deemed to be of a long term investment nature are included in Other income (expense), net on our Consolidated Statements of Comprehensive Income, except for those associated with discontinued operations which are included in Loss from discontinued operations, net of tax on our Consolidated Statements of Comprehensive Income. Translation gains and losses, including gains and losses on foreign currency intercompany transactions deemed to be of a long term investment nature, are reported as Accumulated other comprehensive loss in our Consolidated Balance Sheets.

Share-Based Payments

We measure and recognize expense for all share-based payment awards granted, including employee stock options and restricted stock awards, based on the estimated fair value of the award on the grant date. We utilize the Black-Scholes-Merton (“BSM”) valuation model for valuing our stock option awards and the determination of the expenses.

The use of the BSM valuation model to estimate the fair value of stock option awards requires us to make judgments on assumptions regarding the risk-free interest rate, expected dividend yield, expected term and expected volatility over the expected term of the award. The assumptions used in calculating the fair value of share-based payment awards represent management’s best estimates at the time they are made, but these estimates involve inherent uncertainties and the determination of expense could be materially different in the future.

We amortize share-based payment expense on a straight-line basis over the vesting period of the individual award with estimated forfeitures considered. Vesting periods are generally four years. Expense for performance based shares is recognized over the vesting period if and when we conclude that it is probable that the performance condition will be achieved. We reassess the probability of vesting at each reporting period for awards with performance conditions and adjust compensation cost based on our probability assessment.

Shares to be issued upon the exercise of stock options will come from newly issued shares. The expense related to restricted stock granted to movie studios as part of license agreements is adjusted based on the number of unvested shares and market price of our common stock each reporting period.

Share-based payment expense is only recognized on awards that ultimately vest. Therefore, we have reduced the share-based payment expense to be recognized over the vesting period for anticipated future forfeitures. Forfeiture estimates are based on historical forfeiture patterns. We review and assess our forfeiture estimates quarterly and update them if necessary. Any changes to accumulated share-based payment expense are recognized in the period of change. If actual forfeitures differ significantly from our estimates, our results of operations could be materially impacted. For additional information see Note 10: Share-Based Payments.

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Fair Value of Financial Instruments

The carrying amounts for cash equivalents approximate fair value, which is the amount for which the instrument could be exchanged in a current transaction between willing parties. Available-for-sale securities are marked to fair value on a quarterly basis. The fair value of our revolving line of credit approximates its carrying amount. For additional information see Note 15: Fair Value.

Reclassifications

To be consistent with our 2015 reporting, the following have been retrospectively reported in our Consolidated Statements of Comprehensive Income for all periods presented with no effect on net income, cash flows or stockholder's equity:

• Results of our Redbox Canada operations which were discontinued during the first quarter of 2015. See Note 12: Discontinued Operationsforadditional information;

• Restructuring and related costs. See Note 11: Restructuring for additional information; and

• Basic and diluted earnings per share as a result of applying the two-class method of calculating earnings per share (the “Two-Class Method”). During the first quarter of 2015, the Two-Class Method became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards (“participating securities”) as a percentage of total common shares outstanding. The impact of applying the Two-Class Method on both income from continuing operations and basic and diluted weighted average shares used to calculate earnings per common share is as follows:

	As Reported Under the Treasury Stock Method				Amount Allocated to Participating Securities						As Revised Under the Two-Class Method
In thousands, except per share data	2014		2013		2014			2013			2014		2013
Income from continuing operations used in basic per share calculation	$	124,677	$	222,688	$	(3,929	)	$	(5,473	)	$	120,748	$	217,215
Income from continuing operations used in diluted per share calculation	$	124,677	$	222,688	$	(3,871	)	$	(5,294	)	$	120,806	$	217,394
Weighted average shares used in basic per share calculation	20,192		27,216		—			—			20,192		27,216
Weighted average shares used in diluted per share calculation	20,699		28,381		(196		)	(212		)	20,503		28,169
Basic earnings per common share from continuing operations	$	6.17	$	8.18	$	(0.19	)	$	(0.20	)	$	5.98	$	7.98
Diluted earnings per common share from continuing operations	$	6.02	$	7.85	$	(0.13	)	$	(0.13	)	$	5.89	$	7.72

See Note 13: Earnings Per Sharefor additional information.

The accompanying consolidated financial statements include the accounts of Outerwall Inc. and our wholly-owned subsidiaries. Investments in companies of which we may have significant influence, but not a controlling interest, are accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

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Accounting Pronouncements Adopted During the Current Year

In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360) Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU 2014-08 changes the requirements for reporting discontinued operations. Under the ASU discontinued operations is defined as a:

• Component of an entity, or group of components, that

◦ has been disposed of, meets the criteria to be classified as held-for-sale, or has been abandoned/spun-off and

◦ represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, or a

◦ business or nonprofit activity that, on acquisition, meets the criteria to be classified as held-for-sale.

We adopted the provisions of ASU 2014-08 during the first quarter of 2015 and applied the guidance to our disposition of our Redbox operations in Canada (“Redbox Canada”). See Note 12: Discontinued Operationsfor additional information.

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This ASU requires all deferred tax assets and liabilities to be presented in the balance sheet as noncurrent and is effective for us in our fiscal year beginning January 1, 2016. We elected to early adopt this new guidance in the fourth quarter of 2015 and have applied the changes retrospectively. The changes to our 2014 Consolidated Balance Sheet as a result of adopting the new guidance are as follow:

In thousands, except per share data	As Reported		Reclassifications			As Revised
Assets:
Prepaid expenses and other current assets	$	39,837	$	(18	)	$	39,819
Deferred income taxes - long term	$	11,378	$	(15	)	$	11,363
Liabilities:
Deferred income taxes - current	$	21,432	$	(21,432	)	$	—
Deferred income taxes - long term	$	38,375	$	21,399		$	59,774

Accounting Pronouncements Not Yet Adopted

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30). This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, instead of as a deferred charge. In August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements (Subtopic 835-30). This ASU provides additional guidance to ASU 2015-03, which did not address presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-15 noted that the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted. As of December 31, 2015, we had $3.8 million of deferred financing fees recorded in other long-term assets in our Consolidated Balance Sheets.

In April 2015, the FASB issued ASU 2015-05, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. This ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The guidance will not change GAAP for a customer’s accounting for service contracts. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction

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price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB deferred the effective date for annual reporting periods beginning after December 15, 2017. Early adoption is permitted to the original effective date of December 15, 2016. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. We are currently in the process of evaluating the impact of ASU 2014-09.

In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This ASU describes how an entity’s management should assess whether there are conditions and events that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management should consider both quantitative and qualitative factors in making its assessment.

If after considering management’s plans, substantial doubt about an entity’s going concern is alleviated, an entity shall disclose information in the footnotes that enables the users of the financial statements to understand the events that raised the going concern and how management’s plan alleviated this concern.

If after considering management’s plans, substantial doubt about an entity’s going concern is not alleviated, the entity shall disclose in the footnotes indicating that a substantial doubt about the entity’s going concern exists within one year of the date of the issued financial statements. Additionally, the entity shall disclose the events that led to this going concern and management’s plans to mitigate them.

We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

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Note 3: Business Combinations

Acquisition of Gazelle, Inc.,

On October 29, 2015, Outerwall Inc. entered into an asset purchase agreement (the “Agreement”) with Gazelle, Inc., a Delaware corporation ("Gazelle") that provides consumers an on-line solution for the sale and purchase of used mobile phones, computers and tablets. This taxable transaction closed on November 10, 2015. The primary reasons for the business combination were to help drive our ecoATM business to profitability, provide margin and revenue uplift opportunities, and leverage a direct-to-consumer channel for collected devices.

We accounted for the purchase of Gazelle as a business combination. Costs related to this acquisition of approximately $0.3 million were expensed during the fourth quarter of 2015 and are included within general and administrative expenses in our Consolidated Statements of Comprehensive Income.

The following table shows the consideration transferred and the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation.

Dollars in thousands	November 10, 2015
Total consideration transferred	$	17,980
Assets acquired:
Accounts receivable	$	67
Prepaid expenses and other current assets	3,963
Property and equipment	252
Intangible assets	16,000
Total assets acquired	20,282
Liabilities assumed:
Deferred revenue	(750		)
Deferred tax liabilities	(563		)
Total liabilities assumed	(1,313		)
Total net assets acquired	$	18,969
Bargain purchase gain	$	989

The assets acquired and liabilities assumed, as well as the results of operations from the date of the acquisition, are included within our ecoATM segment. The purchase priced allocation resulted in the recognition of a gain on bargain purchase of approximately $1.0 million, which was included within other, net in our Consolidated Statements of Comprehensive Income. The gain on bargain purchase is primarily the result of acquiring certain assets of Gazelle, including the Gazelle trade name, in a transaction under which the previous investors were motivated to sell due to short-term liquidity concerns.

Acquired identifiable intangible assets and their estimated useful life in years are as follows:

Dollars in thousands	Purchase Price		Estimated Useful Life in Years
Trade name	$	14,000	10
Developed technology	$	2,000	3

The following table shows the revenue and operating loss included in our Consolidated Statements of Comprehensive Income resulting from the acquisition of Gazelle since the closing date, including the amortization for acquired intangibles which are included in our ecoATM segment:

	Year Ended
Dollars in thousands	December 31, 2015
Revenue	$	13,269
Operating loss	$	948

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Pro forma information

The following unaudited pro forma information represents the results of operations for Outerwall Inc. and includes the Gazelle business acquired as if the acquisition was consummated as of January 1, 2014.

	Years Ended December 31,
	(Unaudited)
Dollars in thousands	2015		2014
Pro-forma revenue	$	2,264,467	$	2,378,508
Pro-forma income from continuing operations	$	38,524	$	114,641

The unaudited pro forma results have been adjusted with respect to certain aspects of our acquisition of Gazelle to reflect:

• changes in assets to record their acquisition date fair values and the resulting changes in amortization;

• adjustments for the bargain purchase gain and costs related to the acquisition; and

• the income tax impact of the pro forma adjustments at a combined federal and state statutory rate of 37.5%.

The unaudited pro forma results do not reflect future events that may occur after the acquisition, including, but not limited to, the anticipated realization of ongoing savings from operating synergies in subsequent periods.

Note 4: Prepaid Expenses and Other Current Assets and Other Accrued Liabilities

Prepaid expenses and other current assets

	December 31,
Dollars in thousands	2015		2014
Spare parts	$	9,780	$	13,643
Licenses	6,394		5,881
Electronic devices inventory	7,846		5,259
Income taxes receivable	9,517		95
Prepaid rent	1,043		1,446
DVD cases and labels	1,371		1,330
Other	15,417		12,165
Total prepaid and other current assets	$	51,368	$	39,819

Other accrued liabilities

	December 31,
Dollars in thousands	2015		2014
Payroll related expenses	$	40,676	$	33,343
Studio revenue share and other content related expenses	28,964		23,226
Business taxes	16,080		21,629
Insurance	13,594		9,615
Deferred revenue	11,201		6,995
Income taxes payable	16		9,463
Accrued interest expense	6,913		6,974
Accrued early lease termination and sublease expenses	4,991		—
Service contract provider expenses	4,070		4,191
Deferred rent expense	1,728		6,162
Other	13,204		15,528
Total other accrued liabilities	$	141,437	$	137,126

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Note 5: Property and Equipment

	December 31,
Dollars in thousands	2015			2014
Kiosks and components	$	1,163,210		$	1,165,925
Computers, servers, and software	193,507			200,915
Leasehold improvements	22,663			29,625
Office furniture and equipment	7,047			9,218
Vehicles	5,118			6,234
Property and equipment, at cost	1,391,545			1,411,917
Accumulated depreciation and amortization	(1,075,532		)	(983,449		)
Property and equipment, net	$	316,013		$	428,468

During 2015 we recognized:

• $5.0 million of accelerated depreciation as a result of our decision to discontinue operating SAMPLEit. See Note 14: Business Segments and Enterprise-Wide Information for additional information; and

• $7.4 million of impairment charges in connection with our early lease termination. See Note 11: Restructuring for additional information.

Note 6: Goodwill and Other Intangible Assets

Goodwill

We assess goodwill for potential impairment at the reporting unit level on an annual basis as of November 30, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. During the three months ended June 30, 2015, it became evident that revenue and profitability trends in our ecoATM reporting unit were not being achieved as expected. For example collection rates, revenue and profitability on a per kiosk basis experienced declines versus prior periods and expected seasonal trends. As a result, we revised our internal expectations for future revenue growth and profitability lower than our previous estimates. This is primarily driven by certain challenges in an increasingly competitive industry which impact the per kiosk device collection, revenue and profitability expectations and the timing and installation of kiosks. Further, while these competitive challenges grew more acute during the second quarter, we also experienced the loss of a key executive at ecoATM. This led to an indication in the second quarter of 2015 that ecoATM’s fair value was more likely than not below its carrying value.

As a result, we performed the first step of the goodwill impairment test with the assistance of a third-party valuation specialist. The first step of the impairment test was completed by comparing the carrying value of ecoATM, including goodwill, to its fair value determined using a weighted combination of a discounted cash flow (“DCF”) income based approach and a guideline public company market based approach. The DCF methodology requires significant judgment in selecting appropriate inputs including the risk adjusted market cost of capital for the discount rate, the terminal growth rate and projections of future cash flows, all of which are inherently uncertain. The guideline public company method involves significant judgment in selecting the appropriate inputs including the peer company group, the selection of relevant multiples and the determination of a reasonable control premium. Due to these significant judgments, the fair value determined in connection with the goodwill impairment test may not necessarily be indicative of the actual value that would be recognized in a future transaction. Completion of the first step of the impairment test determined that the carrying amount of ecoATM exceeded its fair value and that the second step of the impairment test needed to be performed.

Under the second step of the impairment test, we completed the process of estimating the fair value of ecoATM’s assets and liabilities, including intangible assets consisting of developed technology, trade name and covenants not to compete for the purpose of deriving an estimate of the implied fair value of goodwill. The estimate of the implied fair value of goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Significant assumptions used in measuring the value of these assets and liabilities included the discount rates and obsolescence rates used in valuing the intangible assets, and replacement costs for valuing the tangible assets. The inputs and assumptions used in our goodwill impairment test are classified as Level 3 inputs within the fair value hierarchy.

Based on the result of the second step of the goodwill impairment analysis, we recognized a non-cash, non-tax deductible charge for goodwill impairment of $85.9 million related to our ecoATM business segment in the second quarter of 2015.

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As a result of the impairment recorded, the estimated fair value of the ecoATM reporting unit equaled its carrying value as of June 30, 2015.

Gross amount of goodwill and accumulated impairment charges that we have recorded are as follows:

Dollars in thousands
Goodwill	$	559,307
Accumulated impairment losses	(85,890		)
Net goodwill at December 31, 2015	$	473,417

Goodwill by Segment

A reconciliation of the beginning and ending carrying amounts of goodwill by segment is as follows:

Dollars in thousands	December 31, 2014		Goodwill Impairment			December 31, 2015
Redbox	$	138,743	$	—		$	138,743
Coinstar	156,351		—			156,351
ecoATM	264,213		(85,890		)	178,323
Total goodwill	$	559,307	$	(85,890	)	$	473,417

We elected to by-pass the qualitative assessment and performed the annual goodwill impairment test based on a quantitative analysis as of November 30, 2015. We estimated the fair value of our goodwill bearing reporting units using both the income and market approaches and reconciled these approaches to our enterprise market capitalization as of November 30, considering a reasonable control premium. Our estimates of fair value can change significantly based on factors such as revenue growth rates, profit margins, discount rates, market conditions, market prices, and changes in business strategies. As the estimated fair value of each reporting unit exceeded its respective carrying value in the first step of the goodwill impairment test it was not necessary to proceed to the second step and there was no additional goodwill impairment in 2015. Subsequent to our testing date of November 30, we also considered the change in our market capitalization between the measurement date and December 31, 2015 and subsequent to our fiscal year end. Considering factors such as the average price of our stock during 2015, in conjunction with the other methodologies and factors noted above, we determined that the decrease in our market capitalization did not change our conclusions made as of the measurement date.

The acquired assets and liabilities of Gazelle (See Note 3: Business Combinations for further information), are included in the carrying value of our ecoATM reporting unit. The estimate of ecoATM's fair value as of November 30, 2015, included the expected increase in our estimated future cash flows from the Gazelle acquisition. The expected future cash flows of our ecoATM reporting unit include key assumptions with inherent uncertainty which may change in future periods and may have a negative effect on the fair value resulting in potential future impairments, the most significant of which is our estimate of future cash flows predicated on estimated growth in kiosks, revenue and profitability measures. Additionally, fair value may be negatively impacted by changes in our strategy related to the ecoATM reporting unit and factors outside of our control such as increased competition from companies whose primary business consists of the purchase of used electronics and with companies in other businesses who also have buyback programs.

Excluding the impact of Gazelle on the fair value and carrying value of the ecoATM reporting unit, there have been no significant changes in our expectations for the ecoATM reporting unit from the June 30, 2015 valuation date, when the estimated fair value of the ecoATM reporting unit equaled its carrying value, to the November 30, 2015 annual measurement date, that indicated the carrying value of the ecoATM reporting unit exceeded its fair value as of November 30, 2015.

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Other Intangible Assets

The gross amount of our other intangible assets and the related accumulated amortization were as follows:

Dollars in thousands	Amortization	December 31,
	Period	2015			2014
Retailer relationships	5 - 10 years	$	53,295		$	53,295
Accumulated amortization		(27,212		)	(23,200		)
Retailer relationships, net		26,083			30,095
Developed technology	3 - 5 years	36,000			34,000
Accumulated amortization		(16,544		)	(9,633		)
Developed technology, net		19,456			24,367
Trade names	5 - 10 years	20,000			6,000
Accumulated amortization		(3,133		)	(1,700		)
Trade names, net		16,867			4,300
Other	1 - 40 years	10,800			10,800
Accumulated amortization		(6,109		)	(4,871		)
Other, net		4,691			5,929
Total intangible assets, net		$	67,097		$	64,691

Amortization expense was as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Retailer relationships	$	4,012		$	5,432		$	6,250
Developed technology	6,911			6,800			2,833
Trade names	1,433			1,200			500
Other	1,238			1,260			1,350
Total amortization of intangible assets	$	13,594		$	14,692		$	10,933
Less: amortization included in discontinued operations	(44		)	(38		)	(26		)
Total amortization of intangible assets from continuing operations	$	13,550		$	14,654		$	10,907

Assuming no future impairment, the expected future amortization as of December 31, 2015, is as follows:

Dollars in thousands	Retailer Relationships		Developed Technology		Trade Names		Other		Total
2016	$	4,012	$	7,467	$	2,600	$	1,081	$	15,160
2017	4,012		7,467		2,600		1,081		15,160
2018	4,012		4,522		2,100		964		11,598
2019	4,012		—		1,400		801		6,213
2020	4,012		—		1,400		407		5,819
Thereafter	6,023		—		6,767		357		13,147
Total expected amortization	$	26,083	$	19,456	$	16,867	$	4,691	$	67,097

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Note 7: Equity Method Investments

Redbox Instant^™ by Verizon

In February 2012, Redbox and Verizon Ventures IV LLC (“Verizon”), a wholly owned subsidiary of Verizon Communications Inc., entered into a Limited Liability Company Agreement (the “LLC Agreement”) and related arrangements. The LLC Agreement governed the relationship of the parties with respect to a joint venture, Redbox Instant by Verizon (the “Joint Venture”). Redbox initially acquired a 35.0% ownership interest in the Joint Venture and made an initial capital contribution of $14.0 million in cash in February 2012 subsequent to the formation of the Joint Venture. The following table summarizes Redbox's initial cash capital contribution and subsequent cash capital contributions representing its pro-rata share of requests made by the Joint Venture board of managers:

Dollars in thousands	Cash Contributions
2012	$	24,500
2013	28,000
2014	24,500
Total cash capital contributions	$	77,000

On October 19, 2014, the Company and Verizon entered into an agreement whereby we would withdraw from the Joint Venture effective October 20, 2014. Pursuant to the agreement, all of Redbox’s rights under the Joint Venture’s operating agreement were extinguished for a total payment of $16.8 million made to Redbox and no further capital contributions were required. The $16.8 million payment received was composed of an $11.8 million expense reimbursement payment to satisfy all outstanding amounts due and additional expenses incurred by Redbox inclusive of transition services performed for the Joint Venture to Redbox and a $5.0 million extinguishment payment which is included within Income (loss) from equity method investments within our Consolidated Statements of Comprehensive Income.

Other Equity Method Investments

We include our equity method investments within other long-term assets on our Consolidated Balance Sheets. As of December 31, 2015, our $0.7 million investment in Pursuant Health, Inc., formerly known as SoloHealth, Inc., representing approximately 10% ownership, was our only equity method investment.

Since we acquired ecoATM on July 23, 2013, the results of ecoATM operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment. See Note 14: Business Segments and Enterprise-Wide Information for more information.

Income (Loss) from Equity Method Investments and Summarized Financial Information

Income (loss) from equity method investments within our Consolidated Statements of Comprehensive Income is composed of the following:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Gain on previously held equity interest on ecoATM	$	—		$	—		$	68,376
Proportionate share of net loss of equity method investees:
Joint Venture	—			(25,793		)	(42,660		)
Pursuant Health and ecoATM	(800		)	(530		)	(3,313		)
Total proportionate share of net loss of equity method investees	(800		)	(26,323		)	(45,973		)
Amortization of difference in carrying amount and underlying equity in Joint Venture	—			(2,411		)	(2,475		)
Total income (loss) from equity method investments	$	(800	)	$	(28,734	)	$	19,928

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A summary of financial information for our equity method investees in the aggregate, as provided to us by the investees, is as follows:

Balance Sheets(1)	December 31,
Dollars in thousands	2015		2014
Current assets	$	3,457	$	3,408
Noncurrent assets	$	13,394	$	20,376
Current liabilities	$	5,888	$	7,321
Long-term liabilities	$	22,811	$	18,754

(1) Represents Pursuant Health, Inc. only.

Statement of Operations	Year Ended December 31,
Dollars in thousands	2015		2014		2013
Revenue	$	7,389	$	29,963	$	15,824
Cost of sales and service	$	10,129	$	68,732	$	25,092
Net loss from continuing operations	$	6,107	$	140,919	$	134,911

Note 8: Debt and Other Long-Term Liabilities

	Debt														Other Liabilities							Total
	Senior Notes						Credit Facility					Total Debt			Capital Lease Obligations			Asset retirement obligations		Other long-term liabilities
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2015:
Principal	$	350,000		$	258,908		$	136,875		$	140,500	$	886,283
Discount	(3,275		)	(3,029		)	(260		)	—		(6,564		)
Total	346,725			255,879			136,615			140,500		879,719			$	5,889		$	9,412	$	19,477	$	914,497
Less: current portion	—			—			(13,125		)	—		(13,125		)	(4,006		)	—		—		(17,131		)
Total long-term portion	$	346,725		$	255,879		$	123,490		$	140,500	$	866,594		$	1,883		$	9,412	$	19,477	$	897,366
Unamortized deferred financing fees(1)	$	495		$	1,054		$	—		$	2,300	$	3,849									$	3,849

	Debt														Other Liabilities							Total
	Senior Notes						Credit Facility					Total Debt			Capital Lease Obligations			Asset retirement obligations		Other long-term liabilities
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2014:
Principal	$	350,000		$	300,000		$	146,250		$	160,000	$	956,250
Discount	(4,296		)	(4,152		)	(335		)	—		(8,783		)
Total	345,704			295,848			145,915			160,000		947,467			$	15,391		$	13,576	$	17,651	$	994,085
Less: current portion	—			—			(9,390		)	—		(9,390		)	(11,026		)	—		—		(20,416		)
Total long-term portion	$	345,704		$	295,848		$	136,525		$	160,000	$	938,077		$	4,365		$	13,576	$	17,651	$	973,669
Unamortized deferred financing fees(1)	$	649		$	1,372		$	—		$	2,965	$	4,986									$	4,986

(1) Deferred financing fees are recorded in other long-term assets in our Consolidated Balance Sheets and are amortized on a straight line basis over the life of the related loan.

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Interest Expense

Dollars in thousands	Year Ended December 31,
	2015			2014		2013
Cash interest expense	$	45,507		$	41,562	$	25,289
Non-cash interest expense:
Amortization of debt discount	1,731			2,606		4,674
Amortization of deferred financing fees	1,030			1,510		1,720
Other	—			—		(550		)
Total non-cash interest expense	2,761			4,116		5,844
Total cash and non-cash interest expense	48,268			45,678		31,133
(Gain) loss from early extinguishment of debt	(5,854		)	2,018		6,013
Total interest expense	$	42,414		$	47,696	$	37,146

2019 Notes

On March 12, 2013, we entered into an indenture pursuant to which we issued $350.0 million principal amount of 6.000%Senior Notes due 2019 (the “2019 Notes”) at par for proceeds, net of expenses, of $343.8 million. The expenses were allocated between debt discount and deferred financing fees based on their nature. Each of our direct and indirect U.S. subsidiaries guarantees the 2019 Notes. As of December 31, 2015, we were in compliance with the covenants of the related indenture.

2021 Notes

On June 9, 2014, we entered into an indenture pursuant to which we issued $300.0 million principal amount of 5.875% Senior Notes due 2021 (the "2021 Notes") at par for proceeds, net of expenses, of $294.0 million. The expenses were allocated between debt discount and deferred financing fees based on their nature. Each of our direct and indirect U.S. subsidiaries guarantees the 2021 Notes.

During the second quarter of 2015, we registered the 2021 Notes and related guarantees under the Securities Act of 1933, as amended (the “Securities Act”) to allow holders to exchange the notes and related guarantees for the same principal amount of a new issue and related guarantees (collectively, the “Exchange Notes”) with substantially identical terms, except that the Exchange Notes are generally freely transferable under the Securities Act. The full principal amount of the 2021 Notes was exchanged for the Exchange Notes.

On December 15, 2015, we repurchased 41,092 Notes, or $41.1 million in face value of Notes, for $34.6 million in cash. The gain from early extinguishment of these Notes was approximately $5.9 million and is included in Interest expense, net on our Consolidated Statements of Comprehensive Income.

As of December 31, 2015, we were in compliance with the covenants of the related indenture.

Revolving Line of Credit and Term Loan

On June 24, 2014, we entered into the Third Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) providing for a senior secured credit facility (the "Credit Facility"). The Amended and Restated Credit Agreement amended and restated in its entirety the Second Amended and Restated Credit Agreement dated as of November 20, 2007 and amended and restated as of April 29, 2009 and as of July 15, 2011 and all amendments and restatements thereto. The credit facility provided under the previous credit agreement was replaced by the Credit Facility. As a result of this refinancing activity, we recorded a loss on the extinguishment of the previous credit agreement of $1.7 million in 2014 for certain previously capitalized and unamortized debt issuance costs. The loss on extinguishment is recorded within Interest expense, net in our Consolidated Statements of Comprehensive Income.

The Credit Facility consists of (a) a $150.0 million amortizing term loan (the “Term Loan”) and (b) a $600.0 millionrevolving line of credit (the “Revolving Line”), which includes (i) a $75.0 million sublimit for the issuance of letters of credit, (ii) a $50.0 million sublimit for swingline loans and (iii) a $75.0 million sublimit for loans in certain foreign currencies available to us and certain wholly owned Company foreign subsidiaries (the “Foreign Borrowers”). We may, subject to applicable conditions and subject to obtaining commitments from lenders, request an increase in the Revolving Line of up to$200.0 million in aggregate (the “Accordion”). The interest rate on amounts outstanding under the Credit Facility was 2.29% and 1.92% as of December 31, 2015 and December 31, 2014, respectively.

As of December 31, 2015, we were in compliance with the covenants of the Credit Facility.

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The Amended and Restated Credit Agreement requires principal amortization payments under the Term Loan as follows:

Dollars in thousands	Repayment Amount
2016	$	13,125
2017	15,000
2018	18,750
2019	90,000
Total	$	136,875

Convertible Debt

On September 2, 2014, our 4.0% Convertible Senior Notes (the “Convertible Notes”) matured. The Convertible Notes were convertible as of December 31, 2013. In 2014, we retired or settled upon maturity, a combined 51,148 Convertible Notes for total consideration of $51.1 million in cash and the issuance of 431,760shares of common stock. The amount by which total consideration exceeded the fair value of the Convertible Notes has been recorded as a reduction of stockholders’ equity. The loss from early extinguishment of the Convertible Notes was approximately $0.3 million and is recorded in Interest expense, net in our Consolidated Statements of Comprehensive Income.

Asset Retirement Obligation

We have entered into agreements with our partners to place kiosks in their stores. Upon contract terminations, we are obligated to remove the kiosks from the store locations and, accordingly, we recognize the estimated fair value of the liability under the long-term section of our liabilities in our Consolidated Balance Sheets.

Other Long-Term Liabilities

Included in other long-term liabilities were primarily tenant improvements related to our office building renovation in Oakbrook Terrace, Illinois; Bellevue, Washington; and San Diego, California as well as the related unrecognized tax benefits as follows:

Dollars in thousands	December 31,
	2015		2014
Tenant improvement and deferred rent and other	$	12,592	$	13,012
Unrecognized tax benefit	6,885		4,639
Total other long-term liabilities	$	19,477	$	17,651

Note 9: Repurchases of Common Stock

Board Authorization

On February 3, 2015, our Board of Directors approved an additional stock repurchase program of up to $250.0 million of our common stock plus the cash proceeds received from the exercise of stock options by our executives, non-employee directors and employees.

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Repurchases

Repurchased shares become a part of treasury stock. The shares tendered for tax withholding on vesting of restricted stock awards do not impact the repurchase program approved by our Board. The following tables present a summary of our 2015 authorized stock repurchase balance and repurchases made during the past three years:

Dollars in thousands	Board Authorization
Authorized repurchase - as of January 1, 2015	$	163,655
Additional board authorization	250,000
Proceeds from the exercise of stock options	2,552
Repurchase of common stock from open market	(159,800		)
Authorized repurchase - as of December 31, 2015	$	256,407

Repurchases made in the year ended December 31,	Number of Shares Repurchased	Average Price per Share (in dollars)		Total Purchase Price (in thousands)
2015	2,514,139	$	63.56	$	159,800
2014
Tender offer(1)	5,291,701	$	70.07	370,789
Open market	2,633,526	$	64.77	170,582
Total 2014	7,925,227	$	68.31	541,371
2013	3,306,433	$	58.98	195,004
Total	13,745,799	$	65.20	$	896,175

(1) Fees and expenses totaling $3.7 million associated with the tender offer do not impact the repurchase program approved by our Board, are excluded from the total purchase price shown here and were recorded as part of the cost of treasury stock in our Consolidated Balance Sheets.

Note 10: Share-Based Payments

We currently grant share-based awards to our employees, non-employee directors and consultants under our 2011 Incentive Plan (the “Plan”). The Plan permits the granting of stock options, restricted stock, restricted stock units, and performance-based restricted stock.

The following is the summary of grant information:

Shares in thousands	December 31, 2015
Unissued common stock reserved for issuance under all plans	1,034
Shares available for future grants	979

Certain information regarding our share-based payments is as follows:

	Year Ended December 31,
Dollars in thousands except per share data	2015		2014		2013
Share-based payments expense:
Share-based compensation - stock options	$	293	$	803	$	1,566
Share-based compensation - restricted stock	12,102		11,214		10,504
Share-based payments for content arrangements	4,982		1,367		4,761
Total share-based payments expense	$	17,377	$	13,384	$	16,831
Tax benefit on share-based payments expense	$	6,736	$	5,134	$	6,392
Per share weighted average grant date fair value of stock options granted	$	—	$	—	$	53.90
Per share weighted average grant date fair value of restricted stock granted	$	66.67	$	71.37	$	53.94
Total intrinsic value of stock options exercised	$	1,061	$	3,263	$	10,567
Grant date fair value of restricted stock vested	$	12,631	$	13,036	$	12,641

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	December 31, 2015
Dollars in thousands	Unrecognized Share-Based Payments Expense		Weighted-Average Remaining Life
Unrecognized share-based payments expense:
Share-based compensation - stock options	$	149	0.9 years
Share-based compensation - restricted stock	19,032		2.2 years
Share-based payments for content arrangements	1,090		0.8 years
Total unrecognized share-based payments expense	$	20,271

Share-Based Compensation

Stock options

Shares of common stock are issued upon exercise of stock options. The following table presents a summary of stock option activity for 2015:

Shares in thousands	Options		Weighted Average Exercise Price
Outstanding, December 31, 2014	128		$	52.59
Granted	—		$	—
Exercised	(49	)	$	52.10
Canceled, expired, or forfeited	(24	)	$	53.99
Outstanding, December 31, 2015	55		$	52.40

Certain information regarding stock options outstanding as of December 31, 2015, is as follows:

	Options
Shares and intrinsic value in thousands	Outstanding		Exercisable
Number	55		39
Weighted average per share exercise price	$	52.40	$	51.67
Aggregate intrinsic value	$	35	$	35
Weighted average remaining contractual term (in years)	6.33		6.09

Restricted stock and performance based restricted stock awards

Restricted stock awards are granted to eligible executives, non-employee directors and employees. Awards granted to employees and executives vest annually in equal installments overfour years. Non-employee director awards vest one year after the grant date. Performance-based restricted stock awards are granted to executives only, with established performance criteria approved by the Compensation Committee of the Board of Directors. The fair value of non-performance-based awards is based on the market price on the grant date. We estimate forfeitures for restricted stock awards and recognize share-based compensation expense for only those awards expected to vest.

Awards of performance-based restricted stock made prior to 2013, once earned, vest in equal installments overthree years from the date of grant. Awards of performance-based restricted stock made in and subsequent to 2013, once earned, vest in two installments over three years from the date of grant (65% of the award vests two years from the date of grant and the remaining 35% of the award vests three years from the date of grant). The restricted shares require no payment from the grantee. The fair value of performance-based awards is based on achieving specific performance conditions and is recognized over the vesting period.

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The following table presents a summary of restricted stock award activity for 2015:

Shares in thousands	Restricted Stock Awards		Weighted Average Grant Date Fair Value
Non-vested, December 31, 2014	609		$	62.35
Granted	352		$	66.67
Vested	(188	)	$	59.09
Forfeited	(217	)	$	65.26
Non-vested, December 31, 2015	556		$	65.86

Share-Based Payments for Content Arrangements

We have granted restricted stock as part of content license agreements with certain movie studios. The expense related to these agreements is included within direct operating expenses in our Consolidated Statements of Comprehensive Income and is adjusted based on the number of unvested shares and market price of our common stock each reporting period. See Note 16: Commitments and Contingencies for more information on changes in commitments to issue restricted stock for content license agreements.

Information related to the shares of restricted stock granted as part of these agreements as of December 31, 2015, is as follows:

Whole shares	Granted	Vested	Unvested
Sony(1)	243,348	243,348	—
Paramount(2)(3)	350,000	350,000	—

(1) Includes 25,000 shares granted and fully vested in the fourth quarter of 2015 due to a one-year contract extension executed in 2015.

(2) Includes 50,000 shares granted and fully vested in the first quarter of 2015 due to a one-year contract extension executed in 2015.

(3) Includes 95,000 shares that vested on January 1, 2015.

On October 16, 2015, Paramount elected to exercise its option to extend our existing content license agreement. This required us to issue 50,000 shares of additional restricted stock to Paramount during the first quarter of 2016, which we issued on January 4, 2016.

Rights to Receive Cash

As a part of the acquisition of ecoATM, we issued replacement awards for unvested restricted stock and options in ecoATM with rights to receive cash equal to the per share merger consideration for restricted stock and net of the exercise price for options. The replacement awards vest in accordance with the terms of the original replaced award. The fair value of the original and replacement awards amounted to $32.1 million, of which $1.4 million was attributed to pre-combination services rendered and included in the calculation of total consideration transferred. The replacement awards are considered liability classified as they represent rights to receive cash. Expense associated with the post-combination awards is recognized net of forfeitures, and cash payments are made in accordance with the awards' vesting schedule, generally on a monthly basis.

We recognized $4.4 million, $13.3 million and $8.7 million in expense associated with the issuance of rights to receive cash for the twelve months endedDecember 31, 2015, 2014 and 2013, respectively. The expected future recognition of expense associated with the rights to receive cash as of December 31, 2015 is as follows:

Dollars in thousands	Expected Expense
2016	$	1,868
2017	284
Remaining total expected expense	$	2,152

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Note 11: Restructuring

2015 Restructuring

During the first quarter of 2015, we recorded restructuring charges arising from the following activities:

• Discontinuing our Redbox operations in Canada. The disposal was completed on March 31, 2015. See Note 12: Discontinued Operations for further information;

• Reducing the size of our Redbox headquarters facility in Oakbrook Terrace, Illinois through early termination of operating leases for certain floors. We ceased using the office space on March 31, 2015, and the effective date of the early termination is July 31, 2016. Prior to exercising our early termination option, the leases had been scheduled to expire in July 2021; and

• Implementing actions to further align costs with revenues in our continuing operations primarily through workforce reductions across the Company and subleasing a floor of a corporate facility.

The restructuring liability for this workforce reduction was recorded in the first quarter of 2015 in accordance with ASC 420, consistent with management's approval and commitment to the restructuring plan in the first quarter of 2015, and the communication of those plan details to affected employees within that quarter.

During the fourth quarter of 2015, we recorded restructuring charges arising from the following additional activities:

• Discontinuing our SAMPLEit concept, which is recorded in our All Other reporting category. See Note 14: Business Segments and Enterprise-Wide Information for additional information; and

• Continuing to implement actions to further align costs with revenues in our continuing operations primarily through workforce reductions across the Company, a one-time payment to settle an outstanding purchase commitment, and vacating a floor of a corporate facility. See Note 16: Commitments and Contingenciesfor further information related to the purchase commitment.

We recorded the restructuring liabilities in the fourth quarter of 2015 under ASC 712, consistent with management's approval and commitment to the restructuring plan. We had a substantive plan in place, for purposes of ASC 712, based on the fact that the termination benefits to be paid to our employees were similar to the termination benefits historically paid by us, thereby enabling employees to determine the type and amount of benefits they would receive if they were involuntarily terminated. The restructuring liability represented our obligation related to our employees' rights to receive compensation attributable to services already rendered, which rights had already vested or accumulated. Due to the fact that management had approved and committed to the restructuring plan and based on historical experience, payment of the severance was probable and the amount was reasonably estimated.

We do not expect significant future restructuring charges related to our 2015 restructuring activities. The total amount incurred for restructuring, exclusive of asset impairments incurred by reportable segment (on an allocated basis) and expense type is as follows:

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	Year Ended December 31,
Dollars in thousands	2015
Redbox
Severance	$	4,236
Lease termination and related costs (excluding related asset impairments)	4,958
Purchase commitment settlement costs	7,021
Total Redbox restructuring costs	16,215
Coinstar
Severance	492
Lease termination and related costs (excluding related asset impairments)	100
Purchase commitment settlement costs	1,369
Total Coinstar restructuring costs	1,961
ecoATM
Severance	602
Lease termination and related costs (excluding related asset impairments)	—
Purchase commitment settlement costs	85
Total ecoATM restructuring costs	687
All Other
Severance	822
Lease termination and related costs (excluding related asset impairments)	2
Purchase commitment settlement costs	26
Total All Other restructuring costs	850
Total restructuring costs in continuing operations	19,713
Restructuring costs in discontinued operations	522
Total restructuring costs	$	20,235

During 2015, we recognized $27.7 million in charges in connection with our restructuring and related costs including $7.4 million in impairments of lease related assets, and $20.2 million in restructuring costs, which include severance, net lease termination costs and a one-time payment to settle an outstanding purchase commitment.

	Year Ended December 31,
Dollars in thousands	2015
Restructuring costs	$	20,235
Impairment of lease related assets (see Note 5)	7,440
Total restructuring and related costs	27,675
Less: restructuring costs included in discontinued operations	(522		)
Restructuring and related costs from continuing operations	$	27,153

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A reconciliation of the beginning and ending liability balance by expense type is as follows:

Dollars in thousands	Severance Expense			Lease Termination Costs			Other
Beginning Balance - January 1, 2015	$	—		$	—		$	—
Costs charged to expense(1)	6,284			5,138			8,813
Reclassification of deferred balances(2)	—			5,260			—
Costs paid or otherwise settled	(4,899		)	(5,407		)	(8,813		)
Ending Balance - December 31, 2015	$	1,385		$	4,991		$	—

(1) Other includes an $8.5 million one-time payment to settle an outstanding purchase commitment.

(2) Deferred rent liabilities related to the early lease termination that were reclassified to present the outstanding liability related to the terminated leases.

2013 Restructuring

During the fourth quarter of 2013, as a result of a comprehensive operational review, we committed to a restructuring plan intended to, among other things, better align our cost structure with revenue growth in our core businesses. As part of the plan, we discontinued the Rubi, Crisp Market, and Star Studio concepts (see Note 12: Discontinued Operations for further information). Also as part of the restructuring plan, we implemented actions to reduce costs in our continuing operations primarily through workforce reductions across the Company. The closure of all discontinued ventures and the workforce reductions were completed in 2014.

The restructuring liabilities for the workforce reductions were recorded in the fourth quarter of 2013 and in 2014 in accordance with ASC 420, consistent with management's approval and commitment to the restructuring plan, and the communication of plan details to affected employees.

The total amount incurred for restructuring, exclusive of asset impairments incurred by reportable segment (on an allocated basis) and expense type is as follows:

Dollars in thousands	Cumulative as of December 31, 2014		Year Ended December 31, 2014		Year Ended December 31, 2013
Redbox
Severance	$	4,305	$	534	$	3,771
Coinstar
Severance	747		23		724
Total restructuring costs in continuing operations	5,052		557		4,495
Restructuring costs in discontinued operations	2,899		590		2,309
Total restructuring costs	$	7,951	$	1,147	$	6,804

Note 12: Discontinued Operations

On January 23, 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the company's performance expectations. This represents a strategic shift which has a major effect on our operations as it represents a significant geographical area for our Redbox segment and the losses generated were significant to our total operations. On March 31, 2015, we completed the disposal of the Redbox Canada operations. As a result, we updated certain estimates used in the preparation of our financial statements and the remaining value of the content library and certain capitalized property and equipment consisting primarily of installation costs were amortized over the wind-down period ending March 31, 2015. We have reclassified the results of Redbox Canada to discontinued operations for all periods presented in our Consolidated Statements of Comprehensive Income.

In addition to Redbox Canada, during 2013, we discontinued certain new ventures. See below for additional information.

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The following table sets forth the components of discontinued operations included in our Consolidated Statements of Comprehensive Income:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Redbox Canada revenue	$	1,972		$	11,417		$	6,816
Certain new ventures revenue	—			100			4,399
Total revenue	$	1,972		$	11,517		$	11,215
Redbox Canada loss before income tax	$	(13,605	)	$	(23,707	)	$	(19,830	)
Certain new ventures loss before income tax	—			(1,259		)	(54,395		)
Total loss before income tax:	(13,605		)	(24,966		)	(74,225		)
Redbox Canada income tax benefit	8,496			6,416			5,233
Certain new ventures income tax benefit	—			491			21,096
Total income tax benefit	8,496			6,907			26,329
Redbox Canada loss, net of tax	(5,109		)	(17,291		)	(14,597		)
Certain new ventures loss, net of tax	—			(768		)	(33,299		)
Total loss from discontinued operations, net of tax	$	(5,109	)	$	(18,059	)	$	(47,896	)

Redbox Canada

The disposition and operating results of Redbox Canada are presented in discontinued operations in our Consolidated Statements of Comprehensive Income for all periods presented. The following table sets forth the components of discontinued operations included in our Consolidated Statements of Comprehensive Income:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Major classes of line items constituting pretax loss of discontinued operations:
Revenue	$	1,972		$	11,417		$	6,816
Direct operating	4,533			20,027			18,278
Marketing	112			2,947			2,175
Research and development	—			—			2
General and administrative	117			1,078			3,088
Restructuring and related costs	522			—			—
Depreciation and other	5,857			7,354			2,760
Amortization of intangible assets	44			38			26
Other expense, net	(4,392		)	(3,680		)	(317		)
Pretax loss of discontinued operations related to major classes of pretax loss	(13,605		)	(23,707		)	(19,830		)
Income tax benefit(1)	8,496			6,416			5,233
Net loss on discontinued operations	$	(5,109	)	$	(17,291	)	$	(14,597	)

(1) The income tax benefit for 2015 includes a benefit on the rate differential between the U.S. and Canada.

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Significant operating and investing cash flows of Redbox Canada were as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Net loss on discontinued operations	$	(5,109	)	$	(17,291	)	$	(14,597	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Depreciation and amortization	5,901			7,392			2,786
Content library	3,328			(787		)	(410		)
Prepaid and other current assets	1,329			(293		)	(516		)
Accounts payable	(2,663		)	627			644
Accrued payables to retailers	(155		)	(175		)	247
Other accrued liabilities	(806		)	(122		)	506
Net cash flows from operating activities	$	1,825		$	(10,649	)	$	(11,340	)
Investing activities:
Purchase of property, plant and equipment	(292		)	(5,494		)	(9,330		)
Total cash flows used in investing activities	$	(292	)	$	(5,494	)	$	(9,330	)

Discontinuation of Certain New Ventures

During 2013, we discontinued four new venture concepts; Rubi, Crisp Market, Orango, and Star Studio. As a result, for each concept we estimated the fair value of assets held utilizing a cash flow approach. For each of the concepts and for certain shared service assets used for the new ventures, we estimated the fair value of the assets was zero and recorded impairment charges for each concept. Total asset impairment charges related to the concepts and relevant shared service assets were recorded in 2013 as follows:

Dollars in thousands	Impairment Expense
Rubi	$	21,317
Orango	5,551
Crisp Market	289
Star Studio	2,786
Corporate assets utilized for discontinued concepts	2,789
Total impairment expense	$	32,732

We completed the wind-down process of all discontinued ventures in 2014. The results of the discontinued ventures and associated impairment and restructuring charges, net of tax, are recorded within Loss from discontinued operations, net of tax in our Consolidated Statements of Comprehensive Income (see Note 11: Restructuring). The continuing cash flows from these operations after discontinuation are insignificant and are not segregated from cash flows from continuing operations in all periods presented in our Consolidated Statements of Cash Flows.

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Note 13: Earnings Per Share

Beginning in the first quarter of 2015, we began applying the two-class method of calculating basic and diluted earnings per share (the “Two-Class Method”) as it became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards as a percentage of total common shares outstanding.

The Two-Class Method is an earnings allocation formula that treats a participating security, as having rights to earnings that otherwise would have been available to common shareholders and assumes all earnings for the period are distributed. Our unvested service-based restricted stock awards granted are participating securities as they entitle recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to holders of common stock.

Our calculation of basic and diluted earnings per share is as follows:

	Year Ended December 31,
In thousands, except per share data	2015			2014			2013
Numerator
Income from continuing operations	$	49,446		$	124,677		$	222,688
Loss from discontinued operations, net of tax	(5,109		)	(18,059		)	(47,896		)
Net income	$	44,337		$	106,618		$	174,792
Income from continuing operations	$	49,446		$	124,677		$	222,688
Dividends and undistributed income allocated to participating shares	(1,329		)	(3,929		)	(5,473		)
Income from continuing operations to common shares - basic	48,117			120,748			217,215
Effect of reallocating undistributed income from continuing operations to participating shares	1			58			179
Income from continuing operations to common shares - diluted	$	48,118		$	120,806		$	217,394
Denominator
Weighted average common shares - basic	17,467			20,192			27,216
Dilutive effect of share-based payment awards	20			81			235
Dilutive effect of convertible debt	—			230			718
Weighted average common shares - diluted(1)	17,487			20,503			28,169
Basic earnings (loss) per common share:
Continuing operations	$	2.75		$	5.98		$	7.98
Discontinued operations	(0.29		)	(0.89		)	(1.76		)
Basic earnings per common share	$	2.46		$	5.09		$	6.22
Diluted earnings (loss) per common share:
Continuing operations	$	2.75		$	5.89		$	7.72
Discontinued operations	(0.29		)	(0.88		)	(1.70		)
Diluted earnings per common share	$	2.46		$	5.01		$	6.02
Stock options and share-based awards not included in diluted EPS calculation because their effect would have be antidilutive	7			11			13

(1) Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive than the calculation using the treasury stock method.

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Note 14: Business Segments and Enterprise-Wide Information

Management, including our chief operating decision maker, who is our CEO, evaluates the performances of our business segments primarily on segment revenue and segment operating income (loss) before depreciation, amortization and other, and share-based compensation granted to executives, non-employee directors and employees (“segment operating income (loss)”). Segment operating income (loss) contains internally allocated costs of our shared service support functions, including but not limited to, corporate executive management, business development, sales, finance, legal, human resources, information technology and risk management. We also review depreciation and amortization allocated to each segment. Share-based payments expense related to share-based compensation granted to executives, non-employee directors and employees and expense related to the rights to receive cash issued in connection with our acquisition of ecoATM are not allocated to our segments and are included in the Corporate Unallocated column in the analysis and reconciliation below; however, share-based payments expense related to our content arrangements with certain movie studios has been allocated to our Redbox segment and is included within direct operating expenses. Our performance evaluation does not include segment assets.

Changes in our Organizational Structure

We regularly assess the performance of our concepts to determine whether continued funding or other alternatives are appropriate and as a result, we discontinued operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit did not represent a major component of our operations or financial results, the results of SAMPLEit did not qualify to be reported as a discontinued operation and remain in our All Other reporting category.

During the first quarter of 2015, we added ecoATM, our electronic device recycling business, as a separate reportable segment. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts are now included in our All Other reporting category in the reconciliation below, as they do not meet quantitative thresholds to be reported as a separate segment. All goodwill previously allocated to the New Ventures segment has been allocated to the ecoATM segment. See Note 6: Goodwill and Other Intangible Assetsfor further information.

Results of operations for Gazelle from the acquisition date, November 10, 2015, are included in our ecoATM segment. See Note 3: Business Combinationsfor further information.

On July 23, 2013, we completed the acquisition of ecoATM. Prior to July 23, 2013 we held a non-controlling equity interest in ecoATM and reported our share of ecoATM's operating results in loss from equity method investments in our Consolidated Statements of Comprehensive Income. Subsequent to our acquisition of ecoATM on July 23, 2013, the assets acquired and liabilities assumed, as well as the results of operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment.

Comparability of Segment Results

We have recast prior period results for the following:

• Discontinued operations, consisting of our Redbox operations in Canada which we shut down during the first quarter of 2015. See Note 12: Discontinued Operationsfor further information; and

• The addition of our ecoATM segment and our All Other reporting category, which we added during the first quarter of 2015.

Our analysis and reconciliation of our segment information to the consolidated financial statements that follows covers our results of operations, which consists of our Redbox, Coinstar and ecoATM segments, Corporate Unallocated expenses and our All Other reporting category. All Other includes the results of other self-service concepts, which we regularly assess to determine whether continued funding or other alternatives are appropriate.

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Dollars in thousands
Year Ended December 31, 2015	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,760,899		$	318,611		$	113,558		$	143		$	—		$	2,193,211
Expenses:
Direct operating	1,213,744			159,211			113,141			4,431			2,561			1,493,088
Marketing	19,804			5,566			8,481			1,128			695			35,674
Research and development	—			—			5,545			(84		)	1,737			7,198
General and administrative	129,013			31,561			10,875			7,188			11,756			190,393
Restructuring and related costs (Note 11)	23,540			2,076			687			850			—			27,153
Goodwill impairment (Note 6)	—			—			85,890			—			—			85,890
Segment operating income (loss)	374,798			120,197			(111,061		)	(13,370		)	(16,749		)	353,815
Less: depreciation and amortization	(118,902		)	(31,871		)	(26,382		)	(7,785		)	—			(184,940		)
Operating income (loss)	255,896			88,326			(137,443		)	(21,155		)	(16,749		)	168,875
Loss from equity method investments, net	—			—			—			—			(800		)	(800		)
Interest expense, net	—			—			—			—			(42,353		)	(42,353		)
Other, net	—			—			—			—			(2,657		)	(2,657		)
Income (loss) from continuing operations before income taxes	$	255,896		$	88,326		$	(137,443	)	$	(21,155	)	$	(62,559	)	$	123,065

Dollars in thousands
Year Ended December 31, 2014	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,881,718		$	315,628		$	94,187		$	53		$	—		$	2,291,586
Expenses:
Direct operating	1,318,509			161,214			92,182			2,821			6,585			1,581,311
Marketing	20,969			6,346			3,513			1,272			3,193			35,293
Research and development	120			531			5,691			2,854			3,851			13,047
General and administrative	135,554			26,989			12,773			3,522			11,658			190,496
Restructuring and related costs (Note 11)	534			23			—			—			—			557
Segment operating income (loss)	406,032			120,525			(19,972		)	(10,416		)	(25,287		)	470,882
Less: depreciation and amortization	(149,236		)	(35,471		)	(17,031		)	(740		)	—			(202,478		)
Operating income (loss)	256,796			85,054			(37,003		)	(11,156		)	(25,287		)	268,404
Loss from equity method investments, net	—			—			—			—			(28,734		)	(28,734		)
Interest expense, net	—			—			—			—			(47,644		)	(47,644		)
Other, net	—			—			—			—			(1,185		)	(1,185		)
Income (loss) from continuing operations before income taxes	$	256,796		$	85,054		$	(37,003	)	$	(11,156	)	$	(102,850	)	$	190,841

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Dollars in thousands
Year Ended December 31, 2013	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,967,715		$	300,218		$	31,824		$	28		$	—		$	2,299,785
Expenses:
Direct operating	1,365,368			158,562			27,271			2,162			3,636			1,556,999
Marketing	20,835			6,244			938			651			1,559			30,227
Research and development	76			6,962			2,772			1,897			1,375			13,082
General and administrative	160,863			25,220			7,868			7,683			14,164			215,798
Restructuring and related costs (Note 11)	3,771			724			—			—			—			4,495
Segment operating income (loss)	416,802			102,506			(7,025		)	(12,365		)	(20,734		)	479,184
Less: depreciation and amortization	(159,851		)	(33,921		)	(6,077		)	(459		)	—			(200,308		)
Operating income (loss)	256,951			68,585			(13,102		)	(12,824		)	(20,734		)	278,876
Loss from equity method investments, net	—			—			—			—			19,928			19,928
Interest expense, net	—			—			—			—			(32,807		)	(32,807		)
Other, net	—			—			—			—			(3,599		)	(3,599		)
Income (loss) from continuing operations before income taxes	$	256,951		$	68,585		$	(13,102	)	$	(12,824	)	$	(37,212	)	$	262,398

Significant Retailer Relationships

The following retailers accounted for 10% or more of our consolidated revenue:

	Year Ended December 31,
	2015		2014		2013
Wal-Mart Stores Inc.	16.6	%	15.5	%	15.2	%
Walgreen Co.	13.4	%	13.8	%	14.7	%
The Kroger Company	9.8	%	9.8	%	10.0	%

Revenue and Long-lived Assets by Geographic Location

Revenue is allocated to geographic locations based on the location of the kiosk. Revenue by geographic location was as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	2,145,887	$	2,242,753	$	2,254,790
All other	47,324		48,833		44,995
Total revenue	$	2,193,211	$	2,291,586	$	2,299,785

Long-lived assets by geographic location were as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	848,450	$	1,027,271	$	1,140,224
All other	14,133		33,426		38,406
Total long-lived assets	$	862,583	$	1,060,697	$	1,178,630

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Note 15: Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. To measure fair value, we use a three-tier valuation hierarchy based upon observable and non-observable inputs:

• Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities;

• Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; or

• Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.

The factors or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Assets and Liabilities Measured and Reported at Fair Value on a Recurring Basis

The following table presents our financial assets and liabilities that are measured and reported at fair value in our Consolidated Balance Sheets on a recurring basis, by level within the fair value hierarchy (in thousands):

Fair Value at December 31, 2015	Level 1		Level 2		Level 3
Money market demand accounts and investment grade fixed income securities	$	2,743	$	—	$	—
Fair Value at December 31, 2014	Level 1		Level 2		Level 3
Money market demand accounts and investment grade fixed income securities	$	916	$	—	$	—

Money Market Demand Accounts and Investment Grade Fixed Income Securities

We determine fair value for our money market demand accounts and investment grade fixed income securities based on quoted market prices. The fair value of these assets is included in cash and cash equivalents on our Consolidated Balance Sheets.

Assets and Liabilities Measured and Reported at Fair Value on a Nonrecurring Basis

We recognize or disclose the fair value of certain assets such as non-financial assets, primarily long-lived assets, goodwill, intangible assets and certain other assets in connection with impairment evaluations. All of our nonrecurring valuations use significant unobservable inputs and therefore fall under Level 3 of the fair value hierarchy.

