Salem Media Group, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

STOCK OPTION PLAN (Tables)

STOCK OPTION PLAN (Tables)

12 Months Ended

Dec. 31, 2012

Stock-Based Compensation Expense Recognized

The following table reflects the components of stock-based compensation expense recognized in the Consolidated Statements of Operations for the years ended December 31, 2010, 2011 and 2012:


	Year Ended December 31,
	2010			2011			2012
	(Dollars in thousands)
Stock option compensation expense included in corporate expenses	$	947		$	603		$	933
Restricted stock shares compensation expense included in corporate expenses		17			4			—
Stock option compensation expense included in broadcast operating expenses		380			281			305
Stock option compensation expense included in Internet operating expenses		79			52			111
Stock option compensation expense included in publishing operating expenses		14			10			19

Total stock-based compensation expense, pre-tax	$	1,437		$	950		$	1,368

Tax benefit (expense) from stock-based compensation expense		(792	)		(220	)		(579	)

Total stock-based compensation expense, net of tax	$	645		$	730		$	789

Weighted-Average Assumptions Used to Estimate Fair Value of Stock Options using Black-Scholes Option Valuation Model

The weighted-average assumptions used to estimate the fair value of the stock options using the Black-Scholes option valuation model were as follows for the years ended December 31, 2010, 2011 and 2012:


	Year Ended December 31,
	2010			2011			2012
Expected volatility		94.26	%		101.49	%		102.37	%
Expected dividends		0.0	%		0.0	%		5.07	%
Expected term (in years)		7.3			7.5			8.2
Risk-free interest rate		3.11	%		1.64	%		1.66	%

Stock Option

Stock option information with respect to the company’s stock-based compensation plans during the three years ended December 31, 2012 is as follows (Dollars in thousands, except weighted average exercise price and weighted average grant date fair value):


Options	Shares			Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at January 1, 2010		1,341,875		$	5.01	$	3.80		5.0 years	$	4,762
Granted		430,500			5.20		4.32				—
Exercised		(557,451	)		0.61		0.41				1,718
Forfeited or expired		(62,926	)		11.88		8.79				—

Outstanding at December 31, 2010		1,151,998		$	6.83	$	5.36		5.0 years	$	748

Exercisable at December 31, 2010		560,151		$	8.79	$	5.73		3.3 years	$	554

Expected to Vest		561,959		$	4.97	$	5.01		6.5 years	$	184
Outstanding at January 1, 2011		1,151,998		$	6.83	$	5.36		5.0 years	$	748
Granted		630,000			2.43		2.05				116
Exercised		(41,112	)		0.59		0.42				125
Forfeited or expired		(100,494	)		11.47		7.72				22

Outstanding at December 31, 2011		1,640,392		$	5.01	$	4.07		5.2 years	$	584

Exercisable at December 31, 2011		655,228			7.56		5.47		2.9 years		414

Expected to Vest		980,189		$	3.31	$	3.13		6.8 years	$	170
Outstanding at January 1, 2012		1,640,392		$	5.01	$	4.07		5.2 years	$	584
Granted		626,000			2.74		1.51				1,704
Exercised		(261,205	)		1.57		1.28				910
Forfeited or expired		(78,088	)		14.06		8.03				10,824

Outstanding at December 31, 2012		1,927,099		$	4.37	$	3.45		5.4 years	$	3,899

Exercisable at December 31, 2012		707,024			6.58		5.41		2.9 years		1,004

Expected to Vest		1,158,461		$	3.09	$	2.32		6.8 years	$	2,749

Information Regarding Restricted Stock

Information regarding the company’s restricted stock during the years ended December 31, 2010 and 2011 is as follows:


Restricted Stock	Shares			Weighted Average Grant Date Fair Value
Non-Vested at January 1, 2010		5,000		$	0.36
Granted		10,000			2.03
Lapsed		(5,000	)		0.36
Forfeited		—

Non-Vested at December 31, 2010		10,000		$	2.03

Non-Vested at January 1, 2011		10,000		$	2.03
Granted
Lapsed		(10,000	)		2.03
Forfeited		—

Non-Vested at December 31, 2011		—		$	—

Additional Information Regarding Options Outstanding

Additional information regarding options outstanding as of December 31, 2012, is as follows:


Range of Exercise Prices	Options		Weighted Average Contractual Life Remaining (Years)		Weighted Average Exercise Price		Exercisable Options		Weighted Average Exercise Price
$ 0.36 - $ 3.00		1,206,024		6.5	$	2.40		223,399	$	1.48
$ 3.01 - $ 6.00		500,750		4.6		5.07		263,300		5.05
$ 6.01 - $ 9.00		1,500		2.4		7.99		1,500		7.99
$ 9.01 - $ 12.00		93,400		1.7		11.80		93,400		11.80
$ 12.01 - $ 15.00		87,775		1.4		13.89		87,775		13.89
$ 15.01 - $ 18.00		27,750		0.9		16.75		27,750		16.75
$ 18.01 - $ 21.00		9,250		1.4		18.89		9,250		18.89
$ 21.01 - $ 24.00		—		—		—		—
$ 24.01 - $ 25.50		650		0.7		24.78		650		24.78

$ 0.36 - $ 25.50		1,927,099		5.4	$	4.37		707,024	$	6.58

- Definition

Tabular disclosure of the allocation of equity-based compensation costs to a given line item on the balance sheet and income statement for the period. This may include the reporting line for the costs and the amount capitalized and expensed.

+ References + Details

- Definition

Tabular disclosure of option exercise prices, by grouped ranges, including the upper and lower limits of the price range, the number of shares under option, weighted average exercise price and remaining contractual option terms.

+ References + Details