Exhibit 10.16


 


OPTION AGREEMENT


 


THIS OPTION AGREEMENT (this “Agreement”)
is made and entered into as of August 31, 2007, by and among Barrington Traverse City LLC, a Delaware limited liability
company (together with its successors and permitted assigns, “Option Holder”), Tucker Broadcasting of Traverse City, Inc., a Delaware
corporation (together with its successors and permitted assigns, the “Company”), and Tucker Media
and Management Consulting L.L.C., a Delaware limited liability
company (together with its successors and permitted assigns, “Grantor”).


 


WITNESSETH


 


WHEREAS, Option Holder is a
party to that certain Asset Purchase Agreement (the “Station
Purchase Agreement”), dated as of the date hereof, by and among
Max Media of Traverse City LLC, MTC License LLC (collectively, “Sellers”) and Option Holder,
pursuant to which Option Holder has agreed to purchase certain assets of the
Sellers related to the television broadcast stations WGTU, channel 29, Traverse
City, Michigan (“WGTU”) and WGTQ, channel 8, Sault
Ste. Marie, Michigan (“WGTQ” and
together with WGTU, the “Stations”)
each serving the Traverse City/Cadillac, Michigan market;


 


WHEREAS, Grantor owns 100% of
the issued and outstanding common stock, par value $0.01 per share (the “Common Stock”), of the Company;


 


WHEREAS, Option Holder and the
Company are parties to that certain Assignment and Assumption Agreement (the “Assignment Agreement”), dated as of
the date hereof, pursuant to which Option Holder has assigned certain of its
rights under the Station Purchase Agreement to the Company, including the right
to purchase the Purchased Assets (as such term is defined in the Station
Purchase Agreement);


 


WHEREAS, effective upon the
closing of the transactions contemplated by the Station Purchase Agreement (the
“Station Closing”), Grantor and the
Company desire to grant Option Holder an option to purchase, at Option Holder’s
election, (i) all of the Common Stock of the Company or (ii) all of the Company’s
assets relating to the Stations, including the Purchased Assets, in either case
on the terms and conditions set forth herein; and


 


WHEREAS, Option Holder desires
to acquire from Grantor and the Company an option to purchase, at Option Holder’s
election, (i) all of the Common Stock of the Company or (ii) all of the Company’s
assets relating to the Stations, including the Purchased Assets, in either case
on the terms and conditions set forth herein.


 


NOW, THEREFORE, in consideration
of the mutual covenants and agreements hereinafter set forth, the parties, intending
to be legally bound, agree as follows:


 


1.             Option Grant.
Grantor hereby gives, grants, transfers and conveys to Option Holder, and its
successors and assigns, the sole and exclusive right, privilege and option to
purchase (the “Option”), on the terms and
conditions hereinafter set forth and effective as of the Station Closing, at
Option Holder’s election, (i) all of the Common Stock of the Company now held
or hereinafter acquired by Grantor (collectively, the “Subject
Shares”), or (ii) all of the tangible and intangible personal
property, licenses, authorizations and leases, contracts and 


 

















 


agreements, owned or held by Grantor or the Company or in which Grantor
or the Company holds an interest, relating to the operation of the Stations,
including the property described below (and collectively referred to as the “Assets”):


 


(a)           All
of the Purchased Assets;


 


(b)           All
of the licenses, construction permits and other authorizations issued by the
FCC for the operation of the Stations, including any renewals, extensions or
modifications thereof and additions thereto between the date hereof and the
Option Closing (collectively, the “FCC Licenses”);


 


(c)           All
other licenses, permits, construction permits, approvals, concessions,
franchises, certificates, consents, qualifications, registrations, privileges
and other authorizations and other rights, from any governmental authority to
Grantor or the Company used in connection with the Stations, including any
renewals, extensions or modifications thereof and additions thereto between the
Station Closing and the Option Closing (collectively, the “Permits”);


 


(d)           All
of the tangible personal property owned by Grantor or the Company as of the
Station Closing or thereafter acquired by Grantor or the Company and used or useful
in the operation of the Stations;


 


(e)           All
of the intangible personal property owned by Grantor or the Company relating to
or used in connection with the operation of the Stations as of the Station
Closing or thereafter acquired by Grantor or the Company and used or useful in
the operation of the Stations, exclusive of all cash on-hand of Grantor or the
Company and any payments due to the Company under the JSA;


 


(f)            Grantor’s
and the Company’s rights and duties under the Station Purchase Agreement; and


 


(g)           All
of the contracts, leases and other agreements relating to the ownership and
operation of the Stations.


 


2.             Consideration for
Option. This Option is granted for the Option Period (as the same may
be extended pursuant to Section 3 hereof) in return for, among other
consideration, the payment by Option Holder to Grantor of an amount equal to
Five Thousand Five Hundred Dollars ($5,500.00), which shall be due and payable
on the date of the Station Closing.


 


3.             Option Period.
The Option shall be effective commencing on the date hereof (the “Effective Date”) and ending on the
eighth anniversary of the Effective Date (the “Option
Period”); provided, however, that the Option Period shall be extended
automatically without any further action by Option Holder, Grantor or the
Company if the Joint Sales Agreement (as the same may be amended from time to
time, the “JSA”), dated as of the date
hereof, by and between Option Holder and the Company, shall be renewed and,
thereafter, the Option Period shall continue until the JSA is terminated in
accordance with its terms. The Option may be exercised by Option Holder at any
time during the Option Period.


 


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4.             Exercise of Option;
Withdrawal.


 


(a)           Option
Holder may exercise the Option at any time during the Option Period by delivery
of written notice thereof (the “Exercise Notice”)
to Grantor, specifying whether Option Holder is exercising the Option with
respect to the Subject Shares or the Assets. Upon exercise of the Option,
Option Holder, Grantor and the Company shall be obligated to enter into the
transactions to be consummated hereunder at the Option Closing, subject to the
provisions of Sections 9 and 10 hereof, and Section 4(b) below.


 


(b)           Option
Holder may withdraw any Exercise Notice prior to the Option Closing by written
notice to Grantor of such withdrawal. No such withdrawal (and no withdrawal of
any subsequent Exercise Notice) will affect Option Holder’s right subsequently
to exercise the Option by delivering to Grantor during the Option Period one or
more other Exercise Notices.


 


5.             Purchase of Subject
Shares or Assets.


 


(a)           Purchase Price. At the Option Closing, and pursuant to the
terms and subject to the conditions set forth in this Agreement, Option Holder
shall pay to Grantor an amount equal to the Cash Purchase Price by federal wire
transfer of same-day funds pursuant to wire instructions delivered to Option
Holder by Grantor at least two business days prior to the Closing Date (or such
other method of funds transfer as may be agreed upon by Option Holder and
Grantor). The “Cash Purchase Price” shall be
(i) in the event Option Holder exercises the Option with respect to the Assets,
an amount equal to the sum of (x) the Base Value (as defined in Schedule 5(a) hereto) and (y) the Escalation Amount (as
defined and calculated pursuant to Schedule 5(a)
hereto), or (ii) in the event Option Holder exercises the Option with respect
to the Subject Shares, an amount equal to (A) the sum of (x) the Base Value and
(y) the Escalation Amount less (B) Outstanding Debt (as defined in Schedule 5(a) hereto).


