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)

6 Months Ended

Jun. 30, 2019

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

Schedule of 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 six month periods ended June 30, 2019 and 2018:


	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2019			2018			2019

	(Dollars in thousands)						(Dollars in thousands)
Stock option compensation expense included in unallocated corporate expenses	$	76		$	79		$	100		$	186
Restricted stock shares compensation expense included in unallocated corporate expenses		—			423			—			423
Stock option compensation expense included in broadcast operating expenses		29			29			42			68
Restricted stock shares compensation expense included in broadcast operating expenses		—			383			—			383
Stock option compensation expense included in digital media operating expenses		18			20			23			46
Stock option compensation expense included in publishing operating expenses		3			2			7			6

Total stock-based compensation expense, pre-tax	$	126		$	936		$	172		$	1,112

Tax expense for stock-based compensation expense		(33	)		(243	)		(45	)		(289	)

Total stock-based compensation expense, net of tax	$	93		$	693		$	127		$	823

Schedule of 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 using the Black-Scholes valuation model were as follows for the three and six month periods ended June 30, 2019 and 2018:


	Three Months Ended			Six Months Ended			Three Months Ended		Six Months Ended
	June 30, 2018			June 30, 2018			June 30, 2019		June 30, 2019
Expected volatility		41.82	%		41.84	%		n/a		47.54	%
Expected dividends		8.0	%		7.89	%		n/a		9.22	%
Expected term (in years)		7.4			7.4			n/a		7.5
Risk-free interest rate		2.95	%		2.93	%		n/a		2.61	%

Schedule of Stock Option Activity

Activity with respect to the Company’s option awards during the six month period ended June 30, 2019 is as follows:


Options	Shares			Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value

	(Dollars in thousands, except weighted average exercise price and weighted average grant date fair value)
Outstanding at January 1, 2019		1,980,972		$	4.63	$	2.61		4.1 years	$	—
Granted		5,000			2.82		1.43				—
Exercised		(200	)		2.38		2.05				—
Forfeited or expired		(159,625	)		6.39		4.50			$	2

Outstanding at June 30, 2019		1,826,147		$	4.49	$	2.46		3.9 years	$	3

Exercisable at June 30, 2019		1,289,269		$	4.88	$	2.77		2.8 years	$	3

Expected to Vest		509,766		$	4.51	$	2.47		3.9 years	$	3

Schedule of Information Regarding Restricted Stock Activity

Activity with respect to the Company’s restricted stock awards during the six month period ended June 30, 2019 is as follows:


Restricted Stock Awards	Shares			Weighted Average Grant Date Fair Value		Weighted Average Remaining Contractual Term		Aggregate Intrinsic Value

	(Dollars in thousands, except weighted average exercise price and weighted average grant date fair value)
Outstanding at January 1, 2019		—		$	—		—	$	—
Granted		389,061			2.07		—		806
Lapsed		(389,061	)		2.07		—		919
Forfeited		—			—		—		—

Outstanding at June 30, 2019		—		$	—		—	$	—