##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
  Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31, 2008oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission file number:
    000-17287
  OUTDOOR CHANNEL HOLDINGS,
    INC.
 (Exact name of registrant as
    specified in its charter)
  Delaware(State or other jurisdiction
    of
    incorporation or organization)

33-0074499(I.R.S. Employer
    Identification No.)   43445 Business Park Dr., Suite 103, Temecula, California
    92590 (Address of principal
    executive offices) (Zip Code)
  Registrants telephone number, including area code:
 (951) 699-6991
  Securities
    registered pursuant to Section 12 (b) of the
    Act:
   Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $0.001 par value

The Nasdaq Global Market  Securities registered pursuant to Section 12 (g) of
    the Act:
 None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
  12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE




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##### 





OUTDOOR
    CHANNEL HOLDINGS, INC.
  FORM 10-K
  TABLE OF
    CONTENTS
   
 PART IItem 1.

Business


3Item 1A.

Risk Factors


14Item 1B.

Unresolved Staff Comments


24Item 2.

Properties


25Item 3.

Legal Proceedings


25Item 4.

Submission of Matters to a Vote of Security
    Holders


25PART IIItem 5.

Market for the Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


25Item 6.

Selected Financial Data


27Item 7.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


28Item 7A.

Quantitative and Qualitative Disclosures About
    Market Risk


42Item 8.

Financial Statements and Supplementary Data


44Item 9.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


75Item 9A.

Controls and Procedures


75Item 9B.

Other Information


77PART IIIItem 10.

Directors, Executive Officers and Corporate
    Governance


77Item 11.

Executive Compensation


77Item 12.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


77Item 13.

Certain Relationships and Related Transactions,
    and Director Independence


77Item 14.

Principal Accountant Fees and Services


77PART IVItem 15.

Exhibits and Financial Statement Schedules


78SIGNATURES


81EX-10.34EX-21.1EX-23.1EX-23.2EX-31.1EX-31.2EX-32.1EX-32.2   2




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##### Table of Contents



PART I  ITEM 1.
    BUSINESS.  Form 10-K,
  Forward-Looking
    Statements
    Form 10-K
  Company
    Overview
  ®
    
    inherent errors in Nielsens statistical methodology; 3




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
    a two to four month delay in the reporting of the number of
    subscribers on which the service provider is paying the network;
    service providers paying a network on a lower number of
    subscribers than those actually subscribing to the network
    because of special arrangements they have made with various
    groups of subscribers, for example, a service provider may agree
    to charge an apartment complex for only 100 units in a
    150 unit complex; Nielsens estimate theoretically
    includes the entire 150 households, but the service provider
    only reports 100 subscribing households; and
    theft of a service providers television service; again,
    Nielsen should include these households in its estimate, but the
    service provider would not report such household as a subscriber.      2008
    Developments
    
    Programming;
    Ratings;
    Ad Sales;
    Conservation and Affinity Organizations; and
    Digital Media.  Programming
    Ratings
   4




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##### Table of Contents



Ad
    Sales
    Conservation
    and Affinity Organizations
    Digital
    Media
  Video-on-Demand.
  Industry
        Service Providers.
  Cable Systems.
 5




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Satellite Systems. ® tm
  Networks.
    Trends
    in Pay Television
  Transition from Analog to Digital in Cable
    Systems. pay-per-view, video-on-demand
  Emergence of High Definition
    Television.
 6




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Channel Proliferation.
  Focused and Segmented Advertising.
  Our
    Competitive Strengths
    Authentic,
    Informative and Entertaining Outdoor Programming
    Attractive
    Viewer Demographics
    Large
    Outdoor-Focused Market
   7




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Extensive
    Service Provider Relationships
    Highly
    Leverageable Business Model
    Experienced
    and Committed Management Team
    Our
    Business Growth Strategies
    Seek
    to Grow Our Subscriber Base
    
    Expand distribution relationships.  We
    intend to expand our marketing and sales efforts to grow our
    subscriber base. Through our existing relationships with
    carriers, we intend to offer service providers incentives to
    migrate our channel from premium packages to more affordable
    basic or expanded basic service packages with a greater number
    of subscribers. In addition, we plan to continue to pursue
    agreements with additional service providers. The incentives we
    intend to offer to service providers may include, but are not
    limited to, the following:  
    overall per subscriber rate reduction;
    enhanced penetration discounts;
    commitments to purchase cross channel promotion spots from the
    systems advertising inventory;
    upfront payments to service providers, in the form of cash or
    our securities;
    local marketing support, such as promotional materials and
    sharing of costs for local advertising; and
    training support for customer service representatives.  
    Adopt HD technology.  We believe that HD
    television complements our outdoor-themed content. The audio and
    visual characteristics of HD substantially enhance the
    experience and sense of adventure provided by 8




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our programming. As a validation of the high quality, visually
    compelling nature of our HD programming, through an arrangement
    with Premier Retail Networks, Inc., we provide branded HD
    content being used to promote the sales of HD television sets in
    well known retail stores, such as Wal-Mart, Circuit City and
    Best Buy. We are ready to assist service providers as they
    migrate their offerings to HD TV by providing quality HD TV
    programming.  Refocus
    Marketing Efforts
    Increase
    Advertising Sales Efforts
        Upgrade
    Quality of Programming
    Create
    and Acquire More of Our Own Programs
   9




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Establish
    Digital Media Presence
    Sources
    of Revenue
    Advertising
    Fees
    Short-form Advertising.
          Long-form Advertising.
  Subscriber
    Fees
   10




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Programming
      Sales and
    Marketing
    Service
    Providers
    Consumers
     11




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Outdoor Life Field and
  Advertisers
    Segment
    Information
    Competition
            Employees
   12




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Recent
    Events
    Government
    Regulation
    Local
    Cable Regulation
    Federal
    Cable Regulation
       13




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Other
    Regulations
    Intellectual
    Property
  ®
  Available
    Information
  1-800-SEC-0330 http://www.sec.gov http://www.outdoorchannel.com
  Form 10-K, Form 10-Q Form 8-K http://www.outdoorchannel.com (951) 699-6991).
  ITEM 1A.
    RISK
    FACTORS.   14




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Cable
    and satellite service providers could discontinue or refrain
    from carrying Outdoor Channel, or decide to not renew our
    distribution agreements, which could substantially reduce the
    number of viewers and harm our operating results.
    If our
    channel is placed in unpopular program packages by cable or
    satellite service providers, or if service fees are increased
    for our subscribers, the number of viewers of our channel may
    decline which could harm our business and operating
    results.
  and/or
  A
    deterioration in general economic conditions may cause a
    decrease in, or hinder our ability to grow, our advertising
    revenues.
   15




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We may
    not be able to effectively manage our future growth or the
    integration of acquisitions, and our growth may not continue,
    which may substantially harm our business and
    prospects.
    We may
    not be able to grow our subscriber base at a sufficient rate to
    offset planned increased costs, decreased revenue or at all, and
    as a result our revenues and profitability may not increase and
    could decrease.
    We do
    not control the methodology used by Nielsen to estimate our
    subscriber base or television ratings, and changes, or
    inaccuracies, in such estimates could cause our advertising
    revenue to decrease.
   16




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If we
    offer favorable terms or incentives to service providers in
    order to grow our subscriber base, our operating results may be
    harmed or your percentage of the Company may be
    diluted.
  un-amortized
  If, in
    our attempt to increase our number of subscribers, we structure
    favorable terms or incentives with one service provider in a way
    that would require us to offer the same terms or incentives to
    all other service providers, our operating results may be
    harmed.
    Consolidation
    among cable and satellite operators may harm our
    business.
    The
    cable and satellite television industry is subject to
    substantial governmental regulation for which compliance may
    increase our costs, hinder our growth and possibly expose us to
    penalties for failure to comply.
     17




