Salem Media Group, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

STOCK INCENTIVE PLAN (Tables)

STOCK INCENTIVE PLAN (Tables)

9 Months Ended

Sep. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Compensation Expense Recognized

The following table reflects the components of stock-based compensation expense recognized in the Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2013 and 2014:


	Three Months Ended September 30,						Nine Months Ended September 30,
	2013			2014			2013			2014
	(Dollars in thousands)
Stock option compensation expense included in Corporate expenses	$	243		$	223		$	555		$	843
Restricted stock shares compensation expense included in Corporate expenses		—			—			481			—
Stock option compensation expense included in Broadcast operating expenses		43			64			260			253
Stock option compensation expense included in Internet operating expenses		62			40			195			134
Stock option compensation expense included in Publishing operating expenses		10			17			38			46

Total stock-based compensation expense, pre-tax	$	358		$	344		$	1,529		$	1,276
Tax provision for stock-based compensation expense		(143	)		(137	)		(611	)		(510	)

Total stock-based compensation expense, net of tax	$	215		$	207		$	918		$	766

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

The weighted-average assumptions used to estimate the fair value of the stock options and restricted stock awards using the Black-Scholes valuation model were as follows for the three and nine months ended September 30, 2013 and 2014:

Three Months Ended
September 30,

Nine Months Ended
September 30,

2013

2014

2013

2014

Expected volatility

n/a

100.78

74.98

Expected dividends

n/a

2.05

2.70

Expected term (in years)

n/a

6.6

7.8

Risk-free interest rate

n/a

1.06

2.27

Stock Option

Stock option information with respect to the company’s stock-based equity plans during the nine months ended September 30, 2014 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, 2014		2,162,067		$	5.09	$	3.57	5.5 years	$	8,491
Granted		25,000		$	8.40	$	4.73		$	—
Exercised		(227,337	)	$	4.82	$	3.74		$	977
Forfeited or expired		(72,401	)	$	13.30	$	8.52		$	11

Outstanding at September 30, 2014		1,887,329		$	4.85	$	3.38	5.1 years	$	5,652

Exercisable at September 30, 2014		695,459		$	5.18	$	3.80	3.4 years	$	2,110

Expected to Vest		1,131,684		$	4.66	$	3.13	6.1 years	$	3,363