SECURITIES AND EXCHANGE COMMISSION

FORM 10-K/A

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003

Commission File No. 000-24134

Integrity Media, Inc.

1000 Cody Road
Mobile, Alabama 36695

(Address of principal executive offices, zip code)

(251) 633-9000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to Section 12(g) of the Act:

Class A Common Stock, $0.01 Par Value
(Title of Class)

     Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

     Yes x No o

     Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference into Part III of this Form 10-K or any amendment to this form 10-K. x

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2).

     Yes o No x

     The aggregate market value of the Class A Common Stock held by non-affiliates of the registrant, based upon the closing price of the Class A Common Stock on the Nasdaq National Market on June 30, 2003, the last business day of the registrant’s most recently completed second fiscal quarter, was $11,511,361.14. Solely for the

purpose of the foregoing calculation, all executive officers and directors of the registrant have been deemed to be “affiliates” of the registrant.

     The number of shares of the registrant’s Class A Common Stock, $0.01 par value per share, outstanding at March 12, 2004 was 2,384,783.

     The number of shares of the registrant’s Class B Common Stock, $0.01 par value per share, outstanding at March 12, 2004 was 3,385,000.

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Table of Contents

EXPLANATORY NOTE

     On April 14, 2004, Integrity filed with the Securities and Exchange Commission its Annual Report on Form 10-K for the year ended December 31, 2003 (the “Initial 10-K”). Because Integrity has determined that it will not file its Proxy Statement prior to the April 29, 2004 deadline, Integrity is providing the information required by Part III (Items 10, 11, 12, 13 and 14) of Form 10-K by amendment in accordance with General Instruction G(3) of Form 10-K. This Annual Report on Form 10-K/A amends Items 10, 11, 12, 13 and 14 of Part III of the Initial 10-K in order to include those disclosures required by Part III of Form 10-K.

Special Cautionary Notice Regarding Forward-Looking Statements

     Certain of the matters discussed in this document and in documents incorporated by reference herein, including matters discussed under the caption “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of Integrity’s Annual Report on Form 10-K for the year ended December 31, 2003, may constitute forward-looking statements for purposes of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, and as such may involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Integrity Media, Inc. and Subsidiaries (the “Company” or “Integrity”) to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements. The words “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” and similar expressions are intended to identify such forward-looking statements. For any forward-looking statements contained, or incorporated by reference, herein, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company’s actual results may differ materially from the results anticipated in these forward-looking statements due to a variety of factors, including without limitation those discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Risk Factors” of Integrity’s Annual Report on Form 10-K for the year ended December 31, 2003. All written or oral forward-looking statements attributable to the Company are expressly qualified in their entirety by this cautionary notice. Any forward-looking statements represent management’s estimates only as of the date of this report and should not be relied upon as representing estimates as of any subsequent date. While Integrity may elect to update forward-looking statements at some point in the future, Integrity specifically disclaims any obligation to do so, even if its estimates change.

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PART III.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

Directors

     The following table sets forth the names of the directors of Integrity, their ages and first year elected director, their positions with Integrity and their principal occupations and employers for at least the last five years. For information concerning directors’ ownership of common stock, see “Beneficial Owners of More Than Five Percent of Integrity’s Common Stock; Shares Held by Directors and Executive Officers.”

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Executive Officers of Integrity

     Except for Mr. Coleman, who serves as Integrity’s Chairman, President and Chief Executive Officer and who is discussed above, the following table sets forth the names of the executive officers of Integrity, their ages, their positions with Integrity and their principal occupations and employers for at least the last five years. For information concerning executive officers’ ownership of common stock, see “Beneficial Owners of More Than Five Percent of Integrity’s Common Stock; Shares Held by Directors and Executive Officers.”

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Composition of Board of Directors

     Integrity’s Bylaws provide that its Board of Directors shall consist of not less than three, nor more than twelve, individuals, with the exact number of directors determined by a resolution of the Board of Directors. Pursuant to Integrity’s Bylaws, its Board of Directors has set the number of directors at six. Each director is serving a one-year term ending at the 2004 Annual Meeting of Stockholders and until his or her successor is duly elected and qualified or until his or her earlier resignation or removal.

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Committees of the Board of Directors

     Audit Committee. The Audit Committee is currently composed of three members who are independent within the meaning of the NASD listing standards and who are otherwise qualified to serve on the Audit Committee under those standards. The members of the Audit Committee are Jimmy M. Woodward (Chairman), Heeth Varnedoe III and William A. Jolly. Mr. Woodward is a “financial expert” within the definition of that term under the applicable SEC regulations.