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Our
    investments in adjustable rate securities are subject to risks
    which may affect the liquidity of these investments and could
    cause additional impairment charges.
    We may
    not be able to secure additional advertising accounts, and as a
    result, our revenues and profitability may be negatively
    impacted.
    We
    cannot be certain in the future that we will be able to report
    that our controls are without material weakness or to complete
    our evaluation of those controls in a timely
    fashion.
  Form 10-K
 18




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Expenses
    relating to programming costs are generally increasing and a
    number of factors can cause cost overruns and delays, and our
    operating results may be adversely impacted if we are not able
    to successfully recover the costs of developing and acquiring
    new programming.
    Our
    operating results may vary significantly, and historical
    comparisons of our operating results are not necessarily
    meaningful and should not be relied upon as an indicator of
    future performance.
    
    carriage decisions of cable and satellite service providers;
    demand for advertising, advertising rates and offerings of
    competing media;
    changes in the growth rate of cable and satellite subscribers;
    cable and satellite service providers capital and
    marketing expenditures and their impact on programming offerings
    and penetration;
    seasonal trends in viewer interests and activities;
    pricing, service, marketing and acquisition decisions that could
    reduce revenues and impair quarterly financial results;
    the mix of cable television and satellite-delivered programming
    products and services sold and the distribution channels for
    those products and services;
    our ability to react quickly to changing consumer trends;
    increased compensation expenses resulting from the hiring or
    promotion of highly qualified employees;
    specific economic conditions in the cable television and related
    industries; and
    changing regulatory requirements.   19




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Changes
    to financial accounting standards or our accounting estimates
    may affect our reported operating results.
    If we
    fail to develop and distribute popular programs, our viewership
    would likely decline, which could cause advertising and
    subscriber fee revenues to decrease.
    The
    market in which we operate is highly competitive, and we may not
    be able to compete effectively, particularly against competitors
    with greater financial resources, brand recognition, marketplace
    presence and relationships with service providers.
     20




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Changes
    in corporate governance and securities disclosure and compliance
    practices have increased and may continue to increase our legal
    compliance and financial reporting costs.
    The
    satellite infrastructure that we use may fail or be preempted by
    another signal, which could impair our ability to deliver
    programming to our cable and satellite service
    providers.
    Natural
    disasters and other events beyond our control could interrupt
    our signal.
    Seasonal
    increases or decreases in advertising revenue may negatively
    affect our business.
    We may
    be unable to access capital, or offer equity as an incentive for
    increased subscribers or for acquisitions, on acceptable terms
    to fund our future growth and operations.
   21




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We may
    not be able to attract and retain key personnel.
    New
    video recording technologies may reduce our advertising
    revenue.
  ®
  Cable
    and satellite television programming signals have been stolen or
    could be stolen in the future, which reduces our potential
    revenue from subscriber fees and advertising.
    Because
    we expect to become increasingly dependent upon our intellectual
    property rights, our inability to protect those rights could
    negatively impact our ability to compete.
    We may
    face intellectual property infringement claims that could be
    time-consuming, costly to defend and result in our loss of
    significant rights.
   22




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Some
    of our existing stockholders can exert control over us and may
    not make decisions that are in the best interests of all
    stockholders.
    The
    market price of our common stock has been and may continue to be
    subject to wide fluctuations.
  Rule 10b5-1 Rule 10b-18
  Rule 10b5-1 Rule 10b-18
  Anti-takeover
    provisions in our certificate of incorporation, our bylaws and
    under Delaware law may enable our incumbent management to retain
    control of us and discourage or prevent a change of control that
    may be beneficial to our stockholders.
    
    allow the authorized number of directors to be changed only by
    resolution of our board of directors;
    establish a classified board of directors, providing that not
    all members of the board be elected at one time;
    require a
    662/3%
    stockholder vote to remove a director, and only for cause; 23




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
    authorize our board of directors to issue without stockholder
    approval blank check preferred stock that, if issued, could
    operate as a poison pill to dilute the stock
    ownership of a potential hostile acquirer to prevent an
    acquisition that is not approved by our board of directors;
    require that stockholder actions must be effected at a duly
    called stockholder meeting and prohibit stockholder action by
    written consent;
    establish advance notice requirements for stockholder
    nominations to our board of directors or for stockholder
    proposals that can be acted on at stockholder meetings;
    except as provided by law, allow only our board of directors to
    call a special meeting of the stockholders; and
    require a
    662/3%
    stockholder vote to amend our certificate of incorporation or
    bylaws.    Technologies
    in the cable and satellite television industry are constantly
    changing, and our failure to acquire or maintain
    state-of-the-art technology may harm our business and
    competitive advantage.
    If our
    goodwill becomes impaired, we will be required to recognize a
    noncash charge which could have a significant effect on our
    reported net earnings.
    Future
    issuance by us of preferred shares could adversely affect the
    holders of existing shares, and therefore reduce the value of
    existing shares.
    We do
    not expect to pay dividends in the foreseeable
    future.
    ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS.   24




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ITEM 2.
    PROPERTIES.    ITEM 3.
    LEGAL
    PROCEEDINGS.      ITEM 4.
    SUBMISSION
    OF MATTERS TO A VOTE OF SECURITY HOLDERS.   PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES.  Market
    Information
    High


Low2008First Quarter


7.99



5.86Second Quarter


8.09



6.98Third Quarter


8.80



6.54Fourth Quarter


8.93



4.822007First Quarter


13.79



9.74Second Quarter


11.27



9.88Third Quarter


11.86



8.46Fourth Quarter


9.51



5.55     DIVIDEND
    POLICY
   25




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PERFORMANCE
    GRAPH
      Outdoor
    Channel Holdings, Inc.
  Performance
    Graph
  Comparison
    of Cumulative Total Return*
  
   26




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ITEM 6.
    SELECTED
    FINANCIAL DATA.      Year Ended December 31,2008


2007


2006


2005


2004(In thousands, except per share amounts)Income Statement Data:Revenues:Advertising

$
36,562


$
29,149


$
25,034


$
22,273


$
21,381Subscriber fees


17,495



17,297



17,686



15,432



13,391Total revenues


54,057



46,446



42,720



37,705



34,772Income (loss) from operations


4,839



(3,441
)


(13,598
)


2,697



(39,928
)Income (loss) before income taxes and minority interest


6,360



(161
)


(11,153
)


3,593



(39,895
)Income tax provision (benefit)


3,988



1,718



(3,876
)


1,460



(16,135
)Income (loss) before minority interest


2,372



(1,879
)


(7,277
)


2,133



(23,760
)Minority interest in net income of consolidated subsidiary


















682Net income (loss) from continuing operations


2,372



(1,879
)


(7,277
)


2,133



(24,442
)Income from discontinued operations, net of tax






1



289



60



182Net income (loss) applicable to common stock

$
2,372


$
(1,878
)

$
(6,988
)

$
2,193


$
(24,260
)Earnings (loss) from continuing operations per common share:Basic

$
0.09


$
(0.07
)


(0.30
)

$
0.10


$
(1.44
)Diluted

$
0.09


$
(0.07
)


(0.30
)

$
0.09


$
(1.44
)Earnings (loss) per common share:Basic

$
0.09


$
(0.07
)

$
(0.28
)

$
0.10


$
(1.52
)Diluted

$
0.09


$
(0.07
)

$
(0.28
)

