Note 4 - Long-term Debt

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Debt Disclosure [Text Block]

4. Long-term Debt

As of December 31, 2021, long-term debt consisted of obligations under our 2019 Senior Credit Facility (as defined below), our 5.875% senior notes due 2026 (the “2026 Notes”), our 7.0% senior notes due 2027 (the “2027 Notes”) our 4.75% senior notes due 2030 (the “2030 Notes”) and our 5.375% senior notes due 2031 (the “2031 Notes”). As of December 31, 2020, long-term debt primarily consisted of obligations under our 2019 Senior Credit Facility, our 2026 Notes, our 2027 Notes and our 2030 Notes as follows (in millions):

	December 31,
	2021			2020
Long-term debt:
2019 Senior Credit Facility:
2017 Term Loan	$	595		$	595
2019 Term Loan		1,190			1,190
2021 Term Loan		1,500			-
2026 Notes		700			700
2027 Notes		750			750
2030 Notes		800			800
2031 Notes		1,300			-
Total outstanding principal		6,835			4,035
Unamortized deferred loan costs - 2017 Term Loan		(7	)		(4	)
Unamortized deferred loan costs - 2019 Term Loan		(27	)		(30	)
Unamortized deferred loan costs - 2021 Term Loan		(5	)		-
Unamortized deferred loan costs - 2026 Notes		(5	)		(6	)
Unamortized deferred loan costs - 2027 Notes		(8	)		(10	)
Unamortized deferred loan costs - 2030 Notes		(13	)		(14	)
Unamortized deferred loan costs - 2031 Notes		(18	)		-
Unamortized premium - 2026 Notes		3			3
Less current portion		(15	)		-
Long-term debt, less deferred financing costs	$	6,740		$	3,974
Borrowing availability under Revolving Credit Facility	$	497		$	200

2021 Term Loan. To complete the Meredith Transaction, on December 1, 2021, we incurred a $1.5 billion incremental term loan under our Senior Credit Facility. The 2021 Term Loan requires us to make quarterly principal payments of $3.75 million beginning March 31, 2022. The 2021 Term Loan matures on December 1, 2028.

Borrowings under the 2021 Term Loan, 2019 Term Loan and the 2017 Term Loan bear interest, at our option, at either the London Interbank Offered Rate (“LIBOR”) or the Base Rate, in each case, plus an applicable margin. As of December 31, 2021, the interest rate on the balance outstanding under the 2021 Term Loan, 2019 Term Loan and the 2017 Term Loan were 3.1%, 2.6% and 2.6%, respectively. The 2019 Term Loan and the 2017 Term Loan mature on January 2, 2026 and February 7, 2024, respectively.

On November 9, 2021, we issued $1.3 billion of our 2031 Notes and used the net proceeds therefrom, after deducting transaction fees and estimated expenses, to pay a portion of the consideration for the Meredith Transaction. The interest rate and yield on the 2031 Notes is 5.375%. The 2031 Notes rank equally with the 2030 Notes, 2027 Notes and the 2026 Notes and the 2031 Notes mature on November 15, 2031. Interest is payable semiannually, on May 15 and November 15 of each year.

As of December 31, 2021, the aggregate minimum principal maturities of our long-term debt were as follows (in millions):

	Minimum Principal Maturities
	2019 Senior		2026		2027		2030		2031
Year	Credit Facility		Notes		Notes		Notes		Notes		Total
2022	$	15	$	-	$	-	$	-	$	-	$	15
2023		15		-		-		-		-		15
2024		610		-		-		-		-		610
2025		15		-		-		-		-		15
2026		1,205		700		-		-		-		1,905
Thereafter		1,425		-		750		800		1,300		4,275
Total	$	3,285	$	700	$	750	$	800	$	1,300	$	6,835

Collateral, Covenants and Restrictions. Our obligations under the 2019 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 2019 Senior Credit Facility. Gray Television, Inc. is a holding company, and has no material independent assets or operations. For all applicable periods, the 2026 Notes, 2027 Notes, 2030 Notes and 2031 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 guarantee the 2026 Notes, 2027 Notes, 2030 Notes and 2031 Notes are not material. As of December 31, 2021, there were no significant restrictions on the ability of Gray Television, Inc.'s subsidiaries to distribute cash to Gray or to the guarantor subsidiaries.

The 2019 Senior Credit Facility contains affirmative and restrictive covenants with which we must comply, including: (a) limitations 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, 2027 Notes, 2030 Notes and 2031 Notes include covenants with which we must comply which are typical for borrowing transactions of their nature. As of December 31, 2021 and 2020, we were in compliance with all required covenants under all our debt obligations.

Interest Payments. For all of our interest-bearing obligations, we made interest payments of approximately $178 million, $179 million and $212 million during 2021, 2020 and 2019, respectively. We did not capitalize any interest payments during those years.

Amendments. On February 19, 2021, we entered into an amendment to the 2019 Senior Credit Facility, which, among other things, increases availability under the revolving credit facility (the "Revolving Credit Facility") under the 2019 Senior Credit Facility from an aggregate principal amount of $200 million to an aggregate principal amount of $300 million. On December 1, 2021, we entered into a further amendment to the 2019 Senior Credit Facility, which, among other things, increases availability under the Revolving Credit Facility under the 2019 Senior Credit Facility from an aggregate principal amount of $300 million to an aggregate principal amount of $500 million. In addition, certain terms related to our 2017 Term Loan and 2019 Term Loan were modified. In connection with these amendments, we incurred $5 million of lender fees that were capitalized as additional deferred loan costs, and $31 million of other third-party fees for legal, consulting, brokerage, insurance and other related costs, of which $6 million were capitalized as additional deferred loan costs and $25 million were charged to expense as additional corporate expenses in our consolidated statement of operations for the year ended December 31, 2021. The deferred loan costs will be amortized over the life of the respective debt obligations.