UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended SeptemberJune 30, 20052007

Commission File Number: 000-27105

ACME COMMUNICATIONS, INC.
(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)

33-0866283
(I.R.S. employer
identification no.)

2101 E. Fourth Street, Suite 202 A
Santa Ana, California, 92705
(714) 245-9499
(Address and telephone number of principal executive offices)

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, and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Securities registered pursuant to Section 12(b) of the Act:
Title of each class		Name of each exchange on which registered
Common Stock, par value $.01 per share		The NASDAQ Stock Market, LLC (NASDAQ Global Market)

Indicate by check mark whether the registrant is(1) has anfiled ~~accelerated~~all ~~filer~~reports ~~(as~~required ~~defined~~to inbe ~~Rule~~filed by ~~12b-2~~Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

AsIndicate ofby ~~November~~check 8,mark ~~2005,~~whether ~~ACME~~the registrant ~~Communications,~~is ~~Inc.~~a ~~had~~large 16accelerated filer,~~772,415~~ ~~shares~~an ofaccelerated ~~common~~filer, ~~stock~~or ~~outstanding~~a non-accelerated filer (~~including~~as ~~725,652~~defined ~~shares~~in ~~held~~Rule 12b-2 inof ~~treasury~~the Exchange Act).

ACME COMMUNICATIONS, INC. FORM 10–QTABLE OF CONTENTS
		Page
Part I – Financial Information
Item 1.	Financial Statements
	Consolidated Balance Sheets as of September 30, 2005 (unaudited) and December 31, 2004	1
	Consolidated Statements of Operations for the Three Months and Nine Months Ended September 30, 2005
	and September 30, 2004 (unaudited) and September 30, 2004 (unaudited)	2
	Consolidated Statements of Stockholders' Equity for the Nine Months Ended September 30, 2005 (unaudited)	3
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2005 and September 30, 2004 (unaudited)	4
	Notes to Consolidated Financial Statements (unaudited)	5
Item 2.	Management's Discussion and Analysis of Financial Condition and Results Of Operations	8
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	12
Item 4.	Controls and Procedures	12
Part II – Other Information
Item 2.	Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities	13
Item 6.	Exhibits	13

Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X]

~~Signature~~ Indicate by 14check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

ACME Communications, Inc. and Subsidiaries Consolidated Balance Sheets(in thousands, except for par value data)
	September 30, 2005			December 31, 2004
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,625		$	1,679
Restricted cash		50			64
Accounts receivable, net		8,064			9,174
Current portion of programming rights		8,849			11,107
Prepaid expenses and other current assets		748			911
Assets held for sale		21,046			--
Total current assets		40,382			22,935
Property and equipment, net		25,135			29,840
Programming rights, net of current portion		11,337			17,047
Intangible assets, net		86,831			96,791
Other assets		3,738			4,549
Total assets	$	167,423		$	171,162
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	5,516		$	6,964
Accrued liabilities		4,361			4,583
Current portion of programming rights payable		7,771			12,329
Current portion of obligations under lease		47			45
Income taxes payable		41			50
Notes payable under revolving credit facility		31,667			--
Note payable under second-lien term loan		20,000			--
Liabilites held for sale		8,542			--
Total current liabilities		77,946			23,971
Programming rights payable, net of current portion		12,302			16,851
Obligations under lease, net of current portion		907			943
Other liabilities		86			167
Deferred income taxes		10,464			8,900
Notes payable under revolving credit facility		--			24,554
Note payable under second-lien term loan		--			20,000
Total liabilities		101,704			95,386
Minority interest		877			624
Stockholders' equity:
Preferred stock, $.01 par value; 10,000,000 shares authorized, no
shares issued or outstanding		--			--
Common stock, $.01 par value; 50,000,000 shares authorized, 16,772,415 shares
issued and outstanding at September 30, 2005 and December 31, 2004		168			168
Additional paid-in capital		132,038			132,038
Accumulated deficit		(62,364	)		(52,054	)
Less: Treasury stock, at cost; 725,652 shares		(5,000	)		(5,000	)
Total stockholders' equity		64,842			75,152
Total liabilities and stockholders' equity	$	167,423		$	171,162

As of the last business day of the registrant’s most recently completed second fiscal quarter (June 29, 2007), the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was $63,878,171 based on a price of $5.01 per share, as reported on the NASDAQ Stock Market.

~~See~~ As ~~the~~of ~~notes~~August to14, ~~the~~2007, ~~consolidated~~ACME ~~financial~~Communications, ~~statements~~Inc. had 16,046,763 shares of common stock outstanding.

ACME COMMUNICATIONS, INC. FORM 10–Q TABLE OF CONTENTS
		Page
Part I – Financial Information

Item 1.	Financial Statements
	Consolidated Balance Sheets as of June 30, 2007 (Unaudited) and December 31, 2006	1
	Consolidated Statements of Operations (Unaudited) for the Three Months and Six Months Ended June 30, 2007 and June 30, 2006	2
	Consolidated Statement of Stockholders' Equity (Unaudited) for the Six Months Ended June 30, 2007	3
	Consolidated Statements of Cash Flows (Unaudited) for the Six Months Ended June 30, 2007 and June 30, 2006	4
	Notes to Consolidated Financial Statements (Unaudited)	6
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	10
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	14
Item 4.	Controls and Procedures	14

Part II – Other Information

Item 1.	Legal Proceedings	15
Item 1A.	Risk Factors	15
Item 2.	Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities	15
Item 4.	Submission of Matters to a Vote of Security Holders	15
Item 5.	Other Information	15
Item 6.	Exhibits	15

Signature		16

ACME Communications, Inc. and Subsidiaries Consolidated Statements of Operations (Unaudited)(In thousands, except per share data)
ACME Communications, Inc. and Subsidiaries Consolidated Balance Sheets(in thousands, except share data)
	Three Months Ended September 30,						Six Months Ended September 30,
	June 30, 2007			December 31, 2006
	2005			2004			2005			2004
	(Unaudited)
Net revenues	$	10,097		$	9,429		$	30,364		$	28,860
ASSETS
Operating expenses:
Current assets:
Cost of service:
Cash and cash equivalents	$	763		$	1,113
Programming, including program amortization		4,180			3,869			12,437			11,375
Restricted cash		50			50
Other costs of service (excluding depreciation and amortization of $1,176 and $1,061
Accounts receivable, net		6,520			7,878
for the three months ended September 30, 2005 and 2004, respectively, and $3,508
Current portion of programming rights		5,444			5,400
and $3,249 for the nine months ended September 30, 2005 and 2004, respectively)		1,522			1,419			4,850			4,501
Prepaid expenses and other current assets		296			332
Selling, general and administrative expenses		3,964			3,779			11,649			11,673
Assets held for sale		5,841			25,429
Depreciation and amortization		1,186			1,074			3,529			3,275
Total current assets		18,914			40,202
Corporate expenses		887			949			2,519			2,768
Property and equipment, net		15,813			15,701
Operating expenses		11,739			11,090			34,984			33,592
Programming rights, net of current portion		11,901			14,715
Operating loss		(1,642	)		(1,661	)		(4,620	)		(4,732	)
Goodwill, net		14,721			14,721
Other income (expenses):
Broadcast licenses, net		51,774			51,774
Interest income		3			2			6			6
Other assets		483			2,131
Interest expense		(946	)		(472	)		(2,513	)		(1,147	)
Total assets	$	113,606		$	139,244
Gain on sale of construction permit		--			--			1,202			--
LIABILITIES AND STOCKHOLDERS' EQUITY
Other, net		43			(2	)		47			29
Current liabilities:
Loss before income taxes, minority interest and discontinued operations		(2,542	)		(2,133	)		(5,878	)		(5,844	)
Accounts payable	$	2,663		$	3,261
Income tax expense		(563	)		(814	)		(1,719	)		(1,922	)
Accrued liabilities		5,021			5,043
Loss before minority interest and discontinued operations		(3,105	)		(3,947	)		(7,597	)		(7,766	)
Current portion of programming rights payable		5,888			5,963
Minority interest		149			264			461			721
Current portion of obligations under lease		48			50
Loss from continuing operations		(2,956	)		(2,683	)		(7,136	)		(7,045	)
Income taxes payable		1,619			151
Discontinued operations:
Notes payable under revolving credit facility		2,359			36,550
Loss from discontinued operations		(952	)		(1,464	)		(3,174	)		(3,245	)
Liabilities held for sale		1,662			6,562
Income tax expense		--			(411	)		--			(411	)
Total current liabilities		19,260			57,580
Loss from discontinued operations		(952	)		(1,875	)		(3,174	)		(3,656	)
Programming rights payable, net of current portion		12,679			15,605
Net loss	$	(3,908	)	$	(4,558	)	$	(10,310	)	$	(10,701	)
Obligations under lease, net of current portion		822			845
Net loss per share, basic and diluted
Other liabilities		252			33
Continuing operations	$	(0.18	)	$	(0.17	)	$	(0.44	)	$	(0.43	)
Deferred income taxes		10,524			9,751
Discontinued operations		(0.06	)		(0.12	)		(0.20	)		(0.22	)
Total liabilities		43,537			83,814
Net loss per share	$	(0.24	)	$	(0.28	)	$	(0.64	)	$	(0.65	)
Commitments and contingencies
Weighted average basic and diluted common shares outstanding		16,047			16,077			16,047			16,527
Stockholders' equity:
Preferred stock, $0.01 par value; 10,000,000 shares authorized, no
shares issued or outstanding		--			--
Common stock, $0.01 par value; 50,000,000 shares authorized, 16,772,415 shares
issued and 16,046,763 outstanding at June 30, 2007 and December 31, 2006		168			168
Additional paid-in capital		132,656			132,440
Accumulated deficit		(57,755	)		(72,178	)
Less: Treasury stock, at cost; 725,652 shares		(5,000	)		(5,000	)
Total stockholders' equity		70,069			55,430
Total liabilities and stockholders' equity	$	113,606		$	139,244

See the accompanying notes to the unaudited consolidated financial statements.

ACME Communications, Inc. and Subsidiaries Consolidated Statement of Stockholders' Equity(Unaudited)(In thousands)
ACME Communications, Inc. and Subsidiaries Consolidated Statements of Operations (Unaudited)(In thousands, except per share data)
	Common StockShares Amount						AdditionalPaid-in Capital			Accumulated Deficit			Treasury Stock			Total Stockholders' Equity
	Three Months Ended June 30,						Six Months Ended June 30,
Balance at December 31, 2004		16,772		$	168		$	132,038		$	(52,054	)	$	(5,000	)	$	75,152
	2007			2006			2007			2006
Net loss		--			--			--			(10,310	)		--			(10,310	)
Net revenues	$	8,349		$	8,707		$	15,571		$	16,664
			>
Operating expenses:
Balance at September 30, 2005		16,772		$	168		$	132,038		$	(62,364	)	$	(5,000	)	$	64,842
Cost of service:
Programming, including program amortization		3,203			3,346			5,481			6,765
Other costs of service (excluding depreciation and amortization of $800 and $917
for the three months ended June 30, 2007 and 2006, respectively, and $1,584
and $1,840 for the six months ended June 30, 2007 and 2006, respectively)		1,313			1,340			2,537			2,528
Selling, general and administrative expenses		2,910			2,959			5,844			5,979
Depreciation and amortization		807			924			1,598			1,860
Corporate expenses		1,049			920			1,886			1,801
Operating expenses		9,282			9,489			17,346			18,933
Operating loss		(933	)		(782	)		(1,775	)		(2,269	)
Other income (expenses):
Interest income		6			28			34			33
Gain on sale of assets		--			69			--			69
Equity in losses of unconsolidated affiliates		--			(60	)		(251	)		(68	)
Loss from continuing operations before income taxes and minority interest		(927	)		(745	)		(1,992	)		(2,235	)
Income tax expense		(43	)		(258	)		(79	)		(898	)
Loss from continuing operations before minority interest		(970	)		(1,003	)		(2,071	)		(3,133	)
Minority interest income		--			233			--			463
Loss from continuing operations		(970	)		(770	)		(2,071	)		(2,670	)
Discontinued operations (see Note 3):
Income (loss) from discontinued operations, before income taxes		(880	)		4,628			24,723			2,873
Income tax benefit (expense)		42			(98	)		(207	)		(197	)
Income (loss) from discontinued operations		(838	)		4,530			24,516			2,676
Net income (loss)	$	(1,808	)	$	3,760		$	22,445		$	6
Net income (loss) per share, basic and diluted:
Continuing operations	$	(0.06	)	$	(0.05	)	$	(0.13	)	$	(0.17	)
Discontinued operations		(0.05	)		0.28			1.53			0.17
Net income (loss) per share	$	(0.11	)	$	0.23		$	1.40		$	0.00
Weighted average basic and diluted common shares outstanding		16,047			16,047			16,047			16,047

See the accompanying notes to the unaudited consolidated financial statements.