 


(b)           Purchase of Subject Shares. Subject to Section 4(b), upon
the exercise of the Option with respect to the Subject Shares, Grantor shall,
on the Closing Date, deliver any and all stock certificates representing the
Subject Shares, duly endorsed for transfer to Option Holder, together with
appropriate stock powers duly endorsed for transfer to Option Holder.


 


(c)           Purchase of Assets.


 


(i)            Transfer of
Assets. Subject to Section 4(b), upon the exercise of the Option
with respect to the Assets, Grantor and the Company shall, on the Closing Date,
sell, assign, transfer, convey and deliver to Option Holder all right, title
and interest of Grantor and the Company in and to the Assets free and clear of
liens, claims and encumbrances (“Liens”),
except for Assumed Obligations, liens for taxes not yet due and payable and any
other liens expressly identified and agreed to by the parties in writing
(collectively, “Permitted Liens”).


 


(ii)           Excluded
Assets. Except for those assets specifically identified in Section
1, the Assets shall not include any other assets, properties, interests or
rights of any kind or description (the “Excluded Assets”).
The Excluded Assets shall remain the property of Grantor or the Company, as the
case may be.


 


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(iii)          Assumption
of Obligations. On the Closing Date, Option Holder shall assume and
undertake to pay, discharge and perform all obligations of Grantor or the
Company, as the case may be, as the holder of the Permits and the FCC Licenses,
including all obligations to make all required FCC filings with respect
thereto, and as the owner of the other Assets, including all leases and
contracts included in such Assets, to the extent such obligations arise out of
events occurring on or after the Closing Date (the “Assumed
Obligations”).


 


(iv)          Excluded
Obligations. Option Holder does not assume or agree to discharge or
perform, and will not be deemed by reason of the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby, to have
assumed or to have agreed to discharge or perform, and Grantor and the Company
shall remain liable for, any liabilities, obligations or commitments of Grantor
and the Company arising from the business or operation of the Stations before
the Closing Date and any other obligations or liabilities other than the
Assumed Obligations.


 


(v)           Allocation.
Option Holder, Grantor and the Company will allocate the Cash Purchase Price in
accordance with the respective fair market values of the Assets and the
goodwill being purchased and sold in accordance with the requirements of
Section 1060 of the Internal Revenue Code of 1986, as amended. The allocation shall
be determined by mutual agreement of the parties. Option Holder, Grantor and
the Company agree to file their federal income tax returns and their other tax
returns reflecting such allocation and to use such allocation for accounting
and financial reporting purposes.


 


(d)           Closing. Upon the exercise of the Option, the consummation
of the sale and purchase of the Subject Shares or the Assets, as the case may
be, provided for in this Agreement (the “Option Closing”)
shall take place no later than ten business days after the satisfaction or, to
the extent permissible by law, the waiver (by the party for whose benefit the
closing condition is imposed) of, the conditions specified in Sections 9
and 10 hereof. Alternatively, the Option Closing may take place at such other
place, time or date as the parties may mutually agree upon in writing. The date
on which the Option Closing is to occur is referred to herein as the “Closing Date.”


 


6.             Representations and
Warranties of Grantor and the Company. Grantor and the Company, jointly
and severally, represent and warrant to Option Holder as follows; provided, however, that
neither Grantor nor the Company make any representation or warranty as to any
action, event, occurrence or circumstance that (i)
was or shall be caused by Option Holder or that arose, or shall arise from any
omission by Option Holder to perform its obligations under the JSA or the
Shared Services Agreement (the “SSA”),
dated as of the date hereof, by and between the Company and Option Holder, or (ii) constitutes a breach by Sellers of a representation or
warranty of Sellers under the Station Purchase Agreement:


 


(a)           The
Company was organized as a Delaware corporation on August 21, 2007. Prior to
the date hereof, the Company has not engaged in any business and does not have
any liabilities or obligations, except those liabilities and obligations
incurred in connection with 


 


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its organization, the
negotiation, execution, delivery and performance of this Agreement, the Station
Purchase Agreement, the Assignment Agreement, the Letter Agreement (as
hereinafter defined), the JSA and the SSA and the transactions contemplated
hereby and thereby and incidental expenses incurred in connection therewith. The
Company has no indebtedness for borrowed money, other than indebtedness incurred
in connection with the performance of the Company’s obligations pursuant to the
Station Purchase Agreement pursuant to a credit agreement or other financing
arrangement contemplated by that certain Commitment Letter, dated as of August
31, 2007, from Banc of America Securities LLC, Wachovia Bank, National
Association, Wachovia Capital Markets, LLC and CIT Lending Services Corporation
in favor of Tucker Broadcasting of Traverse City, Inc., or any other financing
arrangement provided by, or entered into with, Pilot Group L.P. or an Affiliate
thereof (an “Acquisition Financing Arrangement”).


 


(b)           Each
of Grantor and the Company has the power and authority and full legal capacity
to enter into and to perform its obligations under this Agreement. The
execution, delivery and performance of this Agreement by each of Grantor and
the Company has been duly authorized and this Agreement constitutes a valid and
binding obligation of each of Grantor and the Company enforceable against each
of them in accordance with it terms, except as may be limited by bankruptcy,
insolvency or other similar laws affecting the enforcement of creditors’ rights
in general and subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).


 


(c)           As
of the Option Closing, Grantor owns 100% of the Subject Shares and Grantor has
good and valid title to the Subject Shares free and clear of all liens. All of
the Subject Shares have been duly authorized and are validly issued, fully paid
and nonassessable. Other than the Subject Shares or pursuant to an Acquisition
Financing Transaction, no class of interests in or equity interests of the
Company is outstanding, and there are no outstanding subscriptions, warrants,
options, calls, commitments or other rights to purchase or acquire, or
securities convertible into or exchangeable for, any equity or debt interests
of the Company or any obligation of the Company to issue or grant any thereof.


 


(d)           As
of the Option Closing, the Company has good and marketable title to the Assets
free and clear of all liens other than liens for taxes not yet due and payable
and liens that will be discharged at or prior to the Option Closing.


 


(e)           As
of the Closing Date, the Company is the holder of the FCC Licenses and such FCC
Licenses are valid and in full force and effect.


 


(f)            As
of the Closing Date, Grantor and the Company shall have filed all material
returns, reports, and statements that Grantor or the Company, as the case may
be, is required to file with the FCC and the Federal Aviation Administration. Except
as set forth on Schedule 6(f) hereto, (i) there is no action, suit or proceeding pending or, to
Grantor’s knowledge, threatened in writing against Grantor or the Company in
respect of the Stations seeking to enjoin the transactions contemplated by this
Agreement; and (ii) to Grantor’s knowledge, there
are no governmental claims or investigations pending or threatened against
Grantor or the Company in respect of the Stations (except those affecting the
broadcasting industry generally).


