Exhibit 10.26
FORM OF FIRST AMENDMENT TO
CHANGE OF CONTROL AGREEMENT
     This First Amendment (this “Amendment”) to the Change of Control Agreement
(the “Change of Control Agreement”), dated as of                     , between
Coinstar, Inc., a Delaware corporation (“Employer”), and                     
(“Employee”) is entered into on                     , 2008.
     WHEREAS, Employer and Employee wish to document an amendment to the Change
of Control Agreement;
     NOW, THEREFORE, for good and valuable consideration, the sufficiency and
receipt of which are hereby acknowledged, Employer and Employee hereby agree
that, effective January 1, 2009, the Change of Control Agreement shall be
amended as follows:
     1. Section 1.3 is amended to read as follows:
     1.3 Duties, Authority and Responsibility
     During the Employment Period, the Employee’s authority, duties and
responsibilities shall be at least reasonably commensurate in all material
respects with the most significant of those held, exercised and assigned at any
time during the 90-day period immediately preceding the Effective Date.
     2. Section 4.4 is amended to read as follows:
     4.4 Date of Termination
     During the Employment Period, “Date of Termination” means (a) if the
Employee’s employment is terminated by reason of death, the end of the calendar
month in which the Employee’s death occurs, and (b) in all other cases, the
later of (i) five days after the date of personal delivery of or mailing of, as
applicable, the Notice of Termination, and (ii) the date on which the Employee
separates from service, within the meaning of Section 409A(a)(2)(A)(i) of the
Internal Revenue Code of 1986, as a mended (the “Code”). The Employee’s
employment and performance of services will continue during such five-day
period; provided, however, that the Employer may, upon notice to the Employee
and without reducing the Employee’s compensation during such period, excuse the
Employee from any or all of his duties during such period.
     3. Section 5.1(c) is amended to read as follows:
(c) If, as a result of the termination of the Employee’s employment, the
Employee and the Employee’s spouse and dependent children are eligible for and
timely (and properly) elect to continue coverage under the Employer’s group
health plan(s) in

 

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accordance with Code Section 4980B(f) (“COBRA”), the Employer shall pay the
premium for such coverage for a period of twelve (12) months following the Date
of Termination or until the Employee is no longer entitled to COBRA continuation
coverage under the Employer’s group health plan(s), whichever period is the
shorter.
     4. Section 5.4 is amended to read as follows:
     5.4 Payment Schedule
     Payments under Section 5.1(a), 5.2 and 5.3 (other than payments of deferred
compensation, which shall be paid in accordance with the provisions of the plan
under which such compensation was deferred) shall be paid to the Employee in a
lump-sum in cash within 30 days of the Date of Termination. Payments under
Section 5.1(b) shall be paid to the Employee in twelve (12) equal monthly
installments, beginning with the month following the month containing the Date
of Termination and continuing for eleven (11) consecutive months thereafter. For
purposes of Code Section 409A, each installment payable pursuant to
Section 5.1(b) and this Section 5.4 shall be treated as a separate payment.
     5. Section 5.5 is amended to read as follows:
     5.5 Good Reason
     (a) For purposes of this Agreement, subject to Section 5.5(b), “Good
Reason” means the occurrence of any of the following events or conditions
without the Employee’s express written consent:
     (i) A diminution in the Employee’s Annual Base Salary;
     (ii) A diminution in the Employee’s authority, duties or responsibilities
as contemplated by Section 1.3 hereof, excluding for this purpose reasonable
changes in particular duties and reporting responsibilities which may result
from the Employer becoming part of a larger business organization at some future
time provided that such changes in the aggregate do not result in a material
alteration in the Employee’s authority, duties or responsibilities;
     (iii) A relocation of the Employee’s principal place of employment to a
location more than 50 miles from the Seattle metropolitan area, , except for
required travel on the Employer’s business to an extent substantially consistent
with the Employee’s duties and responsibilities; or

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     (iv) Any other action or inaction by the Employer that constitutes a
material breach by the Employer of this Agreement.
     (b) Notwithstanding any provision in this Agreement to the contrary,
termination of employment by the Employee will not be for Good Reason unless
(i) the Employee notifies the Employer in writing of the occurrence or existence
of the event or condition which the Employee believes constitutes good Reason
within 90 days of the occurrence or initial existence of such event or condition
(which notice specifically identifies such event or condition), (ii) the
Employer fails to remedy such event or condition within 30 days after the date
on which it receives such notice (the “Remedial Period”), and (iii) the Employee
actually terminates employment within 90 days after the expiration of the
Remedial Period and before the Employer remedies such event or condition. If the
Employee terminates employment before the expiration of the Remedial Period or
after the Employer remedies the event or condition (even if after the end of the
Remedial Period), then the Employee’s termination will not be considered to be
for Good Reason.
     6. Section 7 is amended to read as follows:
     7. SECTION 409A COMPLIANCE
     The Employer makes no representations or warranties to the Employee with
respect to any tax, economic or legal consequences of this Agreement or any
payments or other benefits provided hereunder, including without limitation
under Code Section 409A, and no provision of this Agreement shall be interpreted
or construed to transfer any liability for failure to comply with Code
Section 409A or any other legal requirement from the Employee or any other
person to the Employer, any of its affiliates or any other person. The Employee,
by executing this Agreement, shall be deemed to have waived any claim against
the Employer, its affiliates and any other person with respect to any such tax,
economic or legal consequences. However, the parties intend that this Agreement
and the payments and other benefits provided hereunder shall be exempt from the
requirements of Code Section 409A to the maximum extent possible, whether
pursuant to the short-term deferral exception described in Treasury
Regulation Section 1.409A-1(b)(4), the involuntary separation pay plan exception
described in Treasury Regulation Section 1.409A-1(b)(9)(iii), or otherwise. To
the extent Code Section 409A is applicable to this Agreement (and such payments
and benefits), the parties intend that this Agreement (and such payments and
benefits) shall comply with the deferral, payout and other limitations and
restrictions imposed under Code Section 409A. Notwithstanding any other
provision of this Agreement to the contrary, this Agreement shall be
interpreted, operated and administered in a manner consistent with such
intentions. Without

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limiting the generality of the foregoing, and notwithstanding any other
provision of this Agreement to the contrary, with respect to any payments and
benefits under this Agreement to which Code Section 409A applies, all references
in this Agreement to termination of the Employee’s employment are intended to
mean the Employee’s “separation from service,” within the meaning of Code
Section 409A(a)(2)(A)(i). In addition, if the Employee is a “specified
employee,” within the meaning of Code Section 409A(a)(2)(B)(i), when the
Employee separates from service, within the meaning of Code
Section 409A(a)(2)(A)(i), then to the extent necessary to avoid subjecting the
Employee to the imposition of any additional tax under Code Section 409A,
amounts that would otherwise be payable under this Agreement during the
six-month period immediately following the Employee’s separation from service
shall not be paid to the Employee during such period, but shall instead be
accumulated and paid to the Employee (or, in the event of the Employee’s death,
the Employee’s estate) in a lump sum on the first business day following the
earlier of (a) the date that is six months after the Employee’s separation from
service or (b) the Employee’s death.
     IN WITNESS WHEREOF, the parties have executed and entered into this
Amendment on the date set forth above.

                  COINSTAR, INC.    
 
           
 
  By        
 
           
[Employee]
  Its        
 
           

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