     The Audit Committee oversees management’s conduct of the financial reporting process, the system of financial and administrative controls and the annual independent audit of Integrity’s financial statements. In addition, the Audit Committee makes recommendations to the Board of Directors regarding Integrity’s employment of independent auditors, reviews the independence of such auditors, approves the scope of the annual activities of the independent auditors and reviews audit results.

     Compensation Committee. The members of the Compensation Committee are Heeth Varnedoe III (Chairman), Jimmy M. Woodward and William A. Jolly. The function of the Compensation Committee is to review and approve the compensation of executive officers and establish targets and incentive awards under Integrity’s incentive compensation plans.

Code of Ethics

     As a Nasdaq listed company, we are required to develop a code of conduct that applies to all of our directors, officers and employees by May 4, 2004. We are currently developing an Integrity Standards of Conduct and Ethics that will be adopted prior to Nasdaq’s May 4, 2004 deadline, and when it is adopted we will make it publicly available on our website at www.integritymedia.com.

Section 16(a) Beneficial Ownership Reporting Compliance

     Section 16(a) of the Securities Exchange Act of 1934 requires Integrity’s officers and directors, and persons who own more than ten percent of a registered class of Integrity’s equity securities, to file reports of ownership and changes in ownership of such securities with the Securities and Exchange Commission and the National Association of Securities Dealers, Inc. Integrity’s officers, directors and greater than ten percent beneficial owners are required by applicable regulations to furnish Integrity with copies of all Section 16(a) forms that they file.

     Based solely upon a review of the copies of the forms furnished to Integrity, or written representations from certain reporting persons that no other reports were required, Integrity believes that during fiscal 2003 all of its officers and directors and greater than ten percent beneficial owners complied with all applicable filing requirements.

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ITEM 11. EXECUTIVE COMPENSATION.

     The following table presents certain summary information concerning compensation paid or accrued by Integrity for services rendered in all capacities during the fiscal years ended December 31, 2003, 2002 and 2001 for (i) the President and Chief Executive Officer of Integrity; and (ii) the four other most highly compensated executive officers of Integrity whose total salary and bonus exceeded $100,000 (determined as of December 31, 2003) (collectively, the “Named Executive Officers”).

Summary Compensation Table

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     The following table sets forth information concerning the value as of December 31, 2003 of options to purchase shares of Class A Common Stock held by the Named Executive Officers. Integrity does not issue options to purchase shares of Class B Common Stock.

Fiscal Year-End Option Values

Employment Arrangements

     Employment Agreements. Integrity has entered into an employment agreement (the “Weimer Employment Agreement”) with Mr. Weimer for the position of Executive Vice President and Chief Operating Officer. The Weimer Employment Agreement provides Mr. Weimer with an initial annual base salary of $175,000. Mr. Weimer’s base salary was $280,000 in fiscal year 2003. Mr. Weimer is also eligible to receive cash bonuses under the executive cash bonus compensation system established from time to time by Integrity. The term of the Weimer Employment Agreement began on March 28, 1996 and continues until it is terminated for death, disability, for cause or upon mutual written agreement. The Weimer Employment Agreement also may be terminated after Mr. Weimer has been employed by Integrity for at least eighteen (18) months, upon six (6) months’ prior written notice of termination from Integrity to Mr. Weimer; however, Integrity, at its sole discretion, may elect to pay Mr. Weimer an amount equal to his salary for six (6) months in lieu of providing the above-mentioned notice. The Weimer Employment Agreement contains non-competition, non-solicitation and confidentiality provisions and expressly incorporates the Change in Control Agreement agreed to and executed by Mr. Weimer and Integrity.

