SALEM MEDIA GROUP, INC. /DE/: Entering into a Material Definitive Agreement, Change of Directors or Principal Officers, Financial Statements and Exhibits (Form 8-K)

Section 1.01 Entering into a Material Definitive Agreement

At March 29, 2022, Salem Media Group, Inc. (the “Company”) has approved an amendment, effective January 2, 2022to the employment contract between Salem Communications Holding Company (“HoldCo”), a wholly owned subsidiary of the Company, and david santellathe Chairman and Chief Executive Officer of the Company (the “Santrella Amendment”).

The amended agreement provides for the following incentive compensation:

(i) Two (2) quarterly incentive bonuses in the amount of $6,800 for each quarter in which there is: (a) achievement of the Company’s total revenue budget (as determined by the Company’s management); and (b) achieving the Company’s total Adjusted EBITDA budget (as determined by the Company’s management).

(ii) Two (2) quarterly incentive bonuses in the amount of $3,400 for each quarter in which there is: (a) achievement of the revenue budget (as established by the Company’s management) by the Company’s audiovisual media enterprises; and (b) achievement of the Adjusted EBITDA budget (as determined by the Company’s management) by the Company’s audiovisual media businesses.

(iii) An annual award of twenty-five thousand dollars ($25,000) payable in restricted shares of Class A ordinary shares of the Company acquired twenty-four (24) months after the grant by the Company only if all of the following conditions occur: (a) the annual income of the Company exceeds the applicable annual revenue budget of the Company, as determined by the management of the Company, by at least $2,000,000; (b) the annual turnover of the Company exceeds the applicable turnover of the preceding year of the Company by at least 5%; (c) the annual EBITDA of the Company exceeds the applicable annual EBITDA budget of the Company, as established by the management of the Company, by at least $2,000,000; and (d) the annual EBITDA of the Company exceeds the applicable prior year EBITDA of the Company, as determined by the management of the Company, by at least 7.5%.

Moreover, on March 29, 2022the Company also approved an amendment, effective January 2, 2022to his employment contract between HoldCo and David Evansthe Company’s Chief Operating Officer (the “Evans Amendment”).

The amended agreement provides for the following incentive compensation:

(i) Two (2) quarterly incentive bonuses in the amount of $5,700 for each quarter in which there is: (a) achievement of the Company’s total revenue budget (as determined by the Company’s management); and (b) achieving the Company’s total Adjusted EBITDA budget (as determined by the Company’s management).

(ii) Two (2) quarterly incentive bonuses in the amount of $2,800 for each quarter in which there is: (a) achievement of the revenue budget (as determined by the Company’s management) by the Company’s non-broadcast media operations, excluding
Regnery Editions business unit; and (b) achievement of the Adjusted EBITDA budget (as determined by the Company’s management) by the Company’s non-broadcast media businesses, excluding Regnery Editions business unit.

(iii) Two (2) annual incentive bonuses in the amount of $6,800 each for the following: (a) achievement of the revenue budget (as established by the management of the Company) by the Regnery Editions business unit; and (b) the achievement of the EBITDA budget (as set by the management of the Company) by
Regnery Editions business unit.

(iv) An annual award of twenty-five thousand dollars ($25,000) payable in restricted shares of Class A ordinary shares of the Company acquired twenty-four (24) months after the grant by the Company only if all of the following conditions occur: (a) the annual income of the Company exceeds the applicable annual revenue budget of the Company, as determined by the management of the Company, by at least $2,000,000; (b) the Company

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the annual turnover of exceeds the applicable turnover of the previous year of the Company by at least 5%; (c) the annual EBITDA of the Company exceeds the applicable annual EBITDA budget of the Company, as established by the management of the Company, by at least $2,000,000; and (d) the annual EBITDA of the Company exceeds the applicable prior year EBITDA of the Company, as determined by the management of the Company, by at least 7.5%.

The information in this Item 1.01 regarding the Santrella Amendment and the Evans Amendment is qualified in its entirety by the copy of each such agreement attached to this current Report on Form 8-K as Exhibits 10.1 and 10.2, respectively. , and are incorporated herein. by reference.

Article 5.02 Departure of directors or certain officers; Election of directors;

Appointment of certain leaders; Compensatory schemes for certain

Officers.

See Section 1.01 for a description of the Santrella Amendment and the Evans Amendment. The information set out in Section 1.01 is incorporated by reference into this Section 5.02.

Item 9.01 Financial statements and supporting documents

(d) Exhibits. The following exhibit is provided with this report on Form 8-K:

Exhibit
  No.                                    Description

10.1          Amended and Restated Memorandum of Terms of Employment between Salem
            Communications Holding Corporation and David Santrella, effective as
            of January 2, 2022.

10.2          Amended and Restated Memorandum of Terms of Employment between Salem
            Communications Holding Corporation and David Evans, effective as of
            January 2, 2022.

104         Cover Page Interactive Data File (embedded within the inline XBRL
            document)



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