$
0.09


$
(1.52
)Weighted average number of common shares outstanding:Basic


25,369



26,027



24,556



21,423



15,998Diluted


26,086



26,027



24,556



24,732



15,998   27




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##### Table of Contents



As of December 31,2008


2007


2006


2005


2004(In thousands)Balance Sheet Data:Cash and cash equivalents

$
60,257


$
25,260


$
14,226


$
17,672


$
12,317Investment in auction-rate and available-for-sale securities


6,456



46,155



42,144



38,830



741Goodwill


43,160



43,160



43,816



44,457



44,457Total assets


142,954



151,701



144,950



151,822



96,678Total liabilities


6,545



5,124



6,004



12,809



6,187Stockholders equity


136,409



146,577



138,946



139,013



90,491   ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS.  Safe
    Harbor Statement
    Form 10-K
  General
       28




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Critical
    Accounting Policies and Estimates
    Revenue
    Recognition
      Long-Lived
    Assets and Goodwill
     29




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Prepaid
    Programming Costs
    Accounts
    Receivable
    Share-Based
    Compensation
      No. 96-18, No. 00-18
  Deferred
    Tax Assets and Income Taxes
   30




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Recent
    Accounting Pronouncements
          No. 142-3, No. 142-3) No. 142-3 and/or No. 142-3 No. 142-3
   31




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FSP 157-3 (FSP 157-3). FSP 157-3 FSP 157-3
  Comparison
    of Operating Results for the Years Ended December 31, 2008
    and December 31, 2007
    Change


% of Total Revenue2008


2007


$


%


2008


2007Revenues:Advertising

$
36,562


$
29,149


$
7,413



25.4
%


67.6
%


62.8
%Subscriber fees


17,495



17,297



198



1.1



32.4



37.2Total revenues


54,057



46,446



7,611



16.4



100.0



100.0Cost of services:Programming


6,903



5,814



1,089



18.7



12.8



12.5Satellite transmission fees


1,971



2,504



(533
)


(21.3
)


3.6



5.4Production and operations


5,892



4,740



1,152



24.3



10.9



10.2Other direct costs


383



194



189



97.4



0.7



0.4Total cost of services.


15,149



13,252



1,897



14.3



28.0



28.5Other expenses:Advertising


3,317



4,705



(1,388
)


(29.5
)


6.1



10.1Selling, general and administrative


28,305



29,265



(960
)


(3.3
)


52.4



63.0Depreciation and amortization


2,447



2,665



(218
)


(8.2
)


4.5



5.7Total other expenses


34,069



36,635



(2,566
)


(7.0
)


63.0



78.9Income (loss) from operations


4,839



(3,441
)


8,280



(240.6
)


8.9



(7.4
)Interest and other income, net


1,521



3,280



(1,759
)


(53.6
)


2.8



7.1Income (loss) from continuing operations before income taxes


6,360



(161
)


6,521



NM



11.8



(0.3
)Income tax provision


3,988



1,718



2,270



132.1



7.4



3.7Income (loss) from continuing operations


2,372



(1,879
)


4,251



(226.2
)


4.4



(4.0
)Income from discontinued operations, net of tax






1



(1
)


(100.0
)






Net income (loss)

$
2,372


$
(1,878
)

$
4,250



(226.3
)%


4.4
%


(4.0
)%    32




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Revenues
             33




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Cost of
    Services
              Other
    Expenses
     34




---



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Income
    (Loss) from Operations
    Interest
    and Other Income, Net
   35




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Income
    (Loss) from Continuing Operations Before Income Taxes
    Income
    Tax Provision
  pre-tax
  Income
    (Loss) from Continuing Operations
    Income
    from Discontinued Operations, Net of Tax
    Net
    Income (Loss)
   36




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Comparison
    of Operating Results for the Years Ended December 31, 2007
    and December 31, 2006
    Change


% of Total Revenue2007


2006


$


%


2007


2006Revenues:Advertising

$
29,149


$
25,034


$
4,115



16.4
%


62.8
%


58.6
%Subscriber fees


17,297



17,686



(389
)


(2.2
)


37.2



41.4Total revenues


46,446



42,720



3,726



8.7



100.0



100.0Cost of services:Programming


5,814



8,320



(2,506
)


(30.1
)


12.5



19.5Satellite transmission fees


2,504



2,550



(46
)


(1.8
)


5.4



6.0Production and operations


4,740



4,046



694



17.2



10.2



9.5Other direct costs


194



67



127



189.6



0.4



0.1Total cost of services


13,252



14,983



(1,731
)


(11.6
)


28.5



35.1Other expenses:Advertising


4,705



7,010



(2,305
)


(32.9
)


10.1



16.4Selling, general and administrative


29,265



21,898



7,367



33.6



63.0



51.3Impairment of amortizable intangible assets






9,540



(9,540
)


(100.0
)






22.3Depreciation and amortization


2,665



2,887



(222
)


(7.7
)


5.7



6.8Total other expenses


36,635



41,335



(4,700
)


(11.4
)


78.9



96.8Income (loss) from operations


(3,441
)


(13,598
)


10,157



(74.7
)


(7.4
)


(31.9
)Interest and other income, net


3,280



2,445



835



34.2



7.1



5.7Income (loss) from continuing operations before income taxes


(161
)


(11,153
)


10,992



(98.6
)


(0.3
)


(26.2
)Income tax provision (benefit)


1,718



(3,876
)


5,594



(144.3
)


3.7



(9.1
)Income (loss) from continuing operations


(1,879
)


(7,277
)


5,398



(74.2
)


(4.0
)


(17.1
)Income (loss) from discontinued operations, net of tax


1



289



(288
)


(99.7
)






0.7Net income (loss)

$
(1,878
)

$
(6,988
)

$
5,110



(73.1
)%


(4.0
)%


(16.4
)%(percentages may not add due to rounding)   Revenues
       37




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Cost of
    Services
           38




---



##### Table of Contents



Other
    Expenses
         39




---



##### Table of Contents



Income
    (Loss) from Operations
    Interest
    and Other Income, Net
    Income
    (Loss) from Continuing Operations Before Income Taxes
    Income
    Tax Provision (Benefit)
   40




---



##### Table of Contents



pre-tax
  Income
    (Loss) from Continuing Operations
    Income
    (Loss) from Discontinued Operations, Net of Tax
    Net
    Income (Loss)
    Liquidity
    and Capital Resources
       41




---



##### Table of Contents



Less than


1 - 3


3 - 5


AfterContractual Obligations

Total


1 Year


Years


Years


5 YearsOperating lease obligations

$
12,466


$
3,933


$
4,632


$
2,458


$
1,443Purchase obligations


22,968



13,442



8,794



729



3Other long-term liabilities


768



768











Total

$
36,202


$
18,143


$
13,426


$
3,187


$
1,446     ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.   42




---



##### Table of Contents



43




---



##### 



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA.  INDEX
   
 Reports of Independent Registered Public
    Accounting Firms


45Consolidated Balance Sheets as of
    December 31, 2008 and 2007


47Consolidated Statements of Operations for the
    Years Ended December 31, 2008, 2007 and 2006


48Consolidated Statements of Stockholders
    Equity for the Years Ended December 31, 2008, 2007 and
    2006


49Consolidated Statements of Cash Flows for the
    Years Ended December 31, 2008, 2007 and 2006


52Notes to Consolidated Financial Statements


53   44




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM            
    45




---



##### Table of Contents



Report
    of Independent Registered Public Accounting Firm
              
    46




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Balance Sheets
 As of
    December 31, 2008 and 2007
  2008


2007(In thousands, except per share data)ASSETSCurrent assets:Cash and cash equivalents

$
60,257


$
25,260Investments in available-for-sale securities






46,155Accounts receivable, net of allowance for doubtful accounts of
    $891 and $302


