##### 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,
    2010oro

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(Address of principal
    executive offices)

92590(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-T o o
  Regulation S-K Form 10-K Form 10-K. þ
  Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer þ

Non-accelerated
    filer o(Do not check if a smaller
    reporting company)

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


4Item 1A.

Risk Factors


10Item 1B.

Unresolved Staff Comments


21Item 2.

Properties


21Item 3.

Legal Proceedings


22Item 4.

Removed and Reserved


22PART IIItem 5.

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


23Item 6.

Selected Financial Data


25Item 7.

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


26Item 7A.

Quantitative and Qualitative Disclosures About
    Market Risk


43Item 8.

Financial Statements and Supplementary Data


44Item 9.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


76Item 9A.

Controls and Procedures


76Item 9B.

Other Information


78PART IIIItem 10.

Directors, Executive Officers and Corporate
    Governance


78Item 11.

Executive Compensation


78Item 12.

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


78Item 13.

Certain Relationships and Related Transactions,
    and Director Independence


78Item 14.

Principal Accountant Fees and Services


78PART IVItem 15.

Exhibits and Financial Statement Schedules


79SIGNATURES


83EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1EX-32.2   2




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Cautionary
    Statement Concerning Forward-Looking Statements
  Form 10-K
  Form 10-K
 3




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##### Table of Contents



PART I  ITEM 1.
    BUSINESS.    
    THE OUTDOOR CHANNEL:  The Outdoor Channel, or
    TOC, segment is comprised of The Outdoor Channel, Inc., a
    Delaware corporation and a wholly owned indirect subsidiary of
    Outdoor Channel Holdings, Inc. It operates Outdoor
    Channel®,

    a national television network devoted to traditional outdoor
    related lifestyle programming and outdoorchannel.com.
    PRODUCTION SERVICES:  Our Production Services
    segment is comprised of Winnercomm, Inc., a Delaware corporation
    (Winnercomm), CableCam, LLC, a Delaware limited
    liability company (CableCam) and SkyCam, LLC, a
    Delaware limited liability company (SkyCam). The
    Production Services businesses relate principally to the
    production, development and marketing of sports and outdoor
    related programming.  Form 10-K,
    ®
    TOC (66%,
    61% and 100% of the Companys consolidated revenues in
    2010, 2009 and 2008, respectively)
  ®
   4




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Outdoor
    Channel Sources of Revenue
    Advertising
    Fees
    Short-form Advertising
         5




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Long-form Advertising
  Website Advertising
  Subscriber
    Fees
    Outdoor
    Channel Programming
      Outdoor
    Channel Competition
   6




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over-the-air
    International
    Distribution
    PRODUCTION
    SERVICES (34%
    and 39% of the Companys consolidated revenues in 2010 and
    2009, respectively)
    Winnercomm.
  Winnercomm Competition.
  CableCam and SkyCam.
 7




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CableCam and SkyCam Competition.
  Production Services Revenues.
  INTELLECTUAL
    PROPERTY
  ® ® ® ®
  GOVERNMENT
    REGULATION
   8




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Local
    Cable Regulation
    Effect
    of Must-Carry Requirements
    Closed
    Captioning and Advertising Restrictions on Childrens
    Programming
    Obscenity
    Restrictions
    Regulation
    of the Internet
    Other
    Regulations
   9




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EMPLOYEES
    FINANCIAL
    INFORMATION ABOUT SEGMENTS
    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.    INDUSTRY
    RISKS AND RISKS RELATING TO OUR BUSINESS
  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
    business and our operating results.
   10




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and/or
  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.
    If our
    viewership declines for any reason, or we fail to develop and
    distribute popular programs, our advertising and subscriber fee
    revenues could decrease.
    If our
    channel is placed in unpopular program packages by our 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
 11




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Increased
    competition and demand in price for the carriage of local
    broadcast networks may limit our ability to add
    subscribers.
  over-the-air,
  A
    deterioration in general economic conditions may cause a
    decrease in, or hinder our ability to grow, our advertising
    revenues.
    A lockout
    by the owners of the NFL teams, and the strike by the NFL
    players, could cause a substantial decline in our 2011 aerial
    camera revenue.
    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 maintain sufficient revenue relating to our
    production business to offset its fixed costs, and as a result
    our profitability may decrease.
   12




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We may
    not be able to grow our subscriber base of Outdoor Channel 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 could
    have an aerial camera fall, harming our reputation and possibly
    causing damage exceeding our liability insurance
    limits.
    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 service providers may harm our business.
   13




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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.
    The
    cable, satellite and telco 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.
        Our
    investments in auction-rate securities are subject to risks
    which may affect the liquidity of these investments and could
    cause additional impairment charges.
  other-than-temporary,
 14




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We may
    not be able to secure sufficient or additional advertising
    revenue, and as a result, our profitability may be negatively
    impacted.
      Expenses
    relating to programming and production 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,
    acquiring and producing new programming.
    Our
    expansion into international operations has inherent risks,
    including currency exchange rate fluctuations, possible
    governmental seizure of property, and our inability or increased
    costs associated with enforcing our rights, including
    intellectual property rights.
    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.
   15




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over-the-air
    The
    satellite infrastructure that we use may fail or be preempted by
    another signal, which could impair our ability to deliver
    programming to our 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
    not be able to attract and retain key personnel.
   16




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Cable,
    satellite and telco 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.
    Technologies
    in the pay television industry are constantly changing, and our
    failure to acquire or maintain
    state-of-the-art
    technology or adapt our business model may harm our business and
    competitive advantage.
   17




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RISKS
    RELATED TO INVESTMENT IN OUR COMMON STOCK
  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.
    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
  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.
   18