ACME Communications, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Unaudited)(In thousands)
ACME Communications, Inc. and Subsidiaries Consolidated Statements of Stockholders' Equity(Unaudited)(In thousands)
	Nine Months Ended September 30,
	Common StockShares Amount						AdditionalPaid-in Capital		Accumulated Deficit			Treasury Stock			Total Stockholders' Equity
	2005			2004
Balance at December 31, 2006		16,772		$	168		$	132,440	$	(72,178	)	$	(5,000	)	$	55,430
Cash flows from operating activities:
Stock-based compensation		--			--			216		--			--			216
Net loss from continuing operations	$	(7,136	)	$	(7,045	)
Cash dividends		--			--			--		(8,022	)		--			(8,022	)
Adjustments to reconcile loss to net cash used in operating activities:
Net income		--			--			--		22,445			--			22,445
Minority interest		(461	)		(721	)
Balance at June 30, 2007		16,772		$	168		$	132,656	$	(57,755	)	$	(5,000	)	$	70,069
Provision for doubtful accounts receivable		294			276
Depreciation and amortization		3,529			3,275
Amortization of program rights		6,490			6,098
Amortization of debt issuance costs		732			578
Amortization of deferred compensation		--			34
Gain on sale of construction permit		(1,202	)		--
Deferred taxes		1,564			1,697
Changes in assets and liabilities:
(Increase) decrease in accounts receivables		591			(185	)
(Increase) decrease in prepaid expenses and other current assets		187			(352	)
Increase in other assets		(836	)		(137	)
Increase (decrease) in accounts payable		(1,239	)		13
Increase in accrued liabilities		576			904
Increase (decrease) in taxes payable		(9	)		322
Payments of programming rights payable		(6,599	)		(5,811	)
Increase (decrease) in other liabilities		(72	)		11
Net cash used in operating activities		(3,591	)		(1,043	)
Cash flows from investing activities:
Purchase of property and equipment		(1,730	)		(5,382	)
Purchases of and deposits for station interests		--			(177	)
Proceeds from sale of assets		185			--
Proceeds from sale of construction permit		1,500			--
Net cash used in investing activities		(45	)		(5,559	)
Cash flows from financing activities:
Contributions by minority stockholer		714			1,350
Net borrowings under revolving credit facility		7,113			13,231
Payment of financing costs on credit facilities		(564	)		(374	)
Cash restricted as escrow deposits and collateral under capital lease facilities		14			1,920
Payments on capital lease obligations		(34	)		(2,037	)
Purchase of treasury stock		--			(5,000	)
Proceeds from the issuance of common stock		--			40
Net cash provided by financing activities		7,243			9,130
Increase in net cash from continuing operations		3,607			2,528
Cash used in discontinued operations		(3,661	)		(2,065	)
Increase (decrease) in cash		(54	)		463
Cash at beginning of period		1,679			1,197
Cash at end of period	$	1,625		$	1,660
Cash payments for:
Interest	$	3,165		$	1,503
Taxes	$	146		$	314
Non-cash transactions:
Program rights in exchange for program rights payable	$	7,489		$	8,458

See the accompanying notes to the unaudited consolidated financial statements.

ACME Communications, Inc. and Subsidiaries Notes to Consolidated Financial Statements (Unaudited)

ACME Communications, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Unaudited) (In thousands)
	Six Months Ended June 30,
	2007			2006
Cash flows from operating activities:
Net income	$	22,445		$	6
Less: Income from discontinued operations, net of tax		(24,516	)		(2,676	)
Adjustments to reconcile income to net cash used in operating activities:
Minority interest income		--			(463	)
Equity in losses of unconsolidated affiliates		251			68
Provision for doubtful accounts receivable		121			138
Depreciation and amortization		1,598			1,860
Amortization of program rights		2,827			3,086
Stock-based compensation		209			160
Deferred income taxes		773			822
Changes in assets and liabilities:
Decrease (increase) in accounts receivables		114			(411	)
Increase in prepaid expenses and other current assets		38			10
Decrease in accounts payable		(728	)		(570	)
Decrease in accrued liabilities		(300	)		(384	)
Increase (decrease) in income taxes payable		(760	)		32
Payments of programming rights payable		(3,054	)		(3,209	)
Increase in other liabilities		219			33
Net cash used in continuing operating activities		(763	)		(1,498	)

Cash flows from investing activities:
Purchase of property and equipment		(1,114	)		(226	)
Investment in unconsolidated subsidiaries		(155	)		--
Proceeds from sale of CarSoup investment		--			1,111
Proceeds from sale of assets - discontinued operations		43,960			18,384
Net cash provided by investing activities		42,691			19,269

See the accompanying notes to the unaudited consolidated financial statements.

ACME Communications, Inc. and Subsidiaries Consolidated Statements of Cash Flows (Unaudited) (In thousands)
	Six Months Ended June 30,
	2007			2006
Cash flows from financing activities:
Cash contributions by joint venture partner	$	--		$	332
Borrowings under revolving credit facility		2,359			23,645
Payments on revolving credit facility		(36,550	)		(18,400	)
Payments on second-lien credit facility		--			(20,000	)
Payments on capital lease obligations		(25	)		(22	)
Payment of dividend		(8,022	)		--
Net cash used in financing activities		(42,238	)		(14,445	)

Increase (decrease) in net cash from continuing operations		(310	)		3,326
Reconsolidation of The Daily Buzz, LLC at March 31, 2007		21			--
Discontinued operations:
Net cash provided by (used in) operating activities		3			(917	)
Net cash used in investing activities		(29	)		(67	)
Net cash used in financing activities		(35	)		(1,306	)
Net cash used in discontinued operations		(61	)		(2,290	)

Increase (decrease) in cash and cash equivalents		(350	)		1,036
Cash and cash equivalents at beginning of period		1,113			1,141
Cash and cash equivalents at end of period	$	763			2,177

Cash payments for:
Interest	$	887			2,110
Taxes	$	366			44

Non-cash transactions:
Program rights in exchange for program rights payable	$	57			7,811

See the accompanying notes to the unaudited consolidated financial statements.

ACME Communications, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)

(1) Formation and Description of the Business

Formation &and Presentation

~~ACME~~The Company commenced operations in 1997 and ACME Communications, Inc. was formed as our holding company on July 23, 1999, in preparation for and in conjunction with an initial public offering of its stock.

On ~~The~~August 8, 2005, the Company announced that it had entered into an agreement to sell ~~accompanying~~station ~~consolidated~~KUWB ~~financial~~serving ~~statements~~the ~~are~~Salt ~~presented~~Lake ~~for~~City ~~ACME~~marketplace ~~Communications~~to Clear Channel Broadcasting, Inc. (the “~~ACME~~Clear Channel Transaction”). orThe Clear Channel Transaction was completed on April 4, 2006. On May 15, 2006, the “Company announced that it had entered into an agreement to sell station WTVK serving the Ft. Myers – Naples, Florida marketplace to Sun Broadcasting, Inc. (the “Sun Transaction”). ~~and~~The ~~its~~Sun ~~wholly~~Transaction was completed on February 16, 2007. On June 14, 2007, the Company entered into an agreement to sell station WBUI serving the Champagne-~~owned~~Springfield-Decatur ~~subsidiaries~~marketplace to GoCom Media of Illinois, LLC (the “GoCom Transaction”). ~~Segment~~The GoCom Transaction, which is subject ~~information~~to approval from the Federal Communication Commission and other customary closing conditions, is ~~not~~expected ~~presented~~to ~~since~~close ~~all~~by the end of 2007. In accordance with U.S. generally accepted accounting principles, the ~~Company’s~~accompanying ~~revenues~~consolidated ~~are~~statement ~~attributed~~of tooperations aand cash flows ~~single~~reflect ~~reportable~~the ~~segment~~results of stations KUWB, WTVK and WBUI as discontinued operations for all periods presented.

The ~~On August~~accompanying 8,consolidated ~~2005,~~financial ~~the~~statements ~~Company~~are ~~announced~~presented ~~that~~for itACME ~~had~~Communications, ~~entered into a transaction to sell its~~Inc. ~~station~~(“ACME” ~~KUWB~~or ~~serving~~ the ~~Salt~~“Company”) ~~Lake~~and ~~City~~its ~~marketplace~~wholly-owned tosubsidiaries, ~~a subsidiary of Clear Channel~~including ~~Communications Inc.~~ The ~~transaction~~Daily isBuzz, ~~contingent~~LLC. ~~upon~~All ~~Clear~~significant ~~Channel~~intercompany ~~selling~~accounts ~~its radio station in the market~~ and ~~subject~~transactions tohave ~~regulatory~~been eliminated ~~approval.~~for Inall ~~accordance~~periods ~~with U~~presented.~~S. generally~~ ~~accepted~~Segment ~~accounting~~information ~~principles,~~is ~~the~~not ~~statements~~presented ofsince ~~operations~~all ~~and cash flows~~of ~~reflect~~ the ~~results~~Company’s ofrevenues ~~this~~are ~~station~~attributed asto ~~discontinued~~a ~~operations~~single ~~for~~reportable ~~all periods presented~~segment. ~~See~~ ~~Note 10 for additional information.~~

The Company adopted the provisions of Financial Accounting Standards Board (“FASB”) Interpretation No. 46R (“FIN 46R”), “Consolidation of Variable Interest Entities”, effective January 1, 2004. On that same date, the Company’s joint venture (The Daily Buzz, LLC) with Emmis Communications (“Emmis”) to produce The Daily Buzz, a weekday morning three-hour television news show, became effective. Under the agreement, the Company made an initial contribution of property and equipment with an agreed fair value and book value of $750,000 and Emmis iswas required to contribute the next $750,000 in capital equipment purchased by the venture. Atand ~~September~~based 30thereon, ~~2005,~~the ~~Emmis~~Company ~~had~~included ~~contributed~~The ~~approximately $705~~Daily Buzz,~~000~~ LLC in its ~~capital~~consolidated ~~equipment~~financial ~~purchases~~statements. ~~Until~~Effective ~~and~~July ~~unless~~1, ~~Emmis~~2006, ~~completes~~when ~~this~~Emmis ~~equalizing~~completed its ~~contribution,~~matching ~~under~~capital ~~FIN 46R~~contribution, the Company iswas no longer deemed the primary beneficiary ~~of the venture~~ and ~~accordingly,~~deconsolidated ~~has consolidated~~ the venture ~~into its financial statements~~. ~~The~~In ~~creditors of~~March ~~the~~2007, ~~venture have no recourse against~~ the Company oracquired ~~Emmis.~~all Inof ~~accordance with FIN 46R,~~ Emmis’ ~~share of the net production costs which were funded through capital~~ ~~contributions~~interest toin the venture ~~during the three~~ and ~~nine~~reconsolidated ~~months~~the ~~ended~~venture ~~September~~effective ~~30,~~March ~~2005 were $149~~31,~~000~~ ~~and~~2007 ~~$461,000,~~using ~~respectively,~~the equity-method ~~compared~~of toaccounting for its ~~share~~results of ~~net~~operations ~~production costs of $264,000 and $721,000~~ for the ~~three~~first ~~and~~quarter ~~nine~~of ~~months~~2007. Effective ~~ended~~April ~~September 30~~1, ~~2004~~2007, ~~respectively.~~ ~~These~~the ~~amounts~~Company ~~have~~included ~~been~~the ~~reflected~~results asof ~~minority~~The ~~interest~~Daily Buzz in ~~the accompanying~~its consolidated ~~statement~~results of operations.

The consolidated financial statements for the periods presented include the consolidated accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated for all periods presented.

Description of the Business

ACME Communications is a holding company with no independent operations other than through its wholly-owned subsidiary, ACME Television, LLC (“ACME Television”). As of June 30, 2007, ACME Television, through its wholly-owned subsidiaries, owns and operates the following ~~ten~~eight commercially licensed, full-power, broadcast television stations located throughout the United States, including KWBR in Roswell, New Mexico, which is a satellite station of KWBQ:

Station	Channel	Marketplace	MarketRank (1)	Network Affiliation
KUWB	30	Salt Lake City, Utah	36	WB
KWBQ/KWBR	19/21	Albuquerque-Santa Fe, New Mexico	45	CW
KWBQ/KWBR	19/21	Albuquerque-Santa Fe, New Mexico	47	WB
KASY	50	Albuquerque-Santa Fe, New Mexico	45	MNT
KASY	50	Albuquerque-Santa Fe, New Mexico	47	UPN
WBDT	26	Dayton, Ohio	58	CW
WBDT	26	Dayton, Ohio	56	WB
WBXX	20	Knoxville, Tennessee	60	CW
WBXX	20	Knoxville, Tennessee	59	WB
WIWB	14	Green Bay-Appleton, Wisconsin	69	CW
WTVK	46	Ft. Myers-Naples, Florida	68	WB
WBUI	23	Champaign-Springfield-Decatur, Illinois	82	CW
WIWB	14	Green Bay-Appleton, Wisconsin	69	WB
WBUW	57	Madison, Wisconsin	85	CW
WBUI	23	Champaign-Springfield-Decatur, Illinois	82	WB
WBUW	57	Madison, Wisconsin	85	WB

(1) based on television households per Nielsen Market Research for the ~~2005~~2006 / ~~2006~~2007 season.