 


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(g)           No
broker, finder or other person is entitled to a commission, brokerage fee or
other similar payment in connection with this Agreement or the transactions
contemplated hereby as a result of any agreement or action of Grantor or the
Company or any other party acting on Grantor’s or the Company’s behalf.


 


The parties agree
that Schedule 6(f) hereto may be updated by
Grantor as of the Closing Date.


 


7.             Representations and
Warranties of Option Holder. Option Holder represents and warrants to
Grantor and the Company as follows:


 


(a)           Option
Holder is a limited liability company duly formed, validly existing and in good
standing under the laws of the State of Delaware.


 


(b)           Option
Holder has the power and authority to enter into and perform its obligations
under this Agreement.


 


(c)           The
execution, delivery and performance of this Agreement by Option Holder has been
duly authorized and this Agreement constitutes a valid and binding obligation
of Option Holder enforceable against it in accordance with its terms, except as
may be limited by bankruptcy, insolvency or other similar laws affecting creditors’
rights in general and subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).


 


(d)           No
broker, finder or other person is entitled to a commission, brokerage fee or
other similar payment in connection with this Agreement or the transactions
contemplated hereby as a result of any agreement or action of Option Holder or
any party acting on Option Holder’s behalf.


 


8.             Covenants of Grantor
and the Company  During the
Option Period, and subject to the JSA and SSA, and the performance by Option
Holder of its obligations thereunder, Grantor and the Company, jointly and
severally, covenant to:


 


(a)           Maintain
insurance on the Assets and with respect to the operation of the Stations in such
amounts and in such nature as in effect on the date hereof;


 


(b)           Operate
the Stations in all material respects in accordance with the terms of the FCC
Licenses, the Communications Act of 1934, as amended (the “Communications
Act”), the rules and published policies of the FCC (“FCC Rules”) and all other statutes,
ordinances, rules and regulations of governmental authorities;


 


(c)           Refrain
from taking any action that would cause the FCC Licenses not to be in full
force and effect or to be revoked, suspended, cancelled, rescinded, terminated
or expired;


 


(d)           File
all material returns, reports, and statements that Grantor or the Company, as
the case may be, is required to file with the FCC and the Federal Aviation
Administration;


 


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(e)           Other
than pursuant to an Acquisition Financing Arrangement, not mortgage, pledge,
subject to any lien or otherwise encumber (or cause any of the foregoing to
occur) any of the Assets or Subject Shares or any other outstanding equity
interests or assets of Grantor or the Company;


 


(f)            Not
sell, lease or otherwise dispose of any of the Assets in a manner that is
inconsistent with this Agreement, except for properties and assets sold or
replaced with others of like kind and value in the ordinary course of business;
and


 


(g)           Not
issue any subscription, warrant, option, calls, commitments or other rights to
purchase or acquire any equity or debt interests, or any securities convertible
into or exchangeable for any equity or debt interests, of Grantor or the
Company (other than pursuant to an Acquisition Financing Arrangement).


 


Notwithstanding anything to the contrary contained herein, to the
extent that the obligations of Grantor or the Company hereunder would require
the incurrence of an Other Expense as defined in the JSA, such obligation or
covenant shall be subject to the terms and conditions of the JSA.


 


9.             Grantor and the
Company Closing Conditions.


 


Subject to the exercise of the Option pursuant to the
terms and subject to the conditions of this Agreement, the obligations of
Grantor and the Company hereunder are subject to satisfaction or waiver, at or
prior to the Option Closing, of each of the following conditions:


 


(a)           Representations, Warranties and Covenants. The representations
and warranties of Option Holder made in this Agreement shall be true and
correct in all material respects at and as of the Closing Date except for
changes permitted or contemplated by the terms of this Agreement, and the
covenants and agreements to be complied with and performed by Option Holder at
or prior to the Option Closing shall have been complied with or performed in
all material respects. Grantor shall have received a certificate dated as of
the Closing Date from Option Holder, executed by an authorized officer of
Option Holder, to the effect that the conditions set forth in this Section 9(a)
have been satisfied.


 


(b)           FCC Consent. The FCC Consent shall have been obtained and be
in effect and no court or governmental order prohibiting the Option Closing
shall be in effect.


 


(c)           No Prohibitions. No injunction, restraining order or decree
of any nature of any governmental authority of competent jurisdiction shall be
in effect that restrains or prohibits any party from consummating the
transactions contemplated by this Agreement.


 


10.          Option Holder Closing
Conditions.


 


Subject to the exercise of the Option pursuant the
terms and subject to the conditions of this Agreement, the obligations of
Option Holder hereunder are subject to satisfaction or waiver, at or prior to
the Option Closing, of each of the following conditions:


 


(a)           Representations, Warranties and Covenants. The
representations and warranties of Grantor and the Company made in this
Agreement shall be true and correct in all 


 


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material respects at and
as of the Closing Date except for changes permitted or contemplated by the
terms of this Agreement, and the covenants and agreements to be complied with
and performed by Grantor and the Company at or prior to the Option Closing
shall have been complied with or performed in all material respects. Option
Holder shall have received certificates dated as of the Closing Date from each
of the Company and Grantor, executed by an authorized officer of each of the
Company and Grantor to the effect that the conditions set forth in this Section
10(a) have been satisfied.


 


(b)           FCC Consent. The FCC Consent shall have been obtained and
constitute a Final Order, and no court or governmental order prohibiting the Option
Closing shall be in effect. For purposes hereof, “Final
Order” shall mean an action by the FCC or other regulatory
authority having jurisdiction (i) with respect
to which action no timely request for stay, motion or petition for
reconsideration or rehearing, application or request for review or notice of
appeal or other judicial petition for review is pending and (ii) as to which the time for filing any such request,
motion, petition, application, appeal or notice and for entry of orders
staying, reconsidering or reviewing on the FCC’s or such other regulatory
authority’s own motion has expired.


 


(c)           No Prohibitions. No injunction, restraining order or decree
of any nature of any governmental authority of competent jurisdiction shall be
in effect that restrains or prohibits any party from consummating the
transactions contemplated by this Agreement.


 


11.          Closing Deliveries.


 


(a)           Purchase of Subject Shares.


 


(i)            Grantor
Documents. Subject to the exercise of the Option with respect to the
Subject Shares pursuant to the terms and subject to the conditions of this
Agreement, at the Option Closing Grantor shall deliver or cause to be delivered
to Option Holder:


 


(A)          certified copies of
resolutions authorizing the execution, delivery and performance of this Agreement,
including the consummation of the transactions contemplated hereby, by Grantor;


 


(B)           the certificates
described in Section 10(a) hereof;


 


(C)           all stock certificates
representing the Subject Shares, duly endorsed for transfer to Option Holder
accompanied by appropriate stock powers duly endorsed for transfer to Option
Holder;


 


(D)          a certificate from the
Secretary of State of the State of Delaware as to the Company’s good standing
and payment of all taxes in such jurisdiction dated within three days of the
Closing Date; and


 


(E)           such other documents,
certificates, payments, assignments, transfers and other deliveries as Option
Holder may reasonably request 


 


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and as are customary to
effect a closing of the matters herein contemplated.