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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 service providers;
    changes in our estimates of contingent liabilities;
    demand for advertising, advertising rates and offerings of
    competing media;
    changes in the growth rate of cable, satellite and telco
    subscribers;
    service providers capital and marketing expenditures and
    their impact on programming offerings and penetration;
    seasonal trends in viewer interests and activities;
    our advertising sales, for both Outdoor Channel and our
    Production Services, tend to be more robust during the second
    half of each year, while expenses remain relatively constant
    throughout the year;
    pricing, service, marketing and acquisition decisions that could
    reduce revenues and impair quarterly financial results;
    the mix of cable television, satellite-delivered and telco
    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;
    our need to retain some employees on a full-time basis
    throughout the year so that we have the minimally necessary
    personnel available during the busiest seasons;
    the necessity to do some projects that may be minimally
    profitable, if at all, in order to establish a business
    relationship with a strategic customer;
    specific economic conditions in the pay 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.
    Changes
    in corporate governance and securities disclosure and compliance
    practices have increased and may continue to increase our legal
    compliance and financial reporting costs.
    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.
    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.
   20




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
    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;
    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.    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.    ITEM 2.
    PROPERTIES.   21




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ITEM 3.
    LEGAL
    PROCEEDINGS.          ITEM 4.
    REMOVED
    AND RESERVED. 22




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PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES.  Market
    Information
    High

Low2010First Quarter


6.77



5.02Second Quarter


7.14



4.48Third Quarter


6.01



4.58Fourth Quarter


7.17



5.202009First Quarter


7.79



3.65Second Quarter


7.72



5.51Third Quarter


7.84



5.90Fourth Quarter


7.25



5.50       DIVIDEND
    POLICY
    ISSUER
    PURCHASES OF EQUITY SECURITIES
  Rule 10b-18
  Total Number


Maximumof Shares


Approximate DollarPurchased as


Value that May YetTotal Number





Part of Publicly


Be Used to Purchaseof Shares


Average Price


Announced


Shares Under thePeriod

Purchased


Paid per Share


Program


ProgramMarch 3, 2009 through
    December 31, 2009


225,713


$
5.79



225,713


$
8,657,226January 1, 2010 through
    March 31, 2010


62,418


$
5.43



62,418


$
8,316,078Total


288,131


$
5.61



288,131  23




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PERFORMANCE
    GRAPH
      Outdoor
    Channel Holdings, Inc.
    Performance Graph
    Comparison of Cumulative Total Return*
  
  *
    
    Assumes $100 investment in Companys common stock on
    December 31, 2005 24




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ITEM 6.
    SELECTED
    FINANCIAL DATA.    Year Ended December 31,2010


2009


2008


2007


2006(In thousands, except per share amounts)Statement of Operations Data:Revenues:Advertising

$
37,000


$
34,325


$
36,562


$
29,149


$
25,034Subscriber fees


17,953



18,848



17,495



17,297



17,686Production services


28,389



33,679











Total revenues


83,342



86,852



54,057



46,446



42,720Income (loss) from operations


4,586



1,910



4,839



(3,441
)


(13,598
)Income (loss) before income taxes


4,617



1,983



6,360



(161
)


(11,153
)Income tax provision (benefit)


3,373



2,268



3,988



1,718



(3,876
)Net income (loss) from continuing operations


1,244



(285
)


2,372



(1,879
)


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














1



289Net income (loss)

$
1,244


$
(285
)

$
2,372


$
(1,878
)

$
(6,988
)Earnings (loss) from continuing operations per common share:Basic

$
0.05


$
(0.01
)

$
0.09


$
(0.07
)

$
(0.30
)Diluted

$
0.05


$
(0.01
)

$
0.09


$
(0.07
)

$
(0.30
)Earnings (loss) per common share:Basic

$
0.05


$
(0.01
)

$
0.09


$
(0.07
)

$
(0.28
)Diluted

$
0.05


$
(0.01
)

$
0.09


$
(0.07
)

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


24,513



24,452



25,369



26,027



24,556Diluted


25,634



24,452



26,086



26,027



24,556   25




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As of December 31,2010

2009

2008

2007

2006(In thousands)Balance Sheet Data:Cash and cash equivalents

$
32,578


$
20,848


$
60,257


$
25,260


$
14,226Investments in auction-rate and
    available-for-sale
    securities:Current


26,995



38,090







46,155



42,144Non-current


5,075



5,775



6,456







Goodwill


43,160



43,160



43,160



43,160



43,816Other assets


45,844



48,905



33,081



37,126



44,764Total assets


153,652



156,778



142,954



151,701



144,950Total liabilities


18,110



18,480



6,545



5,124



6,004Stockholders equity


135,542



138,298



136,409



146,577



138,946   ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS.  Safe
    Harbor Statement
  Form 10-K
  Form 10-K
    
    Overview.  The overview section provides a
    summary of our business.
    Consolidated Results of Operations.  The
    consolidated results of operations section provides an analysis
    of our results on a consolidated basis for the year ended
    December 31, 2010 compared to the year ended
    December 31, 2009. 26




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
    Segment Results of Operations.  The segment
    results of operations section provides an analysis of our
    results on a reportable operating segment basis for the year
    ended December 31, 2010 compared to the year ended
    December 31, 2009.
    Consolidated and Segment Results of
    Operations.  The consolidated results of
    operations section provides an analysis of our results on a
    consolidated and by segment basis for the year ended
    December 31, 2009 compared to the year ended
    December 31, 2008.
    Liquidity and Capital Resources.  The liquidity
    and capital resources section provides a discussion of our cash
    flows for the year ended December 31, 2010 compared to the
    year ended December 31, 2009.  OVERVIEW
    The
    Outdoor Channel
       27




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Production
    Services
         28




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Critical
    Accounting Policies and Estimates
      Revenue
    Recognition
           29




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Valuation
    of Goodwill
           30




