##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q/A
 (Amendment No. 1)
 (Mark One)
 þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
 For the quarterly period ended March 31, 2007
 o
    
    Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
 For the transition period from                    to
 Commission file number: 000-17287
 Outdoor Channel Holdings, Inc.
  Delaware
    
    33-0074499(State or other Jurisdiction
    
    (IRS Employer Identification Number)of incorporation or organization)
 43445 Business Park Drive, Suite 103
Temecula, California 92590
 (951) 699-6991
  þ o
  o þ o
 o þ
  Class
    
    Number of Shares Outstanding at April 30, 2007Common Stock, $0.001 par value
    
    
    25,832,613




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##### 



OUTDOOR CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
Quarterly Report on Form 10-Q/A
For The Period Ended March 31, 2007
 Table of Contents
  
 Part I. Financial InformationItem 1.
    
    Financial Statements
    
    
    4Condensed Consolidated Balance Sheets as of March 31, 2007 (Unaudited and As
Restated) and December 31, 2006 (As Restated)
    
    
    4Unaudited Condensed Consolidated Statements of Operations for the Three Months Ended
March 31, 2007 and 2006 (As Restated)
    
    
    5Unaudited Condensed Consolidated Statement of Stockholders Equity for the Three
Months Ended March 31, 2007 (As Restated)
    
    
    6Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months Ended
March 31, 2007 and 2006 (As Restated)
    
    
    7Notes to Unaudited Condensed Consolidated Financial Statements
    
    
    8Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    22Item 3.
    
    Quantitative and Qualitative Disclosures About Market Risk
    
    
    29Item 4.
    
    Controls and Procedures
    
    
    29Part II. Other InformationItem 1.
    
    Legal Proceedings
    
    
    31Item 1A.
    
    Risk Factors
    
    
    31Item 2.
    
    Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    41Item 3.
    
    Defaults Upon Senior Securities
    
    
    41Item 4.
    
    Submission of Matters to a Vote of Security Holders
    
    
    41Item 5.
    
    Other Information
    
    
    41Item 6.
    
    Exhibits
    
    
    41Signatures
    
    
    41EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2
   3




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PART IFINANCIAL INFORMATION
 
 ITEM 1. Financial Statements.
 
 OUTDOOR CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
 March 31,
    
    
    December 31,2007
    
    
    2006(Unaudited)
    
    
    (As Restated,(As Restated,
    
    
    Note 11)Note 11)AssetsCurrent assets:Cash and cash equivalents
    
    $
    32,498
    
    
    $
    15,447Investment in available-for-sale securities
    
    
    31,588
    
    
    
    42,144Accounts receivable, net of allowance for doubtful accounts of $218 and $208
    
    
    6,861
    
    
    
    6,845Income tax refund receivable
    
    
    222
    
    
    
    2,299Deferred tax assets, net
    
    
    624
    
    
    
    608Prepaid programming costs
    
    
    2,466
    
    
    
    2,713Other current assets
    
    
    951
    
    
    
    929Total current assets
    
    
    75,210
    
    
    
    70,985Property, plant and equipment at cost, net:Membership division
    
    
    3,352
    
    
    
    3,352Outdoor Channel
    
    
    12,285
    
    
    
    12,494Property, plant and equipment, net
    
    
    15,637
    
    
    
    15,846Amortizable intangible assets, net
    
    
    680
    
    
    
    820Goodwill
    
    
    43,124
    
    
    
    43,816Deferred tax assets, net
    
    
    11,716
    
    
    
    11,344Deposits and other assets
    
    
    2,170
    
    
    
    2,139Totals
    
    $
    148,537
    
    
    $
    144,950Liabilities and Stockholders EquityCurrent liabilities:Accounts payable and accrued expenses
    
    $
    3,543
    
    
    $
    2,901Accrued severance payments
    
    
    284
    
    
    
    341Current portion of deferred revenue
    
    
    780
    
    
    
    836Current portion of deferred obligations
    
    
    49
    
    
    
    42Customer deposits
    
    
    568
    
    
    
    155Total current liabilities
    
    
    5,224
    
    
    
    4,275Accrued severance payments, net of current portion
    
    
    41
    
    
    
    44Deferred revenue, net of current portion
    
    
    1,437
    
    
    
    1,361Deferred obligations
    
    
    308
    
    
    
    324Total liabilities
    
    
    7,010
    
    
    
    6,004Commitments 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: 25,843 and
25,507 shares issued and outstanding
    
    
    26
    
    
    
    26Additional paid-in capital
    
    
    169,264
    
    
    
    165,205Accumulated other comprehensive income
    
    
    47
    
    
    
    48Accumulated deficit
    
    
    (27,810
    )
    
    
    (26,333
    )Total stockholders equity
    
    
    141,527
    
    
    
    138,946Totals
    
    $
    148,537
    
    
    $
    144,950
  4




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OUTDOOR CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Operations
 Three Months EndedMarch 31,2007
    
    
    2006(As Restated,
    
    
    (As Restated,Note 11)
    
    
    Note 11)Revenues:Advertising
    
    $
    6,386
    
    
    $
    5,690Subscriber fees
    
    
    4,749
    
    
    
    4,383Membership income
    
    
    1,129
    
    
    
    1,226Total revenues
    
    
    12,264
    
    
    
    11,299Cost of services:Programming
    
    
    1,474
    
    
    
    1,544Satellite transmission fees
    
    
    596
    
    
    
    638Production and operations
    
    
    1,370
    
    
    
    1,169Other direct costs
    
    
    208
    
    
    
    157Total costs of services
    
    
    3,648
    
    
    
    3,508Other expenses:Advertising
    
    
    736
    
    
    