For more information regarding the goodwill impairment charge recognized in 2015, and the related fair value, see Note 6: Goodwill and Other Intangible Assets.

Notes Receivable

On June 9, 2011, we completed the sale transaction of the Money Transfer Business to Sigue Corporation (“Sigue”). We received $19.5 million in cash and a note receivable of $29.5 million (the “Sigue Note”). In December 2011, as part of the sale transaction, we were required to provide Sigue with an additional loan of $4.0 million under terms consistent with the Sigue Note. We estimated the fair value of the Sigue Note based on the future note payments discounted at a market rate for similar risk profile companies, approximately 18.0%, which reflected our best estimate of default risk, and was not an exit price based measure of fair value or the stated value on the face of the Sigue Note. We evaluated the Sigue Note for collectability on a quarterly basis. Our evaluation at September 30, 2013 included consideration of ongoing discussions surrounding early payment on the note and certain indemnification obligations we have previously undertaken, as a result of our evaluation we did not record interest income on the note and also recorded a charge of $2.8 million against the note balance to arrive at a carrying value which approximated its estimated fair value. During the fourth quarter of 2013, we received $24.8 million in cash from Sigue for full settlement of the Sigue Note, interest and a release of certain indemnification claims. We recorded a benefit of $2.5 million from the release of indemnification related reserves.

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Fair Value of Other Financial Instruments

The carrying value of our term loans approximates their fair value and falls under Level 2 of the fair value hierarchy.

We estimated the fair value of our 2019 Notes and 2021 Notes outstanding using quoted market prices by independent dealers. The estimated fair value of our 2019 Notes and 2021 Notes was approximately $312.0 million and $213.0 million at December 31, 2015, and $350.0 million and $300.0 million at December 31, 2014, respectively. The fair value estimate of our senior unsecured notes falls under Level 2 of the fair value hierarchy. We have reported the carrying value, face value less the unamortized debt discount, of our senior unsecured notes, issued at par, in our Consolidated Balance Sheets.

Note 16: Commitments and Contingencies

Lease Commitments

Operating Leases

We lease our corporate administrative, marketing, and product development facilities in Bellevue, Washington under operating leases that expire December 31, 2019.

We lease our Redbox facility in Oakbrook Terrace, Illinois under an operating lease that expires on July 31, 2021. Under certain circumstances, we have the ability to extend the lease for a five-year period, rent additional office space under a right of first offer and refusal and have the option to terminate the lease in July 2016. Under the terms of the lease, we are responsible for certain tax, construction and operating costs associated with the rented space. We early terminated our operating lease of certain floors of our Redbox headquarters and recognized the fair value of the ongoing lease payments and other related costs through the effective date of termination, July 31, 2016, as of the cease use date, March 31, 2015. See Note 11: Restructuring for additional information;

We entered into a new operating lease of 16,085 square feet of office space for Redbox in Woodland Hills, California which expires May 31, 2022.

We lease our ecoATM facility in San Diego, California. The lease for this space will expire on August 10, 2025. Additionally, with the acquisition of Gazelle in the fourth quarter of 2015, we acquired facilities in Boston, Massachusetts and Louisville, Kentucky. The leases for these spaces will expire on November 30, 2020 and February 28, 2018, respectively.

Rent expense, net of sublease income under our operating lease agreements was $18.0 million, $16.8 million and $12.3 million during 2015, 2014 and 2013, respectively.

Capital Leases

We lease automobiles and computer equipment under capital leases expiring at various dates through 2022. We assess these leases as they come due as to whether we should purchase, enter into new capital leases, or enter into operating leases.

Assets held under capital leases are included in property and equipment, net on the Consolidated Balance Sheets and include the following:

Dollars in thousands	December 31,
	2015			2014
Gross property and equipment	$	26,394		$	41,336
Accumulated depreciation	(20,735		)	(26,831		)
Net property and equipment	$	5,659		$	14,505

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As of December 31, 2015, our future minimum lease payments, net of sublease income are as follows:

Dollars in thousands	Capital Leases			Operating Leases(1)
2016	$	4,144		$	18,969
2017	1,011			13,445
2018	429			10,215
2019	305			7,986
2020	209			4,936
Thereafter	123			7,132
Total minimum lease commitments	6,221			62,683
Less: sublease income	—			(1,332		)
Total minimum lease commitments, net	6,221			$	61,351
Less: amounts representing interest	(332		)
Present value of capital lease obligations	5,889
Less: Current portion of capital lease obligations	(4,006		)
Long-term portion of capital lease obligations	$	1,883

(1) Includes all operating leases having an initial or remaining non-cancelable lease term in excess of one year.

Purchase Commitments

Pursuant to the manufacturing and services agreement entered into as part of the NCR Asset Acquisition, Outerwall, Redbox or an affiliate were committed to purchase goods and services from NCR for a period of five years from June 22, 2012. At the end of the five-year period, if the aggregate amount paid in margin to NCR for goods and services delivered were to equal less than $25.0 million, Outerwall was to pay NCR the difference between such aggregate amount and $25.0 million. We made purchases in 2015, 2014 and 2013 that reduced this commitment by $0.4 million, $2.1 million and $7.1 million, respectively. During the fourth quarter of 2015, we made a one-time payment of $8.5 million in cash to satisfy all outstanding obligations related to, and to effectively settle, our remaining purchase commitment of $15.4 million established by the manufacturing and services agreement. The one-time payment was recognized as restructuring and related costs in our Consolidated Statements of Comprehensive Income.

We have entered into certain miscellaneous purchase agreements, primarily related to purchases of equipment, which resulted in total purchase commitments of $24.5 million as of December 31, 2015.

Content License Agreements

On January 21, 2016, Redbox entered into an amendment to the existing agreement with Universal Home Entertainment LLC (“Universal”), extending the agreement through December 31, 2017. See Note 21: Subsequent Eventsin our Notes to Consolidated Financial Statements for additional information.

On October 16, 2015, Paramount elected to exercise its option to extend our existing content license agreement. This extended the license period through December 31, 2016, with no further options to renew, and required us to issue 50,000 shares of additional restricted stock to Paramount during the first quarter of 2016, which we issued on January 4, 2016.

On July 14, 2015, Sony elected to exercise its option to extend our existing content license agreement. This extended the license period through September 30, 2016, with no further options to renew, and required us to issue 25,000 shares of additional restricted stock to Sony during the fourth quarter of 2015, which we issued on October 2, 2015.

On June 5, 2015, Redbox entered into an amendment to the existing April 22, 2010, agreement with Twentieth Century Fox Home Entertainment LLC (“Fox”) that maintains a 28-day window on Blu-ray Disc and DVD titles through June 30, 2017, and includes a revenue sharing arrangement between Redbox and Fox.

On March 26, 2015, we entered into a revenue sharing agreement with Warner Home Video, a division of Warner Bros. Home Entertainment Inc., (the “Warner Agreement”) under which Redbox agreed to license minimum quantities of theatrical and direct-to-video titles for rental through March 31, 2017. The Warner Agreement maintains a 28-day window on such titles.

94

We have entered into certain license agreements to obtain content for movie and video game rentals. A summary of the estimated movie commitments in relation to these agreements as of December 31, 2015, is presented in the following table:

Dollars in thousands	December 31,
	Total		2016		2017
Total estimated movie commitments(1)	$	448,718	$	381,275	$	67,443

(1) Subsequent to year end and not included in this table, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. See Note 21: Subsequent Events for additional information.

General terms of our content license agreements with studios are as follows as of December 31, 2015:

Studio	End Date		Release Date
Fox	6/30/2017		Delay	(1)
Sony	9/30/2016		Day & Date	(2)
Paramount	12/31/2016		Day & Date	(2)
Warner	3/31/2017		Delay	(1)
Lionsgate	9/30/2016	(3)	Day & Date	(2)
Universal	12/31/2015	(4)	Delay	(1)

(1) Content licensed under the agreement is available for rental after a certain number of days following the retail release.

(2) Content licensed under the agreement is available for rental on the same day and date as the retail release.

(3) Agreement extends the term of the arrangement automatically for an additional year under certain conditions.

(4) Subsequent to year end, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. See Note 21: Subsequent Events for additional information.

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	December 31,
	Total		2016		2017		2018
Redbox	$	2,365	$	1,711	$	523	$	131

Letters of Credit

As of December 31, 2015, we had five irrevocable standby letters of credit that totaled $6.5 million. These standby letters of credit, which expire at various times through November2016, are used to collateralize certain obligations to third parties. As of December 31, 2015, no amounts were outstanding under these standby letter of credit agreements.

95

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 alleged 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 complaint. In November 2011, the plaintiff moved for class certification, and Redbox moved for summary judgment. The court denied Redbox's motion for summary judgment in February 2012. The plaintiff filed an amended complaint on April 19, 2012, and an amended motion for class certification on June 5, 2012. The court denied Redbox's motion to dismiss the amended complaint. The amended class certification motion was briefed and argued. At the hearing on plaintiff's amended motion for class certification, the plaintiff dismissed all claims but two and is pursuing only her claims under the Illinois Rental Purchase Agreement Act and the Illinois Automatic Contract Renewal Act. On May 21, 2013, the court denied plaintiff's amended class action motion. On January 29, 2014, the Illinois Supreme Court denied plaintiff’s petition for leave to appeal the trial court’s denial of class certification. Redbox has moved to dismiss all remaining claims on mootness grounds, and the Court granted Redbox’s motion on December 11, 2014. The plaintiffs appealed on January 7, 2015. Oral argument was held November 10, 2015. The Appellate Court affirmed the trial court’s rulings on January 11, 2016. We continue to believe that the claims against us are without merit and intend to defend ourselves vigorously in this matter should plaintiff seek further appellate review. 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.

Other Contingencies

During the year ended December 31, 2013, we resolved a previously disclosed loss contingency related to a supply agreement and recorded a benefit of $11.4 million in the direct operating line item in our Consolidated Statements of Comprehensive Income.

96

Note 17: Guarantor Subsidiaries

Certain of our wholly-owned subsidiaries have, jointly and severally, fully and unconditionally guaranteed the 2019 Notes and 2021 Notes. Pursuant to SEC regulations, we have presented in columnar format the condensed consolidating financial information for Outerwall Inc., the guarantor subsidiaries on a combined basis, and all non-guarantor subsidiaries on a combined basis in the following tables:

CONSOLIDATING BALANCE SHEETS
	As of December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries		Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	160,167		$	19,372	$	43,010	$	—		$	222,549
Accounts receivable, net of allowances	3,983			33,269		1,212		—			38,464
Content library	—			188,490		—		—			188,490
Prepaid expenses and other current assets	17,720			33,049		599		—			51,368
Intercompany receivables	35,654			527,996		426		(564,076		)	—
Total current assets	217,524			802,176		45,247		(564,076		)	500,871
Property and equipment, net	97,659			204,081		14,273		—			316,013
Deferred income taxes	—			—		2,606		—			2,606
Goodwill and other intangible assets, net	249,703			290,811		—		—			540,514
Other long-term assets	4,596			1,293		167		—			6,056
Investment in related parties	921,456			27,798		—		(949,254		)	—
Total assets	$	1,490,938		$	1,326,159	$	62,293	$	(1,513,330	)	$	1,366,060
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	16,127		$	167,694	$	189	$	—		$	184,010
Accrued payable to retailers	71,947			30,157		12,994		—			115,098
Other accrued liabilities	57,025			82,401		2,011		—			141,437
Current portion of long-term debt and other long-term liabilities	16,832			—		299		—			17,131
Intercompany payables	459,789			85,487		18,800		(564,076		)	—
Total current liabilities	621,720			365,739		34,293		(564,076		)	457,676
Long-term debt and other long-term liabilities	877,325			19,882		159		—			897,366
Deferred income taxes	13,965			19,083		44		—			33,092
Total liabilities	1,513,010			404,704		34,496		(564,076		)	1,388,134
Commitments and contingencies
Stockholders’ Equity:
Preferred stock	—			—		—		—			—
Common stock	599,675			252,727		4,636		(371,875		)	485,163
Treasury stock	(1,151,063		)	—		3,000		(3,000		)	(1,151,063		)
Retained earnings	530,140			668,728		18,963		(574,379		)	643,452
Accumulated other comprehensive income (loss)	(824		)	—		1,198		—			374
Total stockholders’ equity (deficit)	(22,072		)	921,455		27,797		(949,254		)	(22,074		)
Total liabilities and stockholders’ equity	$	1,490,938		$	1,326,159	$	62,293	$	(1,513,330	)	$	1,366,060

97

CONSOLIDATING BALANCE SHEETS
	As of December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	180,889		$	17,939		$	43,868		$	—		$	242,696
Accounts receivable, net of allowances	3,203			43,874			1,513			—			48,590
Content library	—			176,490			3,631			—			180,121
Prepaid expenses and other current assets	14,884			23,923			1,012			—			39,819
Intercompany receivables	40,762			467,181			—			(507,943		)	—
Total current assets	239,738			729,407			50,024			(507,943		)	511,226
Property and equipment, net	133,923			263,412			31,133			—			428,468
Deferred income taxes	—			—			11,363			—			11,363
Goodwill and other intangible assets, net	249,717			374,281			—			—			623,998
Other long-term assets	6,665			1,231			335			—			8,231
Investment in related parties	917,234			(5,114		)	—			(912,120		)	—
Total assets	$	1,547,277		$	1,363,217		$	92,855		$	(1,420,063	)	$	1,583,286
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	12,899		$	153,260		$	2,474		$	—		$	168,633
Accrued payable to retailers	69,189			42,977			14,124			—			126,290
Other accrued liabilities	59,770			74,536			2,820			—			137,126
Current portion of long-term debt and other long-term liabilities	20,020			—			396			—			20,416
Intercompany payables	309,932			121,015			76,996			(507,943		)	—
Total current liabilities	471,810			391,788			96,810			(507,943		)	452,465
Long-term debt and other long-term liabilities	949,588			22,946			1,135			—			973,669
Deferred income taxes	28,500			31,249			25			—			59,774
Total liabilities	1,449,898			445,983			97,970			(507,943		)	1,485,908
Commitments and contingencies
Stockholders’ Equity:
Common stock	588,105			225,729			12,393			(352,635		)	473,592
Treasury stock	(996,293		)	—			—			—			(996,293		)
Retained earnings	506,360			691,505			(17,991		)	(559,485		)	620,389
Accumulated other comprehensive income (loss)	(793		)	—			483			—			(310		)
Total stockholders’ equity	97,379			917,234			(5,115		)	(912,120		)	97,378
Total liabilities and stockholders’ equity	$	1,547,277		$	1,363,217		$	92,855		$	(1,420,063	)	$	1,583,286

98

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	271,430		$	1,874,457		$	47,324		$	—		$	2,193,211
Expenses:
Direct operating	143,429			1,328,269			21,390			—			1,493,088
Marketing	6,485			28,916			273			—			35,674
Research and development	(83		)	7,281			—			—			7,198
General and administrative	47,699			142,012			682			—			190,393
Restructuring and related costs	2,926			24,227			—			—			27,153
Depreciation and other	32,643			134,522			4,225			—			171,390
Amortization of intangible assets	14			13,536			—			—			13,550
Goodwill impairment	—			85,890			—			—			85,890
Total expenses	233,113			1,764,653			26,570			—			2,024,336
Operating income	38,317			109,804			20,754			—			168,875
Other income (expense), net:
Loss from equity method investments, net	(800		)	—			—			—			(800		)
Interest income (expense)	30,177			(72,164		)	(366		)	—			(42,353		)
Other, net	15,273			1,354			(19,284		)	—			(2,657		)
Total other income (expense), net	44,650			(70,810		)	(19,650		)	—			(45,810		)
Income from continuing operations before income taxes	82,967			38,994			1,104			—			123,065
Income tax expense	(31,603		)	(41,785		)	(231		)	—			(73,619		)
Income (loss) from continuing operations	51,364			(2,791		)	873			—			49,446
Income (loss) from discontinued operations, net of tax	640			(28,068		)	22,319			—			(5,109		)
Equity in income (loss) of subsidiaries	(7,667		)	23,192			—			(15,525		)	—
Net income (loss)	44,337			(7,667		)	23,192			(15,525		)	44,337
Foreign currency translation adjustment(1)	(31		)	—			715			—			684
Comprehensive income (loss)	$	44,306		$	(7,667	)	$	23,907		$	(15,525	)	$	45,021

(1) Foreign currency translation adjustment had no tax effect in 2015.

99

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	266,848		$	1,975,905		$	48,833		$	—		$	2,291,586
Expenses:
Direct operating	142,472			1,415,132			23,707			—			1,581,311
Marketing	7,227			27,631			435			—			35,293
Research and development	3,456			9,591			—			—			13,047
General and administrative	39,412			150,211			873			—			190,496
Restructuring and related costs	23			534			—			—			557
Depreciation and other	35,155			148,217			4,452			—			187,824
Amortization of intangible assets	1,433			13,221			—			—			14,654
Total expenses	229,178			1,764,537			29,467			—			2,023,182
Operating income	37,670			211,368			19,366			—			268,404
Other income (expense), net:
Loss from equity method investments, net	(530		)	(28,204		)	—			—			(28,734		)
Interest income (expense), net	(48,007		)	572			(209		)	—			(47,644		)
Other, net	14,077			1,334			(16,596		)	—			(1,185		)
Total other income (expense), net	(34,460		)	(26,298		)	(16,805		)	—			(77,563		)
Income from continuing operations before income taxes	3,210			185,070			2,561			—			190,841
Income tax expense	(618		)	(64,989		)	(557		)	—			(66,164		)
Income from continuing operations	2,592			120,081			2,004			—			124,677
Loss from discontinued operations, net of tax	(803		)	(874		)	(16,382		)	—			(18,059		)
Equity in income (loss) of subsidiaries	104,829			(14,378		)	—			(90,451		)	—
Net income (loss)	106,618			104,829			(14,378		)	(90,451		)	106,618
Foreign currency translation adjustment(1)	368			—			89			—			457
Comprehensive income (loss)	$	106,986		$	104,829		$	(14,289	)	$	(90,451	)	$	107,075

(1) Foreign currency translation adjustment had no tax effect in 2014.

100

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	255,251		$	1,999,539		$	44,995		$	—		$	2,299,785
Expenses:
Direct operating	138,859			1,394,932			36,155			(12,947		)	1,556,999
Marketing	6,540			23,269			418			—			30,227
Research and development	8,973			4,111			(2		)	—			13,082
General and administrative	33,023			169,099			721			12,955			215,798
Restructuring and related costs	724			3,771			—			—			4,495
Depreciation and other	28,101			157,292			4,008			—			189,401
Amortization of intangible assets	2,245			8,662			—			—			10,907
Total expenses	218,465			1,761,136			41,300			8			2,020,909
Operating income (loss)	36,786			238,403			3,695			(8		)	278,876
Other income (expense), net:
Income (loss) from equity method investments, net	65,063			(45,135		)	—			—			19,928
Interest income (expense), net	(32,930		)	257			(134		)	—			(32,807		)
Other, net	(3,868		)	479			(218		)	8			(3,599		)
Total other income (expense), net	28,265			(44,399		)	(352		)	8			(16,478		)
Income from continuing operations before income taxes	65,051			194,004			3,343			—			262,398
Income tax benefit (expense)	30,893			(70,577		)	(26		)	—			(39,710		)
Income from continuing operations	95,944			123,427			3,317			—			222,688
Loss from discontinued operations, net of tax	(30,834		)	(2,708		)	(14,354		)	—			(47,896		)
Equity in income (loss) of subsidiaries	109,682			(11,037		)	—			(98,645		)	—
Net income (loss)	174,792			109,682			(11,037		)	(98,645		)	174,792
Foreign currency translation adjustment(1)	(105		)	—			961			—			856
Comprehensive income (loss)	$	174,687		$	109,682		$	(10,076	)	$	(98,645	)	$	175,648

(1) Foreign currency translation adjustment had no tax effect in 2013.

101

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	44,337		$	(7,667	)	$	23,192		$	(15,525	)	$	44,337
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	32,643			136,367			8,237			—			177,247
Amortization of intangible assets	14			13,536			44			—			13,594
Share-based payments expense	10,323			6,917			—			—			17,240
Windfall excess tax benefits related to share-based payments	(739		)	—			—			—			(739		)
Deferred income taxes	(14,533		)	(12,730		)	7,644			—			(19,619		)
Restructuring, impairment and related costs	509			1,545			—			—			2,054
Loss from equity method investments, net	800			—			—			—			800
Amortization of deferred financing fees and debt discount	2,761			—			—			—			2,761
Gain from early extinguishment of debt	(5,854		)	—			—			—			(5,854		)
Gain on purchase of Gazelle	—			(989		)	—			—			(989		)
Goodwill impairment	—			85,890			—			—			85,890
Other	(539		)	295			(728		)	—			(972		)
Equity in loss (income) of subsidiaries	7,667			(23,192		)	—			15,525			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(781		)	10,673			119			—			10,011
Content library	—			(11,951		)	3,631			—			(8,320		)
Prepaid expenses and other current assets	(2,826		)	(7,599		)	360			—			(10,065		)
Other assets	66			(62		)	158			—			162
Accounts payable	(1,316		)	21,447			(2,188		)	—			17,943
Accrued payable to retailers	2,758			(12,820		)	94			—			(9,968		)
Other accrued liabilities	(391		)	11,337			(374		)	—			10,572
Net cash flows from operating activities(1)	74,899			210,997			40,189			—			326,085
Investing Activities:
Purchases of property and equipment	(26,861		)	(49,071		)	(1,659		)	—			(77,591		)
Proceeds from sale of property and equipment	17			3,208			—			—			3,225
Acquisitions, net of cash acquired	—			(17,980		)	—			—			(17,980		)
Investments in and advances to affiliates	187,538			(145,721		)	(41,817		)	—			—
Net cash flows from (used in) investing activities(1)	160,694			(209,564		)	(43,476		)	—			(92,346		)
Financing Activities:
Proceeds from new borrowing of Credit Facility	310,500			—			—			—			310,500
Principal payments on Credit Facility	(339,375		)	—			—			—			(339,375		)
Repurchases of common stock	(159,800		)	—			—			—			(159,800		)
Repurchase of Notes	(34,589		)	—			—			—			(34,589		)
Dividends paid	(21,210		)	—			—			—			(21,210		)
Principal payments on capital lease obligations and other debt	(11,110		)	—			(400		)	—			(11,510		)
Financing costs associated with Credit Facility and senior unsecured notes	(9		)	—			—			—			(9		)
Windfall excess tax benefits related to share-based payments	739			—			—			—			739
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(1,461		)	—			—			—			(1,461		)
Net cash flows used in financing activities(1)	(256,315		)	—			(400		)	—			(256,715		)

102

	Year Ended December 31, 2015
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	—			—		2,829			—		2,829
Increase (decrease) in cash and cash equivalents	(20,722		)	1,433		(858		)	—		(20,147		)
Cash and cash equivalents:
Beginning of period	180,889			17,939		43,868			—		242,696
End of period	$	160,167		$	19,372	$	43,010		$	—	$	222,549

(1) During 2015 we discontinued our Redbox operations in Canada. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operationsfor cash flow disclosures related to our discontinued Redbox operations in Canada.

103

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	106,618		$	104,829		$	(14,378	)	$	(90,451	)	$	106,618
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	35,139			150,904			9,119			—			195,162
Amortization of intangible assets	1,433			13,259			—			—			14,692
Share-based payments expense	9,693			3,691			—			—			13,384
Windfall excess tax benefits related to share-based payments	(1,964		)	—			—			—			(1,964		)
Deferred income taxes	304			(17,232		)	(5,683		)	—			(22,611		)
Loss from equity method investments, net	530			28,204			—			—			28,734
Amortization of deferred financing fees and debt discount	4,116			—			—			—			4,116
Loss from early extinguishment of debt	2,018			—			—			—			2,018
Other	(1,250		)	(548		)	48			—			(1,750		)
Equity in loss (income) of subsidiaries	(104,829		)	14,378			—			90,451			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(1,130		)	8,787			1,014			—			8,671
Content library	36			20,206			(495		)	—			19,747
Prepaid expenses and other current assets	40,826			3,753			(297		)	—			44,282
Other assets	75			1,558			69			—			1,702
Accounts payable	(3,017		)	(65,737		)	(158		)	—			(68,912		)
Accrued payable to retailers	(1,896		)	(5,149		)	198			—			(6,847		)
Other accrued liabilities	(840		)	1,988			161			—			1,309
Net cash flows from (used in) operating activities(1)	85,862			262,891			(10,402		)	—			338,351
Investing Activities:
Purchases of property and equipment	(33,602		)	(57,909		)	(6,413		)	—			(97,924		)
Proceeds from sale of property and equipment	750			1,227			—			—			1,977
Cash paid for equity investments	—			(24,500		)	—			—			(24,500		)
Extinguishment payment received from equity investment	—			5,000			—			—			5,000
Investments in and advances to affiliates	166,145			(178,406		)	12,261			—			—
Net cash flows from (used in) investing activities(1)	133,293			(254,588		)	5,848			—			(115,447		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	295,500			—			—			—			295,500
Proceeds from new borrowing of Credit Facility	642,000			—			—			—			642,000
Principal payments on Credit Facility	(680,125		)	—			—			—			(680,125		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,911		)	—			—			—			(2,911		)
Settlement and conversion of convertible debt	(51,149		)	—			—			—			(51,149		)
Repurchases of common stock	(545,091		)	—			—			—			(545,091		)
Principal payments on capital lease obligations and other debt	(13,552		)	(3		)	(441		)	—			(13,996		)
Windfall excess tax benefits related to share-based payments	1,964			—			—			—			1,964
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(520		)	—			—			—			(520		)
Net cash flows from (used in) financing activities(1)	(353,884		)	(3		)	(441		)	—			(354,328		)

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	Year Ended December 31, 2014
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	368			—		2,315			—		2,683
Increase (decrease) in cash and cash equivalents	(134,361		)	8,300		(2,680		)	—		(128,741		)
Cash and cash equivalents:
Beginning of period	315,250			9,639		46,548			—		371,437
End of period	$	180,889		$	17,939	$	43,868		$	—	$	242,696

(1) During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

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CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	174,792		$	109,682		$	(11,037	)	$	(98,645	)	$	174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	29,640			158,801			5,259			—			193,700
Amortization of intangible assets	2,245			8,688			—			—			10,933
Share-based payments expense	9,903			6,928			—			—			16,831
Windfall excess tax benefits related to share-based payments	(3,698		)	—			—			—			(3,698		)
Deferred income taxes	9,228			(15,727		)	(4,434		)	—			(10,933		)
Restructuring, impairment and related costs	32,444			288			—			—			32,732
Loss (income) from equity method investments, net	(65,063		)	45,135			—			—			(19,928		)
Amortization of deferred financing fees and debt discount	6,394			—			—			—			6,394
Loss from early extinguishment of debt	6,013			—			—			—			6,013
Other	827			(2,951		)	31			54			(2,039		)
Equity in (income) losses of subsidiaries	(109,682		)	11,037			—			98,645			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(1,144		)	10,639			(1,517		)	—			7,978
Content library	1,093			(23,357		)	(195		)	—			(22,459		)
Prepaid expenses and other current assets	(43,762		)	(6,280		)	(500		)	—			(50,542		)
Other assets	201			400			(371		)	—			230
Accounts payable	1,319			(408		)	226			354			1,491
Accrued payable to retailers	(6,181		)	1,633			460			—			(4,088		)
Other accrued liabilities	13,184			(22,751		)	(6		)	—			(9,573		)
Net cash flows from (used in) operating activities(1)	57,753			281,757			(12,084		)	408			327,834
Investing Activities:
Purchases of property and equipment	(58,763		)	(88,431		)	(14,218		)	—			(161,412		)
Proceeds from sale of property and equipment	12,147			1,189			8			—			13,344
Acquisition of ecoATM, net of cash acquired	(244,036		)	—			—			—			(244,036		)
Receipt of note receivable principal	22,913			—			—			—			22,913
Cash paid for equity investments	—			(28,000		)	—			—			(28,000		)
Investments in and advances to affiliates	125,856			(156,659		)	30,857			(54		)	—
Net cash flows from (used in) investing activities(1)	(141,883		)	(271,901		)	16,647			(54		)	(397,191		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	343,769			—			—			—			343,769
Proceeds from new borrowing of Credit Facility	400,000			—			—			—			400,000
Principal payments on Credit Facility	(215,313		)	—			—			—			(215,313		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,203		)	—			—			—			(2,203		)
Conversion of convertible debt	(172,211		)	—			—			—			(172,211		)
Repurchases of common stock	(195,004		)	—			—			—			(195,004		)
Principal payments on capital lease obligations and other debt	(14,200		)	(217		)	(417		)	—			(14,834		)
Windfall excess tax benefits related to share-based payments	3,698			—			—			—			3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	8,460			—			—			—			8,460
Net cash flows from (used in) financing activities(1)	156,996			(217		)	(417		)	—			156,362

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	Year Ended December 31, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries		Eliminations and Consolidation Reclassifications			Total
Effect of exchange rate changes on cash	(105		)	—		1,643		—			1,538
Increase (decrease) in cash and cash equivalents	72,761			9,639		5,789		354			88,543
Cash and cash equivalents:
Beginning of period	242,489			—		40,759		(354		)	282,894
End of period	$	315,250		$	9,639	$	46,548	$	—		$	371,437

(1) During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

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Note 18: Income Taxes From Continuing Operations

Components of Income Taxes

The components of income from continuing operations before income taxes were as follows:

	Year Ended December 31,
Dollars in thousands	2015		2014		2013
U.S. operations	$	121,940	$	188,473	$	259,057
Foreign operations	1,125		2,368		3,341
Total income from continuing operations before income taxes	$	123,065	$	190,841	$	262,398

Components of Income Tax Expense

The components of income tax expense from continuing operations were as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Current:
U.S. Federal	$	89,996		$	69,117		$	38,876
State and local	10,658			12,294			10,104
Foreign	469			415			(424		)
Total current	101,123			81,826			48,556
Deferred:
U.S. Federal	(27,641		)	(16,232		)	(3,642		)
State and local	380			427			(5,653		)
Foreign	(243		)	143			449
Total deferred	(27,504		)	(15,662		)	(8,846		)
Total income tax expense	$	73,619		$	66,164		$	39,710

Rate Reconciliation

The income tax expense differs from the amount that would result by applying the U.S. statutory rate to income before income taxes as follows:

	Year Ended December 31,
	2015		2014		2013
U.S Federal tax expense at statutory rates	35.0	%	35.0	%	35.0	%
State income taxes, net of federal benefit	5.8		4.1		3.9
Federal and state credits	(1.6	)	(1.1	)	(0.9	)
Domestic production activities deduction	(4.9	)	(3.6	)	(0.6	)
Goodwill Impairment	24.4		—		—
Recognition of outside basis differences	—		(1.1	)	(15.4	)
ecoATM option payments	0.2		1.4		0.7
Valuation allowance	0.2		—		2.3
Acquisition of ecoATM	—		—		(9.3	)
Other	0.7		—		(0.6	)
Effective tax rate	59.8	%	34.7	%	15.1	%

Our effective tax rate for the year ended December 31, 2015, was higher than the U.S. Federal statutory rate of 35.0%primarily due to an $85.9 million non-tax deductible goodwill impairment charge recorded in the second quarter of 2015 and state income taxes, partially offset by the domestic production activities deduction and federal and state tax credits.

On December 18, 2015, the President signed into law the Protecting Americans from Tax Hikes Act of 2015, which retroactively extended a number of tax deductions and credits that otherwise would have expired, including the research and development credit and bonus depreciation. We reported the 2015 impact of the Act in the fourth quarter. 

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Our effective tax rate for the year ended December 31, 2014 was lower than the U.S. Federal statutory rate of 35.0% due primarily to the domestic production activities deduction and federal and state tax credits, partially offset by state income taxes.

Our effective tax rate for the year ended December 31, 2013 was lower than the U.S. Federal statutory rate of 35.0% due primarily to the following items:

• During the fourth quarter of 2013, we reported a $16.7 million tax benefit related to the recognition of a worthless stock deduction from an outside basis difference in a corporate subsidiary.

• During the third quarter of 2013, we reported a $24.3 million tax benefit related to the non-taxable gain upon the re-measurement of our previously held equity interest in ecoATM.

• During the second quarter of 2013, we entered into an arrangement to sell certain NCR kiosks and a series of transactions to reorganize Redbox related subsidiary structures through the sale of a wholly owned subsidiary. As a result of the series of transactions we recorded a discrete one-time tax benefit of $17.8 million, net of a valuation allowance, through the realization of capital and ordinary gains and losses.

The combined impact of these three items was a 22.4 percentage point reduction in the effective tax rate for the year ended December 31, 2013. In addition, our 2013 effective tax rate was increased by state income taxes, offset partially by the domestic production activities deduction.

We did not provide for U.S. income taxes on certain undistributed earnings of foreign operations that were considered permanently invested outside of the United States. Upon repatriation, some of these earnings would generate foreign tax credits, which may reduce the U.S. tax liability associated with any future foreign dividend. At December 31, 2015, the cumulative amount of earnings upon which U.S. income taxes have not been provided was approximately $18.8 million.

Unrecognized Tax Benefits

The aggregate changes in the balance of unrecognized tax benefits were as follows:

Dollars in thousands	Year Ended December 31,
	2015			2014			2013
Balance, beginning of the year	$	4,639		$	2,781		$	2,383
Additions based on tax positions related to the current year	1,837			1,836			824
Additions for tax positions related to prior years	527			806			18
Reductions for tax positions related to prior years	(118		)	—			(257		)
Reductions from lapse of applicable statute of limitations	—			(784		)	(49		)
Settlements	—			—			(138		)
Balance, end of year	$	6,885		$	4,639		$	2,781

We recognize interest and penalties, if any, related to income tax matters in Income tax expense. We accrued interest of $0.3 million and $0.1 million as of December 31, 2015 and December 31, 2014, respectively. It was not necessary to accrue interest in 2013 or accrue for penalties in any period presented.

Tax Years Open for Examination

As of December 31, 2015, for our major tax jurisdictions, the years 2012 through 2014 were open for examination by U.S. Federal and most state tax authorities. Additionally, the years 1998 through 2011 are subject to examination, to the extent that net operating loss and income tax credit carryforwards from those years were utilized in 2010 and later years.

Deferred Income Taxes

Deferred income tax assets and liabilities reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the carrying amounts used for income tax purposes. Future tax benefits for net operating loss and tax credit carryforwards are also recognized to the extent that realization of such benefits is more likely than not.

In determining our tax provisions, management determined the deferred tax assets and liabilities for each separate tax jurisdiction and considered a number of factors including the positive and negative evidence regarding the realization of our deferred tax assets to determine whether a valuation allowance should be recognized with respect to our deferred tax assets.

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Significant components of our deferred tax assets and liabilities and the net increase (decrease) in the valuation allowance were as follows:

Dollars in thousands	December 31,
	2015			2014
Deferred tax assets:
Income tax loss carryforwards	$	3,015		$	5,690
Capital loss carryforwards	4,759			5,930
Credit carryforwards	3,482			2,929
Accrued liabilities and allowances	27,188			22,652
Stock-based compensation	9,065			11,901
Intangible assets	13,109			17,166
Other	5,720			3,776
Gross deferred tax assets	66,338			70,044
Less: Valuation Allowance	(7,141		)	(6,898		)
Total deferred tax assets	59,197			63,146
Deferred tax liabilities:
Property and equipment	(42,984		)	(68,417		)
Product costs	(46,699		)	(43,140		)
Total deferred tax liabilities	(89,683		)	(111,557		)
Net deferred tax liabilities	$	(30,486	)	$	(48,411	)

Change in Valuation Allowance

Dollars in thousands	Year Ended December 31,
	2015		2014		2013
Increase in valuation allowance	$	243	$	—	$	6,898

The increase in our valuation allowance is due to changes in the expected future and actual utilization of capital losses and state tax credit carryforwards.

Deferred Tax Assets Relating to Income Tax Loss Carryforwards

Our deferred tax assets relating to income tax loss carryforwards and expiration periods are summarized as follows: 

Dollars in thousands	December 31, 2015
	Federal		State		Foreign
Net operating loss carryforwards	$	23	$	24,570	$	7,082
Deferred tax assets related to net operating loss carryforwards	$	8	$	1,118	$	1,889
Years that net operating loss carryforwards will expire between	2029-2034		2017-2033		2033-2035

U.S. State Tax Credits and Expiration Periods

The following table shows our U.S. state tax credits before valuation allowances and related expiration periods.

Dollars in thousands	December 31, 2015
	Amount		Expiration
U.S state tax credits:
Illinois state tax credits	$	2,894	2017-2021
California U.S. state tax credits	588		Do not expire
Total U.S. state tax credits	$	3,482

Note 19: Retirement Plans

We sponsor a defined contribution plan for our employees who satisfy certain age and service requirements. Our contributions to these plans were $4.3 million, $4.3 million and $4.9 million in 2015, 2014 and 2013, respectively.

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Note 20: Dividends

On February 3, 2015, our Board of Directors decided to initiate a quarterly cash dividend. The first cash dividend of $0.30 per outstanding share of our common stock was paid on March 18, 2015, to all stockholders of record on March 3, 2015. Additional cash dividends of $0.30 per outstanding share of our common stock were paid on June 23, 2015, September 15, 2015, and December 8, 2015. Total dividends paid in 2015 were $21.3 million, including $0.6 million paid to recipients of unvested restricted stock awards. See Note 13: Earnings Per Share for additional information.

Note 21: Subsequent Events

Studio Agreement

On January 21, 2016, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. After accounting for this amendment, our total estimated movie commitments to purchase content was approximately $640.5 million.

Dividend

On February 3, 2016, the Board declared a quarterly cash dividend of $0.30 per share expected to be paid on March 29, 2016, to all stockholders of record as of the close of business on March 15, 2016.

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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

We maintain a set of disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report and has determined that such disclosure controls and procedures are effective.

Changes in Internal Control over Financial Reporting

We also maintain a system of internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act). No changes in our internal control over financial reporting occurred during the quarter ended December 31, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Management’s Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in the Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2015, as required by the Exchange Act Rule 13a-15(c). In making this assessment, we used the criteria set forth in the framework in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on our evaluation under the framework in Internal Control-Integrated Framework (2013), our management concluded that our internal control over financial reporting was effective as of December 31, 2015.

Attestation Report of the Independent Registered Public Accounting Firm

The attestation report of KPMG LLP, our independent registered public accounting firm, on the effectiveness of our internal control over financial reporting is set forth on page 55.

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ITEM 9B. OTHER INFORMATION

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE 

The information required by this item is incorporated herein by reference to the Proxy Statement relating to our 2016 Annual Meeting of Stockholders.

ITEM 11. EXECUTIVE COMPENSATION 

The information required by this item is incorporated herein by reference to the Proxy Statement relating to our 2016 Annual Meeting of Stockholders.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 

The information required by this item is incorporated herein by reference to the Proxy Statement relating to our 2016 Annual Meeting of Stockholders.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE 

The information required by this item is incorporated herein by reference to the Proxy Statement relating to our 2016 Annual Meeting of Stockholders.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES 

The information required by this item is incorporated herein by reference to the Proxy Statement relating to our 2016 Annual Meeting of Stockholders.

PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

Financial Statements and Schedules

The consolidated financial statements, together with the report thereon of our independent registered public accounting firm, are included on the pages indicated below:

	Page
Reports of Independent Registered Public Accounting Firm	54
Consolidated Balance Sheets as of December 31, 2015 and 2014	56
Consolidated Statements of Comprehensive Income for the years ended December 31, 2015, 2014 and 2013	57
Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2015, 2014 and 2013	58
Consolidated Statements of Cash Flows for the years ended December 31, 2015, 2014 and 2013	59
Notes to Consolidated Financial Statements	62

There are no schedules required to be filed herewith.

113

Exhibits

The following exhibits are filed herewith and this list is intended to constitute the exhibit index.

In reviewing the agreements included as exhibits to this Annual Report on Form 10-K, please remember that they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure information about the Company or the other parties to the agreement. The agreements may contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the other party or parties to the applicable agreement and (i) should not in all instances be treated as categorical statements of fact, but rather as a means of allocating the risk to one of the parties if those statements prove to be inaccurate; (ii) may have been qualified by disclosures that were made to the other party or parties in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement; (iii) may apply standards of materiality in a manner that is different from what may be viewed as material to you or other investors; and (iv) were made only as of the date of the applicable agreement or other date or dates that may be specified in the agreement and are subject to more recent developments. Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time. Additional information about the Company may be found elsewhere in this Annual Report on Form 10-K and the Company’s other public filings, which are available without charge through the SEC’s website at http://www.sec.gov.

Exhibit Number	Description of Document
2.1†	Asset Purchase Agreement by and among Redbox Automated Retail, LLC and NCR Corporation, dated as of February 3, 2012.(14)
2.2	First Amendment to Asset Purchase Agreement by and among Redbox Automated Retail, LLC and NCR Corporation, dated as of June 22, 2012.(15)
2.3	Agreement and Plan of Merger, dated July 1, 2013, among Outerwall Inc., ecoATM, Inc. and Braeburn Acquisition Corporation.(10)
3.1	Restated Certificate of Incorporation, as amended.(1)
3.2	Amended and Restated Bylaws.(2)
4.1	Reference is made to Exhibits 3.1 through 3.2.(1), (2)
4.2	Specimen Stock Certificate.(17)
4.3	Indenture, dated as of March 12, 2013, among Coinstar, Inc., certain subsidiary guarantors and Wells Fargo Bank, National Association.(7)
4.4	Supplemental Indenture, dated as of December 19, 2013, among CUHL Holdings, LLC, the other Guarantors (as defined in the Indenture referred to therein) and Wells Fargo, National Association.(18)
4.5	Supplemental Indenture, dated as of August 30, 2013, among ecoATM, Inc., the other Guarantors (as defined in the Indenture referred to therein) and Wells Fargo, National Association.(18)
4.6	Supplemental Indenture, dated as of November 30, 2015, among OMLP LLC, the other Guarantors (as defined in the Indenture referred to therein) and Wells Fargo, National Association.
4.7	Form of 6.000% Exchange Note due 2019.(29)
4.8	Indenture, dated as of June 9, 2014, among Outerwall Inc., the Subsidiary Guarantors and U.S. Bank National Association.(20)
4.9	Supplemental Indenture, dated as of November 30, 2015, among OMLP LLC, the other Guarantors (as defined in the Indenture referred to therein) and U.S. Bank National Association.
4.10	Form of 5.875% Exchange Note due 2021.(30)
4.11	Restricted Stock Purchase Agreement, dated July 17, 2009, between Coinstar, Inc. and Sony Pictures Home Entertainment Inc.(3)
4.12	Amendment to Restricted Stock Purchase Agreement, dated as of July 19, 2011, between SPHE Scan Based Trading Corporation and Coinstar, Inc.(15)
4.13	Second Amendment to Restricted Stock Purchase Agreement, dated as of August 29, 2011, between SPHE Scan Based Trading Corporation and Coinstar, Inc.(8)

114

4.14	Restricted Stock Purchase Agreement, dated as of October 1, 2014, between Outerwall Inc. and Sony Pictures Home Entertainment Inc.(22)
4.15	Restricted Stock Purchase Agreement, dated as of October 1, 2015, between Outerwall Inc. and Sony Pictures Home Entertainment Inc.
4.16	Restricted Stock Purchase Agreement, dated as of November 10, 2015, between Outerwall Inc. and Paramount Home Entertainment Inc.
10.1*	Executive Deferred Compensation Plan, as amended and restated on December 31, 2008.(4)
10.2*	2014 Incentive Compensation Plan for Executive Leaders.(22)
10.3*	2015 Incentive Compensation Plan for Executive Leaders.(23)
10.4*	2015 Incentive Compensation Plan for Business Leaders.(24)
10.5*	Outerwall Inc. 2011 Incentive Plan, as amended and restated on February 12, 2015.(23)
10.6*	Equity Grant Program for Nonemployee Directors Under the 2011 Incentive Plan.(22)
10.7*	Form of Stock Option Grant Notice and Form of Stock Option Agreement under the 2011 Incentive Plan for Option Grants made to Nonemployee Directors prior to June 27, 2013.(8)
10.8*	Form of Stock Option Grant Notice and Form of Stock Option Agreement under the 2011 Incentive Plan for Option Grants made to the CEO, COO or CFO prior to June 27, 2013.(8)
10.9*	Form of Stock Option Grant Notice and Form of Stock Option Agreement under the 2011 Incentive Plan for Option Grants made to Executives other than the CEO, COO or CFO prior to June 27, 2013.(8)
10.10*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Awards made to the CEO, COO or CFO prior to June 27, 2013.(8)
10.11*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Awards made to Executives other than the CEO, COO or CFO prior to June 27, 2013.(8)
10.12*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Performance-Based Awards to the CEO, COO or CFO prior to June 27, 2013.(14)
10.13*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Performance-Based Awards to Executives other than the CEO, COO or CFO prior to June 27, 2013.(14)
10.14*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Awards made to Executives on or after June 27, 2013.(17)
10.15*	Form of Stock Option Grant Notice and Form of Stock Option Agreement under the 2011 Incentive Plan for Option Grants made to Nonemployee Directors on or after June 27, 2013.(17)
10.16*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Awards made to Nonemployee Directors on or after June 27, 2013.(17)
10.17*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Performance-Based Awards made to Executives on or after June 27, 2013 and before February 12, 2015.(17)
10.18*	Form of Notice of Restricted Stock Award and Restricted Stock Award Agreement under the 2011 Incentive Plan for Performance-Based Awards made to Executives on or after February 12, 2015.(23)
10.19*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Awards made to Erik E. Prusch.(25)
10.20*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 2011 Incentive Plan for Performance-Based Awards made to Erik E. Prusch.(25)
10.21*	1997 Amended and Restated Equity Incentive Plan.(5)
10.22*	Form of 1997 Amended and Restated Equity Incentive Plan Stock Option Grant Notice and Form of Stock Option Agreement for option grants made after December 12, 2005 to Plan Participants other than the CEO, COO or CFO.(4)

115

10.23*	Form of Notice of Restricted Stock Award and Form of Restricted Stock Award Agreement under the 1997 Amended and Restated Equity Incentive Plan for awards made after December 12, 2005 to Plan Participants other than the CEO, COO or CFO.(4)
10.24*	Policy on Reimbursement of Incentive Payments.(4)
10.25*	Offer Letter, dated January 2, 2013, between Coinstar, Inc. and J. Scott Di Valerio.(19)
10.26*	Amended and Restated Employment Agreement, entered into on January 2, 2013 and effective as of April 1, 2013, between Coinstar, Inc. and J. Scott Di Valerio.(19)
10.27*	Change of Control Agreement between Coinstar, Inc. and J. Scott Di Valerio, dated January 19, 2010.(6)
10.28*	Form of Change of Control Agreement.(11)
10.29*	First Amendment to Form of Change of Control Agreement.(4)
10.30*	Offer Letter for Maria Stipp, dated June 1, 2011.(16)
10.31*	Change of Control Agreement between Coinstar, Inc. and Maria Stipp, dated June 27, 2011.(16)
10.32*	Offer Letter, dated January 2, 2013, between Coinstar, Inc. and Galen C. Smith.(19)
10.33*	Employment Agreement, entered into on January 2, 2013 and effective as of April 1, 2013, between Coinstar, Inc. and Galen C. Smith.(19)
10.34*	Change of Control Agreement, dated as of January, 2, 2013, between Coinstar, Inc. and Galen C. Smith.(19)
10.35*	Offer Letter between Outerwall Inc. and Peter Osvaldik, dated May 12, 2014.(27)
10.36	Second Amended and Restated Credit Agreement (the “Credit Agreement”), dated July 15, 2011, among Coinstar, Inc., as borrower, Bank of America, N.A., as administrative agent, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as joint lead arrangers and joint book managers, Wells Fargo Bank, National Association, as syndication agent, HSBC Bank USA, National Association, Royal Bank of Canada and U.S. Bank National Association, as co-documentation agents, as well as other lenders that are parties thereto.(12)
10.37	First Amendment to Credit Agreement, dated as of October 25, 2011, among Coinstar, Inc., as borrower, Bank of America, N.A., as administrative agent for the lenders, and the other lenders party thereto.(13)
10.38	Consent, Waiver and Amendment dated March 7, 2013 under Second Amended and Restated Credit Agreement, dated July 15, 2011, as amended.(7)
10.39	Supplement and Amendment to Second Amended and Restated Credit Agreement, effective as of December 9, 2013, among Outerwall Inc., as borrower, the Revolving Lenders, the Additional Term Facility Lenders, and Bank of America, N.A., as administrative agent.(9)
10.40*	Third Amended and Restated Credit Agreement, dated June 24, 2014, among Outerwall Inc., as borrower, Bank of America, N.A., as administrative agent, swing line lender and letter of credit issuer, Merrill Lynch, Pierce, Fenner & Smith Incorporated, HSBC Bank USA, National Association, RBC Capital Markets and U.S. Bank National Association, as joint lead arrangers and joint bookrunners, HSBC Bank USA, National Association, Royal Bank of Canada and U.S. Bank National Association, as syndication agents, The Bank of Tokyo-Mitsubishi UFJ, Ltd. and Morgan Stanley Bank, N.A., as documentation agents, and the other lenders that are parties thereto.(21)
10.41*	Offer Letter for Mark Horak, dated January 28, 2014.(18)
10.42*	Employment Agreement between Redbox Automated Retail, LLC and Mark Horak, dated March 17, 2014.(18)
10.43*	Change of Control Agreement between Outerwall Inc. and Mark Horak, dated March 17, 2014.(18)
10.44*	Form of Indemnification Agreement for directors and Section 16 officers.(22)
10.45*	Interim CEO Agreement between Outerwall Inc. and Nora M. Denzel, dated January 18, 2015.(28)
10.46*	Letter Agreement between Outerwall Inc. and Donald Rench, dated February 12, 2015.(23)
10.47*	Release of Claims Agreement between Outerwall Inc. and James Pinckney, dated March 6, 2015.(23)
10.48*	Offer Letter for Erik E. Prusch, dated July 29, 2015.(25)

116

10.49*	Employment Agreement between Outerwall Inc. and Erik E. Prusch, executed on July 29, 2015.(25)
10.50*	Change of Control Agreement between Outerwall Inc. and Erik E. Prusch, executed on July 29, 2015.(25)
10.51*	Offer Letter between Outerwall Inc. and Jeffrey W. Kist.(26)
21.1	Subsidiaries.
23.1	Consent of Independent Registered Public Accounting Firm-KPMG LLP.
31.1	Certification of Chief Executive Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	XBRL Instance Document.
101.SCH	XBRL Taxonomy Extension Schema.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase.
101.DEF	XBRL Taxonomy Extension Definition Linkbase.
101.LAB	XBRL Taxonomy Extension Label Linkbase.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase.

117

*	Indicates a management contract or compensatory plan or arrangement.
†	Portions of this exhibit have been omitted pursuant to a confidential treatment order by the Securities and Exchange Commission.
(1)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended September 30, 2013 (File Number 000-22555).
(2)	Incorporated by reference to the Registrant’s Form 8-K filed on July 2, 2013 (File Number 000-22555).
(3)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended September 30, 2009 (File Number 000-22555).
(4)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended March 31, 2009 (File Number 000-22555).
(5)	Incorporated by reference to Appendix A of the Registrant’s Form DEF 14A filed on April 23, 2010 (File Number 000-22555).
(6)	Incorporated by reference to the Registrant’s Form 8-K filed on January 20, 2010 (File Number 000-22555).
(7)	Incorporated by reference to the Registrant’s Form 8-K filed on March 12, 2013 (File Number 000-22555).
(8)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended September 30, 2011 (File Number 000-22555).
(9)	Incorporated by reference to the Registrant’s Form 8-K filed on December 10, 2013 (File Number 000-22555).
(10)	Incorporated by reference to the Registrant’s Form 8-K filed on July 24, 2013 (File Number 000-22555).
(11)	Incorporated by reference to the Registrant’s Form 8-K filed on March 7, 2007 (File Number 000-22555).
(12)	Incorporated by reference to the Registrant’s Form 8-K filed on July 21, 2011 (File Number 000-22555).
(13)	Incorporated by reference to the Registrant’s Form 10-K for the year ended December 31, 2011 (File Number 000-22555).
(14)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended March 31, 2012 (File Number 000-22555).
(15)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended June 30, 2012 (File Number 000-22555).
(16)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended September 30, 2012 (File Number 000-22555).
(17)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended June 30, 2013 (File Number 000-22555).
(18)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended March 31, 2014 (File Number 000-22555).
(19)	Incorporated by reference to the Registrant’s Form 8-K filed on January 3, 2013 (File Number 000-22555).
(20)	Incorporated by reference to the Registrant’s Form 8-K filed on June 9, 2014 (File Number 000-22555).
(21)	Incorporated by reference to the Registrant’s Form 8-K filed on June 24, 2014 (File Number 000-22555).
(22)	Incorporated by reference to the Registrant’s Form 10-K for the year ended December 31, 2014 (File Number 000-22555).
(23)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended March 31, 2015 (File Number 000-22555).
(24)	Incorporated by reference to the Registrant’s Form 10-Q for the quarter ended June 30, 2015 (File Number 000-22555).
(25)	Incorporated by reference to the Registrant’s Form 8-K filed on July 30, 2015 (File Number 000-22555).
(26)	Incorporated by reference to the Registrant’s Form 8-K filed on December 7, 2015 (File Number 000-22555)
(27)	Incorporated by reference to the Registrant’s Form 8-K filed on May 16, 2014 (File Number 000-22555).
(28)	Incorporated by reference to the Registrant’s Form 8-K filed on January 20, 2015 (File Number 000-22555).
(29)	Incorporated by reference to the Registrant’s Form S-4 filed on September 6, 2013 (File Number 333-191044).
(30)	Incorporated by reference to the Registrant’s Form S-4 filed on March 5, 2015 (File Number 333-202523).

118

SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

OUTERWALL INC.
By:	/s/ Galen C. Smith
	Galen C. Smith
	Chief Financial Officer
	February 4, 2016

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on February 4, 2016:

Signature	Title
/s/ Erik E. Prusch	Chief Executive Officer and Director (Principal Executive Officer)
Erik E Prusch
/S/ Galen C. Smith	Chief Financial Officer (Principal Financial Officer)
Galen C. Smith
/S/ Jeffrey W. Kist	Interim Chief Accounting Officer (Principal Accounting Officer)
Jeffrey W. Kist
/S/ Nelson C. Chan	Chair of the Board
Nelson C. Chan
/S/ Nora M. Denzel	Director
Nora M. Denzel
/s/ David M. Eskenazy	Director
David M. Eskenazy
/s/ Ross G. Landsbaum	Director
Ross G. Landsbaum
/S/ Robert D. Sznewajs	Director
Robert D. Sznewajs
/S/ Ronald B. Woodard	Director
Ronald B. Woodard

119

EX-4.6

EXHIBIT 4.6

SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of November 30, 2015, among OMLP LLC, a Washington limited liability company (the “Guaranteeing Subsidiary”), an indirect subsidiary of Outerwall Inc. (f/k/a Coinstar, Inc.) (or its permitted successor), a Delaware corporation (the “Company”), the other Guarantors (as defined in the Indenture referred to herein) and Wells Fargo, National Association, a national banking association as trustee under the Indenture referred to below (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the “Indenture”), dated as of March 12, 2013 providing for the issuance of 6.000% Senior Notes due 2019 (the “Notes”);

WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company’s Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the “Note Guarantee”);

WHEREAS, this Supplemental Indenture shall not result in a material modification of the Notes for purposes of compliance with the Foreign Accounts Tax Compliance Act; and

WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders as follows:

1. Capitalized Terms. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

2. Agreement to Guarantee. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Note Guarantee and in the Indenture including but not limited to Article 10 thereof.

4. No Recourse Against Others. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy.

5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

7. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction hereof.

8. The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company.

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

Dated as of November 30, 2015

OUTERWALL INC.
By:	/s/ Galen C. Smith
Name:	Galen C. Smith
Title:	Chief Financial Officer
OMLP LLC By: ecoATM, Inc., as Sole Manager
By:	/s/ David D. Maquera
Name:	David D. Maquera
Title:	President
WELLS FARGO BANK, NATIONAL ASSOCIATION, AS TRUSTEE
By:	/s/ Michael Tu
Name:	Michael Tu
Title:	Assistant Vice President

2

EX-4.9

EXHIBIT 4.9

SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of November 30, 2015, among OMLP LLC, a Washington limited liability company (the “Guaranteeing Subsidiary”), an indirect subsidiary of Outerwall Inc. (or its permitted successor), a Delaware corporation (the “Company”), the other Guarantors (as defined in the Indenture referred to herein) and U.S. Bank National Association, a national banking association as trustee under the Indenture referred to below (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture (the “Indenture”), dated as of June 9, 2014 providing for the issuance of 5.875% Senior Notes due 2021(the “Notes”);

WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company’s Obligations under the Notes and the Indenture on the terms and conditions set forth herein (the “Note Guarantee”); and

WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders as follows:

1. Capitalized Terms. Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

2. Agreement to Guarantee. The Guaranteeing Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and subject to the conditions set forth in the Note Guarantee and in the Indenture including but not limited to Article 10 thereof.

