AMENDED AND RESTATED EMPLOYMENT AGREEMENT

Exhibit 10.3

AMENDED AND RESTATED

EMPLOYMENT AGREEMENT

COINSTAR, INC.
and
PAUL DAVIS

Dated as of April 1, 2009

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

     This Amended and Restated Employment Agreement (this “Agreement”), dated as of April 1, 2009, between Coinstar, Inc., a Delaware corporation (“Employer”), and Paul Davis (“Employee”);

W I T N E S S E T H:

     WHEREAS, Employer and Employee wish to document certain understandings and agreements; and

     WHEREAS, Employer desires to employ Employee upon the terms and conditions set forth herein; and

     WHEREAS, Employee is willing to provide services to Employer upon the terms and conditions set forth herein;

A G R E E M E N T S:

     NOW, THEREFORE, for and in consideration of the foregoing premises and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, Employer and Employee hereby agree as follows:

1. CHIEF EXECUTIVE OFFICER

      1.1 Employment

     Employer will employ Employee and Employee will provide services to Employer as its Chief Executive Officer (“CEO”).

      1.2 Attention and Effort

     Employee will devote all of his productive time, ability, attention and effort to Employer’s business and will skillfully serve its interests during the Term (as defined below).

      1.3 Term

     Employee’s term of employment as CEO under this Agreement shall begin as of the effective date of this Agreement and shall continue until terminated pursuant to Section 2 of this Agreement (the “Term”).

      1.4 Compensation

     During the Term, Employer agrees to pay or cause to be paid to Employee, and Employee agrees to accept in exchange for the services rendered hereunder by him, the following compensation:

      (a) Base Salary

     Employee’s compensation as CEO shall consist, in part, of an annual base salary of six hundred thousand dollars ($600,000) before all customary payroll deductions. Such annual base salary shall be paid in substantially equal installments and at the same intervals as other officers of Employer are paid. Employee’s salary shall be reviewed by Employer’s Compensation Committee as appropriate to determine in its discretion whether it is appropriate to increase the base salary.

      (b) Bonus

     Employee shall be eligible for cash bonuses consistent with the existing program for executive officers, provided performance targets applicable to such bonuses are met, and, provided further, any such bonus shall be pro-rated in the event of a termination without Cause.

      1.5 Benefits

     During the Term, Employee will be entitled to participate, subject to and in accordance with applicable eligibility requirements, in fringe benefit programs as shall be provided from time to time by, to the extent required, action of Employer’s Board of Directors.

2. TERMINATION

     Employment of Employee pursuant to this Agreement may be terminated as follows, but in any case, the provisions of Section 4 hereof shall survive the termination of this Agreement and the termination of Employee’s employment hereunder:

      2.1 By Employer

     With or without Cause (as defined below), Employer may terminate the employment of Employee at any time during the term of employment upon giving Notice of Termination (as defined below).

      2.2 By Employee

     Employee may terminate his employment at any time, for any reason, upon giving Notice of Termination.

      2.3 Automatic Termination

     This Agreement and Employee’s employment hereunder shall terminate automatically upon the death or total disability of Employee. The term “ total disability ” as used herein shall mean Employee’s inability to perform the duties set forth in Section 1 hereof for a period or periods aggregating 180 calendar days in any 12-month period as a result of physical or mental illness, loss of legal capacity or any other cause beyond Employee’s control, unless Employee is granted a leave of absence by the Employer. Employee and Employer hereby acknowledge that Employee’s ability to perform the duties specified in Section 1 hereof is of the essence of this Agreement. Termination hereunder shall be deemed to be effective (a) at the end of the calendar month in which Employee’s death occurs or (b) immediately upon a determination by the Employer of Employee’s total disability, as defined herein.

      2.4 Termination in Connection With a Change in Control

     Concurrent with the commencement of Employee’s employment hereunder as CEO, Employee and the Company shall enter into an Amended and Restated Change of Control Agreement, in the form attached hereto as Exhibit A. Notwithstanding Sections 3.1 and 3.2 of this Agreement and in full substitution therefor, if Employee’s employment terminates under circumstances described in the Amended and Restated Change of Control Agreement, Employee’s rights upon termination will be governed by the terms of the Amended and Restated Change of Control Agreement and his right to termination payments under this Employment Agreement shall cease.

      2.5 Notice

     The term “ Notice of Termination ” shall mean at least 30 days’ written notice of termination of Employee’s employment, during which period Employee’s employment and performance of services will continue; provided , however , that Employer may, upon notice to Employee and without reducing Employee’s compensation during such period, excuse Employee from any or all of his duties during such period. The effective date of the termination of Employee’s employment hereunder shall be the date on which such 30-day period expires.

3. TERMINATION PAYMENTS

     In the event of termination of the employment of Employee during the Term, all compensation and benefits set forth in this Agreement shall terminate except as specifically provided in this Section 3:

      3.1 Termination by Employer

     If Employer terminates Employee’s employment without Cause during the Term, Employee shall be entitled to receive (a) termination payments equal to twelve (12) months’ annual base salary, (b) any unpaid annual base salary which has accrued for services already performed as of the date termination of Employee’s employment becomes effective and (c) a

pro-rated cash bonus consistent with Section 1.4(b). All amounts payable pursuant to this Section 3.1 (or pursuant to Section 3.2) shall be reduced for applicable deductions and tax withholding. If, as a result of the termination of Employee’s employment without Cause, Employee and Employee’s spouse and dependent children are eligible for and timely (and properly) elect to continue coverage under Employer’s group health plan(s) in accordance with Code Section 4980B(f) (“COBRA”), Employer shall pay the premium for such coverage for a period of twelve (12) months following the date of Employee’s termination or until Employee is no longer entitled to COBRA continuation coverage under Employer’s group health plan(s), whichever period is the shorter. All other Employer benefits cease on the date of termination without Cause. If Employee is terminated by Employer for Cause during the Term, Employee shall not be entitled to receive any of the foregoing benefits, other than those set forth in Section 3.1(b) above.

      3.2 Termination by Employee

     In the case of the termination of Employee’s employment by Employee, Employee shall not be entitled to any payments hereunder, other than those set forth in Section 3.1(b) hereof if such termination occurs during the Term.

      3.3 Payment Schedule

     All amounts payable pursuant to Section 3.1(b) and 3.2 hereof shall be paid to Employee at the same time such amounts would have been paid to Employee had Employee’s employment not been terminated (or at such earlier time as is required by law). All amounts payable pursuant to Section 3.1(a) hereof shall be paid to Employee in twelve (12) equal monthly installments, beginning with the month following the month containing the date of Employee’s termination and continuing for eleven (11) consecutive months thereafter. For purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), each such installment shall be treated as a separate payment.

      3.4 Cause

     Wherever reference is made in this Agreement to termination being with or without Cause, “ Cause ” is limited to the occurrence of one or more of the following events:

     (a) Failure or refusal to carry out the lawful duties of Employee described in Section 1 hereof or any directions of the Board of Directors of Employer, which directions are reasonably consistent with the duties herein set forth to be performed by Employee;

     (b) Violation by Employee of a state or federal criminal law involving the commission of a crime against Employer or a felony;

     (c) Current use by Employee of illegal substances; deception, fraud, misrepresentation or dishonesty by Employee; any act or omission b