    2,213Selling, general and administrative
    
    
    9,044
    
    
    
    5,599Depreciation and amortization
    
    
    711
    
    
    
    679Total other expenses
    
    
    10,491
    
    
    
    8,491Loss from operations
    
    
    (1,875
    )
    
    
    (700
    )Interest expense
    
    
    
    
    
    
    78Other income
    
    
    703
    
    
    
    623Loss before income taxes
    
    
    (1,172
    )
    
    
    (155
    )Income tax provision (benefit)
    
    
    (445
    )
    
    
    (3
    )Net loss
    
    $
    (727
    )
    
    $
    (152
    )Loss per common share  basic and diluted
    
    $
    (0.03
    )
    
    $
    (0.01
    )Weighted average number of common shares outstanding  basic and diluted
    
    
    25,603
    
    
    
    24,445
  5




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OUTDOOR CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statement of Stockholders Equity
For the Three Months Ended March 31, 2007
 Additional
    
    
    Accumulated OtherCommon Stock
    
    
    Paid-in
    
    
    Comprehensive
    
    
    AccumulatedShares
    
    
    Amount
    
    
    Capital
    
    
    Income (Loss)
    
    
    Deficit
    
    
    TotalBalance, December 31, 2006 (as
restated, Note 11)
    
    
    25,507
    
    
    $
    26
    
    
    $
    165,205
    
    
    $
    48
    
    
    $
    (26,333
    )
    
    $
    138,946Comprehensive loss:Net loss (as restated, Note 11)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (727
    )
    
    
    (727
    )Effect of change in fair value
of available-for-sale
securities, net of deferred
taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (1
    )Total comprehensive loss (as
restated, Note 11)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (728
    )Common stock issued upon exercise
of stock options
    
    
    332
    
    
    
    
    
    
    
    446
    
    
    
    
    
    
    
    
    
    
    
    446Issuance of restricted stock to
employees and service providers
for services to be rendered, net
of forfeited shares
    
    
    20
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Share-based employee and service
provider compensation expense
    
    
    
    
    
    
    
    
    
    
    3,780
    
    
    
    
    
    
    
    
    
    
    
    3,780Purchase and retirement of
treasury stock related to
employee and service provider
share-based compensation activity
    
    
    (16
    )
    
    
    
    
    
    
    (167
    )
    
    
    
    
    
    
    
    
    
    
    (167
    )Cumulative effect of adoption of
new accounting pronouncement
(Note 8)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (750
    )
    
    
    (750
    )Balance, March 31, 2007
    
    
    25,843
    
    
    $
    26
    
    
    $
    169,264
    
    
    $
    47
    
    
    $
    (27,810
    )
    
    $
    141,527
  6




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OUTDOOR CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Cash Flows
 Three Months EndedMarch 31,2007
    
    
    2006(As Restated,
    
    
    (As Restated,Note 11)
    
    
    Note 11)Operating activities:Net loss
    
    $
    (727
    )
    
    $
    (152
    )Adjustments to reconcile net loss to net cash provided by operating activities:Depreciation and amortization
    
    
    826
    
    
    
    680Provision for doubtful accounts
    
    
    60
    
    
    
    67Share-based employee and service provider compensation
    
    
    3,780
    
    
    
    831Deferred tax provision (benefit)
    
    
    (446
    )
    
    
    (3
    )Tax benefits from exercise of stock options in excess of recognized expense
    
    
    
    
    
    
    (34
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (76
    )
    
    
    (1,570
    )Income tax refund receivable
    
    
    2,077
    
    
    
    Prepaid programming costs
    
    
    247
    
    
    
    (194
    )Other current assets
    
    
    (22
    )
    
    
    (388
    )Deposits and other assets
    
    
    (146
    )
    
    
    (69
    )Accounts payable and accrued expenses
    
    
    498
    
    
    
    422Deferred revenue
    
    
    20
    
    
    
    659Customer deposits
    
    
    413
    
    
    
    482Accrued severance payments
    
    
    (60
    )
    
    
    (4
    )Deferred obligations
    
    
    (9
    )
    
    
    17Net cash provided by operating activities
    
    
    6,435
    
    
    
    744Investing activities:Purchases of property, plant and equipment
    
    
    (217
    )
    
    
    (973
    )Purchases of available-for-sale securities
    
    
    (16,726
    )
    
    
    (32,638
    )Proceeds from sale of available-for-sale securities
    
    
    27,280
    
    
    
    34,150Net cash provided by investing activities
    
    
    10,337
    
    
    
    539Financing activities:Principal payments on long-term debt and capital leases
    
    
    
    
    
    
    (182
    )Proceeds from exercise of stock options
    
    
    446
    
    
    
    183Purchase of treasury stock
    
    
    (167
    )
    
    
    Tax benefits from exercise of stock options in excess of recognized expense
    
    
    
    
    
    
    34Net cash provided by financing activities
    
    
    279
    
    
    
    35Net increase in cash and cash equivalents
    
    
    17,051
    
    
    
    1,318Cash and cash equivalents, beginning of period
    
    
    15,447
    
    
    
    18,276Cash and cash equivalents, end of period
    
    $
    32,498
    
    
    $
    19,594Supplemental disclosure of cash flow information:Interest paid
    
    $
    
    
    
    $
    78Income taxes paid
    
    $
    1
    
    
    $
    Supplemental disclosures of non-cash investing and financing activities:Effect of net increase (decrease) in fair value of available-for-sale
securities, net of deferred taxes
    
    $
    (1
    )
    
    $
    12Property, plant and equipment costs incurred but not paid
    
    $
    96
    
    
    $
    216Retirement of treasury stock
    
    $
    167
    
    
    $
    Effect of net increase in fair value of cash flow hedge
    
    $
    
    
    