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Prepaid
    Programming Costs
    Share-Based
    Compensation
      Income
    Taxes
        Recent
    Accounting Pronouncements
   31




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CONSOLIDATED
    RESULTS OF OPERATIONS
  Overview
   32




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Comparison of Consolidated Operating Results for the Years
    Ended December 31, 2010 and December 31, 2009
    Change


% of Total Revenue2010


2009


$


%


2010


2009Revenues:Advertising

$
37,000


$
34,325


$
2,675



8
%


44
%


40
%Subscriber fees


17,953



18,848



(895
)


(5
)


22



22Production services


28,389



33,679



(5,290
)


(16
)


34



39Total revenues


83,342



86,852



(3,510
)


(4
)


100



100Cost of services:Programming


6,139



5,902



237



4



7



7Satellite transmission fees


1,584



1,597



(13
)


(1
)


2



2Production and operations


29,036



34,973



(5,937
)


(17
)


35



40Other direct costs


447



563



(116
)


(21
)


1



1Total cost of services


37,206



43,035



(5,829
)


(14
)


45



50Other expenses:Advertising


3,521



2,779



742



27



4



3Selling, general and administrative


34,646



35,131



(485
)


(1
)


42



40Depreciation and amortization


3,383



3,997



(614
)


(15
)


4



5Total other expenses


41,550



41,907



(357
)


(1
)


50



48Income from operations


4,586



1,910



2,676



140



6



2Interest and other income, net


31



73



(42
)


(58
)






Income from operations before income taxes


4,617



1,983



2,634



133



6



2Income tax provision


3,373



2,268



1,105



49



4



3Net income (loss)

$
1,244


$
(285
)

$
1,529



(536
)%


2
%



%      Revenues
    Cost of
    Services
    Other
    Expenses
   33




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Income
    from Operations
    Interest
    and Other Income, Net
    Income
    from Operations Before Income Taxes
    Income
    Tax Provision
    Net
    Income (Loss)
    SEGMENT
    RESULTS OF OPERATIONS
   34




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TOC
  Comparison
    of Operating Results for the for the Years Ended
    December 31, 2010 and December 31, 2009
    Change2010


2009


$


%Revenues:Advertising

$
37,000


$
34,325


$
2,675



8
%Subscriber fees


17,953



18,848



(895
)


(5
)Total revenues


54,953



53,173



1,780



3Cost of services:Programming


6,722



6,248



474



8Satellite transmission fees


1,584



1,597



(13
)


(1
)Production and operations


6,875



6,072



803



13Other direct costs


447



563



(116
)


(21
)Total cost of services


15,628



14,480



1,148



8Other expenses:Advertising


3,491



2,785



706



25Selling, general and administrative


26,223



27,370



(1,147
)


(4
)Depreciation and amortization


1,652



2,058



(406
)


(20
)Total other expenses


31,366



32,213



(847
)


(3
)Income from operations


7,959



6,480



1,479



23Interest and other income, net


121



171



(50
)


(29
)Income from operations before income taxes

$
8,080


$
6,651


$
1,429



21
%   Revenues
      Cost of
    Services
       35




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Other
    Expenses
        Income
    from Operations
    Interest
    and Other Income, Net
  available-for-sale
 36




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Production
    Services
  Comparison
    of Operating Results for the for the Years Ended
    December 31, 2010 and December 31, 2009
    Change2010


2009


$


%Revenues:Production services

$
30,646


$
35,644


$
(4,998
)


(14
)%Total revenues


30,646



35,644



(4,998
)


(14
)Cost of services:Production and operations


23,843



30,217



(6,374
)


(21
)Total cost of services


23,843



30,217



(6,374
)


(21
)Other expenses:Advertising


30



54



(24
)


(44
)Selling, general and administrative


8,423



7,761



662



9Depreciation and amortization


1,731



1,939



(208
)


(11
)Total other expenses


10,184



9,754



430



4Loss from operations


(3,381
)


(4,327
)


946



(22
)Interest and other income, net


(90
)


(98
)


8



(8
)Loss from operations before income taxes

$
(3,471
)

$
(4,425
)

$
954



(22
)%   Revenues
    Cost of
    Services
    Other
    Expenses
  3-D
   37




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Loss from
    Operations
    CONSOLIDATED
    AND SEGMENT RESULTS OF OPERATIONS
  Comparison of Consolidated Operating Results for the Years
    Ended December 31, 2009 and December 31, 2008
    Change


% of Total Revenue2009


2008


$


%


2009


2008Revenues:Advertising

$
34,325


$
36,562


$
(2,237
)


(6
)%


40
%


68
%Subscriber fees


18,848



17,495



1,353



8



22



32Production services


33,679







33,679



100



39



Total revenues


86,852



54,057



32,795



61



100



100Cost of services:Programming


5,902



6,903



(1,001
)


(15
)


7



13Satellite transmission fees


1,597



1,971



(374
)


(19
)


2



4Production and operations


34,973



5,892



29,081



494



40



11Other direct costs


563



383



180



47



1



1Total cost of services


43,035



15,149



27,886



184



50



28Other expenses:Advertising


2,779



3,317



(538
)


(16
)


3



6Selling, general and administrative


35,131



28,305



6,826



24



40



52Depreciation and amortization


3,997



2,447



1,550



63



5



5Total other expenses


41,907



34,069



7,838



23



48



63Income from operations


1,910



4,839



(2,929
)


(61
)


2



9Interest and other income, net


73



1,521



(1,448
)


(95
)






3Income from operations before income taxes


1,983



6,360



(4,377
)


(69
)


2



12Income tax provision


2,268



3,988



(1,720
)


(43
)


3



7Net income (loss)

$
(285
)

$
2,372


$
(2,657
)


(112
)%



%


4
%      Revenues
     38




---



##### Table of Contents



Cost of
    Services
             39




---



##### Table of Contents



Other
    Expenses
            Income
    from Operations
    Interest
    and Other Income, Net
  available-for-sale
  Income
    from Operations Before Income Taxes
   40




