3 .	Long-term Debt

As of

September 30, 2017

and

December 31, 2016,

long-term debt primarily consisted of obligations under our

2017

Senior Credit Facility (as defined below), our

2014

Senior Credit Facility (as defined below), our

5.125%

Senior Notes due

2024

(the

“2024

Notes”) and our

5.875%

Senior Notes due

2026

(the

“2026

Notes”), as follows (in thousands):

	September 30,			December 31,
	2017			2016
Long-term debt including current portion:
2014 Senior Credit Facility	$	-		$	556,438
2017 Senior Credit Facility		636,838			-
2024 Notes		525,000			525,000
2026 Notes		700,000			700,000
Total outstanding principal		1,861,838			1,781,438
Unamortized deferred loan costs - 2014 Senior Credit Facility		-			(12,158	)
Unamortized deferred loan costs - 2017 Senior Credit Facility		(12,406	)		-
Unamortized deferred loan costs - 2024 Notes		(6,993	)		(7,742	)
Unamortized deferred loan costs - 2026 Notes		(9,751	)		(10,588	)
Unamortized premium - 2026 Notes		5,339			5,797
Less current portion		(6,417	)		-
Net carrying value	$	1,831,610		$	1,756,747

Borrowing availability under the Revolving Credit Facility	$	100,000		$	60,000

February 7, 2017,

we entered into a Third Amended and Restated Credit Agreement (the

“2017

Senior Credit Facility”)

, consisting of a

$556.4

million term loan facility (the

“2017

Initial Term Loan”) and a

$100.0

million revolving credit facility (the

“2017

Revolving Credit Facility”). Amounts outstanding under the

2017

Initial Term Loan were used to repay amounts outstanding under our prior credit agreement (the

“2014

Senior Credit Facility”).

April 3, 2017,

we borrowed

$85.0

million under an incremental term loan (the

“2017

Incremental Term Loan” and, together with the

2017

Initial Term Loan, the

“2017

Term Loan”) under the

2017

Senior Credit Facility to fund the Diversified Acquisition. As of

September 30, 2017,

the

2017

Senior Credit Facility provided total

commitments of

$736.8

million, consisting of the

$636.8

million

2017

Term Loan and the

$100.0

million

2017

Revolving Credit Facility.

Our quarterly principal payments under the

2017

Term Loan are

$1.6

million.

Prior to the entry into the

2017

Senior Credit Facility, the

2014

Senior Credit Facility consisted of a revolving loan and a term loan.

Excluding accrued interest, the amount outstanding under our

2014

Senior Credit Facility as of

December 31, 2016

consisted solely of a term loan balance of

$556.4

million. As of

December 31, 2016,

the interest rate on the balance outstanding under the

2014

Senior Credit Facility was

3.9%.

Borrowings under the

2017

Term Loan

currently bear interest, at our option, at either the London Interbank Offered Rate (“LIBOR”) or the Base Rate (as defined below), in each case, plus an applicable margin. Currently, the applicable margin

2.25%

for LIBOR borrowings and

1.25%

for Base Rate borrowings. The applicable margin is determined quarterly based on our leverage ratio as set forth in the

2017

Senior Credit Facility (the “Leverage Ratio”). If our Leverage Ratio is less than or equal to

5.25

1.00,

the applicable margin will be

2.25%

for all LIBOR borrowings and

1.25%

for all Base Rate borrowings and if the Leverage Ratio is greater than

5.25

1.00,

the applicable margin will be

2.5%

for all LIBOR borrowings. As of

September 30, 2017,

the interest rate on the balance outstanding under the

2017

Term Loan

was

3.7%.

Borrowings under the

2017

Revolving Credit Facility

currently bear interest, at our option, at either LIBOR plus

1.50%

or Base Rate plus

0.50%,

in each case based on a

first

lien leverage ratio test as set forth in the

2017

Senior Credit Facility (the “First Lien Leverage Ratio”). Base Rate is defined as the greatest of (i) the administrative agent’s prime rate, (ii) the overnight federal funds rate plus

0.50%

and (iii) LIBOR plus

1.00%.