9,448



8,299Income tax refund receivable






224Deferred tax assets, net


1,524



705Prepaid programming costs


3,997



3,522Other current assets


1,333



1,175Total current assets


76,559



85,340Property, plant and equipment, net


10,042



11,632Amortizable intangible assets, net


142



313Goodwill


43,160



43,160Investments in auction-rate securities


6,456



Deferred tax assets, net


4,949



9,326Deposits and other assets


1,646



1,930Totals

$
142,954


$
151,701LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses

$
5,923


$
4,158Accrued severance payments


25



257Deferred revenue


205



261Current portion of deferred obligations


126



143Income taxes payable


30



Customer deposits






14Total current liabilities


6,309



4,833Accrued severance payments, net of current portion






22Deferred obligations


236



269Total liabilities


6,545



5,124Commitments and contingencies  See Note 9Stockholders equity:Preferred stock; $0.001 par value; 25,000 shares
    authorized; none issued






Common stock, $0.001 par value; 75,000 shares
    authorized: 25,246 and 26,870 shares issued and outstanding


25



27Additional paid-in capital


163,300



175,570Accumulated other comprehensive (loss)


(327
)


(59
)Accumulated deficit


(26,589
)


(28,961
)Total stockholders equity


136,409



146,577Totals

$
142,954


$
151,701    47




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Operations
 For
    The Years Ended December 31, 2008, 2007 and 2006
  2008


2007


2006(In thousands, except per share data)Revenues:Advertising

$
36,562


$
29,149


$
25,034Subscriber fees


17,495



17,297



17,686Total revenues


54,057



46,446



42,720Cost of services:Programming


6,903



5,814



8,320Satellite transmission fees


1,971



2,504



2,550Production and operations


5,892



4,740



4,046Other direct costs


383



194



67Total cost of services


15,149



13,252



14,983Other expenses:Advertising


3,317



4,705



7,010Selling, general and administrative


28,305



29,265



21,898Impairment of amortizable intangible assets










9,540Depreciation and amortization


2,447



2,665



2,887Total other expenses


34,069



36,635



41,335Income (loss) from operations


4,839



(3,441
)


(13,598
)Interest and other income, net


1,521



3,280



2,445Income (loss) from continuing operations before income taxes


6,360



(161
)


(11,153
)Income tax provision (benefit)


3,988



1,718



(3,876
)Income (loss) from continuing operations


2,372



(1,879
)


(7,277
)Income from discontinued operations, net of tax






1



289Net income (loss)

$
2,372


$
(1,878
)

$
(6,988
)Basic earnings (loss) per common share data:From continuing operations

$
0.09


$
(0.07
)

$
(0.30
)From discontinued operations

$



$
0.00


$
0.01Basic earnings per common share

$
0.09


$
(0.07
)

$
(0.28
)Diluted earnings (loss) per common share data:From continuing operations

$
0.09


$
(0.07
)

$
(0.30
)From discontinued operations

$



$
0.00


$
0.01Diluted earnings per common share

$
0.09


$
(0.07
)

$
(0.28
)Weighted average number of common shares outstanding:Basic


25,369



26,027



24,556Diluted


26,086



26,027



24,556    48




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Stockholders Equity
 For the
    Years Ended December 31, 2008, 2007 and 2006
  AccumulatedAdditional


OtherCommon Stock


Paid-in


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


Total(In thousands)Balance, December 31, 2007


26,870


$
27


$
175,570


$
(59
)

$
(28,961
)

$
146,577Comprehensive Income:Net income


















2,372



2,372Effect of change in fair value of available-for-sale securities














(268
)






(268
)Total comprehensive income






















2,104Common stock issued upon exercise of stock options


2







11











11Issuance of restricted stock and performance shares to employees
    for services to be rendered, net of forfeited shares


408



















Share-based employee and service provider compensation expense










3,605











3,605Purchase and retirement of treasury stock related to employee
    and service provider share-based compensation activity


(75
)






(549
)










(549
)Purchase and retirement of treasury stock related to stock
    repurchase program


(1,959
)


(2
)


(14,998
)










(15,000
)Tax shortfalls from share-based payments










(339
)










(339
)Balance, December 31, 2008


25,246


$
25


$
163,300


$
(327
)

$
(26,589
)

$
136,409 49




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Stockholders
    Equity  (Continued)
  AccumulatedAdditional


OtherCommon Stock


Paid-in


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


Total(In thousands)Balance, December 31, 2006


25,507


$
26


$
165,205


$
48


$
(26,333
)

$
138,946Comprehensive Income (Loss):Net income (loss)


















(1,878
)


(1,878
)Effect of change in fair value of available-for-sale securities,
    net of deferred tax benefit of $67














(107
)






(107
)Total comprehensive income (loss)






















(1,985
)Common stock issued upon exercise of stock options


975



1



1,194











1,195Issuance of restricted stock and performance shares to employees
    for services to be rendered, net of forfeited shares


482



















Share-based employee and service provider compensation expense










10,260











10,260Purchase and retirement of treasury stock related to employee
    and service provider share-based compensation activity


(94
)






(823
)










(823
)Tax shortfalls from share-based payments










(266
)










(266
)Cumulative effect of adoption of new accounting
    pronouncement  Note 2


















(750
)


(750
)Balance, December 31, 2007


26,870


$
27


$
175,570


$
(59
)

$
(28,961
)

$
146,577    50




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Stockholders Equity
 For the
    Years Ended December 31, 2008, 2007 and 2006
  AccumulatedAdditional





OtherCommon Stock


Paid-in


Deferred


Comprehensive


AccumulatedShares


Amount


Capital


Compensation


Income (Loss)


Deficit


Total(In thousands)Balance, December 31, 2005


24,409


$
24


$
159,890


$
(1,520
)

$
(36
)

$
(19,345
)

$
139,013Comprehensive Income (Loss):Net (loss)






















(6,988
)


(6,988
)Effect of change in fair value of available-for-sale securities,
    net of deferred taxes of $(25)


















12







12Impact of cash flow hedge


















72







72Total comprehensive income (loss)


























(6,904
)Reclassification of deferred compensation upon adoption of
    SFAS 123R










(1,520
)


1,520











Common stock issued upon exercise of stock options


768



2



911















913Issuance of restricted stock to employees and service providers
    for services to be rendered, net of forfeited shares


374























Share-based employee and service provider compensation expense










6,492















6,492Purchase and retirement of treasury stock


(44
)






(568
)














(568
)Change in estimate of tax benefit from exercise of stock options










(814
)














(814
)Tax benefit from exercise of stock options










814















814Balance, December 31, 2006


25,507


$
26


$
165,205


$



$
48


$
(26,333
)

$
138,946    51




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Cash Flows
 Years
    Ended December 31, 2008, 2007 and 2006
  2008


2007


2006(In thousands)Operating activities:Net income (loss)

$
2,372


$
(1,878
)

$
(6,988
)Adjustments to reconcile net income (loss) to net cash provided
    by operating activities of continuing operations:Income from discontinued operations






(1
)


(289
)Depreciation and amortization


2,447



2,665



2,887Amortization of subscriber acquisition fees


489



489



233Loss on sale of equipment


36







Gain on sale of available-for-sale and auction-rate securities


(75
)






Other-than-temporary impairment on auction-rate securities, net


336







Impairment of amortizable intangible assets










9,540Provision for doubtful accounts


709



219



85Share-based employee and service provider compensation


3,605



10,260



6,492Deferred tax provision, net


3,249



1,628



(3,648
)Tax benefits from exercise of stock options in excess of
    recognized expense






(1,520
)


(814
)Changes in operating assets and liabilities:Accounts receivable


(1,853
)


(1,702
)


(1,616
)Income tax refund receivable


224



2,075



894Prepaid programming costs


(475
)


(809
)


(332
)Other current assets


(158
)