4. No Recourse Against Others. No past, present or future director, officer, employee, incorporator, stockholder or agent of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guaranteeing Subsidiary under the Notes, any Note Guarantees, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy.

5. NEW YORK LAW TO GOVERN. THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6. Counterparts. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

7. Effect of Headings. The Section headings herein are for convenience only and shall not affect the construction hereof.

8. The Trustee. The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company.

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

Dated as of November 30, 2015

OUTERWALL INC.
By:	/s/ Galen C. Smith
Name:	Galen C. Smith
Title:	Chief Financial Officer
OMLP LLC By: ecoATM, Inc., as Sole Manager
By:	/s/ David D. Maquera
Name:	David D. Maquera
Title:	President
U.S. BANK NATIONAL ASSOCIATION, as Trustee
By:	/s/ Christine Ok
Name:	Christine Ok
Title:	Vice President

EX-4.15

EXHIBIT 4.15

RESTRICTED STOCK PURCHASE AGREEMENT

This Restricted Stock Purchase Agreement (this "Agreement") is made as of October 1, 2015, between Outerwall Inc., a Delaware corporation (the "Company"), and Sony Pictures Home Entertainment Inc., a Delaware corporation ("Sony").

Reference herein is made to that certain Copy Depth License Agreement executed between Redbox Automated Retail, LLC, a Delaware limited liability company and a wholly owned subsidiary of the Company ("Redbox"), and SPHE Scan Based Trading Corporation, a Delaware corporation and an affiliate of Sony (“SPHE”), dated as of July 1, 2009, and as subsequently amended by that First Amendment, Second Amendment and Amended and Restated Copy Depth Agreement, dated July 19, 2011, August 29, 2011, and July 31, 2012, respectively (collectively, the "License Agreement") and to the Side Letter executed between the Company and SPHE, dated as of July 31, 2012 (the "Side Letter"). Capitalized terms not explicitly defined in this Agreement but defined in the License Agreement shall have the same meanings as set forth with respect to such terms in the License Agreement.

1.Restricted Stock Issuance

In connection with the License Agreement and the Side Letter and the exercise of the 2016 Extension Option (as defined in the Side Letter) thereunder, and subject to the terms and conditions of the License Agreement and this Agreement, the Company hereby agrees to issue to Sony 25,000 shares of the Company's common stock, par value $0.001 per share ("Common Stock").

The Company shall issue the Shares as soon as practicable following the date of this Agreement, and in any event within thirty (30) business days following the date of this Agreement, and the Shares shall be deemed immediately vested on issuance.

2.Status of Participant

Upon issuance of the Shares, Sony will be recorded as a registered stockholder of the Company with respect to the Shares. The Company and its transfer agent will promptly provide to Sony written conformation of such issuance and recordation. Upon issuance of the Shares, Sony will have in connection with the Shares all rights of a holder of Common Stock of the Company, including, without limitation, voting rights and rights to dividends and distributions in respect of the Shares.

3.Securities Law Compliance; Certain Representations

3.1    The Shares to be acquired by Sony under this Agreement will be acquired for investment for Sony's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof. Sony has no present intention of selling, granting any participation in, or otherwise distributing the Shares. Sony does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participations to such person or entity or to any other person or entity, with respect to any of the Shares. Sony represents and warrants that it (a) has been furnished with all information which it deems necessary to evaluate the merits and risks of receipt of the Shares, (b) has had the opportunity to ask questions and receive answers concerning the information received about the Shares and the Company, and (c) has been given the opportunity to obtain any additional information it deems necessary to verify the accuracy of any information obtained concerning the Shares and the Company. Sony is an "accredited investor" under Regulation D promulgated under the Securities Act of 1933, as amended (the "Securities Act").

3.2    Sony hereby agrees that it will in no event sell or distribute all or any part of the Shares unless (a) there is an effective registration statement under the Securities Act, and applicable state and other securities laws covering any such transaction involving the Shares or (b) the Company receives an opinion of Sony’s legal counsel (which counsel may be Sony’s internal corporate counsel, and which opinion is reasonable or customary in form and substance) stating that such transaction is exempt from registration or the Company otherwise satisfies itself that such transaction is exempt from registration. The Company shall provide promptly to Sony all information reasonably requested in connection with preparing such opinion. Sony understands that the Company has no obligation to register the Shares with the Securities and Exchange Commission (the "SEC") and has not represented to Sony that the Company will so register the Shares.

3.3    Sony confirms that it has been advised, prior to its receipt of the Shares, that neither the offering of the Shares nor any offering materials have been reviewed by any administrator or other governmental entity under the Securities Act or any other applicable securities act.

3.4    The Company represents and warrants that each of the issuance and delivery of the Shares in accordance with the Agreement, as well as the execution and delivery of this Agreement, has been duly authorized by all necessary corporate action on the part of the Company, that all such Shares have been duly reserved for issuance and that the Shares will, upon issuance, be duly and validly issued, fully paid and nonassessable and free and clear of any liens or encumbrances except for restrictions on

transfer set forth herein and under applicable securities laws (subject only to the vesting and forfeiture provision in this Agreement). The Company further represents and warrants that, (a) the Company is not, and never has been a “shell company” as defined under Rule 144 of the Securities Act and (b) assuming the accuracy of Section 3.1, the offer, sale and issuance of the Shares to Sony does not require registration under the Securities Act and is in compliance with applicable federal and state securities laws.

4.No Section 83(b) Election for Shares; Independent Tax Advice

Sony acknowledges that it has not provided, and will not be providing, any services to the Company or to Redbox under the License Agreement or otherwise. As such, Sony hereby confirms that the Shares are not being transferred in connection with the performance of services within the meaning of Section 83(a) of the Internal Revenue Code of 1986 (the "Code"), and Sony is not entitled to, and will not make, an election with respect to the Shares under Section 83(b) of the Code.

SONYFURTHER ACKNOWLEDGES THAT THE COMPANY HAS DIRECTED SONY TO SEEK INDEPENDENT ADVICE REGARDING THE APPLICABLE PROVISIONS OF THE CODE AND THE INCOME TAX LAWS OF ANY APPLICABLE MUNICIPALITY, STATE OR FOREIGN COUNTRY WHERE SONY IS OR MAY BE SUBJECT TO TAX.

Sony acknowledges that determining the actual tax consequences to Sony of receiving or disposing of the Shares may be complicated. These tax consequences will depend, in part, on Sony’s specific situation and may also depend on the resolution of currently uncertain tax law and other variables not within the control of the Company. Sony is aware that it should consult a competent and independent tax advisor for a full understanding of the specific tax consequences of receiving or disposing of the Shares. Prior to executing this Agreement, Sony either has consulted with a competent tax advisor independent of the Company to obtain tax advice concerning the Shares in light of its specific situation or has had the opportunity to consult with such a tax advisor but has chosen not to do so.

5.Book Entry Registration of the Shares

The Company will issue the Shares by registering the Shares in book entry form with the Company’s transfer agent in Sony’s name and the applicable restrictions will be noted in the records of the Company’s transfer agent and in the book entry system. Subject to provision by Sony of any documentation reasonably requested by the Company, upon written request by Sony the Company will provide to the transfer agent (and to such other persons as may be reasonably required) such documentation as is reasonably necessary to facilitate a lawful transfer of Shares pursuant to the terms and conditions of this Agreement.

6.Stop‑Transfer Notices and Restrictive Legends

6.1    Sony understands and agrees that, in order to ensure compliance with securities laws, the Company may issue appropriate "stop‑transfer" and other instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records. The Company will not be required to (a) transfer on its books any Shares that have been sold or transferred in violation of the provisions of this Agreement or (b) treat as the owner of the Shares, or otherwise accord voting, or dividend rights to any transferee to whom the Shares have been transferred in contravention of this Agreement.

6.2    The restrictions noted in the records of the Company's transfer agent and any certificate or certificates representing the Shares shall bear the following legends in substantially the following form (as well as any other legends required by applicable state and federal corporate securities laws) as reasonably deemed appropriate by the Company:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION OR OTHER TRANSFER THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR THE COMPANY'S RECEIPT OF AN OPINION OF TRANSFEROR'S LEGAL COUNSEL STATING THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION OR THE COMPANY OTHERWISE SATISFIES ITSELF THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION.

Notwithstanding the foregoing, upon Sony’s request, promptly following the date that Shares may be sold under Rule 144 without volume restrictions or manner of sale limitations, the Company shall cause its legal counsel to issue a legal opinion to the Company’s transfer agent and to Sony (which opinion shall be reasonable in form and substance) that any and all certificates representing such Shares shall be issued free of all legends.

7.Rule 144 Reporting

7.1    With a view to making available the benefits of certain rules and regulations of the SEC that will permit the sale of the Shares without registration with the SEC, the Company agrees to:

(a)    make and keep public information available, as such terms are understood and defined in Rule 144(c)(i) of the Securities Act, at all times until the one year anniversary from the date on which all Shares held by Sony under this Agreement have vested;

(b)    file with the SEC in a timely manner all reports and other documents required to be filed by the Company under the Securities Exchange Act of 1934, as amended (the "Exchange Act"); and

(c)    so long as Sony owns any Shares, upon request by Sony, if the Company is not filing reports and other documents under the Exchange Act, the Company will make available other information as required by Rule 144A (including the provision of information to Sony and prospective purchasers designated by Sony pursuant to Rule 144A(d)(4)) for so long as necessary to permit sales of the Shares pursuant to Rule 144A, and commencing at such time as sales are permitted under Rule 144, and in any event shall make available (either by mailing a copy thereof, by posting on the Company’s website, or by press release) to Sony a copy of:

(i)    the Company’s annual consolidated financial statements (including at least balance sheets, statements of profit and loss, statements of stockholders’ equity and statements of cash flows) prepared in accordance with generally accepted accounting principles in the United States, no later than 90 days after the end of each fiscal year of the Company; and

(ii)    the Company’s quarterly consolidated financial statements (including at least balance sheets, statements of profit and loss, statements of stockholders’ equity and statements of cash flows) prepared in a manner substantially consistent with the preparation of the Company’s annual consolidated financial statements, no later than 45 days after the end of each fiscal quarter of the Company.

7.2    If the Company shall fail for any reason to satisfy the requirements of clause (a) or (b) of this Section 7 (a "Public Information Failure") then, in addition to Sony's other available remedies, the Company shall pay to Sony, in cash, as partial liquidated damages and not as a penalty, by reason of any such delay in or reduction of its ability to sell the Shares then held by Sony (or a U.S. affiliate of Sony), an amount in cash equal to two percent (2.0%) of the aggregate value of the Shares then held by Sony (or a U.S. affiliate of Sony) valued at the higher of the average of the closing price per share of the Company's Common Stock for the ten full trading days prior to, but not including, the date of this Agreement or the average closing price per share of the Company’s Common Stock for the ten full trading days prior to, but not including, the day of the Public Information Failure on the day of a Public Information Failure and on every thirtieth (30^th) day (pro rated for periods totaling less than thirty days) thereafter until the earlier of (i) the date such Public Information Failure is cured and (ii) such time that such public information is no longer required  for Sony to transfer its Shares pursuant to Rule 144.  The payments to which Sony shall be entitled pursuant to this Section 7.2 are referred to herein as "Public Information Failure Payments."  Public Information FailurePayments shall be paid on the earlier of (1) the last day of the calendar month during which such Public Information FailurePayments are incurred and (2) the third (3^rd) business day after the event or failure giving rise to the Public Information FailurePayments is cured.  In the event the Company fails to make Public Information FailurePayments in a timely manner, such Public Information FailurePayments shall bear interest at a rate equal to the lesser of 1.5% per month (prorated for partial months) or the maximum amount allowed by applicable law until paid in full. Nothing herein shall limit Sony’s right to pursue actual damages for the Public Information Failure, and Sony shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

8.Tax Withholding

Sony shall provide such certificates as reasonably requested by the Company to enable the Company to comply with any applicable information reporting or withholding requirements with respect to the Shares, and such certificates may include, among other things, a properly executed IRS Form W-9.

9.General Provisions

9.1Notices

Whenever any notice is required or permitted hereunder, such notice must be in writing and personally delivered or sent by facsimile or mail. Any notice required or permitted to be delivered hereunder shall be deemed to be delivered on the date on

which it is personally delivered or facsimile distributed with verifiable receipt, or, whether actually received or not, on the third business day after it is deposited in the United States mail, certified or registered, postage prepaid, addressed to the party who is to receive it at the address or facsimile number that such party has theretofore specified by written notice delivered in accordance herewith. The Company or Sony may change, by written notice to the other, the address previously specified for receiving notices. Unless changed pursuant to the terms of this Section, notices delivered to the Company shall be addressed as follows:

Company:    Outerwall Inc.

Attn: Chief Legal Officer and General Counsel

1800 114^th Avenue SE

Bellevue, WA 98004

Fax.: (425) 943-8090

and notices delivered to Sony shall be addressed as follows:

Sony:        Sony Pictures Home Entertainment Inc.

c/o Sony Pictures Entertainment Inc.

10202 West Washington Boulevard

Culver City, CA 90232

Attention: General Counsel

Facsimile: (310) 244-0510

and

Attention: Executive Vice President, Corporate Legal

Facsimile: (310)-244-2169

9.2No Waiver

No waiver of any provision of this Agreement will be valid unless in writing and signed by the party against whom such waiver is sought to be enforced, nor will failure to enforce any right hereunder constitute a continuing waiver of the same or a waiver of any other right hereunder.

9.3Undertaking

Each party hereby agrees to take whatever additional action and execute whatever additional documents the other party may reasonably deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on such party pursuant to the express provisions of this Agreement.

9.4Entire Contract

This Agreement constitutes the entire agreement between the parties hereto with regard to the subject matter hereof and supersedes all prior oral or written agreements on the subject.

9.5Successors and Assigns

The provisions of this Agreement will inure to the benefit of, and be binding on, the Company and its successors and assigns and Sony’s successors and assigns and transferees by operation of law, whether or not any such party will have become a party to this Agreement and agreed in writing to join herein and be bound by the terms and conditions hereof.

9.6Counterparts

This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but which, upon execution, will constitute one and the same instrument.

9.7Governing Law; Dispute Resolution

The provisions of this Agreement shall be governed by the laws of the state of Delaware, without giving effect to principles of conflicts of law. The provisions of Section 6.2 of Schedule A to the License Agreement are hereby incorporated into this Agreement such that the procedures set forth in such Section 6.2 (and its subsections) shall apply to any action or proceeding arising in connection with, touching upon, or relating to this Agreement.

9.8Confidentiality

The parties acknowledge and agree that the Company may disclose this Agreement in its SEC filings to the extent such disclosure is required by the securities laws, rules and regulations in order to be in compliance with applicable requirements.  Except as provided in the preceding sentence, the parties hereto will keep the terms and existence of this Agreement confidential and will not now or hereafter divulge any of this information to any third party except (a) with the prior written consent of the other party; (b) as otherwise may be required by law or legal process or, so long as such disclosure is made pursuant to binding confidentiality obligations, as may be required in connection with profit participants or guild obligations; (c) during the course of litigation, so long as the disclosure of such terms and conditions is restricted in the same manner as is the confidential information of other litigating parties; or (d) in confidence to its affiliates or its, or its affiliates’, legal counsel, accountants, banks, and financing sources and their advisors in connection with complying with or administering its obligations with respect to this Agreement; provided, however, that in (b) and (c) above, to the extent permitted by law, (i) the disclosing party will use all reasonably available legal means to minimize the disclosure to third parties, including, without limitation, seeking a confidential treatment request or protective order whenever appropriate or available; and (ii) the disclosing party will provide the other party with at least ten (10) days' prior written notice of such disclosure.

[Signature page follows]

IN WITNESS WHEREOF, the parties have executed this Agreement dated as of the date first set forth above.

OUTERWALL INC.
By:	/s/ Donald Rench
Name:	Donald Rench
Title:	Chief Legal Officer
SONY PICTURES HOME ENTERTAINMENT INC.
By:	/s/ William V. Stellman
Name:	William V. Stellman
Title:	EVP, CFO

EX-4.16

EXHIBIT 4.16

RESTRICTED STOCK PURCHASE AGREEMENT

This Restricted Stock Purchase Agreement (this "Agreement") is made as of November 10, 2015, between Outerwall Inc. (f/k/a Coinstar, Inc.), a Delaware corporation (the "Company"), and Paramount Home Entertainment Inc., a Delaware corporation ("Paramount").

Reference herein is made to that certain Revenue Sharing License Agreement executed between Redbox Automated Retail, LLC, a Delaware limited liability company and a wholly owned subsidiary of the Company ("Redbox"), and Paramount, dated as of August 25, 2009, and as subsequently amended by that First Amendment, Second Amendment, Third Amendment, Fourth Amendment and Fifth Amendment thereto, dated December 10, 2009, June 15, 2010, July 12, 2010, June 3, 2011 and October 26, 2011, respectively (collectively, the "License Agreement"). Capitalized terms not explicitly defined in this Agreement but defined in the License Agreement shall have the same meanings as set forth with respect to such terms in the License Agreement.

1.Restricted Stock Issuance

Pursuant to the License Agreement, in connection with Paramount’s exercise of the 2016 Extension Option and subject to the terms and conditions of this Agreement, the Company shall issue to Paramount 50,000 shares (collectively, the "Shares") of the Company's common stock, par value $0.001 per share ("Common Stock").

The Company shall issue the Shares as of January 1, 2016 (or as soon as practicable following such date).

2.Status of Participant

Upon issuance of the Shares, Paramount will be recorded as a registered stockholder of the Company with respect to the Shares. The Company and its transfer agent will promptly provide to Paramount written confirmation of such issuance and recordation. Upon issuance of the Shares, Paramount will have in connection with the Shares all rights of a holder of Common Stock of the Company, including, without limitation, voting rights and rights to dividends and distributions in respect of the Shares.

3.Securities Law Compliance; Certain Representations

3.1    The Shares to be acquired by Paramount under this Agreement will be acquired for investment for Paramount's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof. Paramount has no present intention of selling, granting any participation in, or otherwise distributing the Shares. Paramount does not have any contract, undertaking, agreement or arrangement with any person or entity to sell, transfer or grant participations to such person or entity or to any other person or entity, with respect to any of the Shares. Paramount represents and warrants that it (a) has been furnished with all information which it deems necessary to evaluate the merits and risks of receipt of the Shares, (b) has had the opportunity to ask questions and receive answers concerning the information received about the Shares and the Company, and (c) has been given the opportunity to obtain any additional information it deems necessary to verify the accuracy of any information obtained concerning the Shares and the Company. Paramount is an "accredited investor" under Regulation D promulgated under the Securities Act of 1933, as amended (the "Securities Act").

3.2    Paramount hereby agrees that it will in no event sell or distribute all or any part of the Shares unless (a) there is an effective registration statement under the Securities Act, and applicable state and other securities laws covering any such transaction involving the Shares or (b) the Company receives an opinion of Paramount's legal counsel (which counsel may be Paramount's internal corporate counsel, and which opinion is reasonable or customary in form and substance) stating that such transaction is exempt from registration or the Company otherwise satisfies itself that such transaction is exempt from registration. The Company shall provide promptly to Paramount all information reasonably requested in connection with preparing such opinion. Paramount understands that the Company has no obligation to register the Shares with the Securities and Exchange Commission (the "SEC") and has not represented to Paramount that the Company will so register the Shares.

3.3    Paramount confirms that it has been advised, prior to its receipt of the Shares, that neither the offering of the Shares nor any offering materials have been reviewed by any administrator or other governmental entity under the Securities Act or any other applicable securities act.

3.4    The Company represents and warrants that each of the issuance and delivery of the Shares in accordance with the Agreement, as well as the execution and delivery of this Agreement, has been duly authorized by all necessary corporate action on the part of the Company, that all such Shares have been duly reserved for issuance and that the Shares will, upon issuance, be duly and validly issued, fully paid and nonassessable and free and clear of any liens or encumbrances except for restrictions on transfer set forth herein and under applicable securities laws (subject only to the vesting and forfeiture provision in this Agreement). The Company further represents and warrants that, (a) the Company is not, and never has been a "shell company" as defined under Rule 144 of the Securities Act and (b) assuming the accuracy of Section 3.1, the offer, sale and issuance of the Shares to Paramount does not require registration under the Securities Act and is in compliance with applicable federal and state securities laws.

4.Independent Tax Advice

PARAMOUNTACKNOWLEDGES THAT THE COMPANY HAS DIRECTED PARAMOUNT TO SEEK INDEPENDENT ADVICE REGARDING THE APPLICABLE PROVISIONS OF THE INTERNAL REVENUE CODE OF 1986 AND THE INCOME TAX LAWS OF ANY APPLICABLE MUNICIPALITY, STATE OR FOREIGN COUNTRY WHERE PARAMOUNT IS OR MAY BE SUBJECT TO TAX.

Paramount acknowledges that determining the actual tax consequences to Paramount of receiving or disposing of the Shares may be complicated. These tax consequences will depend, in part, on Paramount's specific situation and may also depend on the resolution of currently uncertain tax law and other variables not within the control of the Company. Paramount is aware that it should consult a competent and independent tax advisor for a full understanding of the specific tax consequences of receiving or disposing of the Shares. Prior to executing this Agreement, Paramount either has consulted with a competent tax advisor independent of the Company to obtain tax advice concerning the Shares in light of its specific situation or has had the opportunity to consult with such a tax advisor but has chosen not to do so.

5.Book Entry Registration of the Shares

The Company will issue the Shares by registering the Shares in book entry form with the Company's transfer agent in Paramount's name and the applicable restrictions will be noted in the records of the Company's transfer agent and in the book entry system. Subject to provision by Paramount of any documentation reasonably requested by the Company, upon written request by Paramount the Company will provide to the transfer agent (and to such other persons as may be reasonably required) such documentation as is reasonably necessary to facilitate a lawful transfer of Shares pursuant to the terms and conditions of this Agreement.

6.Stop‑Transfer Notices and Restrictive Legends

6.1    Paramount understands and agrees that, in order to ensure compliance with the restrictions referred to in this Agreement, the Company may issue appropriate "stop‑transfer" and other instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in its own records. The Company will not be required to (a) transfer on its books any Shares that have been sold or transferred in violation of the provisions of this Agreement or (b) treat as the owner of the Shares, or otherwise accord voting, or dividend rights to any transferee to whom the Shares have been transferred in contravention of this Agreement.

6.2    The restrictions noted in the records of the Company's transfer agent and any certificate or certificates representing the Shares shall bear the following legends in substantially the following form (as well as any other legends required by applicable state and federal corporate securities laws) as reasonably deemed appropriate by the Company:

THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION OR OTHER TRANSFER THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR THE COMPANY'S RECEIPT OF AN OPINION OF TRANSFEROR'S LEGAL COUNSEL STATING THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION OR THE COMPANY OTHERWISE SATISFIES ITSELF THAT SUCH TRANSFER IS EXEMPT FROM REGISTRATION.

Notwithstanding the foregoing, upon Paramount's request, promptly following the date that the Shares may be sold under Rule 144 without volume restrictions or manner of sale limitations, the Company shall cause its legal counsel to issue an instruction letter to the Company's transfer agent and to Paramount (which instruction letter shall be reasonable in form and substance) that

any and all certificates representing such Shares shall be issued free of all legends and any such legends shall be removed from the records of the Company's transfer agent.

7.Rule 144 Reporting

7.1    With a view to making available the benefits of certain rules and regulations of the SEC that will permit the sale of the Shares without registration with the SEC, the Company agrees to:

(a)    make and keep public information available, as such terms are understood and defined in Rule 144(c)(i) of the Securities Act, at all times until the one year anniversary from the date of this Agreement;

(b)    file with the SEC in a timely manner all reports and other documents required to be filed by the Company under the Securities Exchange Act of 1934, as amended (the "Exchange Act"); and

(c)    so long as Paramount owns any Shares, upon request by Paramount, if the Company is not filing reports and other documents under the Exchange Act, the Company will make available other information as required by, and so long as necessary to permit sales of the Shares pursuant to, Rule 144A (including the provision of information to Paramount and prospective purchasers designated by Paramount pursuant to Rule 144A(d)(4)) and, commencing at such time as sales are permitted under Rule 144, Rule 144A, and in any event shall make available (either by mailing a copy thereof, by posting on the Company's website, or by press release) to Paramount a copy of:

(i)    the Company's annual consolidated financial statements (including at least balance sheets, statements of profit and loss, statements of stockholders' equity and statements of cash flows) prepared in accordance with generally accepted accounting principles in the United States, no later than 90 days after the end of each fiscal year of the Company; and

(ii)    the Company's quarterly consolidated financial statements (including at least balance sheets, statements of profit and loss, statements of stockholders' equity and statements of cash flows) prepared in a manner substantially consistent with the preparation of the Company's annual consolidated financial statements, no later than 45 days after the end of each fiscal quarter of the Company.

7.2    If the Company shall fail for any reason to satisfy the requirements of clause (a) or (b) of Section 7.1 (a "Public Information Failure") then, in addition to Paramount's other available remedies, the Company shall pay to Paramount, in cash, as partial liquidated damages and not as a penalty, by reason of any such delay in or reduction of its ability to sell the Shares then held by Paramount (or a U.S. affiliate of Paramount), an amount in cash equal to two percent (2.0%) of the aggregate value of the Shares then held by Paramount (or a U.S. affiliate of Paramount) valued at the higher of $31.89 or the average closing price per share of the Company's Common Stock for the ten full trading days prior to, but not including, the day of the Public Information Failure on the day of a Public Information Failure and on every thirtieth (30^th) day (pro rated for periods totaling less than thirty days) thereafter until the earlier of (i) the date such Public Information Failure is cured and (ii) such time that such public information is no longer required for Paramount to transfer its Shares pursuant to Rule 144.  The payments to which Paramount shall be entitled pursuant to this Section 7.2 are referred to herein as "Public Information Failure Payments."  Public Information FailurePayments shall be paid on the earlier of (1) the last day of the calendar month during which such Public Information FailurePayments are incurred and (2) the third (3^rd) business day after the event or failure giving rise to the Public Information FailurePayments is cured.  In the event the Company fails to make Public Information FailurePayments in a timely manner, such Public Information FailurePayments shall bear interest at a rate equal to the lesser of 1.5% per month (prorated for partial months) or the maximum amount allowed by applicable law until paid in full. Nothing herein shall limit Paramount's right to pursue actual damages for the Public Information Failure, and Paramount shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief.

7.Tax Withholding

Paramount shall provide such certificates as reasonably requested by the Company to enable the Company to comply with any applicable information reporting or withholding requirements with respect to the Shares, and such certificates may include, among other things, a properly executed IRS Form W-9.

8.General Provisions

8.1Notices

Whenever any notice is required or permitted hereunder, such notice must be in writing and personally delivered or sent by mail. Any notice required or permitted to be delivered hereunder shall be deemed to be delivered on the date on which it is personally delivered or, whether actually received or not, on the third business day after it is deposited in the United States mail, certified or registered, postage prepaid, addressed to the party who is to receive it at the address that such party has theretofore specified by written notice delivered in accordance herewith. The Company or Paramount may change, by written notice to the other, the address previously specified for receiving notices. Unless changed pursuant to the terms of this Section, notices delivered to the Company shall be addressed as follows:

Company:        Outerwall Inc.

Attn: General Counsel

1800 114^th Avenue SE

Bellevue, WA 98004

and notices delivered to Paramount shall be addressed as follows:

Paramount:        Executive Vice President, Business Affairs and Legal,

Home Media Distribution

Paramount Home Entertainment Inc.

5555 Melrose Avenue

Los Angeles, CA 90038    

8.2No Waiver

No waiver of any provision of this Agreement will be valid unless in writing and signed by the party against whom such waiver is sought to be enforced, nor will failure to enforce any right hereunder constitute a continuing waiver of the same or a waiver of any other right hereunder.

8.3Undertaking

Each party hereby agrees to take whatever additional action and execute whatever additional documents the other party may reasonably deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on such party pursuant to the express provisions of this Agreement.

8.4Entire Contract

This Agreement constitutes the entire agreement between the parties hereto with regard to the subject matter hereof and supersedes all prior oral or written agreements on the subject.

8.5Successors and Assigns

The provisions of this Agreement will inure to the benefit of, and be binding on, the Company and its successors and assigns and Paramount's successors and assigns and transferees by operation of law, whether or not any such party will have become a party to this Agreement and agreed in writing to join herein and be bound by the terms and conditions hereof.

8.6Counterparts

This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but which, upon execution, will constitute one and the same instrument.

8.7Governing Law

The provisions of this Agreement shall be governed by the laws of the state of Delaware, without giving effect to principles of conflicts of law.

8.8Confidentiality

The parties acknowledge and agree that the Company may disclose this Agreement in filings on Form 10-Q or 10-K to the extent such disclosure is required by the Exchange Act in order to be in compliance with the requirements of such Form.  Except as provided in the preceding sentence, the parties hereto will keep the terms and existence of this Agreement confidential and will not now or hereafter divulge any of this information to any third party except (a) with the prior written consent of the other party; (b) as otherwise may be required by law or legal process or, so long as such disclosure is made pursuant to binding confidentiality obligations, as may be required in connection with profit participants or guild obligations; (c) during the course of litigation, so long as the disclosure of such terms and conditions is restricted in the same manner as is the confidential information of other litigating parties; or (d) in confidence to its affiliates or its, or its affiliates', legal counsel, accountants, banks, and financing sources and their advisors in connection with complying with or administering its obligations with respect to this Agreement; provided, however, that in (b) and (c) above, to the extent permitted by law, (i) the disclosing party will use all reasonably available legal means to minimize the disclosure to third parties, including, without limitation, seeking a confidential treatment request or protective order whenever appropriate or available; and (ii) the disclosing party will provide the other party with at least ten (10) days' prior written notice of such disclosure.

IN WITNESS WHEREOF, the parties have executed this Agreement dated as of the date first set forth above.

OUTERWALL INC.
By:	/s/ Donald R. Rench
Name:	Donald R. Rench
Title:	CLO
PARAMOUNT HOME ENTERTAINMENT INC.
By:	/s/ Marguerite A. Pacacha
Name:	Marguerite A. Pacacha
Title:	Authorized Signatory

EX-21.1

EXHIBIT 21.1

Subsidiaries as of December 31, 2015

Clover One, LLC (Delaware)

Coinstar Automated Retail Canada Inc (British Columbia)

Coinstar International, Inc. (Delaware)

Coinstar Ireland Limited (Republic of Ireland)

Coinstar Limited (United Kingdom)

Coinstar Procurement, LLC (Delaware)

CUHL Foods, LLC (Delaware)

CUHL Holdings, LLC (Washington)

ecoATM, Inc. (Delaware)

OMLP LLC (Washington)

Outerwall Holdings Inc. (Delaware)

Outerwall Services LLC (Delaware)

Redbox Automated Retail Canada Inc (British Columbia)

Redbox Automated Retail, LLC (Delaware)

Redbox Incentives LLC (Illinois)

RAR Ventures, LLC (Delaware)

Sesame Holdings, LLC (Delaware)

EX-23.1

EXHIBIT 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Outerwall Inc.:

We consent to the incorporation by reference in the registration statements (Nos. 333‑174638, 333-178323, 333-30985, 333-899975, 333-63108, 333-98297, 333-100870, 333-120547, 333-127293 and 333-147087) on Form S-8 and registration statements (Nos. 333-123326, 333-130000, 333-157552, 333-157553, 333-183514, and 333-206560) on Form S-3 of Outerwall Inc. of our reports dated February 4, 2016, with respect to the consolidated balance sheets of Outerwall Inc. and subsidiaries as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income, stockholders’ equity (deficit), and cash flows for each of the years in the three-year period ended December 31, 2015, and the effectiveness of internal control over financial reporting as of December 31, 2015, which reports appear in the December 31, 2015 annual report on Form 10‑K of Outerwall Inc.

Our report on the consolidated balance sheets of Outerwall Inc. as of December 31, 2015 and 2014, and the related consolidated statements of comprehensive income, stockholders’ equity (deficit), and cash flows for each of the three-year period ended December 31, 2015 refers to a change in the method for amortization of content library costs.

Our report on the effectiveness of internal control over financial reporting as of December 31, 2015 contains an explanatory paragraph stating that the Company acquired Gazelle, Inc. (Gazelle) during 2015 and management excluded from its assessment of the effectiveness of Outerwall Inc.’s internal control over financial reporting as of December 31, 2015, Gazelle’s internal control over financial reporting associated with total assets of $24.0 million and total revenues of $13.3 million included in the consolidated financial statements of Outerwall Inc. and subsidiaries as of and for the year ended December 31, 2015. Our audit of internal control over financial reporting of Outerwall Inc. also excluded an evaluation of the internal control over financial reporting of Gazelle.

(signed) KPMG LLP

Seattle, Washington

February 4, 2016

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Erik E. Prusch, certify that:

1. I have reviewed this annual report on Form 10-K of Outerwall Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report:

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: February 4, 2016

By: /s/ Erik E. Prusch

Erik E. Prusch

Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

I, Galen C. Smith, certify that:

1. I have reviewed this annual report on Form 10-K of Outerwall Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report:

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: February 4, 2016

By: /s/ Galen C. Smith

Galen C. Smith

Chief Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Outerwall Inc. (the "Company") on Form 10-K for the year ended December 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Form 10-K"), I, Erik E. Prusch, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m or 78o(d)); and

(2) The information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.

 Dated: February 4, 2016

By: /s/ Erik E. Prusch

Erik E. Prusch

Chief Executive Officer

EX-32.2

EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Outerwall Inc. (the "Company") on Form 10-K for the year ended December 31, 2015 as filed with the Securities and Exchange Commission on the date hereof (the "Form 10-K"), I, Galen C. Smith, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (15 U.S.C. 78m or 78o(d)); and

(2) The information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.

 Dated: February 4, 2016

By: /s/ Galen C. Smith

Galen C. Smith

Chief Financial Officer

XML

Document And Entity Information - USD ($) $ in Billions	12 Months Ended
	Dec. 31, 2015	Jan. 29, 2016	Jun. 30, 2015
Document And Entity Information [Abstract]
Document Type	10-K
Document Period End Date	Dec. 31, 2015
Amendment Flag	false
Entity Registrant Name	OUTERWALL INC
Entity Central Index Key	0000941604
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Document Fiscal Year Focus	2015
Document Fiscal Period Focus	FY
Entity Common Stock, Shares Outstanding		16,614,033
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	Yes
Entity Public Float			$ 1.2

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Current Assets:
Cash and cash equivalents	$ 222,549	$ 242,696	$ 371,437	$ 282,894
Accounts receivable, net of allowances of $1,272 and $2,223	38,464	48,590
Content library	188,490	180,121
Prepaid expenses and other current assets	51,368	39,819
Total current assets	500,871	511,226
Property and equipment, net	316,013	428,468
Deferred income taxes	2,606	11,363
Goodwill and other intangible assets, net (Note 6)	540,514	623,998
Other long-term assets	6,056	8,231
Total assets	1,366,060	1,583,286
Current Liabilities:
Accounts payable	184,010	168,633
Accrued payable to retailers	115,098	126,290
Other accrued liabilities	141,437	137,126
Current portion of long-term debt and other long-term liabilities	17,131	20,416
Total current liabilities	457,676	452,465
Long-term debt and other long-term liabilities (Note 8)	897,366	973,669
Deferred income taxes	33,092	59,774
Total liabilities	$ 1,388,134	$ 1,485,908
Commitments and contingencies
Stockholders’ Equity (Deficit):
Preferred stock, $0.001 par value - 5,000,000 shares authorized; no shares issued or outstanding	$ 0	$ 0
Common stock, $0.001 par value - 60,000,000 authorized; 36,720,579 and 36,600,166 shares issued; 16,607,516 and 18,926,242 shares outstanding;	485,163	473,592
Treasury stock	(1,151,063)	(996,293)
Retained earnings	643,452	620,389
Accumulated other comprehensive income (loss)	374	(310)
Total stockholders’ equity (deficit)	(22,074)	97,378	$ 518,689	$ 549,088
Total liabilities and stockholders’ equity (deficit)	$ 1,366,060	$ 1,583,286

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Statement of Financial Position [Abstract]
Accounts receivable, allowances	$ 1,272	$ 2,223
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	60,000,000	60,000,000
Common stock, shares issued	36,720,579	36,600,166
Common stock, shares outstanding	16,607,516	18,926,242

XML

Consolidated Statements Of Comprehensive Income - USD ($) shares in Thousands, $ in Thousands		3 Months Ended				12 Months Ended
		Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2015		Dec. 31, 2014		Dec. 31, 2013
Statement of Comprehensive Income [Abstract]
Revenue						$ 2,193,211		$ 2,291,586		$ 2,299,785
Expenses:
Direct operating	[1]					1,493,088		1,581,311		1,556,999
Marketing						35,674		35,293		30,227
Research and development						7,198		13,047		13,082
General and administrative						190,393		190,496		215,798
Restructuring and related costs (Note 11)						27,153		557		4,495
Depreciation and other						171,390		187,824		189,401
Amortization of intangible assets						13,550		14,654		10,907
Goodwill impairment (Note 6)				$ 85,900		85,890		0		0
Total expenses						2,024,336		2,023,182		2,020,909
Operating income						168,875		268,404		278,876
Other income (expense), net:
Income (loss) from equity method investments, net (Note 7)						(800)		(28,734)		19,928
Interest expense, net						(42,353)		(47,644)		(32,807)
Other, net						(2,657)		(1,185)		(3,599)
Total other expense, net						(45,810)		(77,563)		(16,478)
Income from continuing operations before income taxes						123,065		190,841		262,398
Income tax expense						(73,619)		(66,164)		(39,710)
Income from continuing operations						49,446		124,677		222,688
Loss from discontinued operations, net of tax (Note 12)						(5,109)		(18,059)		(47,896)
Net income						44,337		106,618		174,792
Foreign currency translation adjustment	[2]					684	[3]	457	[4]	856	[5]
Comprehensive income						45,021		107,075		175,648
Income from continuing operations attributable to common shares (Note 13):
Basic						48,117		120,748		217,215
Diluted						$ 48,118		$ 120,806		$ 217,394
Basic earnings (loss) per common share (Note 13):
Continuing operations (in usd per share)						$ 2.75		$ 5.98		$ 7.98
Discontinued operations (in usd per share)						(0.29)		(0.89)		(1.76)
Basic earnings per share (in usd per share)						2.46		5.09		6.22
Diluted earnings (loss) per common share (Note 13):
Continuing operations (in usd per share)						2.75		5.89		7.72
Discontinued operations (in usd per share)						(0.29)		(0.88)		(1.70)
Diluted earnings per share (in usd per share)						$ 2.46		$ 5.01		$ 6.02
Weighted average common shares [Abstract]
Weighted average common shares - basic (in shares)						17,467		20,192		27,216
Weighted average common shares - diluted (in shares)	[6]					17,487		20,503		28,169
Dividends declared per common share (in usd per share)		$ 0.30	$ 0.30	$ 0.30	$ 0.30	$ 1.20		$ 0		$ 0

[1] “Direct operating” excludes depreciation and other of $118.7 million, $125.7 million and $129.1 million for 2015, 2014 and 2013, respectively.

[2] Foreign currency translation adjustment had no tax effect in 2015, 2014 and 2013.

[3] Foreign currency translation adjustment had no tax effect in 2015.

[4] Foreign currency translation adjustment had no tax effect in 2014.

[5] Foreign currency translation adjustment had no tax effect in 2013.

[6] Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive than the calculation using the treasury stock method.

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Consolidated Statements Of Comprehensive Income (Parenthetical) - USD ($)	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Statement of Comprehensive Income [Abstract]
Depreciation and other excluded from direct operating expenses	$ 118,700,000	$ 125,700,000	$ 129,100,000
Foreign currency translation adjustment, tax effect	$ 0	$ 0	$ 0

XML

Consolidated Statements Of Stockholders' Equity - USD ($)	Total		Common Stock	Treasury Stock	Retained Earnings	Accumulated Other Comprehensive Loss
BEGINING BALANCE (in shares) at Dec. 31, 2012			28,626,323
BEGINING BALANCE at Dec. 31, 2012	$ 549,088,000		$ 504,881,000	$ (293,149,000)	$ 338,979,000	$ (1,623,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Proceeds from exercise of stock options, net (in shares)			411,902
Proceeds from exercise of stock options, net	12,655,000		$ 12,655,000
Adjustments related to tax withholding for share-based compensation (in shares)			(76,401)
Adjustments related to tax withholding for share-based compensation	(4,195,000)		$ (4,195,000)
Share-based payments expense (in shares)			223,173
Share-based payments expense	16,831,000		$ 16,831,000
Excess tax benefit on share-based compensation expense	$ 3,287,000		$ 3,287,000
Repurchases of common stock (in shares)	(3,306,433)		(3,306,433)
Repurchases of common stock	$ (195,004,000)			(195,004,000)
Conversion of callable convertible debt, net of tax (in shares)			272,336
Conversion of callable convertible debt, net of tax	(38,175,000)		$ (49,532,000)	11,357,000
Debt conversion feature (in shares)			0
Debt conversion feature	(1,446,000)		$ (1,446,000)
Net income	174,792,000				174,792,000
Foreign currency translation adjustment	856,000	[1],[2]				856,000	[3]
ENDING BALANCE (in shares) at Dec. 31, 2013			26,150,900
ENDING BALANCE at Dec. 31, 2013	518,689,000		$ 482,481,000	(476,796,000)	513,771,000	(767,000)
Statement of Stockholders' Equity (Footnote) [Abstract]
Foreign currency translation adjustment, tax effect	0
BEGINING BALANCE (in shares) at Dec. 31, 2012			28,626,323
BEGINING BALANCE at Dec. 31, 2012	$ 549,088,000		$ 504,881,000	(293,149,000)	338,979,000	(1,623,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Repurchases of common stock (in shares)	(13,745,799)
Repurchases of common stock	$ (896,175,000)
ENDING BALANCE (in shares) at Dec. 31, 2015	16,607,516
ENDING BALANCE at Dec. 31, 2015	$ (22,074,000)		$ 485,163,000	(1,151,063,000)	643,452,000	374,000
BEGINING BALANCE (in shares) at Dec. 31, 2013			26,150,900
BEGINING BALANCE at Dec. 31, 2013	518,689,000		$ 482,481,000	(476,796,000)	513,771,000	(767,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Proceeds from exercise of stock options, net (in shares)			103,260
Proceeds from exercise of stock options, net	3,735,000		$ 3,735,000
Adjustments related to tax withholding for share-based compensation (in shares)			(61,543)
Adjustments related to tax withholding for share-based compensation	(4,255,000)		$ (4,255,000)
Share-based payments expense (in shares)			227,092
Share-based payments expense	14,424,000		$ 13,036,000	1,388,000
Excess tax benefit on share-based compensation expense	$ 1,920,000		$ 1,920,000
Repurchases of common stock (in shares)	(7,925,227)		(7,925,227)
Repurchases of common stock	$ (545,140,000)			(545,140,000)
Conversion of callable convertible debt, net of tax (in shares)			431,760
Conversion of callable convertible debt, net of tax	(516,000)		$ (24,771,000)	24,255,000
Adjustment and settlement of debt conversion feature classified as temporary equity	1,446,000		$ 1,446,000
Net income	106,618,000				106,618,000
Foreign currency translation adjustment	$ 457,000	[2],[4]				457,000	[3]
ENDING BALANCE (in shares) at Dec. 31, 2014	18,926,242		18,926,242
ENDING BALANCE at Dec. 31, 2014	$ 97,378,000		$ 473,592,000	(996,293,000)	620,389,000	(310,000)
Statement of Stockholders' Equity (Footnote) [Abstract]
Foreign currency translation adjustment, tax effect	$ 0
Proceeds from exercise of stock options, net (in shares)	49,000		48,992
Proceeds from exercise of stock options, net	$ 2,552,000		$ 2,552,000
Adjustments related to tax withholding for share-based compensation (in shares)			(60,255)
Adjustments related to tax withholding for share-based compensation	(4,013,000)		$ (4,013,000)
Share-based payments expense (in shares)			206,676
Share-based payments expense	17,288,000		$ 12,258,000	5,030,000
Excess tax benefit on share-based compensation expense	$ 774,000		$ 774,000
Repurchases of common stock (in shares)	(2,514,139)		(2,514,139)
Repurchases of common stock	$ (159,800,000)			(159,800,000)
Net income	44,337,000				44,337,000
Dividends (Note 20)	(21,274,000)				(21,274,000)
Foreign currency translation adjustment	$ 684,000	[2],[5]				684,000
ENDING BALANCE (in shares) at Dec. 31, 2015	16,607,516
ENDING BALANCE at Dec. 31, 2015	$ (22,074,000)		$ 485,163,000	$ (1,151,063,000)	$ 643,452,000	$ 374,000
Statement of Stockholders' Equity (Footnote) [Abstract]
Foreign currency translation adjustment, tax effect	$ 0

[1] Foreign currency translation adjustment had no tax effect in 2013.

[2] Foreign currency translation adjustment had no tax effect in 2015, 2014 and 2013.

[3] Foreign currency translation adjustment had no tax effect for the years ended December 31, 2015, 2014 and 2013.

[4] Foreign currency translation adjustment had no tax effect in 2014.

[5] Foreign currency translation adjustment had no tax effect in 2015.

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Consolidated Statements Of Cash Flows - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2015		Dec. 31, 2014		Dec. 31, 2013
Operating Activities:
Net income		$ 44,337		$ 106,618		$ 174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other		177,247		195,162		193,700
Amortization of intangible assets		13,594		14,692		10,933
Share-based payments expense		17,240		13,384		16,831
Windfall excess tax benefits related to share-based payments		(739)		(1,964)		(3,698)
Deferred income taxes		(19,619)		(22,611)		(10,933)
Impairment expense, restructuring and lease termination costs	[1]	2,054		0		32,732
(Income) loss from equity method investments, net		800		28,734		(19,928)
Amortization of deferred financing fees and debt discount		2,761		4,116		6,394
(Gain) loss from early extinguishment of debt		(5,854)		2,018		6,013
Gain on purchase of Gazelle (Note 3)		(989)		0		0
Goodwill impairment (Note 6)		85,890		0		0
Other		(972)		(1,750)		(2,039)
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net		10,011		8,671		7,978
Content library		(8,320)		19,747		(22,459)
Prepaid expenses and other current assets		(10,065)		44,282		(50,542)
Other assets		162		1,702		230
Accounts payable		17,943		(68,912)		1,491
Accrued payable to retailers		(9,968)		(6,847)		(4,088)
Other accrued liabilities		10,572		1,309		(9,573)
Net cash flows from operating activities	[2]	326,085		338,351		327,834
Investing Activities:
Purchases of property and equipment		(77,591)		(97,924)		(161,412)
Proceeds from sale of property and equipment		3,225		1,977		13,344
Acquisitions, net of cash acquired		(17,980)		0		(244,036)
Receipt of note receivable principal		0		0		22,913
Cash paid for equity investments		0		(24,500)		(28,000)
Extinguishment payment received from equity investment		0		5,000		0
Net cash flows used in investing activities	[2]	(92,346)		(115,447)		(397,191)
Financing Activities:
Proceeds from issuance of senior unsecured notes		0		295,500		343,769
Proceeds from new borrowing on Credit Facility		310,500		642,000		400,000
Principal payments on Credit Facility		(339,375)		(680,125)		(215,313)
Financing costs associated with Credit Facility and senior unsecured notes	[3]	(9)		(2,911)		(2,203)
Settlement and conversion of convertible debt		0		(51,149)		(172,211)
Repurchase of Notes (Note 9)		(34,589)		0		0
Repurchases of common stock	[4]	(159,800)		(545,091)		(195,004)
Dividends paid (Note 20)		(21,210)		0		0
Principal payments on capital lease obligations and other debt		(11,510)		(13,996)		(14,834)
Windfall excess tax benefits related to share-based payments		739		1,964		3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options		(1,461)		(520)		8,460
Net cash flows from (used in) financing activities	[2]	(256,715)	[5]	(354,328)	[6]	156,362	[7]
Effect of exchange rate changes on cash		2,829		2,683		1,538
Increase (decrease) in cash and cash equivalents		(20,147)		(128,741)		88,543
Cash and cash equivalents:
Beginning of period		242,696		371,437		282,894
End of period		222,549		242,696		371,437
Supplemental disclosure of cash flow information:
Cash paid during the period for interest		45,502		41,614		20,699
Cash paid during the period for income taxes, net		100,544		36,777		55,989
Supplemental disclosure of non-cash investing and financing activities:
Purchases of property and equipment financed by capital lease obligations		2,397		8,198		7,408
Purchases of property and equipment included in ending accounts payable		2,577		8,255		6,656
Non-cash gain included in equity investments		0		0		68,376
Common stock issued on conversion of callable convertible debt, net of tax		0		24,255		14,292
Non-cash debt issue costs	[3]	$ 0		$ 4,500		$ 6,231

[1] The non-cash restructuring, impairment and related costs in 2015 of $2.1 million is composed of $7.4 million in impairments of lease related assets partially offset by a $5.3 million benefit resulting from the lease termination. The 2013 non-cash charge represents asset impairments of $32.7 million related to our four ventures previously included in our former New Ventures segment, Orango, Rubi, Crisp Market, and Star Studio, which were discontinued during 2013.

[2] During 2015 we discontinued our Redbox operations in Canada. 2014 also includes the wind-down process of certain new ventures that were discontinued during 2013. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

[3] Total financing costs associated with the Credit Facility and senior unsecured notes issued in 2014 were $8.2 million composed of non-cash debt issue costs of $4.5 million recorded as debt discount associated with our issuance of $300.0 million senior unsecured notes due 2021, $1.5 million in deferred financing fees associated with the senior unsecured notes, and $2.2 million in deferred financing fees associated with the refinancing of our Credit Facility. The cash payments for financing costs associated with the Credit Facility and senior unsecured notes in 2014 were $2.9 million.

[4] The total cost of repurchases of common stock in 2014 was $545.1 million, which includes $3.7 million in fees and expenses relating to the tender offer recorded as part of the cost of treasury stock in our Consolidated Balance Sheets. The cash payments for the tender offer fees in 2014 were $3.7 million.

[5] During 2015 we discontinued our Redbox operations in Canada. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

[6] During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

[7] During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

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Consolidated Statements Of Cash Flows (Parenthetical) - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2015	Dec. 31, 2014	Jun. 30, 2014
Additional cash flow information
Impairment expense, restructuring and lease termination costs	[1]	$ 2,054	$ 0
Impairment of long-lived assets to be disposed of		7,440
Gain (Loss) on Contract Termination		5,300
Deferred Finance Costs, Gross			8,200
Debt Instrument, Unamortized Discount		6,564	8,783
Principal		886,283	956,250
Payments of Financing Costs	[2]	9	2,911
Repurchases of common stock	[3]	$ (159,800)	(545,091)
Credit Facility
Additional cash flow information
Deferred Finance Costs, Gross			2,200
Senior Unsecured Notes due 2021 | Senior Notes
Additional cash flow information
Debt Instrument, Unamortized Discount				$ 4,500
Principal			300,000
Senior Unsecured Notes due 2019 | Senior Notes
Additional cash flow information
Deferred Finance Costs, Gross			1,500
Tender Offer
Additional cash flow information
Professional fees paid			3,700
Payments for Fees			$ 3,700

[1] The non-cash restructuring, impairment and related costs in 2015 of $2.1 million is composed of $7.4 million in impairments of lease related assets partially offset by a $5.3 million benefit resulting from the lease termination. The 2013 non-cash charge represents asset impairments of $32.7 million related to our four ventures previously included in our former New Ventures segment, Orango, Rubi, Crisp Market, and Star Studio, which were discontinued during 2013.

[2] Total financing costs associated with the Credit Facility and senior unsecured notes issued in 2014 were $8.2 million composed of non-cash debt issue costs of $4.5 million recorded as debt discount associated with our issuance of $300.0 million senior unsecured notes due 2021, $1.5 million in deferred financing fees associated with the senior unsecured notes, and $2.2 million in deferred financing fees associated with the refinancing of our Credit Facility. The cash payments for financing costs associated with the Credit Facility and senior unsecured notes in 2014 were $2.9 million.

[3] The total cost of repurchases of common stock in 2014 was $545.1 million, which includes $3.7 million in fees and expenses relating to the tender offer recorded as part of the cost of treasury stock in our Consolidated Balance Sheets. The cash payments for the tender offer fees in 2014 were $3.7 million.

XML

Organization and Business

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Business

Note 1: Organization and Business

Description of Business

We are a leading provider of automated retail solutions offering convenient products and services that benefit consumers and drive incremental retail traffic and revenue for retailers. During 2015:

• We made the decision to discontinue operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit does not represent a major component of our operations or financial results, the results of SAMPLEit do not qualify to be reported as a discontinued operation and remain in our All Other reporting category. See Note 14: Business Segments and Enterprise-Wide Information for additional information.

• To align with a change in how our chief operating decision maker evaluates business performance, we added ecoATM, our electronic device recycling business, as a separate reportable segment in the first quarter of 2015. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts are included in our All Other reporting category as they do not meet quantitative thresholds to be reported as a separate segment. See Note 14: Business Segments and Enterprise-Wide Information for additional information.

• We discontinued our Redbox operations in Canada ("Redbox Canada") as the business was not meeting our performance expectations. We have reclassified the results of Redbox Canada to discontinued operations for all periods presented in our Consolidated Statements of Comprehensive Income. See Note 12: Discontinued Operations for additional information.

• We acquired certain assets and liabilities of Gazelle, Inc. ("Gazelle") in the fourth quarter of 2015. Results of operations for Gazelle from the acquisition date, November 10, 2015, are included in our ecoATM segment. See Note 3: Business Combinations and Note 14: Business Segments and Enterprise-Wide Information for additional information.

Our core offerings in automated retail include our Redbox, Coinstar and ecoATM segments. Our Redbox segment consists of self-service kiosks where consumers can rent or purchase movies and video games. Our Coinstar segment consists of self-service coin-counting kiosks where consumers can convert their coins to cash or stored value products. We also offer self-service kiosks that exchange gift cards for cash under our Coinstar™ Exchange brand. Our ecoATM segment consists of self-service kiosks and an online solution where consumers can sell certain electronic devices for cash and generates revenue through the sale of devices collected to third party resellers, through online marketplaces and through the Gazelle direct-to-consumer storefront.

In addition to our three reportable segments, we may also conduct business activities through other self-service concepts, where we identify, evaluate, build or acquire and develop new self-service retail concepts and regularly assess these concepts to determine whether continued funding or other alternatives are appropriate.

On July 23, 2013 we acquired the remaining 77.0% equity interest in our ecoATM business. We paid $262.9 million in cash and the primary assets received included property and equipment of $23.2 million, identified intangible assets of $41.4 million and goodwill of $264.2 million, which is not deductible for tax purposes. The primary reason for the business combination was to expand Outerwall’s presence in automated retail and gain exposure to the growing demand for refurbished products and mobile devices. Since the acquisition date, the results of ecoATM operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment. See Note 14: Business Segments and Enterprise-Wide Information for more information.

Our kiosks are located primarily in supermarkets, drug stores, mass merchants, convenience stores, financial institutions, malls and restaurants. Our kiosk and location counts as of December 31, 2015, are as follows:

	Kiosks	Locations
Redbox	40,480	33,060
Coinstar	20,930	19,660
ecoATM	2,250	2,020
All Other(1)	120	120
Total	63,780	54,860

(1) As part of our decision to discontinue operating SAMPLEit in the fourth quarter of 2015, all SAMPLEit kiosks were removed from their locations during January 2016.

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Note 2: Summary of Significant Accounting Policies

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Outerwall Inc. and our wholly-owned subsidiaries. Investments in companies of which we may have significant influence, but not a controlling interest, are accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates in Financial Reporting

We prepare our financial statements in conformity with accounting principles generally accepted in the U.S. which requires management to make estimates and assumptions that affect the reported amounts in our consolidated financial statements and our notes thereto. The most significant estimates and assumptions include the:

• useful lives and salvage values of our content library;

• determination of goodwill impairment;

• lives and recoverability of equipment and other long-lived assets;

• recognition and measurement of current and long-term deferred income taxes (including the measurement of uncertain tax positions);

• recognition and measurement of purchase price allocation for business combinations; and

• loss contingencies.