 


(ii)           Option
Holder Documents. Subject to the exercise of the Option with respect
to the Subject Shares pursuant to the terms and subject to the conditions of
this Agreement, at the Option Closing Option Holder shall deliver or cause to
be delivered to Grantor:


 


(A)          the certificate
described in Section 9(a) hereof;


 


(B)           the Cash Purchase
Price; and


 


(C)           such other documents,
certificates, payments, assignments, transfers and other deliveries as Grantor
may reasonably request and as are customary to effect a closing of the matters
herein contemplated.


 


(b)           Purchase of Assets.


 


(i)            Grantor
Documents. Subject to the exercise of the Option with respect to the
Assets pursuant to the terms and subject to the conditions of this Agreement,
at the Option Closing Grantor and the Company shall deliver or cause to be
delivered to Option Holder:


 


(A)          certified copies of
resolutions authorizing the execution, delivery and performance of this
Agreement, including the consummation of the transactions contemplated hereby,
by Grantor and the Company;


 


(B)           the certificates
described in Section 10(a) hereof


 


(C)           the Assignment and
Assumption Agreement in the form attached hereto as Exhibit A;


 


(D)          the Assignment and
Assumption Agreement FCC Licenses in the form attached hereto as Exhibit B; and


 


(E)           such other bills of
sale, assignments and other instruments of conveyance, assignment and transfer
as may be necessary to convey, transfer and assign to Option Holder the Assets,
free and clear of Liens, except for Permitted Liens.


 


(ii)           Option
Holder Documents. Subject to the exercise of the Option with respect
to the Assets pursuant to the terms and subject to the conditions of this
Agreement, at the Option Closing Option Holder shall deliver or cause to be
delivered to Grantor and the Company:


 


(A)          the certificate
described in Section 9(a) hereof;


 


(B)           the Cash Purchase
Price;


 


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(C)           the Assignment and
Assumption Agreement in the form attached hereto as Exhibit A;


 


(D)          the Assignment and
Assumption Agreement FCC Licenses in the form attached hereto as Exhibit B; and


 


(E)           such other documents
and instruments of assumption as may be necessary to assume the Assumed
Obligations.


 


12.          Survival; Indemnification.


 


(a)           Survival. The representations and warranties in this
Agreement shall survive the Option Closing for twelve months after the Closing
Date, whereupon they shall expire and be of no further force or effect, except
those under this Section 12 that relate to Damages for which written notice is
given by the Indemnified Party to the Indemnifying Party prior to the
expiration, which shall survive until resolved.


 


(b)           Indemnification.


 


(i)            Subject to the
limitations set forth in Section 12(c) below, from and after the Option
Closing, Grantor shall defend, indemnify and hold harmless Option Holder from
and against any and all losses, costs, damages, claims, suits, actions,
judgments, liabilities and expenses, including reasonable attorneys’ fees and
expenses (“Damages”), incurred by Option
Holder arising out of or resulting from (A) any material
inaccuracy in, or breach or nonfulfillment of, any of the representations,
warranties, covenants or agreements made by Grantor or the Company in this
Agreement or default by Grantor or the Company under this Agreement, or (B) in the case of the sale of the Assets, obligations or
liabilities of Grantor or the Company regarding the Stations other than the
Assumed Obligations.


 


(ii)           From and after the
Option Closing, Option Holder shall defend, indemnify and hold harmless Grantor
from and against any and all Damages incurred by Grantor arising out of or
resulting from (A) any material inaccuracy in, or
breach or nonfulfillment of, any of the representations, warranties, covenants
or agreements made by Option Holder in this Agreement or default by Option
Holder under this Agreement; (B) the Assumed
Obligations, in the case of the sale of the Assets, or the business or
operations of the Stations after the Closing Date; and (C)
any taxes owed by Option Holder for any period following the Closing Date.


 


(iii)          From and after the date
hereof, Option Holder shall defend, indemnify and hold harmless Grantor from
and against any and all Damages incurred by Grantor arising out of or resulting
from (A) in the case of the sale of the Assets, the performance of the Company’s
obligations under the Station Purchase Agreement (without limiting the
obligation of the Company pursuant to the terms and subject to the conditions
of that certain letter agreement, dated as of the date hereof, by and among the
parties to this Agreement (the “Letter 


 


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Agreement”)),
(B) the business or operations of the Stations during the period prior to the
Station Closing, (C) any act or omission, event or occurrence that was or shall
be caused by Option Holder, its agents or affiliates (including any predecessor
in interest thereto) relating to the business or operations of Option Holder or
the Stations, (D) the operation of the Stations or the conduct of the business
thereof from and after the Station Closing and continuing through the Option
Period and any extensions thereof (including without limitation in connection
with any fines or penalties imposed by the FCC), except to the extent arising
from, relating to, or as a result of the actions or omissions of Grantor’s
employees and representatives in performing their duties, or in acting outside
the scope of their employment, with respect to the operation of the Stations
during the Option Period and any extensions thereof, which actions or omissions
constitute willful misconduct or gross negligence, and (E) the negotiation and
the document preparation and execution relating to the Station Purchase
Agreement, the Assignment Agreement, this Agreement, the JSA, the SSA and the
Letter Agreement and any amendments thereto; provided,
however, that this paragraph (iii) shall
not extend to Damages to the extent arising out of or resulting from a breach
by Grantor or the Company of their representations, warranties, covenants or
agreements in this Agreement, the Assignment Agreement, the Letter Agreement or
the Station Purchase Agreement or from the gross negligence or willful
misconduct of Grantor or the Company or any of their employees, agents or
affiliates.


 


(iv)          Indemnification
Procedures. If any person entitled to indemnification under this Agreement
(an “Indemnified Party”) asserts a claim
for indemnification for, or receives notice of the assertion or commencement of
any action, suit, claim or legal, administrative, arbitration, mediation,
governmental or other proceeding or investigation, other than any brought by a
party to this Agreement or an Affiliate of a party to this Agreement (a “Third Party Claim”) as to which such
Indemnified Party intends to seek indemnification under this Agreement, such
Indemnified Party shall give reasonably prompt written notice of such claim to
the party from whom indemnification is to be sought (an “Indemnifying
Party”), together with a statement of any available information
regarding such claim. The Indemnifying Party shall have the right, upon written
notice to the Indemnified Party (the “Defense Notice”)
within fifteen (15) days after receipt from the Indemnified Party of notice of
such claim, to conduct at its expense the defense against such Third Party
Claim in its own name, or if necessary in the name of the Indemnified Party
(which notice shall specify the counsel the Indemnifying Party will appoint to
defend such claim (“Defense Counsel”); provided, however, that
the Indemnified Party shall have the right to approve the Defense Counsel,
which approval shall not be unreasonably withheld or delayed). The parties
hereto agree to cooperate fully with each other in connection with the defense,
negotiation or settlement of any Third Party Claim. If the Indemnifying Party
delivers a Defense Notice to the Indemnified Party, the Indemnified Party will
cooperate with and make available to the Indemnifying Party such assistance and
materials as may be reasonably requested by the Indemnifying Party, all at the
expense of the Indemnifying Party.