In ~~The Company~~January ~~also~~2006, ~~owns~~CBS, ~~the~~Inc. ~~right~~and toWarner ~~acquire~~Bros. ~~for~~Entertainment, $3Inc.0 ~~million~~announced athat ~~construction~~they ~~permit~~were closing todown ~~build~~their arespective networks, UPN and The WB, effective September 2006 and were creating a jointly owned new network, The CW. On March 9, 2006 the Company entered into an agreement with The CW to affiliate all of its then WB Network ~~affiliate~~affiliated instations ~~Lexington,~~with KYThe CW when that network launched. The ~~acquisition~~term of the ~~Lexington~~new ~~construction~~affiliation agreements are for up to ~~permit~~ten isyears. ~~dependent~~In ~~upon~~its inaugural season, The CW programmed the ~~Federal~~more ~~Communications~~popular ~~Commission~~shows ~~approving~~on UPN and The WB plus others that the ~~underlying~~new network developed. KASY, the Company’s previous UPN ~~application~~affiliated station, entered into an agreement in March 2006 with MyNetworkTV, a new start-up network owned by Newscorp’s Fox unit, which also launched in September 2006.

(2)Recent PresentationAccounting of Interim Consolidated Financial StatementsPronouncements

In ~~The accompanying~~July ~~consolidated~~2006, ~~financial statements for~~ the ~~three~~FASB ~~and~~issued ~~nine~~Interpretation ~~months~~No. ~~ended September 30~~48, ~~2005~~“Accounting ~~and~~for ~~2004~~Uncertainty ~~are~~in Income ~~unaudited~~Taxes” ~~and~~(“FIN ~~have~~48”), ~~been~~which ~~prepared~~clarifies inthe ~~accordance~~accounting ~~with~~for ~~accounting~~uncertainty ~~principles~~in ~~generally~~income ~~accepted~~taxes recognized in the ~~United~~financial ~~States~~statements ofin ~~America,~~accordance ~~the~~with ~~instructions~~the toFASB’s ~~this~~Statement ~~Form 10-Q and Article 10 of Regulation S-X~~No. ~~In the opinion of management~~109, ~~such~~“Accounting ~~financial~~for ~~statements~~Income ~~include~~Taxes” ~~all adjustments~~ (~~consisting of normal~~“FAS ~~recurring accruals~~109”). ~~considered~~FIN ~~necessary~~48 ~~for~~provides ~~the~~guidance ~~fair~~on ~~presentation of~~ the financial ~~position~~ ~~and~~statement ~~the~~recognition ~~results of operations,~~ and ~~cash flows for these periods. As permitted~~ ~~under~~measurement ~~the applicable rules and regulations~~ of ~~the~~a ~~Securities~~tax ~~and~~position ~~Exchange~~taken ~~Commission, these~~or ~~financials~~expected ~~statements~~to dobe ~~not~~taken ~~include~~in ~~all~~a ~~disclosures~~tax ~~and~~return. ~~footnotes~~FIN ~~normally~~48 ~~included~~also ~~with~~provides ~~annual~~guidance ~~consolidated~~on ~~financial~~derecognition, ~~statements~~classification, interest and ~~accordingly~~penalties, ~~should~~accounting ~~be read~~ in ~~conjunction~~interim ~~with~~periods, ~~the~~disclosures ~~consolidated~~and ~~financial~~transition. ~~statements,~~FIN ~~and~~48 ~~the~~is ~~notes~~effective ~~thereto,~~for ~~included~~fiscal inyears ~~the~~beginning ~~Company’s~~after ~~2004~~December ~~Annual~~15, ~~Report~~2006. onThe ~~Form 10-K~~Company ~~filed~~adopted ~~with~~FIN ~~the~~48 ~~SEC~~ on ~~March~~January 161, ~~2005.~~ ~~The~~2007 ~~results~~and ~~of operations presented in~~ the ~~accompanying consolidated financial~~ ~~statements~~adoption ~~are not necessarily indicative~~ of ~~the~~this ~~results~~standard ~~that~~had ~~may~~no beimpact ~~expected~~on ~~for~~ the ~~year ending~~Company’s ~~December 31,~~consolidated ~~2005~~financial statements.

In ~~The accompanying~~September ~~consolidated~~2006, ~~balance~~the ~~sheet~~FASB asissued Statement of ~~December~~Financial 31Accounting Standards (“SFAS”) No. 157, ~~2004~~“Fair Value Measures” (“SFAS 157”). SFAS 157 defines fair value, establishes a framework for measuring fair value and enhances disclosures about fair value measures required under other accounting pronouncements, but does not change existing guidance as to whether or not an instrument is ~~derived~~carried ~~from~~at fair value. SFAS 157 is effective for fiscal years beginning after November 15, 2007, the year ~~audited~~beginning ~~consolidated~~January ~~financial~~1, ~~statements~~2008 ~~included~~for the Company. The Company is still in the process of evaluating the requirements of SFAS 157 and has not yet determined the impact, if any, on the Company’s ~~2004~~consolidated ~~Annual Report~~financial statements.

In ~~Certain~~September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for ~~amounts~~Defined ~~previously~~Benefit ~~reported~~Pension inand ~~2004~~Other ~~have~~Postretirement ~~been~~Plans ~~reclassified~~— toan ~~conform~~amendment toof FASB Statements NO. 87, 88, 106 and 132(R)", (“SFAS 158”). SFAS 158 requires recognition of the ~~2005~~overfunded or underfunded status of a benefit postretirement ~~financial~~plan in the statement ~~presentation~~of financial position, as well as recognition of changes in that funded status through comprehensive income in the year in which they occur. SFAS 158 also requires a change in the measurement of a plan’s assets and benefit obligations as of the end date of the employer’s fiscal year. SFAS 158 is effective for fiscal years ending after December 15, 2006, except for the measurement date provisions, which are effective for fiscal years ending after December 15, 2008. As the Company has never had any defined benefit plans or unfunded liabilities, the adoption of this standard did not have any impact on the Company’s consolidated financial statements.

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities” (3“SFAS 159”) ~~Accounting~~which permits entities to choose to measure many financial instruments and certain other items at fair value that are not currently required to be measured at fair value. SFAS 159 will be effective for the ~~Stock~~Company ~~Options~~on January 1, 2008. The Company is currently evaluating the impact of adopting SFAS 159 on its financial position, cash flows, and results of operations.

~~The Company has adopted Statement of Financial Accounting Standards No. 123~~ (~~“SFAS No. 123”~~2), ~~“Accounting for Stock-Based Compensation,” which~~Presentation ~~establishes a fair value based method~~ of ~~accounting~~Interim ~~for~~Consolidated stock-based compensation. SFAS No. 123 encourages but does not require entities to adopt its provisions in place of the provisions of Accounting Principles Board Opinion No. 25 (“APB No. 25”), “Accounting for Stock Issued to Employees”. SFAS No. 123 permits entities to recognize the expense of all stock-based awards over the vesting period of the awards. The expense is calculated based on the fair value at the date of grant. Alternatively, APB No. 25 requires that the expense of stock-based employee compensation be recognized based on the difference, if any, between the quoted market price of the stock and the amount the employee must pay to acquire the stock. APB No. 25 specifies various dates to be used to determine the quoted market price, depending on whether the terms of the stock-based compensation award are fixed or variable. Under SFAS No. 123 if an entity elects to follow APB No. 25 it must provide pro forma net income (loss) disclosure for employee stock option grants made, as if the fair-value-based method defined in SFAS No. 123 had been applied. The Company has elected to apply the provisions of APB No. 25. Had the Company chosen to adopt the provisions of Statement of Financial Accounting Standards No. 123, as amended by SFAS No. 148 — “Accounting for Stock-Based Compensation — Transition and Disclosure,” and recognized compensation cost based upon the fair value of all options granted (including those granted at or above fair market value) at the date of grant, the Company’s net loss and net loss per share for the three months and nine months ended September 30, 2005 and 2004 would have been: Statements

	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
Amount in thousands, except per share data	2005			2004			2005			2004
Net loss, as reported	$	(3,908	)	$	(4,558	)	$	(10,310	)	$	(10,701	)
Add: Stock-based employee compensation expense
included in reported net loss		--			11			--			34
Deduct: Total stock-based compensation expense determined
under fair-value based method for all awards		(130	)		(496	)		(339	)		(1,524	)
Pro forma net loss	$	(4,038	)	$	(5,043	)	$	(10,649	)	$	(12,191	)
Net loss per share, basic and diluted:
As reported	$	(0.24	)	$	(0.28	)	$	(0.64	)	$	(0.65	)
Pro forma	$	(0.25	)	$	(0.31	)	$	(0.66	)	$	(0.74	)

The accompanying consolidated financial statements for the three and six months ended June 30, 2007 and 2006 are unaudited and have been prepared in accordance with accounting principles generally accepted in the United States of America, the instructions to this Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such consolidated financial statements include all adjustments (consisting of normal recurring accruals) considered necessary for the fair presentation of the financial position and the results of operations, and cash flows for these periods. As permitted under the applicable rules and regulations of the Securities and Exchange Commission, these consolidated financial statements do not include all disclosures and footnotes normally included with annual consolidated financial statements, and accordingly, should be read in conjunction with the consolidated financial statements, and the notes thereto, included in the Company’s 2006 Annual Report on Form 10-K/A filed with the SEC on April 10, 2007. The results of operations presented in the accompanying consolidated financial statements are not necessarily indicative of the results that may be expected for the year ending December 31, 2007.

6 The accompanying consolidated balance sheet as of December 31, 2006 is derived from the audited consolidated financial statements included in the Company’s 2006 Annual Report on Form 10-K/A filed with the SEC on April 10, 2007.

On August 8, 2005, the Company issued stock options for 907,500 shares to executive employees (other than the Company's Chief Executive, Chief Operating and Chief Financial Officer3) at anDiscontinued average exercise price of $6.50 per share in exchange for the termination of 432,000 shares at an average exercise price of $7.55 per share. The closing price of the Company's stock that day was $4.22 per share. The forfeited shares were fully vested and the new shares vest over three years. The exchange of shares represents an effective repricing and is therefore subject to variable compensation accounting. Since the exercise prices for the new shares are in excess of the closing price of the Company’s stock at September 30, 2005, no compensation expense has been recorded in the accompanying statement of operations. The incremental value of the new options in excess of the value of the forfeited shares at the new grant date is being amortized over the three-year expected life for purposes of the above pro forma calculations. Operations

As described in Note (1), the Company’s stations KUWB serving the Salt Lake City marketplace (sold on April 4, 2006), ~~Income~~WTVK ~~Taxes~~serving the Ft. Myers-Naples marketplace (sold on February 16, 2007) and WBUI serving the Champagne-Springfield-Decatur marketplace have been treated as discontinued operations. All interest expense has been allocated to discontinued operations since the combined proceeds of the Clear Channel Transaction, the Sun Transaction and the GoCom Transaction were, or will be, required to be used to pay down existing debt and exceed our outstanding debt for all periods. Selected operating results and balance sheet information related to these discontinued operations, in thousands, are as follows:

Prior to January 1, 2002, the Company recorded deferred tax liabilities relating to the difference in the book basis and tax basis of goodwill and intangibles. The future reversals of those deferred tax liabilities were utilized to support the realization of deferred tax assets (primarily consisting of net operating loss carryforwards) and the corresponding deferred tax benefits recorded by the Company. As a result of the adoption of SFAS No. 142, effective January 1, 2002 those deferred tax liabilities no longer reverse on a scheduled basis and can no longer be utilized to support the realization of deferred tax assets. 7

Operating results (5unaudited): ~~Notes Payable Under Revolving Credit Facility and Second-Lien Term Loan~~

The Company’s senior credit agreement permits maximum borrowings thereunder of $60.0 million, contains financial covenants, is secured by all the assets of the Company and matures in November 2008. The Company also has a $20.0 million Second-Lien Term Loan (“SLTL”) that matures in May 2009. The SLTL agreement contains covenants similar to those contained in the Company’s senior credit agreement.

	Three Months Ended June 30,						Six Months Ended June 30,
	2007			2006			2007			2006
Net revenues	$	673		$	2,683		$	2,167		$	6,958

Loss from operations, before gain on sale and
income tax expense		(873	)		(1,279	)		(3,183	)		(3,034	)
Gain (loss) on sale of assets		(7	)		5,907			27,906			5,907
Income tax expense		42			(98	)		(207	)		(197	)
Income (loss) from discontinued operations	$	(838	)	$	4,530		$	24,516		$	2,676

~~Costs~~Assets ~~associated~~held ~~with~~for ~~the~~sale: procuring or amending of the Company’s credit facilities, including loan fees and related professional fees, are included in long-term other assets and are amortized on a straight-line basis over the term, including amended terms, of the facilities. Amortization of these costs is recorded as interest expense and approximates the result of the effective interest method.

As of September 30, 2005, there was approximately $31.7 million outstanding under the revolving credit facility at an average interest rate of approximately 8.6% per annum and $20.0 million outstanding under the second-lien term loan agreement at an interest rate of approximately 10.9%. Approximately $19.3 million of additional borrowings were available under the revolving credit facility as of September 30, 2005.

