**1.3 Authority, Duties and Responsibilities**     During the Employment Period, the Employee’s authority, duties and responsibilitiesshall be at least reasonably commensurate in all material respects with the mostsignificant of those held, exercised and assigned at any time during the 90-day periodimmediately preceding the Effective Date.     **1.4 Employment Status**     If prior to the Effective Date the Employee’s employment with the Employer or its affiliatedcompanies terminates, then the Employee shall have no further rights under this Agreement.**2. ATTENTION AND EFFORT**     During the Employment Period, and excluding any periods of vacation and sick leave to whichthe Employee is entitled, the Employee will devote all of his professional productive time,ability, attention and effort to the business and affairs of the Employer and the discharge of theresponsibilities assigned to him hereunder, and will use his best efforts to perform faithfully andefficiently such responsibilities.**3. COMPENSATION**     During the Employment Period, the Employer agrees to pay or cause to be paid to the Employee,and the Employee agrees to accept in exchange for the services rendered hereunder by him, thefollowing compensation:     **3.1 Salary**     The Employee shall receive an annual base salary (the “Annual Base Salary”), at least equal tothe annual salary established by the Board prior to the Effective Date for the fiscal year in whichthe Effective Date occurs. The Annual Base Salary shall be paid in substantially equalinstallments and at the same intervals as the salaries of other officers of the Employer are paid.     **3.2 Bonus**     Employee may be entitled to receive, in addition to the Annual Base Salary, an annual bonus inan amount to be determined by the Board of Directors of the Employer in its sole discretion.     **3.3 Benefits**     During the Employment Period, the Employee shall be entitled to participate, subject to and inaccordance with applicable eligibility requirements, in such fringe benefit programs as shall beprovided to other executive employees of the Employer and its affiliated companies from time totime during the Employment Period by action of the Board (or any   PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -2-
 

 
person or committee appointed by the Board to determine fringe benefit programs and other emoluments).     **3.4 Expenses**     During the Employment Period, the Employee shall be entitled to receive prompt reimbursementfor all reasonable employment expenses incurred by him in accordance with the policies, practicesand procedures of the Employer and its affiliated companies in effect for the employees of theEmployer and its affiliated companies during the Employment Period or pursuant to an applicabletravel policy.**4. TERMINATION**     Employment of the Employee during the Employment Period may be terminated as follows but, inany case, the nondisclosure and noncompetition provisions set forth in Section 4 of the EmploymentAgreement shall survive the termination of this Agreement and the termination of the Employee’semployment with the Employer:     **4.1 By the Employer or the Employee**     Upon giving Notice of Termination (as defined below), the Employer may terminate theemployment of the Employee with or without Cause (as defined in the Employment Agreement), and theEmployee may terminate his employment for Good Reason (as defined below) or for any reason, at anytime during the Employment Period.     **4.2 Automatic Termination**     This Agreement and the Employee’s employment during the Employment Period shall terminateautomatically pursuant to Section 2.3 of the Employment Agreement upon the death or totaldisability of the Employee. The Employee and the Employer hereby acknowledge that the Employee’spresence and ability to perform the duties specified in Section 1.3 hereof is of the essence ofthis Agreement.     **4.3 Notice of Termination**     Any termination by the Employer or by the Employee during the Employment Period shall becommunicated by Notice of Termination to the other party given within 30 days in accordance withSection 2.5 of the Employment Agreement. The term “Notice of Termination” shall mean a writtennotice which (a) indicates the specific termination provision in this Agreement relied upon and(b) to the extent applicable, sets forth in reasonable detail the facts and circumstances claimedto provide a basis for termination of the Employee’s employment under the provision so indicated.The failure by the Employer to set forth in the Notice of Termination any fact or circumstancewhich contributes to a showing of Cause shall not waive any right of the Employer hereunder orpreclude the Employer from asserting such fact or circumstance in enforcing the Employer’s rightshereunder.   PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -3-
 

