The destruction of value cannot be attributed to Mr. Fernandes during his tenure on the Board. Blockbuster has had a very strong Board during this time horizon, including well-known shareholder activist Carl Icahn, and a significant amount of the value loss can be attributed to the Company’s debt obligations, much of which was placed on Blockbuster in connection with its spin-off from Viacom Inc. In addition the rumors of bankruptcy begun in March 2009 and continuing today have dramatically depressed the Company’s stock price and the stock has never recovered.

The Hemscott Index, Blockbuster’s barometer for share performance, does not include Movie Gallery, which recently announced plans to liquidate. Including the performance of their shares in this index would likely reflect a similar trend to Blockbuster’s. The secular shifts in the home entertainment business are severe and rapidly evolving, and Blockbuster has been equally impacted by these changes.

Although the Company twice lowered earnings projections for 2009, the Company has publicly explained the factors that contributed to shortfalls (advertising and inventory investment on the 28-day window that competition was able to circumvent).

The current management team does not have a history of underperforming guidance. In 2008, earnings were at the top end of the guidance range.

Meyer’s measure of Blockbuster’s business, subscribers, is a mistaken metric. When the Company had its peak number of subscribers, we lost over $150 million in EBITDA from those operations. Despite the current reduced subscriber count, we project to make over $50 million. This swing in profitability reflects efforts over the last 2.5 years to improve the operations of the business and creation of a solid financial base. We have active plans to grow the subscriber base meaningfully in the near term, including a number of unannounced partnerships.

If Meyer wants to grow subscribers at all costs, then he is the wrong candidate to represent the shareholders.

We have partnered with NCR to enter the automated retail (aka vending) business. NCR brings a strong balance sheet to invest in a capital-intensive start-up business, and has had very positive traction with retailers nationally.

Blockbuster has actively won accounts from its primary competition, Redbox, and expects to continue to win more accounts in the future.

Blockbuster Express is the fastest-growing kiosk business ever, reaching over 4000 kiosks in under 18 months.

Meyer’s own company never exceeded 1000 units. In fact, we have heard rumors that Coinstar is looking to jettison Meyer’s former business, which does not seem to be a ringing endorsement of his abilities and strategies.

Our strategy is not a bricks-and-mortar strategy, as Meyer calls it, but rather a multi-channel strategy that seeks to address consumer needs across various use occasions and availability.

As a director at the largest home entertainment company in the world over the last 5 years, Mr. Fernandes has significant home entertainment experience.

If Meyer was such an expert in the home entertainment industry, why is he no longer employed by Coinstar? Why have no other companies used his consulting services?

According to their proxy filings, these are the breakdowns of comparable company boards, including companies that are well-regarding for being forward thinking (Apple, Google)

Apple – 7 directors (0 under 50, avg age of 62)

Google – 9 directors (3 under 50, avg age of 52)

Netflix – 7 directors (3 under 50, avg age of 51)

Coinstar – 7 directors (2 under 50, avg age of 54)

Gamestop – 11 directors (0 under 50, avg age of 64)

Wal-mart – 16 directors (2 under 50, avg age of 59)

Blockbuster – 7 directors (0 under 50, avg age of 62