We are required to pay a commitment fee on the average daily unused portion of the

2017

Revolving Credit Facility, which rate

may

range from

0.375%

0.50%

on an annual basis, based on the First Lien Leverage Ratio. The

2017

Revolving Credit Facility matures on

February 7, 2022,

and the

2017

Term Loan matures on

February 7, 2024.

As a result of entering into the

2017

Senior Credit Facility, we recorded a loss on extinguishment of debt of

approximately

$2.9

million in the

nine

-months ended

September 30, 2017,

and we incurred approximately

$5.0

million in deferred financing costs that will be amortized over the life of the

2017

Senior Credit Facility.

As of

September 30, 2017

and

December 31, 2016,

we had

$525.0

million of

2024

Notes outstanding.

The interest rate and yield on the

2024

Notes were

5.125%

The

2024

Notes mature on

October 15, 2024.

Interest is payable semiannually, on

April

and

October

of each year.

June 14, 2016,

we completed the private placement of

$500.0

million of our

2026

tes (the “Original

2026

Notes”) at par. On

September 14, 2016,

we completed the private placement of an additional

$200.0

million of our

2026

Notes (the “Additional

2026

Notes”). The Additional

2026

Notes were issued at a price of

103.0%,

resulting in aggregate gross proceeds of approximately

$206.0

million, plus accrued and unpaid interest from and including

June 14, 2016.

As of

September 30, 2017

and

December 31, 2016,

we had

$700.0

million of

2026

Notes outstanding. The interest rate and yield on the Original

2026

Notes were

5.875%.

The interest rate and yield on the Additional

2026

Notes were

5.875%

and

5.398%

respectively. The Additional

2026

Notes are an additional issuance of, rank equally with and form a single series with the Original

2026

Notes. The

2026

Notes mature on

July 15, 2026.

Interest is payable semiannually, on

January

and

July

of each year.

Collateral, Covenants and Restrictions

Our obligations under the

2017

Senior Credit Facility are secured by substantially all of

our consolidated assets, excluding real estate. In addition, substantially all of our subsidiaries are joint and several guarantors of, and our ownership interests in those subsidiaries are pledged to collateralize, our obligations under the

2017

Senior Credit Facility. Gray Television, Inc. is a holding company with

material independent assets or operations. For all applicable periods, the

2024

Notes and

2026

Notes have been fully and unconditionally guaranteed, on a joint and several, senior unsecured basis, by substantially all of Gray Television, Inc.'s subsidiaries. Any subsidiaries of Gray Television, Inc. that do

not

gurantee the

2024

Notes and

2026

Notes are minor. As of

September 30, 2017,

there were

significant restrictions on the ability of Gray Television, Inc.'s subsidiaries to distribute cash to Gray or to the guarantor subsidaries.

The

2017

Senior Credit Facility contains affirmative and restrictive covenants with which we must comply, including: (a) limitat

ions on additional indebtedness, (b) limitations on liens, (c) limitations on the sale of assets, (d) limitations on guarantees, (e) limitations on investments and acquisitions, (f) limitations on the payment of dividends and share repurchases, (g) limitations on mergers and (h) maintenance of the First Lien Leverage Ratio while any amount is outstanding under the revolving credit facility, as well as other customary covenants for credit facilities of this type. The

2026

Notes and

2024

Notes include covenants with which we must comply which are typical for borrowing transactions of their nature. As of

September 30, 2017

and

December 31, 2016,

we were in compliance with all required covenants under all our debt obligations.

Maturities

Aggregate minimum principal maturities on long-term debt as of

September 30, 2017

were as follows (in thousands):

	Minimum Principal Maturities
Year	2017 Senior Credit Facility		2024 Notes		2026 Notes		Total
2017	$	1,604	$	-	$	-	$	1,604
2018		6,417		-		-		6,417
2019		6,417		-		-		6,417
2020		6,417		-		-		6,417
2021		6,417		-		-		6,417
Thereafter		609,566		525,000		700,000		1,834,566
Total	$	636,838	$	525,000	$	700,000	$	1,861,838