 


11

















 


(v)           If the Indemnifying
Party shall fail to give a Defense Notice, it shall be deemed to have elected
not to conduct the defense of the subject Third Party Claim, and in such event
the Indemnified Party shall have the right to conduct such defense in good
faith. If the Indemnified Party defends any Third Party Claim, then the
Indemnifying Party shall reimburse the Indemnified Party for the costs and
expenses of defending such Third Party Claim upon submission of periodic bills.
If the Indemnifying Party elects to conduct the defense of the subject Third
Party Claim, the Indemnified Party may participate, at his or its own expense,
in the defense of such Third Party Claim; provided, however, that such Indemnified Party shall be entitled to
participate in any such defense with separate counsel at the expense of the
Indemnifying Party if (A) so requested
by the Indemnifying Party to participate or (B)
in the reasonable opinion of counsel to the Indemnified Party, a conflict or
potential conflict exists between the Indemnified Party and the Indemnifying
Party that would make such separate representation advisable; and provided, further, that
the Indemnifying Party shall not be required to pay for more than one counsel
for all Indemnified Parties in connection with any Third Party Claim.


 


(vi)          Regardless of which
party defends a Third Party Claim, the other party shall have the right at its
expense to participate in the defense of such Third Party Claim, assisted by
counsel of its own choosing. The Indemnified Party shall not compromise,
settle, default on, or admit liability with respect to a Third Party Claim without
the prior written consent of the Indemnifying Party, which consent shall not be
unreasonably withheld or delayed, and, if the Indemnified Party settles,
compromises, defaults on, or admits liability with respect to a Third Party
Claim except in compliance with the foregoing, the Indemnified Party will be
liable for all Losses paid or incurred in connection therewith and the
Indemnifying Party shall have no obligation to indemnify the Indemnified Party
with respect thereto. The Indemnifying Party shall not compromise or settle a
Third Party Claim without the consent of the Indemnified Party, which consent
shall not be unreasonably withheld or delayed, unless such compromise or
settlement includes as a term thereof an unconditional release of the Indemnified
Party and such compromise or release does not impose any non-monetary
obligations on the Indemnified Party other than immaterial administrative
obligations (and all monetary obligations are subject to the indemnification
provisions of this Agreement), in which case the consent of the Indemnified
Party shall not be required.


 


(vii)         After any final decision,
judgment or award shall have been rendered by a court or governmental entity of
competent jurisdiction and the expiration of the time in which to appeal
therefrom, or after a settlement shall have been consummated, or after the
Indemnified Party and the Indemnifying Party shall have arrived at a mutually
binding agreement with respect to a Third Party Claim hereunder, the
Indemnified Party shall deliver to the Indemnifying Party notice of any sums
due and owing by the Indemnifying Party pursuant to this Agreement with respect
to such matter and the Indemnifying Party shall be required to pay all of the
sums so due and owing to the Indemnified Party by wire 


 


12

















 


transfer of immediately
available funds within ten (10) business days after the date of such notice.


 


(viii)        It is the intent of the
parties that all direct claims by an Indemnified Party against a party not
arising out of Third Party Claims shall be subject to and benefit from the
terms of this Section 12(b). Any claim under this Section 12(b) by an
Indemnified Party for indemnification other than indemnification against a
Third Party Claim (a “Direct Claim”)
will be asserted by giving the Indemnifying Party reasonably prompt written
notice thereof, and the Indemnifying Party will have a period of 20 days within
which to satisfy such Direct Claim. If the Indemnifying Party does not so
respond within such 20 day period, the Indemnifying Party will be deemed to
have rejected such claim, in which event the Indemnified Party will be free to
pursue such remedies as may be available to the Indemnified Party under this
Section 12(b).


 


(ix)           A failure by an Indemnified
Party to give timely, complete, or accurate notice as provided in this Section
12(b) shall not affect the rights or obligations of either party hereunder
except to the extent that, as a result of such failure, any party entitled to
receive such notice was deprived of its right to recover any payment under its
applicable insurance coverage or was otherwise materially adversely affected or
damaged as a result of such failure to give timely, complete, and accurate
notice.


 


(x)            The parties shall use
their commercially reasonable efforts to collect the proceeds of any insurance
that would have the effect of reducing any Damages (in which case such proceeds
shall reduce such Losses). To the extent any Damages of an Indemnified Party
are reduced by receipt of payment under insurance policies or from third
parties not affiliated with the Indemnified Party, such payments (net of the
expenses of the recovery thereof) shall be credited against such Damages and,
if indemnification payments shall have been received prior to the collection of
such proceeds, the Indemnified Party shall remit to the Indemnifying Party the
amount of such proceeds (net of the cost of collection thereof) to the extent
of indemnification payments received in respect of such Losses. The indemnification
obligations hereunder shall survive any termination of this Agreement.


 


(c)           NEITHER
PARTY HERETO SHALL BE LIABLE TO THE OTHER FOR INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL OR EXEMPLARY DAMAGES (EVEN IF SUCH PARTY HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES).


 


13.          Specific Performance.
Grantor, the Company and Option Holder acknowledge and agree that, due to the
unique nature of the subject matter of this Agreement, Option Holder would
suffer irreparable damages in the event of breach of this Agreement, which
damages could not adequately be compensated except by specific performance of
this Agreement. Accordingly, without limiting any other remedy that may be
available to Option Holder at law or equity, in the event of a breach by Grantor
or the Company of this Agreement, it is agreed that Option Holder 


 


13





















 


shall be entitled to temporary and permanent
injunctive relief, including, but not limited to, specific performance hereof,
without any showing of actual damage or inadequacy of legal remedy, in any
proceeding before a court of law with proper jurisdiction to hear the matter,
which may be brought to enforce this Agreement. Grantor and the Company hereby
waive any defense that there is an adequate remedy at law for such breach of
this Agreement.


 


14.          Expenses. Option
Holder agrees to reimburse Grantor, within fifteen days of invoicing with
reasonable documentation, for its reasonable and customary fees, costs and
out-of-pocket expenses, including filing fees and reasonable and customary
attorneys’ fees, incurred in connection with the performance of its covenants
and obligations hereunder; provided, however, that, for the avoidance of doubt, Option Holder
shall have no reimbursement obligation with respect to claims, actions or
proceedings brought by or on behalf of Grantor against Option Holder.