    $
    79
  7




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OUTDOOR CHANNEL HOLDINGS, INC. AND SUBSIDIARIES
Notes to Unaudited Condensed Consolidated Financial Statements
 NOTE 1ORGANIZATION AND BUSINESS
 Description of Operations
   Recent Accounting Pronouncements
   Restatement of 2007 Financial Statements
  NOTE 2UNAUDITED INTERIM FINANCIAL STATEMENTS
  8




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NOTE 3STOCK INCENTIVE PLANS
   Three Months EndedMarch 31,2007
    
    
    2006Nature of Award:Restricted stock
    
    $
    235
    
    
    $
    97Options
    
    
    695
    
    
    
    734Performance units
    
    
    2,850
    
    
    
    Total share-based compensation expense
    
    $
    3,780
    
    
    $
    831
 Three Months EndedMarch 31,2007
    
    
    2006Classification of Compensation Expense:Cost of services:Production and operations
    
    $
    (9
    )
    
    $
    36Other expenses:Selling, general and administrative
    
    
    3,789
    
    
    
    795Total share-based compensation expense
    
    $
    3,780
    
    
    $
    831
 9




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Three Months EndedMarch 31,2007
    
    2006Risk-free interest rate
    
    
    4.9  5.0%
    
    
    
    4.3  4.6%Dividend yield
    
    
    0%
    
    
    
    0%Expected life of the option
    
    0.8 years
    
    3.8 yearsVolatility factor
    
    
    39.2  39.5%
    
    
    
    55.8  58.9%Weighted average volatility factor
    
    
    39.4%
    
    
    
    58.4%
  NOTE 4LOSS PER COMMON SHARE
   NOTE 5EQUITY TRANSACTIONS
 Issuances of Common Stock by the Company
  Three Months EndedMarch 31,2007
    
    2006Number of options exercised
    
    
    332
    
    
    
    174Cash proceeds
    
    $
    446
    
    
    $
    183Tax benefit from options exercised
    
    $
    692
    
    
    $
    672
 10




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Stock Options
  Weighted
    
    
    AggregateWeighted
    
    
    Average
    
    
    IntrinsicShares
    
    
    Average
    
    
    Remaining
    
    
    Value(in
    
    
    Exercise
    
    
    Contractual
    
    
    (inOptions
    
    thousands)
    
    
    Price
    
    
    Term
    
    
    thousands)Outstanding at beginning of period
    
    
    3,272
    
    
    $
    9.48Granted
    
    
    
    
    
    
    Exercised
    
    
    (332
    )
    
    
    1.34Forfeited or expired
    
    
    (20
    )
    
    
    13.77Outstanding at end of period
    
    
    2,920
    
    
    $
    10.38
    
    
    
    2.50
    
    
    $
    5,827Vested or expected to vest at end of period
    
    
    2,866
    
    
    $
    10.32
    
    
    
    2.47
    
    
    $
    5,826Exercisable at end of period
    
    
    1,953
    
    
    $
    8.97
    
    
    
    2.07
    
    
    $
    5,770
   Restricted Stock
  WeightedShares
    
    
    Average(in
    
    
    Grant-Datethousands)
    
    
    Fair ValueNonvested at beginning of period
    
    
    314
    
    
    $
    12.73Granted
    
    
    34
    
    
    
    12.83Vested
    
    
    (13
    )
    
    
    12.05Forfeited
    
    
    (14
    )
    
    
    13.63Nonvested at end of period
    
    
    321
    
    
    $
    12.73
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Expense to be Recognized
  March 31, 2007Weighted AverageExpense
    
    
    RemainingYet to be
    
    
    Requisite ServiceRecognized
    
    
    PeriodsStock options
    
    $
    4,328
    
    
    2.55 yearsRestricted stock
    
    
    2,963
    
    
    2.43 yearsPerformance units
    
    
    3,733
    
    
    0.40 yearsTotal
    
    $
    11,024
    
    
    1.79 years
 NOTE 6RELATED PARTY TRANSACTIONS
  NOTE 7INVESTMENT IN AVAILABLE-FOR-SALE SECURITIES
   As of
    
    
    As ofMarch 31, 2007
    
    
    December 31, 2006Auction rate securities
    
    $
    30,695
    
    
    $
    41,250Equities
    
    
    893
    
    
    
    894Total available-for-sale securities
    
    $
    31,588
    
    
    $
    42,144
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Three Months EndedMarch 31,2007
    
    
    2006Interest income
    
    $
    684
    
    
    $
    608Dividend income
    
    
    19
    
    
    
    15Total other income
    
    $
    703
    
    
    $
    623
 NOTE 8INCOME TAX PROVISION (BENEFIT)
   NOTE 9SEGMENT INFORMATION
   13




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Additions toLoss
    
    
    
    
    
    
    Depreciation
    
    
    Property,Before Income
    
    
    Total
    
    
    and
    
    
    Plant andRevenues
    
    
    Taxes
    
    
    Assets
    
    
    Amortization
    
    
    ImprovementsAs of and for the Three Months
Ended:
March 31, 2007 (as restated,
Note 11)TOC
    
    $
    10,995
    
    
    $
    (315
    )
    
    $
    79,158
    
    
    $
    765
    
    
    $
    301Membership Division
    
    
    1,269
    
    
    
    73
    
    
    
    5,600
    
    
    
    61
    
    
    
    61Subtotals of Segments
    
    
    12,264
    
    
    
    (242
    )
    
    
    84,758
    
    
    
    826
    
    
    
    362Corporate*
    
    
    
    
    
    
    (930
    )
    