	June 30, 2007		December 31, 2006
Programming rights	$	1,375	$	3,935
Property and equipment, net		2,215		4,796
Goodwill, net		--		1,863
Broadcast licenses, net		2,251		14,835
Assets held for sale	$	5,841	$	25,429

OnLiabilities ~~November~~held ~~7, 2005, the Company and its lenders amended both facility agreements. The amendments changed the minimum EBITDA covenant effective September 30, 2005~~ for the twelve months then ended and also imposed certain restrictions on the Company’s ability to repurchase its common stock until such time that the Company reaches certain dollar thresholds of station sales, including its pending Salt Lake City station sale.: ~~At September 30, 2005 the Company was in compliance with all covenants contained in both loan agreements.~~

The Company will not be in compliance with the minimum EBITDA covenants of the loan agreements beginning with the quarter ended December 31, 2005. Since such non-compliance would give the lenders the right to demand immediate repayment of the loans, the Company has classified the debt under both agreements as current liabilities at September 30, 2005.

	June 30, 2007		December 31, 2006
Programming liabilities	$	1,662	$	4,242
Deferred income taxes		--		2,320

Liabilities held for sale	$	1,662	$	6,562

(64) ~~Barter~~Acquisition ~~and~~of ~~Trade~~Interest ~~Transactions~~in The Daily Buzz, LLC

In ~~Revenue and~~March ~~expenses~~2007, ~~associated~~the ~~with~~Company ~~barter~~acquired ~~agreements~~the remaining 50% interest in ~~which~~The ~~broadcast~~Daily ~~time~~Buzz, isLLC ~~exchanged~~from Emmis for ~~programming~~ ~~rights~~$1 ~~are~~and ~~recorded~~became at the ~~estimated~~sole ~~average~~owner ~~rate~~ of the ~~airtime exchanged~~venture. ~~Barter~~ ~~revenue~~The ~~amounted~~transaction towas ~~$917,000~~treated as a step acquisition and ~~$871~~as of March 31,~~000~~ ~~during~~2007, the ~~three-month~~Company ~~periods~~reconsolidated ~~ended~~the venture’s ~~September~~balance ~~30,~~sheet ~~2005~~into ~~and~~its ~~2004,~~consolidated ~~respectively~~financial ~~and~~statements. ~~$2,821,000~~The ~~and~~fair ~~$2,790,000~~value ~~during~~of the ~~nine~~assets ~~month~~acquired ~~periods~~via ~~ended~~Emmis ~~September~~50% ~~30,~~interest ~~2005~~were ~~and~~approximately ~~2004~~$336,000 ~~respectively.~~and ~~Trade~~the ~~transactions,~~fair ~~which represent~~value of the liabilities ~~exchange~~assumed, including Emmis share of ~~advertising~~projected ~~time~~operating ~~for~~losses ~~goods~~through orAugust 31, ~~services~~2007, ~~are~~were $449,000. No goodwill was recorded atin this acquisition. As the operating ~~estimated~~results ~~fair~~of ~~value~~The Daily Buzz, LLC from the date of the ~~products~~acquisition orof ~~services~~Emmis’ ~~received~~interest through ~~based~~March on31, ~~comparable~~2007 ~~cash transactions.~~were ~~Barter~~not ~~and~~material, ~~trade~~the ~~revenue~~Company isused ~~recognized~~the ~~when~~equity ~~advertisements~~method ~~are~~of ~~broadcast.~~accounting ~~Merchandise~~to orreflect ~~services~~its ~~received~~share ~~from~~of ~~airtime~~the ~~trade~~venture’s ~~sales~~operating ~~are~~results ~~charged~~for tothe ~~expense~~entire orthree months ~~capitalized~~ended March 31, 2007 and ~~expensed~~effective ~~when~~April ~~used~~1, 2007 reconsolidated the operating results.

(75) ~~Sale~~Impairment of Long-lived ~~Construction~~Assets ~~Permit~~

OnDuring ~~April~~the 14first quarter ended March 31, ~~2005~~2007, the Company ~~concurrently~~determined ~~acquired~~that athe ~~construction~~long-lived ~~permit~~assets of ~~for~~station ~~the~~WBUI ~~Flint, Michigan~~were ~~marketplace~~impaired ~~for~~and recorded an impairment of $3850,000.0 ~~million~~Approximately $422,000 ~~and~~of ~~sold~~the ~~that~~impairment ~~construction~~was ~~permit~~allocated ~~for~~to broadcast licenses and $~~4.5~~428,000 ~~million~~to property and equipment. These impairment charges are included in results from discontinued ~~Net~~operations. ofNo ~~related~~impairment ~~expenses,~~of the Company’s ~~recorded~~long-lived aassets ~~gain~~was onincurred for the second ~~sale~~quarter ofended ~~approximately~~June $130, 2007.~~2 million.~~

(8~~) Loss Per Common Share~~

7(6) Stock-Based Compensation

~~The~~On ~~Company~~January ~~calculates~~1, ~~loss per~~2006, ~~share~~the inCompany ~~accordance~~adopted ~~with~~FASB Statement ~~of SFAS~~ No. ~~128~~ 123(R), ~~“Earnings~~ ~~Per~~ “Share-Based Payment”. (“SFAS ~~No. 128~~123(R)”) ~~requires~~using athe ~~presentation~~modified ofprospective ~~basic~~transition ~~earnings~~method. ~~per~~There ~~share~~were ~~(“EPS”)~~no ~~and~~stock ~~diluted~~options ~~EPS.~~granted ~~Basic~~or ~~EPS~~any ~~includes~~other notype ~~dilution~~of ~~and~~share-based issuances isduring ~~computed~~the bysix ~~dividing~~months ~~income~~ended ~~available~~June to30, ~~common~~2007. ~~stockholders~~For by the ~~weighted~~six ~~average~~months ended June 30, 2007 and ~~number~~2006, the adoption of ~~common~~SFAS ~~shares~~123(R) ~~outstanding~~resulted in stock-based compensation expense for continuing ~~the~~operations ~~period.~~of ~~Diluted~~$209,000 ~~EPS~~and ~~reflects~~$160,000, ~~the~~respectively. ~~potential~~Stock-based compensation ~~dilution~~expense ~~from~~for ~~securities~~discontinued ~~that~~operations ~~could~~was ~~share~~$7,000 inand $18,000 for the ~~earnings~~six ofmonths ~~the~~ended ~~Company~~June 30, 2007 and 2006, respectively. InAs ~~calculating diluted~~of ~~EPS~~June 30, no2007, ~~potential~~there ~~shares~~was $308,000 of ~~common~~total unrecognized ~~stock~~compensation ~~are~~cost related to beunvested ~~included~~share-based incompensation ~~the~~awards ~~computation~~granted ~~when~~under athe ~~loss~~equity ~~from~~compensation ~~continuing~~plans ~~operations~~which ~~available~~does tonot ~~common~~include ~~stockholders~~the ~~exists.~~effect ~~The~~of future grants of ~~statement~~equity ~~requires~~compensation, ~~dual~~if ~~presentation~~any. ofOf ~~basic~~the ~~and~~total ~~diluted~~$308,000, ~~EPS~~the byCompany ~~entities~~expects ~~with~~to ~~complex~~recognize ~~capital~~approximately ~~structures~~45% in the remaining interim periods of 2007, 51% in 2008 and 4% in 2009.

Stock options(7) outstandingIncome amounted to 2,471,446 shares at September 30, 2005 and 2,383,048 shares at September 30, 2004 and were not included in the computation of diluted EPS because an inclusion of such shares would have been anti-dilutive since there were net losses in all periods presented. Taxes

Prior to January 1, 2002, the Company recorded deferred tax liabilities relating to the difference in the book basis and tax basis of goodwill and intangibles. The future reversals of those deferred tax liabilities are utilized to support the realization of deferred tax assets (9primarily consisting of net operating loss carryforwards) ~~Recent~~and ~~Accounting~~the corresponding ~~Pronouncement~~deferred tax benefits recorded by the Company. As a result of the adoption of SFAS No. 142, effective January 1, 2002 those deferred tax liabilities no longer reverse on a scheduled basis and can no longer be utilized to support the realization of deferred tax assets.

Tax ~~In December 2004,~~expense ~~the~~for ~~FASB~~continuing ~~issued~~operations ~~Statement~~included ofa ~~Financial~~current ~~Accounting~~tax ~~Standards (“SFAS”)~~benefit ~~No. 123(R)~~of $694,000 ~~Share-Based~~for ~~Payments~~the ~~(“SFAS 123(R)”),~~six ~~which~~months ~~requires~~ended ~~companies~~June to30, ~~measure~~2007 and ~~recognize~~deferred ~~compensation~~tax expense ~~for~~of ~~all~~$733,000 ~~stock-based payments at fair value. SFAS 123(R) was to be effective~~ for ~~all~~the ~~interim~~six ~~periods~~months ~~beginning~~ended ~~after~~ June ~~15,~~ ~~2005; however~~30, on2007 ~~April 14,~~relating ~~2005,~~to the ~~Securities~~difference between book and ~~Exchange Commission~~tax ~~changed~~amortization ~~the~~of ~~effective~~intangibles described ~~date~~above. toThe ~~fiscal~~current ~~years~~benefit ~~that~~was ~~begin~~calculated ~~after~~at ~~June 15,~~the ~~2005. Therefore,~~combined ~~SFAS~~federal ~~123(R)~~and ~~will~~average state bestatutory ~~effective~~rate ~~for~~since usit onis ~~January 1,~~expected ~~2006.~~to ~~The~~be ~~Company~~fully ~~is currently~~realized ~~evaluating~~by the ~~impact~~tax ~~of SFAS 123(R)~~ on ~~its~~the ~~financial~~gain ~~position and results of~~on discontinued operations.

~~(10)~~ Income tax ~~Discontinued~~expense ~~Operations~~for discontinued operations for the six months ended June 30, 2007 included a current tax expense of $2.5 million representing an estimate for current alternative minimum taxes resulting from the gain on the Sun Transaction and ordinary tax in the amount of the full-year expected tax benefit for continued operations, and a deferred tax benefit of $2.3 million representing the reversal of the deferred tax liability at December 31, 2006 relating to the cumulative difference between the book and tax amortization of intangibles for the station sold.

On August 8, 2005, the Company reached an agreement to sell KUWB, its Salt Lake City station, to units of Clear Channel Communications, Inc (“Clear Channel”8) forNotes $18.5Payable millionUnder in anRevolving assetCredit sale.Facility Consummation of the transaction is contingent on Clear Channel selling a radio station it owns in the Salt Lake City market and subjectSecond-Lien toTerm approval by the Federal Communications Commission. If our transaction with Clear Channel hasn’t closed by April 8, 2006, either party can terminate the KUWB sale agreement. The Company believes it is highly probable that the sale of the station will be consummated within the coming year and, accordingly, has treated the station’s results of operations for all periods presented in the accompanying financial statements as discontinued operations. Loan

On ~~KUWB’s~~March ~~net~~29, ~~revenue for~~2006, the ~~three~~Company ~~months~~restructured ~~and~~its ~~nine~~debt ~~months~~agreements, ~~ended~~amending ~~September~~its 30revolving credit facility (the “Revolver”) to (a) eliminate all financial covenants, ~~2005~~(b) reset ~~was~~maximum borrowings under the agreement to the lesser of $~~1,667,000~~60 million or 50% of the aggregate appraised STAC (start-up station with an affiliation contract) values of the station group and (c) allow for an immediate borrowing of $10 million to reduce the SLTL outstanding borrowings from $520 million to $10 million. The amendment also provided that,~~048~~ upon the completion of the Clear Channel Transaction,~~000~~ the maturity date of the Revolver would be extended to May 2009, ~~respectively.~~the ~~Its~~Company ~~net~~would ~~revenue~~be ~~for~~allowed to repurchase up to $20 million of its common stock and would also be required to repay the ~~three~~remaining $10 million ~~months~~outstanding under the SLTL agreement and ~~nine~~terminate ~~months~~the ~~ended~~SLTL ~~September~~from ~~30,~~the ~~2004~~proceeds of that transaction. The SLTL credit agreement was ~~$1,897,000~~amended to (a) eliminate financial covenants and $5(b) reduce the amount of the prepayment penalty under the agreement. On April 4,~~698,000,~~ 2006 ~~respectively~~the Company completed the Clear Channel Transaction and used the proceeds from the sale to pay off and terminate the SLTL and reduce outstanding borrowings under the revolver.

~~Assets~~On ~~held~~February ~~for sale at September 30~~16, ~~2005 consist principally of KUWB’s programming rights of $8~~2007,~~311,000,~~ ~~property~~the ~~and~~Company ~~equipment,~~completed ~~net,~~the ofSun ~~$2,124,000~~Transaction and ~~intangible~~used ~~assets~~the ofproceeds to ~~$9,960,000.~~completely ~~Liabilities~~repay ~~held~~all ~~for~~borrowings ~~sale~~and ataccrued ~~September~~interest ~~30,~~then ~~2005~~outstanding ~~consist~~under ofthe ~~KUWB’s programming rights payable of $8,542,000~~revolver.