It is reasonably possible that the estimates we make may change in the future and could have a material effect on our financial statements.

Cash and Cash Equivalents

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Our cash and cash equivalents were $222.5 million and $242.7 million at December 31, 2015, and December 31, 2014, respectively. Of this total, cash equivalents were $2.7 million and $0.9 million, respectively, and consisted of money market demand accounts and investment grade fixed income securities such as money market funds, certificate of deposits, and commercial paper. Our cash balances with financial institutions may exceed the deposit insurance limits.

Included in our cash and cash equivalents at December 31, 2015, and December 31, 2014, were $83.3 million and $81.7 million, respectively that we identified for settling our accrued payable to our retailer partners in relation to our Coinstar kiosks.

Separately included in our cash and cash equivalents at December 31, 2015, and December 31, 2014, were $46.2 million and $66.5 million, respectively in cash and cash equivalents held in financial institutions domestically and $9.0 million and $11.6 million, respectively in cash and cash equivalents held in foreign financial institutions.

Accounts Receivable

Accounts receivable represents receivables, net of allowances for doubtful accounts. The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balance. We determine the allowance based on historical experience and other currently available information. When a specific account is deemed uncollectible, the account is written off against the allowance. Amounts expensed for uncollectible accounts and amounts charged against the allowance were immaterial in all periods presented.

Content Library

Content library consists of movies and video games available for rent or purchase. We obtain our movie and video game content primarily through revenue sharing agreements and license agreements with studios and game publishers, as well as through distributors and other suppliers. The cost of content mainly includes the cost of the movies and video games, labor, overhead, freight, and studio revenue sharing expenses. The content purchases are capitalized and amortized to their estimated salvage value as a component of direct operating expenses over the usage period. For purchased content that we expect to sell at the end of its useful life, we determine an estimated salvage value. Content salvage values are estimated based on the amounts that we have historically recovered on disposal. For licensed content that we do not expect to sell, no salvage value is provided. The useful lives and salvage value of our content library are periodically reviewed and evaluated. Amortization charges are derived utilizing rental curves based on historical performance of movies and games over their useful lives and recorded on an accelerated basis, reflecting higher rentals of movies and video games in the first few weeks after release, and substantially all of the amortization expense is recognized within one year of purchase.

In the second quarter of 2013, we completed a review of our content library amortization methodology and updated the methodology in order to add greater precision to product cost amortization. The previous method recognized accelerated amortization of content library costs at a rate faster than the decline in the content library's value due to the recognition of charges in addition to the normal rental curve amortization whenever individual discs were removed from kiosks, a process we define as "thinning". The Company's most recent analysis has shown that its amortization curves can reasonably capture the effect of thinning and therefore eliminates the need for additional charges at the time of thinning and provides a better correlation of costs to revenue. The modified approach to amortizing the cost of the content library is based on updated rental curves, which incorporate thinning estimates, and provides a more systematic method for recognizing the costs of movie and game titles that better aligns the recognition of costs with the related revenue.

The Company believes that the change in its content library amortization methodology, made on a prospective basis, is a change in accounting estimate that is affected by a change in accounting principle. The Company believes that the modified content library amortization methodology is preferable because it better reflects the pattern of consumption of the expected benefits of the content library. A copy of our auditor's preferability letter is filed as an exhibit to our 10-Q for the period ended June 30, 2013.

The effect of this change resulted in a reduction of product costs, as reported in direct operating expenses, of approximately $21.7 million in the second quarter of 2013, with those costs shifted to primarily the third and fourth quarters and some into 2014. The change resulted in a corresponding increase to the balance of our content library. In addition, the change in amortization methodology shifted product costs on titles purchased during the second half of 2013 into 2014 as amortization is less accelerated than under the prior method. Under the modified amortization methodology we continue to recognize substantially all of the amortization expense within one year of purchase. For year ended December 31, 2013, the change resulted in a total pretax benefit of $31.8 million or $1.17 per basic share and $1.12 per diluted share.

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve the efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the following approximate useful lives:

	Useful Life
Coin-counting kiosks and components	2 - 10 years
Redbox kiosks and components	3 - 5 years
ecoATM kiosk and components	5 years
Computers and software	3 - 5 years
Office furniture and equipment	5 - 7 years
Leased vehicles	3 - 6 years
Leasehold improvements (shorter of life of asset or remaining lease term)	1 - 11 years

Internal-Use Software

We capitalize costs incurred to develop or obtain internal-use software during the application development stage. Capitalization of software development costs occurs after the preliminary project stage is complete, management authorizes the project, and it is probable that the project will be completed and the software will be used for the function intended. We expense costs incurred for training, data conversion, and maintenance, as well as spending in the post-implementation stage. A subsequent addition, modification or upgrade to internal-use software is capitalized only to the extent that it enables the software to perform a task it previously could not perform. The internal-use software is included in computers and software under property and equipment in our Consolidated Balance Sheets. We amortize the internal-use software based on the estimated useful life on a straight-line basis.

Intangible Assets Subject to Amortization

Our intangible assets subject to amortization are primarily composed of developed technology and retailer relationships acquired in connection with our acquisitions. We used expectations of future cash flows, with appropriate discount rates based on the stage of the enterprise acquired, to estimate the fair value of our intangible assets. We amortize our intangible assets on a straight-line basis over their expected useful lives.

Goodwill

Goodwill represents the excess purchase price of an acquired enterprise or assets over the estimated fair value of identifiable net assets acquired. We assess goodwill for potential impairment at the reporting unit level on an annual basis as of November 30, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. We may assess qualitative factors to make this determination, or bypass such a qualitative assessment and proceed directly to testing goodwill for impairment using a two-step process. Qualitative factors we may consider include, but are not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments and entity specific factors such as strategies and financial performance. If, after completing such assessment, it is determined more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a two-step impairment test, whereby the first step is comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the test is not performed. The second step of the impairment test is performed when the carrying amount of the reporting unit exceeds the fair value, then the implied fair value of the reporting unit goodwill is compared with the carrying amount of that goodwill. If the carrying amount of the reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to the excess. For additional information see Note 6: Goodwill and Other Intangible Assets.

Lives and Recoverability of Equipment and Other Long-Lived Assets

We evaluate the estimated remaining life and recoverability of equipment and other assets, including intangible assets subject to amortization, whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Factors that would indicate potential impairment include, but are not limited to, significant decreases in the market value of the long-lived asset(s), a significant change in the long-lived asset’s use or physical condition, and operating or cash flow losses associated with the use of the long-lived asset. When there is an indication of impairment, we prepare an estimate of future undiscounted cash flows expected to result from the use of the asset and its eventual disposition to test recoverability. If the sum of the future undiscounted cash flow is less than the carrying value of the asset, it indicates that the long-lived asset is not recoverable, in which case we will then compare the estimated fair value to its carrying value. If the estimated fair value is less than the carrying value of the asset, we recognize the impairment loss and adjust the carrying amount of the asset to its estimated fair value.

During the fourth quarter of 2013, we discontinued three new venture concepts, Rubi^TM, Crisp Market^TM and Star Studio^TM. During the second quarter of 2013 we discontinued our Orango^TM concept. As a result of the decision to discontinue the four concepts, for each concept we estimated the fair value of assets held utilizing a cash flow approach. For each of the concepts and for certain shared service assets used for the new ventures, as of December 31, 2013, we estimated the fair value of the assets was zero and recorded impairment charges for each concept. See Note 12: Discontinued Operationsfor additional information.

On January 23, 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the Company's performance expectations. On March 31, 2015, we completed the disposal of the Redbox Canada operations. As a result, we updated certain estimates used in the preparation of the financial statements and the remaining value of certain capitalized property and equipment, consisting primarily of installation costs, was amortized over the wind-down period ending March 31, 2015. See Note 12: Discontinued Operationsfor additional information.

Income Taxes

Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of our assets and liabilities and operating loss and tax credit carryforwards. We record a valuation allowance to reduce deferred tax assets to the amount expected to more likely than not be realized in our future tax returns. Deferred tax assets and liabilities and operating loss and tax credit carryforwards are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and operating loss and tax credit carryforwards are expected to be recovered or settled.

We assess our income tax positions and record tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate or effective settlement with a taxing authority that has full knowledge of all relevant information. In the event of a tax position where it would not be more likely than not that a tax benefit would be sustained, no tax benefit would be recognized in the financial statements. When applicable, associated interest and penalties have been recognized as a component of income tax expense. See Note 18: Income Taxes From Continuing Operations for additional information.

Taxes Collected from Customers and Remitted to Governmental Authorities

We account for tax assessed by a governmental authority that is directly imposed on a revenue-producing transaction (i.e., sales, value added) on a net (excluded from revenue) basis.

Convertible Debt

In September 2009, we issued $200.0 million aggregate principal amount of 4% Convertible Senior Notes (the “Convertible Notes”). The Convertible Notes were convertible as of December 31, 2013 and the debt conversion feature was classified as temporary equity on our Consolidated Balance Sheets. On September 2, 2014, the Convertible Notes matured. In 2014, we retired or settled upon maturity, a combined 51,148 Convertible Notes for total consideration of $51.1 million in cash and the issuance of 431,760 shares of common stock. The amount by which total consideration exceeded the fair value of the Convertible Notes has been recorded as a reduction of stockholders’ equity. The loss from early extinguishment of the Convertible Notes was approximately $0.3 million and is recorded in interest expense in our Consolidated Statements of Comprehensive Income.

Loss Contingencies

We accrue estimated liabilities for loss contingencies arising from claims, assessments, litigation and other sources when it is probable that a liability has been incurred and the amount of the claim assessment or damages can be reasonably estimated. We believe that we have sufficient accruals to cover any obligations resulting from claims, assessments or litigation that have met these criteria.

Revenue Recognition

We recognize revenue when persuasive evidence of a sale arrangement exists, delivery has occurred or services are rendered, the sales price or fee is fixed or determinable and collectability is reasonably assured as follows:

• Redbox - Revenue from movie and video game rentals is recognized ratably over the term of a consumer’s rental transaction. Revenue from a direct sale out of the kiosk of previously rented movies or video games is recognized at the time of sale. On rental transactions for which the related movie or video game has not yet been returned to the kiosk at month-end, revenue is recognized with a corresponding receivable recorded in the balance sheet, net of a reserve for potentially uncollectible amounts. We record revenue net of refunds and applicable sales taxes collected from consumers. In the fourth quarter of 2014, Redbox launched Redbox Play Pass, a new loyalty program, where customers can earn points redeemable for movie rentals. As customers accumulate points, we defer the estimated fair value of the points earned as deferred revenue (included within other current accrued liabilities). We deferred $2.5 million and $1.5 million as of December 31, 2015 and December 31, 2014, respectively. 

• Coinstar - Revenue from a coin transaction, which is collected from either consumers or card issuers (in stored value product transactions), is recognized at the time the consumers’ coins are collected by our coin-counting kiosks. Our revenue represents the fee charged for coin transactions.

• ecoATM - Revenue is recognized upon the sale and shipment of devices collected to third parties and consumers.

• All Other - Revenue was recognized in our discontinued SAMPLEit concept when the service transaction was completed.

Fees Paid to Retailers

Fees paid to retailers relate to the amount we pay our retailers for the benefit of placing our kiosks in their stores and their agreement to provide certain services on our behalf to our consumers. The fee is generally calculated as a percentage of each coin-counting transaction or as a percentage of our net movie or video game rental revenue or a fixed fee and is recorded in our Consolidated Statements of Comprehensive Income within Direct operating expenses. The fee arrangements are based on our negotiations and evaluation of certain factors with the retailers such as total revenue, long-term non-cancelable contracts, installation of our kiosks in high traffic and/or urban or rural locations, co-op marketing incentives, or other criteria.

Advertising

Advertising costs, which are included as a component of marketing expenses, are expensed as incurred and totaled $15.2 million, $11.8 million and $11.7 million in 2015, 2014 and 2013, respectively.

Research and Development

Costs incurred for research and development activities are expensed as incurred.

Foreign Currency Translation

The functional currencies of our international subsidiaries are the British pound Sterling for our subsidiary Coinstar Limited in the United Kingdom, Canadian dollar for Coinstar International and Redbox Canada GP, and the Euro for our Coinstar Ireland Limited subsidiary. We translate assets and liabilities related to these operations to U.S. dollars at the exchange rate in effect at the date of the Consolidated Balance Sheets; we convert revenues and expenses into U.S. dollars using average exchange rates. Transaction gains and losses including on foreign currency intercompany transactions not deemed to be of a long term investment nature are included in Other income (expense), net on our Consolidated Statements of Comprehensive Income, except for those associated with discontinued operations which are included in Loss from discontinued operations, net of tax on our Consolidated Statements of Comprehensive Income. Translation gains and losses, including gains and losses on foreign currency intercompany transactions deemed to be of a long term investment nature, are reported as Accumulated other comprehensive loss in our Consolidated Balance Sheets.

Share-Based Payments

We measure and recognize expense for all share-based payment awards granted, including employee stock options and restricted stock awards, based on the estimated fair value of the award on the grant date. We utilize the Black-Scholes-Merton (“BSM”) valuation model for valuing our stock option awards and the determination of the expenses.

The use of the BSM valuation model to estimate the fair value of stock option awards requires us to make judgments on assumptions regarding the risk-free interest rate, expected dividend yield, expected term and expected volatility over the expected term of the award. The assumptions used in calculating the fair value of share-based payment awards represent management’s best estimates at the time they are made, but these estimates involve inherent uncertainties and the determination of expense could be materially different in the future.

We amortize share-based payment expense on a straight-line basis over the vesting period of the individual award with estimated forfeitures considered. Vesting periods are generally four years. Expense for performance based shares is recognized over the vesting period if and when we conclude that it is probable that the performance condition will be achieved. We reassess the probability of vesting at each reporting period for awards with performance conditions and adjust compensation cost based on our probability assessment.

Shares to be issued upon the exercise of stock options will come from newly issued shares. The expense related to restricted stock granted to movie studios as part of license agreements is adjusted based on the number of unvested shares and market price of our common stock each reporting period.

Share-based payment expense is only recognized on awards that ultimately vest. Therefore, we have reduced the share-based payment expense to be recognized over the vesting period for anticipated future forfeitures. Forfeiture estimates are based on historical forfeiture patterns. We review and assess our forfeiture estimates quarterly and update them if necessary. Any changes to accumulated share-based payment expense are recognized in the period of change. If actual forfeitures differ significantly from our estimates, our results of operations could be materially impacted. For additional information see Note 10: Share-Based Payments.

Fair Value of Financial Instruments

The carrying amounts for cash equivalents approximate fair value, which is the amount for which the instrument could be exchanged in a current transaction between willing parties. Available-for-sale securities are marked to fair value on a quarterly basis. The fair value of our revolving line of credit approximates its carrying amount. For additional information see Note 15: Fair Value.

Reclassifications

To be consistent with our 2015 reporting, the following have been retrospectively reported in our Consolidated Statements of Comprehensive Income for all periods presented with no effect on net income, cash flows or stockholder's equity:

• Results of our Redbox Canada operations which were discontinued during the first quarter of 2015. See Note 12: Discontinued Operationsforadditional information;

• Restructuring and related costs. See Note 11: Restructuring for additional information; and

• Basic and diluted earnings per share as a result of applying the two-class method of calculating earnings per share (the “Two-Class Method”). During the first quarter of 2015, the Two-Class Method became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards (“participating securities”) as a percentage of total common shares outstanding. The impact of applying the Two-Class Method on both income from continuing operations and basic and diluted weighted average shares used to calculate earnings per common share is as follows:

	As Reported Under the Treasury Stock Method				Amount Allocated to Participating Securities						As Revised Under the Two-Class Method
In thousands, except per share data	2014		2013		2014			2013			2014		2013
Income from continuing operations used in basic per share calculation	$	124,677	$	222,688	$	(3,929	)	$	(5,473	)	$	120,748	$	217,215
Income from continuing operations used in diluted per share calculation	$	124,677	$	222,688	$	(3,871	)	$	(5,294	)	$	120,806	$	217,394
Weighted average shares used in basic per share calculation	20,192		27,216		—			—			20,192		27,216
Weighted average shares used in diluted per share calculation	20,699		28,381		(196		)	(212		)	20,503		28,169
Basic earnings per common share from continuing operations	$	6.17	$	8.18	$	(0.19	)	$	(0.20	)	$	5.98	$	7.98
Diluted earnings per common share from continuing operations	$	6.02	$	7.85	$	(0.13	)	$	(0.13	)	$	5.89	$	7.72

See Note 13: Earnings Per Sharefor additional information.

The accompanying consolidated financial statements include the accounts of Outerwall Inc. and our wholly-owned subsidiaries. Investments in companies of which we may have significant influence, but not a controlling interest, are accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

Accounting Pronouncements Adopted During the Current Year

In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360) Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU 2014-08 changes the requirements for reporting discontinued operations. Under the ASU discontinued operations is defined as a:

• Component of an entity, or group of components, that

◦ has been disposed of, meets the criteria to be classified as held-for-sale, or has been abandoned/spun-off and

◦ represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, or a

◦ business or nonprofit activity that, on acquisition, meets the criteria to be classified as held-for-sale.

We adopted the provisions of ASU 2014-08 during the first quarter of 2015 and applied the guidance to our disposition of our Redbox operations in Canada (“Redbox Canada”). See Note 12: Discontinued Operationsfor additional information.

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This ASU requires all deferred tax assets and liabilities to be presented in the balance sheet as noncurrent and is effective for us in our fiscal year beginning January 1, 2016. We elected to early adopt this new guidance in the fourth quarter of 2015 and have applied the changes retrospectively. The changes to our 2014 Consolidated Balance Sheet as a result of adopting the new guidance are as follow:

In thousands, except per share data	As Reported		Reclassifications			As Revised
Assets:
Prepaid expenses and other current assets	$	39,837	$	(18	)	$	39,819
Deferred income taxes - long term	$	11,378	$	(15	)	$	11,363
Liabilities:
Deferred income taxes - current	$	21,432	$	(21,432	)	$	—
Deferred income taxes - long term	$	38,375	$	21,399		$	59,774

Accounting Pronouncements Not Yet Adopted

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30). This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, instead of as a deferred charge. In August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements (Subtopic 835-30). This ASU provides additional guidance to ASU 2015-03, which did not address presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-15 noted that the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted. As of December 31, 2015, we had $3.8 million of deferred financing fees recorded in other long-term assets in our Consolidated Balance Sheets.

In April 2015, the FASB issued ASU 2015-05, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. This ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The guidance will not change GAAP for a customer’s accounting for service contracts. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB deferred the effective date for annual reporting periods beginning after December 15, 2017. Early adoption is permitted to the original effective date of December 15, 2016. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. We are currently in the process of evaluating the impact of ASU 2014-09.

In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This ASU describes how an entity’s management should assess whether there are conditions and events that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management should consider both quantitative and qualitative factors in making its assessment.

If after considering management’s plans, substantial doubt about an entity’s going concern is alleviated, an entity shall disclose information in the footnotes that enables the users of the financial statements to understand the events that raised the going concern and how management’s plan alleviated this concern.

If after considering management’s plans, substantial doubt about an entity’s going concern is not alleviated, the entity shall disclose in the footnotes indicating that a substantial doubt about the entity’s going concern exists within one year of the date of the issued financial statements. Additionally, the entity shall disclose the events that led to this going concern and management’s plans to mitigate them.

We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

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Business Combinations

12 Months Ended

Dec. 31, 2015

Business Combinations [Abstract]

Business Combinations

Note 3: Business Combinations

Acquisition of Gazelle, Inc.,

On October 29, 2015, Outerwall Inc. entered into an asset purchase agreement (the “Agreement”) with Gazelle, Inc., a Delaware corporation ("Gazelle") that provides consumers an on-line solution for the sale and purchase of used mobile phones, computers and tablets. This taxable transaction closed on November 10, 2015. The primary reasons for the business combination were to help drive our ecoATM business to profitability, provide margin and revenue uplift opportunities, and leverage a direct-to-consumer channel for collected devices.

We accounted for the purchase of Gazelle as a business combination. Costs related to this acquisition of approximately $0.3 million were expensed during the fourth quarter of 2015 and are included within general and administrative expenses in our Consolidated Statements of Comprehensive Income.

The following table shows the consideration transferred and the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation.

Dollars in thousands	November 10, 2015
Total consideration transferred	$	17,980
Assets acquired:
Accounts receivable	$	67
Prepaid expenses and other current assets	3,963
Property and equipment	252
Intangible assets	16,000
Total assets acquired	20,282
Liabilities assumed:
Deferred revenue	(750		)
Deferred tax liabilities	(563		)
Total liabilities assumed	(1,313		)
Total net assets acquired	$	18,969
Bargain purchase gain	$	989

The assets acquired and liabilities assumed, as well as the results of operations from the date of the acquisition, are included within our ecoATM segment. The purchase priced allocation resulted in the recognition of a gain on bargain purchase of approximately $1.0 million, which was included within other, net in our Consolidated Statements of Comprehensive Income. The gain on bargain purchase is primarily the result of acquiring certain assets of Gazelle, including the Gazelle trade name, in a transaction under which the previous investors were motivated to sell due to short-term liquidity concerns.

Acquired identifiable intangible assets and their estimated useful life in years are as follows:

Dollars in thousands	Purchase Price		Estimated Useful Life in Years
Trade name	$	14,000	10
Developed technology	$	2,000	3

The following table shows the revenue and operating loss included in our Consolidated Statements of Comprehensive Income resulting from the acquisition of Gazelle since the closing date, including the amortization for acquired intangibles which are included in our ecoATM segment:

	Year Ended
Dollars in thousands	December 31, 2015
Revenue	$	13,269
Operating loss	$	948

Pro forma information

The following unaudited pro forma information represents the results of operations for Outerwall Inc. and includes the Gazelle business acquired as if the acquisition was consummated as of January 1, 2014.

	Years Ended December 31,
	(Unaudited)
Dollars in thousands	2015		2014
Pro-forma revenue	$	2,264,467	$	2,378,508
Pro-forma income from continuing operations	$	38,524	$	114,641

The unaudited pro forma results have been adjusted with respect to certain aspects of our acquisition of Gazelle to reflect:

• changes in assets to record their acquisition date fair values and the resulting changes in amortization;

• adjustments for the bargain purchase gain and costs related to the acquisition; and

• the income tax impact of the pro forma adjustments at a combined federal and state statutory rate of 37.5%.

The unaudited pro forma results do not reflect future events that may occur after the acquisition, including, but not limited to, the anticipated realization of ongoing savings from operating synergies in subsequent periods.

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Prepaid Expenses and Other Current Assets and Other Accrued Liabilities

12 Months Ended

Dec. 31, 2015

Prepaid Expenses and Other Current Assets and Other Accrued Liabilities [Abstract]

Prepaid Expenses and Other Current Assets and Other Accrued Liabilities

Note 4: Prepaid Expenses and Other Current Assets and Other Accrued Liabilities

Prepaid expenses and other current assets

	December 31,
Dollars in thousands	2015		2014
Spare parts	$	9,780	$	13,643
Licenses	6,394		5,881
Electronic devices inventory	7,846		5,259
Income taxes receivable	9,517		95
Prepaid rent	1,043		1,446
DVD cases and labels	1,371		1,330
Other	15,417		12,165
Total prepaid and other current assets	$	51,368	$	39,819

Other accrued liabilities

	December 31,
Dollars in thousands	2015		2014
Payroll related expenses	$	40,676	$	33,343
Studio revenue share and other content related expenses	28,964		23,226
Business taxes	16,080		21,629
Insurance	13,594		9,615
Deferred revenue	11,201		6,995
Income taxes payable	16		9,463
Accrued interest expense	6,913		6,974
Accrued early lease termination and sublease expenses	4,991		—
Service contract provider expenses	4,070		4,191
Deferred rent expense	1,728		6,162
Other	13,204		15,528
Total other accrued liabilities	$	141,437	$	137,126

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Property and Equipment

12 Months Ended

Dec. 31, 2015

Property, Plant and Equipment [Abstract]

Property and Equipment

Note 5: Property and Equipment

	December 31,
Dollars in thousands	2015			2014
Kiosks and components	$	1,163,210		$	1,165,925
Computers, servers, and software	193,507			200,915
Leasehold improvements	22,663			29,625
Office furniture and equipment	7,047			9,218
Vehicles	5,118			6,234
Property and equipment, at cost	1,391,545			1,411,917
Accumulated depreciation and amortization	(1,075,532		)	(983,449		)
Property and equipment, net	$	316,013		$	428,468

During 2015 we recognized:

• $5.0 million of accelerated depreciation as a result of our decision to discontinue operating SAMPLEit. See Note 14: Business Segments and Enterprise-Wide Information for additional information; and

• $7.4 million of impairment charges in connection with our early lease termination. See Note 11: Restructuring for additional information.

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Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Note 6: Goodwill and Other Intangible Assets

Goodwill

We assess goodwill for potential impairment at the reporting unit level on an annual basis as of November 30, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. During the three months ended June 30, 2015, it became evident that revenue and profitability trends in our ecoATM reporting unit were not being achieved as expected. For example collection rates, revenue and profitability on a per kiosk basis experienced declines versus prior periods and expected seasonal trends. As a result, we revised our internal expectations for future revenue growth and profitability lower than our previous estimates. This is primarily driven by certain challenges in an increasingly competitive industry which impact the per kiosk device collection, revenue and profitability expectations and the timing and installation of kiosks. Further, while these competitive challenges grew more acute during the second quarter, we also experienced the loss of a key executive at ecoATM. This led to an indication in the second quarter of 2015 that ecoATM’s fair value was more likely than not below its carrying value.

As a result, we performed the first step of the goodwill impairment test with the assistance of a third-party valuation specialist. The first step of the impairment test was completed by comparing the carrying value of ecoATM, including goodwill, to its fair value determined using a weighted combination of a discounted cash flow (“DCF”) income based approach and a guideline public company market based approach. The DCF methodology requires significant judgment in selecting appropriate inputs including the risk adjusted market cost of capital for the discount rate, the terminal growth rate and projections of future cash flows, all of which are inherently uncertain. The guideline public company method involves significant judgment in selecting the appropriate inputs including the peer company group, the selection of relevant multiples and the determination of a reasonable control premium. Due to these significant judgments, the fair value determined in connection with the goodwill impairment test may not necessarily be indicative of the actual value that would be recognized in a future transaction. Completion of the first step of the impairment test determined that the carrying amount of ecoATM exceeded its fair value and that the second step of the impairment test needed to be performed.

Under the second step of the impairment test, we completed the process of estimating the fair value of ecoATM’s assets and liabilities, including intangible assets consisting of developed technology, trade name and covenants not to compete for the purpose of deriving an estimate of the implied fair value of goodwill. The estimate of the implied fair value of goodwill was then compared to the recorded goodwill to determine the amount of the impairment. Significant assumptions used in measuring the value of these assets and liabilities included the discount rates and obsolescence rates used in valuing the intangible assets, and replacement costs for valuing the tangible assets. The inputs and assumptions used in our goodwill impairment test are classified as Level 3 inputs within the fair value hierarchy.

Based on the result of the second step of the goodwill impairment analysis, we recognized a non-cash, non-tax deductible charge for goodwill impairment of $85.9 million related to our ecoATM business segment in the second quarter of 2015.

As a result of the impairment recorded, the estimated fair value of the ecoATM reporting unit equaled its carrying value as of June 30, 2015.

Gross amount of goodwill and accumulated impairment charges that we have recorded are as follows:

Dollars in thousands
Goodwill	$	559,307
Accumulated impairment losses	(85,890		)
Net goodwill at December 31, 2015	$	473,417

Goodwill by Segment

A reconciliation of the beginning and ending carrying amounts of goodwill by segment is as follows:

Dollars in thousands	December 31, 2014		Goodwill Impairment			December 31, 2015
Redbox	$	138,743	$	—		$	138,743
Coinstar	156,351		—			156,351
ecoATM	264,213		(85,890		)	178,323
Total goodwill	$	559,307	$	(85,890	)	$	473,417

We elected to by-pass the qualitative assessment and performed the annual goodwill impairment test based on a quantitative analysis as of November 30, 2015. We estimated the fair value of our goodwill bearing reporting units using both the income and market approaches and reconciled these approaches to our enterprise market capitalization as of November 30, considering a reasonable control premium. Our estimates of fair value can change significantly based on factors such as revenue growth rates, profit margins, discount rates, market conditions, market prices, and changes in business strategies. As the estimated fair value of each reporting unit exceeded its respective carrying value in the first step of the goodwill impairment test it was not necessary to proceed to the second step and there was no additional goodwill impairment in 2015. Subsequent to our testing date of November 30, we also considered the change in our market capitalization between the measurement date and December 31, 2015 and subsequent to our fiscal year end. Considering factors such as the average price of our stock during 2015, in conjunction with the other methodologies and factors noted above, we determined that the decrease in our market capitalization did not change our conclusions made as of the measurement date.

The acquired assets and liabilities of Gazelle (See Note 3: Business Combinations for further information), are included in the carrying value of our ecoATM reporting unit. The estimate of ecoATM's fair value as of November 30, 2015, included the expected increase in our estimated future cash flows from the Gazelle acquisition. The expected future cash flows of our ecoATM reporting unit include key assumptions with inherent uncertainty which may change in future periods and may have a negative effect on the fair value resulting in potential future impairments, the most significant of which is our estimate of future cash flows predicated on estimated growth in kiosks, revenue and profitability measures. Additionally, fair value may be negatively impacted by changes in our strategy related to the ecoATM reporting unit and factors outside of our control such as increased competition from companies whose primary business consists of the purchase of used electronics and with companies in other businesses who also have buyback programs.

Excluding the impact of Gazelle on the fair value and carrying value of the ecoATM reporting unit, there have been no significant changes in our expectations for the ecoATM reporting unit from the June 30, 2015 valuation date, when the estimated fair value of the ecoATM reporting unit equaled its carrying value, to the November 30, 2015 annual measurement date, that indicated the carrying value of the ecoATM reporting unit exceeded its fair value as of November 30, 2015.

Other Intangible Assets

The gross amount of our other intangible assets and the related accumulated amortization were as follows:

Dollars in thousands	Amortization	December 31,
	Period	2015			2014
Retailer relationships	5 - 10 years	$	53,295		$	53,295
Accumulated amortization		(27,212		)	(23,200		)
Retailer relationships, net		26,083			30,095
Developed technology	3 - 5 years	36,000			34,000
Accumulated amortization		(16,544		)	(9,633		)
Developed technology, net		19,456			24,367
Trade names	5 - 10 years	20,000			6,000
Accumulated amortization		(3,133		)	(1,700		)
Trade names, net		16,867			4,300
Other	1 - 40 years	10,800			10,800
Accumulated amortization		(6,109		)	(4,871		)
Other, net		4,691			5,929
Total intangible assets, net		$	67,097		$	64,691

Amortization expense was as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Retailer relationships	$	4,012		$	5,432		$	6,250
Developed technology	6,911			6,800			2,833
Trade names	1,433			1,200			500
Other	1,238			1,260			1,350
Total amortization of intangible assets	$	13,594		$	14,692		$	10,933
Less: amortization included in discontinued operations	(44		)	(38		)	(26		)
Total amortization of intangible assets from continuing operations	$	13,550		$	14,654		$	10,907

Assuming no future impairment, the expected future amortization as of December 31, 2015, is as follows:

Dollars in thousands	Retailer Relationships		Developed Technology		Trade Names		Other		Total
2016	$	4,012	$	7,467	$	2,600	$	1,081	$	15,160
2017	4,012		7,467		2,600		1,081		15,160
2018	4,012		4,522		2,100		964		11,598
2019	4,012		—		1,400		801		6,213
2020	4,012		—		1,400		407		5,819
Thereafter	6,023		—		6,767		357		13,147
Total expected amortization	$	26,083	$	19,456	$	16,867	$	4,691	$	67,097

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Equity Method Investments

12 Months Ended

Dec. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments

Note 7: Equity Method Investments

Redbox Instant^™ by Verizon

In February 2012, Redbox and Verizon Ventures IV LLC (“Verizon”), a wholly owned subsidiary of Verizon Communications Inc., entered into a Limited Liability Company Agreement (the “LLC Agreement”) and related arrangements. The LLC Agreement governed the relationship of the parties with respect to a joint venture, Redbox Instant by Verizon (the “Joint Venture”). Redbox initially acquired a 35.0% ownership interest in the Joint Venture and made an initial capital contribution of $14.0 million in cash in February 2012 subsequent to the formation of the Joint Venture. The following table summarizes Redbox's initial cash capital contribution and subsequent cash capital contributions representing its pro-rata share of requests made by the Joint Venture board of managers:

Dollars in thousands	Cash Contributions
2012	$	24,500
2013	28,000
2014	24,500
Total cash capital contributions	$	77,000

On October 19, 2014, the Company and Verizon entered into an agreement whereby we would withdraw from the Joint Venture effective October 20, 2014. Pursuant to the agreement, all of Redbox’s rights under the Joint Venture’s operating agreement were extinguished for a total payment of $16.8 million made to Redbox and no further capital contributions were required. The $16.8 million payment received was composed of an $11.8 million expense reimbursement payment to satisfy all outstanding amounts due and additional expenses incurred by Redbox inclusive of transition services performed for the Joint Venture to Redbox and a $5.0 million extinguishment payment which is included within Income (loss) from equity method investments within our Consolidated Statements of Comprehensive Income.

Other Equity Method Investments

We include our equity method investments within other long-term assets on our Consolidated Balance Sheets. As of December 31, 2015, our $0.7 million investment in Pursuant Health, Inc., formerly known as SoloHealth, Inc., representing approximately 10% ownership, was our only equity method investment.

Since we acquired ecoATM on July 23, 2013, the results of ecoATM operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment. See Note 14: Business Segments and Enterprise-Wide Information for more information.

Income (Loss) from Equity Method Investments and Summarized Financial Information

Income (loss) from equity method investments within our Consolidated Statements of Comprehensive Income is composed of the following:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Gain on previously held equity interest on ecoATM	$	—		$	—		$	68,376
Proportionate share of net loss of equity method investees:
Joint Venture	—			(25,793		)	(42,660		)
Pursuant Health and ecoATM	(800		)	(530		)	(3,313		)
Total proportionate share of net loss of equity method investees	(800		)	(26,323		)	(45,973		)
Amortization of difference in carrying amount and underlying equity in Joint Venture	—			(2,411		)	(2,475		)
Total income (loss) from equity method investments	$	(800	)	$	(28,734	)	$	19,928

A summary of financial information for our equity method investees in the aggregate, as provided to us by the investees, is as follows:

Balance Sheets(1)	December 31,
Dollars in thousands	2015		2014
Current assets	$	3,457	$	3,408
Noncurrent assets	$	13,394	$	20,376
Current liabilities	$	5,888	$	7,321
Long-term liabilities	$	22,811	$	18,754

(1) Represents Pursuant Health, Inc. only.

Statement of Operations	Year Ended December 31,
Dollars in thousands	2015		2014		2013
Revenue	$	7,389	$	29,963	$	15,824
Cost of sales and service	$	10,129	$	68,732	$	25,092
Net loss from continuing operations	$	6,107	$	140,919	$	134,911

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Debt and Other Long-Term Liabilities

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Debt and Other Long-Term Liabilities

Note 8: Debt and Other Long-Term Liabilities

	Debt														Other Liabilities							Total
	Senior Notes						Credit Facility					Total Debt			Capital Lease Obligations			Asset retirement obligations		Other long-term liabilities
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2015:
Principal	$	350,000		$	258,908		$	136,875		$	140,500	$	886,283
Discount	(3,275		)	(3,029		)	(260		)	—		(6,564		)
Total	346,725			255,879			136,615			140,500		879,719			$	5,889		$	9,412	$	19,477	$	914,497
Less: current portion	—			—			(13,125		)	—		(13,125		)	(4,006		)	—		—		(17,131		)
Total long-term portion	$	346,725		$	255,879		$	123,490		$	140,500	$	866,594		$	1,883		$	9,412	$	19,477	$	897,366
Unamortized deferred financing fees(1)	$	495		$	1,054		$	—		$	2,300	$	3,849									$	3,849

	Debt														Other Liabilities							Total
	Senior Notes						Credit Facility					Total Debt			Capital Lease Obligations			Asset retirement obligations		Other long-term liabilities
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2014:
Principal	$	350,000		$	300,000		$	146,250		$	160,000	$	956,250
Discount	(4,296		)	(4,152		)	(335		)	—		(8,783		)
Total	345,704			295,848			145,915			160,000		947,467			$	15,391		$	13,576	$	17,651	$	994,085
Less: current portion	—			—			(9,390		)	—		(9,390		)	(11,026		)	—		—		(20,416		)
Total long-term portion	$	345,704		$	295,848		$	136,525		$	160,000	$	938,077		$	4,365		$	13,576	$	17,651	$	973,669
Unamortized deferred financing fees(1)	$	649		$	1,372		$	—		$	2,965	$	4,986									$	4,986

(1) Deferred financing fees are recorded in other long-term assets in our Consolidated Balance Sheets and are amortized on a straight line basis over the life of the related loan.

Interest Expense

Dollars in thousands	Year Ended December 31,
	2015			2014		2013
Cash interest expense	$	45,507		$	41,562	$	25,289
Non-cash interest expense:
Amortization of debt discount	1,731			2,606		4,674
Amortization of deferred financing fees	1,030			1,510		1,720
Other	—			—		(550		)
Total non-cash interest expense	2,761			4,116		5,844
Total cash and non-cash interest expense	48,268			45,678		31,133
(Gain) loss from early extinguishment of debt	(5,854		)	2,018		6,013
Total interest expense	$	42,414		$	47,696	$	37,146

2019 Notes

On March 12, 2013, we entered into an indenture pursuant to which we issued $350.0 million principal amount of 6.000%Senior Notes due 2019 (the “2019 Notes”) at par for proceeds, net of expenses, of $343.8 million. The expenses were allocated between debt discount and deferred financing fees based on their nature. Each of our direct and indirect U.S. subsidiaries guarantees the 2019 Notes. As of December 31, 2015, we were in compliance with the covenants of the related indenture.

2021 Notes

On June 9, 2014, we entered into an indenture pursuant to which we issued $300.0 million principal amount of 5.875% Senior Notes due 2021 (the "2021 Notes") at par for proceeds, net of expenses, of $294.0 million. The expenses were allocated between debt discount and deferred financing fees based on their nature. Each of our direct and indirect U.S. subsidiaries guarantees the 2021 Notes.

During the second quarter of 2015, we registered the 2021 Notes and related guarantees under the Securities Act of 1933, as amended (the “Securities Act”) to allow holders to exchange the notes and related guarantees for the same principal amount of a new issue and related guarantees (collectively, the “Exchange Notes”) with substantially identical terms, except that the Exchange Notes are generally freely transferable under the Securities Act. The full principal amount of the 2021 Notes was exchanged for the Exchange Notes.

On December 15, 2015, we repurchased 41,092 Notes, or $41.1 million in face value of Notes, for $34.6 million in cash. The gain from early extinguishment of these Notes was approximately $5.9 million and is included in Interest expense, net on our Consolidated Statements of Comprehensive Income.

As of December 31, 2015, we were in compliance with the covenants of the related indenture.

Revolving Line of Credit and Term Loan

On June 24, 2014, we entered into the Third Amended and Restated Credit Agreement (the “Amended and Restated Credit Agreement”) providing for a senior secured credit facility (the "Credit Facility"). The Amended and Restated Credit Agreement amended and restated in its entirety the Second Amended and Restated Credit Agreement dated as of November 20, 2007 and amended and restated as of April 29, 2009 and as of July 15, 2011 and all amendments and restatements thereto. The credit facility provided under the previous credit agreement was replaced by the Credit Facility. As a result of this refinancing activity, we recorded a loss on the extinguishment of the previous credit agreement of $1.7 million in 2014 for certain previously capitalized and unamortized debt issuance costs. The loss on extinguishment is recorded within Interest expense, net in our Consolidated Statements of Comprehensive Income.

The Credit Facility consists of (a) a $150.0 million amortizing term loan (the “Term Loan”) and (b) a $600.0 millionrevolving line of credit (the “Revolving Line”), which includes (i) a $75.0 million sublimit for the issuance of letters of credit, (ii) a $50.0 million sublimit for swingline loans and (iii) a $75.0 million sublimit for loans in certain foreign currencies available to us and certain wholly owned Company foreign subsidiaries (the “Foreign Borrowers”). We may, subject to applicable conditions and subject to obtaining commitments from lenders, request an increase in the Revolving Line of up to$200.0 million in aggregate (the “Accordion”). The interest rate on amounts outstanding under the Credit Facility was 2.29% and 1.92% as of December 31, 2015 and December 31, 2014, respectively.

As of December 31, 2015, we were in compliance with the covenants of the Credit Facility.

The Amended and Restated Credit Agreement requires principal amortization payments under the Term Loan as follows:

Dollars in thousands	Repayment Amount
2016	$	13,125
2017	15,000
2018	18,750
2019	90,000
Total	$	136,875

Convertible Debt

On September 2, 2014, our 4.0% Convertible Senior Notes (the “Convertible Notes”) matured. The Convertible Notes were convertible as of December 31, 2013. In 2014, we retired or settled upon maturity, a combined 51,148 Convertible Notes for total consideration of $51.1 million in cash and the issuance of 431,760shares of common stock. The amount by which total consideration exceeded the fair value of the Convertible Notes has been recorded as a reduction of stockholders’ equity. The loss from early extinguishment of the Convertible Notes was approximately $0.3 million and is recorded in Interest expense, net in our Consolidated Statements of Comprehensive Income.

Asset Retirement Obligation

We have entered into agreements with our partners to place kiosks in their stores. Upon contract terminations, we are obligated to remove the kiosks from the store locations and, accordingly, we recognize the estimated fair value of the liability under the long-term section of our liabilities in our Consolidated Balance Sheets.

Other Long-Term Liabilities

Included in other long-term liabilities were primarily tenant improvements related to our office building renovation in Oakbrook Terrace, Illinois; Bellevue, Washington; and San Diego, California as well as the related unrecognized tax benefits as follows:

Dollars in thousands	December 31,
	2015		2014
Tenant improvement and deferred rent and other	$	12,592	$	13,012
Unrecognized tax benefit	6,885		4,639
Total other long-term liabilities	$	19,477	$	17,651

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Repurchases of Common Stock

12 Months Ended

Dec. 31, 2015

Class of Stock Disclosures [Abstract]

Repurchases Of Common Stock

Note 9: Repurchases of Common Stock

Board Authorization

On February 3, 2015, our Board of Directors approved an additional stock repurchase program of up to $250.0 million of our common stock plus the cash proceeds received from the exercise of stock options by our executives, non-employee directors and employees.

Repurchases

Repurchased shares become a part of treasury stock. The shares tendered for tax withholding on vesting of restricted stock awards do not impact the repurchase program approved by our Board. The following tables present a summary of our 2015 authorized stock repurchase balance and repurchases made during the past three years:

Dollars in thousands	Board Authorization
Authorized repurchase - as of January 1, 2015	$	163,655
Additional board authorization	250,000
Proceeds from the exercise of stock options	2,552
Repurchase of common stock from open market	(159,800		)
Authorized repurchase - as of December 31, 2015	$	256,407

Repurchases made in the year ended December 31,	Number of Shares Repurchased	Average Price per Share (in dollars)		Total Purchase Price (in thousands)
2015	2,514,139	$	63.56	$	159,800
2014
Tender offer(1)	5,291,701	$	70.07	370,789
Open market	2,633,526	$	64.77	170,582
Total 2014	7,925,227	$	68.31	541,371
2013	3,306,433	$	58.98	195,004
Total	13,745,799	$	65.20	$	896,175

(1) Fees and expenses totaling $3.7 million associated with the tender offer do not impact the repurchase program approved by our Board, are excluded from the total purchase price shown here and were recorded as part of the cost of treasury stock in our Consolidated Balance Sheets.

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Share-Based Payments

12 Months Ended

Dec. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Share-Based Payments

Note 10: Share-Based Payments

We currently grant share-based awards to our employees, non-employee directors and consultants under our 2011 Incentive Plan (the “Plan”). The Plan permits the granting of stock options, restricted stock, restricted stock units, and performance-based restricted stock.

The following is the summary of grant information:

Shares in thousands	December 31, 2015
Unissued common stock reserved for issuance under all plans	1,034
Shares available for future grants	979

Certain information regarding our share-based payments is as follows:

	Year Ended December 31,
Dollars in thousands except per share data	2015		2014		2013
Share-based payments expense:
Share-based compensation - stock options	$	293	$	803	$	1,566
Share-based compensation - restricted stock	12,102		11,214		10,504
Share-based payments for content arrangements	4,982		1,367		4,761
Total share-based payments expense	$	17,377	$	13,384	$	16,831
Tax benefit on share-based payments expense	$	6,736	$	5,134	$	6,392
Per share weighted average grant date fair value of stock options granted	$	—	$	—	$	53.90
Per share weighted average grant date fair value of restricted stock granted	$	66.67	$	71.37	$	53.94
Total intrinsic value of stock options exercised	$	1,061	$	3,263	$	10,567
Grant date fair value of restricted stock vested	$	12,631	$	13,036	$	12,641

	December 31, 2015
Dollars in thousands	Unrecognized Share-Based Payments Expense		Weighted-Average Remaining Life
Unrecognized share-based payments expense:
Share-based compensation - stock options	$	149	0.9 years
Share-based compensation - restricted stock	19,032		2.2 years
Share-based payments for content arrangements	1,090		0.8 years
Total unrecognized share-based payments expense	$	20,271

Share-Based Compensation

Stock options

Shares of common stock are issued upon exercise of stock options. The following table presents a summary of stock option activity for 2015:

Shares in thousands	Options		Weighted Average Exercise Price
Outstanding, December 31, 2014	128		$	52.59
Granted	—		$	—
Exercised	(49	)	$	52.10
Canceled, expired, or forfeited	(24	)	$	53.99
Outstanding, December 31, 2015	55		$	52.40

Certain information regarding stock options outstanding as of December 31, 2015, is as follows:

	Options
Shares and intrinsic value in thousands	Outstanding		Exercisable
Number	55		39
Weighted average per share exercise price	$	52.40	$	51.67
Aggregate intrinsic value	$	35	$	35
Weighted average remaining contractual term (in years)	6.33		6.09

Restricted stock and performance based restricted stock awards

Restricted stock awards are granted to eligible executives, non-employee directors and employees. Awards granted to employees and executives vest annually in equal installments overfour years. Non-employee director awards vest one year after the grant date. Performance-based restricted stock awards are granted to executives only, with established performance criteria approved by the Compensation Committee of the Board of Directors. The fair value of non-performance-based awards is based on the market price on the grant date. We estimate forfeitures for restricted stock awards and recognize share-based compensation expense for only those awards expected to vest.

Awards of performance-based restricted stock made prior to 2013, once earned, vest in equal installments overthree years from the date of grant. Awards of performance-based restricted stock made in and subsequent to 2013, once earned, vest in two installments over three years from the date of grant (65% of the award vests two years from the date of grant and the remaining 35% of the award vests three years from the date of grant). The restricted shares require no payment from the grantee. The fair value of performance-based awards is based on achieving specific performance conditions and is recognized over the vesting period.

The following table presents a summary of restricted stock award activity for 2015:

Shares in thousands	Restricted Stock Awards		Weighted Average Grant Date Fair Value
Non-vested, December 31, 2014	609		$	62.35
Granted	352		$	66.67
Vested	(188	)	$	59.09
Forfeited	(217	)	$	65.26
Non-vested, December 31, 2015	556		$	65.86

Share-Based Payments for Content Arrangements

We have granted restricted stock as part of content license agreements with certain movie studios. The expense related to these agreements is included within direct operating expenses in our Consolidated Statements of Comprehensive Income and is adjusted based on the number of unvested shares and market price of our common stock each reporting period. See Note 16: Commitments and Contingencies for more information on changes in commitments to issue restricted stock for content license agreements.

Information related to the shares of restricted stock granted as part of these agreements as of December 31, 2015, is as follows:

Whole shares	Granted	Vested	Unvested
Sony(1)	243,348	243,348	—
Paramount(2)(3)	350,000	350,000	—

(1) Includes 25,000 shares granted and fully vested in the fourth quarter of 2015 due to a one-year contract extension executed in 2015.

(2) Includes 50,000 shares granted and fully vested in the first quarter of 2015 due to a one-year contract extension executed in 2015.

(3) Includes 95,000 shares that vested on January 1, 2015.

On October 16, 2015, Paramount elected to exercise its option to extend our existing content license agreement. This required us to issue 50,000 shares of additional restricted stock to Paramount during the first quarter of 2016, which we issued on January 4, 2016.

Rights to Receive Cash

As a part of the acquisition of ecoATM, we issued replacement awards for unvested restricted stock and options in ecoATM with rights to receive cash equal to the per share merger consideration for restricted stock and net of the exercise price for options. The replacement awards vest in accordance with the terms of the original replaced award. The fair value of the original and replacement awards amounted to $32.1 million, of which $1.4 million was attributed to pre-combination services rendered and included in the calculation of total consideration transferred. The replacement awards are considered liability classified as they represent rights to receive cash. Expense associated with the post-combination awards is recognized net of forfeitures, and cash payments are made in accordance with the awards' vesting schedule, generally on a monthly basis.

We recognized $4.4 million, $13.3 million and $8.7 million in expense associated with the issuance of rights to receive cash for the twelve months endedDecember 31, 2015, 2014 and 2013, respectively. The expected future recognition of expense associated with the rights to receive cash as of December 31, 2015 is as follows:

Dollars in thousands	Expected Expense
2016	$	1,868
2017	284
Remaining total expected expense	$	2,152

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Restructuring

12 Months Ended

Dec. 31, 2015

Restructuring and Related Activities [Abstract]

Restructuring

Note 11: Restructuring

2015 Restructuring

During the first quarter of 2015, we recorded restructuring charges arising from the following activities:

• Discontinuing our Redbox operations in Canada. The disposal was completed on March 31, 2015. See Note 12: Discontinued Operations for further information;

• Reducing the size of our Redbox headquarters facility in Oakbrook Terrace, Illinois through early termination of operating leases for certain floors. We ceased using the office space on March 31, 2015, and the effective date of the early termination is July 31, 2016. Prior to exercising our early termination option, the leases had been scheduled to expire in July 2021; and

• Implementing actions to further align costs with revenues in our continuing operations primarily through workforce reductions across the Company and subleasing a floor of a corporate facility.

The restructuring liability for this workforce reduction was recorded in the first quarter of 2015 in accordance with ASC 420, consistent with management's approval and commitment to the restructuring plan in the first quarter of 2015, and the communication of those plan details to affected employees within that quarter.

During the fourth quarter of 2015, we recorded restructuring charges arising from the following additional activities:

• Discontinuing our SAMPLEit concept, which is recorded in our All Other reporting category. See Note 14: Business Segments and Enterprise-Wide Information for additional information; and

• Continuing to implement actions to further align costs with revenues in our continuing operations primarily through workforce reductions across the Company, a one-time payment to settle an outstanding purchase commitment, and vacating a floor of a corporate facility. See Note 16: Commitments and Contingenciesfor further information related to the purchase commitment.

We recorded the restructuring liabilities in the fourth quarter of 2015 under ASC 712, consistent with management's approval and commitment to the restructuring plan. We had a substantive plan in place, for purposes of ASC 712, based on the fact that the termination benefits to be paid to our employees were similar to the termination benefits historically paid by us, thereby enabling employees to determine the type and amount of benefits they would receive if they were involuntarily terminated. The restructuring liability represented our obligation related to our employees' rights to receive compensation attributable to services already rendered, which rights had already vested or accumulated. Due to the fact that management had approved and committed to the restructuring plan and based on historical experience, payment of the severance was probable and the amount was reasonably estimated.

We do not expect significant future restructuring charges related to our 2015 restructuring activities. The total amount incurred for restructuring, exclusive of asset impairments incurred by reportable segment (on an allocated basis) and expense type is as follows:

	Year Ended December 31,
Dollars in thousands	2015
Redbox
Severance	$	4,236
Lease termination and related costs (excluding related asset impairments)	4,958
Purchase commitment settlement costs	7,021
Total Redbox restructuring costs	16,215
Coinstar
Severance	492
Lease termination and related costs (excluding related asset impairments)	100
Purchase commitment settlement costs	1,369
Total Coinstar restructuring costs	1,961
ecoATM
Severance	602
Lease termination and related costs (excluding related asset impairments)	—
Purchase commitment settlement costs	85
Total ecoATM restructuring costs	687
All Other
Severance	822
Lease termination and related costs (excluding related asset impairments)	2
Purchase commitment settlement costs	26
Total All Other restructuring costs	850
Total restructuring costs in continuing operations	19,713
Restructuring costs in discontinued operations	522
Total restructuring costs	$	20,235

During 2015, we recognized $27.7 million in charges in connection with our restructuring and related costs including $7.4 million in impairments of lease related assets, and $20.2 million in restructuring costs, which include severance, net lease termination costs and a one-time payment to settle an outstanding purchase commitment.

	Year Ended December 31,
Dollars in thousands	2015
Restructuring costs	$	20,235
Impairment of lease related assets (see Note 5)	7,440
Total restructuring and related costs	27,675
Less: restructuring costs included in discontinued operations	(522		)
Restructuring and related costs from continuing operations	$	27,153

A reconciliation of the beginning and ending liability balance by expense type is as follows:

Dollars in thousands	Severance Expense			Lease Termination Costs			Other
Beginning Balance - January 1, 2015	$	—		$	—		$	—
Costs charged to expense(1)	6,284			5,138			8,813
Reclassification of deferred balances(2)	—			5,260			—
Costs paid or otherwise settled	(4,899		)	(5,407		)	(8,813		)
Ending Balance - December 31, 2015	$	1,385		$	4,991		$	—

(1) Other includes an $8.5 million one-time payment to settle an outstanding purchase commitment.

(2) Deferred rent liabilities related to the early lease termination that were reclassified to present the outstanding liability related to the terminated leases.

2013 Restructuring

During the fourth quarter of 2013, as a result of a comprehensive operational review, we committed to a restructuring plan intended to, among other things, better align our cost structure with revenue growth in our core businesses. As part of the plan, we discontinued the Rubi, Crisp Market, and Star Studio concepts (see Note 12: Discontinued Operations for further information). Also as part of the restructuring plan, we implemented actions to reduce costs in our continuing operations primarily through workforce reductions across the Company. The closure of all discontinued ventures and the workforce reductions were completed in 2014.

The restructuring liabilities for the workforce reductions were recorded in the fourth quarter of 2013 and in 2014 in accordance with ASC 420, consistent with management's approval and commitment to the restructuring plan, and the communication of plan details to affected employees.

The total amount incurred for restructuring, exclusive of asset impairments incurred by reportable segment (on an allocated basis) and expense type is as follows:

Dollars in thousands	Cumulative as of December 31, 2014		Year Ended December 31, 2014		Year Ended December 31, 2013
Redbox
Severance	$	4,305	$	534	$	3,771
Coinstar
Severance	747		23		724
Total restructuring costs in continuing operations	5,052		557		4,495
Restructuring costs in discontinued operations	2,899		590		2,309
Total restructuring costs	$	7,951	$	1,147	$	6,804

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Discontinued Operations

12 Months Ended

Dec. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Note 12: Discontinued Operations

On January 23, 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the company's performance expectations. This represents a strategic shift which has a major effect on our operations as it represents a significant geographical area for our Redbox segment and the losses generated were significant to our total operations. On March 31, 2015, we completed the disposal of the Redbox Canada operations. As a result, we updated certain estimates used in the preparation of our financial statements and the remaining value of the content library and certain capitalized property and equipment consisting primarily of installation costs were amortized over the wind-down period ending March 31, 2015. We have reclassified the results of Redbox Canada to discontinued operations for all periods presented in our Consolidated Statements of Comprehensive Income.

In addition to Redbox Canada, during 2013, we discontinued certain new ventures. See below for additional information.