 


15.          Further Assurances.
Subject to the terms and conditions of this Agreement, each of the parties
hereto will use all commercially reasonable efforts to take, or cause to be
taken, all actions, and to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to consummate and
make effective the transactions contemplated by this Agreement.


 


16.          Amendment and
Modification. This Agreement may be amended, modified or supplemented
only by written agreement of Grantor, the Company and Option Holder.


 


17.          Waiver of Compliance;
Consents. Except as otherwise provided in this Agreement, any failure
of any of the parties to comply with any obligation, representation, warranty,
covenant, agreement or condition herein may be waived by the party entitled to
the benefits thereof only by a written instrument signed by the party granting
such waiver, but such waiver or failure to insist upon strict compliance with
such obligation, representation, warranty, covenant, agreement or condition
shall not operate as a waiver of, or estoppel with respect to, any subsequent
or other failure. Whenever this Agreement requires or permits consent by or on
behalf of any party hereto, such consent shall be given in writing in a manner
consistent with the requirements for a waiver of compliances as set forth in
this Section 17.


 


18.          Notices. All
notices, requests, demands and other communications which are required or may
be given pursuant to the terms of this Agreement shall be in written or
electronic form, and shall be deemed delivered (a) on the date of delivery
when (i) delivered by hand or (ii) sent by reputable overnight courier maintaining records
of receipt and (b) on the date of transmission when sent by facsimile or
other electronic transmission during normal business hours with confirmation of
transmission by the transmitting equipment; provided,
however, that any such communication delivered by facsimile or other
electronic transmission shall only be effective if such communication is also
delivered by hand or deposited with a reputable overnight courier maintaining
records of receipt within two business days after its delivery by facsimile or
other electronic transmission. All such communications shall be addressed to
the parties at the address set forth in Exhibit
C, or at such other address as a party may designate upon ten days’
prior written notice to the other party.


 


14





















 


19.          Assignment. This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns, but, except as provided for herein, neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by Grantor or
the Company without the prior written consent of Option Holder, which consent
shall not be unreasonably withheld. Without the consent of Grantor and the
Company, Option Holder may assign its rights and obligations under this
Agreement to any other party or parties; provided, however, that Option Holder, as assignor, shall not thereby
be released of its obligations hereunder.


 


20.          No Third Party
Beneficiaries. Except as expressly provided herein, this Agreement is
not intended to, and shall not, confer upon any other person except the parties
hereto any rights or remedies hereunder.


 


21.          Governing Law. The
construction and performance of this Agreement shall be governed by the laws of
the State of New York without giving effect to the choice of law provisions
thereof.


 


22.          Severability. If
any provision of this Agreement or the application thereof to any person or
circumstance shall be invalid or unenforceable to any extent, the remainder of
this Agreement and the application of such provision to other persons or
circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law so long as the economic or legal substance of
the transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination that any term or other provision
is invalid or enforceable, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in any acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the greatest extent possible.


 


23.          Publicity. None
of Grantor, the Company or Option Holder shall make or issue or cause to be
made or issued, any announcement (written or oral) concerning this Agreement or
the transactions contemplated hereby for dissemination to the general public
without the prior consent of the other party. This provision shall not apply,
however, to any announcement or written statement required to be made by law or
the regulations of any federal or state governmental agency or any stock
exchange, except that the party required to make such announcement shall
provide a draft copy thereof to the other party hereto, and consult with such
other party concerning the timing and content of such announcement, before such
announcement is made.


 


24.          FCC Approval.


 


(a)           Notwithstanding
any provision to the contrary herein, Option Holder’s rights under this
Agreement are subject to the Communications Act and the FCC Rules.


 


(b)           As
soon as reasonably practicable, but in no event later than five business days
after Option Holder’s delivery of the Exercise Notice, the parties shall file
an application (the “Consent Application”)
with the FCC requesting the FCC’s written consent to (i) the assignment of the
FCC Licenses from the Company to Option Holder or (ii) the transfer of 


 


15





















 


control of the Company
from Grantor to Option Holder, as the case may be, including, as applicable,
any waiver of such FCC Rules as Option Holder may deem appropriate or desirable
(a “Waiver Request”). In addition, each
party hereto covenants and agrees to (i) prepare,
file and prosecute any alternative application, petition, motion, request
(including any Waiver Request) or other filing (including, upon the request of
Option Holder, any motion for leave to withdraw or dismiss any Consent
Application or other filing made by the parties in connection with the
transactions contemplated by this Agreement) (collectively, the “Additional Applications” and,
together with the Consent Application, the “FCC
Applications”); (ii) file any
amendment or modification to the FCC Applications; (iii)
provide to Option Holder any information, documents or other materials
reasonably requested by Option Holder in connection with the preparation of any
such FCC Applications, including without limitation any Waiver Request; (iv) prosecute the FCC Applications with commercially
reasonable diligence and otherwise use their commercially reasonable efforts to
obtain a favorable conclusion with regard to the FCC Applications; (v) otherwise take any other action with respect to the
FCC as may be reasonably necessary or reasonably requested by Option Holder in
connection with the transactions contemplated hereby; and (vi) cooperate
in good faith with the other party with respect to the foregoing covenants, all
as may be determined by Option Holder to be reasonably necessary or appropriate
or advisable in order to consummate the transactions contemplated hereby upon
the exercise of the Option. Each party shall promptly provide the other with a
copy of any pleading, order or other document served on it relating to the FCC
Applications, shall furnish all information required by the FCC and shall be
represented at all meetings or hearings scheduled to consider the FCC
Application. The FCC’s written consent to the assignment of the FCC Licenses or
transfer of the Subject Shares, as the case may be, contemplated hereby is
referred to herein as the “FCC Consent.”  The parties each agree to comply with any
condition imposed on them by any FCC Consent, except that no party shall be
required to comply with a condition if such condition requires such party to
divest any of its direct or indirect assets. The parties shall oppose any
petitions to deny or other objections filed with respect to the application for
any FCC Consent and any requests for reconsideration or review of any FCC
Consent.


 


25.          Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument. The delivery of an executed counterpart of the Agreement by
facsimile or electronic transmission will be deemed to be an original
counterpart of the Agreement so transmitted.


 


26.          Headings. The
section headings contained in this Agreement are solely for the purpose of
reference, are not part of the agreement of the parties and shall not in any
way affect the meaning or interpretation of this Agreement.


 


27.          Entire Agreement.
This Agreement, including the documents delivered pursuant to this Agreement or
other written agreements referring specifically to this Agreement, and the
Letter Agreement embody the entire agreement and understanding of the parties
hereto in respect of the transactions contemplated by this Agreement. The
Schedule(s) and Exhibit(s) hereto are an integral part of this Agreement and
are incorporated by reference herein. This Agreement supersedes all prior
negotiations, agreements and understandings between the parties with respect to
the transactions contemplated by this Agreement and all letters of intent and
other 


 


16





















 


writings executed
prior to the date hereof relating to such negotiations, agreements and
understandings.