---



##### Table of Contents



Income
    Tax Provision
    Net
    Income (Loss)
    Liquidity
    and Capital Resources
    available-for-sale available-for-sale
  available-for-sale
 41




---



##### Table of Contents



Less than








AfterContractual Obligations

Total


1 year


1 - 3 years


3 - 5 years


5 yearsOperating lease obligations

$
7,619


$
2,001


$
3,160


$
2,283


$
175Purchase obligations


5,269



3,918



1,351







Employment agreements


3,601



1,847



1,754







Total

$
16,489


$
7,766


$
6,265


$
2,283


$
175    42




---



##### Table of Contents



ITEM 7A.
    QUANTITATIVE
    AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.      line-of-credit
 43




---



##### Table of Contents



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA. INDEX  Report of Independent Registered Public
    Accounting Firm


45Consolidated Balance Sheets as of
    December 31, 2010 and 2009


46Consolidated Statements of Operations for the
    Years Ended December 31, 2010, 2009 and 2008


47Consolidated Statements of Stockholders
    Equity for the Years Ended December 31, 2010, 2009 and
    2008


48Consolidated Statements of Cash Flows for the
    Years Ended December 31, 2010, 2009 and 2008


51Notes to Consolidated Financial Statements


52   * *
    *
 44




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM            
    45




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Balance Sheets
 As of
    December 31, 2010 and 2009
  2010


2009(In thousands, exceptper share data)ASSETSCurrent assets:Cash and cash equivalents

$
32,578


$
20,848Investments in
    available-for-sale
    securities


26,995



38,090Accounts receivable, net of allowance for doubtful accounts of
    $1,394 and $620


16,754



15,827Income tax refund receivable


13



Deferred tax assets, net


2,944



2,434Prepaid programming and production costs


5,228



6,111Other current assets


2,805



1,871Total current assets


87,317



85,181Property, plant and equipment, net


12,315



14,286Amortizable intangible assets, net


513



828Goodwill


43,160



43,160Investments in auction-rate securities


5,075



5,775Deferred tax assets, net


1,774



2,489Subscriber acquisition fees


2,963



4,371Deposits and other assets


535



688Totals

$
153,652


$
156,778LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses

$
14,011


$
15,079Deferred revenue


516



1,469Current portion of deferred obligations


54



165Current portion of unfavorable lease


149



136Income taxes payable


2,399



459Total current liabilities


17,129



17,308Deferred obligations


136



178Unfavorable lease


845



994Total liabilities


18,110



18,480Commitments and contingenciesStockholders equity:Preferred stock, $0.001 par value; 25,000 shares
    authorized; none issued






Common stock, $0.001 par value; 75,000 shares
    authorized; 25,354 and 25,444 shares issued and outstanding


25



25Additional paid-in capital


167,437



165,374Accumulated other comprehensive loss


(352
)


(444
)Accumulated deficit


(31,568
)


(26,657
)Total stockholders equity


135,542



138,298Totals

$
153,652


$
156,778    46




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Operations
 For the
    Years Ended December 31, 2010, 2009 and 2008
  2010


2009


2008(In thousands, except per share data)Revenues:Advertising

$
37,000


$
34,325


$
36,562Subscriber fees


17,953



18,848



17,495Production services


28,389



33,679



Total revenues


83,342



86,852



54,057Cost of services:Programming


6,139



5,902



6,903Satellite transmission fees


1,584



1,597



1,971Production and operations


29,036



34,973



5,892Other direct costs


447



563



383Total cost of services


37,206



43,035



15,149Other expenses:Advertising


3,521



2,779



3,317Selling, general and administrative


34,646



35,131



28,305Depreciation and amortization


3,383



3,997



2,447Total other expenses


41,550



41,907



34,069Income from operations


4,586



1,910



4,839Interest and other income, net


31



73



1,521Income from operations before income taxes


4,617



1,983



6,360Income tax provision


3,373



2,268



3,988Net income (loss)

$
1,244


$
(285
)

$
2,372Earnings (loss) per common share data:Basic

$
0.05


$
(0.01
)

$
0.09Diluted

$
0.05


$
(0.01
)

$
0.09Weighted average number of common shares outstanding:Basic


24,513



24,452



25,369Diluted


25,634



24,452



26,086    47




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Stockholders Equity
 For the
    Years Ended December 31, 2010, 2009 and 2008
  AccumulatedAdditional


OtherCommon Stock


Paid-in


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


Total(In thousands)Balance, January 1, 2010


25,444


$
25


$
165,374


$
(444
)

$
(26,657
)

$
138,298Comprehensive Income:Net income


















1,244



1,244Change in fair value of auction-rate securities














92







92Total comprehensive income






















1,336Special one-time dividends paid in cash


















(6,155
)


(6,155
)Issuance of restricted stock to employees for services to be
    rendered, net of forfeited shares


114



















Share-based employee and service provider compensation expense










3,244











3,244Purchase and retirement of treasury stock related to employee
    and service provider share-based compensation activity


(142
)






(840
)










(840
)Purchase and retirement of treasury stock related to the stock
    repurchase program


(62
)






(341
)










(341
)Balance, December 31, 2010


25,354


$
25


$
167,437


$
(352
)

$
(31,568
)

$
135,542    48




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Stockholders Equity
 For
    the Years Ended December 31, 2010, 2009 and 2008
   AccumulatedAdditional


OtherCommon Stock


Paid-in


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


Total(In thousands)Balance, January 1, 2009


25,246


$
25


$
163,300


$
(327
)

$
(26,589
)

$
136,409Comprehensive Income (Loss):Net loss


















(285
)


(285
)Cumulative effect of adoption of ASC 320














(217
)