The following table sets forth the components of discontinued operations included in our Consolidated Statements of Comprehensive Income:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Redbox Canada revenue	$	1,972		$	11,417		$	6,816
Certain new ventures revenue	—			100			4,399
Total revenue	$	1,972		$	11,517		$	11,215
Redbox Canada loss before income tax	$	(13,605	)	$	(23,707	)	$	(19,830	)
Certain new ventures loss before income tax	—			(1,259		)	(54,395		)
Total loss before income tax:	(13,605		)	(24,966		)	(74,225		)
Redbox Canada income tax benefit	8,496			6,416			5,233
Certain new ventures income tax benefit	—			491			21,096
Total income tax benefit	8,496			6,907			26,329
Redbox Canada loss, net of tax	(5,109		)	(17,291		)	(14,597		)
Certain new ventures loss, net of tax	—			(768		)	(33,299		)
Total loss from discontinued operations, net of tax	$	(5,109	)	$	(18,059	)	$	(47,896	)

Redbox Canada

The disposition and operating results of Redbox Canada are presented in discontinued operations in our Consolidated Statements of Comprehensive Income for all periods presented. The following table sets forth the components of discontinued operations included in our Consolidated Statements of Comprehensive Income:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Major classes of line items constituting pretax loss of discontinued operations:
Revenue	$	1,972		$	11,417		$	6,816
Direct operating	4,533			20,027			18,278
Marketing	112			2,947			2,175
Research and development	—			—			2
General and administrative	117			1,078			3,088
Restructuring and related costs	522			—			—
Depreciation and other	5,857			7,354			2,760
Amortization of intangible assets	44			38			26
Other expense, net	(4,392		)	(3,680		)	(317		)
Pretax loss of discontinued operations related to major classes of pretax loss	(13,605		)	(23,707		)	(19,830		)
Income tax benefit(1)	8,496			6,416			5,233
Net loss on discontinued operations	$	(5,109	)	$	(17,291	)	$	(14,597	)

(1) The income tax benefit for 2015 includes a benefit on the rate differential between the U.S. and Canada.

Significant operating and investing cash flows of Redbox Canada were as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Net loss on discontinued operations	$	(5,109	)	$	(17,291	)	$	(14,597	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Depreciation and amortization	5,901			7,392			2,786
Content library	3,328			(787		)	(410		)
Prepaid and other current assets	1,329			(293		)	(516		)
Accounts payable	(2,663		)	627			644
Accrued payables to retailers	(155		)	(175		)	247
Other accrued liabilities	(806		)	(122		)	506
Net cash flows from operating activities	$	1,825		$	(10,649	)	$	(11,340	)
Investing activities:
Purchase of property, plant and equipment	(292		)	(5,494		)	(9,330		)
Total cash flows used in investing activities	$	(292	)	$	(5,494	)	$	(9,330	)

Discontinuation of Certain New Ventures

During 2013, we discontinued four new venture concepts; Rubi, Crisp Market, Orango, and Star Studio. As a result, for each concept we estimated the fair value of assets held utilizing a cash flow approach. For each of the concepts and for certain shared service assets used for the new ventures, we estimated the fair value of the assets was zero and recorded impairment charges for each concept. Total asset impairment charges related to the concepts and relevant shared service assets were recorded in 2013 as follows:

Dollars in thousands	Impairment Expense
Rubi	$	21,317
Orango	5,551
Crisp Market	289
Star Studio	2,786
Corporate assets utilized for discontinued concepts	2,789
Total impairment expense	$	32,732

We completed the wind-down process of all discontinued ventures in 2014. The results of the discontinued ventures and associated impairment and restructuring charges, net of tax, are recorded within Loss from discontinued operations, net of tax in our Consolidated Statements of Comprehensive Income (see Note 11: Restructuring). The continuing cash flows from these operations after discontinuation are insignificant and are not segregated from cash flows from continuing operations in all periods presented in our Consolidated Statements of Cash Flows.

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Earnings Per Share

12 Months Ended

Dec. 31, 2015

Earnings Per Share [Abstract]

Earnings Per Share

Note 13: Earnings Per Share

Beginning in the first quarter of 2015, we began applying the two-class method of calculating basic and diluted earnings per share (the “Two-Class Method”) as it became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards as a percentage of total common shares outstanding.

The Two-Class Method is an earnings allocation formula that treats a participating security, as having rights to earnings that otherwise would have been available to common shareholders and assumes all earnings for the period are distributed. Our unvested service-based restricted stock awards granted are participating securities as they entitle recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to holders of common stock.

Our calculation of basic and diluted earnings per share is as follows:

	Year Ended December 31,
In thousands, except per share data	2015			2014			2013
Numerator
Income from continuing operations	$	49,446		$	124,677		$	222,688
Loss from discontinued operations, net of tax	(5,109		)	(18,059		)	(47,896		)
Net income	$	44,337		$	106,618		$	174,792
Income from continuing operations	$	49,446		$	124,677		$	222,688
Dividends and undistributed income allocated to participating shares	(1,329		)	(3,929		)	(5,473		)
Income from continuing operations to common shares - basic	48,117			120,748			217,215
Effect of reallocating undistributed income from continuing operations to participating shares	1			58			179
Income from continuing operations to common shares - diluted	$	48,118		$	120,806		$	217,394
Denominator
Weighted average common shares - basic	17,467			20,192			27,216
Dilutive effect of share-based payment awards	20			81			235
Dilutive effect of convertible debt	—			230			718
Weighted average common shares - diluted(1)	17,487			20,503			28,169
Basic earnings (loss) per common share:
Continuing operations	$	2.75		$	5.98		$	7.98
Discontinued operations	(0.29		)	(0.89		)	(1.76		)
Basic earnings per common share	$	2.46		$	5.09		$	6.22
Diluted earnings (loss) per common share:
Continuing operations	$	2.75		$	5.89		$	7.72
Discontinued operations	(0.29		)	(0.88		)	(1.70		)
Diluted earnings per common share	$	2.46		$	5.01		$	6.02
Stock options and share-based awards not included in diluted EPS calculation because their effect would have be antidilutive	7			11			13

(1) Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive than the calculation using the treasury stock method.

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Business Segments and Enterprise-Wide Information

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Business Segments and Enterprise-Wide Information

Note 14: Business Segments and Enterprise-Wide Information

Management, including our chief operating decision maker, who is our CEO, evaluates the performances of our business segments primarily on segment revenue and segment operating income (loss) before depreciation, amortization and other, and share-based compensation granted to executives, non-employee directors and employees (“segment operating income (loss)”). Segment operating income (loss) contains internally allocated costs of our shared service support functions, including but not limited to, corporate executive management, business development, sales, finance, legal, human resources, information technology and risk management. We also review depreciation and amortization allocated to each segment. Share-based payments expense related to share-based compensation granted to executives, non-employee directors and employees and expense related to the rights to receive cash issued in connection with our acquisition of ecoATM are not allocated to our segments and are included in the Corporate Unallocated column in the analysis and reconciliation below; however, share-based payments expense related to our content arrangements with certain movie studios has been allocated to our Redbox segment and is included within direct operating expenses. Our performance evaluation does not include segment assets.

Changes in our Organizational Structure

We regularly assess the performance of our concepts to determine whether continued funding or other alternatives are appropriate and as a result, we discontinued operating SAMPLEit in the fourth quarter of 2015. AsSAMPLEit did not represent a major component of our operations or financial results, the results of SAMPLEit did not qualify to be reported as a discontinued operation and remain in our All Other reporting category.

During the first quarter of 2015, we added ecoATM, our electronic device recycling business, as a separate reportable segment. Previously, the results of ecoATM along with those of other self-service concepts were included in our former New Ventures segment. The combined results of the other self-service concepts are now included in our All Other reporting category in the reconciliation below, as they do not meet quantitative thresholds to be reported as a separate segment. All goodwill previously allocated to the New Ventures segment has been allocated to the ecoATM segment. See Note 6: Goodwill and Other Intangible Assetsfor further information.

Results of operations for Gazelle from the acquisition date, November 10, 2015, are included in our ecoATM segment. See Note 3: Business Combinationsfor further information.

On July 23, 2013, we completed the acquisition of ecoATM. Prior to July 23, 2013 we held a non-controlling equity interest in ecoATM and reported our share of ecoATM's operating results in loss from equity method investments in our Consolidated Statements of Comprehensive Income. Subsequent to our acquisition of ecoATM on July 23, 2013, the assets acquired and liabilities assumed, as well as the results of operations, with the exception of expense for rights to receive cash which are unallocated corporate expenses, are included in our ecoATM segment.

Comparability of Segment Results

We have recast prior period results for the following:

• Discontinued operations, consisting of our Redbox operations in Canada which we shut down during the first quarter of 2015. See Note 12: Discontinued Operationsfor further information; and

• The addition of our ecoATM segment and our All Other reporting category, which we added during the first quarter of 2015.

Our analysis and reconciliation of our segment information to the consolidated financial statements that follows covers our results of operations, which consists of our Redbox, Coinstar and ecoATM segments, Corporate Unallocated expenses and our All Other reporting category. All Other includes the results of other self-service concepts, which we regularly assess to determine whether continued funding or other alternatives are appropriate.

Dollars in thousands
Year Ended December 31, 2015	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,760,899		$	318,611		$	113,558		$	143		$	—		$	2,193,211
Expenses:
Direct operating	1,213,744			159,211			113,141			4,431			2,561			1,493,088
Marketing	19,804			5,566			8,481			1,128			695			35,674
Research and development	—			—			5,545			(84		)	1,737			7,198
General and administrative	129,013			31,561			10,875			7,188			11,756			190,393
Restructuring and related costs (Note 11)	23,540			2,076			687			850			—			27,153
Goodwill impairment (Note 6)	—			—			85,890			—			—			85,890
Segment operating income (loss)	374,798			120,197			(111,061		)	(13,370		)	(16,749		)	353,815
Less: depreciation and amortization	(118,902		)	(31,871		)	(26,382		)	(7,785		)	—			(184,940		)
Operating income (loss)	255,896			88,326			(137,443		)	(21,155		)	(16,749		)	168,875
Loss from equity method investments, net	—			—			—			—			(800		)	(800		)
Interest expense, net	—			—			—			—			(42,353		)	(42,353		)
Other, net	—			—			—			—			(2,657		)	(2,657		)
Income (loss) from continuing operations before income taxes	$	255,896		$	88,326		$	(137,443	)	$	(21,155	)	$	(62,559	)	$	123,065

Dollars in thousands
Year Ended December 31, 2014	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,881,718		$	315,628		$	94,187		$	53		$	—		$	2,291,586
Expenses:
Direct operating	1,318,509			161,214			92,182			2,821			6,585			1,581,311
Marketing	20,969			6,346			3,513			1,272			3,193			35,293
Research and development	120			531			5,691			2,854			3,851			13,047
General and administrative	135,554			26,989			12,773			3,522			11,658			190,496
Restructuring and related costs (Note 11)	534			23			—			—			—			557
Segment operating income (loss)	406,032			120,525			(19,972		)	(10,416		)	(25,287		)	470,882
Less: depreciation and amortization	(149,236		)	(35,471		)	(17,031		)	(740		)	—			(202,478		)
Operating income (loss)	256,796			85,054			(37,003		)	(11,156		)	(25,287		)	268,404
Loss from equity method investments, net	—			—			—			—			(28,734		)	(28,734		)
Interest expense, net	—			—			—			—			(47,644		)	(47,644		)
Other, net	—			—			—			—			(1,185		)	(1,185		)
Income (loss) from continuing operations before income taxes	$	256,796		$	85,054		$	(37,003	)	$	(11,156	)	$	(102,850	)	$	190,841

Dollars in thousands
Year Ended December 31, 2013	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,967,715		$	300,218		$	31,824		$	28		$	—		$	2,299,785
Expenses:
Direct operating	1,365,368			158,562			27,271			2,162			3,636			1,556,999
Marketing	20,835			6,244			938			651			1,559			30,227
Research and development	76			6,962			2,772			1,897			1,375			13,082
General and administrative	160,863			25,220			7,868			7,683			14,164			215,798
Restructuring and related costs (Note 11)	3,771			724			—			—			—			4,495
Segment operating income (loss)	416,802			102,506			(7,025		)	(12,365		)	(20,734		)	479,184
Less: depreciation and amortization	(159,851		)	(33,921		)	(6,077		)	(459		)	—			(200,308		)
Operating income (loss)	256,951			68,585			(13,102		)	(12,824		)	(20,734		)	278,876
Loss from equity method investments, net	—			—			—			—			19,928			19,928
Interest expense, net	—			—			—			—			(32,807		)	(32,807		)
Other, net	—			—			—			—			(3,599		)	(3,599		)
Income (loss) from continuing operations before income taxes	$	256,951		$	68,585		$	(13,102	)	$	(12,824	)	$	(37,212	)	$	262,398

Significant Retailer Relationships

The following retailers accounted for 10% or more of our consolidated revenue:

	Year Ended December 31,
	2015		2014		2013
Wal-Mart Stores Inc.	16.6	%	15.5	%	15.2	%
Walgreen Co.	13.4	%	13.8	%	14.7	%
The Kroger Company	9.8	%	9.8	%	10.0	%

Revenue and Long-lived Assets by Geographic Location

Revenue is allocated to geographic locations based on the location of the kiosk. Revenue by geographic location was as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	2,145,887	$	2,242,753	$	2,254,790
All other	47,324		48,833		44,995
Total revenue	$	2,193,211	$	2,291,586	$	2,299,785

Long-lived assets by geographic location were as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	848,450	$	1,027,271	$	1,140,224
All other	14,133		33,426		38,406
Total long-lived assets	$	862,583	$	1,060,697	$	1,178,630

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Fair Value

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value

Note 15: Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. To measure fair value, we use a three-tier valuation hierarchy based upon observable and non-observable inputs:

• Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities;

• Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; or

• Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.

The factors or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

Assets and Liabilities Measured and Reported at Fair Value on a Recurring Basis

The following table presents our financial assets and liabilities that are measured and reported at fair value in our Consolidated Balance Sheets on a recurring basis, by level within the fair value hierarchy (in thousands):

Fair Value at December 31, 2015	Level 1		Level 2		Level 3
Money market demand accounts and investment grade fixed income securities	$	2,743	$	—	$	—
Fair Value at December 31, 2014	Level 1		Level 2		Level 3
Money market demand accounts and investment grade fixed income securities	$	916	$	—	$	—

Money Market Demand Accounts and Investment Grade Fixed Income Securities

We determine fair value for our money market demand accounts and investment grade fixed income securities based on quoted market prices. The fair value of these assets is included in cash and cash equivalents on our Consolidated Balance Sheets.

Assets and Liabilities Measured and Reported at Fair Value on a Nonrecurring Basis

We recognize or disclose the fair value of certain assets such as non-financial assets, primarily long-lived assets, goodwill, intangible assets and certain other assets in connection with impairment evaluations. All of our nonrecurring valuations use significant unobservable inputs and therefore fall under Level 3 of the fair value hierarchy.

For more information regarding the goodwill impairment charge recognized in 2015, and the related fair value, see Note 6: Goodwill and Other Intangible Assets.

Notes Receivable

On June 9, 2011, we completed the sale transaction of the Money Transfer Business to Sigue Corporation (“Sigue”). We received $19.5 million in cash and a note receivable of $29.5 million (the “Sigue Note”). In December 2011, as part of the sale transaction, we were required to provide Sigue with an additional loan of $4.0 million under terms consistent with the Sigue Note. We estimated the fair value of the Sigue Note based on the future note payments discounted at a market rate for similar risk profile companies, approximately 18.0%, which reflected our best estimate of default risk, and was not an exit price based measure of fair value or the stated value on the face of the Sigue Note. We evaluated the Sigue Note for collectability on a quarterly basis. Our evaluation at September 30, 2013 included consideration of ongoing discussions surrounding early payment on the note and certain indemnification obligations we have previously undertaken, as a result of our evaluation we did not record interest income on the note and also recorded a charge of $2.8 million against the note balance to arrive at a carrying value which approximated its estimated fair value. During the fourth quarter of 2013, we received $24.8 million in cash from Sigue for full settlement of the Sigue Note, interest and a release of certain indemnification claims. We recorded a benefit of $2.5 million from the release of indemnification related reserves.

Fair Value of Other Financial Instruments

The carrying value of our term loans approximates their fair value and falls under Level 2 of the fair value hierarchy.

We estimated the fair value of our 2019 Notes and 2021 Notes outstanding using quoted market prices by independent dealers. The estimated fair value of our 2019 Notes and 2021 Notes was approximately $312.0 million and $213.0 million at December 31, 2015, and $350.0 million and $300.0 million at December 31, 2014, respectively. The fair value estimate of our senior unsecured notes falls under Level 2 of the fair value hierarchy. We have reported the carrying value, face value less the unamortized debt discount, of our senior unsecured notes, issued at par, in our Consolidated Balance Sheets.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Note 16: Commitments and Contingencies

Lease Commitments

Operating Leases

We lease our corporate administrative, marketing, and product development facilities in Bellevue, Washington under operating leases that expire December 31, 2019.

We lease our Redbox facility in Oakbrook Terrace, Illinois under an operating lease that expires on July 31, 2021. Under certain circumstances, we have the ability to extend the lease for a five-year period, rent additional office space under a right of first offer and refusal and have the option to terminate the lease in July 2016. Under the terms of the lease, we are responsible for certain tax, construction and operating costs associated with the rented space. We early terminated our operating lease of certain floors of our Redbox headquarters and recognized the fair value of the ongoing lease payments and other related costs through the effective date of termination, July 31, 2016, as of the cease use date, March 31, 2015. See Note 11: Restructuring for additional information;

We entered into a new operating lease of 16,085 square feet of office space for Redbox in Woodland Hills, California which expires May 31, 2022.

We lease our ecoATM facility in San Diego, California. The lease for this space will expire on August 10, 2025. Additionally, with the acquisition of Gazelle in the fourth quarter of 2015, we acquired facilities in Boston, Massachusetts and Louisville, Kentucky. The leases for these spaces will expire on November 30, 2020 and February 28, 2018, respectively.

Rent expense, net of sublease income under our operating lease agreements was $18.0 million, $16.8 million and $12.3 million during 2015, 2014 and 2013, respectively.

Capital Leases

We lease automobiles and computer equipment under capital leases expiring at various dates through 2022. We assess these leases as they come due as to whether we should purchase, enter into new capital leases, or enter into operating leases.

Assets held under capital leases are included in property and equipment, net on the Consolidated Balance Sheets and include the following:

Dollars in thousands	December 31,
	2015			2014
Gross property and equipment	$	26,394		$	41,336
Accumulated depreciation	(20,735		)	(26,831		)
Net property and equipment	$	5,659		$	14,505

As of December 31, 2015, our future minimum lease payments, net of sublease income are as follows:

Dollars in thousands	Capital Leases			Operating Leases(1)
2016	$	4,144		$	18,969
2017	1,011			13,445
2018	429			10,215
2019	305			7,986
2020	209			4,936
Thereafter	123			7,132
Total minimum lease commitments	6,221			62,683
Less: sublease income	—			(1,332		)
Total minimum lease commitments, net	6,221			$	61,351
Less: amounts representing interest	(332		)
Present value of capital lease obligations	5,889
Less: Current portion of capital lease obligations	(4,006		)
Long-term portion of capital lease obligations	$	1,883

(1) Includes all operating leases having an initial or remaining non-cancelable lease term in excess of one year.

Purchase Commitments

Pursuant to the manufacturing and services agreement entered into as part of the NCR Asset Acquisition, Outerwall, Redbox or an affiliate were committed to purchase goods and services from NCR for a period of five years from June 22, 2012. At the end of the five-year period, if the aggregate amount paid in margin to NCR for goods and services delivered were to equal less than $25.0 million, Outerwall was to pay NCR the difference between such aggregate amount and $25.0 million. We made purchases in 2015, 2014 and 2013 that reduced this commitment by $0.4 million, $2.1 million and $7.1 million, respectively. During the fourth quarter of 2015, we made a one-time payment of $8.5 million in cash to satisfy all outstanding obligations related to, and to effectively settle, our remaining purchase commitment of $15.4 million established by the manufacturing and services agreement. The one-time payment was recognized as restructuring and related costs in our Consolidated Statements of Comprehensive Income.

We have entered into certain miscellaneous purchase agreements, primarily related to purchases of equipment, which resulted in total purchase commitments of $24.5 million as of December 31, 2015.

Content License Agreements

On January 21, 2016, Redbox entered into an amendment to the existing agreement with Universal Home Entertainment LLC (“Universal”), extending the agreement through December 31, 2017. See Note 21: Subsequent Eventsin our Notes to Consolidated Financial Statements for additional information.

On October 16, 2015, Paramount elected to exercise its option to extend our existing content license agreement. This extended the license period through December 31, 2016, with no further options to renew, and required us to issue 50,000 shares of additional restricted stock to Paramount during the first quarter of 2016, which we issued on January 4, 2016.

On July 14, 2015, Sony elected to exercise its option to extend our existing content license agreement. This extended the license period through September 30, 2016, with no further options to renew, and required us to issue 25,000 shares of additional restricted stock to Sony during the fourth quarter of 2015, which we issued on October 2, 2015.

On June 5, 2015, Redbox entered into an amendment to the existing April 22, 2010, agreement with Twentieth Century Fox Home Entertainment LLC (“Fox”) that maintains a 28-day window on Blu-ray Disc and DVD titles through June 30, 2017, and includes a revenue sharing arrangement between Redbox and Fox.

On March 26, 2015, we entered into a revenue sharing agreement with Warner Home Video, a division of Warner Bros. Home Entertainment Inc., (the “Warner Agreement”) under which Redbox agreed to license minimum quantities of theatrical and direct-to-video titles for rental through March 31, 2017. The Warner Agreement maintains a 28-day window on such titles.

We have entered into certain license agreements to obtain content for movie and video game rentals. A summary of the estimated movie commitments in relation to these agreements as of December 31, 2015, is presented in the following table:

Dollars in thousands	December 31,
	Total		2016		2017
Total estimated movie commitments(1)	$	448,718	$	381,275	$	67,443

(1) Subsequent to year end and not included in this table, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. See Note 21: Subsequent Events for additional information.

General terms of our content license agreements with studios are as follows as of December 31, 2015:

Studio	End Date		Release Date
Fox	6/30/2017		Delay	(1)
Sony	9/30/2016		Day & Date	(2)
Paramount	12/31/2016		Day & Date	(2)
Warner	3/31/2017		Delay	(1)
Lionsgate	9/30/2016	(3)	Day & Date	(2)
Universal	12/31/2015	(4)	Delay	(1)

(1) Content licensed under the agreement is available for rental after a certain number of days following the retail release.

(2) Content licensed under the agreement is available for rental on the same day and date as the retail release.

(3) Agreement extends the term of the arrangement automatically for an additional year under certain conditions.

(4) Subsequent to year end, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. See Note 21: Subsequent Events for additional information.

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	December 31,
	Total		2016		2017		2018
Redbox	$	2,365	$	1,711	$	523	$	131

Letters of Credit

As of December 31, 2015, we had five irrevocable standby letters of credit that totaled $6.5 million. These standby letters of credit, which expire at various times through November2016, are used to collateralize certain obligations to third parties. As of December 31, 2015, 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 alleged 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 complaint. In November 2011, the plaintiff moved for class certification, and Redbox moved for summary judgment. The court denied Redbox's motion for summary judgment in February 2012. The plaintiff filed an amended complaint on April 19, 2012, and an amended motion for class certification on June 5, 2012. The court denied Redbox's motion to dismiss the amended complaint. The amended class certification motion was briefed and argued. At the hearing on plaintiff's amended motion for class certification, the plaintiff dismissed all claims but two and is pursuing only her claims under the Illinois Rental Purchase Agreement Act and the Illinois Automatic Contract Renewal Act. On May 21, 2013, the court denied plaintiff's amended class action motion. On January 29, 2014, the Illinois Supreme Court denied plaintiff’s petition for leave to appeal the trial court’s denial of class certification. Redbox has moved to dismiss all remaining claims on mootness grounds, and the Court granted Redbox’s motion on December 11, 2014. The plaintiffs appealed on January 7, 2015. Oral argument was held November 10, 2015. The Appellate Court affirmed the trial court’s rulings on January 11, 2016. We continue to believe that the claims against us are without merit and intend to defend ourselves vigorously in this matter should plaintiff seek further appellate review. 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.

Other Contingencies

During the year ended December 31, 2013, we resolved a previously disclosed loss contingency related to a supply agreement and recorded a benefit of $11.4 million in the direct operating line item in our Consolidated Statements of Comprehensive Income.

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Guarantor Subsidiaries

12 Months Ended

Dec. 31, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Guarantor Subsidiaries

Note 17: Guarantor Subsidiaries

Certain of our wholly-owned subsidiaries have, jointly and severally, fully and unconditionally guaranteed the 2019 Notes and 2021 Notes. Pursuant to SEC regulations, we have presented in columnar format the condensed consolidating financial information for Outerwall Inc., the guarantor subsidiaries on a combined basis, and all non-guarantor subsidiaries on a combined basis in the following tables:

CONSOLIDATING BALANCE SHEETS
	As of December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries		Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	160,167		$	19,372	$	43,010	$	—		$	222,549
Accounts receivable, net of allowances	3,983			33,269		1,212		—			38,464
Content library	—			188,490		—		—			188,490
Prepaid expenses and other current assets	17,720			33,049		599		—			51,368
Intercompany receivables	35,654			527,996		426		(564,076		)	—
Total current assets	217,524			802,176		45,247		(564,076		)	500,871
Property and equipment, net	97,659			204,081		14,273		—			316,013
Deferred income taxes	—			—		2,606		—			2,606
Goodwill and other intangible assets, net	249,703			290,811		—		—			540,514
Other long-term assets	4,596			1,293		167		—			6,056
Investment in related parties	921,456			27,798		—		(949,254		)	—
Total assets	$	1,490,938		$	1,326,159	$	62,293	$	(1,513,330	)	$	1,366,060
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	16,127		$	167,694	$	189	$	—		$	184,010
Accrued payable to retailers	71,947			30,157		12,994		—			115,098
Other accrued liabilities	57,025			82,401		2,011		—			141,437
Current portion of long-term debt and other long-term liabilities	16,832			—		299		—			17,131
Intercompany payables	459,789			85,487		18,800		(564,076		)	—
Total current liabilities	621,720			365,739		34,293		(564,076		)	457,676
Long-term debt and other long-term liabilities	877,325			19,882		159		—			897,366
Deferred income taxes	13,965			19,083		44		—			33,092
Total liabilities	1,513,010			404,704		34,496		(564,076		)	1,388,134
Commitments and contingencies
Stockholders’ Equity:
Preferred stock	—			—		—		—			—
Common stock	599,675			252,727		4,636		(371,875		)	485,163
Treasury stock	(1,151,063		)	—		3,000		(3,000		)	(1,151,063		)
Retained earnings	530,140			668,728		18,963		(574,379		)	643,452
Accumulated other comprehensive income (loss)	(824		)	—		1,198		—			374
Total stockholders’ equity (deficit)	(22,072		)	921,455		27,797		(949,254		)	(22,074		)
Total liabilities and stockholders’ equity	$	1,490,938		$	1,326,159	$	62,293	$	(1,513,330	)	$	1,366,060

CONSOLIDATING BALANCE SHEETS
	As of December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	180,889		$	17,939		$	43,868		$	—		$	242,696
Accounts receivable, net of allowances	3,203			43,874			1,513			—			48,590
Content library	—			176,490			3,631			—			180,121
Prepaid expenses and other current assets	14,884			23,923			1,012			—			39,819
Intercompany receivables	40,762			467,181			—			(507,943		)	—
Total current assets	239,738			729,407			50,024			(507,943		)	511,226
Property and equipment, net	133,923			263,412			31,133			—			428,468
Deferred income taxes	—			—			11,363			—			11,363
Goodwill and other intangible assets, net	249,717			374,281			—			—			623,998
Other long-term assets	6,665			1,231			335			—			8,231
Investment in related parties	917,234			(5,114		)	—			(912,120		)	—
Total assets	$	1,547,277		$	1,363,217		$	92,855		$	(1,420,063	)	$	1,583,286
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	12,899		$	153,260		$	2,474		$	—		$	168,633
Accrued payable to retailers	69,189			42,977			14,124			—			126,290
Other accrued liabilities	59,770			74,536			2,820			—			137,126
Current portion of long-term debt and other long-term liabilities	20,020			—			396			—			20,416
Intercompany payables	309,932			121,015			76,996			(507,943		)	—
Total current liabilities	471,810			391,788			96,810			(507,943		)	452,465
Long-term debt and other long-term liabilities	949,588			22,946			1,135			—			973,669
Deferred income taxes	28,500			31,249			25			—			59,774
Total liabilities	1,449,898			445,983			97,970			(507,943		)	1,485,908
Commitments and contingencies
Stockholders’ Equity:
Common stock	588,105			225,729			12,393			(352,635		)	473,592
Treasury stock	(996,293		)	—			—			—			(996,293		)
Retained earnings	506,360			691,505			(17,991		)	(559,485		)	620,389
Accumulated other comprehensive income (loss)	(793		)	—			483			—			(310		)
Total stockholders’ equity	97,379			917,234			(5,115		)	(912,120		)	97,378
Total liabilities and stockholders’ equity	$	1,547,277		$	1,363,217		$	92,855		$	(1,420,063	)	$	1,583,286

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	271,430		$	1,874,457		$	47,324		$	—		$	2,193,211
Expenses:
Direct operating	143,429			1,328,269			21,390			—			1,493,088
Marketing	6,485			28,916			273			—			35,674
Research and development	(83		)	7,281			—			—			7,198
General and administrative	47,699			142,012			682			—			190,393
Restructuring and related costs	2,926			24,227			—			—			27,153
Depreciation and other	32,643			134,522			4,225			—			171,390
Amortization of intangible assets	14			13,536			—			—			13,550
Goodwill impairment	—			85,890			—			—			85,890
Total expenses	233,113			1,764,653			26,570			—			2,024,336
Operating income	38,317			109,804			20,754			—			168,875
Other income (expense), net:
Loss from equity method investments, net	(800		)	—			—			—			(800		)
Interest income (expense)	30,177			(72,164		)	(366		)	—			(42,353		)
Other, net	15,273			1,354			(19,284		)	—			(2,657		)
Total other income (expense), net	44,650			(70,810		)	(19,650		)	—			(45,810		)
Income from continuing operations before income taxes	82,967			38,994			1,104			—			123,065
Income tax expense	(31,603		)	(41,785		)	(231		)	—			(73,619		)
Income (loss) from continuing operations	51,364			(2,791		)	873			—			49,446
Income (loss) from discontinued operations, net of tax	640			(28,068		)	22,319			—			(5,109		)
Equity in income (loss) of subsidiaries	(7,667		)	23,192			—			(15,525		)	—
Net income (loss)	44,337			(7,667		)	23,192			(15,525		)	44,337
Foreign currency translation adjustment(1)	(31		)	—			715			—			684
Comprehensive income (loss)	$	44,306		$	(7,667	)	$	23,907		$	(15,525	)	$	45,021

(1) Foreign currency translation adjustment had no tax effect in 2015.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	266,848		$	1,975,905		$	48,833		$	—		$	2,291,586
Expenses:
Direct operating	142,472			1,415,132			23,707			—			1,581,311
Marketing	7,227			27,631			435			—			35,293
Research and development	3,456			9,591			—			—			13,047
General and administrative	39,412			150,211			873			—			190,496
Restructuring and related costs	23			534			—			—			557
Depreciation and other	35,155			148,217			4,452			—			187,824
Amortization of intangible assets	1,433			13,221			—			—			14,654
Total expenses	229,178			1,764,537			29,467			—			2,023,182
Operating income	37,670			211,368			19,366			—			268,404
Other income (expense), net:
Loss from equity method investments, net	(530		)	(28,204		)	—			—			(28,734		)
Interest income (expense), net	(48,007		)	572			(209		)	—			(47,644		)
Other, net	14,077			1,334			(16,596		)	—			(1,185		)
Total other income (expense), net	(34,460		)	(26,298		)	(16,805		)	—			(77,563		)
Income from continuing operations before income taxes	3,210			185,070			2,561			—			190,841
Income tax expense	(618		)	(64,989		)	(557		)	—			(66,164		)
Income from continuing operations	2,592			120,081			2,004			—			124,677
Loss from discontinued operations, net of tax	(803		)	(874		)	(16,382		)	—			(18,059		)
Equity in income (loss) of subsidiaries	104,829			(14,378		)	—			(90,451		)	—
Net income (loss)	106,618			104,829			(14,378		)	(90,451		)	106,618
Foreign currency translation adjustment(1)	368			—			89			—			457
Comprehensive income (loss)	$	106,986		$	104,829		$	(14,289	)	$	(90,451	)	$	107,075

(1) Foreign currency translation adjustment had no tax effect in 2014.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	255,251		$	1,999,539		$	44,995		$	—		$	2,299,785
Expenses:
Direct operating	138,859			1,394,932			36,155			(12,947		)	1,556,999
Marketing	6,540			23,269			418			—			30,227
Research and development	8,973			4,111			(2		)	—			13,082
General and administrative	33,023			169,099			721			12,955			215,798
Restructuring and related costs	724			3,771			—			—			4,495
Depreciation and other	28,101			157,292			4,008			—			189,401
Amortization of intangible assets	2,245			8,662			—			—			10,907
Total expenses	218,465			1,761,136			41,300			8			2,020,909
Operating income (loss)	36,786			238,403			3,695			(8		)	278,876
Other income (expense), net:
Income (loss) from equity method investments, net	65,063			(45,135		)	—			—			19,928
Interest income (expense), net	(32,930		)	257			(134		)	—			(32,807		)
Other, net	(3,868		)	479			(218		)	8			(3,599		)
Total other income (expense), net	28,265			(44,399		)	(352		)	8			(16,478		)
Income from continuing operations before income taxes	65,051			194,004			3,343			—			262,398
Income tax benefit (expense)	30,893			(70,577		)	(26		)	—			(39,710		)
Income from continuing operations	95,944			123,427			3,317			—			222,688
Loss from discontinued operations, net of tax	(30,834		)	(2,708		)	(14,354		)	—			(47,896		)
Equity in income (loss) of subsidiaries	109,682			(11,037		)	—			(98,645		)	—
Net income (loss)	174,792			109,682			(11,037		)	(98,645		)	174,792
Foreign currency translation adjustment(1)	(105		)	—			961			—			856
Comprehensive income (loss)	$	174,687		$	109,682		$	(10,076	)	$	(98,645	)	$	175,648

(1) Foreign currency translation adjustment had no tax effect in 2013.

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	44,337		$	(7,667	)	$	23,192		$	(15,525	)	$	44,337
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	32,643			136,367			8,237			—			177,247
Amortization of intangible assets	14			13,536			44			—			13,594
Share-based payments expense	10,323			6,917			—			—			17,240
Windfall excess tax benefits related to share-based payments	(739		)	—			—			—			(739		)
Deferred income taxes	(14,533		)	(12,730		)	7,644			—			(19,619		)
Restructuring, impairment and related costs	509			1,545			—			—			2,054
Loss from equity method investments, net	800			—			—			—			800
Amortization of deferred financing fees and debt discount	2,761			—			—			—			2,761
Gain from early extinguishment of debt	(5,854		)	—			—			—			(5,854		)
Gain on purchase of Gazelle	—			(989		)	—			—			(989		)
Goodwill impairment	—			85,890			—			—			85,890
Other	(539		)	295			(728		)	—			(972		)
Equity in loss (income) of subsidiaries	7,667			(23,192		)	—			15,525			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(781		)	10,673			119			—			10,011
Content library	—			(11,951		)	3,631			—			(8,320		)
Prepaid expenses and other current assets	(2,826		)	(7,599		)	360			—			(10,065		)
Other assets	66			(62		)	158			—			162
Accounts payable	(1,316		)	21,447			(2,188		)	—			17,943
Accrued payable to retailers	2,758			(12,820		)	94			—			(9,968		)
Other accrued liabilities	(391		)	11,337			(374		)	—			10,572
Net cash flows from operating activities(1)	74,899			210,997			40,189			—			326,085
Investing Activities:
Purchases of property and equipment	(26,861		)	(49,071		)	(1,659		)	—			(77,591		)
Proceeds from sale of property and equipment	17			3,208			—			—			3,225
Acquisitions, net of cash acquired	—			(17,980		)	—			—			(17,980		)
Investments in and advances to affiliates	187,538			(145,721		)	(41,817		)	—			—
Net cash flows from (used in) investing activities(1)	160,694			(209,564		)	(43,476		)	—			(92,346		)
Financing Activities:
Proceeds from new borrowing of Credit Facility	310,500			—			—			—			310,500
Principal payments on Credit Facility	(339,375		)	—			—			—			(339,375		)
Repurchases of common stock	(159,800		)	—			—			—			(159,800		)
Repurchase of Notes	(34,589		)	—			—			—			(34,589		)
Dividends paid	(21,210		)	—			—			—			(21,210		)
Principal payments on capital lease obligations and other debt	(11,110		)	—			(400		)	—			(11,510		)
Financing costs associated with Credit Facility and senior unsecured notes	(9		)	—			—			—			(9		)
Windfall excess tax benefits related to share-based payments	739			—			—			—			739
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(1,461		)	—			—			—			(1,461		)
Net cash flows used in financing activities(1)	(256,315		)	—			(400		)	—			(256,715		)

	Year Ended December 31, 2015
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	—			—		2,829			—		2,829
Increase (decrease) in cash and cash equivalents	(20,722		)	1,433		(858		)	—		(20,147		)
Cash and cash equivalents:
Beginning of period	180,889			17,939		43,868			—		242,696
End of period	$	160,167		$	19,372	$	43,010		$	—	$	222,549

(1) During 2015 we discontinued our Redbox operations in Canada. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operationsfor cash flow disclosures related to our discontinued Redbox operations in Canada.

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	106,618		$	104,829		$	(14,378	)	$	(90,451	)	$	106,618
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	35,139			150,904			9,119			—			195,162
Amortization of intangible assets	1,433			13,259			—			—			14,692
Share-based payments expense	9,693			3,691			—			—			13,384
Windfall excess tax benefits related to share-based payments	(1,964		)	—			—			—			(1,964		)
Deferred income taxes	304			(17,232		)	(5,683		)	—			(22,611		)
Loss from equity method investments, net	530			28,204			—			—			28,734
Amortization of deferred financing fees and debt discount	4,116			—			—			—			4,116
Loss from early extinguishment of debt	2,018			—			—			—			2,018
Other	(1,250		)	(548		)	48			—			(1,750		)
Equity in loss (income) of subsidiaries	(104,829		)	14,378			—			90,451			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(1,130		)	8,787			1,014			—			8,671
Content library	36			20,206			(495		)	—			19,747
Prepaid expenses and other current assets	40,826			3,753			(297		)	—			44,282
Other assets	75			1,558			69			—			1,702
Accounts payable	(3,017		)	(65,737		)	(158		)	—			(68,912		)
Accrued payable to retailers	(1,896		)	(5,149		)	198			—			(6,847		)
Other accrued liabilities	(840		)	1,988			161			—			1,309
Net cash flows from (used in) operating activities(1)	85,862			262,891			(10,402		)	—			338,351
Investing Activities:
Purchases of property and equipment	(33,602		)	(57,909		)	(6,413		)	—			(97,924		)
Proceeds from sale of property and equipment	750			1,227			—			—			1,977
Cash paid for equity investments	—			(24,500		)	—			—			(24,500		)
Extinguishment payment received from equity investment	—			5,000			—			—			5,000
Investments in and advances to affiliates	166,145			(178,406		)	12,261			—			—
Net cash flows from (used in) investing activities(1)	133,293			(254,588		)	5,848			—			(115,447		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	295,500			—			—			—			295,500
Proceeds from new borrowing of Credit Facility	642,000			—			—			—			642,000
Principal payments on Credit Facility	(680,125		)	—			—			—			(680,125		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,911		)	—			—			—			(2,911		)
Settlement and conversion of convertible debt	(51,149		)	—			—			—			(51,149		)
Repurchases of common stock	(545,091		)	—			—			—			(545,091		)
Principal payments on capital lease obligations and other debt	(13,552		)	(3		)	(441		)	—			(13,996		)
Windfall excess tax benefits related to share-based payments	1,964			—			—			—			1,964
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(520		)	—			—			—			(520		)
Net cash flows from (used in) financing activities(1)	(353,884		)	(3		)	(441		)	—			(354,328		)

	Year Ended December 31, 2014
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	368			—		2,315			—		2,683
Increase (decrease) in cash and cash equivalents	(134,361		)	8,300		(2,680		)	—		(128,741		)
Cash and cash equivalents:
Beginning of period	315,250			9,639		46,548			—		371,437
End of period	$	180,889		$	17,939	$	43,868		$	—	$	242,696

(1) During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	174,792		$	109,682		$	(11,037	)	$	(98,645	)	$	174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	29,640			158,801			5,259			—			193,700
Amortization of intangible assets	2,245			8,688			—			—			10,933
Share-based payments expense	9,903			6,928			—			—			16,831
Windfall excess tax benefits related to share-based payments	(3,698		)	—			—			—			(3,698		)
Deferred income taxes	9,228			(15,727		)	(4,434		)	—			(10,933		)
Restructuring, impairment and related costs	32,444			288			—			—			32,732
Loss (income) from equity method investments, net	(65,063		)	45,135			—			—			(19,928		)
Amortization of deferred financing fees and debt discount	6,394			—			—			—			6,394
Loss from early extinguishment of debt	6,013			—			—			—			6,013
Other	827			(2,951		)	31			54			(2,039		)
Equity in (income) losses of subsidiaries	(109,682		)	11,037			—			98,645			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(1,144		)	10,639			(1,517		)	—			7,978
Content library	1,093			(23,357		)	(195		)	—			(22,459		)
Prepaid expenses and other current assets	(43,762		)	(6,280		)	(500		)	—			(50,542		)
Other assets	201			400			(371		)	—			230
Accounts payable	1,319			(408		)	226			354			1,491
Accrued payable to retailers	(6,181		)	1,633			460			—			(4,088		)
Other accrued liabilities	13,184			(22,751		)	(6		)	—			(9,573		)
Net cash flows from (used in) operating activities(1)	57,753			281,757			(12,084		)	408			327,834
Investing Activities:
Purchases of property and equipment	(58,763		)	(88,431		)	(14,218		)	—			(161,412		)
Proceeds from sale of property and equipment	12,147			1,189			8			—			13,344
Acquisition of ecoATM, net of cash acquired	(244,036		)	—			—			—			(244,036		)
Receipt of note receivable principal	22,913			—			—			—			22,913
Cash paid for equity investments	—			(28,000		)	—			—			(28,000		)
Investments in and advances to affiliates	125,856			(156,659		)	30,857			(54		)	—
Net cash flows from (used in) investing activities(1)	(141,883		)	(271,901		)	16,647			(54		)	(397,191		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	343,769			—			—			—			343,769
Proceeds from new borrowing of Credit Facility	400,000			—			—			—			400,000
Principal payments on Credit Facility	(215,313		)	—			—			—			(215,313		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,203		)	—			—			—			(2,203		)
Conversion of convertible debt	(172,211		)	—			—			—			(172,211		)
Repurchases of common stock	(195,004		)	—			—			—			(195,004		)
Principal payments on capital lease obligations and other debt	(14,200		)	(217		)	(417		)	—			(14,834		)
Windfall excess tax benefits related to share-based payments	3,698			—			—			—			3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	8,460			—			—			—			8,460
Net cash flows from (used in) financing activities(1)	156,996			(217		)	(417		)	—			156,362

	Year Ended December 31, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries		Eliminations and Consolidation Reclassifications			Total
Effect of exchange rate changes on cash	(105		)	—		1,643		—			1,538
Increase (decrease) in cash and cash equivalents	72,761			9,639		5,789		354			88,543
Cash and cash equivalents:
Beginning of period	242,489			—		40,759		(354		)	282,894
End of period	$	315,250		$	9,639	$	46,548	$	—		$	371,437

(1) During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

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Income Taxes From Continuing Operations

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Abstract]

Income Taxes From Continuing Operations

Note 18: Income Taxes From Continuing Operations

Components of Income Taxes

The components of income from continuing operations before income taxes were as follows:

	Year Ended December 31,
Dollars in thousands	2015		2014		2013
U.S. operations	$	121,940	$	188,473	$	259,057
Foreign operations	1,125		2,368		3,341
Total income from continuing operations before income taxes	$	123,065	$	190,841	$	262,398

Components of Income Tax Expense

The components of income tax expense from continuing operations were as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Current:
U.S. Federal	$	89,996		$	69,117		$	38,876
State and local	10,658			12,294			10,104
Foreign	469			415			(424		)
Total current	101,123			81,826			48,556
Deferred:
U.S. Federal	(27,641		)	(16,232		)	(3,642		)
State and local	380			427			(5,653		)
Foreign	(243		)	143			449
Total deferred	(27,504		)	(15,662		)	(8,846		)
Total income tax expense	$	73,619		$	66,164		$	39,710

Rate Reconciliation

The income tax expense differs from the amount that would result by applying the U.S. statutory rate to income before income taxes as follows:

	Year Ended December 31,
	2015		2014		2013
U.S Federal tax expense at statutory rates	35.0	%	35.0	%	35.0	%
State income taxes, net of federal benefit	5.8		4.1		3.9
Federal and state credits	(1.6	)	(1.1	)	(0.9	)
Domestic production activities deduction	(4.9	)	(3.6	)	(0.6	)
Goodwill Impairment	24.4		—		—
Recognition of outside basis differences	—		(1.1	)	(15.4	)
ecoATM option payments	0.2		1.4		0.7
Valuation allowance	0.2		—		2.3
Acquisition of ecoATM	—		—		(9.3	)
Other	0.7		—		(0.6	)
Effective tax rate	59.8	%	34.7	%	15.1	%

Our effective tax rate for the year ended December 31, 2015, was higher than the U.S. Federal statutory rate of 35.0%primarily due to an $85.9 million non-tax deductible goodwill impairment charge recorded in the second quarter of 2015 and state income taxes, partially offset by the domestic production activities deduction and federal and state tax credits.

On December 18, 2015, the President signed into law the Protecting Americans from Tax Hikes Act of 2015, which retroactively extended a number of tax deductions and credits that otherwise would have expired, including the research and development credit and bonus depreciation. We reported the 2015 impact of the Act in the fourth quarter. 

Our effective tax rate for the year ended December 31, 2014 was lower than the U.S. Federal statutory rate of 35.0% due primarily to the domestic production activities deduction and federal and state tax credits, partially offset by state income taxes.

Our effective tax rate for the year ended December 31, 2013 was lower than the U.S. Federal statutory rate of 35.0% due primarily to the following items:

• During the fourth quarter of 2013, we reported a $16.7 million tax benefit related to the recognition of a worthless stock deduction from an outside basis difference in a corporate subsidiary.

• During the third quarter of 2013, we reported a $24.3 million tax benefit related to the non-taxable gain upon the re-measurement of our previously held equity interest in ecoATM.

• During the second quarter of 2013, we entered into an arrangement to sell certain NCR kiosks and a series of transactions to reorganize Redbox related subsidiary structures through the sale of a wholly owned subsidiary. As a result of the series of transactions we recorded a discrete one-time tax benefit of $17.8 million, net of a valuation allowance, through the realization of capital and ordinary gains and losses.

The combined impact of these three items was a 22.4 percentage point reduction in the effective tax rate for the year ended December 31, 2013. In addition, our 2013 effective tax rate was increased by state income taxes, offset partially by the domestic production activities deduction.

We did not provide for U.S. income taxes on certain undistributed earnings of foreign operations that were considered permanently invested outside of the United States. Upon repatriation, some of these earnings would generate foreign tax credits, which may reduce the U.S. tax liability associated with any future foreign dividend. At December 31, 2015, the cumulative amount of earnings upon which U.S. income taxes have not been provided was approximately $18.8 million.

Unrecognized Tax Benefits

The aggregate changes in the balance of unrecognized tax benefits were as follows:

Dollars in thousands	Year Ended December 31,
	2015			2014			2013
Balance, beginning of the year	$	4,639		$	2,781		$	2,383
Additions based on tax positions related to the current year	1,837			1,836			824
Additions for tax positions related to prior years	527			806			18
Reductions for tax positions related to prior years	(118		)	—			(257		)
Reductions from lapse of applicable statute of limitations	—			(784		)	(49		)
Settlements	—			—			(138		)
Balance, end of year	$	6,885		$	4,639		$	2,781

We recognize interest and penalties, if any, related to income tax matters in Income tax expense. We accrued interest of $0.3 million and $0.1 million as of December 31, 2015 and December 31, 2014, respectively. It was not necessary to accrue interest in 2013 or accrue for penalties in any period presented.

Tax Years Open for Examination

As of December 31, 2015, for our major tax jurisdictions, the years 2012 through 2014 were open for examination by U.S. Federal and most state tax authorities. Additionally, the years 1998 through 2011 are subject to examination, to the extent that net operating loss and income tax credit carryforwards from those years were utilized in 2010 and later years.

Deferred Income Taxes

Deferred income tax assets and liabilities reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the carrying amounts used for income tax purposes. Future tax benefits for net operating loss and tax credit carryforwards are also recognized to the extent that realization of such benefits is more likely than not.

In determining our tax provisions, management determined the deferred tax assets and liabilities for each separate tax jurisdiction and considered a number of factors including the positive and negative evidence regarding the realization of our deferred tax assets to determine whether a valuation allowance should be recognized with respect to our deferred tax assets.

Significant components of our deferred tax assets and liabilities and the net increase (decrease) in the valuation allowance were as follows:

Dollars in thousands	December 31,
	2015			2014
Deferred tax assets:
Income tax loss carryforwards	$	3,015		$	5,690
Capital loss carryforwards	4,759			5,930
Credit carryforwards	3,482			2,929
Accrued liabilities and allowances	27,188			22,652
Stock-based compensation	9,065			11,901
Intangible assets	13,109			17,166
Other	5,720			3,776
Gross deferred tax assets	66,338			70,044
Less: Valuation Allowance	(7,141		)	(6,898		)
Total deferred tax assets	59,197			63,146
Deferred tax liabilities:
Property and equipment	(42,984		)	(68,417		)
Product costs	(46,699		)	(43,140		)
Total deferred tax liabilities	(89,683		)	(111,557		)
Net deferred tax liabilities	$	(30,486	)	$	(48,411	)

Change in Valuation Allowance

Dollars in thousands	Year Ended December 31,
	2015		2014		2013
Increase in valuation allowance	$	243	$	—	$	6,898

The increase in our valuation allowance is due to changes in the expected future and actual utilization of capital losses and state tax credit carryforwards.

Deferred Tax Assets Relating to Income Tax Loss Carryforwards

Our deferred tax assets relating to income tax loss carryforwards and expiration periods are summarized as follows: 

Dollars in thousands	December 31, 2015
	Federal		State		Foreign
Net operating loss carryforwards	$	23	$	24,570	$	7,082
Deferred tax assets related to net operating loss carryforwards	$	8	$	1,118	$	1,889
Years that net operating loss carryforwards will expire between	2029-2034		2017-2033		2033-2035

U.S. State Tax Credits and Expiration Periods

The following table shows our U.S. state tax credits before valuation allowances and related expiration periods.

Dollars in thousands	December 31, 2015
	Amount		Expiration
U.S state tax credits:
Illinois state tax credits	$	2,894	2017-2021
California U.S. state tax credits	588		Do not expire
Total U.S. state tax credits	$	3,482

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Retirement Plans

12 Months Ended

Dec. 31, 2015

Compensation and Retirement Disclosure [Abstract]

Retirement Plans

Note 19: Retirement Plans

We sponsor a defined contribution plan for our employees who satisfy certain age and service requirements. Our contributions to these plans were $4.3 million, $4.3 million and $4.9 million in 2015, 2014 and 2013, respectively.

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Dividends

12 Months Ended

Dec. 31, 2015

Dividends [Abstract]

Dividends

Note 20: Dividends

On February 3, 2015, our Board of Directors decided to initiate a quarterly cash dividend. The first cash dividend of $0.30 per outstanding share of our common stock was paid on March 18, 2015, to all stockholders of record on March 3, 2015. Additional cash dividends of $0.30 per outstanding share of our common stock were paid on June 23, 2015, September 15, 2015, and December 8, 2015. Total dividends paid in 2015 were $21.3 million, including $0.6 million paid to recipients of unvested restricted stock awards. See Note 13: Earnings Per Share for additional information.

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Subsequent Events

12 Months Ended

Dec. 31, 2015

Subsequent Events [Abstract]

Subsequent Events

Note 21: Subsequent Events

Studio Agreement

On January 21, 2016, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. After accounting for this amendment, our total estimated movie commitments to purchase content was approximately $640.5 million.

Dividend

On February 3, 2016, the Board declared a quarterly cash dividend of $0.30 per share expected to be paid on March 29, 2016, to all stockholders of record as of the close of business on March 15, 2016.

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Principles of Consolidation, Policy

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Outerwall Inc. and our wholly-owned subsidiaries. Investments in companies of which we may have significant influence, but not a controlling interest, are accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates in Financial Reporting, Policy

Use of Estimates in Financial Reporting

We prepare our financial statements in conformity with accounting principles generally accepted in the U.S. which requires management to make estimates and assumptions that affect the reported amounts in our consolidated financial statements and our notes thereto. The most significant estimates and assumptions include the:

• useful lives and salvage values of our content library;

• determination of goodwill impairment;

• lives and recoverability of equipment and other long-lived assets;

• recognition and measurement of current and long-term deferred income taxes (including the measurement of uncertain tax positions);

• recognition and measurement of purchase price allocation for business combinations; and

• loss contingencies.

It is reasonably possible that the estimates we make may change in the future and could have a material effect on our financial statements.

Cash and Cash Equivalents, Policy

Cash and Cash Equivalents

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. Our cash and cash equivalents were $222.5 million and $242.7 million at December 31, 2015, and December 31, 2014, respectively. Of this total, cash equivalents were $2.7 million and $0.9 million, respectively, and consisted of money market demand accounts and investment grade fixed income securities such as money market funds, certificate of deposits, and commercial paper. Our cash balances with financial institutions may exceed the deposit insurance limits.

Accounts Receivable, Policy

Accounts Receivable

Accounts receivable represents receivables, net of allowances for doubtful accounts. The allowance for doubtful accounts reflects our best estimate of probable losses inherent in the accounts receivable balance. We determine the allowance based on historical experience and other currently available information. When a specific account is deemed uncollectible, the account is written off against the allowance. Amounts expensed for uncollectible accounts and amounts charged against the allowance were immaterial in all periods presented.

Content Library, Policy

Content Library

Content library consists of movies and video games available for rent or purchase. We obtain our movie and video game content primarily through revenue sharing agreements and license agreements with studios and game publishers, as well as through distributors and other suppliers. The cost of content mainly includes the cost of the movies and video games, labor, overhead, freight, and studio revenue sharing expenses. The content purchases are capitalized and amortized to their estimated salvage value as a component of direct operating expenses over the usage period. For purchased content that we expect to sell at the end of its useful life, we determine an estimated salvage value. Content salvage values are estimated based on the amounts that we have historically recovered on disposal. For licensed content that we do not expect to sell, no salvage value is provided. The useful lives and salvage value of our content library are periodically reviewed and evaluated. Amortization charges are derived utilizing rental curves based on historical performance of movies and games over their useful lives and recorded on an accelerated basis, reflecting higher rentals of movies and video games in the first few weeks after release, and substantially all of the amortization expense is recognized within one year of purchase.

In the second quarter of 2013, we completed a review of our content library amortization methodology and updated the methodology in order to add greater precision to product cost amortization. The previous method recognized accelerated amortization of content library costs at a rate faster than the decline in the content library's value due to the recognition of charges in addition to the normal rental curve amortization whenever individual discs were removed from kiosks, a process we define as "thinning". The Company's most recent analysis has shown that its amortization curves can reasonably capture the effect of thinning and therefore eliminates the need for additional charges at the time of thinning and provides a better correlation of costs to revenue. The modified approach to amortizing the cost of the content library is based on updated rental curves, which incorporate thinning estimates, and provides a more systematic method for recognizing the costs of movie and game titles that better aligns the recognition of costs with the related revenue.

The Company believes that the change in its content library amortization methodology, made on a prospective basis, is a change in accounting estimate that is affected by a change in accounting principle. The Company believes that the modified content library amortization methodology is preferable because it better reflects the pattern of consumption of the expected benefits of the content library. A copy of our auditor's preferability letter is filed as an exhibit to our 10-Q for the period ended June 30, 2013.

The effect of this change resulted in a reduction of product costs, as reported in direct operating expenses, of approximately $21.7 million in the second quarter of 2013, with those costs shifted to primarily the third and fourth quarters and some into 2014. The change resulted in a corresponding increase to the balance of our content library. In addition, the change in amortization methodology shifted product costs on titles purchased during the second half of 2013 into 2014 as amortization is less accelerated than under the prior method. Under the modified amortization methodology we continue to recognize substantially all of the amortization expense within one year of purchase. For year ended December 31, 2013, the change resulted in a total pretax benefit of $31.8 million or $1.17 per basic share and $1.12 per diluted share.