(340
)


(255
)Deposits and other assets


(205
)


(318
)


(1,774
)Accounts payable and accrued expenses


1,917



1,344



89Accrued severance payments


(254
)


(106
)


385Customer deposits


(14
)


(39
)


53Deferred revenue


(56
)


(349
)


387Deferred obligations


(50
)


46



71Net cash provided by operating activities


12,244



11,664



5,400Investing activities:Purchases of property, plant and equipment


(857
)


(1,259
)


(2,377
)Purchase of intangibles


(97
)






Proceeds from sale of equipment


74



12



Proceeds from sale of discontinued operations






3,589



Purchases of available-for-sale and auction-rate securities


(27,181
)


(130,945
)


(132,505
)Proceeds from sale of available-for-sale and auction-rate
    securities


66,352



126,760



129,255Net cash provided by (used in) investing activities


38,291



(1,843
)


(5,627
)Financing activities:Principal payments on long-term debt and capital leases










(4,901
)Proceeds from exercise of stock options


11



1,195



913Purchase and retirement of stock related to stock repurchase
    program


(15,000
)






Purchase of treasury stock


(549
)


(823
)


(568
)Tax benefits from exercise of stock options in excess of
    recognized expense






1,520



814Net cash provided by (used in) financing activities


(15,538
)


1,892



(3,742
)Cash flows from discontinued operations:Net cash provided by (used in) operating activities of
    discontinued operations






(618
)


617Net cash used in investing activities of discontinued operations






(61
)


(103
)Net cash provided by financing activities of discontinued
    operations










9Net cash provided by (used in) discontinued operations






(679
)


523Net increase (decrease) in cash and cash equivalents


34,997



11,034



(3,446
)Cash and cash equivalents, beginning of year


25,260



14,226



17,672Cash and cash equivalents, end of year

$
60,257


$
25,260


$
14,226Supplemental disclosure of cash flow information:Interest paid

$



$
12


$
245Income taxes paid

$
514


$
349


$
1Supplemental disclosures of non-cash investing and financing
    activities:Issuance of restricted stock to employees for services rendered

$
3,713


$
3,387


$
2,737Retirement of treasury stock

$
549


$
823


$
568Effect of net increase (decrease) in fair value of
    available-for-sale securities, net of deferred taxes

$
(268
)

$
(107
)

$
12Property, plant and equipment costs incurred but not paid

$
17


$
171


$
8Effect of net increase in fair value of cash flow hedge

$



$



$
72    52




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes
    to Consolidated Financial Statements
 (In thousands, except per share data)
  Note 1 
    Organization
    and Business  Description
    of Operations
      Reclassifications
    Principles
    of Consolidation
    Basis
    of Presentation
    Use
    of Accounting Estimates
    Note 2 
    Summary
    of Significant Accounting Policies  Cash
    and Cash Equivalents
   53




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Subscriber
    Acquisition Fees
      Prepaid
    Programming Costs
    Property,
    Plant and Equipment
    Buildings and improvements


10 - 39 yearsEquipment


5 yearsFurniture and fixtures


3 - 7 yearsVehicles


7 yearsLeasehold improvements


3 - 10 years   Amortizable
    Intangible Assets
    Long-Lived
    Assets
   54




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Goodwill
    Advertising
    Revenue
    Recognition
           55




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Income
    Taxes
        Earnings
    (Loss) Per Share
      2008


2007


2006Weighted average shares used to calculate basic earnings (loss)
    per share


25,369



26,027



24,556Dilutive effect of potentially issuable common shares upon
    exercise of dilutive stock options and performance units


717







Weighted average shares used to calculate diluted earnings
    (loss) per share


26,086



26,027



24,556    56




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Stock
    Incentive Plans
      No. 96-18, No. 00-18
  Investments
  ,
  Recent
    Accounting Pronouncements
     57




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
        No. 142-3, No. 142-3) No. 142-3 and/or No. 142-3 No. 142-3
    FSP 157-3 (FSP 157-3). FSP 157-3 FSP 157-3
 58




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
   Note 3 
    Subscriber
    Acquisition Fees    2008


2007Subscriber acquisition fees, at cost

$
2,445


$
2,445Accumulated amortization


(1,224
)


(735
)Subscriber acquisition fees, net

$
1,221


$
1,710     Years Ending December 31,

Amount2009

$
4892010


4762011


256Total amortization

$
1,221     Note 4 
    Fair
    Value Measurements and Investments      Level 1
  Level 2
  Level 3
    Quoted Prices in


SignificantActive Markets for


Other


SignificantIdentical Assets


Observable Inputs


Unobservable InputsTotal


(Level 1)


(Level 2)


(Level 3)Cash and cash equivalents(1)

$
60,257


$
60,257


$



$
Non-current investments in available-for-sale securities(2)


6,456











6,456Total

$
66,713


$
60,257


$



$
6,456  59




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    (1)
    
    Cash and cash equivalents consist primarily of treasury bills
    and money market funds with original maturity dates of three
    months or less, for which we determine fair value through quoted
    market prices.(2)
    
    Investments in available-for-sale securities consist of one
    auction-rate municipal security and three closed end perpetual
    preferred auction-rate securities (PPS). PPS were
    originally considered Level 2 financial assets and valued
    using estimated market values as of the balance sheet date
    obtained from an independent pricing service employed by our
    broker dealers. These independent pricing services carried these
    investments at par value, due to the overall quality of the
    underlying investments and taking into account credit ratings,
    and the anticipated future market for such investments. However,
    during the quarter ending September 30, 2008, we began
    using discounted cash flow analysis to more accurately measure
    possible liquidity discounts. Because the discounted cash flow
    analysis included unobservable inputs we transferred these
    securities to Level 3 financial assets.   60




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Year EndedDecember 31,2008Auction-Rate Securities:Balance at beginning of period

$
Transfers into Level 3


9,725Unrealized losses included in accumulated other comprehensive
    loss


(327
)Other-than-temporary impairment


(336
)Transfers into Level 2


(2,606
)Balance as of December 31, 2008

$
6,456     Year Ended December 31,2008


2007


2006Interest income

$
1,750


$
3,215


$
2,611Interest expense






(12
)


(245
)Dividend income


32



77



79Loss on sale of equity securities


(44
)






Other-than-temporary impairment on auction-rate securities


(336
)






Realized gain on sale of auction-rate securities


119







Total interest and other income, net

$
1,521


$
3,280


$
2,445   Note 5 
    Comprehensive
    Income (loss)    2008


2007


2006Net income (loss), as reported

$
2,372


$
(1,878
)

$
(6,988
)Unrealized losses on available-for-sale securities


(268
)


(107
)


12Impact of cash flow hedge










72Comprehensive income (loss)

$
2,104


$
(1,985
)

$
(6,904
)  61




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Note 6 
    Property,
    Plant and Equipment    2008


2007Land

$
600


$
600Buildings and improvements


8,822



8,714Equipment


7,289



6,827Furniture and fixtures


228



119Vehicles


271



528Leasehold improvements


649



64017,859



17,428Less accumulated depreciation


(7,817
)


(5,796
)Totals

$
10,042


$
11,632     Note 7 
    Goodwill
    and Intangible Assets      2008AccumulatedGross


Amortization


NetAdvertising customer relationships

$
1,972


$
1,972


$
Trademark


219



174



45Internet domain names


97







97Total intangible assets

$
2,288


$
2,146


$
142   2007AccumulatedGross


Amortization


NetAdvertising customer relationships

$
1,972


$
1,719


$
253Trademark


219



159



60Total intangible assets

$
2,191


$
1,878


$
313      62




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Years Ending December 31,

Amount2009

$
642010


632011


112012


4Total

$
142   Note 8 
    Lines of
    Credit  Bank
    Lines of Credit
    Note 9 
    Commitments
    and Contingencies        Less than