 


28.          Sale of Station WPBN-TV
and WTOM-TV. In the event that Barrington Traverse City License LLC (i)
sells all or substantially all of the assets, including the FCC licenses, of
television broadcast stations WPBN-TV and WTOM-TV and (ii) Option Holder does
not exercise the Option within 30 days of the closing of such sale or otherwise
notifies Grantor of Option Holder’s intention to not exercise the Option
following the closing of such sale, then Grantor and the Company shall have the
right, in their sole discretion, to terminate this Agreement effective
immediately upon written notice to Option Holder.


 


 


[SIGNATURE PAGE FOLLOWS]


 


17

















 


IN WITNESS WHEREOF, the undersigned have executed this Option Agreement
as of the day and year first written above.


 


 


	
   

  	
  GRANTOR:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TUCKER
  MEDIA AND MANAGEMENT 

  CONSULTING L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Benjamin W.
  Tucker

  
	
   

  	
  Name: Benjamin
  W. Tucker

  
	
   

  	
  Title:   Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  TUCKER
  BROADCASTING OF TRAVERSE 

  CITY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Benjamin W.
  Tucker

  
	
   

  	
  Name: Benjamin
  W. Tucker

  
	
   

  	
  Title:   President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OPTION
  HOLDER:

  
	
   

  	
   

  
	
   

  	
  BARRINGTON
  TRAVERSE CITY LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul M.
  McNicol

  
	
   

  	
  Name: Paul M.
  McNicol

  
	
   

  	
  Title:   Senior Vice President/Secretary

  



 

















 


Exhibit A – Form of Assignment Agreement


 


This Assignment and Assumption Agreement (this “Agreement”) is made as of [                          ],
20[    ], by and among TUCKER BROADCASTING OF
TRAVERSE CITY, INC., a Delaware corporation (“Seller”),
TUCKER MEDIA AND MANAGEMENT CONSULTING L.L.C.,
a Delaware limited liability company (“Parent”),
and BARRINGTON TRAVERSE CITY LLC, a
Delaware limited liability company (“Buyer”).


 


W I T N E S S E T H:


 


WHEREAS, Seller, Parent and
Buyer are parties to that certain Option Agreement, dated as of [              ],
2007 (the “Option Agreement”); and


 


WHEREAS, Seller and Parent
desire to assign to Buyer all of Seller’s and Parent’s right, title and
interest in, to and under the contracts relating to the business of the
Stations (as defined in the Option Agreement) (collectively, the “Assumed Contracts”), and Buyer is
willing to accept assignment of such rights and assume such duties and
obligations arising under or in connection with the Assumed Contracts, in each
case pursuant to the terms and subject to the conditions of the Option
Agreement and this Agreement (including Section 6 hereof).


 


NOW, THEREFORE, in consideration
of the foregoing and for other good and valuable consideration, the receipt and
sufficiency of which the parties acknowledge, Seller, Parent and Buyer,
intending to be legally bound, hereby agree as follows:


 


1.     Defined Terms; Interpretation. Except as
otherwise set forth herein, capitalized terms used herein have the meanings
assigned to them in the Option Agreement.


 


2.     Assignment and Assumption. Pursuant to
the terms and subject to the conditions of the Option Agreement and effective
as of the date hereof, (a) Seller and Parent hereby convey, assign, and
transfer to Buyer, its successors and assigns, all of Seller’s and Parent’s
rights, titles and interests in, to and under the Assumed Contracts, free and
clear of any and all liens, and delegate to Buyer all of their respective
duties and obligations to be performed, or arising on or after the date hereof
in connection with or under the Assumed Contracts, and (b) Buyer hereby accepts
the above assignment of rights and delegation of duties and obligations and
agrees to be bound by and to assume such duties and obligations arising under
or in connection with the Assumed Contracts to be performed or arising on or
after the date hereof.


 


3.     Further Assurances. Each party to this
Agreement agrees to execute, acknowledge, deliver, file and record, and to
cause to be executed, acknowledged, delivered, filed and recorded, such further
certificates, instruments, and documents and to do, and cause to be done, all
such other acts and things, as may be required by law, or as may, in the
reasonable opinion of the other party hereto, be necessary or advisable to
carry out the purposes of this Agreement.


 


4.     Binding Effect; Amendments. This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective legal representatives, successors and assigns. No
modification, amendment or waiver of any provision of, or consent or approval
required by, this Agreement, nor any consent to or approval of any departure
herefrom, shall be effective unless it is in writing and signed by the party
against whom enforcement of any such modification, amendment, waiver, consent
or approval is sought.


 

















 


5.     Governing Law. Construction and
interpretation of this Agreement shall be governed by the laws of the State of
New York, excluding any conflicts or choice of law rule or principle that might
otherwise refer construction or interpretation of this Agreement to the
substantive law of another jurisdiction.


 


6.     Option Agreement Controlling. Notwithstanding any other provisions of this
Agreement to the contrary, nothing contained herein shall in any way supersede,
modify, replace, amend, change, rescind, waive, exceed, expand, enlarge or in
any way affect the provisions, including warranties, covenants, agreements,
conditions, representations or, in general, any of the rights and remedies, or
any of the obligations, of Seller, Parent or Buyer set forth in the Option
Agreement. This Agreement is subject to and controlled by the terms of the
Option Agreement.


 


7.     Counterparts. This Agreement may be
executed in any number of counterparts, and each such counterpart hereof shall
be deemed to be an original instrument, but all such counterparts together
shall constitute but one agreement. Delivery of an executed counterpart of a
signature page of this Agreement by facsimile or other electronic transmission
shall be effective as delivery of a manually executed original counterpart of
this Agreement.


 


[Remainder of
page intentionally left blank; signature page follows]


 

















 


IN
WITNESS WHEREOF, each of the parties has caused this
Agreement to be duly executed and delivered as of the day and year first above
written.


 


 


	
  Tucker
  Broadcasting of Traverse City, Inc.  

  	
  Barrington
  Traverse City LLC  

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name: 

  	
  Name:
  

  
	
   

  	
  Title:

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Tucker
  Media and Management Consulting

  L.L.C.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  Name: 

  	
   

  
	
   

  	
  Title:

  	
   

  



 

















 


Exhibit B – Form of Assignment and Assumption
Agreement FCC Licenses


 


ASSIGNMENT
AND ASSUMPTION AGREEMENT


FCC
LICENSES


 






 


This ASSIGNMENT AND ASSUMPTION
AGREEMENT, dated as of                 ,
200     (“Agreement”),
is made, executed and delivered by Tucker Media and Management Consulting
L.L.C., a Delaware limited liability company (“Parent”),
Tucker Broadcasting of Traverse City, Inc., a Delaware corporation (the “Company”, and together with Parent, “Assignor”), and Barrington Traverse
City LLC, a Delaware limited liability company (“Assignee”).