    
    64,529
    
    
    
    
    
    
    
    Totals
    
    $
    12,264
    
    
    $
    (1,172
    )
    
    $
    149,287
    
    
    $
    826
    
    
    $
    362March 31, 2006 (as restated, Note 11)TOC
    
    $
    9,920
    
    
    $
    533
    
    
    $
    81,036
    
    
    $
    609
    
    
    $
    1,177Membership Division
    
    
    1,379
    
    
    
    189
    
    
    
    5,854
    
    
    
    71
    
    
    
    12Subtotals of Segments
    
    
    11,299
    
    
    
    722
    
    
    
    86,890
    
    
    
    680
    
    
    
    1,189Corporate*
    
    
    
    
    
    
    (877
    )
    
    
    67,467
    
    
    
    
    
    
    
    Totals
    
    $
    11,299
    
    
    $
    (155
    )
    
    $
    154,357
    
    
    $
    680
    
    
    $
    1,189
 
 *
    
    We capture corporate overhead that is applicable to both segments, but not directly related to
operations in a separate business unit, as Corporate. The expenses allocated to Corporate
consisted primarily of: professional fees including public relations, accounting and legal fees,
taxes associated with being incorporated in Delaware, board fees, and other corporate fees not
associated directly with either TOC or the Membership Division. Corporate assets consist primarily
of cash not held in our operating accounts, available-for-sale securities, deferred tax assets, net
and income tax refund receivable. NOTE 10SUBSEQUENT EVENTS
   As of March 31, 2007Total current assets
    
    $
    2,609Total fixed assets
    
    
    3,352Total other assets
    
    
    28Total assets
    
    
    5,989Total current liabilities
    
    
    963Total long-term liabilities
    
    
    1,437Total liabilities
    
    
    2,400Net carrying value
    
    $
    3,589
 NOTE 11RESTATEMENTS OF UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
  14




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As OriginallyReported
    
    As Restated
    
    ChangeAccounts receivable, net
    
    $
    6,523
    
    
    $
    6,861
    
    
    $
    338Current deferred tax assets, net
    
    
    606
    
    
    
    624
    
    
    
    18Other current assets
    
    
    1,012
    
    
    
    951
    
    
    
    (61
    )Total current assets
    
    
    74,915
    
    
    
    75,210
    
    
    
    295Property, plant and equipment, net
    
    
    15,525
    
    
    
    15,637
    
    
    
    112Goodwill
    
    
    44,457
    
    
    
    43,124
    
    
    
    (1,333
    )Deferred tax assets, net
    
    
    13,615
    
    
    
    11,716
    
    
    
    (1,899
    )Deposits and other assets
    
    
    2,171
    
    
    
    2,170
    
    
    
    (1
    )Total assets
    
    
    151,363
    
    
    
    148,537
    
    
    
    (2,826
    )Accounts payable and accrued expenses
    
    
    3,604
    
    
    
    3,543
    
    
    
    (61
    )Current portion of deferred revenue
    
    
    249
    
    
    
    780
    
    
    
    531Current portion of deferred obligations
    
    
    
    
    
    
    49
    
    
    
    49Total current liabilities
    
    
    4,705
    
    
    
    5,224
    
    
    
    519Deferred revenue, net of current portion
    
    
    1,968
    
    
    
    1,437
    
    
    
    (531
    )Deferred obligations
    
    
    333
    
    
    
    308
    
    
    
    (25
    )Total liabilities
    
    
    7,047
    
    
    
    7,010
    
    
    
    (37
    )Additional paid-in capital
    
    
    166,994
    
    
    
    169,264
    
    
    
    2,270Accumulated deficit
    
    
    (22,751
    )
    
    
    (27,810
    )
    
    
    (5,059
    )Total stockholders equity
    
    
    144,316
    
    
    
    141,527
    
    
    
    (2,789
    )Total liabilities and stockholders equity
    
    $
    151,363
    
    
    $
    148,537
    
    
    $
    (2,826
    )
 15




---



##### Table of Contents



As OriginallyReported
    
    As Restated
    
    ChangeCurrent deferred tax assets, net
    
    $
    592
    
    
    $
    608
    
    
    $
    16Total current assets
    
    
    70,969
    
    
    
    70,985
    
    
    
    16Property, plant and equipment, net
    
    
    15,797
    
    
    
    15,846
    
    
    
    49Goodwill
    
    
    44,457
    
    
    
    43,816
    
    
    
    (641
    )Deferred tax assets, net
    
    
    13,775
    
    
    
    11,344
    
    
    
    (2,431
    )Total assets
    
    
    147,957
    
    
    
    144,950
    
    
    
    (3,007
    )Accounts payable and accrued expenses
    
    
    2,902
    
    
    
    2,901
    
    
    
    (1
    )Current portion of deferred revenue
    
    
    225
    
    
    
    836
    
    
    
    611Current portion of deferred obligations
    
    
    
    
    
    
    42
    
    
    
    42Total current liabilities
    
    
    3,623
    
    
    
    4,275
    
    
    
    652Deferred revenue, net of current portion
    
    
    1,972
    
    
    
    1,361
    
    
    
    (611
    )Deferred obligations
    
    
    344
    
    
    
    324
    
    
    
    (20
    )Total liabilities
    
    
    5,983
    
    
    
    6,004
    
    
    
    21Additional paid-in capital
    
    
    164,589
    
    
    
    165,205
    
    
    
    616Accumulated deficit
    
    
    (22,689
    )
    
    
    (26,333
    )
    
    
    (3,644
    )Total stockholders equity
    
    
    141,974
    
    
    
    138,946
    
    
    