1 - 3


3 - 5


AfterTotal


1 Year


Years


Years


5 YearsOperating lease obligations

$
12,466


$
3,933


$
4,632


$
2,458


$
1,443Purchase obligations


22,968



13,442



8,794



729



3Other long-term liabilities


768



768











Total

$
36,202


$
18,143


$
13,426


$
3,187


$
1,446    63




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Rule 10b-18
      Operating
    Leases
        64




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Years Ending December 31,

Amount2009

$
3,9332010


2,9092011


1,7232012


1,4392013


1,019Thereafter


1,443Total

$
12,466   Note 10 
    Income
    Taxes    2008


2007


2006Current:Federal

$
225


$
40


$
State


541



3



2Total current


766



43



2Deferred:Federal


3,239



1,411



(3,050
)State


(17
)


264



(828
)Total deferred


3,222



1,675



(3,878
)Totals

$
3,988


$
1,718


$
(3,876
)  65




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
     2008


2007Deferred tax assets:Net operating loss carryforwards

$
958


$
4,542Share-based compensation


4,795



5,106Deferred revenues


80



97Other accrued liabilities


406



117Alternative minimum tax credit


319



95Allowance for doubtful accounts


323



Programming costs


364



348Capital loss carryover


519



251Other


220



397Subtotal


7,984



10,953Less: Valuation allowance


(519
)


(251
)$
7,465


$
10,702Deferred tax liabilities:Property, plant and equipment


(521
)


(532
)State taxes


(471
)Intangible assets






(95
)Other






(44
)(992
)


(671
)Deferred tax assets, net

$
6,473


$
10,031       2008


2007


2006Federal income tax provision (benefit) at statutory income tax
    rate

$
2,162


$
(55
)

$
(3,792
)State taxes, net of federal benefit


346



177



(397
)Non-deductible expense


41



21



273Share-based compensation


925



1,200



Officer compensation


418







Valuation allowance


89



251



Other


7



124



40Income tax provision (benefit)

$
3,988


$
1,718


$
(3,876
)  66




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Gross unrecognized tax benefits as of January 1, 2008

$
1,309Increases in tax positions for prior years


Decreases in tax positions for prior years


Settlements


Lapse in statute of limitations


Gross unrecognized tax benefits as of December 31, 2008

$
1,309       Note 11 
    Stock
    Incentive Plans        1995 Stock Option Plan (1995
    Plan).
 67




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2004 Long-Term Incentive Plan (LTIP
    Plan).
  Non-Employee Director Stock Option Plan
    (NEDSOP).
      EITF 96-18
 68




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    December 31,2008


2007


2006Nature of Award:Restricted stock

$
3,004


$
1,975


$
686Options


601



1,701



3,400Performance units






6,584



2,406Total share-based compensation expense

$
3,605


$
10,260


$
6,492   December 31,2008


2007


2006Classification of Compensation Expense:Cost of services:Production and operations

$
440


$
263


$
197Other expenses:Selling, general and administrative


3,165



9,997



6,295Total share-based compensation expense

$
3,605


$
10,260


$
6,492     Year Ended December 31,2008

2007

2006Risk-free interest rate

1.4 - 2.3%

4.9 - 5.0%

4.3 - 4.9%Dividend yield

0.0%

0.0%

0.0%Weighted average expected life

0.1 - 0.3 years

0.8 years

3.3 - 3.8 yearsExpected volatility

33.6 - 52.6%

39.2 - 39.5%

48.7 - 58.9%Weighted average volatility factor

45.4%

39.4%

53.1%     Issuances
    of Common Stock by the Company
    2008


2007


2006Number of options exercised


2



975



768Cash proceeds

$
11


$
1,195


$
913Tax benefit from options exercised

$
2


$
2,376


$
1,463    69




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  EITF 96-18
  Stock
    Options
    WeightedWeighted


Average


AggregateAverage


Remaining


IntrinsicShares


Exercise


Contractual


Value(in thousands)


Price


Term (yrs.)


(in thousands)Outstanding at January 1, 2006


3,564


$
7.31Granted


505



12.40Exercised


(768
)


1.19Forfeited


(24
)


13.07Expired


(5
)


14.55Outstanding at December 31, 2006


3,272



9.48Granted






Exercised


(975
)


1.23Forfeited


(448
)


14.06Expired


(407
)


13.60Outstanding at December 31, 2007


1,442



12.48Granted






Exercised


(2
)


6.14Forfeited


(23
)


12.11Expired


(587
)


11.92Outstanding at December 31, 2008


830


$
12.90



2.97


$
Vested and expected to vest at December 31, 2008


826


$
12.90



2.97


$
Exercisable at December 31, 2008


775


$
12.86



3.05


$
  70




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Options Outstanding


Options ExercisableWeightedAverage


Weighted





WeightedRemaining


Average





AverageNumber


Contractual


Exercise


Number


ExerciseRange of Exercise Prices

Outstanding


Term (yrs.)


Price


Exercisable


Price(In thousands)








(In thousands)$10.19 - $10.19


10



2.25


$
10.19



5


$
10.19$12.10 - $12.10


300



2.79



12.10



300



12.10$12.50 - $12.58


170



4.15



12.52



152



12.51$12.80 - $13.90


250



3.00



13.35



244



13.34$14.86 - $14.95


75



1.84



14.89



49



14.89$15.75 - $15.75


25



0.44



15.75



25



15.75Total


830



2.97


$
12.90



775


$
12.86     Restricted
    Stock
    WeightedAverageShares


Grant-Date(in thousands)


Fair ValueNonvested at January 1, 2006


127


$
14.43Granted


245



12.12Vested


(37
)


13.70Forfeited


(21
)


14.10Nonvested at December 31, 2006


314



12.73Granted


538



9.41Vested


(99
)


12.31Forfeited


(56
)


12.46Nonvested at December 31, 2007


697



10.25Granted


504



7.37Vested


(256
)


10.62Forfeited


(96
)


9.96Nonvested at December 31, 2008


849


$
8.46    71




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Expense
    to be Recognized
    As of December 31, 2008Weighted AverageExpense Yet


Remainingto be


Requisite ServiceRecognized


PeriodsStock options

$
394



0.89 yearsRestricted stock


6,038



2.93 yearsTotal

$
6,432



2.81 years   Additional
    Required Disclosures Related to Employee Performance
    Units
    First Award

Second AwardRisk-free interest rate

4.8%

4.8%Dividend yield

0.0%

0.0%Closing per share price on grant date

$12.10

$12.10Expected volatility

54.0%

72.9%Estimated service period

7.2 months

13.3 monthsFair value of one common share

$11.29

$11.19     Note 12 
    Related
    Party Transactions     72




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Note 13 
    Discontinued
    Operations        Year Ended December 31,2008


2007


2006Revenue

$



$
1,632


$
5,703Income (loss) from operations






73



441Income (loss) from discontinued operations, net of tax

$



$
1


$
289   Note 14 
    Concentration
    of Credit Risk        Balance at


Additions





Balance atBeginning of


Charged to





End ofYear


Expense


Deductions


YearYear-ended December 31, 2008

$
240


$
709


$
(58
)

$
891Year-ended December 31, 2007


180



219



(159
)


240Year-ended December 31, 2006


266



85



(171
)


180   Note 15 
    401(k)
    Savings Plan   73




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Note 16 
    Accounts
    Payable and Accrued Expenses    2008


2007Trade accounts payable

$
855


$
1,498Accrued payroll and related expenses


2,665



507Estimated make-good accrual


252



296Accrued expenses


2,151



1,857Total

$
5,923


$
4,158   Note 17 
    Quarterly
    Financial Information (Unaudited)    Three Months EndedMarch 31


