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Subsequent Events
9 Months Ended
Sep. 30, 2014
Subsequent Events [Abstract]  
Subsequent Events [Text Block]
Note 20: Subsequent Events
Withdrawal from Joint Venture with Verizon
On October 19, 2014, Redbox, Verizon, the Joint Venture and Verizon Corporate Services Group, Inc. entered into a Withdrawal and Extinguishment of Rights Agreement (the “Withdrawal Agreement”) pursuant to which Redbox withdrew as a member of the Joint Venture effective on October 20, 2014. As previously announced, Redbox Instant by Verizon, the business operated by the Joint Venture, ceased operation of its consumer service effective October 7, 2014.
Pursuant to the Withdrawal Agreement, all of Redbox’s rights under the Joint Venture’s operating agreement will be extinguished and all outstanding amounts including expense reimbursements will be settled in exchange for a total payment of $16.8 million to Redbox. To date, Outerwall has made total cash capital contributions to the Joint Venture of $77.0 million and has received total cash from the Joint Venture of $70.5 million, inclusive of revenue attributable to the rental of DVDs and Blu-ray Discs through the Joint Venture and the $16.8 million payment. In addition, Outerwall realized approximately $29.9 million in cash tax savings through deductions arising from the recognition of our share of the Joint Venture’s losses through September 30, 2014.
Outerwall does not expect a net material financial impact resulting from the extinguishment and expense reimbursement. Neither Redbox nor Outerwall will take part in any material manner with the Joint Venture or in the winding down of Redbox Instant by Verizon following the withdrawal.
Content License Agreement
On October 27, 2014, we entered into an Amended and Restated Home Video Lease Output Agreement (the “Letter Agreement”) with Lions Gate Films, Inc. (“Lionsgate”). The Letter Agreement extends the term of Redbox’s arrangement to license theatrical and direct-to-video titles released by Lionsgate through September 30, 2016, which will be automatically extended for an additional year under certain conditions. After accounting for this agreement, our commitment to purchase content from Lionsgate was approximately $111.6 million.