    (3,028
    )Total liabilities and stockholders equity
    
    $
    147,957
    
    
    $
    144,950
    
    
    $
    (3,007
    )
   As OriginallyReported
    
    As Restated
    
    ChangeFor the three months ended March 31, 2007Advertising revenue
    
    $
    6,048
    
    
    $
    6,386
    
    
    $
    338Total revenues
    
    
    11,926
    
    
    
    12,264
    
    
    
    338Production and operations
    
    
    1,473
    
    
    
    1,370
    
    
    
    (103
    )Total costs of services
    
    
    3,751
    
    
    
    3,648
    
    
    
    (103
    )Selling, general and administrative
    
    
    7,467
    
    
    
    9,044
    
    
    
    1,577Depreciation and amortization
    
    
    773
    
    
    
    711
    
    
    
    (62
    )Total other expenses
    
    
    8,976
    
    
    
    10,491
    
    
    
    1,515Loss from operations
    
    
    (801
    )
    
    
    (1,875
    )
    
    
    (1,074
    )Loss before income taxes
    
    
    (98
    )
    
    
    (1,172
    )
    
    
    (1,074
    )Income tax provision (benefit)
    
    
    (36
    )
    
    
    (445
    )
    
    
    (409
    )Net loss
    
    
    (62
    )
    
    
    (727
    )
    
    
    (665
    )Loss per common share:Basic earnings per common share
    
    $
    0.00
    
    
    $
    (0.03
    )
    
    $
    (0.03
    )Diluted earnings per common share
    
    $
    0.00
    
    
    $
    (0.03
    )
    
    $
    (0.03
    )Weighted average number of common shares 
basic and diluted
    
    
    25,273
    
    
    
    25,603
    
    
    
    330
 16




---



##### Table of Contents



As OriginallyReported
    
    As Restated
    
    ChangeFor the three months ended March 31, 2006Advertising revenue
    
    $
    5,685
    
    
    $
    5,690
    
    
    $
    5Membership income
    
    
    1,221
    
    
    
    1,226
    
    
    
    5Total revenues
    
    
    11,289
    
    
    
    11,299
    
    
    
    10Production and operations
    
    
    1,205
    
    
    
    1,169
    
    
    
    (36
    )Other direct costs
    
    
    208
    
    
    
    157
    
    
    
    (51
    )Total costs of services
    
    
    3,595
    
    
    
    3,508
    
    
    
    (87
    )Advertising expense
    
    
    2,162
    
    
    
    2,213
    
    
    
    51Selling, general and administrative
    
    
    5,544
    
    
    
    5,599
    
    
    
    55Depreciation and amortization
    
    
    673
    
    
    
    679
    
    
    
    6Total other expenses
    
    
    8,379
    
    
    
    8,491
    
    
    
    112Loss from operations
    
    
    (685
    )
    
    
    (700
    )
    
    
    (15
    )Loss before income taxes
    
    
    (140
    )
    
    
    (155
    )
    
    
    (15
    )Income tax provision (benefit)
    
    
    17
    
    
    
    (3
    )
    
    
    (20
    )Net loss
    
    
    (157
    )
    
    
    (152
    )
    
    
    5Loss per common share:Basic earnings per common share
    
    $
    (0.01
    )
    
    $
    (0.01
    )
    
    $
    Diluted earnings per common share
    
    $
    (0.01
    )
    
    $
    (0.01
    )
    
    $
    Weighted average number of common shares 
basic and diluted
    
    
    24,462
    
    
    
    24,445
    
    
    
    (17
    )
   As OriginallyReported
    
    As Restated
    
    ChangeBalance, December 31, 2006Additional paid-in capital
    
    $
    164,589
    
    
    $
    165,205
    
    
    $
    616Accumulated deficit
    
    
    (22,689
    )
    
    
    (26,333
    )
    
    
    (3,644
    )Total stockholders equity
    
    
    141,974
    
    
    
    138,946
    
    
    
    (3,028
    )Net loss
    
    
    (62
    )
    
    
    (727
    )
    
    
    (665
    )Total comprehensive loss
    
    
    (63
    )
    
    
    (728
    )
    
    
    (665
    )Share-based employee and
service provider compensation
expense
    
    
    2,309
    
    
    
    3,780
    
    
    
    1,471Change in estimate of tax
benefit from exercise of
stock options
    
    
    (183
    )
    
    
    
    
    
    
    183Cumulative effect of adoption
of new accounting
pronouncement
    
    
    
    
    
    
    (750
    )
    
    
    (750
    )Balance at March 31, 2007Additional paid-in capital
    
    
    166,994
    
    
    
    169,264
    
    
    
    2,270Accumulated deficit
    
    
    (22,751
    )
    
    
    (27,810
    )
    
    
    (5,059
    )Total stockholders equity
    
    $
    144,316
    
    
    $
    141,527
    
    
    $
    (2,789
    )
 17




---



##### Table of Contents



As OriginallyReported
    
    As Restated
    
    ChangeFor the three months ended March 31, 2007Net loss
    
    $
    (62
    )
    
    $
    (727
    )
    
    $
    (665
    )Depreciation and amortization
    
    
    889
    
    
    
    826
    
    
    
    (63
    )Share-based employee and service provider
compensation
    
    
    2,309
    
    
    
    3,780
    
    
    
    1,471Deferred tax provision (benefit), net
    
    
    (36
    )
    
    
    (446
    )
    
    
    (410
    )Change in:Accounts receivable
    
    
    262
    
    
    
    (76
    )
    
    
    (338
    )Other current assets
    
    
    (83
    )
    
    
    (22
    )
    
    
    61Deposits and other assets
    
    
    (147
    )
    
    
    (146
    )
    