     Integrity has entered into an amended and restated employment agreement (the “McGuffey Employment Agreement”) with Mr. McGuffey for the position of Senior Vice President and Chief Marketing Officer. The McGuffey Employment Agreement currently provides Mr. McGuffey with an initial annual base salary of $175,000, which may be increased for merit or cost of living at Integrity’s discretion. Mr. McGuffey’s annual base salary was $194,656 in fiscal year 2003. Integrity also agreed to pay Mr. McGuffey an annual cash bonus of at least $10,000 plus additional cash bonuses for meeting certain performance goals as established from time to time by Integrity. In addition, Integrity has agreed to pay Mr. McGuffey a retention bonus in the total aggregate amount of $70,000, payable in three equal $10,000 installments on August 1, 2003, 2004 and 2005 and a $40,000 installment on August 1, 2006. The McGuffey Employment Agreement also provides for a one time payment of $50,000 as additional consideration for execution of a covenant not to compete. The term of the McGuffey Employment Agreement began on October 29, 2001 and continues until it is terminated for death, disability, for cause or upon mutual written agreement. The McGuffey Employment Agreement also may be terminated upon six (6) months’ prior written notice of termination from Integrity to Mr. McGuffey; however, Integrity, at its sole discretion, may elect to pay Mr. McGuffey an amount equal to his salary for six (6) months in lieu of providing such notice. If Mr. McGuffey is terminated upon six months’ notice, he will be entitled to receive as a severance benefit severance payments in an amount equal to his annual salary at the time of termination multiplied by two, less any amount Integrity paid to him in lieu of the six months’ notice. The McGuffey Employment Agreement contains non-competition, non-solicitation and confidentiality provisions and expressly incorporates the Change in Control Agreement agreed to and executed by Mr. McGuffey and Integrity.

     Integrity has also entered into an employment agreement (the “Williamson Employment Agreement”) with Mr. Williamson for the position of President and Chief Executive Officer of Integrity Publishers, Inc., the publishing subsidiary of Integrity. The Williamson Employment Agreement currently provides Mr. Williamson with an initial base annual salary of $250,000. Mr. Williamson’s annual base salary was $264,132 in fiscal year 2003. Mr. Williamson is also eligible to receive cash bonuses under the executive cash bonus compensation system established from time to time by Integrity. The term of the Williamson Employment Agreement began on June 1, 2001 and

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continues until it is terminated for death, disability, for cause or upon mutual written agreement. The Williamson Employment Agreement also may be terminated upon six (6) months’ prior written notice of termination from Integrity to Mr. Williamson; however, Integrity, at its sole discretion, may elect to pay Mr. Williamson an amount equal to his salary for six (6) months in lieu of providing such notice. If Mr. Williamson is terminated upon six months’ notice, he will be entitled to receive as a severance benefit severance payments in an amount equal to his annual salary at the time of termination multiplied by two, less any amount Integrity paid to him in lieu of the six months’ notice. The Williamson Employment Agreement contains non-competition, non-solicitation and confidentiality provisions and expressly incorporates the Change in Control Agreement agreed to and executed by Mr. Williamson and Integrity.

     In addition, in connection with the acquisition on June 28, 2002 of all of the interests of INO Records, LLC (formerly M2 Communications L.L.C.), an artist-based independent Christian music company headquartered in Nashville, Tennessee, Integrity entered into an employment agreement (the “Moseley Employment Agreement”) with Mr. Moseley for the position of President of INO Records, LLC. The Moseley Employment Agreement currently provides Mr. Moseley with a base annual salary of $200,000. Mr. Moseley received $203,500 in base salary in fiscal year 2003. In addition to being eligible to receive cash bonuses under the executive cash bonus compensation system established from time to time by Integrity, Mr. Moseley is also eligible to receive a cash retention bonus in the total aggregate amount of $2.5 million, payable in one installment of $250,000 on June 29, 2006 and three equal $750,000 installments on June 29, 2007, 2008 and 2009 (the “Retention Bonus”). The term of the Moseley Employment Agreement began on June 28, 2002, and continues for seven years or until it is terminated for death, disability, for cause, for good reason or upon mutual written agreement. The Moseley Employment Agreement also may be terminated upon six (6) months prior written notice of termination from Integrity to Mr. Moseley; however, Integrity, at its sole discretion, may elect to pay Mr. Moseley an amount equal to his salary for six (6) months in lieu of providing such notice. If Mr. Moseley is terminated by Integrity upon six months notice or Mr. Moseley terminates the Moseley Employment Agreement for good reason, he will be entitled to receive as a severance benefit severance payments in an amount equal to his annual salary at the time of termination for the remaining term of the Moseley Employment Agreement (or the remaining term of the covenant not to compete, whichever period is longer) plus any unpaid portion of the Retention Bonus. The Moseley Employment Agreement also contains non-competition, non-solicitation and confidentiality provisions.