Property and Equipment, Policy

Property and Equipment

Property and equipment are stated at cost, net of accumulated depreciation. Expenditures that extend the life, increase the capacity, or improve the efficiency of property and equipment are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation is recognized using the straight-line method over the following approximate useful lives:

	Useful Life
Coin-counting kiosks and components	2 - 10 years
Redbox kiosks and components	3 - 5 years
ecoATM kiosk and components	5 years
Computers and software	3 - 5 years
Office furniture and equipment	5 - 7 years
Leased vehicles	3 - 6 years
Leasehold improvements (shorter of life of asset or remaining lease term)	1 - 11 years

Internal-Use Software, Policy

Internal-Use Software

We capitalize costs incurred to develop or obtain internal-use software during the application development stage. Capitalization of software development costs occurs after the preliminary project stage is complete, management authorizes the project, and it is probable that the project will be completed and the software will be used for the function intended. We expense costs incurred for training, data conversion, and maintenance, as well as spending in the post-implementation stage. A subsequent addition, modification or upgrade to internal-use software is capitalized only to the extent that it enables the software to perform a task it previously could not perform. The internal-use software is included in computers and software under property and equipment in our Consolidated Balance Sheets. We amortize the internal-use software based on the estimated useful life on a straight-line basis.

Intangible Assets Subject to Amortization, Policy

Intangible Assets Subject to Amortization

Our intangible assets subject to amortization are primarily composed of developed technology and retailer relationships acquired in connection with our acquisitions. We used expectations of future cash flows, with appropriate discount rates based on the stage of the enterprise acquired, to estimate the fair value of our intangible assets. We amortize our intangible assets on a straight-line basis over their expected useful lives.

Goodwill, Policy

Goodwill

Goodwill represents the excess purchase price of an acquired enterprise or assets over the estimated fair value of identifiable net assets acquired. We assess goodwill for potential impairment at the reporting unit level on an annual basis as of November 30, or whenever an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. We may assess qualitative factors to make this determination, or bypass such a qualitative assessment and proceed directly to testing goodwill for impairment using a two-step process. Qualitative factors we may consider include, but are not limited to, macroeconomic conditions, industry conditions, the competitive environment, changes in the market for our products and services, regulatory and political developments and entity specific factors such as strategies and financial performance. If, after completing such assessment, it is determined more likely than not that the fair value of a reporting unit is less than its carrying value, we proceed to a two-step impairment test, whereby the first step is comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired and the second step of the test is not performed. The second step of the impairment test is performed when the carrying amount of the reporting unit exceeds the fair value, then the implied fair value of the reporting unit goodwill is compared with the carrying amount of that goodwill. If the carrying amount of the reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss shall be recognized in an amount equal to the excess. For additional information see Note 6: Goodwill and Other Intangible Assets.

Lives and Recoverability of Equipment and Other Long-Lived Assets, Policy

Lives and Recoverability of Equipment and Other Long-Lived Assets

We evaluate the estimated remaining life and recoverability of equipment and other assets, including intangible assets subject to amortization, whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. Factors that would indicate potential impairment include, but are not limited to, significant decreases in the market value of the long-lived asset(s), a significant change in the long-lived asset’s use or physical condition, and operating or cash flow losses associated with the use of the long-lived asset. When there is an indication of impairment, we prepare an estimate of future undiscounted cash flows expected to result from the use of the asset and its eventual disposition to test recoverability. If the sum of the future undiscounted cash flow is less than the carrying value of the asset, it indicates that the long-lived asset is not recoverable, in which case we will then compare the estimated fair value to its carrying value. If the estimated fair value is less than the carrying value of the asset, we recognize the impairment loss and adjust the carrying amount of the asset to its estimated fair value.

During the fourth quarter of 2013, we discontinued three new venture concepts, Rubi^TM, Crisp Market^TM and Star Studio^TM. During the second quarter of 2013 we discontinued our Orango^TM concept. As a result of the decision to discontinue the four concepts, for each concept we estimated the fair value of assets held utilizing a cash flow approach. For each of the concepts and for certain shared service assets used for the new ventures, as of December 31, 2013, we estimated the fair value of the assets was zero and recorded impairment charges for each concept. See Note 12: Discontinued Operationsfor additional information.

On January 23, 2015, we made the decision to shut down our Redbox Canada operations as the business was not meeting the Company's performance expectations. On March 31, 2015, we completed the disposal of the Redbox Canada operations. As a result, we updated certain estimates used in the preparation of the financial statements and the remaining value of certain capitalized property and equipment, consisting primarily of installation costs, was amortized over the wind-down period ending March 31, 2015. See Note 12: Discontinued Operationsfor additional information.

Income Tax, Policy

Income Taxes

Deferred income taxes are provided for the temporary differences between the financial reporting basis and the tax basis of our assets and liabilities and operating loss and tax credit carryforwards. We record a valuation allowance to reduce deferred tax assets to the amount expected to more likely than not be realized in our future tax returns. Deferred tax assets and liabilities and operating loss and tax credit carryforwards are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences and operating loss and tax credit carryforwards are expected to be recovered or settled.

We assess our income tax positions and record tax benefits for all years subject to examination based upon management’s evaluation of the facts, circumstances and information available at the reporting date. For those tax positions where it is more likely than not that a tax benefit will be sustained, we have recorded the largest amount of tax benefit with a greater than 50% likelihood of being realized upon ultimate or effective settlement with a taxing authority that has full knowledge of all relevant information. In the event of a tax position where it would not be more likely than not that a tax benefit would be sustained, no tax benefit would be recognized in the financial statements. When applicable, associated interest and penalties have been recognized as a component of income tax expense. See Note 18: Income Taxes From Continuing Operations for additional information.

Tax Collected From Customers And Remitted To Governmental Authorities, Policy

Taxes Collected from Customers and Remitted to Governmental Authorities

We account for tax assessed by a governmental authority that is directly imposed on a revenue-producing transaction (i.e., sales, value added) on a net (excluded from revenue) basis.

Convertible Debt, Policy

Convertible Debt

In September 2009, we issued $200.0 million aggregate principal amount of 4% Convertible Senior Notes (the “Convertible Notes”). The Convertible Notes were convertible as of December 31, 2013 and the debt conversion feature was classified as temporary equity on our Consolidated Balance Sheets. On September 2, 2014, the Convertible Notes matured. In 2014, we retired or settled upon maturity, a combined 51,148 Convertible Notes for total consideration of $51.1 million in cash and the issuance of 431,760 shares of common stock. The amount by which total consideration exceeded the fair value of the Convertible Notes has been recorded as a reduction of stockholders’ equity. The loss from early extinguishment of the Convertible Notes was approximately $0.3 million and is recorded in interest expense in our Consolidated Statements of Comprehensive Income.

Loss Contingencies, Policy

Loss Contingencies

We accrue estimated liabilities for loss contingencies arising from claims, assessments, litigation and other sources when it is probable that a liability has been incurred and the amount of the claim assessment or damages can be reasonably estimated. We believe that we have sufficient accruals to cover any obligations resulting from claims, assessments or litigation that have met these criteria.

Revenue Recognition, Policy

Revenue Recognition

We recognize revenue when persuasive evidence of a sale arrangement exists, delivery has occurred or services are rendered, the sales price or fee is fixed or determinable and collectability is reasonably assured as follows:

• Redbox - Revenue from movie and video game rentals is recognized ratably over the term of a consumer’s rental transaction. Revenue from a direct sale out of the kiosk of previously rented movies or video games is recognized at the time of sale. On rental transactions for which the related movie or video game has not yet been returned to the kiosk at month-end, revenue is recognized with a corresponding receivable recorded in the balance sheet, net of a reserve for potentially uncollectible amounts. We record revenue net of refunds and applicable sales taxes collected from consumers. In the fourth quarter of 2014, Redbox launched Redbox Play Pass, a new loyalty program, where customers can earn points redeemable for movie rentals. As customers accumulate points, we defer the estimated fair value of the points earned as deferred revenue (included within other current accrued liabilities). We deferred $2.5 million and $1.5 million as of December 31, 2015 and December 31, 2014, respectively. 

• Coinstar - Revenue from a coin transaction, which is collected from either consumers or card issuers (in stored value product transactions), is recognized at the time the consumers’ coins are collected by our coin-counting kiosks. Our revenue represents the fee charged for coin transactions.

• ecoATM - Revenue is recognized upon the sale and shipment of devices collected to third parties and consumers.

• All Other - Revenue was recognized in our discontinued SAMPLEit concept when the service transaction was completed.

Fees Paid To Retailers, Policy

Fees Paid to Retailers

Fees paid to retailers relate to the amount we pay our retailers for the benefit of placing our kiosks in their stores and their agreement to provide certain services on our behalf to our consumers. The fee is generally calculated as a percentage of each coin-counting transaction or as a percentage of our net movie or video game rental revenue or a fixed fee and is recorded in our Consolidated Statements of Comprehensive Income within Direct operating expenses. The fee arrangements are based on our negotiations and evaluation of certain factors with the retailers such as total revenue, long-term non-cancelable contracts, installation of our kiosks in high traffic and/or urban or rural locations, co-op marketing incentives, or other criteria.

Advertising, Policy

Advertising

Advertising costs, which are included as a component of marketing expenses, are expensed as incurred and totaled $15.2 million, $11.8 million and $11.7 million in 2015, 2014 and 2013, respectively.

Research and Development, Policy

Research and Development

Costs incurred for research and development activities are expensed as incurred.

Foreign Currency Translations, Policy

Foreign Currency Translation

The functional currencies of our international subsidiaries are the British pound Sterling for our subsidiary Coinstar Limited in the United Kingdom, Canadian dollar for Coinstar International and Redbox Canada GP, and the Euro for our Coinstar Ireland Limited subsidiary. We translate assets and liabilities related to these operations to U.S. dollars at the exchange rate in effect at the date of the Consolidated Balance Sheets; we convert revenues and expenses into U.S. dollars using average exchange rates. Transaction gains and losses including on foreign currency intercompany transactions not deemed to be of a long term investment nature are included in Other income (expense), net on our Consolidated Statements of Comprehensive Income, except for those associated with discontinued operations which are included in Loss from discontinued operations, net of tax on our Consolidated Statements of Comprehensive Income. Translation gains and losses, including gains and losses on foreign currency intercompany transactions deemed to be of a long term investment nature, are reported as Accumulated other comprehensive loss in our Consolidated Balance Sheets.

Share-Based Payments, Policy

Share-Based Payments

We measure and recognize expense for all share-based payment awards granted, including employee stock options and restricted stock awards, based on the estimated fair value of the award on the grant date. We utilize the Black-Scholes-Merton (“BSM”) valuation model for valuing our stock option awards and the determination of the expenses.

The use of the BSM valuation model to estimate the fair value of stock option awards requires us to make judgments on assumptions regarding the risk-free interest rate, expected dividend yield, expected term and expected volatility over the expected term of the award. The assumptions used in calculating the fair value of share-based payment awards represent management’s best estimates at the time they are made, but these estimates involve inherent uncertainties and the determination of expense could be materially different in the future.

We amortize share-based payment expense on a straight-line basis over the vesting period of the individual award with estimated forfeitures considered. Vesting periods are generally four years. Expense for performance based shares is recognized over the vesting period if and when we conclude that it is probable that the performance condition will be achieved. We reassess the probability of vesting at each reporting period for awards with performance conditions and adjust compensation cost based on our probability assessment.

Shares to be issued upon the exercise of stock options will come from newly issued shares. The expense related to restricted stock granted to movie studios as part of license agreements is adjusted based on the number of unvested shares and market price of our common stock each reporting period.

Share-based payment expense is only recognized on awards that ultimately vest. Therefore, we have reduced the share-based payment expense to be recognized over the vesting period for anticipated future forfeitures. Forfeiture estimates are based on historical forfeiture patterns. We review and assess our forfeiture estimates quarterly and update them if necessary. Any changes to accumulated share-based payment expense are recognized in the period of change. If actual forfeitures differ significantly from our estimates, our results of operations could be materially impacted. For additional information see Note 10: Share-Based Payments.

Reclassifications, Policy

Reclassifications

To be consistent with our 2015 reporting, the following have been retrospectively reported in our Consolidated Statements of Comprehensive Income for all periods presented with no effect on net income, cash flows or stockholder's equity:

• Results of our Redbox Canada operations which were discontinued during the first quarter of 2015. See Note 12: Discontinued Operationsforadditional information;

• Restructuring and related costs. See Note 11: Restructuring for additional information; and

• Basic and diluted earnings per share as a result of applying the two-class method of calculating earnings per share (the “Two-Class Method”). During the first quarter of 2015, the Two-Class Method became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards (“participating securities”) as a percentage of total common shares outstanding. The impact of applying the Two-Class Method on both income from continuing operations and basic and diluted weighted average shares used to calculate earnings per common share is as follows:

	As Reported Under the Treasury Stock Method				Amount Allocated to Participating Securities						As Revised Under the Two-Class Method
In thousands, except per share data	2014		2013		2014			2013			2014		2013
Income from continuing operations used in basic per share calculation	$	124,677	$	222,688	$	(3,929	)	$	(5,473	)	$	120,748	$	217,215
Income from continuing operations used in diluted per share calculation	$	124,677	$	222,688	$	(3,871	)	$	(5,294	)	$	120,806	$	217,394
Weighted average shares used in basic per share calculation	20,192		27,216		—			—			20,192		27,216
Weighted average shares used in diluted per share calculation	20,699		28,381		(196		)	(212		)	20,503		28,169
Basic earnings per common share from continuing operations	$	6.17	$	8.18	$	(0.19	)	$	(0.20	)	$	5.98	$	7.98
Diluted earnings per common share from continuing operations	$	6.02	$	7.85	$	(0.13	)	$	(0.13	)	$	5.89	$	7.72

See Note 13: Earnings Per Sharefor additional information.

The accompanying consolidated financial statements include the accounts of Outerwall Inc. and our wholly-owned subsidiaries. Investments in companies of which we may have significant influence, but not a controlling interest, are accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation.

Accounting Pronouncements Adopted During the Current Year, Policy

Accounting Pronouncements Adopted During the Current Year

In April 2014, the FASB issued ASU 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360) Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU 2014-08 changes the requirements for reporting discontinued operations. Under the ASU discontinued operations is defined as a:

• Component of an entity, or group of components, that

◦ has been disposed of, meets the criteria to be classified as held-for-sale, or has been abandoned/spun-off and

◦ represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results, or a

◦ business or nonprofit activity that, on acquisition, meets the criteria to be classified as held-for-sale.

We adopted the provisions of ASU 2014-08 during the first quarter of 2015 and applied the guidance to our disposition of our Redbox operations in Canada (“Redbox Canada”). See Note 12: Discontinued Operationsfor additional information.

In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. This ASU requires all deferred tax assets and liabilities to be presented in the balance sheet as noncurrent and is effective for us in our fiscal year beginning January 1, 2016. We elected to early adopt this new guidance in the fourth quarter of 2015 and have applied the changes retrospectively. The changes to our 2014 Consolidated Balance Sheet as a result of adopting the new guidance are as follow:

In thousands, except per share data	As Reported		Reclassifications			As Revised
Assets:
Prepaid expenses and other current assets	$	39,837	$	(18	)	$	39,819
Deferred income taxes - long term	$	11,378	$	(15	)	$	11,363
Liabilities:
Deferred income taxes - current	$	21,432	$	(21,432	)	$	—
Deferred income taxes - long term	$	38,375	$	21,399		$	59,774

Accounting Pronouncements Not Yet Adopted

In April 2015, the FASB issued ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs (Subtopic 835-30). This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, instead of as a deferred charge. In August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements (Subtopic 835-30). This ASU provides additional guidance to ASU 2015-03, which did not address presentation or subsequent measurement of debt issuance costs related to line-of-credit arrangements. ASU 2015-15 noted that the SEC staff would not object to an entity deferring and presenting debt issuance costs as an asset and subsequently amortizing the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted. As of December 31, 2015, we had $3.8 million of deferred financing fees recorded in other long-term assets in our Consolidated Balance Sheets.

In April 2015, the FASB issued ASU 2015-05, Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement. This ASU provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The guidance will not change GAAP for a customer’s accounting for service contracts. We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09 requires revenue recognition to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. In July 2015, the FASB deferred the effective date for annual reporting periods beginning after December 15, 2017. Early adoption is permitted to the original effective date of December 15, 2016. The amendments may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of initial application. We are currently in the process of evaluating the impact of ASU 2014-09.

In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern. This ASU describes how an entity’s management should assess whether there are conditions and events that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date that the financial statements are issued. Management should consider both quantitative and qualitative factors in making its assessment.

If after considering management’s plans, substantial doubt about an entity’s going concern is alleviated, an entity shall disclose information in the footnotes that enables the users of the financial statements to understand the events that raised the going concern and how management’s plan alleviated this concern.

If after considering management’s plans, substantial doubt about an entity’s going concern is not alleviated, the entity shall disclose in the footnotes indicating that a substantial doubt about the entity’s going concern exists within one year of the date of the issued financial statements. Additionally, the entity shall disclose the events that led to this going concern and management’s plans to mitigate them.

We do not expect this standard to have a material impact to our consolidated financial statements and related disclosures, which is effective for us in our fiscal year beginning January 1, 2016. Early adoption is permitted.

Earnings Per Share, Policy

Beginning in the first quarter of 2015, we began applying the two-class method of calculating basic and diluted earnings per share (the “Two-Class Method”) as it became significantly more dilutive than the previously applied treasury stock method as a result of stock repurchases increasing the average number of unvested restricted awards as a percentage of total common shares outstanding.

The Two-Class Method is an earnings allocation formula that treats a participating security, as having rights to earnings that otherwise would have been available to common shareholders and assumes all earnings for the period are distributed. Our unvested service-based restricted stock awards granted are participating securities as they entitle recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to the dividends paid to holders of common stock.

Segment Reporting, Policy

Management, including our chief operating decision maker, who is our CEO, evaluates the performances of our business segments primarily on segment revenue and segment operating income (loss) before depreciation, amortization and other, and share-based compensation granted to executives, non-employee directors and employees (“segment operating income (loss)”). Segment operating income (loss) contains internally allocated costs of our shared service support functions, including but not limited to, corporate executive management, business development, sales, finance, legal, human resources, information technology and risk management. We also review depreciation and amortization allocated to each segment. Share-based payments expense related to share-based compensation granted to executives, non-employee directors and employees and expense related to the rights to receive cash issued in connection with our acquisition of ecoATM are not allocated to our segments and are included in the Corporate Unallocated column in the analysis and reconciliation below; however, share-based payments expense related to our content arrangements with certain movie studios has been allocated to our Redbox segment and is included within direct operating expenses. Our performance evaluation does not include segment assets.

Fair Value of Financial Instruments, Policy

Fair Value of Financial Instruments

The carrying amounts for cash equivalents approximate fair value, which is the amount for which the instrument could be exchanged in a current transaction between willing parties. Available-for-sale securities are marked to fair value on a quarterly basis. The fair value of our revolving line of credit approximates its carrying amount. For additional information see Note 15: Fair Value.

To measure fair value, we use a three-tier valuation hierarchy based upon observable and non-observable inputs:

• Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities;

• Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; or

• Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions.

The factors or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

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Organization and Business (Tables)

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Kiosk And Location Counts

Our kiosk and location counts as of December 31, 2015, are as follows:

	Kiosks	Locations
Redbox	40,480	33,060
Coinstar	20,930	19,660
ecoATM	2,250	2,020
All Other(1)	120	120
Total	63,780	54,860

(1) As part of our decision to discontinue operating SAMPLEit in the fourth quarter of 2015, all SAMPLEit kiosks were removed from their locations during January 2016.

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Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Property and Equipment, Useful Lives

Depreciation is recognized using the straight-line method over the following approximate useful lives:

	Useful Life
Coin-counting kiosks and components	2 - 10 years
Redbox kiosks and components	3 - 5 years
ecoATM kiosk and components	5 years
Computers and software	3 - 5 years
Office furniture and equipment	5 - 7 years
Leased vehicles	3 - 6 years
Leasehold improvements (shorter of life of asset or remaining lease term)	1 - 11 years

	December 31,
Dollars in thousands	2015			2014
Kiosks and components	$	1,163,210		$	1,165,925
Computers, servers, and software	193,507			200,915
Leasehold improvements	22,663			29,625
Office furniture and equipment	7,047			9,218
Vehicles	5,118			6,234
Property and equipment, at cost	1,391,545			1,411,917
Accumulated depreciation and amortization	(1,075,532		)	(983,449		)
Property and equipment, net	$	316,013		$	428,468

Comparison of Earnings Per Share Calculation Methods

The impact of applying the Two-Class Method on both income from continuing operations and basic and diluted weighted average shares used to calculate earnings per common share is as follows:

	As Reported Under the Treasury Stock Method				Amount Allocated to Participating Securities						As Revised Under the Two-Class Method
In thousands, except per share data	2014		2013		2014			2013			2014		2013
Income from continuing operations used in basic per share calculation	$	124,677	$	222,688	$	(3,929	)	$	(5,473	)	$	120,748	$	217,215
Income from continuing operations used in diluted per share calculation	$	124,677	$	222,688	$	(3,871	)	$	(5,294	)	$	120,806	$	217,394
Weighted average shares used in basic per share calculation	20,192		27,216		—			—			20,192		27,216
Weighted average shares used in diluted per share calculation	20,699		28,381		(196		)	(212		)	20,503		28,169
Basic earnings per common share from continuing operations	$	6.17	$	8.18	$	(0.19	)	$	(0.20	)	$	5.98	$	7.98
Diluted earnings per common share from continuing operations	$	6.02	$	7.85	$	(0.13	)	$	(0.13	)	$	5.89	$	7.72

Early Adoption of ASU 2015-17 Income Taxes

The changes to our 2014 Consolidated Balance Sheet as a result of adopting the new guidance are as follow:

In thousands, except per share data	As Reported		Reclassifications			As Revised
Assets:
Prepaid expenses and other current assets	$	39,837	$	(18	)	$	39,819
Deferred income taxes - long term	$	11,378	$	(15	)	$	11,363
Liabilities:
Deferred income taxes - current	$	21,432	$	(21,432	)	$	—
Deferred income taxes - long term	$	38,375	$	21,399		$	59,774

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Business Combinations (Tables)

12 Months Ended

Dec. 31, 2015

Business Combinations [Abstract]

Business Combinations, Assets Acquired and Liabilities Assumed

The following table shows the consideration transferred and the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed and the resultant purchase price allocation.

Dollars in thousands	November 10, 2015
Total consideration transferred	$	17,980
Assets acquired:
Accounts receivable	$	67
Prepaid expenses and other current assets	3,963
Property and equipment	252
Intangible assets	16,000
Total assets acquired	20,282
Liabilities assumed:
Deferred revenue	(750		)
Deferred tax liabilities	(563		)
Total liabilities assumed	(1,313		)
Total net assets acquired	$	18,969
Bargain purchase gain	$	989

Intangible Assets Acquired and Estimated Useful Life

Acquired identifiable intangible assets and their estimated useful life in years are as follows:

Dollars in thousands	Purchase Price		Estimated Useful Life in Years
Trade name	$	14,000	10
Developed technology	$	2,000	3

Revenue and Operating Loss from the Acquisition of Gazelle

The following table shows the revenue and operating loss included in our Consolidated Statements of Comprehensive Income resulting from the acquisition of Gazelle since the closing date, including the amortization for acquired intangibles which are included in our ecoATM segment:

	Year Ended
Dollars in thousands	December 31, 2015
Revenue	$	13,269
Operating loss	$	948

Pro Forma Information

Pro forma information

The following unaudited pro forma information represents the results of operations for Outerwall Inc. and includes the Gazelle business acquired as if the acquisition was consummated as of January 1, 2014.

	Years Ended December 31,
	(Unaudited)
Dollars in thousands	2015		2014
Pro-forma revenue	$	2,264,467	$	2,378,508
Pro-forma income from continuing operations	$	38,524	$	114,641

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Prepaid Expenses and Other Current Assets and Other Accrued Liabilities (Tables)

12 Months Ended

Dec. 31, 2015

Prepaid Expenses and Other Current Assets and Other Accrued Liabilities [Abstract]

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets

	December 31,
Dollars in thousands	2015		2014
Spare parts	$	9,780	$	13,643
Licenses	6,394		5,881
Electronic devices inventory	7,846		5,259
Income taxes receivable	9,517		95
Prepaid rent	1,043		1,446
DVD cases and labels	1,371		1,330
Other	15,417		12,165
Total prepaid and other current assets	$	51,368	$	39,819

Other Accrued Liabilities

Other accrued liabilities

	December 31,
Dollars in thousands	2015		2014
Payroll related expenses	$	40,676	$	33,343
Studio revenue share and other content related expenses	28,964		23,226
Business taxes	16,080		21,629
Insurance	13,594		9,615
Deferred revenue	11,201		6,995
Income taxes payable	16		9,463
Accrued interest expense	6,913		6,974
Accrued early lease termination and sublease expenses	4,991		—
Service contract provider expenses	4,070		4,191
Deferred rent expense	1,728		6,162
Other	13,204		15,528
Total other accrued liabilities	$	141,437	$	137,126

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Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2015

Property, Plant and Equipment [Abstract]

Property and Equipment

Depreciation is recognized using the straight-line method over the following approximate useful lives:

	Useful Life
Coin-counting kiosks and components	2 - 10 years
Redbox kiosks and components	3 - 5 years
ecoATM kiosk and components	5 years
Computers and software	3 - 5 years
Office furniture and equipment	5 - 7 years
Leased vehicles	3 - 6 years
Leasehold improvements (shorter of life of asset or remaining lease term)	1 - 11 years

	December 31,
Dollars in thousands	2015			2014
Kiosks and components	$	1,163,210		$	1,165,925
Computers, servers, and software	193,507			200,915
Leasehold improvements	22,663			29,625
Office furniture and equipment	7,047			9,218
Vehicles	5,118			6,234
Property and equipment, at cost	1,391,545			1,411,917
Accumulated depreciation and amortization	(1,075,532		)	(983,449		)
Property and equipment, net	$	316,013		$	428,468

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Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Gross Amount and Accumulated Impairment

Gross amount of goodwill and accumulated impairment charges that we have recorded are as follows:

Dollars in thousands
Goodwill	$	559,307
Accumulated impairment losses	(85,890		)
Net goodwill at December 31, 2015	$	473,417

Goodwill by Segment

A reconciliation of the beginning and ending carrying amounts of goodwill by segment is as follows:

Dollars in thousands	December 31, 2014		Goodwill Impairment			December 31, 2015
Redbox	$	138,743	$	—		$	138,743
Coinstar	156,351		—			156,351
ecoATM	264,213		(85,890		)	178,323
Total goodwill	$	559,307	$	(85,890	)	$	473,417

Gross Amount Of Other Intangible Assets And The Related Accumulated Amortization

The gross amount of our other intangible assets and the related accumulated amortization were as follows:

Dollars in thousands	Amortization	December 31,
	Period	2015			2014
Retailer relationships	5 - 10 years	$	53,295		$	53,295
Accumulated amortization		(27,212		)	(23,200		)
Retailer relationships, net		26,083			30,095
Developed technology	3 - 5 years	36,000			34,000
Accumulated amortization		(16,544		)	(9,633		)
Developed technology, net		19,456			24,367
Trade names	5 - 10 years	20,000			6,000
Accumulated amortization		(3,133		)	(1,700		)
Trade names, net		16,867			4,300
Other	1 - 40 years	10,800			10,800
Accumulated amortization		(6,109		)	(4,871		)
Other, net		4,691			5,929
Total intangible assets, net		$	67,097		$	64,691

Amortization Of Intangible Assets

Amortization expense was as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Retailer relationships	$	4,012		$	5,432		$	6,250
Developed technology	6,911			6,800			2,833
Trade names	1,433			1,200			500
Other	1,238			1,260			1,350
Total amortization of intangible assets	$	13,594		$	14,692		$	10,933
Less: amortization included in discontinued operations	(44		)	(38		)	(26		)
Total amortization of intangible assets from continuing operations	$	13,550		$	14,654		$	10,907

Future Amortization Expense

Assuming no future impairment, the expected future amortization as of December 31, 2015, is as follows:

Dollars in thousands	Retailer Relationships		Developed Technology		Trade Names		Other		Total
2016	$	4,012	$	7,467	$	2,600	$	1,081	$	15,160
2017	4,012		7,467		2,600		1,081		15,160
2018	4,012		4,522		2,100		964		11,598
2019	4,012		—		1,400		801		6,213
2020	4,012		—		1,400		407		5,819
Thereafter	6,023		—		6,767		357		13,147
Total expected amortization	$	26,083	$	19,456	$	16,867	$	4,691	$	67,097

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Equity Method Investments (Tables)

12 Months Ended

Dec. 31, 2015

Equity Method Investments and Joint Ventures [Abstract]

Contributions to Equity Method Investment

The following table summarizes Redbox's initial cash capital contribution and subsequent cash capital contributions representing its pro-rata share of requests made by the Joint Venture board of managers:

Dollars in thousands	Cash Contributions
2012	$	24,500
2013	28,000
2014	24,500
Total cash capital contributions	$	77,000

Schedule of Equity Method Investments

Income (loss) from equity method investments within our Consolidated Statements of Comprehensive Income is composed of the following:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Gain on previously held equity interest on ecoATM	$	—		$	—		$	68,376
Proportionate share of net loss of equity method investees:
Joint Venture	—			(25,793		)	(42,660		)
Pursuant Health and ecoATM	(800		)	(530		)	(3,313		)
Total proportionate share of net loss of equity method investees	(800		)	(26,323		)	(45,973		)
Amortization of difference in carrying amount and underlying equity in Joint Venture	—			(2,411		)	(2,475		)
Total income (loss) from equity method investments	$	(800	)	$	(28,734	)	$	19,928

A summary of financial information for our equity method investees in the aggregate, as provided to us by the investees, is as follows:

Balance Sheets(1)	December 31,
Dollars in thousands	2015		2014
Current assets	$	3,457	$	3,408
Noncurrent assets	$	13,394	$	20,376
Current liabilities	$	5,888	$	7,321
Long-term liabilities	$	22,811	$	18,754

(1) Represents Pursuant Health, Inc. only.

Statement of Operations	Year Ended December 31,
Dollars in thousands	2015		2014		2013
Revenue	$	7,389	$	29,963	$	15,824
Cost of sales and service	$	10,129	$	68,732	$	25,092
Net loss from continuing operations	$	6,107	$	140,919	$	134,911

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Debt and Other Long-Term Liabilities (Tables)

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Debt and Other Long Term Liabilities

	Debt														Other Liabilities							Total
	Senior Notes						Credit Facility					Total Debt			Capital Lease Obligations			Asset retirement obligations		Other long-term liabilities
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2015:
Principal	$	350,000		$	258,908		$	136,875		$	140,500	$	886,283
Discount	(3,275		)	(3,029		)	(260		)	—		(6,564		)
Total	346,725			255,879			136,615			140,500		879,719			$	5,889		$	9,412	$	19,477	$	914,497
Less: current portion	—			—			(13,125		)	—		(13,125		)	(4,006		)	—		—		(17,131		)
Total long-term portion	$	346,725		$	255,879		$	123,490		$	140,500	$	866,594		$	1,883		$	9,412	$	19,477	$	897,366
Unamortized deferred financing fees(1)	$	495		$	1,054		$	—		$	2,300	$	3,849									$	3,849

	Debt														Other Liabilities							Total
	Senior Notes						Credit Facility					Total Debt			Capital Lease Obligations			Asset retirement obligations		Other long-term liabilities
Dollars in thousands	2019 Notes			2021 Notes			Term Loans			Revolving Line of Credit
As of December 31, 2014:
Principal	$	350,000		$	300,000		$	146,250		$	160,000	$	956,250
Discount	(4,296		)	(4,152		)	(335		)	—		(8,783		)
Total	345,704			295,848			145,915			160,000		947,467			$	15,391		$	13,576	$	17,651	$	994,085
Less: current portion	—			—			(9,390		)	—		(9,390		)	(11,026		)	—		—		(20,416		)
Total long-term portion	$	345,704		$	295,848		$	136,525		$	160,000	$	938,077		$	4,365		$	13,576	$	17,651	$	973,669
Unamortized deferred financing fees(1)	$	649		$	1,372		$	—		$	2,965	$	4,986									$	4,986

(1) Deferred financing fees are recorded in other long-term assets in our Consolidated Balance Sheets and are amortized on a straight line basis over the life of the related loan.

Interest Expense

Interest Expense

Dollars in thousands	Year Ended December 31,
	2015			2014		2013
Cash interest expense	$	45,507		$	41,562	$	25,289
Non-cash interest expense:
Amortization of debt discount	1,731			2,606		4,674
Amortization of deferred financing fees	1,030			1,510		1,720
Other	—			—		(550		)
Total non-cash interest expense	2,761			4,116		5,844
Total cash and non-cash interest expense	48,268			45,678		31,133
(Gain) loss from early extinguishment of debt	(5,854		)	2,018		6,013
Total interest expense	$	42,414		$	47,696	$	37,146

Maturities of Term Loan

The Amended and Restated Credit Agreement requires principal amortization payments under the Term Loan as follows:

Dollars in thousands	Repayment Amount
2016	$	13,125
2017	15,000
2018	18,750
2019	90,000
Total	$	136,875

Other Long-term Liabilities

Included in other long-term liabilities were primarily tenant improvements related to our office building renovation in Oakbrook Terrace, Illinois; Bellevue, Washington; and San Diego, California as well as the related unrecognized tax benefits as follows:

Dollars in thousands	December 31,
	2015		2014
Tenant improvement and deferred rent and other	$	12,592	$	13,012
Unrecognized tax benefit	6,885		4,639
Total other long-term liabilities	$	19,477	$	17,651

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Repurchases of Common Stock (Tables)

12 Months Ended

Dec. 31, 2015

Class of Stock Disclosures [Abstract]

Summary of Stock Repurchases

The following tables present a summary of our 2015 authorized stock repurchase balance and repurchases made during the past three years:

Dollars in thousands	Board Authorization
Authorized repurchase - as of January 1, 2015	$	163,655
Additional board authorization	250,000
Proceeds from the exercise of stock options	2,552
Repurchase of common stock from open market	(159,800		)
Authorized repurchase - as of December 31, 2015	$	256,407

Repurchases made in the year ended December 31,	Number of Shares Repurchased	Average Price per Share (in dollars)		Total Purchase Price (in thousands)
2015	2,514,139	$	63.56	$	159,800
2014
Tender offer(1)	5,291,701	$	70.07	370,789
Open market	2,633,526	$	64.77	170,582
Total 2014	7,925,227	$	68.31	541,371
2013	3,306,433	$	58.98	195,004
Total	13,745,799	$	65.20	$	896,175

(1) Fees and expenses totaling $3.7 million associated with the tender offer do not impact the repurchase program approved by our Board, are excluded from the total purchase price shown here and were recorded as part of the cost of treasury stock in our Consolidated Balance Sheets.

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Share-Based Payments (Tables)

12 Months Ended

Dec. 31, 2015

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Summary of Grant Information

The following is the summary of grant information:

Shares in thousands	December 31, 2015
Unissued common stock reserved for issuance under all plans	1,034
Shares available for future grants	979

Summary of Share Based Payments

Certain information regarding our share-based payments is as follows:

	Year Ended December 31,
Dollars in thousands except per share data	2015		2014		2013
Share-based payments expense:
Share-based compensation - stock options	$	293	$	803	$	1,566
Share-based compensation - restricted stock	12,102		11,214		10,504
Share-based payments for content arrangements	4,982		1,367		4,761
Total share-based payments expense	$	17,377	$	13,384	$	16,831
Tax benefit on share-based payments expense	$	6,736	$	5,134	$	6,392
Per share weighted average grant date fair value of stock options granted	$	—	$	—	$	53.90
Per share weighted average grant date fair value of restricted stock granted	$	66.67	$	71.37	$	53.94
Total intrinsic value of stock options exercised	$	1,061	$	3,263	$	10,567
Grant date fair value of restricted stock vested	$	12,631	$	13,036	$	12,641

	December 31, 2015
Dollars in thousands	Unrecognized Share-Based Payments Expense		Weighted-Average Remaining Life
Unrecognized share-based payments expense:
Share-based compensation - stock options	$	149	0.9 years
Share-based compensation - restricted stock	19,032		2.2 years
Share-based payments for content arrangements	1,090		0.8 years
Total unrecognized share-based payments expense	$	20,271

Summary of Stock Option Activity

The following table presents a summary of stock option activity for 2015:

Shares in thousands	Options		Weighted Average Exercise Price
Outstanding, December 31, 2014	128		$	52.59
Granted	—		$	—
Exercised	(49	)	$	52.10
Canceled, expired, or forfeited	(24	)	$	53.99
Outstanding, December 31, 2015	55		$	52.40

Information Regarding Stock Options Outstanding

Certain information regarding stock options outstanding as of December 31, 2015, is as follows:

	Options
Shares and intrinsic value in thousands	Outstanding		Exercisable
Number	55		39
Weighted average per share exercise price	$	52.40	$	51.67
Aggregate intrinsic value	$	35	$	35
Weighted average remaining contractual term (in years)	6.33		6.09

Summary of Restricted Stock Award Activity

The following table presents a summary of restricted stock award activity for 2015:

Shares in thousands	Restricted Stock Awards		Weighted Average Grant Date Fair Value
Non-vested, December 31, 2014	609		$	62.35
Granted	352		$	66.67
Vested	(188	)	$	59.09
Forfeited	(217	)	$	65.26
Non-vested, December 31, 2015	556		$	65.86

Information Related To Share Based Payments For Content Arrangements

Information related to the shares of restricted stock granted as part of these agreements as of December 31, 2015, is as follows:

Whole shares	Granted	Vested	Unvested
Sony(1)	243,348	243,348	—
Paramount(2)(3)	350,000	350,000	—

Expected Amortization Expense of Share-Based Compensation

The expected future recognition of expense associated with the rights to receive cash as of December 31, 2015 is as follows:

Dollars in thousands	Expected Expense
2016	$	1,868
2017	284
Remaining total expected expense	$	2,152

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Restructuring (Tables)

12 Months Ended

Dec. 31, 2015

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs

The total amount incurred for restructuring, exclusive of asset impairments incurred by reportable segment (on an allocated basis) and expense type is as follows:

	Year Ended December 31,
Dollars in thousands	2015
Redbox
Severance	$	4,236
Lease termination and related costs (excluding related asset impairments)	4,958
Purchase commitment settlement costs	7,021
Total Redbox restructuring costs	16,215
Coinstar
Severance	492
Lease termination and related costs (excluding related asset impairments)	100
Purchase commitment settlement costs	1,369
Total Coinstar restructuring costs	1,961
ecoATM
Severance	602
Lease termination and related costs (excluding related asset impairments)	—
Purchase commitment settlement costs	85
Total ecoATM restructuring costs	687
All Other
Severance	822
Lease termination and related costs (excluding related asset impairments)	2
Purchase commitment settlement costs	26
Total All Other restructuring costs	850
Total restructuring costs in continuing operations	19,713
Restructuring costs in discontinued operations	522
Total restructuring costs	$	20,235

Restructuring and Related Costs from Continuing Operations

	Year Ended December 31,
Dollars in thousands	2015
Restructuring costs	$	20,235
Impairment of lease related assets (see Note 5)	7,440
Total restructuring and related costs	27,675
Less: restructuring costs included in discontinued operations	(522		)
Restructuring and related costs from continuing operations	$	27,153

Restructuring Reserve by Type of Cost

A reconciliation of the beginning and ending liability balance by expense type is as follows:

Dollars in thousands	Severance Expense			Lease Termination Costs			Other
Beginning Balance - January 1, 2015	$	—		$	—		$	—
Costs charged to expense(1)	6,284			5,138			8,813
Reclassification of deferred balances(2)	—			5,260			—
Costs paid or otherwise settled	(4,899		)	(5,407		)	(8,813		)
Ending Balance - December 31, 2015	$	1,385		$	4,991		$	—

(1) Other includes an $8.5 million one-time payment to settle an outstanding purchase commitment.

(2) Deferred rent liabilities related to the early lease termination that were reclassified to present the outstanding liability related to the terminated leases.

Restructuring and Related Costs - 2013 Restructuring Plan

Dollars in thousands	Cumulative as of December 31, 2014		Year Ended December 31, 2014		Year Ended December 31, 2013
Redbox
Severance	$	4,305	$	534	$	3,771
Coinstar
Severance	747		23		724
Total restructuring costs in continuing operations	5,052		557		4,495
Restructuring costs in discontinued operations	2,899		590		2,309
Total restructuring costs	$	7,951	$	1,147	$	6,804

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Discontinued Operations (Tables)

12 Months Ended

Dec. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations Included in Financial Statements

The following table sets forth the components of discontinued operations included in our Consolidated Statements of Comprehensive Income:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Redbox Canada revenue	$	1,972		$	11,417		$	6,816
Certain new ventures revenue	—			100			4,399
Total revenue	$	1,972		$	11,517		$	11,215
Redbox Canada loss before income tax	$	(13,605	)	$	(23,707	)	$	(19,830	)
Certain new ventures loss before income tax	—			(1,259		)	(54,395		)
Total loss before income tax:	(13,605		)	(24,966		)	(74,225		)
Redbox Canada income tax benefit	8,496			6,416			5,233
Certain new ventures income tax benefit	—			491			21,096
Total income tax benefit	8,496			6,907			26,329
Redbox Canada loss, net of tax	(5,109		)	(17,291		)	(14,597		)
Certain new ventures loss, net of tax	—			(768		)	(33,299		)
Total loss from discontinued operations, net of tax	$	(5,109	)	$	(18,059	)	$	(47,896	)

Discontinued Operations Included in Financial Statements - Redbox Canada

The following table sets forth the components of discontinued operations included in our Consolidated Statements of Comprehensive Income:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Major classes of line items constituting pretax loss of discontinued operations:
Revenue	$	1,972		$	11,417		$	6,816
Direct operating	4,533			20,027			18,278
Marketing	112			2,947			2,175
Research and development	—			—			2
General and administrative	117			1,078			3,088
Restructuring and related costs	522			—			—
Depreciation and other	5,857			7,354			2,760
Amortization of intangible assets	44			38			26
Other expense, net	(4,392		)	(3,680		)	(317		)
Pretax loss of discontinued operations related to major classes of pretax loss	(13,605		)	(23,707		)	(19,830		)
Income tax benefit(1)	8,496			6,416			5,233
Net loss on discontinued operations	$	(5,109	)	$	(17,291	)	$	(14,597	)

Discontinued Operations Cash Flows

Significant operating and investing cash flows of Redbox Canada were as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Net loss on discontinued operations	$	(5,109	)	$	(17,291	)	$	(14,597	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Depreciation and amortization	5,901			7,392			2,786
Content library	3,328			(787		)	(410		)
Prepaid and other current assets	1,329			(293		)	(516		)
Accounts payable	(2,663		)	627			644
Accrued payables to retailers	(155		)	(175		)	247
Other accrued liabilities	(806		)	(122		)	506
Net cash flows from operating activities	$	1,825		$	(10,649	)	$	(11,340	)
Investing activities:
Purchase of property, plant and equipment	(292		)	(5,494		)	(9,330		)
Total cash flows used in investing activities	$	(292	)	$	(5,494	)	$	(9,330	)

Asset Impairment Charges

Dollars in thousands	Impairment Expense
Rubi	$	21,317
Orango	5,551
Crisp Market	289
Star Studio	2,786
Corporate assets utilized for discontinued concepts	2,789
Total impairment expense	$	32,732

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Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2015

Earnings Per Share [Abstract]

Basic and Diluted EPS Calculations

Our calculation of basic and diluted earnings per share is as follows:

	Year Ended December 31,
In thousands, except per share data	2015			2014			2013
Numerator
Income from continuing operations	$	49,446		$	124,677		$	222,688
Loss from discontinued operations, net of tax	(5,109		)	(18,059		)	(47,896		)
Net income	$	44,337		$	106,618		$	174,792
Income from continuing operations	$	49,446		$	124,677		$	222,688
Dividends and undistributed income allocated to participating shares	(1,329		)	(3,929		)	(5,473		)
Income from continuing operations to common shares - basic	48,117			120,748			217,215
Effect of reallocating undistributed income from continuing operations to participating shares	1			58			179
Income from continuing operations to common shares - diluted	$	48,118		$	120,806		$	217,394
Denominator
Weighted average common shares - basic	17,467			20,192			27,216
Dilutive effect of share-based payment awards	20			81			235
Dilutive effect of convertible debt	—			230			718
Weighted average common shares - diluted(1)	17,487			20,503			28,169
Basic earnings (loss) per common share:
Continuing operations	$	2.75		$	5.98		$	7.98
Discontinued operations	(0.29		)	(0.89		)	(1.76		)
Basic earnings per common share	$	2.46		$	5.09		$	6.22
Diluted earnings (loss) per common share:
Continuing operations	$	2.75		$	5.89		$	7.72
Discontinued operations	(0.29		)	(0.88		)	(1.70		)
Diluted earnings per common share	$	2.46		$	5.01		$	6.02
Stock options and share-based awards not included in diluted EPS calculation because their effect would have be antidilutive	7			11			13

(1) Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive than the calculation using the treasury stock method.

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Business Segments and Enterprise-Wide Information (Tables)

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Segment Reporting Information, by Segment

Dollars in thousands
Year Ended December 31, 2015	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,760,899		$	318,611		$	113,558		$	143		$	—		$	2,193,211
Expenses:
Direct operating	1,213,744			159,211			113,141			4,431			2,561			1,493,088
Marketing	19,804			5,566			8,481			1,128			695			35,674
Research and development	—			—			5,545			(84		)	1,737			7,198
General and administrative	129,013			31,561			10,875			7,188			11,756			190,393
Restructuring and related costs (Note 11)	23,540			2,076			687			850			—			27,153
Goodwill impairment (Note 6)	—			—			85,890			—			—			85,890
Segment operating income (loss)	374,798			120,197			(111,061		)	(13,370		)	(16,749		)	353,815
Less: depreciation and amortization	(118,902		)	(31,871		)	(26,382		)	(7,785		)	—			(184,940		)
Operating income (loss)	255,896			88,326			(137,443		)	(21,155		)	(16,749		)	168,875
Loss from equity method investments, net	—			—			—			—			(800		)	(800		)
Interest expense, net	—			—			—			—			(42,353		)	(42,353		)
Other, net	—			—			—			—			(2,657		)	(2,657		)
Income (loss) from continuing operations before income taxes	$	255,896		$	88,326		$	(137,443	)	$	(21,155	)	$	(62,559	)	$	123,065

Dollars in thousands
Year Ended December 31, 2014	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,881,718		$	315,628		$	94,187		$	53		$	—		$	2,291,586
Expenses:
Direct operating	1,318,509			161,214			92,182			2,821			6,585			1,581,311
Marketing	20,969			6,346			3,513			1,272			3,193			35,293
Research and development	120			531			5,691			2,854			3,851			13,047
General and administrative	135,554			26,989			12,773			3,522			11,658			190,496
Restructuring and related costs (Note 11)	534			23			—			—			—			557
Segment operating income (loss)	406,032			120,525			(19,972		)	(10,416		)	(25,287		)	470,882
Less: depreciation and amortization	(149,236		)	(35,471		)	(17,031		)	(740		)	—			(202,478		)
Operating income (loss)	256,796			85,054			(37,003		)	(11,156		)	(25,287		)	268,404
Loss from equity method investments, net	—			—			—			—			(28,734		)	(28,734		)
Interest expense, net	—			—			—			—			(47,644		)	(47,644		)
Other, net	—			—			—			—			(1,185		)	(1,185		)
Income (loss) from continuing operations before income taxes	$	256,796		$	85,054		$	(37,003	)	$	(11,156	)	$	(102,850	)	$	190,841

Dollars in thousands
Year Ended December 31, 2013	Redbox			Coinstar			ecoATM			All Other			Corporate Unallocated			Total
Revenue	$	1,967,715		$	300,218		$	31,824		$	28		$	—		$	2,299,785
Expenses:
Direct operating	1,365,368			158,562			27,271			2,162			3,636			1,556,999
Marketing	20,835			6,244			938			651			1,559			30,227
Research and development	76			6,962			2,772			1,897			1,375			13,082
General and administrative	160,863			25,220			7,868			7,683			14,164			215,798
Restructuring and related costs (Note 11)	3,771			724			—			—			—			4,495
Segment operating income (loss)	416,802			102,506			(7,025		)	(12,365		)	(20,734		)	479,184
Less: depreciation and amortization	(159,851		)	(33,921		)	(6,077		)	(459		)	—			(200,308		)
Operating income (loss)	256,951			68,585			(13,102		)	(12,824		)	(20,734		)	278,876
Loss from equity method investments, net	—			—			—			—			19,928			19,928
Interest expense, net	—			—			—			—			(32,807		)	(32,807		)
Other, net	—			—			—			—			(3,599		)	(3,599		)
Income (loss) from continuing operations before income taxes	$	256,951		$	68,585		$	(13,102	)	$	(12,824	)	$	(37,212	)	$	262,398

Significant Retailer Relationship

The following retailers accounted for 10% or more of our consolidated revenue:

	Year Ended December 31,
	2015		2014		2013
Wal-Mart Stores Inc.	16.6	%	15.5	%	15.2	%
Walgreen Co.	13.4	%	13.8	%	14.7	%
The Kroger Company	9.8	%	9.8	%	10.0	%

Revenue and Long-lived Assets by Geographic Location

Revenue is allocated to geographic locations based on the location of the kiosk. Revenue by geographic location was as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	2,145,887	$	2,242,753	$	2,254,790
All other	47,324		48,833		44,995
Total revenue	$	2,193,211	$	2,291,586	$	2,299,785

Long-lived assets by geographic location were as follows:

	Years Ended December 31,
Dollars in thousands	2015		2014		2013
U.S.	$	848,450	$	1,027,271	$	1,140,224
All other	14,133		33,426		38,406
Total long-lived assets	$	862,583	$	1,060,697	$	1,178,630

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Fair Value (Tables)

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis

The following table presents our financial assets and liabilities that are measured and reported at fair value in our Consolidated Balance Sheets on a recurring basis, by level within the fair value hierarchy (in thousands):

Fair Value at December 31, 2015	Level 1		Level 2		Level 3
Money market demand accounts and investment grade fixed income securities	$	2,743	$	—	$	—
Fair Value at December 31, 2014	Level 1		Level 2		Level 3
Money market demand accounts and investment grade fixed income securities	$	916	$	—	$	—

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Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Schedule of Capital Leased Assets

Assets held under capital leases are included in property and equipment, net on the Consolidated Balance Sheets and include the following:

Dollars in thousands	December 31,
	2015			2014
Gross property and equipment	$	26,394		$	41,336
Accumulated depreciation	(20,735		)	(26,831		)
Net property and equipment	$	5,659		$	14,505

Schedule of Future Minimum Lease Payments for Capital Leases

As of December 31, 2015, our future minimum lease payments, net of sublease income are as follows:

Dollars in thousands	Capital Leases			Operating Leases(1)
2016	$	4,144		$	18,969
2017	1,011			13,445
2018	429			10,215
2019	305			7,986
2020	209			4,936
Thereafter	123			7,132
Total minimum lease commitments	6,221			62,683
Less: sublease income	—			(1,332		)
Total minimum lease commitments, net	6,221			$	61,351
Less: amounts representing interest	(332		)
Present value of capital lease obligations	5,889
Less: Current portion of capital lease obligations	(4,006		)
Long-term portion of capital lease obligations	$	1,883

(1) Includes all operating leases having an initial or remaining non-cancelable lease term in excess of one year.

Schedule of Estimated Commitments Under Content License Agreements

We have entered into certain license agreements to obtain content for movie and video game rentals. A summary of the estimated movie commitments in relation to these agreements as of December 31, 2015, is presented in the following table:

Dollars in thousands	December 31,
	Total		2016		2017
Total estimated movie commitments(1)	$	448,718	$	381,275	$	67,443

Summary of General Terms of Content License Agreements

General terms of our content license agreements with studios are as follows as of December 31, 2015:

Studio	End Date		Release Date
Fox	6/30/2017		Delay	(1)
Sony	9/30/2016		Day & Date	(2)
Paramount	12/31/2016		Day & Date	(2)
Warner	3/31/2017		Delay	(1)
Lionsgate	9/30/2016	(3)	Day & Date	(2)
Universal	12/31/2015	(4)	Delay	(1)

(1) Content licensed under the agreement is available for rental after a certain number of days following the retail release.

(2) Content licensed under the agreement is available for rental on the same day and date as the retail release.

(3) Agreement extends the term of the arrangement automatically for an additional year under certain conditions.

(4) Subsequent to year end, Redbox entered into an amendment to the existing agreement with Universal, extending the agreement through December 31, 2017. See Note 21: Subsequent Events for additional information.