    
    1Accounts payable and accrued expenses
    
    
    702
    
    
    
    498
    
    
    
    (204
    )Deferred rent obligations
    
    
    (11
    )
    
    
    (9
    )
    
    
    2Net cash provided by operating activities
    
    
    6,580
    
    
    
    6,435
    
    
    
    (145
    )Purchases of property, plant and equipment
    
    
    (362
    )
    
    
    (217
    )
    
    
    145Net cash provided by financing activities
    
    
    10,192
    
    
    
    10,337
    
    
    
    145Change in estimate of tax benefit from
exercise of stock options
    
    
    183
    
    
    
    
    
    
    
    (183
    )Property, plant and equipment costs incurred
but not paid
    
    $
    
    
    
    $
    96
    
    
    $
    96
  As OriginallyReported
    
    As Restated
    
    ChangeFor the three months ended March 31, 2006Net loss
    
    $
    (157
    )
    
    $
    (152
    )
    
    $
    5Depreciation and amortization
    
    
    676
    
    
    
    680
    
    
    
    4Share-based employee and service provider
compensation
    
    
    815
    
    
    
    831
    
    
    
    16Deferred tax provision (benefit), net
    
    
    17
    
    
    
    (3
    )
    
    
    (20
    )Change in:Accounts receivable
    
    
    (1,560
    )
    
    
    (1,570
    )
    
    
    (10
    )Accounts payable and accrued expenses
    
    
    638
    
    
    
    422
    
    
    
    (216
    )Deferred rent obligations
    
    
    12
    
    
    
    17
    
    
    
    5Net cash provided by operating activities
    
    
    343
    
    
    
    744
    
    
    
    401Purchases of property, plant and equipment
    
    
    (1,189
    )
    
    
    (973
    )
    
    
    216Net cash provided by investing activities
    
    
    323
    
    
    
    539
    
    
    
    216Net cash provided by financing activities
    
    
    279
    
    
    
    35
    
    
    
    (244
    )Property, plant and equipment costs incurred
but not paid
    
    $
    
    
    
    $
    216
    
    
    $
    216
 18




---



##### Table of Contents



As OriginallyReported
    
    
    As Restated
    
    
    ChangeFor the three months ended March 31, 2007Restricted stock
    
    $
    153
    
    
    $
    235
    
    
    $
    82Options
    
    
    503
    
    
    
    695
    
    
    
    192Performance units
    
    
    1,653
    
    
    
    2,850
    
    
    
    1,197Total share-based compensation expense
    
    $
    2,309
    
    
    $
    3,780
    
    
    $
    1,471
 As OriginallyReported
    
    
    As Restated
    
    
    ChangeFor the three months ended March 31, 2007Cost of services:Production and operations
    
    $
    
    
    
    $
    (8
    )
    
    $
    (8
    )Other expenses:Selling, general and administrative
    
    
    2,309
    
    
    
    3,788
    
    
    
    1,479Total share-based compensation expense
    
    $
    2,309
    
    
    $
    3,780
    
    
    $
    1,471
  As OriginallyReported
    
    
    As Restated
    
    
    ChangeFor the three months ended March 31, 2006Restricted stock
    
    $
    101
    
    
    $
    97
    
    
    $
    (4
    )Options
    
    
    713
    
    
    
    734
    
    
    
    21Performance units
    
    
    
    
    
    
    
    
    
    
    Total share-based compensation expense
    
    $
    814
    
    
    $
    831
    
    
    $
    17
 As OriginallyReported
    
    
    As Restated
    
    
    ChangeFor the three months ended March 31, 2006Cost of services:Production and operations
    
    $
    
    
    
    $
    36
    
    
    $
    36Other expenses:Selling, general and administrative
    
    
    814
    
    
    
    795
    
    
    
    (19
    )Total share-based compensation expense
    
    $
    814
    
    
    $
    831
    
    
    $
    17
   As OriginallyReported
    
    
    As Restated
    
    
    ChangeStock options
    
    $
    3,220
    
    
    $
    4,328
    
    
    $
    1,108Restricted stock
    
    
    3,246
    
    
    
    2,963
    
    
    
    (283
    )Performance units
    
    
    4,959
    
    
    
    3,733
    
    
    
    (1,226
    )Total
    
    $
    11,425
    
    
    $
    11,024
    
    
    $
    (401
    )
 19




---



##### Table of Contents



As OriginallyReported
    
    As Restated
    
    ChangeStock options
    
    
    1.4
    
    
    
    2.6
    
    
    
    1.2Restricted stock
    
    
    1.8
    
    
    
    2.4
    
    
    
    0.6Performance units
    
    
    0.8
    
    
    
    0.4
    
    
    
    (0.4
    )Total
    
    
    1.2
    
    
    
    1.8
    
    
    
    0.6
     Additions toLoss
    
    
    
    
    
    
    Depreciation
    
    
    Property,Before Income
    
    
    Total
    
    
    and
    
    
    Plant andRevenues
    
    
    Taxes
    
    
    Assets
    
    
    Amortization
    
    
    ImprovementsAs of and for the Three
Months Ended: March 31,
2007As originally reportedTOC
    
    $
    10,657
    
    
    $
    679
    
    
    $
    78,769
    
    
    $
    828
    
    
    $
    301Membership Division
    
    
    1,269
    
    
    
    73
    
    
    
    5,600
    
    
    
    61
    
    
    
    61Subtotals of Segments
    
    
    11,926
    
    
    
    752
    
    
    
    84,369
    
    
    
    889
    
    
    
    362Corporate*
    
    
    
    
    
    
    (850
    )
    
    
    66,994
    
    
    
    
    
    
    