Costs associated with the procuring or amendment of the Company’s credit facilities, including loan fees and related professional fees, are included in long-term other assets and are amortized on a straight-line basis over the term, including amended terms, of the facilities. Amortization of these costs is recorded as interest expense and approximates the result of the effective interest method. In connection with the $10.0 million payments on the SLTL on March 29, 2006 and April 4, 2006, the Company amortized half of the then remaining unamortized prepaid financing costs relating to the SLTL. Upon the completion of the Sun Transaction and our repayment of the outstanding balance, our availability under our Revolver was reduced due to the reduction in the lenders’ collateral and the Company wrote-off $588,000 in prepaid financing costs, which approximates the proportionate amount of such costs, and charged such expense to discontinued operations. In May 2007, the Company unilaterally reduced its borrowing availability under the Revolver from $39.9 million to $17.7 million and wrote-off $570,000 in prepaid financing costs, which approximates the proportionate amount of the remaining costs at that date.

As of June 30, 2007, there was approximately $2.4 million outstanding under the Revolver at an average interest rate of 8.11% per annum. Also, since the debt under the Revolver of $2.4 million as of June 30, 2007 is required to be repaid with the proceeds from the GoCom Transaction, it has been classified as a current liability.

(9) Barter and Trade Transactions

Revenue and expenses associated with barter agreements in which broadcast time is exchanged for programming rights are recorded at the estimated average rate of the airtime exchanged. Barter revenue amounted to $782,000 and $805,000 during the three-month periods ended June 30, 2007 and 2006, respectively, and $1,478,000 and $1,598,000 for the six months ended June 30, 2007 and 2006, respectively. Trade transactions, which represent the exchange of advertising time for goods or services, are recorded at the estimated fair value of the products or services received based on comparable cash transactions. Barter and trade revenue is recognized when advertisements are broadcast. Merchandise or services received from airtime trade sales are charged to expense or capitalized and expensed when used.

The Company calculates income (loss) per share in accordance with SFAS No. 128, “Earnings Per Share”. SFAS No. 128 requires a presentation of basic earnings per share (“EPS”) and diluted EPS. Basic EPS includes no dilution and is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution from securities that could share in the earnings of the Company. In calculating diluted EPS, no potential shares of common stock are to be included in the computation when a loss from continuing operations available to common stockholders exists. The statement requires dual presentation of basic and diluted EPS by entities with complex capital structures.

Stock options outstanding amounted to 2,454,096 shares at June 30, 2007 and 2,460,096 shares at June 30, 2006 and were not included in the computation of diluted EPS because an inclusion of such shares would have been anti-dilutive.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

~~Forward~~ The following discussion should be read in conjunction with the Company’s consolidated financial statements and related notes included elsewhere in this report on Form 10-~~looking~~Q. ~~Statements~~

This Quarterly Report on Form 10-Q includes forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “could,” “likely”, “expect,” “believe” or “hopeful” or the negative of such terms or other comparable terminology. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our and the television broadcast industry’s actual results, levels of activity, performance, achievements and prospects to be materially different from those expressed or implied by such forward-looking statements. These risks, uncertainties and other factors include those identified in our 2004 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 16, 2005.

We are under no duty to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this Quarterly Report on Form 10-Q. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this Quarterly Report on Form 10-Q might not occur.

The following discussion should be read in conjunction with the Company’s consolidated financial statements and related notes included elsewhere in this report on Form 10-Q.

Overview

OnOur ~~August~~continuing 8,stations ~~2005,~~are weregionally ~~entered~~diverse ~~into~~and arange ~~transaction~~in tosize ~~sell~~(based ~~our~~on ~~station~~television households) ~~KUWB~~from ~~serving~~the 45th through the ~~Salt Lake~~85th ~~City~~largest ~~marketplace~~television ~~and,~~markets in ~~accordance~~the ~~with U~~nation.S. ~~generally accepted accounting~~All ~~principles,~~but ~~our~~one ~~statements~~ of ~~operations~~our ~~and~~stations ~~cash~~are ~~flows~~affiliates ~~reflect~~of the ~~results~~CW ofTelevision ~~this~~Network (“The CW”). Our second station asin ~~discontinued~~the ~~operations~~Albuquerque ~~for~~– ~~all~~Santa ~~periods~~Fe ~~presented~~marketplace is a MyNetworkTV affiliate.

Our continuing television stations are regionally diverse and range in size (based on television households) from the 47th through the 85th largest markets in the nation. All but one of our stations are affiliates of The WB Television Network. Our second station in the Albuquerque – Santa Fe marketplace is a UPN affiliate.

We derive revenues primarily from the sale of advertising time to local, regional and national advertisers. Our revenues depend on popular programming that attracts audiences in the demographic groups targeted by advertisers, allowing us to sell advertising time at satisfactory rates. Our revenues also depend significantly on factors such as the national and local economy and the level of local competition.

~~Our~~We operate in a mildly cyclical business where revenues are generally highest during the fourth quarter of each year, primarily due to increased expenditures by advertisers in anticipation of holiday season consumer spending and an increase in viewership during this period. We generally pay commissions to advertising agencies on local, regional and national advertising and to national sales representatives on national advertising. Our revenues reflect deductions from gross revenues for commissions payable to advertising agencies and national sales representatives.

Our primary ongoing operating expenses are costs of services, selling, general and administrative expenses, corporate expenses, ~~and~~ depreciation and amortization and expenses related to impairments in our broadcast licenses. Costs of services include programming costs, which consist primarily of amortization of broadcast rights relating to syndicated programs as well as costs associated with ~~the production of~~ our morning news show, The Daily Buzz (which, ~~music~~as ~~rights~~of ~~fees~~January 1, 2004, became jointly produced by us and ~~network~~Emmis ~~compensation~~and then, beginning ~~expense~~July 1, 2006 was deconsolidated and as of June 30, 2007 was reconsolidated) and music rights fees. Other costs of service include advertising expenses, targeted at viewers, ~~which~~ ~~are~~which is net of any reimbursement received or due to us for such advertising and promotion ~~from~~ ~~The~~from WBour ~~Network,~~networks ~~UPN~~ or from other program suppliers, and engineering and transmission related expenses. Selling, general and administrative expenses primarily include salaries, sales commissions to account executives, ratings ~~services~~service expenses, insurance and various related overhead expenses. Corporate expenses reflect costs of corporate management, which includes senior management and other centralized management support staff, along with investor relations ~~expense~~expenses, professional fees, directors and officers insurance and other related corporate overhead.

The first eleven months of 2004 included significant political advertising demand in certain of our markets. We do not directly benefit from such political spending, but the increased demand for commercial inventory generally had a positive effect on our ability to increase pricing and market share of non-political advertising expenditures. In 2005, with no material political advertising demand in our markets, most affiliates of the ABC, CBS and NBC networks, who were the primary beneficiaries of this advertising in 2004, have been competing aggressively to recapture non-political advertising dollars. We believe this aggressive competition will likely continue through November 2005. In addition to this competitive factor, national advertising demand during the third quarter and first nine months 2005 has been very weak. In comparison, non-political local advertising demand in our markets, excluding Salt Lake City, has been relatively healthy, growing approximately 8% for both the third quarter and first nine months of 2005 compared to the corresponding periods of 2004. 10

Our ~~All but~~business ~~one~~is ofincreasingly ~~our~~affected ~~stations~~by ~~are~~robust WBpolitical ~~Network~~spending ~~affiliates~~in the even, biennial years. ~~The~~Because WBwe ~~Network~~have ~~has~~limited ~~experienced~~news ~~ratings declines~~product ~~over~~and ~~the~~appeal ~~past~~to ~~two~~a ~~seasons~~generally younger demographic than ABC, CBS and ~~several~~NBC ofaffiliates, ~~our~~we ~~seven~~do WBnot ~~affiliated~~benefit ~~stations~~materially ~~have suffered~~like ~~declines~~those inaffiliates ~~ratings~~do from ~~and~~strong ~~viewership~~political asadvertising ain ~~result~~our markets. ~~These~~However, ~~declines~~we ~~have~~do abenefit ~~direct~~indirectly when ~~effect~~heavy onpolitical spending limits our ~~ability~~competitors’ tocommercial ~~generate~~inventory ~~advertiser~~and ~~revenue.~~our stations Weusually ~~are~~end ~~encouraged~~up byincreasing ~~the~~their ~~quality~~share of ~~The~~ ~~WB’s~~non-political ~~new~~business ~~programs~~during ~~this~~these times. ~~fall~~Apart ~~and~~from ~~remain~~possible ~~hopeful~~early ~~the~~political ~~network~~advertising ~~will~~for ~~return~~the to2008 apresidential election, ~~positive~~we ~~ratings~~do ~~trend~~not ~~this~~expect ~~season.~~2007 ~~Also,~~to ~~the~~see WBsignificant ~~will~~political ~~reprogram~~spending ~~weekday~~and ~~afternoons~~there ~~starting~~was limited inpolitical ~~January~~spending ~~2006~~during ~~with~~the ~~shows~~first ~~targeting~~six ~~adult~~months ~~demographics.~~of ~~The~~2007 ~~Kids~~in ~~WB!~~our ~~block~~continuing ~~has~~markets. ~~become a~~During ~~drag~~the onfirst ~~station~~six ~~revenue~~months ~~and~~of ~~ratings~~2007, asnon-political ~~the~~advertising ~~cable~~spending ~~networks~~in ~~have~~our ~~taken~~continuing ~~control~~markets was ofdown, ~~that business.~~on Wea ~~believe~~weighted-average ~~the~~basis, ~~new~~approximately ~~schedule~~2% ~~represents~~compared ato ~~growth~~the ~~opportunity~~first ~~for~~six ~~ACME~~months of 2006.

AsIn ~~disclosed~~January ~~previously~~2006, ~~the~~CBS, ~~Company~~Inc. ~~believes~~and itWarner ~~will~~Bros. ~~more~~Entertainment, ~~likely~~Inc. announced they would be shutting adown ~~seller~~their ~~than~~UPN ~~buyer~~and ~~in future~~WB ~~television~~Television ~~station~~Networks ~~transactions.~~operations ~~There~~in ~~has~~September ~~been~~2006 and then launching a ~~marked~~jointly-owned ~~increase~~new ~~over~~network, ~~the~~The ~~past several~~CW. ~~months~~All of ~~television~~our ~~station~~then ~~sales~~continuing atWB ~~valuations~~affiliated stations inentered ~~excess~~into ofaffiliation ~~implied~~agreements ~~public market~~with ~~values~~The CW. WeSince ~~are~~the ~~cautiously~~CW ~~optimistic~~launched ~~that~~with ~~this~~a combination ~~improving~~of ~~transaction~~the ~~environment will~~strongest ~~generate~~performing ~~new~~shows from UPN and ~~renewed~~The ~~interest~~WB, init ~~further~~was ~~transactions~~expected ~~and~~that The weCW ~~continue~~would toachieve ~~discuss possible~~higher ~~transactions~~ratings ~~with~~when ~~potential~~it ~~buyers~~launched ofthan ~~our~~either ~~stations.~~UPN or The ~~sale~~WB ofhad ~~our~~been achieving ~~Salt~~in ~~Lake City~~recent ~~station~~years. However, ~~while~~contrary ~~contingent~~to onmost expectations, the ~~buyer~~network ~~selling~~experienced a ~~one~~slow ofstart, ~~its~~primarily ~~radio~~we ~~stations~~believe, indue ~~the market~~to ~~and~~viewer ~~subject~~confusion toabout ~~approval~~where byto ~~the~~find ~~Federal~~their previous ~~Communications~~favorite ~~Commission~~shows, ismany ~~expected~~of towhich ~~be completed~~had ~~either~~changed stations in ~~the~~their ~~first~~markets. orOur ~~second~~lone ~~quarter~~UPN affiliate, ofstation ~~2006.~~KASY ~~Under~~serving the ~~terms~~Albuquerque-Santa ofFe amarketplace, ~~shared~~entered into an ~~services~~affiliation agreement with ~~Clear Channel~~MyNetworkTV, ita isnew ~~required~~network toof ~~reimburse~~Newscorp’s ~~the~~Fox subsidiary, ~~Company~~which ~~for~~also ~~the station~~launched in September 2006. MyNetworkTV’s ~~operating~~initial programming ~~losses,~~lineup ~~excluding~~consisted ~~depreciation~~of ~~and~~two ~~certain~~one-hour ~~other~~telenovelas ~~items,~~airing upMonday tothrough aSaturday, ~~maximum~~but ~~amount~~audience acceptance of ~~$60,000~~these ~~per~~new ~~month~~shows ~~until~~was ~~closing~~considerably lower than expected. This had an adverse effect on KASY which saw a double digit percentage decline in net revenues compared to the first half of 2006.

The Company has been and continues to seek to monetize shareholder value by selling station assets. We sold two stations, KPLR in St. Louis and KWBP in Portland, to The Tribune Company in March 2003. We sold KUWB in Salt Lake City to Clear Channel in April 2006. In February 2007, we sold our station WTVK serving the Ft. Myers-Naples, Florida market to Sun Broadcasting. In June 2007, we announced that we had entered into an agreement with GoCom Media of Illinois for the sale of our station WBUI serving the Champaign-Springfield-Decatur marketplace. We expect that transaction to be completed by the end of calendar 2007, although completion of the transaction is subject to the approval of the FCC and other customary closing conditions. We have continued to evaluate opportunities to sell our remaining stations, but given the potentially limited number of buyers for our types of stations, we intend to be disciplined in those efforts.