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Schedule of Estimated Revenue Share Commitments to Retailers

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	December 31,
	Total		2016		2017		2018
Redbox	$	2,365	$	1,711	$	523	$	131

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Guarantor Subsidiaries (Tables)

12 Months Ended

Dec. 31, 2015

Condensed Financial Information of Parent Company Only Disclosure [Abstract]

Condensed Consolidating Balance Sheet

CONSOLIDATING BALANCE SHEETS
	As of December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries		Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	160,167		$	19,372	$	43,010	$	—		$	222,549
Accounts receivable, net of allowances	3,983			33,269		1,212		—			38,464
Content library	—			188,490		—		—			188,490
Prepaid expenses and other current assets	17,720			33,049		599		—			51,368
Intercompany receivables	35,654			527,996		426		(564,076		)	—
Total current assets	217,524			802,176		45,247		(564,076		)	500,871
Property and equipment, net	97,659			204,081		14,273		—			316,013
Deferred income taxes	—			—		2,606		—			2,606
Goodwill and other intangible assets, net	249,703			290,811		—		—			540,514
Other long-term assets	4,596			1,293		167		—			6,056
Investment in related parties	921,456			27,798		—		(949,254		)	—
Total assets	$	1,490,938		$	1,326,159	$	62,293	$	(1,513,330	)	$	1,366,060
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	16,127		$	167,694	$	189	$	—		$	184,010
Accrued payable to retailers	71,947			30,157		12,994		—			115,098
Other accrued liabilities	57,025			82,401		2,011		—			141,437
Current portion of long-term debt and other long-term liabilities	16,832			—		299		—			17,131
Intercompany payables	459,789			85,487		18,800		(564,076		)	—
Total current liabilities	621,720			365,739		34,293		(564,076		)	457,676
Long-term debt and other long-term liabilities	877,325			19,882		159		—			897,366
Deferred income taxes	13,965			19,083		44		—			33,092
Total liabilities	1,513,010			404,704		34,496		(564,076		)	1,388,134
Commitments and contingencies
Stockholders’ Equity:
Preferred stock	—			—		—		—			—
Common stock	599,675			252,727		4,636		(371,875		)	485,163
Treasury stock	(1,151,063		)	—		3,000		(3,000		)	(1,151,063		)
Retained earnings	530,140			668,728		18,963		(574,379		)	643,452
Accumulated other comprehensive income (loss)	(824		)	—		1,198		—			374
Total stockholders’ equity (deficit)	(22,072		)	921,455		27,797		(949,254		)	(22,074		)
Total liabilities and stockholders’ equity	$	1,490,938		$	1,326,159	$	62,293	$	(1,513,330	)	$	1,366,060

CONSOLIDATING BALANCE SHEETS
	As of December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Assets
Current Assets:
Cash and cash equivalents	$	180,889		$	17,939		$	43,868		$	—		$	242,696
Accounts receivable, net of allowances	3,203			43,874			1,513			—			48,590
Content library	—			176,490			3,631			—			180,121
Prepaid expenses and other current assets	14,884			23,923			1,012			—			39,819
Intercompany receivables	40,762			467,181			—			(507,943		)	—
Total current assets	239,738			729,407			50,024			(507,943		)	511,226
Property and equipment, net	133,923			263,412			31,133			—			428,468
Deferred income taxes	—			—			11,363			—			11,363
Goodwill and other intangible assets, net	249,717			374,281			—			—			623,998
Other long-term assets	6,665			1,231			335			—			8,231
Investment in related parties	917,234			(5,114		)	—			(912,120		)	—
Total assets	$	1,547,277		$	1,363,217		$	92,855		$	(1,420,063	)	$	1,583,286
Liabilities and Stockholders’ Equity
Current Liabilities:
Accounts payable	$	12,899		$	153,260		$	2,474		$	—		$	168,633
Accrued payable to retailers	69,189			42,977			14,124			—			126,290
Other accrued liabilities	59,770			74,536			2,820			—			137,126
Current portion of long-term debt and other long-term liabilities	20,020			—			396			—			20,416
Intercompany payables	309,932			121,015			76,996			(507,943		)	—
Total current liabilities	471,810			391,788			96,810			(507,943		)	452,465
Long-term debt and other long-term liabilities	949,588			22,946			1,135			—			973,669
Deferred income taxes	28,500			31,249			25			—			59,774
Total liabilities	1,449,898			445,983			97,970			(507,943		)	1,485,908
Commitments and contingencies
Stockholders’ Equity:
Common stock	588,105			225,729			12,393			(352,635		)	473,592
Treasury stock	(996,293		)	—			—			—			(996,293		)
Retained earnings	506,360			691,505			(17,991		)	(559,485		)	620,389
Accumulated other comprehensive income (loss)	(793		)	—			483			—			(310		)
Total stockholders’ equity	97,379			917,234			(5,115		)	(912,120		)	97,378
Total liabilities and stockholders’ equity	$	1,547,277		$	1,363,217		$	92,855		$	(1,420,063	)	$	1,583,286

Condensed Consolidating Statement of Comprehensive Income

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	271,430		$	1,874,457		$	47,324		$	—		$	2,193,211
Expenses:
Direct operating	143,429			1,328,269			21,390			—			1,493,088
Marketing	6,485			28,916			273			—			35,674
Research and development	(83		)	7,281			—			—			7,198
General and administrative	47,699			142,012			682			—			190,393
Restructuring and related costs	2,926			24,227			—			—			27,153
Depreciation and other	32,643			134,522			4,225			—			171,390
Amortization of intangible assets	14			13,536			—			—			13,550
Goodwill impairment	—			85,890			—			—			85,890
Total expenses	233,113			1,764,653			26,570			—			2,024,336
Operating income	38,317			109,804			20,754			—			168,875
Other income (expense), net:
Loss from equity method investments, net	(800		)	—			—			—			(800		)
Interest income (expense)	30,177			(72,164		)	(366		)	—			(42,353		)
Other, net	15,273			1,354			(19,284		)	—			(2,657		)
Total other income (expense), net	44,650			(70,810		)	(19,650		)	—			(45,810		)
Income from continuing operations before income taxes	82,967			38,994			1,104			—			123,065
Income tax expense	(31,603		)	(41,785		)	(231		)	—			(73,619		)
Income (loss) from continuing operations	51,364			(2,791		)	873			—			49,446
Income (loss) from discontinued operations, net of tax	640			(28,068		)	22,319			—			(5,109		)
Equity in income (loss) of subsidiaries	(7,667		)	23,192			—			(15,525		)	—
Net income (loss)	44,337			(7,667		)	23,192			(15,525		)	44,337
Foreign currency translation adjustment(1)	(31		)	—			715			—			684
Comprehensive income (loss)	$	44,306		$	(7,667	)	$	23,907		$	(15,525	)	$	45,021

(1) Foreign currency translation adjustment had no tax effect in 2015.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	266,848		$	1,975,905		$	48,833		$	—		$	2,291,586
Expenses:
Direct operating	142,472			1,415,132			23,707			—			1,581,311
Marketing	7,227			27,631			435			—			35,293
Research and development	3,456			9,591			—			—			13,047
General and administrative	39,412			150,211			873			—			190,496
Restructuring and related costs	23			534			—			—			557
Depreciation and other	35,155			148,217			4,452			—			187,824
Amortization of intangible assets	1,433			13,221			—			—			14,654
Total expenses	229,178			1,764,537			29,467			—			2,023,182
Operating income	37,670			211,368			19,366			—			268,404
Other income (expense), net:
Loss from equity method investments, net	(530		)	(28,204		)	—			—			(28,734		)
Interest income (expense), net	(48,007		)	572			(209		)	—			(47,644		)
Other, net	14,077			1,334			(16,596		)	—			(1,185		)
Total other income (expense), net	(34,460		)	(26,298		)	(16,805		)	—			(77,563		)
Income from continuing operations before income taxes	3,210			185,070			2,561			—			190,841
Income tax expense	(618		)	(64,989		)	(557		)	—			(66,164		)
Income from continuing operations	2,592			120,081			2,004			—			124,677
Loss from discontinued operations, net of tax	(803		)	(874		)	(16,382		)	—			(18,059		)
Equity in income (loss) of subsidiaries	104,829			(14,378		)	—			(90,451		)	—
Net income (loss)	106,618			104,829			(14,378		)	(90,451		)	106,618
Foreign currency translation adjustment(1)	368			—			89			—			457
Comprehensive income (loss)	$	106,986		$	104,829		$	(14,289	)	$	(90,451	)	$	107,075

(1) Foreign currency translation adjustment had no tax effect in 2014.

CONSOLIDATING STATEMENTS OF COMPREHENSIVE INCOME
	Year Ended December 31, 2013
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Revenue	$	255,251		$	1,999,539		$	44,995		$	—		$	2,299,785
Expenses:
Direct operating	138,859			1,394,932			36,155			(12,947		)	1,556,999
Marketing	6,540			23,269			418			—			30,227
Research and development	8,973			4,111			(2		)	—			13,082
General and administrative	33,023			169,099			721			12,955			215,798
Restructuring and related costs	724			3,771			—			—			4,495
Depreciation and other	28,101			157,292			4,008			—			189,401
Amortization of intangible assets	2,245			8,662			—			—			10,907
Total expenses	218,465			1,761,136			41,300			8			2,020,909
Operating income (loss)	36,786			238,403			3,695			(8		)	278,876
Other income (expense), net:
Income (loss) from equity method investments, net	65,063			(45,135		)	—			—			19,928
Interest income (expense), net	(32,930		)	257			(134		)	—			(32,807		)
Other, net	(3,868		)	479			(218		)	8			(3,599		)
Total other income (expense), net	28,265			(44,399		)	(352		)	8			(16,478		)
Income from continuing operations before income taxes	65,051			194,004			3,343			—			262,398
Income tax benefit (expense)	30,893			(70,577		)	(26		)	—			(39,710		)
Income from continuing operations	95,944			123,427			3,317			—			222,688
Loss from discontinued operations, net of tax	(30,834		)	(2,708		)	(14,354		)	—			(47,896		)
Equity in income (loss) of subsidiaries	109,682			(11,037		)	—			(98,645		)	—
Net income (loss)	174,792			109,682			(11,037		)	(98,645		)	174,792
Foreign currency translation adjustment(1)	(105		)	—			961			—			856
Comprehensive income (loss)	$	174,687		$	109,682		$	(10,076	)	$	(98,645	)	$	175,648

(1) Foreign currency translation adjustment had no tax effect in 2013.

Condensed Consolidating Statement of Cash Flows

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2015
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	44,337		$	(7,667	)	$	23,192		$	(15,525	)	$	44,337
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	32,643			136,367			8,237			—			177,247
Amortization of intangible assets	14			13,536			44			—			13,594
Share-based payments expense	10,323			6,917			—			—			17,240
Windfall excess tax benefits related to share-based payments	(739		)	—			—			—			(739		)
Deferred income taxes	(14,533		)	(12,730		)	7,644			—			(19,619		)
Restructuring, impairment and related costs	509			1,545			—			—			2,054
Loss from equity method investments, net	800			—			—			—			800
Amortization of deferred financing fees and debt discount	2,761			—			—			—			2,761
Gain from early extinguishment of debt	(5,854		)	—			—			—			(5,854		)
Gain on purchase of Gazelle	—			(989		)	—			—			(989		)
Goodwill impairment	—			85,890			—			—			85,890
Other	(539		)	295			(728		)	—			(972		)
Equity in loss (income) of subsidiaries	7,667			(23,192		)	—			15,525			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(781		)	10,673			119			—			10,011
Content library	—			(11,951		)	3,631			—			(8,320		)
Prepaid expenses and other current assets	(2,826		)	(7,599		)	360			—			(10,065		)
Other assets	66			(62		)	158			—			162
Accounts payable	(1,316		)	21,447			(2,188		)	—			17,943
Accrued payable to retailers	2,758			(12,820		)	94			—			(9,968		)
Other accrued liabilities	(391		)	11,337			(374		)	—			10,572
Net cash flows from operating activities(1)	74,899			210,997			40,189			—			326,085
Investing Activities:
Purchases of property and equipment	(26,861		)	(49,071		)	(1,659		)	—			(77,591		)
Proceeds from sale of property and equipment	17			3,208			—			—			3,225
Acquisitions, net of cash acquired	—			(17,980		)	—			—			(17,980		)
Investments in and advances to affiliates	187,538			(145,721		)	(41,817		)	—			—
Net cash flows from (used in) investing activities(1)	160,694			(209,564		)	(43,476		)	—			(92,346		)
Financing Activities:
Proceeds from new borrowing of Credit Facility	310,500			—			—			—			310,500
Principal payments on Credit Facility	(339,375		)	—			—			—			(339,375		)
Repurchases of common stock	(159,800		)	—			—			—			(159,800		)
Repurchase of Notes	(34,589		)	—			—			—			(34,589		)
Dividends paid	(21,210		)	—			—			—			(21,210		)
Principal payments on capital lease obligations and other debt	(11,110		)	—			(400		)	—			(11,510		)
Financing costs associated with Credit Facility and senior unsecured notes	(9		)	—			—			—			(9		)
Windfall excess tax benefits related to share-based payments	739			—			—			—			739
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(1,461		)	—			—			—			(1,461		)
Net cash flows used in financing activities(1)	(256,315		)	—			(400		)	—			(256,715		)

	Year Ended December 31, 2015
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	—			—		2,829			—		2,829
Increase (decrease) in cash and cash equivalents	(20,722		)	1,433		(858		)	—		(20,147		)
Cash and cash equivalents:
Beginning of period	180,889			17,939		43,868			—		242,696
End of period	$	160,167		$	19,372	$	43,010		$	—	$	222,549

(1) During 2015 we discontinued our Redbox operations in Canada. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operationsfor cash flow disclosures related to our discontinued Redbox operations in Canada.

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2014
(in thousands)	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	106,618		$	104,829		$	(14,378	)	$	(90,451	)	$	106,618
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	35,139			150,904			9,119			—			195,162
Amortization of intangible assets	1,433			13,259			—			—			14,692
Share-based payments expense	9,693			3,691			—			—			13,384
Windfall excess tax benefits related to share-based payments	(1,964		)	—			—			—			(1,964		)
Deferred income taxes	304			(17,232		)	(5,683		)	—			(22,611		)
Loss from equity method investments, net	530			28,204			—			—			28,734
Amortization of deferred financing fees and debt discount	4,116			—			—			—			4,116
Loss from early extinguishment of debt	2,018			—			—			—			2,018
Other	(1,250		)	(548		)	48			—			(1,750		)
Equity in loss (income) of subsidiaries	(104,829		)	14,378			—			90,451			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(1,130		)	8,787			1,014			—			8,671
Content library	36			20,206			(495		)	—			19,747
Prepaid expenses and other current assets	40,826			3,753			(297		)	—			44,282
Other assets	75			1,558			69			—			1,702
Accounts payable	(3,017		)	(65,737		)	(158		)	—			(68,912		)
Accrued payable to retailers	(1,896		)	(5,149		)	198			—			(6,847		)
Other accrued liabilities	(840		)	1,988			161			—			1,309
Net cash flows from (used in) operating activities(1)	85,862			262,891			(10,402		)	—			338,351
Investing Activities:
Purchases of property and equipment	(33,602		)	(57,909		)	(6,413		)	—			(97,924		)
Proceeds from sale of property and equipment	750			1,227			—			—			1,977
Cash paid for equity investments	—			(24,500		)	—			—			(24,500		)
Extinguishment payment received from equity investment	—			5,000			—			—			5,000
Investments in and advances to affiliates	166,145			(178,406		)	12,261			—			—
Net cash flows from (used in) investing activities(1)	133,293			(254,588		)	5,848			—			(115,447		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	295,500			—			—			—			295,500
Proceeds from new borrowing of Credit Facility	642,000			—			—			—			642,000
Principal payments on Credit Facility	(680,125		)	—			—			—			(680,125		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,911		)	—			—			—			(2,911		)
Settlement and conversion of convertible debt	(51,149		)	—			—			—			(51,149		)
Repurchases of common stock	(545,091		)	—			—			—			(545,091		)
Principal payments on capital lease obligations and other debt	(13,552		)	(3		)	(441		)	—			(13,996		)
Windfall excess tax benefits related to share-based payments	1,964			—			—			—			1,964
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	(520		)	—			—			—			(520		)
Net cash flows from (used in) financing activities(1)	(353,884		)	(3		)	(441		)	—			(354,328		)

	Year Ended December 31, 2014
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications		Total
Effect of exchange rate changes on cash	368			—		2,315			—		2,683
Increase (decrease) in cash and cash equivalents	(134,361		)	8,300		(2,680		)	—		(128,741		)
Cash and cash equivalents:
Beginning of period	315,250			9,639		46,548			—		371,437
End of period	$	180,889		$	17,939	$	43,868		$	—	$	242,696

(1) During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

CONSOLIDATING STATEMENTS OF CASH FLOWS
	Year Ended December 31, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries			Combined Non-Guarantor Subsidiaries			Eliminations and Consolidation Reclassifications			Total
Operating Activities:
Net income (loss)	$	174,792		$	109,682		$	(11,037	)	$	(98,645	)	$	174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other	29,640			158,801			5,259			—			193,700
Amortization of intangible assets	2,245			8,688			—			—			10,933
Share-based payments expense	9,903			6,928			—			—			16,831
Windfall excess tax benefits related to share-based payments	(3,698		)	—			—			—			(3,698		)
Deferred income taxes	9,228			(15,727		)	(4,434		)	—			(10,933		)
Restructuring, impairment and related costs	32,444			288			—			—			32,732
Loss (income) from equity method investments, net	(65,063		)	45,135			—			—			(19,928		)
Amortization of deferred financing fees and debt discount	6,394			—			—			—			6,394
Loss from early extinguishment of debt	6,013			—			—			—			6,013
Other	827			(2,951		)	31			54			(2,039		)
Equity in (income) losses of subsidiaries	(109,682		)	11,037			—			98,645			—
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net	(1,144		)	10,639			(1,517		)	—			7,978
Content library	1,093			(23,357		)	(195		)	—			(22,459		)
Prepaid expenses and other current assets	(43,762		)	(6,280		)	(500		)	—			(50,542		)
Other assets	201			400			(371		)	—			230
Accounts payable	1,319			(408		)	226			354			1,491
Accrued payable to retailers	(6,181		)	1,633			460			—			(4,088		)
Other accrued liabilities	13,184			(22,751		)	(6		)	—			(9,573		)
Net cash flows from (used in) operating activities(1)	57,753			281,757			(12,084		)	408			327,834
Investing Activities:
Purchases of property and equipment	(58,763		)	(88,431		)	(14,218		)	—			(161,412		)
Proceeds from sale of property and equipment	12,147			1,189			8			—			13,344
Acquisition of ecoATM, net of cash acquired	(244,036		)	—			—			—			(244,036		)
Receipt of note receivable principal	22,913			—			—			—			22,913
Cash paid for equity investments	—			(28,000		)	—			—			(28,000		)
Investments in and advances to affiliates	125,856			(156,659		)	30,857			(54		)	—
Net cash flows from (used in) investing activities(1)	(141,883		)	(271,901		)	16,647			(54		)	(397,191		)
Financing Activities:
Proceeds from issuance of senior unsecured notes	343,769			—			—			—			343,769
Proceeds from new borrowing of Credit Facility	400,000			—			—			—			400,000
Principal payments on Credit Facility	(215,313		)	—			—			—			(215,313		)
Financing costs associated with Credit Facility and senior unsecured notes	(2,203		)	—			—			—			(2,203		)
Conversion of convertible debt	(172,211		)	—			—			—			(172,211		)
Repurchases of common stock	(195,004		)	—			—			—			(195,004		)
Principal payments on capital lease obligations and other debt	(14,200		)	(217		)	(417		)	—			(14,834		)
Windfall excess tax benefits related to share-based payments	3,698			—			—			—			3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options	8,460			—			—			—			8,460
Net cash flows from (used in) financing activities(1)	156,996			(217		)	(417		)	—			156,362

	Year Ended December 31, 2013
	Outerwall Inc.			Combined Guarantor Subsidiaries		Combined Non-Guarantor Subsidiaries		Eliminations and Consolidation Reclassifications			Total
Effect of exchange rate changes on cash	(105		)	—		1,643		—			1,538
Increase (decrease) in cash and cash equivalents	72,761			9,639		5,789		354			88,543
Cash and cash equivalents:
Beginning of period	242,489			—		40,759		(354		)	282,894
End of period	$	315,250		$	9,639	$	46,548	$	—		$	371,437

(1) During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

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Income Taxes from Continuing Operations (Tables)

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Abstract]

Income before Income Tax, Domestic and Foreign

The components of income from continuing operations before income taxes were as follows:

	Year Ended December 31,
Dollars in thousands	2015		2014		2013
U.S. operations	$	121,940	$	188,473	$	259,057
Foreign operations	1,125		2,368		3,341
Total income from continuing operations before income taxes	$	123,065	$	190,841	$	262,398

Components of Income Tax Expense

The components of income tax expense from continuing operations were as follows:

	Year Ended December 31,
Dollars in thousands	2015			2014			2013
Current:
U.S. Federal	$	89,996		$	69,117		$	38,876
State and local	10,658			12,294			10,104
Foreign	469			415			(424		)
Total current	101,123			81,826			48,556
Deferred:
U.S. Federal	(27,641		)	(16,232		)	(3,642		)
State and local	380			427			(5,653		)
Foreign	(243		)	143			449
Total deferred	(27,504		)	(15,662		)	(8,846		)
Total income tax expense	$	73,619		$	66,164		$	39,710

Effective Income Tax Rate Reconciliation

Rate Reconciliation

The income tax expense differs from the amount that would result by applying the U.S. statutory rate to income before income taxes as follows:

	Year Ended December 31,
	2015		2014		2013
U.S Federal tax expense at statutory rates	35.0	%	35.0	%	35.0	%
State income taxes, net of federal benefit	5.8		4.1		3.9
Federal and state credits	(1.6	)	(1.1	)	(0.9	)
Domestic production activities deduction	(4.9	)	(3.6	)	(0.6	)
Goodwill Impairment	24.4		—		—
Recognition of outside basis differences	—		(1.1	)	(15.4	)
ecoATM option payments	0.2		1.4		0.7
Valuation allowance	0.2		—		2.3
Acquisition of ecoATM	—		—		(9.3	)
Other	0.7		—		(0.6	)
Effective tax rate	59.8	%	34.7	%	15.1	%

Summary of Unrecognized Tax Benefits

The aggregate changes in the balance of unrecognized tax benefits were as follows:

Dollars in thousands	Year Ended December 31,
	2015			2014			2013
Balance, beginning of the year	$	4,639		$	2,781		$	2,383
Additions based on tax positions related to the current year	1,837			1,836			824
Additions for tax positions related to prior years	527			806			18
Reductions for tax positions related to prior years	(118		)	—			(257		)
Reductions from lapse of applicable statute of limitations	—			(784		)	(49		)
Settlements	—			—			(138		)
Balance, end of year	$	6,885		$	4,639		$	2,781

Summary of Deferred Tax Assets and Liabilities

Significant components of our deferred tax assets and liabilities and the net increase (decrease) in the valuation allowance were as follows:

Dollars in thousands	December 31,
	2015			2014
Deferred tax assets:
Income tax loss carryforwards	$	3,015		$	5,690
Capital loss carryforwards	4,759			5,930
Credit carryforwards	3,482			2,929
Accrued liabilities and allowances	27,188			22,652
Stock-based compensation	9,065			11,901
Intangible assets	13,109			17,166
Other	5,720			3,776
Gross deferred tax assets	66,338			70,044
Less: Valuation Allowance	(7,141		)	(6,898		)
Total deferred tax assets	59,197			63,146
Deferred tax liabilities:
Property and equipment	(42,984		)	(68,417		)
Product costs	(46,699		)	(43,140		)
Total deferred tax liabilities	(89,683		)	(111,557		)
Net deferred tax liabilities	$	(30,486	)	$	(48,411	)

Change in Valuation Allowance

Change in Valuation Allowance

Dollars in thousands	Year Ended December 31,
	2015		2014		2013
Increase in valuation allowance	$	243	$	—	$	6,898

Summary of Operating Loss Carryforwards

Our deferred tax assets relating to income tax loss carryforwards and expiration periods are summarized as follows: 

Dollars in thousands	December 31, 2015
	Federal		State		Foreign
Net operating loss carryforwards	$	23	$	24,570	$	7,082
Deferred tax assets related to net operating loss carryforwards	$	8	$	1,118	$	1,889
Years that net operating loss carryforwards will expire between	2029-2034		2017-2033		2033-2035

Summary of Tax Credit Carryforwards

U.S. State Tax Credits and Expiration Periods

The following table shows our U.S. state tax credits before valuation allowances and related expiration periods.

Dollars in thousands	December 31, 2015
	Amount		Expiration
U.S state tax credits:
Illinois state tax credits	$	2,894	2017-2021
California U.S. state tax credits	588		Do not expire
Total U.S. state tax credits	$	3,482

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Organization and Business (Details) $ in Thousands	Jul. 23, 2013 USD ($)	Dec. 31, 2015 USD ($) Kiosk Locations	Nov. 10, 2015 USD ($)	Dec. 31, 2014 USD ($)
Property, plant, and equipment			$ 252
Goodwill		$ 473,417		$ 559,307
Kiosks | Kiosk		63,780
Locations | Locations		54,860
Redbox
Goodwill		$ 138,743		138,743
Kiosks | Kiosk		40,480
Locations | Locations		33,060
Coinstar
Goodwill		$ 156,351		156,351
Kiosks | Kiosk		20,930
Locations | Locations		19,660
ecoATM
Goodwill		$ 178,323		$ 264,213
Kiosks | Kiosk		2,250
Locations | Locations		2,020
All Other
Kiosks | Kiosk		120
Locations | Locations		120
ecoATM
Percentage of voting interests acquired	77.00%
Payments to acquire ecoATM	$ 262,900
Property, plant, and equipment	23,200
Intangible assets	41,400
Goodwill	$ 264,200

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Summary of Significant Accounting Policies (Property, Plant and Equipment, Useful Life) (Details)	12 Months Ended
	Dec. 31, 2015
Coin Counting Kiosks [Member] | Minimum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	2 years
Coin Counting Kiosks [Member] | Maximum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	10 years
Redbox Kiosks [Member] | Minimum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	3 years
Redbox Kiosks [Member] | Maximum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	5 years
ecoATM Kiosks [Member] [Member]
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	5 years
Computers, servers, and software | Minimum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	3 years
Computers, servers, and software | Maximum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	5 years
Office Equipment [Member] | Minimum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	5 years
Office Equipment [Member] | Maximum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	7 years
Leased Vehicles [Member] | Minimum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	3 years
Leased Vehicles [Member] | Maximum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	6 years
Leasehold improvements | Minimum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	1 year
Leasehold improvements | Maximum
Property, Plant and Equipment [Line Items]
Property, Plant and Equipment, Useful Life	11 years

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Summary of Significant Accounting Policies (Change To Two Class Method) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		12 Months Ended
		Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Change To Two Class Method [Line Items]
Income from continuing operations used in basic per share calculation		$ 48,117	$ 120,748	$ 217,215
Income from continuing operations used in diluted per share calculation		$ 48,118	$ 120,806	$ 217,394
Weighted average shares used for basic EPS (in shares)		17,467	20,192	27,216
Weighted average shares used for diluted EPS (in shares)	[1]	17,487	20,503	28,169
Basic earnings per common share from continuing operations (in usd per share)		$ 2.75	$ 5.98	$ 7.98
Diluted earnings per common share from continuing operations (in usd per share)		$ 2.75	$ 5.89	$ 7.72
Scenario, Previously Reported [Member]
Change To Two Class Method [Line Items]
Income from continuing operations used in basic per share calculation			$ 124,677	$ 222,688
Income from continuing operations used in diluted per share calculation			$ 124,677	$ 222,688
Weighted average shares used for basic EPS (in shares)			20,192	27,216
Weighted average shares used for diluted EPS (in shares)			20,699	28,381
Basic earnings per common share from continuing operations (in usd per share)			$ 6.17	$ 8.18
Diluted earnings per common share from continuing operations (in usd per share)			$ 6.02	$ 7.85
Restatement Adjustment [Member]
Change To Two Class Method [Line Items]
Income from continuing operations used in basic per share calculation			$ (3,929)	$ (5,473)
Income from continuing operations used in diluted per share calculation			$ (3,871)	$ (5,294)
Weighted average shares used for basic EPS (in shares)			0	0
Weighted average shares used for diluted EPS (in shares)			(196)	(212)
Basic earnings per common share from continuing operations (in usd per share)			$ (0.19)	$ (0.20)
Diluted earnings per common share from continuing operations (in usd per share)			$ (0.13)	$ (0.13)

[1] Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive than the calculation using the treasury stock method.

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Summary of Significant Accounting Policies (New Accounting Pronouncement, Early Adoption) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
New Accounting Pronouncement, Early Adoption [Line Items]
Prepaid expenses and other current assets	$ 51,368	$ 39,819
Deferred income taxes assets - long term	2,606	11,363
Deferred income taxes liabilities - current		0
Deferred income taxes liabilities - long term	$ 33,092	59,774
Scenario, Previously Reported [Member]
New Accounting Pronouncement, Early Adoption [Line Items]
Prepaid expenses and other current assets		39,837
Deferred income taxes assets - long term		11,378
Deferred income taxes liabilities - current		21,432
Deferred income taxes liabilities - long term		38,375
Restatement Adjustment [Member]
New Accounting Pronouncement, Early Adoption [Line Items]
Prepaid expenses and other current assets		(18)
Deferred income taxes assets - long term		(15)
Deferred income taxes liabilities - current		(21,432)
Deferred income taxes liabilities - long term		$ 21,399

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Summary of Significant Accounting Policies (Narrative) (Details)		3 Months Ended	12 Months Ended
		Jun. 30, 2013 USD ($)	Dec. 31, 2015 USD ($) $ / shares	Dec. 31, 2014 USD ($) note $ / shares shares	Dec. 31, 2013 USD ($) $ / shares shares	Sep. 02, 2014 USD ($)	Dec. 31, 2012 USD ($)
Cash and cash equivalents			$ 222,549,000	$ 242,696,000	$ 371,437,000		$ 282,894,000
Cash equivalents			2,700,000	900,000
Cash identified for settling accrued payable to retailer partners			83,300,000	81,700,000
Direct operating benefit	[1]		$ (1,493,088,000)	$ (1,581,311,000)	$ (1,556,999,000)
Content library, period of amortization			1 year
Earnings per share, basic | $ / shares			$ 2.46	$ 5.09	$ 6.22
Earnings per share, diluted | $ / shares			$ 2.46	$ 5.01	$ 6.02
Debt instrument, face amount						$ 200,000,000
Repayments of convertible debt			$ 0	$ 51,149,000	$ 172,211,000
Loss on extinguishment of debt			(5,854,000)	2,018,000	6,013,000
Advertising expense			15,200,000	11,800,000	11,700,000
Unamortized deferred financing fees	[2]		3,849,000	$ 4,986,000
Long-term assets
Unamortized deferred financing fees	[2]		3,849,000
Change in Accounting Method Accounted for as Change in Estimate
Direct operating benefit		$ 21,700,000			$ 31,800,000
Earnings per share, basic | $ / shares					$ 1.17
Earnings per share, diluted | $ / shares					$ 1.12
Convertible Notes
Interest rate, per year						4.00%
Number of convertible senior note repurchased | note				51,148
Repayments of convertible debt				$ 51,100,000
Loss on extinguishment of debt				$ 300,000
Common Stock
Conversion of callable convertible debt, net of tax (in shares) | shares				431,760	272,336
UNITED STATES
Cash and cash equivalents held in financial institutions			46,200,000	$ 66,500,000
Foreign
Cash and cash equivalents held in financial institutions			9,000,000	11,600,000
Play Pass
Deferred revenue			$ 2,500,000	$ 1,500,000

[1] “Direct operating” excludes depreciation and other of $118.7 million, $125.7 million and $129.1 million for 2015, 2014 and 2013, respectively.

[2] Deferred financing fees are recorded in other long-term assets in our Consolidated Balance Sheets and are amortized on a straight line basis over the life of the related loan.

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Business Combinations (Schedule of Recognized Identified Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands		12 Months Ended
	Nov. 10, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Business Combinations [Abstract]
Total consideration transferred	$ 17,980
Assets acquired:
Accounts receivable	67
Prepaid expenses and other current assets	3,963
Property and equipment	252
Intangible assets	16,000
Total assets acquired	20,282
Liabilities assumed:
Deferred revenue	(750)
Deferred tax liabilities	(563)
Total liabilities assumed	(1,313)
Total net assets acquired	18,969
Bargain purchase gain	$ 989	$ 989	$ 0	$ 0

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Business Combinations (Business Combination, Intangible Assets) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Nov. 10, 2015
Business Acquisition [Line Items]
Purchase Price		$ 16,000
Trade names
Business Acquisition [Line Items]
Purchase Price	$ 14,000
Estimated Useful Life in Years	10 years
Developed technology
Business Acquisition [Line Items]
Purchase Price	$ 2,000
Estimated Useful Life in Years	3 years

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Business Combinations (Revenue and Operating Loss from the Acquisition) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Business Combinations [Abstract]
Revenue	$ 13,269
Operating loss	$ 948

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Business Combinations (Pro forma Information) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Business Combinations [Abstract]
Pro-forma revenue	$ 2,264,467	$ 2,378,508
Pro-forma income from continuing operations	$ 38,524	$ 114,641

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Business Combinations (Narrative) (Details) - USD ($) $ in Thousands			3 Months Ended	12 Months Ended
	Nov. 10, 2015	Oct. 29, 2015	Dec. 31, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Business Acquisition [Line Items]
Business acquisition, date of acquisition agreement		Oct. 29, 2015
Business acquisition, name of acquired entity				Gazelle, Inc.
Business acquisition, effective date of acquisition	Nov. 10, 2015
Bargain purchase gain	$ 989			$ 989	$ 0	$ 0
Business combination, income tax rate used for pro forma				5.80%	4.10%	3.90%
Gazelle Inc.
Business Acquisition [Line Items]
Business combination, income tax rate used for pro forma				37.50%
General and administrative expense
Business Acquisition [Line Items]
Business combination, acquisition related costs			$ 300

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Prepaid Expenses and Other Current Assets and Other Accrued Liabilities (Schedule of Prepaid Expenses and Other Current Assets) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Prepaid Expenses and Other Current Assets and Other Accrued Liabilities [Abstract]
Spare parts	$ 9,780	$ 13,643
Licenses	6,394	5,881
Electronic devices inventory	7,846	5,259
Income taxes receivable	9,517	95
Prepaid rent	1,043	1,446
DVD cases and labels	1,371	1,330
Other	15,417	12,165
Total prepaid and other current assets	$ 51,368	$ 39,819

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Prepaid Expenses and Other Current Assets and Other Accrued Liabilities (Schedule of Other Accrued Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Prepaid Expenses and Other Current Assets and Other Accrued Liabilities [Abstract]
Payroll related expenses	$ 40,676	$ 33,343
Studio revenue share and other content related expenses	28,964	23,226
Business taxes	16,080	21,629
Insurance	13,594	9,615
Deferred revenue	11,201	6,995
Income taxes payable	16	9,463
Accrued interest expense	6,913	6,974
Accrued early lease termination and sublease expenses	4,991	0
Service contract provider expenses	4,070	4,191
Deferred rent expense	1,728	6,162
Other	13,204	15,528
Total other accrued liabilities	$ 141,437	$ 137,126

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Property and Equipment (Schedule of Property and Equipment) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Property, Plant and Equipment [Line Items]
Property and equipment, at cost	$ 1,391,545	$ 1,411,917
Accumulated depreciation and amortization	(1,075,532)	(983,449)
Property and equipment, net	316,013	428,468
Kiosks and components
Property, Plant and Equipment [Line Items]
Property and equipment, at cost	1,163,210	1,165,925
Computers, servers, and software
Property, Plant and Equipment [Line Items]
Property and equipment, at cost	193,507	200,915
Leasehold improvements
Property, Plant and Equipment [Line Items]
Property and equipment, at cost	22,663	29,625
Office furniture and equipment
Property, Plant and Equipment [Line Items]
Property and equipment, at cost	7,047	9,218
Vehicles
Property, Plant and Equipment [Line Items]
Property and equipment, at cost	$ 5,118	$ 6,234

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Property and Equipment (Narrative) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2013
Property, Plant and Equipment [Abstract]
Accelerated depreciation related to SAMPLEit	$ 5,000
Impairment of lease related assets	$ 7,440	$ 32,732

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Goodwill and Other Intangible Assets Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill impairment (Note 6)	$ 85,900	$ 85,890	$ 0	$ 0

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Goodwill and Other Intangible Assets (Goodwill) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 559,307
Accumulated impairment losses	(85,890)
Net goodwill	$ 473,417	$ 559,307

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Goodwill and Other Intangible Assets (Goodwill by Segment) (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Jun. 30, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Goodwill [Roll Forward]
Goodwill, beginning balance		$ 559,307
Goodwill Impairment	$ (85,900)	(85,890)	$ 0	$ 0
Goodwill, ending balance		473,417	559,307
Redbox
Goodwill [Roll Forward]
Goodwill, beginning balance		138,743
Goodwill Impairment		0
Goodwill, ending balance		138,743	138,743
Coinstar
Goodwill [Roll Forward]
Goodwill, beginning balance		156,351
Goodwill Impairment		0
Goodwill, ending balance		156,351	156,351
ecoATM
Goodwill [Roll Forward]
Goodwill, beginning balance		264,213
Goodwill Impairment		(85,890)
Goodwill, ending balance		$ 178,323	$ 264,213

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Goodwill and Other Intangible Assets (Gross Amount Of Other Intangible Assets And The Related Accumulated Amortization) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Intangible assets, net	$ 67,097	$ 64,691
Retailer relationships
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	53,295	53,295
Intangible assets, accumulated amortization	(27,212)	(23,200)
Intangible assets, net	$ 26,083	30,095
Retailer relationships | Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	5 years
Retailer relationships | Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	10 years
Developed technology
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 36,000	34,000
Intangible assets, accumulated amortization	(16,544)	(9,633)
Intangible assets, net	$ 19,456	24,367
Developed technology | Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	3 years
Developed technology | Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	5 years
Trade names
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 20,000	6,000
Intangible assets, accumulated amortization	(3,133)	(1,700)
Intangible assets, net	$ 16,867	4,300
Trade names | Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	5 years
Trade names | Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	10 years
Other intangible assets
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 10,800	10,800
Intangible assets, accumulated amortization	(6,109)	(4,871)
Intangible assets, net	$ 4,691	$ 5,929
Other intangible assets | Minimum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	1 year
Other intangible assets | Maximum
Finite-Lived Intangible Assets [Line Items]
Amortization Period	40 years

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Goodwill and Other Intangible Assets (Amortization Expenses) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets including discontinued operations	$ 13,594	$ 14,692	$ 10,933
Less: amortization included in discontinued operations	(44)	(38)	(26)
Amortization of intangible assets	13,550	14,654	10,907
Retailer relationships
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets including discontinued operations	4,012	5,432	6,250
Developed technology
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets including discontinued operations	6,911	6,800	2,833
Trade names
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets including discontinued operations	1,433	1,200	500
Other intangible assets
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets including discontinued operations	$ 1,238	$ 1,260	$ 1,350

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Goodwill and Other Intangible Assets (Expected Future Amortization) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Finite-Lived Intangible Assets [Line Items]
2016	$ 15,160
2017	15,160
2018	11,598
2019	6,213
2020	5,819
Thereafter	13,147
Intangible assets, net	67,097	$ 64,691
Retailer relationships
Finite-Lived Intangible Assets [Line Items]
2016	4,012
2017	4,012
2018	4,012
2019	4,012
2020	4,012
Thereafter	6,023
Intangible assets, net	26,083	30,095
Developed technology
Finite-Lived Intangible Assets [Line Items]
2016	7,467
2017	7,467
2018	4,522
2019	0
2020	0
Thereafter	0
Intangible assets, net	19,456	24,367
Trade names
Finite-Lived Intangible Assets [Line Items]
2016	2,600
2017	2,600
2018	2,100
2019	1,400
2020	1,400
Thereafter	6,767
Intangible assets, net	16,867	4,300
Other intangible assets
Finite-Lived Intangible Assets [Line Items]
2016	1,081
2017	1,081
2018	964
2019	801
2020	407
Thereafter	357
Intangible assets, net	$ 4,691	$ 5,929

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Equity Method Investments (Capital Contributions) (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended			36 Months Ended
	Feb. 29, 2012	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2014
Redbox Instant By Verizon
Schedule of Equity Method Investments [Line Items]
Cash Contributions	$ 14,000	$ 24,500	$ 28,000	$ 24,500	$ 77,000

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Equity Method Investments (Equity Investments and Ownership Percentages) (Details) - USD ($) $ in Millions	Dec. 31, 2015	Feb. 29, 2012
Redbox Instant By Verizon
Schedule of Equity Method Investments [Line Items]
Ownership Percentage		35.00%
SoloHealth
Schedule of Equity Method Investments [Line Items]
Equity Method Investments	$ 0.7
Ownership Percentage	10.00%

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Equity Method Investments (Schedule of Income (Loss) From Equity Method Investments) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Schedule of Equity Method Investments [Line Items]
Gain on previously held equity interest on ecoATM	$ 0	$ 0	$ 68,376
Proportionate share of net loss of equity method investees:	(800)	(26,323)	(45,973)
Amortization of difference in carrying amount and underlying equity in Joint Venture	0	(2,411)	(2,475)
Total income (loss) from equity method investments	(800)	(28,734)	19,928
Redbox Instant By Verizon
Schedule of Equity Method Investments [Line Items]
Proportionate share of net loss of equity method investees:	0	(25,793)	(42,660)
Pursuant Health and ecoATM
Schedule of Equity Method Investments [Line Items]
Proportionate share of net loss of equity method investees:	$ (800)	$ (530)	$ (3,313)

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Equity Method Investments (Summarized Financial Information of Equity Method Investees) (Details) - USD ($) $ in Thousands		Dec. 31, 2015	Dec. 31, 2014
Equity Method Investments and Joint Ventures [Abstract]
Current assets	[1]	$ 3,457	$ 3,408
Noncurrent assets	[1]	13,394	20,376
Current liabilities	[1]	5,888	7,321
Long-term liabilities	[1]	$ 22,811	$ 18,754

[1] Represents Pursuant Health, Inc. only.Statement of OperationsYear Ended December 31,Dollars in thousands2015 2014 2013Revenue$7,389 $29,963 $15,824Cost of sales and service$10,129 $68,732 $25,092Net loss from continuing operations$6,107 $140,919 $134,911

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Equity Method Investments (Proportionate Share of Joint Venture Summarized Financial Information) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Equity Method Investments and Joint Ventures [Abstract]
Revenue	$ 7,389	$ 29,963	$ 15,824
Cost of sales and service	10,129	68,732	25,092
Net loss and loss from continuing operations	$ 6,107	$ 140,919	$ 134,911

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Equity Method Investments (Narrative) (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended				36 Months Ended
	Feb. 29, 2012	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2014
Schedule of Equity Method Investments [Line Items]
Total extinguishment payment			$ 16,800
Expense reimbursement payment			11,800
Extinguishment payment received from equity investment		$ 0	5,000	$ 0
Redbox Instant By Verizon
Schedule of Equity Method Investments [Line Items]
Ownership Percentage	35.00%
Payments to Acquire Interest in Joint Venture	$ 14,000		$ 24,500	$ 28,000	$ 24,500	$ 77,000
SoloHealth
Schedule of Equity Method Investments [Line Items]
Ownership Percentage		10.00%
Equity Method Investments		$ 700

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Debt and Other Long-Term Liabilities (Schedule Of Debt And Other Long-Term Liabilities) (Details) - USD ($) $ in Thousands		Dec. 31, 2015	Dec. 31, 2014
Debt
Principal		$ 886,283	$ 956,250
Discount		(6,564)	(8,783)
Total		879,719	947,467
Less: current portion		(13,125)	(9,390)
Total long-term portion		866,594	938,077
Other Liabilities
Capital Lease Obligations		5,889	15,391
Capital Lease Obligations, Current		(4,006)	(11,026)
Capital Lease Obligations, Noncurrent		1,883	4,365
Asset retirement obligations		9,412	13,576
Asset Retirement Obligation, Current		0	0
Asset Retirement Obligations, Noncurrent		9,412	13,576
Other long-term liabilities		19,477	17,651
Other Long-term Liabilities, Current		0	0
Other Long-term Liabilities, Noncurrent		19,477	17,651
Long Term Debt And Other Long Term Liabilities		914,497	994,085
Current portion of long-term debt and other long-term liabilities		(17,131)	(20,416)
Long-term debt and other long-term liabilities (Note 8)		897,366	973,669
Unamortized deferred financing fees	[1]	3,849	4,986
Senior Notes | Senior Unsecured Notes due 2019
Debt
Principal		350,000	350,000
Discount		(3,275)	(4,296)
Total		346,725	345,704
Less: current portion		0	0
Total long-term portion		346,725	345,704
Other Liabilities
Unamortized deferred financing fees	[1]	495	649
Senior Notes | 2021 Notes
Debt
Principal		258,908	300,000
Discount		(3,029)	(4,152)
Total		255,879	295,848
Less: current portion		0	0
Total long-term portion		255,879	295,848
Other Liabilities
Unamortized deferred financing fees	[1]	1,054	1,372
Credit Facility | Term Loans
Debt
Principal		136,875	146,250
Discount		(260)	(335)
Total		136,615	145,915
Less: current portion		(13,125)	(9,390)
Total long-term portion		123,490	136,525
Other Liabilities
Unamortized deferred financing fees	[1]	0	0
Credit Facility | Revolving Line of Credit
Debt
Principal		140,500	160,000
Discount		0	0
Total		140,500	160,000
Less: current portion		0	0
Total long-term portion		140,500	160,000
Other Liabilities
Unamortized deferred financing fees	[1]	$ 2,300	$ 2,965

[1] Deferred financing fees are recorded in other long-term assets in our Consolidated Balance Sheets and are amortized on a straight line basis over the life of the related loan.

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Debt and Other Long-Term Liabilities (Schedule Of Interest Expense) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Debt Disclosure [Abstract]
Cash interest expense	$ 45,507	$ 41,562	$ 25,289
Non-cash interest expense:
Amortization of debt discount	1,731	2,606	4,674
Amortization of deferred financing fees	1,030	1,510	1,720
Other	0	0	(550)
Total non-cash interest expense	2,761	4,116	5,844
Total cash and non-cash interest expense	48,268	45,678	31,133
(Gain) loss from early extinguishment of debt	(5,854)	2,018	6,013
Total interest expense	$ 42,414	$ 47,696	$ 37,146

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Debt and Other Long-Term Liabilities (Schedule of Maturities of Long-term Debt) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Line of Credit Facility [Line Items]
Total	$ 886,283	$ 956,250
Credit Facility | Term Loans
Line of Credit Facility [Line Items]
2016	13,125
2017	15,000
2018	18,750
2019	90,000
Total	$ 136,875	$ 146,250

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Debt and Other Long-Term Liabilities (Schedule of Other Long-Term Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Debt Disclosure [Abstract]
Tenant improvement and deferred rent and other	$ 12,592	$ 13,012
Unrecognized tax benefit	6,885	4,639	$ 2,781	$ 2,383
Total other long-term liabilities	$ 19,477	$ 17,651

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Debt and Other Long-Term Liabilities (Narrative) (Details)			12 Months Ended
	Jun. 09, 2014 USD ($)	Mar. 12, 2013 USD ($)	Dec. 31, 2015 USD ($) note	Dec. 31, 2014 USD ($) note shares	Dec. 31, 2013 USD ($) shares	Sep. 02, 2014 USD ($)
Debt Instrument [Line Items]
Principal amount of debt						$ 200,000,000
Proceeds from issuance of senior unsecured notes			$ 0	$ 295,500,000	$ 343,769,000
Gain (loss) from early extinguishment of debt			5,854,000	(2,018,000)	(6,013,000)
Conversion of debt, cash			$ 0	$ 51,149,000	$ 172,211,000
Senior Notes | Senior Unsecured Notes due 2019
Debt Instrument [Line Items]
Principal amount of debt		$ 350,000,000.0
Interest rate, per year		6.00%
Proceeds from issuance of senior unsecured notes		$ 343,800,000
Senior Notes | 2021 Notes
Debt Instrument [Line Items]
Principal amount of debt	$ 300,000,000.0
Interest rate, per year	5.875%
Proceeds from issuance of senior unsecured notes	$ 294,000,000
Debt Instrument, Repurchase Date			Dec. 15, 2015
Number of Senior Notes Repurchased | note			41,092
Debt Instrument, Repurchased Face Amount			$ 41,100,000
Debt Instrument, Repurchase Amount			34,600,000
Gain (loss) from early extinguishment of debt			$ 5,900,000
Credit Facility
Debt Instrument [Line Items]
Interest rate on amounts outstanding under the credit facility			2.29%	1.92%
Convertible Notes
Debt Instrument [Line Items]
Interest rate, per year						4.00%
Gain (loss) from early extinguishment of debt				$ (300,000)
Number of notes retired | note				51,148
Conversion of debt, cash				$ 51,100,000
Revolving Line of Credit | Credit Facility
Debt Instrument [Line Items]
Gain (loss) from early extinguishment of debt				$ (1,700,000)
Line of credit facility, maximum borrowing capacity			$ 600,000,000.0
Sublimit for issuance of letters of credit			75,000,000.0
Sublimit for swingline loans			50,000,000.0
Sublimit for loans in certain foreign countries			75,000,000.0
Line of credit facility, option to increase borrowing capacity			200,000,000.0
Term Loans | Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity			$ 150,000,000.0
Common Stock
Debt Instrument [Line Items]
Conversion of callable convertible debt, net of tax (in shares) | shares				431,760	272,336

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Repurchases of Common Stock (Narrative) (Details) - USD ($)	12 Months Ended
	Dec. 31, 2014	Feb. 03, 2015
Accelerated Share Repurchases [Line Items]
Additional repurchase program, authorized amount		$ 250,000,000
Tender Offer
Accelerated Share Repurchases [Line Items]
Professional fees paid	$ 3,700,000

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Repurchases of Common Stock (Stock Repurchase Program - 2015) (Details) - USD ($)	12 Months Ended			36 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2015	Feb. 03, 2015
Summary Of Authorized Stock Repurchases [Roll Forward]
Authorized repurchase - as of January 1, 2015	$ 163,655,000
Additional board authorization					$ 250,000,000
Proceeds from the exercise of stock options	2,552,000
Repurchases of common stock	(159,800,000)	$ (545,140,000)	$ (195,004,000)	$ (896,175,000)
Authorized repurchase - as of December 31, 2015	$ 256,407,000	$ 163,655,000		$ 256,407,000

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Repurchases of Common Stock (Stock Repurchase Program 2013 - 2015) (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended			36 Months Ended
		Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2015
Accelerated Share Repurchases [Line Items]
Number of shares repurchased (in shares)		2,514,139	7,925,227	3,306,433	13,745,799
Average price per share (in usd per share)		$ 63.56	$ 68.31	$ 58.98	$ 65.20
Repurchases of common stock		$ 159,800	$ 545,140	$ 195,004	$ 896,175
Repurchases of common stock, excluding fees and expenses			$ 541,371
Open Market Share Repurchase
Accelerated Share Repurchases [Line Items]
Number of shares repurchased (in shares)			2,633,526
Average price per share (in usd per share)			$ 64.77
Repurchases of common stock			$ 170,582
Tender Offer
Accelerated Share Repurchases [Line Items]
Number of shares repurchased (in shares)	[1]		5,291,701
Average price per share (in usd per share)	[1]		$ 70.07
Repurchases of common stock	[1]		$ 370,789

[1] Fees and expenses totaling $3.7 million associated with the tender offer do not impact the repurchase program approved by our Board, are excluded from the total purchase price shown here and were recorded as part of the cost of treasury stock in our Consolidated Balance Sheets.

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Share-Based Payments (Summary of Grant Information) (Details) shares in Thousands	Dec. 31, 2015 shares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Unissued common stock reserved for issuance under all plans	1,034
Shares available for future grants	979

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Share-Based Payments (Schedule Of Information Regarding Share-Based Payments) (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based payments expense	$ 17,377	$ 13,384	$ 16,831
Tax benefit on share-based payments expense	$ 6,736	$ 5,134	$ 6,392
Per share weighted average grant date fair value of stock options granted	$ 0.00	$ 0.00	$ 53.90
Per share weighted average grant date fair value of restricted stock granted	$ 66.67	$ 71.37	$ 53.94
Total intrinsic value of stock options exercised	$ 1,061	$ 3,263	$ 10,567
Grant date fair value of restricted stock vested	12,631	13,036	12,641
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based payments expense	293	803	1,566
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based payments expense	12,102	11,214	10,504
Content Arrangements
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based payments expense	$ 4,982	$ 1,367	$ 4,761

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Share-Based Payments (Schedule Of Unrecognized Compensation Cost And Weighted-Average Remaining Life) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Share-Based Payments Expense	$ 20,271
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Share-Based Payments Expense	$ 149
Weighted-Average Remaining Life	10 months 24 days
Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Share-Based Payments Expense	$ 19,032
Weighted-Average Remaining Life	2 years 2 months 12 days
Content Arrangements
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized Share-Based Payments Expense	$ 1,090
Weighted-Average Remaining Life	9 months 22 days

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Share-Based Payments (Summary Of Stock Option Activity) (Details) shares in Thousands	12 Months Ended
	Dec. 31, 2015 $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding, Beginning of year, shares | shares	128
Granted, shares | shares	0
Exercised, shares | shares	(49)
Cancelled, expired or forfeited, shares | shares	(24)
Outstanding, Ending balance, shares | shares	55
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward]
Outstanding, Beginning of year, weighted average exercise price | $ / shares	$ 52.59
Granted, weighted average exercise price | $ / shares	0.00
Exercised, weighted average exercise price | $ / shares	52.10
Cancelled, expired or forfeited, weighted average exercise price | $ / shares	53.99
Outstanding, Ending balance, weighted average exercise price | $ / shares	$ 52.40

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Share-Based Payments (Schedule Of Information Regarding Stock Options Outstanding) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Options outstanding, Number	55	128
Options outstanding, weighted average per share exercise price	$ 52.40	$ 52.59
Options outstanding, aggregate intrinsic value	$ 35
Options outstanding, weighted average remaining contractual term (in years)	6 years 3 months 28 days
Options exercisable, Number	39
Options exercisable, weighted average per share exercise price	$ 51.67
Options exercisable, aggregate intrinsic value	$ 35
Options exercisable, weighted average remaining contractual term (in years)	6 years 1 month 2 days

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Share-Based Payments (Summary Of Restricted Stock Award Activity) (Details) - $ / shares shares in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
NON-VESTED, Beginning of year, shares	609
Granted (shares)	352
Vested, shares	(188)
Forfeited, shares	(217)
NON-VESTED, end of period, shares	556	609
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
NON-VESTED, Beginning of year, weighted average grant date fair value	$ 62.35
Per share weighted average grant date fair value of restricted stock granted	66.67	$ 71.37	$ 53.94
Vested, weighted average grant date fair value	59.09
Forfeited, weighted average grant date fair value	65.26
NON-VESTED, end of period, weighted average grant date fair value	$ 65.86	$ 62.35

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Share-Based Payments (Schedule Of Information Related To Restricted Stock Granted As Part Of DVD Arrangements) (Details) - shares		1 Months Ended	3 Months Ended		12 Months Ended
		Jan. 31, 2015	Dec. 31, 2015	Mar. 31, 2015	Dec. 31, 2015		Dec. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (shares)					352,000
Vested (shares)					188,000
Unvested (shares)			556,000		556,000		609,000
Sony
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (shares)			25,000		243,348	[1]
Vested (shares)			25,000		243,348	[1]
Unvested (shares)	[1]		0		0
Paramount
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (shares)				50,000	350,000	[2],[3]
Vested (shares)		95,000		50,000	350,000	[2],[3]
Unvested (shares)	[2],[3]		0		0

[1] Includes 25,000 shares granted and fully vested in the fourth quarter of 2015 due to a one-year contract extension executed in 2015.

[2] Includes 50,000 shares granted and fully vested in the first quarter of 2015 due to a one-year contract extension executed in 2015.

[3] Includes 95,000 shares that vested on January 1, 2015.

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Share-Based Payments (Rights to Receive Cash) (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Remaining total expected expense	$ 20,271
ecoATM
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
2016	1,868
2017	284
Remaining total expected expense	$ 2,152

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Share-Based Payments (Narrative) (Details) - USD ($) $ in Thousands		12 Months Ended
	Jul. 23, 2013	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payments expense		$ 17,377	$ 13,384	$ 16,831
ecoATM
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Fair value of original and replacement awards	$ 32,100
Replacement awards attributable to pre-combination services	$ 1,400
Share-based payments expense		4,400	13,300	8,700
Content Arrangements
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payments expense		4,982	1,367	4,761
Stock Options
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payments expense		293	803	1,566
Restricted Stock
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payments expense		$ 12,102	$ 11,214	$ 10,504
Paramount
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Shares of restricted stock to be issued in the first quarter of 2016		50,000
Awards Granted To Employees And Executives | Restricted Stock
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payment award vesting period, years		4 years
Awards Granted To Non Employee Directors | Restricted Stock
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payment award vesting period, years		1 year
Performance-based Restricted Stock Awards Granted to Executives
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Percentage of restricted stock awards vests two years from the date of grant		65.00%
Percentage of the restricted stock award vests three years from the date of grant		35.00%
Performance-based Restricted Stock Awards Granted to Executives | Restricted Stock
Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]
Share-based payment award vesting period, years		3 years

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Restructuring (Components of Restructuring Changes) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Restructuring Cost and Reserve [Line Items]
Long-term Purchase Commitment, Settlement Cost	$ 8,500
Restructuring Charges	19,713
Restructuring and related costs	522
Restructuring Charges, Continuing and Discontinued Operations	20,235
Redbox
Restructuring Cost and Reserve [Line Items]
Severance	4,236
Lease termination and related costs (excluding related asset impairments)	4,958
Long-term Purchase Commitment, Settlement Cost	7,021
Restructuring Charges	16,215
Coinstar
Restructuring Cost and Reserve [Line Items]
Severance	492
Lease termination and related costs (excluding related asset impairments)	100
Long-term Purchase Commitment, Settlement Cost	1,369
Restructuring Charges	1,961
ecoATM
Restructuring Cost and Reserve [Line Items]
Severance	602
Lease termination and related costs (excluding related asset impairments)	0
Long-term Purchase Commitment, Settlement Cost	85
Restructuring Charges	687
All Other
Restructuring Cost and Reserve [Line Items]
Severance	822
Lease termination and related costs (excluding related asset impairments)	2
Long-term Purchase Commitment, Settlement Cost	26
Restructuring Charges	$ 850

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Restructuring (Narratives) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2013
Restructuring and Related Activities [Abstract]
Restructuring Charges and Lease Termination Costs	$ 27,675
Impairment of long-lived assets to be disposed of	7,440	$ 32,732
Restructuring Charges, Continuing and Discontinued Operations	$ 20,235

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Restructuring (Components of Restructuring Changes from Continuing Operation) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Restructuring and Related Activities [Abstract]
Restructuring Charges, Continuing and Discontinued Operations	$ 20,235
Impairment of long-lived assets to be disposed of	7,440		$ 32,732
Restructuring Charges and Lease Termination Costs	27,675
Less: restructuring costs included in discontinued operations	(522)
Restructuring and related costs (Note 11)	$ 27,153	$ 557	$ 4,495

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Restructuring (Schedule of Beginning and End Liability Balance and Expense by Type) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Restructuring Cost and Reserve [Line Items]
Restructuring Charges, Continuing and Discontinued Operations	$ 20,235
Long-term Purchase Commitment, Settlement Cost	8,500
Employee Severance
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	0
Restructuring Charges, Continuing and Discontinued Operations	6,284	[1]
Restructuring and Related Cost, Expected Cost	0
Payments for Restructuring	(4,899)
Restructuring Reserve	1,385
Contract Termination Cost
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	0
Restructuring Charges, Continuing and Discontinued Operations	5,138
Restructuring and Related Cost, Expected Cost	5,260	[2]
Payments for Restructuring	(5,407)
Restructuring Reserve	4,991
Other Restructuring
Restructuring Cost and Reserve [Line Items]
Restructuring Reserve	0
Restructuring Charges, Continuing and Discontinued Operations	8,813
Restructuring and Related Cost, Expected Cost	0
Payments for Restructuring	(8,813)
Restructuring Reserve	$ 0

[1] Other includes an $8.5 million one-time payment to settle an outstanding purchase commitment.