    Totals
    
    $
    11,926
    
    
    $
    (98
    )
    
    $
    151,363
    
    
    $
    889
    
    
    $
    362As restatedTOC
    
    $
    10,995
    
    
    $
    (315
    )
    
    $
    79,158
    
    
    $
    765
    
    
    $
    301Membership Division
    
    
    1,269
    
    
    
    73
    
    
    
    5,600
    
    
    
    61
    
    
    
    61Subtotals of Segments
    
    
    12,264
    
    
    
    (242
    )
    
    
    84,758
    
    
    
    826
    
    
    
    362Corporate*
    
    
    
    
    
    
    (930
    )
    
    
    64,529
    
    
    
    
    
    
    
    Totals
    
    $
    12,264
    
    
    $
    (1,172
    )
    
    $
    149,287
    
    
    $
    826
    
    
    $
    362
  Additions toLoss
    
    
    
    
    
    
    Depreciation
    
    
    Property,Before Income
    
    
    Total
    
    
    and
    
    
    Plant andRevenues
    
    
    Taxes
    
    
    Assets
    
    
    Amortization
    
    
    ImprovementsChanges as of and for the
Three Months Ended: March
31, 2007TOC
    
    $
    338
    
    
    $
    (994
    )
    
    $
    389
    
    
    $
    (63
    )
    
    $
    Membership Division
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Subtotals of Segments
    
    
    338
    
    
    
    (994
    )
    
    
    389
    
    
    
    (63
    )
    
    
    Corporate*
    
    
    
    
    
    
    (80
    )
    
    
    (2,465
    )
    
    
    
    
    
    
    Totals
    
    $
    338
    
    
    $
    (1,074
    )
    
    $
    (2,076
    )
    
    $
    (63
    )
    
    $
    
 20




---



##### Table of Contents



Additions toLoss
    
    
    
    
    
    
    Depreciation
    
    
    Property,Before Income
    
    
    Total
    
    
    and
    
    
    Plant andRevenues
    
    
    Taxes
    
    
    Assets
    
    
    Amortization
    
    
    ImprovementsAs of and for the Three
Months Ended:March 31,
2006As originally reportedTOC
    
    $
    9,910
    
    
    $
    554
    
    
    $
    80,956
    
    
    $
    605
    
    
    $
    1,177Membership Division
    
    
    1,379
    
    
    
    189
    
    
    
    5,854
    
    
    
    71
    
    
    
    12Subtotals of Segments
    
    
    11,289
    
    
    
    743
    
    
    
    86,810
    
    
    
    676
    
    
    
    1,189Corporate*
    
    
    
    
    
    
    (883
    )
    
    
    68,128
    
    
    
    
    
    
    
    Totals
    
    $
    11,289
    
    
    $
    (140
    )
    
    $
    154,938
    
    
    $
    676
    
    
    $
    1,189As restatedTOC
    
    $
    9,920
    
    
    $
    533
    
    
    $
    81,036
    
    
    $
    609
    
    
    $
    1,177Membership Division
    
    
    1,379
    
    
    
    189
    
    
    
    5,854
    
    
    
    71
    
    
    
    12Subtotals of Segments
    
    
    11,299
    
    
    
    722
    
    
    
    86,890
    
    
    
    680
    
    
    
    1,189Corporate*
    
    
    
    
    
    
    (877
    )
    
    
    67,467
    
    
    
    
    
    
    
    Totals
    
    $
    11,299
    
    
    $
    (155
    )
    
    $
    154,357
    
    
    $
    680
    
    
    $
    1,189
  Additions toLoss
    
    
    
    
    
    
    Depreciation
    
    
    Property,Before Income
    
    
    Total
    
    
    and
    
    
    Plant andRevenues
    
    
    Taxes
    
    
    Assets
    
    
    Amortization
    
    
    ImprovementsChanges as of and for the
Three Months Ended:March
31, 2006TOC
    
    $
    10
    
    
    $
    (21
    )
    
    $
    80
    
    
    $
    4
    
    
    $
    Membership Division
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Subtotals of Segments
    
    
    10
    
    
    
    (21
    )
    
    
    80
    
    
    
    4
    
    
    
    Corporate*
    
    
    
    
    
    
    6
    
    
    
    (661
    )
    
    
    
    
    
    
    Totals
    
    $
    10
    
    
    $
    (15
    )
    
    $
    (581
    )
    
    $
    4
    
    
    $
    
  21




---



##### Table of Contents



ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS.
 Safe Harbor Statement
   Effects of Restatement
  22




---



##### Table of Contents



General
  Gold
 23




---



##### Table of Contents



Prospector & Treasure Hunters in the Great Outdoors
  Recent Accounting Pronouncements
   Comparison of Operating Results for the Three Months Ended March 31, 2007 and March 31, 2006
  Change
    
    
    % of Total Revenue2007
    
    
    2006
    
    
    $
    
    
    %
     
    
    2007
    
    
    2006(As Restated, Note 11)
    
    
    (As Restated, Note 11)
    
    
    (As Restated, Note 11)Revenues:Advertising
    
    $
    6,386
    
    
    $
    5,690
    
    
    $
    696
    
    
    
    12.2
    %
    
    
    52.1
    %
    
    
    50.4
    %Subscriber fees
    
    
    4,749
    
    
    
    4,383
    
    
    
    366
    
    
    
    8.4
    
    
    
    38.7
    
    
    
    38.8Membership income
    
    
    1,129
    
    
    
    1,226
    
    
    
    (97
    )
    
    
    (7.9
    )
    
    
    9.2
    
    
    
    10.8Total revenues
    
    
    12,264
    
    
    
    11,299
    
    
    
    965
    
    
    
    8.5
    
    
    