Results of Operations

The Three Months Ended SeptemberJune 30, 20052007 vs.Compared Septemberto June 30, 20042006

Net revenues ~~increased~~from 7%continuing tooperations ~~$10.1 million~~ for the ~~third~~second quarter ~~ended~~decreased ~~September~~4% ~~30,~~to ~~2005~~$8.3 million compared to net revenues of $98.4 7 million ~~for~~in the ~~same~~second ~~period~~quarter aof ~~year ago~~2006. ~~This~~Our ~~increase~~net ~~reflects~~revenues from our continuing six stations decreased 6%, reflecting a ~~near~~ ~~186~~3% ~~increase~~decline in non-political advertising revenues ~~related~~in toour market revenues and a 3% decline in our share of those revenues. The ~~Daily~~revenue ~~Buzz~~decline ~~weekday~~at ~~morning~~our ~~news show~~stations ~~and~~was moderated somewhat by a 427% increase in net revenues at ~~our~~The ~~station~~Daily ~~group~~Buzz, driven by higher advertising revenues.

9 Programming costs decreased 4% to $3.2 million in the second quarter of 2007 from $3.3 million in the second quarter of 2006. The decrease was primarily attributable to lower write downs of program costs to reflect adjustments to net realizable value in the second quarter of 2007 compared to the second quarter of 2006.

Other Programming expenses increased 8% to $4.2 million for the third quarter of 2005 compared to $3.9 million for the third quarter of 2004 due primarily to the impact of the fall 2004 season syndicated launch of Malcolm in the Middle and to an increase in news costs ~~at The Daily Buzz compared to the third quarter~~ of ~~2004. Other costs of~~ service ~~increased~~decreased 72% to $1.53 million ~~compared~~ toin ~~$1.4 million for~~ the ~~third~~second quarter of ~~2004~~2007 ~~due~~from ~~principally to higher utility and property tax costs related to our Madison station’s new transmission facilities completed last fall. Selling, general and administrative costs increased 5% to~~ $41.03 million ~~compared~~in to the ~~prior~~second ~~year’s third~~ quarter ~~expense~~ of ~~$3.8~~2006 ~~million~~ primarily on ~~higher~~due ~~compensation~~to ~~expense~~slightly ~~and~~lower ~~ratings~~engineering ~~service~~and promotion costs.

~~Depreciation~~Selling, general and ~~amortization~~administrative costs for the ~~third~~second quarter ~~increased~~of 102007 decreased 2% to $1.2 .9 million, compared to $13.1 0 million in the ~~third~~second quarter of ~~2004.~~2006 ~~This increase~~ primarily ~~reflects~~due ~~new depreciation expense on the Madison transmission facility build-out and the upgrade~~ to lower ~~HDTV~~sales ofincentive ~~three of our stations in 2004~~expenses.

Depreciation ~~Corporate expenses~~and amortization decreased 713% to $~~887~~807,000 ~~for~~in the ~~third~~second quarter of ~~2005~~2007 asfrom ~~compared to~~ $~~949~~924,000 ~~for~~ for the ~~third~~second quarter of ~~2004.~~2006 ~~This~~due ~~decrease~~to ~~primarily~~more ~~reflects~~assets ~~reduced~~becoming ~~professional~~fully ~~fees that~~depreciated ~~were~~compared ~~lower~~to innew assets ~~our~~placed ~~second~~in ~~year~~service ofover ~~compliance with Section 404 provisions of~~ the ~~Sarbanes~~ ~~Oxley~~past ~~Act and lower insurance costs~~year.

Corporate ~~Interest expense,~~expenses ~~net~~for ofthe ~~interest~~second ~~expense~~quarter ~~allocated~~of to2007 ~~discontinued operations,~~ increased ~~100~~14% to $~~946,000~~1.0 ~~in the~~million ~~third quarter of 2005~~ compared to $~~472~~920,000 in in the ~~third~~second quarter of ~~2004.~~2006 ~~This~~due ~~increase~~principally ~~reflects~~to ~~our~~death ~~higher~~benefits ~~debt~~awarded ~~balances~~to ~~during~~an ~~the~~executive ~~third~~who ~~quarter~~passed ofaway ~~2005~~in ~~compared~~May 2007 and to ~~the~~costs ~~third~~associated ~~quarter~~with ~~2004~~the ~~and~~June ~~higher~~2007 ~~average~~closure ~~borrowing~~of our ~~rates~~corporate graphics department.

WeOur ~~recorded~~second aquarter of 2007 tax expense for continuing operations was $43,000 compared to a tax expense of $~~563~~258,000 ~~during~~for the ~~third~~second quarter of ~~2005,~~ ~~including~~2006. aThe ~~deferred~~significant ~~tax~~reduction in tax expense offor ~~$512,000,~~the ~~compared~~quarter tois arelated ~~tax~~to ~~expense~~the utilization of ~~$814,000~~ an offsetting benefit in 2007 against the ~~corresponding~~tax ~~quarter~~on ofour ~~2004.~~income ~~This~~from ~~deferred~~discontinued ~~tax~~operations, ~~expense~~net ~~relates~~of to the deferred tax ~~liabilities~~ associated with the amortization ~~for tax purposes~~ of our intangible assets for tax purposes.

Minority interest income, which relates to our The Daily Buzz joint venture with Emmis Communications, decreased to $149,000 in the third quarter of 2005 from $264,000 in the third quarter of 2004 due to the venture’s reduced net losses on higher station licensing revenue. 11

Our loss from discontinued operations, ~~which~~net ~~reflects~~of ~~the~~tax, ~~losses~~for ~~from~~the ~~our~~second ~~station~~quarter inof ~~Salt~~2007 ~~Lake City~~was ~~and~~$838,000 ~~allocated~~compared ~~interest~~to income ~~expense,~~of ~~was~~ $~~952,000~~4.5 million for the ~~third~~second quarter of ~~2005~~2006. ~~compared~~The toloss ~~$1.5~~in ~~million~~the second quarter ~~for~~of 2007 reflects the ~~third quarter~~operations of ~~2004,~~our ~~which~~Decatur ~~included~~station aand ~~$607,000~~interest ~~write-down~~expense inwhile ~~program rights,~~the ~~principally~~income ~~related~~in tothe ~~The~~second ~~Drew~~quarter ~~Carey~~of ~~Show.~~2006 Inreflects the ~~third~~gain ~~quarter~~on ofthe ~~2004~~sale weof ~~also incurred~~our anSalt ~~additional~~Lake ~~$411,000~~City station inand ~~tax~~income ~~expense~~from ~~related~~our toFt. ~~the~~Myers ~~2003~~station ~~sale~~net of losses at our ~~St.~~Decatur ~~Louis~~ station and interest ~~Portland stations~~expense.

Our netThe lossSix forMonths theEnded thirdJune quarter30, of2007 2005Compared was $3.9 million compared to aJune net30, loss of $4.6 million for the third quarter of 2004. 2006

~~The~~ Net revenues ~~Nine~~from ~~Months~~continuing ~~Ended~~operations ~~September~~for the six months ended June 30, ~~2005~~2007 vsdecreased 7% to $15.6 ~~September~~million compared to net revenues of $16.7 million for the six months ended June 30, 2006. ~~2004~~Our net revenues from our continuing six stations decreased 5% reflecting the 2% decline in non-political advertising revenues in our market revenues coupled with a 2% decline in our share of those revenues. The Daily Buzz was included in our consolidated results for the first six months of 2006 but deconsolidated from July 1, 2006 to March 31, 2007 and therefore only included in our second quarter 2007 consolidated results.

~~Net~~Programming ~~revenues~~costs ~~increased~~decreased 519% to $305.4 5 million ~~for~~in the first ~~nine~~six months of ~~2005~~2007 ~~compared~~from to $286.9 8 million ~~for~~ in the ~~same~~first ~~period~~six amonths ~~year~~of ~~ago~~2006. ~~This~~The ~~increase~~decrease ~~reflects~~was ~~the~~primarily ~~strong~~attributable to the ~~performance~~aforementioned deconsolidation of ~~The~~the Daily Buzz, which ~~increased~~incurred ~~its~~$998,000 ~~revenues~~in ~~during~~programming costs in the ~~period~~second ~~296%~~ quarter of 2007 compared to ~~the~~$1.7 ~~first~~million ~~nine~~for the six months ofended ~~2004~~June 30, ~~and~~2006. aWe 2%also ~~increase~~incurred at$195,000 ~~our~~lower ~~station~~write ~~group~~downs ~~net~~of program costs in the first six ~~revenues~~months of 2007 compared to the same period for 2006.

~~Programming~~Other expenses increased 9% to $12.4 million compared to $11.4 million for the first nine months of 2004 due primarily to the impact of the fall 2004 season syndicated launch of Malcolm in the Middle and a $441,000 increase in production costs ~~related to The Daily Buzz. Other costs~~ of service increased 8% to $4.9 million for the first nine months of 2005 compared to $4.5 million for the corresponding nine-month period a year ago primarily due to increased engineering costs related to higher repairs and maintenance and to our new transmission facility in Madison completed in September 2004. Selling, general and administrative costs were ~~essentially~~basically unchanged at $112.65 million for both the first ~~nine~~ six months of 2007 ~~2005~~and ~~compared to $11~~2006.7 ~~million for the year earlier period.~~

Selling, ~~Depreciation~~ general and ~~amortization~~administrative costs for the ~~nine~~first six months ~~ended~~of ~~September~~2007 ~~30,~~declined ~~2005 increased 8~~2% to $3.5 .8 million, compared to $36.3 0 million ~~for~~in the ~~nine~~six months ~~ended~~quarter ~~September~~of ~~30, 2004.~~2006 ~~This~~primarily ~~increase~~due ~~reflects~~to slightly ~~new~~lower ~~depreciation~~sales ~~expense~~commissions ~~on the new Madison facilities~~ and ~~the~~ ~~significant~~sales ~~digital~~incentive ~~transmission related equipment placed into service during 2004~~expenses.

Depreciation ~~Corporate expenses~~and amortization decreased 914% to $21.56 million for the first ~~nine~~six months of ~~2005~~2007 asfrom ~~compared to~~ $21.8 9 million for the first ~~nine~~six months of ~~2004.~~2006 ~~This~~due ~~decrease~~to ~~primarily~~more ~~reflects~~assets ~~reduced insurance~~becoming ~~costs~~fully ~~and~~depreciated compared ~~professional~~to ~~fees~~new ~~that~~assets ~~were~~placed ~~lower~~ in ~~our~~service ~~second~~over ~~year of compliance with Section 404 provisions of~~ the ~~Sarbanes~~past ~~Oxley Act~~year.

10 Corporate expenses for the first six months of 2007 increased 5% to $1.9 million compared to $1.8 million for the first six months of 2006 due primarily to death benefits awarded in the second quarter of 2007 to one of the Company’s executives and to costs associated with the closure of our corporate graphics department, which were partially offset by reduced professional fees and insurance costs.

In ~~April~~March ~~2005~~2007, we ~~simultaneously~~ acquired ~~and~~our ~~then~~joint ~~sold~~venture apartner’s ~~construction~~50% ~~permit~~interest in ~~the~~The ~~Flint~~Daily Buzz, ~~Michigan~~LLC ~~marketplace~~ and ~~recognized~~have areconsolidated that venture’s balance sheet as of June 30, 2007. We recorded our share of the joint venture’s net ~~gain~~loss, on$251,000, for first quarter of 2007 using the ~~sale~~equity method of $1accounting.2 ~~million~~In the second quarter of 2007, we included the company’s results in our consolidated financial statements. In the first six months of 2006, we included the joint venture’s results in our consolidated financial statements and recorded our partner’s share of the net loss, $463,000, as minority interest income.

~~Interest~~Our first ~~expense,~~six ~~net~~months of ~~interest expense~~2007 ~~allocated~~tax toexpense ~~discontinued~~for continuing operations, ~~increased~~was ~~119%~~$79,000 compared to ~~$2.5~~a tax ~~million~~expense of $898,000 for the ~~nine months~~first ~~ended~~six ~~September~~months ~~30,~~of ~~2005~~2006. ~~compared~~This tosignificant ~~$1.1 million~~reduction ~~for~~in tax ~~the~~expense ~~nine~~is ~~months~~related ~~ended September~~to ~~30,~~the ~~2004.~~utilization ~~This~~of ~~increase~~an ~~reflects~~offsetting ~~our~~benefit ~~higher~~in ~~debt~~2007 ~~balances~~against ~~and~~the ~~higher average~~tax ~~borrowing~~on ~~rates~~our ~~during~~income ~~the~~from ~~first~~discontinued ~~nine~~operations, ~~months~~net of ~~2005~~the ~~compared~~deferred totax ~~the~~associated ~~corresponding~~with ~~period~~the amortization of ~~2004~~our intangible assets for tax purposes.