217



Change in fair value of auction-rate securities














100







100Total comprehensive loss






















(185
)Issuance of restricted stock to employees and service providers
    for services to be rendered, net of forfeited shares


525



1















1Share-based employee and service provider compensation expense










4,100











4,100Purchase and retirement of treasury stock related to employee
    and service provider share-based compensation activity


(101
)






(659
)










(659
)Purchase and retirement of treasury stock related to the stock
    repurchase program


(226
)


(1
)


(1,344
)










(1,345
)Tax shortfalls from share-based payments










(23
)










(23
)Balance, December 31, 2009


25,444


$
25


$
165,374


$
(444
)

$
(26,657
)

$
138,298    49




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Consolidated
    Statements of Stockholders Equity
 For
    the Years Ended December 31, 2010, 2009 and 2008
  AccumulatedAdditional


OtherCommon Stock


Paid-in


Comprehensive


AccumulatedShares


Amount


Capital


Income (Loss)


Deficit


Total(In thousands)Balance, January 1, 2008


26,870


$
27


$
175,570


$
(59
)

$
(28,961
)

$
146,577Comprehensive Income:Net income


















2,372



2,372Change 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 the 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    50




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIESConsolidated Statements of Cash FlowsFor the Years Ended December 31, 2010,
    2009 and 2008
  2010


2009


2008(In thousands)Operating activities:Net income (loss)

$
1,244


$
(285
)

$
2,372Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activities:Depreciation and amortization


3,383



3,997



2,447Amortization of subscriber acquisition fees


1,619



974



489Loss on sale of equipment


133



74



36Gain on sale of
    available-for-sale
    and auction-rate securities


(11
)


(12
)


(75
)Other-than-temporary
    impairment on auction-rate securities










336Provision for doubtful accounts


1,062



524



709Share-based employee and service provider compensation


3,244



4,100



3,605Deferred tax provision, net


205



1,527



3,249Changes in operating assets and liabilities:Accounts receivable


(1,989
)


(1,213
)


(1,853
)Income tax refund receivable and payable, net


1,927



429



224Prepaid programming costs


882



(555
)


(475
)Other current assets


(934
)


229



(158
)Deposits and other assets


109



(93
)


(205
)Subscriber acquisition fees


(2,129
)


(1,078
)


Accounts payable and accrued expenses


777



(1,305
)


1,663Customer deposits










(14
)Deferred revenue


(953
)


849



(56
)Deferred obligations


(152
)


(19
)


(50
)Unfavorable lease obligations


(136
)


(121
)


Net cash provided by operating activities


8,281



8,022



12,244Investing activities:Purchases of property, plant and equipment


(1,253
)


(2,526
)


(857
)Purchase of intangibles










(97
)Proceeds from sale of equipment


102



142



74Cash paid to purchase assets of Winnercomm, net of cash acquired






(5,746
)


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


(103,964
)


(37,997
)


(27,181
)Proceeds from sale of
    available-for-sale
    and auction-rate securities


115,900



700



66,352Net cash provided by (used in) investing activities


10,785



(45,427
)


38,291Financing activities:Proceeds from exercise of stock options










11Purchase and retirement of stock related to stock repurchase
    program


(341
)


(1,345
)


(15,000
)Payment of dividends on common stock


(6,155
)






Purchase of treasury stock


(840
)


(659
)


(549
)Net cash used in financing activities


(7,336
)


(2,004
)


(15,538
)Net increase (decrease) in cash and cash equivalents


11,730



(39,409
)


34,997Cash and cash equivalents, beginning of year


20,848



60,257



25,260Cash and cash equivalents, end of year

$
32,578


$
20,848


$
60,257Supplemental disclosure of cash flow information:Interest paid

$



$
1


$
Income taxes paid

$
1,230


$
282


$
514Supplemental disclosures of non-cash investing and financing
    activities:Issuance of restricted stock to employees for services rendered

$
1,362


$
4,259


$
3,713Effect of net increase (decrease) in fair value of auction-rate
    and
    available-for-sale
    securities

$
92


$
100


$
(268
)Property, plant and equipment costs incurred but not paid

$
35


$
50


$
17Subscriber acquisition fees incurred but not paid

$
186


$
3,046


$
    51




---



##### 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
    Critical
    Accounting Policies and Estimates
   52




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Note 2 
    Summary
    of Significant Accounting Policies  Cash
    and Cash Equivalents
    Subscriber
    Acquisition Fees
      Prepaid
    Programming Costs
    Property,
    Plant and Equipment
   53




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Buildings and improvements

10 - 39 yearsEquipment

3 - 5 yearsFurniture and fixtures

2 - 7 yearsVehicles

7 yearsLeasehold improvements

0.5 - 10 years   Amortizable
    Intangible Assets
    Long-Lived
    Assets
    Goodwill
       54




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
        Advertising
    Expense
    Revenue
    Recognition
           55




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    agreed-upon
      Income
    Taxes
       56




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
  Earnings
    (Loss) Per Share
      2010


2009


2008Weighted average shares used to calculate basic earnings (loss)
    per share


24,513



24,452



25,369Dilutive effect of potentially issuable common shares upon
    exercise of dilutive stock options, performance units, unvested
    restricted stock and stock units


1,121







717Weighted average shares used to calculate diluted earnings
    (loss) per share


25,634



24,452



26,086     Share-Based
    Compensation
      Investments
  available-for-sale
    Recent
    Accounting Pronouncements
   57




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
          Note 3 
    Acquisition    Unaudited
    Pro Forma Financial Information
   58




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Year EndedDecember 31, 2009Total revenues

$
87,800Net loss

$
(1,004
)Basic loss per share

$
(0.04
)Diluted loss per share

$
(0.04
)   Note 4 
    Subscriber
    Acquisition Fees    2010


2009Subscriber acquisition fees, at cost

$
6,780


$
6,569Accumulated amortization


(3,817
)