June 30


September 30


December 312008Revenue

$
11,680


$
13,047


$
14,956


$
14,374Income (loss) from operations


(1,597
)


230



3,738



2,468Net income (loss)


(781
)


271



2,394



488Earnings (loss) per common share:Basic

$
(0.03
)

$
0.01


$
0.10


$
0.02Diluted

$
(0.03
)

$
0.01


$
0.09


$
0.022007Revenue

$
10,993


$
11,296


$
12,542


$
11,615Income (loss) from operations


(1,932
)


(1,056
)


583



(1,036
)Net income (loss)


(727
)


(1,070
)


1,498



(1,579
)Earnings (loss) per common share:Basic

$
(0.03
)

$
(0.04
)

$
0.06


$
(0.06
)Diluted

$
(0.03
)

$
(0.04
)

$
0.06


$
(0.06
)   Note 18 
    Subsequent
    Events (Unaudited)    Rule 10b5-1 Rule 10b-18
   74




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##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE.    ITEM 9A.
    CONTROLS
    AND PROCEDURES.  Evaluation of disclosure controls and
    procedures. Rule 13a-15(e) 15d-15(e)
    Changes in internal control over financial
    reporting.
  Managements report on internal control over financial
    reporting. Rule 13a-15(f)
   75




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##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                
    76




---



##### Table of Contents



ITEM 9B.
    OTHER
    INFORMATION.   PART III ITEM 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.    ITEM 11.
    EXECUTIVE
    COMPENSATION.    ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS.    ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE.    ITEM 14.
    PRINCIPAL
    ACCOUNTANT FEES AND SERVICES.   77




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##### Table of Contents



PART IV  ITEM 15.
    EXHIBITS AND
    FINANCIAL STATEMENT SCHEDULES.  (a) The following documents are included as part of this
    Annual Report on
    Form 10-K.
    Index to Financial Statements


44Reports of Independent Registered Public Accounting Firms


45Consolidated Balance Sheets


47Consolidated Statements of Operations


48Consolidated Statements of Stockholders Equity


49Consolidated Statements of Cash Flows


52Notes to Consolidated Financial Statements


53     Regulation S-K.
  (b)
    Exhibits  ExhibitNumber

Description2
.1

Amended and Restated Agreement and Plan of Merger among The
    Outdoor Channel, Inc., Outdoor Channel Holdings, Inc. and Gold
    Prospectors Association of America, Inc. dated as of
    April 20, 2004, as amended and restated as of May 12,
    2004 (filed as Exhibit 2.1 to the Companys Current
    Report on
    Form 8-K
    filed on May 18, 2004 and incorporated herein by reference).2
.2

Agreement and Plan of Merger between Outdoor Channel Holdings,
    Inc., a Delaware corporation, and Outdoor Channel Holdings,
    Inc., an Alaska corporation, dated as of September 8, 2004
    (filed as Exhibit 2.1 to the Companys Current Report
    on
    Form 8-K
    filed on September 20, 2004 and incorporated herein by
    reference).3
.1

Certificate of Incorporation of Outdoor Channel Holdings, Inc, a
    Delaware corporation (filed as Exhibit 3.1 to the
    Companys Current Report on
    Form 8-K
    filed on September 20, 2004 and incorporated herein by
    reference).3
.2

By-Laws of Outdoor Channel Holdings, Inc., a Delaware
    corporation (filed as Exhibit 3.2 to the Companys
    Current Report on
    Form 8-K
    filed on September 20, 2004 and incorporated herein by
    reference)4
.1

Instruments defining the rights of security holders, including
    debentures (see exhibits 3.1 and 3.2 above).10
.1

Letter of intent dated August 27, 1993, regarding the
    proposed acquisition of Gold Prospectors Association of
    America, Inc. by the Company (filed as Exhibit 10.4 to the
    Companys
    Form 10-Q
    for the quarter ended September 30, 1993 and incorporated
    herein by reference).10
.2

Agreement and Plan of Reorganization dated February 13,
    1995, by and between the Registrant and Gold Prospectors
    Association of America, Inc. (filed as Exhibit B to the
    Companys
    Form 8-K
    dated February 13, 1995 and incorporated herein by
    reference).10
.3*

Form of Indemnification Agreement between Outdoor Channel
    Holdings, Inc. and its directors and certain executive officers
    (filed as Exhibit 10.1 to the Companys
    Form 10-Q
    for the quarter ended September 30, 2004 and incorporated
    herein by reference).10
.4

Revolving Credit Agreement and related agreements by and between
    the Company and U.S. Bank N.A. dated September 30, 2004
    (filed as Exhibit 10.2 to the Companys
    Form 10-Q
    for the quarter ended September 30, 2004 and incorporated
    herein by reference).10
.5*

1995 Stock Option Plan (filed as Exhibit 10.6 to the
    Companys
    Form 10-KSB
    for the year ended December 31, 1995 and incorporated
    herein by reference).10
.6*

Form of Stock Option Agreement pursuant to the Companys
    1995 Stock Option Plan (filed as Exhibit 4.2 to the
    Companys Registration Statement on
    Form S-8
    with respect to the shares underlying such plan that was filed
    on November 12, 2004 and incorporated herein by reference). 78




---



##### Table of Contents



ExhibitNumber

Description10
.7*

The Outdoor Channel, Inc. 1997 Stock Option Plan (filed as
    Exhibit 4.1 to the Companys Registration Statement on
    Form S-8
    with respect to the shares underlying the options assumed by the
    Company under such plan that was filed on November 12, 2004
    and incorporated herein by reference).10
.8*

Form of Stock Option Agreement pursuant to The Outdoor Channel,
    Inc. 1997 Stock Option Plan (filed as Exhibit 4.2 to the
    Companys Registration Statement on
    Form S-8
    with respect to the shares underlying the options assumed by the
    Company under such plan that was filed on November 12, 2004
    and incorporated herein by reference).10
.9*

Non-Statutory Stock Option Plan and Agreement, dated as of
    November 13, 2003, by and between the Company and William
    A. Owen, as amended (filed as Exhibit 4.1 to the
    Companys Registration Statement on
    Form S-8
    with respect to the shares underlying such plan that was filed
    on November 12, 2004 and incorporated herein by reference).10
.10*

Non-Employee Directors Stock Option Plan, as amended (filed as
    Exhibit 4.1 to the Companys Registration Statement on
    Form S-8
    with respect to the shares underlying such plan that was filed
    on November 12, 2004 and incorporated herein by reference).10
.11*

Form of Stock Option Agreement pursuant to Non-Employee
    Directors Stock Option Plan (filed as Exhibit 10.13 to the
    Companys
    Form 10-KSB
    for the year ended December 31, 2003 and incorporated
    herein by reference).10
.12*

2004 Long-Term Incentive Plan (filed as Exhibit 4.1 to the
    Companys Registration Statement on
    Form S-8
    with respect to the shares underlying such plan that was filed
    on November 12, 2004 and incorporated herein by reference).10
.13*

Form of Stock Option Award Agreement pursuant to 2004 Long-Term
    Incentive Plan (filed as Exhibit 99.1 to the Companys
    Form 8-K
    dated December 20, 2004 and incorporated herein by
    reference).10
.14*

Form of Restricted Shares Award Agreement pursuant to 2004
    Long-Term Incentive Plan (filed as Exhibit 99.2 to the
    Companys
    Form 8-K
    dated December 20, 2004 and incorporated herein by
    reference).10
.15