 
     **4.4 Date of Termination**     During the Employment Period, “Date of Termination” means (a) if the Employee’semployment is terminated by reason of death, at the end of the calendar month in which theEmployee’s death occurs, and (b) in all other cases, the later of (i) five days after thedate 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 ofSection 409A(a)(2)(A)(i) of the Internal Revenue Code of 1986, as amended (the “Code”).The Employee’s employment and performance of services will continue during such five-dayperiod; provided, however, that the Employer may, upon notice to theEmployee and without reducing the Employee’s compensation during such period, excuse theEmployee from any or all of his duties during such period.**5. TERMINATION PAYMENTS**     In the event of termination of the Employee’s employment during the Employment Period, allcompensation and benefits set forth in this Agreement shall terminate except as specificallyprovided in this Section 5. **5.1** **Termination by the Employer for Other Than Cause or by the Employeefor Good Reason**     If the Employer terminates the Employee’s employment other than for Cause or the Employeeterminates his employment for Good Reason prior to the end of the Employment Period, the Employeeshall be entitled to:          (a) Receive payment of the following accrued obligations (the “Accrued Obligations”):          (i) the Employee’s Annual Base Salary through the Date of Termination to the extentnot theretofore paid;          (ii) the product of (x) the Annual Bonus payable with respect to the fiscal year inwhich the Date of Termination occurs and (y) a fraction, the numerator of which is thenumber of days in the current fiscal year through the Date of Termination, and thedenominator of which is 365; and          (iii) any compensation previously deferred by the Employee (together with accruedinterest or earnings thereon, if any) as such deferred compensation becomes payable underthe deferral plan, and any accrued vacation pay, in each case to the extent not theretoforepaid; and          (b) an amount as separation pay equal to the Employee’s Annual Base Salary.   PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -4-
 

 
     **5.2 Termination for Cause or Other Than for Good Reason**     If the Employee’s employment shall be terminated by the Employer for Cause as defined in theEmployment Agreement or by the Employee for other than Good Reason during the Employment Period,this Agreement shall terminate without further obligation to the Employee other than the obligationto pay to the Employee his Annual Base Salary through the Date of Termination plus the amount ofany compensation previously deferred by the Employee (as such deferred compensation becomes payableunder the deferral plan), in each case to the extent theretofore unpaid.     **5.3 Termination Because of Death or Total Disability**     If the Employee’s employment is terminated by reason of the Employee’s death or totaldisability during the Employment Period, this Agreement shall terminate automatically withoutfurther obligations to the Employee or his legal representatives under this Agreement, other thanfor payment of Accrued Obligations (which shall be paid to the Employee’s estate or beneficiary, asapplicable in the case of the Employee’s death).     **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 wasdeferred) shall be paid to the Employee in a lump sum in cash within 30 days of the Date ofTermination. Payments under Section 5.1(b) shall be paid to Employee in twelve (12) equal monthlyinstallments, beginning with the month following the month containing the Date of Termination andcontinuing for eleven (11) consecutive months thereafter. For purposes of Code Section 409A, eachinstallment payable pursuant to Section 5.1(b) and this Section 5.4 shall be treated as a separatepayment.     **5.5 Good Reason**          (a) For purposes of this Agreement, subject to Section 5.5(b), “Good Reason” means theoccurrence or existence of any of the following events or conditions without the Employee’s expresswritten consent:          (i) A diminution in the Employee’s Annual Base Salary;          (ii) A diminution in the Employee’s authority, duties or responsibilities ascontemplated by Section 1.3 hereof, excluding for this purpose reasonable changes inparticular duties and reporting responsibilities which may result from the Employerbecoming part of a larger business organization at some future time provided that suchchanges in the aggregate do not result in a material alteration in the Employee’sauthority, duties or responsibilities;          (iii) Any failure by the Employer to comply with and satisfy Section 7 of theEmployment Agreement, provided that the Employer’s successor has   PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -5-
 