(2,198
)Subscriber acquisition fees, net

$
2,963


$
4,371     Years Ending December 31,

Amount2011

$
1,5022012


1,0402013


4212014


Total amortization

$
2,963     Note 5 
    Investments
    in
    Available-For-Sale
    Securities    Level 1
  Level 2
  Level 3
 59




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Quoted Prices


Significantin Active


Other


SignificantMarkets for


Observable


UnobservableIdentical Assets


Inputs


InputsTotal


(Level 1)


(Level 2)


(Level 3)Cash and cash equivalents(1)

$
32,578


$
32,578


$



$
Investments in
    available-for-sale
    securities(2)


26,995



26,995







Non-current investments in auction-rate securities(3)


5,075











5,075Total

$
64,648


$
59,573


$



$
5,075     (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 treasury bills with original maturity
    dates in excess of three months, for which we determine fair
    value through quoted market prices.(3)
    
    Investments in auction-rate securities consist of one
    auction-rate municipal security and one closed-end perpetual
    preferred auction-rate security (PPS). We use a
    discounted cash flow analysis to more accurately measure
    possible liquidity discounts.  other-than-temporary
 60




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
  available-for-sale
    Year Ended December 31,2010


2009Auction-Rate Securities:Balance at beginning of period

$
5,775


$
6,456Redeemed


(803
)


(793
)Realized gain on redemption


11



12Unrealized gain included in accumulated other comprehensive loss


92



100Balance as of December 31, 2010

$
5,075


$
5,775     Year Ended December 31,2010


2009


2008Interest income

$
116


$
166


$
1,750Interest expense


(96
)


(105
)


Dividend income










32Loss on sale of equity securities










(44
)Gain on redemption of auction-rate securities


11



12



119Other-than-temporary
    impairment on auction-rate securities










(336
)Total interest and other income, net

$
31


$
73


$
1,521   Note 6 
    Comprehensive
    Income (Loss)    2010


2009


2008Net income (loss), as reported

$
1,244


$
(285
)

$
2,372Change in fair value of auction-rate and
    available-for-sale
    securities


92



100



(268
)Comprehensive income (loss)

$
1,336


$
(185
)

$
2,104  61




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
  Note 7 
    Property,
    Plant and Equipment    2010


2009Land

$
726


$
618Buildings and improvements


6,939



7,119Equipment


15,163



14,547Furniture and fixtures


779



954Vehicles


114



168Leasehold improvements


961



1,49324,682



24,899Less accumulated depreciation


(12,367
)


(10,613
)Totals

$
12,315


$
14,286     Note 8 
    Goodwill
    and Intangible Assets      2010AccumulatedGross


Amortization


NetTrademark

$
219


$
203


$
16Internet domain names


98



98



Customer relationships


2,952



2,503



449Patents


80



32



48Programming library


50



50



Total intangible assets

$
3,399


$
2,886


$
513   2009AccumulatedGross


Amortization


NetTrademark

$
219


$
189


$
30Internet domain names


98



49



49Customer relationships


2,952



2,269



683Patents


80



16



64Programming library


50



48



2Total intangible assets

$
3,399


$
2,571


$
828    62




---



##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
      Years Ending December 31,

Amount2011

$
1802012


1672013


1622014 and thereafter


4Total

$
513   Note 9 
    Lines of
    Credit    Note 10 
    Commitments
    and Contingencies      Less than








AfterContractual Obligations

Total


1 year


1 - 3 years


3 - 5 years


5 yearsOperating lease obligations

$
7,619


$
2,001


$
3,160


$
2,283


$
175Purchase obligations


5,269



3,918



1,351







Employment agreements


3,601



1,847



1,754







Total

$
16,489


$
7,766


$
6,265


$
2,283


$
175      63




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
      Operating
    Leases
             64




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Years Ending December 31,

Amount2011

$
2,0012012


1,6972013


1,4632014


1,4382015 and thereafter


1,020Total

$
7,619   Note 11 
    Income
    Taxes    2010


2009


2008Current:Federal

$
2,601


$
538


$
225State


567



202



541Total current


3,168



740



766Deferred:Federal


210



1,196



3,239State


(5
)


332



(17
)Total deferred


205



1,528



3,222Totals

$
3,373


$
2,268


$
3,988  65




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    2010


2009Deferred tax assets:Net operating loss carryforwards

$
904


$
754Share-based compensation


3,348



4,547Deferred revenues


82



94Other accrued liabilities


1,024



408Intangible assets


237



138Allowance for doubtful accounts


497



218Programming costs


349



346Capital loss carryover


425



456Other


161



71Subtotal


7,027



7,032Less: Valuation allowance


(748
)


(637
)$
6,279


$
6,395Deferred tax liabilities:Property, plant and equipment


(1,202
)


(1,115
)State taxes


(359
)


(357
)(1,561
)


(1,472
)Deferred tax assets, net

$
4,718


$
4,923    66




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    2010


2009


2008Federal income tax provision at statutory income tax rate

$
1,569


$
674


$
2,162State taxes, net of federal benefit


405



160



346Non-deductible expense


52



46



41Share-based compensation


1,319



568



925Officer compensation


101



647



418Valuation allowance


(5
)


(5
)


89State rate adjustment


(34
)


193



Other


(34
)


(15
)


7Income tax provision

$
3,373


$
2,268


$
3,988     2010


2009


2008Gross unrecognized tax benefits as of January 1,

$
843


$
1,309


$
1,309Increases in tax positions for prior years










Decreases in tax positions for prior years






(466
)


Settlements










Lapse in statute of limitations










Gross unrecognized tax benefits as of December 31,

$
843


$
843


$
1,309       Note 12 
    Stock
    Incentive Plans     67




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
      2004 Long-Term Incentive Plan (LTIP
    Plan).
  Non-Employee Director Stock Option Plan
    (NEDSOP).
   68