Omitted.10
.16*

Outdoor Channel Holdings, Inc. Executive Annual Cash Bonus Plan
    effective April 21, 2005 (filed as Exhibit 10.2 to the
    Companys
    Form 10-Q/A
    for the quarter ended March 31, 2005 and incorporated
    herein by reference).10
.17*

Selling Stockholders Registration Rights Agreement, dated as of
    June 27, 2005, among Outdoor Channel Holdings, Inc. and the
    selling stockholders who are a party (filed as Exhibit 10.1
    to the Companys current report on
    Form 8-K
    filed on June 28, 2005 and incorporated herein by
    reference).10
.18

Amendment to Loan Agreement and Note and related agreements by
    and between the Company and U.S. Bank N.A. dated
    October 18, 2005 (filed as Exhibit 10.18 to the
    Companys Annual Report on
    Form 10-K
    filed on March 16, 2006 and incorporated herein by
    reference).10
.19

Term Loan Agreement and related agreements by and between 43455
    BPD, LLC and U.S. Bank N.A. dated as of October 18, 2005
    (filed as Exhibit 10.19 to the Companys Annual Report
    on
    Form 10-K
    filed on March 16, 2006 and incorporated herein by
    reference).10
.20

Term Loan Agreement and related agreements by and between the
    Company and U.S. Bank N.A. dated as of October 18, 2005
    (filed as Exhibit 10.20 to the Companys Annual Report
    on
    Form 10-K
    filed on March 16, 2006 and incorporated herein by
    reference).10
.21*

Optionholders Registration Rights Agreement by and among the
    Company, Ray V. Miller and Elizabeth J. Sanderson dated as of
    December 5, 2005 (filed as Exhibit 10.1 to the
    Companys current report on
    Form 8-K
    filed on December 6, 2005 and incorporated herein by
    reference).10
.22*

Lease by and between the Company and Musk Ox Properties, L.P.
    dated as of January 1, 2006 (filed as Exhibit 10.22 to
    the Companys Annual Report on
    Form 10-K
    filed on March 16, 2006 and incorporated herein by
    reference).10
.23*

Employment Agreement with Roger L. Werner, Jr., effective as of
    October 16, 2006 (filed as Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed on October 20, 2006 and incorporated herein by
    reference).10
.24*

Form of Performance Unit Agreement (filed as Exhibit 10.2
    to the Companys Current Report on
    Form 8-K
    filed on October 20, 2006 and incorporated herein by
    reference). 79




---



##### Table of Contents



ExhibitNumber

Description10
.25*

Amendment of Employment Agreement with Roger L. Werner, Jr.,
    effective as of November 9, 2006 (filed as
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    filed on November 9, 2006 and incorporated herein by
    reference).10
.26

Separation Agreement and Release between The Outdoor Channel,
    Inc. and Mr. Andrew J. Dale dated December 21, 2006
    (filed as Exhibit 10.1 to the Companys Current Report
    on
    Form 8-K
    filed on December 28, 2006 and incorporated herein by
    reference).10
.27

Consulting Agreement between The Outdoor Channel, Inc. and
    Mr. Andrew J. Dale dated January 2, 2007 (filed as
    Exhibit 10.2 to the Companys Current Report on
    Form 8-K
    filed on December 28, 2006 and incorporated herein by
    reference).10
.28

Form of Change of Control Severance Agreement (filed as Exhibit
    10.28 to the Companys Form 10-K dated March 17,
    2008 and incorporated herein by reference).10
.29

Amendment to Loan Agreement and Note and related agreements by
    and between the Company and U.S. Bank N.A. dated as of
    September 21, 2007 (filed as Exhibit 10.29 to the
    Companys
    Form 10-Q
    dated February 1, 2008 and incorporated herein by
    reference).10
.30

Purchase Agreement by and between The Gold Business, LLC,
    Outdoor Channel Holdings, Inc. and Gold Prospectors
    Association of America, Inc. dated April 24, 2007 (filed as
    Exhibit 10.1 to the Companys
    Form 10-Q
    dated May 10, 2007 and incorporated herein by reference).10
.31

First Amendment to Lease dated April 24, 2007, by and
    between Musk Ox Properties, L.P. and Outdoor Channel Holdings,
    Inc. (filed as Exhibit 10.2 to the Companys
    Form 10-Q
    dated May 10, 2007 and incorporated herein by reference).10
.32

Separation Agreement and Release between Outdoor Channel
    Holdings, Inc. and Mr. William A. Owen dated
    December 14, 2007 (filed as Exhibit 10.1 to the
    Companys Current Report on
    Form 8-K
    filed on December 17, 2007 and incorporated herein by
    reference).10
.33

Consulting Agreement between Outdoor Channel Holdings, Inc. and
    Mr. William A. Owen dated as of December 15, 2007
    (filed as Exhibit 10.2 to the Companys Current Report
    on
    Form 8-K
    filed on December 17, 2007 and incorporated herein by
    reference).10
.34

Form of Stock Repurchase Plan and  Agreement.10
.35

Asset Purchase Agreement by and among Cablecam LLC, Skycam LLC,
    Winnercomm Holdings, Inc and Winnercomm, Inc., and Outdoor
    Channel Holdings, Inc., dated January 12, 2009 (filed as
    Exhibit 10.1 to the Companys Current Report on
    Form 8-K
    filed on January 16, 2009 and incorporated herein by
    reference).21
.1

Subsidiaries of Registrant23
.1

Consent of J.H. Cohn LLP, Independent Registered Public
    Accounting Firm23
.2

Consent of Ernst & Young LLP, Independent Registered
    Public Accounting Firm24
.1

Power of Attorney (included on signature page)31
.1

Certification by Chief Executive Officer31
.2

Certification by Chief Financial Officer32
.1**

Section 1350 Certification by Chief Executive Officer32
.2**

Section 1350 Certification by Chief Financial Officer     *
    
    Designates a management contract or compensatory plan or
    arrangement.**
    
    Pursuant to Commission Release
    No. 33-8238,
    this certification will be treated as accompanying
    this Annual Report on
    Form 10-K
    and not filed as part of such report for purposes of
    Section 18 of the Securities Exchange Act of 1934, as
    amended, or otherwise subject to the liability of
    Section 18 of the Securities Exchange Act of 1934, as
    amended, and this certification will not be deemed to be
    incorporated by reference into any filing under the Securities
    Act of 1933, as amended, or the Securities Exchange Act of 1934,
    as amended, except to the extent that the registrant
    specifically incorporates it by reference. 80




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##### Table of Contents



SIGNATURES    OUTDOOR CHANNEL HOLDINGS, INC.
  By:
    /s/  Roger
    L. Werner, Jr.  Roger L. Werner, Jr.,
    POWER OF
    ATTORNEY
  Form 10-K,
    Signature

Title

Date/s/  Perry
    T. MassiePerry
    T. Massie

Chairman of the Board, Director

March 9, 2009/s/  Roger
    L. Werner. Jr.Roger
    L. Werner. Jr.

Chief Executive Officer and President (Principal Executive
    Officer), Director

March 9, 2009/s/  Shad
    L. BurkeShad
    L. Burke

Chief Financial Officer 
    (Principal Financial and Accounting Officer)

March 9, 2009/s/  Thomas
    H. MassieThomas
    H. Massie

Vice Chairman of the Board, Director

March 9, 2009/s/  Ajit
    M. DalviAjit
    M. Dalvi

Director

March 9, 2009/s/  David
    D. KinleyDavid
    D. Kinley

Director

March 9, 2009/s/  David
    C. MerrittDavid
    C. Merritt

Director

March 9, 2009/s/  Michael
    L. PandzikMichael
    L. Pandzik

Director

March 9, 2009/s/  T.
    Bahnson StanleyT.
    Bahnson Stanley

Director

March 9, 2009  81