WeOur ~~recorded~~income ~~tax~~from ~~expense~~discontinued operations, net of tax, for ~~continuing~~the ~~operations~~first six months of 2007 was $124.5 million compared to $2.7 million ~~during~~in income from discontinued operations for the first ~~nine~~six months of ~~2005~~2006. ~~compared~~Our income in 2007 includes the gain on the Sun Transaction of $27.9 million and income from station WTVK for the approximate 46 days we owned the station up to ~~tax~~the closing, net of interest expense. The income in 2006 reflects the gain on the Clear Channel transaction of $15.9 million and the operating income from station WTVK, net of higher interest expense on higher outstanding debt. Also included in income is tax expense of $207,000 and $197,000 for the ~~corresponding~~first ~~nine~~six months of ~~2004~~2007 and 2006, respectively.

Our loss from discontinued operations before taxes, which reflects the losses from our station in Salt Lake City, including allocated interest expense, was essentially unchanged at $3.2 million for both the nine months of 2005 and 2004. Also included in our 2004 discontinued operating results is $411,000 in tax expense related to the 2003 sale of our St. Louis and Portland stations.

Our net loss for the first nine months of 2005 was $10.3 million compared to a net loss of $10.7 million for the first nine months of 2004.

Liquidity and Capital Resources

Cash flow used by operating activities was $~~3.6~~763,000 ~~million~~ for the ~~nine~~six months ended ~~September~~June 30, ~~2005~~ 2007 compared to cash flow used by operating activities of $1.05 million for the first ~~nine~~ six months of ~~2004~~2006. This ~~increase~~ decrease in cash flow usage of $~~2.6~~735,000 ~~million~~ relates primarily to ~~increased~~a decrease ~~cash~~in ~~interest~~working capital needs and the fact that the first three months of operations ~~payments,~~for ~~reduced~~The ~~station~~Daily Buzz had no impact on operating ~~results~~cash flow since it was accounted for during that period using the equity accounting method and ~~higher~~therefore ~~working~~for ~~capital~~that ~~usage~~quarter was included in investing activity.

Cash flow used in investing activities during the first nine months of 2005 was $45,000 compared to $5.6 million used during the first nine months of 2004. This reduced usage reflects the $1.7 million in proceeds from the sale of our Flint construction permit and related fixed assets in April 2005, and a $3.6 million decrease in capital expenditures for the nine months ended September 30, 2005 compared to the nine months ended September 30, 2004. The 2004 period usage also included the additional purchase consideration for a full-power satellite station in the Albuquerque-Santa Fe market acquired in the first quarter of 2004. 12

Cash flow provided by ~~financing~~investing activities ~~was $7.2 million~~ during the first ~~nine~~six months of ~~2005~~2007 was $42.7 million compared to ~~$9.1~~cash ~~million~~flow provided by ~~financing~~investing activities ~~for~~of $19.3 during the first ~~nine~~ six months of ~~2004~~2006. The ~~reduction~~2007 incash ~~these~~flow ~~cash~~includes ~~flows~~$44.0 ~~relates~~million ~~primarily~~in tonet ~~the~~proceeds ~~reduced~~from ~~funding~~the Sun ~~related~~Transaction, tonet ~~our~~of ~~lower~~$1.1 million in capital expenditures ~~net~~related to new commercial playback systems at all of ~~additional~~our ~~funding~~stations ~~for~~and ~~operating~~our ~~losses~~Daily Buzz facility move. The 2006 cash flow included $18.4 million in net proceeds from the Clear Channel Transaction and ~~interest~~$1.1 million ~~payments~~from the sale of our CarSoup investment, net of $226,000 in capital expenditures.

Cash ~~Our revolving~~flow ~~credit~~used ~~agreement~~in ~~and~~financing ~~second-lien~~activities ~~term~~was ~~loan~~approximately ~~agreement~~$42.2 million ~~mature~~during onthe ~~November~~first six 8,months ~~2008 and~~of ~~May~~2007 8,as ~~2009,~~we ~~respectively.~~repaid Onall ~~March~~of ~~10,~~the ~~2005,~~then wecurrent ~~amended~~outstanding ~~certain~~debt ofunder ~~the~~our ~~quarterly~~senior ~~financial~~credit ~~covenants~~facility ~~for~~on ~~calendar~~the ~~2005~~completion inof ~~both~~the ~~agreements.~~Sun WeTransaction ~~did~~but ~~not~~subsequently ~~amend~~reborrowed ~~these covenants~~$2.4 ~~for~~million ~~2006~~to orpartially ~~beyond.~~fund Onour ~~November~~$8.0 7,million ~~2005,~~dividend ~~our~~payment ~~lenders~~made ~~again~~in ~~amended~~March ~~our~~2007 ~~minimum~~and ~~EBITDA~~to fund ~~(earnings~~ongoing ~~before~~working ~~interest,~~capital ~~taxes,~~needs. ~~depreciation~~During ~~and~~the ~~amortization)~~first ~~covenant,~~six ~~effective September~~months ~~30,~~of ~~2005~~2006, ~~for~~we ~~the~~used ~~twelve~~$14.4 ~~months~~million in ~~ended~~financing ~~that~~activities ~~date~~as ~~and~~ we ~~were~~used inthe ~~compliance~~proceeds ~~with all~~from of the ~~loans’~~Clear ~~covenants~~Channel asTransaction ofto reduce ~~September~~our ~~30,~~outstanding ~~2005~~debt.

WeCash ~~will~~provided ~~not~~by operating activities of our discontinued operations during the first six months of 2007, ~~however~~including allocated interest expense, bewas $44,000 compared to cash used in the ~~compliance~~first ~~with~~six ~~our~~months ~~minimum~~of ~~EBITDA~~2006 ~~requirements~~of ~~under~~$917,000. ~~these~~This decrease in cash usage was primarily due to ~~financial~~reduced ~~covenants~~operating ~~beginning~~income ~~with~~from ~~the~~our ~~quarter~~discontinued ~~ended~~stations ~~December~~resulting ~~31,~~from ~~2005.~~the ~~Based~~sale onof ~~these~~station ~~covenant~~WTVK ~~issues~~in February 2007, which was profitable and ~~because~~generated ~~both~~operating cash flow, partially offset by a decrease in interest expense. Cash used in investing activities was $29,000 for the ~~revolver~~first ~~and~~six ~~second-lien~~months ~~term~~of ~~loan~~2007 ~~lenders~~and ~~have~~$67,000 for the first six months of 2006, both ~~right~~relating to ~~demand~~capital ~~immediate~~expenditures. ~~repayment~~Cash ofused in financing activities for our discontinued operations was $35,000 for the ~~loans~~first ifsix wemonths doof ~~not~~2007 ~~meet~~compared ~~these~~to ~~covenants,~~$1.3 ~~we have~~million ~~classified~~in the first ~~debt~~six ~~under~~months ~~both~~of ~~agreements~~2006 as– ~~current~~both ~~liabilities~~representing asthe payment of ~~September~~financing 30fees, which in ~~2005~~the first six months of 2006 included fees in connection with amending our credit facilities described below.

AsOn ~~noted~~March 29, 2006, we ~~have~~restructured ~~entered~~our ~~into~~revolving ancredit ~~agreement~~facility to(the ~~sell~~“Revolver”) and ~~KUWB,~~ our ~~Salt~~second-lien ~~Lake~~term ~~City~~loan ~~station,~~(the ~~to Clear Channel Communications for $18~~“SLTL”).5 ~~million.~~The Weamendment ~~will~~to ~~be discussing with~~ our ~~lenders~~Revolver ~~during~~eliminated ~~the~~all ~~coming~~financial ~~months~~covenants ~~amending~~effective ~~our~~December ~~credit~~31, ~~agreements~~2005, toreset ~~reflect~~the ~~this~~maximum ~~sale and resetting~~advances ~~financial~~under ~~covenants~~the ~~through~~Revolver to the ~~balance~~lesser of ~~the~~$60.0 ~~loan~~million ~~terms.~~or We50% ~~cannot~~of ~~assure~~the ~~you~~aggregate ~~that~~appraised weSTAC ~~will~~(“start-up bestations ~~successful~~with inaffiliation ~~completing~~agreements”) ~~the~~and ~~sale~~allowed ofus ~~KUWB,~~to orborrow ~~the sale of any of our other~~$10.0 ~~stations~~million onthat ~~acceptable~~same ~~terms~~date ~~or,~~to inreduce the ~~absence~~outstanding ofborrowings ~~any~~on ~~sales,~~our behigher ~~able~~interest torate SLTL ~~obtain~~ from ~~our lenders~~$20.0 ~~any~~million ~~waiver~~to or$10.0 ~~amendment~~million. onIn ~~terms favorable to us~~addition, orupon bethe successful incompletion ~~replacing~~of ~~our~~the ~~credit~~Clear ~~facilities,~~Channel ~~if necessary. We are a net borrower~~Transaction, ~~with~~the ~~cash~~amendment ~~operating~~extended ~~losses, capital expenditures and~~ the ~~occasional~~maturity ~~repurchases~~date offor ~~our~~the ~~common~~Revolver to ~~stock~~May ~~being~~2009, ~~financed through~~allowed ~~our~~up ~~revolving~~to ~~credit facility~~$20.0 Ifmillion wein ~~were~~stock inrepurchases ~~default~~and ~~under~~required ~~our~~us ~~credit~~to ~~facilities~~repay ~~and~~from ~~unable~~the toClear ~~secure~~Channel ~~alternative~~Transaction ~~funding~~the orfinal ~~replace~~$10.0 ormillion ~~renegotiate~~in ~~existing~~outstanding ~~facilities,~~balances asunder aour ~~net~~SLTL ~~borrower,~~and weterminate ~~would~~that ~~not~~agreement. beThe ~~able~~amendment to ~~fund~~our ~~existing~~SLTL ~~operations~~eliminated ~~unless~~financial covenants weeffective ~~sold~~December ~~assets~~31, ~~and~~ ~~such~~2005 ~~sales~~and ~~could~~reduced beour atprepayment ~~less than full price~~penalty.

11 On April 4, 2006, we completed the Clear Channel Transaction and repaid the remaining balances under the SLTL. The remaining $8.5 million of the $18.5 million KUWB sales proceeds were used to reduce our outstanding borrowings under our Revolver. On February 16, 2007, we completed the Sun Transaction and completely repaid the then outstanding borrowings and accrued interest under the Revolver of $37.2 million. On May 30, 2007, we voluntarily elected to permanently reduce our advance rate from 45% of appraised STAC value to 20% of appraised STAC value which resulted in a reduction in our maximum allowed borrowings from $39.9 million to approximately $17.7 million and also reduced our borrowing rates by 250 basis points. At June 30, 2007, our outstanding borrowings under the Revolver were $2.4 million and our available credit, net of a lender reserve for six-months of cash interest expense of approximately $120,000, was $15.3 million.

AsAlthough the completion of ~~September~~our 30sales of KUWB and WTVK eliminated our debt, ~~2005~~we continue to be a net borrower with a portion of our March 2007 cash dividend, ~~there~~our ~~was~~cash ~~approximately~~operating ~~$31~~losses, capital expenditures and current state taxes being funded by our Revolver.~~7 million~~ Furthermore, due to the buy-out of our former co-venture partner, we will incur increased cash losses relating to our Daily Buzz production costs over the coming months. When we complete the GoCom Transaction, we will likely reduce our outstanding ~~under~~borrowings by the net proceeds ~~revolving~~from ~~credit~~the ~~facility~~sale atand anour ~~average~~net ~~rate~~losses ofwill 8be reduced since WBUI continues to be unprofitable.6% However, ~~per~~even ~~annum~~after the completion of our GoCom Transaction, we will likely still not generate cash due to continued operating losses, capital expenditures and tax payments. Upon the completion of the GoCom Transaction, our maximum borrowings allowed under our revolver would be reduced from $2017.07 million to $16.9 million, still well in excess of our ~~outstanding~~foreseeable ~~under~~cash needs. Our amended Revolver contains a provision that upon the ~~second-lien~~occurrence of ~~term~~an ~~loan~~event ~~agreement~~or atcondition that has a ~~rate~~material ofadverse 10change on our business (a “MAC”), the lenders can refuse to make additional advances under the facility.9% Accordingly, if a MAC occurs in the future, we might not have access to funds under our Revolver which may be necessary for us to meet our obligations, including cash interest payable to the lenders, as they become due. ~~Approximately~~If we fail to meet such obligations as they ~~$19~~become due, the lenders could claim a default and accelerate all amounts due under the Revolver.~~3 million~~ ofAlthough ~~additional~~we ~~borrowings~~believe ~~were~~it ~~available~~unlikely that such a MAC might occur, if it did and if the lenders stopped funding us under the ~~revolving~~Revolver, ~~credit~~we also have the ability to sell select ~~facility~~stations, aseven if at less than full price. We would also explore the options of ~~September~~replacing the 30Revolver or raising additional equity. There is no guarantee that such other means of raising capital will be at terms acceptable to us, ~~2005~~and accordingly current stockholders could be adversely affected by such financings.