     Change in Control Agreements. Integrity has entered into change in control agreements (the “Change in Control Agreements”) with certain Named Executive Officers as well as other senior officers of Integrity. The Change in Control Agreements provide that in the event the officer is employed by Integrity at the time of a Change in Control (as defined in the Change in Control Agreement), the officer shall be entitled to supplemental employment benefits should his employment with Integrity terminate within 18 months after the Change in Control has occurred. The Change in Control Agreements provide that such termination of employment can be involuntary, other than termination for cause or the result of death, disability, or retirement age, or voluntary, following a material change in the nature or location of his position or a material change in the benefits provided to the officer by Integrity. The supplemental benefits that are required to be provided to the officer upon such a termination include a severance payment in an amount equal to one-half of the officer’s annual base salary as well as various other benefits, including basic life insurance, long-term disability insurance, health insurance and other medical benefits.

     Without the consent of the officer, the terms of the Change in Control Agreement may be terminated or amended by Integrity following the first anniversary of its execution and at any time prior to the first to occur of (i) a Change in Control, (ii) the public announcement of a proposal for a transaction that, if consummated, will constitute a Change in Control, or (iii) the Board of Directors learning of a proposal for a transaction that, if consummated, would constitute a Change in Control. Upon the occurrence of any of the foregoing events, the Change in Control Agreements continue in effect at such time without termination or further change by Integrity until the earlier of (x) 18 months following any Change in Control, or (y) the final withdrawal or termination of a proposal under item (ii) or (iii) that, had it been consummated, would have constituted a Change in Control, at which time the Change in Control Agreement may, once again, be amended or terminated by Integrity until one of such events occurs.

     A Change in Control, as defined in the Change in Control Agreements, includes, among other things: a change of control of Integrity such that any person, other than current affiliates of Integrity, becomes the beneficial owner of securities of Integrity representing 50% or more of the combined voting power of Integrity’s then

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outstanding securities; any consolidation, merger or share exchange involving Integrity in which Integrity is not the continuing or surviving corporation or pursuant to which shares of Integrity stock would be converted into cash, securities or other property; the stockholders of Integrity approving any plan or proposal for the liquidation or dissolution of Integrity; or substantially all of the assets of Integrity being sold or otherwise transferred to parties that are not within a controlled group of corporations in which Integrity is a member.

     Severance Agreements. Integrity has entered into severance agreements (the “Severance Agreements”) with certain Named Executive Officers as well as other senior officers of Integrity. The Severance Agreements provide for the payment of severance benefits to such persons upon their termination of employment by Integrity without cause. Such persons are not entitled to severance benefits under the Severance Agreement if they voluntarily resign, quit, abandon their job or cannot perform their duties due to death or disability. In addition, if an officer is entitled to severance benefits upon termination of employment under the terms of a Change in Control Agreement, as described above, the officer will not be entitled to any benefits under the Severance Agreement.

     The Executive Nonqualified Excess Plan. Effective December 1, 2002, Integrity adopted the Executive Nonqualified Excess Plan of Integrity Media, Inc. (the “Excess Plan”), which provides a means for certain Named Executive Officers as well as other senior officers of Integrity to defer receipt of a portion of their current compensation until retirement. Under the Excess Plan, eligible participants may defer up to 20% of their annual base salary and 50% of their annual or long-term incentive bonus, with gains and losses debited and credited based on the performance of one or more investment funds chosen by the participant. Under the Excess Plan, Integrity has the right to decide annually whether matching credits will be made on behalf of the participants. Integrity did not make any matching credits in fiscal 2003.

     Long-Term Incentive Plan. On November 2, 2001, Integrity’s Board of Directors adopted the Integrity Incorporated 2001 Long-Term Incentive Plan (the “2001 LTIP”). The 2001 LTIP became effective as of its approval by the Board of Directors and was approved at Integrity’s Annual Meeting of Stockholders in May 2002. The 2001 LTIP permits grants of incentive stock options, non-qualified stock options, stock appreciation rights, performance shares, restricted stock and other stock based awards. Integrity has reserved for issuance upon the grant or exercise of awards pursuant to this plan 400,000 shares of authorized but unissued shares of Class A Common Stock. At December 31, 2003, there were 50,000 shares of Class A restricted stock outstanding under the 2001 LTIP. There are 350,000 shares available for grants under the 2001 LTIP.

Compensation of Directors

     Integrity pays an annual retainer of $12,000 (or $1,000 per month), plus $1,000 for each Board meeting attended and $500 for each Committee meeting attended by its directors who are not employees of Integrity, former employees of Integrity or members of the immediate family of a current or former employee of Integrity. Integrity also reimburses the directors for travel expenses incurred in connection with their activities on behalf of Integrity.