 
received at least ten days’ prior written notice from the Employer or the Employee ofthe requirements of Section 7 thereof;          (iv) A relocation of the Employee’s principal place of employment to a location morethan 50 miles from the Seattle metropolitan area, except for required travel on theEmployer’s business to an extent substantially consistent with the Employee’s duties andresponsibilities; or          (v) Any other action or inaction by the Employer that constitutes a material breach bythe Employer of this Agreement or the Employment Agreement.     (b) Notwithstanding any provision in this Agreement to the contrary, termination of employmentby the Employee will not be for Good Reason unless (i) the Employee notifies the Employer inwriting of the occurrence or existence of the event or condition which the Employee believesconstitutes Good Reason within 90 days of the occurrence or initial existence of such event orcondition (which notice specifically identifies such event or condition), (ii) the Employer failsto 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 afterthe expiration of the Remedial Period and before the Employer remedies such event or condition. Ifthe Employee terminates employment before the expiration of the Remedial Period or after theEmployer remedies the event or condition (even if after the end of the Remedial Period), then theEmployee’s termination will not be considered to be for Good Reason.     **6. REPRESENTATIONS, WARRANTIES AND OTHER CONDITIONS**     In order to induce the Employer to enter into this Agreement, the Employee represents andwarrants to the Employer as follows:     **6.1 No Violation of Other Agreements**     The Employee represents that neither the execution nor the performance of this Agreement bythe Employee will violate or conflict in any way with any other agreement by which the Employee maybe bound.     **6.2 Reaffirmation of Obligations**     The Employee hereby acknowledges and reaffirms the Employee Proprietary Information andInventions Agreement previously executed by Employee on the date hereof and Employee’s obligationsunder Section 4 of the Employment Agreement.     **7. CODE SECTION 409A**     The Employer makes no representations or warranties to Employee with respect to any tax,economic or legal consequences of this Agreement or any payments or other benefits providedhereunder, including without limitation under Code Section 409A, and no provision   PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -6-
 

 
of this Agreement shall be interpreted or construed to transfer any liability for failure tocomply with Code Section 409A or any other legal requirement from Employee or any other person tothe Employer, any of its affiliates or any other person. Employee, by executing this Agreement,shall be deemed to have waived any claim against the Employer, its affiliates and any other personwith respect to any such tax, economic or legal consequences. However, the parties intend thatthis Agreement and the payments and other benefits provided hereunder shall be exempt from therequirements of Code Section 409A to the maximum extent possible, whether pursuant to theshort-term deferral exception described in Treasury Regulation Section 1.409A-1(b)(4), theinvoluntary separation pay plan exception described in Treasury RegulationSection 1.409A-1(b)(9)(iii), or otherwise. To the extent Code Section 409A is applicable to thisAgreement (and such payments and benefits), the parties intend that this Agreement (and suchpayments and benefits) shall comply with the deferral, payout and other limitations andrestrictions imposed under Code Section 409A. Notwithstanding any other provision of thisAgreement to the contrary, this Agreement shall be interpreted, operated and administered in amanner consistent with such intentions. Without limiting the generality of the foregoing, andnotwithstanding any other provision of this Agreement to the contrary, with respect to any paymentsand benefits under this Agreement to which Code Section 409A applies, all references in thisAgreement to termination of Employee’s employment are intended to mean Employee’s “separation fromservice,” within the meaning of Code Section 409A(a)(2)(A)(i). In addition, if Employee is a“specified employee,” within the meaning of Code Section 409A(a)(2)(B)(i), when Employee separatesfrom service, within the meaning of Code Section 409A(a)(2)(A)(i), then to the extent necessary toavoid subjecting Employee to the imposition of any additional tax under Code Section 409A, amountsthat would otherwise be payable under this Agreement during the six-month period immediatelyfollowing Employee’s separation from service shall not be paid to Employee during such period, butshall instead be accumulated and paid to Employee (or, in the event of Employee’s death, Employee’sestate) in a lump sum on the first business day following the earlier of (a) the date that is sixmonths after Employee’s separation from service or (b) Employee’s death.   PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -7-
 

 
     IN WITNESS WHEREOF, the parties have executed and entered into this Agreement on the date setforth above.           **EMPLOYEE**                  /s/ Paul Davis         **Paul Davis**             **COINSTAR, INC.**             By /s/ Donald Rench             Its Secretary      PAUL DAVIS AMENDED & RESTATED CHANGE OF CONTROL AGREEMENT 4-1-09 -8-
 

 
**APPENDIX A TO****AMENDED AND RESTATED CHANGE OF CONTROL**