    100.0
    
    
    
    100.0Cost of services:Programming
    
    
    1,474
    
    
    
    1,544
    
    
    
    (70
    )
    
    
    (4.5
    )
    
    
    12.0
    
    
    
    13.7Satellite transmission fees
    
    
    596
    
    
    
    638
    
    
    
    (42
    )
    
    
    (6.6
    )
    
    
    4.9
    
    
    
    5.6Production and operations
    
    
    1,370
    
    
    
    1,169
    
    
    
    201
    
    
    
    17.2
    
    
    
    11.1
    
    
    
    10.3Other direct costs
    
    
    208
    
    
    
    157
    
    
    
    51
    
    
    
    32.5
    
    
    
    1.7
    
    
    
    1.4Total cost of services
    
    
    3,648
    
    
    
    3,508
    
    
    
    140
    
    
    
    4.0
    
    
    
    29.7
    
    
    
    31.0Other expenses:Advertising
    
    
    736
    
    
    
    2,213
    
    
    
    (1,477
    )
    
    
    (66.7
    )
    
    
    6.0
    
    
    
    19.5Selling, general and
administrative
    
    
    9,044
    
    
    
    5,599
    
    
    
    3,445
    
    
    
    61.5
    
    
    
    73.8
    
    
    
    49.6Depreciation and amortization
    
    
    711
    
    
    
    679
    
    
    
    32
    
    
    
    4.7
    
    
    
    5.8
    
    
    
    6.0Total other expenses
    
    
    10,491
    
    
    
    8,491
    
    
    
    2,000
    
    
    
    23.6
    
    
    
    85.6
    
    
    
    75.1Loss from operations
    
    
    (1,875
    )
    
    
    (700
    )
    
    
    (1,175
    )
    
    
    167.9
    
    
    
    (15.3
    )
    
    
    (6.1
    )Interest expense
    
    
    
    
    
    
    78
    
    
    
    (78
    )
    
    
    (100.0
    )
    
    
    
    
    
    
    0.7Other income
    
    
    703
    
    
    
    623
    
    
    
    80
    
    
    
    12.8
    
    
    
    5.7
    
    
    
    5.5Loss before income taxes
    
    
    (1,172
    )
    
    
    (155
    )
    
    
    (1,017
    )
    
    
    656.1
    
    
    
    (9.6
    )
    
    
    (1.3
    )Income tax provision (benefit)
    
    
    (445
    )
    
    
    (3
    )
    
    
    (442
    )
    
    
    (14,733.3
    )
    
    
    (3.7
    )
    
    
    Net loss
    
    $
    (727
    )
    
    $
    (152
    )
    
    $
    (575
    )
    
    
    378.3
    %
    
    
    (5.9
    )%
    
    
    (1.3
    )%
 Revenues
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Gold Prospectors & Treasure Hunters in the Great Outdoors
 Results of Operations
       Cost of Services
  25




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Other Expenses
     26




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Loss from Operations
  Interest Expense
  Other Income
  Loss Before Income Taxes
    27




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Income Tax Provision (Benefit)
  Net Loss
  Liquidity and Capital Resources
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
    
 ITEM 4. CONTROLS AND PROCEDURES.
 Evaluation of disclosure controls and procedures.
  Managements report on internal control over financial reporting.
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Remediation plan for material weakness in internal control over financial reporting.
   Changes in internal control over financial reporting.
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PART IIOTHER INFORMATION
 
 ITEM 1. Legal Proceedings.
  
 ITEM 1A. Risk Factors.
  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.
  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.
  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.
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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.
  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.
  If our channels are 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.
  Consolidation among cable and satellite operators may harm our business.
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We may not be able to effectively manage our future growth, and our growth may not continue, which
may substantially harm our business and prospects.
  We may not be able to secure additional national advertising accounts, and as a result, our
revenues and profitability may be negatively impacted.
  We have found a material weakness in our internal controls over financial reporting and 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.
    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.
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Our operating results may be negatively impacted if our Outdoor Channel 2 HD network is not as
successful as we anticipate.
  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;
 
    
    specific economic conditions in the cable television and related industries; and
 
    
    changing regulatory requirements.
  Changes to financial accounting standards or our accounting estimates may affect our reported
operating results.
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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.
   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.
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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, on
acceptable terms to fund our future growth and operations.
  We may not be able to attract and retain key personnel.
  New video recording technologies may reduce our advertising revenue.
 ®
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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.
  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.
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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 66 2/3% 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 66 2/3% 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.
  The cable and satellite television industry is subject to substantial governmental regulation for
which compliance may increase our costs and expose us to penalties for failure to comply.
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We must comply with many local, states, federal and environmental regulations, for which compliance
may be costly and may expose us to substantial penalties.
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If our goodwill becomes impaired, we will be required to take a non-cash 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.
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ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds.
  
 ITEM 3. Defaults Upon Senior Securities.
  
 ITEM 4. Submission of Matters to a Vote of Security Holders.
  
 ITEM 5. Other Information.
  
 ITEM 6. Exhibits.
 ExhibitNumber
    
    Description3.1
    
    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 and
Exhibit 4.1 to the Companys Form 10-Q for the period ended
June 30, 2005)10.1
    
    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)10.2
    
    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)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
 
 *
    
    Pursuant to Commission Release No. 33-8238, this certification will be treated as
accompanying this Quarterly Report on Form 10-Q 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. 
 SIGNATURES
  OUTDOOR CHANNEL HOLDINGS, INC./s/ Shad L. BurkeShad L. BurkeAuthorized Officer, Interim Chief Financial Officer, Chief Accounting Officer
and Principal Accounting OfficerDate: February 1, 2008 41