Our credit agreements allow us to repurchase up to an additional $15 million in our common stock in addition to the $5 million repurchased in 2004. The aforementioned November 7, 2005 amendment, however, limits our ability to repurchase shares until such time that we achieve certain dollar thresholds of station sales, including the pending sale of our Salt Lake City station. Further, the November 7, 2005 amendment requires us to pay down our senior credit facility with the proceeds of the Salt Lake City station sale and permanently reduce our maximum borrowings by that amount. 13

Our NovemberForward 8,Looking 2004 Board authorization to repurchase of up to $10 million in our common stock expires on December 31, 2005. To date, we have not repurchased any of our common stock under this latest authorization. Past stock repurchases have been funded by borrowings under our revolving credit facility. Future stock repurchases, if they occur, will be funded through either borrowings under our revolving credit facility or through station sales, or both. Statements

On ~~April~~This ~~14,~~Quarterly ~~2005,~~Report weon ~~concurrently~~Form 10-Q ~~acquired~~includes ~~and~~forward-looking ~~then~~statements. ~~sold~~We have based these forward-looking statements on our ~~interest~~current inexpectations ~~the~~and ~~Flint~~projections about ~~construction~~future ~~permit~~events. ~~and~~In ~~generated~~some acases, ~~net~~you ~~gain~~can onidentify ~~these~~forward-looking ~~transactions~~statements by terminology such as “may,” “will,” “could,” “expect,” “believe,” ‘should’, “hopeful” or “might” or the negative of ~~approximately~~such $1terms or other comparable terminology.~~2 million.~~ ~~The~~Forward-looking ~~net~~statements ~~cash~~involve known ~~generated~~and ~~from~~unknown ~~this~~risks, ~~sale~~uncertainties ~~was~~and ~~used~~other tofactors ~~pay~~that ~~down~~may cause our ~~outstanding~~and the ~~borrowings~~television ~~under~~broadcast ~~our~~industry’s ~~revolver~~actual results, levels of activity, performance, achievements and prospects to be materially different from those expressed or implied by such forward-looking statements. WeActual ~~expect~~results ~~that~~in ~~any~~the future ~~acquisitions~~could (differ materially and adversely ~~related~~from ~~capital~~those described in the forward-looking statements as a result of various ~~expenditures~~important factors, including (but not limited to) an inability of ~~television~~The ~~stations~~CW Network or MyNetworkTV to attract and grow viewership, the impact of changes in national and regional economies, including ~~that~~advertising demand, pricing fluctuations in local and national advertising, volatility in programming costs, the failure to complete the sale of our Decatur ~~Lexington~~station ~~construction~~to ~~permit~~GoCom Media of Illinois, LLC, and the other risk factors set forth in ~~would~~the beCompany’s ~~financed~~2006 ~~through~~Form ~~borrowings~~10-K/A orfiled ~~possibly~~with ~~through~~the ~~additional~~Securities ~~equity~~and ~~financings~~Exchange Commission on April 10, 2007.

We undertake no duty to publicly update or revise any forward-looking statements, whether as aresult of new information, future events or otherwise, after the date of this Quarterly Report onForm 10-Q. In light of these risks, uncertainties and assumptions, the forward-looking events discussedin this Quarterly Report on Form 10-Q might not occur.

Critical Accounting Policies and Estimates

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to broadcast rights, bad debts, intangible assets, income taxes, and contingencies and litigation. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Our critical accounting policies are fully disclosed in our ~~annual~~2006 ~~report~~Annual Report on Form 10-K/A filed with the SEC on ~~March~~April 1610, ~~2005~~2007. There have been no material changes to these policies during the quarter ended ~~September~~June 30, ~~2005~~2007.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The Company’s revolving credit ~~facilities~~facility ~~have~~has a variable interest ~~rates~~rate. Accordingly, the Company’s interest expense could be materially affected by future fluctuations in the applicable interest rates. At ~~September~~June 30, ~~2005~~2007, the Company had ~~outstanding~~aggregate ~~borrowings~~outstanding borrowings of $512.74 million under its ~~credit~~Revolver ~~facilities~~ at an effective annual borrowing rate of 9of 8.511%. Based on the outstanding borrowings at ~~September~~June 30, ~~2005~~2007, a 1% increase in our effective borrowing rate would increase our annual interest expense by approximately $~~517~~24,000.

Item 4. Controls and Procedures

Disclosure controls and procedures are designed to ensure that information required to be disclosed in our periodic reports filed or submitted under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the required time periods. As of ~~September~~ June 30, ~~2005~~2007, the end of the period covered by this report, the Company carried out an an evaluation under the supervision and with the participation of our Chief Executive ~~Officer~~ Officer and Chief Financial Officer of the effectiveness of our disclosure controls and procedures. Based on our aforementioned evaluation, our Chief Executive Officer and Chief ~~Financial~~ Financial Officer have concluded that such controls and procedures were effective.

There were no changes in the Company’s internal controls over financial reporting during the quarter ended ~~September~~June 30, ~~2005~~2007 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

1214

PART II — OTHER INFORMATION

Item 21. ChangesLegal in Securities, Use of Proceeds and Issuer Purchases of Equity Securities Proceedings

On ~~November~~ The Company 8,is ~~2004,~~from ~~the~~time ~~Board~~to oftime ~~Directors~~involved ~~authorized~~in ~~the~~litigation ~~Company~~incidental to ~~repurchase~~the upconduct toof ~~$10.0~~its ~~million~~business. ofThe ~~our~~Company ~~common~~maintains ~~stock~~comprehensive ingeneral ~~open~~liability ~~market~~ and ~~private~~other ~~transactions~~insurance, ~~through~~which it ~~December~~believes ~~31, 2005~~to be adequate for the purpose. WeThe ~~have~~Company is not ~~acquired~~currently ~~any~~a ~~shares~~party to ~~date~~any lawsuit ~~under~~or ~~this~~proceeding ~~program~~that management believes would have a material adverse affect on its financial condition or results of operations.

Item 61A. ExhibitsRisk and Reports on Form 8-K.Factors

~~(a)~~ There have ~~Exhibits~~been no material changes in the risk factors disclosed in Item 1A of Part I in our Annual Report on Form 10-K/A for the year ended December 31, 2006.

10Item 2.1 ~~Asset~~Changes ~~Purchase~~in ~~Agreement Dated August 8~~Securities, Use ~~2005 between ACME Television~~ of ~~Utah,~~Proceeds ~~LLC,~~and ~~ACME~~Issuer ~~Television~~Purchases ~~Licenses~~ of ~~Utah,~~Equity ~~LLC,~~Securities ~~Clear Channel Broadcasting, Inc. and Clear Channel Broadcasting Licenses, Inc.~~

10 None.2 Second Amendment to the Second Amended and Restated Loan and Security Agreement by and among ACME Television, LLC, the Lenders that are signatories thereto and Wells Fargo Foothill, Inc., as Arranger and Administrative Agent, dated November 7, 2005.

10Item 4.3 SecondSubmission Amendmentof Matters to thea LoanVote andof Security Agreement by and among ACME Television, LLC, the Lenders that are signatories thereto and Fortress Credit Corp., as Arranger and Administrative Agent, dated November 7, 2005.Holders

~~31.1~~ Our ~~Certification~~Annual Meeting of ~~Chief~~Stockholders ~~Executive~~was ~~Officer~~held ~~pursuant~~June 1, 2007 to elect ~~Rules~~our ~~13a-14~~eight directors (aconstituting the entire Board of Directors) ~~under~~for the ~~Securities~~term of one year and ~~Exchange~~to ~~Act~~ratify the appointment of ~~1934,~~Mayer Hoffman McCann P.C. as ~~amended~~our independent accountants.

~~31.2~~ The ~~Certification~~following table lists the number of ~~Chief~~votes ~~Financial~~cast ~~Officer~~for, against ~~pursuant~~or towithheld, ~~Rules~~abstentions ~~13a~~and broker non-~~14(a)~~votes ~~under~~for each of the ~~Securities~~individuals ~~and~~elected to ~~Exchange~~the ~~Act~~Board of ~~1934,~~Directors. ~~as amended~~

32 Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Nominee	For	Withheld/ Against	Abstentions	Broker Non-Votes
Jamie Kellner	12,022,452	3,152,402	--	--
Douglas Gealy	12,023,052	3,151,802	--	--
Thomas Allen	11,984,750	3,190,104	--	--
John Conlin	15,123,933	50,921	--	--
Michael Corrigan	12,231,376	2,943,478	--	--
Thomas Embrescia	14,687,838	487,016	--	--
Brian McNeill	14,687,838	3,141,802	--	--
Frederick Wasserman	15,123,933	50,921	--	--

13 The appointment of Mayer Hoffman McCann P.C. as independent accountants was ratified with 15,174,854 votes for ratification, 30,218 votes against ratification and 5,169 votes abstaining. There were no votes withheld and no broker non-votes.

Item 5. Other Information

None.

Item 6. Exhibits

3.1

Certificate of Incorporation of ACME Communications, Inc. (1)

3.2

Form of Restated Bylaws of ACME Communications, Inc. (1)

10.1

Asset Purchase Agreement dated June 14, 2007 by and among GoCom Media of Illinois, LLC, ACME Television of Illinois, LLC and ACME Television Licenses of Illinois, LLC. (2)

31.1

Certification of Chief Executive Officer pursuant to Rules 13a-14(a) under the Securities and Exchange Act of 1934, as amended

31.2

Certification of Chief Financial Officer pursuant to Rules 13a-14(a) under the Securities and Exchange Act of 1934, as amended

Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

(1)

Incorporated by reference to the Registration Statement for ACME Communications, Inc. on Form S-1/A, File No. 333-84191, filed on September 29, 1999.

(2)

Incorporated by reference to the report on Form 8-K filed by ACME Communications, Inc. on June 20, 2007.

SIGNATURE

Pursuant to the requirements 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.

Date: ~~November~~August 914, ~~2005~~2007 ACME Communications, Inc. By: /s/ Thomas D. Allen Thomas D. Allen Executive ~~Vice~~VP ~~President, CFO~~ & ~~Principal~~Chief ~~Accounting~~Financial Officer

1416

EXHIBIT INDEX

Exhibit Number	Description
10.1	Asset Purchase Agreement Dated August 8, 2005 between ACME Television of Utah, LLC, ACME Television Licenses of Utah, LLC, Clear Channel Broadcasting, Inc. and Clear Channel Broadcasting Licenses, Inc.
3.1	Certificate of Incorporation of ACME Communications, Inc. (1)
10.2	Second Amendment to the Second Amended and Restated Loan and Security Agreement by and among ACME Television, LLC, the Lenders that are signatories thereto and Wells Fargo Foothill, Inc., as Arranger and Administrative Agent, dated November 7, 2005.
3.2	Form of Restated Bylaws of ACME Communications, Inc.(1)
10.3	Second Amendment to the Loan and Security Agreement by and among ACME Television, LLC, the Lenders that are signatories thereto and Fortress Credit Corp., as Arranger and Administrative Agent, dated November 7, 2005.
10.1	Asset Purchase Agreement dated June 14, 2007 by and among GoCom Media of Illinois, LLC, ACME Television of Illinois, LLC and ACME Television Licenses of Illinois, LLC. (2)
31.1	Certification of Chief Executive Officer pursuant to Rules 13a-14(a) under the Securities and Exchange Act of 1934, as amended
31.2	Certification of Chief Financial Officer pursuant to Rules 13a-14(a) under the Securities and Exchange Act of 1934, as amended
32	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

15(1) Incorporated by reference to the Registration Statement for ACME Communications, Inc. on Form S-1/A, File No. 333-84191, filed on September 29, 1999.

(2)

Incorporated by reference to the report on Form 8-K filed by ACME Communications, Inc. on June 20, 2007.

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

For the Quarterly Period Ended SeptemberJune 30, 20052007

ACME Communications, Inc. and Subsidiaries Notes to Consolidated Financial Statements (Unaudited)

ACME Communications, Inc. and SubsidiariesNotes to Consolidated Financial Statements(Unaudited)

(1) Formation and Description of the Business

Formation &and Presentation

Description of the Business

(2)Recent PresentationAccounting of Interim Consolidated Financial StatementsPronouncements

7(6) Stock-Based Compensation

(9) Barter and Trade Transactions

(10) Income (Loss) Per Common Share

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

Results of Operations

The Three Months Ended SeptemberJune 30, 20052007 vs.Compared Septemberto June 30, 20042006

Our netThe lossSix forMonths theEnded thirdJune quarter30, of2007 2005Compared was $3.9 million compared to aJune net30, loss of $4.6 million for the third quarter of 2004. 2006

Liquidity and Capital Resources

Critical Accounting Policies and Estimates

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Item 4. Controls and Procedures

PART II — OTHER INFORMATION

Item 21. ChangesLegal in Securities, Use of Proceeds and Issuer Purchases of Equity Securities Proceedings

Item 61A. ExhibitsRisk and Reports on Form 8-K.Factors

10Item 4.3 SecondSubmission Amendmentof Matters to thea LoanVote andof Security Agreement by and among ACME Television, LLC, the Lenders that are signatories thereto and Fortress Credit Corp., as Arranger and Administrative Agent, dated November 7, 2005.Holders

Item 5. Other Information

Item 6. Exhibits

SIGNATURE

EXHIBIT INDEX

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

ACME Communications, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)

Filing Compare · ACME COMMUNICATIONS INC