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    December 31,2010


2009


2008Nature of Award:Restricted stock

$
2,808


$
3,681


$
3,004RSUs


361







Options


35



419



601Performance vesting


40







Total share-based compensation expense

$
3,244


$
4,100


$
3,605   December 31,2010


2009


2008Classification of Compensation Expense:Cost of services:Production and operations

$
216


$
270


$
440Other expenses:Selling, general and administrative


3,028



3,830



3,165Total share-based compensation expense

$
3,244


$
4,100


$
3,605     Issuances
    of Common Stock by the Company
    2010


2009


2008Number of options exercised










2Cash proceeds

$



$



$
11Tax benefit from options exercised

$



$



$
2  69




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
  Stock
    Options
    WeightedWeighted


AverageAverage


Remaining


AggregateExercise


Contractual


IntrinsicShares


Price


Term (Yrs.)


Value(In thousands)








(In thousands)Outstanding at January 1, 2008


1,442


$
12.48Granted






Exercised


(2
)


6.14Forfeited


(23
)


12.11Expired


(587
)


11.92Outstanding at December 31, 2008


830



12.90Granted






Exercised






Forfeited


(3
)


12.58Expired


(177
)


14.09Outstanding at December 31, 2009


650



12.58Granted






Exercised






Forfeited






Expired


(15
)


14.95Outstanding at December 31, 2010


635


$
12.52



1.58


$
Vested and expected to vest at December 31, 2010


635


$
12.52



1.58


$
Exercisable at December 31, 2010


635


$
12.52



1.58


$
     Options Outstanding


Options ExercisableWeightedAverage


Weighted





WeightedRemaining


Average





AverageRange of

Number





Contractual


Exercise


Number


ExerciseExercise Prices

Outstanding





Term (Yrs.)


Price


Exercisable


Price(In thousands)











(In thousands)$10.19 - $10.19


10







0.25


$
10.19



10


$
10.19$12.10 - $12.10


300







0.79



12.10



300



12.10$12.50 - $12.50


125







2.96



12.50



125



12.50$12.58 - $12.58


25







0.42



12.58



25



12.58$12.80 - $12.80


125







3.04



12.80



125



12.80$14.86 - $14.86


50







0.05



14.86



50



14.86Total


635







1.58


$
12.52



635


$
12.52  70




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Restricted
    Stock
    WeightedAverageGrant-DateShares


Fair Value(In thousands)Nonvested at January 1, 2008


697


$
10.25Granted


504



7.37Vested


(256
)


10.62Forfeited


(96
)


9.96Nonvested at December 31, 2008


849



8.46Granted


611



6.97Vested


(375
)


8.89Forfeited


(36
)


7.96Nonvested at December 31, 2009


1,049



7.46Granted


260



5.20Vested


(448
)


7.61Forfeited


(148
)


6.87Nonvested at December 31, 2010


713


$
6.65     Restricted
    Stock Units
    WeightedNumber of


AverageRestricted


Grant-DateStock Units


Fair Value(In thousands)RSUs outstanding at beginning of period





$
Granted


101



5.97Vested






Forfeited






Nonvested at December 31, 2010


101


$
5.97  71




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Expense
    to be Recognized
    As of December 31, 2010WeightedAverageRemainingExpense


RequisiteYet to be


ServiceRecognized


PeriodsRestricted stock

$
3,182



2.0 yearsRSUs


238



0.4 yearTotal

$
3,420



1.9 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     Dividends
    Note 13 
    Segment
    Information   72




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
      Year EndedDecember 31,Revenues

2010


2009TOC

$
54,953


$
53,173Production Services


30,646



35,644Eliminations


(2,257
)


(1,965
)Total revenues

$
83,342


$
86,852   Year EndedDecember 31,Income (Loss) Before Income Taxes

2010


2009TOC*

$
8,080


$
6,651Production Services*


(3,471
)


(4,425
)Eliminations


8



(243
)Total income before income taxes

$
4,617


$
1,983   As ofDecember 31,Total Assets

2010


2009TOC

$
87,783


$
88,015Production Services


6,833



11,379Corporate assets*


59,270



57,627Eliminations


(234
)


(243
)Total assets

$
153,652


$
156,778   Year EndedDecember 31,Depreciation and Amortization

2010


2009TOC

$
1,652


$
2,058Production Services


1,731



1,939Total

$
3,383


$
3,997  73




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    *
    
    Corporate overhead expenses consist primarily of executive,
    legal and administrative functions not associated directly with
    either TOC or Production Services. We allocate a portion of
    these expenses to our Production Services segment, but the
    majority is captured in our TOC segment. Corporate assets
    consist primarily of cash not held in our operating accounts and
    available-for-sale
    securities.  Note 14 
    Related
    Party Transactions        Note 15 
    Concentration
    of Credit Risk  available-for-sale
      Balance at


Additions





Balance atBeginning


Charged





End ofof Year


to Expense


Deductions


YearYear ended December 31, 2010

$
620


$
1,062


$
(288
)

$
1,394Year ended December 31, 2009


891



524



(795
)


620Year ended December 31, 2008


240



709



(58
)


891   Note 16 
    401(k)
    Savings Plan   74




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##### Table of Contents



OUTDOOR
    CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
  Notes to
    Consolidated Financial
    Statements  (Continued)
 (In thousands, except per share data)
    Note 17 
    Accounts
    Payable and Accrued Expenses    2010


2009Trade accounts payable

$
3,137


$
4,849Accrued payroll and related expenses


3,554



4,743Estimated make-good accrual


1,587



281Estimated most-favored nation accrual


1,750



260Accrued launch support commitment


185



3,046Accrued expenses


3,798



1,900Total

$
14,011


$
15,079   Note 18 
    Quarterly
    Financial Information (Unaudited)    Three Months EndedMarch 31