 


W  I  T  N  E
S  S  E  T  H:


 


WHEREAS, pursuant to Assignee’s
exercise of the option to purchase, among other assets, the FCC Licenses listed
on Attachment A attached hereto (the “FCC Licenses”)
granted to Assignee by Assignor under that certain Option Agreement, dated as
of                     ,
2007, by and among Parent, the Company and Assignee (the “Option
Agreement”), Assignor has agreed to convey and assign to
Assignee, and Assignee has agreed to assume, subject to the consent of the
Federal Communications Commission (the “FCC”), the
FCC Licenses;


 


WHEREAS, the FCC has granted its
consent to the assignment of the FCC Licenses from Assignor to Assignee; and


 


WHEREAS, Assignor desires to
transfer and assign to Assignee all of Assignor’s right, title and interest in
and to the FCC Licenses and Assignee desires to assume Assignee’s obligations
with respect thereto;


 


NOW, THEREFORE, in consideration
of the premises and the mutual covenants and agreements herein contained, and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, Assignor and Assignee, intending to be legally bound,
hereby agree as follows:


 


1.             Capitalized
terms used herein but not defined herein shall have the meanings ascribed to
such terms in the Option Agreement.


 


2.             Assignor
does hereby assign and deliver to Assignee all right, title and interest in and
to the FCC Licenses. Assignor shall remain liable for all of the obligations
and liabilities arising under the FCC Licenses insofar as such obligations and
liabilities relate to the time period prior to the Closing Date.


 


3.             Assignee
hereby agrees that it shall assume and discharge and perform, insofar as they
relate to the time period beginning on and after the Closing Date, all the
obligations and liabilities of Assignor under the FCC Licenses. Assignee shall
not assume any other obligations or liabilities of the Assignor pursuant to
this Agreement.


 

















 


4.             Assignor
and Assignee shall each execute and deliver such other documents and take such
other actions as the other party hereto may reasonably request, at the FCC or
otherwise, to confirm the assignment executed hereby and to vest title in and
to the FCC Licenses in Assignee, except that Assignee shall promptly execute
and file a consummation notice at the FCC as required by FCC Rules, a copy of
which shall be delivered to Assignor.


 


5.             Notwithstanding
any other provisions of this Agreement to the contrary, nothing contained
herein shall in any way supersede, modify, replace, amend, change, rescind,
waive, exceed, expand, enlarge or in any way affect the provisions, including
warranties, covenants, agreements, conditions, representations or, in general,
any of the rights and remedies, and any of the obligations, of Assignor set
forth in the Purchase Agreement, including, without limitation, any limits on
indemnification specified therein. This Agreement is subject to and controlled
by the terms of the Purchase Agreement. Nothing contained herein is intended to
modify or supersede any of the provisions of the Purchase Agreement.


 


6.             This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns.


 


7.             This
Agreement shall be governed, construed and enforced in accordance with the laws
of the State of New York (without regard to the choice of law provisions
thereof).


 


8.             This
Agreement cannot be amended, supplemented, or changed except by an agreement in
writing that is signed by the parties hereto.


 


9.             This
Agreement may be executed in any number of counterparts and by facsimile, each
of which will be deemed an original, but all of which together will constitute
one and the same instrument.


 

















 


IN WITNESS
WHEREOF, the Company, Parent and Assignee have executed this Agreement as of
the date first above written.


 


	
   

  	
  TUCKER
  BROADCASTING OF TRAVERSE 

  CITY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: 

  
	
   

  	
   

  	
  Title:  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TUCKER
  MEDIA AND MANAGEMENT 

  CONSULTING L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: 

  
	
   

  	
   

  	
  Title: 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BARRINGTON
  TRAVERSE CITY LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name: 

  
	
   

  	
   

  	
  Title: 

  
				



 

















 


Exhibit C - Notices


 


If to Option Holder, to:


 


Barrington
Traverse City LLC


745 Fifth Avenue


24th Floor


New York, NY  10151


Attention:  Paul
McNicol


Fax:  (212)
486-2896


 


with a
copy (which shall not constitute notice) to:


 


Barrington Broadcasting LLC


2500 West Higgins Road, Suite 880


Hoffman Estates, IL 60195


Attention:  K.
James Yager


Fax: 
847-755-3045


 


and


 


Covington & Burling LLP


1201 Pennsylvania Ave., N.W.


Washington,
D.C. 20004-2401


Fax:   202-662-6291


Attention:   Eric
Dodson Greenberg, Esq.


 


If to
Grantor or the Company to:


 


Tucker Broadcasting of Traverse City, Inc.


Attention:  Ben
Tucker, President


9434 N. Sunset Ridge


Fountain Hills, AZ 85268


Phone: 
(480)836-2181


Email: 
bentucker13@cox.net


 


With a copy (which shall not constitute notice) to:


 


Pillsbury Winthrop Shaw Pittman LLP


2300 N Street, NW


Washington, DC 20037-1122


Attention: 
Clifford M. Harrington


Phone: 
202-663-8525


Fax: 
202-663-8007


 

















 


Schedule 5(a)


 


1.             For purposes of this
Agreement, the “Base Value” shall be an
amount equal to the aggregate amount payable by the Company at the Station
Closing pursuant to the Station Purchase Agreement; provided,
however,  that
in the event that the Company shall have elected to borrow the purchase price
with respect to its payment obligations under the Station Purchase Agreement
pursuant to an Acquisition Financing Arrangement, the “Base Value” shall equal
the Outstanding Debt.


 


2.             For purposes of this
Agreement, the “Outstanding Debt” shall be an
amount equal to the total outstanding balance of debt, if any, for borrowed
money of the Company pursuant to an Acquisition Financing Arrangement.


 


3.             For purposes of this
Agreement, the “Escalation Amount” shall be
an amount equal to the greater of (A) the Fixed
Appreciation Amount or (B) the Net
Broadcast Cash Flow Amount.


 


For purposes hereof, the “Fixed Appreciation Amount” equals
the product of (i) the number of calendar years
(including fractions of years) during the Option Period prior to the exercise
of the Option, times (ii)
an amount equal to $27,000; “Net Broadcast Cash Flow
Amount” means the product of (x)
the number of calendar years (including fractions of years) during the Option
Period prior to the exercise of the Option, times (y) the average net broadcast cash flow (as determined by
Option Holder) for the preceding 12-month period (or if the Option is exercised
prior to the first anniversary of the Effective Date, the average net broadcast
cash flow for the period following the Effective Date); provided,
however, that the Net Broadcast Cash
Flow Amount shall not exceed $54,000. Solely with respect to that portion of
the Cash Purchase Price constituting the Escalation Amount, the parties shall
apply as a credit against such amount an amount equal to $5,000 multiplied by
the number of months (including fractions of months) between the date of the
Station Closing and the date of the Option Closing. In no event shall the
Escalation Amount result in an internal rate of return that is less than zero.