     Pursuant to the Integrity Incorporated 2002 Stock Option Plan for Outside Directors (the “Director Plan”), each director (other than employees, former employees or immediate family members of current or former employees) automatically receives, on the day of each annual meeting of stockholders, a grant of options to purchase 5,000 shares of Class A Common Stock. Such options have an exercise price equal to 100% of the fair market value of the Class A Common Stock at the date of grant of the option.

     In addition, in connection with their role on the special committee of independent directors with respect to the negotiation and execution of the Agreement and Plan of Merger dated March 1, 2004 by and among Integrity, Kona Acquisition Corp. and P. Michael Coleman, Jimmy M. Woodward (Chairman), Heeth Varnedoe III and William A. Jolly were each given a compensation package consisting of a $5,000 retainer plus $500 for each special committee meeting.

Compensation Committee Interlocks and Insider Participation

     The Compensation Committee is composed of Heeth Varnedoe III (Chairman), Jimmy M. Woodward and William A. Jolly. There are no “interlocks,” as defined by the SEC, with respect to any member of the Compensation Committee.

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ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     On December 31, 2003, there were 2,384,783 shares of Class A Common Stock issued and outstanding and 3,385,000 shares of Class B Common Stock issued and outstanding. The percentages shown in the following table are based on the total number of shares of Integrity’s Class A Common Stock and Class B Common Stock outstanding as of that date.

     Based solely upon information made available to Integrity and except where noted, the following table sets forth certain information with respect to the beneficial ownership of Class A Common Stock and Class B Common Stock as of December 31, 2003, by (i) each person who is known by Integrity to beneficially own more than five percent of either Class A Common Stock or Class B Common Stock; (ii) each director of Integrity; (iii) each of the Named Executive Officers (as defined under “Executive Compensation” below); and (iv) all officers and directors as a group.

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ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     Donald J. Moen, who serves as Integrity’s Executive Vice President and Creative Director, is also one of Integrity’s exclusive songwriters and artists. In this capacity, Mr. Moen received payments of approximately $355,000 in royalties during the fiscal year ended December 31, 2003.

     P. Michael Coleman owns 350 shares of common stock of, representing a 35% ownership interest in, Integrity’s UK subsidiary, Integrity Music Europe Limited, of which there are 1,000 shares of common stock outstanding. During the fiscal year ended December 31, 2003, Integrity Music Europe Limited made no distributions to Mr. Coleman.

     Integrity Worship Ministries, a not-for-profit charitable organization, received from Integrity cash contributions of $150,000 for the fiscal year ended December 31, 2003. P. Michael Coleman is a member of the board of directors of Integrity Worship Ministries. This contribution was initiated and approved by Integrity’s Board of Directors, with Mr. Coleman and Jean C. Coleman abstaining from the vote.

     Integrity’s Board of Directors has adopted a policy that requires that transactions between Integrity and its officers, directors or other affiliates be on terms no less favorable to Integrity than could be obtained from unaffiliated third parties on an arm’s-length basis and, further, that any such transaction be approved by a majority of Integrity’s directors who have no interest in such transaction.

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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

     PricewaterhouseCoopers LLP has audited our financial statements for fiscal 2003. The following table shows the aggregate fees billed to us by PricewaterhouseCoopers LLP for services rendered and the percentage of those services that were approved by the Audit Committee during the fiscal years ended December 31, 2002 and 2003.

     The nature of the services comprising Tax Fees were for certain tax compliance and consulting services. The nature of the services comprising the 2003 All Other Fees were for consultations relating to the proposed merger contemplated by the Agreement and Plan of Merger dated March 1, 2004 by and among Integrity, Kona Acquisition Corp. and P. Michael Coleman that would have the effect of taking Integrity private. The nature of the services comprising the 2002 All Other Fees were for due diligence in connection with the acquisition of Sarepta Music (Pty) Ltd on March 31, 2003.

     The Audit Committee pre-approved all audit related and tax services in fiscal 2003. The Audit Committee has delegated to the Chairman of the Audit Committee, the authority to pre-approve audit-related, tax and non-audit related services to be performed by the Company’s independent auditors.

     The Audit Committee has concluded that the provision of the non-audit services listed above is compatible with maintaining the independence of PricewaterhouseCoopers LLP.

PART IV

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

(a)3. Exhibits

INDEX TO EXHIBITS

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SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on April 28, 2004.

     Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities indicated on April 28, 2004.

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