[2] Deferred rent liabilities related to the early lease termination that were reclassified to present the outstanding liability related to the terminated leases.

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Restructuring (Restructuring and Related Costs from 2013 Restructuring Plan) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Incurred Cost	$ 1,147	$ 6,804
Cumulative as of end of period	7,951
Employee Severance
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Incurred Cost	557	4,495
Cumulative as of end of period	5,052
Redbox | Employee Severance
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Incurred Cost	534	3,771
Cumulative as of end of period	4,305
Coinstar | Employee Severance
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Incurred Cost	23	724
Cumulative as of end of period	747
Discontinued Operations
Restructuring Cost and Reserve [Line Items]
Restructuring and Related Cost, Incurred Cost	590	$ 2,309
Cumulative as of end of period	$ 2,899

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Discontinued Operations (Components of Discontinued Operations) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued operation, revenue	$ 1,972	$ 11,517	$ 11,215
Total loss before income tax	(13,605)	(24,966)	(74,225)
Discontinued operation, income tax benefit	8,496	6,907	26,329
Loss from discontinued operations, net of tax	(5,109)	(18,059)	(47,896)
Redbox Canada
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued operation, revenue	1,972	11,417	6,816
Total loss before income tax	(13,605)	(23,707)	(19,830)
Discontinued operation, income tax benefit	8,496	6,416	5,233
Loss from discontinued operations, net of tax	(5,109)	(17,291)	(14,597)
Certain New Ventures
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Discontinued operation, revenue	0	100	4,399
Total loss before income tax	0	(1,259)	(54,395)
Discontinued operation, income tax benefit	0	491	21,096
Loss from discontinued operations, net of tax	$ 0	$ (768)	$ (33,299)

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Discontinued Operations (Income Statement Disclosure of Discontinued Operations) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue	$ 1,972	$ 11,517	$ 11,215
Restructuring and related costs	522
Amortization of intangible assets	44	38	26
Pretax loss of discontinued operations related to major classes of pretax loss	(13,605)	(24,966)	(74,225)
Income tax benefit	8,496	6,907	26,329
Net loss on discontinued operations	(5,109)	(18,059)	(47,896)
Redbox Canada
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Revenue	1,972	11,417	6,816
Direct operating	4,533	20,027	18,278
Marketing	112	2,947	2,175
Research and development	0	0	2
General and administrative	117	1,078	3,088
Restructuring and related costs	522	0	0
Depreciation and other	5,857	7,354	2,760
Amortization of intangible assets	44	38	26
Other expense, net	(4,392)	(3,680)	(317)
Pretax loss of discontinued operations related to major classes of pretax loss	(13,605)	(23,707)	(19,830)
Income tax benefit	8,496	6,416	5,233
Net loss on discontinued operations	$ (5,109)	$ (17,291)	$ (14,597)

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Discontinued Operations (Significant Operating and Investing Cash Flow Activity of Discontinued Operations) (Details) - Redbox Canada - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net loss on discontinued operations	$ (5,109)	$ (17,291)	$ (14,597)
Depreciation and amortization	5,901	7,392	2,786
Content library	3,328	(787)	(410)
Prepaid and other current assets	1,329	(293)	(516)
Accounts payable	(2,663)	627	644
Accrued payables to retailers	(155)	(175)	247
Other accrued liabilities	(806)	(122)	506
Net cash flows from operating activities	1,825	(10,649)	(11,340)
Purchase of property, plant and equipment	(292)	(5,494)	(9,330)
Total cash flows used in investing activities	$ (292)	$ (5,494)	$ (9,330)

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Discontinued Operations (Discontinuation of Certain New Ventures) (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)	Dec. 31, 2013 USD ($) concept
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets to be disposed of	$ 7,440	$ 32,732
Number of discontinued concepts | concept		4
Rubi
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets to be disposed of		$ 21,317
Orango
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets to be disposed of		5,551
Crisp Market
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets to be disposed of		289
Star Studio
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets to be disposed of		2,786
Corporate Assets
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment of long-lived assets to be disposed of		$ 2,789

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Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands		12 Months Ended
		Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Earnings Per Share [Abstract]
Income from continuing operations		$ 49,446	$ 124,677	$ 222,688
Loss from discontinued operations, net of tax		(5,109)	(18,059)	(47,896)
Net income		44,337	106,618	174,792
Dividends and undistributed income allocated to participating shares		(1,329)	(3,929)	(5,473)
Income from continuing operations to common shares - basic		48,117	120,748	217,215
Effect of reallocating undistributed income from continuing operations to participating shares		1	58	179
Income from continuing operations to common shares - diluted		$ 48,118	$ 120,806	$ 217,394
Weighted average common shares - basic (in shares)		17,467	20,192	27,216
Dilutive effect of share-based payment awards (in shares)		20	81	235
Dilutive effect of convertible debt (in shares)		0	230	718
Weighted average shares used for diluted EPS (in shares)	[1]	17,487	20,503	28,169
Basic earnings (loss) per common share:
Continuing operations (in usd per share)		$ 2.75	$ 5.98	$ 7.98
Discontinued operations (in usd per share)		(0.29)	(0.89)	(1.76)
Basic earnings per share (in usd per share)		2.46	5.09	6.22
Diluted earnings (loss) per common share:
Continuing operations (in usd per share)		2.75	5.89	7.72
Discontinued operations (in usd per share)		(0.29)	(0.88)	(1.70)
Diluted earnings per share (in usd per share)		$ 2.46	$ 5.01	$ 6.02
Stock options and share-based awards not included in diluted EPS calculation because their effect would be antidilutive		7	11	13

[1] Participating securities were included in the calculation of diluted earnings per share using the two-class method, as this calculation was more dilutive than the calculation using the treasury stock method.

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Business Segments and Enterprise-Wide Information (Schedule Of Segment Performance) (Details) - USD ($) $ in Thousands		3 Months Ended	12 Months Ended
		Jun. 30, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Segment Reporting Information [Line Items]
Revenue			$ 2,193,211	$ 2,291,586	$ 2,299,785
Expenses:
Direct operating	[1]		1,493,088	1,581,311	1,556,999
Marketing			35,674	35,293	30,227
Research and development			7,198	13,047	13,082
General and administrative			190,393	190,496	215,798
Restructuring and related costs (Note 11)			27,153	557	4,495
Goodwill impairment (Note 6)		$ 85,900	85,890	0	0
Segment operating income (loss)			353,815	470,882	479,184
Less: depreciation and amortization			(184,940)	(202,478)	(200,308)
Operating income			168,875	268,404	278,876
Loss from equity method investments, net			(800)	(28,734)	19,928
Interest expense, net			(42,353)	(47,644)	(32,807)
Other, net			(2,657)	(1,185)	(3,599)
Income from continuing operations before income taxes			123,065	190,841	262,398
Redbox
Expenses:
Goodwill impairment (Note 6)			0
Coinstar
Expenses:
Goodwill impairment (Note 6)			0
ecoATM
Expenses:
Goodwill impairment (Note 6)			85,890
Operating segments | Redbox
Segment Reporting Information [Line Items]
Revenue			1,760,899	1,881,718	1,967,715
Expenses:
Direct operating			1,213,744	1,318,509	1,365,368
Marketing			19,804	20,969	20,835
Research and development			0	120	76
General and administrative			129,013	135,554	160,863
Restructuring and related costs (Note 11)			23,540	534	3,771
Goodwill impairment (Note 6)			0
Segment operating income (loss)			374,798	406,032	416,802
Less: depreciation and amortization			(118,902)	(149,236)	(159,851)
Operating income			255,896	256,796	256,951
Loss from equity method investments, net			0	0	0
Interest expense, net			0	0	0
Other, net			0	0	0
Income from continuing operations before income taxes			255,896	256,796	256,951
Operating segments | Coinstar
Segment Reporting Information [Line Items]
Revenue			318,611	315,628	300,218
Expenses:
Direct operating			159,211	161,214	158,562
Marketing			5,566	6,346	6,244
Research and development			0	531	6,962
General and administrative			31,561	26,989	25,220
Restructuring and related costs (Note 11)			2,076	23	724
Goodwill impairment (Note 6)			0
Segment operating income (loss)			120,197	120,525	102,506
Less: depreciation and amortization			(31,871)	(35,471)	(33,921)
Operating income			88,326	85,054	68,585
Loss from equity method investments, net			0	0	0
Interest expense, net			0	0	0
Other, net			0	0	0
Income from continuing operations before income taxes			88,326	85,054	68,585
Operating segments | ecoATM
Segment Reporting Information [Line Items]
Revenue			113,558	94,187	31,824
Expenses:
Direct operating			113,141	92,182	27,271
Marketing			8,481	3,513	938
Research and development			5,545	5,691	2,772
General and administrative			10,875	12,773	7,868
Restructuring and related costs (Note 11)			687	0	0
Goodwill impairment (Note 6)			85,890
Segment operating income (loss)			(111,061)	(19,972)	(7,025)
Less: depreciation and amortization			(26,382)	(17,031)	(6,077)
Operating income			(137,443)	(37,003)	(13,102)
Loss from equity method investments, net			0	0	0
Interest expense, net			0	0	0
Other, net			0	0	0
Income from continuing operations before income taxes			(137,443)	(37,003)	(13,102)
Operating segments | All Other
Segment Reporting Information [Line Items]
Revenue			143	53	28
Expenses:
Direct operating			4,431	2,821	2,162
Marketing			1,128	1,272	651
Research and development			(84)	2,854	1,897
General and administrative			7,188	3,522	7,683
Restructuring and related costs (Note 11)			850	0	0
Goodwill impairment (Note 6)			0
Segment operating income (loss)			(13,370)	(10,416)	(12,365)
Less: depreciation and amortization			(7,785)	(740)	(459)
Operating income			(21,155)	(11,156)	(12,824)
Loss from equity method investments, net			0	0	0
Interest expense, net			0	0	0
Other, net			0	0	0
Income from continuing operations before income taxes			(21,155)	(11,156)	(12,824)
Corporate unallocated
Segment Reporting Information [Line Items]
Revenue			0	0	0
Expenses:
Direct operating			2,561	6,585	3,636
Marketing			695	3,193	1,559
Research and development			1,737	3,851	1,375
General and administrative			11,756	11,658	14,164
Restructuring and related costs (Note 11)			0	0	0
Goodwill impairment (Note 6)			0
Segment operating income (loss)			(16,749)	(25,287)	(20,734)
Less: depreciation and amortization			0	0	0
Operating income			(16,749)	(25,287)	(20,734)
Loss from equity method investments, net			(800)	(28,734)	19,928
Interest expense, net			(42,353)	(47,644)	(32,807)
Other, net			(2,657)	(1,185)	(3,599)
Income from continuing operations before income taxes			$ (62,559)	$ (102,850)	$ (37,212)

[1] “Direct operating” excludes depreciation and other of $118.7 million, $125.7 million and $129.1 million for 2015, 2014 and 2013, respectively.

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Business Segments and Enterprise-Wide Information (Schedule Of Contributions By Major Customers) (Details) - Customer Concentration Risk - Sales Revenue, Net	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Wal-Mart Stores Inc.
Revenue, Major Customer [Line Items]
Percentage of revenue contributed by major customers	16.60%	15.50%	15.20%
Walgreen Co.
Revenue, Major Customer [Line Items]
Percentage of revenue contributed by major customers	13.40%	13.80%	14.70%
The Kroger Company
Revenue, Major Customer [Line Items]
Percentage of revenue contributed by major customers	9.80%	9.80%	10.00%

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Business Segments and Enterprise-Wide Information (Schedule of Revenue and Long-Lived Assets by Geographic Location) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	$ 2,193,211	$ 2,291,586	$ 2,299,785
Long-Lived Assets	862,583	1,060,697	1,178,630
UNITED STATES
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	2,145,887	2,242,753	2,254,790
Long-Lived Assets	848,450	1,027,271	1,140,224
Foreign
Revenues from External Customers and Long-Lived Assets [Line Items]
Revenue	47,324	48,833	44,995
Long-Lived Assets	$ 14,133	$ 33,426	$ 38,406

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Fair Value (Assets And Liabilities Measured At Fair Value) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market demand accounts and investment grade fixed income securities	$ 2,700	$ 900
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market demand accounts and investment grade fixed income securities	2,743	916
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market demand accounts and investment grade fixed income securities	0	0
Fair Value, Measurements, Recurring | Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Money market demand accounts and investment grade fixed income securities	$ 0	$ 0

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Fair Value (Narrative) (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended
	Dec. 31, 2011	Dec. 31, 2013	Sep. 30, 2013	Dec. 31, 2015	Dec. 31, 2014	Jun. 09, 2011
Fair Value Disclosure [Line Items]
Proceeds from Collection of Notes Receivable		$ 24.8
Benefit from Release of Indemnification Related Reserve		$ 2.5
Notes Receivable
Fair Value Disclosure [Line Items]
Market discount rate	18.00%
Money Transfer Business
Fair Value Disclosure [Line Items]
Cash Received From Sale Of Business						$ 19.5
Notes, Loans and Financing Receivable, Gross, Noncurrent						$ 29.5
Credit Facility Offered As Part Money Transfer Sale	$ 4.0
Notes Receivable
Fair Value Disclosure [Line Items]
Asset Impairment Charges			$ 2.8
Fair Value, Inputs, Level 2 | Senior Notes | Senior Unsecured Notes due 2019
Fair Value Disclosure [Line Items]
Estimated fair value of senior unsecured notes				$ 312.0	$ 350.0
Fair Value, Inputs, Level 2 | Senior Notes | 2021 Notes
Fair Value Disclosure [Line Items]
Estimated fair value of senior unsecured notes				$ 213.0	$ 300.0

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Commitments and Contingencies (Narrative) (Details)	3 Months Ended		12 Months Ended
	Dec. 31, 2015 USD ($) ft² Quantity shares	Sep. 30, 2015 shares	Dec. 31, 2015 USD ($) ft² Quantity shares	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)
Long-term Purchase Commitment [Line Items]
Long-term Purchase Commitment, Settlement Cost			$ 8,500,000
Purchase commitments			$ 24,500,000
Shares of restricted stock issued during the fourth quarter of 2015 | shares			352,000
Resolve of loss contingency related to a supply agreement					$ 11,400,000
Pending Litigation [Member]
Long-term Purchase Commitment [Line Items]
Loss contingency accrual	$ 0		$ 0
Standby Letters of Credit [Member]
Long-term Purchase Commitment [Line Items]
Number of irrevocable standby letters of credit | Quantity	5		5
Maximum capacity to guarantee under existing letters of credit	$ 6,500,000		$ 6,500,000
Irrevocable standby letters of credit, amount outstanding	$ 0		$ 0
Manufacturing and Service Agreement as Part of Asset Acquisition [Member]
Long-term Purchase Commitment [Line Items]
Purchase obligation, term			5 years
Minimum margin to be paid			$ 25,000,000
Purchases, Margin Reduction of Commitment Amount			400,000	$ 2,100,000	7,100,000
Long-term Purchase Commitment, Settlement Cost			8,500,000
Long-term Purchase Commitment, Settlement of Remaining Balance			$ 15,400,000
Content Arrangements | Paramount
Long-term Purchase Commitment [Line Items]
Shares of restricted stock to be issued in the first quarter of 2016 | shares	50,000
Content Arrangements | Sony
Long-term Purchase Commitment [Line Items]
Shares of restricted stock issued during the fourth quarter of 2015 | shares		25,000
Operating Lease [Member]
Long-term Purchase Commitment [Line Items]
Lease Extension Period			5 years
New operating lease square feet | ft²	16,085		16,085
Rent expense, net of sublease income under operating lease agreements			$ 18,000,000	$ 16,800,000	$ 12,300,000

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Commitments and Contingencies (Schedule of Capital Leased Assets) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Commitments and Contingencies Disclosure [Abstract]
Gross property and equipment	$ 26,394	$ 41,336
Accumulated depreciation	(20,735)	(26,831)
Net property and equipment	$ 5,659	$ 14,505

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Commitments and Contingencies (Schedule of Minimum Lease Obligations) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2016	$ 4,144
2017	1,011
2018	429
2019	305
2020	209
Thereafter	123
Total minimum lease commitments	6,221
Capital Leases, Future Minimum Sublease Rentals	0
Capital Leases, Future Minimum Payments Due, Net Of Sublease Rentals	6,221
Less: amounts representing interest	(332)
Present value of capital lease obligations	5,889
Less: Current portion of capital lease obligations	(4,006)	$ (11,026)
Long-term portion of capital lease obligations	1,883	$ 4,365
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2016	18,969
2017	13,445
2018	10,215
2019	7,986
2020	4,936
Thereafter	7,132
Total minimum lease commitments	62,683
Operating Leases, Future Minimum Payments Due, Future Minimum Sublease Rentals	(1,332)
Operating Leases, Future Minimum Payments Due, Net Of Sublease Rentals	$ 61,351

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Commitments and Contingencies (Summary of License Agreements) (Details) $ in Thousands	Dec. 31, 2015 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Total estimated movie commitments	$ 448,718
Estimated movie commitments - 2016	381,275
Estimated movie commitments - 2017	$ 67,443

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Commitments and Contingencies (Revenue Share Commitments) (Details) - Redbox $ in Thousands	Dec. 31, 2015 USD ($)
Revenue Share Commitments [Line Items]
Total	$ 2,365
2016	1,711
2017	523
2018	$ 131

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Guarantor Subsidiaries (Condensed Consolidating Balance Sheets) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Current Assets:
Cash and cash equivalents	$ 222,549	$ 242,696	$ 371,437	$ 282,894
Accounts receivable, net of allowances	38,464	48,590
Content library	188,490	180,121
Prepaid expenses and other current assets	51,368	39,819
Intercompany receivables	0	0
Total current assets	500,871	511,226
Property and equipment, net	316,013	428,468
Deferred income taxes	2,606	11,363
Goodwill and other intangible assets, net	540,514	623,998
Other long-term assets	6,056	8,231
Investment in related parties	0	0
Total assets	1,366,060	1,583,286
Current Liabilities:
Accounts payable	184,010	168,633
Accrued payable to retailers	115,098	126,290
Other accrued liabilities	141,437	137,126
Current portion of long-term debt and other long-term liabilities	17,131	20,416
Intercompany payables	0	0
Total current liabilities	457,676	452,465
Long-term debt and other long-term liabilities	897,366	973,669
Deferred income taxes	33,092	59,774
Total liabilities	$ 1,388,134	$ 1,485,908
Commitments and contingencies
Stockholders’ Equity (Deficit):
Preferred stock	$ 0	$ 0
Common stock	485,163	473,592
Treasury stock	(1,151,063)	(996,293)
Retained earnings	643,452	620,389
Accumulated other comprehensive income (loss)	374	(310)
Total stockholders’ equity (deficit)	(22,074)	97,378	518,689	549,088
Total liabilities and stockholders’ equity (deficit)	1,366,060	1,583,286
Reportable Legal Entities | Outerwall Inc.
Current Assets:
Cash and cash equivalents	160,167	180,889	315,250	242,489
Accounts receivable, net of allowances	3,983	3,203
Content library	0	0
Prepaid expenses and other current assets	17,720	14,884
Intercompany receivables	35,654	40,762
Total current assets	217,524	239,738
Property and equipment, net	97,659	133,923
Deferred income taxes	0	0
Goodwill and other intangible assets, net	249,703	249,717
Other long-term assets	4,596	6,665
Investment in related parties	921,456	917,234
Total assets	1,490,938	1,547,277
Current Liabilities:
Accounts payable	16,127	12,899
Accrued payable to retailers	71,947	69,189
Other accrued liabilities	57,025	59,770
Current portion of long-term debt and other long-term liabilities	16,832	20,020
Intercompany payables	459,789	309,932
Total current liabilities	621,720	471,810
Long-term debt and other long-term liabilities	877,325	949,588
Deferred income taxes	13,965	28,500
Total liabilities	$ 1,513,010	1,449,898
Commitments and contingencies
Stockholders’ Equity (Deficit):
Preferred stock	$ 0
Common stock	599,675	588,105
Treasury stock	(1,151,063)	(996,293)
Retained earnings	530,140	506,360
Accumulated other comprehensive income (loss)	(824)	(793)
Total stockholders’ equity (deficit)	(22,072)	97,379
Total liabilities and stockholders’ equity (deficit)	1,490,938	1,547,277
Reportable Legal Entities | Combined Guarantor Subsidiaries
Current Assets:
Cash and cash equivalents	19,372	17,939	9,639	0
Accounts receivable, net of allowances	33,269	43,874
Content library	188,490	176,490
Prepaid expenses and other current assets	33,049	23,923
Intercompany receivables	527,996	467,181
Total current assets	802,176	729,407
Property and equipment, net	204,081	263,412
Deferred income taxes	0	0
Goodwill and other intangible assets, net	290,811	374,281
Other long-term assets	1,293	1,231
Investment in related parties	27,798	(5,114)
Total assets	1,326,159	1,363,217
Current Liabilities:
Accounts payable	167,694	153,260
Accrued payable to retailers	30,157	42,977
Other accrued liabilities	82,401	74,536
Current portion of long-term debt and other long-term liabilities	0	0
Intercompany payables	85,487	121,015
Total current liabilities	365,739	391,788
Long-term debt and other long-term liabilities	19,882	22,946
Deferred income taxes	19,083	31,249
Total liabilities	$ 404,704	445,983
Commitments and contingencies
Stockholders’ Equity (Deficit):
Preferred stock	$ 0
Common stock	252,727	225,729
Treasury stock	0	0
Retained earnings	668,728	691,505
Accumulated other comprehensive income (loss)	0	0
Total stockholders’ equity (deficit)	921,455	917,234
Total liabilities and stockholders’ equity (deficit)	1,326,159	1,363,217
Reportable Legal Entities | Combined Non-Guarantor Subsidiaries
Current Assets:
Cash and cash equivalents	43,010	43,868	46,548	40,759
Accounts receivable, net of allowances	1,212	1,513
Content library	0	3,631
Prepaid expenses and other current assets	599	1,012
Intercompany receivables	426	0
Total current assets	45,247	50,024
Property and equipment, net	14,273	31,133
Deferred income taxes	2,606	11,363
Goodwill and other intangible assets, net	0	0
Other long-term assets	167	335
Investment in related parties	0	0
Total assets	62,293	92,855
Current Liabilities:
Accounts payable	189	2,474
Accrued payable to retailers	12,994	14,124
Other accrued liabilities	2,011	2,820
Current portion of long-term debt and other long-term liabilities	299	396
Intercompany payables	18,800	76,996
Total current liabilities	34,293	96,810
Long-term debt and other long-term liabilities	159	1,135
Deferred income taxes	44	25
Total liabilities	$ 34,496	97,970
Commitments and contingencies
Stockholders’ Equity (Deficit):
Preferred stock	$ 0
Common stock	4,636	12,393
Treasury stock	3,000	0
Retained earnings	18,963	(17,991)
Accumulated other comprehensive income (loss)	1,198	483
Total stockholders’ equity (deficit)	27,797	(5,115)
Total liabilities and stockholders’ equity (deficit)	62,293	92,855
Eliminations and Consolidation Reclassifications
Current Assets:
Cash and cash equivalents	0	0	$ 0	$ (354)
Accounts receivable, net of allowances	0	0
Content library	0	0
Prepaid expenses and other current assets	0	0
Intercompany receivables	(564,076)	(507,943)
Total current assets	(564,076)	(507,943)
Property and equipment, net	0	0
Deferred income taxes	0	0
Goodwill and other intangible assets, net	0	0
Other long-term assets	0	0
Investment in related parties	(949,254)	(912,120)
Total assets	(1,513,330)	(1,420,063)
Current Liabilities:
Accounts payable	0	0
Accrued payable to retailers	0	0
Other accrued liabilities	0	0
Current portion of long-term debt and other long-term liabilities	0	0
Intercompany payables	(564,076)	(507,943)
Total current liabilities	(564,076)	(507,943)
Long-term debt and other long-term liabilities	0	0
Deferred income taxes	0	0
Total liabilities	$ (564,076)	(507,943)
Commitments and contingencies
Stockholders’ Equity (Deficit):
Preferred stock	$ 0
Common stock	(371,875)	(352,635)
Treasury stock	(3,000)	0
Retained earnings	(574,379)	(559,485)
Accumulated other comprehensive income (loss)	0	0
Total stockholders’ equity (deficit)	(949,254)	(912,120)
Total liabilities and stockholders’ equity (deficit)	$ (1,513,330)	$ (1,420,063)

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Guarantor Subsidiaries (Condensed Consolidating Statements of Comprehensive Income) (Details) - USD ($)		3 Months Ended	12 Months Ended
		Jun. 30, 2015	Dec. 31, 2015		Dec. 31, 2014		Dec. 31, 2013
Condensed Financial Statements, Captions [Line Items]
Revenue			$ 2,193,211,000		$ 2,291,586,000		$ 2,299,785,000
Expenses:
Direct operating	[1]		1,493,088,000		1,581,311,000		1,556,999,000
Marketing			35,674,000		35,293,000		30,227,000
Research and development			7,198,000		13,047,000		13,082,000
General and administrative			190,393,000		190,496,000		215,798,000
Restructuring and lease termination costs			27,153,000		557,000		4,495,000
Depreciation and other			171,390,000		187,824,000		189,401,000
Amortization of intangible assets			13,550,000		14,654,000		10,907,000
Goodwill impairment		$ 85,900,000	85,890,000		0		0
Total expenses			2,024,336,000		2,023,182,000		2,020,909,000
Operating income (loss)			168,875,000		268,404,000		278,876,000
Other income (expense), net:
Loss from equity method investments, net			(800,000)		(28,734,000)		19,928,000
Interest expense, net			(42,353,000)		(47,644,000)		(32,807,000)
Other, net			(2,657,000)		(1,185,000)		(3,599,000)
Total other expense, net			(45,810,000)		(77,563,000)		(16,478,000)
Income (loss) from continuing operations before income taxes			123,065,000		190,841,000		262,398,000
Income tax benefit (expense)			(73,619,000)		(66,164,000)		(39,710,000)
Income (loss) from continuing operations			49,446,000		124,677,000		222,688,000
Loss from discontinued operations, net of tax			(5,109,000)		(18,059,000)		(47,896,000)
Equity in income (loss) of subsidiaries			0		0		0
Net income			44,337,000		106,618,000		174,792,000
Foreign currency translation adjustment	[2]		684,000	[3]	457,000	[4]	856,000	[5]
Comprehensive income (loss)			45,021,000		107,075,000		175,648,000
Foreign currency translation adjustment, tax effect			0		0		0
Reportable Legal Entities | Outerwall Inc.
Condensed Financial Statements, Captions [Line Items]
Revenue			271,430,000		266,848,000		255,251,000
Expenses:
Direct operating			143,429,000		142,472,000		138,859,000
Marketing			6,485,000		7,227,000		6,540,000
Research and development			(83,000)		3,456,000		8,973,000
General and administrative			47,699,000		39,412,000		33,023,000
Restructuring and lease termination costs			2,926,000		23,000		724,000
Depreciation and other			32,643,000		35,155,000		28,101,000
Amortization of intangible assets			14,000		1,433,000		2,245,000
Goodwill impairment			0
Total expenses			233,113,000		229,178,000		218,465,000
Operating income (loss)			38,317,000		37,670,000		36,786,000
Other income (expense), net:
Loss from equity method investments, net			(800,000)		(530,000)		65,063,000
Interest expense, net			30,177,000		(48,007,000)		(32,930,000)
Other, net			15,273,000		14,077,000		(3,868,000)
Total other expense, net			44,650,000		(34,460,000)		28,265,000
Income (loss) from continuing operations before income taxes			82,967,000		3,210,000		65,051,000
Income tax benefit (expense)			(31,603,000)		(618,000)		30,893,000
Income (loss) from continuing operations			51,364,000		2,592,000		95,944,000
Loss from discontinued operations, net of tax			640,000		(803,000)		(30,834,000)
Equity in income (loss) of subsidiaries			(7,667,000)		104,829,000		109,682,000
Net income			44,337,000		106,618,000		174,792,000
Foreign currency translation adjustment			(31,000)	[3]	368,000	[4]	(105,000)	[5]
Comprehensive income (loss)			44,306,000		106,986,000		174,687,000
Reportable Legal Entities | Combined Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Revenue			1,874,457,000		1,975,905,000		1,999,539,000
Expenses:
Direct operating			1,328,269,000		1,415,132,000		1,394,932,000
Marketing			28,916,000		27,631,000		23,269,000
Research and development			7,281,000		9,591,000		4,111,000
General and administrative			142,012,000		150,211,000		169,099,000
Restructuring and lease termination costs			24,227,000		534,000		3,771,000
Depreciation and other			134,522,000		148,217,000		157,292,000
Amortization of intangible assets			13,536,000		13,221,000		8,662,000
Goodwill impairment			85,890,000
Total expenses			1,764,653,000		1,764,537,000		1,761,136,000
Operating income (loss)			109,804,000		211,368,000		238,403,000
Other income (expense), net:
Loss from equity method investments, net			0		(28,204,000)		(45,135,000)
Interest expense, net			(72,164,000)		572,000		257,000
Other, net			1,354,000		1,334,000		479,000
Total other expense, net			(70,810,000)		(26,298,000)		(44,399,000)
Income (loss) from continuing operations before income taxes			38,994,000		185,070,000		194,004,000
Income tax benefit (expense)			(41,785,000)		(64,989,000)		(70,577,000)
Income (loss) from continuing operations			(2,791,000)		120,081,000		123,427,000
Loss from discontinued operations, net of tax			(28,068,000)		(874,000)		(2,708,000)
Equity in income (loss) of subsidiaries			23,192,000		(14,378,000)		(11,037,000)
Net income			(7,667,000)		104,829,000		109,682,000
Foreign currency translation adjustment			0	[3]	0	[4]	0	[5]
Comprehensive income (loss)			(7,667,000)		104,829,000		109,682,000
Reportable Legal Entities | Combined Non-Guarantor Subsidiaries
Condensed Financial Statements, Captions [Line Items]
Revenue			47,324,000		48,833,000		44,995,000
Expenses:
Direct operating			21,390,000		23,707,000		36,155,000
Marketing			273,000		435,000		418,000
Research and development			0		0		(2,000)
General and administrative			682,000		873,000		721,000
Restructuring and lease termination costs			0		0		0
Depreciation and other			4,225,000		4,452,000		4,008,000
Amortization of intangible assets			0		0		0
Goodwill impairment			0
Total expenses			26,570,000		29,467,000		41,300,000
Operating income (loss)			20,754,000		19,366,000		3,695,000
Other income (expense), net:
Loss from equity method investments, net			0		0		0
Interest expense, net			(366,000)		(209,000)		(134,000)
Other, net			(19,284,000)		(16,596,000)		(218,000)
Total other expense, net			(19,650,000)		(16,805,000)		(352,000)
Income (loss) from continuing operations before income taxes			1,104,000		2,561,000		3,343,000
Income tax benefit (expense)			(231,000)		(557,000)		(26,000)
Income (loss) from continuing operations			873,000		2,004,000		3,317,000
Loss from discontinued operations, net of tax			22,319,000		(16,382,000)		(14,354,000)
Equity in income (loss) of subsidiaries			0		0		0
Net income			23,192,000		(14,378,000)		(11,037,000)
Foreign currency translation adjustment			715,000	[3]	89,000	[4]	961,000	[5]
Comprehensive income (loss)			23,907,000		(14,289,000)		(10,076,000)
Eliminations and Consolidation Reclassifications
Condensed Financial Statements, Captions [Line Items]
Revenue			0		0		0
Expenses:
Direct operating			0		0		(12,947,000)
Marketing			0		0		0
Research and development			0		0		0
General and administrative			0		0		12,955,000
Restructuring and lease termination costs			0		0		0
Depreciation and other			0		0		0
Amortization of intangible assets			0		0		0
Goodwill impairment			0
Total expenses			0		0		8,000
Operating income (loss)			0		0		(8,000)
Other income (expense), net:
Loss from equity method investments, net			0		0		0
Interest expense, net			0		0		0
Other, net			0		0		8,000
Total other expense, net			0		0		8,000
Income (loss) from continuing operations before income taxes			0		0		0
Income tax benefit (expense)			0		0		0
Income (loss) from continuing operations			0		0		0
Loss from discontinued operations, net of tax			0		0		0
Equity in income (loss) of subsidiaries			(15,525,000)		(90,451,000)		(98,645,000)
Net income			(15,525,000)		(90,451,000)		(98,645,000)
Foreign currency translation adjustment			0	[3]	0	[4]	0	[5]
Comprehensive income (loss)			$ (15,525,000)		$ (90,451,000)		$ (98,645,000)

[1] “Direct operating” excludes depreciation and other of $118.7 million, $125.7 million and $129.1 million for 2015, 2014 and 2013, respectively.

[2] Foreign currency translation adjustment had no tax effect in 2015, 2014 and 2013.

[3] Foreign currency translation adjustment had no tax effect in 2015.

[4] Foreign currency translation adjustment had no tax effect in 2014.

[5] Foreign currency translation adjustment had no tax effect in 2013.

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Guarantor Subsidiaries (Condensed Consolidating Statements of Cash Flows) (Details) - USD ($) $ in Thousands			3 Months Ended	12 Months Ended
		Nov. 10, 2015	Jun. 30, 2015	Dec. 31, 2015		Dec. 31, 2014		Dec. 31, 2013
Operating Activities:
Net income				$ 44,337		$ 106,618		$ 174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other				177,247		195,162		193,700
Amortization of intangible assets				13,594		14,692		10,933
Share-based payments expense				17,240		13,384		16,831
Windfall excess tax benefits related to share-based payments				(739)		(1,964)		(3,698)
Deferred income taxes				(19,619)		(22,611)		(10,933)
Impairment expense, restructuring and lease termination costs	[1]			2,054		0		32,732
(Income) loss from equity method investments, net				800		28,734		(19,928)
Amortization of deferred financing fees and debt discount				2,761		4,116		6,394
(Gain) loss from early extinguishment of debt				(5,854)		2,018		6,013
Gain on purchase of Gazelle (Note 3)		$ (989)		(989)		0		0
Goodwill impairment			$ 85,900	85,890		0		0
Other				(972)		(1,750)		(2,039)
Equity in income (loss) of subsidiaries				0		0		0
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net				10,011		8,671		7,978
Content library				(8,320)		19,747		(22,459)
Prepaid expenses and other current assets				(10,065)		44,282		(50,542)
Other assets				162		1,702		230
Accounts payable				17,943		(68,912)		1,491
Accrued payable to retailers				(9,968)		(6,847)		(4,088)
Other accrued liabilities				10,572		1,309		(9,573)
Net Cash Provided by (Used in) Operating Activities				326,085	[2]	338,351	[3]	327,834	[4]
Investing Activities:
Purchases of property and equipment				(77,591)		(97,924)		(161,412)
Proceeds from sale of property and equipment				3,225		1,977		13,344
Acquisitions, net of cash acquired				(17,980)		0		(244,036)
Receipt of note receivable principal				0		0		22,913
Cash paid for equity investments				0		(24,500)		(28,000)
Extinguishment payment received from equity investment				0		5,000		0
Investments in and advances to affiliates				0		0		0
Net Cash Provided by (Used in) Investing Activities				(92,346)	[2]	(115,447)	[3]	(397,191)	[4]
Financing Activities:
Proceeds from issuance of senior unsecured notes				0		295,500		343,769
Proceeds from new borrowing on Credit Facility				310,500		642,000		400,000
Principal payments on Credit Facility				(339,375)		(680,125)		(215,313)
Settlement and conversion of convertible debt				0		(51,149)		(172,211)
Repurchases of common stock	[5]			(159,800)		(545,091)		(195,004)
Repurchase of Notes (Note 9)				(34,589)		0		0
Dividends paid				(21,210)		0		0
Principal payments on capital lease obligations and other debt				(11,510)		(13,996)		(14,834)
Financing costs associated with Credit Facility and senior unsecured notes	[6]			(9)		(2,911)		(2,203)
Windfall excess tax benefits related to share-based payments				739		1,964		3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options				(1,461)		(520)		8,460
Net cash flows from (used in) financing activities	[7]			(256,715)	[2]	(354,328)	[3]	156,362	[4]
Effect of exchange rate changes on cash				2,829		2,683		1,538
Increase (decrease) in cash and cash equivalents				(20,147)		(128,741)		88,543
Cash and cash equivalents:
Beginning of period				242,696		371,437		282,894
End of period				222,549		242,696		371,437
Reportable Legal Entities | Outerwall Inc.
Operating Activities:
Net income				44,337		106,618		174,792
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other				32,643		35,139		29,640
Amortization of intangible assets				14		1,433		2,245
Share-based payments expense				10,323		9,693		9,903
Windfall excess tax benefits related to share-based payments				(739)		(1,964)		(3,698)
Deferred income taxes				(14,533)		304		9,228
Impairment expense, restructuring and lease termination costs				509				32,444
(Income) loss from equity method investments, net				800		530		(65,063)
Amortization of deferred financing fees and debt discount				2,761		4,116		6,394
(Gain) loss from early extinguishment of debt				(5,854)		2,018		6,013
Gain on purchase of Gazelle (Note 3)				0
Goodwill impairment				0
Other				(539)		(1,250)		827
Equity in income (loss) of subsidiaries				7,667		(104,829)		(109,682)
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net				(781)		(1,130)		(1,144)
Content library				0		36		1,093
Prepaid expenses and other current assets				(2,826)		40,826		(43,762)
Other assets				66		75		201
Accounts payable				(1,316)		(3,017)		1,319
Accrued payable to retailers				2,758		(1,896)		(6,181)
Other accrued liabilities				(391)		(840)		13,184
Net Cash Provided by (Used in) Operating Activities				74,899	[2]	85,862	[3]	57,753	[4]
Investing Activities:
Purchases of property and equipment				(26,861)		(33,602)		(58,763)
Proceeds from sale of property and equipment				17		750		12,147
Acquisitions, net of cash acquired				0				(244,036)
Receipt of note receivable principal								22,913
Cash paid for equity investments						0		0
Extinguishment payment received from equity investment						0
Investments in and advances to affiliates				187,538		166,145		125,856
Net Cash Provided by (Used in) Investing Activities				160,694	[2]	133,293	[3]	(141,883)	[4]
Financing Activities:
Proceeds from issuance of senior unsecured notes						295,500		343,769
Proceeds from new borrowing on Credit Facility				310,500		642,000		400,000
Principal payments on Credit Facility				(339,375)		(680,125)		(215,313)
Settlement and conversion of convertible debt						(51,149)		(172,211)
Repurchases of common stock				(159,800)		(545,091)		(195,004)
Repurchase of Notes (Note 9)				(34,589)
Dividends paid				(21,210)
Principal payments on capital lease obligations and other debt				(11,110)		(13,552)		(14,200)
Financing costs associated with Credit Facility and senior unsecured notes				(9)		(2,911)		(2,203)
Windfall excess tax benefits related to share-based payments				739		1,964		3,698
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options				(1,461)		(520)		8,460
Net cash flows from (used in) financing activities				(256,315)	[2]	(353,884)	[3]	156,996	[4]
Effect of exchange rate changes on cash				0		368		(105)
Increase (decrease) in cash and cash equivalents				(20,722)		(134,361)		72,761
Cash and cash equivalents:
Beginning of period				180,889		315,250		242,489
End of period				160,167		180,889		315,250
Reportable Legal Entities | Combined Guarantor Subsidiaries
Operating Activities:
Net income				(7,667)		104,829		109,682
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other				136,367		150,904		158,801
Amortization of intangible assets				13,536		13,259		8,688
Share-based payments expense				6,917		3,691		6,928
Windfall excess tax benefits related to share-based payments				0		0		0
Deferred income taxes				(12,730)		(17,232)		(15,727)
Impairment expense, restructuring and lease termination costs				1,545				288
(Income) loss from equity method investments, net				0		28,204		45,135
Amortization of deferred financing fees and debt discount				0		0		0
(Gain) loss from early extinguishment of debt				0		0		0
Gain on purchase of Gazelle (Note 3)				(989)
Goodwill impairment				85,890
Other				295		(548)		(2,951)
Equity in income (loss) of subsidiaries				(23,192)		14,378		11,037
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net				10,673		8,787		10,639
Content library				(11,951)		20,206		(23,357)
Prepaid expenses and other current assets				(7,599)		3,753		(6,280)
Other assets				(62)		1,558		400
Accounts payable				21,447		(65,737)		(408)
Accrued payable to retailers				(12,820)		(5,149)		1,633
Other accrued liabilities				11,337		1,988		(22,751)
Net Cash Provided by (Used in) Operating Activities				210,997	[2]	262,891	[3]	281,757	[4]
Investing Activities:
Purchases of property and equipment				(49,071)		(57,909)		(88,431)
Proceeds from sale of property and equipment				3,208		1,227		1,189
Acquisitions, net of cash acquired				(17,980)				0
Receipt of note receivable principal								0
Cash paid for equity investments						(24,500)		(28,000)
Extinguishment payment received from equity investment						5,000
Investments in and advances to affiliates				(145,721)		(178,406)		(156,659)
Net Cash Provided by (Used in) Investing Activities				(209,564)	[2]	(254,588)	[3]	(271,901)	[4]
Financing Activities:
Proceeds from issuance of senior unsecured notes						0		0
Proceeds from new borrowing on Credit Facility				0		0		0
Principal payments on Credit Facility				0		0		0
Settlement and conversion of convertible debt						0		0
Repurchases of common stock				0		0		0
Repurchase of Notes (Note 9)				0
Dividends paid				0
Principal payments on capital lease obligations and other debt				0		(3)		(217)
Financing costs associated with Credit Facility and senior unsecured notes				0		0		0
Windfall excess tax benefits related to share-based payments				0		0		0
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options				0		0		0
Net cash flows from (used in) financing activities				0	[2]	(3)	[3]	(217)	[4]
Effect of exchange rate changes on cash				0		0		0
Increase (decrease) in cash and cash equivalents				1,433		8,300		9,639
Cash and cash equivalents:
Beginning of period				17,939		9,639		0
End of period				19,372		17,939		9,639
Reportable Legal Entities | Combined Non-Guarantor Subsidiaries
Operating Activities:
Net income				23,192		(14,378)		(11,037)
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other				8,237		9,119		5,259
Amortization of intangible assets				44		0		0
Share-based payments expense				0		0		0
Windfall excess tax benefits related to share-based payments				0		0		0
Deferred income taxes				7,644		(5,683)		(4,434)
Impairment expense, restructuring and lease termination costs				0				0
(Income) loss from equity method investments, net				0		0		0
Amortization of deferred financing fees and debt discount				0		0		0
(Gain) loss from early extinguishment of debt				0		0		0
Gain on purchase of Gazelle (Note 3)				0
Goodwill impairment				0
Other				(728)		48		31
Equity in income (loss) of subsidiaries				0		0		0
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net				119		1,014		(1,517)
Content library				3,631		(495)		(195)
Prepaid expenses and other current assets				360		(297)		(500)
Other assets				158		69		(371)
Accounts payable				(2,188)		(158)		226
Accrued payable to retailers				94		198		460
Other accrued liabilities				(374)		161		(6)
Net Cash Provided by (Used in) Operating Activities				40,189	[2]	(10,402)	[3]	(12,084)	[4]
Investing Activities:
Purchases of property and equipment				(1,659)		(6,413)		(14,218)
Proceeds from sale of property and equipment				0		0		8
Acquisitions, net of cash acquired				0				0
Receipt of note receivable principal								0
Cash paid for equity investments						0		0
Extinguishment payment received from equity investment						0
Investments in and advances to affiliates				(41,817)		12,261		30,857
Net Cash Provided by (Used in) Investing Activities				(43,476)	[2]	5,848	[3]	16,647	[4]
Financing Activities:
Proceeds from issuance of senior unsecured notes						0		0
Proceeds from new borrowing on Credit Facility				0		0		0
Principal payments on Credit Facility				0		0		0
Settlement and conversion of convertible debt						0		0
Repurchases of common stock				0		0		0
Repurchase of Notes (Note 9)				0
Dividends paid				0
Principal payments on capital lease obligations and other debt				(400)		(441)		(417)
Financing costs associated with Credit Facility and senior unsecured notes				0		0		0
Windfall excess tax benefits related to share-based payments				0		0		0
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options				0		0		0
Net cash flows from (used in) financing activities				(400)	[2]	(441)	[3]	(417)	[4]
Effect of exchange rate changes on cash				2,829		2,315		1,643
Increase (decrease) in cash and cash equivalents				(858)		(2,680)		5,789
Cash and cash equivalents:
Beginning of period				43,868		46,548		40,759
End of period				43,010		43,868		46,548
Eliminations and Consolidation Reclassifications
Operating Activities:
Net income				(15,525)		(90,451)		(98,645)
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and other				0		0		0
Amortization of intangible assets				0		0		0
Share-based payments expense				0		0		0
Windfall excess tax benefits related to share-based payments				0		0		0
Deferred income taxes				0		0		0
Impairment expense, restructuring and lease termination costs				0				0
(Income) loss from equity method investments, net				0		0		0
Amortization of deferred financing fees and debt discount				0		0		0
(Gain) loss from early extinguishment of debt				0		0		0
Gain on purchase of Gazelle (Note 3)				0
Goodwill impairment				0
Other				0		0		54
Equity in income (loss) of subsidiaries				15,525		90,451		98,645
Cash flows from changes in operating assets and liabilities:
Accounts receivable, net				0		0		0
Content library				0		0		0
Prepaid expenses and other current assets				0		0		0
Other assets				0		0		0
Accounts payable				0		0		354
Accrued payable to retailers				0		0		0
Other accrued liabilities				0		0		0
Net Cash Provided by (Used in) Operating Activities				0	[2]	0	[3]	408	[4]
Investing Activities:
Purchases of property and equipment				0		0		0
Proceeds from sale of property and equipment				0		0		0
Acquisitions, net of cash acquired				0				0
Receipt of note receivable principal								0
Cash paid for equity investments						0		0
Extinguishment payment received from equity investment						0
Investments in and advances to affiliates				0		0		(54)
Net Cash Provided by (Used in) Investing Activities				0	[2]	0	[3]	(54)	[4]
Financing Activities:
Proceeds from issuance of senior unsecured notes						0		0
Proceeds from new borrowing on Credit Facility				0		0		0
Principal payments on Credit Facility				0		0		0
Settlement and conversion of convertible debt						0		0
Repurchases of common stock				0		0		0
Repurchase of Notes (Note 9)				0
Dividends paid				0
Principal payments on capital lease obligations and other debt				0		0		0
Financing costs associated with Credit Facility and senior unsecured notes				0		0		0
Windfall excess tax benefits related to share-based payments				0		0		0
Withholding tax paid on vesting of restricted stock net of proceeds from exercise of stock options				0		0		0
Net cash flows from (used in) financing activities				0	[2]	0	[3]	0	[4]
Effect of exchange rate changes on cash				0		0		0
Increase (decrease) in cash and cash equivalents				0		0		354
Cash and cash equivalents:
Beginning of period				0		0		(354)
End of period				$ 0		$ 0		$ 0

[1] The non-cash restructuring, impairment and related costs in 2015 of $2.1 million is composed of $7.4 million in impairments of lease related assets partially offset by a $5.3 million benefit resulting from the lease termination. The 2013 non-cash charge represents asset impairments of $32.7 million related to our four ventures previously included in our former New Ventures segment, Orango, Rubi, Crisp Market, and Star Studio, which were discontinued during 2013.

[2] During 2015 we discontinued our Redbox operations in Canada. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

[3] During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

[4] During the first quarter of 2015, we discontinued our Redbox operations in Canada and during 2013, we discontinued four ventures, Orango, Rubi, Crisp Market, and Star Studio. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

[5] The total cost of repurchases of common stock in 2014 was $545.1 million, which includes $3.7 million in fees and expenses relating to the tender offer recorded as part of the cost of treasury stock in our Consolidated Balance Sheets. The cash payments for the tender offer fees in 2014 were $3.7 million.

[6] Total financing costs associated with the Credit Facility and senior unsecured notes issued in 2014 were $8.2 million composed of non-cash debt issue costs of $4.5 million recorded as debt discount associated with our issuance of $300.0 million senior unsecured notes due 2021, $1.5 million in deferred financing fees associated with the senior unsecured notes, and $2.2 million in deferred financing fees associated with the refinancing of our Credit Facility. The cash payments for financing costs associated with the Credit Facility and senior unsecured notes in 2014 were $2.9 million.

[7] During 2015 we discontinued our Redbox operations in Canada. 2014 also includes the wind-down process of certain new ventures that were discontinued during 2013. Cash flows from these discontinued operations are not segregated from cash flows from continuing operations in all periods presented. See Note 12: Discontinued Operations for cash flow disclosures related to our discontinued Redbox operations in Canada.

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Income Taxes From Continuing Operations (Scheduling of Income from Continuing Operations Before Income Taxes) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Tax Disclosure [Abstract]
Components of income taxes, U.S. operations	$ 121,940	$ 188,473	$ 259,057
Components of income taxes, foreign operations	1,125	2,368	3,341
Income from continuing operations before income taxes	$ 123,065	$ 190,841	$ 262,398

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Income Taxes From Continuing Operations (Schedule of Components of Income Tax Expense Benefit) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Tax Disclosure [Abstract]
Current U.S. federal tax expense	$ 89,996	$ 69,117	$ 38,876
Current state and local tax expense	10,658	12,294	10,104
Current foreign tax expense (benefit)	469	415	(424)
Total current income tax expense	101,123	81,826	48,556
Deferred federal income tax benefit	(27,641)	(16,232)	(3,642)
Deferred state and local Income tax expense (benefit)	380	427	(5,653)
Deferred foreign income tax expense (benefit)	(243)	143	449
Total deferred income tax benefit	(27,504)	(15,662)	(8,846)
Income Tax Expense	$ 73,619	$ 66,164	$ 39,710

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Income Taxes From Continuing Operations (Schedule of Effective Income Tax Rate Reconciliation) (Details) - USD ($) $ in Thousands	3 Months Ended				12 Months Ended
	Jun. 30, 2015	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Tax Disclosure [Abstract]
U.S. Federal tax expense at statutory rates, percent					35.00%	35.00%	35.00%
State income taxes, net of federal benefit, percent					5.80%	4.10%	3.90%
Federal and state credits, percent					(1.60%)	(1.10%)	(0.90%)
Domestic production activities deduction, percent					(4.90%)	(3.60%)	(0.60%)
Goodwill impairment, percent					24.40%	0.00%	0.00%
Recognition of outside basis differences, percent					0.00%	(1.10%)	(15.40%)
ecoATM option payments, percent					0.20%	1.40%	0.70%
Valuation allowance, percent					0.20%	0.00%	2.30%
Acquisition of ecoATM, percent					0.00%	0.00%	(9.30%)
Other, percent					0.70%	0.00%	(0.60%)
Effective tax rate, percent					59.80%	34.70%	15.10%
Goodwill impairment (Note 6)	$ 85,900				$ 85,890	$ 0	$ 0
Tax benefit from recognition of outside basis difference		$ 16,700
Tax benefit from non-taxable gain remeasurement on equity interest			$ 24,300
Discrete one-time tax benefit				$ 17,800
Impact of tax benefit items, percent							22.40%
Undistributed earnings of foreign subsidiaries					$ 18,800

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Income Taxes From Continuing Operations (Schedule of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]
Balance, beginning of the year	$ 4,639	$ 2,781	$ 2,383
Additions based on tax positions related to the current year	1,837	1,836	824
Additions for tax positions related to prior years	527	806	18
Reductions for tax positions related to prior years	(118)	0	(257)
Reductions from lapse of applicable statute of limitations	0	(784)	(49)
Settlements	0	0	(138)
Balance, end of year	6,885	4,639	2,781
Income tax penalties and interest accrued	$ 300	$ 100	$ 0

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Income Taxes From Continuing Operations (Schedule of Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands	Dec. 31, 2015	Dec. 31, 2014
Deferred tax assets:
Income tax loss carryforwards	$ 3,015	$ 5,690
Capital loss carryforwards	4,759	5,930
Credit carryforwards	3,482	2,929
Accrued liabilities and allowances	27,188	22,652
Stock-based compensation	9,065	11,901
Intangible assets	13,109	17,166
Other	5,720	3,776
Gross deferred tax assets	66,338	70,044
Less: Valuation Allowance	(7,141)	(6,898)
Total deferred tax assets	59,197	63,146
Deferred tax liabilities:
Property and equipment	(42,984)	(68,417)
Product costs	(46,699)	(43,140)
Total deferred tax liabilities	(89,683)	(111,557)
Net deferred tax liabilities	$ (30,486)	$ (48,411)

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Income Taxes From Continuing Operations (Schedule of Deferred Tax Assets Valuation Allowance) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Income Tax Disclosure [Abstract]
Increase in valuation allowance	$ 243	$ 0	$ 6,898

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Income Taxes From Continuing Operations (Schedule of Operating Loss Carry Forwards) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014
Operating Loss Carryforwards [Line Items]
Deferred tax assets related to net operating loss carryforwards	$ 3,015	$ 5,690
Internal Revenue Service (IRS)
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	23
Deferred tax assets related to net operating loss carryforwards	8
State and Local Jurisdiction
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	24,570
Deferred tax assets related to net operating loss carryforwards	1,118
Foreign Tax Authority
Operating Loss Carryforwards [Line Items]
Net operating loss carryforwards	7,082
Deferred tax assets related to net operating loss carryforwards	$ 1,889
Minimum | Internal Revenue Service (IRS)
Operating Loss Carryforwards [Line Items]
Years that net operating loss carryforwards will expire between	Dec. 31, 2029
Minimum | State and Local Jurisdiction
Operating Loss Carryforwards [Line Items]
Years that net operating loss carryforwards will expire between	Dec. 31, 2017
Minimum | Foreign Tax Authority
Operating Loss Carryforwards [Line Items]
Years that net operating loss carryforwards will expire between	Dec. 31, 2033
Maximum | Internal Revenue Service (IRS)
Operating Loss Carryforwards [Line Items]
Years that net operating loss carryforwards will expire between	Dec. 31, 2034
Maximum | State and Local Jurisdiction
Operating Loss Carryforwards [Line Items]
Years that net operating loss carryforwards will expire between	Dec. 31, 2033
Maximum | Foreign Tax Authority
Operating Loss Carryforwards [Line Items]
Years that net operating loss carryforwards will expire between	Dec. 31, 2035

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Income Taxes From Continuing Operations (Schedule of Tax Credit Carry Forward) (Details) - State and Local Jurisdiction $ in Thousands	12 Months Ended
	Dec. 31, 2015 USD ($)
Tax Credit Carryforward [Line Items]
U.S. State Tax Credits	$ 3,482
Illinois
Tax Credit Carryforward [Line Items]
U.S. State Tax Credits	$ 2,894
Illinois | Minimum
Tax Credit Carryforward [Line Items]
U.S. State tax credits, expiration periods	Dec. 31, 2017
Illinois | Maximum
Tax Credit Carryforward [Line Items]
U.S. State tax credits, expiration periods	Dec. 31, 2021
California
Tax Credit Carryforward [Line Items]
U.S. State Tax Credits	$ 588

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Retirement Plans (Narrative) (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Compensation and Retirement Disclosure [Abstract]
Defined Contribution Plan, Contributions	$ 4.3	$ 4.3	$ 4.9

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Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				12 Months Ended
	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Dividends Payable [Line Items]
Dividends, date declared				Feb. 03, 2015
Dividends, date paid	Dec. 08, 2015	Sep. 15, 2015	Jun. 23, 2015	Mar. 18, 2015
Dividends paid					$ 21,347
Dividends, date of record				Mar. 03, 2015
Dividends declared per common share (in usd per share)	$ 0.30	$ 0.30	$ 0.30	$ 0.30	$ 1.20	$ 0	$ 0
Paid to recipients of unvested restricted stock awards
Dividends Payable [Line Items]
Dividends paid					$ 600

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Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Jan. 21, 2016
Subsequent Event [Line Items]
Estimated movie commitments		$ 448,718
Dividends, date declared					Feb. 03, 2015
Dividends, date paid		Dec. 08, 2015	Sep. 15, 2015	Jun. 23, 2015	Mar. 18, 2015
Dividends, date of record					Mar. 03, 2015
Subsequent Event
Subsequent Event [Line Items]
Estimated movie commitments						$ 640,500
Dividends, date declared	Feb. 03, 2016
Common Stock, Dividends, Per Share, Declared	$ 0.30
Dividends, date paid	Mar. 29, 2016
Dividends, date of record	Mar. 15, 2016