June 30


September 30


December 312010Revenue

$
17,821


$
16,829


$
22,899


$
25,793Income (loss) from operations


(2,679
)


(1,656
)


4,546



4,375Net income (loss)


(1,513
)


(1,156
)


2,440



1,473Earnings (loss) per common share:Basic

$
(0.06
)

$
(0.05
)

$
0.10


$
0.06Diluted

$
(0.06
)

$
(0.05
)

$
0.10


$
0.06   Three Months EndedMarch 31


June 30


September 30


December 312009Revenue

$
16,976


$
19,213


$
23,630


$
27,033Income (loss) from operations


(2,335
)


(1,272
)


2,028



3,489Net income (loss)


(1,314
)


(937
)


1,401



565Earnings (loss) per common share:Basic

$
(0.05
)

$
(0.04
)

$
0.06


$
0.02Diluted

$
(0.05
)

$
(0.04
)

$
0.05


$
0.02   Note 19 
    Subsequent
    Events    * * *
 75




---



##### 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(e)
    Form 10-K
 76




---



##### Table of Contents



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                
    77




---



##### 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.   78




---



##### 



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.
  Financial Statements
   
 Index to Financial Statements


44Reports of Independent Registered Public
    Accounting Firms


45Consolidated Balance Sheets


46Consolidated Statements of Operations


47Consolidated Statements of Stockholders
    Equity


48Consolidated Statements of Cash Flows


51Notes to Consolidated Financial Statements


52    Financial Statement Schedules
    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 1995 and incorporated herein by reference). 79




---



##### Table of Contents



ExhibitNumber

Description10
.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).10
.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 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). 80




---



##### Table of Contents



ExhibitNumber

Description10
.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).10
.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 (filed as
    Exhibit 10.34 to the Companys
    Form 10-K
    dated March 9, 2009 and incorporated herein by reference).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).10
.36*

Amended and Restated Employment Agreement with Roger L. Werner,
    Jr. dated April 14, 2009 (filed as Exhibit 99.1 to the
    Companys Current Report on
    Form 8-K
    filed on April 20, 2009 and incorporated herein by
    reference).10
.37*

Employment Agreement with Thomas E. Hornish dated April 14,
    2009 (filed as Exhibit 99.2 to the Companys Current
    Report on
    Form 8-K
    filed on April 20, 2009 and incorporated herein by
    reference).10
.38*

Employment Agreement with Shad L. Burke dated April 14,
    2009 (filed as Exhibit 99.3 to the Companys Current
    Report on
    Form 8-K
    filed on April 20, 2009 and incorporated herein by
    reference).10
.39*

Employment Agreement with James E. Wilburn dated May 6,
    2009 (filed as Exhibit 99.1 to the Companys Current
    Report on
    Form 8-K
    filed on May 8, 2009 and incorporated herein by reference).10
.40

Amendment to Loan Agreement and Note dated September 14,
    2009 by and between U.S. Bank N.A. and Outdoor Channel Holdings,
    Inc. (filed as Exhibit 10.1 to the Companys Current
    Report on
    Form 8-K
    filed on September 24, 2009 and incorporated herein by
    reference). 81




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##### Table of Contents



ExhibitNumber

Description10
.41

Separation Agreement and Release between Outdoor Channel
    Holdings, Inc. and Mr. Shad L. Burke dated March 19,
    2010 (filed as Exhibit 10.1 to the Companys Current
    Report on
    Form 8-K
    filed on March 24, 2010 and incorporated herein by
    reference).10
.42

Consulting Agreement between Outdoor Channel Holdings, Inc. and
    Mr. Shad L. Burke dated March 19, 2010 (filed as
    Exhibit 10.2 to the Companys Current Report on
    Form 8-K
    filed on March 24, 2010 and incorporated herein by
    reference).10
.43*

Employment Agreement with Douglas J. Langston dated
    June 28, 2010 (filed as Exhibit 99.2 to the
    Companys Current Report on
    Form 8-K
    filed on July 1, 2010 and incorporated herein by reference).10
.44*

Employment Agreement with Thomas D. Allen dated June 29,
    2010 (filed as Exhibit 99.3 to the Companys Current
    Report on
    Form 8-K
    filed on July 1, 2010 and incorporated herein by reference).10
.45*

Form of Restricted Stock Unit Award Agreement (filed as
    Exhibit 10.45 to the Companys
    Form 10-Q
    dated November 4, 2010 and incorporated herein by
    reference).10
.46

Amendment to Loan Agreement and Note dated September 1,
    2010 by and between U.S. Bank N.A. and Outdoor Channel Holdings,
    Inc. (filed as Exhibit 10.46 to the Companys
    Form 10-Q
    dated November 4, 2010 and incorporated herein by
    reference).21
.1

Subsidiaries of Registrant23
.1

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. 82




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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 10, 2011/s/  Roger
    L. Werner. Jr.Roger
    L. Werner. Jr.

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

March 10, 2011/s/  Thomas
    D. AllenThomas
    D. Allen

Chief Financial Officer (Principal Financial and Accounting
    Officer)

March 10, 2011/s/  Thomas
    H. MassieThomas
    H. Massie

Vice Chairman of the Board, Director

March 10, 2011/s/  Ajit
    M. DalviAjit
    M. Dalvi

Director

March 10, 2011/s/  David
    D. KinleyDavid
    D. Kinley

Director

March 10, 2011/s/  David
    C. MerrittDavid
    C. Merritt

Director

March 10, 2011/s/  Michael
    L. PandzikMichael
    L. Pandzik

Director

March 10, 2011/s/  T.
    Bahnson StanleyT.
    Bahnson Stanley

Director

March 10, 2011  83